Dean Hotop v. City of San Jose ( 2020 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
DEAN HOTOP; KEN SCHNEEBELI; JEFF No. 18-16995
ZELL; SHERMAN ZELL; LOIS ZELL;
LOUISE PETER; SEIGI TADOKORO; D.C. No.
PAT CREMA; SEAN RHINEHART; 5:18-cv-02024-
SHUCHUN HUANG; JAMES LHK
CAMPAGNA; SAL RUIZ; ISAAC AGAM;
STEVE MAHL; LLOYD KIP; ROBERTA
MOORE; DENG LIU; SHASHA CHEN; OPINION
SMALL PROPERTY OWNERS
ASSOCIATION - SAN JOSE;
ZHONGHUA PEI; XIAOCONG YE;
XIAODONG LI,
Plaintiffs-Appellants,
v.
CITY OF SAN JOSE, a municipal
corporation,
Defendant-Appellee.
Appeal from the United States District Court
for the Northern District of California
Lucy H. Koh, District Judge, Presiding
Argued and Submitted January 9, 2020
Pasadena, California
Filed December 7, 2020
2 HOTOP V. CITY OF SAN JOSE
Before: Paul J. Watford, Mark J. Bennett, and
Kenneth K. Lee, Circuit Judges.
Per Curiam Opinion;
Concurrence by Judge Bennett
SUMMARY *
Civil Rights
The panel affirmed the district court’s dismissal of an
action alleging that certain provisions of the City of San
Jose’s 2017 Ordinance and implementing regulations,
pertaining to the City’s Apartment Rent Ordinance, violated
plaintiffs’ Fourth, Fifth, and Fourteenth Amendment rights,
as well as the Contracts Clause.
The challenged provisions and regulations require
landlords to disclose information about rent stabilized units
to the City and condition landlords’ ability to increase rents
on providing that information. Specifically, landlords are
required to complete an annual registration of their rent
stabilized units, re-register whenever a tenant vacates a rent-
stabilized unit, and comply with certain requirements when
offering to buy out a tenant’s lease.
The panel first held that plaintiffs failed to adequately
allege that they have a reasonable expectation of privacy in
the information contained in the business records at issue.
*
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
HOTOP V. CITY OF SAN JOSE 3
The panel noted that the complaint did not contain any
factual allegations distinguishing the information at issue in
this case from the similar information landlords already
provide to the City in other contexts under regulations whose
validity has not been challenged. Because plaintiffs had not
plausibly alleged that the challenged provisions effected a
search, their Fourth Amendment claim failed.
The panel held that the ordinance did not work any type
of per se taking, for example by a physical invasion or by
depriving the property owner of all beneficial use of the
property. Thus, any takings claim had to be judged under
the multi-factor test enunciated in Penn Central
Transportation Co. v. New York City, 438 U.S. 104 (1978).
The panel agreed with the district court that the operative
complaint alleged no facts that would plausibly assert a
regulatory taking.
The panel determined that plaintiffs failed to state a
Contacts Clause claim. The panel further rejected plaintiffs’
equal protection claim and the substantive and procedural
due process claims. Finally, the panel determined that the
2017 Ordinance did not violate the “unconstitutional
conditions” doctrine, as enunciated in Koontz v. St. Johns
River Water Management District, 570 U.S. 595 (2013).
Concurring in part II and concurring in the result, Judge
Bennett stated that he would deny plaintiffs’ Fourth
Amendment claim because the City had conducted no Fourth
Amendment search. The Supreme Court’s Fourth
Amendment jurisprudence has consistently found that
government collection of information effects a search only
when it involves some physical intrusion or its functional
equivalent. Judge Bennett fully concurred with the
4 HOTOP V. CITY OF SAN JOSE
majority’s opinion that the remaining claims also lacked
merit.
COUNSEL
Frank A. Weiser (argued), Los Angeles, California, for
Plaintiffs-Appellants.
Malgorzata Laskowska (argued), Senior Deputy City
Attorney; Ardell Johnson, Chief Deputy City Attorney;
Richard Doyle, City Attorney; Office of the City Attorney,
San Jose, California; for Defendant-Appellee.
Barbara J. Parker, City Attorney; Maria Bee, Chief Assistant
City Attorney; Erin Bernstein, Supervising Deputy City
Attorney; Jaclyn Harris, Neighborhood Law Corps
Attorney; Kent Qian, Deputy City Attorney; Office of the
City Attorney, Oakland, California; for Amicus Curiae
League of California Cities.
Whitty Somvichian and Brandon V. Stracner, Cooley LLP,
Palo Alto, California; Nadia Aziz, Law Foundation of
Silicon Valley; for Amici Curiae Law Foundation of Silicon
Valley and Sacred Heart Community Service.
OPINION
PER CURIAM:
In 2017, the City of San Jose passed Ordinance 30032
(“Ordinance”) to amend the City’s Apartment Rent
Ordinance, and adopted Resolution 78413 to establish
regulations for implementing the Ordinance
HOTOP V. CITY OF SAN JOSE 5
(“Regulations”). Certain provisions of the Ordinance and
Regulations require landlords to disclose information about
rent stabilized units to the City and condition landlords’
ability to increase rents on providing that information. These
provisions are challenged by individual apartment owners
subject to the Ordinance and by the Small Property Owners
Association-San Jose, an unincorporated trade association of
San Jose landlords. Plaintiffs sued under 42 U.S.C. § 1983,
claiming that the challenged provisions violate their Fourth,
Fifth, and Fourteenth Amendment rights, as well as the
Contracts Clause. The district court granted the City’s
motion to dismiss plaintiffs’ first amended complaint
without prejudice. Plaintiffs chose to stand on that
complaint and now appeal. Reviewing the district court’s
decision de novo, see Arpin v. Santa Clara Valley
Transportation Agency, 261 F.3d 912, 923 (9th Cir. 2001),
we affirm.
I
Plaintiffs’ Fourth Amendment claim is predicated on
their theory that the Ordinance and Regulations violate the
prohibition against unreasonable searches by requiring
landlords to provide certain information to the City through
the Director of the Department of Housing. The claim
implicates three different disclosure requirements applicable
to rent stabilized units. 1
First, plaintiffs point to the required annual registration
of rent stabilized units under San Jose Municipal Code
1
Subject to a few exceptions, a “rent stabilized unit” is a rental unit
“for which a certificate of occupancy was issued on or prior to September
7, 1979 or that was offered or available for rent on or before this date.”
San Jose Municipal Code § 17.23.167(A).
6 HOTOP V. CITY OF SAN JOSE
(“SJMC”) § 17.23.900. To complete the annual registration,
§ 4.05 of the Regulations requires landlords to submit to the
City, on a City-provided form, the following information:
the address of the subject unit; the name and address of each
landlord of the unit; the occupancy status and
commencement date of the current tenancy; a history of the
rent charged for use and occupancy of the unit; the amount
charged as a security deposit; the metering status of the unit;
the names of all tenants occupying the unit; and any
household services provided at the start of the current
tenancy. Second, plaintiffs point to the Ordinance’s re-
registration requirements. When a tenant vacates a rent
stabilized unit, the landlord must re-register the unit by
submitting a City-approved form that discloses the following
information: the address of the unit; the reason the prior
tenant vacated the unit, if known; the names of subsequent
tenants; the rent charged to subsequent tenants; and a copy
of the rental agreement between the landlord and subsequent
tenants. SJMC § 17.23.600(C). Finally, plaintiffs point to
the Ordinance’s buyout requirements. A landlord offering
to buy out a tenant’s lease must make certain mandatory
disclosures to the tenant. When a tenant accepts a landlord’s
buyout offer, the landlord must provide the City with
executed copies of the agreement and disclosure form.
SJMC § 17.23.700.
Landlords violating the Ordinance face civil penalties
and misdemeanor criminal charges punishable by up to six
months in jail. SJMC § 17.23.500(A). 2 Additionally,
2
Section 17.23.500(A) lists the civil penalties and provides that
violators face “all other remedies provided by law, including those set
forth in Chapter 1.08 of Title 1 of the San Jose Municipal Code . . . .”
Chapter 1.08 in turn provides that violations of any City Ordinance can
HOTOP V. CITY OF SAN JOSE 7
landlords who fail to comply with the registration or re-
registration requirements may not increase rent for
unregistered units. SJMC § 17.23.310. Landlords who
charge fees or rents higher than what is allowed by the
Ordinance or Regulations are guilty of a misdemeanor.
SJMC § 17.23.530.
The first question raised by plaintiffs’ Fourth
Amendment claim is whether the challenged provisions
effect a “search.” A Fourth Amendment search occurs when
the government either physically intrudes upon “persons,
houses, papers, [or] effects” or invades “a person’s
‘reasonable expectation of privacy’” in one of the
constitutionally enumerated areas. United States v. Jones,
565 U.S. 400, 405–06 (2012) (quoting Katz v. United States,
389 U.S. 347, 360 (1967)). With respect to searches of
“papers,” we need not decide whether the Fourth
Amendment is implicated only by a physical inspection of
the documents themselves. Even if the Fourth Amendment
is implicated by certain non-physical intrusions, in that
context the plaintiff must have a reasonable expectation of
privacy in the contents of the documents before the
government’s conduct can be deemed a Fourth Amendment
“search.” And here, as the district court held, plaintiffs
failed to adequately allege that they have a reasonable
expectation of privacy in the information contained in the
business records at issue. 3
be a misdemeanor punishable by fine, imprisonment of up to six months,
or both.
3
For the first time on appeal, plaintiffs also seek to ground their
Fourth Amendment claim on a “property interest” in their business
records, derived from California Civil Code § 1947.7(g) and independent
of their privacy interests. Because this argument was not raised in the
8 HOTOP V. CITY OF SAN JOSE
Plaintiffs’ sole substantive allegation regarding privacy
is that the information they must disclose under the
challenged provisions “constitute plaintiffs’ private business
records that is not found in the public domain.” The district
court found this lone allegation, without additional factual
matter, insufficient to establish a reasonable expectation of
privacy in the information subject to disclosure. The court
noted that San Jose landlords are already required to provide
similar information about rent stabilized units to the City by
other regulations not challenged here. As one example,
when landlords petition to raise the rent by more than is
ordinarily permitted, they must provide financial
information showing their net operating income in both a
“base year” (usually 2014) and the current year. SJMC
§§ 17.23.800–870. This information must suffice to show
(1) income from all sources, including rent, laundry, and
other services, as well as interest on tenant deposits; and
(2) expenses, including fees, taxes, utilities, insurance,
maintenance, managerial and administrative costs, and legal
fees. Landlords can establish these items using a variety of
evidence, including “receipts, cancelled checks, and detailed
invoices” (which the Regulations consider “the best
documentation”), as well as tax returns, ledgers, and
insurance claims. Regulations § 8.02.02. As another
example, when landlords petition to pass through to tenants
the cost of capital improvements, they must provide the
number of units affected; the occupancy status and rent
charged for each unit; and detailed records concerning the
improvement itself, including “invoices and proof of
payment” and “[a] copy of the building permit(s) and final
inspection(s).” Regulations § 9.02.1. Although the details
differ, the information that landlords must submit under
district court, we decline to address it. See In re Mortgage Electronic
Registration Systems, Inc., 754 F.3d 772, 780 (9th Cir. 2014).
HOTOP V. CITY OF SAN JOSE 9
these regulations overlaps to a significant degree with the
information landlords must disclose under the challenged
provisions.
Confronted with this overlap, the district court
concluded that plaintiffs’ lone allegation concerning privacy
does not “explain how the information implicated by the
Ordinance disclosure requirements differs meaningfully
from” the information landlords already disclose in other
contexts. The court thus dismissed plaintiffs’ Fourth
Amendment claim with leave to amend. As noted, however,
plaintiffs did not amend their complaint, and they rely on the
same lone allegation on appeal.
We agree with the district court that plaintiffs’ complaint
fails to allege facts plausibly suggesting that they have a
reasonable expectation of privacy in the information that
must be disclosed under the challenged provisions. The
complaint does not contain any factual allegations
distinguishing the information at issue in this case from the
similar information landlords already provide to the City in
other contexts under regulations whose validity has not been
challenged.
The district court’s ruling is supported by our recent
decision in San Francisco Apartment Association v. City and
County of San Francisco, 881 F.3d 1169 (9th Cir. 2018). In
that case, landlords in San Francisco argued that a similar
ordinance, which required landlords to provide tenant
buyout agreements to the city for inclusion in a publicly
searchable database, violated their right to privacy under the
California Constitution. See id. at 1173–75. Affirming the
district court’s grant of judgment on the pleadings, we held
that the landlords had no “reasonable expectation of privacy
in the information” because they “offer no explanation why”
the information at issue “is more sensitive or private than
10 HOTOP V. CITY OF SAN JOSE
other financial information routinely submitted to the
government and made publicly available” in other contexts.
Id. at 1178; see also In re Facebook, Inc. Internet Tracking
Litigation, 956 F.3d 589, 604 n.7 (9th Cir. 2020) (treating as
comparable the reasonable expectation of privacy under the
California Constitution and the Fourth Amendment). The
district court applied the same rule here: As in San
Francisco Apartment Association, plaintiffs in this case
offered no factual allegations plausibly suggesting that they
maintain a reasonable expectation of privacy in information
that, generally speaking, they already disclose to the City in
other contexts. 4
Our decision in Patel v. City of Los Angeles, 738 F.3d
1058 (9th Cir. 2013) (en banc), aff’d, 576 U.S. 409 (2015),
on which plaintiffs rely, is not to the contrary. The ordinance
challenged in Patel permitted police officers to perform
warrantless, on-demand inspections of hotel owners’ guest
registries. Id. at 1061. But in that case no one contested that
the information contained in the guest registries was private,
for it was undisputed that hotel owners “do not ordinarily
disclose, and are not expected to disclose, the kind of
commercially sensitive information contained in the [guest
registries].” Id. at 1062. Because there was no indication in
4
It bears noting that plaintiffs’ allegations support only a facial
challenge to the regulations at issue; nothing in the complaint supports a
claim that the regulations are invalid as applied to any of the individual
plaintiffs. Thus, the complaint does not allege, for example, that
individual apartment owners have not in the past petitioned the City to
raise rent by more than the ordinary amount, or to pass through the cost
of capital improvements. Nor does the complaint allege that, even if
individual apartment owners have petitioned the City for those purposes,
the information demanded by those petitions does not actually overlap
with the information that must be disclosed under the challenged
provisions.
HOTOP V. CITY OF SAN JOSE 11
Patel that the hotel owners provided their guest registries or
similar information to the government in other situations, the
plaintiffs did not need to allege additional facts concerning
the private nature of the information contained in the
registries. Here we confront the opposite situation. As a
result, for the reasons discussed above, additional factual
allegations were necessary before the district court could
plausibly infer that plaintiffs maintained a reasonable
expectation of privacy in the information contained in the
business records at issue. And despite being afforded an
opportunity to allege additional facts in support of their
claims, plaintiffs declined to do so.
As we hold that plaintiffs have not plausibly alleged that
the challenged provisions effect a search, their Fourth
Amendment claim fails.
II
Plaintiffs’ remaining claims also lack merit.
A. Fifth Amendment Takings Claim
Plaintiffs contend the Ordinance effects a per se taking
of private property, in violation of the Fifth Amendment.
But the Ordinance does not work any type of per se taking,
for example by a physical invasion, Loretto v. Teleprompter
Manhattan CATV Corp., 458 U.S. 419 (1982), or by
depriving the property owner of all beneficial use of the
property, Lucas v. South Carolina Coastal Council, 505 U.S.
1003 (1992). Thus, any takings claim must be judged under
the multi-factor test enunciated in Penn Central
Transportation Co. v. New York City, 438 U.S. 104 (1978).
These factors include (1) “[t]he economic impact of the
regulation on the claimant,” (2) “the extent to which the
regulation [interferes] with distinct investment-backed
12 HOTOP V. CITY OF SAN JOSE
expectations,” and (3) “the character of the government
action.” Id. at 124.
Plaintiffs complain of a regulatory taking on appeal, but
as the district court correctly found, the operative complaint
alleges no facts that would plausibly assert a regulatory
taking. Indeed, the only allegation even arguably relevant to
a regulatory taking claim is that landlords “cannot increase
rents on their tenants” if they fail to comply with the
Ordinance and Regulations. But “when buying a piece of
property, one cannot reasonably expect that property to be
free of government regulation such as zoning, tax
assessments, or . . . rent control.” Rancho de Calistoga v.
City of Calistoga, 800 F.3d 1083, 1091 (9th Cir. 2015).
Plaintiffs do not raise a colorable Fifth Amendment takings
claim.
B. Contracts Clause Claim
“The threshold issue [in a Contracts Clause analysis] is
whether the state law has ‘operated as a substantial
impairment of a contractual relationship.’ In answering that
question, the Court has considered the extent to which the
law undermines the contractual bargain, interferes with a
party’s reasonable expectations, and prevents the party from
safeguarding or reinstating his rights.” Sveen v. Melin,
138 S. Ct. 1815, 1821–22 (2018) (citation omitted). As the
district court correctly found, “Plaintiffs include only the
vague allegation that the Ordinance and Regulations affect
plaintiffs’ contracts with their tenants, but plaintiffs do not
specify how the Ordinance disclosure requirements affect
HOTOP V. CITY OF SAN JOSE 13
those contracts.” 5 Plaintiffs have not stated a Contracts
Clause claim.
C. Equal Protection
We review plaintiffs’ equal protection claim under the
rational basis test, as they are not members of a suspect class.
Dandridge v. Williams, 397 U.S. 471, 485 (1970). 6
Plaintiffs allege no facts that even arguably show the
Ordinance’s various distinctions (including between unit
types) are irrational, nor do they argue this on appeal. That
5
For the first time on appeal, plaintiffs specifically argue that the
Ordinance retroactively voids any pass-through contracts. Not only did
plaintiffs fail to raise this argument below, but they do not point to any
allegation in their complaint to support it. Again, we see no reason to
depart from the general rule that we do not consider issues not raised
below. We also note that plaintiffs requested leave to amend “to specify
the contractual relationships at issue that give rise to the claim.” But
after the district court granted leave to amend, plaintiffs chose not to
amend.
6
Plaintiffs claim strict scrutiny applies but offer no reasoned
argument that we can discern in support of that proposition. Plaintiffs
appear to assert that their equal protection claim is subsumed by their
Fourth Amendment claim, which therefore requires us to apply strict
scrutiny to their now subsumed equal protection claim. Plaintiffs’
reliance for this proposition on a footnote in Orin v. Barclay, 272 F.3d
1207 (9th Cir. 2001), is severely misplaced. We treated the equal
protection claim as subsumed in Orin because the plaintiff’s equal
protection claim “appear[ed] to be . . . a First Amendment claim dressed
in equal protection clothing” and because “the substantive guarantees of
the [First] Amendment serve as the strongest protection against the
limitation of these rights” for those “class[es] of persons under the equal
protection guarantee.” Id. at 1213 n.3. We did not otherwise analyze an
Equal Protection claim, let alone state that strict scrutiny must be applied
to an Equal Protection claim made by individuals that are not members
of a suspect class. Plaintiffs make no argument that “intermediate
scrutiny” applies.
14 HOTOP V. CITY OF SAN JOSE
alone is reason to reject their equal protection claim. That
said, we agree with the district court that the distinctions
drawn by the Ordinance appear easily to survive rational
basis review. For example, the set of units covered by the
Apartment Rent Ordinance was not expanded to include
duplexes because the City would need to expend significant
resources to transition thousands of new owners into the
program. See Woods v. Miller Co., 333 U.S. 138, 145 (1948)
(“[A legislative body] need not control all rents or none. It
can select those areas or those classes of property where the
need seems the greatest.”); see also Equity Lifestyle
Properties, Inc. v. County of San Luis Obispo, 548 F.3d
1184, 1195 (9th Cir. 2008) (affirming dismissal of an equal
protection challenge where the regulation of mobile home
park rents satisfied rational basis review as the regulation
was motivated by “distinguishing characteristics relevant to
interests the State has the authority to implement” (citation
omitted)).
D. Substantive and Procedural Due Process
Plaintiffs assert both substantive and procedural due
process claims. 7 But both require, as a threshold matter, that
plaintiffs show they were deprived of a “constitutionally
protected life, liberty or property interest.” Shanks v.
7
For the first time on appeal, plaintiffs state that their procedural
due process claim relates to how hearing officers are selected, as
described in § 11.01.1 of the Regulations. While plaintiffs’ complaint
and first amended complaint mention “procedural due process” in
passing, neither alleges any facts relating to the administrative hearing
process or the selection of hearing officers, and neither references
§ 11.01.1. Plaintiffs’ opposition to the City’s motion to dismiss does not
even respond to the City’s argument that plaintiffs failed to state a
procedural due process claim. Once again, as plaintiffs did not raise this
argument below, we decline to consider it here.
HOTOP V. CITY OF SAN JOSE 15
Dressel, 540 F.3d 1082, 1087 (9th Cir. 2008) (discussing
substantive due process); id. at 1090 (stating that to be
entitled to relief under a procedural due process claim, a
plaintiff must establish (1) a protected liberty or property
interest, (2) the governmental deprivation of that interest,
and (3) a “lack of process”); see also Bd. of Regents of State
Colleges v. Roth, 408 U.S. 564, 569–70 (1972) (recognizing
that the requirements of procedural due process apply only
to those interests encompassed by the Fourteenth
Amendment and that “the range of interests protected . . . is
not infinite”).
We agree with the district court that the first amended
complaint does not articulate how the Ordinance and
Regulations harm plaintiffs’ own liberty and property
interests. 8 Plaintiffs argue that the Ordinance and
Regulations infringe on their tenants’ privacy rights, thus
forcing plaintiffs to choose between “disclosing the tenants’
personal information violating their due process rights (and
possibly being sued)” or not complying with the Ordinance
and “suffering severe . . . sanctions.” This argument does
not identify any harm to plaintiffs’ own liberty or property
interests. And we reject plaintiffs’ claim of a substantive due
process violation flowing from the alleged “unconstitutional
conditions.” As discussed below, there can be no
“unconstitutional conditions” when there is no
unconstitutionality.
8
For the first time on appeal, plaintiffs assert that their own property
rights are implicated because their business records are private and
protected by Article 1, § 1 of the California Constitution and California
Civil Code § 1947.7(g). Because plaintiffs did not make this claim in
either their complaint or first amended complaint and did not raise it in
opposition to the City’s motion to dismiss, we do not consider it here.
16 HOTOP V. CITY OF SAN JOSE
E. Unconstitutional Conditions
Finally, plaintiffs contend that the Ordinance violates the
“unconstitutional conditions” doctrine, as enunciated in
Koontz v. St. Johns River Water Management District,
570 U.S. 595 (2013). “A predicate for any unconstitutional
conditions claim is that the government could not have
constitutionally ordered the person asserting the claim to do
what it attempted to pressure that person into doing.” Id.
at 612. But whether we view the Ordinance as pressuring or
ordering, plaintiffs’ claim fails, as plaintiffs have shown no
unconstitutionality. The Ordinance’s requirements violate
no Fourth, Fifth, or Fourteenth Amendment rights of
plaintiffs, and thus the pressure the City exerts through
sanctions for non-compliance is constitutionally irrelevant.
AFFIRMED.
BENNETT, Circuit Judge, concurring in part 1 and
concurring in the result:
The Fourth Amendment to the Constitution provides:
The right of the people to be secure in their
persons, houses, papers, and effects, against
unreasonable searches and seizures, shall not
be violated, and no Warrants shall issue, but
upon probable cause, supported by Oath or
affirmation, and particularly describing the
1
I fully concur in Part II of the majority’s opinion.
HOTOP V. CITY OF SAN JOSE 17
place to be searched, and the persons or
things to be seized.
U.S. Const. amend. IV. The Ordinance challenged here
requires plaintiffs to record and disclose information about
property leasing to the City of San Jose. The City neither
enters plaintiffs’ houses or places of business to obtain the
information, nor does it seize, intercept, or surreptitiously
obtain any of plaintiffs’ papers or effects. The City procures
no warrants. Instead, the City provides forms for the
plaintiffs to fill out and return. Like regulators throughout
the country at every level of government, the City penalizes
those who fail to provide the information it requires.
Plaintiffs claim the Ordinance violates the Fourth
Amendment. Like the majority, I agree that it doesn’t. But
while the majority relies on the plaintiffs’ lack of a
reasonable expectation of privacy in the information
divulged to the City, 2 I would deny the plaintiffs’ Fourth
Amendment claim for a far more fundamental reason—the
City has conducted no Fourth Amendment search. 3
In Katz v. United States, 389 U.S. 347 (1967), the
Supreme Court famously held that “the Fourth Amendment
protects people, not places.” Id. at 351. And the Court later
adopted Justice Harlan’s formulation: “[A] person has a
constitutionally protected reasonable expectation of privacy;
[and] electronic as well as physical intrusion into a place that
is in this sense private may constitute a violation of the
Fourth Amendment . . . .” Id. at 360 (Harlan, J., concurring);
see Terry v. Ohio, 392 U.S. 1, 9 (1968). Katz, of course,
2
I do not expressly disagree with the majority as to its “reasonable
expectation of privacy” analysis, because I do not reach the question.
3
Plaintiffs do not argue the City “seized” anything.
18 HOTOP V. CITY OF SAN JOSE
involved a physical intrusion by government—the
placement of a hidden listening device on a phone booth.
389 U.S. at 348.
Since Katz, the Court has afforded Fourth Amendment
protection in a variety of situations, like a government
agent’s physical manipulation of a carry-on bag placed in an
overhead compartment on a bus, Bond v. United States,
529 U.S. 334, 338–39 (2000), or the government obtaining
an individual’s cell-site location information through court
orders obtained under the Stored Communications Act,
Carpenter v. United States, 138 S. Ct. 2206, 2212, 2217
(2018). Part of the Court’s analysis in these cases involved
a person’s “reasonable expectation of privacy.” But that
analysis comes into play only if there is a search or seizure,
like the Katz concealed listening device, the Bond “tactile
inspection,” or the Carpenter court order. Though the Court
has made clear in recent years that Fourth Amendment
jurisprudence is no longer tied to a trespass-based analysis,
United States v. Jones, 565 U.S. 400, 405 (2012), nothing in
the Court’s jurisprudence suggests reading the necessity of
an actual search or seizure out of the Fourth Amendment.
An individual may have the most reasonable expectation of
privacy in certain information, but the Fourth Amendment is
not implicated until the government collects that information
through a search. See id. at 408 n.5 (“[T]he obtaining of
information is not alone a search unless it is achieved by . . .
a trespass or invasion of privacy.”).
Governments (federal, state, and local) regularly collect
information from citizens. See Whalen v. Roe, 429 U.S. 589,
605 (1977). These demands for information can be for
statistical purposes, in relation to the collection of taxes and
fees, to help determine whether government should or must
provide a requested benefit, to make certain that those who
HOTOP V. CITY OF SAN JOSE 19
hold licenses or permits are adhering to their terms, to
monitor and maintain public health, or as part of a regulatory
structure. These are only a few examples. Often the
information is confidential, nonpublic, and not known or
available to the government otherwise. And governments
regularly impose sanctions for failing to transmit the
information (like losing a benefit or facing a penalty). Other
constitutional provisions regulate these types of information
demands, 4 but the Fourth Amendment does not. Though the
Fourth Amendment has developed since Katz, nothing in the
Court’s jurisprudence is at odds with Katz’s reminder that
“the Fourth Amendment cannot be translated into a general
constitutional ‘right to privacy.’” 389 U.S. at 350; see id.(“Other provisions of the Constitution protect personal
privacy from other forms of governmental invasion.”).
Rather, the Supreme Court’s Fourth Amendment
jurisprudence has consistently found that government
collection of information effects a search only when it
involves some physical intrusion or its functional equivalent.
Cf. Bond, 529 U.S. at 337 (“Physically invasive inspection
is simply more intrusive than purely visual inspection.”).
Trespass on private property can obviously constitute a
search. Jones, 565 U.S. at 404–05. Newer investigatory
techniques, if they function like physical intrusions, can also
constitute searches. So, in Katz, the government effected a
search when it placed a hidden listening device that
electronically intruded into a closed phone booth to overhear
4
The Due Process Clauses of the Fifth and Fourteenth Amendments
can be implicated by government regulation. See, e.g., Whalen, 429 U.S.
at 598–604. Likewise, the First Amendment’s associational freedom can
be burdened by government collection of information. E.g., Shelton v.
Tucker, 364 U.S. 479, 480, 487–88 (1960) (finding unconstitutional an
Arkansas law requiring public schoolteachers to submit an affidavit
listing their organizational associations).
20 HOTOP V. CITY OF SAN JOSE
private conversations. 389 U.S. at 353; id. at 362 (Harlan,
J., concurring). And in Kyllo v. United States, 533 U.S. 27(2001), the government’s collection of information using a
sense-enhancing device “that is not in general public use, to
explore details of the home that would previously have been
unknowable without physical intrusion,” also constituted a
search. Id. at 40. Such a result “assures preservation of that
degree of privacy against government that existed when the
Fourth Amendment was adopted.” Id. at 34. As Justice
Scalia, writing for the Court, specifically noted:
When the Fourth Amendment was adopted,
as now, to “search” meant “[t]o look over or
through for the purpose of finding something;
to explore; to examine by inspection; as, to
search the house for a book; to search the
wood for a thief.”
Id. at 32 n.1 (quoting N. Webster, An American Dictionary
of the English Language 66 (1828) (reprint 6th ed. 1989)).
The government may also conduct a constructive search
by collecting information through an “orderly taking under
compulsion of process.” United States v. Morton Salt Co.,
338 U.S. 632, 652 (1950); Hale v. Henkel, 201 U.S. 43, 76
(1906) (“While a search ordinarily implies a quest by an
officer of the law . . . the substance of the offense is the
compulsory production of private papers, whether under a
search warrant or a subpoena duces tecum . . . .”). In this
context, it is the government process effecting access to the
protected papers and records that implicates the Fourth
Amendment. Court orders directing the production of
information fall in this category of searches, Carpenter,
138 S. Ct. at 2217; Boyd v. United States, 116 U.S. 616, 624
(1886), as do administrative subpoenas, Okla. Press Publ’g
HOTOP V. CITY OF SAN JOSE 21
Co. v. Walling, 327 U.S. 186, 209–10 (1946). But no
Supreme Court case has found a search based on a
requirement that a person transmit information as part of a
regulatory process, even if there are penalties for
noncompliance, and even if the person has a reasonable
expectation of privacy in the requested information.
Plaintiffs rely on our en banc decision in Patel v. City of
Los Angeles (Patel I), 738 F.3d 1058 (9th Cir. 2013) (en
banc), aff’d, 576 U.S. 409 (2015), discussing administrative
searches. But Patel I serves only to confirm the Fourth
Amendment’s requirement of a physical intrusion or its
equivalent. The challenged ordinance in Patel I
“authorize[d] police officers to inspect hotel guest records at
any time without consent or a search warrant.” Id. at 1061.
Crucial to our application of the Fourth Amendment to the
warrantless inspection scheme was the method used to
obtain the record information:
A police officer’s non-consensual inspection
of hotel guest records plainly constitutes a
“search” under either the property-based
approach of Jones or the privacy-based
approach of Katz. Such inspections involve
both a physical intrusion upon the hotel’s
private papers and an invasion of the hotel’s
protected privacy interest in those papers for
the purpose of obtaining information.
Whether the officers rifle through the records
in paper form, or view the records on a
computer screen, they are doing so to obtain
the information contained in the records.
Id. at 1062 (citation omitted). Inspection of the records
intruded upon both the property rights and the privacy
22 HOTOP V. CITY OF SAN JOSE
interests of the hotel, since the hotel’s property rights in the
records gave rise to its expectation of privacy. Id. at 1061.
Thus, there was a search only because the ordinance
authorized police officers to inspect, on demand, records
physically kept at hotels.
The Supreme Court affirmed our Patel I decision and
expressed no disagreement with our search analysis. See
City of Los Angeles v. Patel (Patel II), 576 U.S. 409, 412
(2015). As the Supreme Court observed: “The en banc court
first determined that a police officer’s nonconsensual
inspection of hotel records under [the ordinance] is a Fourth
Amendment search because the business records . . . are the
hotel’s private property and the hotel therefore has the right
to exclude others from prying into their contents.” Id. at 414
(internal quotation marks and brackets omitted). Further, the
Supreme Court’s finding of a Fourth Amendment violation
turned on the ordinance’s lack of an opportunity for judicial
review prior to inspections. Id. at 421. Logically, the
inverse also holds true—in the absence of inspections, there
is no need for any precompliance judicial review, and the
Fourth Amendment is no longer implicated. Without the
statutorily authorized onsite inspection demands, there
would have been no search in Patel I.
By contrast, the Ordinance here requires landlords to
disclose information to the City’s Department of Housing as
part of a regulatory process. There is no inspection of any
kind. Nothing in the Supreme Court’s opinion in Patel II (or
our en banc opinion in Patel I) suggests that there would
have been a search had there been no physical inspection of
private business records and, instead, a statutory requirement
that hotels transmit information to the city under a regulatory
scheme.
HOTOP V. CITY OF SAN JOSE 23
But in the majority’s view, the Ordinance does not
violate the Fourth Amendment because there was no
reasonable expectation of privacy in the information sought:
Even if the Fourth Amendment is implicated
by certain non-physical intrusions, in that
context the plaintiff must have a reasonable
expectation of privacy in the contents of the
documents before the government’s conduct
can be deemed a Fourth Amendment
“search.” And here, as the district court held,
plaintiffs failed to adequately allege that they
have a reasonable expectation of privacy in
the information contained in the business
records at issue.
Majority Opinion at 7. First asking, as the majority does
here, whether plaintiffs can show that they possess a
reasonable expectation of privacy in the disclosed
information puts the cart before the horse in a manner
untethered from the language of the Fourth Amendment. See
Entick v. Carrington, 19 How. St. Tr. 1029, 1066, 95 Eng.
Rep. 807 (1765) (“[T]he eye cannot by the laws of England
be guilty of a trespass, yet where private papers are removed
and carried away, the secret nature of those goods will be an
aggravation of the trespass.”). What first determines
whether government action that obtains information
implicates the Fourth Amendment is not the nature of the
information requested; it is the method and manner of the
collection. 5 Cf. Grady v. North Carolina, 575 U.S. 306, 310
5
I acknowledge that the Supreme Court in Minnesota v. Carter,
525 U.S. 83 (1998), elected to settle the open legal question of whether
a temporary visitor to a home for business reasons could legitimately
expect privacy and thus invoke the Fourth Amendment, without first
24 HOTOP V. CITY OF SAN JOSE
(2015) (“The State’s program is plainly designed to obtain
information. And since it does so by physically intruding on
a subject’s body, it effects a Fourth Amendment search.”).
Though the majority reaches the correct ultimate result,
the harm in its approach is manifest. As noted above,
government requires its citizens to provide information all
the time. Sometimes it is part of a regulated activity scheme,
like property rental. Sometimes it is part of obtaining a
service or benefit (a driver’s license, a business license, a
title registration, a passport). Sometimes it is just part of
everyday life. For most of its actions, the government, if
challenged, need show only that its activities are “rationally
related to legitimate government interests.” Washington v.
Glucksberg, 521 U.S. 702, 728 (1997). But if other courts
follow the majority’s approach here, anyone who must
provide information to government can lodge a Fourth
Amendment challenge to the requirement based on their
“reasonable expectation of privacy” in the information
sought. Allowing a Fourth Amendment claim to proceed
with such allegations of privacy, but with no plausible
determining whether the police observation into the home in that case
was a search. Id. at 91. In Carter, there were strong prudential reasons
for deciding the temporary visitor issue first—that question was
necessary to address the lower court’s incorrect standing analysis, id. at
87, and it had broad ramifications for who could bring a Fourth
Amendment claim. Here, the majority’s decision to analyze the
plaintiffs’ expectations of privacy lacks any such justification. We
should not set the stage for future Fourth Amendment challenges based
on information requests, or what the majority describes as “non-physical
intrusions.” Rather, the prudent course would be to answer the seminal
question of whether an information request without inspection effects a
search, and to answer that seminal question consistent with the text of
the Fourth Amendment. In essence, the majority does the reverse of what
the Court did in Carter—leaving open a door that should be shut, rather
than appropriately shutting it.
HOTOP V. CITY OF SAN JOSE 25
allegation of an actual Fourth Amendment search, will
subject government at every level to inappropriate judicial
scrutiny of its actions—especially when it “conditions”
benefits on the reporting of information. 6 And this, contrary
to the very teachings of Katz, will cause the Fourth
Amendment to be translated into a general constitutional
right to privacy.
As there was no Fourth Amendment search here,
irrespective of whether plaintiffs had an “actual (subjective)
expectation of privacy . . . that society is prepared to
recognize as ‘reasonable,’” Katz, 389 U.S. at 361 (Harlan, J.,
concurring), we should have rejected plaintiffs’ Fourth
Amendment claim on that ground. By failing to do so, we
have saddled both government and judges with a
constitutionally inappropriate burden. For that reason, I
concur only in the result of Part I of the majority’s opinion.
6
Keep in mind that part of plaintiffs’ claim here was based on
“unconstitutional conditions.” The majority rightly rejected the
“unconstitutional conditions” claim, but its Fourth Amendment analysis
continues to allow “unconstitutional conditions” challenges to any
benefit conditioned on reporting information, so long as a plaintiff can
assert some expectation of privacy in the information.