Thursday, May 25, 2023
The Supreme Court ruled today that a county violates the Takings Clause when it seizes and sells property for taxes due, but retains the surplus value above the outstanding tax bill. The ruling means that Hennepin County, Minnesota, owes property owner Geraldine Tyler the $25,000 surplus that it retained after satisfying her overdue tax bill.
The case, Tyler v. Hennepin County, arose when the County seized and sold Tyler's property after she failed to pay $15,000 in taxes. The County sold the property for $40,000 and kept the extra $25,000. Tyler sued, arguing that the County violated the Takings Clause.
A unanimous Court agreed. Chief Justice Roberts wrote that history and precedent both say that the government can't take more than it's owed, and that a taxpayer is entitled to the surplus.
Justice Gorsuch wrote a concurrence, joined by Justice Jackson, arguing that the lower courts also erred in dismissing Tyler's Eighth Amendment Excessive Fines Clause claim.
Friday, May 12, 2023
The Sixth Circuit ruled that Nashville's requirement that landowners who seek building permits grant an easement and construct a sidewalk is subject to the unconstitutional conditions test, and not the regulatory takings test, under the Takings Clause.
The ruling, along with a key concession by Nashville, means that Nashville's sidewalk ordinance constitutes a taking, and that Nashville must provide just compensation (to be determined on remand). (That doesn't mean that every sidewalk ordinance, or the like, necessarily constitutes a taking, however, even under the unconstitutional conditions test. That's because Nashville didn't argue this point. More on that below.)
The ruling weighs in on a hot issue in the state courts around similar conditioned permit requirements: whether those requirements are subject to the (more rigorous) unconstitutional conditions test, or the (less rigorous) ordinary regulatory takings test. The Sixth Circuit ruled that Nashville's sidewalk ordinance is subject to the unconstitutional conditions test.
The case, Knight v. Metropolitan Government of Nashville, arose when, in order to create more sidewalks, Nashville required property owners who seek a building permit to grant an easement on their property and construct a sidewalk (or pay an "in-lieu" fee that the city would use to build sidewalks elsewhere). Property owners sued, arguing that the requirement constituted an uncompensated taking. In particular, they said that the sidewalk requirement constituted an unconstitutional condition on a building permit.
In order to assess this kind of case and determine whether a condition constitutes a taking, courts use a three-part approach. First, they ask if the condition would qualify as a taking if the government required it directly. If not, there's no taking. But if so, next, the government must demonstrate a "nexus" between the condition and the development. (The condition must be related in kind to the development.) Finally, the government must establish a "rough proportionality" between the condition and the development, so that the condition's burdens on the property owner approximate the development's burdens on the community. (The condition must be related in magnitude to development's costs to the community.) This three-part test comes from Nollan v. California Coastal Commission, Dolan v. City of Tigard, and Koontz v. St. Johns River Water Management District. If the government fails to show a "nexus" or "rough proportionality," the condition is a taking (assuming it's for public use), and the government must pay just compensation.
Nashville countered that the sidewalk requirement was an ordinary regulation, subject to the Court's regulatory takings test. Nashville claimed that because the sidewalk ordinance was "legislative" (that is, imposed on all property owners by the city council), and not "adjudicative" (imposed by zoning officials on individual property owners on a case-by-case basis), the ordinance looked more like an ordinary regulation, and not like an exaction in exchange for a benefit.
In order to assess this kind of case and determine whether a regulation constitutes a taking, courts look to the nature of the regulatory scheme and its effects on the property owner, among other considerations, and, using a kind of totality-of-the-circumstances approach, determine whether the regulatory scheme goes too far. Penn Central Transportation Co. v. New York City. If so, the regulatory scheme is a taking, and the government must pay just compensation.
The court sided with the property owners. It said that nothing in the Taking Clause's history or case-law supported Nashville's claimed distinction between a "legislative" condition and an "adjudicative" one, and that Nashville's sidewalk ordinance looked more like a typical exaction in exchange for a government benefit.
The court then noted that Nashville didn't even bother to argue that the sidewalk ordinance satisfied the "nexus" and "rough proportionality" test. As a result, the court assumed that the ordinance constituted a taking and remanded the case for a determination of an appropriate remedy.
But note that the court's ruling turned on Nashville's concession. This doesn't mean that every sidewalk ordinance (or the like) constitutes a taking, even under the Nollan/Dolan test. The court itself wrote that the "answer is not obvious," noting that dicta in Dolan said "that 'dedications' for 'sidewalks' are often 'reasonable' conditions on permits."
Monday, December 12, 2022
The Ninth Circuit ruled last week that a federal district court was right to abstain from proceeding on the plaintiffs' regulatory takings claim when a state court was considering an eminent domain action on the property.
The court in Gearing v. City of Half Moon Bay rejected the plaintiffs' claim that federal court Pullman abstention amounted to a state-forum exhaustion requirement, rejected by the Supreme Court.
In English: The Supreme Court ruled in Knick v. Township of Scott and Pakdel v. City and County of San Francisco that a plaintiff need not exhaust state-forum proceedings before lodging a Takings Clause challenge in federal court. This means that a plaintiff can bring a case in federal court to challenge a taking, even as any state-forum proceeding is still pending.
At the same time, on a different front, federal courts can abstain from ruling on a constitutional question when there's a pending state-court challenge, if the case touches on a sensitive area of social policy, the state proceeding could narrow or eliminate the federal constitutional question, and state law is uncertain. That's Pullman abstention.
In this case, the plaintiffs filed a claim in federal court arguing that the City's rejection of the plaintiffs' development plan amounted to a regulatory taking. The City then filed an eminent domain action in state court. The City also filed a motion to abstain in the federal case. The district court granted the motion.
On appeal, the plaintiffs argued that abstention would force them to litigate their federal takings claim in state court, which would functionally require them to exhaust state-forum proceedings in violation of Knick and Pakdel.
The Ninth Circuit disagreed. The court said that those cases addressed exhaustion, not abstention. The court said that even if they preclude abstention in some other case, they don't preclude abstention in this case. That's because the state court could adjudicate the eminent domain action without reaching the plaintiffs' regulatory takings claim--because eminent domain and regulatory takings suits lead to different compensation for different injuries. Finally, the court ruled that the requirements of Pullman abstention were satisfied in this case.
Monday, November 14, 2022
Over the past several years state legislatures confronting a severe housing shortage have increasingly preempted local land use regulations that restrict housing supply in an effort to facilitate more housing production. But even where state legislatures have been successful, they now confront another problem: many of the preempted land use regulations are duplicated at the neighborhood or block level through private “covenants, conditions and restrictions” (CCRs) enforced by homeowners associations. In response, California’s legislature has begun aggressively invalidating or “overriding” these CCRs. While many states have barred HOAs from prohibiting pets, clotheslines, signs and flags, California has moved much farther, prohibiting HOAs from unreasonably limiting accessory dwelling units and overriding any private CCR that would inhibit the construction of 100% affordable housing of any density.
These overrides present serious legal questions because CCRs are property and contract rights that may be protected by the Constitution’s Takings and Contract clauses. Overrides have not resulted in much published litigation in the past, but California’s new wave of aggressive CCR overrides may change that. While the Contract Clause argument is exceptionally weak, homeowners who are disabled from enforcing a servitude benefitting their property due to a legislative override have a viable argument that the override interferes with their reasonable expectations regarding the use of their property, and therefore constitutes an unconstitutional taking. On balance, however, I argue that most CCR overrides will survive a takings challenge because the enforceability of CCRs has long been subject to alteration or even termination by courts or legislatures on public policy grounds, so a homeowner would reasonably expect a CCR to be unenforceable if it conflicts with public policy as determined by the legislature. Nevertheless, the current Supreme Court has been very aggressive in recent takings cases so legislatures will have to be careful in crafting overrides to ensure they satisfy the Court’s increasingly stringent takings standards.
Thursday, November 10, 2022
The Fifth Circuit rejected claims by a tanning business that COVID shutdowns violated its equal protection rights and amounted to an uncompensated taking.
The case, Golden Glow Tanning Salon v. City of Columbus, Mississippi, arose when Columbus ordered a seven-week shutdown of certain businesses in the early days of the COVID pandemic. Golden Glow sued, arguing that the shutdown violated equal protection and constituted an uncompensated taking.
The Fifth Circuit rejected both claims. The court applied rational basis review to Golden Glow's equal protection claim, and concluded that Columbus's action was reasonable, even if a little both over- and underinclusive. As to takings, the court rejected Golden Glow's claim that the shutdown effected a per se taking, because Golden Glow failed to demonstrate that the shutdown "rendered the entire property 'valueless.'"
Judge Ho concurred, and pitched a case for the right to earn a living as a fundamental right. Judge Ho argued that the right "to pursue callings" has even better historical foundations than other unenumerated fundamental rights.
Friday, June 21, 2019
In its opinion in Knick v. Township of Scott, Pennsylvania, a closely divided United States Supreme Court held that a person alleging that their property has been taken by state or local governments may sue in federal court without seeking compensation from state courts, overruling Williamson County Regional Planning Comm'n v. Hamilton Bank of Johnson City (1985).
The case was reargued in February 2019 after Justice Kavanaugh joined the Court and his vote made a difference: the majority opinion by Chief Justice Roberts is joined by Justices Thomas, Alito, Gorsuch, and Kavanaugh. Justice Kagan wrote the dissenting opinion, joined by Justices Ginsburg, Breyer, and Sotomayor.
The facts involve a regulatory taking challenge by the owner of land in rural Pennsylvania which includes a "family cemetery" in the Township of Scott, which had passed an ordinance requiring cemeteries be kept open to the public in daylight hours. The land owner Rose Mary Knick challenged the ordinance as a taking in state court seeking only declarative and injunctive relief, but not "just compensation." She thereafter went to federal court, which dismissed her action under the doctrine of Williamson County, which required seeking "inverse condemnation" (and thus "just compensation") in state court, and the Third Circuit affirmed.
Writing for the five Justice majority, Chief Justice Roberts holds that the Fifth Amendment's Taking Clause is violated when the taking occurs and the property owner must be able to bring an action in federal court at that time. The effective establishment of an "exhaustion requirement" in Williamson County relegates the Takings Clause to a "poor relation" among the Bill of Rights protections, which the majority finds must be remedied by eliminating the requirement to go to state court and therefore "restoring takings claims to the full-fledged constitutional status the Framers envisioned when they included the Clause among other protections in the Bill of Rights." Chief Justice Roberts's majority opinion explains the bad precedent of Williamson County as resulting from the particular procedural facts under which the "Court may not have adequately tested the logic" of the state-litigation requirement and did not anticipate the "preclusion trap" which later resulted (in which the state court findings would be given preclusive effect by the federal court). The Court's opinion concludes that Williamson County should be overruled despite stare decisis given these "shaky foundations," adding that the state-litigation requirement has been subject to criticism and has "proved to be unworkable in practice."
Writing the dissenting opinion for four Justices, Justice Kagan argues that it is not simply Williamson County that is being overruled, but rejects longstanding understandings of the Takings Clause. For the dissenters, the text of the Takings Clause is vital: the Clause states that private property shall not be taken for public use without just compensation. Thus, unlike other constitutional rights which the majority also discusses, Kagan argues that a Takings Clause violation has two necessary elements: "First, the government must take the property. Second, it must deny the property owner just compensation." The failure of the majority to recognize the distinctive aspects of the Takings Clause is is the basis of two of Kagan's four critiques of the Court's opinion. The third critique is based on the Court's reinterpretation of precedent, including under the Williamson County rule, which Justice Kagan states is "with a theory so, well, inventive that it appears in neither the petitioner’s nor her 15-plus amici’s briefs." This is an interesting nod to the amicus briefs filed on behalf of Knick which include briefs from Washington Legal Foundation and Congressman Steve King. Lastly, under the federal Tucker Act, involving claims against the federal government seeking just compensation for a taking.
Perhaps most importantly, Justice Kagan's dissent argues that the consequence of the majority's decision will be to "channel a mass of quintessentially local cases involving complex state-law issues into federal courts." Kagan's opinion highlights the regulatory takings problems (as opposed to the less complex actual taking of property):
This case highlights the difficulty. The ultimate constitutional question here is: Did Scott Township’s cemetery ordinance “go[ ] too far” (in Justice Holmes’s phrase), so as to effect a taking of Rose Mary Knick’s property? Pennsylvania Coal Co. v. Mahon, 260 U. S. 393, 415 (1922). But to answer that question, it is first necessary to address an issue about background state law. In the Township’s view, the ordinance did little more than codify Pennsylvania common law, which (the Township says) has long required property owners to make land containing human remains open to the public. See Brief for Respondents 48; Brief for Cemetery Law Scholars as Amici Curiae 6–26. If the Township is right on that state-law question, Knick’s constitutional claim will fail: The ordinance, on that ac- count, didn’t go far at all. But Knick contends that no common law rule of that kind exists in Pennsylvania. See Reply Brief 22. And if she is right, her takings claim may yet have legs. But is she? Or is the Township? I confess: I don’t know. Nor, I would venture, do my colleagues on the federal bench. But under today’s decision, it will be the Federal District Court for the Middle District of Pennsylvania that will have to resolve this question of local cemetery law.
Justice Kagan also points out that this is the second time in a month that a five member majority [and indeed, the same five member majority] of the Court has overruled "longstanding precedent," quoting from Justice Breyer's dissent in Franchise Tax Bd. of California v. Hyatt. She writes that "the entire idea of stare decisis is that judges do not get to reverse a decision simply because they never liked it in the first place."
Monday, February 25, 2019
Judge Dabney L. Friedrich (D.D.C.) denied the plaintiffs' motion for a preliminary injunction in their challenge to ATF's new rule banning bump-stocks. The ruling in Guedes v. Bureau of Alcohol, Tobacco, Firearms, and Explosives means that the ban can go into effect as the case moves forward; it also telegraphs that the plaintiffs don't have a strong legal case, or really any legal case, against the rule.
We posted on the complaint here, with some background. (The ATF rule defines a standard bump stock as a "machinegun" under the National Firearms Act. Under the rule, effective March 26, 2019, current possessors of bump stocks must either destroy them or abandon them at an ATF office.)
Judge Friedrich ruled that the plaintiffs were unlikely to succeed on the merits of their claims. In particular, the court held that the NFA contained ambiguous terms (key parts of the definition of "machinegun," "single function of the trigger" and "automatically," are not separately defined), and under Chevron the ATF could define "machinegun" for itself. Moreover, the court said that the ATF didn't violate any procedure under the Administrative Procedure Act in adopting the reg. The court held that the plaintiffs' Takings Clause challenge should await future government compensation, instead of a preliminary injunction. And the court rejected the plaintiffs' statutory and constitutional challenges to Acting AG Whitaker's appointment:
The plain text and structure of [the AG Act and the Federal Vacancies Reform Act], however, demonstrate that they were intended to coexist: the AG Act provides a line of succession, and the FVRA gives the President discretion to depart from that line, subject to certain limitations met here.
As a constitutional matter, the plaintiffs argue that the Appointments Clause generally requires an acting principal officer to be either the principal officer's first assistant or appointed by the President with the advice and consent of the Senate. But that theory is foreclosed by Supreme Court precedent and historical practice, both of which have long approved temporary service by non-Senate confirmed officials, irrespective of their status as first assistants.
Separately, the plaintiffs argue that the Appointments Clause at a minimum requires the role of an acting principal officer to be filled by an inferior officer and not a mere employee. . . . Whitaker's designation under the FVRA was a Presidential appointment. And if the temporary nature of Whitaker's service prevented him from becoming an officer, then the President was not constitutionally obligated to appoint him at all.
Monday, September 26, 2016
The United States Supreme Court hears only small fraction of cases: The Court hears about 80 cases a year, of the approximately 8,000 requests for review filed with the Court each year, flowing from the approximately 60, 000 circuit court of appeals decisions and many more thousands of state appellate court opinions. And of this small fraction, generally about half involve constitutional issues, including constitutional criminal procedure issues.
Not surprisingly then, with the new Term starting October 3, the traditional first Monday in October, there are only a handful of constitutional law cases included among the less than 30 the Court has already accepted.
The Court is set to hear two racial gerrymandering cases, both of which involve the tensions between the Voting Rights Act and the Equal Protection Clause with underlying political contentions that Republican state legislators acted to reduce the strength of Black voters; both are appeals from divided opinions from three-judge courts. In Bethune-Hill v. Virginia State Board of Elections, the challenge is to the three-judge court’s decision and order holding that a number of Virginia House of Delegates districts did not constitute unlawful racial gerrymanders in violation of the Equal Protection Clause of the Fourteenth Amendment to the United States Constitution. Virginia concededly did consider race in the redistricting, but the more precise issue is an interpretation under current doctrine regarding whether race was the predominant (and thus unconstitutional) consideration. The three-judge lower court is faulted for requiring an “actual” conflict between the traditional redistricting criteria and race. The petitioners argue that “where a legislature intentionally assigns voters to districts according to a fixed, nonnegotiable racial threshold, “strict scrutiny cannot be avoided simply by demonstrating that the shape and location of the districts can rationally be explained by reference to some districting principle other than race.” If it were other-wise, they argue, even the most egregious race-based districting schemes would escape constitutional scrutiny. In McCrory v. Harris, a racial gerrymandering case involving North Carolina, the challenge is to a three-judge court’s decision finding a constitutional Equal Protection Clause violation. The plaintiff originally argued that the congressional map drawn by the NC Assembly in 2011 violated the Equal Protection Clause in two districts by making race a predominant factor and by not narrowly tailoring the districts to any compelling interest. North Carolina argues that the conclusion of racial predominance is incorrect and that it need not show that racial considerations were “actually necessary” as opposed to “having good reasons” under the Voting Rights Act. The North Carolina districts have been long controversial; a good timeline is here.
In another Equal Protection Clause case, the classification is sex rather than race. In Lynch v. Morales-Santana, the underlying problem is differential requirements regarding US presence for unwed fathers and unwed mothers to transmit citizenship to their child; the Second Circuit held that the sex discrimination was unconstitutional, subjecting it to intermediate scrutiny under equal protection as included in the Fifth Amendment. The United States argues that because the context is citizenship, only rational basis scrutiny is appropriate. This issue has been before the Court before. The last time was 2011 in Flores-Villar v. United States when the Court's per curiam affirmance by an "equally divided Court" upheld the Ninth Circuit’s finding that the differential residency requirement satisfied equal protection. In Flores-Villar, Kagan was recused. The Court hearing Morales-Santana, scheduled for oral argument November 9, will also seemingly be only eight Justices, but this time including Kagan.
Trinity Lutheran Church of Columbia, Mo. v. Pauley also includes an Equal Protection issue, but the major tension is between the Free Exercise of Religion Clause of the First Amendment and principles of anti-Establishment of Religion. Like several other states, Missouri has a so-called Blaine Amendment in its state constitution which prohibits any state monies being used in aid of any religious entity. It is concededly more expansive/restrictive than the US Constitution’s Establishment Clause in the First Amendment as the United States Supreme Court has interpreted it. Missouri had a program for state funds to be awarded to resurface playgrounds with used tires; the state denied the Trinity Lutheran Church preschool’s application based on the state constitutional provision. Trinity Lutheran argues that the Blaine Amendment violates both the Free Exercise Clause and the Equal Protection Clause, with the Eighth Circuit siding with the state of Missouri.
There are also several cases involving the criminal procedure protections in the Constitution. Pena-Rodriguez v. Colorado involves a claim of racial bias on a jury in a criminal case. The Colorado Supreme Court resolved the tension between the “secrecy of jury deliberations” and the Sixth Amendment right to an impartial jury in favor of the former interest. The court found that the state evidence rule, 606(B) (similar to the federal rule), prohibiting juror testimony with some exceptions was not unconstitutional applied to exclude evidence of racial bias on the part of a juror. Bravo-Fernandez v. United States involves the protection against “double jeopardy” and the effect of a vacated (unconstitutional) conviction. It will be argued in the first week of October. Moore v. Texas is based on the Eighth Amendment’s prohibition of cruel and unusual punishment, with specific attention to capital punishment and the execution of the mentally disabled. In short: what are the proper standards for states to make a determination of mental disability?
Finally - - - at least for now - - - the Court will also be hearing a constitutional property dispute. Murr v. Wisconsin involves the Fifth Amendment’s “Taking Clause,” providing that private property cannot be “taken” for public use without just compensation. At issue in Murr is regulatory taking. The Court granted certiorari to a Wisconsin appellate court decision regarding two parcels of land that the Murrs owned since 1995; one lot had previously been owned by their parents. Under state and local law, the two lots merged. The Murrs sought a variance to sell off one of the lots as a buildable lot, which was denied. The Murrs now claim that the denial of the variance is an unconstitutional regulatory taking. The Wisconsin courts viewed the two lots as the “property” and concluded that there was no regulatory taking.
We will be updating this post as the Court adds more cases to its docket.
UPDATE September 29, 2016: The Court granted certiorari to two important First Amendment cases.
September 26, 2016 in Cases and Case Materials, Courts and Judging, Criminal Procedure, Current Affairs, Elections and Voting, Equal Protection, Federalism, First Amendment, Fourteenth Amendment, Race, Religion, Sixth Amendment, Takings Clause | Permalink | Comments (0)
Wednesday, April 22, 2015
The issue of a federal regulatory scheme of raisins returned to the United States Supreme Court for another round of oral arguments today in Horne v. Department of Agriculture.
Recall that in a brief opinion in June 2013, the Court reversed the Ninth Circuit and held that the Hornes did state a claim for regulatory taking. The claim arises from a regulatory program under the authority of the Agricultural Marketing Agreement Act (AMAA) of 1937, as amended, 7 U.S.C. § 601 et seq., that mandates that a certain percentage of a raisins be put in "reserve" each year. By resisting the program, the Hornes have become "outlaws" or heroes of sorts.
While the Hornes continue to argue that the program constitutes a taking, in today's oral argument Michael McConnell representing the Hornes pressed the issue of the taking as a per se one rather than a regulatory one because the Department of Agriculture takes possession and title of the raisins.
The Deputy Solicitor General, Edwin Kneedler, rejected the Chief Justice's humorous suggestion that government would "come up with the truck and you get the shovels and you take their raisins, probably in the dark of night," by insisting that under the Order, the producer submits the raisins to the handler who divides them into two categories. The reserve raisins are separated for later sale, the proceeds of which are pooled and distributed back to the producers. However, Kneedler did admit that one can assume that the government committee takes title in order to sell the raisins.
There were also questions of even if there was a taking whether any "just compensation" was due. In other words, what if the government taking resulted in no loss - - - or even a benefit - - - to the Hornes?
But the Justices seemed bothered by the program, with Justice Scalia expressing this discomfort most blatantly: "Central planning was thought to work very well in 1937, and Russia tried it for a long time." Perhaps the program - - - and the 8 or 10 or maybe more programs that are similar - - - is simply a relic of another time.
However, as Justice Kagan made clear, whether the program was sensible or ridiculous was not for the Court to decide and, she implied, irrelevant to the taking analysis.
Tuesday, March 4, 2014
In its opinion in Wilkins v. Daniels, a panel of the Sixth Circuit affirmed the district judge and affirmed the constitutionality of the Ohio Dangerous Wild Animals and Restricted Snakes Act, which became effective January 1, 2014. The Act prohibits possession of dangerous wild animals - - - including tigers, lions, bears, alligators, and pythons 12 feet or longer - - - without a permit. The permit requirements include the implantation of a microchip under the animal's skin. The Act includes an exemption for individuals accredited by the Association of Zoos and Aquariums (AZA) or the Zoological Association of America (ZAA).
The exemption in the Act's scheme and the "chipping" requirement give rise to the constitutional challenges.
First, and perhaps most creatively, the challengers argued that the exemption for "individuals accredited by the Association of Zoos and Aquariums (AZA) or the Zoological Association of America (ZAA)" constituted compelled speech prohibited by the First Amendment. This compelled speech argument had two "distinct but interrelated" parts: a compelled association claim because the Act "forces" them to join either the AZA or ZAA and a compelled speech claim because the Act requires them to "subsidize the speech of their purely private political and ideological rivals,” the AZA or ZAA.
The panel briefly and accurately set out the doctrine and classic First Amendment cases, but the court's analysis is digestable to its conclusion that there was no compulsion, by association or subsidy: "There are fifteen ways appellants can comply with the Act: the permitting requirement and fourteen exemptions." As the panel concluded, "[m]ere unwillingness to conform their conduct to the permitting requirements or the other thirteen exemptions does not mean that the Act compels appellants to join the AZA or ZAA."
Second, the challengers argued that microchipping requirement violated the Takings Clause. The panel found the challenge not ripe because there was no pursuit of state compensation. But, on the merits, the panel found that there was not a taking, stressing the physical taking (rather than the regulatory taking) aspect that seemed to be the central argument. The court analogized to other types of "property," accepting the State's argument that if the Act’s microchipping requirement to be ruled a taking, “laws requiring license plates on cars, warning labels on packaging, lighting on boats, handrails in apartment buildings, and ramps leading to restaurants” would be suspect.
The court rejected these constitutional challenges that, while innovative, seemed to have little support in the doctrine. The arguments also had little political appeal - - - the court notes in its opinion that the Ohio Act was prompted by an incident in which "an Ohio man released over fifty exotic animals before committing suicide."
Friday, August 9, 2013
NPR's "All Things Considered" today featured a segment on "The Raisin Outlaw of Kerman, California," none other than Marvin Horne, of Horne v. Department of Agriculture, decided by the Court in June. Recall that the Court, in a unanimous opinion, reversed the Ninth Circuit's ruling that the Hornes did not state a claim for a regulatory taking. At issue are marketing orders promulgated by the USDA (United States Department of Agriculture) under the authority of the Agricultural Marketing Agreement Act (AMAA) of 1937, as amended, 7 U.S.C. § 601 et seq., that mandate that a certain percentage of a raisins be put in "reserve" each year - - - this fluctuates yearly and by controlling raisins on the market is a means of indirectly controlling prices.
As NPR phrases it, "For not agreeing to participate in behavior that in many other industries would be considered collusion, the federal government sued the Hornes for hundreds of thousands of dollars in uncollected raisins and fines." (emphasis in original).
For anyone following takings clause doctrine (or agricultural matters and food law), this is worth a listen.
Tuesday, June 25, 2013
A sharply divided Supreme Court (5-4) today ruled in Koontz v. St. Johns River Water Management District that a government's demand for a monetary exaction from a property owner as a condition of receiving a development permit is subject to the unconstitutional conditions doctrine in Nollan v. California Coastal Comm'n and Dolan v. City of Tigard and the Takings Clause.
The ruling means that a local government cannot require a property owner to pay money in exchange for a building permit unless there is a "nexus" and "rough proportionality" between the government's demand and the effects of the proposed land use. This is an expansion of the Nollan/Dolan doctrine that creates likely heightened judicial scrutiny of local land-use regulations and fees. Although it's not clear exactly how far this expansion extends--and whether these claims, like Koontz's, would ever be successful--the ruling restricts local governments in the way they create conditions for land-use permits and is therefore a likely victory for property owners.
Nollan and Dolan say that when the government demands a property exaction in exchange for a land-use permit, there must be a "nexus" and "rough proportionality" between the exaction and the proposed land use. If there's no "nexus" and "rough proportionality," then the condition is a government taking, and, under the Takings Clause, the government owes just compensation. The cases represent a version of the unconstitutional conditions doctrine, because they're designed to protect against the government exacting unreasonable conditions in exchange for land-use permits, without paying just compensation for those unreasonable exactions, in violation of the Takings Clause. ("Nexus" and "rough proportionality" protect against government coercion of a property owner, by imposing unreasonable government exactions, unrelated to the property development.)
Those cases were relevant here, because Koontz sought to develop his land in Florida, but the District said it wouldn't grant a permit until Koontz (1) deeded to the District a conservation easement on his property or (2) hired contractors to make imrpovements to District-owned wetlands several miles away.
The Court ruled that Nollan/Dolan applied to both conditions. The Court ruled 5-4 that the Nollan/Dolan rule applied to monetary exactions (the second alternative condition), because, the Court said, monetary exactions implicate the central concern of those cases: the risk that the government might use its power in land-use permitting exact an unreasonable sum of money from a property owner that doesn't have anything to do with the proposed development. Justice Alito wrote for the Court, joined by Chief Justice Roberts and Justices Scalia, Kennedy, and Thomas.
The dissent argued that this holding "runs roughshod over Eastern Enterprises v. Apfel" and "threatens to subject a vast array of land-use regulations, applied daily in States and localities throughout the country, to heightened constitutional scrutiny." Justice Kagan wrote the dissent, joined by Justices Ginsburg, Breyer, and Sotomayor.
(The dissent also argued that the case could be disposed of around Nollan/Dolan, because (1) "the District never demanded that Koontz give up anything (including money) as a condition for granting him a permit" and (2) "no actual taking occurred," leaving Koontz just a state-law basis for monetary damages, but the dissenters "cannot see how, and so would spare the Florida courts.")
All nine Justices agreed, however, that the Nollan/Dolan rule applied to the first alternative condition. The question here was whether that rule applied where, as here, the government demands a condition before it approves a permit (rather than denying a permit for failure to meet the condition). All nine said yes. But because the government didn't take anything--it simply declined to grant a permit until a condition was satisfied--the property owner cannot get just compensation (although he might be entitled to monetary relief under state law).
The Court remanded the case to the Florida Supreme Court for a determination whether Koontz is entitled to any monetary relief under state law. If the dissent is right, this is a futile effort.
Monday, June 10, 2013
In a relatively brief opinion in Horne v. Department of Agriculture by Justice Thomas writing for a unanimous Court, the Court reversed the Ninth Circuit's ruling that the Hornes did not state a claim for a regulatory taking.
Recall that the Hornes are involved in the raisin business and the Ninth Circuit had upheld a regulatory scheme that mandates that a certain percentage of a raisins be put in "reserve" each year - - - this fluctuates yearly and by controlling raisins on the market is a means of indirectly controlling prices.
The precise nature of the Hornes' involvement in the raisin business - - - whether they are handlers or producers - - - is important to the controversy. But, the Supreme Court held, not as important as the Ninth Circuit ruled. Instead, the Court held that
The Ninth Circuit confused petitioners’ statutory argument (i.e., “we are producers, not handlers”) with their constitutional argument (i.e., “assuming we are handlers, fining us for refusing to turn over reserve-tonnage raisins violates the Fifth Amendment”).
Thus, the Ninth Circuit should have reached the merits of the Takings Clause claim.
Moreover, the argument that the Hornes' claim was not ripe was also incorrect. They were subject to enforcement proceedings and they are free to raise their Takings Clause defense before the USDA and the courts.
Although a somewhat technical decision sounding in "jurisdiction," the Court has opened the way for a regulatory Takings Clause claim against an agricultural scheme seeking to control prices and supply.
[image of raisin via]
Friday, February 1, 2013
As Grand Central Station celebrates its centennial today, there are many celebrations and discussions, including this excellent one from "Transportation Nation" being aired on some NPR stations, including NYC:
The case to which the report refers is Penn Central Transportation Co. v. New York City (1978), a staple of modern takings clause doctrine and theory. The owner of Grand Central - - - confusingly it was Penn Central - - - wanted relief from the NYC landmarks law which prevented the building of a large office building over Grand Central because it would destroy the historic and aesthetic features of the Grand Central. The United States Supreme Court rejected the takings argument. Writing for the Court, Justice Brennan noted that "the submission that appellants may establish a "taking" simply by showing that they have been denied the ability to exploit a property interest that they heretofore had believed was available for development is quite simply untenable." The opinion continued:
"Taking" jurisprudence does not divide a single parcel into discrete segments and attempt to determine whether rights in a particular segment have been entirely abrogated. In deciding whether a particular governmental action ha effected a taking, this Court focuses rather both on the character of the action and on the nature and extent of the interference with rights in the parcel as a whole.
Of course, the Court would vacillate from between this whole vs. fractional approach in subsequent cases, but the most recent takings cases seem to confirm Brennan's view.
For a trenchant discussion of the current state of "air rights" and takings doctrine, take a look at LawProf Troy Rule's Airspace and the Takings Clause, forthcoming in Washington University Law Review, and available in draft on ssrn.
Tuesday, December 4, 2012
A unanimous Supreme Court (with Justice Kagan recused) ruled today in Arkansas Game & Fish Commission v. U.S. that government temporary flooding may constitute a taking. The ruling is not particularly surprising and only reversed and remanded a lower court decision that read precedent to give temporary floods a pass under the Takings Clause. Justice Ginsburg wrote for the Court that temporary floods get no such pass and may well constitute a taking, depending on a number of well-settled factors.
We covered the oral argument here.
The case arose out of the Army Corps of Engineer's varying water release rates from the Clearwater Dam, upstream from the Commission's Management Area. The release rates caused a series of temporary floods in the Management Area during key tree-growing season, thus harming certain tree species and the wildlife that they supported. The Commission sued, arguing that the floods constituted a taking. The Federal Circuit read Supreme Court precedent to say that temporary floods (as opposed to permanent ones) were categorically exempt from the Takings Clause.
The Supreme Court reversed. Justice Ginsburg wrote that the Federal Circuit misread Court precedent and that even temporary floods could constitute a taking. How do we know when?
When regulation or temporary physical invasion by government interferes with private property, our decisions recognize, time is indeed a factor in determining the existence vel non of a compensable taking. . . .
Also relevant to the takings inquiry is the degree to which the invasion is intended or is the foreseeable result of authorized government action. So, too, are the character of the land at issue and the owner's "reasonable investment-backed expectations" regarding the land's use. . . . Severity of the interference figures in the calculus as well.
Op at 14-15.
The Court sent the case back to the Federal Circuit to take a crack at applying these factors.
Wednesday, November 21, 2012
Just when it seems as if the "takings clause revolution" is over, it re-emerges. This time, the property is not a "little pink house," but raisins.
The United States Supreme Court has granted certiorari in Horne v. USDA. As we discussed last year, the Ninth Circuit upheld the constitutionality of a USDA regulatory scheme regarding raisins against a takings clause challenge. The central requirement at issue mandates that a certain percentage of a raisins be put in "reserve" each year - - - this fluctuates yearly and by controlling raisins on the market is a means of indirectly controlling prices. The Hornes argued that "the requirement that they contribute a specified percentage of their annual raisin crop to the government-controlled reserve pool constitutes an uncompensated per se taking in violation of the Fifth Amendment."
Friday, October 5, 2012
Oral argument this week in Arkansas Game & Fish Commission v. United States revealed little certainty in the test—much less the result—in a Takings Clause claim when the government releases water from an upstream dam, temporarily flooding and damaging downstream property. Even after a barrage of probing questions and hypotheticals, the parties struggled to convey a clear test that would yield determinate results beyond this case. Still, it seemed that they both might agree that a strict formalistic test—judging a “permanent” flood a taking, but a “temporary” flood a non-taking—may not be the best choice. But as to any new test, and how it might apply in new cases, it seems, the best either party could say is: It depends.
The case arose out of a series of planned releases of water from the Clearwater Dam by the Army Corps of Engineers. These releases were deviations from the Corps’ operating plan for the Dam and were approved by a working group comprised of interested individuals and groups. The Arkansas Commission claimed that the releases caused annual temporary flooding on its property, the Dave Donaldson Black River Wildlife Management Area, 110 miles downstream from the Dam, which permanently damaged unique hardwood trees and the wildlife they support. The lower court, the United States Court of Appeals for the Federal Circuit, ruled that the releases and the resulting floods did not amount to a taking, because they only produced temporary flooding, not permanent flooding.
It may not be a big surprise that the parties and justices struggled with a clear test, given the challenges in figuring out whether the government’s temporary release of water at a remote dam and the resulting flooding on downstream property effected the kind of taking that the Takings Clause is designed to address—especially when the releases were designed to protect other public interests at and around the Dam. The problem is that a temporary flood looks a little like a nonintrusive trespass—maybe like, as Justice Breyer asked, a Department of Interior employee trampling paths on private land (on the one hand)—and a little like a physical invasion by the government that causes permanent damage (on the other). If the former, it looks less like a taking (and more like a trespass); if the latter, it looks more like a taking. Another problem: the releases 115 miles upstream from the Management Area may not have been the direct cause of its flooding, that is, there may have been other, contributing causes. And we don’t know what’s the relevant baseline for comparison: The water level in the Management Area before the Dam was constructed? The water level after the Dam was constructed, under the normal water release plan? The water level based on the deviations? Or some other baseline? Finally, temporary flooding doesn’t necessarily result in long-term damage or deprivation or property (because the water might simply recede); permanent flooding does. All these problems were on full display at the argument this week.
The lower court navigated these issues in a categorical way, saying that permanent floods are takings while temporary floods are not—an easy answer, even if perhaps overly formalist, and one that the Federal Circuit said was rooted in precedent. In this case, said the lower court, the floods were temporary—no taking.
Arkansas disagreed. It argued that the test for determining whether a government flood is a taking should look to whether the government action is direct, predictable, and substantial—a totality-of-the-circumstances approach that looks to the facts. Arkansas said that the totality pointed to a taking here, but might not in other similar situations.
The government argued that the flooding and any resulting damages were too loosely related to the Corps’ releases. After all, the releases occurred 115 miles upstream—enough distance to allow any number of contributing and intervening acts to break the causal chain. In any event, according to the government, any flooding on the Management Area was just an incidental result of the Corps’ operation of the Dam. In other words, the Corps didn’t target the releases to flood the Management Area; instead, it designed the releases to serve other public interests, with the incidental effect of flooding.
On balance, the parties and the Court seemed to move beyond the lower court’s formalistic approach into a new, more holistic test based on the circumstances. But neither party could produce a coherent, workable test that could apply to this case and beyond.
One possibility is that the Court could craft a test based on the directness of the government action, the predictability of the action, or the substantial nature of the action, or some combination of those and even other factors, and remand for application. Another possibility: the Court could write its test and apply it. In any event, there weren’t enough strong signals from the justices to predict a result, but, on balance, the Court seemed to lean toward a taking.
Friday, September 14, 2012
A state judge has declared sections of the controversial 2011 Wisconsin Act 10 unconstitutional as violative of state constitutional provisions. This follows a federal district judge also declaring portions of Act 10 unconstitutional in March.
In today's 27 page opinion in Madison Teachers Inc. v. Walker by state judge Juan Colas rejected the challenges based on the state constitutional provision limiting special sessions and the takings clause, as well as arguments that the controversy was nonjusticiable.
However, the judge found Act 10 violated the free speech, free association, and equal protection state constitutional protections, construing them as consistent with federal interpretations of the First and Fourteenth Amendments. Much of the judge's reasoning stressed that Wisconsin did not come forward with any arguments. The judge also found that there was a violation of the Wisconsin constitutional provision guaranteeing Milwaukee home rule.
[image: protests of Act 10 via]
Monday, November 14, 2011
An interesting segment on NPR's Morning Edition comparing Ayn Rand's economic thoughts to pronouncements of current politicians. Rand is the author of the novels Atlas Shrugged (1957) and The Fountainhead (1943).
The highlight is a 1959 interview with Rand by Mike Wallace, who asks about the United States' political direction of "the gradual growth of social, protective legislation, based on the principle that we are our brothers' keepers."
These programs are destroying individual liberties, Rand says, especially the freedom of producers, entrepreneurs, businessmen. The government has no right to take their property, she says.
"I imagine that you're talking now about taxes," Wallace says. "And you believe that there should be no right by the government to tax. You believe that there should be no such thing as unemployment compensation, regulation during times of stress."
"That's right," Rand replies. "I am opposed to all forms of control. I am for an absolute, laissez-faire, free, unregulated economy."
A video of the interview is available in 3 parts; here's part 1:
While the usual constitutional law link might be Lochner, Rand's interview could prompt an interesting discussion of Commerce Clause, Takings Clause, or Taxing Clause, or Campaign Finance cases - - - and of course the Affordable Care Act (last discussed here).
Wednesday, July 27, 2011
The raisins so prominent in morning cereal and children's snacks are "heavily regulated" agricultural commodities under marketing orders promulgated by the USDA (United States Department of Agriculture) under the authority of the Agricultural Marketing Agreement Act (AMAA) of 1937, as amended, 7 U.S.C. § 601 et seq.
In its opinion in Horne v. USDA, the Ninth Circuit upheld the imposition of civil assessments under the regulations and upheld the constitutionality of the regulatory scheme. The central requirement at issue mandates that a certain percentage of a raisins be put in "reserve" each year - - - this fluctuates yearly and by controlling raisins on the market is a means of indirectly controlling prices.
The Hornes' administrative and statutory claim was that they had reorganized their raisin business and were no longer subject to the regulations because they were no longer "handlers" but only "producers."
Their major constitutional claim was that even if subject to the regulations, "the requirement that they contribute a specified percentage of their annual raisin crop to the government-controlled reserve pool constitutes an uncompensated per se taking in violation of the Fifth Amendment." They also claimed that the penalities imposed for their “self-help” noncompliance (caused by their reorganization in an attempt to escape from the regulations) violated the Eighth Amendment's Excessive Fines Clause.
The Ninth Circuit panel opinion has an excellent rehearsal of regulatory takings doctrine, which clearly does not support the Hornes' claim. However, as the opinion notes,the Hornes claim that the Ransin Marketing Order is a physical taking because there is an annual “direct appropriation” of their reserve-tonnage raisins. The panel rejected this construction: "Though the simplicity of their logic has some understandable appeal—their raisins are personal property, personal property is protected by the Fifth Amendment, and each year the RAC “takes” some of their raisins, at least in the colloquial sense—their argument rests on a fundamental misunderstanding of the nature of property rights and instead clings to a phrase divorced from context."
Instead, as the panel reasoned,
the Raisin Marketing Order applies to the Hornes only insofar as they voluntarily choose to send their raisins into the stream of interstate commerce. Simply put, it is a use restriction, not a direct appropriation. The Secretary of Agriculture did not authorize a forced seizure of forty-seven percent of the Hornes’ 2002-03 crops and thirty percent of their 2003-04 crops, but rather imposed a condition on the Hornes’ use of their crops by regulating their sale.
The panel then cited a Ninth Circuit opinion from 1938 - - - Wallace v. Hudson-Duncan & Co., 98 F.2d 985 - - - rejecting a takings challenge to a reserve requirement under the walnut marketing order. The panel therefore joined the Court of Federal Claims, which not long ago decided the same question under the Raisin Marketing Order, Evans v. United States, 74 Fed. Cl. 554 (2006), aff’d, 250 Fed. Appx. 321 (Fed. Cir. 2007); in accord with a smiliar case rejecting a challenge to the reserve program under the almond marketing order, Cal-Almond, Inc. v. United States, 30 Fed. Cl. 244 (1994).
On the Eighth Amendment claim, the panel applied the test from United States v. Bajakajian, 524 U.S. 321(1998), considering whether the assessment is imposed, at least in part, for punitive and not merely remedial purposes, and whether the fine is grossly disproportional to the gravity of the offense for which it is imposed. Affirming the district judge, the panel found the fine was remedial and the infractions serious. It also noted that the fines were not as "steep" as those authorized by the statute.
The panel's conclusion notes the Hornes' frustration with the raisin regulatory scheme, but observes that the judicial role "is limited to reviewing the constitutionality and not the wisdom of the current regulation." The Hornes' remedy, the opinion suggests, is with the Secretary of Agriculture.