Oakland, CA – The Ninth Circuit Court of Appeals upheld the City of Oakland’s right to sue Wells Fargo & Company and Wells Fargo Bank, N.A., for its racially discriminatory lending practices that preyed upon Black and Latinx residents and contributed to widespread foreclosures, harming City residents and the City itself. The Ninth Circuit rejected Wells Fargo’s contentions, agreeing that Oakland can move forward with its claims that the lender’s actions are responsible for lost property-tax revenue.
The City brought this lawsuit under the federal Fair Housing Act, the nation’s preeminent civil rights law that prohibits discrimination and predation in housing and lending on the basis of race, sex, religion, national origin, disability, color, and familial status. The Act requires that a plaintiff show a direct relationship between the action they claim injured them and the injury itself. In this case, that means Oakland must show that Wells Fargo’s discriminatory lending practices caused decreases in property taxes. Wells Fargo has vociferously denied that causal relationship, but the appellate court ruled that Oakland may continue to pursue that claim.
“Wells Fargo’s predatory, discriminatory actions harmed Oakland and its residents, plain and simple,” said City Attorney Barbara J. Parker. “We know their actions harmed our residents directly, by systematically basing loan terms on Black and Latinx residents’ race instead of their individual qualifications. And we know Wells Fargo harmed our city, by deflating property values and depriving the city of tax revenues that would fund essential city services. We are grateful that we will have our day in court to prove what we know to be true.”
The Court of Appeal decision can be found here.