“The Fifth Amendment’s Takings Clause provides essential protection to property owners by requiring the government to pay ‘just compensation’ whenever government regulations deprive property of all value.  But a recent appeals court decision eviscerates those protections by narrowly defining the circumstances under which compensation is payable.”
—Richard Samp, WLF Chief Counsel

WASHINGTON, DC—The Washington Legal Foundation (WLF) late Friday urged the U.S. Supreme Court to review (and ultimately overturn) a Federal Circuit ruling that undermines the ability of property owners to obtain compensation from the federal government when regulations deprive their property of economic value. In an amicus curiae brief in filed in Love Terminal Partners, L.P. v. United States, WLF argues that the appeals court decision bars compensation under the Fifth Amendment’s Takings Clause in the many cases in which the regulated property’s precise value is disputed.  WLF brief was joined by the Allied Educational Foundation.

The Plaintiffs were owners of an air-passenger terminal at Love Field, the airport closest to downtown Dallas. They spent more than $50 million between 1999 and 2006 to construct and maintain the terminal. The City of Fort Worth sought to prevent expansion of Love Field, fearing that it might harm the rival Dallas-Fort Worth Airport, which is located halfway between the two cities. So Fort Worth persuaded Congress in 2006 to pass a law that imposed limits on the number of gates at Love Field and that prohibited use of the Plaintiff’s terminal. That prohibition rendered the Plaintiffs’ terminal worthless.

The U.S. Supreme Court ruled in its 1992 Lucas decision that the Takings Clause always requires compensation when government regulation deprives an owner of all “economically viable use of his land.”  But the Federal Circuit (which hears appeals in all Takings Clause cases filed against the United States) ruled that Lucas is inapplicable when (as here) it is not 100% certain that the owner could have operated its business profitably even in the absence of the new government regulation.  In its brief urging Supreme Court review, WLF argues that the appeals court decision directly conflicts with Lucas and will make it very difficult for property owners ever to obtain “just compensation” for confiscatory government regulations.

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