- Miami Gardens, Fla. seeks an appeal in a case alleging Wells Fargo engaged in discriminatory lending practices
- A lower court dismissed the case in late June
A Florida city is attempting to revive a lawsuit alleging that Wells Fargo & Co. engaged in discriminatory lending practices that resulted in a wave of foreclosures, and a significant decrease in tax revenues.
The City of Miami Gardens, Fla. filed a notice of appeal with the U.S. Court of Appeals for the Eleventh Circuit on July 24 in a bid to overturn a lower court ruling that dismissed its fair lending case against Wells Fargo.
Lower Court Reasoning
That June 29 ruling by Judge Federico Moreno of the U.S. District Court for the Southern District of Florida found that Miami Gardens had not sufficiently argued that Wells Fargo charged higher mortgage rates to African-American and Hispanic borrowers compared with similarly situated white borrowers for the city’s disparate impact claims to continue.
Miami Gardens filed its case against Wells Fargo in June 2014. The suit alleges that the scandal-ridden San Francisco-based bank’s violations of the Fair Housing Act led to members of minority communities getting bad mortgages, and a subsequent wave of foreclosures during the 2008 financial crisis.
The case, like others filed by municipalities against big banks and mortgage lenders, was put on hold while the U.S. Supreme Court considered a similar suit filed by the city of Miami against Bank of America Corp.
The Supreme Court ruled in May 2017 that municipalities could sue lenders for fair lending violations, if they had the statistics to back up their disparate impact claims.
The case is City of Miami Gardens v. Wells Fargo & Co., S.D. Fla., 14 22203, 7/24/18.