FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

CITY OF OAKLAND, A Municipal 

Corporation,

Plaintiff-Appellee,

v.

WELLS FARGO & COMPANY; WELLS 

FARGO BANK, N.A.,

Defendants-Appellants.

No. 19-15169

D.C. No.

3:15-cv-04321-

EMC

OPINION

Appeal from the United States District Court

for the Northern District of California

Edward M. Chen, District Judge, Presiding

Argued and Submitted En Banc June 23, 2021

Pasadena, California

Filed September 28, 2021

Before: Sidney R. Thomas, Chief Judge, and M. Margaret 

McKeown, Kim McLane Wardlaw, Richard A. Paez, 

Consuelo M. Callahan, Sandra S. Ikuta, Jacqueline H. 

Nguyen, Andrew D. Hurwitz, Ryan D. Nelson, Bridget S. 

Bade, and Lawrence VanDyke, Circuit Judges.

Opinion by Judge McKeown
2 CITY OF OAKLAND V. WELLS FARGO & CO.

SUMMARY*

Fair Housing Act

The en banc court affirmed in part and reversed in part 

the district court’s partial grant and partial denial of Wells 

Fargo’s motion to dismiss and remanded for dismissal of the 

City of Oakland’s claims under the Fair Housing Act, 

alleging that Wells Fargo’s discriminatory lending practices 

caused higher default rates, which in turn triggered higher 

foreclosure rates that drove down the assessed value of 

properties, and which ultimately resulted in lost property tax 

revenue and increased municipal expenditures.

The en banc court held that under Bank of America 

Corp. v. City of Miami, 137 S. Ct. 1296 (2017), 

foreseeability alone is not sufficient to establish proximate 

cause under the Fair Housing Act, and there must be “some 

direct relation between the injury asserted and the injurious 

conduct alleged.” The en banc court held that the 

downstream “ripples of harm” from Wells Fargo’s alleged 

lending practices were too attenuated and traveled too far 

beyond Wells Fargo’s alleged misconduct to establish 

proximate cause.

The en banc court affirmed the district court’s dismissal 

of the City’s damages claim related to increased municipal 

expenditures and reversed the district court’s denial of Wells 

Fargo’s motion to dismiss the damages claim related to lost 

* This summary constitutes no part of the opinion of the court. It 

has been prepared by court staff for the convenience of the reader.
CITY OF OAKLAND V. WELLS FARGO & CO. 3

property tax revenue and claims for injunctive and 

declaratory relief.

The en banc court held that the City of Oakland did not 

sufficiently plead proximate cause for its reduced tax

revenue claim because its theory of harm went beyond the 

first step of the causal chain, which was the harm to minority 

buyers who received predatory loans. The en banc court 

concluded that the Fair Housing Act is not a statute that 

supports proximate cause for injuries further downstream, 

and the extension of proximate cause beyond the first step 

was not administratively possible and convenient. For the 

same reasons, the City also failed sufficiently to plead 

proximate cause for its increased municipal expenses claim.

The en banc court held that, in addition to claims for 

damages, the proximate-cause requirement in Miami also 

applies to injunctive and declaratory relief. It therefore 

reversed the district court’s judgment to the contrary.

COUNSEL

Neal Kumar Katyal (argued), Colleen Roh Sinzdak, 

Benjamin A. Field, and Sean Marotta, Hogan Lovells US 

LLP, Washington, D.C.; Paul F. Hancock and Olivia 

Kelman, K&L Gates LLP, Miami, Florida; Edward P. 

Sangster and Daniel W. Fox, K&L Gates LLP, San 

Francisco, California; Terry E. Sanchez, Munger Tolles & 

Olson LLP, Los Angeles, California; Bart H. Williams and 

Manuel F. Cachan, Proskauer Rose LLP, Los Angeles, 

California; for Defendants-Appellants.
4 CITY OF OAKLAND V. WELLS FARGO & CO.

Robert S. Peck (argued), Center for Constitutional Litigation 

P.C., Washington, D.C.; Barbara J. Parker, Oakland City 

Attorney; Maria Bee, Chief Assistant City Attorney; Office 

of the City Attorney, Oakland, California; Joel Liberson, 

Trial & Appellate Resources P.C., Torrance, California;

Yosef Peretz and Ruth Israely, Peretz & Associates, San 

Francisco, California; for Plaintiff-Appellee.

D. Scott Change, Housing Rights Center, Los Angeles, 

California; Jamie Crook, American Civil Liberties Union 

Foundation of Northern California, San Francisco, 

California; David Loy, American Civil Liberties Union of 

San Diego & Imperial Counties, San Diego, California; Julia 

Devanthéry, American Civil Liberties Union of Southern 

California, Los Angeles, California; Sandra S. Park and 

Alejandro Ortiz, American Civil Liberties Union 

Foundation, New York, New York; Morgan Williams, 

National Fair Housing Alliance, Washington, D.C.; Ajmel 

Quereshi, NAACP Legal Defense & Education Fund Inc., 

Washington, D.C.; for Amici Curiae American Civil 

Liberties Union Foundation, American Civil Liberties Union 

Foundation of Northern California, American Civil Liberties 

Union Foundation of Southern California, American Civil

Liberties Union of San Diego & Imperial Counties, AARP, 

NAACP Legal Defense & Educational Fund Inc., National

Fair Housing Alliance Inc., Poverty & Race Research Action 

Council, and Twelve Local Fair Housing Centers in the 

Ninth Circuit.

Dennis J. Herrera, City Attorney; Aileen M. McGrath, CoChief of Appellate Litigation; City Attorney’s Office, San 

Francisco, California; for Amicus Curiae City and County of 

San Francisco.
CITY OF OAKLAND V. WELLS FARGO & CO. 5

Michael L. Newman, Senior Assistant Attorney General; 

Christine Chuang, Supervising Deputy Attorney General; 

Shubhra Shivpuri and Srividya Panchalam; California 

Department of Justice, Oakland, California; for Amicus 

Curiae State of California.

Daniel P. Kearney Jr. and Matthew E. Vigeant, Wilmer 

Cutler Pickering Hale & Dorr LLP, Washington, D.C.; 

Steven P. Lehotsky and Emily J. Kennedy, U.S. Chamber 

Litigation Center, Washington, D.C.; for Amicus Curiae 

Chamber of Commerce of the United States of America.

Micha Star Liberty, Liberty Law, Oakland, California; 

Marcus J. Jackson and David M. Arbogast, Jackson 

Litigation, Carlsbad, California; for Amicus Curiae 

California Black Chamber of Commerce.

William Michael Cunningham, Washington, D.C., pro se 

Amicus Curiae.

OPINION

McKEOWN, Circuit Judge:

Only a few years ago, the Supreme Court addressed the 

proximate-cause standard of the Fair Housing Act (“FHA”),

42 U.S.C. §§ 3601–3619, 3631, in Bank of America Corp. v. 

City of Miami (“Miami”), 137 S. Ct. 1296 (2017). 

Emphasizing that “foreseeability alone” is not sufficient to 

establish proximate cause, the Court required “some direct 

relation between the injury asserted and the injurious 

conduct alleged.” Id. at 1305–06 (quoting Holmes v. Sec.

Inv. Prot. Corp., 503 U.S. 258, 268 (1992)). In 

acknowledging that “[t]he housing market is interconnected 
6 CITY OF OAKLAND V. WELLS FARGO & CO.

with economic and social life,” the Court observed that “[a] 

violation of the FHA may, therefore, ‘be expected to cause 

ripples of harm to flow’ far beyond the defendant’s 

misconduct.” Id. at 1306 (quoting Associated Gen. 

Contractors of Cal., Inc. v. Carpenters, 459 U.S. 519, 534 

(1983)). Nonetheless, the Court limited the legal 

consequences of those ripples: “Nothing in the statute 

suggests that Congress intended to provide a remedy 

wherever those ripples travel.” Id.

The City of Oakland (“Oakland”) claims that Wells 

Fargo’s discriminatory lending practices caused higher 

default rates, which in turn triggered higher foreclosure rates 

that drove down the assessed value of properties, and which 

ultimately resulted in lost property tax revenue and increased 

municipal expenditures. These downstream “ripples of 

harm” are too attenuated and travel too “far beyond” Wells 

Fargo’s alleged misconduct to establish proximate cause. Id. 

In this interlocutory appeal under 28 U.S.C. § 1292(b), we 

therefore reverse the district court’s partial denial of Wells 

Fargo’s motion to dismiss and remand for dismissal of the 

FHA claims.

I. BACKGROUND

A. FACTUAL BACKGROUND

According to Oakland’s First Amended Complaint (the 

“Complaint”), Wells Fargo violated the FHA by engaging in 

mortgage-lending practices that discriminated against 

African-American and Latino borrowers. Oakland alleges 

that Wells Fargo had a longstanding “policy and practice of 

steering minority borrowers” into mortgage loans with 

“terms that have higher costs and risk features than more 

favorable and less expensive loans for which the borrower 

was eligible and which are regularly issued to similarly 
CITY OF OAKLAND V. WELLS FARGO & CO. 7

situated white borrowers.” Specifically, Oakland claims that 

Wells Fargo’s practices resulted in giving a higher 

proportion of riskier “adjustable rate loans to minority 

borrowers than white borrowers” and giving “very few . . . 

conventional 30-year fixed rate mortgages” to minority 

borrowers.

According to Oakland, the discriminatory loans to 

minority borrowers increased default and foreclosure rates 

and decreased property values, which resulted in two 

economic harms: a decrease in property tax revenue and the 

simultaneous need for increased municipal expenditures to 

address public health and safety issues. Oakland also alleges 

that the discriminatory lending caused it non-economic 

injury by undermining its racial-integration goals.

To support its allegations that the discriminatory lending 

caused these harms, Oakland conducted a series of 

regression analyses. As Oakland notes, a regression analysis 

is a statistical method that examines “the relationship that 

exists in a set of data between a variable to be explained—

called the ‘dependent variable’—and one or more 

‘explanatory variables.’” Oakland “controll[ed] for 

borrower race and objective risk characteristics,” to ensure 

that borrowers being compared were similarly situated—that 

is, that they “posses[ed] similar underwriting and borrower 

characteristics.”

Based on Wells Fargo’s own lending history data, 

Oakland found that, between 2004 and 2013, AfricanAmerican and Latino borrowers were 2.583 and 3.312 times 

more likely, respectively, to receive loans with 

discriminatory terms than similarly situated white 

borrowers. Again controlling for “objective risk 

characteristics,” Oakland found that the discriminatory loans 

were 1.753 times more likely to result in foreclosure than 
8 CITY OF OAKLAND V. WELLS FARGO & CO.

non-discriminatory loans. These differences, according to 

Oakland, were statistically significant, meaning that there 

was less than a one percent chance that the observed 

differences would have occurred by chance. The Complaint 

alleges that the risky, expensive loans led to foreclosure at 

higher rates because “(1) the borrowers are required to make 

higher loan payments; and (2) as foreclosures begin to occur 

in a neighborhood, refinancing out of high-cost and high-risk 

loans becomes increasingly difficult due to suppressed loanto-value ratios.”

The higher default and foreclosure rates then allegedly 

decreased property values. The Complaint asserts that 

“[h]omes in foreclosure tend to experience a substantial 

decline in value,” which in turn reduces Oakland’s tax 

revenue.

The foreclosures also allegedly required Oakland to 

spend and divert resources to, among others, the police and 

fire departments, the Oakland Building Services Division 

and Code Enforcement, and the Oakland City Attorney’s 

Office, to “remediate blighted conditions.”

B. PROCEDURAL BACKGROUND

Oakland sued Wells Fargo for damages as well as 

declaratory and injunctive relief. While the case was 

pending in the district court, the Supreme Court decided 

Miami and clarified the requirements for proximate cause 

under the FHA. 137 S. Ct. at 1305–06. The district court 

accordingly instructed Oakland to amend its complaint in 

light of Miami. Oakland did so, and Wells Fargo moved to 

dismiss.

The district court dismissed Oakland’s claims as to 

increased municipal expenditures but allowed Oakland’s 
CITY OF OAKLAND V. WELLS FARGO & CO. 9

claims as to decreased property tax revenue to proceed. 

With respect to non-economic injuries, namely that 

discriminatory lending practices undermined Oakland’s 

racial-integration goals, the district court dismissed 

Oakland’s claim on standing grounds. Finally, the court 

allowed all claims for declaratory and injunctive relief to 

proceed, reasoning that Miami’s directness requirement 

“does not appear to extend” to these claims.

The district court certified two issues for interlocutory 

appeal under 28 U.S.C. § 1292(b): (1) whether Oakland’s 

claims for damages satisfy the FHA’s proximate-cause 

requirement, and (2) whether that proximate-cause 

requirement applies to claims for injunctive and declaratory 

relief.

A panel of this court affirmed the district court’s 

determination that Oakland sufficiently pleaded proximate 

cause for the decreased property tax revenue claim; affirmed 

the district court’s determination that Oakland failed to plead 

proximate cause for the increased municipal expenditures 

claim; and reversed the district court’s determination that 

Miami’s proximate-cause requirement did not apply to 

injunctive and declaratory relief. City of Oakland v. Wells 

Fargo & Co., 972 F.3d 1112, 1137 (9th Cir. 2020), vacated, 

993 F.3d 1077 (9th Cir. 2021). We voted to rehear the case 

en banc. City of Oakland v. Wells Fargo & Co., 993 F.3d 

1077 (9th Cir. 2021).

II. ANALYSIS

The FHA forbids “discriminat[ing] against any person in 

the terms, conditions, or privileges of sale or rental of a 

dwelling, or in the provision of services or facilities in 

connection therewith, because of race.” 42 U.S.C. 

§ 3604(b). Apropos of the lending practices at issue here, 
10 CITY OF OAKLAND V. WELLS FARGO & CO.

the statute also makes it unlawful for “any person or other 

entity whose business includes engaging in residential real 

estate-related transactions to discriminate against any person 

in making available such a transaction, or in the terms or 

conditions of such a transaction, because of race.” Id.

§ 3605(a). Under the FHA, any “aggrieved person” may file 

a civil action seeking damages for a violation of the statute. 

Id. §§ 3613(a)(1)(A), (c)(1). An “aggrieved person” is 

defined to include “any person who . . . claims to have been 

injured by a discriminatory housing practice.” Id. 

§ 3602(i)(1).

Benchmarking Oakland’s allegations against the 

requirements of the FHA, we review de novo whether 

Oakland adequately alleged proximate cause to survive a 

motion to dismiss under Federal Rule of Civil Procedure

12(b)(6). See Pakootas v. Teck Cominco Metals, Ltd., 

830 F.3d 975, 980 (9th Cir. 2016). To answer this question,

we credit Oakland’s well-pleaded allegations as true and

look to the Court’s guidance in Miami, along with its related 

proximate cause analysis in Lexmark International, Inc. v. 

Static Control Components, Inc., 572 U.S. 118 (2014), and

Holmes v. Securities Investor Protection Corp., 503 U.S. 

258 (1992), among other cases.

A. UNDER MIAMI, PROXIMATE CAUSE UNDER THE 

FHA REQUIRES A DIRECT RELATION BETWEEN 

WELLS FARGO’S CHALLENGED PRACTICES AND 

OAKLAND’S ASSERTED INJURIES

In Miami, the Supreme Court considered allegations 

almost identical to those made here. 137 S. Ct. at 1300–01. 

The City of Miami alleged a series of predatory 

discriminatory practices by Bank of America and Wells 

Fargo, which resulted in higher default and foreclosure rates

for minority borrowers than for similarly situated white 
CITY OF OAKLAND V. WELLS FARGO & CO. 11

borrowers. Id. In turn, “[h]igher foreclosure rates lowered 

property values and diminished property-tax revenue.” Id.

at 1301–02. The “[h]igher foreclosure rates—especially 

when accompanied by vacancies—also increased demand 

for municipal services” necessary “to remedy blight and 

unsafe and dangerous conditions.” Id. at 1302.

The Eleventh Circuit held that Miami had adequately 

pleaded proximate cause because the harm to the city was a 

foreseeable result of the discriminatory lending. City of 

Miami v. Bank of Am. Corp., 800 F.3d 1262, 1282 (11th Cir. 

2015), vacated, 137 S. Ct. 1296 (2017). The Supreme Court

squarely rejected the Eleventh Circuit’s foreseeability 

standard, explaining that “[i]n the context of the FHA, 

foreseeability alone does not ensure the close connection that 

proximate cause requires.” 137 S. Ct. at 1306. Instead, the 

Court instructed that the proper standard was the more 

stringent “direct relation” standard, which requires “some 

direct relation between the injury asserted and the injurious 

conduct alleged.” Id. (quoting Holmes, 503 U.S. at 268). 

This direct-relation standard previously had been applied by 

the Court to a number of common-law based statutes. See, 

e.g., Lexmark, 572 U.S. at 132–40 (applying the directrelation standard to a claim brought under the Lanham Act); 

Holmes, 503 U.S. at 268–74 (same, under the Racketeer 

Influenced and Corrupt Organizations Act (“RICO”));

Associated Gen. Contractors of Cal., Inc., 459 U.S. at 540–

46 (same, under the Clayton Act). Citing to these cases, 

Miami held that the FHA “is no exception,” because a 

damages claim under the FHA is “akin to a ‘tort action.’” 

137 S. Ct. at 1305 (quoting Meyer v. Holley, 537 U.S. 280, 

285 (2003)).

In explaining the mechanics of the direct-relation 

standard, the Court began by reaffirming “[t]he general 
12 CITY OF OAKLAND V. WELLS FARGO & CO.

tendency . . . not to go beyond the first step” of the causal 

chain. Id. at 1306 (internal quotation marks omitted) 

(quoting Hemi Grp., LLC v. City of New York, 559 U.S. 1, 

10 (2010)). The Court then noted, however, that “[w]hat 

falls within that ‘first step’ depends in part on the ‘nature of 

the statutory cause of action’ and an assessment ‘of what is 

administratively possible and convenient.’” Id. (first 

quoting Lexmark, 572 U.S. at 133; and then Holmes, 

503 U.S. at 268).

Although the parties urged the Court to delineate 

“precise boundaries” and to determine whether Miami’s 

financial injuries met the direct-relation standard, the Court 

declined to do so and left it to “the lower courts [to] define, 

in the first instance, the contours of proximate cause under 

the FHA.” Id. On remand, the Eleventh Circuit revisited the 

case and issued an opinion. City of Miami v. Wells Fargo & 

Co., 923 F.3d 1260 (11th Cir. 2019), vacated as moot, 140 S. 

Ct. 1259 (2020). However, while a petition for writ of 

certiorari was pending, Miami voluntarily dismissed its 

lawsuit against Bank of America and other financial 

institutions. See City of Miami v. Bank of Am. Corp., No. 

13-cv-24506, slip op. at 1 (S.D. Fla. Jan. 30, 2020) (order 

granting plaintiff’s unopposed motion for dismissal with 

prejudice); City of Miami v. Wells Fargo & Co., No. 13-cv24508, slip op. at 1 (S.D. Fla. Jan. 30, 2020) (order granting 

plaintiff’s unopposed motion for dismissal with prejudice). 

The Court granted the petition and vacated the Eleventh 

Circuit’s judgment as moot. Wells Fargo & Co. v. City of 

Miami, 140 S. Ct. 1259 (2020). Although there is no circuit 

precedent on the proximate-cause standard under the FHA, 

the Supreme Court’s binding directives in Miami and its 

earlier proximate-cause jurisprudence drive our analysis.
CITY OF OAKLAND V. WELLS FARGO & CO. 13

B. OAKLAND DID NOT SUFFICIENTLY PLEAD 

PROXIMATE CAUSE FOR ITS REDUCED TAX 

REVENUE CLAIM

We begin where Miami began, with “[t]he general 

tendency . . . not to go beyond the first step.” 137 S. Ct. 

at 1306 (internal quotation marks and citation omitted). 

There is no question that Oakland’s theory of harm goes 

beyond the first step—the harm to minority borrowers who 

receive predatory loans. Oakland’s theory of harm runs far 

beyond that—to depressed housing values, and ultimately to 

reduced tax revenue and increased municipal expenditures. 

Oakland thus fails “a strict application of the ‘general 

tendency’ not to stretch proximate causation ‘beyond the 

first step.’” Lexmark, 572 U.S. at 139 (quoting Holmes, 

503 U.S. at 271).

Oakland’s hope in this case—which turns out to be 

misplaced—is that there is some basis not to “conform[] . . .

to the general tendency” not to go beyond the first step. 

Holmes, 503 U.S. at 272. Indeed, there is some give in the 

joints as to “[w]hat falls within that ‘first step.’” 137 S. Ct.

at 1306 (quoting Lexmark, 572 U.S. at 139). That is, there 

are times when a proximate-cause analysis may 

appropriately diverge from the general tendency. 

Historically, the Court has framed this as going “beyond the 

first step,” rather than expanding “what falls within” it. See, 

e.g., Lexmark, 572 U.S. at 139 (“beyond the first step” 

(citation omitted)); Hemi Grp., 559 U.S. at 10 (same); 

Holmes, 503 U.S. at 271 (same). We see no meaningful 

distinction between the historical framing of going “beyond” 

the first step and Miami’s framing of expanding what is 

considered to be “within” the first step. It is clear that both 

of these exceptions fall outside the norm and hinge on a 

statute-specific textual analysis of the “conduct the statute 
14 CITY OF OAKLAND V. WELLS FARGO & CO.

prohibits.” Lexmark, 572 U.S. at 133. Whether conceived 

as an expansive first step or an extension beyond the first 

step, what matters doctrinally is that some direct relation is 

required and that, under certain limited circumstances, 

courts need not “conform[]” to the general first-step 

tendency. Holmes, 503 U.S. at 271–72.

The Court in Miami articulated that these circumstances 

rest in part on two considerations: “the ‘nature of the 

statutory cause of action’ and an assessment ‘of what is 

administratively possible and convenient.’” 137 S. Ct. 

at 1306 (first quoting Lexmark, 572 U.S. at 133; and then 

Holmes, 503 U.S. at 268). We thus turn to these 

considerations.

1. The Nature of the Statutory Cause of Action

The nature of a particular statutory cause of action 

implicates whether proximate cause can extend beyond the 

first step because some statutes support proximate cause for 

injuries further downstream. While the Supreme Court in 

Miami did not directly answer whether the FHA is such a 

statute, in our view the principles in Miami require us to 

conclude that it is not.

To begin, we examine the “injurious conduct” 

encompassed by the FHA. Id. (quoting Holmes, 503 U.S. 

at 268). According to Miami, the FHA prohibits “lending to 

minority borrowers on worse terms than equally 

creditworthy nonminority borrowers and inducing defaults 

by failing to extend refinancing and loan modifications to 

minority borrowers on fair terms.” Id. at 1305. The harm 

that the statute guards against—issuing discriminatory loans 

that result in a default because of failure to refinance or 

modify the loans on fair terms—is thus situated at the first 

step: the issuance of the discriminatory loan. The harm to 
CITY OF OAKLAND V. WELLS FARGO & CO. 15

the borrower has a clear direct relation to conduct prohibited 

by the FHA.

By contrast, the situations in which the Court has 

countenanced a finding of proximate cause beyond the first 

step arise from statutes that themselves encompass harm 

beyond the first step. Two key cases illustrate this principle: 

Bridge v. Phoenix Bond & Indemnity Co., 553 U.S. 639 

(2008) and Lexmark, 572 U.S. 118.

In Bridge, the Court held that proximate cause extended 

beyond the first step for a RICO claim predicated on mail 

fraud. 553 U.S. at 661. The case arose from a county auction 

of tax liens. Id. at 642–44. Whenever there was a tie 

between the highest bidders, the county awarded the lien 

based on a fair rotation of which bidder received the last lien 

from a tie bid. Id. at 642–43. To game the system, bidders 

began using multiple agents. Id. at 643. The county banned 

that practice, but certain bidders allegedly continued using 

multiple agents and filed false attestations of compliance. 

Id. at 643–44. Upon learning of this scheme, competing 

bidders sued, alleging that the fraud to the county harmed 

their chances of being awarded liens. Id. The wrinkle from 

a directness standpoint was that the first step was the false 

attestation to the county. The offending bidders challenged 

both standing and proximate cause on the ground that the 

competing bidders had not relied on the false attestation. Id.

at 645–46. The harm to the competing bidders did not come 

until later in the sequence. Id.

Nonetheless, based on the nature of the mail fraud 

statute, the Court held that reliance on the misrepresentations 

was not “a prerequisite to establishing proximate causation.”

Id. at 661. Key to the Court’s analysis was a parsing of the 

statute and its conclusion that the statutory offense of mail 

fraud “does not require proof of reliance.” Id. at 656. In this 
16 CITY OF OAKLAND V. WELLS FARGO & CO.

way, the mail fraud statute permits proximate cause to 

extend beyond the first step to reach the harmed party—the 

competing bidder. That extension was particularly 

necessary in Bridge, because the first-step party (the county) 

suffered no injury. Id. at 658 (explaining that “respondents 

and other losing bidders were the only parties injured by 

petitioners’ misrepresentations”). Contrasting this situation 

with Holmes and Anza v. Ideal Steel Supply Corp., 547 U.S. 

451 (2006), the Court underscored that the competing 

bidders’ “alleged injury—the loss of valuable liens—is the 

direct result of [the] fraud” and “there are no independent 

factors that account for [the] injury.” Bridge, 553 U.S. 

at 658.

Just two years later, in Hemi Group, the Court took the 

opportunity to highlight the principles from Bridge. 

559 U.S. at 1. Under RICO, New York City sued the Hemi 

Group, an online cigarette seller, for failure to file certain 

reports of sales. Id. at 4. New York’s causal theory was that 

without those reports, it was unable to go after direct 

cigarette purchasers to collect tax revenue. Id. This theory 

was rejected because the city could not show that the failure 

to file reports “led directly to its injuries.” Id. at 14. The 

city’s effort to rely on Bridge fell flat. Id. at 14–15. Unlike 

the theory in Bridge, “the [c]ity’s theory . . . [was] anything 

but straightforward: Multiple steps . . . separate[d] the 

alleged fraud from the asserted injury.” Id. at 15. The 

Court’s explanation that New York’s theory “rest[ed] on the 

independent actions of third and even fourth parties,” id., 

echoes the attenuated, multi-step causal chain proffered by 

Oakland.

Consistent with Bridge, the Court in Lexmark considered 

another statute that permits proximate cause to extend 

beyond the first step: the false-advertising provisions of the 
CITY OF OAKLAND V. WELLS FARGO & CO. 17

Lanham Act. 572 U.S 118. Lexmark, a manufacturer and 

seller of laser printers and toner cartridges, dominated the 

market for cartridges compatible with its printers. Id. 

at 120–21. The question was whether Lexmark’s alleged 

false advertising, which directly harmed certain printer 

cartridge “remanufacturing” companies, also proximately 

caused harm to Static Control, a company that made 

microchips exclusively for the remanufacturing companies.1 

Id. at 132–40. Reasoning that proximate cause was satisfied, 

the Court rejected the view that consumer deception is an 

intervening step that breaks the proximate cause link. Id. 

at 133, 140.

In coming to this conclusion, the Court examined the 

common-law origins of the Lanham Act’s prohibition on 

false advertising, which justified a more flexible approach. 

Id. at 133. Typically, the first step in a false advertising 

claim results from injuries “suffered by consumers who are 

deceived by the advertising.” Id. But, as the Court put it, 

because the Lanham Act “authorizes suit only for 

commercial injuries,” and because deceived consumers do 

not suffer commercial injuries, “the intervening step of 

consumer deception is not fatal to the showing of proximate 

causation required by the statute.” Id. (citation omitted).

Importantly, the Court did not jettison the directness 

requirement; rather, it noted that “a plaintiff can be directly 

injured by a misrepresentation even where ‘a third party, and 

not the plaintiff, . . . relied on’ it.” Id. (quoting Bridge, 

553 U.S. at 656). Even so, “the harm alleged” still must have 

1 Remanufacturers “acquire used Lexmark toner cartridges, 

refurbish them, and sell them in competition with new and refurbished 

cartridges sold by Lexmark.” Id. at 121.
18 CITY OF OAKLAND V. WELLS FARGO & CO.

“a sufficiently close connection to the conduct the statute 

prohibits.” Id.

Lexmark further held that proximate cause could be 

extended beyond the direct competitor to another injured 

party, in that case Static Control, because the harm flowed 

automatically from the direct competitor remanufacturing 

companies to Static Control. Id. at 139–40. “[I]f the 

remanufacturers sold 10,000 fewer refurbished cartridges

because of Lexmark’s false advertising, then it would follow 

more or less automatically that Static Control sold 10,000 

fewer microchips for the same reason . . . .” Id. at 140 

(emphasis added). Because there was “something very close 

to a 1:1 relationship” between the number of cartridges sold 

(or not sold) by the remanufacturer and the number of 

microchips sold (or not sold) by the third-party chip 

manufacturer, the intervening step did not cut off proximate 

causation. Id. at 139. Emphasizing the “relatively unique 

circumstances,” the Court held that the remanufacturers 

were not “more immediate victim[s]” than Static Control. 

Id. at 140 (quoting Bridge, 553 U.S. at 658).

Unlike the statutes in Bridge and Lexmark, the FHA 

provides a direct link between the prohibited conduct and the 

borrower but does not support stretching proximate cause 

principles beyond the first step.

Still, Oakland urges that Miami’s broad interpretation of 

the FHA for standing purposes is a reason to embrace a 

capacious proximate-cause standard. Before the district 

court, Oakland urged that “[i]t would be illogical for 

Oakland to have standing under the FHA to pursue lost 

property taxes and increased municipal expenses, but still be 

unable to state a claim for those very same injuries under the 

FHA’s causation standard.” The district court rejected that 
CITY OF OAKLAND V. WELLS FARGO & CO. 19

argument, pointing out that statutory “[s]tanding is a 

separate issue from proximate cause.” We agree.

Indeed, it is critical to separate Miami’s holdings on two 

distinct and independent questions—statutory standing and 

proximate cause. The Court first considered whether, for 

purposes of statutory standing, Miami was an “aggrieved 

person” under the FHA. 137 S. Ct. at 1302–05. Giving that 

term a broad reading, the Court concluded that Miami 

alleged “economic injuries that arguably fall within the 

FHA’s zone of interests.” Id. at 1305. But that conclusion 

in no way controls the separate inquiry into proximate cause. 

Put simply, “[p]roximate causation is not a requirement of 

Article III standing,” and they are not coextensive. Lexmark, 

572 U.S. at 134 n.6. And injury must have “a sufficiently 

close connection to the conduct the statute prohibits”—not 

simply any harm that Congress sought to target in enacting 

the statute. Miami, 137 S. Ct. at 1305 (quoting Lexmark, 

572 U.S. at 133).

2. Administrability

Having determined that the nature of the statute does not 

warrant the extension of proximate cause beyond the first 

step, we turn to Miami’s second consideration: “what is 

administratively possible and convenient.” 137 S. Ct. 

at 1306. In articulating this inquiry, Miami cited to Holmes, 

where the Court laid out three factors relevant to 

administrability: (1) the ability to distinguish the “damages

attributable to the violation, as distinct from other, 

independent, factors”; (2) “the risk of multiple recoveries”; 

and (3) whether more direct plaintiffs could “be counted on 

to vindicate the law as private attorneys general.” Holmes, 

503 U.S. at 269–70 (citation omitted).
20 CITY OF OAKLAND V. WELLS FARGO & CO.

Before addressing the Holmes factors, we pause to 

clarify their role in the directness analysis. Holmes used 

these factors to determine whether the direct-relation 

standard applied to a particular statute, RICO. Id. We

recently used the factors in the same way when assessing 

whether the direct-relation standard applied to the AntiTerrorism Act. Fields v. Twitter, Inc., 881 F.3d 739, 746 

(9th Cir. 2018) (“The ATA presents precisely the risks with 

which the Court was concerned in Holmes . . . .”). In 

addition to using the factors to determine whether the directrelation standard applies, the Court—as well as our court—

have also used the factors in applying the direct-relation 

standard. See Anza, 547 U.S. at 456–60 (invoking the factors 

to “illustrate” an indirect injury); see also Hemi Grp., 

559 U.S. at 11–12; Bridge, 553 U.S. at 657–58; Canyon 

County v. Syngenta Seeds, Inc., 519 F.3d 969, 982–83 (9th 

Cir. 2008) (using the factors to support failure of proximate 

cause). By citing to Holmes in its description of the 

administrability component of the direct-relation standard, 

Miami appears to endorse the use of the Holmes factors 

within the application of the direct-relation standard. Miami, 

137 S. Ct. at 1306. In light of this history, we view the 

Holmes factors as instructive, though not mandatory.

Here, the Holmesfactors reinforce our view that Oakland 

has not met the directness requirement of the proximatecause standard. The first factor is the ability to distinguish 

the “damages attributable to the violation, as distinct from 

other, independent, factors.” Holmes, 503 U.S. at 269 

(citation omitted). Oakland’s theory of harm fails this test.

To begin, Oakland does not allege that an increase in 

foreclosures is “surely attributable” to the discriminatory 

lending. Lexmark, 572 U.S. at 140. Oakland’s long and 

winding causal chain begins with the claim that Wells Fargo 
CITY OF OAKLAND V. WELLS FARGO & CO. 21

initiated predatory loans to minority borrowers. Then, those 

borrowers were more likely to default on the loans. To 

trigger default, the borrower must quit making loan 

payments or violate some other term of the loan, such as 

maintaining mandatory insurance. The reason for default 

could be attributable to many independent factors, such as 

job loss, a medical hardship, a death in the family, a divorce, 

a fire or other catastrophe, Covid-19, broader economic 

trends, or any number of other unpredictable causes not 

present when the loan was made. And once default occurs, 

Oakland’s chain of events then requires the act of 

foreclosure. According to the Complaint, Wells Fargo may 

have “sold the loan or servicing rights to a third party,” 

which presumably initiated the foreclosures. Even in the 

face of default, whether to initiate foreclosure, renegotiate 

the loan, sell the loan, or even let it ride, is a decision that 

extends beyond Wells Fargo. (And even if Wells Fargo 

retained the loan, the same foreclosure decisions would 

inure.) The chain becomes even more attenuated when 

variables of property value (which could turn not only on 

foreclosure but neglect, criminal activity, changing 

demographics, and macroeconomic trends) and reduced tax 

revenues are piled on top of a cascading number of 

independent variables. Thus, Oakland’s “theory of liability 

rests not just on separate actions, but separate actions carried 

out by separate parties,” in some cases third, fourth, or fifth 

parties. Hemi Grp., 559 U.S. at 11.

The difficulties in attributing damages here are a far cry 

from the situation in Lexmark, where the Court held that the 

harm flowed so “automatically” that there were no concerns 

about attributing damages. 572 U.S. at 140. Because 

Oakland only alleges that the discriminatory loans make 

foreclosure and decreased tax revenue more likely, there is 

not a 1:1 relationship between the discriminatory loan—the 
22 CITY OF OAKLAND V. WELLS FARGO & CO.

conduct forbidden by the FHA—and decreased tax revenue. 

Oakland’s alleged injuries are more similar to those of an

unpaid “landlord” or “electric company” whose misfortune 

stems from a third party’s “inability to meet [its] financial 

obligations.” Id. at 134 (quoting Anza, 547 U.S. at 458). 

Any assessment of the actual relationship would require the 

“‘speculative . . . proceedings’ or ‘intricate, uncertain 

inquiries’” that Lexmark cautioned against. Id. at 140

(quoting Anza, 547 U.S. at 459–60); see also Anza, 547 U.S. 

at 460 (“The element of proximate causation recognized in 

Holmes is meant to prevent these types of intricate, uncertain 

inquiries from overrunning . . . litigation.”).

Oakland’s efforts to fill these gaps in the causal chain 

through regression analyses fall short. By their own terms, 

the regression analyses only “show whether the fact that a 

loan had discriminatory terms made that loan more likely to 

result in foreclosure.” They do not purport to show that 

discriminatory loans automatically result in decreased 

property values and then in decreased tax revenue. Thus, 

even accepting the results of the regression analyses as true, 

a court would be left with the unacceptable challenge of 

isolating the “damages attributable to the violation, as 

distinct from other, independent, factors.” Holmes, 503 U.S. 

at 269 (citation omitted). Leaving aside whether statistical 

modeling could be used to buttress causation in the 

appropriate case—an issue we do not decide—Oakland’s 

multiple but disconnected analyses here cannot be glued 

together to satisfy the directness requirement.

The second Holmes factor is whether allowing proximate 

cause to extend beyond the first step would require the court 

to “adopt complicated rules apportioning damages among 

plaintiffs removed at different levels of injury from the 

violative acts, to obviate the risk of multiple recoveries.” Id. 
CITY OF OAKLAND V. WELLS FARGO & CO. 23

(citations omitted). That risk is not present here because 

only Oakland (or a related administrative authority) could 

recover lost property tax revenue. But while the presence of 

this risk can indicate the need to rigorously adhere to the first 

step analysis, nothing suggests that the absence of a risk of 

duplicative recoveries warrants extending beyond the first 

step. Anza, 547 U.S. at 459.

The third Holmes factor is whether directly injured 

victims “can generally be counted on to vindicate the law as 

private attorneys general.” Holmes, 503 U.S. at 269–70. 

Here, the answer is yes. Directly harmed borrowers can sue 

individually and are incentivized to do so through the 

availability of punitive damages, attorneys’ fees, and 

equitable relief. See 42 U.S.C. § 3613(c)(1)–(2) (describing 

the relief which may be granted under the FHA). Harmed 

borrowers can also sue as a class. See, e.g., Havens Realty 

Corp. v. Coleman, 455 U.S. 363, 366–67 & n.3 (1982). 

Organizations can sue under the FHA and do so. See, e.g.,

Tex. Dep’t of Hous. & Cmty. Affs. v. Inclusive Cmtys. 

Project, 576 U.S. 519, 526 (2015); Havens, 455 U.S. at 367. 

It also bears noting that the Department of Justice (“DOJ”) 

can sue to enforce the FHA, 42 U.S.C. § 3614(a), and that 

the Department of Housing and Urban Development can 

refer certain FHA enforcement matters to the DOJ with a 

recommendation to sue, 42 U.S.C. § 3610(c). According to 

the Complaint, the DOJ in fact sued Wells Fargo, which paid 

$175 million to resolve FHA fair lending claims based on 

discrimination in residential mortgage lending. And, in a 

broader suit brought by the DOJ, Wells Fargo paid 

$1.2 billion for improper lending practices. In short, 

Oakland does not stand in the shoes of a party that cannot 

vindicate violations under the FHA, and nothing in this case 

counsels broadening the universe of actionable harms. See 

Anza, 547 U.S. at 460.
24 CITY OF OAKLAND V. WELLS FARGO & CO.

Having followed Miami to consider the nature of the 

statute and what is administratively possible and convenient, 

we conclude that Oakland’s claimed harm of reduced tax 

revenue is too remote from the cause of action and that 

nothing counsels going “beyond the first step” of proximate 

causation.

C. OAKLAND DID NOT SUFFICIENTLY PLEAD 

PROXIMATE CAUSE FOR ITS INCREASED 

MUNICIPAL EXPENSES CLAIM

The district court dismissed Oakland’s claim stemming 

from increased municipal expenditures. Although under 

28 U.S.C. § 1292(b) the court certified Oakland’s “claims 

for damages” in the plural, and without specificity as to 

which theory, in briefing the parties focused almost 

exclusively on the lost revenue claim. Nonetheless, because 

of the broad scope of certification, like the panel, we address 

this claim.

Despite Oakland’s opportunity to amend the Complaint, 

its allegations are conclusory. The increased municipal 

expenditure claim is similar to the tax revenue theory, except 

that it introduces even more independent factors to the causal 

chain. For example, the theory relies not only on the fact 

that a home will be foreclosed upon and the other variables, 

but also that individual actors will commit civil and criminal 

violations, thus necessitating more city resources to avoid 

and remedy those harms. This claim, which lacks even a 

scintilla of directness between the FHA violation and the 

purported harm, is founded on speculation based on 

conjecture. Because this claim is even further afield from 

the alleged wrongdoing than the reduced tax revenue claim, 

it fails the proximate cause test for the same reasons.
CITY OF OAKLAND V. WELLS FARGO & CO. 25

D. THE PROXIMATE-CAUSE REQUIREMENT IN MIAMI

APPLIES TO INJUNCTIVE AND DECLARATORY 

RELIEF

The district court held that Oakland did not need to 

satisfy the proximate-cause requirement for the injunctive 

and declaratory relief claims. The district court erred in this 

regard—a point that, to its credit, Oakland does not contest 

on appeal. The Court in Miami held that proximate cause is 

required under the FHA, and in doing so, did not distinguish 

between claims for damages and those for declaratory and 

injunctive relief. 137 S. Ct. at 1305–06. We read Miami to 

require a showing of proximate cause for all claims arising 

under the FHA. This conclusion is buttressed by the Court’s 

holding in Lexmark that proximate cause “is an element of 

the cause of action,” 572 U.S. at 134 n.6, that must be 

established “in every case,” id. at 135. Critically, Lexmark 

uniformly applied the proximate cause test without making 

any distinction between the damages and injunctive relief 

claims. Id. at 132–40. We reverse the district court’s 

judgment to the contrary.

CONCLUSION

We affirm the district court’s dismissal of the damages 

claim related to increased municipal expenditures and 

reverse the district court’s denial of Wells Fargo’s motion to 

dismiss the damages claim related to lost property tax

revenue and the claims for injunctive and declaratory relief.

AFFIRMED in PART, REVERSED in PART, and 

REMANDED for dismissal of the FHA claims and 

proceedings consistent with this opinion. Costs shall be 

awarded to Wells Fargo.