Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_18-cv-07186/USCOURTS-cand-4_18-cv-07186-4/pdf.json

Nature of Suit Code: 440
Nature of Suit: Other Civil Rights
Cause of Action: 42:1983 Civil Rights Act

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

LYNDSEY BALLINGER, et al.,

Plaintiffs,

v.

CITY OF OAKLAND,

Defendant.

Case No. 18-cv-07186-HSG 

ORDER GRANTING MOTION TO 

DISMISS

Re: Dkt. No. 32

Plaintiffs Lyndsey and Sharon Ballinger brought this challenge to Defendant City of 

Oakland’s Uniform Residential Tenant Relocation Ordinance, under which they were required to

pay their tenants nearly $7,000 to move back into their Oakland home. The City of Oakland 

moved to dismiss. See Dkt. No. 32. The Court finds that the Ballingers have not pled a 

cognizable legal theory and therefore GRANTS the City’s motion without leave to amend.

I. BACKGROUND

The Court begins by summarizing the relevant City of Oakland ordinances before turning 

to the Ballingers’ allegations.

A. City of Oakland Ordinances

In 2003, the City of Oakland passed the Just Cause for Eviction Ordinance, which 

prohibits landlords from evicting their tenants without cause. See Oakland, Cal., Mun. Code 

(“OMC” or “Code”) § 8.22.300–390.

1

 The City Council found that Oakland had a “prolonged 

 

1 All OMC provisions cited in this order are included in Exhibit A to the City’s Request for 

Judicial Notice, see Dkt. No. 33 (“RJN”), and are also available online at 

https://library.municode.com/ca/oakland/codes/code_of_ordinances. Because “[m]unicipal 

ordinances are proper subjects for judicial notice,” Tollis, Inc. v. Cty. of San Diego, 505 F.3d 935, 

938 n.1 (9th Cir. 2007), and the Ballingers do not oppose the request, see Opp. at 1 n.1, the Court 

takes judicial notice of the OMC.

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affordable housing crisis” and that similar good cause protections in neighboring cities (such as 

San Francisco, Berkeley, and Hayward) “have aided community stability and reduced urban 

problems associated with arbitrary disruption of stable households.” OMC § 8.22.300. That

ordinance specifies what constitutes good cause for eviction, such as when a tenant fails to pay 

rent or violates a material term of the lease. See OMC § 8.22.360.A.1–2. In addition, two 

categories of permissible no-fault evictions (as defined in the ordinance) are relevant to this 

lawsuit.2 First, a tenant may be evicted if the “owner of record seeks in good faith, without 

ulterior reasons and with honest intent, to recover possession of the rental unit for his or her 

occupancy as a principal residence where he or she has previously occupied the rental unit as his 

or her principal residence and has the right to recover possession for his or her occupancy as a 

principal residence under a written rental agreement with the current tenants.” OMC 

§ 8.22.360.A.8. Second, a tenant may be evicted if the “owner of record seeks in good faith, 

without ulterior reasons and with honest intent, to recover possession for his or her own use and 

occupancy as his or her principal residence.” OMC § 8.22.360.A.9.

On March 1, 2016, the Oakland City Council adopted Ordinance Number 13358, which 

requires landlords that evict tenants when withdrawing a unit from the rental market under the 

Ellis Act to make a relocation payment to the evicted tenants. See RJN Ex. B; see also OMC 

§ 8.22.450(A). 

On January 16, 2018, the Oakland City Council adopted the ordinance at issue in this 

lawsuit—the Uniform Residential Tenant Relocation Ordinance (“the Ordinance”). See First 

Amended Complaint (“FAC”), Dkt. No. 29-1 Ex. A; see also OMC § 8.22.800–870. The City 

Council found that “all major California rent-controlled jurisdictions surveyed . . . require 

relocation payments for no-fault evictions” and that evicted tenants “face displacement and great 

hardship” and “are forced to incur substantial costs related to new housing.” See FAC Ex. A at 2. 

Therefore, the Ordinance extended the relocation payment program established by Ordinance 

 

2 Another category allows an owner to withdraw a property from the rental market in accordance 

with California’s Ellis Act. See OMC § 8.22.360.A.11. The Ballingers’ original complaint 

contended that Oakland had violated the Ellis Act, see Compl., Dkt. No. 1 ¶¶ 99–103, but the 

amended complaint dropped that legal theory.

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Number 13358 to other no-fault evictions, including owner move-in evictions and condominium 

conversions. See id. The Ordinance set the uniform relocation payment for qualifying no-fault 

evictions at $6,500 per unit for studios and one-bedroom apartments, $8,000 per unit for twobedroom apartments, and $9,875 per unit for apartments with three or more bedrooms. See OMC 

§ 8.22.820.A. These amounts were set to increase annually based on the Consumer Price Index 

adjustment. OMC § 8.22.820.D. Under the Ordinance, a tenant who was ultimately evicted 

would be eligible for one-third of the uniform relocation payment upon move-in, two-thirds of the 

uniform relocation payment after having lived in the unit for one year, and the entire amount after 

two years of occupancy. OMC § 8.22.850.C.

B. The Ballingers’ Allegations

Lyndsey and Sharon Ballinger live with their two children in a three-bedroom home on 

MacArthur Boulevard in Oakland. See FAC ¶¶ 6, 22–23. Both Ballingers are members of the 

military: Sharon is a nurse practitioner currently stationed at Travis Air Force Base and Lyndsey is 

transitioning from the D.C. Air National Guard to a part-time role in the California Air National 

Guard. Id. ¶ 22. In 2015, the Ballingers were both active duty personnel in the United States Air 

Force and received orders to transfer to the Washington, D.C. area. Id. ¶ 24. Because they 

intended to return to Oakland following their assignment in Washington, they “decided to 

temporarily rent their house while on duty.” Id. ¶ 25.

The Ballingers leased their MacArthur Boulevard home for one year, beginning on 

September 13, 2016. Id. ¶ 26; see also id. Ex. C (lease agreement). After the one-year lease 

expired, it would convert to a month-to-month tenancy. Id. ¶ 26. Because Oakland had not yet 

passed the Ordinance, the lease “did not anticipate . . . a payment requirement, nor did it 

specifically acknowledge that the Ballingers intended to return to the home and use it as their 

primary residence.” Id. ¶ 27.

In late 2017, the Ballingers learned that they would be reassigned to the Bay Area. Id.

¶ 28. The following March, the Ballingers gave their tenants sixty days’ notice to vacate the 

MacArthur Boulevard house. Id. ¶ 29. Pursuant to the Ordinance, the Ballingers informed their 

tenants of their right to a $6,582.40 relocation payment and paid them half that amount. Id. ¶¶ 29–

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30. When their tenants vacated the house in late April 2018, the Ballingers paid them the 

remaining $3,291.20 required under the Ordinance. Id. ¶¶ 31–32. However, the Ordinance forced

the Ballingers to make the relocation payment “before the tenants claimed or incurred any 

relocation costs and without any means to verify how or where they would spend the money.” Id.

¶ 33.

C. The Ballingers Bring Suit

The Ballingers brought suit against the City of Oakland on November 28, 2018. See Dkt. 

No. 1. They filed the FAC on February 26, 2019, asserting six causes of action: (1) a facial 

Takings Clause claim for physical taking of private property for a private purpose, FAC ¶¶ 43–53; 

(2) facial and as-applied claims for unconstitutional exaction of private property, id. ¶¶ 54–64; (3) 

an as-applied claim for an uncompensated and unconstitutional physical taking, id. ¶¶ 65–73; (4) 

facial and as-applied claims for an unreasonable seizure in violation of the Fourth Amendment, id. 

¶¶ 74–84; (5) an as-applied claim for violation of due process, id. ¶¶ 85–95; and (6) a claim for 

unconstitutional interference with the obligation of contract, id. ¶¶ 96–104. The Ballingers seek a 

declaratory judgment, permanent injunction, damages, fees, and costs. See id. (Relief Sought).

D. Oakland Moves to Dismiss

Oakland moved to dismiss the amended complaint on March 12, 2019. See Dkt. No. 32 

(“Mot.”). The Ballingers opposed on March 25, see Dkt. No. 34 (“Opp.”), and Oakland replied on 

April 2, see Dkt. No. 35 (“Reply”). The Court held a hearing on the motion on April 11, 2019. 

See Dkt. No. 36 (minute entry).

II. LEGAL STANDARD

Federal Rule of Civil Procedure 8(a) requires that a complaint contain “a short and plain 

statement of the claim showing that the pleader is entitled to relief[.]” A defendant may move to 

dismiss a complaint for failing to state a claim upon which relief can be granted under Federal 

Rule of Civil Procedure 12(b)(6). “Dismissal under Rule 12(b)(6) is appropriate only where the 

complaint lacks a cognizable legal theory or sufficient facts to support a cognizable legal theory.” 

Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008). To survive a Rule 

12(b)(6) motion, a plaintiff must plead “enough facts to state a claim to relief that is plausible on 

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its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim is facially plausible 

when a plaintiff pleads “factual content that allows the court to draw the reasonable inference that 

the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). 

In reviewing the plausibility of a complaint, courts “accept factual allegations in the 

complaint as true and construe the pleadings in the light most favorable to the nonmoving party.” 

Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). Nonetheless, 

Courts do not “accept as true allegations that are merely conclusory, unwarranted deductions of 

fact, or unreasonable inferences.” In re Gilead Scis. Sec. Litig., 536 F.3d 1049, 1055 (9th Cir. 

2008). And even where facts are accepted as true, “a plaintiff may plead [him]self out of court” if 

he “plead[s] facts which establish that he cannot prevail on his . . . claim.” Weisbuch v. Cty. of 

Los Angeles, 119 F.3d 778, 783 n.1 (9th Cir. 1997) (quotation marks and citation omitted). 

If dismissal is appropriate under Rule 12(b)(6), a court “should grant leave to amend even 

if no request to amend the pleading was made, unless it determines that the pleading could not 

possibly be cured by the allegation of other facts.” Lopez v. Smith, 203 F.3d 1122, 1130 (9th Cir. 

2000) (quotation marks and citation omitted).

III. DISCUSSION

Oakland moves to dismiss all six of the Ballingers’ causes of action, as well as their 

requests for injunctive and declaratory relief. The Court begins with the Ballingers’ three Takings 

Clause causes of action before turning to their other constitutional causes of action.

A. Takings Clause Claims

The Takings Clause of the Fifth Amendment provides that “[n]or shall private property be 

taken for public use, without just compensation.” U.S. Const. amend. V. A person who has 

suffered a taking at the hands of a local government may bring a claim in federal court under 42 

U.S.C. § 1983 to obtain just compensation. See Knick v. Twp. of Scott, 139 S. Ct. 2162, 2172 

(2019).

 The Supreme Court has drawn a distinction between two types of takings: physical 

takings and regulatory takings. See Tahoe-Sierra Pres. Council, Inc. v. Tahoe Reg’l Planning 

Agency, 535 U.S. 302, 321 (2002). With respect to physical takings, the Fifth Amendment’s 

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“plain language requires the payment of compensation whenever the government acquires private 

property for a public purpose, whether the acquisition is the result of a condemnation proceeding 

or a physical appropriation.” Id. The same holds true for “total regulatory takings,” where the 

government “seeks to sustain regulation that deprives land of all economically beneficial use.” 

Lucas v. S.C. Coastal Council, 505 U.S. 1003, 1026–27 (1992). By contrast, the Fifth 

Amendment “contains no comparable reference to regulations that prohibit a property owner 

from making certain uses of her private property.” Tahoe-Sierra, 535 U.S. at 321–22. Thus, a 

challenge to a regulatory taking requires “essentially ad hoc, factual inquiries.” Penn Cent. 

Transp. Co. v. City of New York, 438 U.S. 104, 124 (1978). The government need compensate for 

a regulatory taking “only if considerations such as the purpose of the regulation or the extent to 

which it deprives the owner of the economic use of the property suggest that the regulation has 

unfairly singled out the property owner to bear a burden that should be borne by the public as a 

whole.” Yee v. City of Escondido, 503 U.S. 519, 523 (1992); see also Pa. Coal Co. v. Mahon, 260 

U.S. 393, 415 (1922) (“The general rule at least is that while property may be regulated to a 

certain extent, if regulation goes too far it will be recognized as a taking.”). Given the 

“longstanding distinction between acquisitions of property for public use, on the one hand, and 

regulations prohibiting private uses, on the other,” the Supreme Court has warned that it is 

“inappropriate to treat cases involving physical takings as controlling precedents for the evaluation 

of a claim that there has been a ‘regulatory taking,’ and vice versa.” Tahoe-Sierra, 535 U.S. at

323.

At first glance, this case would seem to fit within the regulatory taking category. After all, 

the Ballingers challenge a city ordinance that regulates how they make use of their property. But 

that is not the theory the Ballingers have chosen to pursue.3 Rather, according to the Ballingers, 

the Ordinance is an unconstitutional physical taking because it forces them to “turn over private 

funds to other private persons.” FAC ¶ 45; see also Opp. at 4. Because the “plaintiff is the master 

of the complaint,” Caterpillar Inc. v. Williams, 482 U.S. 386, 398–99 (1987), the Court will 

 

3

In fact, the Ballingers dropped their regulatory taking claim when they filed the FAC. See 

Compl., Dkt. No. 1 ¶¶ 65–72.

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analyze their claim as pled.

i. Physical Taking for Private Purpose

The Ballingers’ first cause of action asserts that the Ordinance, on its face, commands a 

physical taking of private property for a private purpose, in violation of the Fifth Amendment. See 

FAC ¶¶ 43–53. The City contends that this cause of action must be dismissed “because it does not 

state an independent claim, but rather is a redundant attempt to challenge the issue of whether the 

Ordinance serves a public purpose.” Mot. at 6. Oakland relies on Rancho de Calistoga v. City of 

Calistoga, in which the Ninth Circuit held that a “‘private takings claim’ cannot serve as an 

independent means to challenge an alleged regulatory taking” but instead “must function as part of 

the larger regulatory takings claim.” See 800 F.3d 1083, 1092 (9th Cir. 2015); see also MHC Fin. 

Ltd. P’ship v. City of San Rafael, 714 F.3d 1118, 1129 n.5 (9th Cir. 2013) (assuming without 

deciding that regulatory private taking claim was cognizable, despite being aware of no court that 

has ever recognized such a claim). The Ballingers assert that Rancho does not apply, because it 

was a regulatory takings case, and they are asserting a physical taking of their property. Opp. at 4.

The Court agrees that Rancho’s limitation does not apply to the Ballingers’ physical taking 

claims. The Supreme Court has cautioned that courts should “not apply . . . precedent from the 

physical takings context to regulatory takings claims.” Tahoe-Sierra, 535 U.S. at 323–24. And in 

a challenge to a physical taking, a plaintiff may assert that property was taken for a private 

purpose in violation of the Fifth Amendment. See Kelo v. City of New London, 545 U.S. 469, 477 

(2005) (noting that “it has long been accepted that the sovereign may not take the property of A for 

the sole purpose of transferring it to another private party B, even though A is paid just 

compensation”); Haw. Hous. Auth. v. Midkiff, 467 U.S. 229, 245 (1984) (“A purely private taking 

could not withstand the scrutiny of the public use requirement; it would serve no legitimate 

purpose of government and would thus be void.”). The Court notes that the term “public use” is 

construed broadly, to “afford[] legislatures broad latitude in determining what public needs justify 

the use of the takings power.” Kelo, 545 U.S. at 483. But ultimately the Court need not—and, 

practically speaking, cannot—decide whether there was a valid public use, because it concludes 

that there was no taking. Accordingly, the Court GRANTS the motion to dismiss the first cause 

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of action.

ii. Unconstitutional Exaction of Private Property

In their second cause of action, the Ballingers assert that the Ordinance is an 

unconstitutional exaction of private property because it conditions the exercise of their right to 

regain possession of their property on paying their tenants a relocation stipend. See FAC ¶¶ 55–

57. Oakland argues that this claim must be dismissed because the exaction analysis does not 

apply, and even if it did, the Ordinance satisfies the constitutional requirements.4 The Court 

begins with an overview of the unconstitutional exactions doctrine before turning to its 

applicability here.

a. Unconstitutional Exactions

The “unconstitutional conditions doctrine” exists to “vindicate[] the Constitution’s 

enumerated rights” by ensuring that “the government may not deny a benefit to a person because 

he exercises a constitutional right.” Koontz v. St. Johns River Water Mgmt. Dist., 570 U.S. 595, 

604 (2013) (internal quotation omitted). One “special application” of this general principle is the 

exactions doctrine, which exists to “protect[] the Fifth Amendment right to just compensation for 

property the government takes when owners apply for land-use permits.” Id.

The modern exactions doctrine was first articulated in Nollan v. California Coastal 

Commission, 483 U.S. 825 (1987). There, the California Coastal Commission told the Nollans 

that it would grant them a development permit to rebuild their oceanfront home only if they 

created a public easement so that beachgoers would have continued access to the shore. Id. at 

828–29. The Supreme Court reaffirmed that “land-use regulation does not effect a taking if it 

‘substantially advance[s] legitimate state interests’ and does not ‘den[y] an owner economically 

viable use of his land.’” Id. at 834 (alterations in original) (quoting Agins v. Tiburon, 447 U.S. 

255, 260 (1980)). However, the Court found that conditioning the permit on the creation of a 

 

4 Oakland also argued that the Ballingers’ claim “is not ripe for adjudication because [they] do not 

allege that they have exhausted state law procedures for obtaining compensation,” Mot. at 8, as 

was required by Williamson County Regional Planning Commission v. Hamilton Bank of Johnson 

City, 473 U.S. 172, 195 (1985). Since this motion was submitted, the Supreme Court overturned 

Williamson County. See Knick, 139 S. Ct. at 2179. Thus, failure to exhaust no longer creates a 

prudential barrier to federal court adjudication and the Court will proceed to the merits.

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public easement lacked a nexus with the original purpose of the building restriction, which had 

been to protect visual access to the beach. See Nollan, 483 U.S. at 837. Therefore, the condition

was not a valid land-use regulation but rather an attempt to advance state interests without 

compensation, which amounted to an unconstitutional exaction. See id. at 841–42. 

Seven years later, in Dolan v. City of Tigard, the Supreme Court considered a challenge to 

the city’s attempt to condition approval of a redevelopment permit on the property owner

dedicating roughly 10% of her property to an improved floodplain and a pedestrian and bicycle 

path. See 512 U.S. 374, 379–80 (1994). The Court held this permit condition to be an 

unconstitutional exaction, because the city had failed to show a “rough proportionality,” meaning 

an “individualized determination that the required dedication is related both in nature and extent to 

the impact of the proposed development.” Id. at 391.

Most recently, in Koontz, the Supreme Court identified “the central concern of Nollan and 

Dolan: the risk that the government may use its substantial power and discretion in land-use 

permitting to pursue governmental ends that lack an essential nexus and rough proportionality to 

the effects of the proposed new use of the specific property at issue, thereby diminishing without 

justification the value of the property.” 570 U.S. at 614. There, the Court held that the exactions 

doctrine prohibited the government from making “[e]xtortionate demands for property,” meaning

that a property owner could sue when the government denied a permit for refusing to accept its 

conditions. See id. at 606–07. In addition, the Court held that monetary exactions—a requirement 

that a property owner spend money, rather than give up a property interest—were subject to the 

nexus and rough proportionality requirements. Id. at 612. 

b. Applicability of Exaction Framework

Oakland contends that the Ordinance cannot be analyzed under the exaction framework

because no property was transferred to the City and because generally applicable legislation is not 

subject to the exaction analysis. See Mot. at 8–9. The Court considers each argument in turn.

1. Transfer of Property Interest

According to Oakland, the exaction framework does not apply, because the “Ordinance 

works no transfer of a property interest from Plaintiffs to the City.” Mot. at 9. The Court does not 

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find the analysis nearly so simple and declines to rule on this ground.

The Supreme Court has made clear that when the government takes physical possession of 

private property, there is a taking. See Koontz, 570 U.S. at 615 (noting that policy that demanded 

a “transfer [of] an interest in property from the landowner to the government . . . would amount to 

a per se taking similar to the taking of an easement or a lien”); see also Tahoe-Sierra, 535 U.S. at

322 (“When the government physically takes possession of an interest in property for some public 

purpose, it has a categorical duty to compensate the former owner . . . .”). But “statutes regulating 

the economic relations of landlords and tenants are not per se takings.” FCC v. Fla. Power Corp., 

480 U.S. 245, 252 (1987). And the California Supreme Court has determined that Nollan and 

Dolan apply only when the government requires a “property owner [to] convey some identifiable 

property interest.” Cal. Bldg. Indus. Ass’n v. City of San Jose, 351 P.3d 974, 990 (Cal. 2015).

Despite the City’s characterizations, none of the cases it cites stand for the principle that 

the property must necessarily be transferred to the government to constitute a taking. After all, in 

Nollan, it was the general public, not the government, that benefitted from the creation of a public 

easement to increase beach access. See 483 U.S. at 837. Similarly, the Ballingers have at least a 

plausible argument that although no money is transferred to the government, it is still put to public 

use because it helps to reduce rental costs and prevent displacement. Moreover, Kelo makes clear 

that the Takings Clause prohibits physical takings of real property for purely private purposes. 

See 545 U.S. at 477. But the Court ultimately need not resolve this dispute because it finds that 

the Ordinance cannot constitute a physical taking for the simpler reason that it is generally 

applicable legislation.

2. Generally Applicable Legislation

Alternatively, Oakland contends that “generally-applicable legislation is not subject to an 

exaction analysis.” Mot. at 9. The Court agrees, because the exaction doctrine exists to prevent 

the government from using its coercive power to demand unconstitutional conditions in 

adjudicative settings, not to impede the enforcement of generally applicable laws. See Koontz, 

570 U.S. at 614 (noting that “direct link between the government’s demand and a specific parcel 

of real property” led to “the risk that the government may use its substantial power and discretion 

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in land-use permitting” to exact unconstitutional conditions).

In McClung v. City of Sumner, the Ninth Circuit considered a challenge to a city ordinance 

requiring that all new developments include storm drain pipes at least 12 inches in diameter. See 

548 F.3d 1219, 1227 (9th Cir. 2008). The court applied a Penn Central regulatory takings 

analysis, after concluding that the Nollan/Dolan framework applied only to “adjudicative, 

individual determinations conditioning permit approval on the grant of property rights to the 

public” and not “general land use regulations.” Id. It noted that extending Nollan/Dolan would 

mean “subject[ing] any regulation governing development to higher scrutiny and raise the concern 

of judicial interference with the exercise of local government police powers.” Id. at 1228. 

The Ballingers argue that McClung does not apply because “it was not clear that the 

restriction at issue was actually an exaction, rather than a standard land use regulation.” Opp. at 

12. Perhaps—but the same is true here. To be sure, one court in this district has held that the 

Nollan/Dolan exaction framework applies to a city ordinance requiring a monetary payment

before an owner may withdraw a housing unit from the rental market. See Levin v. City & Cty. of 

San Francisco, 71 F. Supp. 3d 1072, 1082–83 (N.D. Cal. 2014). In so holding, Judge Breyer

found that “Koontz abrogated McClung’s holding that Nollan/ Dolan does not apply to monetary 

exactions, which is intertwined with and underlies McClung’s assumptions about legislative 

conditions.” Id. at 1083 n.4. 

But this Court finds more persuasive Judge Chhabria’s conclusion that Koontz did not 

overrule McClung. See Bldg. Indus. Ass’n—Bay Area v. City of Oakland, 289 F. Supp. 3d 1056, 

1058 (N.D. Cal. 2018). Judge Chhabria noted that “the Ninth Circuit and the California Supreme 

Court have expressly stated that a development condition need only meet the requirements 

of Nollan and Dolan if that condition is imposed as an ‘individual, adjudicative decision.’” Id.

(quoting McClung, 548 F.3d at 1227; citing Ehrlich v. City of Culver City, 911 P.2d 429, 447 (Cal. 

1996)). As noted in Building Industry Association, the “exactions doctrine . . . has historically 

been understood as a means to protect against abuse of discretion by land-use officials with 

respect to an individual parcel[] of land, and Koontz itself spoke of it in those terms.” Id. at 1058–

59. Limiting the exactions doctrine to adjudicative decisions makes sense, because it is in this 

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context that the government can most easily use its considerable power and discretion over 

permitting to extract concessions from landowners when it would otherwise be required to pay just 

compensation. 

By contrast, property owners may exercise their political power to oppose generally 

applicable legislation that regulates their property in a manner that they view as burdensome or 

unfair. See San Remo Hotel L.P. v. City & Cty. of San Francisco, 41 P.3d 87, 105 (Cal. 2002)

(“While legislatively mandated fees do present some danger of improper leveraging, such 

generally applicable legislation is subject to the ordinary restraints of the democratic political 

process.”); see also Bi-Metallic Inv. Co. v. State Bd. of Equalization, 239 U.S. 441, 445 (1915)

(Holmes, J.) (“General statutes within the state power are passed that affect the person or property 

of individuals, sometimes to the point of ruin, without giving them a chance to be heard. Their 

rights are protected in the only way that they can be in a complex society, by their power, 

immediate or remote, over those who make the rule.”). Local governments frequently pass laws 

that alter the value of property. See Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 

419, 440 (1982) (noting that the Supreme Court “has consistently affirmed that States have broad 

power to regulate housing conditions in general and the landlord-tenant relationship in particular 

without paying compensation for all economic injuries that such regulation entails” and collecting

cases). A system in which every city ordinance was subject to an unconstitutional exaction 

challenge would be unworkable. 

In sum, although it may be true that “lower courts have divided over whether the 

Nollan/Dolan test applies in cases where the alleged taking arises from a legislatively imposed 

condition rather than an administrative one,” Cal. Bldg. Indus. Ass’n v. City of San Jose, 136 S. Ct. 

928 (2016) (Thomas, J., concurring in denial of certiorari), the Ninth Circuit has provided the 

answer for this Court. The Ordinance did not constitute an unconstitutional exaction because it 

was generally applicable legislation, meaning that the Ballingers’ exaction claim fails as a matter 

of law. Accordingly, the Court need not engage in the comparatively fact-intensive analysis of 

determining whether there was a nexus and rough proportionality.

* * *

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The Court finds that the Ballingers have not, and cannot, plead an unconstitutional 

exaction claim based on the Ordinance and thus GRANTS the motion to dismiss this cause of 

action.

iii. Physical Taking

In their third cause of action, the Ballingers contend that the Ordinance is “an 

unconstitutional physical taking of property as applied to Plaintiffs,” because it forces them to 

transfer money to their tenants or otherwise “face severe financial penalties.” See FAC ¶ 67–70. 

The City argues that this cause of action must be dismissed because the Ordinance’s “requirement 

that money transfer between two private parties does not create a physical taking of that money.” 

Mot. at 14–16.5

The “classic taking” is one “in which the government directly appropriates private property 

for its own use,” Tahoe-Sierra, 535 U.S. at 324 (internal alteration and quotation omitted), such as 

when the government requires landlords to allow the installation of television cables on buildings, 

Loretto, 458 U.S. at 421. The constitutional protection against per se takings without just 

compensation applies equally to the physical appropriation of personal property as it does to real 

property. See Horne v. Dep’t of Agric., 135 S. Ct. 2419, 2426–27 (2015) (“The Government has a 

categorical duty to pay just compensation when it takes your car, just as when it takes your 

home.”).

But no precedent supports the Ballingers’ argument that legislation requiring the payment 

of money constitutes a physical taking, triggering the just compensation requirement. To the 

contrary, a plurality of Justices in Eastern Enterprises v. Apfel agreed that the Coal Act’s creation 

of an obligation to pay money to fund the health care costs of retired miners did not constitute a 

physical taking. See 524 U.S. 498, 540 (1998) (Kennedy, J., concurring) (“[The Coal Act] does 

not operate upon or alter an identified property interest . . . . The law simply imposes an 

obligation to perform an act, the payment of benefits. . . . To call this sort of governmental action 

a taking as a matter of constitutional interpretation is both imprecise and, with all due respect, 

 

5 Oakland also argued that the Ballingers failed to exhaust state-law procedures for obtaining 

compensation, Mot. at 12, but the ripeness doctrine was overruled by Knick, 139 S. Ct. at 2179.

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unwise.”); id. at 554 (Breyer, J., dissenting) (“The ‘private property’ upon which the [Takings]

Clause traditionally has focused is a specific interest in physical or intellectual property. . . . This 

case involves not an interest in physical or intellectual property, but an ordinary liability to pay 

money, and not to the Government, but to third parties.”). The courts of appeal that have 

considered this question have held that Eastern Enterprises established that “the mere imposition 

of an obligation to pay money does not give rise to a claim under the Takings Clause.” W. Va.

CWP Fund v. Stacy, 671 F.3d 378, 387 (4th Cir. 2011); see also Commonwealth Edison Co. v. 

United States, 271 F.3d 1327, 1339 (Fed. Cir. 2001) (finding that “five justices of the Supreme 

Court in Eastern Enterprises agreed that regulatory actions requiring the payment of money are 

not takings”). This Court agrees that Eastern Enterprises is the law: the obligation to pay money 

is not a taking. See Banks v. Cty. of San Mateo, No. 16-CV-04455-YGR, 2017 WL 3434113, at 

*13 (N.D. Cal. Aug. 10, 2017) (noting lack of precedent in the Ninth Circuit and following 

Eastern Enterprises to find that “the charging of fees does not constitute a violation of the Takings 

Clause”). 

Nor has the holding of Eastern Enterprise been altered by subsequent authority. Koontz

held only that monetary exactions in the permitting process were subject to Nollan/Dolan scrutiny 

because they burdened the ownership of an identifiable parcel of land. See 570 U.S. at 613–14. 

But it did not bring all general legislation requiring the transfer of money within the realm of the 

Takings Clause. The Ballingers also point to Horne, in which the Supreme Court held that “a 

governmental mandate to relinquish specific, identifiable property as a ‘condition’ on permission 

to engage in commerce effects a per se taking.” See 135 S. Ct. at 2430. But money is not specific, 

identifiable property. Rather, “[u]nlike real or personal property, money is fungible.” United 

States v. Sperry Corp., 493 U.S. 52, 62 n.9 (1989). And just because an ordinance mandates the 

transfer of wealth, that “does not convert regulation into physical invasion.” Yee, 503 U.S. at 530. 

To hold otherwise would make it impossible for state and local governments to exercise their

“broad power to regulate housing conditions in general and the landlord-tenant relationship in 

particular without paying compensation for all economic injuries that such regulation entails.” 

Loretto, 458 U.S. at 440. Finally, it is difficult to envision how exactly the City of Oakland would

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pay just compensation for an ordinance requiring the payment of money between two private 

parties.

The Court finds that the Ballingers’ physical taking claim is not cognizable and therefore 

GRANTS the motion to dismiss the third cause of action.

B. Fourth Amendment Seizure

The Ballingers’ fourth cause of action asserts that the Ordinance constitutes an 

unreasonable seizure of their money and real property. See FAC ¶¶ 74–84. The City contends 

that this cause of action must be dismissed because “[r]egulation of private activity is not state 

action,” and even if the Fourth Amendment were applicable, the seizure would not be 

unreasonable. See Mot. at 17.

Under the Fourth Amendment, a seizure “occurs when there is some meaningful 

interference with an individual’s possessory interests in that property.” Soldal v. Cook Cty., 506 

U.S. 56, 61 (1992) (internal quotation omitted). Though most familiar in the criminal context, the

Fourth Amendment’s protections also apply “in the civil context.” United States v. James Daniel 

Good Real Prop., 510 U.S. 43, 51 (1993). But the Constitution constrains only state action. Blum 

v. Yaretsky, 457 U.S. 991, 1003 (1982). And “state action requires both an alleged constitutional 

deprivation caused by the exercise of some right or privilege created by the State or by a rule of 

conduct imposed by the State or by a person for whom the State is responsible, and that the party 

charged with the deprivation must be a person who may fairly be said to be a state actor.” Am. 

Mfrs. Mut. Ins. Co. v. Sullivan, 526 U.S. 40, 50 (1999) (internal quotations omitted). 

In the Ballingers’ view, “the Ordinance forces the Ballingers and others to choose between 

one of two City-authorized seizures for tenant benefit—your home or your money—or face 

substantial penalties.” Opp. at 16. And because the City has created a “catch-22 seizure 

situation,” the logic goes, it is subject to the constraints of the Fourth Amendment. See id.

Even assuming for the sake of argument that the Ballingers have alleged a seizure of either 

their house or money, they have not met the preliminary requirement of alleging that a state actor 

caused the deprivation. The Ballingers cite a Fourth Circuit case, Presley v. City of 

Charlottesville, for the proposition that the state action requirement is met because the “City 

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authorized and compelled a seizure of money by third parties.” Opp. at 15. In Presley, trespasses 

to land committed by private citizens were attributed to the city because it knowingly published an 

erroneous map that encouraged the public to use a hiking trail that trespassed through the 

plaintiff’s property. See 464 F.3d 480, 487–88 (4th Cir. 2006). Here, by contrast, the only state 

action is the passage of the Ordinance requiring the payment of money to tenants who are evicted 

for no fault of their own. But the “subtle encouragement” of passing a law “is no more significant 

than that which inheres in the State’s creation or modification of any legal remedy,” and finding it 

to be state action would destroy the “essential dichotomy between public and private acts.” Am. 

Mfrs., 526 U.S. at 53 (internal quotation omitted). The City’s mere authorization, as opposed to 

encouragement, is not state action. See Am. Mfrs., 526 U.S. at 52; Flagg Bros., Inc. v. Brooks, 436 

U.S. 149, 164–66 (1978) (holding that actions by private actors taken pursuant to state statute are 

not state action). 

Accordingly, because the Ballingers have not alleged a constitutional deprivation at the 

hands of a state actor, the Ballingers’ Fourth Amendment claim fails as a matter of law and the 

Court GRANTS the motion to dismiss this cause of action.

C. Due Process Violation

In their fifth cause of action, the Ballingers assert that the Ordinance does not rationally 

advance any legitimate governmental interest and is arbitrary, particularly because of its 

retroactive nature, which violates the Fourteenth Amendment’s guarantee of due process. See 

FAC ¶¶ 85–95. The City moves to dismiss, asserting that the Ordinance is not retrospective and 

that it even if it was, it survives rational basis review. See Mot. at 17–20.

6

A “regulation that fails to serve any legitimate governmental objective may be so arbitrary 

or irrational that it runs afoul of the Due Process Clause.” Lingle v. Chevron U.S.A. Inc., 544 U.S. 

528, 542 (2005). “To constitute a violation of substantive due process, the alleged deprivation 

must ‘shock the conscience and offend the community’s sense of fair play and decency.’” Sylvia 

 

6

In its opening brief, the City also argued that “the due process claim is subsumed by the Takings 

Clause.” Mot. at 17. In response, the Ballingers clarify that they are bringing a substantive due 

process claim, Opp. at 17, which the City agrees is not subsumed by the Takings Clause, Reply at 

12.

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Landfield Tr. v. City of Los Angeles, 729 F.3d 1189, 1195 (9th Cir. 2013) (quoting Marsh v. Cty. 

of San Diego, 680 F.3d 1148, 1154 (9th Cir. 2012)). A law is not retroactive just because it 

“upsets expectations based in prior law,” but only if it “attaches new legal consequences to events 

completed before its enactment.” Landgraf v. USI Film Prods., 511 U.S. 244, 269–70 (1994). 

But even “[r]etrospective economic legislation need only survive rational basis review in order to 

pass constitutional muster.” Gadda v. State Bar of Cal., 511 F.3d 933, 938 (9th Cir. 2007); see 

also Gen. Motors Corp. v. Romein, 503 U.S. 181, 191 (1992).

The Ballingers’ substantive due process claim fails as a matter of law because they do not 

meet the “extremely high” burden, Richardson v. City & Cty. of Honolulu, 124 F.3d 1150, 1162 

(9th Cir. 1997), of showing that the Ordinance is arbitrary and irrational. First, the Ordinance is 

not retrospective, because although it upset the Ballingers’ expectations about the costs of evicting 

their tenants, it does not attach any new legal consequences to events completed before its 

passage. See Franceschi v. Yee, 887 F.3d 927, 940 (9th Cir. 2018) (holding that statute revoking 

driver’s licenses for failure to pay past-due taxes did not operate retroactively because it was 

“dependent on a taxpayer’s current conduct . . . and not on past conduct”). Second, the Ordinance 

passes rational basis review, regardless of whether it acts retroactively. The City Council’s 

legislative purpose, to promote community stability and help tenants avoid displacement and high 

moving costs, was a legitimate one. See Pennell v. City of San Jose, 485 U.S. 1, 12–13 (1988)

(holding that protection of tenants is legitimate governmental purpose); Apartment Ass’n of 

Greater L.A. v. City of Beverly Hills, No. CV 18-6840 PSG (EX), 2019 WL 1930136, at *7 (C.D. 

Cal. Apr. 17, 2019) (upholding challenge to relocation payment ordinance against substantive due 

process challenge). And the Ordinance is rationally related to that legitimate end because it shifts 

some of the costs of relocation from tenants evicted for no fault of their own onto their landlords 

based on the size of the rental property and the duration of the tenant’s occupancy. Cf. 

Guggenheim v. City of Goleta, 638 F.3d 1111, 1122 (9th Cir. 2010) (en banc) (upholding rent 

control ordinance against substantive due process challenge). Thus, the Ballingers have not 

satisfied the extremely high bar of showing that the duly-passed Ordinance shocks the conscience 

so as to violate their substantive due process rights.

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The Court GRANTS the motion to dismiss the due process claim because it concludes that 

the Ballingers have not pled any facts to reasonably support the conclusion that the Ordinance is 

impermissibly retroactive, arbitrary, or irrational.

D. Contract Clause

The Ballingers’ sixth and final cause of action asserts that the Ordinance violates the

Constitution’s Contract Clause. FAC ¶¶ 96–104.

The Contract Clause provides that “[n]o State shall . . . pass any . . . Law impairing the 

Obligation of Contracts.” U.S. Const. art. I, § 10, cl. 1. The “Contract Clause limits the power of 

the States to modify their own contracts as well as to regulate those between private parties” but 

“does not prohibit the States from repealing or amending statutes generally, or from enacting 

legislation with retroactive effects.” U.S. Tr. Co. of N.Y. v. New Jersey, 431 U.S. 1, 17 (1977). 

The Clause is “narrowly construe[d]” in order “to ensure that local governments can effectively 

exercise their police powers.” S. Cal. Gas Co. v. City of Santa Ana, 336 F.3d 885, 889 (9th Cir. 

2003).

 To assess whether “laws affecting pre-existing contracts violate the Clause,” courts 

engage in a two-step inquiry. Sveen v. Melin, 138 S. Ct. 1815, 1821 (2018). First, courts 

determine whether the state law has “operated as a substantial impairment of a contractual 

relationship.” Allied Structural Steel Co. v. Spannaus, 438 U.S. 234, 244 (1978). This step 

includes considering “the extent to which the law undermines the contractual bargain, interferes 

with a party’s reasonable expectations, and prevents the party from safeguarding or reinstating his 

rights.” Sveen, 138 S. Ct. at 1822. And “when considering substantial impairment, [courts] focus 

on the importance of the term which is impaired, not the dollar amount.” S. Cal. Gas Co., 336 

F.3d at 892. Second, if there is substantial impairment, courts look to the “means and ends of the 

legislation,” Sveen, 138 S. Ct. at 1822, including whether there is a “significant and legitimate 

public purpose behind the regulation,” Energy Reserves Grp., Inc. v. Kan. Power & Light Co., 459 

U.S. 400, 411 (1983). When the government is not a party to the contract, courts must “defer to 

legislative judgment as to the necessity and reasonableness of a particular measure.” Id. at 413

(internal quotation omitted).

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The Court finds that the Ordinance does not substantially impair the agreement between 

the Ballingers and their tenants. Tellingly, the Ballingers are not able to muster any precedent to 

support their arguments. And given the “existence of extensive regulation” of the landlord-tenant 

relationship, the Ballingers could not reasonably have expected the regulatory landscape to remain 

unchanged indefinitely. See id. at 416 (finding no impairment of reasonable expectations where 

parties recognized “existence of extensive regulation” in field); see also Rancho de Calistoga, 800 

F.3d at 1091 (noting that “those who do business in a regulated field cannot object if the 

legislative scheme is buttressed by subsequent amendments to achieve the legislative end”) 

(internal quotation and alterations omitted); Chi. Bd. of Realtors, Inc. v. City of Chicago, 819 F.2d 

732, 737 (7th Cir. 1987) (considering extent of prior landlord-tenant regulation and denying 

motion for preliminary injunction on Contract Clause claim). After all, when they leased their 

house, the Ballingers would have been required to make a relocation payment to a tenant they 

evicted under the Ellis Act. The Ordinance simply extended this obligation to include no-fault 

evictions for owner move-ins. And the Ordinance does not prohibit owner move-ins, it just 

redistributes the costs so that tenants are not forced to bear the full financial brunt of being evicted. 

Thus, the relocation payment is not a “ransom requirement,” Opp. at 21, but merely one more 

regulation added to the stack of those governing the relationship between Oakland landlords and 

their tenants.

The Court finds that the Ballingers have not alleged a substantial impairment of their 

contractual relationship and thus GRANTS the motion to dismiss the Contract Clause cause of 

action.

E. Standing to Pursue Injunctive or Declaratory Relief

Oakland contends that the Ballingers lack standing to pursue either injunctive or 

declaratory relief and that these claims for relief must be dismissed. Mot. at 22–23. The 

Ballingers do not respond to this argument.

A plaintiff “must show standing with respect to each form of relief sought.” Ellis v. 

Costco Wholesale Corp., 657 F.3d 970, 978 (9th Cir. 2011). To establish standing, a plaintiff 

“must have suffered an injury-in-fact that is fairly traceable to the challenged conduct and that is 

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likely to be redressed by a favorable judicial decision.” California v. Azar, 911 F.3d 558, 570 (9th 

Cir. 2018). And when a plaintiff seeks prospective injunctive relief, he must establish “a real and 

immediate threat of repeated injury” so as to show “a sufficient likelihood that he will again be 

wronged in a similar way.” Bates v. United Parcel Serv., Inc., 511 F.3d 974, 985 (9th Cir. 2007)

(quotations omitted).

Given that the Ballingers did not oppose this ground for dismissal, and the Court has 

dismissed the substantive claims, the Court declines to rule on whether the Ballingers have 

adequately pled standing to pursue injunctive or declaratory relief.

IV. CONCLUSION

The Court finds that the Ballingers have failed to plead a cognizable legal theory on any of 

their constitutional challenges to the Ordinance and thus GRANTS the motion to dismiss. 

Further, the Court grants the motion without leave to amend because it finds that leave would be 

futile, as counsel for the Ballingers acknowledged at the hearing that the factual underpinnings are 

not disputed. Of course, in granting this motion, the Court does not opine on the wisdom or the 

effectiveness of the Ordinance in alleviating what is undoubtedly a housing crisis in the Bay Area. 

Cf. Miralle v. City of Oakland, No. 18-CV-06823-HSG, 2018 WL 6199929, at *4 (N.D. Cal. Nov. 

28, 2018) (noting that “the question before the Court is not whether the City’s policy approach” to 

addressing the “homelessness crisis” is “the ideal policy approach”). But the Ballingers lack a 

cognizable legal claim for the reasons discussed above, and that finding ends the Court’s inquiry 

here.

The Clerk is directed to close the case and enter judgment in favor of Defendants.

IT IS SO ORDERED.

Dated: 8/2/19

______________________________________

HAYWOOD S. GILLIAM, JR.

United States District Judge

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