In the case of Gladstone, Realtors v. Village of Bellwood (1978), the U.S Supreme Court ruled that white homeowners in a racially integrated neighborhood had standing to sue real estate brokers for racial steering under the Fair Housing Act. The plaintiffs alleged that Gladstone Realtors was showing black homebuyers properties only in certain areas, thereby promoting segregation and causing property values to decline. The court held that anyone who alleges specific injury from illegal housing practices can seek redress under this law, even if they are not directly discriminated against themselves. This decision expanded legal protections against discriminatory housing practices by recognizing "third-party" claims—those brought by individuals indirectly harmed by such discrimination.

In the dissenting opinion for Gladstone, Realtors v. Village of Bellwood, Justice Rehnquist disagreed with the majority's interpretation of standing under the Fair Housing Act. He argued that a municipality does not have standing to sue under this act because it is not an "aggrieved person" as defined by statute. The law was intended to protect individuals from discriminatory housing practices, and extending its protections to municipalities would be beyond Congress' intent when drafting the legislation. Furthermore, he contended that allowing such suits could lead to unnecessary litigation and potentially burden courts with cases brought by parties who were not directly harmed by alleged discrimination. In his view, only those who suffered direct harm should be allowed legal recourse.