On September 7, 2023, Darby Development Company, Inc. v. United States was argued before the U.S. Court of Appeals for the Federal Circuit. A three-judge panel was assigned to the case: Judges Kara Stoll, Tim Dyk and Sharon Prost. 

The appeal is not a new trial; it is focused instead on the legal issues decided by the trial court that have been briefed before the appellate court. The issue in the case is whether the U.S. Centers for Disease Control and Prevention’s (CDC) federal eviction moratorium is an illegal taking under the Fifth Amendment of the U.S. Constitution. If the CDC’s action is ruled to be a taking, compensation must be paid to those damaged by the government action. 

The U.S. Department of Justice (DOJ) defended the CDC’s lawsuits across the country back in 2020-2021, arguing that the CDC acted legally. The U.S. Supreme Court (SCOTUS) later ruled in Alabama Realtors that the CDC had exceeded its authority in issuing the eviction moratorium. In a stunning pivot, the DOJ now argues that if the CDC exceeded its authority, there can be no taking, citing case law that takings cases are restricted to government actions that are authorized. If the CDC’s actions were not authorized, the moratorium cannot be construed as an illegal taking.   

The judges all appeared to be well prepared for the oral argument and asked several questions of the lawyers. The Plaintiff’s lawyer, Chip Magid of Dorsey & Whitney, LLC, brilliantly argued that the DOJ’s position would leave the Plaintiffs with no recourse for recovery if the CDC acted illegally contrary to the explicit language of the Fifth Amendment. Much of the oral argument was devoted to the concept of what is necessary to constitute “authorized” government action. 

NAA expects a decision from the court before the end of the year. In the coming weeks, NAA will organize its efforts to position the case on the SCOTUS docket and recruit others within the real estate business community to support our efforts. 

The National Apartment Association and Dorsey & Whitney LLP would like to thank the following amici for their support throughout this case: the National Association of Home Builders, the National Association of Realtors and the New Civil Liberties Alliance.