Supreme Court Justice Clarence Thomas voted to end federal tenant protections that his billionaire benefactor’s company says threatened its real estate profit margins, according to corporate documents reviewed by The Lever. Thomas did not disclose his relationship with real estate billionaire Harlan Crow, nor did he recuse himself from the 2021 case, despite its potential impact on Crow Holdings.
Now, rent control — which Crow Holdings’ documents also say threatens the company’s business — could come before Thomas, and there is no indication he would recuse himself if it does.
Recent reporting by ProPublica found that Thomas failed to disclose two decades’ worth of luxury gifts provided by Crow, as well as Crow’s purchase of properties owned by Thomas, in apparent violation of longstanding federal ethics rules.
Crow Holdings’ financial disclosures about eviction moratoria and rent control — coupled with revelations that Thomas was accepting lavish, undisclosed gifts from Crow — contradicts the notion that the conservative justice never ruled on matters related to his benefactor’s business.
Crow Holdings did not respond to The Lever’s request for comment.
“May Be Particularly Susceptible”
In August 2021, Thomas was one of the six justices who voted to strike down a federal administrative moratorium on evictions, originally enacted in September 2020 by the Centers for Disease Control and Prevention to halt the spread of COVID-19. In June, Thomas was one of four justices who voted to end the moratorium — but the majority voted to leave it in place because it was set to expire the following month.
In July, between the two rulings, Crow Holdings — which owns apartment buildings, student housing, and manufactured housing nationwide — was cited in congressional testimony for being one of the country’s most frequent eviction filers, despite the moratorium.
In March 2020, Crow Holdings Capital, the firm’s investment arm, warned investors in a financial filing that the pandemic was already leading to “substantial governmental intervention” that could end up “substantially eliminating market participants’ ability to continue to implement certain strategies or manage the risk of their outstanding positions.”
This March, Crow Holdings Capital made its interest in ending eviction moratoria explicit, telling investors that its business “may be particularly susceptible to economic effects driven by a pandemic such as COVID‐19, including risks related to tenants being unable to pay rent (particularly with respect to residential, retail and office properties), federal or state restrictions on rent pricing, rent increases, or eviction moratoriums.”
“A Long-Term Eviction Moratorium Was Never The Right Policy”
At the time of Thomas’ 2021 vote, Ken Valach, the CEO of Crow Holdings’ development arm, was serving as the vice chair of the National Multifamily Housing Council, a lobbying group pressing the federal government to end the moratorium.
“A long-term eviction moratorium was never the right policy,” the group said in a statement. “It does nothing to speed the delivery of real solutions for America’s renters and ignores the unsustainable and unfair economic burden placed on millions of housing providers, jeopardizing their financial stability and threatening the loss of affordable housing stock nationwide.”
That same year, another Crow executive was a member of the Real Estate Roundtable, a nonprofit think tank that also opposed the eviction moratorium.
Bloomberg recently reported that Thomas did not appear to recuse himself in a 2005 Supreme Court case involving Trammell Crow Residential, in which Crow Holdings owned a minority stake.
In the coming months, the rent control issue flagged by Crow Holdings could be before Thomas and the high court.
A group of New York landlords are preparing to petition the Supreme Court to overturn the city’s rent stabilization laws after losing a recent case. Such a ruling could endanger rent-control laws nationwide.
