Heights Apartments, LLC v. Walz

510 F.Supp.3d 789

HEIGHTS APARTMENTS, LLC and Walnut Trails, LLLP, Plaintiffs,

v.Tim WALZ, in his individual and official capacity as Governor of the State of Minnesota, Keith Ellison, in his individual and office capacity as Attorney General of the State of Minnesota, and John Doe, Defendants.

Case No. 20-CV-2051 (NEB/BRT)

United States District Court, D. Minnesota.

Signed December 31, 2020

Michael Kemp, Hansen Dordell, Saint Paul, MN, for Plaintiffs.

Elizabeth C. Kramer, Michael P. Goodwin, Office of Minnesota Attorney General, St. Paul, MN, for Defendants.

ORDER ON MOTION TO DISMISS AND MOTION FOR PRELIMINARY INJUNCTION

Nancy E. Brasel, United States District Judge

In response to the COVID-19 pandemic, Minnesota Governor Tim Walz ("Governor Walz") has issued a series of executive orders designed to slow the spread of the disease. Several of these executive orders ("EOs") limit landlords’ ability to file eviction actions against residential tenants. Plaintiffs Heights Apartments, LLC and Walnut Trails, LLLP (collectively, the "Landlords") filed this suit against Governor Walz and Minnesota Attorney General Keith Ellison ("Attorney General Ellison"; collectively, "the Government"), seeking to vacate and enjoin enforcement of the EOs affecting landlords’ ability to remove tenants. The matter is now before the Court on the Landlords’ motion for preliminary injunction (ECF No. 5) and the Government's motion to dismiss (ECF No. 15). For the reasons that follow, the Court grants the Government's motion to dismiss, and denies the Landlords’ motion for preliminary injunction as moot.

BACKGROUND

The Court draws the following background primarily from the Complaint and exhibits attached to the Complaint, accepting the factual allegations as true and drawing all reasonable inferences in the Landlords’ favor. Topchian v. JPMorgan Chase Bank, N.A. , 760 F.3d 843, 848 (8th Cir. 2014). In doing so, the Court disregards any conclusory allegations or legal conclusions. See Glick v. W. Power Sports, Inc. , 944 F.3d 714, 717 (8th Cir. 2019).

I. The COVID-19 Pandemic

In December 2019, individuals in Wuhan, China identified a novel coronavirus. (ECF No. 13-6 at 1.) In the ensuing months, the disease spread across the world. (Id. ) The novel coronavirus came to be known as SARS-CoV-2, and the disease that it causes is called COVID-19. (Id. ) The virus is highly transmissible and is primarily spread through exchange of respiratory droplets emitted when a person talks, breathes, coughs, or sneezes. (ECF No. 13-1 at 2; ECF No. 13-2 at 1.) The virus transmits more easily indoors, especially in crowded, enclosed spaces. (ECF No. 13-3 at 1.)

Minnesota's first case of COVID-19 was confirmed on March 6, 2020. Health Officials Confirm First Case of Novel Coronavirus in Minnesota , Minn. Dep't of Health (Mar. 6, 2020), https://www.health.state.mn.us/news/pressrel/2020/covid19030620.html. As of late-December 2020, the state has confirmed more than 413,000 COVID-19 cases, and over 5,200 Minnesotans have died from the disease. Situation Update for COVID-19 , Minn. Dep't of Health, https://www.health.state.mn.us/diseases/coronavirus/situation.html (last visited Dec. 30, 2020).

II. Eviction Moratoria

A. Walz's Executive Orders

On March 13, 2020, Governor Walz declared a peacetime emergency due to COVID-19. (ECF No. 1 ("Compl.") ¶ 8); Exec. Order No. 20-01.¹ Soon after, Governor Walz issued Executive Orders closing schools, (Exec. Order No. 20-02), closing bars and restaurants, (Exec. Order No. 20-04), delaying elective surgical procedures, (Exec. Order No. 20-09), and implementing a stay-at-home order, (Exec. Order No. 20-20).

Most relevant here, Governor Walz has issued several executive orders preventing landlords from evicting residential tenants except in delineated circumstances.² The first of these was EO 20-14, instituted on March 23, 2020.³ (ECF No. 1-1 ("EO 20-14").) EO 20-14 suspended landlords’ ability to file eviction actions and prevented landlords from terminating residential leases, with some exceptions. (EO 20-14 ¶¶ 1–2.) Under the exceptions, landlords were permitted to terminate a lease or file an eviction action when a tenant "seriously endanger[ed] the safety of other residents" or violated a state statute that prevents tenants from allowing drugs, prostitution, unlawful use of a firearm, or stolen property on the premises. (Id. ¶ 2); see Minn. Stat. § 504B.171, subd. 1. Nothing in EO 20-14 relieved tenants of their obligation to pay rent. (Id. ¶ 1.) A violation of EO 20-14 was a misdemeanor, punishable by a fine of up to $1,000 or imprisonment for up to ninety days. (Id. ¶ 5.) EO 20-14 was to remain in effect until the peacetime emergency ended or until EO 20-14 was rescinded. (Id. at 3.)

The intention of EO 20-14 and the orders that followed was to allow tenants who had been affected by the pandemic to remain stably housed, thus promoting public health and safety. (EO 20-14 at 2.) The Centers for Disease Control and Prevention ("CDC") has also issued an eviction moratorium, which further explains the rationale behind suspending evictions during the COVID-10 pandemic.⁴ Temporary Halt in Residential Evictions to Prevent the Further Spread of COVID-19, 85 Fed. Reg. 55,292 (Sept. 4, 2020) ("CDC Moratorium"). Keeping tenants in their homes helps prevent the spread of COVID-19 by making it easier for them to abide by stay-at-home orders, socially distance, and to quarantine and recover if diagnosed with COVID-19. Id. Additionally, tenants who are evicted may experience homelessness, which may cause them to move into crowded, shared living spaces, such as homeless shelters, where the risk of transmission of coronavirus is higher. Id. at 55,294. Research has confirmed that limiting evictions helps mitigate the spread of COVID-19. (ECF No. 35 (summarizing two studies of evictions and COVID-19 transmission).)

In early June, Governor Walz issued Executive Order 20-73, which clarified EO 20-14 and expanded the circumstances under which a landlord may terminate a lease or evict a tenant. (ECF No. 1-2 ("EO 20-73").) Specifically, EO 20-73 permits termination of a lease or eviction not only when a tenant endangers the safety of another resident, but also when a tenant seriously endangers the safety of a non-resident on the premises. (Id. ¶¶ 1–2.)

Executive Order 20-79, which Governor Walz signed in July, is the eviction moratorium currently in effect. (EO 20-79.) Recognizing that Minnesota's economy was slowly reopening and "that tenants may begin to move more safely," EO 20-79 made several changes to Minnesota's eviction moratorium scheme. (Id. at 1.) First, EO 20-79 rescinded the two previous eviction moratorium EOs. (Id. ¶ 1.) Second, it expanded protection for tenants; EO 20-79 restricts not only lease termination and eviction, but also landlords’ ability to decline to renew a tenant's lease. (Id. ¶ 2.) Third, EO 20-79 slightly expanded the circumstances under which landlords can terminate or choose not to renew a lease. Under EO 20-79, lease termination or nonrenewal are permitted when the property owner wishes to move into the unit or have family members live in the unit. (Id. ¶ 4.) Fourth, EO-20-79 permits evictions when the tenant "significantly damages property" on the premises, provided that the damage violates a term in the tenant's lease. (Id. ¶ 2(d)(ii).) Fifth, EO 20-79 requires landlords to give seven day's written notice to the tenant before filing an eviction action. (Id. ¶ 6.) Aside from these changes, EO 20-79 is more or less the same as EOs 20-14 and 20-73; EO 20-79 reiterates that it does not relieve tenants of their obligation to pay rent, and a violation of EO 20-79 is still punishable as a misdemeanor. (Id. ¶¶ 2, 10.)

Since initially declaring a peacetime emergency in March, Governor Walz has extended it monthly. See Exec. Orders Nos. 20-35, 20-53, 20-75, 20-78, 20-83, 20-89, 20-92, 20-97, 20-100. Currently, the peacetime emergency is in effect until January 13, 2021. Exec. Order No. 20-100 ¶ 4. Governor Walz has not rescinded EO 20-79, so it remains in effect. (EO 20-79 at 3 (declaring that EO 20-79 remains in effect until the peacetime emergency is terminated or until rescinded).)

B. CDC Eviction Moratorium

Minnesota's eviction moratorium is not the only current restriction on a landlord's ability to file an eviction action. In September, the CDC issued its own eviction moratorium. CDC Moratorium, 85 Fed. Reg. 55,292. The CDC Moratorium generally forbids landlords from evicting tenants from residential property, but like the Minnesota moratorium, the CDC Moratorium provides a number of exceptions under which a landlord may evict a tenant. The circumstances permitting eviction are generally broader in the CDC moratorium than in Minnesota's moratorium. Under the CDC Moratorium, evictions are permitted where the tenant has (1) engaged in criminal activity on the property; (2) threatened the health or safety of other residents; (3) damaged property or posed an immediate and significant risk of damaging property; (4) violated any applicable building code, health ordinance, or other health and safety regulation; or (5) violated any other contractual obligation, aside from late payment of rent. Id. at 55,294. Landlords who violate the CDC Moratorium face fines of up to $250,000 or jail time, or both. Id. at 55,296. Currently, the CDC Moratorium does not apply in Minnesota because the state has its own moratorium that offers at least as much public health protection as the CDC Moratorium.⁵ See id. at 55,294 (explaining that the CDC Moratorium does not apply in jurisdictions that have a moratorium on residential evictions that offers as much or more public health protection as the CDC Moratorium). If the eviction moratorium EOs were declared invalid or rescinded before the CDC Moratorium expires, the CDC Moratorium would then apply in Minnesota. The CDC Moratorium is currently in effect until January 31, 2021. Consolidated...