The United States Supreme Court has agreed to hear argument in the case of Mt. Holly vs. Mt. Holly Garden Citizens in Action, a case that squarely presents the question whether a violation of the Fair Housing Act can be premised upon nothing more than a "disparate impact" analysis. If the Supreme Court holds that a violation of the act must be premised upon actual discriminatory intent, rather than merely upon disparate outcomes of non-discriminatory policies, lenders may see relief from lawsuits alleging discrimination in lending.
For years, class-action plaintiffs have pursued claims under the federal Equal Credit Opportunity Act ("ECOA"), asserting that race-neutral credit decisions were nevertheless discriminatory because statistical analysis demonstrated that minority borrowers paid more for consumer credit than did non-minority borrowers. A favorable decision from the Supreme Court in the Fair Housing context, could provide an additional legal basis for defending against "disparate impact" ECOA lawsuits. Such a ruling by the high court would confirm what lenders have known all along: equality of opportunity is not the same as equality of outcome.
For further information visit Waller's Banking Law Blog
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
