Federal Judge Strikes Down HUD’s Disparate Impact Rule

Facts: Two nonprofit insurance trade associations filed a lawsuit against HUD, challenging its final rule providing for liability based on disparate impact under the Fair Housing Act (FHA). HUD had recently finalized regulations that were intended to codify how a disparate impact claim is established, including the respective burdens that the plaintiffs and defendants must carry. Under “disparate impact,” a person may be held liable for discriminatory conduct under the FHA without any showing of actual intent to discriminate.

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