The Supreme Court drew sig­nif­i­cant atten­tion for its gay mar­riage rul­ing last week, but anoth­er crit­i­cal­ly impor­tant deci­sion drew almost no atten­tion: On Thurs­day, A divid­ed SCO­TUS hand­ed a vic­to­ry to fair hous­ing advo­cates, pro­tect­ing a major tool for com­bat­ing hous­ing dis­crim­i­na­tion and segregation.

If an otherwise neutral housing policy leads to discrimination against people of a particular race, ethnicity or nationality, it can be challenged in court.

The court ruled in Texas Depart­ment of Hous­ing and Com­mu­ni­ty Affairs v. The Inclu­sive Com­mu­ni­ties Project that law­suits alleg­ing dis­crim­i­na­tion under the Fair Hous­ing Act don’t nec­es­sar­i­ly need to show a dis­crim­i­na­to­ry intent, only a dis­crim­i­na­to­ry effect, and that so-called ​“dis­parate impact” claims are allowed under the law. In short, if an oth­er­wise neu­tral hous­ing pol­i­cy leads to dis­crim­i­na­tion against peo­ple of a par­tic­u­lar race, eth­nic­i­ty or nation­al­i­ty, it can be chal­lenged in court.

Many civ­il rights and hous­ing groups were anx­ious­ly await­ing the result in this case, which risked undo­ing decades of estab­lished hous­ing rights law. But Jean Paul Schnap­per-Cast­eras, Spe­cial Coun­sel at the NAACP Legal Defense and Edu­ca­tion Fund, which wrote an ami­cus brief sup­port­ing the Inclu­sive Com­mu­ni­ties Project, described feel­ing excite­ment and relief over the court’s opin­ion Thursday.

“It’s a ful­some embrace of dis­parate impact and the Fair Hous­ing Act, and a pret­ty resound­ing win for civ­il rights law,” Schnap­per-Cast­eras said.

The case focused on whether ​“dis­parate impact” law­suits against dis­crim­i­na­to­ry hous­ing prac­tices were allowed under the fed­er­al Fair Hous­ing Act. Unlike with law­suits over inten­tion­al dis­crim­i­na­tion, ​“dis­parate impact” is a legal the­o­ry that allows a per­son, cor­po­ra­tion or gov­ern­ment enti­ty to be sued when their actions have a dis­crim­i­na­to­ry effect — even if unin­ten­tion­al­ly — on a cer­tain racial or eth­nic group.

Such law­suits have been used in the past to chal­lenge land­lords who have adopt­ed racial quo­tas in a hous­ing project or to over­turn zon­ing laws that lim­it the con­struc­tion of mul­ti­fam­i­ly hous­es. Writ­ing for the major­i­ty, Jus­tice Antho­ny Kennedy made it clear that such claims were not only allowed under the law but are a nec­es­sary bul­wark against the ongo­ing plight of seg­re­ga­tion in America’s major cities.

“De jure res­i­den­tial seg­re­ga­tion by race was declared uncon­sti­tu­tion­al almost a cen­tu­ry ago” in the 1917 case Buchanan v. War­ley, Jus­tice Kennedy wrote. But he not­ed ​“its ves­tiges remain today, inter­twined with the country’s eco­nom­ic and social life.”

How­ev­er, Kennedy acknowl­edged that the need to bal­ance deseg­re­ga­tion efforts against the needs of entre­pre­neurs and gov­ern­ment offi­cials, who require lat­i­tude to make good faith deci­sions about hous­ing devel­op­ment and zon­ing pol­i­cy with­out the con­stant fear of a law­suit. Thus, Kennedy declared, the main mea­sure of whether a pol­i­cy can be chal­lenged under a dis­parate impact the­o­ry should be whether that pol­i­cy is ​“arti­fi­cial, arbi­trary and unnecessary.”

What this phrase means for dis­parate impact cas­es in the near future will like­ly be a mat­ter of inter­pre­ta­tion for the low­er courts to decide.

Kennedy also not­ed the prac­ti­cal ben­e­fits of this legal tool. Dis­parate impact lia­bil­i­ty, he not­ed, has been used to over­turn laws like a for­mer Louisiana statute enact­ed after Hur­ri­cane Kat­ri­na, which restrict­ed apart­ment rentals to ​“blood rel­a­tives” in an area of New Orleans that was 88.3% white and 7.6% black.

“In this way, dis­parate-impact lia­bil­i­ty may pre­vent seg­re­gat­ed hous­ing pat­terns that might oth­er­wise result from covert and illic­it stereo­typ­ing,” Kennedy wrote.

The 78-year-old justice’s opin­ion paid par­tic­u­lar atten­tion to the his­to­ry of the FHA. Rely­ing on the law’s leg­isla­tive his­to­ry — includ­ing the results of the Kern­er Com­mis­sion, a pan­el set up under Pres­i­dent John­son to study dis­par­i­ties in the hous­ing mar­ket — and the con­text of the Civ­il Rights Era in which the FHA was passed, Kennedy deter­mined that the pur­pose of the law was to do far more than just stop fla­grant acts of dis­crim­i­na­tion: It should take a proac­tive role in pro­mot­ing racial justice.

“The FHA must play an impor­tant part in avoid­ing the Kern­er Commission’s grim prophe­cy that ‘[o]ur Nation is mov­ing toward two soci­eties, one black, one white — sep­a­rate and unequal,’ ” he wrote.

This case was not the first chal­lenge to the via­bil­i­ty of dis­parate impact claims. Two law­suits in the past decade seek­ing to under­mine this aspect of the Fair Hous­ing Act, one from St. Paul, Min­neso­ta, and one in Mount Hol­ly Town­ship, New Jer­sey, both set­tled out of court pri­or to reach­ing the justices.

In this case, the Inclu­sive Com­mu­ni­ties Project (ICP), a Texas non-prof­it that seeks to pro­mote inte­grat­ed hous­ing in the Dal­las area, was denied access to fed­er­al tax cred­its dis­trib­uted by the Texas Depart­ment of Hous­ing and Com­mu­ni­ty Affairs (DHCA) to build afford­able hous­ing in the most­ly-white Dal­las sub­urbs. The ICP argued that the Texas DHCA’s poli­cies had the effect of caus­ing seg­re­ga­tion by con­cen­trat­ing 92.29% of all low-income hous­ing cred­its in major­i­ty-minor­i­ty areas of the city.

Although the ICP suc­ceed­ed in get­ting the Supreme Court to side with their view of the Fair Hous­ing Act, the case was remand­ed back to the Fifth Cir­cuit Court of Appeals for fur­ther pro­ceed­ings and to deter­mine the mer­its of the group’s claim. The ICP did not respond to a request for comment.

In a state­ment, Texas Attor­ney Gen­er­al Ken Pax­ton, whose office argued on behalf of the state Texas DHCA, said that he was ​“dis­ap­point­ed” in the court’s deci­sion, which he called ​“over­reach­ing and misguided.”

“Today’s deci­sion places an unfair bur­den on land­lords, lenders and devel­op­ers, and will iron­i­cal­ly lead them to make their deci­sions based upon con­sid­er­a­tion of race,” Pax­ton said. Pax­ton also sug­gest­ed that, on remand to the Fifth Cir­cuit, the depart­ment will still be able to show that its rea­sons for not build­ing low-income hous­ing in large­ly white sub­urbs were root­ed in a ​“legit­i­mate objec­tive,” and that this case was ​“far from over.”

Respond­ing to Mr. Paxon’s com­ments, Pro­fes­sor Myron Orfield of the Uni­ver­si­ty of Min­neso­ta Law School said that con­ser­v­a­tives who chafe at the Court’s rul­ing should remem­ber that this fair hous­ing tool was once sup­port­ed by many on the right, includ­ing for­mer Pres­i­dent Richard Nixon, for­mer Michi­gan Gov­er­nor George Rom­ney, and for­mer Supreme Court Chief Jus­tice War­ren Berger.

He also not­ed that the Court’s opin­ion will like­ly set­tle any fight in the near-future over dis­parate impact’s via­bil­i­ty, like­ly ensur­ing that the law can con­tin­ue to be used to fight for racial jus­tice in hous­ing in the future. ​“It would be hard even if we had a very con­ser­v­a­tive pres­i­dent to appoint con­ser­v­a­tive jus­tices to over­turn this one,” Orfield said. ​“This should set­tle the issue for decades.”