The Zone of Interest and the Fair Housing Act

May 2nd, 2017

In Bank of America Corp. v. Miami, the Court split 5-3 on the question of whether the City was an “aggrieved person” for purposes of the Fair Housing Act. Justice Breyer’s majority opinion concluded that Miami’s asserted injuries fall within the so-called “zone of interests” that the Fair Housing Act seeks to protect. The city’s claim was premised on the fact that Bank of America’s “predatory” lending practices disproportionately impacted minority residents in the city, and as a result the City suffered financial losses in the form of decreased tax base (to grossly oversimplify).

With respect to the question of Article III injury, the Court reaffirmed that with the Fair Housing Act and the “aggrieved person” doctrine, the Legislature “showed ‘a congressional intention to define standing as broadly as is permitted by Article III of the Constitution.'” To illustrate the breadth of the FHA, the Court cites three decisions from the Burger Court: Trafficante v. Metropolitan Life Ins. Co., 409 U. S. 205 (1972); Gladstone, Realtors v. Village of Bellwood, 441 U. S. 91 (1979); and Havens Realty Corp. v. Coleman, 455 U. S. 363 (1982):

Thus, we have held that the Act allows suits by white tenants claiming that they were deprived benefits from interracial associations when discriminatory rental practices kept minorities out of their apartment complex, Trafficante, 409 U. S., at 209–212; a village alleging that it lost tax revenue and had the racial balance of its community undermined by racial-steering practices, Gladstone, 441 U. S., at 110–111; and a nonprofit organization that spent money to combat housing discrimination, Havens Realty, 455 U. S., at 379.

Bank of America, the Court explained, thought that the holdings in these three cases were “exaggerated” and would create a “legal anomaly.” This is a charitable way of saying, wrong and out of step with the state of the Court’s recent jurisprudence. Breyer writes:

The Banks do not deny the broad reach of the words “aggrieved person” as defined in the FHA. But they do contend that those words nonetheless set boundaries that fall short of those the Constitution sets. Brief for Petition- ers in No. 15–1112, p. 12 (Brief for Wells Fargo); Brief for Petitioners in No. 15–1111, pp. 19–20 (Brief for Bank of America). The Court’s language in Trafficante, Gladstone, and Havens Realty, they argue, was exaggerated and unnecessary to decide the cases then before the Court. See Brief for Wells Fargo 19–23; Brief for Bank of America 27–33. Moreover, they warn that taking the Court’s words literally—providing everyone with constitutional standing a cause of action under the FHA—would produce a legal anomaly.

Justice Breyer’s treatment of this argument is, per his usual prose, confounding and frustrating.

We need not discuss the Banks’ argument at length, for even if we assume for argument’s sake that some form of it is valid, we nonetheless conclude that the City’s financial injuries fall within the zone of interests that the FHA protects. Our case law with respect to the FHA drives that conclusion.

He does not disagree with it, but, citing stare decisis, refuses to overrule those cases, yet, winds up saying that the present case here does not need to go as far as all of those cases went. This is peak Breyer.

What follows is a discussion of how the injuries alleged by Miami fall well within the core of injuries that were recognized in Gladstone. That is, the Village of Bellwood asserted a diminishment of its “tax base.” Miami asserted a similar injury to its property-tax revenue.

The upshot is that the City alleges economic injuries that arguably fall within the FHA’s zone of interests, as we have previously interpreted that statute.

Perhaps more importantly, the Court cited stare decisis–this may have been a coup to attract the Chief’s vote. Justice Breyer explained:

Principles of stare decisis compel our adherence to those precedents in this context.

In this regard, the FHA is unique, because the Court held that the similar phrase “person claiming to be aggrieved” in Title VII of the Civil Rights Act of 1964 does not have a similar reach. Justice Breyer explained:

After all, in Thompson, 562 U. S., at 175–177, we held that the words “‘person claiming to be aggrieved’” in Title VII of the Civil Rights Act of 1964, the employment discrimination statute, did not stretch that statute’s zone of interest to the limits of Article III. We reasoned that such an interpretation would produce farfetched results, for example, a shareholder in a company could bring a Title VII suit against the company for discriminatorily firing an employee.

This passage suggests that the Court is content to constrain this “exaggerated” approach for the Fair Housing Act, as a matter of stare decisis, and not extend it to other areas. This far, but no farther. Justice Thomas suggests as much in his dissent:

We have considered similar language in other statutes and reached the same conclusion. In Thompson v. North American Stainless, LP, 562 U. S. 170 (2011), for example, we considered Title VII’s private-enforcement provision, which provides that “‘a person claiming to be aggrieved’” may file an employment discrimination charge with the Equal Employment Opportunity Commission. Id., at 173 (quoting §2000e–5(b)). We unanimously concluded that Congress did not depart from the zone-of-interests limita- tion in Title VII by using that language. Id., at 175–178. And in Lexmark, we interpreted a provision of the Lanham Act that permitted “any person who believes that he or she is likely to be damaged by a defendant’s false adver- tising” to sue. 572 U. S., at ___ (slip op., at 10) (internal quotation marks omitted). Even when faced with the broader “any person” language, we expressly rejected the argument that the statute conferred a cause of action upon anyone claiming an Article III injury in fact. We observed that it was unlikely that “Congress meant to allow all factually injured plaintiffs to recover,” and we concluded that the zone-of-interests test was the “appropriate tool for determining who may invoke the cause of action” under the statute. Id., at ___, ___ (slip op., at 10, 11) (internal quotation marks omitted).

Finally, in Havens, one white and one black plaintiff sued after having posed as “testers,” for the purpose of “collect- ing evidence of unlawful steering practices.” 455 U. S., at 373. According to their complaint, the owner of an apart- ment complex had told the white plaintiff that apartments were available, but had told the black plaintiff that apartments were not. Id., at 368. The Court held that the white plaintiff could not sue, because he had been provided truthful information, but that the black plaintiff could sue, because the FHA requires truthful information about housing without regard to race. Id., at 374–375. In all three of these cases, the plaintiffs claimed injuries based on racial steering and segregation—interests that, under this Court’s precedents, at least arguably fall within the zone of interests that the FHA protects.

Perhaps the most redeeming aspect of this standing analysis is its narrowness. Justice Thomas in dissent noted the constrained nature of the majority’s holding:

The Court today reaches the opposite conclusion, resting entirely on the brief mention in Gladstone of the village’s asserted injury of reduced tax revenues, and on principles of stare decisis.

Although the Court’s reliance on Gladstone is misplaced, its opinion today is notable primarily for what it does not say. First, the Court conspicuously does not reaffirm the broad language from Trafficante, Gladstone, and Havens suggesting that Congress intended to permit any person with Article III standing to sue under the FHA.

The Court today decides that it “need not discuss” this argument because Gladstone and stare decisis compel the conclusion that Miami can sue. Ante, at 8. That conclusion is wrong, but at least it is narrow. Accordingly, it should not be read to authorize suits by local businesses alleging the same injuries that Miami alleges here.

For other statutory causes of action beyond the FHA, the Court would not be constrained by stare decisis. Justice Thomas observes:

But we have since described that language as “ill-considered” dictum leading to “absurd consequences.” Thompson, 562 U. S., at 176. And we have observed that the “holdings of those cases are compatible with the “‘zone of interests’ limitation” de- scribed in Thompson. Ibid. That limitation provides that a plaintiff may not sue when his “interests are so margin- ally related to or inconsistent with the purposes implicit in the statute that it cannot be assumed that Congress in- tended to permit the suit.” Id., at 178 (internal quotation marks omitted). It thus “exclud[es] plaintiffs who might technically be injured in an Article III sense but whose interests are unrelated to the statutory prohibitions.” Ibid.

The same is certainly true for claims brought directly under the Constitution, that lack the benefit of any statutory framework.

On that note, I’m aware that several of the lawyers who serve as counsel for plaintiff in CREW v. Trump wrote a lengthy reply to my earlier post on standing in the case. I didn’t reply, quite deliberately. While at least one of them is a prominent academic during the day, he also serves as a lawyer for the group litigating the case. Therefore, they all have an ethical duty not to advance knowledge, as a professor ought to, but instead, to win the case for their client. We must never conflate the role of scholar and advocate. For much the same reasons, I resist the urge to engage with members of the resistance, especially on Twitter. Such discourse is not a good use of my time, nor is it a good use of yours.