Marzulla Take on Takings

U.S. Supreme Court agrees to hear property rights case involving littoral rights, judicial taking, and State redefinition of property boundaries

libby@marzulla.com (Marzulla Law) — Tue, 30 Jun 2009 17:33:00 +0000

On June 15, 2009, the Supreme Court granted the petition for certiorari in Stop the Beach Renourishment, Inc. v. Florida Department of Environmental Protection (No. 08-1151), from the Florida Supreme Court.

After Hurricane Opal in 1995, the city of Destin and Walton County, Florida identified eroded beaches along the Gulf of Mexico and launched a beach renourishment program for 6.9 miles of beach and dunes. To accomplish this objective, the City and County obtained a permit from the Florida Department of Environmental Protection. As required by the permit, the City and County conducted a survey of the beach to locate a fixed Erosion Control Line. They then recorded this line, which had the legal effect of extinguishing “title to all lands seaward of the erosion control line . . . .” Fla. Stat. § 161.191(1). This land was now “deemed to be vested in the state by right of its sovereignty.” Id.

Prior to the issuance of the beach renourishment permit, an oceanfront boundary was the mean high water line, allowing the property line to directly abut the ocean. After the survey was recorded, the boundary changed to a fixed Erosion Control Line, depriving the private landowner of a flexible boundary that ebbed and flowed with the water line. Thus, the survey transformed an oceanfront landowner into an ocean-view landowner.

A coalition of riparian property owners known as Stop the Beach Renourishment filed suit challenging the constitutionality of the State’s actions under the Beach and Shore Preservation Act.

In Walton County v. Stop the Beach Renourishment, Inc., 998 So. 2d 1102 (Fla. 2008), as the case was called when it was before the Florida Supreme Court, the court held that the State did not take private property under the Beach and Shore Preservation Act, holding that the 100-year old littoral rights never really existed under Florida law.

The U.S. Supreme Court has now certified the following questions for review:

1. The Florida Supreme Court invoked “nonexistent rules of state substantive law” to reverse 100 years of uniform holdings that littoral rights are constitutionally protected. In doing so, did the Florida Court’s decision cause a “judicial taking” proscribed by the Fifth and Fourteenth Amendments to the United States Constitution?

2. Is the Florida Supreme Court’s approval of a legislative scheme that eliminates constitutional littoral rights and replaces them with statutory rights a violation of the due process clauses of the Fifth and Fourteenth Amendments to the United States Constitution?

3. Is the Florida Supreme Court’s approval of a legislative scheme that allows an executive agency to unilaterally modify a private landowner’s property boundary without a judicial hearing or the payment of just compensation a violation of the due process clauses of the Fifth and Fourteenth Amendments to the United States Constitution?

Petitioner’s opening brief is due on July 30, 2009.

SCOTUS blog has links to the cert. briefs.

libby@marzulla.com (Marzulla Law) — Wed, 03 Jun 2009 18:59:00 +0000

The Oregon Supreme Court has allowed all the parties participating in the Klamath v. United States certification proceeding to file a supplemental brief. These briefs are due June 4, 2009, and cannot be more than 15 pages. The Klamath Water Users plan to file a supplemental brief.

We anticipate that the United States, the State of Oregon, and the Pacific Coast Federation of Fishermen's Associations (PCFFA) will also file supplemental briefs.

To request an audio recording of the Klamath oral argument, call the Oregon Supreme Court at (503)986.5555.

Update on Casitas Municiple Water District v. United States

libby@marzulla.com (Marzulla Law) — Tue, 19 May 2009 17:29:00 +0000

The Supreme Court grated the United States' motion for extension of time to decide whether to seek Supreme Court review of the Federal Circuit’s decision in Casitas Municiple Water District v. United States, No. 2007-5153. So, now the Solicitor General has until June 17, 2009 to decide whether to petition for certiorari from the High Court.

Federal Circuit to Hear Class Action/Statute of Limitations

libby@marzulla.com (Marzulla Law) — Tue, 05 May 2009 17:17:00 +0000

Now being briefed in the Federal Circuit is a class action/statute of limitations decision, which could require dismissal of many of the class actions now pending in the Court of Federal Claims (CFC). The CFC decision, Fauvergue v. United States, holds that the six-year statute of limitations for Tucker Act claims (which the Supreme Court last year in John R. Sand construed as a strict, non-waivable limit on the court’s jurisdiction) bars the claim of any putative class member who has not completed the opt-in process within six years of the accrual of the claim. Since Fauvergue filed only a few days before the six-year statute ran, there was no time for class members to opt in, and the court therefore dismissed all of their claims. Another CFC decision, Kandel v. United States, goes the opposite way, but it is not yet on appeal. And DOJ has filed several similar motions to dismiss other pending CFC class action cases.

The Fauvergue decision is at odds with the usual practice in the Court of Federal Claims, which is to postpone class action certification until after discovery is completed—or even until after liability is determined. That means that class members often won’t opt in until a couple of years after the case is filed—frequently more than six years after accrual of the claim. If the Federal Circuit upholds the rule of Fauvergue, class action filings may look more like bid protests, requiring immediate briefing and decision after the complaint is filed so the court won’t lose jurisdiction under the statute of limitations.

The Fauvergue court was aware of the practical problems the decision creates, but felt bound by the existing court rule and precedent. The court said:

This court agrees that not tolling § 2501 for putative class members who take action after the expiration of the six-year limitations period does defeat the fundamental tenet and efficiencies of class actions as they are presently structured in the Court of Federal Claims. However, until otherwise dictated by the Federal Circuit or the Supreme Court, the impact of the binding precedent in Stone Container, American Pipe, and Crown Cork leads this court respectfully to come to the opposite conclusion as the Kandel court. Binding precedent dictates that our Government's waiver of sovereign immunity—as delineated in § 2501—is construed strictly and cannot be tolled equitably or statutorily for members of an opt-in class action in the Court of Federal Claims.

The Court of Federal Claims had previously rejected the normal opt-out rule for class actions that is the rule in district courts under the Federal Rules of Civil Procedure. But that was before this requirement that a plaintiff must file an opt-in class action well in advance of the six-year mark to allow time for certification, notice, and the opt-in procedure. This decision, if upheld by the Federal Circuit, may force a new debate on whether the CFC should adopt an opt-out rule under which the putative class members are before the court on the date of filing, so they are within the statute of limitations if the complaint is.

Will the Government seek Supreme Court review of the Federal Circuit’s decision in Casitas v. United States?

libby@marzulla.com (Marzulla Law) — Thu, 30 Apr 2009 16:34:00 +0000

The last time the Supreme Court heard a water rights takings case was in 1963 in Dugan v. Rank, 372 U.S. 609 (1963). One case possibly poised to be the next is Casitas Municipal Water District v. United States. The Government has until May 18 to decide whether to file a cert petition to challenge the Federal Circuit’s holding that the case is governed by the per se physical taking rule (under which the government must pay for every acre-foot of water it takes) rather than the more stringent Penn Central regulatory takings rule.

After losing a 2-1 panel decision, the Government petitioned for rehearing en banc. In a fractured opinion, the government’s motion was denied, despite vigorous dissents by four judges, three of whom joined in an opinion stating:

This denial implicates fundamental questions regarding takings law. The panel majority's opinion suggests that a government action can be construed to be a physical taking even if no physical proprietary interest has actually been taken by the United States. This is contrary to present Supreme Court law and contrary to our case law. Accepting this analysis of the panel majority eliminates the fine distinction and balance that has been established by the Supreme Court between physical and regulatory takings. Moreover, it eliminates the ability of the legislature to provide for limited and parsimonious legislation protecting endangered species.

Responding to the dissent, three judges stated:

Respectfully, we did offer a reason for treating Casitas’ water differently than the coal, trees, and other property involved in the regulatory takings cases cited by the dissent. The Supreme Court has repeatedly found water diversions to be physical takings. International Paper Co. v. United States, 282 U.S. 399 (1931); United States v. Gerlach Live Stock Co., 339 U.S. 725 (1950); Dugan v. Rank, 372 U.S. 609 (1963). In each of these cases, the United States physically diverted the water, or caused water to be diverted away from the plaintiffs’ property. In each of these cases the diverted water was dedicated to government use or third party use which served a public purpose. Under the facts of this case as configured on appeal, we are compelled to reach the same conclusion.

A variety of groups filed briefs amicus curiae in support of both sides of the case, including the State of California and the Tulare Lake Basin Water Districts.

If the government does not get Supreme Court review, the case returns to the trial court to be tried as a physical taking case.

Click here to read the Federal Circuit’s panel decision.
Click here to read the Federal Circuit’s decision denying rehearing.

Click here to read the amicus brief of the California Building Industry Association.
Click here to read the amicus brief of the California State Water Resources Control Board.
Click here to read the amicus brief of California Trout, Inc.
Click here to read the amicus brief of the Idaho Farm Bureau.
Click here to read the amicus brief of the Mountain States Legal Foundation.
Click here to read the amicus brief of the Natural Resources Defense Council.
Click here to read the amicus brief of the Pacific Legal Foundation.
Click here to read the amicus brief of Stockton East Water District.
Click here to read the amicus brief of Tulare Lake Water Basin Storage District.

Oregon Supreme Court to decide whether Klamath farmers have property rights

libby@marzulla.com (Marzulla Law) — Tue, 28 Apr 2009 17:57:00 +0000

On May 13, 2009, the Oregon Supreme Court, sitting in the Union High School gym in Klamath Falls, Oregon will hear oral argument on whether Klamath Reclamation Project farmers have a property right in the water they use to irrigate their crops. The Oregon Supreme Court accepted for decision three questions of Oregon law, certified to it by the Federal Circuit Court of Appeals, which arose during appeal of the decision of the Court of Federal Claims, dismissing the farmers’ claim for lack of a property right in the water.

The case arises out of the 2001 shut-off of all water deliveries from the Klamath Project in order to protect three endangered fish species. Rejecting the claim of the 1,400 Klamath Project farm families in this class action that under Oregon law as well as the federal Reclamation Act this was a Fifth Amendment taking, the trial court held:

[T]he court is mindful that . . . this ruling may disappoint a number of individuals who have long invested effort and expense in developing their lands based upon the expectation that the waters of the Klamath Basin would continue to flow, uninterrupted, for irrigation. But, those expectations, no matter how understandable, do not give those landowners any more property rights as against the United States, and the application of the Endangered Species Act, than they actually obtained and possess.

The Oregon Natural Resources Department and the environmental intervenors will file briefs, and have requested oral argument time as well.

The questions certified to the Oregon Supreme Court are:

Question 1: Whether, assuming that the United States appropriated water rights for the Klamath Project pursuant to the 1905 Oregon statute, that statute precludes other persons from obtaining a beneficial or equitable interest in those rights?

Question 2: Whether, under Oregon law, beneficial use by the person who receives the water from the Klamath Project is sufficient to give that person a beneficial or equitable interest in the water?

Question 3: Whether, under Oregon law, anyone may assert either a legal or an equitable property interest in water from the Klamath Project without first having gone through the pending state water rights adjudication?

Click here for the Oregon Supreme Court’s decision on certification.
Click here for the Federal Circuit’s certification order.
Click here for the decision of the Federal Claims Court.

Marzulla Law Announces "Marzulla Take on Takings" Blog Focuses on Takings and Contract Claims

libby@marzulla.com (Marzulla Law) — Thu, 23 Apr 2009 20:39:00 +0000

Welcome to “Marzulla Take on Takings.” In the upcoming months we will give our take on takings and contract claims in the U.S. Court of Federal Claims, the Federal Circuit Court of Appeals, and the Supreme Court.

For starters, we’re going to be posting updates on Klamath Irrigation District v. United States, No. 01-591 (CFC filed Oct. 11, 2001), and Casitas Municipal Water District v. United States, No. 07-5153 (Fed. Cir. appeal docketed Aug. 10, 2007). On May 15, 2009, Klamath will be argued before the Oregon Supreme Court. In Casitas the Government has until mid-May to file a petition for certiorari in the Supreme Court appealing the Federal Circuit’s decision denying rehearing and rehearing en banc.

Thanks for visiting our blog. We look forward to hearing from you!