The Supreme Court declined to take up a case that sought to slash New York City's decades-old rent control law, but lawyers for the property owners claimed it's "not the end of the road."
"Let’s be clear. The Supreme Court’s actions today do not certify New York’s Rent Stabilization Law is constitutional," the Community Housing Improvement Program (CHIP) and the Rent Stabilization Association of NYC (RSA) said Monday in a joint statement.
CHIP and RSA first sued the city in 2019, challenging the constitutionality of New York’s 50-year-old Rent Stabilization Law.
"We knew that bringing facial challenges to the law was an uphill battle, but that was also the quickest and most efficient way to provide the broadest relief for all property owners suffering from unconstitutional restrictions under this law," the statement said.
SUPREME COURT URGED TO STEP IN ON BLUE CITY'S 'DRACONIAN' RENT-CONTROL LAWS
"We see the Supreme Court’s decision not to take our case as a signal to bring more targeted challenges to specific provisions of the law illustrating direct impacts on housing providers," the groups said.
"Unfortunately, the current policies are forcing thousands of buildings into bankruptcy, so there are plenty of examples that can now be brought before the courts."
The groups had argued that the law violates the Fifth Amendment’s "takings clause" governing property seizures and the 14th Amendment’s due process clause.
There are reportedly over 1 million rent-stabilized apartments in New York City — which account for about half the rentals citywide.
The suit argued that once a tenant's lease is up, the law prevents owners from occupying their own property, changing its use or simply leaving it vacant. Instead, the tenants are the "successors" of the property and unless they do something illegal, the tenants are entitled to lease renewals in perpetuity.
The case was dismissed by the U.S. District Court for the Eastern District of New York and again by the U.S. Court of Appeals for the Second Circuit in late 2020, before the Supreme Court declined to hear the case.
Zachary Rothken, an attorney with Rosenberg & Estis with an expertise in New York rent law, called the denial "another disappointing chapter for property owners operating within a system that is unsustainable in its status quo."
He also signaled that cases will continue to be brought until "a realistic solution" is on the table.
"New York’s rent stabilization laws were instituted at a very different time to address a very different problem. They have been pushed, exploited and abused to the limit and neither the legislature nor the courts can continue to ignore the problem," said Rothken.
"Bad laws and disregard for property rights are not good for anyone. They're not good for landlords, they're not good for tenants, and they're not good for the economy," he added.
