The department claims the proposed revisions are necessary to “align with the decision of the Supreme Court” in a 2015 case called Texas Department of Housing and Community Affairs v. Inclusive Communities Project. This was a fascinating case. It marked the last of three efforts by conservative forces (the state of Texas, in this instance) to propel a disparate-impact case to a Supreme Court that was viewed as increasingly open to the argument that not only did the Fair Housing Act not encompass such a claim, but that the Constitution might even prohibit it. The civil rights community was so alarmed when the court agreed to hear the earlier two cases, in 2011 and 2013, that it arranged to have the cases settled before the justices could decide them. Despite the fact there was still no disagreement among the federal appeals courts that disparate-impact discrimination was covered by the housing act, the conservative justices persisted, and agreed to hear the appeal by Texas in Inclusive Communities.
The court was almost universally expected to dispense with disparate-impact liability. That it didn’t happen left the civil rights community astonished and the conservative justices fuming; Justice Samuel Alito’s dissenting opinion was half again as long as Justice Anthony Kennedy’s opinion for the 5-to-4 majority. In his opinion, Justice Kennedy offered a sympathetic account of the role of disparate impact liability, which he said “permits plaintiffs to counteract unconscious prejudices and disguised animus that escape easy classification as disparate treatment.”
But he also warned about “the serious constitutional questions that might arise” if liability under the Fair Housing Act was imposed “based solely on a showing of a statistical disparity.” He said that “a disparate-impact claim that relies on a statistical disparity must fail if the plaintiff cannot point to a defendant’s policy or policies causing that disparity.” Disparate impact should be understood to include “a robust causality requirement,” Justice Kennedy said.
So while it was hardly the victory that conservatives had hoped for, the Kennedy opinion on close reading did cast a shadow over disparate impact. (Roger Clegg, a longtime warrior for restrictive interpretations of civil rights laws, wrote in National Review this summer that “perfection” would require going further: a Supreme Court decision that “the disparate-impact approach is unconstitutional since it is a requirement that decisions be made with an eye on race and achieving particular racial results.”
In its proposed rule, HUD has taken Justice Kennedy’s language and run with it. Fleshing out the requirement that plaintiffs show a “robust causal link” between the challenged policy or practice and the discriminatory impact, the rule requires that to avoid dismissal of their lawsuit, plaintiffs must be able to make a “plausible allegation” that the policy is “arbitrary, artificial, and unnecessary to achieve a valid interest or legitimate objective.” Cases relying on statistics to show discriminatory impact, cases to which banks and the mortgage industry have strongly objected for years, would be considerably harder to win. Additionally, plaintiffs would have to show not only that they suffered discrimination as individuals but that the challenged practice “has the effect of discriminating against a protected class as a group.” As I read the various clauses in the proposed rule, statistics would be all but useless in proving a case, but vitally necessary to prevent dismissal before trial.
Whatever becomes of the Fair Housing Act, a jewel of the Second Reconstruction of the 1960s, this episode reveals two important facets of the current moment. One is the extent to which the HUD has become this administration’s dirty underbelly. While the department’s nominal secretary, Dr. Ben Carson, is busy decorating his office suite, dedicated right-wing operatives fill the policy-level positions and come up with such gems as authorizing federally subsidized homeless shelters to deny admission to transgender people on religious grounds, and requiring the eviction from public housing of families with even one undocumented member. Policies like these don’t produce the shocking visuals of the administration’s heartless policies at the southern border (yes, I mean pictures of distraught or even dead children). They are simply cruel, and it’s galling that they are being carried out by an agency established in 1965 to help create President Lyndon Johnson’s Great Society. (It’s also worth noting that an administration that claims to be at war with the “administrative state” seems enraptured with administrative rule making to achieve policy goals for which it wouldn’t be able to get Congress’s consent.)
The current episode also illuminates the extent to which the Supreme Court is helping itself to the power it was willing, not so long ago, to cede to Congress. In its string of conservative interpretations of civil rights statutes in the late 1980s, the justices were content to let Congress push back and restore the laws to their prior meaning, as it did in the Civil Rights Act of 1991. But in suggesting, as Justice Kennedy, that disparate impact liability itself might violate the Constitution’s Equal Protection Clause — a prospect that never even came up during the 1989-1991 political struggle — the court is on the road to constitutionalizing a policy difference in a way that disables Congress and shuts down politics. (My colleague Reva B. Siegel explains this dynamic brilliantly in a recent article titled “The Constitutionalization of Disparate Impact.”)