The term “Long COVID” describes COVID-19 cases that continue to cause health impacts far after the initial infection. A similar term may need to be coined to describe litigation over actions by the government during the pandemic that will continue long after the emergency is over.
A federal magistrate judge heard arguments Thursday in one such case.
After Gov. Gavin Newsom declared a state of emergency in March 2020, Alameda County and the city of Oakland enacted moratorium ordinances barring landlords from evicting tenants who failed to pay rent during the COVID emergency. The ordinances did not invalidate or eliminate the tenants’ obligation to pay accrued rent, but prevented eviction for failure to pay.
The ordinances were temporary and expired when the emergency was declared over in July 2023 (Oakland) and April 2023 (Alameda County). In Oakland, the moratorium was replaced by a so-called “phase-out” ordinance that barred Oakland landlords from eviction for debt that accrued during the pandemic “because of a substantial reduction in household income or substantial increase in expenses” resulting from the pandemic.
In March 2022, a number of landlords challenged the ordinances as amounting to a government “taking” of their property without just compensation. They argued that the rent lost during the pandemic — allegedly millions of dollars — could never be recovered and that it was not the landlords’ responsibility to pay for a social policy decided upon and unilaterally imposed by the government.
On July 18, 2022, the landlords asked U.S. Magistrate Judge Laurel Beeler to grant “summary judgment” in their favor because, in their view, the facts and law were both so clear that there was no need for trial.
Beeler disagreed.
Landlords denied in court
On Nov. 22, 2022, the judge rejected the landlords’ motion, holding that the ordinances at issue did not completely “take” the landlords’ property. She pointed out the ordinances were temporary and the landlords were not denied rent forever; they were simply denied the right to use the remedy of evicting a tenant for non-payment.
Under those circumstances, she found that the deprivation suffered by the landlords didn’t cause such a severe impact as to amount to a taking under the prior cases decided by the U.S. Supreme Court and the U.S. Court of Appeals for the 9th Circuit.
Following her ruling, the landlords amended their initial complaint and also added another 52 landlords to the suit, all raising the same or similar arguments. The amended complaint also added a challenge to Oakland’s phase-out ordinance.
The judge noted that rent moratoriums were temporary and the landlords were not denied rent forever; only the right to evict a tenant for non-payment.
The city and county moved to dismiss the lawsuit, arguing that it failed to set out a valid claim for relief.
Matthew Zinn, arguing for the county at a hearing in San Francisco on Thursday, asserted that a landlord wishing to show a regulatory taking of its property needed to show a severe loss in the value of a property as a result of the regulation. He contended that unless the loss exceeded 50 percent of the property’s value, it was unlikely to constitute a taking. He pointed out that while the landlords said they lost rental income, they did not show that it caused a severe diminution in the value of their properties.
Judge Beeler did not rule at the hearing, but she appeared skeptical that the landlords’ claim was any better than when she decided the summary judgment. While she repeatedly said the landlords’ taking argument was “interesting” and once she said it was very “close,” she appeared troubled that landlords had not shown that the temporary moratorium caused the type of severe loss of value needed to prove a taking.
Renters rally
A small rally outside the courthouse before the hearing featured speakers from the Alliance of Californians for Community Empowerment Action who talked about the importance of the moratorium ordinances for renters in the East Bay. ACCE joined in the case as an “intervener” in support of the city and county positions.
Leah Simon-Weisberg, executive director of California Center for Movement Legal Services, a legal services group representing ACCE in the case, said there would be “disastrous” consequences if the landlords were to prevail in their challenges to the ordinances.
As the rally broke up, the group chanted, “Fight, fight, fight, fight. Housing is a human right.” In literature that ACCE distributed about the lawsuit, it cited information from a website maintained by ProPublica that shows that during the pandemic, two companies allegedly controlled by one of the plaintiff landlords had received more than $800,000 in forgiven Paycheck Protection Program loans from the government.
The implication was that it came with ill grace for a landlord who received government support during the pandemic to argue that financial support could not also be provided to tenants, many of whom are low-income.
A ruling against the landlords is not likely to end the matter any time soon. Judge Beeler said that if she dismisses the case, she is inclined to allow the plaintiffs to further amend their complaint. And, in any event, the landlords have previously expressed their intent to appeal an adverse ruling.