WASHINGTON–The U.S. Supreme Court has agreed to review a lower court ruling that raises questions around the scope of the Fair Housing Act (FHA).
A number of trade organizations, including CUNA and NAFCU, had earlier filed an amicus brief in the case.
To be heard by the high court are the lawsuits City of Miami v. Bank of America and City of Miami v. Wells Fargo that involve a decision by the 11th Circuit Court. Miami brought suit against the two banks arguing that discriminatory actions against city residents entitles the city to damages for indirect harm. The city argued that foreclosures and other events stemming from unfavorable mortgages resulted in lost revenue from lower property taxes and other incurred expenses.
In the brief, CUNA, NAFCU and other groups warned that the lower court ruling could set a bad precedent that would allow other entities, such as neighboring residents, municipalities and even local businesses, to maintain suits against financial institutions, even if the entity never had any direct dealings with a credit union or bank. The financial trade groups called on the Supreme Court to reverse the 11th Circuit Court’s decision, and it cited other recent rulings from the Supreme Court itself, a lack of standing, and the unnecessary expansion of potential liability for lenders without any limiting factor.
Joining CUNA and NAFCU in the brief were the American Bankers Association, American Financial Services Association, Consumer Bankers Association, Consumer Mortgage Coalition, Housing Policy Council of the Financial Services Roundtable, Independent Community Bankers of America, Mortgage Bankers Association and National Association of Federal Credit Unions.