Sylvia Landfield Trust; Maria A. Lane; Jeff Kern; Ram Gill; Khushwant Gill, Plaintiffs-Appellants,
City of Los Angeles; Antonio Villaraigosa, Mayor; Rockard J. Delgadillo, City Attorney, Defendants-Appellees.
Submitted February 7, 2013 [*] Pasadena, California
Appeal from the United States District Court for the Central District of California Josephine Staton Tucker, District Judge, Presiding D.C. No. 2:09-cv-01798-JST-RZ
Lee Grant, Law Office of Lee Grant, Encino, California, for Plaintiffs-Appellants.
Carmen A. Trutanich, City Attorney, and Claudia McGee Henry, Senior Assistant City Attorney, Los Angeles, California, for Defendants-Appellees.
Before: Harry Pregerson, William A. Fletcher, and Jacqueline H. Nguyen, Circuit Judges.
The panel affirmed the district court's Fed.R.Civ.P. 12(b)(6) dismissal of plaintiffs' complaint challenging the constitutionality of the City of Los Angeles's Rent Escrow Account Program.
The Los Angeles Rent Escrow Account Program (REAP) is an administrative program codified in the Los Angeles Municipal Code which authorizes the Los Angeles Housing Department to place property into REAP when a landlord fails to repair habitability violations. Plaintiffs, four landlords whose separate apartment buildings were placed into REAP by the City, alleged that REAP, as applied to them, violated their substantive due process rights.
The panel held that: (1) REAP was rationally related to the legitimate governmental interests of repairing and preventing substandard housing; (2) REAP did not violate plaintiffs' substantive due process rights; and (3) plaintiffs' procedural challenges failed to support an as-applied substantive due process claim because none of the allegations plausibly suggested that REAP was arbitrarily and unreasonably applied to any of the plaintiffs, or that the placement of plaintiffs' properties into REAP rose to a level that shocked the conscience.
PREGERSON, Circuit Judge.
This case involves a constitutional challenge to the defendant City of Los Angeles's ("City") Rent Escrow Account Program ("REAP"). REAP is an administrative program codified in the Los Angeles Municipal Code ("LAMC"). The Los Angeles Housing Department ("Housing Department") places property into REAP when a landlord fails to repair habitability violations. See Housing Department Rent Adjustment Commission Regulations ("RACR") § 1200.04. When a property is placed into REAP, tenants pay a reduced rent. RACR §§ 1200.05–.06. The Housing Department determines the amount of the reduced rent based on the severity of the habitability violations. RACR §§ 1200.05–.06. Tenants may choose to pay their reduced rent to either their landlord or an escrow account maintained by the Housing Department. LAMC § 162.07; RACR §§ 1200.05, 1200.13A. If tenants pay into the escrow account, the tenant, landlord, or Housing Department may apply to the escrow account's manager for funds to repair the habitability violations in the tenant's housing. LAMC § 162.07; RACR § 1200.13(B).
Plaintiffs are four landlords whose separate apartment buildings were placed into REAP by the City. Plaintiffs in their complaint allege that REAP, as applied to them, violated their substantive due process rights. The district court dismissed plaintiffs' complaint under Federal Rule of Civil Procedure ...