Panel Activity

Recently the Federal Circuit issued its opinion in Caquelin v. United States, a case we have been tracking because it attracted three amicus briefs. In the opinion, a Federal Circuit panel including Judges Prost, Linn, and Taranto unanimously affirmed a lower court’s ruling that a Notice of Interim Trail Use (NITU) amounted to a taking of private property. Here is a summary of the opinion.

As explained in our argument preview, Caquelin contends that a taking occurred because the NITU amounted to a government-authorized physical occupation of the underlying property. Arguing against that claim, the government maintains that the NITU did not create a new easement, did not expand an easement, nor did it permanently prevent the owner from “regaining the unencumbered fee.” This case reached the Federal Circuit following a judgment in favor of Caquelin. The Court of Federal Claims found a taking to have occurred. As mentioned, three amicus briefs were filed, with support for both parties.

Judge Taranto wrote the opinion for the panel, which affirmed the Court of Federal Claims. In the introduction of the opinion, the court described the relevant facts:

Norma Caquelin owns land that was subject to a railroad-held easement limited to railroad use. The railroad applied to the federal Surface Transportation Board for permission to abandon its rail line, noting that it had run no traffic over the line for two years. Shortly thereafter, the Board granted the permission to abandon, to take effect a month later, unless, as relevant here, the federal-law process for considering use of the easement land for a public recreational trail was duly invoked. That process was invoked, and two days before the abandonment permission was otherwise to take effect, the Board issued a Notice of Interim Trail Use or Abandonment (NITU). The NITU prevented effectuation of the abandonment-authority approval and thus blocked abandonment—and, as a result, blocked the ending of the railroad’s easement, for which abandonment was a necessary condition—for 180 days, during which the railroad could negotiate to try to reach an agreement with two entities that expressed interest in a transfer of the easement for trail use. The NITU expired on the 180th day when no such agreement was reached. The railroad completed its abandonment three months later.

The government presented two issues: (1) whether the Court of Federal Claims erred in holding that a NITU “amounted to a government-authorized physical occupation of the underlying property for purposes of [a] takings analysis;” and (2) whether the Court of Federal Claims erred in finding a taking under the “multifactor analysis of Arkansas Game [and Fish Comm’n v. United States].”

The court rejected both of the government’s positions:

We affirm. We reject the contention that [the Supreme Court’s decision in] Arkansas Game calls for displacing the categorical-taking analysis adopted in our precedents for a NITU that blocks termination of an easement, an analysis applicable even when that NITU expires without a trail use agreement that would indefinitely extend the federal-law blocking of the easement’s termination.

The court began its analysis by explaining precisely the situation at issue in this case. In this case “the NITU, which expired without a trail agreement . . . , mandated continuation of the [preexisting] easement for a shorter period, providing a right of occupation by someone other than the landowner and, the trial court found, barring the landowner from using the ground burdened by the easement.” According to the Federal Circuit’s precedent, “this federal-law maintenance of an easement is a categorical, though temporary, taking, because, for takings-law purposes, it is relevantly the same in character as the longer-duration coerced continuation of an easement that a NITU effects when a trail conversion takes place.”

While the government argued Supreme Court precedent effectively overruled Federal Circuit precedent on point, the court disagreed. For example, it explained that its precedent “has not been undermined by Arkansas Game in favor of a non-categorical approach.” The court highlighted that the situation in Arkansas Game involved temporary government-induced flooding, and anyway “the Court did not call for a non-categorical approach” to the “narrowly defined situation” of this case. In Arkansas Game, the Court “reversed a ruling of this court that temporary government-induced flooding could not be a taking.” That case, the court emphasized, involved a rejection of “a categorical exemption from Taking Clause liability.” Anyway, that case, the court explained, “did not involve government action to maintain a recognized formal legal interest in land (an easement) that limited the landowner’s interests, much less an action taken only to buy time to try to arrange a categorical taking.”

Interestingly, the court went on to address the government’s argument “that a taking should not be found to have occurred during the period a NITU is in effect if, even in the absence of the NITU, the railroad would not have abandoned its rail line during that period.” Notably, the court found the government “simply asserts that there was no evidence that the railroad would have abandoned its line during that 180-day period had there been no NITU.” The government did “not seek a remand for findings on when the railroad would have abandoned its line had there been no NITU.” In this situation, the court ended up agreeing “with the government’s legal point but not its assertion of evidentiary insufficiency.”

On the legal point, the court agreed that it is “a fundamental principle of takings law that a government action is not a taking of property if, even in the absence of the challenged government action, the plaintiff would not have possessed the allegedly taken property interest.” The court also agreed that “[i]is undisputed that, without abandonment by the railroad, the easement would remain.” As a result, “the NITU would not have altered the continuation of the easement during the NITU period—i.e., would not have caused the only alleged taking of property—if the railroad would not have abandoned the rail line during that period even in the absence of the NITU.”

The court, however, rejected the government’s suggestion “that there is insufficient evidence to support a finding that the railroad would not [sic] have abandoned the line at issue between July 3, 2013 and December 30, 2013, even if no NITU had issued.” The court pointed out that “[t]he government does not point to any evidence at all affirmatively indicating that the railroad would have delayed abandonment past December 30, 2013, had there been no NITU to interfere with the grant of authority of abandonment that was set to take effect on July 5, 2013.” As a result, the court found no clear error “in a contrary finding on the evidence of record in this case.” Moreover, after reviewing the evidence in the record, the court held that the “evidence suffices to support an inference that, had there been no NITU, the railroad would have completed abandonment during the period in which the NITU was in effect.”

As a result of its analysis, the Federal Circuit affirmed the holding of the Court of Federal Claims that a taking occurred.