Fed. Hous. Fin. Agency v. City of Ansonia
| Decision Date | 14 July 2021 |
| Docket Number | No. 3:20-cv-01320 (MPS),3:20-cv-01320 (MPS) |
| Citation | 549 F.Supp.3d 242 |
| Parties | FEDERAL HOUSING FINANCE AGENCY, on its own behalf and in its capacity as Conservator for Federal National Mortgage Association; Federal National Mortgage Association, Plaintiffs, v. CITY OF ANSONIA; Ronda Porrini, in her official capacity as City Land Use Administrator; David Blackwell, Sr., in his official capacity as City Anti-Blight Officer; Arthur J. Davies, in his official capacity as Connecticut State Marshal, Defendants. |
| Court | U.S. District Court — District of Connecticut |
James A. Budinetz, McElroy, Deutsch, Mulvaney & Carpenter, LLP, Hartford, CT, for Plaintiff Federal Housing Finance Agency. +++++ Andrew L. Baldwin, Goldberg Segalla LLP, Hartford, CT, for Plaintiff Federal National Mortgage Association.
John Paul Marini, Marino, Zabel & Schellenberg, PLLC, Orange, CT, for Defendants.
Michael P. Shea, U.S.D.J. Plaintiffs Federal Housing Finance Agency ("FHFA"), on its own behalf and as Conservator for the Federal National Mortgage Association ("Fannie Mae"), and Fannie Mae bring this action for declaratory judgment, to quiet title, and for corresponding injunctive relief against the City of Ansonia, Connecticut (the "City"); Ronda Porrini, in her official capacity as City Land Use Administrator; David Blackwell, Sr., in his official capacity as City Anti-Blight Officer; and Arthur J. Davies, in his official capacity as Connecticut State Marshal. ECF No. 1. The plaintiffs have filed a motion for summary judgment. ECF No. 18. For the reasons set forth below, I GRANT that motion.
The following facts are taken from the plaintiffs’ Local Rule 56(a) Statement or are subject to judicial notice.1 The parties agree that this case presents a purely legal issue and neither party disputes any material fact in this case.
On September 6, 2008, FHFA placed Fannie Mae into a conservatorship and appointed itself as conservator. The purpose of the conservatorship is "reorganizing, rehabilitating or winding up [Fannie Mae's] affairs." 12 U.S.C. § 4617(a)(2). Fannie Mae remains in such conservatorship today. ECF No. 18-2 ¶ 1.
On April 27, 2007, Kevin D. Parham recorded a Warranty Deed in the public records of Ansonia, Connecticut, which transferred title in real property located at 66 Benz Street, Ansonia, Connecticut 06401 ("Property") to Mr. Parham. ECF No. 18-2 ¶ 2. An open-ended mortgage deed listing Kevin D. Parham as the borrower ("Borrower"), American Brokers Conduit as the lender ("Lender"), and Mortgage Electronic Registration Systems, Inc. ("MERS"), as beneficiary solely as nominee for Lender and Lender's successors and assigns, was executed on April 25, 2007, and recorded on April 27, 2007 ("Deed of Trust"). The Deed of Trust granted Lender a security interest in the Property to secure the repayment of a loan in the original amount of $208,000 to the Borrower. Id. ¶ 3. On October 17, 2011, MERS recorded an assignment of the Deed of Trust to Wells Fargo Bank, N.A. ("Wells Fargo"). Id. ¶ 4. On June 3, 2019, Wells Fargo recorded a Certificate of Foreclosure stating that on May 7, 2019, "title to [the Property] became absolute in" Wells Fargo. Id. ¶ 5. Following Fannie Mae's purchase of the Property at a foreclosure sale, on May 31, 2019, Wells Fargo executed a Quit-Claim Deed that transferred title in the Property to Fannie Mae. Id. ¶ 6. On June 10, 2019, a Fannie Mae authorized agent recorded the Quit Claim Deed in the public records of the City of Ansonia. Id. ¶ 9.
On June 5, 2019, the City of Ansonia, acting through its Blight Enforcement Officer, David Blackwell, Sr., executed a "Blight Lien and Certification of Continuing Lien" ("Blight Lien") against the Property, which the City of Ansonia recorded on June 6, 2019 in its public records. Id. ¶ 7. The Blight Lien provides for a $100 per day charge for the first thirty days and a $250 per day charge thereafter as of May 8, 2019 and until the blighted condition of the Property is abated. Id. ¶ 8. On July 3, 2020, Connecticut State Marshal Arthur J. Davies sent an Alias Warrant to Fannie Mae, through its authorized agent, seeking to collect an anti-blight fine in the amount of $81,600, which reflects the total amount of the daily fees under the Blight Lien. Including a 15% Marshal Fee, the total fine amounted to $93,840. Id. ¶ 10. The Alias Warrant provides the following accounting for the anti-blight fine under the Blight Lien for a total fine of $81,600:2
Id. ¶ 11. The Alias Warrant states that the City of Ansonia had spent "$ 000" on "Remediation" of the Property. Id. ¶ 12.
"Summary judgment is appropriate only if the movant shows that there is no genuine issue as to any material fact and the movant is entitled to judgment as a matter of law." Tolan v. Cotton , 572 U.S. 650, 657-58, 134 S.Ct. 1861, 188 L.Ed.2d 895 (2014) (internal quotation marks and citations omitted). In reviewing the summary judgment record, a court must "construe the facts in the light most favorable to the nonmoving party and must resolve all ambiguities and draw all reasonable inferences against the movant." Caronia v. Philip Morris USA, Inc. , 715 F.3d 417, 427 (2d Cir. 2013). "A genuine dispute of material fact exists for summary judgment purposes where the evidence, viewed in the light most favorable to the nonmoving party, is such that a reasonable jury could decide in that party's favor." Zann Kwan v. Andalex Grp. LLC , 737 F.3d 834, 843 (2d Cir. 2013). The moving party bears the burden of demonstrating that no genuine issue exists as to any material fact. Celotex Corp. v. Catrett , 477 U.S. 317, 323-25, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). If the moving party carries its burden, "the opposing party must come forward with specific evidence demonstrating the existence of a genuine dispute of material fact." Brown v. Eli Lilly & Co. , 654 F.3d 347, 358 (2d Cir. 2011) (citing Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ). As noted above, neither side here contends that there is a genuine dispute of material fact.
The only issue presented by this summary judgment motion is whether the Federal Housing and Economic Recovery Act of 2008 ("HERA"), 12 U.S.C. § 4511 et seq., preempts the City of Ansonia's anti-blight penalties and liens, which are authorized by Connecticut statutes.3 See Conn. Gen. Stat. § 7-148(c)(7)(H)(xv) (); id. § 7-148aa (); Ansonia Code art. III, §§ 13-46 to 13-53.1 ("Anti-Blight Program"); id. § 13-50(a)-(b), (f) ().
The plaintiffs have moved for summary judgment, arguing that the Connecticut laws under which the defendants imposed monetary penalties on the plaintiffs and attached a lien on the Property to secure payment conflict with, and thus are preempted by, the provisions of HERA that protect FHFA from liens and penalties. ECF No. 18. The defendants respond by arguing that (1) HERA does not expressly or impliedly preempt the City of Ansonia's ability to impose and enforce blight fees and blight liens; and (2) the federal pre-emption of local land-use laws sought by the plaintiffs is contrary to congressional intent, public policy, and a plain reading of HERA. ECF No. 26. For the reasons set forth below, I agree with the plaintiffs and grant the motion for summary judgment.
"The Supremacy Clause unambiguously provides that if there is any conflict between federal and state law, federal law shall prevail." Gonzales v. Raich , 545 U.S. 1, 29, 125 S.Ct. 2195, 162 L.Ed.2d 1 (2005). This is so even if the federal statutory language does not explicitly manifest Congress's preemptive intent. See Altria Grp., Inc. v. Good , 555 U.S. 70, 76-77, 129 S.Ct. 538, 172 L.Ed.2d 398 (2008). "[C]onflict pre-emption exists where compliance with both state and federal law is impossible, or where the state law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress." Oneok, Inc. v. Learjet, Inc. , 575 U.S. 373, 377, 135 S.Ct. 1591, 191 L.Ed.2d 511 (2015) (internal quotation marks omitted).
In deference to the police powers of the states, courts often apply a presumption against federal preemption. Cipollone v. Liggett Grp., Inc. , 505 U.S. 504, 516, 112 S.Ct. 2608, 120 L.Ed.2d 407 (1992) () (emphasis added; internal citation and quotation marks omitted; alterations in original); see also California v. ARC Am. Corp. , 490 U.S. 93, 101, 109 S.Ct. 1661, 104 L.Ed.2d 86 (1989) (). The presumption is "particularly strong where ... a state or locality seeks to exercise its police powers to protect the health and safety of its citizens." U.S. Smokeless Tobacco Mfg. Co. LLC v. City of New York , 708 F.3d 428, 432 (2d Cir. 2013). In this case, for the reasons discussed below, I find that HERA demonstrates a clear and manifest intent to preempt the anti-blight penalties and blight lien at issue. As a result, I need not decide whether the presumption against preemption applies to state or municipal anti-blight programs.
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