Progressives and President Joe Biden himself profess outrage over the just-passed Texas abortion restriction law — not only because it constrains what the president has called the constitutional right to abortion but because of its enforcement provision. A law whose enforcement is based on a “private right of action,” we are told, amounts to vigilante justice.
Perhaps so.
But such an enforcement action was at the heart of the most consequential housing-related court case of recent years, which forced Westchester County, New York, to spend more than $30 million to build subsidized housing throughout the county — and set the stage for federal policy to use federal funds as a cudgel to force other communities to do the same. As the Wall Street Journal editorial board put it, Democrats have finally “discovered that a private right of action without injury is unfair.”
The name of the 2009 case tells the tale. Anti-Discrimination Center vs. Westchester County stemmed from a private right of action court suit filed by a private New York group, which not only forced a costly result of limited value but itself rewarded in the settlement to the tune of $7.5 million. In contrast to the Biden Justice Department’s stance toward the Texas law, the Obama Justice Department did not discourage ADC — it actually added its own efforts and resources toward the lucrative settlement.
The legal heart of the case against Westchester, a mixed-income, mixed-race suburban area of just under 1 million residents, notably did not rest directly on discrimination or fair housing.
It was rather built on a Civil War-era law: the False Claims Act, described by the Justice Department as “a federal statute originally enacted in 1863 in response to defense contractor fraud during the American Civil War.” The statute allows private citizens to file suits “on behalf of the government” against those who have allegedly defrauded it. The original law limited the value of a settlement to a citizen filing such a claim in court to $2,000 per claim. But penalties have since been linked to inflation. In the Westchester case, the settlement was determined by a federal judge — and that $7.5 million was diverted from any housing subsidy to the Anti-Discrimination Center and its lawyers.
In contrast to the Texas abortion law, which, whatever one’s opinion of it, focused on a clear and specific action, the Westchester settlement with the ADC opened the door to the use of an obscure private right of action for what can best be described as murky reasons: the county’s use of federal community development block grant funds. Those Department of Housing and Urban Development funds are specifically apportioned to jurisdictions in order to upgrade lower-income communities. Their fundamental purposes include support for social services and neighborhood infrastructure improvements.
But, per the Anti-Discrimination Center, Westchester had falsely claimed to be using the funds for fair housing purposes because, for instance, it had not explicitly informed its higher-income localities that they might adjust their zoning to permit the construction of low-income housing — nor had the county taken steps to ensure that it had a welcoming image for African Americans and Hispanics.
Never mind that, according to census data, some 17% of Westchester residents are black and 26% are Hispanic. Even in higher-income areas in the county, such as Scarsdale, black residents are represented as would be predicted by income.
The private right of action that led to the Westchester settlement did not, it’s worth noting, lead to more than any dramatic changes in those housing patterns: 700-plus new units is simply no big deal in a county with some 377,000 residences. Nor will deeply subsidized units help low-income households build wealth: Low-income rentals are just a new version of the public housing trap that has steered minorities away from ownership, lured by artificially low rents.
Yet both HUD and the Justice Department in the Obama administration had no qualms about effectively forcing dramatic policy change enforcement, and precedent, based on private right of action cases. The $7.5 million realized by the Anti-Discrimination Center dwarfs the $10,000 a private Texas citizen might receive for effectively informing on an abortion provider. And, crucially, the Westchester case opens the door for small advocacy groups to find specialty attorneys who can identify technical interpretations of the law that a sympathetic judge might regard as “false claims.”
None of this, in other words, began in Texas. It’s another case of situational ethics displayed by liberals.
Howard Husock is a senior fellow in domestic policy studies at the American Enterprise Institute, where he focuses on municipal government, urban housing policy, civil society, and philanthropy.
