Fourth Circuit: NC town can’t deny forum for takings claim

In an opinion published last week by the U.S. Court of Appeals for the Fourth Circuit, Judge Shedd writes that a town being sued for a Fifth Amendment taking can’t avoid the suit by playing jurisdictional games.

In this case, homeowners were suing their town over various regulations and actions dealing with beach erosion; one of their claims was that the town was depriving them of the value of their land without just compensation, a “taking” under the Fifth Amendment. (The town is Nags Head, on the NC outer banks, nestled between the sites of the first heavier-than-air flight and the Lost Colony.)

The homeowners initially sued in state court. The town removed the case to federal court, and then asked to have the takings claim dismissed because it was unripe. Under existing Supreme Court precedent, takings claims must first be raised under state procedures for dealing with those claims before a federal court will deem those claims “ripe” for federal litigation. The federal district court dismissed the claims under this “state-litigation” requirement.

The appeals court, however, saw mischief here. The town itself took the case out of state court and into federal court, only to ask to have it dismissed because it should be in state court instead of federal court. The Supreme Court has ruled that similar manipulative litigation is not allowed when a state invokes Eleventh Amendment immunity. The situation here is analogous, the Fourth Circuit wrote. The town waived its opportunity to have a state forum when it removed the case from that forum.

The Fourth Circuit sends the case back to the district court to deal with the landowners’ Fifth Amendment takings claims.

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