335-7 LLC v. City of New York

Background

Five owners and landlords of residential apartment buildings in New York City challenged the New York State and New York City Rent Stabilization Laws, including the 2019 amendments. They asserted claims under the Fifth and Fourteenth Amendments and 42 U.S.C. § 1983, alleging that the laws caused physical, regulatory, and confiscatory takings of property without just compensation and violated due process.

The court considered only a motion by New York Tenants & Neighbors and Community Voices Heard to intervene permissively under Federal Rule of Civil Procedure 24(b). Permissive intervention allows a nonparty to join a case when its claim or defense shares a common question of law or fact with the existing lawsuit, provided that joining will not unduly delay or prejudice the original parties. The City and State defendants consented to intervention; the landlord plaintiffs opposed it. The opinion states that motions to dismiss under Rule 12(b)(6) were also being briefed, but those motions were not at issue in this order.

Court’s Analysis

The court held that the proposed intervenors satisfied the common-question requirement because their defenses shared the lawsuit’s central question: whether the Rent Stabilization Laws, as amended in 2019, are constitutional.

The court also found that the groups’ involvement would assist in developing the factual record and resolving the legal issues. It relied on their decades of work with tenants, their involvement with efforts related to the 2019 law, and their members’ status as rent-regulated tenants. The court concluded that allowing the groups to participate would provide more assistance than allowing them to submit only friend-of-the-court briefs.

The court rejected the landlords’ concern that intervention would cause undue prejudice. The motion was filed promptly, the groups would follow the existing briefing schedule, and the case was still at an early stage. The court also found the landlords’ concerns about duplicative discovery premature and noted that it could supervise discovery if necessary.

The court further explained that, for permissive intervention, the proposed intervenors did not have to show that the existing defendants inadequately represented their interests. Although adequate representation could weigh against intervention, intervention could still be appropriate if the additional parties would assist in a fair and equitable resolution of the issues. The court also rejected the argument that granting this motion would lead to many similar applications, noting that the case had already been pending for more than four months and that later applications might be untimely.

Disposition

Judge Edgardo Ramos granted the proposed intervenors’ motion to intervene and directed the Clerk to terminate the motion, docket entry 48. The order addressed participation in the lawsuit only; it did not decide the landlords’ constitutional claims or the pending motions to dismiss.