Court’s housing bias showdown blocked

A small town in New Jersey pulled the plug Wednesday night on what was shaping up to be a major civil rights showdown before the U. S. Supreme Court.

A last- minute settlement between Mount Holly, N. J., ( pop. 9,536) and the predominantly black and Hispanic residents of a blighted housing development removed the case from the justices’ December docket.

It was a victory for civil rights groups content with federal housing laws, which prohibit sales, rentals, zoning and lending policies that have a “disparate impact” on minorities. They had feared the high court, with its 5- 4 conservative tilt, would reverse a series of federal appeals court rulings upholding the Fair Housing Act of 1968.

It also marks the second consecutive year in which a case testing whether disparate impact is sufficient, or if intentional discrimination must be shown, was settled out of court. The same thing happened last year in St. Paul with the assistance of the Obama administration.

Financial services industry leaders vowed to find another case — possibly the insurance industry’s challenge to new federal housing guidelines on discrimination — that will give the Supreme Court a fair shot at fair housing.

“The financial services industry needs to get one of these cases to the Supreme Court that will not settle first,” said Andrew Sandler, chairman of Buckley Sandler, a law firm that represents the industry. “We are highly confident that a decision by the Supreme Court on this issue will limit what we currently believe to be the improperly broad use of ‘ disparate impact.’ ”

The focus of the case is a 30- acre development of two- story, attached row houses in Mount Holly, just east of Philadelphia, that once housed 1,600 people but had become decrepit and crime- ridden. The town’s 11- year- old demolition effort has left fewer than 70 families, about half of whom sued, charging racial bias.

At issue is whether the Fair Housing Act requires intentional discrimination, or whether a policy’s impact is enough to make it illegal. The difference between intent and impact is at the root of many civil rights laws. In most cases, showing that minorities are disproportionately affected is sufficient.

Opponents — including developers, bankers, insurers and conservative interest groups — note the law does not refer to disparate impact.

GOOGLE The focus of the case was a 30- acre development of two- story, attached row houses in Mount Holly, N. J.