Summary of Court Case Involving Racial Discrimination
On February 14, 2022, the Department filed a statement of interest in Austin, et al. v. Miller, et al. (N.D. Cal.), a private lawsuit alleging that the defendants violated the Fair Housing Act by discriminating on the basis of race in connection to a residential home appraisal. The statement of interest explains that appraisers may be liable under the Fair Housing Act and provide guidance on pleading and proof standards for Fair Housing Act claims.
Case Open Date: Monday, February 14, 2022
Case Name: Statement of Interest – Austin, et al. v. Miller, et al.
Tags: Fair Housing Act; FHA; motion to dismiss;
Industry Code: None
Component: Civil Rights Division Civil Rights – Housing and Civil Enforcement Section
Case Documents: Statement of Interest – Austin, et al. v. Miller, et al.
The Plaintiff, in this case, is a Black couple who received two appraisals on their home prior to refinancing – the first appraisal was $500,000 less than the second. They allege that the difference in the two appraisals was due to their race. Although the majority of complaints brought under the Fair Housing Act challenge the actions of rental housing providers; the FHA’s protections are much more expansive, including residential real estate transactions. These protections prohibit discrimination in the creation or sale of loans, or the sale, brokering, or appraisal of real property. 42 U.S.C. § 3605.
Studies have shown that there is still a significant disparity in home valuation in many areas around the county and that race is a common factor in these disparities. The current Administration has instructed its agencies to take a comprehensive approach to advance equality, including “[o]ngoing legacies of residential segregation and discrimination” and “a persistent undervaluation of properties owned by families of color.” The Department of Justice and HUD are actively pursuing these cases as part of their stated mission, which is shown by this Statement of Interest filed by the DOJ. However, while the disparity in appraisal values may be undisputed, the burden of proving that race was involved in the appraiser’s process is the hurdle.
It is crucial that all individuals involved in any real estate transaction are aware of these legal protections and seek the counsel of a fair housing attorney in order to avoid even the mere appearance of discrimination.