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Interesting Post-Kelo Public Use Case:

An interesting and potentially important post-Kelo public use case is now before the U.S. Court of Appeals for the Fifth Circuit (hat tip to Wright Gore, President of the Western Seafood Co., who brought this case to my attention). In Western Seafood Co. v. City of Freeport, part of a property owner's lot is being condemned and transferred to a neighbor so that the latter can build a marina for the asserted purpose of promoting "economic development" in the area. In Kelo v. City of New London, the Supreme Court of course held that "economic development" is sufficient justification to allow condemnation of private property for transfer to a new private owner.

In one sense, Western Seafood is a less egregious example of eminent domain abuse than many previous cases. The planned condemnation will not displace dozens of people (as in Kelo) and certainly not thousands (as in the notorious Poletown case, and many "urban renewal" takings). However, to a greater extent than Kelo, Western Seafood seems to be a case where there is a pure "A to B" condemnation where most if not all the benefits flow to an identifiable private party.

In Kelo, the Supreme Court majority indicated that the lack of an identifiable private beneficiary was one factor in its decision to uphold the condemnation. In reality, the Kelo taking was to a large extent instigated by the Pfizer Corporation, but as I explain in my forthcoming article on Kelo (pp. 57-58), this was not fully understood until after the case was decided by the Supreme Court. Western Seafood will help determine how important this factor really is.

My own view is that this will be a difficult case for the property owner to win. The Freeport condemnation is part of a city development plan, albeit one that may be dubious in nature. The Kelo majority repeatedly emphasized that a condemnation undertaken as part of an "integrated development plan" is virtually immune from public use challenge. Courts are not supposed to "second guess" the planners, require them to prove that the condemnations are necessary to achieve the plan's goals, or even ask the government to demonstrate that the plan has any prospects for success (see my article, pp. 48-49, 56-57). While Justice Kennedy's concurring opinion is slightly less deferential to the government than Justice Stevens' opinion for the Court, Kennedy signed on to the majority opinion, so his own handiwork has no binding precedential significance for lower courts.

Nonetheless, the Western Seafood case will help delineate the outer limits of Kelo and therefore bears close watching. The case also raises public use issues under the Texas state constitution and under Texas' new post-Kelo eminent domain reform law. Unfortunately, the Texas law is quite weak, as I documented in my article linked above, because it continues to allow condemnations for "community development," which is defined broadly enough to encompass virtually any condemnation for "economic development."

Note: the link above is to a website run by the property owners and reflects their perspective on the case. However it also includes links to the City of Freeport's briefs, thereby enabling you to get their side of the story as well.

Rodger Lodger (mail):
It should be emphasized even for the knowledgeable readers of this site, that litigating the reach of Kelso -- a case which grants no power to governments -- is not the way to fight this kind of eminent domain. The battlefields are legislatures and executive branches.
6.1.2006 5:26pm
jv:
Greetings, I wonder, could be Kelo used also for "transfer" of dormant patents?
6.1.2006 5:33pm
Gordo:
In Illinois the SWIDA case from 2002, decided by the Illinois Supreme Court, went directly opposite Kelo, using both the United States Constitution and the Illinois Constitution as a basis. While the U.S. underpinning is gone because of Kelo, the Illiinois underpinning may remain.

But my Civil Procedure is a little rusty. Must the Federal Court of Appeals apply a State Constitution in the same way it applies a State Statute? Or is it proper for the Court to certify a question as to whether State Constitutional law differs from the Fifth Amendment on this issue to the Illinois Supreme Court?
6.1.2006 5:41pm
Bryan DB:
What's a "dormant" patent? For a patent to remain in force, maintenance fees must be paid, suggesting the inventor, or patent owner, has some interest in it and the patent is not truly dormant.

If, on the other hand, you're talking about forcing someone to license a patent that they're not using, there is conflicting Circuit precedent. Some circuits say a patent holder must license a "dormant" patent, and other circuits say the patent holder need not.
6.1.2006 5:48pm
Timothy (mail) (www):
I think if we just amended the fifth amendment to end with "nor shall any private property be taken," we'd be a lot better off.
6.1.2006 6:37pm
Tom Holsinger (mail):
Having litigated condemnation cases in private practice and evaluated them as a trial court research attorney, I feel that Kelo adequately created criteria for distinguishing between improper and proper takings. Those of us at the trial court level can examine administrative records in light of Kelo's criteria and make such calls.

I'm sure future appellate decisions will clarify the line here, but IMO it is feasible for us to implement Kelo right now. I tend to agree that non-public takings should be outright prohibited, but Kelo is acceptable from a purely mechanical viewpoint.
6.1.2006 7:09pm
Gordo:
Timothy - the problem with your amendment is that it would prevent traditional public projects such as roads that are necessary to go in a certain location from doing so if one private property owner out of 100 didn't agree to sell. This goes way beyond any of the arguments related to the Kelo case.
6.1.2006 7:31pm
Steve:
The holding that federal courts will not scrutinize development plans on a lot-by-lot basis, of course, predates Kelo by more than 50 years.
6.1.2006 8:13pm
Boulderlaw (mail) (www):
Why must a road “go in a certain location”? The only possible answer is economic efficiency (i.e., you can always pave the road around the mountain, its just cheaper to go through it). Thus the same rationale would apply to “economic development” takings that supposedly achieve the highest and best outcomes for the community. Necessity is not the issue.

The question at base (in Kelo and in takings generally) is whether we are comfortable subordinating the most basic rights of some to the will of the majority (or the politically connected). Certainly roads benefit a great number of people, maybe enough people that they are a “public” benefit, but beneficial results alone are not a sufficient basis for eliminating basic rights. Would you condone slavery if it were beneficial to most people? Conscription into the civil service? How can you at once condone taking someone’s land for a road, yet reject the idea of forcing someone to join the crew that will build the road?
6.1.2006 8:42pm
Gordo:
Boulderlaw: You have every right in the world to raise these points. My counterpoint is that there is a 218 year history of paying just compensation to private property owners for a taking of their property for a public use. Your argument goes way beyond mere "originalism" and into the fringes of libertarian fantasy.
6.1.2006 9:03pm
ziske68 (mail):
IMO the problem is that "public use" has been bastardized into "public benefit" and it is taken as fact that more tax revenue is a "public benefit". Those of us who are a bit more leary of government find that to be counterfactual at best.
6.2.2006 2:53pm
markm (mail):
'it is taken as fact that more tax revenue is a "public benefit".' There is the basic issue. According to that principle, citizens exist for the convenience of the state, which needs tax revenue. Didn't we fight a war over that 230 years ago?
6.2.2006 6:30pm
Peter Wimsey:
'it is taken as fact that more tax revenue is a "public benefit".' There is the basic issue. According to that principle, citizens exist for the convenience of the state, which needs tax revenue. Didn't we fight a war over that 230 years ago?


I seem to recall we did fight a war at about that time in which one issue was "no taxation without representation." Although taxation with representation was perfectly acceptable.
6.2.2006 7:10pm
Boulderlaw (mail) (www):
Gordo:

I prefer “idealism” to “fantasy,” although at this point there might not be a difference.
6.2.2006 10:29pm
biu (mail):
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6.3.2006 6:00am