The Massachusetts Attorney General’s Office (AGO) has joined a coalition of 18 attorneys general in filing an amicus brief urging a federal court to reject a challenge to the Department of Housing and Urban Development’s (HUD) Discriminatory Effects Rule. Under the Fair Housing Act, the rule holds insurers and other parties liable for housing practices that may appear neutral but are discriminatory or have a “disparate impact” on certain populations. The rule is being challenged by the homeowners insurance industry.
Courts have long recognized that the Fair Housing Act prohibits housing practices that, while not overtly discriminatory, have a disparate impact on individuals based on race, national origin, or other protected characteristics. However, a trade association representing property and casualty insurance companies sued to have HUD’s Discriminatory Effects Rule declared invalid as it applies to homeowners insurers. The insurers argued that HUD should have granted a blanket exemption to the rule and its failure to do so makes the rule invalid for multiple reasons, including because many states require insurers to rely only on market-based factors in making underwriting decisions.
The coalition filed the brief in the U.S. Court of Appeals for the District of Columbia Circuit, arguing that disparate-impact liability is a critical tool to fight housing discrimination, which is a major and ongoing cause of widespread residential segregation. The attorneys general explain that laws in many states already impose disparate-impact liability on entities in the housing industry, so the insurers are wrong to invoke state law as a basis for their requested exemption.
This is the Massachusetts Attorney General’s Office’s latest effort to advance fair housing for all. Just last month, AGO co-led a multistate coalition supporting a proposal to reduce barriers to HUD-assisted housing for people with criminal records.
Joining the Massachusetts Attorney General in filing the brief were Illinois Attorney General Kwame Raoul and District of Columbia Attorney General Brian Schwalb, along with attorneys general from Arizona, California, Colorado, Delaware, Maryland, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina Oregon Pennsylvania Rhode Island and Washington.
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