Is Disparate Impact Having Any Impact? An Appellate Analysis of Forty Years of Disparate Impact Claims Under the Fair Housing Act
109 Pages Posted: 6 Oct 2013
Date Written: October 4, 2013
This article addresses an issue to be decided by the Supreme Court this term, with the Court recently granting certiorari in the case of Mount Holly Gardens Citizens in Action, Inc. v. Township of Mt. Holly, 658 F.3d 375 (3rd Cir. 2011). The sole issue to be decided in the case is whether the disparate impact theory is cognizable under the Fair Housing Act (FHA).
After forty years of FHA disparate impact jurisprudence, in which every circuit court to consider the question has decided that liability can be imposed under the FHA on a showing of discriminatory effects, the Supreme Court has decided to review the theory in the exceedingly rare context (under the FHA) of two summary judgment reversals reinstating plaintiffs’ claims.
My review of the appellate case law over four decades reveals that plaintiffs have struggled to obtain and preserve positive outcomes using the FHA disparate impact theory. Plaintiffs have received positive decisions in only 20 percent, or 18 of the 92 FHA disparate impact claims considered on appeal. Although defendants were able to have 83.8% of their positive FHA disparate impact outcomes affirmed on appeal, plaintiffs were able to hold onto only 33.3% of their positive outcomes. Plaintiffs were able to reverse summary judgment in only two cases prior to the Court’s granting certiorari in the recent decisions of Magner (settling prior to argument) and Mount Holly. My review reveals only one other positive appellate outcome for plaintiffs in forty years on facts similar to Magner and Mount Holly, and even then the court did not grant the requested relief. It is unclear why the Court has granted cert. to review FHA disparate impact theory, but an analysis of forty years of appellate case law demonstrates that the courts have applied a narrowly circumscribed version of the theory.
I have labeled Magner and Mount Holly “housing improvement” cases because they involve disparate impact challenges to plans or regulations that purportedly improve housing while displacing persons of color at disproportionate rates. These cases may be contrasted with what I describe in this article as “housing barrier” cases, which challenge regulations that perpetuate segregation by preventing housing opportunities for minority groups outside neighborhoods where they already live. Housing barrier cases promote the highest ideals of the FHA, while housing improvement cases meet protected class members where they are — in segregated, substandard housing. Housing barrier cases help protected class members climb the housing ladder to greater opportunity; housing improvement cases help prevent protected class members from being pushed down the ladder or knocked off altogether in the name of improvement. I discuss in the article the fact that both types of cases can further the purposes of the FHA, but housing improvement challenges must be reviewed with particular care to ensure that they do not perpetuate segregated, substandard housing.
As the quantitative and qualitative analysis of this article demonstrates, the circuit courts first allowing discriminatory effects to be used as a method of proof in FHA cases considered the theory in the context of housing barrier cases. The courts recognized the broad purpose of the FHA to “replace the ghettos ‘by truly integrated and balanced living patterns’” and saw FHA disparate impact challenges to housing barriers as essential to achieving this purpose. Housing barrier cases remain relevant today. A 21st century local government bureaucrat or elected official may not have created racial segregation in housing, but can virtually guarantee its perpetuation, with or without discriminatory purpose, by simply engaging in practices that help maintain the residential status quo. Not surprisingly, the predominant type of case addressing the FHA disparate impact theory at the appellate level remains the housing barrier challenge. Further, the housing barrier challenge is the predominant type of case among those positive outcomes achieved by plaintiffs at the appellate level. If disparate impact theory is eliminated as a method of proof in FHA cases, perhaps because of the Court’s distaste for housing improvement cases, then housing barrier challenges will be severely curtailed. The disparate treatment method of proof will capture only a fraction of housing barriers enacted or enforced in a way that perpetuates segregation. Given the persistence of residential racial segregation and Congress’s purpose in enacting the FHA to eliminate such segregation, the disparate impact theory remains a relevant, if misunderstood, tool for accomplishing Congress’s purpose, and should be upheld.
In 2013, we have fallen short of achieving Congress’s integration purpose in enacting the FHA, even with the disparate impact theory. It is difficult to imagine how we would fare without it.
Keywords: discrimination, civil rights, housing, segregation
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