Disruption of Power Supply Not Enough to Prove Constructive Eviction

May 25, 2023

What Happened: Operating a Bitcoin mining business requires unusually high amounts of electricity. Miffed at learning this lesson the hard way, an office building landlord threatened a Bitcoin tenant with eviction. When the electric company later shut down the tenant’s power after transferring its account to the landlord’s name, the tenants suspected foul play and sued the landlord for constructive eviction and a temporary restraining order (TRO) requiring it to restore the power.

What Happened: Operating a Bitcoin mining business requires unusually high amounts of electricity. Miffed at learning this lesson the hard way, an office building landlord threatened a Bitcoin tenant with eviction. When the electric company later shut down the tenant’s power after transferring its account to the landlord’s name, the tenants suspected foul play and sued the landlord for constructive eviction and a temporary restraining order (TRO) requiring it to restore the power.

Ruling: The Michigan federal court refused to grant the tenants a TRO.

Reasoning: The tenant was dependent on maintaining an uninterrupted flow of electrical power, the court acknowledged. But even if the tenant could prove that it was the landlord that caused the disruption in electrical service, the tenant still wouldn’t have a legally valid claim for constructive eviction because it never actually vacated the premises. Simply disrupting its Bitcoin operation wasn’t enough. As in other states, in Michigan “an aggrieved party must vacate the premises within a reasonable amount of time” to prove constructive eviction, the court reasoned.

  • Cheetah Miner USA Inc. v. 19200 Glendale, LLC, 2023 U.S. Dist. LEXIS 77173, 2023 WL 3223856

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