good morning mister morning your honor may it please the court when names robert blake come here on behalf of the city of miami gardens this is a continuing violations case under the fair housing act this is that it allows the plaintiff to meld past claims with the current claim into a single timely claim now what the so so not to preempt judge priors question but i suspect it said in the same direction you say past claims with current claims and by claims you mean actual violations within the acts of the described discriminatory practices that violate the act that violate the act so you have to have a free state we all agree then the act of a free standing violation within the statute limitations period before ok good all right good progress ok so i didn't realize that we were on common ground there yes it's not just some sort of vague allegation of something suspicious within the statutory period but an actual honest to goodness violation well the thing is it's not a full violation what you have to do is show that your your claims from the past so the ones that would be considered otherwise action i take you to mean something that violates the act and what i'm saying is it's a discriminatory practice that's all all we think we need to do we do not need to completely litigate the full fledged violation there's no mini trial of that violation that has to trigger the right to try to try the whole case a what is a discriminatory practice so it doesn't necessarily itself violate the act but may sort of open up the door and  dresses because it says that when you are dressed the statute of limitations you don't look at isolated instances but you look at the continuous practice and so this is the practice that is the violation the practice becomes  clear that it is a violation only when you look at it over the time and so therefore that's why haven's talks about a single instance of the same misbehavior is enough to to allow you to try the whole case otherwise what you're doing is you're basically creating the isolated case as a separate trial in order to get to the case you actually pleaded so that's where is there any evidence that a plain suffered an actual or was about to suffer an imminent harm that would establish standing well st of all this was a partial summary judgment action based on the allegations are one thing evidence is something else you have to always establish danding you can allege it but then you have to prove it to standing never never goes away i agree with that but at the same time the district court limited our discovery and only accepted evidence that had to do with the loans within the limitations period but if you want to look at injury are our operative complaint the rd amended complaint has attached to it exhibit a exhibit a list ten loans from prior to the limitations period that had gone to foreclosure and list the year by can continue diminishment of the property taxes that the city received from that property and what it demonstrates that even after the house was resold after foreclosure or taken over by the bank because they could not sell it it continued to diminish and it never recovered its full value that is the injury which this court recently in the city of miami case recognized is a proper proximate cause of of the claims that we make here and so that injury is in evidence that that's everything you're relying on is that exhibit a exhibit a does that but at same time the report of our expert actual injury here that that's actual injury but also the report of our expert notes that one of the two loans that we used in our match piers had already started to have problems that there was delinquencies in that loan and that was a precursor to foreclosure already speculative a pretty speculative it seems to me in terms of an imminent injury well again you had problems if you don't know whether it would have or cause we don't know what the effect would have been on property i mean values i mean that that's pretty remote it seems according to our expert that is the signal that it is headed towards foreclosure now that it's not guaranteed but that's enough to show some emergency and if the court had not made the bifurcating discovery and also not permitting any discovery beforehand in contrast to the case in philadelphia against a wall so far the case in oakland against wells fargo and miami gardens case against citi group where the judge allowed two years before the limitations period began you could then see the pattern and you could say that it's not speculative that it is indeed imminent and it is a regular occurrence so i think that again the bifurcation in this restricted manner is essentially what prevented this kind of thing that now because the district court was not inquiring into standing that was not put into issue and there was no reason just try to muster this evidence but this evidence exists in the record and as i said if you simply look at exhibit a which is evidence it shows that these homes had begin to diminish in value that the property taxes they paid diminished in the city suffered as a result so i think that that's sufficient to stand standing this is an injury in fact that goes precisely to the allegations that we made and there were no there was no contrary evidence t if i can then turn to the match pair evidence the court made the error of trying to say that the that really had to show statistical imbalance but of course if you're only showing only to show one loan that matched this the criteria that you use for showing your continuing violation then there's no way that you're going to show statistics imbalance instead both sets of experts used the same matched pair criteria which is valid for this purpose the thing is that the judge said that it had to be nearly identical using a boykin standard that this court has now rejected in the lewis case at the same time what he said was well it's obvious that the lending credits that were not revealed to us in the discovery but was revealed to us through the expert report that they pushed made all the difference but there was no criteria for how that lending credit calculates into the loan even on rebuttal there was no evidence no data that shows that this was a proper calculation in and as our rebuttal of our expert rebuttal report demonstrated that everything that they said still doesn't explain the difference and that the only logical explanation the only thing that a russian analysis would would show as the appropriate difference between the loans of these two match peers was a consideration of race it's a so but you don't and i guess you don't dispute as a matter of fact for purposes of applying the real standard now you know the lewis standard the fact that two of the borrowers got lender credits whereas the white borrower did not the two did not receive the promotional pricing that the that the white lender sort of locked into it's it looks like to me by virtue of the period when he asked  line and what what essentially wells fargo has asked us to do is accept the dixit of their expert that this is enough to explain the difference when our expert running through what is logically as an economist the kind of credit that that might mean doesn't explain the difference in the book but i think when you take that into account the minority borrower paid a higher price but i guess and louis for instance you know in louis we formulated a new a new standard we reject nearly identical formulating a new standard and then we took the facts before us and applied them you know as to whether or not these two were similarly situated in all material respect we said no and there was a dispute you know among the judges on the court but no one said like whoa we need like expert testimony are sort of new facts to determine whether or not these two comparatives are in fact valid comparatives we just sort of took the fact that were before us and applied and how is this different well because we do have the expert evidence here and the expert evidence shows that for all financial information but here you do have enough to show that the material differences are nonexistent thank you  draw about the merits of his claim from the fact that he has this case on a contingency basis well the fact that it's contingent i mean of course government lawyers can't have a financial stake in the outcome of the litigation  we don't mean to demean them for that it felt like an epithet it would read like an epithet i think it explained it helps understand why the city doesn't have any information of a violation of the fair housing act i mean if you look at the undisputed facts the city thirty six witness did know anything about a violation of the fair housing act this city community development director was was unable to identify any injury to those are all decent arguments on the merits i think i don't quite understand how mr peck's fear range meant affects them i don't take it any further i'm not i'm not claiming it does i think that's the right call so let me start with i'm going to talk about the standing issue  i'm tying that with the language of the statute itself us what they have to do here they have to show an actionable by lation of the fair housing act within the period of the statue of limitations that's what any plaintiff's burden is coming into a court congress established the time period which claims  defined as a person who claims to be injured injured by a discriminatory housing practice or believes that the person will be injured by a discriminatory housing practice that's about to occur so would be  dollars encompasses injury because of that you have to be a great person and be a great person you have to claim injury so what does discriminatory housing practice mean that's one of the things that we mr peck keeps talking about here and that's also defined in the in the to mean an act an act that violates one of the provisions of the law so the word practice in that in the in that context is not used to to emphasize continuing conduct it a plaintiff has no burden to coming into court to show that that that this is some practice that continues and continues they just have to show an act of discrimination that's what the word means and this record the city didn't put any evidence of injury before the court there's absolutely no evidence of injury that is not to exhibit a ten foreclosures well to two things one that wasn't put in evidence that's an allegation of the complaint and secondly we're talking about traceability here just prior and traceability in this context is not mean a trace link between a foreclosure and a reduction in property values it means a link between discrimination and reduction in property values  on their loans for many reasons in the city doesn't purport to have any information a didn't present any evidence in the court as to why borrowers might evidence of the effect of those ten loans on the property tax revenues or municipal spending of the city i'm sorry i was there any evidence no ok no there was no evidence and there's no evidence that any of those borrowers defaulted because of discrimination there's none obviously default for a number of reasons the city state it in the undisputed facts undisputed facts are in the record and document one hundred i'll cite them by the paragraph number of the fact the the city stipulates it's undisputed that the city had received no complaints from borrowers it's in that's undisputed fact number fourteen the city conceded to the district court at a hearing on december rd two thousand and fourteen the transcript is document twenty nine that that they didn't talk to any  borrowers before filing this lawsuit they even though they identified properties by address which obviously can easily be reverse engineered to identify specific people they didn't talk to those people they didn't have their permission to put their financial circumstances that issue they don't purport to know anything about why any borrower might have defaulted on as well mr peck talked about one of the borrowers see to his being late on his payments a couple of times but he doesn't know why they're late on the payments there's nothing if they're going to say that is an injury that traceable discriminatory loan the late payment would have to be because of some discriminatory term and also we talk about imminence there the undisputed facts in the record show that that loan to two  during the time period after the loan was originated the property values of that house increased by more than fifty percent increase by more than almost sixty two thousand dollars and what that means is that it makes it much less likely that there are other beer for closer on that property because of the borrower does have financial difficulties they can sell their home and walk away with a pocket of cash so there's no suggestion that anything was imminent here the city's lack of injury here is its own choosing it decided that it didn't have to present evidence of injury it wasn't going to present evidence of injury it did not present evidence of injury this is not anything that can be tied to discovery problems it is evidence of injury is is in the domain of the city wells fargo doesn't have information of how the city might have been harmed by it is by alleged loan the city said in paragraph sixty five of its complaint that that its injury could be shown by by readily available property tax records they could easily ascertain its injury by showing by using readily available property tax records but when it came to time for presenting proof they didn't present any proof of any injury even though they have it in their peck talked about the comparatives here and certainly we agree that the loose decision now guides this resolution but that just that requires that they be similar in all material respects and they are as you said just newsome there were two of the borrowers had under credits and the other didn't lend or credits are really important provisions that remove barriers to minority homeownership many low income borrowers don't have the financial resources to pay the cost of the loan and the c of the consumer financial protection bureau has to find lender credits to consumers as a trade off you can make a decision as lender credit just so i can get my simple mind around it sort of the opposite of like when i got my mortgage there were something called points and points allowed me to buy down the interest rate lender credits allow me to agree in advance for a higher interest rate in return for some cash up front basically whether their credit toward there's something different i'm points can be a borrower it can pay points to buy down the interest rate on yes or they can pay a point to that to the to the lender in connection with a loan when your credits are somewhat different it doesn't change the loan amount it just it provides that if the borrower agrees  wants to have the blender pay for their closing costs the lender can pay for their closing costs by the borrower except in a higher rate of interest ok entered in the industry wells fargo calls it credit for interest rate chosen but it's it's standard in the industry but it's the tree  either respect it's the choice of the borrower is a choice of the borrower on it and the hud has found this to be perfectly acceptable the c f p be recognizes that as an important provision in lending and also the c f p be as said you can't compare if you're going to compare  borrowers you can't compare borrowers with one of them having a lender credit in the other not having lender credit because it's one of their in the interest rate of the bar or who had under credit will appear to be artificially high we site that it paid at pages thirty dollars thirty one cents of our the brief before the court and in the lewis case we never i've never known that have been any any case you can't reengineer comparative either they either are similarly situated or they aren't similarly situated they are the in koreans and i mean i don't know of any case where anyone has even tried to say they could reengineer it but if you consider it in the employment context of if a borrower is rejected for a job and they claim they were judged for discriminatory reasons and the the response is that the borrower rejected had a lower level of education than the borrower high the borrower who was hired you don't reinjure neera to say well what if the borrower had similar levels of education what with the decision what with the result the in the thing i worry about a bit is that if we're going to require further evidence to demonstrate that comparative either are or are not similarly situated in all material respects then summary judgment is goes poof you'll never have summary judgement one of the americans is again because the parties whether there is expert testimony in a case or not they'll always just say like oh oh we dispute that these people are some of the situated that's right that's right in you in the lewis in the lewis case as you said before you made that determination that somebody could argue that they you could make them simply situated but the court applies that it's an element of the prime official case that the plaintiff must satisfy if they don't satisfy it the case in and particularly the consumer financial protection bureau has said that loan pricing is inherently complex that's cited in our room cited in our response to the motion for summary judgment and so it's inherently complex and you cautioned in lewis in the lewis decision as a panel of this court did previously in the boykins decision that you can't try to nd guess business decisions you can't try to recreate a pricing decision and see what it should have been in some hypothetical i prophetical situation in this is you know as you said in lewis the concept of comparative existed describe a winner what's a winner you don't have a winner in these kind of circumstances you have hypothetical situations you have what ifs that's not a winner so there's there's a lone situation though as you've just said being that this is a complex and astri and as judge newsome has talked about that if every borrower gets sort of a different menu of options and can choose from that i almost think this would be near impossible to find comparatives because every borrower is going to have different choices and those choices made by the borrower are going to affect the loan and and very different ways yes it may be difficult but this is just one of the ways there's a variety of ways this was an effort to prove intentional discrimination and i say they didn't present any evidence of disparate impact they didn't even a benefit i a policy that was subject to to the disparate impact approach but here they chose again if you were talking about intentional discrimination if you read their complaint you would think they'd be would be presenting direct evidence of discrimination they have some seventeen paragraphs of the complaint from paragraph twenty one dollars to thirty eight dollars talk about the damning evidence that's going to come from former employees of wells fargo with the record evidence of intentional discrimination that didn't materialize the only evidence they presented was one very weak affidavit or declaration from a former employee who said that if he if he had a difference but it's discrimination and not only discrimination but intentional discrimination so how in the world with what they've done here can you have any interest of intentional discrimination and finally i mean even the method of selecting th comparatives here was flawed from the beginning and dr ayres admitted in his final rebuttal report that his charge was just to find situations where the minority had a higher loan price and to ignore situations where the minority had a more favorable price the evidence dr ayres said cut in both directions in some situations under the very basic method that he used to compare borrowers in some situations some borrowers of minority borrow might have had a higher price in other situations of the same method would reach show that the minority borrower had a more favorable price so it's flawed in respects that go beyond what you dealt with in the lewis case so there's no further questions sit down thank you  mr peck you saved five minutes limitations question the scheduling order a document sixty one that the judge produced talked about only summary judgment with respect to the statute of limitations and in fact in his  order docket a number of two hundred and twenty one he ruth he indicated that he would refuse to entertain any evidence about anything that had to do with loans that were previously made that are outside the limitations period which is why we could not put in evidence like exhibit a because the the judge one of only to hear about evidence within the limitations period and injuries that occur from those specific loans your response to the motion for summary judgment knowledge that you had and it had to stablish an injury and this and you had to prove it and we said that what we would need to do that was the evidence that had been denied us we remain position throughout and because wells fargo despite what my friend just told you keeps a worldwide database of all the loans and foreclosures and issues with every single one of their loans  that database which oh mary kay woodward their representative testified in a deposition that we were seeking access to children that that we never received but that would allow us to make the connections that  were only making on the basis of publicly available data which doesn't always allow you to connect a borrower to the specific property and and the race and all the information that you need but using that public data we we did show that there are issues that there's imminence and that exhibit a is a demonstration of what we could have put in if we were permitted to do so which the judge did not allow now my friend also talked about he's you know our expert attempted to reengineer well this is not like a title seven case involving individuals where you have objective information about their level of education their years of experience or something like that this is a  economic model that has to be used and that our expert is an economist and a law professor and who was the expert used by the department of justice in their action on similar kinds of issues explained that it is very simple to do that and that the regression models that he was putting together which helped him identify not cherry pick but identify the kinds of loans that would be part of any kind of continuing violation regression analysis  were appropriate for that purpose and that indeed the lender credits which were supposed to simply take their word that this explains everything because they provide no data on simply does not explain the difference in price between  the minority bars and others now you dispute just so i'm clear his explanation to me of how lender credits basically work you're sort of acknowledging you're sort of accepting a higher rate in return for some help up front on that's generally how it works but that just doesn't sound like rock against me if you're offering the lender credits on a different basis based on race if you're offering the lender credits and they don't fully explain the differences in prices then it doesn't matter if that's the explanation and so that's part of the problem now asked the question whether summary judgment would ever be available well you know again if you're looking at an economic issue as we are here as opposed to objective criteria then if an expert does put in evidence and there is a competing views of experts then that is something that is properly going to go to the jury so is that how we kind of draw the sort of this a line around th is that you say in a tie in a title seven cases they're easy select so what if the parties say oh wait wait i actually think there's a factual dispute about whether these two people are valid comparatives we sort of ignore that but because this is like complicated economics and there's an expert report in the in the record there are summary judgment is not going to have i believe so because what you have here is is the joining of the factual issue by the presentation of data and that presentation of dat makes all the difference because that's the kind of analysis that the spank uses and bakes into whether they give you that mortgage in the st place yeah i guess the reason that sort of leaves me a little cold is that that feels sort of like viscerally understandable but i'm not really sure that there is like an analytical basis for distinguishing the like easy title seven case on the one hand where the parties care desperately about that and here's why i think you know that they think there is genuinely a factual dispute about the valid comparison between these people and because this is like a big bank and mortgages and it's hard and we've got experts that's different viscerally that feels ok but analytically i'm not really sure there's any difference and here's the reason why i think there's a difference at least in this instance a doctor errors who analysis was mis explains everything that to me makes it clear that there's a jury issue because again we've put in real evidence and they've just opined about it ok we understand your case where jar for the week