Bank of America Corp. v. City of Miami

The Supreme Court addressed whether the City of Miami could sue Bank of America and Wells Fargo under the Fair Housing Act for damages caused by alleged discriminatory predatory lending. Miami claimed the banks targeted minority borrowers with risky mortgages, leading to widespread foreclosures that reduced property tax revenues and increased municipal costs for policing and fire services. The Court first ruled that the City qualifies as an "aggrieved person" under the Act, granting statutory standing. However, it held that the alleged financial injuries must satisfy a rigorous proximate-cause standard, requiring a direct relationship between the discriminatory conduct and the City's specific harms, not merely foreseeable ripple effects. The decision rejected the lenient foreseeability test used by the lower court and remanded the case for further proceedings consistent with this stricter standard.

The Supreme Court held that Miami is an "aggrieved person" with standing to sue, but that the Fair Housing Act requires a direct causal link between the violation and the injury. It vacated the lower court ruling and remanded the case for application of the correct proximate-cause standard.

Whether Miami qualifies as an "aggrieved person" under the Fair Housing Act and whether its claimed economic losses are proximately caused by the banks' alleged discriminatory lending practices.

The ruling tightened the requirements for municipal lawsuits against financial institutions, requiring cities to show a direct line of causation rather than general economic spillover. It limited the ability of local governments to recover damages for the broad social costs of predatory lending, influencing subsequent litigation and underscoring the importance of the proximate cause doctrine in civil rights and housing discrimination cases.