Opinion analysis: Court overrules takings precedent, allowing more suits in federal court

In its long-awaited opinion in Knick v. Township of Scott, the Supreme Court ruled on Friday that plaintiffs alleging that local governments have violated the takings clause may proceed directly in federal court, rather than first litigating in state court. The opinion overrules a 34-year-old precedent, Williamson County Regional Planning Commission v. Hamilton Bank, triggering a sharp dissent and another debate among the justices about the meaning of stare decisis. The majority opinion also rests on a reading of the takings clause—that a constitutional violation occurs at the moment property is “taken,” even if compensation is paid later—that may have consequences beyond this case.

The takings clause of the federal Constitution provides: “nor shall private property be taken for public use, without just compensation.” This takings case arose from a dispute between petitioner Rose Mary Knick and the township of Scott, Pennsylvania. Knick has a small graveyard on her property, and the township attempted to enforce against her an ordinance requiring such properties to be open to the public during daytime hours. Knick alleged an unconstitutional taking, but a federal court dismissed her suit because she had not first sought compensation in state court.

That brings us to Williamson County. The court held there that the plaintiff could not bring a takings claim in federal court until the plaintiff had pursued an inverse-condemnation action—that is, a lawsuit seeking compensation for the alleged taking—in state court. The Williamson County court drew upon two principles from prior case law: first, that “because the Fifth Amendment proscribes takings without just compensation, no constitutional violation occurs until just compensation has been denied.” Second, the court invoked a line of cases, starting with Cherokee Nation v. Southern Kansas Railway Co. in 1890, for the proposition that governments need not pay compensation at the time of the property deprivation as long as, at that time, they make available a “reasonable, certain, and adequate” mechanism for recovering such compensation after the fact.

The Williamson County decision has generated substantial criticism, due primarily to its effects on local takings plaintiffs. For one, Williamson County’s acceptance of inverse-condemnation suits in state courts as a “reasonable, certain, and adequate” recovery mechanism, and the consequence that local takings plaintiffs must proceed first in state court, means that takings plaintiffs are differently situated from other constitutional plaintiffs, who can go straight to federal court. (Defenders of Williamson County argue this is because the takings clause is different from other constitutional rights—more on that shortly.) Perhaps more strikingly, application of the full faith and credit statute, as the court explained in San Remo Hotel v. City and County of San Francisco,  often means that local takings plaintiffs are barred from federal court altogether, a consequence that Williamson County did not foreshadow or perhaps even foresee.

The majority opinion in Knick, written by Chief Justice John Roberts on behalf of himself and Justices Clarence Thomas, Samuel Alito, Neil Gorsuch and Brett Kavanaugh, overrules Williamson County. The majority concludes that Williamson County’s “state-litigation requirement imposes an unjustifiable burden on takings plaintiffs” and “conflicts with the rest of our takings jurisprudence.” In reaching this conclusion, the Supreme Court does not rely on any of the narrow rationales described in my earlier posts about the case—including the U.S. solicitor general’s proposed interpretations of Sections 1983 and 1331, and Knick’s supplemental theory based on whether and when the government admits a taking has occurred. Rather, the majority rejects the proposition that the solicitor general (echoed now by the dissent) described as uncontested and over a century-old: that a taking does not occur at the time of the property deprivation so long as an adequate mechanism for compensation is available. Instead, the rule the court announces is that  “a government violates the Takings Clause when it takes property without compensation, and … a property owner may bring a Fifth Amendment claim under § 1983 at that time.”

The majority supports this rule in several ways. First, it briefly discusses the text of the takings clause: That text does not, the majority notes, state “Nor shall private property be taken for public use, without an available procedure that will result in compensation.” The majority roots its interpretation in precedent, specifically Jacobs v. United States and First English Evangelical Lutheran Church v. County of Los Angeles, both of which indicate that the right of compensation arises at the time of the taking. The majority also explains its point by analogy: “A bank robber might give the loot back, but he still robbed the bank.” In the same vein, subsequent payments of compensation remedy takings; such remedies do not mean there was no violation. The court also asserts that its holding is basically consistent with the Cherokee line of cases, most of which involved claims for injunctive relief. And it concludes that overruling Williamson County is compatible with principles of stare decisis, the rule that courts should generally adhere to precedent, given how wrong and unworkable the rule has proven to be and the absence of reliance on it. Finally, the majority offers some assurance in response to concerns expressed by the United States. The majority states that, even though its ruling deems many government actions unconstitutional even if compensation is later paid, it will not lead courts to bar those actions: “As long as just compensation remedies are available—as they have been for nearly 150 years—injunctive relief will be foreclosed.” (Elsewhere in the opinion the court states the assurance this way: “Given the availability of post-taking compensation, barring the government from acting will ordinarily not be appropriate.”)

In a brief concurrence, Thomas underscores his rejection of what he terms the “‘sue me’ approach to the Takings Clause”—the approach, advocated by the township and the United States but rejected by the majority, that deems there to be no constitutional violation as long as compensation is later paid. Critiquing concerns raised by the United States, Thomas writes that if the payment of compensation at the time of a taking “makes some regulatory programs ‘unworkable in practice,’… so be it—our role is to enforce the Takings Clause as written.” Perhaps most intriguingly, Thomas may be understood to cast some uncertainty on the majority’s indication that regulatory programs will not face new obstacles. He echoes the majority’s explanation that the United States’ concerns about injunctions “may be misplaced.” But he goes on to write: “I do not understand the Court’s opinion to foreclose the application of ordinary remedial principles to takings claims and related common-law tort claims, such as trespass.”

Justice Elena Kagan’s sharply worded dissent, joined by Justices Ruth Bader Ginsburg, Stephen Breyer and Sonia Sotomayor, takes the court to task for “smash[ing] a hundred-plus years of legal rulings to smithereens.” Kagan contests the notion that takings claims are treated worse than others under Williamson County (and rejects the bank robber analogy), noting that “[t]he distinctive aspects of litigating a takings claim merely reflect the distinctive aspects of the constitutional right,” which is not violated until “(1) the government takes property, and (2) it fails to pay just compensation.” She chides the majority for its textual analysis, noting that the spare text of the Fifth Amendment “no more states the majority’s rule than it does Williamson County’s.” The dissent emphasizes Williamson County’s long precedential pedigree, giving the majority “[p]oints for creativity,” but stating that the majority’s construction of the Cherokee line of cases is “just not what the decisions say” (and was not argued by Knick or her amici). “Maybe,” the dissent writes, “the majority should take the hint: When a theory requires declaring precedent after precedent after precedent wrong, that’s a sign the theory itself may be wrong.”

The dissenters point to three negative consequences of the majority’s ruling. First, “it will inevitably turn even well-meaning government officials into lawbreakers.” Now that a constitutional violation is complete at the time of deprivation, even if the government will later pay compensation, ordinary land-use regulators become “constitutional malefactors.” None of the opinions fully flesh out the possible consequences of that distinction—but local, state and federal officials (who take oaths to uphold the Constitution) will likely be reflecting on the possibility of collateral consequences. Second, the dissent asserts that federal courts will now be flooded with claims that depend on land-use and state-law intricacies, and that the majority’s ruling “betrays judicial federalism.” Finally, and perhaps most vigorously, the dissent decries the majority’s treatment of stare decisis. “[T]he entire idea of stare decisis is that judges do not get to reverse a decision just because they never liked it in the first instance,” the dissent writes, and “it is hard to overstate the value, in a country like ours, of stability in the law.” Referencing the court’s citation to last term’s controversial ruling in Janus v. American Federation of State, County, and Municipal Employees the dissent states, “If that is the way the majority means to proceed—relying on one subversion of stare decisis to support another—we may as well not have principles about precedents at all.”

To sum it up: The Knick opinion is a win for those who those who lamented the difficulty local takings plaintiffs faced in accessing federal courts. Local takings plaintiffs may now go directly to federal court, without first proceeding in state court. The theory the Supreme Court relies upon—that a constitutional violation is complete at the time property is taken, even if mechanisms are available to seek compensation—may have other implications for local, state and federal regulators, though the majority emphasizes that regulatory programs are unlikely to be invalidated or enjoined on the basis of today’s ruling. Finally, the opinion provides another round of debate within the court about the meaning of stare decisis, now and going forward.