DC court rejects insurers’ challenge to HUD disparate impact rules

Ten years after the case was first filed, after intervening regulatory flip-flops and the Supreme Court’s decision in Texas Department of Housing & Community Affairs v. Inclusive Communities Project, a D.C. district judge granted summary judgment to HUD yesterday in a challenge to its disparate-impact regulations brought by insurers. Limiting its analysis to the question of whether HUD’s rule conflicted with the Fair Housing Act as applied to insurers’ underwriting and rating practices, the court rejected arguments (1) that the rule requires “pervasive consideration protected characteristics” beyond that required by the FHA; (2) that the rule requires insurers to violate state laws; (3) that the rule allows claims based solely on statistical disparities; and (4) that the rule could require insurers to displace valid priorities.

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