Opinion ID: 4421338
Heading Depth: 2
Heading Rank: 1

Heading: The City’s Evidence of Discrimination.

Text: The City’s principal evidence of discrimination was a pair of reports prepared by its expert, Ian Ayres. The first report concluded that “Wells Fargo issued loans to minority borrowers in Miami Gardens between June 13, 2012 and June 12, 2014 . . . that [were] more expensive or riskier than loans issued to nonHispanic white borrowers with similar characteristics in Miami Gardens.” Ayres reached this conclusion by conducting a matched-pair analysis using data on 153 first-lien mortgages originated by Wells Fargo between those dates. To identify “high-cost loans,” Ayres relied on the standards adopted by the Federal Financial Institutions Examination Council under the Home Mortgage 28 Case: 18-13152 Date Filed: 07/30/2019 Page: 29 of 49 Disclosure Act, 12 U.S.C. §§ 2801–11. Under the then-applicable regulation,12 C.F.R. pt. 203, app. A(I)(G)(1)(a) (2016), rescinded by Home Mortgage Disclosure, 82 Fed. Reg. 60673 (Dec. 22, 2017), a lender was required to report the “rate spread” for a loan if the spread was equal to or greater than 1.5 percentage points for a first-lien loan. As Ayres explained, the “rate spread for a loan origination is the spread between the Annual Percentage Rate (APR) and a surveybased estimate of [Annual Percentage Rates] offered on originated prime mortgage loans of a comparable amortization type, interest rate lock-in date, fixed term (loan maturity) or variable term (initial-fixed rate period), and lien status.” “The surveybased estimates are referred to as the ‘average prime offer rate’ . . . .” Using the regulatory threshold, Ayres classified a loan as high-cost if its rate spread was equal to or greater than 1.5 percentage points. By this standard, Ayres identified “seven High-Cost Loans in Wells Fargo’s data, six of which were made to AfricanAmerican borrowers and one of which was made to [a] Hispanic borrower.” No rate-spread reportable loans in the dataset were made to non-Hispanic white borrowers. From there, Ayres attempted to determine “whether a High-Cost Loan was issued to a minority borrower whereas a non-Hispanic white borrower with similar characteristics did not receive a High-Cost Loan.” Because the “rate spread already accounts for differences in the date of the loan’s rate lock, the length of the loan 29 Case: 18-13152 Date Filed: 07/30/2019 Page: 30 of 49 term, and whether the loan was a fixed-rate or [adjustable-rate mortgage] loan,” Ayres focused “only on those core underwriting differences not accounted for in the rate spread, such as occupancy status, [credit] score [as determined through the Fair Isaac Corporation’s model], the loan-to-value ratio (LTV), debt-to-income ratio (DTI), and the underwriting history of bankruptcy, foreclosures, charge-offs, collections, late payments, delinquencies, judgments, and public records on the borrower’s credit report.” After controlling for these variables, Ayres ultimately identified two highcost loans issued to minority borrowers—labeled HC2 and HC6—that had a greater rate spread than a loan issued to a non-Hispanic white, NHW8. HC2 is a loan issued to a Hispanic borrower. The credit score for this borrower is 712, the borrower’s loan-to-value ratio is 98 percent, and the borrower’s debt-to-income ratio is 47 percent. HC6 is a loan to an African-American borrower with a credit score of 741, a loan-to-value ratio of 98 percent, and a debt-to-income ratio of 43 percent. NHW8, in contrast, is a loan issued to a non-Hispanic white borrower with a credit score of 702, a loan-to-value ratio of 98 percent, and a debt-to-income ratio of 41 percent. The rate spread for loan HC2 is 2.03 percent and its Annual Percentage Rate is 5.58 percent. The rate spread of loan HC6 is 1.58 percent and its Annual Percentage Rate is 6.00 percent. But the rate spread of loan NHW8 is 1.12 percent and its Annual Percentage Rate is 5.32 percent. 30 Case: 18-13152 Date Filed: 07/30/2019 Page: 31 of 49 Based on his definition of relative loan cost in terms of the rate-spread differential, Ayres determined that loans HC2 and HC6 “were priced higher . . . than Loan NHW8 that was originated to a non-Hispanic white borrower with similar (and in some cases, riskier) characteristics.” He explained that the borrowers of loans HC2 and HC6 “had higher [credit] scores, the same occupancy status, the same [loan-to-value ratios], the same underwriting history of bankruptcy, foreclosures, charge-offs, collections, late payments, delinquencies, judgments, and public records on the borrower’s credit report, but had slightly higher debt-to-income ratios than the Loan NHW8 borrower.” Ayres concluded that the evidence was “consistent with the hypothesis that Wells Fargo issued more expensive loans to minority borrowers than non-Hispanic white borrowers with similar characteristics even after controlling for plausible and generally accepted business justifications.” In his rebuttal report, Bernard Siskin, the expert for Wells Fargo, posited two alternative explanations of the rate-spread discrepancy. First, he explained that the borrowers of loans HC2 and HC6 “chose a higher note rate in exchange for significant lender credits to be used at settlement to pay closing costs,” but the borrower on loan NHW8 “received only de minimis lender credits.” The borrower on loan HC2 opted for $8,000 in lender credits—representing 7.34 percent of the loan amount—and the borrower on HC6 opted for $1,878 in lender credits—2.12 31 Case: 18-13152 Date Filed: 07/30/2019 Page: 32 of 49 percent of the loan amount—but the borrower on loan NHW8 opted for only $479 in lender credits—equal to 0.38 percent of the loan amount. Second, Siskin argued that Ayres “fail[ed] to account for the fact that the white borrower received a loan during the two-week period when a promotional pricing discount was applied to all conventional and government purchase loans.” As a result of its origination date, NHW8 “received a 50 basis points pricing discount.” Based on data provided by an official of Wells Fargo named Jill Hunt, Siskin calculated the hypothetical rate spread and Annual Percentage Rate on each of these loans after controlling for the effects of lender credits and the promotional discount. Hunt attested that the note rate of NHW8 would have been 0.125 percent higher if the pricing discount had not been applied, which led Siskin to conclude that zeroing that discount would yield an Annual Percentage Rate of 5.4431 percent and a rate spread of 1.25 percent. Hunt also stated that if the borrowers on loans HC2 and HC6 had elected not to receive lender credits, the note rate on the loans would have been 3.25 and 4.125 percent, respectively. Based on these numbers, Siskin calculated that, “[a]ssuming the lender credits were all applied to fees included in the [Annual Percentage Rate] computation and the calculation of the [Annual Percentage Rate] did not include the fees paid with lender credit,” zeroing the lender credits elected by HC2 would result in an Annual Percentage Rate of 4.71 percent and a rate spread of 1.16. With respect to HC6, the same 32 Case: 18-13152 Date Filed: 07/30/2019 Page: 33 of 49 calculation yielded an Annual Percentage Rate of 5.86 percent and a rate spread of
So under the analysis conducted by Ayres, HC2 has an Annual Percentage Rate of 5.58 percent and a rate spread of 2.03 percent, HC6 has an Annual Percentage Rate of 6.00 percent and a rate spread of 1.58 percent, and NHW8 has an Annual Percentage Rate of 5.32 percent and a rate spread of 1.12 percent. But eliminating the promotional discount and zeroing the lender credits on loans HC2 and HC6 yields an Annual Percentage Rate of 4.71 percent and a rate spread of 1.16 for loan HC2, an Annual Percentage Rate of Annual Percentage Rate of 5.86 percent and a rate spread of 1.44 percent for loan HC6, and an Annual Percentage Rate of 5.4431 percent and a rate spread of 1.25 percent for loan NHW8. Under Siskin’s analysis, loan HC2 is slightly cheaper than NHW8 by 0.09 percent and HC6 is more expensive than NHW8 by 0.19 percent. In his supplemental report, Ayres argued that Siskin’s calculations were distorted by his apparent failure to zero the lender credits received by NHW8. As Ayres explained, Siskin did not “explicitly state whether his calculation of the hypothetical rate spread for NHW8 includes the actual lender credits or whether he assumes a hypothetical lender credit of zero.” Instead, Siskin’s report only “provide[d] the hypothetical note rate and [Annual Percentage Rate] that would have been offered on [HC2 and HC6] if no lender credit had been provided or no 33 Case: 18-13152 Date Filed: 07/30/2019 Page: 34 of 49 promotional pricing discount had been offered,” and failed to “provide[] the note rate that would have been offered for loan NHW8 if no lender credit had been provided to that borrower.” Despite this alleged insufficiency, Ayres constructed hypothetical comparisons of the rate spreads of loans HC2, HC6, and NHW8 on the assumption that “NHW8’s lender credits remain $479 in Dr. Siskin’s hypothetical rate spread calculation.” Ayres “attempted to replicate Dr. Siskin’s calculations under the incomplete hypothetical scenario in which HC6 received no lender credit (and their note rates adjusted accordingly to the note rates specified by Ms. Hunt), NHW8 continued to receive a lender credit, and neither loan received the 50 basis point promotional discount allegedly given to loan NHW8.” He applied the same procedure to develop a comparison of loans HC2 and NHW8. But Ayres departed from Siskin’s method in one key respect. Ayres faulted Siskin for failing to “control for the difference in [Federal Housing Administration] Mortgage Insurance Premiums (“MIP”) policies that were in place at the times HC2 and NHW8 were originated.” Because “HC2 was originated in November 2012, whereas NHW8 was originated in December 2013” and “the government increased the cost and duration of [mortgage insurance premiums] in April 2013 and June 2013,” Ayres projected that “adjusting for the differences in [mortgage insurance premiums] policies would serve to increase the difference between the rate spreads 34 Case: 18-13152 Date Filed: 07/30/2019 Page: 35 of 49 of HC2 and NHW8.” So Ayres attempted to control for the difference in mortgageinsurance premium costs. Ayres’s analysis yielded somewhat different results from Siskin’s. Ayres calculated the Annual Percentage Rates of HC2, HC6, and NHW8 as 5.4118 percent, 5.9560 percent, and 5.4448 percent, respectively. He deduced a rate spread of 1.86 percent for loan HC2, 1.54 percent for loan HC6, and 1.25 percent for loan NHW8. So although Ayres agreed with Siskin’s conclusion that the hypothetical rate spread of NHW8 would equal 1.25 percent, Ayres’s estimates of the rate spreads for HC2 and HC6 were higher than Siskin’s estimates of 1.16 percent and 1.44 percent. Under Ayres’s projections, HC2 is more expensive than NHW8 by 0.61 percent and HC6 is more expensive than NHW8 by 0.29 percent. The results of each expert analysis are replicated in the following table: 35 Case: 18-13152 Date Filed: 07/30/2019 Page: 36 of 49 Actual and Projected APR & Rate Spreads for Loans HC2, HC6, & NHW8 Actual Siskin Hypothetical Ayres Hypothetical Assuming $0 Assuming 2013 Lender Credits for MIP Policies, $0 HC2 & HC6 & No Lender Credits for Promotional HC2 & HC6 & No Discount Promotional Discount HC2 APR APR APR 5.5816% 4.71% 5.4118% Rate Spread Rate Spread Rate Spread
HC6 APR APR APR 5.9978% 5.86% 5.9560% Rate Spread Rate Spread Rate Spread 1.58% 1.44% 1.54% NHW8 APR APR APR 5.3181% 5.4431% 5.4448% Rate Spread Rate Spread Rate Spread 1.12% 1.25% 1.25% 36 Case: 18-13152 Date Filed: 07/30/2019 Page: 37 of 49 The City’s only other evidence of discrimination was the declaration of a former Wells Fargo loan officer named Alvaro Orozco who worked for Wells Fargo for a “very short period of time in 2010,” before the limitation period began. Orozco attested that when he worked for Wells Fargo, his manager told him “to push borrowers into certain types of loans” that were more expensive than other loans for which he believed borrowers might be eligible. Orozco also asserted that “Wells Fargo’s desire to sell government loans . . . hit African-American and Hispanic borrowers the hardest,” and he conjectured that “if African-American or Hispanic borrowers in a community received loans with higher rate spreads than similarly situated non-Hispanic Caucasian borrowers, that result would be consistent with a bank’s decision to target African-American or Hispanic borrowers for more expensive mortgage loans.” B. The City Failed to Create a Genuine Dispute of Material Fact with Respect to Its Disparate-Treatment Claim. “Disparate treatment claims require proof of discriminatory intent either through direct or circumstantial evidence.” Equal Emp’t Opportunity Comm’n v. Joe’s Stone Crab, Inc., 220 F.3d 1263, 1286 (11th Cir. 2000). Proof of intent by circumstantial evidence relies on the burden-shifting framework of McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973). See Sec’y, U.S. Dep’t of Hous. & Urban Dev. v. Blackwell, 908 F.2d 864, 870 (11th Cir. 1990) (holding that the “test developed in McDonnell Douglas” governs suits brought under the Fair Housing 37 Case: 18-13152 Date Filed: 07/30/2019 Page: 38 of 49 Act). Under this framework, “the plaintiff bears the initial burden of establishing a prima facie case of discrimination.” Lewis v. City of Union City, 918 F.3d 1213, 1217 (11th Cir. 2019) (en banc). “If the plaintiff succeeds in making out a prima facie case, the burden shifts to the defendant to articulate a legitimate, nondiscriminatory reason for its actions.” Id. at 1221. “[S]hould the defendant carry its burden, the plaintiff must then demonstrate that the defendant’s proffered reason was merely a pretext for discrimination.” Id. This burden “merges with the ultimate burden of persuading the court that she has been the victim of intentional discrimination.” Id. (alterations omitted) (quoting Tex. Dep’t of Cmty. Affairs v. Burdine, 450 U.S. 248, 256 (1981)). The “elements of a prima facie case are flexible and should be tailored . . . to differing factual circumstances.” Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1123 (11th Cir. 1993) (citation and internal quotation marks omitted). In this appeal, a prima facie case of intentional discrimination required proof that (1) the borrower was a member of a protected class, (2) the borrower applied for and was qualified to receive loans from the defendant, and (3) the loan was offered on less favorable terms than a loan offered to a similarly situated person who was not a member of the borrower’s class. Cf. McDonnell Douglas, 411 U.S. at 802. A plaintiff and a comparator are “similarly situated” under McDonnell Douglas if they are 38 Case: 18-13152 Date Filed: 07/30/2019 Page: 39 of 49 “similarly situated in all material respects.” Lewis, 918 F.3d at 1226 (internal quotation marks omitted). The district court ruled that the City failed to establish a prima facie case because the borrowers of HC2 and HC6 are not similarly situated to the borrower of NHW8. It concluded that the loans were “‘apples and oranges’ that cannot be compared” because “the borrowers elected different structures to either finance closing costs over time or pay them at the outset” and NHW8 received a promotional discount. The district court refused “to consider Dr. Ayres’s efforts to extrapolate what the [Annual Percentage Rate] would be on HC2 and HC6 without the lender credits” because the credits were “simply a term of the loan that [the] Court cannot ignore.” In the alternative, the district court ruled that even if the City could establish a prima facie case, it failed to establish pretext because Ayres’s “method of comparison also reveal[ed] situations in which Wells Fargo originated loans to minority borrowers that were less expensive than loans issued to white borrowers,” undermining any inference that the difference in loan cost posited by Ayres was caused by an intent to discriminate. The City argues that the district court erred by refusing to credit Ayres’s calculation of the Annual Percentage Rate and rate spread for each loan after controlling for lender credits and the promotional discount because it is possible to prove a prima facie case of discrimination in this context merely by establishing 39 Case: 18-13152 Date Filed: 07/30/2019 Page: 40 of 49 that “one more expensive or riskier loan [was] given to a minority borrower.” Interpreted charitably, the City’s argument is that the discount and lender credits had an ascertainable impact on the bottom-line cost of the loans in question, so it was possible, using Ayres’s methodology, to control for the effect of those differences on the rate spread of each loan and determine whether the loans issued to minority borrowers were more costly than NHW8. In the City’s view, the continued existence of a cost disparity between loans HC2 and HC6 and loan NHW8 after controlling for lender credits and the discount supports a reasonable inference that the most likely explanation of the residual cost difference is the race or ethnicity of the borrowers, which suffices to establish a prima facie case. See Furnco Const. Corp. v. Waters, 438 U.S. 567, 577 (1978) (“A prima facie case under McDonnell Douglas” must establish that the challenged acts, “if otherwise unexplained, are more likely than not based on the consideration of impermissible factors.”). This Circuit has never held that a plaintiff can establish that individuals are similarly situated by reductively analyzing apparent differences between them in terms of a common metric of comparison, but even if we assume that a plaintiff can do so, we should nevertheless conclude that the City failed to establish an inference of discriminatory intent. Wells Fargo volunteered “legitimate, nondiscriminatory reason[s] for its actions,” Lewis, 918 F.3d at 1221, namely (1) 40 Case: 18-13152 Date Filed: 07/30/2019 Page: 41 of 49 the difference in lender credits, and (2) the availability of the promotional discount, so “the inquiry proceeds to a new level of specificity” at which “the plaintiff must show the . . . proffered reason[s] to be a pretext for unlawful discrimination.” Smith v. Lockheed-Martin Corp., 644 F.3d 1321, 1326 (11th Cir. 2011) (citation and internal quotation marks omitted). To establish pretext, the plaintiff must produce evidence sufficient to support a reasonable inference “that a discriminatory reason more likely motivated” the defendant or that the defendant’s “proffered explanation is unworthy of credence.” Burdine, 450 U.S. at 256. But under either avenue of proof, the ultimate question is “whether the evidence . . . yields the reasonable inference that the [defendant] engaged in the alleged discrimination.” Smith, 644 F.3d at 1326. The City failed to establish a reasonable inference that a discriminatory motive accounted for the cost differential between loans HC2 and HC6 and loan NHW8. Even if the lender-credits and promotional-discount explanations failed to account for the totality of the cost difference between HC2 and HC6 on the one hand and NHW8 on the other, it is undisputed that Wells Fargo also issued two loans to minority borrowers similarly situated to the borrower on loan NHW8 that were less expensive than NHW8. These loans, ML1 and ML2, were Federal Housing Administration purchase loans issued to minority borrowers who had, respectively, credit scores of 671 and 693, loan-to-value ratios of 98 percent, and 41 Case: 18-13152 Date Filed: 07/30/2019 Page: 42 of 49 debt-to-income ratios of 46.3 percent and 41.1 percent. The borrower of NHW8 had a credit score of 702, a loan-to-value ratio of 98 percent, and a debt-to-income ratio of 41 percent. Although the underwriting characteristics of the borrower of NHW8 are similar to those of the borrowers of ML1 and ML2 under Ayres’s criteria, the rate spreads of ML1 and ML2 are 0.74 percent and 0.94 percent while the rate spread of NHW8 is 1.12 percent. As the district court correctly ruled, this evidence precludes any inference “that a discriminatory reason more likely motivated” Wells Fargo. Burdine, 450 U.S. at 256. Apart from the declaration of Orozco—which, as discussed below, provides no support for the City’s position—the City’s case for disparate treatment is based entirely on the theory that one can rationally infer that intentional discrimination explains the residual cost discrepancy between loans HC2 and HC6 and loan NHW8. But this theory of intentional discrimination cannot account for the existence of nonminority borrowers who received more costly loans than similarly situated minorities. If Wells Fargo priced membership in a minority race or ethnicity into its loans, one would expect that minority borrowers would be systematically charged more than non-Hispanic white borrowers. But the evidence does not bear out that prediction. Indeed, the City’s theory of intentional discrimination is less accurate than a competing hypothesis of random variation in pricing because that explanation would at least potentially account for the 42 Case: 18-13152 Date Filed: 07/30/2019 Page: 43 of 49 existence of loans both more and less favorable to minorities. The City’s theory renders the existence of the former class of loans inexplicable. The City does not attempt to establish pretext by arguing that Wells Fargo’s “proffered explanation[s] [are] unworthy of credence,” id., and with good reason. True, Ayres’s hypothetical calculations of the rate spreads of HC2, HC6, and NHW8, may allow a reasonable inference that the lender credits and discount fail to explain the entirety of the cost discrepancy, as Wells Fargo maintained. But although “a plaintiff’s prima facie case, combined with sufficient evidence to find that the [defendant’s] asserted justification is false, may permit the trier of fact to conclude that the [defendant] unlawfully discriminated,” that proof will not “always be adequate to sustain a jury’s finding of liability.” Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 148 (2000). The issue on summary judgment is whether a genuine dispute of material fact exists, and there are “instances where, although the plaintiff has established a prima facie case and set forth sufficient evidence to reject the defendant’s explanation, no rational factfinder could conclude that the action was discriminatory.” Id. As I have explained, this appeal is one of those instances because of the “uncontroverted independent evidence” that Wells Fargo’s lending behavior produced unexplained cost discrepancies favorable to minority borrowers as well as one favorable to a nonminority borrower. Id. 43 Case: 18-13152 Date Filed: 07/30/2019 Page: 44 of 49 The City also argues that the district court should have considered Orozco’s affidavit and the testimony of a Wells Fargo executive named Mary Woodward, but this evidence does nothing to improve the City’s position. Orozco attested that his manager told him “to push borrowers into certain types of loans,” such as Federal Housing Administration loans, instead of other loans that might be cheaper. He also opined that “if African-American or Hispanic borrowers in a community received loans with higher rate spreads than similarly situated nonHispanic Caucasian borrowers, that result would be consistent with a bank’s decision to target African-American or Hispanic borrowers for more expensive mortgage loans.” But Orozco did not provide any reason to believe that Wells Fargo “targeted” African-American or Hispanic borrowers for more expensive loans any more than they targeted members of other racial or ethnic groups. Indeed, he admitted that he was instructed to push borrowers into more expensive loans not because of their race, but “because these loans made more money for the bank and were easier to sell on the secondary market.” So his affidavit provides no basis for an inference of intent. Woodward testified only that she was unaware of any analysis prepared by Wells Fargo’s Internal Audit Department or any other department of the bank concerning allegations of violations of fair-lending laws and did not know of any reports, memoranda, or other written documents regarding the results of internal 44 Case: 18-13152 Date Filed: 07/30/2019 Page: 45 of 49 investigations into compliance with such laws. The ignorance of a single Wells Fargo executive about whether the bank had conducted any internal investigation into its compliance with fair-lending laws does not support an inference of discriminatory intent at all, so this testimony adds nothing to the City’s case. At bottom, even if one were to consider all of its evidence, the City failed to establish a genuine issue of material fact. C. The City Abandoned Any Challenge to the District Court’s Ruling on its Disparate-Impact Claim. Disparate-impact liability under the Fair Housing Act requires proof that a policy or practice of the defendant has “a ‘disproportionately adverse effect on minorities,’” Tex. Dep’t of Hous. & Cmty. Affairs v. Inclusive Cmtys. Project, 135 S. Ct. 2507, 2513 (2015) (quoting Ricci v. DeStefano, 557 U.S. 557, 577 (2009)), for which a prima facie case has three distinct elements. First, a prima facie case requires “the identification of a specific, facially-neutral . . . practice” or policy. Joe’s Stone Crab, 220 F.3d at 1268; see also Inclusive Cmtys., 135 S. Ct. at 2523 (holding that “a disparate-impact claim” under the Fair Housing Act “must fail if the plaintiff cannot point to a . . . policy or policies”). Second, the plaintiff must establish the existence of a “significant statistical disparity” between the effects of the challenged policy or practice on minorities and non-minorities. Joe’s Stone Crab, 220 F.3d at 1274. Third, in the light of the “serious constitutional questions that might arise . . . if such liability were imposed based solely on a showing of 45 Case: 18-13152 Date Filed: 07/30/2019 Page: 46 of 49 statistical disparity,” a plaintiff proceeding on a disparate-impact theory must also establish a “robust causality” connecting the challenged policy and the statistical disparity. Inclusive Cmtys., 135 S. Ct. at 2512. “A plaintiff who fails to . . . produce statistical evidence demonstrating a causal connection cannot make out a prima facie case of disparate impact.” Id. at 2523. The district court ruled that the City failed to produce sufficient evidence with respect to the statistical-disparity and causation elements of its claim. The district court interpreted the City’s claim as a challenge to (1) Wells Fargo’s Product Validation Process, which “examines borrowers to determine if they are eligible for less expensive loans,” and (2) Wells Fargo’s “practice of allowing lender credits on certain [Federal Housing Authority] loans,” which purportedly was “a vehicle for differential pricing.” The City’s principal evidence of disproportionate effect was Ayres’s reports, which identified two loans issued to minorities that allegedly were more expensive than loans issued to a similarly situated white borrower. The district court rejected the City’s contention that these loans supported an inference of a disproportionate adverse impact on minority borrowers because “[t]wo loans, even assuming they were more expensive, is insufficient record evidence to show the policies produced statistically-imbalanced lending patterns.” The district court also ruled that the City failed to produce any 46 Case: 18-13152 Date Filed: 07/30/2019 Page: 47 of 49 “evidence of the robust causation needed to show the polic[ies] caused the statistical disparity.” The City argues that it was error for the district court to require evidence of a statistical disparity because its burden was only to “identify at least one loan in the [limitation] period that exemplifies the discriminatory practice pleaded by the City,” but the City does not so much as attempt to challenge the district court’s alternative ruling on the causality element. So the City abandoned any challenge to the district court’s ruling on its disparate-impact claim. As we have explained, “[w]hen an appellant fails to challenge properly on appeal one of the grounds on which the district court based its judgment, he is deemed to have abandoned any challenge of that ground, and it follows that the judgment is due to be affirmed.” Sapuppo v. Allstate Floridian Ins. Co., 739 F.3d 678, 680 (11th Cir. 2014). The district court was also right to conclude that the City produced no evidence of causation. Even if one grants the City’s tendentious assumption that the two loans identified by Ayres suffice to establish “a disproportionately adverse effect on minorities,” Inclusive Cmtys., 135 S. Ct. at 2513 (citation and internal quotation marks omitted), the City never pointed to any evidence that even suggests that Wells Fargo’s policies caused this disparity in loan cost. For all we can infer from the evidence, the putative divergence in cost is attributable to ad hoc decisions, rounding errors, small differences between the borrowers, or factors not 47 Case: 18-13152 Date Filed: 07/30/2019 Page: 48 of 49 accounted for in Ayres’s analysis. So even if the City had not abandoned its disparate-impact claim, its failure to come forward with anything more than groundless speculation that a Wells Fargo policy must account for the cost discrepancy is fatal to its claim. Even if one ignores these glaring problems with the City’s position and considers the merits of its challenge to the district court’s ruling on the statisticaldisparity element, the City comes up short. The City faults the district court for concluding that the two loans identified by Ayres failed to establish a violation on a disparate-impact theory. The City argues that under the continuing-violation doctrine its only “task [was] to identify at least one loan in the [limitation] period that exemplifies the discriminatory practice pleaded by the City.” But to invoke the continuing-violation doctrine, a plaintiff must establish that a violation of the Act occurred in the limitation period. See Hipp v. Liberty Nat’l Life Ins. Co., 252 F.3d 1208, 1221 (11th Cir. 2001). And under a disparate-impact theory of liability, proof of a violation requires the plaintiff to establish that the challenged policy produced a “significant statistical disparity,” Joe’s Stone Crab, 220 F.3d at 1274; see also Ricci, 557 U.S. at 587 (“[A] prima facie case of disparate-impact liability” is “essentially, a threshold showing of a significant statistical disparity.”). The City failed to present any evidence of a statistical correlation between the race of a borrower and the cost of the loan Wells Fargo would issue to him 48 Case: 18-13152 Date Filed: 07/30/2019 Page: 49 of 49 under its existing policies. Ayres never conducted a statistical analysis of whether Wells Fargo’s lending practices disproportionately impacted minorities. Indeed, he stated that he would forgo any attempt to analyze the “disparate impact of Wells Fargo’s mortgage lending,” but would “prepare a detailed analysis” if the case survived the summary-judgment stage. So even if the City had not abandoned its disparate-impact claim or failed to produce any evidence of causation, the City still would have failed to create a genuine issue of material fact with respect to this claim. 49