General information

U.S. Supreme Court Disparate Impact Case to be Heard Next Month

The U.S. Supreme Court is scheduled to hear oral arguments in Mount Holly v. Mount Holly Citizens in Action Inc. on December 4. The court will decide whether a discrimination case brought under the federal Fair Housing Act may be based on “disparate impact” analysis, which is a discrimination action that does not require a showing either of disparate treatment or intent to discriminate on a prohibited basis.

It is sufficient to show that the neutral policy or action generates different and detrimental results while other reasonable alternatives exist that would create lesser effects. The outcome of the decision could have immediate application to the industry as it complies with the “qualified mortgage” rule, which has been criticized as encouraging lenders to limit mortgage loans only to highly qualified borrowers. Doing so could expose them to discrimination claims if there is a correlation between a protected class and credit standing, even if there is no intent to discriminate. CBA joined the ABA, which filed an amicus brief in support of the township of Mount Holly.

 

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