Alcaraz v. KMF Oakland LLC

• Court: District Court, N.D. California
• Decided: June 12, 2020
• Docket: 3:18-cv-02801-SI
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 BERNARDO ALCARAZ, Case No. 18-cv-02801-SI

8 Plaintiff, ORDER GRANTING PLAINTIFF'S 9 v. MOTION FOR PRELIMINARY INJUNCTION AND DENYING 10 KMF OAKLAND LLC, et al., DEFENDANT ALTEZZA'S MOTION TO DISMISS 11 Defendants. Re: Dkt. Nos. 43, 44, 76, 90 12 13 14 Before the Court are plaintiff Bernardo Alcaraz’s motion for preliminary injunction and 15 defendant Altezza Condo LLC’s motion to dismiss the third amended complaint. Dkt. Nos. 76, 90.1 16 The motions came on for telephonic hearing on June 11, 2020. 17 Having considered the papers and arguments and for good cause shown, the Court DENIES 18 defendant’s motion to dismiss and GRANTS plaintiff’s motion for a preliminary injunction. 19

20 21 22

23 1 Also still pending on the Court’s docket are two October 2019 motions: plaintiff’s pro se motion for preliminary injunction and defendant Altezza Condo LLC’s motion to dissolve the 24 temporary restraining order (“TRO”). See Dkt. Nos. 43, 44. As the Court previously explained, see Dkt. No. 70 at 1, the pro se motion for preliminary injunction, Dkt. No. 43, is DEEMED 25 WITHDRAWN upon the filing of plaintiff’s motion by counsel. Defendant’s motion to dissolve the TRO, Dkt. No. 44, is DENIED AS MOOT in light of the fact that plaintiff has since posted the 26 bond that the Court ordered when granting the TRO. See Dkt. No. 83. Defendant made no further argument in support of its motion to dissolve the TRO in this latest round of briefing, nor did 27 defendant file a reply brief in support of the motion to dissolve the TRO despite opportunity to do 1 BACKGROUND 2 I. Factual Background 3 As set forth in this Court’s Order Granting Plaintiff’s Application for a Temporary 4 Restraining Order, this lawsuit arises from plaintiff’s assertion that, on account of his race, color, 5 and/or national origin, defendants have undertaken eviction proceedings against him and have 6 refused to sell him the residence that he occupies. See Dkt. No. 38. The following allegations are 7 drawn from the third amended complaint. Dkt. No. 73 (“TAC”). 8 Plaintiff Bernardo Alcaraz, a Mexican born, Hispanic-American, emigrated to the United 9 States in 1991 and became a naturalized United States Citizen in 1997. Id. ¶ 2. On August 28, 10 2010, Mr. Alcaraz signed a lease for a two-bedroom apartment at 6465 San Pablo Avenue, 11 Apartment #403, Oakland, California, and has lived there ever since. Id. ¶¶ 9, 13; see also Dkt. 12 No. 73-1, TAC Ex. A at 6 (Lease Agreement).2 Apartment #403 is a unit in a 33-unit building now 13 called “The Emerson.” TAC ¶ 9. In 2010, Cascade Acceptance Corp. owned The Emerson. Id. 14 ¶ 10. 15 Prior to signing the lease agreement, Mr. Alcaraz states he spoke with an Emerson manager. 16 Id. ¶¶ 10-11. Specifically, the manager stated that in the future Emerson units would be individually 17 sold. Id. ¶ 11. Mr. Alcaraz further states the manager indicated individuals occupying the units 18 would have first priority to purchase their units when they were sold. Id. Additionally, the lease 19 agreement indicates: “The Trustee will rent units in the building until the market is sufficiently 20 active to allow individual units to be sold over a reasonable period of time, although he may sell the 21 building as a whole to another entity that might hold it as a rental or sell individual units as the 22 market allows.” TAC Ex. A at 6 (Lease Agreement). 23 On or around March 30, 2011, defendant KMF Oakland, LLC (“KMF”) purchased The 24 Emerson from Cascade Acceptance Corp., with defendant Klingbeil Capital Management, Ltd. 25 (“Klingbeil”) as the management company. TAC ¶¶ 14-15; see Dkt. No. 73-2, TAC Ex. B at 2 26 (County of Alameda Assessor’s Office Property Ownership Records). Mr. Alcaraz states that from 27 1 the start of KMF’s ownership, The Emerson was managed by Johnny Rodriguez. TAC ¶ 15. “For 2 the duration of Mr. Rodriguez’s work at The Emerson, he exhibited a discriminatory, hostile, and 3 adversarial attitude of racial/ethnic/national origin/ancestry animus toward Mr. Alcaraz, apparently 4 believing that, due to being Mexican, Mr. Alcaraz was not fit to be a tenant at The Emerson.” Id. 5 ¶ 17. Specifically, Mr. Alcaraz states, during their first interaction, Mr. Rodriguez asked Mr. 6 Alcaraz if he was at The Emerson to perform maintenance work. Id. ¶ 18. Mr. Alcaraz states Mr. 7 Rodriguez would tell Mr. Alcaraz, on occasion, that he spoke English well. Id. Additionally, every 8 so often, the manager would ask, “‘Oh, you’re still here?’ –implying surprise” that Mr. Alcaraz was 9 capable of remaining as an Emerson tenant. Id. Mr. Alcaraz further states that at one time Mr. 10 Rodriguez asked Mr. Alcaraz if his car was in fact owned by his employer. Id. Mr. Alcaraz states 11 that sometime in 2015 the manager told him “he looked like he was more suited to perform 12 maintenance work at The Emerson than to be a tenant.” Id. 13 In early 2015, Mr. Alcaraz states he “began being assessed ‘late’ fees on rent checks that he 14 had timely paid by mail.” Id. ¶ 19. Mr. Alcaraz states that at that time, an individual named Bianca 15 Rodriguez was responsible for processing the rent checks and that she was in a romantic relationship 16 with Mr. Rodriguez. Id. ¶ 20. In mid-2015, Mr. Alcaraz states he began to hand deliver his rent 17 checks to Ms. Rodriguez’s office in San Ramon, California, to ensure the department received his 18 rent checks. Id. ¶ 22. Mr. Alcaraz states he would call ahead to confirm Ms. Rodriguez would be 19 present when he delivered the checks, but on most of Mr. Alcaraz’s attempts, she would no longer 20 be in the office when he arrived. Id. Mr. Alcaraz states he would leave his rent checks under the 21 office door as instructed, but his rent checks continued to be processed either untimely or not at all. 22 Id. “On at least one occasion, Ms. Rodriguez called Mr. Alcaraz to tell him she did not receive his 23 rent check even though Mr. Alcaraz had delivered it.” Id. 24 On September 24, 2015, KMF filed an unlawful detainer action against Mr. Alcaraz, 25 attempting to evict him for unpaid rent. Id. ¶ 23. In response to the unlawful detainer action, Mr. 26 Alcaraz states they reached an agreement. Id. ¶ 24. Mr. Alcaraz would deliver his rent checks to 27 another KMF employee (not Ms. Rodriguez) and KMF would dismiss the action. Id. ¶ 25. Although 1 memorialize the new agreement, KMF never memorialized the new agreement in Mr. Alcaraz’s 2 lease. Id. 3 In early 2016, Mr. Alcaraz states the management company (defendant Klingbeil) again 4 failed to process his rent checks. Id. ¶ 26. On March 11, 2016, KMF initiated a second unlawful 5 detainer action (“the UD Action”) against Mr. Alcaraz in state court even though Mr. Alcaraz had 6 submitted all his rent checks to Klingbeil as required. Id. While that case was pending, in late June 7 2016, KMF sold The Emerson to defendant Altezza Condo LLC (“Altezza” or “defendant”).3 Id. 8 ¶ 27; TAC Ex. B at 2 (County of Alameda Assessor’s Office Property Ownership Records); Dkt. 9 No. 73-9, TAC Ex. I at 2-3 (Grant Deed). Mr. Alcaraz states he made his July 2016 rent payment 10 to the company designated by Altezza and that “[t]he rent check was processed without issue.” TAC 11 ¶ 29. Mr. Alcaraz alleges he inquired about the UD Action with employees of both the prior 12 management company and the new management company for the building and was assured that, 13 because of the building sale, the UD Action would not continue. Id. ¶¶ 30-31. Based on these 14 representations, Mr. Alcaraz states he traveled internationally on business in late July 2016. Id. 15 ¶ 32; see Dkt. No. 73-13, TAC Ex. M at 2-3 (Passport Pages). On August 1, 2016, KMF secured a 16 judgment of possession in the UD Action. Id. ¶ 33. “Mr. Alcaraz was not in attendance at the court 17 proceeding since he was under the impression that the action would not proceed.” Id. 18 On August 26, 2016, Mr. Alcaraz states he received a letter from Mark Chow, at an Altezza- 19 hired real estate marketing and sales firm. Id. ¶ 35; Dkt. No. 73-14, TAC Ex. N at 2-3 (Aug. 26, 20 2016 Mark Chow Letter). The letter indicated Altezza was selling units in The Emerson and Altezza 21 was giving unit renters the first opportunity to purchase the units. Id. The letter stated, in part, 22 The owners would like to provide you the first opportunity to purchase your unit at the 23 price below: 24 Unit #403 25 26 3 In its answer to the second amended complaint, Altezza admitted purchasing the building 27 from KMF “in or around June 28, 2016.” Dkt. No. 35 ¶¶ 50-51. In its opposition to the motion for Price $630,000 1

2 TAC Ex. N at 2. On September 30, 2016, Mr. Alcaraz states he spoke on the phone with Mr. Chow, 3 who indicated they would sell Apartment #403 to Mr. Alcaraz. Id. Mr. Alcaraz memorialized their 4 phone call in an email that same day. TAC ¶ 36; see Dkt. No. 73-15, TAC Ex. O at 2 (Sept. 30, 5 2016 Email to Mark Chow). During the September 30 phone call and again in the email, Mr. Alcaraz 6 indicated that he had a property in Mexico for sale that would net around $389,000. TAC ¶ 36. 7 Combining this with his liquid funds, Mr. Alcaraz indicated that he would purchase his unit in “an 8 all cash sale, and that [he] would like to expeditiously move towards closing.” Id. He then went 9 through with the sale of his property in Mexico in order to purchase his unit in The Emerson. Id. 10 ¶ 37. 11 Mr. Alcaraz alleges that in 2017 individual Emerson units began to be sold as 12 condominiums. Id. ¶ 39. Additionally, Mr. Alcaraz alleges Altezza sales agents discriminatorily 13 acted against prospective buyers if they appeared to be Hispanic or African American. Id. ¶ 40. 14 Mr. Alcaraz states he observed Altezza sales agents be unfriendly toward Hispanic or African 15 American prospective buyers and make them wait around longer for help “while more quickly 16 attending to other prospective buyers.” Id. “On one occasion, while Mr. Alcaraz happened to be 17 passing through the lobby, a Hispanic-appearing couple came in to inquire about viewing a unit. 18 When Mr. Alcaraz returned to the lobby some time later, the couple was still there. Mr. Alcaraz 19 spoke with them in Spanish and confirmed they were still waiting to speak with a sales agent. 20 Having been kept waiting for a long time, the wife suggested to the husband that they should simply 21 leave.” Id. 22 Mr. Alcaraz states he would periodically ask Altezza sales agents if he could move forward 23 with his unit purchase, and the agents would respond indicating the unit was not ready for sale. Id. 24 ¶ 41. In late 2017, Mr. Alcaraz states one of the sales agents, Amy Fox, “told Mr. Alcaraz that 25 Altezza would not sell him his home. She told him that the owners would sell to anyone but him. 26 When Mr. Alcaraz asked Ms. Fox why the owners would not sell to him, . . . Ms. Fox told him it 27 was because they did not like him. Mr. Alcaraz never received another explanation as to why 1 Altezza would not sell to him.”4 Id. ¶ 42. 2 In early 2018, Mr. Alcaraz states Ms. Fox sought to talk to him about moving out. Id. ¶ 44. 3 Mr. Alcaraz further states, by mid-2018, “all of the units in The Emerson, except for Mr. Alcaraz’s 4 home, had been sold at least once. None of the buyers were of Hispanic descent. The units 5 comparable to Mr. Alcaraz’s home were all sold in the range of $630,000.” Id. ¶ 45. 6 On October 5, 2018, KMF obtained a Writ of Possession for Apartment #403 based on the 7 judgment in the UD Action. Id. ¶ 47; Dkt. No. 73-18, TAC Ex. R at 2-3 (Writ of Possession). Mr. 8 Alcaraz alleges KMF obtained the writ “with the presumptive assistance and participation of Altezza 9 and Klingbeil, as KMF had ceased to operate in California no later than November 13, 2017[.]” 10 TAC ¶ 47. Subsequently, on October 23, 2018, Mr. Alcaraz states he received a Notice to Vacate 11 from the Alameda County Sheriff’s Office. Id. ¶ 48; Dkt. No. 73-19, TAC Ex. S (Notice to Vacate). 12 Sometime between July 25, 2019, and August 15, 2019, Mr. Alcaraz states Altezza “started anew 13 the eviction process” based on the 2016 unlawful detainer judgment. TAC ¶ 49. 14 15 II. Procedural Background 16 On May 11, 2018, Mr. Alcaraz, acting pro se, filed the present lawsuit in this Court against 17 defendant KMF. Dkt. No. 1. On November 21, 2018, Mr. Alcaraz filed a first amended complaint. 18 Dkt. No. 9. On July 22, 2019, with the Court’s permission, Mr. Alcaraz filed a second amended 19 complaint, adding Altezza Condo LLC as a defendant, and bringing claims for violation of the 20 federal Fair Housing Act (“FHA”), violation of the Fourteenth Amendment right to Due Process, 21 and injunctive relief. See Dkt. No. 23. 22 On September 13, 2019, Mr. Alcaraz filed an ex parte application for a TRO. Dkt. No. 28. 23 The Court ordered that Mr. Alcaraz serve the defendants and set a hearing on the TRO for October 24 11, 2019. Dkt. No. 33. Altezza filed an opposition to the TRO application and filed an answer to 25 the second amended complaint. Dkt. Nos. 30, 35. On October 11, 2019, after holding a hearing at 26 4 Mr. Alcaraz explains further in his declaration, “I asked Ms. Fox as to why Altezza would 27 not sell to me, and her response was to the effect of: ‘I don’t think they like you.’ When I asked her 1 which Altezza appeared, the Court granted Mr. Alcaraz’s application for a TRO. Dkt. No. 38. The 2 Court enjoined “defendants (or their officers, agents, servants, employees, and attorneys) and the 3 Alameda County Sheriff’s Office from proceeding on the execution of the writ of possession 4 obtained in Alameda County Superior Court with regard to the residence at which Alcaraz resides 5 at 6465 San Pablo Avenue, Unit 403, Oakland, California, pending resolution of Alcaraz’s motion 6 for a preliminary injunction.” Id. at 9. The Court set a hearing on the motion for preliminary 7 injunction for December 6, 2019, and ordered that Mr. Alcaraz post a bond in the amount of 8 $5,000.00 by October 18, 2019. Id. 9 Mr. Alcaraz requested and received a one-week extension of time to post the bond. Dkt. 10 Nos. 40, 42. When he failed to post a bond by the new date, the Court issued an order on November 11 7, 2019, ordering that he post the bond “IMMEDIATELY.” Dkt. No. 54. Mr. Alcaraz posted a 12 bond on November 8, 2019, but the payment was returned for insufficient funds. See Dkt. Nos. 56, 13 57. 14 In the meantime, on November 1, 2019, with the Court’s permission, Altezza filed a motion 15 to dismiss the second amended complaint. Dkt. No. 51. On December 5, 2019, the Court denied in 16 part and granted in part the motion to dismiss. Dkt. No. 64. The Court rejected Altezza’s argument 17 that res judicata barred the claims of the present lawsuit based on the proceedings in a separate 18 contract action Mr. Alcaraz brought against Altezza in state court in January 2018. The Court also 19 denied the motion to dismiss the Fair Housing Act claim and claim for injunctive relief. The Court 20 granted the motion to dismiss the Fourteenth Amendment claim, with leave to amend. 21 Prior to the hearing on the motion for preliminary injunction and before Mr. Alcaraz’s 22 amended complaint came due, the Court stayed the case and referred Mr. Alcaraz to the Federal Pro 23 Bono Project for appointment of counsel. See Dkt. No. 67. On March 11, 2020, the Court appointed 24 pro bono counsel for Mr. Alcaraz and issued an order setting further deadlines.5 25 On April 22, 2020, Mr. Alcaraz, through newly appointed counsel, filed a third amended 26

27 5 The Order included a new deadline for Mr. Alcaraz to post his $5,000 bond. Mr. Alcaraz 1 complaint along with a motion for preliminary injunction. TAC; Dkt. No. 76 (“Prelim. Inj. Mot.”). 2 The third amended complaint, which is now the operative complaint, names as defendants KMF 3 Oakland LLC; Klingbeil Capital Management, Ltd.; and Altezza Condo LLC.6 Mr. Alcaraz raises 4 four claims for relief: discrimination on the basis of race, color, and/or national origin in violation 5 of the Fair Housing Act, 42 U.S.C. § 3601 et seq. (“Claim One”); discrimination on the basis of race 6 in violation of the Fair Employment and Housing Act (“FEHA”), Cal. Gov’t Code § 12900 et seq. 7 (“Claim Two”); discrimination on the basis of race, color, ancestry, and/or national origin in 8 violation of the Unruh Civil Rights Act, Cal. Civ. Code §§ 51-52 (“Claim Three”); and 9 discrimination on the basis of race, color, ancestry, and/or national origin in violation of the Unfair 10 Competition Law (“UCL”), Cal. Bus. and Profs. Code § 17200 et seq. (“Claim Four”). 11 On May 6, 2020, Altezza filed an opposition to the motion for preliminary injunction along 12 with a motion to dismiss and to strike certain language from the third amended complaint. Dkt. 13 Nos. 86 (“Prelim. Inj. Opp’n”), 90 (“Mot. to Dismiss”). The Court held a telephonic hearing on the 14 motion for preliminary injunction and the motion to dismiss on June 11, 2020. 15 16 LEGAL STANDARDS 17 I. Motion to Dismiss 18 Under Federal Rule of Civil Procedure 12(b)(6), a district court must dismiss a complaint if 19 it fails to state a claim upon which relief can be granted. To survive a Rule 12(b)(6) motion to 20 dismiss, the plaintiff must allege “enough facts to state a claim to relief that is plausible on its face.” 21

22 6 Klingbeil Capital Management was the management company of The Emerson when KMF Oakland owned the building and is “an indirect parent company of, and/or shares a parent company 23 with,” KMF Oakland. TAC ¶¶ 4-5. On May 29, 2020, after the deadline to answer had passed, defendant KMF and Klingbeil Capital Management (“Klingbeil Defendants”) entered their first 24 appearance in this case. See Dkt. No. 99. Mr. Alcaraz and the Klingbeil Defendants then filed a 25 stipulation, which the Court approved, specifying that: the Klingbeil Defendants will take no actions, during the pendency of this action or after final judgment, to effectuate plaintiff’s eviction 26 from his home; the Klingbeil Defendants will not oppose plaintiff’s motion for a preliminary injunction and will not be the subject of any preliminary injunctive relief ordered by the Court 27 pursuant to that motion; that plaintiff will not seek the relief specified in paragraphs H & I of the 1 Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). This “facial plausibility” standard requires 2 the plaintiff to allege facts that add up to “more than a sheer possibility that a defendant has acted 3 unlawfully.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Although courts do not require 4 “heightened fact pleading of specifics,” Twombly, 550 U.S. at 544, a plaintiff must provide “more 5 than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not 6 do.” Id. at 555. The plaintiff must allege facts sufficient to “raise a right to relief above the 7 speculative level.” Id. 8 In deciding whether the plaintiff has stated a claim, the Court must assume that the plaintiff’s 9 allegations are true and must draw all reasonable inferences in his or her favor. Usher v. City of Los 10 Angeles, 828 F.2d 556, 561 (9th Cir. 1987). However, the court is not required to accept as true 11 “allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable 12 inferences.” St. Clare v. Gilead Scis., Inc., 536 F.3d 1049, 1055 (9th Cir. 2008). Moreover, “the 13 tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable 14 to legal conclusions.” Iqbal, 556 U.S. at 678. 15 16 II. Motion to Strike 17 Federal Rule of Civil Procedure 12(f) provides that a court may, on its own or on motion, 18 “strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or 19 scandalous matter.” The function of a Rule 12(f) motion to strike is to avoid the expenditure of time 20 and money that arises from litigating spurious issues by dispensing of those issues before 21 trial. Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527 (9th Cir. 1993), rev’d on other grounds, 510 22 U.S. 517 (1994). However, motions to strike are generally disfavored. Rosales v. Citibank, Fed. 23 Sav. Bank, 133 F. Supp. 2d 1177, 1180 (N.D. Cal. 2001). In most cases, a motion to strike should 24 not be granted unless “the matter to be stricken clearly could have no possible bearing on the subject 25 of the litigation.” Platte Anchor Bolt, Inc. v. IHI, Inc., 352 F. Supp. 2d 1048, 1057 (N.D. Cal. 2004). 26 27 III. Motion for Preliminary Injunction 1 to obtain a preliminary injunction, a plaintiff “must establish that he is likely to succeed on the 2 merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the 3 balance of equities tips in his favor, and that an injunction is in the public interest.” Winter v. 4 Natural Res. Def. Council, 555 U.S. 7, 20 (2008) (citations omitted). Courts have also applied an 5 alternative “sliding scale” or “serious questions” test, requiring that the plaintiff raise “serious 6 questions going to the merits” and show that “the balance of hardships tip[s] sharply in plaintiff’s 7 favor.” See Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1131-32 (9th Cir. 2011); id. at 8 1135 (stating plaintiff must also show a “likelihood of irreparable injury and that the injunction is 9 in the public interest.”). The sliding scale approach allows courts to balance the factors, offering 10 flexibility where, for example, the plaintiff makes a weaker showing of likelihood of success, but a 11 strong showing of irreparable harm.7 Id. at 1131. Regardless of the approach, a preliminary 12 injunction is an “extraordinary remedy that may only be awarded upon a clear showing that the 13 plaintiff is entitled to such relief.” Winter, 555 U.S. at 22; see also Earth Island Inst. v. Carlton, 14 626 F.3d 462, 469 (9th Cir. 2010) (plaintiffs “face a difficult task in proving that they are entitled 15 to this ‘extraordinary remedy[.]’”). 16 A preliminary injunction “should not be granted unless the movant, by a clear showing, 17 carries the burden of persuasion.” Mazurek v. Armstrong, 520 U.S. 968, 972 (1997) (citation 18 omitted). However, “[d]ue to the urgency of obtaining a preliminary injunction at a point when 19 there has been limited factual development, the rules of evidence do not apply strictly to preliminary 20 injunction proceedings.” Herb Reed Enters., LLC v. Fla. Entm’t Mgmt., Inc., 736 F.3d 1239, 1250 21 n.5 (9th Cir. 2013) (citing Republic of the Philippines v. Marcos, 862 F.2d 1355, 1363 (9th Cir. 22 1988)). 23 24 7 Winter did not completely reject the validity of the sliding scale approach to preliminary 25 injunctions. Alliance for the Wild Rockies, 632 F.3d at 1134. Under the “sliding scale” approach used in the Ninth Circuit – also dubbed the “serious question” test in Alliance for the Wild Rockies 26 – “the elements of the preliminary injunction test are balanced, so that a stronger showing of one element may offset a weaker showing of another.” Id. at 1131. Thus, even after Winter, “‘serious 27 questions going to the merits’ and a hardship balance that tips sharply toward the plaintiff can 1 DISCUSSION 2 I. Defendant’s Motion to Dismiss and Motion to Strike 3 The Court first addresses defendant Altezza’s motion to dismiss the third amended complaint 4 and to strike certain claims, because resolution of the motion to dismiss may impact the Court’s 5 analysis of the preliminary injunction motion. 6 Altezza argues: (1) the Court should dismiss Claim Two for failure to exhaust administrative 7 remedies under FEHA, (2) the Court should dismiss Claim Four for failure to state sufficient facts 8 under the UCL, and (3) the Court should strike language relating to Claims Two and Four along 9 with language that requests an injunction, as Altezza argues that remedy is not available. 10 11 A. Claim Two: FEHA 12 Altezza requests that the Court dismiss Mr. Alcaraz’s claim under FEHA because Mr. 13 Alcaraz has failed to exhaust administrative remedies, to wit, that he failed to first “file a written 14 charge with the California Department of Fair Housing (‘DFEH’) within one year of the alleged 15 unlawful discrimination and obtain a notice from DFEH of the right to sue . . . .”8 Mot. to Dismiss 16 at 10. Mr. Alcaraz does not dispute that he did not exhaust but counters that the administrative 17 exhaustion requirement applies only to allegations of discrimination in the employment context and 18 that there is no exhaustion requirement under FEHA for housing discrimination. Dkt. No. 94 19 (“Opp’n to Mot. to Dismiss”) at 11-12. 20 Mr. Alcaraz is correct. California Government Code section 12989.1, governing the 21 commencement of civil actions regarding housing discrimination under FEHA, states, in part, “An 22 aggrieved person may commence a civil action whether or not a complaint has been filed under this 23 part and without regard to the status of any complaint.” Cal. Gov’t Code § 12989.1; see also Wood 24 v. Vista Manor Nursing Ctr., No. C 06-01682 JW, 2006 WL 2850045, at *5 (N.D. Cal. Oct. 5, 2006) 25 (distinguishing FEHA claims of employment discrimination from housing discrimination and 26 finding that the Court may hear the latter regardless of administrative exhaustion). Defendant 27 1 appears to concede as much by failing to address the FEHA exhaustion argument at all in its reply 2 brief. See Dkt. No. 98 (“Reply ISO Mot. to Dismiss”). 3 The Court DENIES Altezza’s motion to dismiss Claim Two. 4 5 B. Claim Four: UCL 6 Regarding the UCL claim, Altezza argues that Mr. Alcaraz (1) has failed to allege that he 7 “suffered injury in fact and has lost money or property as a result of [the] unfair competition” and 8 (2) that he “fails to plead a violation of an underlying law upon which he purports to rest his UCL 9 claim.” Mot. to Dismiss at 11 (quoting Cal. Bus. & Prof. Code § 17204). 10 Under the UCL, a litigant must have “suffered injury in fact and . . . lost money or property 11 as a result of the unfair competition” in order to have statutory standing. Cal. Bus. & Prof. Code 12 § 17204. This means that a party suing for violation of the UCL must “(1) establish a loss or 13 deprivation of money or property sufficient to qualify as injury in fact, i.e., economic injury, and (2) 14 show that that economic injury was the result of, i.e., caused by, the unfair business practice . . . that 15 is the gravamen of the claim.” Kwikset Corp. v. Super. Ct., 51 Cal. 4th 310, 322 (2011). The 16 California Supreme Court has explained that “[t]here are innumerable ways in which economic 17 injury from unfair competition may be shown. A plaintiff may (1) surrender in a transaction more, 18 or acquire in a transaction less, than he or she otherwise would have; (2) have a present or future 19 property interest diminished; (3) be deprived of money or property to which he or she has a 20 cognizable claim; or (4) be required to enter into a transaction, costing money or property, that 21 would otherwise have been unnecessary.” Id. at 323. “This list is not exhaustive, however, and a 22 private plaintiff need only establish that he or she has ‘personally suffered such harm.’” Cappello 23 v. Walmart Inc., 394 F. Supp. 3d 1015, 1019 (N.D. Cal. 2019) (quoting Kwikset, 51 Cal. 4th at 323). 24 As the California Supreme Court has explained, the purpose of the economic injury requirement of 25 the UCL, as enacted into law in 2004 via Proposition 64, is “to eliminate standing for those who 26 have not engaged in any business dealings with would-be defendants and thereby strip such 27 unaffected parties of the ability to file ‘shakedown lawsuits,’ while preserving for actual victims of 1 51 Cal. 4th at 317; see also id. at 320-21. 2 The third amended complaint alleges numerous facts that, if true, suffice to meet the standing 3 requirement under the UCL. For instance, plaintiff alleges that on August 26, 2016, he received a 4 letter from Mark Chow, from Altezza’s real estate marketing and sales firm, stating that Altezza 5 “would like to provide you the first opportunity to purchase your unit at the price below: . . . 6 $630,000.” TAC ¶ 35; TAC Ex. N at 2-3 (Aug. 26, 2016 Mark Chow Letter). The letter included 7 contact information for a mortgage lender and stated, “Please contact the Mortgage Consultant 8 below to begin the process of qualifying for a mortgage loan for the purchase of your unit.” TAC 9 Ex. N at 3. Mr. Alcaraz further alleges that on September 30, 2016, Mr. Chow told him over the 10 phone that Altezza “would be happy to sell to Mr. Alcaraz as the occupant.” TAC ¶ 36. Mr. Alcaraz 11 memorialized the call in an email that same day, stating, 12 In summary, my understanding from our call is that the sale price of unit number 403 will be $630,000 and that a letter will be forthcoming in mid-October detailing the 13 mechanics of the sale/escrow process. 14 As I mentioned this morning, I currently have one of my properties in Mexico for sale that will net around $389,000 in proceeds that I will use for the purchase of the 15 unit in Oakland. The rest will come from funds that I have liquid. 16 I would like to reiterate that I will be moving forward with the purchase of unit number 403 at 6465 San Pablo Avenue in Oakland (California), that it will be an all 17 cash sale, and that I would like to expeditiously move towards closing. 18 TAC Ex. O at 2. Mr. Alcaraz further alleges that he subsequently “went through with the sale of 19 the property in Mexico in order to be ready to purchase the unit.” TAC ¶ 37. In late 2017, Mr. 20 Alcaraz learned that Altezza would not sell him his unit, id. ¶ 42, and to this date he has not 21 succeeded in purchasing his unit. 22 Mr. Alcaraz alleges, 23 As a result of defendants’ discrimination, Mr. Alcaraz lost the opportunity to purchase his home. Likewise, because of defendants’ evasive delay tactics when he 24 believed a sale was still possible, he lost out on years of opportunity to purchase another condominium in Oakland at a similar price. 25 []Now, there are no condominiums in Oakland available for sale at a price equivalent 26 to the fair market price at which he agreed to purchase his home—$630,000. In 2016, when Mr. Alcaraz agreed to purchase his home, there may have been other 27 condominiums in Oakland affordable to Mr. Alcaraz. However, in the years that climbed such that there are no longer condominiums in the city affordable to Mr. 1 Alcaraz. 2 Id. ¶¶ 50-51. 3 These allegations, if true, more than suffice to meet the standing requirement under the UCL. 4 Mr. Alcaraz has alleged that because Altezza led him to believe that he would be able to purchase 5 his unit in Oakland, he was “required to enter into a transaction, costing money or property,” i.e., 6 the sale of his property in Mexico, “that would otherwise have been unnecessary.” See Kwikset, 51 7 Cal. 4th at 323. Mr. Alcaraz has also alleged that he has had a “present or future property interest 8 diminished” because Altezza engaged in “evasive delay tactics” such that Mr. Alcaraz wasted over 9 a year of time trying to purchase his unit and that climbing real estate prices mean he can no longer 10 afford a condominium in Oakland. See id.; TAC ¶¶ 50-51. These are not “conclusory” statements, 11 as Altezza argues. See Reply ISO Mot. to Dismiss at 6. Rather, Mr. Alcaraz has provided detailed 12 allegations throughout the TAC that, if true, would show he suffered economic injury sufficient to 13 survive a motion to dismiss. 14 Nor does the UCL claim fail to plead a violation of any underlying law. As Mr. Alcaraz 15 notes in his opposition, the UCL claim for relief incorporates by reference the claims raising 16 violations of the FHA, FEHA, and the Unruh Act. Opp’n to Mot. to Dismiss at 12; TAC ¶ 70. In 17 its reply brief, Altezza does not pursue this argument further. 18 The Court DENIES Altezza’s motion to dismiss Claim Four. 19 20 C. Injunctive Relief 21 Pursuant to Federal Rule of Civil Procedure 12(f), Altezza also moves to strike Mr. Alcaraz’s 22 request for injunctive relief. Altezza argues that none of Mr. Alcaraz’s causes of action provide for 23 the injunctive relief that he seeks in the third amended complaint, namely, his request that the Court: 24 I. Preliminarily and permanently enjoin defendants (or their officers, agents, servants, employees, and attorneys) and/or the Alameda County Sheriff’s Office 25 from proceeding on the execution of the writ of possession obtained in Alameda County Superior Court with regard to the residence at which Mr. Alcaraz resides at 26 6465 San Pablo Avenue, Unit 403, Oakland, California, from taking any other measures to effectuate evicting Mr. Alcaraz from his home, and from selling Mr. 27 Alcaraz’s home to any buyer other than Mr. Alcaraz. J. Issue an order compelling defendant Altezza Condo, LLC to sell plaintiff his 1 home at the $630,000 price agreed to in 2016. 2 TAC at 14; Mot. to Dismiss at 12-15; Reply ISO Mot. to Dismiss at 14-15. Altezza also argues that 3 Mr. Alcaraz is attempting to relitigate the state court UD Action and that res judicata bars him from 4 doing so.9 5 Mr. Alcaraz opposes on several grounds. First, Mr. Alcaraz urges that Altezza has waived 6 this argument because it could have litigated this in its prior motion to dismiss, and that Rule 12(g) 7 bars Altezza from raising this defense now. Mr. Alcaraz argues that the federal Fair Housing Act 8 allows for the injunctive relief that he seeks. Mr. Alcaraz also avers that the UD Action does not 9 bar his requested relief, under the law of the case and under res judicata. 10 Federal Rule of Civil Procedure 12(g) states that, except for certain circumstances not 11 present here, “a party that makes a motion under this rule must not make another motion under this 12 rule raising a defense or objection that was available to the party but omitted from its earlier motion.” 13 See Fed. R. Civ. P. 12(g)(2). The Court agrees with Mr. Alcaraz that Altezza’s request to strike the 14 prayer for certain injunctive relief was available to Altezza but omitted from its motion to dismiss 15 the second amended complaint, which Altezza filed in November 2019. Compare Dkt. No. 23 16 (“SAC”) at 19 with TAC at 14. Indeed, Altezza moved to dismiss the claim for injunctive relief 17 from the SAC but made only a cursory argument in support of this point. See Dkt. No. 51-1 (“Mot. 18 to Dismiss SAC”) at 14. To the extent that Altezza argues the TAC requests a new form of relief 19 that Mr. Alcaraz did not previously seek, namely, an injunction preventing the sale of plaintiff’s unit 20 to anyone other than him, the Court examines this further as part of its analysis on the preliminary 21 injunction motion, infra. 22 Likewise, in its prior motion to dismiss, Altezza could have but did not raise its argument 23 that the UD Action has res judicata effect barring Mr. Alcaraz’s requested relief. The Court noted 24 in its December 2019 Order Denying in Part and Granting in Part Motion to Dismiss, “Altezza does 25 not argue that the Unlawful Detainer Action precludes the instant action. Regardless, due to their 26 9 Altezza also requests the Court strike any references to FEHA or the UCL from plaintiff’s 27 prayer for relief. Mot. to Dismiss at 12. Because the Court has denied Altezza’s motion to dismiss 1 summary nature, unlawful detainer proceedings have limited res judicata effect. Madrid v. KMF 2 Fremont, LLC, No. 11-CV-05804 NC, 2012 WL 12883829, at *3 (N.D. Cal. Apr. 19, 2012).” Dkt. 3 No. 64 at 5 n.4. The Court will not now allow Altezza a second bite at the apple to argue that the 4 UD Action should preclude the racial discrimination claims raised in this case. 5 Accordingly, defendant Altezza’s motion to dismiss the third amended complaint is 6 DENIED. 7 8 II. Plaintiff’s Motion for Preliminary Injunction 9 Mr. Alcaraz requests a preliminary injunction “effectively extending the relief accorded in 10 the temporary restraining order to endure for the remainder of this litigation, until he has had a full 11 opportunity to prevail on the merits of his housing discrimination claims.” Prelim. Inj. Mot. at 8. 12 Specifically, he requests 13 a preliminary injunction, effective during the whole pendency of this action, prohibiting Defendants (or their officers, agents, servants, employees, and attorneys) 14 and/or the Alameda County Sheriff’s Office from proceeding on the execution of the writ of possession obtained in Alameda County Superior Court with regard to the 15 residence at which Mr. Alcaraz resides at 6465 San Pablo Avenue, Unit 403, Oakland, California, from taking any other measures to effectuate evicting Mr. 16 Alcaraz from his home, and from selling Mr. Alcaraz’s home to any buyer other than Mr. Alcaraz. 17 Id. at 27. 18 In opposition, Altezza argues that Mr. Alcaraz cannot show a likelihood of success on the 19 merits because he is not entitled to the injunctive relief he seeks. Altezza also argues the equities 20 cut against an injunction, stating that Altezza will be irreparably harmed if Mr. Alcaraz is allowed 21 to remain in his unit any longer. Finally, in the alternative, Altezza asks that the Court require a 22 bond if a preliminary injunction issues. 23 As explained below, the Court finds that all four of the Winter factors weight in favor of the 24 issuance of a preliminary injunction and that an injunction should therefore issue. 25

26 A. Likelihood of Success 27 “The first factor under Winter is the most important—likely success on the merits.” Garcia 1 v. Google, Inc., 786 F.3d 733, 740 (9th Cir. 2015) (citation omitted). Courts treat likelihood of 2 success as a “threshold inquiry,” disregarding the other factors when a plaintiff fails to show a 3 likelihood of success on the merits. See id. In his motion, Mr. Alcaraz focuses on the likelihood of 4 success on his Fair Housing Act claim, and so too will the Court’s analysis here. See Prelim. Inj. 5 Mot. at 16-22; see also Walker v. City of Lakewood, 272 F.3d 1114, 1131 (9th Cir. 2001) (applying 6 the same standards to FHA and FEHA claims) (citing Sada v. Robert F. Kennedy Med. Ctr., 56 Cal. 7 App. 4th 138, 150 n. 6 (1997)). 8 9 1. Fair Housing Act—Legal Standard 10 With certain limited exceptions, the federal Fair Housing Act makes it unlawful-- 11 (a) To refuse to sell or rent after the making of a bona fide offer, or to refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny, a dwelling 12 to any person because of race, color, religion, sex, familial status, or national origin. 13 (b) To discriminate against any person in the terms, conditions, or privileges of sale or rental of a dwelling, or in the provision of services or facilities in connection 14 therewith, because of race, color, religion, sex, familial status, or national origin. 15 . . . 16 (d) To represent to any person because of race, color, religion, sex, handicap, familial status, or national origin that any dwelling is not available for inspection, sale, or 17 rental when such dwelling is in fact so available. . . . 18 42 U.S.C. § 3604. 19 The Ninth Circuit “‘appl[ies] Title VII discrimination analysis in examining Fair Housing 20 Act discrimination claims.’ [Citation.] A plaintiff can establish a FHA discrimination claim under 21 a theory of disparate treatment or disparate impact.” Harris v. Itzhaki, 183 F.3d 1043, 1051 (9th 22 Cir. 1999) (citing Gamble v. City of Escondido, 104 F.3d 300, 304-05 (9th Cir. 1997)).10 23 As such, the Ninth Circuit has adapted the McDonnell Douglas burden-shifting framework 24 to the Fair Housing Act context. Under McDonnell Douglas Corporation v. Green, 411 U.S. 792 25 (1973), a plaintiff alleging disparate treatment “must first establish a prima facie case of 26 discrimination[.]” See Cmty. House, Inc. v. City of Boise, 490 F.3d 1041, 1053 (9th Cir. 2007) 27 1 (citation omitted). 2 Adapted to this situation, the prima facie case elements are: (1) plaintiff’s rights are protected under the FHA; and (2) as a result of the defendant’s discriminatory 3 conduct, plaintiff has suffered a distinct and palpable injury.[] Establishing the prima facie case affords the plaintiff a presumption of discrimination. This test does not 4 permit the court to consider rebuttal evidence at the prima facie case stage. 5 After the plaintiff has established the prima facie case, the burden then must shift to the defendant to articulate some legitimate, nondiscriminatory reason for the action. 6 To accomplish this, the defendant is only required to set forth a legally sufficient explanation. 7 Assuming the defendant can successfully rebut the presumption of discrimination, 8 the burden shifts back to the plaintiff to raise a genuine factual question as to whether the proffered reason is pretextual. A plaintiff may succeed in persuading the court 9 that she has been a victim of intentional discrimination, “either directly by persuading the court that a discriminatory reason more likely motivated the 10 [defendant] or indirectly by showing that the [defendant’s] proffered explanation is unworthy of credence.” The trier of fact may consider the same evidence that the 11 plaintiff introduced to establish a prima facie case in determining whether the defendant’s explanation is merely pretext. Id. “Once a prima facie case is 12 established . . . summary judgment for the defendant will ordinarily not be appropriate on any ground relating to the merits because the crux of a [discrimination 13 claim] is the elusive factual question of intentional discrimination.” 14 Harris, 183 F.3d at 1051 (citations omitted). 15 The McDonnell Douglas burden-shifting framework does not apply where the plaintiff is 16 “able to advance direct evidence of discrimination.” Gilligan v. Jamco Devel. Corp., 108 F.3d 246, 17 250 (9th Cir. 1997) (citations omitted); see also Cmty. House, 490 F.3d at 1045-46 (finding district 18 court erred in applying McDonnell Douglas test in Fair Housing Act case involving a facially 19 discriminatory men-only shelter policy). 20 21 2. Application Here 22 In this case, the McDonnell Douglas framework applies because Mr. Alcaraz has not come 23 forward with direct evidence of discrimination. In his third amended complaint, plaintiff alleges the 24 following salient facts. In March 2011, KMF purchased the building where plaintiff resided. TAC 25 ¶ 14. Johnny Rodriguez managed the building for KMF. Id. ¶ 15. The first time Mr. Alcaraz and 26 Mr. Rodriguez interacted, Mr. Rodriguez asked if Mr. Alcaraz was at the building to perform 27 maintenance work. Id. ¶ 18. “Every so often after that, Mr. Rodriguez would ask of Mr. Alcaraz, 1 tenancy in the building.” Id. “On other occasions, Mr. Rodriguez told Mr. Alcaraz that he spoke 2 English well.” Id. Mr. Rodriguez also made other remarks, such as asking if Mr. Alcaraz’s car was 3 owned by his employer and telling “Mr. Alcaraz that he looked like he was more suited to perform 4 maintenance work at The Emerson than to be a tenant.” Id. 5 Plaintiff alleges that beginning in early 2015 he “began being assessed ‘late’ fees on rent 6 checks that he timely paid by mail. Id. ¶ 19. At the time, Bianca Rodriguez was responsible for 7 processing rent checks for the building and was in a romantic relationship with Mr. Rodriguez. Id. 8 ¶ 20. In mid-2015 Mr. Alcaraz began hand delivering his rent checks to Ms. Rodriguez at her office 9 in San Ramon, California. Id. ¶ 22. Despite calling ahead to confirm that she would be there to 10 accept the check, “on most of Mr. Alcaraz’s attempts to hand deliver the checks, Ms. Rodriguez 11 would no longer be in her office when Mr. Alcaraz arrived[,]” thereby forcing him to leave his rent 12 checks under her office door. His rent checks continued to be processed in an untimely manner, and 13 on at least one occasion Ms. Rodriguez said she did not receive Mr. Alcaraz’s check even though 14 he delivered it. Id. On September 24, 2015, KMF filed an unlawful detainer action against plaintiff 15 that it ultimately dismissed when the parties reached a new agreement on how to process Mr. 16 Alcaraz’s rent checks. Id. ¶¶ 23-24. “In early 2016, Klingbeil again failed to process Mr. Alcaraz’s 17 rent checks.” Id. ¶ 26. On March 11, 2016, KMF filed another unlawful detainer action against Mr. 18 Alcaraz for unpaid rent. Id. 19 After Altezza bought the building in June 2016, it initially accepted Mr. Alcaraz’s rent 20 payment. Id. ¶¶ 27-29. On August 1, 2016, KMF obtained a judgment of writ of possession in the 21 UD Action. Id. ¶ 33. In late August and September 2016, plaintiff had multiple communications 22 with Mark Chow from the real estate and marketing firm that Altezza hired; Mr. Chow told Mr. 23 Alcaraz that Altezza would like to sell Mr. Alcaraz’s unit to him at a price of $630,000. Id. ¶¶ 35- 24 36. Mr. Alcaraz made preparations to get the funds together to purchase the unit and informed Mr. 25 Chow that he planned to make an all cash purchase. Id. ¶¶ 36-38. In the meantime, in 2017, sales 26 agents for Altezza began selling units in the building. Id. ¶ 39. Mr. Alcaraz alleges that he “often 27 observed the sales agents’ behavior shift depending on the identity of the prospective buyers” and 1 be unfriendly, making the prospective buyer wait around for help while more quickly attending to 2 other prospective buyers.” Id. ¶ 40. 3 In late 2017, one of the sales agents, Amy Fox, “told Mr. Alcaraz that Altezza would not sell 4 him his home. She told him that the owners would sell to anyone but him. When Mr. Alcaraz asked 5 Ms. Fox why the owners would not sell to him, . . . Ms. Fox told him it was because they did not 6 like him.” Id. ¶ 42. Mr. Alcaraz further alleges that “[b]y mid-2018, all of the units in The Emerson, 7 except for Mr. Alcaraz’s home, had been sold at least once. None of the buyers were of Hispanic 8 descent. The units comparable to Mr. Alcaraz’s home were all sold in the range of $630,000.” Id. 9 ¶ 45. 10 The Court finds that these allegations, and the documentation plaintiff provides to support 11 them, suffice to establish a prima facie case of discrimination at this stage of the proceedings. Harris 12 v. Itzhaki is instructive.11 There, the Ninth Circuit reversed a district court’s grant of summary 13 judgment in favor of a landlord defending a claim of racial discrimination under the Fair Housing 14 Act. The plaintiff, an African American tenant, brought three independent claims under the FHA. 15 One of these was for eviction notices she received that were contrary to her landlord’s established 16 policy.12 Ms. Harris presented evidence that in December 1995 she overheard Ms. Waldman, a 17 fellow tenant who assisted the landlords in showing vacant apartments and in collecting rent checks, 18 state to the building repairman, “The owners don’t want to rent to Blacks.” 183 F.3d at 1048. “Ms. 19 Harris immediately informed Ms. Waldman that her comments were ‘illegal and racist.’” Id. Four 20 months later, the landlords stated they did not find Ms. Harris’s rent check in its usual place. The 21 same thing occurred the following month, “causing Ms. Harris to send all subsequent payments by 22 certified mail. Ms. Harris presented evidence that she suffered emotional distress as a result of the 23

24 11 Some courts have called into question the continuing viability of Harris’s holding on the question of standing under the FHA, following the Supreme Court’s decision in Thompson v. North 25 American Stainless, LP, 562 U.S. 170 (2011). See Lee v. Retail Store Employee Building Corp., No. 15-cv-04768-LHK, 2017 WL 346021, at *7 (N.D. Cal. Jan. 24, 2017). However, defendant has 26 not raised standing as a reason why plaintiff’s claim should fail, and the Court finds Harris to be instructive on the merits of an FHA discrimination claim. 27 1 notices and feared a racially motivated eviction in the future.” Id. at 1052. Although the landlords 2 had an “informal procedure” of calling a tenant whose rent had not been received by the tenth of the 3 month, Ms. Harris received no such call and instead received two notices to pay rent or quit, for 4 April 1996 and May 1996. Id. at 1049. Based on these facts, the Ninth Circuit found Ms. Harris 5 had established a prima facie disparate treatment claim under the FHA. Id. at 1052. The appellate 6 court further found that the landlords’ stated reasons for their actions—“that they simply didn’t get 7 the check and that the phone call is merely a courtesy to the tenant”—raised a genuine factual 8 question as to whether the landlords’ “nondiscriminatory reason is pretextual, thereby making 9 summary judgment inappropriate.” Id. 10 In this case, Mr. Alcaraz alleges multiple comments by KMF’s property manager indicating 11 surprise that Mr. Alcaraz could afford to live in the building and stating that Mr. Alcaraz looked 12 more suited to performing maintenance work. The individual with whom the property manager was 13 romantically involved began refusing or untimely processing Mr. Alcaraz’s rent checks, leading to 14 two eviction actions against him. After Altezza purchased the building, Altezza initially accepted 15 rent from Mr. Alcaraz and told him that it would sell him his unit at a price of $630,000, for which 16 he indicated he would pay in all cash. Altezza never followed through with the sale, and ultimately 17 its sales agent told Mr. Alcaraz that Altezza would not sell him his home “because they did not like 18 him.” TAC ¶ 42. Mr. Alcaraz observed sales agents acting unfriendly toward prospective buyers 19 who appeared to be Hispanic or African-American. By mid-2018, all of the other 32 units in the 20 building had been sold but none were sold to buyers of Hispanic descent. Taken together, these 21 allegations suffice to establish a prima facie case of disparate treatment. 22 In response, Altezza states that it never offered to sell Mr. Alcaraz his unit and that the “only 23 reason” it did not offer to sell him the unit “was because he was under eviction for non-payment of 24 rent when the units were being sold.” Burke Decl. ¶ 11. The Court finds this position unconvincing. 25 The judgment in the UD Action was entered August 1, 2016, and Mr. Alcaraz has come forward 26 with a letter dated August 26, 2016, from Mark Chow, addressed to Mr. Alcaraz, informing him that 27 Altezza “would like to provide [him] the first opportunity to purchase [his] unit” at the price of 1 Citibank. TAC Ex. N at 2-3. Altezza does not address this letter other than to object to it as hearsay 2 and lacking foundation and to say that Altezza had hired Level Four, where Mark Chow worked, 3 “to oversee the process of selling the condominiums” but that Altezza “never gave Level Four 4 authority to sell any of the units. Only Defendant, as the owner of the building, had authority to 5 agree to sell any of the condominiums.” Prelim. Inj. Opp’n at 17-18; Burke Decl. ¶ 7.13 Thus, 6 Altezza appears to have been moving forward with the sale of the unit to Mr. Alcaraz even after the 7 judgment of possession had been entered against him. Additionally, Mr. Alcaraz has raised 8 questions about whether the underlying UD Action was itself motivated by racial discrimination, 9 and it would make little sense for a racially motivated eviction to then be able to form the basis for 10 a legally valid refusal to sell Mr. Alcaraz his unit.14 11 Nor is the Court persuaded by Altezza’s argument that Mr. Alcaraz is not likely to succeed 12 on the merits of his claim because he is not entitled to the injunctive relief that he seeks. Altezza 13 argues that even if Mr. Alcaraz succeeds on his claims, he will not be entitled to an order prohibiting 14 Altezza from selling Mr. Alcaraz’s unit to anyone else, nor will he be entitled to an order that Altezza 15 must sell the unit to him. Prelim. Inj. Opp’n at 11. To start, setting aside the matter of whether the 16 requested relief is appropriate, Mr. Alcaraz will plainly be entitled to relief of any sort only if he 17 first succeeds on the merits, and Altezza’s argument does not go to the merits of plaintiff’s claim. 18 Altezza also cites the state court ruling in a prior contract action involving the same parties, but the 19 Court has already ruled that case does not have preclusive effect here. See Dkt. No. 64 at 7. Altezza 20 also argues that Mr. Alcaraz is seeking a “mandatory injunction, i.e. an order restraining Defendant 21 22 13 For purposes of this motion only, the Court OVERRULES Altezza’s evidentiary 23 objections to the August 26, 2016 Mark Chow letter. See Flynt Distrib. Co. v. Harvey, 734 F.2d 1389, 1394 (9th Cir. 1984) (“The trial court may give even inadmissible evidence some weight, 24 when to do so serves the purpose of preventing irreparable harm before trial.”).

25 14 Because Altezza does not argue otherwise, for purposes of this Order, the Court assumes, without deciding, that Johnny Rodriguez, Bianca Rodriguez, and Amy Fox were acting as agents of 26 the defendants when they made the statements at issue. See Harris, 183 F.3d at 1054 (holding that the “question whether an agency relationship exists for purposes of the Fair Housing Act is 27 determined under federal law, not state law[,]” and is a question that “should be submitted to the 1 from entering upon its own real property and from selling its own real property to whoever it wants, 2 which is ‘particularly disfavored[.]’” Prelim. Inj. Opp’n at 12 (citing Stanley v. Univ. of S. Cal., 13 3 F.3d 1313, 1320 (9th Cir. 1994)). The Court disagrees that Mr. Alcaraz seeks a mandatory 4 injunction. Rather, Mr. Alcaraz’s request that he not be evicted and that his unit not be sold to 5 anyone else during the pendency of this case is a “prohibitory injunction that preserves the status 6 quo.” Stanley, 13 F.3d at 1320 (citation omitted). As to Mr. Alcaraz’s request in the complaint for 7 an order that Altezza be compelled to sell him his unit for $630,000, this is not relief that Mr. Alcaraz 8 requests as part of the preliminary injunction, and the Court agrees with Mr. Alcaraz, see Dkt. No. 9 93 (“Reply ISO Prelim. Inj. Mot.”) at 8-9, that this matter need not be decided here today.15 10 Based on the above, the Court finds that at minimum plaintiff has raised “serious questions 11 going to the merits” of his FHA claim.” See Alliance for the Wild Rockies, 632 F.3d at 1131-32. 12 13 B. Irreparable Harm 14 Under the second Winter factor, the irreparable injury must be both likely and immediate. 15 See Winter, 555 U.S. at 22; Caribbean Marine Servs. Co., Inc. v. Baldrige, 844 F.2d 668, 674 (9th 16 Cir. 1988) (“A plaintiff must do more than merely allege imminent harm sufficient to establish 17 standing; a plaintiff must demonstrate immediate threatened injury as a prerequisite to preliminary 18 injunctive relief.”). As this Court previously observed when granting plaintiff’s motion for a 19 temporary restraining order, irreparable harm is nearly always presumed in cases such as these. See, 20 e.g., Cmty. House, 940 F.3d at 1048 (“It is undisputed that the balance of hardships tips in favor of 21 the plaintiffs who were excluded from Community House due to the men-only policy”); Silver Sage 22 Partners, Ltd. v. City of Desert Hot Springs, 251 F.3d 814, 827 (9th Cir. 2001) (“We have held that 23 where a defendant has violated a civil rights statute, we will presume that the plaintiff has suffered 24 15 The Court notes that in its opposition brief, Altezza supports its assertion that the FHA 25 does not provide for the remedy of forcing defendant to sell its property to plaintiff with a citation to 42 U.S.C. § 3612. That section governs enforcement of the FHA by the Secretary of Housing 26 and Urban Development. Section 3613 governs enforcement by private persons, and allows the court to enter, as it “deems appropriate, any permanent or temporary injunction, temporary 27 restraining order, or other order (including an order enjoining the defendant from engaging in such 1 irreparable injury from the fact of the defendant’s violation.”); Gresham v. Windrush Partners, Ltd., 2 730 F.2d 1417, 1424 (11th Cir. 1984) (“because of the subtle, pervasive, and essentially irremediable 3 nature of racial discrimination, proof of the existence of discriminatory housing practices is 4 sufficient to permit a court to presume irreparable injury.”). 5 Moreover, both parties appear to agree that, in the absence of an injunction, Altezza would 6 be actively seeking to effectuate the writ of possession on Mr. Alcaraz’s unit. In its reply brief in 7 support of its motion to dismiss, Altezza files a request for judicial notice, attaching an August 2019 8 order amending the complaint, judgment, and writ of possession in the UD Action to reflect the 9 plaintiff and payee to be Altezza Condo LLC, as well as a judgment in the UD Action re-entered in 10 Alameda County Superior Court in August 2019. Dkt. No. 97.16 “[W]rongful eviction is not an 11 injury for which remedies available at law are adequate.” Johnson v. Macy, 145 F. Supp. 3d 907, 12 920 (C.D. Cal. 2015). The Court finds this factor weighs in Mr. Alcaraz’s favor. 13 14 C. Balance of Equities 15 As the Court previously observed, if Mr. Alcaraz is evicted and his residential unit sold to 16 another buyer, then he will be unable to recover the full relief contemplated by the Fair Housing 17 Act, even if he ultimately prevails on that claim. Mr. Alcaraz and his family have resided in this 18 unit for over nine years, and the loss of the ability to purchase this particular unit is not one that can 19 be compensated for with money damages alone. 20 By contrast, the countervailing harms that Altezza cites are ones that can be compensated 21 22 16 Altezza has filed two requests for judicial notice, attaching various court documents from 23 prior state court actions involving Mr. Alcaraz. See Dkt. Nos. 91, 97. While “a court may take judicial notice of the existence of matters of public record, such as a prior order or decision,” it 24 should not, however, take notice of “the truth of the facts cited therein.” Marsh v. San Diego 25 Cnty., 432 F. Supp. 2d 1035, 1043 (S.D. Cal. 2006) (citations omitted). “[T]aking judicial notice of findings of fact from another case exceeds the limits of [Federal] Rule [of Evidence] 201.” Wyatt 26 v. Terhune, 315 F.3d 1108, 1114 (9th Cir. 2003), overruled on other grounds by Albino v. Baca, 747 F.3d 1162 (9th Cir. 2014). Accordingly, the Court GRANTS the requests for judicial notice at 27 Dkt. Nos. 91 and 97 to the extent defendant asks the Court take notice of the existence of the 1 with money damages. See Prelim. Inj. Opp’n at 15. Altezza asserts that if Mr. Alcaraz’s motion is 2 granted, Altezza would be irreparably harmed because it “has had and would continue to have no 3 way to access its own property to ensure it is being properly maintained or that Plaintiff is not 4 causing any damages.” Id. It asserts that Mr. Alcaraz’s continued occupancy of the unit is damaging 5 its value, but cites no evidence, other than a declaration stating the same, that Mr. Alcaraz is 6 inflicting any specific harm on the unit or that the inability to maintain the unit is causing irreparable 7 damage. See id. (citing Burke Decl. ¶ 14). 8 The Court concludes that the balance of hardships tips sharply in plaintiff’s favor under the 9 facts stated above. See Johnson, 145 F. Supp. 3d at 920-21 (finding “the balance of hardships tips 10 sharply in favor of plaintiff, who faces eviction—likely a wrongful one—from an affordable home 11 in which she has lived for over a decade” and granting preliminary injunction preventing her eviction 12 during the pendency of her FHA suit). 13 14 D. Public Interest 15 Altezza does not address the public interest factor, and this factor also weighs in favor of 16 Mr. Alcaraz. See United States v. Edward Rose & Sons, 384 F.3d 258, 264 (6th Cir. 2004) (“the 17 Supreme Court has found the FHA serves an ‘overriding societal priority’”) (citations omitted); 18 Johnson, 145 F. Supp. 3d at 921 (“In the FHA, Congress declared that ‘it is the policy of the United 19 States to provide, within constitutional limitations, for fair housing throughout the United States.’ 20 Accordingly, courts have emphatically declared that the public interest is served by effective 21 enforcement of the FHA.”) (citations omitted). 22 For the reasons stated above, the Court will GRANT plaintiff’s motion for a preliminary 23 injunction. 24 25 E. Bond 26 Rule 65(c) of the Federal Rules of Civil Procedure provides: “The court may issue a 27 preliminary injunction or a temporary restraining order only if the movant gives security in an 1 to have been wrongfully enjoined or restrained. . . .” Fed. R. Civ. P. 65(c). “The district court 2 retains discretion ‘as to the amount of security required, if any.’” Diaz v. Brewer, 656 F.3d 1008, 3 1015 (9th Cir. 2011) (quoting Johnson v. Couturier, 572 F.3d 1067, 1086 (9th Cir. 2009)). 4 Altezza asks that, if the Court is inclined to grant the motion for preliminary injunction, the 5 Court order Mr. Alcaraz “to post a bond of $3,500 from August 1, 2019 monthly until this case is 6 resolved and that the bond be paid directly to the client trust account of Perry Johnson Anderson 7 Miller & Moskowitz, LLP.” Prelim. Inj. Opp’n at 16. Altezza argues this is especially needed in 8 light of Mr. Alcaraz’s delay in paying the bond previously ordered, his recent filing of bankruptcy 9 actions, and his failure to pay filing fees on appeal in state court. Id. at 16-17. In reply, Mr. Alcaraz 10 argues that a bond is not necessary, particularly where he has already posted a bond of $5,000.00 in 11 this case. Reply ISO Prelim. Inj. Mot. at 12. Mr. Alcaraz notes also that the crux of his claim is 12 that, but for defendant’s unlawful discrimination, Mr. Alcaraz would already own his home and 13 would therefore not need to pay rent. Id. 14 The request for a bond is somewhat unusual here, in that Altezza steadfastly maintains that 15 Mr. Alcaraz is not a tenant, yet its request for $3,500 per month is one that it bases on local rents in 16 the area. See Burke Decl. ¶ 15. Other district courts that have issued preliminary injunctions during 17 the pendency of FHA claims similar to Mr. Alcaraz’s have not ordered bonds where the plaintiffs 18 were already paying rent during the pendency of the case. See Bischoff v. Brittain, No. 14-cv- 19 019709-KJM-CKD, 2014 WL 5106991, at *2, 9 (E.D. Cal. Oct. 10, 2014) (granting preliminary 20 injunction restraining landlord from evicting plaintiffs during pendency of FHA action so long as 21 plaintiffs remained current on rent); see also Johnson, 145 F. Supp. 3d at 920 (noting plaintiff had 22 never been untimely in paying her rent and there was no evidence that she would be unable to pay 23 her rent during the remainder of the litigation). 24 Given that Mr. Alcaraz is not currently paying rent, the Court finds a bond of $1,000.00 per 25 month is appropriate here. This amount is sufficient to provide a level of protection to Altezza’s 26 financial interests should Mr. Alcaraz not ultimately prevail on his claims, but is not so great as to 27 undermine plaintiff’s ability to gather the funds to purchase his unit, if that opportunity should result 1 the Court will apply that bond prospectively to the first five months of the bond payment due on the 2 preliminary injunction. 3 In other words, beginning on November 15, 2020, and no later than the 15th of each 4 month thereafter while this case is pending, Mr. Alcaraz shall post a bond, either individually 5 or through a surety, deposited to the Court’s registry, in the amount of $1,000.00. Mr. Alcaraz 6 may do this by depositing the funds, along with a copy of this Order, at the Intake desk at the Clerk’s 7 Office on the 16th Floor of the San Francisco Courthouse. 8 If, when Mr. Alcaraz’s bond comes due, shelter-in-place orders are still in effect, or if access 9 to the San Francisco Courthouse remains limited due to COVID-19, Mr. Alcaraz may post the bond 10 either: (1) by mail, post-marked no later than the 15th, or (2) in person, at the Clerk’s drop-box in 11 the lobby of the San Francisco Courthouse at 450 Golden Gate Avenue. The bond shall be in the 12 form of a check/money order or cashier’s check payable to “CLERK U.S. DISTRICT COURT” and 13 with the case name and case number on the payment. Mr. Alcaraz shall include with the payment a 14 copy of this Order. Mr. Alcaraz should retain a copy of the proof of payment for his records and 15 should email the Court’s Courtroom Deputy (Teddy_VanNess@cand.uscourts.gov) and the Court’s 16 Finance Department (Ana_Banares@cand.uscourts.gov) to inform them when the payment is 17 mailed or placed in the drop-box. 18 19 CONCLUSION 20 For the foregoing reasons and for good cause shown, the Court hereby DENIES defendant 21 Altezza Condo LLC’s motion to dismiss and motion to strike the Third Amended Complaint (Dkt. 22 No. 90). 23 The Court GRANTS plaintiff’s motion for a preliminary injunction (Dkt. No. 76). The Court 24 hereby GRANTS a preliminary injunction, effective during the whole pendency of this action, 25 prohibiting defendant Altezza Condo LLC (or its officers, agents, servants, employees, and 26 attorneys) and/or the Alameda County Sheriff’s Office from proceeding on the execution of the writ 27 of possession obtained in Alameda County Superior Court with regard to the residence at which Mr. 1 measures to effectuate evicting Mr. Alcaraz from his home, and from selling Mr. Alcaraz’s home to 2 any buyer other than Mr. Alcaraz. 3 Beginning November 15, 2020, Mr. Alcaraz shall post a bond of $1,000.00 per month for 4 the duration of this case, in the manner described above. 5 No later than June 25, 2020, each party to this case shall file an ADR Certification, as 6 || required by Civil L.R. 16-8(b) and ADR L.R. 3-5 (b). By that same date, the parties shall also file 7 a joint statement notifying the Court of their selection of an ADR process, as discussed at the 8 || hearing. See Dkt. No. 103. 9 10 IT IS SO ORDERED. 11 || Dated: June 12, 2020 Sate WU tee a SUSAN ILLSTON 13 United States District Judge

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