New Article: How Patent Law Keeps the Hope of Fair Housing Alive for All, Even after Bank of America Corporation v. City of Miami

New Article: Jesse Snyder, How Patent Law Keeps the Hope of Fair Housing Alive for All, Even After Bank of America Corporation v. City of Miami, 21 Harv. Latino L. Rev. (2018). Abstract below:

In 2015, Circuit Judge Jimmie V. Reyna warned that the inexorable expansion of free speech protection could enable businesses to post signs like “SPICS NOT WELCOME,” simply because of their personal expressive prerogatives. Those words came from his dissent in In re Tam, which had an understated connotation that civil-rights legislation writ large could be destabilized and eventually extirpated. The en banc majority opinion authored by Circuit Judge Kimberly A. Moore was reticent about those musings. Although the Supreme Court in October Term 2016 affirmed Judge Moore’s views on free speech in the context of trademark law, it said nothing how those views affect civil rights or fair housing now that an entity can ostensibly trademark a business under a racial epithet. Returning to Judge Reyna’s point, if some barriers preventing a segregated society are removed, can other laws provide more than a makeweight defense to prevent minority communities from drifting into the margins?

The Court released Tam during the same term that it released Bank of America Corporation v. City of Miami, a May 1, 2017, opinion involving a city’s challenge to, among others, predatory lending to Latino-majority communities. Although Bank of America recognized that cities have Article III standing to sue under the Fair Housing Act for economic injuries suffered from predatory lending, the Supreme Court rejected the Eleventh Circuit’s more lenient causation standard, favoring proof of “some direct relation between the injury asserted and the injurious conduct alleged.” Doubtless the result could have been worse for cities suing on the premise that racially discriminatory lending caused municipal blight. The courthouse doors could have closed if the Court had declined to recognize Miami’s standing to bring a lawsuit under the Fair Housing Act. The visceral reaction to the approbated standard announced in Bank of America is that cities face a daunting task to prove causation.

This paper argues that patent law can inform analysis on and demonstrate how cities can prove causation between discriminatory lending practices and the blighted atmospherics of depressed housing. In three parts, the paper provides an overview of the Fair Housing Act, reviews Bank of America, and discusses how patent law can assist in proving whether predatory lending causes a city economic harm. Bank of America is an exemplar of how purported predation can harm Latino communities writ large and writ small. All is not forlorn for cities seeking relief from lending practices that discriminate among loan applicants. The auspice of a more exacting causation standard does not doom these lawsuits; it forces cities early on to perform the economic analysis necessary to prove actual damages. Patent law offers experts versed in detecting what attribute drives consumer decisions. Although loss of tax revenue from economic blight is fraught with complexity, economists have the tools in a proper adversarial system to present competing views on what caused a city’s downturn. Upon presentation of admissible evidence, whether the banks or cities prevail should turn on a jury’s decision about whether racially motivated predation proximately caused a city—and indirectly its residents—to suffer financial calamity.


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