The CDC Will Extend its Eviction Moratorium through the End of June, Despite Mixed Reception in the Federal Courts
Kelley Drye Client Advisory
June 23, 2021
The COVID-19 pandemic has fueled fears about mounting evictions, prompting the federal government, as well as many states, cities, and counties, to minimize the impact of the crisis on tenants, including by placing moratoria on evictions. In March 2020, Congress passed the Coronavirus Aid, Relief, Assistance, and Economic Stimulus (“CARES”) Act in March 2020. After the CARES Act expired, the Centers for Disease Control and Prevention (“CDC”) ordered a nationwide moratorium on residential evictions. To justify its unprecedented involvement in landlord-tenant relations, the CDC cited a federal regulation, 42 C.F.R. § 70.2, and a provision of the Public Health Service Act, 42 U.S.C. § 264(a), which empower the agency to sanitize property exposed to contagions.

Ever since the CDC issued the order, plaintiffs who own or manage residential properties have challenged the CDC’s order and its subsequent extension in multiple courts across the country. But despite receiving a mostly negative reception in the federal courts, the CDC has not yet announced whether it will extend the moratorium, which is set to expire on June 30, 2021. Below, we provide historical background on the CDC eviction moratorium, discuss current legal challenges to the CDC’s actions, and highlight several COVID-related tenant protections at the state and local level that will remain in effect beyond the CDC order’s expiration date.
 

Background on the CARES Act and CDC Moratorium

Congress responded to the COVID-19 pandemic by passing CARES Act in March 2020. See Pub. L. No. 116-136, 134 Stat. 281 (2020). Among other relief provisions, the CARES Act included a 120-day moratorium on eviction filings based on nonpayment of rent for tenants residing in certain federally financed rental properties. After that congressionally authorized moratorium expired on July 25, 2020, the CDC Director, on September 4, 2020, unilaterally ordered a new moratorium, halting evictions of certain “covered persons” through the end of 2020.

The CDC purportedly located statutory authority for the moratorium in Section 361 of the Public Health Service Act, 42 U.S.C. § 264, which authorizes the Secretary of Health and Human Services to “make and enforce such regulations as in his judgment are necessary to prevent the introduction, transmission, or spread of communicable diseases.” Id. § 264(a). To carry out and enforce those regulations, the statute authorizes the Secretary to provide for “inspection, fumigation, disinfection, sanitation, pest extermination, destruction of animals or articles found to be so infected or contaminated as to be sources of dangerous infection to human beings, and other measures, as in his judgment may be necessary.” Id. The statute also grants the Secretary authority to make and enforce regulations for quarantining infected persons. Id. § 264(b–d). The Secretary has delegated its powers under § 264 to the CDC through regulation. See 42 C.F.R. § 70.2.

Shortly after the CDC issued its eviction moratorium, Congress passed the Consolidated Appropriations Act, which extended the order from December 31, 2020 to January 31, 2021. Pub. L. No. 116-260, § 502, 134 Stat. 1182 (2020). On January 29, 2021, just before that statutory extension lapsed, the CDC Director issued a new directive extending the order through March 31, 2021. 86 Fed. Reg. 8020-01. She again relied only on the generic rulemaking power arising from the Public Health Service Act. Id. The Director then extended and modified the order in September 2020, extending the eviction ban until June 30, 2021.
 

Legal Challenges to the CDC Eviction Moratorium

Property owners have filed multiple lawsuits challenging the legality of the moratorium. In the past two months, three federal district courts and one federal court of appeals have ruled that the CDC does not have authority to halt evictions nationwide, while the U.S. Court of Appeals for the D.C. ruled that the order likely passes constitutional muster.

The gravamen of the legal challenges is that the CDC overstepped the authority delegated to it by Congress and instead took lawmaking power into its own hands. As noted above, the CDC justified its moratorium on a statutory provision that allows the agency to engage in “inspection, fumigation, disinfection, sanitation, pest extermination, destruction of animals or articles … and other measures, as in [its] judgment may be necessary.” The CDC focused on the phrase “other measures,” reading this as an essentially unbounded font of authority to take any measure the agency deems necessary to combat disease. This includes many measures that states have taken, like shutting down businesses, prohibiting private gatherings, and, of course, banning evictions. The CDC argued that the agency has the power to reverse the decision of every state that has “re-opened” and force those states to adhere to a federally imposed shutdown.

The challengers argued that “other measures” refers only to actions similar to the actions listed that precede it, like disinfection or fumigation—activities that the CDC traditionally engages in. They also note that even if the statute did contemplate a nationwide ban on eviction, then the law likely violates the Constitution by impermissibly delegating its lawmaking power to the CDC.

The government won several preliminary victories in the legal battle over the CDC’s moratorium when two federal courts in Georgia and Louisiana declined to strike down the CDC’s moratorium. See Brown v. Azar, No. 1:20-cv-03702-JPB (N.D. Ga. Oct. 29, 2020) & Chambless Enterprises LLC v. Redfield, No. 3:20-cv-01455 (W.D. La. Dec. 22, 2020). But the tide soon turned, as four federal courts, as well as a federal courts of appeals, declared the moratorium illegal.

First, on February 25, a federal court in Texas struck down the CDC moratorium as a violation of the U.S. Constitution’s Commerce Clause. See Terkel v. Centers for Disease Control & Prevention, 2021 WL 742877, at *4–6 (E.D. Tex. Feb. 25, 2021) (declaring that the moratorium exceeds the scope of federal power the Commerce Clause permits). Two weeks later, an Ohio federal court in Skyworks Ltd. v. Centers for Disease Control, No. 5:20-cv-2407 (N.D. Ohio Mar. 10, 2021) found that the federal public health statute does not vest the CDC with authority to halt evictions nationwide. The Skyworks court gave short shrift to the CDC’s argument that the court should follow the two early decisions that sided with the CDC, observing that those decisions “have the feel of adopting strained or forced readings of the statute, stretching to rationalize the government policy at issue.” A federal court in Tennessee adopted the same approach soon after, which prompted the government’s application for an emergency stay from the Sixth Circuit.

Finally, in early May, a federal judge in the District of Columbia vacated the CDC’s eviction, ruling the agency exceeded its statutory authority. Alabama Association of Realtors et al. v. U.S. Department of Health and Human Services et al., No. 1:20-cv-03377 (D.D.C. May 4, 2021). At the same time, the court placed an administrative stay on her own ruling, which the U.S. Court of Appeals for the D.C. Circuit upheld on June 2, in an order we discuss in greater detail below.
 

The Sixth Circuit Rules that CDC’s Order is Likely Unconstitutional

On March 29, the Sixth Circuit Court of Appeals, denied the government’s request for a stay, holding that the CDC was unlikely to succeed on the merits because the Public Health Services Act did not authorize the CDC director to ban evictions. Tiger Lilly, LLC, et al. v. United States Department of Housing and Urban Development et al., No. 21-5256 (6th Cir. Mar. 29, 2021),

The Sixth Circuit first rejected the government’s assertion that a nationwide eviction moratorium was among the “other measures” for disease control that Congress envisioned when drafting the statute. Applying the canon ejusdem generis, which says “where general words follow specific words in a statutory enumeration, the general words are construed to embrace only objects similar in nature to those objects enumerated by the preceding specific words.” Thus, the “other measures” envisioned in the statute are measures akin to “inspection, fumigation, disinfection, pest extermination” etc., not a moratorium on eviction.

Next, the Sixth Circuit declined to read the Public Health Service Act to allow the CDC the power to insert itself into the landlord-tenant relationship, which is historically in the province of the states. The court found no unmistakably clear textual evidence of Congresses’ intent to alter the constitutional balance of power between the state and the federal government that would allow the CDC to invade the traditionally state-operated arena of landlord tenant relations.

Finally, the court noted that the CDC’s broad construction of the Act raised serious concerns about the delegation of legislative power to the executive branch. Although it did not expressly hold that the order violated the non-delegation doctrine, which limits the extent to which Congress can delegate its lawmaking power to executive agencies, the court strongly suggested that allowing the CDC to use this statute to impose an eviction moratorium would give it virtually unlimited power to suppress any activity of any kind. That, in turn, strengthens the case for giving the statute a narrower reading, under the longstanding rule that courts, where possible, should interpret federal laws in ways that avoid raising constitutional problems.
 

D.C. Circuit Deals a Setback to Opponents of the Eviction Moratorium—and Creates a Circuit Split

On June 2, 2021, the U.S. Court of Appeals for the D.C. Circuit issued a ruling in favor of the legality of the CDC order, breaking a streak of five straight victories for the plaintiff-challengers, and creating a split with the U.S. Court of Appeals for the Sixth Circuit. Although the ruling is a setback for plaintiffs challenging the legality of the CDC order, the court did not reach the merits. Rather, the decision affirmed the lower court’s decision to stay enforcement of its ruling against the moratorium while the case continues to be litigated. That said, the appellate judges made clear that they believe the government is likely to prevail on the merits:
 

First, the CDC’s eviction moratorium falls within the plain text of 42 U.S.C. § 264(a). Congress expressly determined that responding to events that by their very nature are unpredictable, exigent, and pose grave danger to human life and health requires prompt and calibrated actions grounded in expert public-health judgments. Section 264(a) authorizes the Secretary of HHS “to make and enforce such regulations as in his judgment are necessary to prevent the introduction, transmission, or spread of communicable diseases from foreign countries into the States or possessions, or from one State or possession into any other State or possession.” 42 U.S.C. § 264(a).1 Congress thereby designated the HHS Secretary the expert best positioned to determine the need for such preventative measures, twice stating that it authorizes such measures as the Secretary determines “in his judgment [are] necessary.” 42 U.S.C. § 264(a). That text also makes a determination of necessity a prerequisite to any exercise of Section 264 authority, and that necessity standard constrains the granted authority in a material and substantial way.

Here, to ensure that the moratorium was tailored to the necessity that prompted it, HHS carefully targeted it to the subset of evictions it determined to be necessary to curb the spread of the deadly and quickly spreading Covid-19 pandemic. Notably, Appellees do not dispute HHS’s determination that the moratorium would “prevent the [interstate] introduction, transmission, or spread” of COVID….

The district court had rejected this reasoning, which would give the CDC the authority to shut down virtually any activity of any kind, since doing so can always potentially reduce the spread of a contagious disease in some way. On this reading of the statute, there is no “material and substantial” limit to the CDC’s authority, which would violate constitutional constraints on delegation of legislative authority to executive agencies.
 
The D.C. Circuit also divined that Congress implicitly endorsed the CDC’s broad interpretation of the scope of its power when it imposed a similar moratorium in December (which expired at the end of January 2021):
 

Congress has expressly recognized that the agency had the authority to issue its narrowly crafted moratorium under Section 264. Last December, rather than enact its own moratorium, Congress deliberately chose legislatively to extend the HHS moratorium and, in doing so, specifically to embrace HHS’s action “under section 361 of the Public Health Service Act (42 U.S.C. 264)[.]” Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, div. N, title V, § 502, 134 Stat. 1182, 2078–79 (Dec. 27, 2020).

Is a Showdown in the Supreme Court on the Horizon?

We now have a circuit split over the legality of the CDC order. That, of course, increases the odds that the issue will eventually reach the Supreme Court. The plaintiffs in the D.C. Circuit have already asked the Court to step in and overturn the D.C. Circuit ruling, on an emergency basis. With the current extension of the eviction moratorium set to expire on June 30, 2021, it is doubtful that the Supreme Court will move before then. But if the Biden administration extends the order again, the Court may well take up the case. If that occurs, and the ideological division over this issue—evident in the lower court rulings—continues, the CDC order is unlikely to survive, given the current composition of the nation’s highest court.

Whether or not the Supreme Court grants cert, its decision today in Cedar Point Nursery v. Hassid raises further doubts about the CDC order’s lawfulness. (We covered oral argument in Cedar Point in a previous alert.) In Cedar Point, the justices held 6-3 that a California regulation granting labor organizations a “right to take access” to an agricultural employer’s property to solicit support for unionization constitutes a per se physical taking under the Fifth Amendment’s Takings clause. If California’s law forcing property owners to grant third parties access to their private property three hours per day, 120 days per year constitutes a per se physical taking, then surely the CDC’s order forbidding (indefinitely!) landlords from evicting non-paying renters is a taking as well.
 

Current State and Local Eviction Protections

So what happens to the more than 10 million Americans currently behind on their rent if the CDC does not extend the eviction moratorium past June 30? Due to a growing number of state and local protections, many struggling renters will be able to stay in their homes past the expiration date. In California, for example, the governor has signed legislation extending the eviction ban through June 30, 2021. The legislature also created a state rental assistance program that allocates $2.6 billion in federal rental assistance to aid income-qualified tenants most at-risk with unpaid rent. Assistance will also be extended to property owners who agree to waive 20 percent of unpaid rent. The New York legislature, meanwhile, extended a law prohibiting evictions through August 31, 2021. And next door in New Jersey, the governor issued an executive order that extends the moratorium on evictions until the end of the state-declared public health emergency.

Many cities and counties have enacted policies to protect renters affected by COVID-19 too. The city of Austin and surrounding Travis County, Texas, will prohibit evictions from resuming until August. And the city Seattle voted last week to extend the city’s moratorium on evictions through September 30.