This is the third in a series of five posts taking a look at last week's landmark ruling by a sharply-divided Supreme Court, Knick v. Township of Scott, No. 17-647 (June 21, 2019). Here are the related posts:
In this post, we'll take a deeper dive into the three opinions: Chief Justice Roberts for the five-Justice majority (Roberts, Thomas, Alito, Gorsuch, Kavanagh), Justice Thomas' short stand-alone concurring opinion, and Justice Kagan's dissent (joined by Justices Ginsburg, Breyer, Sotomayor, and Kagan).
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BLUFs
Here are the bottom lines up front, the lenses though which we think you should read each of the opinions (and yes, the opinions are a must read, several times over).
First, the BLUF on the big question. Williamson County's state-litigation ripeness requirement overruled. Not cut back, not worked around, not questioned. Overruled. It is enough that the regulation take property, and the government hasn't already paid me. I have no obligation to "ripen" my federal claim by chasing down the local government for compensation in state court. (Barista's note: we were (happily) wrong when we thought that CJ Roberts might go wobbly and look for a federalism way out.)
Second, the analytical BLUF. At long last, it seems that a majority of the Justices understand what we in the property bar have been saying for decades: the essence of a federal "takings" claim against a local or municipal government is that a regulation deprives an owner of "productive use" of property and the government has not provided compensation (past tense). So nearly 100 years after Justice Holmes famously opined for the Court in Pennsylvania Coal Co. v. Mahon, 260 U.S. 393 (1922), that if a regulation goes "too far" it will be recognized as a taking, we have the Court finally expressing clearly what that cause of action looks like; Knick is the first time as far as we can tell that the modern Court has plainly stated the precise nature of the constitutional violation.
The third BLUF (the vibe): the unstated, but fundamental, world view difference between the Knick majority and the dissenters is that the dissenters view state courts as part-and-parcel of local government's compensation mechanism, while the majority assumes (rightly) that state courts are a separate branch of state governments.
The final BLUF, our Knick elevator speech. Our colleague Dwight Merriam asked us to comment for his Knick piece on law.com ("More than a 'Knick' - SCOTUS Overrules 'Williamson County' in Stunning Victory for Property Owners"), and we said this:
“The federal judiciary’s unnecessary thirty-year abandonment of property and takings cases is at long last over. The Court today rightly relegated to history’s dustbin a judicially-created doctrine that deprived property owners of a federal court forum to resolve federal constitutional claims. The decades of damage that Williamson’s County’s ripeness doctrine wrought on property owners cannot be retroactively undone of course, but by putting property rights on equal footing with other constitutional rights, today’s ruling is a step in the right direction. The Court rectified a mistake it never should have made, and rightly restored property owners’ rights to the ‘full-fledged constitutional status’ they should enjoy.”
Now, on to the details.
"That's some catch, that Catch-22"
The majority opinion began by laying out the one-two punch of Williamson County and San Remo: "The takings plaintiff thus finds himself in a Catch-22: he cannot go to federal court without going to state court first; but if he goes to state court and loses, his claim will be barred in federal court. The federal claim dies aborning." Slip op. at 1-2. [Note: even if the plaintiff wins in state court, he has no federal claim because by awarding compensation, the state court has in effect mooted the without just compensation problem.] "The San Remo preclusion trap should tip us off that the state-litigation requirement rests on a mistaken view of the Fifth Amendment." Slip op. at 2.
In defining a takings cause of action, timing is everything
Note that the majority doesn't say a problem with jurisdiction, or a problem with § 1983. This is a constitutional concern, not a matter of subject matter jurisdiction or statute. But the Court also noted that when there's a constitutional claim, § 1983 provides a federal cause of action in federal court, without the need to exhaust state remedies:
We now conclude that the state-litigation requirement imposes an unjustifiable burden on takings plaintiffs, conflicts with the rest of our takings jurisprudence, and must be overruled.
Slip op. at 2.
For sure, the Court overruling the state-litigation ripeness requirement is big. But to us, the more important part of that sentence is "conflict with the rest of our takings jurisprudence," because it signals that Knick tells us more about substantive takings doctrine than it does about the intricacies of federal procedure. The Court continued:
A property owner has an actionable Fifth Amendment takings claim when the government takes his property without paying for it.
Slip op. at 2. There it is. If you were to stop reading there - the middle of the second page of the slip opinion - you'd be fine. The rest of the opinion is important, of course, but the Chief cuts to the chase right away.
And while we're talking about defining what a violation of the Takings Clause looks like, skip forward a bit to page 14 of the slip opinion, where the majority correctly notes that to state a claim for a taking, the owner alleges either (1) a physical invasion, or (2) destruction of use, not loss of value:
That is quite different from the taking of property by the government through physical invasion or a regulation that destroys a property's productive use.
Slip op. at 14 (emphasis original).
The majority also summarized the biggest analytical hurdle, Williamson County's rationale which was supposedly based on the text of the Fifth Amendment ("nor shall private property be taken for public use without just compensation"), and acknowledges that the Fifth Amendment does not require payment contemporaneous with the taking as long as there are procedures in place for the owner "to obtain compensation after the fact." Slip op. at 2. The majority highlighted a distinction that it would delve into deeper later in the opinion -- the difference between equitable remedies for takings and compensation -- and concluded that a federal court § 1983 claim is ripe and may be filed upon the constitutional violation: "when the government takes his property without just compensation[.]" Id.
Two themes: equal treatment, constitutional text
The majority opinion stuck to two main themes.
First, property rights should be treated the same as other Bill of Rights rights. See, e.g., slip op. at 6 ("Plaintiffs assertion any other constitutional claim are guaranteed a federal forum under § 1983, but the state-litigation requirement 'hand[s] authority over federal takings claims to state courts.'") (quoting San Remo, 545 U.S. at 350 (Rehnquist, C.J., concurring)); slip op. at 6 ("The state-litigation requirement relegates the Takings Clause 'to the status of poor relation' among the provisions of the Bill of Rights.") (quoting Dolan v. City of Tigard, 512 U.S. 374, 392 (1994)).
The second theme which the majority employed was the text of the Fifth Amendment:
The Clause provides: "[N]or shall private property be taken for public use, without just compensation." It does not say: "Nor shall private property be taken for public use, without an available procedure that will result in compensation." If a local government takes private property without paying for it, the government has violated the Fifth Amendment -- just as the Takings Clause says -- without regard to subsequent state court proceedings.
Slip op. at 6.
Section 1983 recognizes a cause of action for a "deprivation" of a right "secured by the Constitution," and thus a "property owner may sue the government at that time in federal court[.]" Slip op. at 6-7. The federal claim for compensation "arises at the time of the taking, regardless of post-taking remedies that may be available to the property owner." Slip op. at 7. The Court relied on the 1933 case which requires that interest owed on a compensation award runs from the time of the taking, and includes both takings situations: affirmative exercises of the condemnation power, and inverse condemnations. Jacobs v. United States, 290 U.S. 13 (1933).
Interestingly, the majority noted that it doesn't matter for purposes of defining the constitutional violation whether it is eminent domain or some other governmental power being exercised, and "[t]he form of the remedy d[oes] not qualify the right." Slip op. at 7. See also slip op. at 8 ("Jacobs made clear that, no matter what sort of procedures the government puts in place to remedy a taking, a property owner has the Fifth Amendment entitlement to compensation as soon as the government takes his property without paying for it.").
Having recognized that the constitution itself mandates this result, the majority used this line of thought to directly attack Williamson County's rationale. See slip op. at 8-9. The obligation to pay compensation when property is taken is "self-executing," and "automatically arises at the time the government takes property without paying for it." Id. at 9.
Post-violation compensation is a remedy, not an element of a claim ("A bank robber might give the loot back, but he still robbed the bank.")
Critically, the Court also recognized the distinction between "without just compensation" being an element of a takings claim (Williamson County's rationale), and just compensation being a remedy for a regulatory taking:
A later payment of compensation may remedy the constitutional violation that occurred at the time of the taking, but that does not mean the violation never took place. The violation is the only reason compensation was owed in the first place.
Slip op. at 11.
In what is, in our view, the most evocative language in the majority, Chief Justice Roberts sums up that thought: "A bank robber might give the loot back, but he still robbed the bank." Id.
Equitable remedies or compensation?
The majority distinguished Ruckelshaus v. Monsanto Co., 467 U.S. 986 (1984), where the Court held that a property owner must seek compensation via Tucker Act in the Court of Federal Claims, and until she does so, the owner "has no claim against the Government for a taking." Id. at 194-95. The majority concluded that you have to read that case carefully, because the remedy which the plaintiff sought was to enjoin the allegedly offending regulation. Applying the old maxim that law comes before equity, the Court noted that Ruckelshaus only should be read to preclude equitable relief (inunction) when there's a legal remedy (compensation), not that an owner has no takings claim until after a Tucker Act claim is rejected. Slip op. at 13 ("Equitable relief was not available because monetary relief under the Tucker Act.").
Starting on page 16, the majority tackled what we thought was the biggest conceptual hurdle that Ms. Knick had to overcome: the idea that the Takings Clause "does not require that compensation be actually paid in advance of the occupancy of the land to be taken," in Cherokee Nation v. Southern Kansas R. Co., 135 U.S. 641 (1890). Like its treatment of Ruckelshaus, the majority distinguished Cherokee Nation by focusing on the remedy sought in that case: an injunction to stop the taking (not compensation):
Simply because the property owner was not entitled to injunctive relief at the time of the taking does not mean there was no violation of the Takings Clause at that time.
Slip op at 16. There's a huge difference in the majority's mind between trying to stop an exercise of the eminent domain power or a regulation because compensation hasn't first been paid, and trying to recover compensation once the property has been taken, either affirmatively or by regulation.
Why not let sleeping dogs lie?
Recall that at the first round of oral argument, Justice Breyer asked whether, even if Williamson County was a bad rule, shouldn't the Court "let sleeping dogs lie?"
JUSTICE BREYER: You don't have to -- the problem -- the problem -- I mean, you could say what Justice Gorsuch said, couldn't you? The state says: No, we're not going to pay you. Ha, because there's no compensation -there's no taking. Ha.
And we could say that's a final decision not to take it. We could. I mean, I don't see any logic. But Williamson didn't. So I thought: Well, why let the sleeping dog -- let it lie?
Tr. at 44-45.
Sitting there in the Court that day, we have to admit we were a bit taken aback by the thought, and found it hard to fathom that "yeah we were wrong, but so what" would be a reason to double down on Williamson County. Is repose more important than getting it right?
The majority responded to this thought and the dissent's outrage that by overruling Williamson County, the majority was creating a stare decisis crisis (say that three times). Noting the avalanche of criticisms from all sides of the spectrum, the majority noted the doctrine's "shaky foundations" and slow erosion from a seemingly mandatory jurisdictional rule to an optional prudential one. Slip op. at 21-22.
What, me worry?
Finally, the Court noted the practicalities: the Williamson County/San Remo combination was "unworkable in practice," slip op. at 22, and the sky won't fall because of the new Knick rule:
Our holding that uncompensated takings violate the Fifth Amendment will not expose governments to new liability; it will simply allow into federal court takings claims that otherwise would have been brought as inverse condemnation suits in state court.
Governments need not fear that our holding will lead federal courts to invalidate their regulations as unconstitutional. As long as just compensation remedies are available -- as they have been for nearly 150 years -- injunctive relief will be foreclosed. For the same reason, the Federal Government need not worry that courts will set aside agency actions as unconstitutional under the Administrative Procedures Act. Federal courts will not invalidate an otherwise lawful uncompensated taking when the property owner can receive complete relief through a Fifth Amendment claim brought under the Tucker Act.
Slip op. at 23 (citation omitted).
Separation of powers?
As we noted at the start of this post (and as we predicted a couple of weeks ago), one of the threads which we think illustrated the analytical split on the Court was whether state courts are part-and-parcel of a municipal government's compensation mechanism. The dissenters pretty plainly thought that state courts were an arm of local government, while the majority considered state courts to be separate. We don't have the time on this post to delve into municipal separation of powers and compare state judiciaries to the Court of Federal Claims, but we might do so down the road.
Benchslap
For an interesting sidebar before we leave the majority opinion and delve into the concurrence and dissent, check out footnote 5 on page 14 of the slip opinion, in which the majority chides the Solicitor General's argument that this is a § 1983 issue, not one with strictly constitutional dimensions. Recalling that it was the SG who raised ripeness in Williamson County (see the section "Sua Sponte" in our background post), the majority noted "[t]he Solicitor General continues that tradition here." Slip op. at 14 n.5. Ouch. The Court declined to consider the SG's difficult-to-follow argument that a state law takings claim "arises under" for purposes of jurisdiction and § 1983, and as a result, it remains unsettled whether a state law inverse condemnation claim "arises under" can be an independent basis for a federal court ticket. In our view, it doesn't matter, given the majority's holding that a federal takings claim is ripe for federal court.
We thought there was a chance that the majority would latch onto the SG's rationale (which upon multiple readings isn't as far out as it is at first blush). But no, the Court was pleasantly much more definitive.
Thomas, J., concurring: the "sue me" approach doesn't cut it
Justice Thomas issued a short two-page concurring opinion, noting also that he "join[ed] in full" the CJ Roberts' majority:
This "sue me" approach to the Takings Clause is untenable. The Fifth Amendment does not merely provide a damages remedy to a property owner wiling to "shoulder the burden of securing compensation" after the government takes property without paying for it. Our holding that uncompensated takings violate the Fifth Amendment. Instead, it makes just compensation a "prerequisite" to the government's authority to "tak[e] property for public use."
Thomas, J., concurring at 2. So why did he write separately?
For several of reasons, we think.
First, Justice Thomas emphasized that the Constitution's requirements are the requirements, and that we've always done it this way, and this might cost too much arguments aren't going to fly with him: "if this requirement makes some regulatory programs 'unworkable in practice,' then so be it -- our role is to enforce the Takings Clause as written." Id. (citation omitted). Strong stuff.
Second, Justice Thomas apparently does not care for nationwide injunctions, and Knick's focus on the compensation remedy over injunctive relief gave him a chance to ring that bell.
Finally, Justice Thomas notes that the Court's recognition of a federal takings claim that may be raised in federal court does not preclude other similar claims from being pursued, including "common-law tort claims, such as trespass." Make of that what you will.
Conclusions
We finally have -- nearly a century after Mahon -- a working cause of action for a federal regulatory taking: the government has regulated property by either forcing an owner to surrender even a small part of her right to exclude, or by depriving the owner of "productive use." If so, the government's obligation to provide compensation is "self-executing" and arises now, and does not need to wait. The owner may pursue a compensation remedy now, either in state or federal court. Pursuing and losing a state law inverse condemnation claim is not an element of a federal takings claim.
Next up: why not "let sleeping dogs lie," as Justice Kagan's strong dissent argues?
Knick v. Township of Scott, No. 17-647 (U.S. June 21, 2019)
