Court Opinion

ID: 4672343
Source: CourtListenerOpinion
Date Created: 2021-03-29 15:00:53.086677+00
Date Added: 2024-06-11T09:02:23.686511
License: Public Domain

RECOMMENDED FOR PUBLICATION
                               Pursuant to Sixth Circuit I.O.P. 32.1(b)
                                      File Name: 21a0074p.06

                    UNITED STATES COURT OF APPEALS
                                  FOR THE SIXTH CIRCUIT

                                                            ┐
 TIGER LILY, LLC, et al.,
                                                            │
                                  Plaintiff-Appellees,      │
                                                             >        No. 21-5256
                                                            │
        v.                                                  │
                                                            │
                                                            │
 UNITED STATES DEPARTMENT OF HOUSING AND                    │
 URBAN DEVELOPMENT, et al.,                                 │
                                                            │
                            Defendants-Appellants.
                                                            ┘

      On Emergency Motion for Stay Pending Appeal and Immediate Administrative Stay.
        United States District Court for the Western District of Tennessee at Memphis;
                   No. 2:20-cv-02692—Mark S. Norris Sr., District Judge.

                              Decided and Filed: March 29, 2021

                    Before: NORRIS, THAPAR, and BUSH, Circuit Judges.
                                  _________________

                                           COUNSEL

ON MOTION AND REPLY: Alisa B. Klein, Brian J. Springer, UNITED STATES
DEPARTMENT OF JUSTICE, Washington, D.C., for Appellants. ON RESPONSE: S. Joshua
Kahane, Aubrey B. Greer, GLANKLER BROWN, PLLC, Memphis, Tennessee, for Appellees.
                                     _________________

                                             ORDER
                                     _________________

       Last September, the Centers for Disease Control and Prevention ordered a nationwide
moratorium on residential evictions. As justification for its involvement in landlord-tenant
relations, the CDC cited a provision of the Public Health Service Act authorizing it to sanitize
property exposed to contagion. Plaintiffs in this case—all of whom own or manage residential
 No. 21-5256                       Tiger Lily, LLC, et al. v. HUD, et al.                                 Page 2

rental properties—challenged the CDC’s order and its subsequent extension. The district court
entered judgment in favor of Plaintiffs. The government now moves to stay the district court’s
order pending appeal. We deny its motion.

                                                         I

        In March 2020, Congress responded to the wide-ranging economic effects of the COVID-
19 pandemic by passing the CARES Act. See Pub. L. No. 116-136, 134 Stat. 281 (2020).
Among other economic relief provisions, the Act included a 120-day moratorium on eviction
filings based on nonpayment of rent for tenants residing in certain federally financed rental
properties. Id. § 4024(b). That moratorium expired on July 25, 2020.

        After the congressionally authorized moratorium expired, the CDC Director unilaterally
issued an order declaring a new moratorium, halting evictions of certain “covered persons”
through December 31, 2020. 85 Fed. Reg. 55292-01. The CDC purported to find statutory
authority for the Halt Order in Section 361 of the Public Health Service Act, codified at
42 U.S.C. § 264. Id. That section provides the Secretary of Health and Human Services with the
power to “make and enforce such regulations as in his judgment are necessary to prevent the
introduction, transmission, or spread of communicable diseases.” 42 U.S.C. § 264(a).1 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 by regulation. See 42 C.F.R. § 70.2.

        Shortly after the CDC issued the Halt Order, Congress passed the Consolidated
Appropriations Act, which extended the Halt Order from December 31 to January 31. Pub. L.
No. 116-260, § 502, 134 Stat. 1182 (2020).

        1
           The statute actually grants this authority to the Surgeon General. But that office was abolished in 1966,
and all statutory powers vested in the Surgeon General were transferred to the HHS Secretary. 31 Fed. Reg. 8855;
20 U.S.C. § 3508. The Secretary retained those powers even after the Office of the Surgeon General was reinstated
in 1987.
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         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.
(citing 42 U.S.C. § 264(a)).

         In September 2020, Plaintiffs filed suit against the government seeking, as relevant here,
a declaratory judgment that the Halt Order violated the Administrative Procedures Act and a
preliminary injunction barring its enforcement.                   The district court denied the preliminary
injunction because it found that Plaintiffs’ loss of income did not rise to the level of an
irreparable injury. The government then moved for judgment on the pleadings. Plaintiffs
countered with a Rule 56 motion for judgment on the administrative record. The district court
granted judgment in Plaintiffs’ favor, finding that the Halt Order exceeded the CDC’s statutory
authority under 42 U.S.C. § 264(a).

         The day after the district court entered judgment, the government filed its appeal and
moved the district court for an emergency stay and immediate administrative stay. Plaintiffs
notified the district court that they intended to take two weeks to respond, and the district court
did not order otherwise. The government then filed the stay motion now before us.2

                                                           II

         We consider four factors when deciding whether to stay a judgment pending appeal:
“(1) whether the stay applicant has made a strong showing that he is likely to succeed on the
merits; (2) whether the applicant will be irreparably injured absent a stay; (3) whether issuance
of the stay will substantially injure the other parties interested in the proceeding; and (4) where
the public interest lies.” Nken v. Holder, 556 U.S. 418, 434 (2009) (quotation and brackets

         2
            Plaintiffs initially refused our order for a substantive response to the government’s stay motion, objecting
that the motion was procedurally improper. While not a jurisdictional limitation, “[a] party must ordinarily move
first in the district court for . . . a stay of the judgment or order of a district court pending appeal.” Fed. R. App. P.
8(a)(1)(A). But if “moving first in the district court would be impracticable” or if “a motion having been made, the
district court…failed to afford the relief requested,” we may grant initial relief. Fed. R. App. P. 8(a)(2)(A)(i)−(ii).
Here, the government did move first in the district court, but Plaintiffs notified the court that they intend to use the
full time (14 days) to respond. See W.D. Tenn. LR 7.2(a)(2). Given the Halt Order’s looming March 31 expiration,
we construe the district court’s decision not to order a more expedited response as a denial of the government’s
requested relief. The normal appellate rules thus present no bar to the government’s motion.
 No. 21-5256                        Tiger Lily, LLC, et al. v. HUD, et al.                                 Page 4

omitted). When a party has no likelihood of success on the merits, we may not grant a stay.
SawariMedia, LLC v. Whitmer, 963 F.3d 595, 596 (6th Cir. 2020) (quoting Daunt v. Benson,
956 F.3d 396, 421–22 (6th Cir. 2020)).

          Whether the government is likely to succeed on the merits boils down to a simple
question: did Congress grant the CDC the power it claims? We address that question of statutory
interpretation de novo. See Smith v. Thomas, 911 F.3d 378, 381 (6th Cir. 2018).3 When
analyzing the statute, “we look first to its language, giving the words used their ordinary
meaning.” Artis v. District of Columbia, 138 S. Ct. 594, 603 (2018) (citation and internal
quotation marks omitted). We then apply “established principles of interpretation.” POM
Wonderful LLC v. Coca-Cola Co., 134 S. Ct. 2228, 2236 (2014). If, after those steps, the
statute’s meaning is clear, our task is done. See BedRoc Ltd. v. United States, 541 U.S. 176, 183
(2004).

          Because Congress’s express authorization of the Halt Order expired on January 31, the
CDC points to 42 U.S.C. § 264 as the sole statutory basis for the order’s extension. But the
terms of that statute cannot support the broad power that the CDC seeks to exert.

          To slow disease transmission, the HHS Secretary, and the CDC by extension, can impose
specific restrictions on both property interests, see 42 U.S.C. § 264(a), and liberty interests, see
id. § 264(d). As to the former, the Secretary “may provide for such 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. § 264(a). The government asserts that a
nationwide eviction moratorium is among the “other measures” for disease control that Congress
envisioned when drafting the statute.

          3
            When reviewing an agency’s construction of a statute it administers, we generally apply the two-step
Chevron framework that requires us (1) to determine whether the statute is unambiguous, and (2) if so, to defer to
the agency’s construction if it is permissible. Chevron, U.S.A., Inc. v. NRDC, Inc., 467 U.S. 837, 842–43 (1984);
Arangure v. Whitaker, 911 F.3d 333, 338 (6th Cir. 2018). Where the statute is unambiguous, then “that is the end
of the matter”: the court applies it as written. Id. (quoting City of Arlington v. FCC, 569 U.S. 290, 296 (2013)). In
the briefing before us, neither party has argued that Chevron applies. Whether or not it applies, we find that the
statute is unambiguous; therefore, we need not proceed beyond step one in any event.
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       We disagree. This kind of catchall provision at the end of a list of specific items warrants
application of the ejusdem generis canon, which says that “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.” Circuit City
Stores, Inc. v. Adams, 532 U.S. 105, 114–15 (2001) (citation omitted). The residual phrase in §
264(a) is “controlled and defined by reference to the enumerated categories . . . before it,” id. at
115, such that the “other measures” envisioned in the statute are measures like “inspection,
fumigation, disinfection, sanitation, pest extermination” and so on, 42 U.S.C. § 264(a). Plainly,
government intrusion on property to sanitize and dispose of infected matter is different in nature
from a moratorium on evictions. See Terkel v. CDC, No. 6:20-cv-00564, 2021 WL 742877, at
*6 (E.D. Tex. Feb. 25, 2021) (holding that the Halt Order exceeded the scope of the CDC’s
authority and observing that “eviction is fundamentally the vindication of the property owner’s
possessory interest”). The Halt Order thus falls outside the scope of the statute.

       Furthermore, even if we were inclined to construe the phrase “other measures” as
expansively as the government suggests, we cannot read the Public Health Service Act to grant
the CDC the power to insert itself into the landlord-tenant relationship without some clear,
unequivocal textual evidence of Congress’s intent to do so. Regulation of the landlord-tenant
relationship is historically the province of the states. Loretto v. Teleprompter Manhattan CATV
Corp., 458 U.S. 419, 440 (1982) (“This Court has consistently affirmed that States have broad
power to regulate housing conditions in general and the landlord-tenant relationship in
particular.”). It is an “ordinary rule of statutory construction that if Congress intends to alter the
usual constitutional balance between the States and the Federal Government, it must make its
intention to do so unmistakably clear in the language of the statute.” Will v. Mich. Dep’t of State
Police, 491 U.S. 58, 65 (1989) (quotation marks and citation omitted); Solid Waste Agency v.
U.S. Army Corps of Eng’rs, 531 U.S. 159, 172–73 (2001) (declining to defer to agency
interpretation of a statute where the interpretation pushed the limits of Congress’s Commerce
Clause authority “by permitting federal encroachment upon a traditional state power”). There is
no “unmistakably clear” language in the Public Health Service Act indicating Congress’s intent
to invade the traditionally State-operated arena of landlord-tenant relations.
 No. 21-5256                    Tiger Lily, LLC, et al. v. HUD, et al.                      Page 6

        As the district court noted, the broad construction of § 264 the government proposes
raises not only concerns about federalism, but also concerns about the delegation of legislative
power to the executive branch. The government would have us construe the phrase “and other
measures, as in his judgment may be necessary,” 42 U.S.C. § 264, as a “broad grant of authority”
to impose any number of regulatory actions, provided the Secretary believes those actions will
help prevent the spread of disease, regardless of whether they are in any way tethered to the
“specific intrusions on private property described in the second sentence” of § 264. “In the
absence of a clear mandate in the Act, it is unreasonable to assume that Congress intended to
give the Secretary the unprecedented power” of that kind. Indus. Union Dep’t, AFL-CIO v. API,
448 U.S. 607, 645 (1980) (plurality opinion).           We will not make such an unreasonable
assumption.

        The government raises two textual counterarguments, neither of which has merit. Its first
requires some unpacking. The government argues primarily that (i) a later subsection of § 264
acknowledges the Secretary’s authority to enforce quarantines, (ii) quarantines are not among the
enumerated provisions of § 264(a), (iii) quarantines are different in kind from the enumerated
provisions, and therefore, (iv) “other measures” must be read more expansively than the ejusdem
generis canon allows. The argument has cosmetic appeal, but it does not withstand scrutiny.
Those later subsections concern the government’s limited power to restrict liberty interests—by
means of enforced quarantine—in order to prevent the spread of disease. Section 264(a) is
concerned exclusively with restrictions on property interests and is, therefore, structurally
separate from the statute’s quarantine provision. Prohibiting landlords from evicting nonpaying
tenants unquestionably restricts a property interest, but an eviction moratorium is radically unlike
the property interest restrictions listed in § 264(a) (sanitizing, fumigating, etc.).

        Second, the government contends that when Congress legislatively extended the Halt
Order to January 31 through the Consolidated Appropriations Act, it effectively acknowledged
that § 264(a) authorized the Halt Order in the first place. That argument also fails. It is true that
when Congress legislatively extended the Halt Order, it referenced the fact that the CDC claimed
42 U.S.C. § 264(a) as its authority for issuing the order in the first place. H.R. 133, 116th Cong.,
div. N, tit. V, § 502. However, mere congressional acquiescence in the CDC’s assertion that the
 No. 21-5256                   Tiger Lily, LLC, et al. v. HUD, et al.                        Page 7

Halt Order was supported by 42 U.S.C. § 264(a) does not make it so, especially given that the
plain text of that provision indicates otherwise. We acknowledge that Congress has “the power
to ratify . . . acts which it might have authorized and give the force of law to official action
unauthorized when taken.” Swayne & Hoyt, Ltd. v. United States, 300 U.S. 297, 301-02 (1937)
(internal citation omitted). But nothing in § 502 expressly approved the agency’s interpretation.
All § 502 did was congressionally extend the agency’s action until January 31, 2021. H.R. 133,
116th Cong., div. N, tit. V, § 502. After that date, Congress withdrew its support, and the CDC
could rely only on the plain text of 42 U.S.C. § 264, which, as noted, does not authorize the CDC
Director to ban evictions.

       Given that the government is unlikely to succeed on the merits, we need not consider the
remaining stay factors. See Maryville Baptist Church, Inc. v. Beshear, 957 F.3d 610, 615–16
(6th Cir. 2020); Mich. Coal. of Radioactive Material Users, Inc. v. Griepentrog, 945 F.2d 150,
153–54 (6th Cir. 1991) (“[E]ven if a movant demonstrates irreparable harm that decidedly
outweighs any potential harm to the [Plaintiffs] if a stay is granted, [it] is still required to show,
at a minimum, serious questions going to the merits”).

       The emergency motion for a stay pending appeal is denied.

                                                      ENTERED BY ORDER OF THE COURT

                                                      ____________________________________
                                                      Deborah S. Hunt, Clerk