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In the two and one-half years since the Protecting Tenants at Foreclosure Act took effect, Congress, federal courts, the California Legislature, and local governments have all endeavored to provide additional clarity on the issue with mixed results. In a follow-up to his 2009 Emerging Issues Analysis on the effects of foreclosure on tenant-occupied property, Christopher Martz tracks those attempts and discusses the latest developments in the field. He writes:
II. Congress Extends the Protecting Tenants at Foreclosure Act and Defines a Critical Term
The PTFA remains unchanged for the most part since its original passage with two notable exceptions:
III. Federal Courts Rule on Preemption, Subject Matter Jurisdiction, and a Right of Action Under the PTFA
Since the passage of the PTFA, District Courts across California have had the opportunity to pass on the Act's implications and relationship to state and local law. As of early 2012, no published Circuit Court opinions address the Act. Below is a discussion of the three most important District Court holdings.
1. No Preemption
The plain language of the PTFA indicates that it is not meant to preempt state or local law relating to the landlord-tenant relationship following foreclosure.Although no appellate court in California has yet taken up this question, District Courts in all four federal judicial districts in California have confirmed this reading of the Act [Wells Fargo Bank v. Lapeen (N.D. Cal. 2011) U.S. Dist. LEXIS 60671, *10-*12 [enhanced version available to lexis.com subscribers] ("by its plain text, the PTFA is focused on providing additional or supplemental protections to state or local laws") ....
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