Amicus Curiae Brief — Allied-General Nuclear Services v. United States, 109 S. Ct. 61 (1988) (No. 87-1902)

JUN 22 1588

No. 87-1902

banat we ie

eS

JOSEPH F. SPANIOL, “a

a

In The

Supreme Court of the United States

October Term, 1987

ft).

Vv

ALLIED-GENERAL NUCLEAR SERVICES, ALLIED

CHEMICAL NUCLEAR PRODUCTS, INC., and

VALLEY PINES ASSOCIATES,

Petitioners,

v.

UNITED STATES,

Respondent.

tf).

Vv

On Petition for Writ of Certiorari to the

United States Court of Appeals for the Federal Circuit

ay

vv

BRIEF AMICUS CURIAE OF PACIFIC LEGAL

FOUNDATION IN SUPPORT OF

PETITIONER, ALLIED-GENERAL NUCLEAR

SERVICES, ET AL.

ft).

Vv

Of Counsel RONALD A. ZUMBRUN

*EDWARD J. CONNOR, JR.

JOHN M. GROEN *COUNSEL OF RECORD

Pacific Legal Foundation Pacific Legal Foundation

555 Capitol Mall, Suite 350 555 Capitol Mall, Suite 350

Sacramento, California 95814 Sacramento, California 95814

Telephone: (916) 444-0154 Telephone: (916) 444-0154

Attorneys for Amicus Curiae

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

or call collect (402) 342-2831

TABLE OF CONTENTS

Page

TABLE OF AUTHORITIES CITED occ ii

INTEREST OF AMICUS CURIAE .ww 1

STATEMENT OF THE CASE . : nt 3

SUMMARY OF ARGUMENT UUW... 5

REASONS FOR GRANTING THE PETITION 6

I. THE COURT OF APPEALS’ DECISION

RECOGNIZING A POLICE POWER EXCEP-

TION TO THE TAKINGS ANALYSIS IS IN

DIRECT CONFLICT WITH SUPREME

COURT PRECEDENT AND ESTABLISHED

TAKINGS CLAUSE JURISPRUDENCE .W.))| 6

A. Regulatory Takings Jurisprudence ....................... 7

B. The Opinion Below Misconstrues Keystone

Coal and Is in Direct Conflict with United

States Supreme Court Precedent 0.000000... 11

Il. THIS COURT SHOULD NOW CLARIFY

WHETHER POLICE POWER ACTIONS FOR

HEALTH AND SAFETY PURPOSES ARE

INSULATED FROM REGULATORY TAK-

REPRE SOND Cece cee 13

CURRIN iit nsnies 17

il

TABLE OF AUTHORITIES CITED

Page

CasEs

Agins v. City of Tiburon, 447 U.S. 255

(1980) 9, 11, 12, 13, 15, 16

Barbian v. Panagis, 694 F.2d 476 (7th Cir. 1982) .... 11

California Reduction Co. v. Sanitary Reduction

Works, 199 U.S. 306 (1905) ae oe

Empire Kosher Poultry v. Hallowell, 816 F.2d 907

(3rd Cir. 1987) 15, 16

First English Evangelical Lutheran Church of

Glendale v. County of Los Angeles, 482 U.S. —,

96 L. Ed. 2d 250 (1987) 5, 12, 13, 14, 16

Hadacheck v. Sebastian, 239 U.S. 394 (1915) ow. 8

Herrington v. County of Sonoma, 834 F.2d 1488

(9th Cir. 1987) 15

Keystone Bituminous Coal Association v. DeBene-

dictis, 480 U.S. —, 94 L. Ed. 2d 472 (1987) passim

McClimans v. Board of Supervisors of Shenango

Township, 529 A.2d 562 (Pa. Commw. 1987) 15

Mugler v. Kansas, 123 U.S. 623 (1887) passim

Nollan v. California Coastal Commission, 483 U.S.

am, OF Le. Ed. 20 GTi (OR) 2. eee 5, 6,9, 10, 11, 13

Orion Corp. v. State, 109 Wash. 2d 621 (1987) 14

Penn Central Transportation Co. v. City of New

York, 438 U.S. 104 (1978) oe

Pennsylvania Coal Co. v. Mahon, 260 U.S. 393

CRIED ane siiciicnnia ccc passim

Wheeler v. City of Pleasant Grove, 833 F.2d 267

(ith Cic. 1967) .. eee 10

ill

TABLE OF AUTHORITIES CITED—Continued

Page

Unitep States Constitution

Amend. V, $1 3, 5, 7

MISCELLANEOUS

Bosselman, Callies, and Banta, The Takings Issue

_k, SEARGRNGL AACS Sap en 7

Epstein, Takings: Descent and Resurrection, Sup.

Ct. Rev. 1 (1987) a ‘i 16

Falik and Shimko, The ‘‘Takings’ ’Nexus—The

Supreme Court Chooses a New Direction in

Land-Use Planning: A View from California,

oo tiastmes 1.3. 359 (1988) 16

Peterson, Land Use Regulatory ‘‘Takings’’ Re-

visited: The New Supreme Court Approaches,

39 Hastings L.J. 335 (1988) ..... 16

vonLembke, Keystone Bituminous Coal Associa-

tion v. DeBenedictis and the Status of Coal in

Pennsylvania, 111 Harv. J.L. & Pub. Pol’y 227

cha ah scat oaterrasissicincininscne 16

No. 87-1902

In The

Supreme Court of the United States

October Term, 1987

—w

Vv

ALLIED-GENERAL NUCLEAR SERVICES, ALLIED

CHEMICAL NUCLEAR PRODUCTS, INC., and

VALLEY PINES ASSOCIATES,

Petitioners,

v.

UNITED STATES,

Respondent.

f).

Vv

On Petition for Writ of Certiorari to the

United States Court of Appeals for the Federal Circuit

fay

Vv

BRIEF AMICUS CURIAE OF PACIFIC LEGAL

FOUNDATION IN SUPPORT OF

PETITIONER, ALLIED-GENERAL NUCLEAR

SERVICES, ET AL.

ft).

Vv

INTEREST OF AMICUS CURIAE

Pursuant to Supreme Court Rule No. 36, Pacific Legal

Foundation (PLF) respectfully submits this brief amicus

curiae in support of the petitioners, Allied-General Nuclear

Services, et al. (Allied-General). Written consent to the

2

filing of this brief has been granted by counsel for all

parties. Copies have been lodged with the Clerk of the

Court.

PLF is a nonprofit, tax-exempt corporation organized

under the laws of the State of California for the purpose

of engaging in litigation in matters affecting the public

interest. Policy is set by a Board of Trustees composed of

concerned citizens, the majority of whom are attorneys.

PLF’s Board evaluates the merits of any contemplated

legal action and authorizes such legal action only where

the Foundation’s position has broad support within the

general community. PLI’s Board has authorized the fil-

ing of an amicus curiae brief in this matter.

Amicus seeks here to augment the argument in the

petition for writ of certiorari. It is believed that PLI'’s

publie policy perspective and litigation experience in sup-

port of private property rights will provide an additional |

viewpoint with respect to the constitutional issues pre-

sented. PLF has participated in numerous cases involving

issues arising under the Takings and Due Process Clauses

of the Fifth and Fourteenth Amendments to the United >

States Constitution.

The opinion below holds that governmental actions

which advance legitimate police power objectives are, for

this reason alone, insulated from Fifth Amendment taking

claims. Under this decision, it is diffieult, if not impos

sible, to imagine any situation involving a regulation de-

signed to achieve a governmental purpose which could be

said to constitute a taking. Amicus believes the ruling

below poses a serious threat to the integrity of private

property rights by violating the constitutional prohibition

avainst the taking of property without just compensation.

a Te me

STATEMENT OF THE CASE

This case involves important constitutional principles

relating to governmental powers and private property

rights. On one hand, the ‘‘police’’ or ‘‘regulatory’* power

enables government to secure and promote the public good.

However, regulation for the public good is often achieved

at great expense to individual property owners. The con-

stitution seeks to balance the competing public and private

interests by requiring payment of compensation whenever

the governmental action results in a taking.' The opinion

below ignores and undermines this constitutional balance.

Allied-General seeks compensation for the regulatory

taking of the Barnwell Nuclear Fuel Plant (Barnwell

Plant). The basis for the takings claim is that various

United States government ‘‘inducements’’ had encouraged

Allied-General to apply for a construction license from the

Nuclear Regulatory Commission (NRC) and spend ap-

proximately $200 million building the plant. The federal

government’s actions created reasonable investment-

backed expectations that a properly constructed plant

would be allowed to operate. These expectations were not

realized because the United States refused to grant an op-

erating license after construction was completed. Appar-

ently, President Carter believed that allowing operation of

the Barnwell Plant would be inconsistent with efforts to

control nuclear proliferation in other countries. Therefore,

from 1977 to 1981 a freeze on the processing of the Barn-

well operating license was in effect. Although the freeze

was lifted in 1981 by President Reagan, the NRC and the

. “INJor shall private property be taken for public use, with-

out just compensation.” U. S. Const. Amend. V, § 1.

Department of Energy have not revived consideration of

the operating license application. The plant continues to

sit idle with no potential economically viable use.’

The opinion below does not address the takings claim

by inquiring whether Allied-General has been subject to

undue interference with reasonable investment-backed ex-

pectations or whether all economically viable use of the

property has been denied. Rather, the Court of Appeals

focuses on the public purpose served by denying the oper-

ating license. In so doing, the Court of Appeals interprets

Keystone Bituminous Coal Association v. DeBenedictts,

180 U.S. —, 94 L. Ed. 2d 472 (1987), as resurrecting the

rule from the century old police power case of Mugler v.

Kansas, 123 U.S. 623 (1887). Mugler was held to be dis-

positive of Allied-General’s takings claim. The opinion

below states:

‘*A major constitutional holding in its day, [the]

authority [of Mugler v. Kansas| had been thought

impaired by later cases and particularly by Pennsyl-

vania Coal Co. v. Mahon. .. . The 1887 Supreme Court

held that state action under its ‘police power’ to pro-

tect the ‘public health, the public morals, and the pub-

lic safety,’ cannot be a taking.

‘“‘Now in Keystone Bituminous Coal Ass'n v.

DeBenedictis . . . the Supreme Court has dusted off

Mugler and put it back on its pedestal, while reducing

Pennsylvania Coal Co. v. Mahon as a precedent pretty

much to its own peculiar facts.’’ Allted-General

Nuclear Services v. United States, 839 F.2d 1572, 1576

(Fed. Cir. 1988), appendix to petition (App.) at 8a-9a.

2 For a complete statement of the facts see the petitioners’

statement (petition at 2-10) and the opinion below (appendix to

petition at 1a-6a).

Thus, the Court of Appeals interprets Keystone Coal

as establishing in the current law a broad exception to the

Takings Clause whenever the government action involves

an exercise of the police power. Such an exception virtu-

ally eliminates the Fifth Amendment as an effective tool

for protecting private property rights from police power

abridgment. As even the Court of Appeals below noted:

‘The rule of Mugler is drastic indeed.’ Jd. at 1576, App.

at Sa.

This amicus brief is limited to the first issue pre-

sented by petitioners, t.e., whether the Court of Appeals

incorrectly applied a police power exception to bar com-

pensation even though the government action allegedly

denies all economically viable use of the property and

interferes with reasonable investinent-backed expectations.

ty.

Vv

SUMMARY OF ARGUMENT

The Court of Appeals for the Federal Circuit has de-

cided that a valid exercise of the police power cannot be

the subject of a takings claim. ‘The basis for this ruling

is this Court’s decision last term in Aeystone Coal. Amicus

contends that the Court of Appeals’ interpretation of A ey-

stone Coal is incorrect and in direct conflict with takings

jurisprudence recognizing that even an otherwise valid

police power regulation can go too far and result in a

taking. The recent Supreme Court decisions in Firs/

English Evangelical Lutheran Church of Glendale v.

County of Los Angeles, 482 U.S. —, 96 L. Ed. 2d 250

(1987), and Nollan v. California Coastal Commission,

6

483 U.S. —, 97 L. Ed. 2d 677 (1987), strongly support the

concept that police power regulations may result in a taking.

Accordingly, the Court of Appeals’ interpretation of Aey-

stone Coal is clearly wrong. This Court should grant the

petition for writ of certiorari so as to clarify the meaning

of Keystone Coal regarding any police power exception to

the Takings Clause. This is a significant national issue

which has generated conflicting views among the federal

circuit courts and state supreme courts.

REASONS FOR GRANTING THE PETITION

I

THE COURT OF APPEALS’ DECISION

RECOGNIZING A POLICE POWER EXCEPTION

TO THE TAKINGS ANALYSIS IS IN DIRECT

CONFLICT WITH SUPREME COURT PRECEDENT

AND ESTABLISHED TAKINGS

CLAUSE JURISPRUDENCE

Amicus respectfully urges this Court to address and

clarify the role played by the publie purpose underlying

governmental actions in the regulatory taking analysis.

The Court’s opinion last term in Aeystone Coal has gen-

erated substantial disagreement and conflicting law among

the federal circuits as well as in the state courts as to

whether the police power authority to enact safety regula-

tions insulates the responsible governmental entity from

takings claims. The opinion of the Court of Appeals be-

low is among those interpreting Keystone Coal as mean-

ing that otherwise legitimate police power regulations can-

not, as a matter of law, effect a taking. This position

i

stands in sharp contrast to other circuit and state court

decisions and the established regulatory takings jurispru-

dence of this Court.

A. Regulatory Takings Jurisprudence

A century ago, this Court established in Mugler v.

Kansas that all property is held under the implied obliga-

tion that the owner’s use of it shall not be injurious to the

community. Mugler, 123 U.S. at 665. Therefore, prohibit-

ing noxious uses of property is a valid exercise of the

police power. Jd. at 666-67. Accordingly, the Court de-

cided in Mugler that prohibiting operation of a distillery

was a proper exercise of the police power. Jd. The second

issue decided was the takings claim. Given that there was

a valid exercise of the police power, the question presented

was whether the prohibition constituted a taking under

eminent domain principles. On this issue, the Court held

that no taking could result from police power restrictions

of private property use. Jd. at 668-69. An exercise of the

police power was viewed as different in principle from an

exercise of the eminent domain power and therefore a land

use regulation, regardless of its impact on the owner, could

not be a taking.’

‘* As already stated, the present case must be gov-

erned by principles that do not involve the power of

eminent domain, in the exercise of which property

may not be taken for public use without compensa-

tion. A prohibition simply upon the use of property

3 For an excellent review describing the development of the

Mugler distinction between police power restrictions and Fifth

Amendment takings claims, see Bosselman, Callies, and Banta,

The Takings Issue 106-23 (1973).

8

for purposes that are declared, by valid legislation,

to be injurious to the health, morals, or safety of the

community, cannot, in any just sense, be deemed a

taking or an appropriation of property for the public

benefit.’’ Jd. at 668-69.

The Mugler rationale was followed in numerous turn

of the century cases to uphold police power regulations

and reject takings claims even though the landowner suf-

fered drastic reductions in value and limitations of use.‘

The Supreme Court substantially changed the takings

analysis in 1922 when Justice Holmes established that an

otherwise valid police power regulation can go ‘‘too far’’

and result in a taking. Pennsylvania Coal Co. v. Mahon,

260 U.S. 393, 415 (1922). Justice Brandeis, in dissent,

recognized the Court’s break from the Mugler decision.

Id. at 417-18 (Brandeis, J., dissenting).

Pennsylvania Coal marks the beginning of modern

regulatory takings jurisprudence. Under the now well-

established regulatory takings doctrine, the relevance of

Mugler should be limited to the accepted proposition that

. See, e.g., California Reduction Co. v. Sanitary Reduction

Works, 199 U.S. 306 (1905). The Court stated in California Re-

duction:

“‘(T}he clause prohibiting the taking of private property

without compensation is not intended as a limitation .

of those police powers which are necessary to the tran-

quility of every well-ordered community, nor of that gen-

eral power over private property which is necessary for

the orderly existence of all governments. It has always

been held that the legislature may make police regula-

tions, although they may interfere with the full enjoyment

of private property, and though no compensation is given.’ ”

Id. at 324-25.

Perhaps the most well-known case from the Mugler era was

Hadachek v. Sebastian, 239 U.S. 394 (1915).

the police power may be used to regulate injurious uses

of property. Mugler and the cases following that decision

have no relevance to the inquiry under Pennsylvania Coal

of whether a regulation goes too far and constitutes a

taking. Under Mugler a use restriction simply could

not go too far because the police power was not limited

by the Takings Clause. However, the approach since

Pennsylvania Coal recognizes that the police power is

limited by the Takings Clause and compensation is re-

quired when otherwise legitimate regulations go too far

in abridging property rights.

Agins v. City of Tiburon, 447 U.S. 255 (1980), estab-

lished the accepted framework for the modern regulatory

takings analysis. Under the Agins formulation, a land

use regulation effects a taking if it fails to substantially

advance legitimate governmental interests or denies the

owner economically viable use of the land. /d. at 260. A

regulation can be found to effect a taking under either

branch of the analysis.

The two-step analysis in Agims recognizes first that

a regulation must be a valid exercise of the police power.

The inquiry analyzes whether the regulation is supported

by legitimate public purposes. Mugler and other police

power cases are relevant to this inquiry. If the regula-

tion fails to substantially advance legitimate government

interests, the action is not a valid regulatory measure

and the resulting abridgment of property rights is an out-

right taking of those rights. Last term, in Nollan v. Cali-

fornia Coastal Commission, 97 L. Ed 2d 677, the Court

strongly reaffirmed this first part of the Agins formula-

tion. In Nollan the Court found that a regulatory action

10

conditioning a building permit on the dedication of prop-

erty failed to substantially advance legitimate govern-

mental interests and therefore was not a valid police

power regulation but was a taking. Nollan, 97 L. Ed. 2d

at 687, 689; see also Penn Central Transportation Co. v.

City of New York, 488 U.S. 104, 127 (1978) (use restric-

tion may constitute a taking if not reasonably necessary

to the effectuation of a substantial public purpose) ;

Wheeler v. City of Pleasant Grove, 833 F.2d 267 (11th Cir.

1987) (ordinance prohibiting apartment building was ar-

bitrary and bore no substantial relation to legitimate con-

cerns and was therefore a compensable taking).

If the challenged regulation satisfies the first prong

of the Agins test so that it serves a legitimate regulatory

purpose, there is still a need to focus on the economic

impact of the regulation. Under this second part of the

Agins formulation, the inquiry is whether the regulation

denies all economically viable use or unduly interferes

with reasonable investment-backed expectations. See, e.g.,

Keystone Coal, 94 L. Ed. 2d at 493-501. This part of the

Agins formulation derives from the Pennsylvania Coal

‘‘too far’’ test and each case wili turn on its own par-

ticular facts. Significantly, a regulation which satisfies

the first prong of Agins may still result in a taking on

this second prong if the impact on the individual’s prop-

erty rights goes too far. Even Justice Brennan’s dissent

in Nollan agrees with this principle. Justice Brennan

stated:

““The fact that the Commission’s action is a legit-

imate exercise of the police power does not, of course,

11

insulate it from a takings challenge, for when ‘regu-

lation goes too far it will be recognized as a taking.’ ”’

Nollan 97 L. Ed. 2d at 699 (Brennan, J., dissenting).

The Court of Appeals for the Seventh Circuit per-

haps best stated the change in the takings analysis since

Mugler. That court wrote:

‘‘Though the Supreme Court has held in past deci-

sions, Mugler v. Kansas, that an exercise of the po-

lice power may never amount to a taking, the Court

has retreated from that principle in more recent de-

cisions. See San Diego Gas & Electric Co. v. City of

San Diego; Agins v. City of Tiburon; Pennsylvania

Coal Co. v. Mahon. Thus, while the Department of

Health unquestionably acted under the local police

power and while that fact alone might under past

precedents justify the conclusion that no taking had

occurred, that rationale, standing alone, no longer

adequately resolves the issue.’’ Barbian v. Panagis,

694 F.2d 476, 485 n.7 (7th Cir. 1982) (citations

omitted).

B. The Opinion Below Misconstrues Keystone Coal

and Is in Direct Conflict with United States

Supreme Court Precedent

The Keystone Coal decision expressly applies the

Agins framework by focusing first on whether the regu-

lation at issue substantially advanced legitimate public

purposes and then by turning separately to the economic

impact analysis. Keystone Coal, 94 L. Ed. 2d at 488.

However, in discussing the public purposes for the regu-

lation under the first prong of Agins, the Keystone Coal

opinion has resulted in confusion of the lower courts.

The opinion below illustrates how the lower courts have

been misled into applying an all-encompassing police

power exception to the takings analysis.

12

The relevance of discussing the public purposes for

the state action under the first prong of Agins is to de-

termine whether the action is a valid exercise of the po-

lice power. However, the language in Keystone Coal and

the citations to Mugler and other pre-Mahon cases appear

to suggest that if a regulation is supported by valid pub-

lic purposes so that it substantially advances legitimate

objectives, this alone is sufficient to resolve the takings

inquiry without next turning to the economic impact analy-

sis. Keystone Coal, 94 L. Ed. 2d at 490-93. The dissent

in Keystone Coal apparently recognized this potential in-

terpretation of the majority opinion and responded by

correctly pointing out that a valid public purpose for a

regulation does not answer the question of whether a

taking has occurred but is merely a prerequisite to the

exercise of governmental powers. Jd. at 505 (Rehnquist,

C.J., dissenting).

By interpreting Keystone Coal as meaning that valid

police power purposes insulate the regulation from a tak-

ings claim, the Court of Appeals has returned to the

Mugler rule that valid restrictions on use of property

cannot be a taking. This is completely inconsistent with

the Supreme Court’s takings jurisprudence since Pennsyl-

vania Coal. Only three months after Keystone Coal the

Court rejected any notions that Pennsylvania Coal was no

longer good law. In First Church, Justice Rehnquist cited

Pennsylvania Coal as the origin of the established doctrine

that a regulation may result in a taking. First Church,

96 L. Ed. 2d at 264-65. The dissent, however, continued

to push for an exception to the regulatory takings law.

Justice Stevens contended that Keystone Coal explained

13

the ‘‘rule’’ that regardless of whether a regulation de-

prives the owner of property on a permanent or temporary

basis, health and safety regulation cannot constitute a

taking. First Church, 96 L. Ed. 2d 270-71 ».4 (Stevens, J.,

dissenting). The majority expressly left the issue unre-

solved, commenting that the case presented no occasion to

decide whether the denial of all use ca be insulated from

the compensation requirement becayse o* the state’s au-

thority to enact safety regulations.

Now, in the case presented for the Court’s review,

the opinion below adopts an interpretation of Keystone

Coal that recognizes a broad exception to tie Takings

Clause whenever the regulation is a valid exercise of the

police power. The Court of Appeals expressly follows ihe

long abandoned rule from Mugler and reduces the rele-

vance of Pennsylvania Coal to a precedent limited to its

peculiar facts. This decision directly conflicts with the

Court’s many regulatory takings cases, including Agins,

First Church, and Nollan, and more significantly, effec-

tively eliminates the Fifth Amendment Takings Clause as

a limit on police power land use regulation. The Court

should now correct the confusion and misinterpretation

that its Keystone Coal decision is causing and preserve

the constitutional protection of property rights intended

through the Fifth Amendment Takings Clause.

II

THIS COURT SHOULD NOW CLARIFY

WHETHER POLICE POWER ACTIONS FOR

HEALTH AND SAFETY PURPOSES ARE

INSULATED FROM REGULATORY TAKINGS CLAIMS

Amicus respectfully urges that the Court should now

address whether a police power exception to the takings

14

analysis exists. The issue is of paramount importance to

governmental bodies and landowners who must know where

the economic burden for regulatory takings will fall. The

decision in First English Evangelical Lutheran Church of

Glendale v. County of Los Angeles, 96 L. Ed. 2d 250, estab-

lishes that compensation is the required constitutional

remedy for regulatory takings; however, a broad police

power exception as recognized by the court below would

circumvent the First Church decision and render the con-

stitutional protection meaningless. The relationship be-

tween the police power and the Takings Clause has long

been a vexing constitutional issue. The Court should now

reject the Kederal Circuit’s interpretation of a broad

police power exception and clarify the scope of any nar-

rower health and safety or nuisance exception that may

exist.

The importance for the Court to now clarify the rela-

tionship between the police power and the Takings Clause

is necessary to correct and prevent other courts from mis-

interpreting and further confusing the takings jurispru-

dence. At least one other court has recognized a broad

police power exception as being created by Keystone Coal.

The Washington Supreme Court stated:

‘*As we read the Keystone Coal Ass’n opinion, exer-

cises of the police power cannot be characterized as a

compensable taking whenever the state imposes land

use restrictions in order to safeguard the ‘public

interest in health, the environment, and the fiscal in-

tegrity of the area.’ This insulation from the takings

analysis continues, even if the regulation denies a

landowner all economically viable use of the prop-

erty.’’? Orion Corp. v. State, 109 Wash. 2d 621, 654

(1987) (citations omitted).

in a Ena

15

In contrast, the Pennsylvania Supreme Court has in-

terpreted Keystone Coal as an application of the Agins

formulation. McClimans v. Board of Supervisors of She-

nango Township, 529 A.2d 562 (Pa. Commw. 1987). The

Pennsylvania court added emphasis showing that either

prong of Agins may be the basis for finding a regulatory

taking. Jd. at 568. The court first found that the regula-

tion prohibiting strip mining in a residential zone was a

valid exercise of the police power because it substantially

advanced legitimate public purposes. Jd. There was no

taking therefore on that basis. The court next focused on

the economic impact of the regulation. Significantly, no

police power, health and safety, or nuisance exception was

recognized even though the purposes of the regulation

were to prevent contamination of drinking water sources

and the drifting of toxic smoke.

The Ninth Cireuit has also not recognized any police

power exception to the takings analysis. The Ninth Circuit

recently stated: ‘‘Second, even if the government’s action

is a legitimate exercise of the police power, it is not insu-

lated from a taking challenge. Proof that a regulatory

decision ‘goes too far’ does not require a showing that the

decision is arbitrary or irrational.’’ Herrington v. County

of Sonoma, 834 F.2d 1488, 1498 n.7 (9th Cir. 1987). How-

ever, in sharp disagreement with the Ninth Circuit, the

Third Cireuit views the police power inquiry as controlling

in a regulatory takings claim. The Third Circuit recently

held that a regulation must fail to satisfy both prongs of

Agins before a regulatory taking can be found. Empire

Kosher Poultry v. Hallowell, 816 F.2d 907 (3rd Cir. 1987).

This means that a valid police power regulation cannot

result in a taking. The Third Circuit stated:

16

‘‘Thus Keystone Bituminous makes clear that to pre-

vail on a regulatory taking claim, a claimant must

establish both that the governmental action falls out-

side the traditional police power, and that the govern-

mental action sufficientiy interferes with investment-

based expectations.

“The first component of the Keystone Bituminous

analysis is controlling.’’ Empire Kosher, 816 F.2d

at 915.

The significant and growing conflict among the cir-

cuit courts and state Supreme Courts as to the meaning of

Keystone Coal and the proper analysis for a takings claim

requires direction by the Supreme Court. This diver-

gence even spills over into academia. One legal writer com-

ments that Pennsylvania Coal remains vital even after the

Keystone Coal decision. vonLembke, Keystone Bitum-

inous Coal Association v. DeBenedictis and the Status of

Coal in Pennsylvania, 111 Harv. J.L. & Pub. Pol’y 227

(1988). Others suggest that Keystone Coal has recog-

nized some undetermined nuisance exception to the takings

analysis. Peterson, Land Use Regulatory ‘‘Takings’’ Re-

visited: The New Supreme Court Approaches, 39 Hastings

L.J. 335, 345 (1988). The conflict created in Keystone

Coal over whether both prongs of Agims must be satisfied

was well illustrated by yet another article. Falik and

Shimko, The ‘‘Takings’’ Nexus—The Supreme Court

Chooses a New Direction in Land-Use Planning: A View

from California, 39 Hastings L.J. 359, 361-64 (1988). Fin-

ally, Professor Epstein suggests that Keystone Coal was

an aberration which quickly died in First Church. Epstein,

Takings: Descent and Resurrection, Sup. Ct. Rev. 1, 45

(1987). Clearly, the growing disagreement among courts

and legal writers as to the significance of Keystone Coal

nF

17

and any police power exception is of broad national con-

cern that warrants this Court’s attention.

CONCLUSION

For the reasons stated above, it is respectfully sub-

mitted that the petition for writ of certiorari should be

granted.

DATED: June, 19838.

Respectfully submitted,

Of Counsel RONALD A. ZUMBRUN

"EDWARD J. CONNOR, JR.

JOHN M. GROEN “COUNSEL OF RECORD

Pacific Legal Foundation Pacific Legal Foundation

555 Capitol Mall, Suite 350 555 Capitol Mall, Suite 350

Sacramento, California 95814 Sacramento, California 95814

Telephone: (916) 444-0154 Telephone: (916) 444-0154

Attorneys for Amicus Curiae