January 6, 2012

Disparate impact before the Supreme Court again

By Joshua P. Thompson Senior Attorney

My colleague Ralph Kasarda recently authored an amicus brief in the Supreme Court in Magner v. Gallagher, a case challenging whether the disparate impact theory is cognizable under the Fair Housing Act.  PLF was joined by the Cato Institute, the Competitive Enterprise Institute, and the Center for Equal Opportunity on its amicus brief.

The brief begins by arguing that Congress intended to preclude disparate impact claims under the Fair Housing Act.  The statutory argument in the brief is top-notch,  but I found the historical research that went into the brief more interesting. The brief includes a number of statements from former congressmen that clarify the intended scope of the Act.  For example, Senator Walter Mondale, a leading sponsor of the Act, stated:

“The bill permits an owner to do everything that he could do anyhow with his property—insist upon the highest price, give it to his brother or wife, sell it to his best friend, do everything he could ever do with property, except refuse to sell it to a person solely on the basis of his color or his religion.”

This is important because if Congress intended to permit disparate impact claims under the Act, an owner could not do anything with respect to his rental property that would cause a disparate impact.  The brief includes many more similar statements; if the Court finds disparate impact cognizable, it will be hard pressed to do so based on congressional intent.

But what I find most interesting about the brief is the second argument which explains the conflict between disparate impact theory and the Equal Protection Clause.   This is a topic I have written about many times before.  The brief explains that allowing a disparate impact theory to go forward would produce perverse results:

“It would be astonishing to interpret a national civil-rights statute in a way that makes identical conduct in one city illegal while allowing exactly the same conduct in another city, just because of the different racial makeup of the two cities. And it would be offensive to interpret the same statute to mean that whether a city can enforce an ordinance in a particular way hinges on an individual victim’s skin color and the skin color of his neighbors.”

But such a result is required if the Court allows a disparate impact claim to go forward here.  The City of St. Paul enforced race-neutral housing standards.  The City was concerned with slumlords, dilapidated housing, and substandard living conditions.  In response, the landlords sued, arguing that enforcing race-neutral housing criteria had a disparate impact on minorities.  If such a claim is cognizable, then every housing decision a city makes must be made with an eye towards the racial impact.  So, instead of progressing to a society where race is irrelevant in governmental decision making, race becomes the dominant consideration.  Fortunately, the Equal Protection Clause prohibits such a perverse result.

For more information on PLF’s brief, visit the blog of our co-amici:  the Cato Institute has a nice write up on the case, as does the Competitive Enterprise Institute.

What to read next