Damhesel v. Chicago Housing Authority

Filing 41

MEMORANDUM OPINION Signed by the Honorable Samuel Der-Yeghiayan on 11/13/2015: Granting in part Defendant's motion to dismiss and dismissing the remaining State Law claims without prejudice. Mailed notice (mw, )

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
JOHN DAMHESEL,

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Plaintiff,
v.
CHICAGO HOUSING AUTHORITY,
Defendant.

No. 15 C 6581

MEMORANDUM OPINION
SAMUEL DER-YEGHIAYAN, District Judge
This matter is before the court on Defendant Chicago Housing Authority’s
(CHA) motion to dismiss. For the reasons stated below, the motion to dismiss is
granted in part, and the remaining state law claims are dismissed without prejudice.

BACKGROUND
In March 2014, Plaintiff John Damhesel (Damhesel) allegedly received a
voucher (Voucher) from the CHA for the Section 8 Housing Choice Voucher
Program (Voucher Program) instituted in accordance with Section 8 of the United
States Housing Act of 1937, 42 U.S.C. § 1437f (Housing Act). The Voucher
allegedly indicated that it would expire on December 15, 2014. Damhesel
acknowledges that he did not take any of the necessary steps to utilize the Voucher or

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participate in the Voucher Program prior to the expiration date. However, Damhesel
now contends, in retrospect, that he should have been accorded due process in the
form of a hearing before his eligibility for the Voucher Program was terminated.
Damhesel also contends that he should not have been removed from the Voucher
Program waiting list. Damhesel has brought the instant action seeking injunctive
relief and attorneys’ fees, and compensatory damages. Damhesel includes in his
complaint a claim brought pursuant to 42 U.S.C. § 1983 (Section 1983) alleging a
deprivation of due process (Count I), a Fourth Amendment Section 1983 claim
(Count II), a Housing Act claim (Count III), a claim for a petition for certiorari
seeking judicial review of CHA’s final administrative decision (Count IV), and a
mandamus claim (Count V). CHA now moves to dismiss the instant action.

LEGAL STANDARD
In ruling on a motion to dismiss brought pursuant to Federal Rule of Civil
Procedure 12(b)(6) (Rule 12(b)(6)), a court must “accept as true all of the allegations
contained in a complaint” and make reasonable inferences in favor of the plaintiff.
Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009)(stating that the tenet is “inapplicable
to legal conclusions”); Thompson v. Ill. Dep’t of Prof’l Regulation, 300 F.3d 750,
753 (7th Cir. 2002). To defeat a Rule 12(b)(6) motion to dismiss, “a complaint must
contain sufficient factual matter, accepted as true, to state a claim to relief that is
plausible on its face.” Iqbal, 129 S.Ct. at 1949 (internal quotations omitted)(quoting
in part Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A complaint that
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contains factual allegations that are “merely consistent with a defendant’s liability . .
. stops short of the line between possibility and plausibility of entitlement to relief.”
Iqbal, 129 S.Ct. at 1949 (internal quotations omitted).

DISCUSSION

I. Inability to Use Voucher in Timely Fashion
In the complaint, Damhesel vaguely asserts that he could not use the Voucher
before it expired, alleging that “despite [his] best efforts, he was unable to use the
voucher before the expiration date.” (Compl. 1). However, in response to the instant
motion, Damhesel elaborates the circumstances surrounding his efforts, stating that
he applied for a rental unit and the landlord ultimately refused to rent to Damhesel
because the rent offered by the CHA was too low. (Resp. 7). Such facts do not even
remotely suggest that Damhesel was unable to use the Voucher in the more than nine
months that Damhesel was given to use the Voucher. It was Damhesel’s obligation,
not the CHA’s obligation, to locate appropriate housing and take the proper
administrative steps to participate in the Voucher Program. Damhesel has offered no
facts to suggest that the necessary information for participation in the Voucher
Program was withheld from him or any facts that indicate that he was prevented from
pursuing such administrative steps. CHA also correctly points out that there is no
allegation that Damhesel even requested a new voucher after the expiration of the
Voucher. Instead, Damhesel has turned to litigation. As explained below, even if
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the court accepts as true for the purposes of the instant motion that Damhesel’s
conclusory allegation that he was unable to use the Voucher prior to the expiration
date, CHA cannot be held liable for its actions in regard to Damhesel since Damhesel
does not allege that he was a participant in the Voucher Program, or shown that he
has a private right of action under the Housing Act.

II. Lack of a Legitimate Interest (Counts I and II)
CHA argues that Damhesel has not alleged facts that would suggest that he
had an interest in participation in the Voucher Program that could support a Section
1983 due process claim or Section 1983 Fourth Amendment claim. For a due
process claim, a plaintiff must establish that the state deprived the plaintiff “of a
constitutionally protected liberty or property interest and that the deprivation
occurred without constitutionally adequate process.” Citizens Health Corp. v.
Sebelius, 725 F.3d 687, 693-94 (7th Cir. 2013)(stating that “[t]he threshold question
in any due process challenge is whether a protected property or liberty interest
actually exists”); see also Khan v. Bland, 630 F.3d 519, 535 (7th Cir. 2010)(stating
that “[i]ntrusion upon a cognizable property interest is a threshold prerequisite to a
substantive due process claim”)(internal quotations omitted)(quoting Gen. Auto Serv.
Station v. City of Chi., 526 F.3d 991, 1002 (7th Cir. 2008)). For a Fourth
Amendment claim premised on an alleged improper seizure, a plaintiff must establish
a possessory interest in the property. United States v. James, 571 F.3d 707, 713 (7th
Cir. 2009)(indicating that the “use of the term ‘seizure’” means “some meaningful
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interference with an individual’s possessory interests in [his] property”)(internal
quotations omitted)(quoting Soldal v. Cook County, 506 U.S. 56, 61 (1992)).
The court can consider the contents of the Voucher in ruling on the instant
motion since the Voucher is referenced in the complaint and is central to Damhesel’s
claims. See Brownmark Films, LLC v. Comedy Partners, 682 F.3d 687, 690 (7th Cir.
2012)(stating that “[i]t is well settled that in deciding a Rule 12(b)(6) motion, a court
may consider documents attached to a motion to dismiss . . . if they are referred to in
the plaintiff’s complaint and are central to his claim”)(internal quotations
omitted)(quoting Wright v. Assoc. Ins. Cos. Inc., 29 F.3d 1244, 1248 (7th Cir.
1994)). The Voucher informed Damhesel that a public housing agency (PHA),
which in this case was the CHA, had determined that he was “eligible to participate”
in the program under which the CHA would enter into a housing assistance payments
(HAP) contract with the owner of a residential unit. (Mot. Ex. 2). The Voucher also
specifically included the following language:
The voucher does not give the family any right to participate in PHA’s
housing choice voucher program. The family becomes a participant in the
PHA’s housing choice voucher program when the HAP contract between the
PHA and owner takes effect.
(Mot. Ex. 2). Damhesel does not allege facts that would suggest that he took any
steps to cause any contract to take effect. Although Damhesel argues in response to
the instant motion that CHA refused to issue Damhesel a new voucher, Damhesel’s
allegations suggest only that the Voucher expired on its own terms. There is no
allegation that the Voucher was withdrawn by CHA, that Damhesel requested a new
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voucher, or that such a request was refused. Nor did Damhesel even qualify for an
informal hearing under the CHA’s Administrative Plan since there is no indication
that he was denied any relief that would warrant such a hearing.
The precedent cited by Damhesel himself only reinforces the conclusion that
he lacks any interest that could support a Section 1983 claim. For example,
Damhesel relies upon Holbrook v. Pitt, 643 F.2d 1261 (7th Cir. 1981). However, in
Holbrook, the plaintiffs were participants in the housing assistance program, not
merely individuals who were eligible for the program. Id. at 1264. Damhesel has
not identified any interest that could be the underlying basis for any Section 1983
claim in this case. Therefore, CHA’s motion to dismiss the Section 1983 due process
claim (Count I) and the Section 1983 Fourth Amendment claim (Count II) is granted.

III. Housing Act Claim (Count III)
CHA argues that the Housing Act does not provide a private right of action.
Damhesel has not pointed to any statute that expressly provides him with a private
right of action under the Housing Act. To determine whether a private right of action
may be implied from an act of Congress, a court should consider “whether Congress
intended an implied right of action . . . in light of the statute’s language, structure,
and legislative history.” Edelson v. Ch’ien, 405 F.3d 620, 630 (7th Cir.
2005)(internal quotations omitted)(quoting Mallett v. Wisconsin Div. of Vocational
Rehab., 130 F.3d 1245 (7th Cir. 1997)). Damhesel has not pointed to controlling
precedent that recognizes the implied private right of action under the Housing Act,
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which would provide a right of action to those who are merely found to be eligible
for the Voucher Program. Nor has Damhesel shown that such an implied right
should be recognized based on the language, structure and legislative history of the
Housing Act. See Edelson, 405 F.3d at 630 (stating that “[t]he central inquiry
remains whether Congress intended to create, either expressly or by implication, a
private cause of action”)(internal quotations omitted)(quoting Touche Ross & Co. v.
Redington, 442 U.S. 560, 575 (1979)). The court declines, in this instance, to
recognize such a private right of action that was not specifically provided by
Congress in the Housing Act. CHA does not dispute that if Damhesel had become a
participant in the Voucher Program, he would have been entitled to certain rights and
due process, but Damhesel’s allegations do not suggest that he took the necessary
steps to become such a participant. The court also notes that even if Damhesel had a
private right of action under the Housing Act, he has failed to allege facts to suggest
that he was denied any specific right in the Housing Act by the CHA. Therefore,
CHA’s motion to dismiss the Housing Act claim (Count III) is granted.

IV. Equitable and Public Policy Considerations
Damhesel’s novel legal argument that he has certain legal protections based
merely on the fact that he was eligible for the Voucher Program is not supported by
any controlling precedent, and the facts presented in this case do not run afoul of
equitable or public policy considerations. The CHA, in implementing the Voucher
Program, is charged with assisting those in financial need with obtaining needed
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shelter. See Eidson, 745 F.2d at 457 (explaining that “Section 8 authorizes the
Secretary to make “assistance payments . . . with respect to existing, newly
constructed, and substantially rehabilitated housing for the purposes of aiding
lower-income families in obtaining a decent place to live and of promoting
economically mixed housing”)(internal quotations omitted)(quoting 42 U.S.C. §
1437f(a)). There is no justification under the law or in equity to charge the CHA
with the legal obligation to oversee the rights of all persons that are merely eligible
for the Voucher Program and provide hearings and/or other forms of review
advocated by Damhesel relating to expiration of eligibility. The record reflects that
there are ample persons in need of assistance who are participants in the Voucher
Program. The Seventh Circuit has noted “that there are not enough Section 8
housing units to accommodate all who are eligible and willing to take them,” and that
the CHA must “allocate these limited and valuable benefits among a large number of
eligible applicants.” Eidson, 745 F.2d at 457, 461 (stating that “Section 8 is aimed at
providing benefits to a class of lower-income families, but the program establishes
no preferences regarding the allocation of these scarce benefits among the eligible
class members”); see also Fincher v. S. Bend Heritage Found., 606 F.3d 331, 336
(7th Cir. 2010)(declining to overturn Eidson). Nothing in Housing Act, or any other
federal law would obligate the CHA to expend additional time and resources for
persons such as Damhesel who are given adequate notice of the expiration terms and
do not take any of the steps necessary to participate in the program.
Damhesel also argues that he did not violate any rules of the Voucher Program
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and it is unfair that he was removed from it, but his own facts alleged in the
complaint show that he was not removed from the Voucher Program by CHA.
Damhesel’s alleged facts show that the Voucher simply expired in accordance with
the terms specified on the Voucher. Thus, equitable and public policy considerations
support a dismissal of the instant action.

V. Remaining State Law Claims
CHA argues that the certiorari and mandamus claims are state law claims and
that the court should decline to exercise supplemental jurisdiction over such claims.
Once the federal claims in an action no longer remain, a federal court has discretion
to decline to exercise supplemental jurisdiction over any remaining state law claims.
See Wright v. Associated Ins. Cos., 29 F.3d 1244, 1251-52 (7th Cir. 1994)(stating
that “the general rule is that, when all federal-law claims are dismissed before trial,
the pendent claims should be left to the state courts”). The Seventh Circuit has
indicated that there is no “‘presumption’ in favor of relinquishing supplemental
jurisdiction. . . .” Williams Electronics Games, Inc. v. Garrity, 479 F.3d 904, 906-07
(7th Cir. 2007). The Seventh Circuit has stated that, “in exercising its discretion, the
court should consider a number of factors, including “the nature of the state law
claims at issue, their ease of resolution, and the actual, and avoidable, expenditure of
judicial resources. . . .” Timm v. Mead Corp., 32 F.3d 273, 277 (7th Cir. 1994). The
court has considered all of the pertinent factors and, as a matter of discretion, the
court declines to exercise supplemental jurisdiction over the remaining state law
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claims. The instant action is still in the pre-trial stage and there is not sufficient
justification to proceed solely on the remaining state law claims. The remaining state
law claims are therefore dismissed without prejudice.

CONCLUSION
Based on the foregoing analysis, CHA’s motion to dismiss is granted in part,
and the remaining state law claims are dismissed without prejudice.

___________________________________
Samuel Der-Yeghiayan
United States District Court Judge
Dated: November 13, 2015

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