Will the Supreme Court Overturn the Infamous Takings Decision of Kelo v. City of New London?

Trevor Burrus and Sam Spiegelman

In the infamous case of Kelo v. City of New London, the Supreme Court allowed the city of New London, Connecticut to take Susette Kelo’s little pink house (also the name of a very good movie about the case) via eminent domain for the “public use” of furthering economic development in the town’s Fort Trumbull neighborhood. The fight in that case was over the meaning of the words “public use” in the Fifth Amendment’s Takings Clause, and whether the words provide essentially any limit on what a municipality or legislature says is “public use.” In Kelo, one of the major beneficiaries of the Fort Trumbull redevelopment plan was Pfizer, which received tax breaks from the city to build in the neighborhood. Pfizer never actually built anything, and in 2009 it closed its New London facilities. The land is still vacant, with some residents using it for gardening. A community center is now planned for the land.

Kelo created an understandable backlash, as 45 states passed some sort of reforms (some toothless) to their eminent‐​domain practices in the wake of the decision. But the first backlash came from the four dissenting justices, led by Sandra Day O’Connor, who wrote that the consequences of the Court’s decision would be dire:

Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random. The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms. As for the victims, the government now has license to transfer property from those with fewer resources to those with more.

Fred Eychaner is not exactly someone with few resources, but he still found his land in the crosshairs of Chicago officials who wanted to give it to a politically connected business. His land in the River West neighborhood was two blocks north of the Bloomer Chocolate Company. According to the Eychaner’s petition to the Supreme Court, “to secure Blommer’s support for a zoning change, the City of Chicago condemned Eychaner’s property to give it to Blommer.” Stretching the broad holding of Kelo even further, the city “based the taking on a finding that the area was at risk of future blight.”

Eychaner filed suit in federal court arguing, among other things, that the city’s taking of his property is not for a “public use” as the term was understood in 1791, when the states ratified the Fifth Amendment, or during the subsequent century of judicial interpretation. From the 1790s until the early 20th century, state courts took the lead on takings law and for the most part held the narrow view that “public use” meant ownership by, or access to, the public. Still, a minority of state courts during this period took the broad view that it means anything a legislature determines to be useful to the public.

In the early to mid‐​20th century, however, the Court’s takings jurisprudence transformed. In 1954, in Berman v. Parker, Justice William O. Douglas upheld the District of Columbia’s confiscation of non‐​blighted property as part of a broader anti‐​blight program, declaring that “when the legislature has spoken, the public interest has been declared in terms well nigh conclusive.” Translation: whether something is for a “public use” is to be determined by the legislature, and there are very few legal avenues to challenge the claim that a taking is for the “public use.”

Of course, if a legislature is free to define “public use” without a court’s exacting appraisal of its constitutionality, then, as Justice Clarence Thomas put it in his Kelo dissent, those words become essentially meaningless. This would be contrary to the Court’s longstanding view that all of the Constitution has actionable meaning, and that no words are “hortatory fluff,” as Justice O’Connor put it in her separate Kelo dissent. Berman should have been an outlier, but in 1984, in Hawaii Housing Authority v. Midkiff, the Court doubled down on the basic holding. Then, in Kelo, Justice John Paul Stevens, who later called it the “most unpopular opinion that any member of the Court wrote during” his 34‐​year tenure, misread precedent to uphold Berman and Midkiff, adding that A‐​to‐​B transfers are even permissible for the incredible “public use” of “economic development.”

Cato has filed an amicus brief urging the Supreme Court to take Eychaner’s case and reconsider Kelo. If a legislature’s definition of “public use” is “well nigh conclusive,” then the justification for a taking need not stop at reversing existing blight or promoting economic development, but may, as Chicago argues here, extend to the apparent danger of “future blight.” This is perilous terrain, and the slippery slope is steep. There are a lot of reasons legislatures might want your property, and if they can claim mere potential blight, then no one’s property is safe. Under Kelo, as long as the taking is not pretextual or completely arbitrary, then an eminent‐​domain action that is claimed to be for public use is acceptable, even though it’s just an unconstitutional A‐​to‐​B transfer. This is anathema to both the spirit and words of the Takings Clause, and counsels overturning Kelo before the misguided Berman and Midkiff precedents become even more dangerous.