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Mount Holly settlement approved; dismissal of U.S. Supreme Court appeal to follow

Posted in Fair Lending

As expected, the Mount Holly town council voted last night to approve the settlement in Township of Mount Holly v. Mt. Holly Gardens Citizens in Action, Inc.  Coming just three weeks before the U.S. Supreme Court oral argument scheduled for December 4, the vote effectively ends the litigation and means a second important opportunity for clarity with respect to disparate impact claims under the Fair Housing Act and (by analogy) ECOA has been lost.

The Supreme Court is expected to dismiss the township’s appeal today or tomorrow upon the filing of a stipulation with the court seeking the dismissal.  That will be followed by a request to the New Jersey federal district court seeking the dismissal of the underlying case.  

With the end of the Mount Holly litigation, all eyes will be on the case pending in federal district court in Washington, D.C. challenging HUD’s final rule adopted in February 2013 that formalized HUD’s use of disparate impact liability under the FHA.  The complaint filed by two insurance industry trade groups includes a claim that the HUD rule is contrary to law because, based on the FHA’s plain language, the FHA only prohibits intentional discrimination.  That case was stayed pending the outcome in Mount Holly and is now expected to move forward.