CA Rental Housing Assoc. v. Newsom ( 2022 )

1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 EASTERN DISTRICT OF CALIFORNIA 9 10 CALIFORNIA RENTAL HOUSING No. 2:21-cv-01394-JAM-JDP ASSOCIATION, et al., 11 Plaintiffs, 12 ORDER DISMISSING ACTION FOR v. LACK OF SUBJECT MATTER 13 JURISDICTION GAVIN NEWSOM, et al. 14 Defendants. 15 16 This matter is before the Court on Plaintiffs’ motion for 17 summary judgment (“MSJ”) and Defendants’ cross-motion for summary 18 judgment (“Cross-MSJ”). See MSJ, ECF No. 10; Cross-MSJ, ECF 19 No. 16. Plaintiffs oppose Defendants’ cross-motion for summary 20 judgment. See Pls.’ Opp’n, ECF No. 19. Defendants replied. See 21 Defs.’ Reply, ECF No. 24. Plaintiffs bring three claims against 22 Defendants in their official capacity for constitutional 23 violations. See First Amended Complaint (“FAC”), ECF No. 4. For 24 the reasons set forth below, the Court dismisses this action in 25 its entirety for lack of subject matter jurisdiction.1 26 27 1 This motion was determined to be suitable for decision without oral argument. E.D. Cal. L.R. 230(g). The hearing was 28 scheduled for October 18, 2022. 1 I. BACKGROUND 2 On March 4, 2020, California Governor Gavin Newsom declared 3 a State of Emergency in response to the COVID-19 pandemic. See 4 Exh. 1 to Defs.’ Request for Judicial Notice (“DJRN”), ECF 5 No. 16-2. That same month, Governor Newsom issued executive 6 order N-33-20 (“Stay-at-Home Order”) directing all California 7 residents to heed the directives of the State Public Health 8 Officer and to stay home or at their place of residence. See 9 Exh. 5 to DJRN, ECF No. 16-2. Following the Stay-at-Home Order, 10 Governor Newsom issued executive order N-37-20 banning the 11 enforcement of unlawful detainer eviction orders from March 27 to 12 May 31, 2020, for renters affected by COVID-19. Defs.’ Statement 13 of Undisputed Facts (“DSUF”) ¶ 37, ECF No. 16-3. In the 14 executive order, Governor Newsom stated that “minimizing 15 evictions during this period is critical to reducing the spread 16 of COVID-19 in vulnerable populations by allowing all residents 17 to stay home or at their place of residence in compliance with 18 [the Stay-at-Home Order].” Exh. 5 to DJRN. 19 The California Legislature codified the protections of 20 Governor Newsom’s executive eviction moratorium on August 31, 21 2020, when the State enacted the COVID-19 Tenant Relief Act 22 (“Tenant Act”) in Assembly Bill 3088 (“AB 3088”). Code of Civ. 23 Proc. §§ 1179.01, et seq. The Tenant Act provided temporary 24 restrictions on unlawful detainer evictions of tenants if they 25 complied with certain declaration requirements. Id. Tenants who 26 submitted to their landlords declarations attesting that they 27 were unable to pay rent due to COVID-19 related hardships were 28 immunized from unlawful detainer actions for unpaid rent between 1 March 1 and August 31, 2020. §§ 1179.02(f), 1179.03(b). Subject 2 to limited exceptions, courts could not find a tenant guilty of 3 unlawful detainer for nonpayment of rent before February 1, 2021. 4 § 1179.03.5. 5 The State went on to extend and modify these restrictions 6 multiple times. See Senate Bill 91 (“SB 91”) (extending 7 restrictions to June 30, 2021); Assembly Bill 832 (“AB 832”) 8 (extending restrictions to September 30, 2021 and imposing other 9 restrictions until March 31, 2022); Assembly Bill 2179 10 (“AB 2179”) (extending restrictions to June 30, 2022). As a 11 result, unlawful detainer actions for nonpayment of rent did not 12 resume fully until July 1, 2022. 13 Plaintiffs, comprised of individual landlords and an 14 association of rental housing owners, brought this suit on 15 August 5, 2021, to challenge the constitutionality of AB 832. 16 FAC ¶¶ 1, 3. Plaintiffs allege that AB 832 constitutes “an 17 unconstitutional moratorium on the right of rental housing owners 18 to repossess their properties for nonpayment of rent” in 19 violation of the Due Process Clause, the Takings Clause, and the 20 Contracts Clause of the U.S. Constitution. Id. ¶¶ 2, 4. 21 Plaintiffs’ and Defendants’ cross-motions for summary judgment 22 are now before the Court. 23 24 II. OPINION 25 A. Judicial Notice 26 Plaintiffs request judicial notice of seven documents in 27 support of their motion for summary judgment. See Pls.’ Request 28 for Judicial Notice of Exhibits 1-6 (“PRJN”), ECF No. 11; see 1 also Pls.’ Second Request for Judicial Notice of Exhibit 7 2 (“PRJN2”), ECF No. 20. 3 Defendants request judicial notice of twelve documents in 4 support of their cross-motion for summary judgment. See Defs.’ 5 Request for Judicial Notice of Exhibits 1-12 (“DRJN”), ECF 6 No. 16-2. 7 All of the above exhibits are matters of public record and 8 therefore proper subjects for judicial notice. See Lee v. City 9 of Los Angeles, 250 F.3d 668, 689 (9th Cir. 2001). Accordingly, 10 the Court GRANTS Plaintiffs’ request for judicial notice of 11 Exhibits 1-7. The Court also GRANTS Defendants’ request for 12 judicial notice of Exhibits 1-12. The Court’s judicial notice, 13 however, extends only to the existence of these documents and 14 not to their substance to the extent it is disputed or 15 irrelevant. Lee, 250, F.3d at 690. 16 B. Analysis 17 The State contends that Plaintiffs’ action is moot and that 18 the Court therefore lacks subject matter jurisdiction over this 19 case. Cross-MSJ at 10. Because federal subject matter 20 jurisdiction concerns the Court’s power to declare the law, 21 “when it ceases to exist, the only function remaining to the 22 court is that of announcing the fact and dismissing the cause.” 23 Ex parte McCardle, 74 U.S. 506, 514 (1869). As such, the Court 24 must affirm its jurisdiction before proceeding to the merits of 25 summary judgment. See Steel Co. v. Citizens for a Better Env’t, 26 523 U.S. 83, 94 (1998) (requiring that “jurisdiction be 27 established as a threshold matter”). 28 /// 1 1. Mootness 2 The threshold question before the Court is whether this 3 case is moot. “A case becomes moot—and therefore no longer a 4 ‘Case’ or ‘Controversy’ for purposes of Article III—when the 5 issues presented are no longer ‘live’ or the parties lack a 6 legally cognizable interest in the outcome.” Rosebrock v. 7 Mathis, 745 F.3d 963, 971 (9th Cir. 2014) (internal citations 8 omitted). The party asserting mootness bears the “heavy burden” 9 to show that “the challenged conduct cannot reasonably be 10 expected to reoccur.” Id. 11 The parties do not dispute that the challenged action—the 12 State’s restrictions on unlawful detainer actions for nonpayment 13 of rent—ceased on June 30, 2022 with the expiration of AB 2179. 14 See Pls.’ Opp’n at 7; Cross-MSJ at 9. As such, “[t]he actual 15 controversy has evaporated,” because “there is no longer any 16 state order for the court to declare unconstitutional or to 17 enjoin. It could not be clearer that this case is moot.” Brach 18 v. Newsom, 38 F.4th 6, 11 (2022), citing Already, LLC. V. Nike, 19 Inc., 568 U.S. 85, 91 (2013). 20 The remaining inquiry for the Court, therefore, is whether 21 Plaintiffs’ claims remain live under an exception to mootness. 22 Plaintiffs contend that the Court should find their claims 23 remain live under the voluntary cessation exception and the 24 capable of repetition yet evading review exception. Pls.’ Opp’n 25 at 7-10. For the reasons given below, the Court disagrees. 26 2. Voluntary Cessation Exception 27 “[A] defendant cannot automatically moot a case simply by 28 ending its unlawful conduct once sued.” Already, 568 U.S. at 1 91. As the Supreme Court instructed, a party “should not be 2 able to evade judicial review, or to defeat a judgment, by 3 temporarily altering questionable behavior.” City News & 4 Novelty, Inc. v. City of Waukesha, 531 U.S. 278, 284 n.1 (2001). 5 The party asserting mootness must show that “the challenged 6 behavior cannot reasonably be expected to recur.” Already, 568 7 U.S. at 96. While the Court may “treat the voluntary cessation 8 of challenged conduct by government officials with more 9 solicitude . . . than similar actions by private parties,” the 10 Court must still diligently “probe the record to determine 11 whether the government has met its burden, even as [the Court 12 grants] it a presumption of good faith.” Bell v. City of Boise, 13 709 F.3d 890, 898-99, n.13, (9th Cir. 2013); Rosebrock v. 14 Mathis, 745 F.3d 963, 971-72 (9th Cir. 2014). Once the 15 government has met its burden, it is the opposing party’s burden 16 to show there is a “reasonable expectation of reenactment” that 17 defeats the presumption of mootness. Bd. of Trs. of Glazing 18 Health & Welfare Trust v. Chambers, 941 F.3d 1195, 1199 (9th 19 Cir. 2019) (en banc). A reasonable expectation must be “founded 20 in the record [and not] on speculation alone.” Id. 21 The Court finds that the State has met its burden to prove 22 upon the record that the challenged action cannot reasonably be 23 expected to recur. First, as the Ninth Circuit noted, “the 24 repeal, amendment, or expiration of challenged legislation is 25 generally enough to render a case moot and appropriate for 26 dismissal.” Id. at 1198. The record shows that AB 2179’s 27 expiration breaks with the State’s previous pattern of behavior: 28 When AB 3088’s restrictions on unlawful detainers would have 1 expired on January 31, 2021, the State extended it with SB 91; 2 when SB 91 would have expired on June 30, 2021, the State 3 extended it with AB 832; and when AB 832 would have expired on 4 March 31, 2022, the State extended it with AB 2179. On and on 5 in an unbroken train, the State renewed its restrictions on 6 unlawful detainers against tenants for nonpayment of rent. That 7 the State allowed AB 2179 to expire on June 30, 2022 suggests, 8 therefore, that it is unlikely to renew similar restrictions in 9 the future. 10 Further, the record shows that the State’s approach to 11 unlawful detainers has been “steady and consistent” in its 12 gradual tapering. Brach, 38 F.4th at 15. At the start of the 13 pandemic, tenants with qualifying COVID-19 hardships could not 14 be evicted by unlawful detainer for nonpayment of rent between 15 March 1, and August 31, 2020. §§ 1179.02(f), 1179.03(b). This 16 protection lasted until October 1, 2021, from which point 17 forward landlords could seek unlawful detainers for all future 18 failures to pay rent. §§ 1179.03(g), 1179.03.5. Landlords 19 could also evict tenants who failed to pay at least 25 percent 20 of past rent due between September 1, 2020 and September 30, 21 2021. §§ 1179.02(i), 1179.03(g). The State continued to roll 22 back its restrictions when it passed AB 2179, which limited the 23 bar on unlawful detainers to tenants who had applied for rental 24 assistance by March 30, 2022. § 1179.03(c)(7). 25 As Defendants point out, even during the Omicron variant 26 surge, when the State’s COVID-19 case count exceeded what it was 27 early in the pandemic, the State did not reimpose a full-out 28 moratorium on evictions. Cross-MSJ at 12; See Brach, 38 F.34th 1 at 14 (finding a case moot where the State “maintained in-person 2 instruction throughout the surge of the Omicron COVID-19 3 variant, even while the State’s case count soared”). As such, 4 it is apparent that, with each bill passed, the State gradually 5 rescinded its restrictions on unlawful detainers until all 6 restrictions were finally lifted on June 30, 2022. Defs.’ Reply 7 at 4-5. Accordingly, the Court finds that the State has carried 8 its burden to show that there is no reasonable expectation of 9 reenactment. 10 As the party seeking to rebut the presumption of mootness, 11 Plaintiffs must show there is a reasonable expectation that the 12 State will reoffend. Bd. of Trs. of Glazing Health & Welfare 13 Trust, 941 F.3d at 1199. Plaintiffs point to the fact that 14 “[t]he State has not committed itself to never re-impose such a 15 moratorium again [and] the State refuses to acknowledge the harm 16 that its moratorium has caused rental housing owners.” Reply 8- 17 9, citing Brach, 38 F.4th at 15 (“Most importantly, the State 18 has ‘unequivocally renounce[d]’ the use of school closure orders 19 in the future”). Plaintiffs read too much into Brach. Although 20 the Ninth Circuit found it compelling that the State 21 “renounce[d] its use of school closure orders in the future,” 22 the court did not require an explicit renouncement for its 23 analysis. The renouncement was significant only because it 24 demonstrated the State’s “commitment” to keeping schools open. 25 Id. As such, where the State shows through other means that it 26 is committed to quitting the challenged conduct, the State does 27 need an explicit announcement denouncing its previous conduct. 28 /// 1 Plaintiffs next argue that their claims remain live because 2 Governor Newsom’s declaration of a State of Emergency is still 3 in force. Pls.’s Reply at 9. However, given that this fact was 4 immaterial in Brach, the Court declines to afford it weight 5 here. See Brach 38 F.4th at 9 (acknowledging the State of 6 Emergency but not discussing it); contra, Id. at 16 (dissent 7 opinion) (discussing the relevance of the ongoing State of 8 Emergency). 9 Plaintiffs also argue that their claims remain live because 10 the pandemic “is far from over,” and that the State has both the 11 power and incentive to reimpose an eviction moratorium in the 12 future. Pls.’ Reply at 9. Plaintiffs’ argument fails because a 13 “[r]easonable expectation means something more than ‘a mere 14 physical or theoretical possibility.’” Brach quoting Murphy v. 15 Hunt, 455 U.S. 478, 482 (1982). As the Brach court explained, 16 the power to reenact a challenged policy is not a sufficient 17 basis for a court to conclude that a reasonable expectation of 18 recurrence exists. “Rather, there must be evidence indicating 19 that the challenged [policy] likely will be reenacted.” Brach 20 quoting Larsen v. U.S. Navy, 525 F.3d 1, 4 (D.C. Cir. 2008). In 21 the absence of a showing upon the record that there is a 22 reasonable expectation that the challenged conduct will reoccur, 23 the Court concludes the voluntary cessation exception does not 24 apply. 25 3. Capable of Repetition yet Evading Review 26 The Court also finds the capable of repetition yet evading 27 review exception does not apply. This exception applies only in 28 extraordinary cases where “(1) the duration of the challenged 1 action is too short to allow full litigation before it ceases, 2 and (2) there is a reasonable expectation that the plaintiffs 3 will be subjected to it again.” Alaska Ctr. For Evn’t v. U.S. 4 Forest Serv., 189 F.3d 851, 854-55 (9th Cir. 1999). 5 Plaintiffs argue their case is live under the capable of 6 repetition yet evading review exception because the duration of 7 the challenged action was too short to allow full litigation 8 before it ceases—“[e]ach moratorium extension lasted months and 9 easily evaded judicial review, allowing it to expire well before 10 a court could pass on its constitutionality.” Pls.’ Opp’n at 9. 11 The Court observes that while each moratorium extension lasted 12 only months, the extensions were consecutive such that the 13 moratorium effectively lasted from August 31, 2020 to October 1, 14 2021, and, in a more limited capacity, from October 1, 2021 15 through June 30, 2022. As Defendants point out, “[t]hat this 16 case did not resolve prior to the moratorium expiring on 17 October 1, 2021 is due entirely to Plaintiffs’ decisions to wait 18 more than a year to file their case.” Defs.’ Reply at 5. 19 Even if the moratorium were too short to allow full 20 litigation, Plaintiffs would not prevail on the second prong of 21 the capable of repetition analysis. As the Brach Court 22 instructed, the voluntary cessation and capable of repetition 23 exception are “analogous” to one another. Brach, 38 F.4th 24 at 15. Just as the Brach court’s “rationale for rejecting [the 25 capable of repetition exception] mirrors much of [its] analysis 26 regarding the voluntary cessation exception,” so too does this 27 Court’s present analysis mirror the one above. Id. Because the 28 challenged moratorium has already expired and because the public 1 health landscape is drastically different from the start of the 2 pandemic, there is no reasonable expectation that Plaintiffs 3 will be subjected to the challenged conduct again. The 4 “reasonable expectation” prong of the Court’s analysis has not 5 been met. Alaska Ctr. For Evn’t, 189 F.3d at 854-55. As such, 6 the Court finds the capable of repetition yet evading review 7 exception does not apply. 8 4. Nominal Damages 9 The Court is unpersuaded by Plaintiffs’ contention that 10 their prayer for nominal damages saves this action from 11 mootness. MSJ at 16, citing Bernhardt v. County of Los Angeles, 12 279 F.3d 862, 872 (9th Cir. 2002) (“A live claim for nominal 13 damages will prevent dismissal for mootness”). In this case, 14 Plaintiffs have only requested nominal damages against State 15 Defendants who have been sued in their official capacities. See 16 FAC. The Eleventh Amendment bars such claims. See Kentucky v. 17 Graham, 473 U.S. 159, 169-70 (1985) (holding that the Eleventh 18 Amendment immunizes state officials sued in their official 19 capacity from claims for retrospective relief, including 20 monetary damage claims.) Accordingly, the Court finds that 21 Plaintiffs’ contention regarding nominal damages is without 22 merit. There being no viable damages claim to rescue 23 Plaintiffs’ case, this case is moot. 24 25 III. ORDER 26 For the reasons set forth above, the Court DISMISSES 27 Plaintiffs’ Complaint in its entirety for lack of subject matter 28 jurisdiction. The Court further DENIES Plaintiff’s motion for em REI ON IERIE III EEO IEE SNE SIS EE DS Oe eee 1 summary judgment and Defendants’ cross-motion for summary 2 judgment as MOOT. The Clerk of the Court is directed to CLOSE 3 this case. 4 IT IS SO ORDERED. 5 Dated: October 11, 2022 6 : APs JOHN A. MENDEZ 8 SENIOR UNITED*STATES DISTRICT JUDGE 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 12