More Malfeasancey, More of the Time!
In a federal-level ploy of You scratch my back and I’ll scratch yours, Justice Department civil rights chief Thomas Perez arranged for the DOJ to drop a lawsuit against the city of St. Paul, Minnesota in exchange for the City’s agreement to drop a lawsuit against the feds…
The Magner v. Gallagher lawsuit was potentially explosive because, for the first time, it would have forced the Supreme Court to decide whether the 1968 Fair Housing Act (FHA) could be violated by a mere showing of “disparate impact.” In Magner, rental property owners argued that the City of Saint Paul’s “aggressive enforcement” of its housing codes affected minorities disproportionately because renters are disproportionately black, so requiring landlords to meet the housing code will increase their costs and decrease the number of units available to rent to minority tenants.
The question for the Supreme Court was whether such a disparate impact claim–where there is statistical evidence of impact on a certain race, but zero evidence of intent to discriminate– are recognized under the FHA. Most Court watchers predicted a ruling in favor of the City that disparate impact claims were impermissible under the FHA. This result was scary to the current DOJ, because it would put an end to its recent strategy of bringing FHA claims against mortgage companies based on mere statistical evidence that the lenders’ policies statistically affect minorities more than whites.
Bottom line? We won’t know the answer to this important question about the reach of the Fair Housing Act because Magner was so threatening to the current DOJ that it was willing to do anything– including dropping a very promising, big-dollar False Claims Act– in exchange for St. Paul’s dropping the Magner case.