Darby Development v. United States, Federal Circuit Appeal Covid Rent Eviction Moratorium Case

Case Background

A group of residential landlords, led by Darby Development, argued that the CDC’s nationwide ban on evictions for nonpayment transformed their property rights, forcing them to continue housing non-paying tenants and preventing them from excluding others from their property. They filed suit in the U.S. Court of Federal Claims, seeking compensation for this deprivation under the Takings Clause.​

Court Decisions

• The Court of Federal Claims initially dismissed the complaint, agreeing with the government that acts not authorized by Congress (here, the CDC order, which the Supreme Court found exceeded statutory authority) cannot constitute government “takings” that require compensation.​

• On appeal, the Federal Circuit reversed and remanded the case. The appellate court held that the CDC order was “authorized for takings purposes” because it was a good faith act within the CDC’s normal scope of duties, even if found unlawful later. The court recognized the landlords’ complaint as properly stating a claim for physical taking, as the moratorium denied them the right to exclude non-paying tenants—a core property right.​

Significance

The Darby case clarified that even if agency action is later judged unlawful, property owners may still pursue takings claims for good faith exercise of government power that results in direct appropriation of private property interests. It sets an important precedent for landlord rights and compensation in future emergency government interventions impacting property.

• Federal Circuit Decision in Favor of Landlords
  • First AMENDED COMPLAINT against USA
  • Petition for en banc rehearing by USA
  • Decision Denying Petition for Rehearing En Banc
  • CORRECTED OPENING BRIEF
  • RESPONSE BRIEF FILED by Appellee US.
  • REPLY BRIEF FILED by Appellants
  • AMICUS CURIAE BRIEF FILED by National Association of REALTORS.
  • AMICUS BRIEF FILED by New Civil Liberties Alliance.
  • AMICUS CURIAE BRIEF FILED by The National Association of Homebuilders
  • APPENDIX FILED by Appellants