A federal regulatory takings claim being litigated in the first instance in federal court? Why, that’s as rare as hen’s teeth.
Here’s the deal: under Williamson County Regional Planning Comm’n v. Hamilton Bank,473 U.S. 172 (1985), a federal regulatory takings claim is not ripe until the property owners has first pursued compensation through available state procedures. In other words, property owner, go first to state court. But under City of Chicago v. Int’l College of Surgeons, 522 U.S. 156 (1997), the same rules don’t apply to the government, since it can choose to remove a state court takings claim to federal court, and have the property owner’s federal claims heard initially in federal court. So in those rare circumstances when a local government wants to buck conventional wisdom and litigate a takings claim in federal court, it has the choice of forum.
For one recent example of this see the Northern District of California case Yamagiwa v. City of Half Moon Bay, No. 05-4149 VRW (Nov. 28, 2007). In that case, not only did the city remove the case to federal court, it had the audacity to ask the court after a weeks-long trial which it lost, to dismiss the case since it should have been brought in state court. The court was having none of that, and rightly rejected the move, stating that it “smacks of bad faith.”
Perhaps removal of federal takings claims to federal court by local government is becoming a trend. A recent case filed in Hawaii state court that alleges among other things, a federal regulatory takings claim, was recently removed to federal court by the defendant county. The state court complaint in that case is here, and the Notice of Removal is here. At least there shouldn’t be any Williamson County ripeness issues.