Petition for Writ of Certiorari — Mike Finnin Motors, Inc., et al., Petitioners v. United States, et al.

Supreme Court briefAug 11, 2021

Ask Donna

What actually matters in this document.

Text

NO. 21-_____

In the

Supreme Court of the United States

MIKE FINNIN MOTORS, INC., AND

GUETTERMAN MOTORS, INC.,

UNITED STATES,

__________________________

On Petition for a Writ of Certiorari to the

United States Court of Appeals for the Federal Circuit

PETITION FOR A WRIT OF CERTIORARI

RICHARD FAULKNER

12770 COIT RD., SUITE 720

DALLAS, TX 75251

(972) 972-1500

HARRY W. ZANVILLE

10740 EL MARBEA LANE

LA MESA, CA 91941

(619) 400-7164

HWZLAW@GMAIL.COM

JAMES H. ARENSON

ARENSON LAW GROUP, P.C.

425 2ND ST., SE #900

CEDAR RAPIDS, IA 52401

(319) 220-5850

AUGUST 11, 2021

SUPREME COURT PRESS

(888) 958-5705

BOSTON, MASSACHUSETTS

QUESTIONS PRESENTED

During the liquidity crisis of 2008-09, the United

States determined the public interest required

Chrysler and General Motors because they were

too important to fail. Believing each would be more

profitable with fewer dealers, the Government

restructuring plans required the confiscation of large

numbers of General Motors and Chrysler dealer franchises.

branded

vehicles, parts, and service in exclusive territories

were terminated and gifted to other dealers who the

Government assumed would operate more productively, thereby benefitting the public. Believing state

laws prohibited those dealership terminations without

compensation, the Government executed a bankruptcy

strategy to circumvent paying for the dealerships

being taken while concomitantly blocking dealers from

purchasing each other in the free market. The Court

of Federal

compensated

property seizure on two grounds: that the Chrysler

less because

their franchise contracts would have been rejected in

bankruptcy if the Government had not intervened

during the liquidity crisis and that the Government

was not legally responsible for the actions of Chrysler.

The Federal Circuit affirmed the former and declined

to address the latter.

THE CENTRAL QUESTIONS PRESENTED ARE:

1. Whether the novel Federal

defense to takings liability conflicts with

, 568 U.S. 23 (2012)

(categorical defenses are barred in takings cases),

, 576 U.S. 351 (2015) (hypothetical anal-

ysis is not permitted to bar takings liability),

, 438 U.S. 104

(1978) (

balancing factors are required in regulatory takings cases), and

, 535 U.S. 302 (2002)

(regulatory takings requirements may not be imported

into direct takings cases), as reiterated in

, 210 L.Ed.2d 369 (2021)?

2. Whether the dismissal of the direct takings

claims that were not even defended by the Government

on a ground it never raised departs so far from the

accepted and usual course of judicial proceedings

that the exercise

visory power is

justified because it contradicts the controlling precedents of

140 S.Ct.

1575 (2020) (party presentation rule),

, 547 U.S. 198 (2006) (entitlement to be heard

before a court rules upon

defenses it injected

for the Government), and

, 137 S.Ct.

1933 (2017) (fairness is required in takings cases)?

3. Whether the affirmance of the economic valuation decisions conflicts with the holding of

, 139 S.Ct.

1652 (2019) (franchisee rights are not rendered worthless by rejection in bankruptcy) and

, 338 U.S. 1 (1949) (proof of fair

market value is not required in cases of economic emergency)?

iii

PARTIES TO THE PROCEEDINGS

Petitioners and Appellants,

Representative Plaintiffs Below

Mike Finnin Motors, Inc.

Guetterman Motors, Inc.

Respondent

United States

Respondents and Co-Appellants,

Representative Plaintiffs Below

Taylor & Sons, Inc.

Cedric

, Inc.

RFJS Company, LLC

Jim Marsh American Corp.

Livonia Chrysler Jeep, Inc.

Barry Dodge, Inc.

RULE 29.6 STATEMENT

Neither petitioner is a publicly held company,

and no publicly held company owns 10% or more of

petitioner

LIST OF PROCEEDINGS

United States Court of Appeals for the Federal Circuit

No. 2020-1185, 2020-1205

Date of Final Opinion: December 29, 2020

Date of Rehearing Denial: March 17, 2021

_________________

United States Court of Appeals for the Federal Circuit

No. 2013-5019 and 2013-5020

Date of Final Opinion: April 7, 2014

_________________

United States Court of Federal Claims

No. 10-647C, 11-100C, and 12-900C

Date of Trial Opinion: October 12, 2019

TABLE OF CONTENTS

Page

QUESTIONS PRESENTED ........................................ i

PARTIES TO THE PROCEEDINGS ........................ iii

RULE 29.6 STATEMENT ......................................... iv

LIST OF PROCEEDINGS .......................................... v

TABLE OF AUTHORITIES ....................................... x

OPINIONS BELOW ................................................... 1

JURISDICTION .......................................................... 1

CONSTITUTIONAL AND

STATUTORY PROVISIONS INVOLVED .......... 2

STATEMENT OF THE CASE .................................... 3

REASONS FOR GRANTING THE PETITION ......... 9

THE FEDERAL CIRCUIT S

UT FOR TEST

SHOULD BE REVIEWED UNDER SUPREME

COURT RULE 10(A) AND 10(C) BECAUSE IT IS

CONTRARY TO CONTROLLING DECISIONS OF

THIS COURT ....................................................... 9

A. Relevant Takings Clause Concepts in

Context ........................................................ 9

B. The Dismissal of the

Takings

Claim for Failing to Satisfy an Element

of a

Takings Case Is Contrary

and

............. 11

Dismiss the Direct and the Regulatory

Takings Claims Is Contrary to Controlling

Decisions of This Court............................. 13

vii

TABLE OF CONTENTS

Continued

Page

II. THE METHODS USED TO DISMISS THE

DIRECT TAKINGS CLAIMS CONTRADICT THIS

COURT S CONTROLLING PRECEDENTS AND

DEPART SO FAR FROM THE ACCEPTED AND

USUAL COURSE OF JUDICIAL PROCEEDINGS

THAT THE EXERCISE OF THE COURT S SUPERVISORY POWER IS JUSTIFIED ............................ 22

A. The Government Did Not Defend the

Direct Takings Claim ............................... 22

Interjection

of a Direct Takings Defense for the

Government Violated Four Core Tenets

of the Administration of Justice ................. 25

III. THE RULING THAT DEALERS PROPERTY

W AS W ORTHLESS IN A HYPOTHETICAL

BANKRUPTCY W ORLD IS CONTRARY TO

CONTROLLING PRECEDENTS OF THIS COURT ..... 28

A. The Affirmance That Rejection Would

Render

Is Contrary to

................ 28

B. The Affirmance of Requiring Proof of

Fair

338 U.S. 1 (1949) and

............. 31

Make Historical and Subsidiary Fact

Findings Concerning the Profitability of

the Exercise of Franchisee Rights After

Rejection is Contrary to

., 333 U.S. 364

(1948) and

viii

TABLE OF CONTENTS

Continued

Page

., 138 S.Ct.

960 (2018) .................................................. 32

IV. TRADITIONAL CONSIDERATIONS SUPPORT THE

ISSUANCE OF A WRIT OF CERTIORARI ............... 35

A. The Petition Does Not Request Mere

Correction of a Legal Error ....................... 35

But F

Side-Stepping of Controlling Precedents

Will Have a Significant Impact Beyond

the Decision ............................................... 37

C. This Case Provides a Unique Opportunity

to Answer the Questions Presented

Here and to End the Result-Oriented

Reasoning Used by the Federal Circuit

Precedents ................................................. 39

CONCLUSION.......................................................... 41

TABLE OF CONTENTS

Continued

Page

APPENDIX TABLE OF CONTENTS

OPINIONS AND ORDERS

Opinion of the United States Court of Appeals for

the Federal Circuit (December 29, 2020) .......... 1a

Trial Opinion of the United States Court of

Federal Claims (October 12, 2019) .................. 12a

Opinion of the United States Court of Appeals for

the Federal Circuit (April 7, 2014) ................ 218a

REHEARING ORDER

Order of the United States Court of Appeals for

the Federal Circuit Denying Petitions for

Rehearing En Banc (March 17, 2021) ........... 250a

category

from, the issue of causa

1380, 1383 (Fed. Cir. 2020)

novel quasi-valuation

distinct

, 961 F.3d

eral

takings decision as exclusive authority for

taking claim ( . at 1150).

denial

The liability issue in a

takings case is

whether Government

restricting the use of private property.

, 260 U.S. 393, 415 (1922). Measuring

whether Government regulation

balancing of many factors, one of which with

the [government action] on the claimant

, 438 U.S. 104, 124 (1978).

The liability question in a

takings case is

simple: did the Government take the property? Proof

Governmental action is

irrelevant to direct takings cases and not required.

In doing so, the panel disregarded the law holding

it is improper to graft

taking elements

into the

takings cases rescued the Government

from liability.

Direct and the Regulatory Takings Claims Is

Contrary to Controlling Decisions of This Court.

of a Footnote in

, 538 U.S. 216 (2003).

is based on a misreading

of footnote 11 in

at 240.

footnote

did not announce a new liability barrier: it merely

stated a method of calculation of compensation being

used in an unusual set of factual circumstances. .

predecessor

, 449 U.S. 155, 164 (1980), was expressly

circumstance because the

challenged government program created income where

the client under any set of circumstance

. Like

should be limited to its unique facts.

The state government program there also could not

generate net income without violating its rules. Thus,

consequence of . . . incorrect private decision

compensation due . . . for any taking of their property

. Thus, unlike

was shaped

by the ordinary

considerations common to

properly decided takings cases.

footnote, relied upon by the Federal

addressed Government actions that create property value as an act

of genesis not as acts impacting property that

already had obvious value. 18

, Christopher

Serkin,

37 IND. L. REV. 417 (2004); Ross Saxer,

68 U. KAN. L. REV. 413 (2020). Thus, in

this regard,

. Benjamin H. Barton,

59 ALA. L. REV. 453, 482 (2008).

The Federal Circuit, having expanded

footnote into a rigid categorical test for

takings, here applied it as a liability barrier to the

takings claim (not as a compensation issue as

18 That the dealerships had obvious value is not contestable:

the Government believed it was nearly $1.5 billion.

by this Court or an

Federal Circuit.

by carving out a categorical exception to

Takings Clause liability and conflicts with

by obviating the requirement

to balance the

factors.

The panel affirmed the dismissal of the direct and

test. It is reversible error to use a categorical test to

bar

because it acts as a blanket exclusionary rule.

at 24, this Court unanimously

reversed the Federal

exemption

of direct takings liability for Governmental temporary

flooding impacting private property. This Court

circumstances of

at 39.

Similarly, in the context of regulatory takings,

is the converse of the requirement to balance

factors. Because

regulatory takings jurisprudence . . .

the use of categorical rules is prohibited.

1943. Instead, federal courts always are required

. 19

Proof that this was categorical is that the panel

ignored significant

balancing factors including:

at 124, partially listed those factors.

harm can be avoided through measures taken

by the claimant and the Government . . .

at 1031 (1992).

the fact that the taking was gratuitous (in

stark contrast to the doctrine of necessity

and the requirement of proportionality),20

for takings to benefit the public under the

official Government

the fact that the economic losses suffered by

terminated dealers like Petitioners were

disproportionate.

Categorical tests are only permitted to establish

takings liability, not deny

Government

physically takes possession of an interest in property

for some public purpose, it has a categorical duty to

compensate

at 322;

intervention,

the Federal Circuit will continue to create and impose

judicial thumb [is] firmly

on the Government

scales in takings cases. Gideon Kanner & Michael

Berger,

, 50 URBAN LAWYER 1, 34 n.140 (2019).

20 Permitting such gratuitous takings sidesteps the protective

cautions devel

1029, fn.

16 (1992);

, 101 U.S. 16, 18-19 (1880).

but

Prohibition on Hypothetical Takings

Analysis.

,21 the Government denied liability

on the ground that plaintiffs failed to prove the

Government ensuring the existence of

the raisin market. It urged this Court to adopt its

if a taking occurred, there is no constitutional violationand no remedy required

, 2015 U.S. S.Ct. Brief LEXIS 1254,

*89. The Government

appropriate

to consider what value all of the raisins would have

had in the absence of the marketing order

. In

other words, the Government demanded that property

owners be required to prove as fact a conjecture of

what would have happened if the Government did

nothing.

Chief Justice Roberts, writing for the majority,

rejected the Government

Government cites no support for its

hypotheticalcompensation

at 368.

Astonishingly, the panel adopted the losing argument in

The panel solely relied on a circular reference to

test. It was breathtaking that the panel lodged its

was decided after

decision of an unbriefed,

question of first

impression22 in a footnote and then designated it as

non-precedential.

but

test created an unworkable

standard contrary to the controlling decision

, 502

U.S. 491 (1992).

130,

limits

the

Government

property owner complains. Petitioners pinpointed that

particular Governmental action in the CFC:

Government took an action by which it compelled

Chrysler to terminate a subset of its dealers. It is the

Government

The CFC

responded by saying:

correct

But the Federal Circuit panels misstated the

Government

complained and substituted their own definitions for

that of the dealers. The panel contextual references

Government

Government intervention

Government

requirement

is an unworkable standard given the wide variety of

potential actions. These ambiguous substituted terms

could have meant many of the following: Government

financial assistance only to Chrysler after the bridge

loan, or before the bridge loan, or reaching back to

both GM and Chrysler, or to the entirety of financial

raised during oral argument.

intervention to auto financing, parts suppliers, states,

tax breaks, energy subsidies, and a myriad of other

federal interventions to restore liquidity. Federal

intervention included,

, Cash for Clunkers,

massive vehicle pre-purchasing, supplier guarantees,

and the $17 billion bail-out of GMAC which specifically

enabled the Government to participate in choosing

which Chrysler dealers to terminate.

The CFC agreed

Government action was ambiguous but failed to

. This formulation

creates a heuristic morass and conflicts with the requirement of workable standards for legal tests.

at 504.

Carefully Developed Mosaic of Cases

Instructing How to Value Property

Taken During Economic Emergencies

into a License to Seize Valuable Property

Without Paying for It.

First, economic emergencies do not suspend the

Constitutional requirement of just compensation for

taking private property.

, 290 U.S. 398 (1933). Strikingly similar to

this case, the precedent of the

, 419 U.S. 102 (1974) is highly instructive.

transportation crisis [was]

precipitated when eight major railroads . . . entered

[bankruptcy] reorganization proceeding

at 108.

Those railroads would have failed without Government

intervention. Just as in 2008-09, the Government

intervened because the railroads were too important

to be allowed to fail. Just as in 2008-09, the Government

dissolved the operating companies, created a new

entity, and anointed non-Government corporations to

operate and own the new entity.

As in 2008-09, the Government knew the railroad

property was obviously valuable. It decided to pay for

the property it was taking but only equal to or less

than the Congressionally approved sum. That was

drastically different than here, where the Government

rolled the dice on the legality of its strategy to use

the bankruptcy code to immunize itself from liability

for the obvious value it placed on the Chrysler

dealerships: nearly $1.5 billion.

This Court granted certiorari to review the Congressional attempt to limit compensatory relief for

railroad creditors and held the Fifth Amendment

requires the Government to pay property owners for

property it takes, even during economic emergencies.

. at 126.23 Significantly, it rejected Government

insistence that valuation compensation be computed

on a hypothetical, speculative basis. . at 146-47.

decision relies upon a snapshot

of value taken in the peak of the liquidity crisis when

the

be satisfied (because in a national liquidity crisis

there are no buyers and sellers free from compulsion

of the circumstance

decision

flies in the face of controlling precedent expressly

23 Similarly, when the Government attempted to wipe out its

financial obligations to World War 1 military insurance policy

holders to save money during the Great Depression, this Court

held policy holders had the right to a Fifth Amendment remedy,

notwithstanding the economic emergency.

292 U.S. 571 (1934).

to normalize after economic emergencies and denies

permission for the Government to value its takings

at 538-39;

;

, 597 F.3d 1356, 1370 (Fed. Cir.

2010).

Third, the underlying purpose

test might be sound if it was needed to prevent

property owners from using the Takings Clause to

profit from a windfall at the expense of the public.

But it is not needed. This Court already has a

method of avoiding such windfalls the black letter

law doctrine of offsetting benefits.

at 137. The Federal Circuit knows that doctrine

well: it properly applied it to benefit the Government

, 503 F.3d 1266

(Fed. Cir. 2007) (

For reasons unknown, the Federal Circuit invented

a new, unnecessary and incorrect method to avoid

such windfalls when, eschewing the economic impact

of what Government actually did, it required the

dealers to prove the hypothetical economic impact of

what might have happened if the Government did

nothing.

of the Government

concern about what

might have happened in the hypothetical (not real)

world.

. And, as if that was not enough,

another consequence of

unfair and unlawful switching of the burden of proof

required by the offsetting benefits doctrine. The Government, not the dealers, was required to bear the

burden of proof to establish offsetting benefits to

plaintiff

667 F.3d 1239, 1245 (Fed. Cir. 2011).

Finnin and Guetterman dutifully followed the

law at trial by properly subtracting the value of the

offsetting benefit of the Government

reduction requirements (the specific Government action

they complained about); the Government having made

no proffer of evidence of offsetting benefits.

immunize Government from liability when taking

Governmental action. Simply put, it licenses the Government to opportunistically seize obviously valuable

property without paying for it during an economic

s imagination reels at the limitless

possibilities if this is to be the law.

II.

THE METHODS USED TO DISMISS THE DIRECT

TAKINGS CLAIMS CONTRADICT THIS COURT S

CONTROLLING PRECEDENTS AND DEPART SO FAR

FROM THE ACCEPTED AND USUAL COURSE OF

JUDICIAL PROCEEDINGS THAT THE EXERCISE OF THE

COURT S SUPERVISORY POWER IS JUSTIFIED.

A. The Government Did Not Defend the Direct

Takings Claim.

1. The direct takings claim was uncontested

at trial.

The factual basis of the direct takings case rests

on uncontested trial evidence

valuable core property right was their territorial

exclusivity of the Chrysler brand to sell vehicles and

related parts and services. Uncontradicted evidence

proved the Government required dealer terminations

resulting in the involuntary transfer of those rights

of exclusivity to itself, as the judicially admitted

controlling shareholder and24 beneficial owner of

Chrysler, which were transferred later to other dealers

for free.

The Government chose not to defend the direct

takings claim at trial.

The CFC, inexplicably, made no findings of fact nor

conclusions of law concerning the direct takings claim,

despite it having been proven by the preponderance

of the evidence (there being no contrary Government

evidence or argument).

The legal basis of the direct takings claim is the

principle that the Fifth Amendment protects the

commercial property right to exclude competition

through exclusive territoriality. This Court recently

fundamental element of the property right, falls within

this category of interests the Government cannot

take without compensation

382.

in the competitive advantage over others that [its

owner] Monsanto enjoys by virtue of its exclusive

24 App.265a. The Government had power over the disposition

of the Chrysler and GM transferred dealerships. The Consolidated Appropriation Act of 2010, § 747, PL 111-117, 123 Stat.

3220 (Dec. 16, 2009). It is self-evident that without that power,

the manufacturers could not have been required to return the

franchises to the original dealers.

rights.

1011 (1984).

, 467 U.S. 986,

Here, as in

, the Government

appropriate[d] for the enjoyment of third parties the

Government

has physically taken property for itself or someone

else

has

occurred, and

2. The direct takings claim was uncontested

on appeal.

The direct takings claim was a centerpiece of the

Finnin and Guetterman appellate briefs. The Government, again, chose not to defend this claim on

appeal, despite being granted extra time and an

increased word count. Nor did it offer an excuse for

its lack of response.

The Government

that an incontestable

case for compensation

categ

provide

deliberate

physically take private property.

, 2021 U.S. S.Ct. Briefs Lexis 11, No. 20107, Jan. 7, 2021.

Like its

arguments, it could not

ethically cite any background principles of state

property law justifying this Government-authorized

taking because it admitted state laws barred the

proposed terminations. .

Interjection of a

Direct Takings Defense for the Government

Violated Four Core Tenets of the Administration

of Justice.

1. The panel violated the principle of party

presentation.

Federal

frame

the issues for decision

, 140 S.Ct.

principle of party presentation

requirement is

fundamental to our adversarial system of adjudication

ter of

parties represented by competent counsel know what

is best for them and are responsible for advancing

the facts and argument

540 U.S. 375, 386 (2003)

particularly

true of counsel for the United States, the richest,

most powerful, and best represented litigant to appear

, 808 F.2d 1298,

1301 (8th Cir. 1987) (Arnold concurrence).

Only in narrow and extraordinary circumstances,

not present here, may an appellate court raise a

defense on its own initiative.

, 566

U.S. 463, 472 (2012)

federal court does not have

to depart from the principle of party

presentation

Writing for the Court, Justice Ginsberg emphasized

currence in

, which

ments of Government

at 1579.

intervention to rescue the Government

from liability on the direct takings claim was a

heavy-handed tipping of the scales of justice. Not

only does the judiciary need to be impartial: it needs

. at 890 (Roberts, C.J.,

dissent). By raising its novel defense for the Government,

, the panel abandoned its role as a

that a

fair trial in a fair tribunal is a basic requirement of due

., 556 U.S.

868, 876 (2009).

The party presentation rule prohibited the panel

from interposing a defense to benefit the Government,

much less creating one out of whole cloth.

2. The refusal of supplemental briefing

after the surprise injection of a novel

defense violated controlling precedent.

interposed by the court without opportunity to reply

in advance, was met by an unexplained refusal. It is

a court must accord the parties fair notice and an

opportunity

210.

The panel abused its discretion by failing to provide the dealers with fair notice of its intent to inject

a defense to benefit the Government and to permit

supplemental briefing before or after acting upon its

own initiative.

3. Controlling precedents forbid interposing

a waived or forfeited defense.

The Government either waived or forfeited any

ture is

the failure to make the timely assertion of a right

while waiver is the intentional relinquishment or

540 U.S. 443, 458, fn. 13 (2004). 470, fn. 4 (2012)

party forfeits the right to advance on appeal a nonjurisdictional claim, structural or otherwise, that he

501

U.S. 868, 894 (1991) (Scalia concurrence). Forfeiture

nicality and is essential to the

orderly administration

Miller, FEDERAL PRACTICE AND PROCEDURE § 2472, p.

455 (1971).

Federal courts are not permitted to decide cases

on arguments waived by a party. This Court used its

supervisory authority to reverse the Tenth Circuit

for abusing its discretion when it raised a defense

for the Government

court is not at liberty . . . to bypass, override, or excuse

deliberate waiver of a . . . defense.

at 466. It reversed the Ninth Circuit for abusing its

discretion when,

, it raised an outcomedeterminative issue not raised by the parties.

at 1579.

4. The decisions below are contrary to

controlling decisions mandating fairness

and justice in every takings case.

The panel decision conflicts with the fairness

cases.

, even the erroneous

, 364 U.S. 40,

49 (1960), if it compared the Government

(terminating dealers without compensation) to a

hypothetical Government decision not to act (what

proposal to allow dealers to purchase each other).

But it did not.

Government from liability. There was nothing fair or

just for the Federal Circuit to refuse to apply controlling

precedents.

III. THE RULING THAT DEALERS PROPERTY WAS

WORTHLESS IN A HYPOTHETICAL BANKRUPTCY

WORLD IS CONTRARY TO CONTROLLING PRECEDENTS

OF THIS COURT.

A. The Affirmance That Rejection Would Render

The CFC required the dealers to prove their

property had economic value in an imaginary world

where the Government did not intervene.25 The CFC

found the dealerships would be worthless in the

hypothetical world because two assumed events would

both occur: (1) Chrysler would declare bankruptcy,

agreements which, as a matter of law, would auto25 That required ignoring the law (the Govern

testimonial

admission it has the duty to intervene) and key facts (the Govern

sion that GM and Chrysler were too important to

fail).

worthless.26

establish

rights of franchisees or leave them worthless.

at 1659. Like the CFC, it conflated

with

, diametrically opposed concepts both

in substance and procedure controlling the survival

of franchisee rights in bankruptcy.

at 1663.

contract that leaves intact the rights of franchisees.

Rejection of an executory contract

rights that the contract previously

. at

1666. In contrast, the substantive effect of an

order is elimination of franchisee rights.

Government briefs and oral argument in

along with its legal manuals, painstakingly distinguish

the contract. . . . the terms of the contract still control

the relationship

Civil Resource

Manual,

, § 60. It

admitted that terminating franchisee rights would

Briefs,

at 42-43, and warned

extinguishing franchisee rights through rejection would

precedent . . . that . . . undermines the

...

2018 U.S. S.Ct. Oral argument, LEXIS Tr. 24:3-11

26 Petitioners contested being required to speculate what would

happen if the Government did not intervene and contested the

second assumption as a matter of law because a bankruptcy court

cannot reject franchise agreements where franchisee assistance

is needed to efficiently liquidate estate assets.

(Feb. 20, 2019). Furthermore, the Government represented to this Court that, procedurally, an

requires an adversary proceeding

blown federal

2018 U.S. S.Ct. Briefs LEXIS 4815 at 34, fn. 4.

The

error in

failing to distinguish between rejection and avoidance.

Furthermore,

and other controlling cases

hold that rejected franchise contracts still contain

property rights inhering in those franchise agreements.

As a matter of l

included a suite of rights inhering in the franchise

contract

precedents unambiguously

protect

contract.

, 447 U.S. 74, 82, fn.6 (1980);

323 U.S. 373, 378 (1945).

The Government never contested the definition

of those franchise rights, established as unrebutted

fact by industry experts and dealers, and virtually

identical to the list of continuing dealer activities

silent on the crucial fact that Government and dealer

witnesses agreed the dealers would have maintained

profitable service operations as Chrysler-branded

dealers for three to seven years.

, III.C,

The panel compounded its errors by affirming

inhering in the franchise agre

reliance on

, 959 F.3d 1081,

1087 (Fed Cir. 2020), affirming that the only property

the requirement

entire group of

rights inhering in

contract.

(emphasis added);

. That error

disregarded the wide range of valuable rights inhering

in the franchise agreements.

The

rejection of

valuations of their franchise agreements was based

on another two-step reasoning process:

on premises about how Chrysler or a bankruptcy

trustee would have treated the franchise agreements

in . . .

and that the expert opinion of Ted

Chrysler franchisees would remain in full force and

. It was wrong on both points because the

concept of rejection is entirely irrelevant. Under

, regardless

remained intact.

The Government

was to make no

comprehensive

briefing of the law showing that the worthlessness

conclusion was founded on fundamental legal error

concerning

law concerning rejection, it was not an ordinary

error:

cases to provide the Government with an escape to

Fifth Amendment liability.

B. The Affirmance of Requiring Proof of Fair

, 338 U.S. 1 (1949)

and

Private property is not rendered worthless just

because no marketplace for buying and selling business property exists at the height of a national crisis.

FMV

methodologies was contrary to

and

which

held that, where there is no market price due to

exigent circumstances and because fairness requires

avoidance of extreme outcomes and inflexible tests,

measure of compensation is the rental that probably

Historical and Subsidiary Fact Findings

Concerning the Profitability of the Exercise

of Franchisee Rights After Rejection is Contrary

333 U.S. 364 (1948) and

., 138

S.Ct. 960 (2018).

In disregarding

, the

CFC failed to discharge its duty to make proper

historical and subsidiary fact findings concerning the

uncontroverted evidence establishing that the dealers

rights even after a hypothetical Chrysler bankruptcy

rejection.

27 The affirmance discredited Stockto

ion for

including

income stream profits and

elements

arate from the franchise

in conflict

with

and

, 953 F.3d 1344 (Fed. Cir. 2020)

rental income, rather than fair market value, is the appropriate

measure of economic impact because that is what the Government actu

change in fair market value approach would not accurately

account for the fact that the Governmental action targeted their

ness con

. 1354.).

A prime example was the Government

admission that its analysis

disappearance need not completely destroy its dealers.

Most of the jobs and profits in a dealership come not

from sales of new cars but from service and used

cars. Both would be needed if Chrysler liquidated

(emphasis added).28

Reinforcing that admission, additional trial evidence proved the suite of franchisee rights enabled

the dealers who were not forced to be terminated to

continue profitable Chrysler-branded operation postliquidation. It was unrebutted that 31,000,000 Chrysler

vehicles would need service and parts, and that

franchisee rights would provide the post-bankruptcy

dealers with competitive advantages for service-related

work including branded dealers, branded training,

branded parts, branded service provider computer

diagnostic electronics and engine system codes,

Chrysler specialized tools, and goodwill of established

Chrysler locations like Finnin Motors and Guetterman

Motors, who had been operating in their communities

for decades.

Those continuing valuable franchisee advantages

were independent of Chrysler warranty payments.

Because customers would pay for services and parts

out of their pockets without Chrysler warranties,

Government and plaintiff witnesses agreed customerpay29 repairs would be profitable for three to four

years. The Government offered no defense for the

evidence that

28 App.263a.

the labor or parts for the repair.

warranties also would be available from private

sources. These failures to make findings conflict with

the controlling decisions in

at 966

and

at 395-96,

Also, in conflict with

the panel

affirmed erroneous conclusions that franchisee rights

to service millions of Chrysler vehicles were worthless

upon rejection and that Te

opinion

for the dealers was properly excluded for assuming

the Government would have continued to cover

Chrysler warranties after Chrysler liquidated in a

That affirmance was simply wrong. Stockton

presented separate valuation scenarios, one of which

expressly excluded Chrysler warranty payments. He

calculated value with and without assumption of

Chrysler warranties,30

Tellingly, no Government expert trial witness attacked

analysis.31

Finally, it was uncontroverted that the Government

territories

such as those of Finnin and Guetterman would be

more profitably operated by other franchisees. It acted

to take and transfer these rights despite knowing

that the ineffective Chrysler dealerships were purchased already by other dealers. The CFC made no

findings about these facts and the panel was oblivious

to cited, controlling law that the Government must

compensate prior owners when it takes property to

timony and exhibits painstakingly

differentiated warranty from non-warranty assumptions.

divert it to other uses it decides would be more

productive, provide a political advantage to the

current administration, or benefit society as a whole.

, 282 U.S.

399, 408 (1931).

IV. TRADITIONAL CONSIDERATIONS SUPPORT

ISSUANCE OF A WRIT OF CERTIORARI.

THE

A. The Petition Does Not Request Mere Correction

of a Legal Error.

Petitioners are not complaining about a few isolated errors of law: what occurred below was a wholesale

indifference to controlling precedents amplified by

blatant violation of the party presentation rule and

denial of the right to reply to a

defense

interjected to benefit the Government. Such indifference could only have been occasioned by result-oriented

reasoning.

Result-oriented reasoning is universally condemned as an improper judicial decision-making method.

, 140 S.Ct.

1308, 1331, fn. 14 (2020). It is the converse of the

universal belief that

must be principled, rational, and based upon reasoned

, 541 U.S. 267, 278

(2004). As a former federal appellate judge implored:

reject result-oriented decision-making and adhere

strictly to the ideal of principled decision-making, both

32 Douglas Lind,

WASH. U. JUR. REV. 213, 217-18 (2012); Richard A. Posner,

, 59 IND. L.J. 1, 8 (1983).

to defend constitutional liberties and to defend itself

against an institutional devaluation in the eyes of

1991 WIS. L. REV. 837, 840.33

result-oriented reasoning, clearly

-justifies-the-means

Robert G. Miller,

TEX. B.J. 916, 917 (2002), is unconstitutional because it is beyond debate that

Constitution . . . is concerned with means as well

at 383.

The exercise

Rule 10(a) supervisory

power is the only obstacle to the Federal

determined dismantling of the guarantees of the

Takings Clause.

is the most

recent but not the only case where this Court invoked

that power.

, 558 U.S.

183, 196 (2010);

, 482 U.S. 641, 645

(1987);

, 539

U.S. 69, 74 (2003);

, 574 U.S. 1104 (2015) (Alito, J.,

dissenting).

33 Federal Circuit judges themselves have openly criticized the

-oriented judicial

occurring in that circuit.

dissents of Judges Moore and

, 966 F.3d 1347, 1366 (Fed. Cir. 2020) and

967 F.3d 1285, 1305 (Fed. Cir. 2020) (patent cases).

but

-Stepping of

Controlling Precedents Will Have a Significant

Impact Beyond the Decision.

Will Unduly Expand the Immunization of

the Government from Takings Liability.

analyzed the abysmal state of Takings Clause juris34

prudence. Noting that only 1.6% of 1,700

claims were successful from 1992-2017, he cited legal

it invites unprincipled, subjective decision

dependent upon the decision-maker

. (emphasis

purposeful citation of that

concern about unprincipled decision-making enabling

outcomes dependent on the identity of the decisionmakers provides a frame of reference for focus on the

actual data directly related to it.

Additional federal court statistical data further

substantiates his concerns because it demonstrates

that:

, 505 U.S. 1003 (1992).

Where the decision-maker was the Supreme

Court, Takings Clause relief was granted to

35% of private property owners from 19792015.

, Robert Meltz,

Congressional Research Service, 7-5700, 97122 (July 20, 2015).35

In stark contrast, where the decision-maker

was the Federal Circuit, the claims of private

property owners were found sufficient to

justify monetary relief in only two of 81

takings case appeals from 2001-2020. App.

253a.

It is shocking that the Federal Circuit

affirmed only one of 16 CFC trial verdicts

entered in favor of private property owners

between 2001-2020. App.255a.

Review by this Court will help assure private

property owners that the judicial system is not rigged

in favor of the Government and ensure that the Fifth

Amendment

, Daniel R. Mandelker,

, 55 REAL

PROP., TRUST & ESTATE L.J. 69, 96-97 (Spring 2020); F. Patrick

Hubbard, Shawn Deery, Sally Peace, John Fougerousse,

14 DUKE ENVTL. L. & POL Y F. 121 (2003-04); Basil H. Mattingly,

, 36 WILLAMETTE L. REV. 695 (2000).

2. Review Is Necessary to Assure Fair

Hearing to the GM Dealers Whose Case

Awaits the Finality of the Chrysler

This case was filed more than 13 years ago by

the GM and Chrysler dealers. After three motions to

dismiss, one interlocutory appeal, and an unsuccessful

Government motion for summary judgment in the GM

side of the case, the CFC acceded to the Government

request and bifurcated the GM dealer claims. The

CFC order stopped all progress in the GM side of the

case until a final decision is issued in the Chrysler case.

In contrast to the Federal

granting interlocutory appeal to provide guidance to

issued its decision as non-precedential. That designation had the practical effect of denying guidance to the

claims.

Review by this Court is necessary to provide guidance in what surely will be another lengthy and

expensive case to prosecute and to provide prophylactic

avoidance of another appeal.

C. This Case Provides a Unique Opportunity to

Answer the Questions Presented Here and to

End the Result-Oriented Reasoning Used by

Controlling Precedents.

There are no aspects of this case which would

distract from the ability of this Court to direct the

Federal Circuit to enforce the Fifth Amendment by

following its precedents and to avoid even the

semblance of result-oriented decision making in takings

cases favoring the Government.

Granting review by issuing a writ of certiorari

will make less likely federal Takings Clause jurisrelation

of the Constitution.

, 512 U.S.

374, 392 (1994);

, 139 S.Ct. 2162,

2170 (2019);

;

, 594 U.S. ___ (2021).

CONCLUSION

Constitutional guarantees are only as effective

as the ability to vindicate them, Alexander Hamilton,

FEDERALIST No. 78 and 80 (1788)

supervision under Rule 10(a) is necessary to ensure enforcement of the Fifth Amendment s Takings Clause.

The petition should be granted for the reasons

stated above.

Respectfully submitted,

HARRY W. ZANVILLE

10740 EL MARBEA LANE

LA MESA, CA 91941

(619) 400-7164

HWZLAW@GMAIL.COM

RICHARD FAULKNER

12770 COIT RD., SUITE 720

DALLAS, TX 75251

(972) 427-1500

JAMES H. ARENSON

ARENSON LAW GROUP, P.C.

425 2ND ST., SE #900

CEDAR RAPIDS, IA 52401

(319) 220-5850

AUGUST 12, 2021

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.