October 22, 2014

S.F. to appeal Levin defeat–calls out PLF

By J. David Breemer Senior Attorney

Today, the City of San Francisco issued a press statement announcing its plans to appeal its recent loss in the case of Levin et. al. v. City and County of San Francisco. In that case, a federal court held that the City unconstitutionally took private property in enacting a law requiring landlords to pay tenants massive sums of money ($118,000 for the Levins) before they can leave the rental business. See here for a summary of the decision.

In its statement today, the City bemoaned yesterday’s defeat and the important limits it sets on the ability of government to extort property in the permit process:

“This decision places a new and significant obstacle in front of cities defending development fees and other development approval conditions: they must show not only that a property owner’s actions cause social harm [to justify a condition addressing that harm], but also that the owner’s actions are the only cause of that harm.”

In part to evade such limits, the City vowed to appeal to the Ninth Circuit. In so doing, it recognized Pacific Legal Foundation’s historic role in holding the city accountable to the Constitution:

“The Pacific Legal Foundation is a familiar legal foe to the San Francisco City Attorney’s Office, having brought many federal constitutional challenges to the city’s affordable housing policies.”

The release then ends with a bizzare potshot at the Foundation: the City harps that it defeated PLF in a prior property rights case, San Remo Hotel v. City and County of San Francisco.  But PLF attorneys were not the lawyers for the property owners in the San Remo case. In any event, the City’s reference to San Remo is ironic because, when the City relied on that decision in the Levin case, Judge Breyer soundly rejected its applicability.

Ultimately, this dispute is not between PLF and the City. It is between ordinary property owners like the Levins and City officials who want to force rental owners to solve an affordable housing crisis the City itself caused. Nevertheless, PLF has issued this response to the City’s appeal statement:

“It is disappointing that city officials are determined to continue flouting the United States Constitution and to defend the indefensible,” said PLF Principal Attorney J. David Breemer. “The Levins and Pacific Legal Foundation would prefer that the city spend its energy on coming up with solutions to the affordable housing crisis that are constitutional and just. However, if city officials are determined to press on with litigation, so is Pacific Legal Foundation. As Judge Breyer recognized, the law is nothing less than an unconstitutional ransom demand on San Francisco’s rental property owners. If necessary, PLF is prepared to go all the way to the U.S. Supreme Court to put a final tombstone on this oppressive law.”

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Levin v. City and County of San Francisco

Dan and Maria Levin live in the upstairs unit of their two-story home in San Francisco, California. They would like to use the lower unit for friends and family, but a city ordinance required them to pay their tenant $118,000 to withdraw the unit from the rental market. This amount represents the difference between the tenant’s existing, rent-controlled rate and the cost of acquiring a comparable unit at open market rates, for two years. Representing the Levins and others, PLF successfully sued to strike down this ordinance as an unconstitutional taking in violation of the Fifth Amendment and violation of California’s Ellis Act, which guarantees to property owners the right to take property off the rental market.

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