Newport Beach will pay $5.25 million to settle recovery residence dispute

Three operators of California recovery residences will receive $5.25 million in a settlement of a longstanding legal dispute with the city of Newport Beach over a 2008 municipal ordinance regulating sober homes, it was announced last week. The plaintiffs in the case won a U.S. Court of Appeals ruling in 2013 that stated there was enough evidence to support their claim that the ordinance violated Fair Housing Act provisions that protect the siting of recovery residences for persons with addictions.

The plaintiffs in the case were Pacific Shores Properties, Newport Coast Recovery and Yellowstone Women's First Step House. Their attorney, Steven Polin, told the Orange County Register, “Everybody took into account the calculus—a trial could have taken another two to four years,” on top of the seven years in which the dispute already had played out.

The ruling in the 9th Circuit Court of Appeals overturned a 2011 lower-court ruling that the sober home operators could not sue the city. Earlier this year, city officials stated that there were 25 recovery residences in Newport Beach, including 15 that have state licenses. That overall number represents a significant drop from the figure from eight years ago.

Some have openly wondered whether this settlement outcome, which was not unexpected, truly represents a victory for recovery residence operators in general. In an interview last December, Sober Living Network leader David Sheridan stated that in their fierce effort to uphold a faulty ordinance for many years, Newport Beach city leaders “have made it known that Newport Beach is not hospitable to people in recovery.”

The recovery residence community in California also is in a legal battle with nearby Costa Mesa, which was sued in two actions last fall after adopting its own ordinance regulating sober homes' locations and bed capacity. Costa Mesa's number of residences has increased as Newport Beach's has declined.