Thanks to my fellow Damon Key land user Greg Kugle for letting me know the Federal Circuit has affirmed Palmyra Pacific Seafoods, L.L.C. v. United States, 80 Fed. Cl. 228 (Jan. 22, 2008), a case we summarized here. The Federal Circuit's opinion is available here.
The court held that licenses to use Palmyra Atoll as a commercial fishing base were not taken when the federal government declared the waters around the atoll as a wildlife refuge and prohibited commercial fishing. The court held that the licenses were not "property," and even if the licenses were rendered worthless, the takings clause was not implicated.
In attempting to define the property right that was purportedly taken by the regulation at issue in this case, the plaintiffs have provided little beyond the general assertion that the Interior Department interfered with their "exclusive right to use Palmyra as a commercial fishing base." They contend that "the contract entitled PPS to the exclusive occupation and use of certain lands of the atoll (e.g., the base camp)," and refer to a "right to use certain facilities on Palmyra as the base for its commercial fishing operation." The problem with that argument is that the Interior Department’s regulation does not prohibit commercial fishing operations on Palmyra—it merely prohibits commercial fishing activity in the surrounding waters. The fact that the government’s regulation of activities in the waters surrounding Palmyra may have adversely affected the value of their contract rights to engage in activities on shore is not sufficient to constitute a compensable taking.
Slip op. at 8-9 (footnote omitted). The court boiled the case down to a hypothetical:
The problem with the plaintiffs’ takings theory in this case, as well as their claim that "targeting" converted an otherwise innocuous regulation into a compensable taking, can be illustrated by a hypothetical case that contains all the essential elements of this case without the complicating details that tend to obscure the analysis. Suppose that a business that offers "outdoor adventures" obtains rights from a private party to build a facility next to a federally owned national wilderness area for the purpose of attracting adventurers who are interested in hiking in the wilderness area. Suppose further that the government, being concerned that the influx of large numbers of hikers will disrupt the wilderness area, closes the wilderness area to all hikers or strictly limits the number of hikers who can enter the area. In that event, no property right of the business has been taken, even if the government acted in direct response to the prospect of having a hiking tourism business next to the wilderness area. To be sure, the expectation of the outdoor adventure company has been disappointed, but it is not an expectation that was based on any property right that was taken, and thus the government did not effect a taking for which compensation must be paid. While it might be different if the government regulated activities on a private individual’s property—in the example, if the government were to prohibit private landowners from running a hiking business within 20 miles of a wilderness area—that is another matter altogether from the government regulating activities on its own property, or property over which it has full control, even if that regulatory action disappoints the expectations of nearby property owners. Accordingly, even if the Interior Department regulation in this case is regarded as "targeted" at the plaintiffs, it regulated conduct as to which they had no protectable property interest, and it therefore did not constitute a taking for which compensation had to be paid.
Slip op. at 15-16.