U.S. top court throws out ruling allowing Miami predatory lending suit

WASHINGTON The U.S. Supreme Court on Monday threw out a lower court ruling that had given Miami the green light to pursue lawsuits accusing major banks of predatory mortgage lending to black and Hispanic home buyers, but gave the city another chance to argue its case.

The court ruled 8-0 in tossing out the ruling in favor of Miami by the Atlanta-based 11th U.S. Circuit Court of Appeals. Bank of America Corp (BAC.N) and Wells Fargo Co (WFC.N) had challenged the decision to permit the lawsuits by the Florida city against the banks. The ruling by the justices also affects a related case brought by Miami against Citigroup Inc(C.N).

Writing for the court, Justice Stephen Breyer said Miami had the legal standing to sue the banks but needed to present more evidence that the injuries it claims to have suffered, which included lost property tax revenues, were tied to alleged violations of the federal Fair Housing Act.

Miami filed the cases in the aftermath of the U.S. financial crisis under the housing law, which prohibits discrimination in housing sale, rental and financing.

As a result of the banks’ alleged discriminatory lending, Miami said, property values declined and the city was forced to pay to repair and maintain properties that went into foreclosure.

Three justices said they would have thrown out the lawsuit altogether. Newly appointed Justice Neil Gorsuch, who was not on the court when the case was argued in November, did not participate.

(Reporting by Lawrence Hurley; Editing by Will Dunham)

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