When you a federal takings plaintiff in the Federal Circuit and you pull Judge Timothy Dyk on your panel, your heart sinks. More so when he aggressively questions you in oral argument. And when you see he has written the opinion, you know it's game over at this level.
Because we can't remember a single case in which he's ever held for a property owner in a regulatory takings or inverse case. He just doesn't like property owners and their takings claims, apparently. His last big decision on flood takings, Arkansas Game and Fish, adopted a per se rule that any flooding which the owner could not prove was "permanent" is categorically immune from takings liability. His opinion for the Federal Circuit was reversed unanimously by the Supreme Court, in an opinion by Justice Ginsburg, which alone should tell you something.
Well, Judge Dyk is at it again with a flooding case, a fascinating case we've been following, the just compensation claim by victims of the disastrous Katrina flooding against the federal government.
In February, a three-judge panel of the Federal Circuit held oral arguments considering the feds' appeal from the judgment of the Court of Federal Claims holding the U.S. liable for a taking, and determining compensation. Stream the arguments here:
After listening to the arguments, we had little doubt that if Judge Dyk was the one assigned the majority opinion, it would not be a decision favorable to the property owners.
The Judge Dyk-authored opinion, issued by the court last Friday, bears out our prediction: property owners lose. No taking, because the Katrina flooding caused mostly by the federal government's construction and maintenance of a navigation project, the Mississippi River Gulf-Outlet canal (known as MR-GO), could only result in tort liability for which the federal government has already been determined to be immune. MR-GO was an attempt to improve navigation, and it obviously wasn't the sole cause of the flooding, but by all accounts it simply ended up worsening dramatically and magnifying the effect of Katrina. Schlimmbesserung: to worsen by improvement.
But to the Federal Circuit, this was at most a case of negligence, not takings.
This despite very comprehensive rulings by the Court of Federal Claims on both takings liability, and just compensation. We won't go over the CFC's reasoning here (please read the posts on the decisions for more), and we are on the run today, so don't have time to go into the details of the Federal Circuit's opinion reversing in favor of the government, but for now leave you to read the court's relatively short opinion, which starts this way:
We conclude that the government cannot be liable on a takings theory for inaction and that the government action in constructing and operating MRGO was not shown to have been the cause of the flooding. This is so because both the plaintiffs and the Claims Court failed to apply the correct legal standard, which required that the causation analysis account for government flood control projects that reduced the risk of flooding. There was accordingly a failure of proof on a key legal issue. We reverse.That's a bit disingenuous, because the remainder of the opinion doesn't so much focus on a lack of evidence, but in reality adopts a categorical rule that "inaction" in maintaining MRGO results in a blanket exception to takings liability. This diverges from at least four other lower courts (the Court of Appeal of Maryland, that state's highest court, and the Supreme Courts of California, Florida, and Minnestota), which conclude that government inaction in the face of a duty to act supports an inverse condemnation claim. And remember in Arkansas Game and Fish where the Supreme Court cautioned against per se rules in flood takings cases?
Because government-induced flooding can constitute a taking of property, and because a taking need not be permanent to be compensable, our precedent indicates that government-induced flooding of limited duration maybe compensable. No decision of this Court authorizes a blanket temporary-flooding exception to our Takings Clause jurisprudence, and we decline to create such an exception in this case.
Something tells us we haven't seen the last of this case.