Supreme Court clears the way for cities, including L.A., to sue banks over foreclosure crisis
Offit Kurman Attorney Daniella Casseres Quoted in the Los Angeles Times
by: David G. Savage
The Supreme Court expanded the reach of federal housing law Monday, ruling that cities — including Los Angeles — can sue major banks for discriminatory lending practices that hurt low-income neighborhoods during the Great Recession.
The decision gives city leaders a potentially powerful weapon against lenders, including those who were accused of predatory practices that triggered the foreclosure crisis after 2008.
Until now, these legal claims faced an apparent obstacle. The Fair Housing Act forbids racial discrimination against “any person.” Lawyers for the banks said the law protected only people who suffered discrimination, not cities.
But by a 5-3 vote, the justices said cities can be an “aggrieved person” who can sue over the impact of housing discrimination on the city’s finances. Justice Stephen G. Breyer cited rulings from the 1970s that interpreted the civil rights law broadly, including by allowing city officials to sue real estate agents who were turning away black and Latino home buyers.
Daniella Casseres, a housing lawyer in New York, said the court’s ruling “gives local authorities a very powerful tool to continue defending against lending discrimination in a political environment where federal enforcement may soon be curbed.”
ABOUT DANIELLA CASSERES
Daniella Casseres’ legal practice focuses on laws and regulations governing mortgage lenders, mortgage brokers, financial institutions and consumer finance companies. She regularly advises clients on state and federal compliance laws and regulations including fair lending, advertising, licensing, privacy, TILA, RESPA, FHA, FCRA, and BSA requirements.
Ms. Casseres drafts and reviews wholesale lending and mortgage loan purchase agreements, and structures loan originator compensation for mortgage companies. She also represents clients in federal and state regulatory investigations, and assists in related litigation matters.
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