On September 21, 2015, the City of Oakland filed this lawsuit in the United States District Court for the Northern District of California. The plaintiff sued Wells Fargo & Co and Wells Fargo Bank NA under the Fair Housing Act, California Fair Employment and Housing Act, and California Government Code. The plaintiffs, represented by the Oakland City Attorney’s office, the Center for Constitutional Litigation, and private counsel, sought declaratory, injunctive, and compensatory relief as well as punitive damages and attorneys' fees. The plaintiffs claimed that the defendants had engaged in predatory mortgage strategies that disproportionately targeted minority communities. Specifically they claimed that the defendants had engaged in redlining and reverse redlining. This caused a disproportionate amount of foreclosures in minority communities and, as a result, reduced tax revenue for the City of Oakland, increased municipal expenditures, and neutralized the effectiveness of city fair-housing programs.

On November 13, 2015, the defendants filed a motion to dismiss, arguing that the predatory sub-prime loans that the plaintiffs referred to had ceased in 2008, placing their conduct outside the two year limitation period in the Fair Housing Act. The Court directed Oakland “to amend its complaint in view of the language now in Miami and give it your best shot with as much specificity as possible in terms of the kinds of damages that you are asserting that you contend are proximately caused by the [] alleged FHA violation.”

On August 15, 2017, the plaintiffs filed an amended complaint claiming that Wells Fargo’s predatory activity had continued through the time of filing and therefore was within the limitations of the Fair Housing Act.

On October 6, 2017, the defendants filed a motion to dismiss the first amended complaint, stating the plaintiffs had failed to properly show that the defendants had been the proximate cause of the injuries they alleged. On June 15, 2018, the Judge entered an order partially denying the defendants' motion to dismiss. Of the three injuries the plaintiffs alleged, the motion to dismiss was denied for injuries related to reduced tax revenue and increased municipal expenditures for the City of Oakland. However, for the second injury, the court held that only declaratory and injunctive relief could be pursued. The third injury—neutralization of the city’s fair-housing program—was dismissed without prejudice.

On February 28, 2019 the defendants filed an interlocutory appeal. This case is ongoing pending appeal (USCA No. 19−15169).

Carter Powers Beggs - 10/17/2019


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