Judge throws out Obama administration housing discrimination rule

by MPA04 Nov 2014
A federal judge this week has tossed out a Department of Housing and Urban Development (HUD) regulation that was designed at making filing allegations of housing discrimination easier.

Judge Richard Leon of the D.C. Circuit Court called the Obama administration-issued rule an “another example of an administrative agency trying desperately to write into law that which Congress never intended to sanction.”

HUD finalized the controversial rule in February 2013 that stated discrimination could be proved using disparate impact, meaning looking at statistical analysis to see whether one demographic fares differently from another. The regulation is aimed at combating alleged discrimination by lenders, insurers, landlords and municipalities.

The case heard by Leon was brought by insurance industry groups, including The American Insurance Association and National Association of Mutual Insurance Cos. Last month, the Supreme Court agreed to look at the use of disparate impact in fair housing evaluation.

The Supreme Court will hear Texas Department of Housing and Community Affairs v. The Inclusive Communities Project, where the plaintiffs claim the TDHCA denies tax credit applications in majority-white and majority-Hispanic neighborhoods. At issue is whether Fair Housing Act lawsuits can be based on the disparate impact regulation. The mortgage industry argues that they should only be liable if they intend to discriminate.

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