Questions from Scalia give White House hope in Supreme Court housing discrimination cases

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WASHINGTON — The Obama administration may need the vote of a frequent conservative antagonist on the Supreme Court to preserve a decades-old strategy for fighting housing discrimination.

Justice Antonin Scalia on Wednesday appeared at times to side with the administration and civil rights groups during arguments over the reach of the landmark Fair Housing Act of 1968, a case that otherwise seemed to split the court along ideological lines.

Scalia seemed to agree with the court's four liberal justices that the law can be used to ban housing or lending practices without any proof of intent to discriminate. The court is considering a challenge from Texas officials to the use of so-called disparate impact lawsuits, which allege that even race-neutral lending or housing policies can have a harmful effect on minority groups.

Scalia said Congress seemed to have such lawsuits in mind when it passed the law in the 1960s, and later amendments in 1988, to eliminate segregation in housing.

"I find it hard to read those two together in any other way than there is such a thing as disparate impact," Scalia told Texas Solicitor General Scott Keller.

Civil rights organizations have speculated that conservatives on the court took up the case to knock out such lawsuits, which lower courts have uniformly allowed for 40 years. Their only hope is that Scalia or, perhaps Justice Anthony Kennedy, who is sometimes a swing vote, will side with the court's four liberals to uphold the practice.

Later in the hourlong argument, Scalia made comments critical of disparate impact when he told Michael Daniel, lawyer for a Texas fair housing group, that "racial disparity is not racial discrimination."

"The fact that the NFL is largely black players is not discrimination," Scalia said.

The issue has galvanized critics, including banks, mortgage companies and conservative groups, who say federal housing law should punish only intentional acts of discrimination. Two similar cases out of Minnesota and New Jersey reached the court in recent years, but those were settled in 2012 and 2013 just weeks before oral argument — in one case at the behest of the Obama administration.

The latest case involves an appeal from officials accused of awarding federal housing tax credits in a way that steered low-income housing to mostly poor, black neighborhoods in Dallas and generally kept the units out of wealthier white enclaves.

A Dallas-based fair housing group, Inclusive Communities Project Inc., sued the Texas Department of Housing and Community Development in 2008. The group alleged that agency policies were keeping Dallas neighborhoods segregated and denying blacks a chance to move into safer neighborhoods with better schools.

The housing advocacy group couldn't prove Texas officials were intentionally biased. But a federal appeals court said the group could use statistics to show that the policies still harmed black residents in violation of the Fair Housing Act.

Chief Justice John Roberts was among those expressing serious doubts about the tactic.

"It is very difficult to decide what impact is good and what impact is bad," Roberts said. What if one community wants to build low-income housing to revitalize minority neighborhoods, while another wants to integrate white areas, he asked. "Which is the bad thing to do?"

Solicitor General Donald Verrilli, who argued in favor of disparate impact, said both plans may ultimately pass muster. As in the Texas case, Verrilli said a community still has a chance to justify a race-neutral policy that has a negative impact on minorities.

But Roberts pressed Verrilli with the same question three times, complaining that he wasn't getting an answer.

Verrilli said such cases were outliers and said typical cases "in the heartland" such as zoning restrictions or occupancy rules are more straightforward.

In his only comment, Justice Anthony Kennedy said it seemed "very odd to me" that disparate impact could apply to either case.

Scott Keller, the Texas Solicitor General, stressed there was no clear language authorizing discriminatory-impact lawsuits when the housing law was passed in 1968. While employment discrimination laws seem to allow it, he said it is not explicitly covered under the Fair Housing Act.

But Justice Ruth Bader Ginsburg called that argument "a little artificial" because the theory was not mainstream until the Supreme Court approved its use for employment discrimination cases in 1971.

Justice Stephen Breyer noted that every appeals court to consider the question for the past 40 years has found disparate impact acceptable in the housing context.

"Why, when something is so well-established throughout the United States, should the court come in and change it?" he asked Keller.

Keller said disparate impact claims would essentially force the state to make race-conscious decisions to avoid liability.

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