Facts

The California Rental Housing Association (CRHA) is an association of over 19,000+ rental housing owners, as well as individual landlords. On August 31, 2020, in response to the COVID-19 pandemic, Governor Newsom signed Assembly Bill (AB) 3088 into law as a means to protect residents who failed to pay rent due to the pandemic. It allows renters who submit a COVID declaration and pay 25% of their rent to stay in their unit. On June 2021, the Governor signed AB 832, which extended the eviction moratorium for an additional three months. CRHA sued Gavin Newsom in his official capacity as the governor of California and Rob Bonta in his official capacity as the Attorney General of California for enacting AB 832, alleging violations of the Due Process Clause, Takings Clause, and Contracts Clause.

PLAINTIFFS' CONTENTIONS: Plaintiffs alleged that AB 832 transferred the fundamental right to exclude from owners to nonpaying tenants and eliminated the owners' right to make economically beneficial and productive use of their rental properties by indefinitely depriving owners of their only legal remedy to have a guaranteed reasonable return on their investment. Thus, plaintiffs contended that AB 832 effected a per se and categorical regulatory taking of rental housing owners' properties under the Fifth Amendment by granting tenants near-unqualified access to and use of the properties, as well as the right to exclude owners. Additionally, plaintiffs maintained that the taking was not for a public use or purpose and was done to benefit a particular class of identifiable individuals, tenants. Plaintiffs also contended that AB 832 substantially impaired their contractual relationships with their renters by rewriting the leases entered into and significantly interferes with the owners' reasonable expectations in violation of the Constitution's Contract Clause. Finally, plaintiffs alleged that AB 832 provided no immediate or adequate mechanism for compensating owners for the loss of their property rights and as a result, plaintiffs will suffer serious and irreparable harm to their constitutional rights unless defendants are immediately enjoined from implementing and enforcing AB 832.

DEFENDANTS' CONTENTIONS: Defendants alleged that plaintiffs' action was moot and the court therefore lacks subject matter jurisdiction since the allegedly illegal rent moratorium was no longer in effect. Defendants also argued that there that there was no violation of the Due Process, Takings, or Contracts Clauses.

Result

The court dismissed the case for lack of subject matter jurisdiction.