A group of landlords arguing that a pandemic-era eviction moratorium cost them millions of dollars is locked in settlement negotiations with the Department of Justice after winning an appeal that allowed its federal lawsuit to go forward.
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The more than 1,500 property owners suing the government argue that the nearly yearlong federal eviction moratorium violated their constitutional rights. The government first won the case in 2020, but the plaintiffs won an appeal in June 2025 that has pushed the two sides to the negotiating table.
The landlords are looking to collect as much as $1.5B from the government, the Associated Press reported. The group says that amounts to a fraction of what was lost, with the landlords saying in court filings that they each notched losses ranging from thousands of dollars up to one that says it lost $14.5M.
Most of the property owners in the case, Darby Development Co. v. United States, own less than 1,000 units, but several have sizable portfolios.
The largest named landlord is California-based Investors Management Trust Real Estate Group, which has 15,015 units across the country, according to the complaint.
At least 17 entities associated with Tampa-based multifamily operator Prosperity Capital Partners are part of the suit, including 3540 North Camp Creek Pkwy PCPRE LLC, which shares its address with a Prosperity-owned complex in Atlanta.
Commerce Capital Group owns 6,162 units, mostly in its home state of Texas, and Gateway Management Co. owns 5,356 apartments across Alabama, Georgia and Mississippi.
The landlords argue that the eviction moratorium infringed on their Fifth Amendment rights by unlawfully denying them compensation.
The federal eviction moratorium was put in place by President Donald Trump’s first administration and lasted from September 2020 through July 2021, by which point, Joe Biden was in the White House. Longer bans were imposed by 43 states and dozens of cities, according to the AP.
Eviction bans were controversial even in the depths of the pandemic, as lockdowns and lost jobs ate away at the ability of millions of tenants to pay rent. Landlords say the moratorium wrecked their business model, forcing them to cut staff, take on debt, delay repairs or sell property. Advocates say it staved off a wave of homelessness and helped prevent the spread of the coronavirus.
The more than 1,500 landlords taking the federal government to court represent a fraction of property owners impacted by the moratorium, and it’s unclear whether a settlement would open the door for thousands of other landlords in the same way that a legal decision might.
Attorneys at Duane Morris wrote in a June blog post that allowing Darby to proceed “opens up the potential for billions of dollars of takings claims against the federal government.”
If a settlement is reached, federal officials will be stuck handling more than a thousand claims from landlords that missed out on rent — and the threat of thousands more — at the same time that they wade through refund requests for Trump’s tariff regime that could total as much as $175B.
The online portal spun up by U.S. Customs and Border Protection to process refunds after the Supreme Court ruled much of Trump’s tariff regime unconstitutional was brought down at launch by a flood of claims.
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