The U.S. Supreme Court decided on June 25, 2015, that the federal Fair Housing Act (“FHA,” 42 U.S.C. § 3601 et seq.,) prohibits housing practices that have a disproportionately adverse effect on members of minority groups—if those practices do not have a justifiable purpose and properly limited scope. Texas Dept. of Housing and Community Affairs v. Inclusive Communities Project (ICP), No. 13–1371 (June 25, 2015).

In a 5-4 decision, the Court held that discriminatory intent is irrelevant to whether such a “disparate impact” violation exists. The Court also explained what a litigant must show in order to prove, or defend against, an alleged violation. The Court’s decision applies both to government officials and private persons.

The FHA’s prohibition on practices that have such a “disparate impact” is an important basis for challenging exclusionary housing policies, because those policies often have much greater adverse impacts on minority group members than on the overall population. As the Court stated:

These unlawful practices include zoning laws and other housing restrictions that function unfairly to exclude minorities from certain neighborhoods without any sufficient justification. Suits targeting such practices reside at the heartland of disparate-impact liability.

(Slip op. at 17) The Court’s opinion, authored by Justice Kennedy, clarified the elements of a disparate impact housing violation, which had been stated somewhat differently by certain lower courts. The Supreme Court essentially adopted the statement of those elements in the recent rule issued by the U. S. Department of Housing and Urban Development (HUD), regarding such cases. Implementation of the Fair Housing Act’s Discriminatory Effects Standard: Final Rule, 78 Fed. Reg. 11460 (2013) (codified at 24 CFR §100.500).

HUD’s formulation involves the same kind of burden-shifting approach the Court has formulated for other anti-discrimination laws, such as Title VII of the Civil Rights Act of 1964 (equal employment opportunity). Thus, a person complaining of alleged housing discrimination (“plaintiff”) has the initial burden of proving “that a challenged practice caused or predictably will cause a discriminatory effect.” 24 CFR §100.500(c)(1) (2014).

If a plaintiff makes that showing, the burden shifts to the defendant to prove “that the challenged practice is necessary to achieve one or more substantial, legitimate, nondiscriminatory interests.” Id., §100.500(c)(2). If the defendant makes its showing, the plaintiff still can “prevail upon proving that the substantial, legitimate, nondiscriminatory interests supporting the challenged practice could be served by another practice that has a less discriminatory effect.” Id., §100.500(c)(3).

To see the Supreme Court decision and/or HUD rule in their entirety, click on the hyperlinks above. For further information, please contact EHI.