Fed Dist. Court in CA Denies City’s Summary Judgment Motion Against FHA and Equal Protection Claims Over Denial of Conditional Use Permit to House Unaccompanied Alien Children

Plaintiff Southwest Key, a corporate entity, sought to convert a former skilled nursing facility located in a residential zone into a custodial facility for up to 96 unaccompanied alien children (“UAC”). The UAC were taken into custody at the border by Immigration and Customs Enforcement (“ICE”) and subsequently transferred to custodial facilities by the Office of Refugee Resettlement (“ORR”) while awaiting resolution of their immigration proceedings. Southwest Key applied for a conditional use permit from Defendant for its proposed use of the facility, but the Planning Commission denied Plaintiff Southwest Key’s application for the conditional use permit. Plaintiff Southwest Key appealed the decision to the City Council, which affirmed the denial of the conditional use permit. In this case, Southwest Key alleged a violation of the Federal Fair Housing Act; the California Fair Employment and Housing Act; the Equal Protection Clause of the Fourteenth Amendment; and the Supremacy Clause of the United States Constitution.

Defendant first contended that the Federal Fair Housing Act (“FHA”) and California Fair Employment and Housing Act (“FEHA”) did not apply to Plaintiff Southwest Key’s custodial facilities because such facilities were not “dwellings” for FHA and FEHA purposes and the UAC were not willing participants. The court found that despite the fact that UAC were provided with education, health care, counseling, and other services at Plaintiff Southwest Key’s facilities until their legal status in the United States was resolved, did not make Plaintiff Southwest Key’s facilities akin to a university or boarding school. Instead, the court found that the main purpose of Plaintiff Southwest Key’s facilities was to detain the UAC after they were apprehended by federal authorities until their release from custody or removal from the United States. Despite this, the court found that there was a triable issue of material fact as to whether the facility was a dwelling under the FHA and FEHA. Thus, the Court denied summary judgment to Defendant on this claim.

Defendant next argued Plaintiff’s second claim should be dismissed because Plaintiff Southwest Key did not have standing to raise equal protection claims on behalf of the UAC. Here, Plaintiff Southwest Key was a corporation, not a member of a protected class, and the FAC did not allege that it had been deprived a right to equal protection other than a statement that the zoning decision hurt its mission. As a corporation, Plaintiff Southwest Key was not entitled to ignore zoning requirements for a non-conforming use. The court rejected Plaintiff Southwest Key’s argument that the UAC could not have filed their own suit due to financial burdens and lack of legal sophistication was belied by class action suits brought by UAC, and thus declined to find third party standing. However, based on its statement in the FAC that Defendant’s actions “hurt its mission,” the court allowed Plaintiff Southwest Key to proceed with its own equal protection claim.

As to the Supremacy Clause claim, the court noted that the federal government declined to assert federal preemption and referred to it as “jurisdiction” in correspondence with Plaintiff Southwest Key. As a result, the Court had reservations over Plaintiff Southwest Key’s expansive notion of field or conflict preemption for the facts of this case. While preemption is an issue of law, the court found that further development of the record would assist the Court in its decision on the Supremacy Clause claim. As such, the court allowed this claim to proceed to trial as well.

Southwest Key Programs, Inc. v City of Escondido, 2017 WL 1094001 (SD CA 3/24/2017)