For many years, Violet Dock Port had owned and operated a docking facility that stretched along a mile of the Mississippi River in St. Bernard Parish, Louisiana. As a private business, Violet Dock was in economic competition with the local Port Authority, which also owns and operates riverfront property. In 2007, the Port Authority took an interest in Violet Dock’s land and tried to negotiate a purchase. Those negotiations failed. Preferring to avoid competition with a private firm, the Port Authority colluded with Associated Terminals, another private company, to improve its position in the market. The Port Authority used its eminent domain power to condemn Violet Dock Port then leased it to Associated Terminals to continue the cargo operations. The idea was that the Port Authority could foreclose competition in the market and use the money made off the lease to Associated Terminals to improve its position and expand its operations in the future. When Violet Dock sued, claiming that the taking was pretextual, the trial court refused to acknowledge evidence that the scheme was concocted simply to boost the Port Authority’s position in the commercial market.
Cato supported the case in both the Louisiana Supreme Court and at the U.S. Supreme Court, but Violet Dock ultimately lost its case when the Supreme Court denied its petition. That allowed the taking to go forward but, under the Takings Clause, Violet Dock is still owed just compensation. Originally that was set at $16 million but was later raised to $29 million by a Louisiana court of appeals, with an additional $3.3 million in attorney fees. That was more than a year ago, but St. Bernard Parish still owes Violet Dock over $20 million, accruing $2,300 in interest per day. Violet Dock has filed another action against St. Bernard Parish, this time claiming that the failure to pay the judgment is also a violation of the Fifth Amendment.
Cato has joined the National Federation of Independent Business and the Southeastern Legal Foundation on a brief in the Fifth Circuit urging the court to rule that St. Bernard Parish cannot withhold payment without violating the Takings Clause. We argue that a state court monetary judgment constitutes a protected property interest as a matter of state law, and therefore a public authority’s refusal to pay that judgment is itself a taking—separate from, and independent of, the original taking that culminated in the judgment.
This case has gone on for nine years. Originally it was shocking that Louisiana, and ultimately the Supreme Court, would allow a brazenly pretextual taking. Now, it is equally shocking that St. Bernard Parish refuses to pay the judgment. The Fifth Circuit should stop the parish’s recalcitrance and let Violet Dock’s owners finally get paid.