Supreme Court Update: Texas Department of Housing and Community Affairs v. The Inclusive Communities Project (13-1371) and Johnson v. United States (13-7120)

June 29, 2015 Supreme Court Update

Greetings, Court Fans!

A few hours ago, the gavel banged a close to October Term 2014, after the release of the final three decisions of the term—Glossip v. Gross (14-7955), holding that the use of a particular drug in a three-drug execution cocktail likely does not violate the Eighth Amendment; Arizona State Legislature v. Arizona Independent Redistricting Commission (13-1314), holding that the Elections Clause of the Constitution does not forbid states from using independent commissions to adopt congressional districts; and Michigan v. EPA (14-46), holding that the EPA must consider costs before deciding whether environmental regulations are appropriate and necessary. We'll bring you summaries of those cases—and a round-up of the cases recently granted certiorari for OT15—later this week. Today, we'll look at the "B-sides" from Thursday and Friday—Texas Department of Housing and Community Affairs v. The Inclusive Communities Project (13-1371) and Johnson v. United States (13-7120)—each of which will have lasting significance, if not the same name-recognition of their respective "singles"—King v. Burwell and Obergefell v. Hodges.

First up, in Inclusive Communities, the Court delivered a narrow victory for civil rights plaintiffs in Fair Housing Act cases, holding that disparate-impact claims—not just claims of intentional discrimination—can be pursued under the Act. At the same time, Justice Kennedy's 5-4 majority opinion, joined by Ginsburg, Breyer, Sotomayor, and Kagan, established some significant limitations on the ability of plaintiffs to prevail on such claims.

The plaintiffs brought a disparate impact claim against the Texas housing authority that administered federal low-income housing tax credits, alleging that the authority granted too many credits for housing in predominantly black, inner-city neighborhoods and too few in white suburban neighborhoods. The plaintiffs claimed this had the effect of perpetuating segregated housing patterns and having a disparate impact on minorities. The Fifth Circuit—like every other circuit court to consider the question—held that disparate-impact claims like this one are cognizable under the FHA, and the Supreme Court granted cert to consider that question. This was the third time the Court had granted certiorari on the issue and many believed that it spelled doom for the continued viability of disparate-impact claims under the FHA. Indeed, on the two prior occasions that the Court had granted cert, the plaintiffs rushed to settle their claims, rather than allow the Court to make a potentially devastating decision.

As it turns out, these fears were mostly misplaced. The Court affirmed that disparate-impact claims are available under the FHA, albeit with certain restrictions. Justice Kennedy focused first on what he considered to be the relevant FHA language, which made it unlawful to refuse to sell, rent, or negotiate, "or otherwise make unavailable" any dwelling because of race or other protected characteristics. The phrase "otherwise make unavailable," he concluded, "refers to the consequences of an action rather than to the actor's intent," and indicates that Congress intended to allow disparate impact claims under the Act. Kennedy found support for that conclusion in the Court's earlier decisions in Griggs v. Duke Power Co. (1971), and Smith v. City of Jackson (2005), holding that Title VII and the Age Discrimination in Employment Act, respectively, permitted disparate impact claims. He found the relevant language of Title VII and the ADEA—which prohibited actions that "otherwise adversely affect" an employee's protected status under those two statutes—comparable to the "otherwise make unavailable" language in the FHA. In each of the statutes, the "otherwise" clauses "serve as catchall phrases looking to consequences, not intent."

Kennedy relied as well on a more controversial theory—congressional ratification of the position that the FHA permitted disparate impact claims. He reasoned that, when Congress amended the FHA in 1988, it was surely aware that every circuit court to have considered the question had held that the Act allowed such claims. By retaining the Act's operative language, Congress ratified the circuits' reading of the Act. The 1988 amendments also included three exemptions that, in Justice Kennedy's view, made sense only as exemptions from disparate impact liability. For example, one exemption made it clear that a housing authority was not subject to liability for actions taken against a person convicted of manufacturing or distributing illegal drugs. That safe haven would only be necessary to protect against claims alleging that such actions would have a disparate impact on protected groups. For Justice Kennedy, the exemptions further "signal that Congress ratified disparate-impact liability."

Having established that disparate impact claims should be permitted, Justice Kennedy proceeded to place some significant limits on claimants' ability to pursue those claims. He sought to avoid claims that could be viewed "as an attempt to second-guess which of two reasonable approaches a housing authority should follow." The FHA is not intended to put housing authorities in a "double bind," facing lawsuits whether they promote low-income housing in urban centers or suburban communities. To avoid this problem, housing authorities and private developers should be given "leeway" to consider a variety of factors and to select a policy of their choice, so long as they can "prove it is necessary to achieve a valid interest." The Court emphasized that liability based solely on a showing of a statistical disparity would raise serious constitutional questions. Therefore, a "robust causality requirement"—requiring plaintiffs to identify how a specific policy of the defendant caused the disparity—is necessary to ensure that a racial imbalance alone cannot establish a prima facie disparate impact case. Finally, Justice Kennedy admonished lower courts to frame remedial orders in disparate impact cases that focus on eliminating racial disparities through race-neutral means, to avoid the constitutional concerns inherent in imposing racial targets or quotas. That said, he also recognized that "mere awareness of race" in combating racial isolation in housing is not impermissible.

Justice Alito's dissent, on behalf of the Chief, Scalia and Thomas, attacked virtually every component of Justice Kennedy's analysis. Addressing the text of the FHA, Justice Alito focused not on the phrase "otherwise make unavailable," as the majority had, but on the words that follow: "because of race, color, religion, sex, familial status, or national origin." The words "because of" mean that Congress "outlawed the covered actions only when they are motivated by race or one of the other protected characteristics," i.e., it did "not authorize disparate impact suits." That conclusion was bolstered by the use of the words "because of" elsewhere in the FHA and in other statutes to indicate intentional conduct. According to Alito, nothing in the 1988 amendments to the FHA altered the meaning of the Act. Congress could not have ratified the view that the FHA encompassed disparate impact claims, because that view was still in dispute in 1988. While the federal circuits had taken that position, the Supreme Court had not yet decided the issue and the President was formally urging the Court to take the opposite stance. Therefore, Congress did not ratify anything by its inaction—an argument, Alito noted, the Supreme Court has repeatedly rejected in other contexts.

Though Kennedy had relied principally on the precedent of Griggs and Smith in rejecting the dissent's statutory-construction arguments, Alito argued that the majority opinion overstated their precedential significance. Griggs was based on the objectives of Title VII, not on the text that Justice Kennedy relied on, and the Supreme Court has never read Griggs as creating a rule for all antidiscrimination statutes. As for Smith, Justice Alito noted that Justice Scalia's decisive concurring vote in that case turned on specific language in the ADEA, not present in the FHA, that "arguably suggested disparate-impact liability." Finally, Justice Alito contended that the majority's decision would jeopardize programs designed to help the poor. In this case, for example, both options available to the Texas housing authority—using low-income credits to improve housing in low-income urban areas or to enable some minorities to move into higher-income neighborhoods—would achieve good results. But whichever option the authority chose could trigger a disparate-impact claim.

Justice Thomas penned his own dissent, to underscore that the foundation of the majority's analysis—Griggs—"is made of sand." He would "drop the pretense" that Griggs's construction of Title VII was legitimate, based as it was on an aggressive interpretation advanced by the EEOC and not on the language of the statute. At a minimum, he would cabin Griggs to Title VII and not inject its reasoning into the FHA and other statutes.

If Friday's gay-marriage ruling was predictable, the writing was even more boldly on the wall for the undercard, Johnson v. United States, where the Court—after many threats to do so—finally held that the residual clause of the Armed Career Criminal Act (ACCA) is unconstitutionally vague. ACCA imposes mandatory-minimum 15-year sentence upon a defendant with three prior convictions for a "violent felony," which is defined as any crime that has as an element the use or attempted use of physical force or "is burglary, arson, or extortion, involves use of explosives, or otherwise involves conduct that presents a serious potential risk of physical injury to another." The italicized text is the so-called "residual clause," which has confounded both the lower courts and the Supremes for years. The Supreme Court itself has attempted to give the clause meaning four times since 2007, without much success. All along, Justice Scalia has argued that the clause is unconstitutionally vague. On Friday, Scalia finally succeeded in convincing five other justices that the Due Process Clause forbids increasing a sentence based on the residual clause.

Samuel Johnson's case proved a good vehicle. A felon with a long criminal record, Johnson came under investigation by the FBI in 2010 due to his involvement with a white-supremacist group that the FBI suspected was planning to commit acts of terrorism. (Clearly, this was not Boswell's Johnson.) During the investigation, he showed agents his AK-47 rifle which, as a prior felon, he was not permitted to have. He was arrested and pleaded guilty to being a felon in possession. The Government requested an enhanced sentence under ACCA, arguing that three of Johnson's prior offenses—including unlawful possession of a short-barreled shotgun—qualified as violent felonies. The District Court agreed and the Eighth Circuit affirmed. The Court granted cert initially to decide whether possession of a short-barreled shotgun is necessarily a crime of violence under ACCA's residual clause. But, after argument on that question, the Court asked the parties to present additional briefing and argument on whether the residual clause is unconstitutionally vague. So, no; the outcome of this case was not in much doubt.

Writing for the Chief, Ginsburg, Breyer, Sotomayor, and Kagan (and joined in the result by Kennedy and Thomas), Scalia noted that "[t]wo features of the residual clause conspire to make it unconstitutionally vague." It provides no guidance on how to estimate the risk posed by a crime and at the same time leaves uncertainty about how much risk it takes for a crime to qualify as a violent felony. The problem is compounded by the fact that, in Taylor v. United States (1990), the Court ruled that ACCA requires courts to use a framework known as the "categorical approach" when deciding whether a given offense qualifies as a "violent felony." Under the categorical approach, the court looks not to the actual characteristics of the offense, as committed by the particular defendant, but rather to the "ordinary case." But "[h]ow does one go about deciding what kind of conduct the ‘ordinary case' of a crime involves? ‘A statistical analysis of the state reporter? A survey? Expert evidence? Google? Gut instinct?'" Looking at Johnson's case in particular, Scalia asked, with evident exasperation: "Do we confine our attention to the risk that the shotgun will go off by accident while in someone's possession? Or do we also consider the possibility that the person possessing the shotgun will later use it to commit a crime? The inclusion of burglary and extortion among the enumerated offenses suggests that a crime may qualify under the residual clause even if the physical injury is remote from the criminal act. But how remote is too remote?"

Ultimately, in Scalia's view, the only reason not to abandon the residual clause is that the Court has refused to do so in the past (over Scalia's objections). However, "the life of the law is experience. Nine years' experience trying to derive meaning from the residual clause convinces us that we have embarked upon a failed enterprise." While the purpose of stare decisis is to promote certainty and predictability, the Court's decisions on the residual clause have provided anything but. "Standing by [precedent] would undermine, rather than promote, the goals that stare decisis is meant to serve." Accordingly, the Court vacated Johnson's sentence and remanded for further proceedings.

Justice Thomas, joined in part by Kennedy, concurred in the judgment—i.e. that Johnson's sentence must be vacated—but would not dispatch with the residual clause. In his view, "[u]nder conventional principles of interpretation and our precedents, the offense of unlawfully possessing a short-barreled shotgun does not constitute a ‘violent felony' under the residual clause." He went on, however, (without Kennedy) to decry the entire doctrine of unconstitutional vagueness under the Due Process Clause. "Simply put, our vagueness doctrine shares an uncomfortable history with substantive due process, a judicially created doctrine lacking any basis in the Constitution." Prior to the late 19th Century (before the fall, in Thomas's view), courts addressed vagueness through a rule of strict construction of penal statutes—i.e. the rule of lenity—not a rule of constitutional law. It is only in the last 100 years that courts have felt comfortable nullifying statutes for vagueness on due process grounds. This "new" willingness, perhaps not coincidentally, coincided with the rise of substantive due process, a familiar bogeyman. When substantive due process was used to invalidate economic regulations, so was the vagueness doctrine; when substantive due process shifted toward protecting "discrete and insular minorities," so, too, did the vagueness doctrine. (Thomas noted that the first draft of Roe v. Wade struck down Texas's abortion ban as unconstitutionally vague because it was difficult to determine when the "life of the mother" exception might apply.) Thomas believes that the vagueness doctrine cannot be easily reconciled with the original understanding of the term "due process of law" and would thus regard the entire enterprise with (almost) as much suspicion as the substantive due process enterprise that gave breath to Friday's other opinion, Obergefell v. Hodges.

Justice Alito was the only dissenter. Like Thomas and Kennedy, he did not believe that the residual clause was unconstitutionally vague. In the first place, while stare decisis is not an inexorable command, "neither is it an empty Latin phrase. There must be good reasons for overruling a precedent, and there is none here." Setting precedent aside, the threshold for declaring a statute unconstitutionally vague is supposed to be high, and higher still for sentencing provisions, where concerns about "trap[ping] the innocent" have less force. "Scores" of federal statutes use terminology similar to the residual clause; "[i]f all of these laws are unconstitutionally vague, today's decision is not a blast from a sawed-off shotgun; it is a nuclear explosion." To the extent there has been a problem in application of the residual clause, Alito maintained, the fault is not with the clause, itself, but rather the Court's insistence on applying the "categorical approach," which prohibits judges from looking to whether the actual prior offenses of the actual defendant were violent felonies. Indeed, Alito wondered why, under the doctrine of constitutional avoidance, the Court did not simply abandon the judicially created categorical approach, rather than striking down the residual clause. Looking to the real-world conduct of Mr. Johnson, Alito would have no trouble concluding that his possession of a sawed-off shotgun qualifies as a "violent felony." Unlike Justice Thomas and Kennedy, however, he would have so held even under the categorical approach. Because sawed-off shotguns are not typically possessed by law-abiding citizens for lawful purposes, it is reasonably to conclude, even in the "ordinary case," that possession "presents a serious potential risk of physical injury to another."

So, in the end, eight justices agreed that the next chapter in the life of Johnson should involve re-sentencing without application of ACCA's fifteen-year mandatory minimum, while six have sealed the fate of the residual clause. What remains to be seen is what effect Friday's decision will have on prisoners already sentenced to mandatory terms thanks to the residual clause, a question that may well return to the Court in a year or two.

Right then. We're up to speed, save this morning's three decisions. Stay with us for the remainder of the week as we wrap up October Term 2014!