In June 2018, the NFIB Small Business Legal Center joined an amicus brief with the Cato Institute and Professor Ilya Somin of the George Mason University Law School in Knick v. Township of Scott, No. 17-647. As we’ve explained in the past, the Knick case could impact property owners in a big way—especially in states where government officials (and possibly the courts) show hostility to property rights. The case concerns whether landowners can demand just compensation for a taking in federal court or whether they must litigate takings claims in state court?
The government can “take” private property either through eminent domain for public projects or through regulatory conduct. For example, the government might take land by imposing stringent regulation that bars all economically productive uses. Or government agents might take a portion of one’s land by assuming physical control. In Knick, local officials enacted an ordinance that authorized the public to enter private property—a measure that denied the owner’s right to exclude trespassers and unquestionably triggered a constitutional requirement for the government to pay just compensation under the Fifth Amendment. This should be a straightforward case. Yet the Township of Scott has argued that it cannot be sued in federal court.
Since the Supreme Court’s infamous 1986 decision in Williamson County Regional Planning Board v. Hamilton Bank, courts follow the nonsensical rule that property owners must first litigate a takings claim in state court before proceeding to federal court. In reality, the state court first rule precludes a landowner from ever proceeding to federal court because one cannot relitigate cases lost in state court. NFIB’s amicus brief urges the Supreme Court to abandon Williamson County’s wrongly decided state litigation rule.
Courts should not bar landowners from vindicating federally guaranteed constitutional property rights in federal court. In no other context do courts deny citizens the right to litigate federal constitutional claims in federal court. And there is simply no basis for applying special rules to shield governmental defendants in property rights disputes. Simply put, the federal courthouse doors should be open to small business landowners.
Ilya Somin offers additional insights at Volokh Conspiracy. Elsewhere, Cato Institute argues that its time for the Supreme Court to bury Williamson County’s “Kafkaesque” rule. And Robert Thomas provides further commentary at Inversecondemnation.com.