                 FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

PACIFIC SHORES PROPERTIES, LLC, a         No. 11-55460
California limited liability company;
ALICE CONNER; SEAN WISEMAN;                   D.C. No.
TERRI BRIDGEMAN,                          8:08-cv-00457-
                 Plaintiffs-Appellants,      JVS-RNB

ANDREW BLAIR,
                             Plaintiff,

                  v.

CITY OF NEWPORT BEACH, a
California municipal corporation,
                Defendant-Appellee.




NEWPORT COAST RECOVERY LLC, a             No. 11-55461
California Limited Liability
Company; YELLOWSTONE WOMEN’S                  D.C. No.
FIRST STEP HOUSE, INC.,                   8:09-cv-00701-
                Plaintiffs-Appellants,       JVS-RNB

                  v.
                                             ORDER
CITY OF NEWPORT BEACH, a
California municipal corporation,
                Defendant-Appellee.
2    PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH

                       Filed March 4, 2014

Before: Alex Kozinski, Chief Judge, and Stephen Reinhardt
          and Sidney R. Thomas, Circuit Judges.

                             Order;
                 Dissent by Judge O’Scannlain


                           SUMMARY*


                    Housing Discrimination

    The panel filed an order rejecting a sua sponte en banc
call.

    Judge O’Scannlain, joined by Judges Tallman, Callahan,
Bea, and Ikuta, dissented from the denial of rehearing en
banc. He wrote that the panel’s opinion invented “an entirely
unprecedented theory of actionable government
discrimination: sinister intent in the enactment of facially
neutral legislation can generate civil liability without
evidence of discriminatory effect.”




  *
    This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
     PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH         3

                          ORDER

    A sua sponte call for a vote on rehearing this case en banc
was made by an active judge of this court. The call failed to
receive a majority of the votes of the nonrecused active
judges. Fed. R.App. P. 35. The sua sponte en banc call is
rejected.

   Judge O’Scannlain’s dissent from denial of rehearing en
banc is filed concurrently with this Order.



O’SCANNLAIN, Circuit Judge, joined by TALLMAN,
CALLAHAN, BEA, and IKUTA, Circuit Judges, dissenting
from the denial of rehearing en banc:

    The panel’s opinion in these consolidated cases invents an
entirely unprecedented theory of actionable government
discrimination: sinister intent in the enactment of facially
neutral legislation can generate civil liability without
evidence of discriminatory effect.

    Such unwarranted expansion of “disparate treatment”
doctrine, moreover, recognizes no principled limit. A single
member of any protected class will now be able to challenge
a facially neutral—and evenly applied—municipal ordinance
without having suffered any actual discrimination.

    Our Court, alone among the nation’s appellate tribunals,
has embarked on an uncharted and highly dubious course. I
respectfully dissent from our refusal to rehear these cases en
banc.
4       PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH

                                        I

     In these cases, residents and operators of “group homes,”
i.e., communal living arrangements among recovering
alcoholics and drug addicts, challenge a municipal ordinance
for discriminating against them on the basis of disability.

    On January 22, 2008, the city of Newport Beach,
California, enacted Ordinance No. 2008-05 to address
perceived concerns caused by transients living in residential
neighborhoods. The Ordinance redefined certain residential
categories that are permitted to occupy various zones of the
city. Such categories, as relevant here, included the “single
housekeeping unit,”1 the “group residential” unit2, and



        1
        The Ordinance defines the “single housekeeping unit” as
“functional[ly] equivalent [to] a traditional family”:

            [The] members [of the single housekeeping unit] are an
            interactive group of persons jointly occupying a single
            dwelling unit, including the joint use of and
            responsibility for common areas, and sharing household
            activities and responsibilities such as meals, chores,
            household maintenance, and expenses, and where, if the
            unit is rented, all adult residents have chosen to jointly
            occupy the entire premises of the dwelling unit, under
            a single written lease with joint use and responsibility
            for the premises, and the makeup of the household
            occupying the unit is determined by the residents of the
            unit rather than the landlord or property manager.

Newport Beach, Cal., Ordinance No. 2008-05, § 1.
    2
     The “group residential” category encompasses other joint living
arrangements that do not qualify as single housekeeping units, such as
“boarding or rooming houses, dormitories, fraternities, sororities, and
       PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH                    5

“residential care facilities.”3 Although single housekeeping
units are allowed in any residential district, group residential
units are prohibited; residential care facilities, on the other
hand, whether pre-existing the Ordinance or opened
thereafter, may occupy any residential zone after obtaining a
use permit or seeking a reasonable accommodation. See
Newport Beach, Cal., Ordinance No. 2008-05, § 2. Premises
occupied by recovering addicts may fail to qualify as a
“single housekeeping unit” or a “residential care facility,” on
a case-by-case basis, but the definitions do not exclude
disabled individuals as a matter of course.

    Plaintiffs—occupants and owners of group homes that
qualify as residential care facilities—charged that the
Ordinance discriminates against them on the basis of
disability in violation of the Fair Housing Act (FHA),
42 U.S.C. § 3601 et seq., the Americans with Disabilities Act
(ADA), 42 U.S.C. § 12101 et seq., the California Fair
Employment and Housing Act, Cal. Gov’t Code § 12900 et
seq., and the Fourteenth Amendment. Before the district
court, they advanced both disparate treatment and disparate
impact as theories of liability. The city successfully sought
summary judgment on the disparate treatment claims. In its
disposition, the district court concluded that the plaintiffs
“failed to identify any evidence showing that [disabled
individuals] were treated differently than similarly situated
non-disabled individuals” under the “facially neutral”



private residential clubs.” Newport Beach, Cal., Ordinance No. 2008-05,
§ 2.
   3
     Specially exempted from the group residential classification are
“residential care facilities,” defined as sites where seven or more disabled
individuals reside. See Newport Beach, Cal., Ordinance No. 2008-05, § 2.
6     PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH

Ordinance. The district court’s order did not disturb the
complainants’ disparate impact claims; nevertheless,
plaintiffs voluntarily dismissed those claims so that they
could pursue this appeal.

    The panel reversed the district court, asserting that
evidence of discriminatory legislative intent in adopting the
Ordinance—without even an allegation of discriminatory
effect—is sufficient to permit a claim of disparate treatment
to survive summary judgment. Noting that the plaintiffs had
to expend time and resources to comply with the Ordinance,
the panel determined that they had suffered an injury under
the anti-discrimination laws.4

                                     II

    According to the panel, the district court, by dismissing
as “irrelevant” the “large amount of evidence” about the
Ordinance’s “allegedly discriminatory intent,” ignored the
proper analytical framework. Slip op. at 31. I respectfully
suggest, on the contrary, that it is the panel—not the district
court—that ignores well-settled principles. Neither our
decisions, nor the Supreme Court’s, have ever allowed
challenges to facially neutral laws by simply alleging
discriminatory legislative intent.




 4
   The panel only discusses in detail the plaintiffs’ claims under the FHA
and the ADA; this dissent accordingly limits itself to those claims as well.
     PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH          7

                               A

                               1

    Title VII of the Civil Rights Act of 1964, 42 U.S.C.
§ 2000e et seq., governs the analytical framework under the
FHA and the ADA. See Budnick v. Town of Carefree,
518 F.3d 1109, 1113–14 (9th Cir. 2008); Hernandez v.
Hughes Missile Sys. Co., 362 F.3d 564, 568 (9th Cir. 2004).
Plaintiffs raising claims of discrimination under these statutes
can proceed under either of two distinct theories, styled
“disparate treatment” and “disparate impact.” To allege
discrimination under a theory of disparate treatment, the
plaintiff generally must demonstrate that the defendant
treated him differently from similarly situated persons
because of his membership in a protected group. The
paradigmatic instance of disparate treatment, accordingly, is
the selective enforcement of an otherwise fairly framed law
or policy. See, e.g., McDonnell Douglas Corp. v. Green,
411 U.S. 792, 802 (1973). Our precedents have also
recognized an “alternative approach” to proving disparate
treatment in certain scenarios. See McGinest v. GTE Service
Corp., 360 F.3d 1103 (9th Cir. 2004). When a worker faces
an adverse employment action, or a municipal board denies
a permit or zoning variance to an applicant, the aggrieved
party may provide direct or circumstantial evidence that
impermissible discriminatory intent tainted the decision-
making process. See, e.g., Budnick, 518 F.3d at 1114 (“When
disparate treatment is claimed as a result of the denial of a
special use permit . . . . a plaintiff may also simply produce
direct or circumstantial evidence demonstrating that a
discriminatory reason more likely than not motivated the
challenged decision.” (internal quotation marks omitted)). In
such situation, the plaintiffs would not need to show selective
8    PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH

enforcement of an employment policy or land-use law to
survive summary judgment: this adverse result, motivated by
a discriminatory reason, is a sufficient showing of
discrimination.

    Without exception, the case law of this Circuit has only
permitted plaintiffs to invoke such “alternative approach” to
challenge the adverse result of an individualized decision-
making process allegedly subverted by a discriminatory
motive. For example, an employee unjustly terminated or
improperly demoted may plausibly allege disparate treatment,
even if no one else similarly situated achieved a different
outcome, if a discriminatory intent lay behind the decision.
McGinest, 360 F.3d at 1122; see also Costa v. Desert Palace,
Inc., 299 F.3d 838, 855 (9th Cir. 2002) (en banc); Lowe v.
City of Monrovia, 775 F.2d 998, 1006–07 (9th Cir. 1985).
The situation in FHA and ADA claims is analogous: a
developer may assert disparate treatment after a zoning board
denies him a permit, or a renter after a landlord suspiciously
rejects his application. See Budnick, 518 F.3d at 1114. The
“alternative approach” to disparate treatment, just like the
McDonnell Douglas framework, protects against
discriminatory application even of an otherwise facially
neutral law or policy.

    But here, the panel authorizes—as a claim of disparate
treatment sufficient to survive summary judgment—a
challenge simply to a facially neutral law itself and not to any
particular suspicious or selective instance of enforcement.
This is unprecedented. Discrimination law indeed provides
a doctrinal basis for dealing with allegations that an
apparently neutral statute nevertheless illegally discriminates
against a protected class—but such allegations sound in
disparate impact, not disparate treatment. See, e.g., Budnick,
     PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH          9

518 F.3d at 1118–19 (summarizing the elements of a
disparate impact claim).       The conceptual innovation
introduced by the panel here threatens to collapse the
doctrinal distinction between disparate treatment and
disparate impact as heretofore distinct bases for liability
under the anti-discrimination statutes.

                               2

    The panel plainly overreads our precedents to conclude
that all a plaintiff must allege to survive summary judgment
is that a discriminatory legislative intent lay behind the
challenged law. Slip op. at 29. In support, the panel cites
four of our decisions—none of which is on point. All
concern either an individual adverse employment decision,
see McGinest, 360 F.3d 1103; Costa, 299 F.3d 838; Lowe,
775 F.2d 998, or a rejected application for a permit, see
Budnick, 518 F.3d 1109.

    The panel goes so far as to assert that once plaintiffs have
given evidence of illicit municipal legislative motive, the
inquiry turns to the “‘sensitive’ multi-factor inquiry”
catalogued in Village of Arlington Heights v. Metropolitan
Housing Development Corp., 429 U.S. 252 (1977). Slip op.
at 29. But this puts the cart before the horse. In Arlington
Heights and all the other cited cases, the precise issue was
whether defendants acted with the proscribed discriminatory
intent. In each case, the plaintiffs had suffered allegedly
discriminatory treatment—for example, the denial of a permit
or the selective enforcement of zoning laws—but did not
attack, as plaintiffs here do, the very enactment of a facially
neutral ordinance. See 429 U.S. at 264–65; Gallagher v.
Magner, 619 F.3d 823, 831–33 (8th Cir. 2010) (uneven
enforcement of housing code); Hallmark Developers, Inc. v.
10 PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH

Fulton Cnty., 466 F.3d 1276, 1283–86 (11th Cir. 2006)
(denial of zoning application); Tsombanidis v. West Haven
Fire Dept., 352 F.3d 565, 579–80 (2d Cir. 2003) (denial of re-
zoning request). Plaintiffs here press a disparate treatment
claim, having suffered no such adverse action.

    The panel arraigns the district court for the “suggestion
that a plaintiff can establish a prima facie case of intentional
discrimination only by using the McDonnell Douglas burden
shifting construct,” which, it claims, is the only “way of
interpreting the district court’s position.” Slip op. at 31. But
this “interpret[ation]” ignores the district court’s actual
reasoning. Citing McGinest, the district court accurately
explained that the “alternative approach” has never permitted
“a disparate treatment claim [to] proceed . . . where there has
been no showing of actual disparate treatment.” The district
judge articulated the precise reason for rejecting the
“alternative approach” in this case:

       Plaintiffs have not identified, and the Court
       has not found, any case in which a facially
       neutral statute that was passed with an intent
       to discriminate against a protected class was
       found to be invalid without an accompanying
       showing of either actual disparate treatment of
       others similarly situated or disparate impact
       on a protected class.

Indeed, the panel does not even attempt to refute this
conclusion; rather, the panel ignores it, mischaracterizes the
district court’s reasoning, and moves on.

   Our cases and the decisions of the Supreme Court already
permit claims of discrimination even against facially neutral
     PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH          11

statutes without any evidence of selective enforcement. But
these suits must satisfy the elements of a disparate impact
claim. The panel unjustifiably disturbs these settled
principles of discrimination law.

                               B

    The panel’s characterization of the plaintiffs’ injury
underscores that its novel theory does not require any actual
discrimination at all. The city had defended against
plaintiffs’ disparate treatment claims for failing to “show that
they suffered any adverse effects as a result of its actions,
even if those actions were motivated by discriminatory intent,
because, on appeal, the Group Homes have not challenged the
City’s denial of their individual permit applications.” Slip op.
at 42. But, the panel proclaims, the very “imposition of the
Ordinance itself . . . triggered their injuries,” principally the
time and expenses incurred in complying with the new
regulation. Id. Our cases have never held that mere
compliance with municipal administrative procedures is a
sufficient injury to claim disparate treatment. This is
particularly pertinent where, as here, a plaintiff has submitted
to such procedures and successfully applied for a permit or
zoning variance.

    For this unprecedented conclusion that a permitting
scheme imposed by a facially neutral ordinance could inflict
a discrimination injury, the panel invokes Flores v. Pierce,
617 F.2d 1386 (9th Cir. 1980). In that case, the plaintiffs had
applied for a liquor license but city officials had lodged a
complaint with the relevant state regulatory board, resulting
in a denial of their application. The “rigors of the
governmental or administrative process” were not imposed on
the Floreses by a facially neutral law applied evenhandedly
12 PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH

but rather by the city officials’ “selective protests.” Id. at
1390–91. Such “selective protests,” culminating in an actual
harm such as “the denial of [an] application,” are precisely
the sort of injury against which disparate treatment liability
protects: selective enforcement. Id. at 1392. Flores lends no
support to plaintiffs who challenge neutral laws without
discriminatory treatment.

    And it is no wonder that our precedents have never
approved a claim of disparate treatment against a facially
neutral law in the absence of selective enforcement.
“Disparate treatment” suggests, by its conventional meaning
as well as dictionary definition, to single out unfavorably and
unjustifiably some individual on the basis of a protected trait.
The district judge invoked Schwarz v. City of Treasure
Island, for this obvious but apparently overlooked truth: “As
its name suggests, a disparate treatment claim requires a
plaintiff to show that he has actually been treated differently
than similarly situated non-handicapped people.”5 544 F.3d
1201, 1216 (11th Cir. 2008).

    Indeed other sister Circuits also have rejected challenges
to facially neutral laws based on discriminatory motives of
municipal actors. See Oxford House-C v. City of St. Louis,


   5
      Although Schwarz suggests that the “analysis might have been
different if . . . the City enacted the [challenged] rule in order to
discriminate against people with disabilities,” that obiter dicta does not
validate disparate treatment claims without a discriminatory act. A
contrary conclusion, which the panel finds consistent with Schwarz, baldly
countermands—as the district court in these present cases indicated—its
holding. The fact that a single district judge violated Schwarz by
permitting, in the unreviewed decision Caron Found. of Fla., Inc. v. City
of Delray Beach, 879 F. Supp. 2d 1353 (S.D. Fla. 2012), a disparate
treatment claim in the absence of discriminatory act is of no moment.
     PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH         13

77 F.3d 249, 252 (8th Cir. 1996) (holding that evidence of
administrators’ biased statements when enforcing a facially
non-discriminatory law did not suffice for disparate
treatment); see also Cinnamon Hills Youth Crisis Ctr., Inc. v.
St. George City, 685 F.3d 917, 921 (10th Cir. 2012)
(concluding that “general statements suggesting bias” are not
enough to allege disparate treatment even in the context of an
application for a zoning variance). The panel vainly attempts
to distinguish Schwarz and Oxford House-C by noting that
both involved “pre-existing, facially neutral zoning laws”
enacted without a “discriminatory purpose.” Slip op. at 36.
That feature, although present in those cases and absent in the
current appeal, is irrelevant. The actual principle of those
cases applies perfectly to the situation at hand: without any
differential treatment there can be no discrimination—
certainly none that the law recognizes, forbids, and punishes.

    But the panel’s invention signals an abrupt departure from
what these cases categorize as an injury caused by
discrimination. Plaintiffs need not plead and prove that only
they outlaid funds and manpower, or that the municipal
government prosecuted them especially. According to the
panel, a plaintiff would present a triable case with only a bare
accusation that a councilman or a community activist uttered
an epithet in the legislative prelude to a challenged ordinance.
As long as the enactment importunes a party in some even
menial way, he will have suffered a sufficient injury to allege
discrimination—and to survive summary judgment to boot.

                              III

    What appears to bottom the panel’s analysis is a policy
judgment that rejecting the plaintiffs’ disparate treatment
claims “would lead to unacceptable results.” Slip op. at 31.
14 PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH

Depicting in lurid hues the “grotesque scenario,” where
conspiratorial city councils enact a “facially neutral law and
policy” and enforce the measure “even against similarly-
situated individuals who are not members of the disfavored
group,” the panel asserts that such “overdiscrimination” is
simply “not the law.” Id. at 31–32. These constitutional
concerns are overwrought. In the vast majority of cases
where a city evenhandedly enforces a neutral ordinance, there
is no discrimination. In the exceptional cases when a local
legislative body seeks to punish a protected class and,
anticipating discrimination suits, extends ill consequences
beyond the targeted demographic, suffering plaintiffs have
protection. That’s where disparate impact comes in: laws
that affect both protected and unprotected classes but yet
disproportionately injure only the former. That these
plaintiffs have abandoned their disparate impact claims does
not insulate this or any other city’s facially neutral ordinances
from future meritorious claims of discrimination.

                               IV

    Finally, the panel’s opinion is an ominous portent for
future judicial interference with the political branches.
Plaintiffs, who include not only disabled individuals
themselves but also owners of businesses that operate group
homes, quite understandably opposed the piece of
inconvenient municipal legislation at issue here. But on
appeal, they argue neither that the ordinance facially
discriminates against them nor that Newport Beach
selectively enforced it against them. Rather they merely
claim that the municipal government, along with any number
of residents, activists, and community groups, had nefarious
intent in enacting the ordinance in the first place. Because
this local regulation puts up some red tape—few, if any,
     PAC. SHORES PROPERTIES V. CITY OF NEWPORT BEACH        15

regulations are costless—the panel astoundingly concludes
that the plaintiffs made a sufficient showing of a
discrimination injury to survive summary judgment.

    Yet the panel does not suggest any limiting principle for
its searching inquiry into municipal legislative motives.
What sorts of pre- or post-enactment statements may a court
examine for this impermissible intent—utterances during
committee meetings, quotations from newspaper articles,
political stump speeches?          Who among the various
government actors must express this intent—only those
officers with a vote on the city council, or any municipal
employee involved in the drafting? What may or may not
private citizens say in support of local initiatives, and when
may they say it, lest any of their ill motives taint the
legislative process? Such questions hardly seem appropriate
for principled and consistent judicial inquiry. But the panel,
satisfied that an apparent injustice is now remedied, offers no
more guidance than its policy preference. This cannot be the
state of coherent and workable anti-discrimination law today.

                              V

    The panel’s decision in these cases canonizes a novel
theory of liability under the anti-discrimination statutes:
plaintiffs may now challenge facially neutral and fairly
enforced municipal ordinances on the mere accusation that
improper intent had tainted the legislative process without
any showing of actual discriminatory treatment. To quote the
panel, this absurd result “is not the law.”

    I respectfully dissent from the court’s regrettable failure
to grant en banc rehearing.
