El Dorado Estates v. City of Fillmore ( 2014 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
EL DORADO ESTATES, a California No. 12-55549
Limited Partnership,
Plaintiff-Appellant, D.C. No.
2:11-cv-07562-
v. SJO-RZ
CITY OF FILLMORE, a California
Municipal Corporation, OPINION
Defendant-Appellee.
Appeal from the United States District Court
for the Central District of California
S. James Otero, District Judge, Presiding
Argued and Submitted
November 7, 2013—Pasadena, California
Filed September 2, 2014
Before: Alfred T. Goodwin, Raymond C. Fisher,
and Richard R. Clifton, Circuit Judges.
Opinion by Judge Clifton
2 EL DORADO ESTATES V. CITY OF FILLMORE
SUMMARY*
Fair Housing Act / Standing
The panel reversed the dismissal, for lack of Article III
standing, of a seniors-only mobile home park owner’s action
claiming violations of the Fair Housing Act when the City of
Fillmore, California, allegedly interfered with an application
for a subdivision of the mobile home park by causing
unreasonable delays and imposing extralegal conditions
because of a fear that subdivision would lead to the opening
of the park to families.
The panel held that, under the facts alleged in the
complaint, the mobile home park owner suffered a concrete
and particularized, actual injury, in the form of added
expenses caused by the city’s interference with the
subdivision application, and therefore had Article III standing
to prosecute the action. The panel reversed the district court
and remanded for further proceedings.
COUNSEL
Robert S. Coldren and Mark D. Alpert (argued), Hart, King
& Coldren, Santa Ana, California, for Plaintiff-Appellant.
Jeffrey Malawy (argued), Aleshire & Wynder, LLP, Irvine,
California; J. Roger Myers and Charmaine Hilton Buehner,
*
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
EL DORADO ESTATES V. CITY OF FILLMORE 3
Myers, Widders, Gibson & Jones, LLP, Ventura, California,
for Defendant-Appellee.
OPINION
CLIFTON, Circuit Judge:
Fair housing is the topic of the day, as we are presented
with a case involving the Fair Housing Act (“FHA”). El
Dorado Estates (“El Dorado”), is a mobile home park owner
located in the City of Fillmore (“City”), California. Litigation
between El Dorado and the City arose out of El Dorado’s
application for a subdivision of its seniors-only mobile home
park, the El Dorado Estates Mobile Home Park (the “Park”).
In its complaint, El Dorado alleges that the City interfered
with the application by causing unreasonable delays and
imposing extralegal conditions because of a fear that
subdivision would lead to El Dorado opening the Park to
families.
Protracted state court proceedings surrounding the legality
of various conditions the City imposed on El Dorado when
processing its subdivision application eventually led to El
Dorado bringing this action in federal court, alleging that the
City’s actions violated various provisions of the FHA. El
Dorado’s complaint was dismissed by the district court for
lack of standing under Article III.
We disagree that El Dorado lacks Article III standing.
When the injury suffered by El Dorado is construed as
alleged in El Dorado’s complaint, it becomes clear that El
Dorado has suffered a concrete and particularized, actual,
injury, in the form of added expenses caused by the City’s
4 EL DORADO ESTATES V. CITY OF FILLMORE
interference with El Dorado’s subdivision application.
Accordingly, we reverse the district court and remand for
further proceedings.
I. Background1
El Dorado is the owner of a mobile home park located
within the City. The Park is operated by El Dorado as a senior
rental park, in which homes are rented out to residents who
are 55 years of age or older.
In 2008, at the request of Park residents, the City
considered adopting a mobile home rent control ordinance. El
Dorado publicly discussed opening the Park to families—that
is, to residents of all ages, including children—in response to
the rent control ordinance, an action that it is free to
undertake without seeking approval from the City or the
Park’s residents. It instead decided to exit the rental mobile
home park business by subdividing the Park into single lots
to be sold to residents.
The legal saga that eventually led to this case began when
El Dorado applied to the City for a subdivision pursuant to
California law. Many residents opposed the subdivision for
fear that it would lead to the Park’s conversion from a senior
park to a family park, and the City twice deemed the
application incomplete and imposed additional requirements
not contemplated by California law. The City’s efforts
delayed, increased the cost of, and prevented the subdivision.
1
Consistent with the motion to dismiss stage of the proceedings, we
recount the background accepting the allegations in El Dorado’s complaint
as true.
EL DORADO ESTATES V. CITY OF FILLMORE 5
In response, El Dorado sued the City in California state
court. There, El Dorado was successful in obtaining a court
order that eliminated the vast majority of the requirements
imposed by the City. The City thereafter approved the
application, subject to compliance with local flood mitigation
regulations and with the California Environmental Quality
Act (“CEQA”), a condition that was imposed contrary to the
City staff’s judgment that the subdivision was exempt from
CEQA review.
The CEQA condition may have been merely pretextual.
City officials made statements that suggest that the City used
the CEQA condition as a way to prevent the conversion to a
family park. The City further offered to waive the CEQA
condition if El Dorado would commit to maintaining the Park
as a senior park. El Dorado went back to state court to
challenge the imposition of the conditions. Although the court
upheld the imposition of the CEQA environmental review, it
prohibited the City from considering local regulations.
In light of the protracted litigation and imposition of the
CEQA condition that survived El Dorado’s challenge in state
court, El Dorado filed this action. El Dorado alleged in its
First Amended Complaint as its sole cause of action that the
City violated the FHA, namely 42 U.S.C. §§ 3604(a)–(b) and
3617, which prohibit discrimination, including discriminatory
land use decisions, on account of familial status. El Dorado
further alleged that the City caused it damages through both
unreasonable delays and costly, extralegal conditions in
processing the subdivision application. In particular, El
Dorado alleged that the City “acted with the intent of
coercing, interfering with and preventing El Dorado from
potentially making housing available for families.”
6 EL DORADO ESTATES V. CITY OF FILLMORE
The City filed a motion to dismiss under Federal Rules of
Civil Procedure 12(b)(1) and 12(b)(6). The district court held
that El Dorado lacked standing under Article III and therefore
granted the City’s motion and dismissed El Dorado’s
complaint without leave to amend.
El Dorado timely appealed the district court’s order
granting the City’s motion to dismiss. We have jurisdiction
under 28 U.S.C. § 1291, and we review de novo a district
court’s decision to grant a motion to dismiss under Rule
12(b)(1). Colony Cove Props., LLC v. City of Carson,
640 F.3d 948, 955 (9th Cir. 2011).
II. Discussion
As it comes to us, this appeal raises only one substantial
question: we need to decide whether El Dorado has Article III
standing to prosecute this action against the City in federal
court. We conclude that El Dorado has standing in the
constitutional sense. We therefore reverse the district court’s
order dismissing the complaint for lack of jurisdiction and
remand for further proceedings.
Standing derives from the case-or-controversy
requirement of Article III. Allen v. Wright, 468 U.S. 737,
750–51 (1984). Standing to bring suit in federal court under
Article III is an “irreducible constitutional minimum”
consisting of three elements: injury in fact, causation, and
redressability. Lujan v. Defenders of Wildlife, 504 U.S. 555,
560–61 (1992). An injury in fact is an invasion of a legally
protected interest that is both (1) concrete and particularized
and (2) actual or imminent, as opposed to conjectural or
hypothetical. Id. at 560. Causation is satisfied so long as the
injury is “fairly traceable to the defendant’s allegedly
EL DORADO ESTATES V. CITY OF FILLMORE 7
unlawful conduct.” Allen, 468 U.S. at 751. Finally,
redressability requires only that the injury be likely to be
redressed if the requested relief is granted. Id. In the context
of the FHA and housing discrimination, a plaintiff need not
be among the class discriminated against in order to have
standing. See, e.g., Havens Realty Corp. v. Coleman, 455 U.S.
363, 378–79 (1982). In particular, an organization may have
standing to bring suit on its own behalf, without relying in a
representative capacity on the standing of any third parties.
Id.
A. Injury in Fact
The requirement of injury in fact has been the source of
much confusion in this case. The district court analyzed the
particular provisions of the FHA under which El Dorado
brought suit to conclude that the interference the City caused
with El Dorado’s subdivision application “does not give rise
to a claim under the FHA because [El Dorado’s] inability to
‘potentially make housing available for families’ is not an
injury” and held that El Dorado therefore lacked standing. El
Dorado argues, however, that the district court’s analysis
misconstrues the alleged injury suffered by El Dorado. We
agree. El Dorado’s alleged injury is not its inability to make
housing available (whether potentially or not) to families.
Rather, its alleged injury consists of the expenses incurred
through unreasonable delays and extralegal conditions
imposed by the City in processing the subdivision
application, allegedly in the belief that El Dorado would be
opening the Park to families after subdivision. In other words,
the City’s interference with El Dorado’s subdivision
application directly injured El Dorado, regardless of El
Dorado’s intent with regard to providing housing for families.
8 EL DORADO ESTATES V. CITY OF FILLMORE
It is a concrete and particularized injury suffered only by El
Dorado, and it is an actual injury that requires no conjecture.
It is true, as the City argues, that this injury exists as a
legally protected interest only because the FHA prohibits
discrimination against families, thereby creating a new legal
right “the invasion of which creates standing.” Lujan,
504 U.S. at 578 (quoting Warth v. Seldin, 422 U.S. 490, 500
(1975)). What El Dorado has alleged, which we must take as
true at the motion to dismiss stage, is that the City has
discriminated against families by interfering with El Dorado’s
subdivision application and conditioning application approval
on El Dorado’s promising not to open the Park to families.
The right not to have to endure housing discrimination, even
if one is not among the class of persons discriminated against,
is a constitutionally cognizable legal interest supporting
standing. See Havens, 455 U.S. at 378–79 (holding that an
organization has standing in its own capacity to sue to recoup
costs incurred in combating racially discriminatory steering
practices); see also id. at 375–78 (opening the door to a white
plaintiff bringing suit against a property owner for housing
discrimination against blacks under the rubric of
“‘neighborhood’ standing”). El Dorado’s alleged injury thus
satisfies the injury-in-fact requirement.2
B. Causation and Redressability
Having established the actual injury alleged by El
Dorado, causation and redressability easily follow.
2
Viewing the injury alleged by El Dorado as described in this section,
we also conclude that El Dorado’s claims are ripe for adjudication. See
Thomas v. Anchorage Equal Rights Comm’n, 220 F.3d 1134, 1138–39
(9th Cir. 1999) (en banc).
EL DORADO ESTATES V. CITY OF FILLMORE 9
The delays and additional expenses El Dorado was
subjected to were a direct result of the City’s alleged
interference with the subdivision application. El Dorado’s
allegations therefore demonstrate that its injury is fairly
traceable to the City’s conduct.
In addition, the district court could redress El Dorado’s
alleged injuries. It could award damages that would allow El
Dorado to recoup the additional costs incurred in connection
with the City’s interference with the subdivision application.
It could also enjoin the City from continuing to delay the
processing of or impose extralegal conditions on the
subdivision application. El Dorado’s alleged injury is thus
likely to be redressed were the court to grant its requested
relief.
In sum, we conclude that El Dorado has Article III
standing to prosecute this action against the City.
As an alternative basis to affirm the district court’s
judgment, the City argues that El Dorado has failed to state a
claim under Rule 12(b)(6), referencing the motion to that
effect it filed in the district court. Having dismissed the action
under Rule 12(b)(1), the district court did not reach that Rule
12(b)(6) motion. We decline to take it up in the first instance.
Subsequent to the district court’s order in this case, the
Supreme Court indicated that the question of whether a
particular plaintiff has a right to sue under a given substantive
statute, though often previously discussed as “prudential
standing,” is more appropriately dealt with not in terms of
standing but instead as a matter of statutory interpretation,
determining “whether a legislatively conferred cause of
action encompasses a particular plaintiff’s claim.” Lexmark
Int’l, Inc. v. Static Control Components, Inc., 134 S. Ct. 1377,
10 EL DORADO ESTATES V. CITY OF FILLMORE
1387 (2014). If raised, that question should be addressed by
the district court.
III. Conclusion
El Dorado has established Article III standing.
Accordingly, the district court’s order dismissing the
complaint for lack of jurisdiction must be reversed. We
remand for further proceedings.
REVERSED and REMANDED.