Tranchmontagne v. U.S. Dep't of Hous. & Urban Dev.

Decision Date29 June 2021
Docket NumberCase No. 20-cv-12842
PartiesDEANNA TRANCHMONTAGNE, Plaintiff, v. UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT, MICHIGAN STATE HOUSING DEVELOPMENT AUTHORITY, and GARY HEIDEL, Acting Director, Defendants.
CourtU.S. District Court — Eastern District of Michigan

Paul D. Borman United States District Judge

OPINION AND ORDER: (1) GRANTING DEFENDANTS GARY HEIDEL AND MSHDA'S MOTION TO DISMISS UNDER FED. R. CIV. P. 12(b)(1) & (6) (ECF NO. 13); (2) GRANTING DEFENDANT UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT'S MOTION TO DISMISS UNDER FED. R. CIV. P. 12(b)(1) & (6) (ECF NO. 16); (3) DENYING PLAINTIFF DEANNA TRANCHMONTAGNE'S MOTION FOR A VERBAL RESPONSE (ECF NO. 18); AND (40 DENYING PLAINTIFF'S MOTION FOR INJUNCTION (ECF NO. 8)

Plaintiff, Deanna Tranchmontagne, proceeding pro se, brings this lawsuit against Defendants, the United States Department of Housing and Urban Development ("HUD"), the Michigan State Housing Development Authority ("MSHDA"), and Gary Heidel, as acting Director of MSHDA, challenging the termination of her Section 8 housing choice voucher. Plaintiff alleges that termination of her subsidized housing payments violates the federal Fair Housing Act, the Americans with Disabilities Act, the Rehabilitation Act, and the Constitution's equal protection and due process protections. She further claims that she has been deprived of her rights under 42 U.S.C. § 1983, and asserts a breach of contract claim. Plaintiff seeks an injunction to prevent her eviction and denial of Section 8 housing, a full and fair hearing, that the findings of the administrative law judge be set aside, and that monetary damages be awarded.

Now before the Court are Plaintiff's Motion for Preliminary Injunction (ECF No. 8), Defendants Heidel and MSHDA's Motion to Dismiss Under Fed. R. Civ. P. 12(b)(1) & (6) (ECF No. 13), Defendant HUD's Motion to Dismiss (ECF No. 16), and Plaintiff's Motion for a Verbal Response to Defendants' motions to dismiss (ECF No. 19).

The Court does not believe oral argument will aid in its disposition of the motions; therefore, it is dispensing with oral argument pursuant to Eastern District of Michigan Local Rule 7.1(f)(2). For the reasons set forth below, the Court DENIES Plaintiff's motion for preliminary injunction, DENIES Plaintiff's motion for verbal response to Defendants' motions to dismiss, GRANTS Defendants Heidel and MSHDA's motion to dismiss, and GRANTS Defendant HUD's motion to dismiss.

I. FACTUAL AND PROCEDURAL BACKGROUND
A. The Federally Subsidized Housing Choice Voucher Program

The Housing Choice Voucher Program ("HCV Program"), or Section 8 housing program, is the federal government's program for assisting low-income families to afford housing. See 42 U.S.C. § 1437f; 24 C.F.R. § 982.1(a)(1). The program is administered by state or local public housing agencies ("PHAs"), which receive federal funding from HUD. Id. Families select and rent units that meet program standards, and the PHA makes rent subsidy payments directly on behalf of the family. 24 C.F.R. § 982.1(a)(2).

Although HUD provides funding for the Section 8 program, the PHA is responsible for administering it. See id. §§ 982.1-982.643. For example, the PHA admits families for participation in the program, id. § 982.202, issues housing vouchers to families, id. § 982.302, and makes rent payments, id. § 982.451. The PHA also has the authority to terminate rental assistance under the program. Id. § 982.552. The Michigan State Housing Development Authority ("MSHDA") is the PHA/state agency that uses federal funds to administer the Section 8 program in Michigan. MCL § 125.1422(c), (t).

Under the HCV Program in Michigan, a prospective tenant applies for a housing voucher from MSHDA. If a voucher is issued, the tenant finds a suitable place to live. 24 C.F.R. § 982.302. MSHDA enters into a Housing AssistancePayment ("HAP") contract with the landlord. 24 C.F.R. § 982.451. The landlord enters into a lease with the tenant and MSHDA pays a portion of the tenant's rent directly to the landlord. 24 C.F.R. § 982.501 et. seq.; see also generally 42 U.S.C. § 1437f and 24 C.F.R. § 982.1, et seq.; 24 C.F.R. §§ 883.101-883.608; Mich. Comp. Laws § 125.1422(t).

Under 24 C.F.R. § 982.308, landlords are required to provide tenants with an addendum to the lease agreement that sets forth MSHDA's authority and tenant and landlord responsibilities under the HCV Program, as found in the governing regulations. See e.g. 24 C.F.R. § 982.551. MSHDA's authority under the federal regulations includes authority to terminate HCV Program participation if the tenant violates his or her HCV Program obligations. 24 C.F.R. §§ 982.551-553.

B. Termination of Plaintiff's Program Participation

Plaintiff began participation in the HCV Program on June 1, 2017. (ECF No. 1, Complaint, PageID.1-2.) Plaintiff lives with her partner, Jerome Carleton, and their minor child. (Id. PageID.2.) Plaintiff suffers from a mental disability and drug and alcohol addiction. (Id.) Jerome Carleton had a leg amputation and suffers from drug addiction. (Id.) Their minor child is diagnosed with autism spectrum disorder. (Id.)

On June 3, 2019 (later amended on June 27, 2019), MSHDA notified Plaintiff that her participation in the HCV Program was terminated due to multiple violationsof the Program's rules, including two arrests (Plaintiff and Mr. Carleton each had one arrest). (Compl., PageID.4; ECF No. 13-2, Proposal for Decision at pp. 1-4, PageID.83-86.) Plaintiff requested an administrative hearing to object to the termination. (Proposal for Decision at p. 4, PageID.86.) The hearing was held on September 24, 2019 before Administrative Law Judge Peter L. Plummer. (Compl., PageID.5.) At the hearing, Plaintiff appeared with her representative, Chelsea Battin, and both testified. (Proposal for Decision at p. 4, PageID.86.) Plaintiff also introduced 88 pages of documents into the record at the hearing. (Id. at pp. 5-6, 18, PageID.87-88, 100.)

Following the hearing, the administrative law judge issued his proposal for decision dated December 9, 2019, concluding that Respondent MSHDA had proven by a preponderance of the evidence that Plaintiff: (1) failed to provide true and complete information to MSHDA; (2) failed to pay utilities in a timely fashion and used gifts and other contributions to pay the utilities without reporting that information to MSHDA; (3) committed a violent criminal activity when she tackled an employee of a car dealership; and, (4) that Mr. Carleton possessed cocaine, which is a criminal drug activity. (Id. at p. 19, PageID.101) The administrative law judge recommended that Plaintiff's termination from the HCV Program be affirmed. (Id. at p. 20, PageID.102) The Proposal for Decision provided that a party may file Exceptions to the Proposal. (Id.)

Plaintiff had filed an Exception to the Proposal for Decision on December 30, 2019, and MSHDA filed an Exception in response on January 9, 2020. (ECF No. 13-3, Final Decision and Order at pp. 1-2, PageID.108-09.) On June 1, 2020, MSHDA's Director of Legal Affairs, Clarence L. Stone, Jr., issued the Final Decision and Order ("FDO") and upheld Plaintiff's termination from the Program. (Id. at pp. 1-4, PageID.108-12.) That FDO further informed Plaintiff that she had 60 days to file an appeal of the FDO, and that she would not lose her HCV assistance until the Michigan state of emergency and state of disaster as described in Executive Orders issued by the Governor of Michigan as a result of COVID-19 had been lifted. (Id. at p. 4, PageID.111.)

C. Plaintiff's Complaint and Motion for Preliminary Injunction

Plaintiff brought this action on October 20, 2020. She claims that MSHDA terminated her voucher because of her disabilities and in retaliation for her prior accommodation requests, in violation of the Fair Housing Act, the Rehabilitation Act, and the ADA. (Compl., PageID.2-3.) She also alleges that the termination violated her constitutional due process and equal protection rights. (Id., PageID.4-7.) Plaintiff further asserts a breach of contract claim based upon a purported settlement she entered with MSHDA and HUD relating to her application for participation in the Section 8 program. (Id., PageID.8.) She alleges that MSHDA and HUD breached the agreement by seeking to exclude her from the Section 8 program.(Id.) Plaintiff requests an injunction "to prevent [her] eviction and denial of Section 8 Housing," a "full and fair hearing," that "[t]he findings made by the administrative law judge and the Director of MSHDA be set aside," and "[d]amages for breach of agreement and [her] rights under federal law." (Id., PageID.8-9.)

Plaintiff filed a motion for preliminary injunction on January 20, 2021, before Defendants had been served with the Complaint,1 seeking in part the same relief requested in her Complaint - an injunction "to prevent [her] eviction and denial of Section 8 Housing Benefits," pursuant to Fed. R. Civ. P. 65(a). (ECF No. 8, Motion for Preliminary Injunction.)

D. Defendants' Motions to Dismiss

Upon service (or notice) of Plaintiff's Complaint, the Defendants have filed motions to dismiss pursuant to Fed. R. Civ. P. 12(b)(1) and (6).

1. Defendants Heidel and MSHDA's Motion to Dismiss

On March 12, 2021, Defendants Heidel and MSHDA filed their motion to dismiss under Fed. R. Civ. P. 12(b)(1) & (6). (ECF No. 13, MSHDA Defs.' Mot.) The MDHSA Defendants assert that Plaintiff's claims are barred by the Eleventh Amendment. They further argue that Plaintiff's claims are subject to dismissal under Fed. R. Civ. P. 12(b)(6) for failure to state a claim.

On March 17, 2021 The Court issued an order notifying Plaintiff of her obligation to respond to the motion to dismiss and directing her to file a response to the MSHDA Defendants' motion to dismiss, if any, by April 6, 2021. (ECF No. 15, Order.) Plaintiff did not file a response.

2. Defendant HUD's Motion to Dismiss

On March 30, 2021, Defendan...

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