Court Opinion

ID: 9430373
Source: CourtListenerOpinion
Date Created: 2023-08-02 23:29:36.298834+00
Date Added: 2024-06-11T17:23:24.230482
License: Public Domain

Justice Powell,
concurring in the judgment.
The Court today reaches out to decide a difficult preemption question when a straightforward and well-settled ground for decision is available. In my view, Berkeley’s Ordinance plainly falls within the “state action” exemption of Parker v. Brown, 317 U. S. 341 (1943), and its progeny. I therefore concur in the judgment, but on grounds different from those discussed in the Court’s opinion.
*271When a municipal government engages in anticompetitive activity pursuant to a clearly articulated state policy to displace competition with regulation, the “state action” exemption removes the conduct from the coverage of the antitrust laws. Hallie v. Eau Claire, 471 U. S. 34, 38-39 (1985); Community Communications Co. v. Boulder, 455 U. S. 40, 54 (1982). In Hallie, we found such a policy embodied in a state statute that “delegated to [municipalities] the express authority to take action that foreseeably will result in anti-competitive effects.” 471 U. S., at 43. See also Lafayette v. Louisiana Power & Light Co., 435 U. S. 389, 415 (1978) (opinion of Brennan, J.) (“[A]n adequate state mandate for anticompetitive activities . . . exists when it is found ‘from the authority given a governmental entity to operate in a particular area, that the legislature contemplated the kind of action complained of’”) (citation omitted). Thus, the question in this case is whether California has expressly delegated to Berkeley regulatory power that foreseeably would lead to the anticompetitive effects challenged by appellants.
The history of Berkeley’s ordinance is illuminating. Prior to 1974, Article XI, §3, of the California Constitution1 required the state legislature to approve all changes in municipal charters. In 1972, in a citywide initiative, Berkeley’s citizens approved a charter amendment authorizing rent *272control. This charter amendment effectively froze rents at 1971 levels, subject to individual adjustments by a popularly elected rent control board. Birkenfeld v. City of Berkeley, 17 Cal. 3d 129, 138, 550 P. 2d 1001, 1008 (1976). The California Legislature ratified the charter amendment on August 2, 1972, and the rent control plan went into effect. 1972 Cal.Stat. 3370. A group of landlords challenged the rent control plan on a number of constitutional and statutory grounds. In the ensuing litigation, the California Supreme Court invalidated the plan on the ground that it lacked procedural safeguards necessary to protect landlords from confiscatory rent ceilings.2 Birkenfeld, supra, at 170-172, 550 P. 2d, at 1030-1032. In 1980, in another initiative, Berkeley’s citizens adopted the ordinance at issue in this case. This Ordinance provided the procedural protections that the 1972 charter provision lacked, and it subsequently survived constitutional challenge in state court. 37 Cal. 3d 644, 679-691, 693 P. 2d 261, 289-298 (1984).
The challenged Ordinance thus replaces a rent control plan that was expressly authorized by the state legislature. Under Hallie, a general grant of authority to regulate rents would have sufficed to exempt Berkeley’s Ordinance from the antitrust laws. 471 U. S., at 42. It follows that the legislature’s ratification of a particular rent control plan must also trigger the state-action exemption. See ibid.; Boulder, supra, at 55-56. The remaining issue is whether the authority granted in 1972 remains intact.
Appellants contend that it does not. First, appellants argue that the California Supreme Court’s decision in Birken-*273feld, invalidating the 1972 charter provision, effectively canceled the legislature’s ratification of that provision. Birkenfeld did not, however, decide that rent control was bad policy, or that it was inconsistent with state law. See Birkenfeld, supra, at 159-164, 550 P. 2d, at 1023-1026 (finding that enacting a rent control plan was a permissible exercise of the city’s police power); Note, 65 Calif. L. Rev. 304, 305 (1977) (“Birkenfeld offers California cities. . . the judicial equivalent of a rent control enabling act”). Rather, the decision stands only for the proposition that cities must couple rent control with procedures for adjusting rent ceilings to avoid fixing rents at confiscatory levels. 17 Cal. 3d, at 167-173, 550 P. 2d, at 1028-1033. Birkenfeld thus left Berkeley’s basic power to impose rent controls unaffected.
Second, appellants contend that since 1972 the state legislature has declared its neutrality respecting a city’s decision to control rents. See Boulder, supra, at 55 (clear articulation requirement is not satisfied “when the State’s position is one of mere neutrality respecting the municipal actions challenged as anticompetitive”). This argument rests on the passage in 1980 of a comprehensive planning and zoning law, one provision of which states:
“Nothing in this article shall be construed to be a grant of authority or a repeal of any authority which may exist of a local government to impose rent controls or restrictions on the sale of real property.” Cal. Govt. Code Ann. § 65589(b) (West 1983) (emphasis added).
By its express terms this statute leaves intact cities’ preexisting authority to adopt rent control provisions. For purposes of the clear articulation requirement, Berkeley’s preexisting authority is defined by the legislature’s ratification of the city’s 1972 charter amendment.
For these reasons, I would find that Berkeley’s Ordinance is exempt from the antitrust laws under our decisions in Hallie and Boulder. By ratifying Berkeley’s charter amendment, the state legislature expressly authorized Berkeley to *274control rents. The State has not since rescinded that authorization. That is all we need decide in this case.
I therefore concur in the judgment, and express no view on the merits of the pre-emption issue decided by the Court.

 When Berkeley’s charter amendment was passed in 1972, Article XI, § 3(a), of the California Constitution read:
“For its own government, a county or city may adopt a charter by majority vote of its electors voting on the question. The charter is effective when filed with the Secretary of State. A charter may be amended, revised, or repealed in the same manner. A charter, amendment, revision, or repeal thereof shall be published in the official state statutes. . . . The provisions of a charter are the law of the State and have the force and effect of legislative enactments.”
This provision was construed to require that charter amendments be approved by concurrent resolution of both houses of the state legislature. Birkenfeld v. City of Berkeley, 17 Cal. 3d 129, 137, n. 2, 550 P. 2d 1001, 1007, n. 2 (1976).

 The 1972 charter provision permitted individual adjustments of the across-the-board rent ceiling only on a unit-by-unit basis, and only after a hearing on the particular unit whose rent was to be raised. The California Supreme Court found that this limitation “put the [rent control board] in a procedural strait jacket,” and “unnecessarily preelude[d] reasonably prompt action” on meritorious petitions by landlords. Birkenfeld, supra, at 171, 172, 550 P. 2d, at 1031, 1032.