Supreme Court Threatens Dubious Housing Bias Theory

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Investors Business Daily:

In what could neutralize a key Obama administration weapon to sue home lenders for discrimination, the Supreme Court agreed Monday to hear a case challenging the use of a questionable civil-rights theory.

The bench's conservative majority has been spoiling to strike down so-called disparate impact liability claims in housing and lending bias cases, legal experts say. It was poised to do so last year, but administration officials pressured a petitioner into dropping the case just weeks before the court was scheduled to hear oral arguments.

In the case now before the court — Mt. Holly v. Mt. Holly Gardens Citizens in Action — a New Jersey town argues it was unfairly sued for discrimination under a disparate impact claim, which carries a low standard of proof. Activists representing blacks and Latinos claim a town plan to redevelop a high-crime neighborhood is racist simply because it impacts more minorities than whites, regardless of any intent to discriminate. They say it's a violation of the Fair Housing Act.