The lawsuit was filed Monday by the Orange County Catholic Worker group, a religious organization, and seven homeless people.
The suit claims a broad range of violations of constitutional protections by the governments of Orange County and the cities of Anaheim, Costa Mesa and Orange.
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The filing came exactly one week after the Orange County Sheriff's Department began a "soft launch" to remove homeless individuals within a 2-mile-long bike trail paralleling the Santa Ana River from Memory Lane in Orange to Taft Avenue and Ball Road near Angel Stadium. An estimated 1,000 people live in the area.
"I think it's going to be hard to make everybody leave because we don't have places to go," said Angela Peifer, who has lived at the homeless encampment for 2.5 years.
The lawsuit alleges the defendants forced homeless people from those jurisdictions into the Santa Ana River Trail encampment, and that the county is now trying to force those people back into surrounding areas without a plan for shelter or housing.
"The failure, if not the outright refusal of Orange County and its cities to adopt positive measures to address the housing crisis and the willingness to criminalize the mere act of existing in public spaces takes a toll on the County's most vulnerable people," the lawsuit said.
It added that "the County and its cities have invested in enforcement instead of housing, blaming other entities for the problem, and leaving unhoused people nowhere to turn, nowhere to live, and nowhere to sleep."
However, during last week's soft launch, OCSD Undersheriff Don Barnes said there would be services and measures in place to help the homeless.
"We will do everything we can through services, outreach to help people get back home, but we're not going to come in with a show of force on day one and just start moving people out. At some point, everybody will have to be off the riverbed," he said.
Barnes added that the Santa Ana River Trail is not an area considered safe for people to live. In previous cleanup efforts, hazardous materials such as 4,600 needles and 315 tons of trash have been discovered.
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The river bed is one of the latest crisis points as cities up and down the West Coast grapple with a surge in homelessness caused in part by soaring housing costs, rock-bottom vacancy rates, drug addiction and need for mental health services.
The lawsuit seeks restraining orders and permanent injunctions against closing the riverbed encampment, citing individuals for trespassing or nuisance, citing or arresting people for violations of municipal camping and loitering ordinances, among other things.
The Associated Press contributed to this report.