SCOTUS Nominee Sotomayor On Takings Issues

Second Circuit Judge Sonia Sotomayor, the nominee to fill Justice David Souter's seat on the U.S. Supreme Court, has served as either a federal District or Circuit Judge for 18 years during which she's either authored or sat on panels in cases involving eminent domain or regulatory takings.  Here's an admittedly unscientific sampling of those decisions, which reveal a mixed bag on the property issue:

• Brody v. Village of Port Chester, 434 F.3d 121 (2d Cir. 2005) (Sotomayor on panel).  This decision represents the most favorable case for property owners, although it is more a due process than a takings case.  The panel held that New York's eminent domain law deprived the property owner of due process notice, and that when the law provides a short time frame to institute a challenge to a condemnation, the government has an obligation to provide express notice of the time frame. The court held:

  Thus, while the legislative decision to condemn is not reviewable, the purpose of the condemnation is. The role of the judiciary, however narrow, in setting the outer boundaries of public use is an important constitutional limitation. To say that no right to notice or a hearing attaches to the public use requirement would be to render meaningless the court's role as an arbiter of a constitutional limitation on the sovereign's power to seize private property.

  The district court's opinion on remand is summarized here.

• In an earlier decision in the same litigation, the Second Circuit in an opinion authored by Judge Sotomayor held that a property owner had standing to challenge the lack of individual notification of the taking of his property, and that the owner was not precluded from asserting a due process challenge because he would not have raised it as a defense to the taking under New York's eminent domain law.  On the issue of the remedy available to the property owner (who sought return of his land), Judge Sotomayor refused to order the return of the property, and wrote:

  We recognize that at least one other circuit appears to order reinstatement and backpay as a remedy in employment cases before a new hearing is held. This intermediate remedy would be analogous to ordering a return of Brody's property upon a finding of a due process violation, and then requiring the Village to begin again and initiate condemnation procedures that complied with due process, regardless of the likely merits of Brody's challenge in the Article 2 process. While we express no view on what the appropriate remedy would be for denials of due process in the employment context, we find that the reliance interests of third parties in this case are sufficiently compelling that Brody is entitled to a return of his property only if he can prove that any denial of due process made a difference in the condemnation proceedings. Moreover, in cases such as this one, we believe that these same reliance interests create a strong incentive for the condemnor to comply with the requirements of due process before the property has been condemned and development has begun, in light of the risk that a court somewhere down the road might order a return of the property.

  Brody v. Village of Port Chester, 345 F.3d 103, 120-121 (2d Cir. 2003) (citations and footnote omitted).  Cf. Ciszewski v. New York, 279 Fed. Appx. 39 (2d Cir. 2008) (not reported in the Federal Reporter) (unsigned summary order; Sotomayor on panel) (property owner precluded from raising due process challenges to a taking when owner did not challenge public use).

• Didden v. Village of Port Chester, 173 Fed. Appx. 931 (2d Cir. 2006) (not reported in the Federal Reporter) (unsigned summary order; Sotomayor on panel) appears to be the the only case in which a Kelo-like situation was presented (the order cited Kelo as the reason it was "obliged to conclude that [the property owners] have articulated no basis upon which relief can be granted." Professor Richard Epstein has summarized the case and Judge Sotomayor's role in it here:

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. Justice Stevens wrote that the public deliberations over a comprehensive land use plan is what saved the condemnation of Ms. Kelo's home from constitutional attack. Just that element was missing in the Village of Port Chester fiasco. Indeed, the threats that Wasser made look all too much like the "or else" diplomacy of the Obama administration in business matters.

• Gherardi v. New York, 161 Fed. Appx. 60 (2d Cir. 2005) (not reported in the Federal Reporter) (unsigned summary order; Sotomayor on panel) gives some indication that Judge Sotomayor has no real issues with the regulatory ripeness rules of Williamson County Regional Planning Comm'n v. Hamilton Bank of Johnson City, 473 U.S. 172 (1985).  The court in Gherardi rejected an as applied takings challenge because the plaintiffs did not allege they applied for, and were denied, development approvals.  See also Leone v. Whitford, 300 Fed. Appx. 99 (2d Cir. 2008) (not reported in the Federal Reporter) (unsigned summary order; Sotomayor on panel) (affirming the dismissal of a regulatory takings claim for failure to exhaust administrative remedies under Williamson County); Webster v. National Fuel Gas Supply Corp., 268 Fed. Appx. 85 (2d Cir. 2008) (not reported in the Federal Reporter) (unsigned summary order; Sotomayor on panel) ("We dismiss the inverse condemnation claim encompassed in Webster's complaint in order to allow the New York state courts to adjudicate this claim in the first instance.").

• Also in the ripeness context, Judge Sotomayor was on the panel in a prisoner habeas corpus appeal, in which the court contrasted prudential ripeness with "more fundamental and more rigid, constitutionally-based" ripeness:

  The notion of ripeness, as a doctrine of prudence, has become a staple in the adjudication of claims that a state or municipality has taken property without providing just compensation. In that context, a plaintiff must obtain a final decision from the regulatory body that the plaintiff alleges has taken his or her property, and the plaintiff must also seek compensation through any procedures the state has in place. See Suitum v. Tahoe Reg'l Planning Agency, 520 U.S. 725, 733-34, 117 S.Ct. 1659, 137 L.Ed.2d 980 (1997). Until a plaintiff can demonstrate that both of these requirements are met, the plaintiff's regulatory takings claim is generally deemed not ripe. Id. But since the doctrine is driven by judicial prudence rather than the Constitution, a court is free to exercise jurisdiction over such a case when the circumstances so warrant. See Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 1012-13, 112 S.Ct. 2886, 120 L.Ed.2d 798 (1992) (noting that a takings plaintiff's opportunity to apply for a special permit "goes only to the prudential 'ripeness'" and deciding that prudence dictated that the Court reach the merits in that case-given that Article III injury had properly been alleged-since the special permit scheme that the plaintiff had not complied with had been established only late in the litigation).

  Simmonds v. INS, 326 F.3d 351, 358 n.7 (2d Cir. 2003).

• Judge Sotomayor was the district judge in a bankruptcy case which involved a claim of a regulatory taking.  In In re St. Johnsbury Trucking Co., 199 Bankr. 83 (S.D.N.Y. 1996) and 191 Bankr. 122 (S.D.N.Y. 1996), she summarily dismissed a claim that the regulation was a taking even though she agreed that they wiped out the value of property ("St. Johnsbury protests that these two sections, as distinct from the other undercharge defenses, "destroy the entire economic value of St. Johnsbury's undercharge claims" against small shippers and for claims accruing prior to September 30, 1990. Indeed they do."):

  As a matter of law, the question of whether a regulatory action rises to the level of an unconstitutional taking is governed by the three-part test enunciated in Penn Central Transp. Co. v. City of New York, 438 U.S. 104, 98 S.Ct. 2646, 57 L.Ed.2d 631 (1978) and refined in Connolly v. Pension Benefit Guarantee Corp., 475 U.S. 211, 106 S.Ct. 1018, 89 L.Ed.2d 166 (1986). The Whittier court analyzed the takings issue raised by St. Johnsbury in light of Connolly and I agree with its analysis. Whittier, 57 F.3d at 650-51. Connolly held that Congress has the freedom to "adjust the benefits and burdens of economic life to promote the common good." Connolly, 475 U.S. at 225, 106 S.Ct. at 1026. That is what Congress did by enacting the Rates Act.