If everything the Ninth Circuit says in its unpublished memorandum opinion in Craneveyor Corp. v. City of Rancho Cucamonga, No. 22-55435 (Apr. 20, 2023) is accurate, there's no way to ever draft a complaint alleging a facial Penn Central regulatory taking that will survive a 12(b)(6) motion to dismiss for failure to state a claim.
From what we can gather (this is an unpublished memorandum opinion, after all), the property owner asserted a facial takings challenge to some sort of zoning regulations that restrict its use of two parcels it owns. We're not sure what restrictions. See slip op. at 2 ("The complaint asserts a facial takings challenge under 42 U.S.C. § 1983 to a city zoning plan that allegedly restricts development on two parcels of land owned by CraneVeyor.").
Two theories: Lucas and Penn Central.
The court made short work on the facial Lucas claim, concluding that because the owner "acknowledges that the [zoning], on its face, does not prohibit all development in fault zones[, that] ... CraneVeyor has not stated a claim for a facial Lucas taking." Slip op. at 3.
The facial Penn Central claim fared no better. The court assumed without deciding that a property owner may assert a facial Penn Central claim, and proceeded to analyze the three Penn Central factors:
- Economic impact. "[I]nsufficient." Slip op. at 3. Why? Because "[v]aluable uses remain on CraneVeyor's land. According to the city, CraneVeyor could build up to two residential units on its first parcel. And the [zoning] ppermits livestock and poultry keeping on the second parcel." First, what does the (alleged) existence of "valuable uses" vel non remaining on the property have to do with whether the complaint is properly pleaded? This isn't a Lucas theory, which requires some kind of near-wipeout of economically beneficial uses; this this is Penn Central where there's no minimum threshold of economic loss, and even having a lot of "valuable uses" remaining in the after condition might be overcome by significant proof of the other two factors. Second, this was an appeal from a 12(b)(6) dismissal, yet (a) the court takes the city's word that there are other valuable uses remaining, and (b) the court apparently makes some kind of conclusion that the complaint didn't adequately allege the remaining uses are insufficient. So, Ninth Circuit, what percentage is sufficient that we have to plead? Your guess is as good as ours.
- Distinct investment-backed expectations. Nope. No landowner can reasonably expect to be free of zoning. And the owner didn't chase vesting, so there's that.
- Character. This is a regulatory taking, not a physical invasion. And zoning laws ain't facially takings.
Can all this be explained by the fact that the court was dealing with a facial Penn Central claim? Your guess is as good as ours. But if that's the case, wouldn't it just be easier to simply say there's no way to plead a facial claim for an "ad hoc" test, rather than potentially screw up the doctrine when down the road, someone inevitably tries to apply the court's analysis to a complaint asserting an as-applied Penn Central claim?
Craneveyor Corp. v. City of Rancho Cucamonga, No. 22-55435 (9th Cir. Apr. 20, 2023) (mem.)