HUD Proposes Changes to its 2013 Disparate Impact Rule

On August 16, 2019, HUD published a proposed rule to amend its 2013 interpretation of the Fair Housing Act’s “disparate impact” standard. The 60-day public comment period on HUD’s proposal ends on October 18, 2019.

The proposed amended disparate impact rule provides a framework for establishing legal liability for facially neutral practices that have discriminatory effects on classes of persons protected under the Fair Housing Act. The proposed rule sets out a more complex burden shifting analysis that plaintiffs must meet in order to prevail on Fair Housing Act claims brought under a disparate impact theory of liability. The rule has no impact on determinations of intentional discrimination.

The proposed rule has drawn controversy from fair housing and civil rights advocates, who allege that it will make “disparate impact” claims virtually impossible to bring, despite the Supreme Court’s decision upholding them in its 2015 decision, Texas Department of Housing and Community Affairs v. Inclusive Communities Project. In that decision, the Court acknowledged the four decades of judicial decisions affirming disparate impact liability, as well as HUD’s 2013 disparate impact rule.

To read the proposed amended rule, click here.