Magner v. Gallagher

Discrimination: (Whether a disparate impact claim may be brought under the Fair Housing Act (FHA) and, if so, what approach should the Court use to analyze such a claim.)

The City of Saint Paul began to "aggressively" enforce the city's housing codes. This active level of enforcement led to many written violations being issued to landlord's holding property predominately located in low-income housing areas where many of the residents were members of protected classes - with the highest protected class population in the African-American community. Appellants are a group of such landlords who argued that the city's method of enforcing the code created an undue impact on the landlords, which led to an increase in housing costs, a decrease in affordable housing, caused disparate treatment of protected classes as protected by FHA, had a disparate impact on members of protected classes as protected by FHA, violation of Equal Protection, and other constitutional claims.

FHA states that it is unlawful "to refuse to sell or rent... or otherwise make unavailable or dent, a dwelling to any person because of race, color, religion, sex familial status, or national origin." The Eighth Circuit found that Appellants offered enough evidence to demonstrate an issue surviving summary judgment that a protected class suffers a disproportionate adverse effect from the enforcement of a governmental housing policy. Once the Appellants make such a showing, the burden shifts back to the governmental entity to show a legitimate, non-discriminatory purpose for the policy. Here, Appellants conceded that enforcement of the housing has such purpose. Thus, the burden shifts back to the Appellants to demonstrate a viable alternative to satisfy the city's needs in a less discriminatory manner. Appellants pointed to a former city program, which worked with property owners to approach their property management in a more business-like fashion, work with the owner's to resolve issues, and develop a working relationship between the city and the property owners. The court found this to be a genuine issue of fact as to whether this former program would be a viable alternative to the city's "aggressive" enforcement.

The Supreme Court granted certiorari to determine if it is appropriate to bring a disparate impact claim under the Fair Housing Act and whether courts should apply the burden shifting scheme used by the Eighth Circuit, as well as two other circuits, or if courts should use a balancing approach utilized by four circuits, or a hybrid analysis used by two other circuits.