Tiger Lily, LLC v. U.S. Dep't of Hous. & Urban Dev.

• Decision Date: 15 March 2021
• Docket Number: No: 2:20-cv-02692-MSN-atc,: 2:20-cv-02692-MSN-atc
• Citation: 525 F.Supp.3d 850
• Parties: TIGER LILY, LLC; Hunter Oaks Apartments Utah, LLC; North 22nd Flat, LLC; Cherry Hill Gardens, LLC ; Churchill Townhomes, LLC ; Brittany Railey; and Applewood Property Management, LLC, Plaintiffs, v. UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT and Benjamin S. Carson, M.D., in his official capacity as United States Secretary of Housing and Urban Development ; United States Department of Justice and William P. Barr, in his official capacity as United States Attorney General; United States Center for Disease Control and Prevention and Nina B. Witkovsky, in her official capacity as Acting Chief of Staff of the Center for Disease Control and Prevention; United States Department of Health & Human Services and Alex Azar, in his official capacity as United States Secretary of Health and Human Services; Vice Admiral Jerome M. Adams, M.D., in his official capacity as United States Surgeon General; and D. Michael Dunavant, in his official capacity as United States Attorney General for the Western District of Tennessee, Defendants.
• Court: U.S. District Court — Western District of Tennessee

525 F.Supp.3d 850

TIGER LILY, LLC; Hunter Oaks Apartments Utah, LLC; North 22nd Flat, LLC; Cherry Hill Gardens, LLC ; Churchill Townhomes, LLC ; Brittany Railey; and Applewood Property Management, LLC, Plaintiffs,

v.UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT and Benjamin S. Carson, M.D., in his official capacity as United States Secretary of Housing and Urban Development ; United States Department of Justice and William P. Barr, in his official capacity as United States Attorney General; United States Center for Disease Control and Prevention and Nina B. Witkovsky, in her official capacity as Acting Chief of Staff of the Center for Disease Control and Prevention; United States Department of Health & Human Services and Alex Azar, in his official capacity as United States Secretary of Health and Human Services; Vice Admiral Jerome M. Adams, M.D., in his official capacity as United States Surgeon General; and D. Michael Dunavant, in his official capacity as United States Attorney General for the Western District of Tennessee, Defendants.

No: 2:20-cv-02692-MSN-atc

United States District Court, W.D. Tennessee, Western Division.

Signed March 15, 2021

Aubrey Brode Greer, S. Joshua Kahane, Glankler Brown, PLLC, Memphis, TN, for Plaintiffs.

Leslie Cooper Vigen, DOJ, Washington, DC, Audrey M. Calkins, Stuart J. Canale, U.S. Attorney's Office Western District of Tennessee, Memphis, TN, for Defendant United States Department of Housing and Urban Development.

Leslie Cooper Vigen, DOJ, Washington, DC, Audrey M. Calkins, U.S. Attorney's Office Western District of Tennessee, Memphis, TN, for Defendants Benjamin S. Carson, M.D., United States Department of Justice, William P. Barr, United States Center for Disease Control and Prevention, Nina B. Witkovsky, United States Department of Health & Human Services, Alex Azar, Vice Admiral Jerome M. Adams, M.D., D. Michael Dunavant.

ORDER GRANTING PLAINTIFFS' MOTION FOR JUDGMENT ON THE ADMINISTRATIVE RECORD AND ORDER DENYING DEFENDANTS' MOTION FOR JUDGMENT ON THE PLEADINGS

MARK S. NORRIS, UNITED STATES DISTRICT JUDGE

This cause comes before the Court on Plaintiffs' Motion for Judgment on the Administrative Record (ECF No. 84) and Defendants' Motion for Judgment on the Pleadings. (ECF No. 82). The parties filed their respective responses on January 15, 2021.¹ (ECF Nos. 87, 88.) The parties then filed their replies on January 29, 2021. (ECF Nos. 91, 92.) For the reasons below, the Court GRANTS Plaintiffs' Motion and DENIES Defendants' Motion.

FACTUAL BACKGROUND

On March 11, 2020, the World Health Organization declared COVID-19 a global pandemic. The next day, Tennessee Governor Bill Lee issued Executive Order No. 14 declaring a State of Emergency in response to the COVID-19 outbreak. Then-President Trump declared a national emergency for COVID-19 on March 13, 2020.

On March 27, 2020, then-President Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"). Coronavirus Aid, Relief, and Economic Security Act, Pub. L. 116-136, 134 Stat. 281 (2020). Sections 4022 and 4023 of the CARES Act protected those with federally backed mortgages from foreclosures until at least August 31, 2020 and allowed for a mortgage forbearance for up to 180 days. Section 4024(b) provided for a 120-day eviction moratorium for rental units in properties that participated in federal assistance programs or had a federally backed mortgage or multifamily loan. Congress did not renew the CARES Act protections for homeowners or renters upon their expiration.

On August 8, 2020, then-President Trump issued an executive order directing the Secretary of Health and Human Services and the Director of the Centers for Disease Control and Prevention (the "CDC") to "consider whether any measures temporarily halting residential evictions for any tenants for failure to pay rent [were] reasonably necessary to prevent the further spread of COVID-19 from one State or possession into any other State or possession." Less than a month later, on September 4, 2020, the CDC issued the " Temporary Halt in Residential Evictions to Prevent the Further Spread of COVID-19" (the "Halt Order"). 85 Fed. Reg. 55,292 (Sept. 4, 2020).

The Halt Order imposes a moratorium on evictions of certain tenants under residential leases, "subject to further extension, modification, or rescission."

Id. at 55,296. To qualify for protection under the Halt Order, a tenant must submit a declaration under penalty of perjury affirming that the tenant:

(1) has used best efforts to obtain government assistance to make rental payments;

(2) expects to earn less than $99,000 in annual income in 2020, was not required to pay income taxes in 2019, or qualified for a stimulus check under the CARES Act;

(3) is unable to pay full rent due to substantial loss of household income, loss of compensable hours of work or wages, lay-offs, or extraordinary out-of-pocket medical expenses;

(4) is using best efforts to make partial payments;

(5) would likely experience homelessness or need to move into a shared residence if evicted;

(6) understands that rent obligations still apply; and

(7) understands that the moratorium was to end on December 31, 2020.

Id. at 55,297.

The Halt Order provides extensive background on COVID-19 and its historic threat to public health. The Halt Order notes that "[t]he virus that causes COVID-19 spreads very easily between people who are in close contact with one another (within about 6 feet), mainly through respiratory droplets produced when an infected person coughs

, sneezes, or talks." Id. at 55,293. In light of this, the Halt Order makes specific findings about the use and effectiveness of eviction moratoria in the context of a pandemic, providing that such moratoria "facilitate self-isolation by people who become ill or who are at risk for severe illness from COVID-19 due to an underlying medical condition." Id. at 55,294. Further, eviction moratoria "allow State and local authorities to more easily implement stay-at-home and social distancing directives to mitigate the community spread of COVID-19," while also facilitating "housing stability [that] helps protect public health because homelessness increases the likelihood of individuals moving into close quarters in congregate settings, such as homeless shelters, which then puts individuals at higher risk to COVID-19." Id.

While the Halt Order prohibits evictions at the national level, it contains several exceptions. It provides that it "does not apply in any State, local, territorial, or tribal area with a moratorium on residential evictions that provides the same or greater level of public-health protection" as the Halt Order's requirements. Id. It does not relieve any individual of the obligation to pay rent, and nothing in the Halt Order prevents landlords from charging or collecting fees, penalties, or interest as a result of a failure to pay rent. Id. The Halt Order also does not preclude evictions based on a tenant, lessee, or resident: (1) engaging in criminal activity while on the premises; (2) threatening the health or safety of other residents; (3) damaging property; (4) violating any applicable building code or other similar regulations as to health and safety; or (5) violating any other contractual obligation other than the timely payment of rent. Id.

The Halt Order imposes criminal penalties for those that violate its provisions: Individuals could be subject to a fine of up to $250,000, one year in jail, or both, while organizations could be subject to a fine of up to $500,000. Id. at 55,296.

The Halt Order was originally set to expire on December 31, 2020. However, prior to its expiration, Congress passed the Consolidated Appropriations Act, 2021 (the "CAA"), which extended the Halt Order an additional month until January 31, 2021. H.R. 133, 116th Cong., div. N, tit, V, § 502. Additionally, the CAA allocated $25 billion to states to aid individuals behind on rent. H.R. 133, 116th Cong., div. N, tit, V, § 501.

On January 20, 2021, Joseph R. Biden Jr. was sworn in as President of the United States. Upon taking office, President Biden asked the CDC to consider extending the Halt Order until March 31, 2021. Fact Sheet: President-elect Biden's Day One Executive Actions Deliver Relief for Families Across America Amid Converging Crises , THE WHITE HOUSE (Jan. 20, 2021), https://www.whitehouse.gov/briefing-room/statements-releases/2021/01/20/fact-sheet-president-elect-bidens-day-one-executive-actions-deliver-relief-for-families-across-america-amid-converging-crises/. On January 29, 2021, the Director of the CDC signed an order extending and superseding the original Halt Order. (ECF No. 93-1 at PageID 2590–603.) As it stands, the Halt Order, as extended and superseded by the CDC's January 29th order, is in place until March 31, 2021, unless further extended, modified, or rescinded. (ECF No. 93-1 at PageID 2603.)

PROCEDURAL BACKGROUND

Plaintiffs in this matter are a group of business organizations and individuals who own and/or manage residential real property in the form of multi-family apartment complexes, duplexes, townhomes, and single-family residences located within the Western District of Tennessee. (ECF No. 21 at PageID 195, 199–200.) On September 16, 2020, Plaintiffs filed their Complaint for Declaratory Judgment and Injunctive Relief, (ECF No. 1), seeking a declaratory judgment that the Halt Order violates the Constitution and for injunctive relief to prevent Defendants from enforcing the Halt Order. On September 27, 2020, Plaintiffs filed a Motion and Application for Emergency Hearing and Preliminary Injunction. (ECF No. 12.) On October 8, 2020, Plaintiffs filed an Amended Complaint, which presents an additional claim but seeks the same relief set forth in their original Complaint. (See ECF No. 21.)

On November 6, 2020, this Court issued an Order denying Plaintiffs' Motion for Preliminary Injunction. (ECF No. 69.) In the Order, this Court found that it...