Amicus Curiae Brief — Pappas v. City of Las Vegas Downtown Redevelopment Agency

MOTION FILED ZN

FEB 6 - 2004 ‘7

No. 03-972

Jn The

Supreme Court of the Anited States

*

CAROL PAPPAS, JOHN H. PAPPAS, JR.,

and HARRY J. PAPPAS,

Petitioners,

v.

CITY OF LAS VEGAS DOWNTOWN REDEVELOPMENT

AGENCY, FREMONT STREET EXPERIENCE LIMITED

LIABILITY COMPANY, and FREMONT STREET

EXPERIENCE PARKING CORPORATION,

Respondents.

¢

On Petition For A Writ Of Certiorari

To The Supreme Court Of Nevada

¢

MOTION FOR LEAVE TO FILE AND

BRIEF OF ARIZONA PROPERTY OWNERS SAIED

AFKARY, MARK LAMBARD, KENNETH B. PILLOW

AND MARY ANN PILLOW AS AMICI CURIAE

IN SUPPORT OF PETITIONERS

¢

ILYA SOMIN ViET D. DINH

GEORGE MASON UNIV. (Counsel of Record)

SCHOOL OF LAW BANCROFT ASSOCIATES, PLLC

3301 N. Fairfax Drive 2121 Bancroft Place, N.W.

Arlington, VA 22201 Washington, D.C. 20008

(703) 993-8069 (202) 662-9324

February 6, 2004 Counsel for Amici

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

OR CALL COLLECT (402) 342-2831

1

MOTION FOR LEAVE TO FILE AND

BRIEF OF ARIZONA PROPERTY OWNERS SAIED

AFKARY, MARK LAMBARD, KENNETH B. PILLOW

AND MARY ANN PILLOW AS AMICI CURIAE

IN SUPPORT OF PETITIONERS

Pursuant to Rule 37.2(b) of the Rules of this Court,

Arizona property owners Saied Afkary, Mark Lambard,

Kenneth B. Pillow, and Mary Ann Pillow respectfully move

for leave to file the attached brief as amici curiae in

support of the Petitioner.

The Petitioners have consented to the filing of this

brief. However, respondents have not responded to re-

quests for consent. Amici file this motion, as required by

Rule 37.2(b), because parties to the case have presumably

withheld consent, in order to call the Court’s attention to

legal developments and matters not already brought to its

attention by the parties.

4

7

INTERESTS OF AMICI CURIAE

Amici Saied Afkary, Mark Lambard, Kenneth B.

Pillow, and Mary Ann Pillow are property owners in

Tempe, Arizona, who resisted efforts by a private devel-

oper to acquire land to construct a seven- to ten-acre

shopping center. The developer acquired all other neces-

sary properties, but amici refused to sell their land. The

City of Tempe thereafter initiated eminent domain pro-

ceedings against amici. Amici contested the eminent

domain, alleging abuse of the taking power to advance

private interests. Discovery in those proceedings indicated

that the City had entered into a contract to transfer

amici’s land to the private developer at apparently below-

market values in return for a percentage of the profits

from the private shopping center.

While the proceedings were pending, Bailey v. Myers,

76 P.3d 898, 904 (Ariz. Ct. App. 2003) held that “when a

proposed taking for a redevelopment project will result in

private commercial ownership and operation, the Arizona

constitution requires that the anticipated public benefits

must substantially outweigh the private character of the

end use so that it may truly be said that the taking is for a

use that is ‘really public.’” Thereafter, the City agreed to a

stipulated dismissal of the eminent domain proceedings

against amici. The trial court’s award of costs and attor-

neys fees to amici relating to those proceedings is pending

appeal.

Amici Kenneth B. Pillow and Mary Ann Pillow have

testified before the Arizona legislature about their experi-

ence with abuse of the eminent domain power. Amici

continue to engage in advocacy activities to encourage

proper application of the Fifth Amendment to limit taking

of property only for public use and not to advance private

interests. All amici believe that the issue presented to the

Court by the petition for writ of certiorari is one of na-

tional importance that should be resolved by the Court.

For the foregoing reasons, amici curiae respectfully

request that they be allowed to participate in this case by

filing the attached brief.

Respectfully submitted,

ILYA SOMIN VIET D. DINH

GEORGE MASON UNIV. (Counsel of Record)

SCHOOL OF LAW BANCROFT ASSOCIATES, PLLC

3301 N. Fairfax Drive 2121 Bancroft Place, N.W.

Arlington, VA 22201 Washington, D.C. 20008

(703) 993-8069 (202) 662-9324

February 6, 2004 Counsel for Amici

QUESTIONS PRESENTED

Does the Public Use Clause of the Fifth Amendment,

which permits condemnation of property only for a

“public use,” impose any limit on governmental power

to take property to advance private interests?

Does Hawaii Hous. Auth. v. Midkiff, 467 U.S. 229

(1984) require deference to the government’s post hoc

assertion of public use as a pretext for expropriation

of property for the benefit of private interests?

Does Berman v. Parker, 348 U.S. 26 (1954), which

authorizes condemnation to alleviate blight in slum-

like areas, license expropriation of property when nei-

ther the property nor its surrounding area is actually

blighted?

Is an effectively unlimited power to condemn private

property for private interests consistent with this

Court’s determination to protect property rights on an

equal basis with other constitutional rights?

TABLE OF CONTENTS

Page

SP MREEE OPE UEE FMI MIES 1 IOED os.cnescccvssscsssceceosvecnssocscoss i

TABLE OF AUTHORITIEG........... ci vankazelsaniavcetlieate ili

INTEREST OF AMICI CURIAGE.................ccccceeeeeees 1

PEPER NEES SCPE BEAK CASE, ....cncccrsvcvcscccsscnssesssccese 2

REASONS FOR GRANTING THE PETITION......... 2

I. The decision below misinterprets Hawaii

Hous. Auth. v. Midkiff, 467 U.S. 229 (1984),

to permit virtually unlimited government

power to condemn property for private uses

and conflicts with decisions by the Seventh

EE IE cco nicsnsdcciinctansivacinvenareeieane 5

A. The decision below would allow the tak-

ing of virtually any property.................6 6

B. The judgment below conflicts with deci-

sions by the Seventh and Ninth Circuits... 9

II. The decision below misinterprets Berman v.

Parker, 348 U.S. 26 (1954), to allow condem-

nation to alleviate “blight” even absent slum-

like conditions, and thus conflicts with the

Supreme Judicial Court of Massachusetts..... 15

IIt. The decision below is incompatible with this

Court’s Case law granting protection to con-

stitutional property rights fully equal to that

accorded other constitutional rights.............. 18

NG i rtnveriinnnrscnnuiesssncannnnininnekacessantainlamnestin 20

ili

TABLE OF AUTHORITIES

Page

CASES

99 Cents Only Stores v. Lancaster Redev. Agency,

237 F. Supp. 2d 1123 (C.D. Cal. 2001)....................... 7,14

Aaron v. Target Corp., 269 F. Supp. 2d 1162 (E.D.

Mo. 2003), rev’d on other grounds, 2004 WL

190439 (Sth Cir. Feb. 3, 2004).............c0ssssesscosesssssseees 7,14

Armendariz v. Penman, 75 F.3d 1311 (9th Cir.

IE cactinisiinerissakbvcidivepeianatedaiebeietianasiaalinamads passim

Avalonbay Cmtys., Inc. v. Town of Orange, 775 A.2d

Ee I: HII Biiconschsccsuincnddeeesncth eudeianeceummnane mn iieniin 13

Bailey v. Myers, 76 P.3d 898 (Ariz. Ct. App. 20038).............. 1

Baycol, Inc. v. Downtown Development Auth., 315

ie eR Be Ov seicendshcncciccicccatencnnaensunnacnsiiidneinans 8

Berman v. Parker, 348 U.S. 26 (1954)......... 3, 15, 16, 17, 18

Casino Reinvestment Dev. Auth. v. Banin, 727 A.2d

102 (N.J. Super. Ct. Law Div. 1998)................ccccccsssseees 13

Chicago, Burlington & Quincy R.R. Co. v. Chicago,

SE Fi EES entetiicitnensiidiiiaamnnies 5,19

City of Cincinatti v. Vester, 281 U.S. 4389 (1930)........... 5, 20

City of Little Rock v. Raines, 411 S.W.2d 486 (Ark.

PEGE sisicanscnsnensigiuincinnsabiadapeeaiiaihesidaipatiiliamisanieiuatiib uae 8

City of Miami v. Wolfe, 150 So.2d 489 (Fla. App.

BID iscisvcsiesacnanvientuaoneaaeiiadipas sada adeimnmdioin 13

Cottonwood Christian Ctr. v. Cypress Redev. Agency,

218 F. Supp. 2d 1203 (C.D. Cal. 2002) ............scccreserseses 14

County of Wayne v. Hathcock, 671 N.W.2d 40 (Mich.

BOD isksientsnsichentieninceevetnesonsensustncioneanetaimeasmaacaniianiaan 8

TABLE OF AUTHORITIES — Continued

Page

County of Wayne v. Hathcock, 2003 WL 1950233

Cie. CO. A. Bae. BG, BDOGP iccsessievesscsessesngusviecessssensnnes 8

Daniels v. Area Plan Comm’n, 306 F.3d 445 (7th

Ce PTE nikki nentinvinsiehintiabucensianmaialihiadiomnnenadibeins passim

Denver W. Metro. Dist. v. Geudner, 786 P.2d 434

CE FR: Be encinenenstsrnciveesiicensdanemesksesmetinnbicnanens 13

Dolan v. City of Tigard, 512 U.S. 374 (1994) ..... eee 5

Earth Mgmt., Inc. v. Heard County, 283 S.E.2d 455

EG ikinevalntesascsienednncasisaseamneteipactanassainmindenaelaanteins 13

Essex Fells v. Kessler Inst., 673 A.2d 856 (N.J.

NE: CR. Fate TIN Biases tesneissenviscnsesansionisnsnevsnnenanes 13

Ga. Dep’t of Transp. v. Jasper County, 586 S.E.2d

Re Ge, titers nk ohenedanaranens 8

Greater New Orleans Broad. Ass’n v. United States,

SEE Fs 60 Nadiesinindtaemiatinineis 17

Hawii Hous. Auth. v. Midkiff, 467 U.S. 229 (1984) .. passim

Hogue v. Port of Seattle, 341 P.2d 171 (Wash. 1959).....8, 17

In re Petition of Seattle, 638 P.2d 549 (Wash. 1981)........... 8

Karesh v. City of Charleston, 247 S.E.2d 342 (S.C.

FPF sis ccindicadssusialicsimuumnitinesissbiauaimeabeinsamcaadeaiin 8

Lynch v. Household Fin. Corp., 405 U.S. 538 (1972) 4, 18, 20

Madisonville Traction Corp. v. St. Bernard Mining

CR FES itis eee Ct sticiovatiespincsensinreciavsnttinstentinenss 5

Merrill v. City of Manchester, 499 A.2d 216 (N.H.

TIPU vstiissdcicastdsiosndicapuicec odalakipiobe ehgeneciencraniia sesamiae alae uaceaaacendiren 8

Opinion of the Justices, 126 N.E.2d- 795 (Mass.

BE “skins aicnichescoluaceaececuenctulenteuniciatiodanl daienamaaens 3, 4, 17, 18

TABLE OF AUTHORITIES — Continued

Page

Opinion of the Justices, 131 A.2d 904 (Me. 1957)............... 8

Owensboro v. McCormick, 581 S.W.2d 3 (Ky. 1979)............ 8

Pheasant Ridge Ass’n v. Town of Burlington, 506

Pe Re ke EDs BONE Pricchatidanaiacacentsnbacadaeamnainciinsin 13

Poletown Neighborhood Council v. City of Detroit,

OR Fi, re Se Ls CED eis sisiensvcnnsctssssrtinieasinveienction 8

Prestonia Area Neighborhood Ass’n v. Abramson,

Fe I Fe CR NE nietsitiscentsinnciensetanbntericrignanntmnnic 9

Redev. Auth. v. Owners, 274 A.2d 244 (Pa. Cmmw.

Pt APE e cnniccrneindesanninemionntansnaiestaacineciasatiaddahauacaaienia 13

S.W. Ill. Dev. Auth. v. Nat'l City Env., 768 N.E.2d 1

SRN. Nena NN ONTO ETE eT TE 7,12

Stone v. Powell, 428 U.S. 465 (1976).............cccccosccscssccssces 20

Thompson v. Consolidated Gas Corp., 300 U.S. 55

A SIEE D iinisasesinsanstontinschsbicailes Savsnisioa aang aediaaaaeadapbananeen 3,5

United States v. Lopez, 514 U.S. 549 (1995) .... eee 4

Wilmington Parking Auth. v. Land with Improve-

mnarete, GEL AT Bas CE, TI vicissisccncssesccessveciasisaccens 13

FEDERAL CONSTITUTIONAL PROVISIONS AND STATUTES

ee Tt MIG WF eacincccrtatcdnsiuntenesnsseneteisiicninnenndiens 2, 7,18

Wits SINE: MII, BEET © Betinsicssccoscesecsinemisinstavenceiemisninniens 5

STATE STATUTES

NEV. REV. STAT. § 279.58G(1) (2O0O3).............cccccccccccccsccsccees 11

TABLE OF AUTHORITIES -— Continued

Page

OTHER AUTHORITIES

Guido Calabresi & A. Douglas Melamed, Property

Rules, Liability Rules, and Inalienability Rules:

One View of the Cathedral, 85 Harv. L. Rev. 1089

Raich sirshan ae'ociedbaprudcbelickild itsceineatataeonisauinaisieedieaaaadeatiins 19

JAMES W. ELY, THE GUARDIAN OF EVERY OTHER

RIGHT: A CONSTITUTIONAL HISTORY OF PROPERTY

s+» RRS eta aa pee Pian oem IO PDB eT 18, 19

RICHARD A. EPSTEIN, TAKINGS: PRIVATE PROPERTY

AND THE POWER OF EMINENT DOMAIN (1985)..............66. 19

GEORGE L. KELLING & CATHERINE L. COLES, FIXING

BROKEN WINDOWS: RESTORING ORDER AND RE-

DUCING CRIME IN OUR COMMUNITIES (1996).................6 17

RICHARD PIPES, PROPERTY AND FREEDOM (1999)............... 18

Ilya Somin, Michigan Should Alter Property Grab

Rules, Det. News, Jan 8, 2004, § A, at 11... ee 8

INTEREST OF AMICI CURIAE’

Amici Saied Afkary, Mark Lambard, Kenneth B.

Pillow, and Mary Ann Pillow are property owners in

Tempe, Arizona, who resisted efforts by a private devel-

oper to acquire land to construct a seven- to ten-acre

shopping center. The developer acquired all other neces-

sary properties, but amici refused to sell their land. The

City of Tempe thereafter initiated eminent domain pro-

ceedings against amici. Amici contested the exercise of

eminent domain, alleging abuse of the taking power to

advance private interests. Discovery in those proceedings

indicated that the City had entered into a contract to

transfer amici’s land to the private developer at appar-

ently below-market values in return for a percentage of

the profits from the private shopping center.

While the proceedings were pending, Bailey v. Myers,

76 P.3d 898, 904 (Ariz. Ct. App. 2003) held that “when a

proposed taking for a redevelopment project will result in

private commercial ownership and operation, the Arizona

constitution requires that the anticipated public benefits

must substantially outweigh the private character of the

end use so that it may truly be said that the taking is for a

use that is ‘really public.’” Thereafter, the City agreed to a

stipulated dismissal of the eminent domain proceedings

against amici. The trial court’s award of costs and attor-

neys fees to amici relating to those proceedings is pending

appeal.

* Consistent with Rule 37.6, this brief has not been authored in

whole or in part by counsel for a party. No person, other than amici or

their counsel, has made a monetary contribution to the preparation or

submission of this brief.

2

Amici Kenneth B. Pillow and Mary Ann Pillow have

testified before the Arizona legislature about their experi-

ence with abuse of the eminent domain power. Amici

continue to engage in advocacy activities to encourage

proper application of the Fifth Amendment to limit taking

of property only for public use and not to advance private

interests. All amici believe that the issue presented to the

Court by the petition for writ of certiorari is one of na-

tional importance that should be resolved by the Court.

STATEMENT OF THE CASE

- Amici adopt the statement of the case presented in the

Petition. For the Court’s convenience, amicus notes here

only the salient fact that the City of Las Vegas Downtown

Redevelopment Agency, in taking Petitioners’ property,

was acting to advance the interests of the Fremont Street

Experience Limited Liability Company (“LLC”), a private

consortium of casinos. The trial court found that the

Redevelopment Agency had “turned over all control” of the

eminent domain process to the LLC. Pet. App. at 101a.

Petitioners presented evidence that “the Agency was

acting as a front for the LLC.” Jd. at 95a.

REASONS FOR GRANTING THE PETITION

The Nevada Supreme Court misinterpreted Hawaii

Hous. Auth. v. Midkiff, 467 U.S. 229 (1984), to permit

virtually limitless government power to condemn private

property and transfer it to other private parties. The

decision below permits government condemnation of

property where there are “downward trends in the business

community, relocation of existing businesses outside of the

community, business failures, and loss of sales or visitor

volumes.” Pet. App. at 20a. This standard guts the public

use requirement of the Fifth Amendment of any meaning

because all areas experience periodic “downward trends in

= - : :

3

the business community” and occasional “loss of sales or

visitor volumes.” Rather than reading the Public Use

Clause out of the Constitution, Midkiff reiterated the

principle that “‘one person’s property may not be taken for

the benefit of another private person without a justifying

public purpose.’” Midkiff, 467 U.S. at 241 (quoting Thomp-

son v. Consol. Gas Corp., 300 U.S. 55, 80 (1937)).

The opinion below conflicts with decisions by the

Seventh and Ninth Circuits interpreting the Public Use

Clause to impose meaningful limits on the government’s

power to take private property. See Daniels v. Area Plan

Comm'n, 306 F.3d 445, 462 (7th Cir. 2002) (striking down

condemnation for lack of a public use); Armendariz v.

Penman, 75 F.3d 1311, 1321-22 (9th Cir. 1996) (en banc)

(same). First, it misinterprets Midkiff as requiring broad

deference to the government’s condemnation decision even

though the putative public use justification, the alleviation

of “blight,” was only asserted after the fact. Armendariz

and Daniels both hold that deference is inappropriate for

such post hoc assertions. Daniels, 306 F.3d at 465; Armen-

dariz, 75 F.3d at 1321. Second, the decision below conflicts

with Armendariz’ denial of deference to pretextual asser-

tions of public use to justify condemnations intended to

benefit private interests. See id. The trial court found that

the Redevelopment Agency had “turned over all control” of

the eminent domain process to the LLC. Pet. App. at 101a.

Petitioners presented evidence that “the Agency was

acting as a front for the LLC.” Id. at 95a.

The decision below also misinterprets Berman v.

Parker, 348 U.S. 26 (1954), thereby creating a conflict with

Opinion of the Justices, 126 N.E.2d 795 (Mass. 1955). The

blighted area at issue in Berman was characterized by

“[mJiserable and disreputable housing conditions.” Ber-

man, 348 U.S. at 32. Here, the court below upheld the

taking of Petitioners’ non-blighted property simply be-

cause it was located in an area that has experienced

4

“downward trends” in economic performance or a “loss of

sales or visitor volumes.” Pet. App. at 20a. By contrast, the

Supreme Judicial Court of Massachusetts held that blight

alleviation unter Berman cannot justify condemnations in

areas where “there is no suggestion that the area is now a

slum.” Opinion of the Justices, 126 N.E.2d 795, 803 (Mass.

1955).

The decision of the Nevada Supreme Court is at odds

with this Court’s insistence that property rights under the

Takings Clause are accorded the same level of protection

as other individual rights. Unchecked power to designate

virtually any property as “blighted” and to transfer it to

other private interests cannot be reconciled with the

principle that “rights in property are basic civil rights”

that deserve protection “no less than the right to speak or

the right to travel.” Lynch v. Household Fin. Corp., 405

U.S. 538, 552 (1972).

Granting the Petition and reversing the decision

below would not affect the vast majority of condemnations,

which either take land directly for government use, or

transfer it to private parties in order to advance public

uses whose legitimacy is well-established. It would,

however, make clear that the power of eminent domain is

not a blank check governments may abuse to benefit

private interests. As this Court has demonstrated, even

very broad powers of government remain subject to consti-

tutional limits.’

* See, e.g., United States v. Lopez, 514 U.S. 549 (1995) (holding that

Congress’ broad powers under the Commerce Clause are subject to legal

limits, despite a fifty-year assumption to the contrary).

5

I. The decision below misinterprets Hawaii

Hous. Auth. v. Midkiff, 467 U.S. 229 (1984), to

permit virtually unlimited government power

to condemn property for private uses and

conflicts with decisions by the Seventh and

Ninth Circuits.

The Public Use Clause,’ if it is to have any meaning,

cannot be interpreted to give government unfettered

power to condemn private property “for the benefit of

another private person.” Thompson, 300 U.S. at 80. This

“Court’s cases have repeatedly stated that ‘one person’s

property may not be taken for the benefit of another

private person without a justifying public purpose, even

though compensation be paid.’” Midkiff, 467 U.S. at 241.

“It is fundamental in American jurisprudence that private

property cannot be taken by the government, national or

state, except for purposes which are of a public character

... That principle grows out of the essential nature of all

free governments.” Madisonville Traction Corp. v. St.

Bernard Mining Corp., 196 U.S. 239, 251-52 (1905).

Although great deference is granted to legislative deter-

minations of public use, “[iJt is well established that ...

the question [of] what is a public use is a judicial one.”

City of Cincinnati v. Vester, 281 U.S. 439, 446 (1930).

As the Ninth Circuit pointed out,

If officials could take private property, even with

adequate compensation, simply by deciding

* The Public Use Clause was made applicable against the states

through the incorporation of the Fifth Amendment under the Four-

teenth Amendment. Chicago, Burlington & Quincy R.R. v. Chicago, 166

U.S. 226, 239 (1897); see also Dolan v. City of Tigard, 512 U.S. 374, 384

n.5 (1994) (reaffirming incorporation of the Takings Clause under the

Fourteenth Amendment).

6

behind closed doors that some other use of the

property would be a ‘public use,’ and if those offi-

cials could later justify their decisions in court

merely by positing a ‘conceivable public purpose’

to which the taking is rationally related, the

‘public use’ provision of the Takings Clause would

lose all power to restrain government takings.

Armendariz, 75 F.3d at 1321; see also Daniels, 306 F.3d

445, 461-62 (relying on Armendariz to strike down a

taking intended to benefit private parties).

A. The decision below would allow the tak-

ing of virtually any property.

The decision below misconstrues Midkiff to grant, in

effect, unlimited gcvernment power to condemn property

for the benefit of private interests. Although the putative

public use justification for taking Petitioners’ property was

the alleviation of “blight,” the Nevada Supreme Court

defined blight so broadly as to make it a virtually limitless

concept: “Economic blight involves downward trends in the

business community, relocation of existing businesses

outside of the community, business failures, and loss of

sales or visitor volumes.” Pet. App. at 20a. Virtually any

area periodically experiences “downward trends,” the

“relocation of existing businesses,” business failures, and

especially “loss of sales or visitor volumes.” Id. The city

need not resort to the extreme remedy of condemnation in

_ order to alleviate these common problems, but can instead

use numerous less drastic means, such as improving

infrastructure or extending tax credits to businesses in the

area.

Indeed, the so-called blighted area at issue in this case

is the renowned “downtown area ... of the City of Las

Vegas.” Id. at 22a. Under the Nevada court’s standards,

even the casinos that stand to benefit from this condemna-

tion may be blighted, if they have experienced a “loss of

sales or visitor volumes.” Jd. Not surprisingly, neither the

7

City’s property survey nor the Development Agreement

makes any reference to the presence of blight in the area

in question. Pet. Cert. at 5. Instead, the stated purpose of

the Development Agreement was “to enhance employment

opportunities, keep companies from leaving the downtown

area, attract new businesses to the downtown area, and.

provide inducement to ... hotels and other businesses in

the downtown area.” Pet. Cert. at 4-5.

The approach adopted below would justify any con-

demnation of property to aid a private business, so long as

government officials believe (rightly or wrongly) that the

beneficiaries of its condemnation largesse could make

more money off the expropriated land than could its

present owners. The Public Use Clause would be meaning-

less if it were interpreted to sanction the transfer of

private property from one owner to another simply be-

cause the latter would “contribute to positive economic

growth in the region,” because “incidentally, every lawful

business does this.” S.W. Ill. Dev. Auth. v. Natl City Env.,

768 N.E.2d 1, 9 (Ill. 2002), cert. denied, 537 U.S. 880

(2002) (hereinafter “SWIDA”). Although the Nevada

Supreme Court may choose to eviscerate the Public Use

Clause of its state constitution in this way, it cannot do the

same to the Fifth Amendment.

Numerous other state and federal courts have invali-

dated condemnation where the putative public benefit of

increased economic development is achieved indirectly by

enriching a private entity.“ As the Supreme Court of

Kentucky explained,

* See, e.g., Aaron v. Target Corp., 269 F.Supp. 2d 1162, 1174-76

(E.D. Mo. 2003), rev’d on other grounds, 2004 WL 190439 (8th Cir. Feb.

3, 2004) (finding owner likely to prevail on claim that condemnation of

shopping center to transfer to Target Corporation lacked public use); 99

Cents Only Stores v. Lancaster Redev. Agency, 237 F. Supp. 2d 1123,

1129-31 (C.D. Cal. 2001), app. dismissed as moot, 2003 WL 932421 (9th

(Continued on following page)

8

If public use were construed to mean that the

public would be benefited in the sense that the

enterprise or improvement for the use of which

the property was taken might contribute to the

comfort or convenience of the public, or a portion

thereof, or be esteemed necessary for their en-

joyment, there would be absolutely no limit on

the right to take private property. It would not be

difficult for any person to show that a factory or

Cir. Mar. 7, 2003) (finding that condemnation to replace one store with

a more lucrative one was not a public use); City of Little Rock v. Raines,

411 S.W.2d 486, 495 (Ark. 1967) (finding private economic development

project not a public use); Baycol, Inc. v. Downtown Dev. Auth., 315 So.2d

451, 457 (Fla. 1975) (“‘[P]ublic benefit’ is not synonymous with ‘public

purpose’ as a predicate which can justify eminent domain.”); Owensboro

v. McCormick, 581 S.W.2d 3, 8 (Ky. 1979) (“No ‘public use’ is involved

where the land of A is condemned merely to enable B to build a

factory.”); Opinion of the Justices, 131 A.2d 904, 905-06 (Me. 1957)

(holding that condemnation for industrial development to enhance

economy is not a public use); Merrill v. City of Manchester, 499 A.2d

216, 217-18 (N.H. 1985) (finding condemnation for industrial park not a

public use where no harmful condition was being eliminated); Ga. Dept

of Transp. v. Jasper County, 586 S.E.2d 853, 856 (S.C. 2003) (holding

that substantial “projected economic benefit” does not justify a condem-

nation); Karesh v. City of Charleston, 247 S.E.2d 342, 345 (S.C. 1978)

(“We cannot constitutionally condone the eviction of the present

property owners by virtue of the power of eminent domain in favor of

other private shopkeepers.”); Hogue v. Port of Seattle, 341 P.2d 171, 187

(Wash. 1959) (invalidating condemnation of residential property so that

agency could “devote it to what it considers a higher and better

economic use”); In re Petition of Seattle, 638 P.2d 549, 556-57 (Wash.

1981) (disallowing plan to use eminent domain to build retail shopping

center, where purpose was not elimination of blight). The Michigan

Supreme Court is being asked in County of Wayne v. Hathcock, 2003 WL

1950233 (Mich. Ct. App. Apr. 24, 2003), app. granted, 671 N.W.2d 40

(Mich. 2003), to reconsider Poletown Neighborhood Council v. City of

Detroit, 304 N.W.2d 455 (Mich. 1981), which upheld the condemnation

of the homes of 4200 people, sixteen churches, and a “historic, racially

integrated community” in order to transfer the land to General Motors

for the construction of a new factory. See Ilya Somin, Michigan Should

Alter Property Grab Rules, Det. News, Jan. 8, 2004, § A, at 11.

9

hotel or like improvement he contemplated erect-

ing or establishing would result in benefit to the

public, and under this rule the property of the

citizen would never be safe from invasion.

Prestonia Area Neighborhood Ass’n v. Abramson, 797

S.W.2d 708, 711 (Ky. 1990) (quotation omitted).

B. The judgment below conflicts with deci-

sions by the Seventh and Ninth Circuits.

The Nevada Supreme Court’s validation of the trans-

fer of condemned property to private commercial interests

to alleviate “downward trends in the business community,”

Pet. App. at 20a, conflicts with decisions by the Seventh

and Ninth Circuits holding that the Public Use Clause sets

clear limits on the power of eminent domain.

Both the Seventh and Ninth Circuits emphasized that

courts cannot simply rubber stamp assertions of public use

put forward by condemning authorities. Daniels, 306 F.3d

at 461-62; Armendariz, 75 F.3d at 1320-21. The Ninth

Circuit held that the judicial branch must prevent takings

that are not “for a ‘public use,’ as the Fifth Amendment

requires, but rather for the use of another private person.”

Armendariz, 75 F.3d at 1321. Similarly, the Seventh

Circuit concluded that the Public Use Clause does not

permit takings whose main purpose is “to confer a private

benefit” on business interests in a case where “any specu-

lative public benefit would be incidental at best.” Daniels,

306 F.3d at 465.

Courts ordinarily accord great deference to legislative

determinations of public use. Such determinations are

upheld so long as they are “rationally related to a conceiv-

able public purpose” and are not “palpably without a

reasonable foundation.” Midkiff, 467 U.S. at 241. The

Seventh and Ninth Circuits have held, however, that such

broad deference is not warranted where the putative

10

public use is offered only to rationalize a condemnation

after the fact.

In Armendariz v. Penman, 75 F.3d 1311 (9th Cir. 1996)

(en banc), owners of low income housing alleged that the

City of San Bernardino sought to condemn their property

to build a privately owned shopping mall. Jd. at 1314-15,

1321. The City claimed that it sought to serve the public

purpose of “the reduction of urban blight.” Jd. at 1314. The

Ninth Circuit refused to defer to the City’s assertion

because “the Takings Clause would lose all power to

restrain government takings” if officials “could take

private property ... simply by deciding behind closed

doors that some other use of the property would be a

‘public use,’” and “later justify their decisions in court” by

concocting “‘a conceivable public purpose’ to which the

taking is rationally related.” Jd. at 1321.

In Daniels v. Area Plan Comm'n, 306 F.3d 445 (7th

Cir. 2002), the Area Plan Commission of Allen County,

Indiana, sought to condemn property in a neighborhood

restricted by common covenant to residential uses and to

transfer ownership to a private developer to construct a

shopping center. The Seventh Circuit invalidated the

taking because the Area Plan Commission failed to show

at the time of the taking that the proposed “commercial

development in and of itself would serve some overriding

public purpose.” Jd. at 465. The Commission’s post hoc

determination that the condemnation might serve a

“conceivable public purpose” did not deserve full deference

under Midkiff. Id. at 465-66 (emphasis in original) (quota-

tion omitted). “Much like the value of the property taken,

‘public use’ is to be determined at the time of the taking,

and at the time of the taking of the restrictive covenant,

11

the possible future commercial development could not be

rationally described as for a public purpose.” Id. at 465.”

Just so here, where the elimination of blight was only

asserted after the fact. As Justice Leavitt pointed out

below, “there was no evidence of blight in or around the

Pappases’ property.” Pappas, Pet. App. at 32a (Leavitt, J.,

dissenting). Neither the Redevelopment Agreement that

led to the condemnation of Petitioners’ property nor the

1986 survey on which that agreement was based even

mentions the presence of blight in the relevant downtown

area. Pet. Cert. at 4-5, 10. According to the trial court,

“none of the block surveys” used by the Redevelopment

Agency to justify the taking of the Pappases’ property

“indicate any findings of blight.” Pet. App. 47a. Likewise,

there is nothing in the record to indicate that the Redevel-

opment Agency made any specific findings of blight in

1993 when it decided to condemn Petitioners’ property.

Pet. Cert. at 10-11.° Indeed, even some members of the

* As in Daniels, 306 F.3d at 460-61, the failure to find blight at the

inception deprived the Downtown Redevelopment Agency of its

statutory authority to condemn Petitioners’ property. Under Nevada

law, eminent domain can only be used to alleviate blight in a “blighted

area, the redevelopment of which is necessary to effectuate the public

purposes.” NEV. REV. STAT. § 279.586(1)(a) (West 2003). Furthermore,

Petitioners’ property was not contiguous with the rest of the redevelop-

ment area, and the condemning authority must show that “noncontigu-

ous areas of a redevelopment area are blighted or necessary for effective

redevelopment” prior to adopting a redevelopment plan. NEv. REV.

STAT. § 279.586(1)(f) (2003). The Redevelopment Agency did not make

any such showings prior to adopting its redevelopment plan and thus

acted ultra vires in condemning Petitioners’ property. See Pet. App. at

31a, 32a (Leavitt, J., dissenting).

* The 1986 Redevelopment Plan gave the Agency the generalized

power to “eliminate blight.” Pet. App. at 48a. However, that authoriza-

tion does not alter the fact thdt there was no finding of blight in the

area, and therefore no blight to “eliminate.” Jd.

12

LLC have conceded that there was no blight in the area.

Id. at 11.

The assertion that condemning Petitioners’ property

would alleviate blight was only advanced by the Redevel-

opment Agency as a litigation position after the fact. The

Nevada Supreme Court’s decision to relieve the Agency of

any meaningful obligation to show the validity of this

asserted public use cannot be squared with Armendariz

and Daniels.

The Redevelopment Agency’s blight rationale was not

only advanced after the fact, it was also a mere pretext for

a condemnation intended to benefit private business

interests. Even many of the casino owners who stand to

benefit from the condemnation of the Pappases’ property

concede that there is no evidence to support the proposi-

tion that downtown Las Vegas is blighted. Pet. Cert. 11.

The trial court found that the Redevelopment Agency had

“turned over all control” of the eminent domain process to

the LLC casino interests. Pet. App. 10la. The Pappases

presented evidence that “the Agency was acting as a front

for the LLC.” Id. at 95a.’ Thus, the LLC’s private interests,

not any determination of public use, led to the condemna-

tion of Petitioners’ property.

In Armendariz, the Ninth Circuit held that Midkiff

did not require deference to the City of San Bernardino’s

"In an analogous case, the Illinois Supreme Court recently

invalidated a condemnation to build a racetrack parking lot because the

condemning authority’s “true intentions were to act as a default broker

of land for [the track owner’s] proposed parking plan.” SWIDA, 768

N.E.2d at 10. The condemning agency in SWIDA had agreed to con-

demn “whatever land” the racetrack owners “desired” for the parking

lot. Id. These facts echo the Redevelopment Agency’s willingness to turn

over “all control” of the condemnation process to the LLC. Pet. App. at

101a.

13

claim that its actions served the public purpose of alleviat-

ing “blight” because the property owners had presented

evidence indicating that this rationale was a mere pretext

for “a scheme ... to deprive the plaintiffs of their property

. .. SO a Shopping-center developer could buy [it] at a lower

price.” Armendariz, 75 F.3d at 1321. A primarily pretex-

tual claim of public use does not deserve deference because

it cannot be considered a true “legislat[ive] judgment of

what constitutes a public use,” but is rather a mere cover

for condemnations designed to benefit private interests.

Midkiff, 467 U.S. at 240. Numerous state courts have also

refused to defer to condemning authorities in cases where

the asserted public use was pretextual.®

* See, e.g., Denver W. Metro. Dist. v. Geudner, 786 P.2d 434, 436-37

(Colo. App. 1989) (finding that flood control was a pretext for enabling

sale of government property); Avalonbay Cmtys., Inc. v. Town of Orange,

775 A.2d 284, 299-303 (Conn. 2001) (upholding injunction against

condemnation of private property allegedly to alleviate blight because it

was a pretext to preventing the construction of affordable housing);

Wilmington Parking Auth. v. Land with Improvements, 521 A.2d 227,

232-34 (Del. 1986) (finding parking construction was a pretext for

extending benefit to private party); City of Miami v. Wolfe, 150 So.2d

489, 490 (Fla. App. 1963) (affirming finding that extending roadway

was a pretext for the acquisition of valuable riparian rights); Earth

Mgmt., Inc. v. Heard County, 283 S.E.2d 455, 460-61 (Ga. 1981)

(blocking condemnation nominally for a park but actually intended to

prevent construction of waste disposal site); Pheasant Ridge Ass’n v.

Town of Burlington, 506 N.E.2d 1152, 1157 (Mass. 1987) (holding that

the construction of a park and moderate income housing was a pretext

for excluding low income housing); Casino Reinvestment Dev. Auth. v.

Banin, 727 A.2d 102, 103-05 (N.J. Super. Ct. Law Div. 1998) (rejecting

pretextual taking intended to benefit casino owned by Donald Trump);

Essex Fells v. Kessler Inst., 673 A.2d 856, 858 (N.J. Super. Ct. Law Div.

1995) (disallowing borough from condemning property in order to

prevent owner from constructing a nursing facility); Redev. Auth. v.

Owners, 274 A.2d 244, 252 (Pa. Cmmw. Ct. 1971) (finding land taken on

pretext of removing blight was actually to benefit another private

party).

14

Three United States district courts have recently

relied on Armendariz and refused to defer to pretextual

takings that transfer condemned property to private

interests.” In all three cases, courts refused deference to a

condemnation where the government claimed that expro-

priation was necessary to alleviate or prevent blight.

Aaron, 269 F.Supp. 2d at 1174-76; Cottonwood, 218

F. Supp. 2d at 1229-30; 99 Cents, 237 F. Supp. 2d at 1229.

A pretextual claim of blight cannot be allowed to justify a

taking whose true purpose was “the desire to achieve the

naked transfer of property from one private party to

another.” 99 Cents, 237 F. Supp. 2d at 1129.

The question of pretext is distinct from that of a post

hoc claim, because a pretextual justification is invalid even

if asserted prior to or concurrent with the condemnation.

See, e.g., Aaron, 269 F.Supp. 2d at 1174-76 (rejecting

pretextual justification asserted in advance). Conversely, a

post hoc assertion of public use is not entitled to deference

even if it is not purely pretextual. See, e.g., Daniels, 306

F.3d at 461-66. Where, as here, a pretextual justification is

presented after the fact, the wrong is doubly compounded.

The Nevada Supreme Court’s deference to the Rede-

velopment Agency’ public use assertion despite the

evidence of pretext stands in conflict with the teaching of

* See Aaron v. Target Corp., 269 F. Supp. 2d 1162, 1174-76 (E.D.

Mo. 2003), rev’d on other grounds, 2004 WL 190439 (8th Cir. Feb. 3,

2004) (holding that a property owner was likely to prevail on a claim

that a taking ostensibly to alleviate blight was actually intended to

serve the interests of the Target Corporation); Cottonwood Christian

Ctr. v. Cypress Redev. Agency, 218 F. Supp. 2d 1203, 1229 (C.D. Cal.

2002); (“Courts must look beyond the government’s purported public

use to determine whether that is the genuine reason or if it is merely

pretext.”); 99 Cents Only Stores v. Lancaster Redev. Agency, 237

F. Supp. 2d 1123, 1129 (C.D. Cal. 2001), app. dismissed as moot, 2003

WL 932421 (9th Cir. Mar. 7, 2003) (“No judicial deference is required

... where the ostensible public use is demonstrably pretextual.”).

15

Armendariz and its progeny that Midkiff provides no

license for the pretense of public purpose to cloak private

greed.

II. The decision below misinterprets Berman v.

Parker, 348 U.S. 26 (1954), to allow condemna-

tion to alleviate “blight” even absent slum-

like conditions, and thus conflicts with the

Supreme Judicial Court of Massachusetts.

In Berman v. Parker, this Court held that condemna-

tions adopted for the purpose of eliminating “slums” do not

violate the Public Use Clause. Berman, 348 U.S. at 32-35.

Although the Court held that “when the legislature has

spoken, the public interest has been declared in terms

well-nigh conclusive,” it also made clear that such defer-

ence to condemning authorities is only appropriate when

the state adheres to “specific constitutional limitations.”

Id. at 32. Thus, the Berman Court emphatically did not

sanction an unlimited power to designate property as

blighted and then condemn it for the purpose of transfer-

ring it to private interests.

The area designated for redevelopment and the use of

the eminent domain power in Berman was characterized

by “[mJiserable and disreputable housing conditions.” Id.

Surveys demonstrated that “64.3% of the dwellings [in the

area] were beyond repair, 18.4% needed major repairs,

only 17.3% were satisfactory; 57.8% of the dwellings had

outside toilets, 60.3% had no baths, 29.3% lacked electric-

ity, 82.2% had no wash basins or laundry tubs, [and] 83.8%

lacked central heating.” Jd. at 30. Such conditions are a far

cry from the mere “relocation of existing businesses

outside of the community, business failures, and loss of

sales or visitor volumes” that were considered sufficient to

declare an area blighted in Pappas. Pet. App. at 20a.

16

Although the Berman Court, in dicta, noted that the

legislature may seek to make the “community ... beauti-

ful as well as healthy, spacious as well as clean,” it did not

hold that purely esthetic or economic gains are by them-

selves sufficient to justify the use of condemnation for the

alleged purpose of alleviating blight. Berman, 348 U.S. at

33. Instead, it limited itself to considering the use of

eminent domain to revitalize areas that are characterized

by persistent “slum” conditions, “as though possessed of a

congenital disease.” Id. at 34.

The court below interpreted Berman to allow the use

of condemnation to address “blight” that falls far short of

the slum-like conditions addressed in this Court’s prece-

dent. According to the Nevada court, Berman permits the

condemnation of property for the alleged purpose of

removing “blight” any time a condemnation is intended to

remove “physical, social or economic conditions that affect

the health, safety or welfare of a community.” Pet. App.

19a, 20a. The court held that “economic blight” sufficient

to justify condemnation of property for transfer to private

parties exists in any area that has experienced “downward

trends in the business community, relocation of existing

businesses outside of the community, business failures,

and loss of sales or visitor volumes.” Jd. at 20a.

The decision below stretched the definition of “blight”

so far that it bears little if any resemblance to the

“(mJiserable and disreputable housing conditions” present

in the Washington, D.C. neighborhood at issue in Berman,

348 U.S. at 32. The trial court below found that there was

no evidence of blight or slum-like conditions in any part of

the downtown area covered by the Redevelopment Plan.

“(Nlone of the block surveys completed by the City, and

submitted to [the trial] Court, indicate any findings of

blight.” Pet. App. at 47a. The only evidence of blight cited

by the Nevada Supreme Court was that the downtown

area suffered from “higher crime rates than the rest of the

City of Las Vegas,” that there were some vacant buildings

17

in the area, and that there had been a reduction in eco-

nomic activity. Pet. App. at 22a. Even if true, these claims

fall well short of the slum conditions present in Berman.

Virtually any area occasionally experiences declining

business conditions, has at least a few vacant lots, and

might have higher crime rates than some other parts of

the city in which it is located. There are numerous reme-

dies for such difficulties that do not require resort to the

drastic compulsion of the power of eminent domain.”

Indeed, the higher crime rates in downtown Las Vegas

relative to the rest of the city may well be explained by the

presence of casino businesses in the area. Cf. Greater New

Orleans Broad. Ass’n v. United States, 527 U.S. 173, 185-

86 (1994) (noting asserted: causal connection between

“legalized gambling” and “street, white-collar, and organ-

ized crime”). If so, it is ironic that the Redevelopment

Agency plans to alleviate these conditions by building a

parking lot intended to increase gambling activity.

In validating the condemnation of Petitioners’ prop-

erty based on its highly elastic definition of blight, the

Nevada Supreme Court created a conflict with Opinion of

the Justices, 126 N.E.2d 795 (Mass. 1955). In that case,

the Massachusetts legislature sought to authorize

condemnation to alleviate “economic blight” in an area

that lacked slum-like conditions because it would improve

“economic well-being,” keep up property values, and

reduce crime. Id. at 803; cf. Hogue v. Port of Seattle, 341

P.2d 171, 184-87 (Wash. 1959) (en banc) (citing Opinion of

the Justices to invalidate a taking where the area in

question was not a “slum or blighted area”). Interpreting

° See, e.g., GEORGE L. KELLING & CATHERINE L. COLES, FIXING

BROKEN WINDOWS: RESTORING ORDER AND REDUCING CRIME IN OUR

COMMUNITIES (1998) (describing numerous low cost ways to reduce

crime).

\

18

the Massachusetts Constitution in light of the Berman

federal public use standard, the Supreme Judicial Court

held that the proposed legislation was unconstitutional

because “there is no suggestion that the area is now a

slum.” Jd. The court specifically distinguished Berman

because “[t]he project is not a slum clearance one, and the

principle on which rest such cases as ... Berman v.

Parker, 348 U.S. 26, is not applicable.” Jd.”

III. The decision below is incompatible with this

Court’s case law granting protection to con-

stitutional property rights equal to that ac-

corded to other individual rights.

This Court has emphasized that protection of property

rights is essential to liberty more generally because “a

fundamental interdependence exists between the personal

right to liberty and the personal right in property. Neither

could have meaning without the other.” Lynch v. House-

hold Fin. Corp., 405 U.S. 538, 552 (1972); see also JAMES

W. ELY, THE GUARDIAN OF EVERY OTHER RIGHT: A CONSTI-

TUTIONAL HISTORY OF PROPERTY RIGHTS (1992) (describing

history of the longstanding American commitment tv

property as a vital constitutional right and a bulwark of

individual liberty more generally); RICHARD PIPES, PROP-

ERTY AND FREEDOM (1999) (presenting evidence of connec-

tion between protection of property rights and individual

freedom in societies around the world).

” Although the Massachusetts court was interpreting its own state

constitution, it nevertheless addressed a federal constitutional issue

because the Court’s interpretation of the Massachusetts state Takings

Clause was dependent on Berman’s analysis of the Fifth Amendment.

Opinion of the Justices, 126 N.E.2d at 803.

19

That is so because, in the words of Justice John

Marshall Harlan, “[d]ue protection of the rights of prop-

erty has been regarded as a vital principle of republican

institutions.” Chicago, Burlington & Quincy R.R., 166 U.S.

at 235. The Framers gave paramount importance to

property rights because “property ownership was closely

associated with liberty” and a crucial “buffer protecting

individuals from governmental coercion.” ELy, THE GUARD-

IAN OF EVERY OTHER RIGHT at 43.

The decision below contradicts this Court’s commit-

ment to full constitutional protection for property rights.

Virtually any property could be condemned and trans-

ferred to other private interests under the elastic defini-

tion of “blight” adopted below. Giving government

unlimited power to define away a constitutional right is

the furthest possible departure from protecting that right

on a par with other constitutional liberties.

Te be sure, property rights continue to have some

protection even under the decision below because owners

are entitled to monetary compensation.” However,

compensation itself does not adequately protect property

rights because it converts them to mere “liability rules,”

under which government may confiscate an individual’s

rights so long as it is willing to pay a price for the privilege

of doing so. See Guido Calabresi & A. Douglas Melamed,

Property Rules, Liability Rules, and Inalienability Rules:

One View of the Cathedral, 85 Herv. L. Rev. 1089 (1972)

(distinguishing true property rights .-om mere liability

protections). The owner’s “right to enjoy property without

* Such compensation often falls far below the true value of the

property right to the owner. See, e.g., RICHARD A. EPSTEIN, TAKINGS:

PRIVATE PROPERTY AND THE POWER OF EMINENT DOMAIN 51-56 (1985)

(discussing types of losses to property owners that are usually ignored

in compensation calculations).

20

unlawful ‘deprivation,” Lynch, 405 U.S. at 552, thus

becomes nothing more than a mere liability entitlement

subject to state-mandated transfer or destruction at any

time.

Amici do not urge this Court to apply to the Public

Use Clause the same tests that protect other constitu-

tional rights. We submit, however, that the approach

adopted by the Nevada Supreme Court has eviscerated the

Public Use Clause of any meaning. “State courts, like

federal courts, have a constitutional obligation to safe-

guard personal liberties,” Stone v. Powell, 428 U.S. 465,

494 n.35 (1976), a duty that the court below has abdicated

by ignoring the fact that “the question [of] what is a public

use is a judicial one.” City of Cincinnati v. Vester, 281 U.S.

439, 446 (1930).

CONCLUSION

For the foregoing reasons, the Court should grant the

petition for a writ of certiorari.

Respectfully submitted,

ILYA SOMIN VIET D. DINH

GEORGE MASON UNIV. (Counsel of Record)

SCHOOL OF LAW BANCROFT ASSOCIATES, PLLC

3301 N. Fairfax Drive 2121 Bancroft Place, N.W.

Arlington, VA 22201 Washington, D.C. 20008

(703) 993-8069 (202) 662-9324

February 6, 2004 Counsel for Amici