11/2/2022 1:47 PM

22CV37548

4 IN THE CIRCUIT COURT FOR THE STATE OF OREGON

5 FOR THE COUNTY OF LANE

6 THORIN PROPERTIES LIMITED
PARTNERSHIP, an Oregon Limited
7 Partnership; and JENNINGS GROUP, INC., an Case No.
Oregon Corporation,
8 COMPLAINT
Plaintiffs, (Declaratory Judgment)
9
v. NOT SUBJECT TO MANDATORY
10 ARBITRATION
CITY OF EUGENE, an Oregon municipal
11 corporation, Statutory Authority: $281 per ORS
21.135(2)(f)
12 Defendant.
13

14 Plaintiffs Thorin Properties Limited Partnership (“Thorin Properties”) and Jennings

15 Group, Inc. (“Jennings Group”) (collectively, “Plaintiffs”) allege as follows:
16 INTRODUCTION
17 1.
18 This action challenges amendments to Sections 8.405, 8.415, 8.425, 8.430, and 8.440 of
19 the Eugene Code by Ordinance No. 20670 (“the Ordinance”) that impose upon residential
20 property landlords a “Maximum Applicant Screening Charge” limited to the amount “allowed by
21 ORS 90.295 or $10.00, whichever is less.” However, ORS 90.925 grants landlords the right to
22 collect applicant screening charges sufficient “to cover the costs of obtaining information about
23 an applicant * * *.” Indeed, the Legislative Assembly considered and rejected a proposal to set a
24 fixed maximum screening charge when it enacted ORS 90.295. By prohibiting landlords from
25 recovering their actual screening costs in excess of $10.00, the Ordinance therefore attempts to
26 strip landlords of the rights granted by the legislature under the Oregon Residential Landlord

Page 1 – COMPLAINT
4855-1913-6571v.5 0080066-000012 DAVIS WRIGHT TREMAINE LLP
1300 S.W. Fifth Avenue, Suite 2400
Portland, Oregon 97201-5610
(503) 241-2300 main  (503) 778-5299 fax
 1 Tenant Act (“ORLTA”), including ORS 90.925. Because the Ordinance is incompatible with the

2 ORLTA, the Ordinance is preempted.

3 2.

4 Plaintiffs seek a declaration that the Ordinance, or portions thereof, is preempted by state

5 law and is therefore invalid. Plaintiffs also seek permanent injunctive relief to prevent

6 enforcement of the Ordinance’s Maximum Applicant Screening Charge.

7 JURISDICTION
8 3.
9 This court has jurisdiction because this action is brought in accordance with ORS 28.010

10 to 28.160, Oregon’s Uniform Declaratory Judgments Act, seeking “to afford relief with respect

11 to rights, status and other legal relations” relevant to Plaintiffs and the Ordinance.

12 VENUE
13 4.

14 Venue is appropriate in Lane County because the Ordinance was adopted by the City of

15 Eugene, the Ordinance is intended to regulate conduct and to be enforced at least in part within

16 Lane County, and the cause of the suit arose in Lane County.

17 PARTIES
18 5.

19 Plaintiff Thorin Properties is an Oregon Limited Partnership. It owns 16 properties in

20 Eugene, Oregon, consisting of 82 apartment units and six stand-alone rental homes. It is a

21 “Landlord” pursuant to the Ordinance and subject to the Maximum Screening Charge.

22 6.

23 Plaintiff Jennings Group, Inc., is an Oregon corporation which is licensed as a property

24 management firm. It manages 1,595 residential department units in the City of Eugene. It is a
25 “Landlord” pursuant to the Ordinance and subject to the maximum Screening Charge.

26

Page 2 – COMPLAINT
4855-1913-6571v.5 0080066-000012 DAVIS WRIGHT TREMAINE LLP
1300 S.W. Fifth Avenue, Suite 2400
Portland, Oregon 97201-5610
(503) 241-2300 main  (503) 778-5299 fax
 1 7.

2 Defendant City of Eugene is an Oregon municipal corporation subject to the limitations

3 on home rule authority contained in Article XI, section 2, of the Oregon Constitution.

4 ALLEGATIONS
5 8.

6 On July 11, 2022, the Eugene City Council adopted Ordinance No. 20670, which was

7 signed by the Mayor of Eugene on July 13, 2022, and became effective August 13, 2022. The

8 Ordinance revised Sections 8.405, 8.415, 8.425, 8.430, and 8.440 of the Eugene Code. A true
9 copy of the Ordinance is attached and incorporated as Exhibit 1.

10 9.

11 The revisions to Eugene Code work in tandem to provide a statutory scheme wherein

12 landlords are stripped of rights afforded them in the ORLTA concerning applicant screening

13 charges, specifically by the addition of subsection (14) to Section 8.425 of the Eugene Code,

14 which reads in its entirety:

15 (14) Maximum Applicant Screening Charge. The amount of any

applicant screening charge may not exceed the amount of an
16 applicant screening charge allowed by ORS 90.295 or $10.00,
whichever is less.
17
10.
18
Plaintiffs own residential property within the City of Eugene, which they rent or lease out
19
under Rental Agreements and leases governed by the ORLTA. Plaintiffs, collectively, have in
20
the past and plan in the future to charge applicant screening charges to prospective tenants. The
21
screening costs incurred by Plaintiffs vastly exceed $10 per applicant and greatly exceed the
22
costs customarily charged by tenant screening companies.
23
11.
24
Plaintiffs are adversely affected by the enactment and enforcement of the amendments
25
contained the Ordinance, which restricts the amount they are allowed to charge tenants in the
26

Page 3 – COMPLAINT
4855-1913-6571v.5 0080066-000012 DAVIS WRIGHT TREMAINE LLP
1300 S.W. Fifth Avenue, Suite 2400
Portland, Oregon 97201-5610
(503) 241-2300 main  (503) 778-5299 fax
 1 screening process and prevents them from recovering their actual screening costs.

2 12.

3 First enacted in 1993, ORS 90.295(1)(a) and (2) provide in their entirety:

4 (1)(a) A landlord may require payment of an applicant screening charge solely to

cover the costs of obtaining information about an applicant as the landlord
5 processes the application for a rental agreement. This activity is known as
screening, and includes but is not limited to checking references and obtaining a
6 consumer credit report or tenant screening report. The landlord must provide the
applicant with a receipt for any applicant screening charge.
7
*****
8
(2) The amount of any applicant screening charge must not be greater than the
9 landlord’s average actual cost of screening applicants. Actual costs may include
the cost of using a tenant screening company or a consumer credit reporting
10 agency, and may include the reasonable value of any time spent by the landlord or
the landlord’s agents in otherwise obtaining information on applicants. In any
11 case, the applicant screening charge must not be greater than the customary
amount charged by tent screening companies or consumer credit reporting
12 agencies for a comparable level of screening.
13 13.

14 As set forth in ORS 90.100(3), the express purpose of the applicant screening charge “is

15 to pay the cost of processing an application for a rental agreement for a residential dwelling

16 unit.”

17 14.
18 Further, the Legislative Assembly considered setting a maximum applicant screening

19 charge in lieu of granting landlords the right to recover their actual average screening costs—but

20 it rejected that approach. The legislature passed HB 2968 (1993) as codified in ORS 90.295

21 without including a maximum fee for an applicant screening charge.

22 15.

23 Accordingly, the Ordinance conflicts with paramount state law by requiring landlords to

24 charge a maximum $10 for applicant screening charges to tenants even if $10 is less than their
25 actual costs incurred and customary charges made by screening companies for conducting a

26 tenant application screening.

Page 4 – COMPLAINT
4855-1913-6571v.5 0080066-000012 DAVIS WRIGHT TREMAINE LLP
1300 S.W. Fifth Avenue, Suite 2400
Portland, Oregon 97201-5610
(503) 241-2300 main  (503) 778-5299 fax
 1 16.

2 The City of Eugene’s setting of an alternative maximum fee less than the actual costs and

3 customary charges associated with screening a tenant applicant is preempted by the ORLTA.

4 CAUSE OF ACTION
5 DECLARATORY JUDGMENT
6 17.

7 Plaintiffs reallege and incorporate the allegations contained in Paragraphs 1-17.

8 18.
9 Pursuant to ORS 28.010 to 28.160, Plaintiffs are persons “whose rights, status or other

10 legal relations are affected by a[n] * * * ordinance,” entitling them to “have determined any

11 question of construction or validity arising under such * * * ordinance * * *.” ORS 28.020.

12 Pursuant to ORS 28.080, “[f]urther relief based on a declaratory judgment may be granted

13 whenever necessary or proper.”

14 19.

15 Plaintiffs are entitled to a declaration that the Ordinance is invalid and unenforceable

16 because the Ordinance is preempted by the ORLTA. Plaintiffs are also entitled to supplemental

17 injunctive relief permanently enjoining Defendant from enforcing Section 8.425(14) of the
18 Eugene Code.

19 PRAYER FOR RELIEF

20 WHEREFORE, Plaintiffs pray for judgment as follows:

21 1. Declaring the amendments, or portions thereof, to Sections 8.405, 8.415, 8.425,

22 8.430, and 8.440 of the Eugene Code by Ordinance No. 20670 to be invalid because they are

23 preempted by the ORLTA.

24 2. Injunctive relief permanently enjoining Defendant from enforcing Section

25 8.425(14) of the Eugene Code.

26

Page 5 – COMPLAINT
4855-1913-6571v.5 0080066-000012 DAVIS WRIGHT TREMAINE LLP
1300 S.W. Fifth Avenue, Suite 2400
Portland, Oregon 97201-5610
(503) 241-2300 main  (503) 778-5299 fax
 1 3. Awarding Plaintiffs their costs and disbursements incurred herein; and

2 4. Granting any other relief that is just and proper.

3 DATED November 2, 2022.

4 DAVIS WRIGHT TREMAINE LLP

5 By: s/ John DiLorenzo, Jr.
John DiLorenzo, Jr., OSB #802040
6 Email: johndilorenzo@dwt.com
Christopher Swift, OSB #154291
7 Email: chrisswift@dwt.com
Seth Tangman, OSB #211456
8 Email: moetangman@dwt.com
Telephone: (503) 241-2300
9 Facsimile: (503) 778-5299
Attorneys for Plaintiffs
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Page 6 – COMPLAINT
4855-1913-6571v.5 0080066-000012 DAVIS WRIGHT TREMAINE LLP
1300 S.W. Fifth Avenue, Suite 2400
Portland, Oregon 97201-5610
(503) 241-2300 main  (503) 778-5299 fax
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