NFIB: Government Has No Right to Take Property for Anticompetitive Purposes

Date: July 10, 2017

Government agencies have no right to take your property for anticompetitive purposes. That’s according to the National Federation of Independent Business’ Small Business Legal Center, which has led a coalition of business groups in filing an amicus brief with the Louisiana Supreme Court in the case of Violet Dock v. St. Bernard Parish Port Authority

The case calls into question the port authority’s decision to use its power of eminent domain to seize Violet Dock Port’s facilities and allow a rival business to operate them—a decision that stood to benefit the port authority financially. 

“This was an outrageous abuse of power,” said Karen Harned, executive director of the NFIB Small Business Legal Center. “It’s one thing for a government entity to take someone’s property for a public project like a road or a school, but seizing someone’s business so someone else can have it is just wrong—and all the more offensive here given that the government is using eminent domain in a blatantly anticompetitive manner.” 

The port authority said taking Violet Dock’s facilities by eminent domain advanced the public interest by creating jobs and generating tax revenue, but, in its brief, the business groups said the authority was acting as an anticompetitive market-participant.  

“There is nothing public-minded about destroying a private-sector business for the benefit of a public enterprise,” Harned said. 

The NFIB-led coalition maintains that the elimination of private competition is not a legitimate public use. “The port authority can’t claim that it’s acting in the public interest when it’s placed its own interests above those of taxpayers, including small and independent businesses,” Harned said. 

“We believe this is a very important case that could potentially impact any small-business property owner in the state,” Harned said. “This case only underscores Justice O’Connor’s concerns in her strong dissent to the controversial Kelo v. New London decision, wherein she warned that the Supreme Court had opened the door to this sort of eminent domain abuse, such that any mom-and-pop business might be replaced by a Ritz Carlton. 

“This taking, however, goes beyond even what the infamous Kelo decision allowed when it said the government could take private property for economic redevelopment projects benefiting private developers,” Harned said. “Such abuse cannot be allowed to stand.” 

The NFIB Small Business Legal Center is the voice for small business in the nation’s courts and the legal resource for small-business owners nationwide. To learn more, visit www.NFIB.com/legal and follow @NFIBLegal on Twitter. 

Related Content: News | Legal | Louisiana | Property Rights

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