Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_05-cv-02886/USCOURTS-cand-4_05-cv-02886-3/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

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

BESARO MOBILE HOME PARK, LLC,

Plaintiff,

v.

CITY OF FREMONT,

Defendant.

 /

No. C 05-2886 CW

ORDER GRANTING

DEFENDANT'S

MOTION TO DISMISS

Defendant City of Fremont (Fremont) moves pursuant to Rules

12(b)(1) and 12(b)(6) to dismiss the complaint of Besaro Mobile

Home Park (Besaro). Besaro opposes the motion, and the matter was

taken under submission on the papers. Having considered all of the

papers filed by the parties, the Court GRANTS without prejudice

Fremont's motion to dismiss. 

BACKGROUND

Unless otherwise noted, the following facts are drawn from

Besaro’s amended complaint and are presumed to be true. 

Besaro is the owner of a mobile home park in Fremont. 

Besaro’s tenants own their own mobile homes, but rent the

underlying mobile home spaces. Besaro provides its tenants with

access to facilities and amenities, such as a clubhouse, swimming

pool, utilities and landscaping. As early as 1999, it has been

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1

Fremont requests that the Court take judicial notice of the

text of Fremont's current rent control law and the relevant

Ordinances. Besaro does not oppose the request for judicial

notice. Because Fremont’s vacancy control laws are integral to the

complaint and are not reasonably subject to dispute, the Court

grants the request for judicial notice. 

2

common knowledge that mobile homes and mobile home spaces are

complementary goods. 

In 1992, Fremont adopted a vacancy control ordinance that

significantly limited rent increases for mobile home park tenants. 

See Def.’s Req. for Judicial Not., Ex. C, Fremont, Cal., Ordinance

No. 2018 (Nov. 10, 1992).1 The 1992 Ordinance did not provide for

any rent increase upon a vacancy. 

In 1999, Fremont retained an economic consultant to study the

relationship between increases in mobile home prices and decreases

in mobile home space rents. The consultant concluded that in most

cases, a $100 decrease in rent would result in a $10,000 increase

in the price of a mobile home. (Otherwise, a mobile home is a

depreciating asset.) 

On July 25, 2000, Fremont, through its City Council, adopted

Ordinance No. 2390, which amended Fremont’s rent control law.

Ordinance No. 2390 provided that mobile park owners such as Besaro

could raise rents by no more than fifteen percent following the

sale of a mobile home by an outgoing tenant to an incoming tenant

at any time between January 1, 2002 and December 31, 2019. 

However, no restrictions are placed on the sale price of a mobile

home from an outgoing tenant to an incoming tenant. Fremont took

this action despite knowing that outgoing tenants would be able to

sell their mobile homes to incoming tenants at above-market rates,

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thereby capturing a premium as a result of the controlled rent. 

The 2000 amendment does allow mobile park owners to raise rents to

the market level where there has been a lawful eviction, or where a

commercial purchaser replaces a mobile home. Prior to the

enactment of Ordinance 2390, Fremont had never indicated that it

planned to continued to control mobile home park rents through

2019. The 2000 amendment did not alter the stated purpose of

Fremont’s rent control law, which is to “protect the mobile home

owners from unreasonable rent increases and other abusive or

disruptive practices by park owners.” Def.’s Req. for Judicial

Not., Ex. A, Fremont, Cal., Code § 3-13101(h). Nor did it amend

any of the City Council’s 1992 findings, such as that Fremont has a

shortage of developed spaces for mobile homes or that this

condition “has contributed or threatens to contribute to”

unreasonable rent increases for mobile home spaces. Id. § 3-

13101(a, f). 

According to Besaro’s allegations, the purpose of Ordinance

No. 2390 is not to eliminate blight, rejuvenate the economy, create

employment or housing opportunities, or otherwise benefit the

public. Instead, the Fremont City Council enacted Ordinance No.

2390 “with the intent of obtaining the votes of the residents at

the parks.” Am. Compl. ¶ 22. 

Besaro alleges that it has no administrative remedies

available because it has already applied for and received the

maximum rent increase permitted under the amended law. 

Besaro brings claims against Fremont for: (1) taking of

property “without payment of just compensation and/or due process

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of law” in violation of the Fifth and Fourteenth Amendments of the

United States Constitution and 42 U.S.C. § 1983; (2) taking of

property in violation of the California Constitution; and

(3) declaratory relief. The parties entered into an agreement

which tolled the statute of limitations with respect to these

claims for the period of July 24, 2001 through and including July

15, 2005, when Besaro filed this lawsuit. 

LEGAL STANDARD

I. Rule 12(b)(1)

Dismissal is appropriate under Rule 12(b)(1) when the district

court lacks subject matter jurisdiction over the claim. Fed. R.

Civ. P. 12(b)(1). Federal subject matter jurisdiction must exist

at the time the action is commenced. Morongo Band of Mission

Indians v. Cal. State Bd. of Equalization, 858 F.2d 1376, 1380 (9th

Cir. 1988), cert. denied, 488 U.S. 1006 (1989). A Rule 12(b)(1)

motion may either attack the sufficiency of the pleadings to

establish federal jurisdiction, or allege an actual lack of

jurisdiction which exists despite the formal sufficiency of the

complaint. Thornhill Publ’g Co. v. Gen. Tel. & Elecs. Corp., 594

F.2d 730, 733 (9th Cir. 1979); Roberts v. Corrothers, 812 F.2d

1173, 1177 (9th Cir. 1987).

Subject matter jurisdiction is a threshold issue which goes to

the power of the court to hear the case. Therefore, a Rule

12(b)(1) challenge should be decided before other grounds for

dismissal, because they will become moot if dismissal is granted. 

Alvares v. Erickson, 514 F.2d 156, 160 (9th Cir.), cert. denied,

423 U.S. 874 (1975).

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A federal court is presumed to lack subject matter

jurisdiction until the contrary affirmatively appears. Stock West,

Inc. v. Confederated Tribes, 873 F.2d 1221, 1225 (9th Cir. 1989). 

An action should not be dismissed for lack of subject matter

jurisdiction without giving the plaintiff an opportunity to amend

unless it is clear that the jurisdictional deficiency cannot be

cured by amendment. May Dep’t Store v. Graphic Process Co., 637

F.2d 1211, 1216 (9th Cir. 1980). Absent an independent basis, the

agreement of the parties does not confer subject matter

jurisdiction. Brockman v. Merabank, 40 F.3d 1013, 1017 (9th Cir.

1994).

II. Rule 12(b)(6)

A motion to dismiss for failure to state a claim will be

denied unless it is “clear that no relief could be granted under

any set of facts that could be proved consistent with the

allegations.” Falkowski v. Imation Corp., 309 F.3d 1123, 1132 (9th

Cir. 2002), citing Swierkiewicz v. Sorema N.A., 534 U.S. 506

(2002). All material allegations in the complaint will be taken as

true and construed in the light most favorable to the plaintiff. 

NL Indus., Inc. v. Kaplan, 792 F.2d 896, 898 (9th Cir. 1986). 

Although the court is generally confined to consideration of the

allegations in the pleadings, when the complaint is accompanied by

attached documents, such documents are deemed part of the complaint

and may be considered in evaluating the merits of a Rule 12(b)(6)

motion. Durning v. First Boston Corp., 815 F.2d 1265, 1267 (9th

Cir. 1987).

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DISCUSSION

I. Ripeness

Fremont moves to dismiss the complaint under Rule 12(b)(1) on

the ground that the Court lacks jurisdiction because the FAC makes

a federal claim for unlawful taking without compensation, and this

is not ripe because Besaro has not yet sought a remedy in State

court. 

In order to determine whether a claim under the Takings Clause

is ripe for adjudication in federal court, the Court performs a

two-step inquiry: “The plaintiff must have obtained a final

decision from the governmental authority charged with implementing

the regulations and must have pursued compensation through state

remedies unless doing so would be futile.” Hacienda Valley Mobile

Estates v. City of Morgan Hill, 353 F.3 651, 655 (9th Cir. 2003)

(citing Williamson County Regional Planning Comm’n v. Hamilton

Bank, 473 U.S. 172, 186 (1985)). The Supreme Court has explained

the second prong as follows,

The Fifth Amendment does not proscribe the taking of property;

it proscribes taking without just compensation. Nor does the

Fifth Amendment require that just compensation be paid in

advance of, or contemporaneously with, the taking; all that is

required is that a reasonable, certain and adequate provision

for obtaining compensation exist at the time of the taking. 

If the government has provided an adequate process for

obtaining compensation, and if resort to that process yield[s]

just compensation, then the property owner has no claim

against the Government for a taking. Thus, . . . if a State

provides an adequate procedure for seeking just compensation,

the property owner cannot claim a violation of the Just

Compensation Clause until it has used the procedure and been

denied just compensation.

Williamson, 473 U.S. at 194-95 (internal citations and quotation

marks omitted). Therefore, a plaintiff “cannot bring a section

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1983 action in federal court until the state denies just

compensation.” Levald, Inc., v. City of Palm Desert, 998 F.2d 680,

687 (9th Cir. 1993). In Ventura Mobilehome Communities Owners

Ass’n v. City of San Buenaventura, 371 F.3d 1046, 1053 (9th Cir.

2004), the Ninth Circuit affirmed a dismissal for lack jurisdiction

where a takings claim was not ripe because the plaintiff had not

filed suit for damages in State court, among other potential

remedies. 

An exception to the ripeness requirement exists for Takings

Clause claims which challenge a regulation on its face, rather than

as applied. A facial challenge to an alleged regulatory taking

“does not depend on the extent to which petitioners are deprived of

the economic use of their particular pieces of property or the

extent to which these particular petitioners are compensated.” Yee

v. City of Escondido, 503 U.S. 519, 534 (1992). Therefore, the

ripeness requirement that the plaintiff first seek compensation

does not apply. Id.; Ventura Mobilehomes, 371 F.3d at 1054. 

Besaro’s primary argument is that its federal claim is a ripe

facial challenge because it is based on the regulation’s failure to

promote a legitimate State interest rather than its failure to

provide park owners with just compensation. Besaro’s argument is

inconsistent with the allegations in the FAC, which repeatedly

refer to Besaro’s “right to be justly compensated.” E.g., FAC

¶ 40. If Ordinance No. 2390 was, as Besaro now argues, a purely

private taking with no legitimate public justification, then

whether Besaro was justly compensated would be irrelevant to the

issue of constitutionality. In the interests of judicial

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2The bases for Besaro’s federal claim are written in the

alternative: “the taking of Plaintiff’s property without a valid

public purpose and/or without the payment of just compensation

and/or without due process of law.” FAC ¶ 35. The federal claim

does not specifically refer to the “Takings” or “Just Compensation”

Clause. Besaro apparently intends also to state a claim for

deprivation of substantive due process, as an alternative to a

claim for unconstitutional taking without just compensation. 

However, Besaro fails to respond to Fremont’s argument (see Mot. to

Dismiss at 7 n.3) that a generalized substantive due process claim

is not cognizable. Because the Takings Clause of the Fifth

Amendment provides an explicit textual provision under which the

constitutionality of Fremont's rent control ordinance can be

analyzed, Besaro's challenge must be brought under the Takings

Clause and not under the more general guarantee of substantive due

process. See Armendariz v. Penman, 75 F.3d 1311, 1325-26 (9th Cir.

1996) (“Substantive due process analysis has no place in contexts

already addressed by explicit textual provisions of constitutional

protection”); Macri v. King County, 126 F.3d 1125, 1128-29 (9th

Cir. 1997) (applying Armendariz to bar substantive due process

claim where Takings Clause provides explicit constitutional

protection); Besaro Mobile Home Park v. City of Fremont, 1997 WL

818584, *4-5 (N.D. Cal. Dec. 19, 1997) (dismissing on this ground

Besaro’s substantive due process claim in related case), aff'd, 166

F.3d 342 (9th Cir. 1998). 

8

efficiency, however, the Court will assume that Besaro intended to

bring only a facial challenge to the Ordinance, and will not

require Besaro to amend its pleadings to clarify that issue.2 (For

the reasons set forth in Section II, however, any facial challenge

is barred by the statute of limitations.) 

Besaro also suggests that even if the Williamson ripeness test

is applicable, its federal claim meets the second prong of the test

because it has already applied for and received the largest rent

increase allowable under the 2000 amendment. See Pl.’s Opp. to

Mot. to Dismiss at n.5 (citing Austin v. City and County of

Honolulu, 840 F.2d 678, 680 (9th Cir. 1988)). However, Besaro has

not challenged Ordinance No. 2390 in State court and does not show

that such a challenge would be futile. Cf. Hacienda Valley Mobile

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Estates, 353 F.3d at 658-61 (finding that challenge to rent control

ordinance in California State courts would not be futile). 

Therefore, to the extent Besaro is seeking to bring an asapplied challenge to the Ordinance, that claim is dismissed without

prejudice to refiling once it is ripe for review. Any federal

substantive due process claim is dismissed with leave to file a

Second Amended Complaint (SAC) if Besaro can allege, truthfully and

without contradicting the FAC, a claim that cannot be analyzed

under the Takings Clause or other explicit constitutional

provision. 

II. Statute of Limitations

Fremont moves to dismiss the complaint on the grounds that the

first claim is barred by the applicable statute of limitations. 

In most cases, a Takings Clause cause of action accrues when

the plaintiff is denied just compensation. Levald, 998 F.2d at

687. Where, however, a plaintiff brings a facial challenge under

the Takings Clause, “the cause of action accrues and the

limitations period begins to run upon the enactment of the

statute.” Id. 

The parties dispute the relevant date of enactment for

purposes of the statute of limitations. Fremont argues that

Besaro’s facial takings claim accrued in 1992, when the city

reinstated a full vacancy control ordinance. Besaro argues that

its claim accrued in 2000, when the ordinance was amended to

provide for limited rent increases upon vacancies and to exempt

from regulation purchases of mobile homes from commercial sellers

or after eviction. 

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Besaro’s theory is flawed because the 2000 Ordinance differs

from the 1992 Ordinance only in that it provides mobile home park

owners with opportunities for larger rent increases and for raising

rents in a greater number of circumstances. In De Anza Props. X,

Ltd., v. County of Santa Cruz, 936 F.2d 1084, 1086-87 (9th Cir.

1991), the court rejected a similar argument regarding the date of

accrual of the limitations period where a second enactment, which

extended vacancy controls already in place, did not substantively

change its impact upon mobile home park owners. 

Besaro nevertheless claims that a new cause of action accrued

with the passage of the 2000 Ordinance because at that time (in

contrast to 1992) there allegedly were no excessive rents in

Fremont. However, this argument is inconsistent with Besaro’s

purported facial challenge to the ordinance. Indeed, if Besaro’s

argument were adopted and taken to its logical conclusion, any time

a rent control ordinance succeeded in its purpose (here, by

eliminating excessive rents), a new facial takings cause of action

for landowners would accrue. In Hacienda Valley Mobile Estates,

353 F.3d at 656, the Ninth Circuit explained that a mobile park

owner could bring a challenge to the premiums created by a rent

control ordinance either as a facial challenge “by attacking only

the laws” or as an as-applied challenge based on outside economic

factors. Here, the portions of the ordinance which allegedly

result in a taking from Besaro were not new in 2000; according to

Besaro, at that time Fremont should have eliminated, rather than

merely amended, its rent control ordinance. Besaro’s current

pleading of changed economic circumstances necessarily transforms

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its attack on vacancy control from a facial to an as-applied

challenge. As described above in Section I above, Besaro cannot

bring an as-applied challenge to Fremont’s rent control laws until

it has first sought remedies in State court. 

Besaro also broadly asserts that any statute of limitations

argument must fail because “no amount of time can save an ordinance

that is otherwise unconstitutional.” Pl.’s Opp. to Mot. to Dismiss

at 11 (citing Palazzolo v. Rhode Island, 533 U.S. 606 (2001)). In

Palazzolo, the Supreme Court addressed the issue of notice for an

owner who purchased property that was potentially subject to a

unripened Takings Clause claim. Besaro offers no justification for

reading Palazzolo to abrogate those cases in which a statute of

limitations is applied to bar a Takings Clause claim which accrued

upon enactment of a statute or ordinance. See, e.g., De Anza, 936

F.2d at 1085 (holding that facial challenge that accrued when

ordinance was enacted was time-barred). Nor does Besaro argue that

the limitations period should run from any date other than

enactment. 

For these reasons, to the extent that Besaro does seek to

bring a facial challenge to Fremont’s vacancy control ordinance,

the Court finds that the cause of action accrued when a vacancy

control ordinance was passed in 1992, and therefore statute of

limitations now bars the action. Besaro is granted leave to file a

SAC if it can allege, truthfully and without contradicting the

original complaint, a facial challenge under the Takings Clause

that accrued as a result of the 2000 enactment of Ordinance No.

2390. 

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III. Valid Public Purpose

Even if Besaro’s claim were ripe, or were not subject to the

Williamson ripeness inquiry, and was not time-barred, it would

still be dismissed for failure to state a claim. 

The Takings Clause pertains to property taken by government

“for public use.” However, “the Constitution forbids even a

compensated taking of property when executed for no reason other

than to confer a private benefit on a particular private party.” 

Hawaii Housing Authority v. Midkiff, 467 U.S. 229, 245 (1984). 

According to Besaro’s opposition, the premise of its Takings Clause

challenge is that Ordinance No. 2390 was not enacted for any public

purpose, but to win the votes of those who owned a mobile home at

the time of its enactment. Besaro acknowledges that rent control

ordinances may be adopted for permissible public purposes. As

Besaro notes, one permissible purpose may be to “restore free

market conditions” to a monopolistic or oligopolistic housing

market. Oceanside Mobilehome Park Owners’ Ass’n v. City of

Oceanside, 157 Cal. App. 3d 887, 905 (1984). However, courts have

recognized other potentially legitimate purposes of mobile home

rent control: “to alleviate hardship created by rapidly escalating

rents; to protect owners’ investments in their mobile homes; to

equalize the bargaining power of park owners and tenants; and to

protect tenants from unconscionable and coercive changes in rental

rates.” Levald, 998 F.2d at 690 (citing Pennell v. City of San

Jose, 485 U.S. 1, 13-14 (1988)). The Supreme Court has recently

clarified that courts need not determine, for Takings Clause

claims, whether a regulation “substantially advances” its stated

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purpose, explaining that courts are not required to scrutinize the

efficicacy of regulations. Lingle v. Chevron U.S.A., Inc., 544

U.S. 528, 544 (2005). 

Besaro makes two allegations to support its claim that

Ordinance No. 2390 lacks any public purpose. First, Besaro alleges

that at the time of enactment, there were no excessive rents

charged in mobile home parks in Fremont. Second, Besaro alleges

that Ordinance No. 2390 creates an irrational “two-tiered system”

whereby outgoing residents are able to sell mobile homes at abovemarket rates to incoming residents who then enjoy below-market rent

on their park space, but incoming purchasers pay market rents where

there has been a lawful eviction or where a commercial purchaser

replaces a mobile home. 

These allegations are insufficient to state a claim that the

2000 amendment lacked a public purpose. Because Fremont already

had a rent control ordinance in effect in 2000, the fact that there

were no excessive rents charged in Fremont mobile parks at that

time, if proved, could just as easily show that Fremont’s ordinance

was fulfilling its public purpose to prevent excessive rents. The

fact that outgoing mobile home owners receive a windfall does not

necessarily mean that Fremont’s Ordinance No. 2390 does not have a

public purpose. See Ventura Mobilehome, 371 F.3d at 1055 (finding

mobile home rent control ordinance was rationally related to a

legitimate State interest despite allegation that it conferred a

premium on renters by artificially inflating the value of mobile

homes). Similarly, the fact, if proved, that purchasers of new

mobile homes or mobile homes vacated due to eviction do not receive

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the same benefit from the ordinance as do re-sale purchasers goes

to the efficicacy rather than the purpose of Fremont’s ordinance. 

It may show that the ordinance’s class of beneficiaries is too

narrow, but not that the stated purpose of the law is a sham. 

The Court is therefore left with Besaro’s conclusory assertion

that the Fremont City Council adopted Ordinance No. 2390 in order

to win the votes of current mobile home residents. Standing alone,

this allegation is nonsensical. Among its other new provisions,

Ordinance No. 2390 enabled mobile park owners to raise rents upon a

vacancy, albeit subject to limitations. If, as Besaro alleges,

there is a relationship between mobile home prices and mobile home

space rents, then Ordinance No. 2390 would have reduced the likely

resale value of mobile homes. Besaro does not allege that

Fremont’s city council would otherwise have terminated its rent

control ordinance; in fact, the 1992 Ordinance specified that it

would remain in place until repealed by the city council. Req. for

Judicial Not, Ex. C, Ordinance No. 2018 § 13118(a). Moreover, as

long as Fremont did have a legitimate public purpose in adopting

Ordinance No. 2390, the fact that it may have also had a subjective

intent to win the favor of current mobile home residents would not

render the law unconstitutional. 

For this reason, if Besaro chooses to file a SAC, in order to

state a Takings Clause claim based on a lack of public purpose, it

must include additional, non-conclusory allegations to support its

claim that Fremont lacked any public purpose when it enacted

Ordinance No. 2390. 

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CONCLUSION

For the foregoing reasons, Fremont's motion to dismiss is

GRANTED (Docket No. 14). The Court also GRANTS Fremont’s request

for judicial notice (Docket No. 15). Besaro is granted leave to

file a SAC within twenty days of the date of this order, if it can

do so truthfully and without contradicting the FAC, in accordance

with the instructions above.

IT IS SO ORDERED.

7/10/06

Dated: CLAUDIA WILKEN

UNITED STATES DISTRICT JUDGE

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