Tag: Fifth Amendment

A Special Kind of Eminent Domain Abuse

In federal eminent domain cases, the “scope of the project” rule requires that in determining “just compensation” under the Fifth Amendment’s Takings Clause, any increase or decrease in property value caused by the federal project be disregarded.  As it turns out, the federal government had discussed the idea of expanding Everglades National Park for over 30 years, and also induced the local government to enact tougher zoning standards that decreased the value of the property that was to be taken for this purpose.  This type of behavior is a special kind of eminent domain abuse called “condemnation blight.”

The Everglades-related federal actions forced Gilbert Fornatora to watch the value of his South Florida property decline until the federal government finally condemned it – and paid him much lower compensation than he would otherwise have received.  Then, once condemnation proceedings began, the government manipulated the hearing schedule by front-loading ill-prepared owners who lacked counsel, thereby setting a low valuation precedent that would then be applied to the later parties with representation, like Fornatora.  The Eleventh Circuit sided with the government, so Fornatora petitioned the Supreme Court to review the case.

Cato filed an amicus brief supporting this petition, arguing that property owners have virtually no “scope of the project” protection if they must prove that the government’s sole or primary purpose for pre-condemnation action was to depress property values for later eminent domain proceedings.  A more workable test, consistent with due process, is merely to require evidence of a nexus between the government’s actions and the depressed property value.  The Court should also hear this case to ensure that just compensation proceedings comport with the due process, equal protection, and general fairness standards the government is required to follow in a variety of other settings.

The Court will be deciding early in the new year whether to hear the case, which has the ungainly name of 480.00 Acres of Land v. United States.

Taking Land for Public Uselessness

Over at the Washington Examiner, Tim Carney reports that Pfizer is abandoning its New London offices and deciding what to do with the property it gained in the infamous Kelo v. New London land-grab:

The private homes that New London, Conn., took away from Suzette Kelo and her neighbors have been torn down. Their former site is a wasteland of fields of weeds, a monument to the power of eminent domain.

But now Pfizer, the drug company whose neighboring research facility had been the original cause of the homes’ seizure, has just announced that it is closing up shop in New London.

To lure those jobs to New London a decade ago, the local government promised to demolish the older residential neighborhood adjacent to the land Pfizer was buying for next-to-nothing. Suzette Kelo fought the taking to the Supreme Court, and lost. Five justices found this redevelopment met the constitutional hurdle of “public use.”

That this purported “public use” is now exposed as the façade for corporate welfare that it always was is, of course, little comfort to Suzette Kelo and the other homeowners whose land was seized. But hopefully this will be an object lesson for other companies considering eminent domain abuse as a route to acquire land on the cheap – and especially for state and local officials who acquiesce in this type of behavior.

You can read Cato’s amicus brief for the ill-fated case here. Cato also hosted a book forum for the story of Suzette’s struggle, Little Pink House, featuring the author, Jeff Benedict, the attorney who argued the case, the Institute for Justice’s Scott Bullock, and Ms. Kelo herself, here.

HT: Jonathan Blanks

The Constitutional Right to Save Lives

Our friends at IJ have filed an exciting new lawsuit, one that, if successful, could save the lives of more than 1,000 people a year: people who die needlessly of assorted blood diseases (including leukemia) because the federal government criminalizes the offering of even modest compensation for bone marrow donation.

That is, the National Organ Transplant Act – which outlawed the sale of kidneys and other organs – for some reason included bone marrow.

NOTA’s criminal ban is unconstitutional because it arbitrarily treats bone marrow like nonrenewable solid organs instead of like other renewable or inexhaustible cells – such as blood or sperm – for which compensated donation is legal.  (That makes no sense because bone marrow, unlike kidneys, replenishes itself in just a few weeks, leaving the donor whole. )

The ban also fails constitutional muster because it irrationally interferes with the right to participate in safe, accepted, lifesaving, and otherwise legal medical treatment.

As Chip Mellor, president and general counsel of the Institute for Justice, said in a press release announcing the case:  “Bad things happen when the federal government exceeds its constitutional authority.  In this case, people actually die.  The Institute for Justice intends to stop that and to restore constitutional constraints that prohibit arbitrary limits on individual liberty.”

IJ brought this suit on behalf of adults with deadly blood diseases, the parents of sick children, a California nonprofit, and a world-renowned medical doctor who specializes in bone marrow research.  You can find more information here.  Perhaps more interestingly, IJ senior attorney Jeff Rowes is guest-blogging about the case all week at the Volokh Conspiracy.  Here’s his first post.

A New Court Term: Big Cases, Questions About the New Justice

Today is the first Monday in October, and so is First Monday, the traditional start of the Supreme Court term.  The Court already heard one argument – in the Citizens United campaign finance case – but it had been carried over from last year, so it doesn’t really count.

In any event, continuing its trend from last term, the Court has further front-loaded its caseload – with nearly 60 arguments on its docket already.  Fortunately, unlike last year, we’ll see many blockbuster cases, including:

  • the application of the Second Amendment to state gun regulations;
  • First Amendment challenges to national park monuments and a statute criminalizing the depiction of animal cruelty;
  • an Eighth Amendment challenge to life sentences for juveniles; a potential revisiting of Miranda rights;
  • federalism concerns over legislation regarding the civil commitment of “sexually dangerous” persons;
  • a separation-of-powers dispute concerning the agency enforcing Sarbanes-Oxley;
  • judicial takings of beachfront property; and
  • notably in these times of increasing government control over the economy, the “reasonableness” of mutual fund managers’ compensation.

Cato has filed amicus briefs in many of these cases, so I will be paying extra-close attention.

Perhaps more importantly, we also have a new justice – and, as Justice White often said, a new justice makes a new Court.  While Sonia Sotomayor’s confirmation was never in any serious doubt, she faced strong criticism on issues ranging from property rights and the use of foreign law in constitutional interpretation to the Ricci firefighters case and the “wise Latina” speeches that led people to question her commitment to judicial objectivity.  Only time will tell what kind of justice Sotomayor will be now that she is unfettered from higher court precedent – and the first term is not necessarily indicative.

Key questions for the new Court’s dynamics are whether Sotomayor will challenge Justice Scalia intellectually and whether she will antagonize Justice Kennedy and thus push him to the right.  We’ve already seen her make waves at the Citizens United reargument – questioning the scope of corporations’ constitutional rights – so it could be that she will decline to follow Justice Alito’s example and jump right into the Court’s rhetorical battles.

In short, it’s the first day of school and I’m excited.

Monday Links

  • Podcast: When Germany enacted their own “Cash for Clunkers” scheme, some of the old vehicles were illegally exported and sold out of the country before being destroyed. Could it happen here? Would that be so bad?

Richard Epstein on Sotomayor

Cato adjunct scholar Richard Epstein of the University of Chicago and New York University, finds much to worry about in Judge Sonia Sotomayor’s nomination to the Supreme Court:

The treatment of the compensation packages of key AIG executives (which eventually led to the indecorous resignation of Edward Liddy), and the massive insinuation of the executive branch into the (current) Chrysler and (looming) General Motors bankruptcies are sure to generate many a spirited struggle over two issues that are likely to define our future Supreme Court’s jurisprudence. The level of property rights protection against government intervention on the one hand, and the permissible scope of unilateral action by the president in a system that is (or at least should be) characterized by a system of separation of powers and checks and balances on the other.

Here is one straw in the wind that does not bode well for a Sotomayor appointment. Justice Stevens of the current court came in for a fair share of criticism (all justified in my view) for his expansive reading in Kelo v. City of New London (2005) of the “public use language.” Of course, the takings clause of the Fifth Amendment is as complex as it is short: “Nor shall private property be taken for public use, without just compensation.” But he was surely done one better in the Summary Order in Didden v. Village of Port Chester issued by the Second Circuit in 2006. Judge Sotomayor was on the panel that issued the unsigned opinion–one that makes Justice Stevens look like a paradigmatic defender of strong property rights.

I have written about Didden in Forbes. The case involved about as naked an abuse of government power as could be imagined. Bart Didden came up with an idea to build a pharmacy on land he owned in a redevelopment district in Port Chester over which the town of Port Chester had given Greg Wasser control. Wasser told Didden that he would approve the project only if Didden paid him $800,000 or gave him a partnership interest. The “or else” was that the land would be promptly condemned by the village, and Wasser would put up a pharmacy himself. Just that came to pass. But the Second Circuit panel on which Sotomayor sat did not raise an eyebrow. Its entire analysis reads as follows: “We agree with the district court that [Wasser’s] voluntary attempt to resolve appellants’ demands was neither an unconstitutional exaction in the form of extortion nor an equal protection violation.”

Maybe I am missing something, but American business should shudder in its boots if Judge Sotomayor takes this attitude to the Supreme Court. 

9/11 Memorial? Good. Eminent Domain Abuse? Bad.

The power of eminent domain, embodied in the Takings Clause of the Fifth Amendment, is so great that it nearly invites abuse, even when the government uses its power for constitutional, and even honorable, reasons.

Case in point: The U.S. Park Service has designed a memorial for Flight 93, the one that crashed in rural Pennsylvania on 9/11.  The plans have been in the works for some time, with the government and representatives of Flight 93’s victims working with the property owners—even explicitly assuring them in 2002 that eminent domain would not be used.

As time passed, however, and the self-imposed deadline to have a memorial in place for the 10-year anniversary of the tragedy grows nearer, the government has become impatient and now plans to condemn the land of the seven owners (representing about 500 of the planned 2,200 acre memorial and national park) who have not yet worked out a deal with the Park Service.

While there are two sides to every story, it seems that the property owners have been flexible and open to negotiation—a far cry from the extorting hold-outs against whom eminent domain is supposed to be invoked:

“It’s absolutely a surprise. I’m shocked by it. I’m disappointed by it,” said Tim Lambert, who owns nearly 164 acres that his grandfather bought in the 1930s. The park service plans to condemn two parcels totaling about five acres — land, he said, he had always intended to donate for the memorial.

“To the best of my knowledge and my lawyer, absolutely no negotiations have taken place with the park service where we’ve sat down and discussed this,” Lambert said.
Lambert said he had mainly dealt with the Families of Flight 93 and said he’s provided the group all the information it’s asked for, including an appraisal.

Even if some takings of property are warranted—a 9/11 memorial certainly fits the “public use” requirement—look at the abuse of power we have here.  Setting aside the question of why Lambert’s five acres are so crucial to a 2,200-acre project (and whether the memorial needs to be that large in the first place), why the strong-arm tactics?

Instead of letting an otherwise legitimate contract negotiation—the very foundation of our private property system—run its course, the government is resorting to robbing people because they had the misfortune to own the land near the place a historic tragedy occurred. This type of abuse is why eminent domain must be used sparingly, and why courts must be vigilant in enforcing the Fifth Amendment’s protection of property rights.

H/T: Nicki Kurokawa.