Summary
The Ninth Circuit affirmed the denial of Diamond Sands Apartments, LLC’s motion for a preliminary injunction in its challenge to Clark County, Nevada’s short-term-rental ordinance under the Eighth Amendment’s Excessive Fines Clause. The court held that the $4,000 in fines were not grossly disproportionate to the violations and that the facial challenge failed because the ordinance was not shown to be unconstitutional in every conceivable application.
Topics
Practice areas
Questions Presented
- Whether Diamond Sands was entitled to a preliminary injunction against enforcement of Clark County's short-term-rental ordinances based on an as-applied Excessive Fines Clause challenge.
- Whether the $4,000 in fines was grossly disproportionate to the gravity of Diamond Sands' short-term-rental ordinance violations.
- Whether Clark County's ordinances were facially unconstitutional under the Eighth Amendment's Excessive Fines Clause.
Holdings
- The district court did not abuse its discretion in denying Diamond Sands' motion for a preliminary injunction because Diamond Sands failed to show a likelihood of success or serious questions going to the merits of its constitutional claims.
- The fines were not grossly disproportionate to the gravity of the violations. Diamond Sands' knowledge of and failure to eliminate the unauthorized rentals supplied some culpability; the ordinance authorized alternative penalties and the fines were at the low end of the authorized range; and the County's legislative findings and resident complaints supplied a rational basis connecting the fines to harms caused by unauthorized short-term rentals.
- Diamond Sands' facial challenge failed because it did not demonstrate that the ordinance was unconstitutional in every conceivable application.
Key quotations
“Instead, our guiding question is whether the fine is “grossly disproportional to the gravity of the [] offense[.]”” (7)
“Rather than showing that the ordinance could potentially be enforced unconstitutionally in one hypothetical application, Diamond Sands must demonstrate that it is “unconstitutional in every conceivable application.”” (13)
Factual background
Diamond Sands owns and operates a 360-unit apartment complex in Las Vegas whose leases prohibited unauthorized subletting. After receiving complaints about loud parties and short-term rentals, Clark County investigated several units and confirmed that they had been rented through Airbnb. The County issued notices of abatement and, after follow-up inspections confirmed continuing violations, imposed two $2,000 administrative fines, totaling $4,000; Diamond Sands paid one and disputed the other.
Procedural history
Clark County imposed two administrative fines of $2,000 each on Diamond Sands for violations of ordinances governing unauthorized short-term rentals. Diamond Sands filed facial and as-applied constitutional challenges in the United States District Court for the District of Nevada and sought a preliminary injunction. The district court denied the motion, concluding that Diamond Sands had not shown a likelihood of success on the merits because the fines were not grossly disproportionate to the violations. The Ninth Circuit affirmed.