Residents and businesses in San Francisco’s Tenderloin neighborhood can proceed with most of their lawsuit against the City and County of San Francisco, a federal judge has ruled.

The plaintiffs allege that the city’s policies have turned their neighborhood into a “containment zone” for illegal drug activities, resulting in crime and unsanitary conditions that violate their rights.

In an order issued on Oct. 15, Judge Jon S. Tigar of the U.S. District Court of the Northern District of California granted in part and denied in part the city’s motion to dismiss the case.

While dismissing the plaintiffs’ federal due process claim under the “state-created danger” doctrine, Tigar allowed their state law claims—including public and private nuisance and violations of California’s Disabled Persons Act—to move forward.

The lawsuit, filed in March, contends that for years, the city has allowed open-air drug dealing and drug use in the Tenderloin—activities the plaintiffs say are not tolerated in other neighborhoods.

The plaintiffs—five anonymous residents and two local hotels—argue that the city’s actions and inaction have led to rampant crime, blocked sidewalks, and deteriorating living conditions.

“Plaintiffs are residents of and stakeholders in the Tenderloin,” the complaint states. “They face an existential crisis caused by the City’s treatment of their neighborhood as a ‘containment zone’ for narcotic activities.”

A central allegation is that the city has actively contributed to the drug crisis. The plaintiffs claim that the city distributes fentanyl smoking kits to individuals living on the sidewalks, and operates programs that provide services to addicts who refuse shelter and camp on the streets.

One focus is the Tenderloin Center, opened by the city in January 2022. The plaintiffs allege that the center encouraged addicts to consume narcotics, exacerbating the neighborhood’s problems. Although the center closed in December 2022, they argue that it continues to attract drug dealers and users.

In its motion to dismiss, the city said it and the county spend “hundreds of millions of dollars each year addressing homelessness, substance abuse, and crime.”

The defendants say they provide “offers of shelter and other direct services to persons experiencing homelessness, [and] harm reduction and related services to people dealing with substance abuse.”

The city said it brings in local, state, and federal law enforcement to help address crime.

“Like cities across the nation, the City faces challenging street conditions due to the fentanyl and drug crisis and that problem unfortunately is particularly acute in parts of the Tenderloin. Still, despite its commitment of resources and attention, the City acknowledges that more work needs to done and intends to continue to use its best efforts to improve the conditions in the Tenderloin,” the city stated.

In its motion, the city argued that it is immune from liability and that the plaintiffs lacked standing to bring the action. The judge disagreed, finding the plaintiffs had sufficiently alleged that the city’s affirmative actions could have plausibly contributed to their harm.

“Plaintiffs’ amended complaint ... now alleges affirmative conduct on the part of the City,” Tigar wrote. “Thus, if and when the court considers remedies, the appropriate relief may be as simple as ordering the City to cease engaging in certain activities.”

Tigar noted the inclusion of the affirmative conduct resolved issues that had prompted him to dismiss the claims in July when the residents claimed only that the city’s inaction led to the Tenderloin’s current conditions.

The judge also rejected the city’s claim of immunity under the California Emergency Services Act, noting it wasn’t clear the alleged actions were related to any declared emergency.

Tigar said the plaintiffs had valid claims for public and private nuisance under California law. They alleged specific injuries related to their property—such as blocked entrances and sidewalks, threats of violence, and exposure to hazardous conditions—that could be linked to the city’s actions.

Tigar also allowed claims under the California Disabled Persons Act to proceed. Two plaintiffs, “Mary Roe” and “Susan Roe,” allege they are disabled and that encampments and crowds obstruct sidewalks, forcing them to navigate dangerous conditions. “This is sufficient to allege standing,” the judge wrote.

The lawsuit included accounts from residents, including “Jane Roe,” who lives with her family on Ellis Street. She alleged that drug dealers block her building entrance and that she has received death threats when asking people not to start fires that aggravate asthma in one of her two young daughters.

Businesses also reported negative effects. The Phoenix Hotel, a historic establishment, alleges a drastic decline in business due to unsafe conditions such as open drug use and blocked sidewalks. Guests have reported feeling unsafe and being harassed by loiterers, the suit says.

The plaintiffs argue that the city’s unofficial policy effectively herds addicts and dealers into the Tenderloin by not enforcing laws there that the city does enforce in other neighborhoods. They contend the city would not tolerate such conditions in more affluent areas such as Pacific Heights.

The judge separately dismissed the federal denial of due process claim, noting that the plaintiffs hadn’t alleged harm severe enough to meet the standard for a “state-created danger.” He granted them leave to amend this portion of the complaint within 21 days.

This ruling allows the plaintiffs to pursue most of their claims, and seek injunctive and equitable relief to compel the city to change its policies in the Tenderloin.

Attorneys representing the City of San Francisco did not respond to a request for comment on the judge’s order.