HUD Seeks Stay of Tennessee District Ruling that CDC’s Eviction Moratorium was Unlawful

On Thursday in the Sixth Circuit, the Department of Housing and Urban Development (HUD) filed an emergency motion to stay the March 16 Western District of Tennessee judgment that declared unlawful a temporary eviction moratorium issued by the Centers for Disease Control and Prevention (CDC) in response to the COVID-19 pandemic.

The Public Health Service Act (PHSA) gives broad powers to the CDC to mitigate contagious disease spread, the motion noted. Thus, the agency issued the moratorium in September 2020 to curb the number of “individuals who otherwise would likely become homeless or move into settings such as crowded shelters, thereby increasing the spread of COVID-19,” according to the motion. The agency consulted data that showed shared living centers “significantly exacerbate the spread of COVID-19,” the CDC order said. In December 2020, Congress overwhelmingly voted in favor of extending the moratorium through Jan. 31, and the CDC extended it from Jan. 29 until March 31, citing the ongoing COVID-19 crisis — compounded by newly discovered strains — as the basis for the action.

The moratorium is not all-encompassing; not all tenants qualify as “covered persons” who may not be evicted — just those who provide a declaration showing that they satisfy certain criteria to their landlord, according to the order. The order also does not absolve tenants’ responsibility to pay rent or comply with their leases, the motion noted, and it still allows landlords to begin eviction proceedings as long as the tenant is not actually evicted while the order remains in effect.

Tiger Lily LLC filed a complaint, challenging the order on statutory and constitutional grounds and requesting a preliminary injunction for alleged “irreparable harm.” The district court denied the injunction, saying that the plaintiff did not establish irreparable harm because the CDC order is temporary and because tenants are not relieved of their responsibility to pay rent. Further, the district court said the plaintiff could not show a lack of adequate remedy at law because they still may bring tenants to court to recover unpaid rent.

However, the District Court still entered final judgment March 16 that said the order oversteps its statutory authority and cannot be enforced in the Tennessee district. Since then, local courts in the Western District of Tennessee have been told evictions may proceed, according to the motion.

HUD argued that a stay of this ruling is warranted, as data from states that had moratoria and then lifted them showed that “lifting eviction moratoria led to a 40 percent increased risk of contracting COVID-19 among evicted persons and family or friends with whom they shared housing after eviction,” according to the CDC, among other data indicating the continued severity of the COVID-19 pandemic.

Notwithstanding the district court’s own finding that landlords’ temporary monetary delay or loss does not constitute irreparable injury, HUD noted that on March 11, Congress appropriated an additional $21.5 billion designed to reach landlords, who have had residents less able or unable to keep up with their rent during the pandemic, according to the American Rescue Plan Act.

On the challenge of whether the moratorium exceeds the CDC’s regulatory powers, HUD emphasized that the secretary of the Department of Health and Human Services, the agency able to delegate regulatory power to the CDC, may create and enforce regulations using their own judgment “to prevent the introduction, transmission, or spread of communicable diseases … from one State or possession into any other State or possession,” pursuant to the PHSA. HUD said it believed it is likely to succeed on the merits of the case for a number of reasons, namely for the dearth of precedent finding a delegation to be excessive and numerous Supreme Court rulings that have sustained broad authority of agencies to delegate.

Glankler Brown PLLC is representing Tiger Lily.