California Attorney General Rob Bonta has joined a coalition of 19 attorneys general in filing an amicus brief to support the U.S. Department of Housing and Urban Development’s (HUD) Discriminatory Effects Rule. This rule, under the federal Fair Housing Act (FHA), addresses housing practices that may seem neutral but are discriminatory, causing a "disparate impact" on certain groups.
The insurance industry, particularly the Property Casualty Insurers Association of America, is contesting this rule. They are appealing a March 2024 trial court decision that favored HUD. Attorney General Bonta had previously supported the rule in October 2023 before the trial court.
"Housing discrimination has no place in our country," stated Attorney General Bonta. He emphasized ongoing efforts to combat discrimination and support for individuals bringing disparate-impact claims against discrimination in the insurance sector.
The coalition argues that despite FHA's enactment, residential segregation persists, making disparate-impact liability essential for addressing housing discrimination. The brief highlights various forms of homeowner's insurance discrimination and cites a recent class action lawsuit against State Farm by Black plaintiffs over algorithmic racial disparities as an example.
While insurers claim state laws protect them from federal disparate-impact liability, the attorneys general argue that both federal law and state laws like California's work together to prevent intentional and disparate-impact discrimination. The U.S. Supreme Court's 2015 decision in Texas Department of Housing & Community Affairs v. Inclusive Communities Project, Inc., supports this availability under FHA.
A separate challenge by the National Association of Mutual Insurance Companies is pending before another court. On July 11, 2024, Attorney General Bonta joined another amicus brief supporting HUD in this separate case.
Attorney General Bonta joins colleagues from states including Arizona, Colorado, Delaware, Illinois, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon Pennsylvania Rhode Island Vermont Washington along with District Columbia.