Federal Overreach SLAMMED — Landlords Get Paid

Federal court delivers major victory for landlords, ruling COVID eviction moratorium an unconstitutional taking that demands taxpayer compensation.

Story Highlights

U.S. Court of Appeals for the Federal Circuit upholds ruling in Darby v. United States, denying government rehearing and affirming Fifth Amendment protections.
Landlords nationwide can now pursue billions in claims for losses from non-paying tenants during CDC’s 2020-2021 moratorium.
Ruling expands “physical takings” precedent from Cedar Point Nursery v. Hassid, curbing federal overreach on private property.
Small landlords, hit hardest by moratorium costs like mortgages and maintenance, gain path to financial recovery via Court of Federal Claims.
Potential strain on federal budgets as claims proceed, with no Supreme Court appeal confirmed yet.

Court Rules Moratorium a Physical Taking

The U.S. Court of Appeals for the Federal Circuit ruled on June 6, 2025, that the CDC’s COVID-19 eviction moratorium constituted a physical taking under the Fifth Amendment. Landlords like those in Darby Development Inc. could not evict non-paying tenants despite covering mortgages, taxes, and maintenance. The court denied the government’s rehearing petition, solidifying landlords’ right to just compensation. This decision protects property owners from uncompensated government intrusions, a core American principle now under threat from emergency powers.

Timeline of Moratorium and Legal Battle

Congress enacted the initial eviction moratorium via the CARES Act on March 27, 2020. The CDC extended it in September 2020 to curb virus spread, covering most U.S. rentals if tenants met income thresholds and pledged future payments. The Supreme Court halted further extensions in August 2021 for exceeding authority but sidestepped takings claims. Georgia and Alabama Realtor associations sued in July 2021, leading to the Federal Circuit’s 2025 decision classifying the ban as infringing the right to exclude others.

Key Stakeholders Push for Recovery

The National Association of Realtors (NAR), National Apartment Association (NAA), and local realtor groups led the Darby plaintiffs, hailing the ruling as a “significant victory” that protects housing providers. Law firms like SLB Law Firm, MROD Law, and McT Law recruit affected landlords for Court of Federal Claims suits on contingency, no upfront fees required. The U.S. government and CDC defended the moratorium as mere regulation, but lost on appeal. Realtor advocates amplify small owners’ voices against federal authority.

Impacts on Property Rights and Government Power

Short-term, landlords file individual or class claims, potentially straining federal budgets with billions in payouts. Long-term, the ruling broadens takings doctrine, limiting future CDC-style regulations on private property without compensation. Small landlords benefit most, recovering losses while tenants owe back rent but face no new liability. Economically, claims may influence future rents and insurance; politically, it checks agency overreach, resonating with Americans frustrated by elite-driven policies eroding foundational rights like property ownership.

Broader Precedent and Future Outlook

Drawing from 2021’s Cedar Point Nursery precedent, the court deemed the moratorium a “physical occupation” by forcing landlords to house non-payers. This deters similar crisis measures without due process. No Supreme Court appeal is confirmed, leaving claims to proceed. Both conservatives valuing limited government and liberals wary of deep state overreach can see this as upholding constitutional limits against unaccountable power. Landlords act now via NAA resources to join suits.