Philly loses legal battle with HUD

March 31, 2008 9:39:28 AM PDT
A judge has denied the Philadelphia Housing Authority's request for an injunction in a dispute with U.S. Department of Housing and Urban Development.

The authority had sought a temporary restraining order to keep HUD from dropping it from a pilot public housing program. City officials say the move was retaliation for the local agency's rejection of a business deal involving a friend of the HUD chief.

U.S. District Judge Paul S. Diamond ruled Monday that the housing authority did not show it was entitled to court relief.

The authority's current 10-year contract in the Moving to Work program expires Monday. Officials say it is worth up to $50 million per year.

HUD officials say Philadelphia was dropped because it failed to meet rules on access for the handicapped.