In this post -- the first in a series of deeper dives that we'll be posting about over the next few days about yesterday's U.S. Supreme Court opinion in Cedar Point Nursery v. Hassid, No. 20-107 (June 23, 2021) -- we'll be covering the background of the case, and the heart of the majority opinion.
Here are all of the posts in our Cedar Point series:
- Part I: SCOTUS's Strawberry Letter 23 To Property Rights
- Part II: Common Sense (Keep Out) And Common Law (The Right To Exclude)
- Part III: No, Chicken Little, The Sky Isn't Falling
- Part IV: The Other Opinions
- Part V: Help Us Help You
- Part VI: What Others Are Saying
And in case you missed the live webcast on Friday, July 16, 2021 that featured expert analysis of the case, please don't miss listening to the recording of ALI-CLE's "Takings and Eminent Domain After Cedar Point: What Practitioners Need to Know."
+++++++++++++++++++++++++++++++++++
Take off your lawyer hat for a minute and hark back to your days before law school. You remember, don't you? (Do you?) If you could go back in time and ask your younger self what it means to own property, what might you have responded?
We're guessing that like most regular people, your younger self would have replied that it meant, at heart, the owner could say "keep out," or "this is mine" (which is another way, we think, of saying keep out). (If that isn't what you think you would have responded, we're curious what first came to mind. If that's you, please let us know what your lay self would have answered.)
Our sense after reading (and re-reading) the 6-3 majority opinion authored by Chief Justice Roberts in Cedar Point Nursery v. Hassid, No. 20-107 (June 23, 2021) is that the Court was fueled by the same vibe, even though it never expressly said so. Yes, there was a lot of great technical, lawyerish stuff in the opinion about the "right to exclude," Blackstone, Loretto, Kaiser Aetna, and all that, but now that we've digested the opinions (majority, concurrence (Kavanaugh), and dissent (Breyer, Sotomayor, and Kagan)), we've come to the conclusion that the Court was undertaking what it called an "intuitive approach" (slip op. at 18) to defining the critical term in the case, the meaning of "private property" in the Fifth Amendment. Granted, the Court never says that's what it is doing, but read along and we think you will agree with our read of it.
Before we go further, a necessary disclosure: our law firm, Pacific Legal Foundation, represents the successful petitioners/property owners. I had little to do with the case since I only joined PLF a few months ago (although I did author an amicus brief at the cert stage prior to joining the firm). Now back to your regular programming.
Because we've been following the case for a long time and predicted that this one would end up at the Court, we're not going to go into great detail about the facts, and it might be simpler just to read one of our earlier posts. But here's the short story.
For a long time -- indeed decades -- California's Agricultural Labor Relations Board has had a regulation that requires agricultural employers to open their land to labor union organizers. The regulation is framed as protecting the rights of ag employees to "access by union organizers to the premises of an agricultural employer for the purpose of meeting and talking with employees and soliciting their support." The time, place, and manner of the union entries are not unlimited but are nonetheless pretty severe, giving the union to, in the words of the regulation a "right to take access" to an employer's property for up to 3 hours per day, 120 days per year. Remember the phrase "right to take access" because it's going to come back and haunt the Board once the case gets to the Supreme Court.
Two separate agricultural employers (one a strawberry farm, the other a grower of grapes and citrus) filed a § 1983 complaint against the Board in federal court for declaratory and injunctive relief, alleging the regulation was a taking under the Fifth Amendment, and an unlawful seizure under the Fourth Amendment. The district court granted the Board's motion to dismiss for failure to state a claim (12(b)(6)).
The Ninth Circuit affirmed (2-1), and over a strong dissental, denied en banc review, concluding that the allegations of the complaint did not state a plausible Loretto physical invasion takings claim under Twombly/Iqbal. The complaint pointedly did not raise a Penn Central ad hoc taking. The Ninth Circuit rejected the claim because the invasions were not permanent.
The Supreme Court agreed to review this question presented:
California law forces agricultural businesses to allow labor organizers onto their property three times a day for 120 days each year. The regulation provides no mechanism for compensation. A divided panel below held that, although the regulation takes an uncompensated easement, it does not effect a per se physical taking of private property because it does not allow “24 hours a day, 365 days a year” occupation. As an eight-judge dissent from denial of rehearing en banc noted, the panel “decision not only contradicts Supreme Court precedent but also causes a conflict split.”The question presented is whether the uncompensated appropriation of an easement that is limited in time effects a per se physical taking under the Fifth Amendment.
Chief Justice Roberts authored the majority opinion, in which Justices Thomas, Alito, Gorsuch, Kavanaugh, and Barrett joined. Right off the bat, you knew where this one was going when the opinion began with "[a] California regulation grants labor organizations a 'right to take access' to an agricultural employer's property in order to solicit support for unionization." Slip op. at 1. (If you're the government and the question is whether there's been a taking, and your regulation is phrased in terms of "taking," it's not likely going to be a good day.)
And it wasn't, at least from the government side of things. The Court concluded that "[w]hen the government physically acquires private property for a public use, the Takings Clause imposes a clear and categorical obligation to provide the owner with just compensation." Slip op. at 5 (citing Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Agency, 535 U.S. 302, 321 (2002)).
The majority noted three situations in which fall within the "physical taking" category:
- affirmative ("formal") exercises of eminent domain
- when government takes physical possession of property without obtaining title
- when government action results ("effects") an occupation of property
When any of these occur, that results in a categorical obligation to compensate.
The Court contrasted what it called "restrict[ions on] an owner's ability to use his own property," noting that "a different standard applies." Slip op. at 6. These are what are commonly known as "regulatory takings," but the Court cautioned that the "label can mislead." Id.
What we think the Court is getting at here is an essential point (and a preemptive rebuff of Justice Breyer's dissent): what we know as "physical takings" cases such as Loretto and Kaiser Aetna and Nollan do indeed fall under the general umbrella of "regulatory" takings because in those cases, the physical invasions were required by the government's exercise of its regulatory power (in Loretto and Nollan, the police power), and in Kaiser Aetna, the federal government's commerce power). That may be so, the Cedar Point opinion reminds, but the "regulatory" aspect of it should not distract us from the essential point: what matters is "whether the government has physically taken property for itself or someone else." Slip op. at 7. The means isn't as important as the result. A physical invasion is a physical invasion, "by whatever means." Id.
Having taken the steam out of the dissent's main argument, the majority then explained why California's regulation qualified as a physical invasion. That might seem obvious. Union organizers, under the regulation have the ability to enter Cedar Point's property 120 days per year for up to 3 hours per entry, and had exercised that right as the Court described in the opinion. See slip op. at 2 (noting the complaint alleged an unannounced 0500 hrs entry, with blaring bullhorns). But the Ninth Circuit's main sticking point -- that the entries the regulations require are not "permanent" ("24/7" as the Ninth Circuit put it) -- seemed to be supported by the language of Loretto, which spoke of permanent physical invasions being categorical takings. The question after Loretto was whether non-permanent invasions were also categorical takings, or should be subject to the Penn Central ad hoc takings test in which the nature of the government action as either requiring a physical invasion or simply adjusting the benefits and burdens of society was just one of the things a court would look at, as opposed to the only factor to consider.
The Court came down squarely on the side of nonpermanent invasions as being categorical takings. The reason why is the sanctity of the right to exclude. In other words, "keep out." Relying on the classic canon of physical invasion cases -- Causby (B-25's), Portsmouth (cannon fire), our old friend KaiserAetna (uninvited boaters), Loretto (that cable TV box), Nollan (beachcombers) and Horne (segregating raisins) -- the Court emphasized the "fundamental" nature of the right to exclude. Limiting that right really deprives the word "property" of its essential meaning:
The upshot of this line of precedent is that government-authorized invasions of property—whether by plane, boat,cable, or beachcomber—are physical takings requiring just compensation. As in those cases, the government here has appropriated a right of access to the growers’ property, allowing union organizers to traverse it at will for three hours a day, 120 days a year. The regulation appropriates a right to physically invade the growers’ property—to literally “take access,” as the regulation provides. Cal. Code Regs., tit. 8, §20900(e)(1)(C). It is therefore a per se physical taking under our precedents. Accordingly, the growers’ complaint states a claim for an uncompensated taking in violation of the Fifth and Fourteenth Amendments.
Slip op. at 10.
The Court next took down the Ninth Circuit's reasoning on that only "24/7" occupations are categorical takings. Permanent or temporary, what matters from a "common sense" point of view (see slip op. at 10) is that there's been an invasion, not its duration. The question of the duration of the invasion "bears only on the amount of compensation." Slip op. at 12. The Court clarified that (in)famous footnote in Loretto on which the Ninth Circuit relied, reemphasizing that the focus is on the invasion, not the duration or the size. Id.
Although the Court called this an "intuitive approach" (id. at 13), we suggest you read this part of the opinion in detail. There's a lot there, especially for property advocates. It's an ode -- or maybe even a love letter (hence the title, and the video above) -- to the right to exclude, and its role as a (maybe the?) central stick in the bundle of sticks.
"Keep out" indeed!
Next, in Part II, we'll take a look at how the Court treated our old friend, the Pruneyard case, and how the majority dealt with that case's holding that the California Supreme Court's rule that shopping center owners must allow use of their properties as forums for public speech was not a judicial taking.
Stay tuned.
Cedar Point Nursery v. Hassid, No. 20-107 (U.S. June 23, 2021)