On April 14, 2021, U.S. District Judge Joanna Seybert dismissed a lawsuit filed by a group of five landlords against Attorney General Letitia James (“AG James”) in the Eastern District of New York (Chrysafis, et al. v. James, Case No. 2:21-cv-00998-JS-ARL). As we highlighted in our March 4, 2021 alert, the suit challenged Part A of New York’s COVID-19 Emergency Eviction and Foreclosure Prevention Act of 2020 (the “Act”) on constitutional free speech and due process grounds. While the legislation also halts residential foreclosure proceedings and tax lien sales, the plaintiffs had hoped to enjoin enforcement of the Act’s moratorium on residential evictions for tenants facing pandemic-related hardship until August 31, 2021. In particular, Part A of the Act automatically stays eviction proceedings against tenants who submit a hardship declaration form that certifies, under penalty of perjury, their qualifications for protection under the Act.
Yet, Judge Seybert ruled against the landlords without reaching the merits of their claims and granted AG James’ motion to dismiss for lack of subject matter jurisdiction. Specifically, the Office of the Attorney General (OAG) argued that the plaintiffs’ suit was barred by the Eleventh Amendment and its guarantee of sovereign immunity, which prohibits suits by private citizens against a nonconsenting U.S. state (or against an agency or officer acting on behalf of such state) in federal court. In defense, landlords’ counsel relied on Ex Parte Young, 209 U.S. 123 (1908), a case in which the Supreme Court first recognized an exception to the Eleventh Amendment for private lawsuits based on alleged violations of the U.S. Constitution by state officials: “. . . through the doctrine of Ex Parte Young, a party may bring ‘a suit for injunctive [or declaratory] relief challenging the constitutionality of a state official's actions in enforcing state law.’” Riley v. Cuomo, Case No. 2:17-cv-01631, 2018 WL 1832929, at *4 (E.D.N.Y. Apr. 16, 2018). Accordingly, the plaintiffs maintained that the Eleventh Amendment did not bar their complaint, since it alleged ongoing violations of the First Amendment and Fourteenth Amendment by AG James, a state official.
Judge Seybert was not persuaded, however, finding instead that AG James was not a proper party to the landlords’ action in the first instance. According to the court, the landlords had failed to establish a key requisite of the Ex Parte Young exception: an adequate nexus between the alleged constitutional infraction—in this case, a duty to enforce or enforcement of Part A of the Act—and the state official made a party to the lawsuit. Ex Parte Young, 209 U.S. at 157. To establish that nexus, plaintiffs’ counsel pointed to guidelines the OAG issued to local law enforcement regarding the Act’s provisions and unlawful evictions, all to suggest that AG James has a duty to and did so enforce the Act. But in the court’s view, those guidelines were “general guidance to local officials about their responsibilities in administering a state statute” (emphasis added), and did not imply a duty on behalf of, or constitute enforcement by, a state official, as the limited Ex Parte Young exception requires. Judge Seybert’s opinion also makes clear that the landlords might have avoided application of the Eleventh Amendment if the OAG had had a “particular duty to enforce” the Act (whether by the Act’s plain terms or based on the general laws of New York), or if AG James herself had threatened to enforce its allegedly unconstitutional provisions to the plaintiffs’ detriment. Absent such facts, the court found no alternate basis on which to predicate the denial of sovereign immunity the landlords sought.
UPDATE (May 7, 2021): On May 4, 2021, New York Governor Andrew Cuomo signed Senate Bill 6362-A/Assembly Bill 7175-A, effectively extending the Act until August 31, 2021. Just two days later, the Chrysafis plaintiffs joined in a new federal complaint with the Rent Stabilization Association of New York City and asserted against Chief Administrative Judge Lawrence Marks the same constitutional claims they initially had raised against AG James. At least on its face, the new complaint (No. 21-cv-2516) seems to avoid the improper defendant issue that led Judge Seybert to rule against the plaintiffs. As the OAG asserted in its motion to dismiss, the court system—and not AG James—is charged with administering the Act.
The new complaint, also filed in the Eastern District of New York, sets forth a demand for both preliminary and permanent injunctive relief to prevent further enforcement of the Act.
UPDATE (June 15, 2021): On June 11, 2021, United States District Judge Gary R. Brown declined to grant the preliminary injunction for which the Chrysafis plaintiffs filed their May 6, 2021 complaint (as detailed in the update above) in the Eastern District of New York. The complaint named as defendants Chief Administrative Judge Lawrence Marks, the New York City Department of Investigations, and various sheriffs who, in compliance with the Act, have neither filed nor enforced eviction warrants against tenants suffering pandemic-related financial hardship. District Judge Brown ultimately sided with the defendants, finding that their compliance with the Act did not violate the constitutional, due process rights of the Chrysafis plaintiffs, as the plaintiffs had argued.
In fact, Judge Brown’s view was that the Act constitutes legislative—and not adjudicative—action, which is not susceptible of due process challenges. As he wrote in his decision, “[L]egislative actions entail ‘the formulation of a general rule to be applied . . . at a subsequent time,’” while “[a]cts are adjudicative, and hence subject to due process claims, where they involve ‘facts about the parties and their activities, businesses, and properties,’ and are ‘designed to adjudicate disputed facts in particular cases’” (citing Edelhertz v. City of Middletown, 943 F. Supp. 2d 388, 395 (S.D.N.Y. 2012), aff’d sub. nom. Edelhertz v. City of Middletown, New York, 714 F.3d 749 (2d Cir. 2013).
This finding proved fatal to the plaintiffs’ complaint, which rested largely on the due process claims they initially brought against AG James. Since the Act “governs the timing, format and litigation of eviction proceeds generally,” the court labeled it a legislative action not subject to the traditional notice and hearing requirements associated with due process. Finally, Judge Brown further deferred to the New York legislature, citing its authority to craft the Act and measures like it to advance “broad public policy,” which the courts “neither can nor should second-guess . . .” Plaintiffs’ counsel intends to appeal Judge Brown’s decision.
UPDATE (July 1, 2021): As described in the updates above, the landlords and Rent Stabilization Association ultimately appealed District Judge Brown’s decision in the Chrysafis case to the United States Court of Appeals for the Second Circuit. They had hoped the Second Circuit would grant a temporary injunction barring enforcement of the Act, at least for as long as the appeals process in Chrysafis is ongoing. However, on June 25, 2021, U.S. Circuit Judge William J. Nardini denied their request (Docket No. 21-1493). The judge agreed, however, to expedite the landlords’ appeal, referring it to a three-judge panel for review to take place as early as the week of July 19, 2021. Even though Governor Cuomo declared an end to the state of emergency in New York as of June 24, 2021, the Act is authorized legislation and, as such, will remain in place until its expiration on August 31, 2021. Nevertheless, it remains to be seen whether the “official” end of the COVID-19 health emergency will affect the Second Circuit’s review of the Act in the weeks to come.
We will continue to monitor this case and provide updates. Please do not hesitate to contact the Morrison & Foerster team if you have any questions.
Michael Machado, a Law Clerk in our New York office, contributed to the writing of this alert.