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Oral Argument Scheduled in Ninth Circuit Maui Vacation Rental Appeal

The Ninth Circuit has scheduled oral arguments in Maui Vacation Rental Association, Inc. v. County of Maui, No. 08-15251, the Ninth Circuit appeal from the Hawaii district court's dismissal of MVRA's complaint which sought to declare Maui's shut down of vacation rentals illegal. The court will hear argument on November 21, 2008, at 9:00 a.m. in Honolulu.

The issues in the case are spelled out in the briefs:

• Opening Brief of MVRA

• Answering Brief of the County of Maui

• Reply Brief of MVRA

The case and the issues have also been reported in the media:

• Los Angeles Times: Maui: Vacation rentals and B&Bs shut down and 50 illegal Maui B&Bs & vacation rentals shut down

• San Francisco Chronicle: Maui County closes unlicensed bed and breakfasts and vacation rentals

• The Maui News: Vacation rental suit dismissed in federal court

• Honolulu Star-Bulletin: Maui B&Bs face 'crisis'

• inversecondemnation.com: Federal Court Dismisses Vacation Rental Due Process Claims -- Details (with links to the District Court's opinion, MVRA's complaint, and the briefs in the district court)

Ninth Circuit: City's (Alleged) Failure to Enforce the Zoning Code Is Not A Substantive Due Process Violation (Oh, And Armendariz is Still Overruled)

In Shanks v. Byrd, No. 06-35665 (Aug. 27, 2008), the Ninth Circuit held that a municipality's alleged failure to enforce its zoning laws was not a violation of the Fourteenth Amendment.

Developers who convert homes into student residents apparently did not obtain all of the appropriate permits from Spokane, Washington to remodel a portion of a house in the city's Mission Avenue Historic District.  The city issued a building permit, but the Spokane zoning code requires additional permissions when historic landmarks are involved, and the developers did not seek or obtain a "certificate of appropriateness" or an "administrative special permit" from the city's Historic Landmark Commission.  The city did not object, and took no steps to require the permits.

A group of neighbors and community organizations sued the property owners and the city, alleging the city's failure to enforce the zoning code was a violation of their due process rights and a violation of a federal civil rights statute (42 U.S.C. § 1983), and violated the National Historic Preservation Act and the Spokane zoning code.  The district court dismissed the complaint for failure to state a claim, and the Ninth Circuit affirmed. 

Relying on Armendariz v. Penman, 75 F.3d 1311 (9th Cir. 1996), the city first claimed the due process claims were preempted by the Takings Clause.  The city asserted that the plaintiffs' claims that the city's action in not enforcing the zoning code caused a diminution in the value of the plaintiffs' property was a "takings" claim that must be asserted under the Fifth Amendment.  The court rejected the argument, noting that Armendariz was overruled in Crown Point Dev., Inc. v. City of Sun Valley, 506 F.23d 851 (9th Cir. 2007) (a decision we discussed here and here):

Expressly repudiating Squaw Valley's suggestion that a "substantive due process challenge brought in the context of regulating use of real property might not be viable," we recently held that "the Armendariz line of cases no longer can be understood to create a blanket prohibition of all property-related substantive due process claims."

Slip op. at 11834 (citing Action Apartment Ass'n, Inc. v. Santa Monica Rent Control Bd., 509 F.3d 1020, 1025 (9th Cir. 2007)).  The court noted that the plaintiffs were not seeking just compensation, but an invalidation of the land use action that was alleged to be "arbitrary and capricious." 

The court disposed of the substantive due process claim by first determining that the developers were not acting under color of state law, and the city had done nothing -- except, perhaps, failing to protect the plaintiffs from the negative consequences of the development -- that could be said to be "state action."  Slip op. at 11836.  Further, the court held that the failure to enforce the law was not "egregious official conduct" or an "abuse of power."  Id. at 11837.  "There is no evidence of a sudden change in course, malice, bias, pretext or indeed, anything more than a lack of due care on Spokane's part."  Id. at 11838.

Addressing the procedural due process claim, the Ninth Circuit held that the plaintiffs did not have a protected property interest in the proper application of the city's zoning code, because the code does not contain mandatory language constraining the city's conduct:

Logan Neighborhood does not have a legitimate claim of entitlement to the denial of the Dressels' permit in accordance with the historic preservation provisions.

Id. at 11841.  The Ninth Circuit summarily rejected the plaintiffs' NHPA argument because that statute does not create a private right of action.  The court also rejected the plaintiffs' state law claims for lack of a substantial federal question.

Read the full decision here.  Our thanks to Honolulu attorney Andy Beaman for alerting us to this case. 

Zoning Inspectors Need A Warrant

An interesting Sixth Circuit case summarized on Law of the Land by Professor Patty Salkin, Jacob v. Township of West Bloomfield, 531 F.3d 385 (6th Cir. July 3, 2008), which held that zoning inspectors are required by the Fourth Amendment's search and seizure clause must obtain a warrant if the zoning ordinance they are purporting to enforce can lead to criminal prosecution. 

I won't go into the details of the decision since Professor Salkin analyzes the case here, but the case is important since many zoning ordinances are criminal or quasi-criminal in nature.  The primary penalties for violation of Maui County's zoning ordinance, for example, are criminal, with the administrative enforcement process serving as an alternative -- or additional -- process. 

In Jacob, the property owner was actually prosecuted criminally, but the court held that this was not the determinative factor, and that a zoning inspector is not subject to the warrant requirement only if she is conducting a search for "purely administrative purposes."  Slip op. at 4.  The mere threat of criminal prosecution is enough to trigger the need to obtain a warrant.  The court spelled out other factors that led to the conclusion that a warrant should have been obtained:

Defendant specifically targeted his investigation at Plaintiff after receiving a complaint about the conditions of Plaintiff’s property, and he continued to single-out Plaintiff for continuing intrusions as Plaintiff failed to comply with the land use ordinance. Defendant did not search Plaintiff as part of a “routine inspection that is part of a periodic or area inspection plan.” Similarly, Plaintiff testified that he would frequently discover Defendant searching his property without any advance warning whatsoever; in other words, Defendant’s investigations were “conducted by surprise.”

Slip op. at 4-5 (citation omitted).

Zoning Can Regulate Use Of Property, Not Ownership

A noteworthy case from the North Carolina Court of Appeals about the limits of Euclidean zoning.  Although the decision was issued in March 2008, it seems no one else has posted on the case, so we will. 

In City of Wilmington v. Hill, 657 S.E.2d 670 (N.C. Ct. App. 2008), the court struck down a local ordinance that required the owner of a garage apartment to reside either in the main residence or the apartment.  When his permit to build a garage apartment was denied and he was cited for violation of the ordinance, the property owner asserted the owner-occupancy requirement was an unconstitutional regulation of his ownership of the property.

Relying on Graham Court Assoc. v. Town of Chapel Hill, 281 S.E.2d 418 (N.C. Ct. App. 1981), the court held that while the zoning power extends to regulating the use of property, it does not allow the government to control "the manner in which property is owned."  In that case, the court held that the government had no legitimate reason to deny a permit to convert an apartment complex from unitary ownership to condominiums in a zoning district where multi-family residential use was an allowable use, because "[t]he change in ownership from a single owner to multiple owners did not alter the property's character as to multi-family residential use." 

The Broadus court applied that rule to the owner-occupancy requirement for garage apartments, and held the requirement had "no foundation in reason and bears no substantial relation to the public health, the public morals, the public safety or the public welfare in its proper sense."  The court declined to follow Anderson v. Provo City Corp., 108 P.3d 701, 706 (Utah 2005) and  Kasper v. Town of Brookhaven, 142 A.D.2d 213, 220-21 (N.Y. 1988), which upheld owner-occupancy requirements from constitutional challenges.  The court noted these decisions are from other jurisdictions and it had no obligation to follow them, especially in light of the Graham Court rule:

In the instant case, the property in question is located in a district that is zoned for single-family residences; however, garage apartments are permitted as an accessory use, incidental and subordinate to the principal use as a single-family residence. See WLDC § 18-179 (2005). Garage apartments also are allowed in certain multi-family districts in connection with conforming single-family residences within the district. See WLDC § 18-285 (2005). Plaintiff only is entitled to regulate the use of defendant's single-family residence with the accessory use of a garage apartment, not the ownership.

(emphasis original).  Thanks to my Damon Key colleague Greg Kugle for sending this case my way.

Reply Brief in Ninth Circuit Maui Vacation Rental Appeal

Today we filed the Reply Brief (925kb pdf) in Maui Vacation Rental Association, Inc. v. County of Maui, No. 08-15251, the Ninth Circuit appeal from the Hawaii district court's dismissal of MVRA's complaint which sought to declare Maui's shut down of vacation rentals illegal.

I won't go into the details, since the Reply Brief spells out the arguments.  It responds to the arguments in the County of Maui's Answering Brief, posted here.  MVRA's Opening Brief, as well as links to media coverage of the case and issue, is posted here.

County of Maui's Brief in Ninth Circuit Vacation Rental Appeal

The County of Maui has filed its Answering Brief in Maui Vacation Rental Association, Inc. v. County of Maui, No. 08-15251, the Ninth Circuit appeal from the Hawaii district court's dismissal of MVRA's complaint which sought to declare Maui's shut down of vacation rentals illegal.

Our Opening Brief for MVRA is posted here, along with information about the issues in the case, which include what is necessary to plead a due process property interest, and what are elements of a claim for estoppel and vested rights under Hawaii law.

Opening Brief Filed in Ninth Circuit Maui Vacation Rental Appeal

Today we filed the Opening_Brief (250kb pdf) in Maui Vacation Rental Association, Inc. v. County of Maui, No. 08-15251, the Ninth Circuit appeal from the Hawaii district court's dismissal of MVRA's complaint which sought to declare Maui's shut down of vacation rentals illegal. 

I won't go into details of the case since the brief spells out the facts and arguments, but here are some prior posts on the case, and links to media coverage:

• Los Angeles Times: Maui: Vacation rentals and B&Bs shut down and 50 illegal Maui B&Bs & vacation rentals shut down

• San Francisco Chronicle: Maui County closes unlicensed bed and breakfasts and vacation rentals

• The Maui News: Vacation rental suit dismissed in federal court

• Honolulu Star-Bulletin: Maui B&Bs face 'crisis'

• inversecondemnation.com: Federal Court Dismisses Vacation Rental Due Process Claims -- Details (with links to the District Court's opinion, MVRA's complaint, and the briefs in the district court)

Order in Florida Short Term Rental Case

Here's the written order (1.8mb pdf) in Milo v. City of Venice, Case No. 2008 CA 552 SC (Mar. 17, 2008), the Florida case invalidating a municipality's restrictions on short term rentals that I posted earlier.  The case arose after the city's planning director determined that the local zoning ordinance restricted short term rentals in "residential" districts. 

The ruling is, of course, specific to Florida law, but there are two points worth noting:

• The court held that short term rental is not a "business" use.  "Indeed many rental properties, regardless of the duration of the rental term, are for profit ventures and could therefore be characterized as 'businesses.'"  Slip op. at 6.  The local code also permits temporary residences without limitation.

• Despite the rule that courts generally should defer to an agency's interpretation of regulations it administers, the court noted the rule that "[z]oning regulations are in derogation of private ownership rights and should be construed broadly in favor of property owners absent a clear intent to the contrary."  Slip op. at 5.  The court held that the municipality's failure to clearly define the term of tenancies in its code was fatal. 

Florida Court Invalidates Short Term Rental Restrictions

According to this report, a Florida state court has invalidated a municipality's attempt to regulate short-term rentals:

Milo [the property owner] bought more than a dozen homes on or near the island beginning in 2005 and started renting them out on a daily and weekly basis, something the city thought was addressed in -- and forbidden by -- its zoning ordinance.

[The court] didn't see it that way. In his seven-page decision, he said the city zoning code lacked key definitions and relied too heavily on state statutes -- statutes that weren't adequately referenced in its zoning code -- when making its case against Milo.

City officials thought they had a solid case, based on current code language and state rules that Planning and Zoning Director Tom Slaughter said in 2006 stipulate "the duration and frequency of rental of a single-family dwelling unit within the RSF (residential, single family) is restricted to not more than three rentals in a calendar year for periods of less than 30 days or one calendar month, whichever is less."

Download the complaint here.  Milo v. City of Venice, Case No. 2008 CA 552 SC (filed Jan. 11, 2008). 

Associated Press: "Hawaii: Tourists Make Lousy Neighbors"

In a story titled "Hawaii: Tourists Make Lousy Neighbors," the Associated Press summarizes the "transient vacation rental" issue that's been making waves on Oahu, Maui, and Kauai.  Only one county, the Big Island of Hawaii, does not actively regulate vacation rentals.  Not a very encouraging headline for an economy dependent upon tourism and welcoming visitors.

On a related note, Charley Foster at Planet Kauai expands on the inversecondemnation.com link to a story about the recent legal challenge to Sedona, Arizona's ban on short term rentals.  Charley adds a collection of links to case studies of how vacation rentals have been treated in other jurisdictions.  Check it out here.

Legal Challenge to Sedona, Arizona Short-Term Rental Ban

As reported here, a lawsuit was filed in Arizona state courts seeking to invalidate Sedona, Arizona's prohibition on short-term rentals (less than 30 days):

Approximately 450 short-term rental properties in Sedona have been impacted by the new Ordinance making it illegal to advertise short-term rentals, and the Code prohibiting short-term rentals.

This ordinance was enacted by the city council Jan. 22 to put teeth into the Code, on the books since 1995, which made it illegal to rent properties for less than 30-days

The tail end of the article lists the claims asserted by the plaintiffs, which include vested rights, selective enforcement, and other constitutional and statutory claims.

Maui Vacation Rental Ban in the News

The San Francisco Chronicle posts "Maui County closes unlicensed bed and breakfasts and vacation rentals," with background on the issue and the pending Ninth Circuit appeal.

In what is becoming a divisive battle - both in court and in residential neighborhoods - the owners of the B&Bs and rental homes charge that the new leadership of Maui County, which encompasses all three islands, has broken promises made by their predecessors to allow unlicensed properties to remain open, pending an overhaul of the cumbersome licensing process.

County inspectors began their crackdown last July, when about 20 properties were ordered to close, mainly in the Upcountry and North Shore areas of Maui.

Complete story here.  Check out the public comments on the story here. 

Disclosure: I represent the Maui Vacation Rental Association in its Ninth Circuit appeal.

Land Use Seminar: February 20, 2008

There's still time to register for the "Advanced Land Use and Zoning Law" seminar to be held on Wednesday, February 20, 2008 at the Ala Moana Hotel in Honolulu. 

Topics include vacation rentals, big box zoning, affordable housing exactions, landowner liability for rockfalls, an environmental law update, and a summary of recent key decisions from Hawaii and other jurisdictions on land use and related issues.  The faculty is comprised of my Damon Key Land Use Practice Group colleagues Greg Kugle, Mark Murakami, Robert Harris, and Noelle Catalan.  I'll be covering the topic "U.S. Supreme Court, Regulatory Takings, and Eminent Domain Update."

Full agenda and registration information here.  Hope you can make it -- if you do, stop by and say hello.

Land Use Round Up

A collection of interesting stories and posts regarding land use law:

• West Hawaii Today reports on a brewing dispute over the definition of land uses.  When is a use of land that involves golf balls and golf clubs not a "golf course?" "Golf course comes under fire -- by definition" (free registration may be required).

• UH Law Professor Carl Christensen guest blogs on PropertyProf Blog about the recent Hawaii Supreme Court decision in Office of Hawaiian Affairs v. Hous. & Community Dev. Corp. of Hawaii, No. 25570 (Jan. 31, 2008).  In that case, the court held that the "Apology Resolution," whereby Congress apologized for the U.S.'s role in the overthrow of the Hawaii monarchy, has the force and effect of substantive law. 

• Ilya Somin posts his thoughts on the Kelo follow-up case from the Second Circuit, Goldstein v. Pataki, here.  The comments that follow the post are also worth reviewing.  My thoughts are here.

• Wait a Second! (the blog of civil right cases from the Second Circuit) posts a summary of the Goldstein case here.

• Economic development takings analysis: John Ross of the Institute for Justice posts his commentary "Restricting eminent domain no hindrance to development" about the IJ's study showing that eminent domain reform has not limited the redevelopment ability of government.

How Appealing

The Maui News reports "Vacation rental group planning to appeal ruling" --

The Maui Vacation Rental Association will appeal U.S. District Judge Michael Seabright’s dismissal of its suit against Maui County to the 9th Circuit Court of Appeals.

President David Dantes said Wednesday that the association had retained a land use legal specialist, Robert Thomas of the Honolulu firm Damon Key Leong Kupchak Hastert, to handle the appeal.

He said that if the association wins its point and if the appeals court in California should remand the case to the Honolulu court, the association might have Maui lawyer James Fosbinder handle the renewal of the suit.

Seabright dismissed most of the association’s claims but left open an option of amending the complaint to allege civil rights violations.

Complete article here.  We posted about this case earlier here.

NY Times Catches a Recurring Vibe

In a story dated December 30, 2007 in the New York Times Travel section, "Not in My Tropical Backyard," Christoper Pala ties together several seemingly-unrelated threads: the Hawaii Superferry, development on Molokai, the Hokulia project on the Big Island, and expanded resort development on Oahu's North Shore.  The only issue that seems to have been left out is the question of vacation rentals.  The unstated thesis seems to be that these events are spurred, in large part by "backlash" against tourists and related development, but that seems like only part of the vibe -- and it may be more the "drawbridge protectionism" discussed in this post, and a perception that we're nearing capacity and things just aren't the way we remember them, than a specific anti-tourism or anti-outsider sentiment. 

Federal Court Dismisses Maui Vacation Rental Due Process Claims -- Details

The US District Court for the District of Hawaii dismissed most of the counts of the Maui Vacation Rental Association's complaint against the County of Maui.  The court held that MVRA had the right to bring suit on behalf of its members, but dismissed -- without leave to amend -- the substantive and procedural due process claims, the breach of contract claim, the breach of implied covenant of good faith and fair dealing claim, the equitable estoppel claim, and the illegal customs and policies claim.  The court also dismissed the equal protection claim, but allowed MVRA to amend its complaint. 

Here's the court's written order.  (The court's summary order also mentioned a "First Amendment" claim, but no such claim is mentioned in the written order.)

County Fails to Process 90% of Applications

Vacation rentals outside of the "Hotel" zones are generally prohibited.  Those vacation rentals that were not operating on their zoning lot before the prohibition must seek a permit from the County.  The County, however, has a huge backlog of permit applications, some stretching back for years, and the court noted that of the 80 applications for permits, only 8 have been granted, and up to 70 were never even processed by the County.  The County also advised property owners that they should not bother to apply for permits since new regulations were in the works. 

County's Nonenforcement Assurances

These new regulations were chimerical and never materialized, but for years the County had an official policy of not enforcing the ban.  In 2001, that policy culminated in a written agreement with MVRA, signed by the County's Planning Director, stating, among other things, that the County would not seek to enforce the prohibition against those who had filed permit applications, and agreeing they could continue to operate while their applications were under County's consideration.  The Planning Director also agreed that for those who did not file applications, the County would not actively seek out violators, but would only react to complaints by third parties.

"Sorry, We Changed Our Mind"

But after a new administration (and new Planning Director) took office, the County said in effect, "we changed our mind."  In July 2007, the County that all unpermitted vacation rentals -- even those who had filed an application -- would be shut down on January 1, 2008.  No exceptions. MVRA then sued the County in federal court seeking declaratory and injunctive relief preventing Maui from shutting down unpermitted vacation rentals.   

• MVRA's Complaint 
• County of Maui's motion to dismiss
• MVRA's memorandum in opposition
• MVRA's supplemental brief in opposition
• County of Maui's supplemental brief in support of motion to dismiss

More background on the lawsuit here, here (video), and here.   

Court: No Permit, No Property, No Rights

The court held that the plaintiff did not possess a property interest protected from arbitrary and capricious government action because the County's laws did not require it to issue vacation rental permits.  The court relied on the word "may," in the ordinances, holding that because the County could not be compelled to issue the permits, it had unfettered discretion to deny them:

The County maintains full discretion in determining whether to grant conditional permits and special use permits.  A conditional permit may be recommended ... [c]onditional use permits may be issued subject to such terms and conditions deemed reasonable and necessary...

Slip op. at 27 (emphasis original).  While that analysis has never made a lot of sense (shouldn't the Due Process Clause require, as a normative matter, that government not behave arbitrarily and capriciously?), a District Court can't rewrite circuit law, and the Ninth Circuit generally requires that a life, liberty, or property interest be at stake in substantive due process claims.  See, e.g., Action Apartment Ass'n v. City of Santa Monica, No. 05-56533 (9th Cir. Dec. 3, 2007).

The court, however, missed the critical property interest at stake in the case.  It was not the unissued vacation rental permits.  Rather, the property interest possessed by the plaintiff was the County's 2001 assurances it would not enforce the vacation rental prohibition, because when the government makes assurances upon which people rely, those promises are property protected from arbitrarily and capricious backpedaling:

the consent of individual officials representing the United States cannot "estop" the United States ... it can lead to the fruition of a number of expectancies embodied in the concept of "property" expectancies that, if sufficiently important, the Government must condemn and pay for before it takes over the management of the landowner's property.

Kaiser Aetna v. United States, 444 U.S. 164, 179 (1979).  It appears the court incorrectly focused on the vacation rental permits as being the only possible "property" interest at stake in the case.

Federal Court Dismisses Most of Maui Vacation Rental Lawsuit

Hat tip to Supreme Court of Hawaii Blog for posting a Maui County press release announcing that on December 17, 2007, the US District Court for the District of Hawaii dismissed, for failure to state a claim, most of the allegations in the lawsuit by the Maui Vacation Rental Association.  The Maui News reports the story here, and Jesse Souki amalgamates his posts on the case at his Hawaii Land Use Law blog here. 

Failure to state a claim means either that a cause of action alleged by the plaintiff is not recognized, or, more commonly, that the plaintiff failed to properly plead an essential element of her legal claim.

Here's the court's summary order.  When the court issues its full written order, we'll post it.

Latest Briefs in Maui Vacation Rental Case

Here are the latest filings in the federal lawsuit by the Maui Vacation Rental Association against the County of Maui.  The court asked for further briefing on the due process claim.   The plaintiff's supplemental brief is here, and the County's supplemental brief is here.

Previous posts on the case, including prior briefs and other pleadings, are here, here (video), here, and here.  The hearing on the County's motion to dismiss is scheduled for December 19, 2007, at 9:00 a.m.

Update on Federal Lawsuit on Maui Vacation Rentals

The Maui News reports the US District Court has postponed a hearing in the lawsuit brought by the Maui Vacation Rental Association against the County of Maui to stop the County's attempt to shut down "vacation rentals" --

U.S. District Judge Michael Seabright has asked for additional legal research on the lawsuit by the Maui Vacation Rental Association that seeks to stop the county’s enforcement actions that will otherwise shut down almost all the short-term rentals on Maui.

In a hearing Monday, Seabright said, “I’m not Judge Judy,” but if he were, he’d have been ready to grant MVRA relief on fairness grounds.

Background on this case here, here (video), and here.   

MVRA's Complaint is posted here.  Shortly after the complaint was filed, MVRA moved for a preliminary injunction, which was opposed in this memorandum by the County.  The County also filed a separate motion to dismiss, to which MVRA filed a memorandum in opposition.  The hearing on MVRA's motion for a preliminary injunction was rescheduled to December 19, 2007, at 9:00 a.m.

Big Island: Bring Me Your Enthusiastic, Your Laden-With-Spending-Money Tourists, Yearning To Vacation Rent?

Check out this story from the Big Island's West Hawaii Today (free registration may be required), "Other counties' vacation rental laws could prove Big Island boon," which starts off with this theorem: "[t]he Big Island could soon experience a windfall of visitor dollars that would have otherwise flowed into Maui, Kauai and Honolulu."  In the article, the County of Hawaii's Planning Director contrasts the Big Island's treatment of short term (aka vacation) rentals with their treatment by the other three counties:

"We do enforce nonlicensed bed and breakfasts and rentals on agricultural land that are supposed to be farm dwellings," said Hawaii County Planning Director Chris Yuen. "But we're not engaged in any kind of crackdown on vacation rentals."

There's a reason the Big Island has escaped a controversy that could culminate next month with a federal lawsuit brought against Maui County by an association of renters: Hawaii County's zoning code does not distinguish between long-term rentals and short-term vacation units, also known as transient vacation rentals.

"The other counties do," Yuen said. "They define vacation rental periods as less than 'X' number of days."

. . . .

But Yuen, who said any kind of new ordinance regarding vacation rentals is not on his to-do list, said there are also benefits to the transient vacation unit business. "The upside is it allows a wider range of people to make money off the visitor economy," Yuen said. "There are a lot of other issues one can take on, and this one isn't one of them."

This reminds me of a common "big box store" dynamic on the mainland.  When one town or city bars such stores, they often just relocate to a neighboring jurisdiction which welcomes them  (along with their sales and property taxes) with open arms.  That dynamic doesn't really work in Hawaii with retail outlets, since it doesn't make a lot of sense to go to another island to shop, but as the article suggests, maybe it works on vacation rentals, since the visitor chooses between destinations before the trip.

▪ Government Response in Maui Vacation Rental Lawsuit

The Maui News reports that the County of Maui has filed a "response" (motion to dismiss) to the federal complaint brought by the Maui Vacation Rental Association against the County.  I posted about the case here.  The complaint summarizes the claims:

This is an action for injunctive and declaratory relief against defendants, and each of them, for their conduct in dealing with the owners of property being used as Transient Vacation Rentals in the County of Maui. Plaintiff alleges procedural and substantive due process and equal protection violations, equitable estoppel, breach of express and implied contract. Plaintiff also alleges municipal liability for failure to adequately train and supervise entity employees, and for the maintenance of illegal customs and policies, both of which cause and allow constitutional violations of procedural due process, substantive due process, equal protection, and deprivation of honest government services, in violation of the Fourth, Fifth and Fourteenth Amendments to the U.S. Constitution.

Download the Complaint (800kb pdf) here.  Shortly after the complaint was filed, the plaintiff moved for a preliminary injunction (200kb pdf). 

The County has now responded by filing a motion to dismiss (4mb pdf).  The motion asserts, among other claims, that the MVRA has no standing to sue, that the complaint does not properly allege a claim for substantive due process, that MVRA has no claim for vested rights or estoppel, and that there is no contract between the County and MVRA requiring the County to deal with MVRA fairly and in good faith.  The County also interposes several legal defenses including statute of limitations and qualified immunity.

▪ Maui TV News: Maui Vacation Rental Lawsuit

A report from Maui TV News on the federal lawsuit by the Maui Vacation Rental Association against the County of Maui. 

More about the case, including links to the complaint, here.