United States Court of Appeals for the Federal Circuit
2007-5153
CASITAS MUNICIPAL WATER DISTRICT,
Plaintiff-Appellant,
v.
UNITED STATES,
Defendant-Appellee.
Katherine J. Barton, Attorney, Appellate Section, Environment & Natural
Resources Division, United States Department of Justice, of Washington, DC, filed a
combined petition for panel rehearing and rehearing en banc for defendant-appellee.
With her on the petition was Ronald J. Tenpas, Assistant Attorney General.
Roger J. Marzulla, Marzulla Law, of Washington, DC, filed a response to the
petition for plaintiff-appellant. With him on the response was Nancie G. Marzulla.
Tara L. Mueller, Deputy Attorney General, California Office of the Attorney
General, of Oakland, California, for amicus curiae California State Water Resources
Control Board. With her on the brief was Clifford T. Lee, Deputy Attorney General, of
San Francisco, California.
Robert S. Nicksin, O’Melveny & Myers LLP, of Los Angeles, California, for
amicus curiae California Trout, Inc.
John D. Echeverria, Georgetown Environmental Law & Policy Institute,
Georgetown University Law Center, of Washington, DC, for amicus curiae Natural
Resources Defense Council. Of counsel on the brief was Katherine S. Poole, Natural
Resources Defense Council, of San Francisco, California.
David R. Owen, University of Maine School of Law, of Portland, Maine, for amici
curiae Law Professors (Robert W. Adler, et al.). With him on the brief was Joseph L.
Sax, of Berkeley, California.
Craig Holt Segall, Sierra Club Environmental Law Program, of San Francisco,
California, for amici curiae Defenders of Wildlife, et al.
Ellison Folk, Shute, Mihaly & Weinberger LLP, of San Francisco, California, for
amici curiae Fisheries Scientists (Kozmo Bates, et al.). With him on the brief was
Matthew D. Zinn.
Jeffrey Bossert Clark, Kirkland & Ellis LLP, of Washington, DC, for amici curiae
Tulare Lake Basin Water Storage District, et al. With him on the brief was Scott M.
Abeles. Of counsel on the brief was William C. Kuhs, Kuhs & Parker, of Bakersfield,
California.
Appealed from: United States Court of Federal Claims
Senior Judge John P. Wiese
United States Court of Appeals for the Federal Circuit
2007-5153
CASITAS MUNICIPAL WATER DISTRICT,
Plaintiff-Appellant,
v.
UNITED STATES,
Defendant-Appellee,
Appeal from the United States Court of Federal Claims in case no. 05-CV-168, Senior
Judge John P. Wiese.
ON PETITION FOR PANEL REHEARING
AND REHEARING EN BANC
Before MICHEL, Chief Judge, NEWMAN, MAYER, LOURIE, RADER, SCHALL,
BRYSON, GAJARSA, LINN, DYK, PROST, and MOORE, Circuit Judges.
PER CURIAM.
MOORE, Circuit Judge, with whom RADER and SCHALL, Circuit Judges, join, concurs
in the denial of the petition for rehearing en banc. GAJARSA, Circuit Judge, with whom
MICHEL, Chief Judge, and DYK, Circuit Judge, join, dissents from the denial of the
petition for rehearing en banc. LINN, Circuit Judge, dissents.
ORDER
A combined petition for panel rehearing and rehearing en banc was filed by the
Appellee, and a response thereto was invited by the court and filed by the Appellant.
The court granted the motions of California State Water Resources Control Board,
California Trout, Inc., Natural Resources Defense Council, Law Professors Robert W.
Adler, et al., Defenders of Wildlife et al., Fisheries Scientists Kozmo Bates, et al., and
Tulare Lake Basin Water Storage District et al. for leave to file briefs as amici curiae.
The petition for rehearing was referred to the panel that heard the appeal, and
thereafter the petition for rehearing en banc, response, and the amici curiae briefs were
referred to the circuit judges who are authorized to request a poll whether to rehear the
appeal en banc. A poll was requested, taken, and failed.
Upon consideration thereof,
IT IS ORDERED THAT:
(1) The petition for panel rehearing is denied.
(2) The petition for rehearing en banc is denied.
(3) The mandate of the court will issue on February 24, 2009.
FOR THE COURT
February 17, 2009 /s/ Jan Horbaly______
Date Jan Horbaly
Clerk
cc: Roger J. Marzulla, Esq.
Katherine J. Barton, Esq.
Tara L. Mueller, Esq.
Robert S. Nicksin, Esq.
John D. Echeverria, Esq.
David R. Owen, Esq.
Craig Holt Segall, Esq.
Ellison Folk, Esq.
Jeffrey Bossert Clark, Esq.
2007-5153 2
United States Court of Appeals for the Federal Circuit
2007-5153
CASITAS MUNICIPAL WATER DISTRICT,
Plaintiff-Appellant,
v.
UNITED STATES,
Defendant-Appellee,
Appeal from the United States Court of Federal Claims in Case No. 05-CV-168, Senior
Judge John P. Wiese.
MOORE, Circuit Judge, with whom RADER and SCHALL, Circuit Judges, join,
concurring.
I concur in the decision of the court not to rehear this case en banc. This case,
as it was presented to us in this appeal, is one in which a physical, not a regulatory,
taking analysis ought to apply. For the purposes of the summary judgment ruling on
appeal, the government conceded (1) that Casitas had a property right in the water
diverted from the Ventura River, and (2) that the government required Casitas to build
and operate the fish ladder in such a way as to permanently appropriate water in which
Casitas had the conceded property right. To the extent that the facts may be in dispute,
Casitas’ version of the facts must be taken as true because the government was the
moving party. In view of these facts, it is clear that the government has not merely
burdened, impounded, restricted in use, temporarily impaired, or otherwise regulated
Casitas’ water. Rather, it has appropriated it, and where, as here, the government
action is “the functional equivalent of a practical ouster of the owner’s possession,” a
physical takings analysis is appropriate. Lingle v. Chevron U.S.A. Inc., 544 U.S. 528,
537 (2005).
For purposes of the decision below, and this appeal, the government conceded
that Casitas’ right to divert annually 107,800 acre-feet of water is part of its property
right. Def.’s Reply Supp. Mot. Partial Summ. J. at 3-4 (“Plaintiff [characterizes its
property interest] in its opposition brief [as follows]: ‘In this case, Casitas claims the right
to divert through the Ventura River Project 107,800 acre-feet of water from the Ventura
River per year and the right to put 28,500 acre-feet of water to beneficial use each year
. . . .’ [I]n order to streamline this summary judgment process, and to avoid any
unnecessary confusion in the resolution of the nature or type of taking at issue in this
case (i.e., physical or regulatory) defendant will assume for purposes of this motion that
plaintiff’s characterization of the scope of its property interests is correct.”). 1 Casitas
diverts its water from behind the Robles Diversion Dam in the Ventura River and into
the Robles-Casitas Canal, where it then flows to Lake Casitas.
Furthermore, for the purposes of the decision below, and this appeal, the
government conceded that it required Casitas to comply with the biological opinion.
Appellee’s Brief at 22 n.6 (“Reclamation never required Casitas to install the fish ladder
or comply with the operating criteria in the BiOp. For the purposes of this appeal from
the CFC’s summary judgment rulings, however, the United States assumes at this stage
1
Because of the government’s concession, the majority did not undertake
to decide if, under California Law, there can be a right to divert water. Nor did we
undertake to reach a factual conclusion about whether Casitas will experience a
reduction in the amount of water that it can beneficially use. These concerns and others
are undoubtedly critical to the ultimate outcome of Casitas’ action, but they are not
before us in this appeal.
2007-5153 2
of the proceedings that Casitas’ factual allegation [that Casitas indeed was required to
build the fish ladder and comply with the BiOp] is correct.”). The biological opinion
describes diverting water to create flow through the fish ladder. Of course, the fish
ladder cannot become operational as required by the biological opinion unless it is
provided with water. That water, as the government admitted in oral argument, comes
out of the Casitas-Robles Canal. Oral Argument at 30:28-31:30, referencing id. at 5:20-
6:35, 10:10-10:57. In other words, the water for the fish ladder comes out of Casitas’
allotment of 107,800 acre-feet per year. That is so because, once the water is in the
canal, it is water that Casitas has diverted pursuant to its allotment. It thus has become
the property of Casitas. The operation of the fish ladder diversion works thus takes
property of Casitas. The government does not explain how the fish ladder can be
operated if water is merely left in the Ventura River. Nor does it explain how the fish
ladder could be operated with then-existing water flows. Nor is there a distinction
between some water that must remain in the Ventura River and the water needed for
the fish ladder. Casitas’ explanation of the pertinent facts was clear and undisputed,
and regardless, ought to be taken as true because the government was the moving
party in the summary judgment motion now on appeal.
In light of the aforementioned facts, it is readily apparent that the government
“t[ook] property from A and g[ave] it to B.” Eastern Enters v. Apfel, 524 U.S. 498, 523
(1998) (citing Calder v. Bull, 3 Dall. 386, 388 (1798)). The dissent analogizes the
situation in Casitas to that in Pennsylvania Coal v. Mahon, where the Court held that a
statute restricting the mining of coal constituted a regulatory taking. 260 U.S. 393, 415
(1922). Mahon does not control this case because in Mahon, the government did not
2007-5153 3
physically appropriate the coal. Rather, it preserved the status quo by leaving the coal
in the ground. 2 As the Court explained in Lingle v. Chevron U.S.A. Inc., a physical
takings analysis is appropriate where there is “direct government appropriation or
physical invasion of private property.” 544 U.S. 528, 537 (2005) (further explaining that
physical takings analysis is appropriate where the government action is the “functional
equivalent of a practical ouster of the owner’s possession”). In Casitas, the government
changed the status quo by irrevocably appropriating Casitas’ water and sending it down
the fish ladder where Casitas could not recover it.
The dissent also relies on Tahoe-Sierra Preservation Council v. Tahoe Regional
Planning Activity, 535 U.S. 302 (2002). Tahoe-Sierra concerns a taking claim arising
from the application of a temporary moratorium on land development. The Court held
that such a temporary moratorium did not constitute a per se taking because “[l]ogically,
a fee simple estate cannot be rendered valueless by a temporary prohibition on
economic use, because the property will recover value as soon as the prohibition is
2
Furthermore, the Court in Mahon was not presented with the issue of
whether a taking was a physical or regulatory taking, nor was the Court presented with
the issue of water diversion. The dispute in Mahon was whether the Kohler Act
represented an exercise of eminent domain at all, or rather an uncompensable exercise
of the police power. See e.g., Keystone Bituminous Coal Ass'n v. DeBenedictis, 480
U.S. 470, 481-84 (explaining Mahon). Mahon is not an apt guide for distinguishing
regulatory takings and physical takings bearing on water rights. To the extent that a
factual analogy between this case and Mahon is relevant, consider that the Kohler Act
did not necessarily require Pennsylvania Coal to “leave in place a pillar of coal to prop
up the surface land” as the dissent asserts. “The statute forbids the mining of anthracite
coal in such way as to cause the subsidence of, among other things, any structure used
as a human habitation.” Mahon, 260 U.S. at 412-13. Counsel for Pennsylvania pointed
out that “[t]he act does not go as far as the Barrier Pillar Act. It contains no provision
requiring any mine owner to leave coal in place. If natural support other than coal in the
pillars be available, or if artificial support be provided, every pound of coal may be
removed from the mines.” Id. at 404-11.
2007-5153 4
lifted.” Id. at 331-32. Tahoe-Sierra does not answer the questions posed by this case.
It did not involve a physical taking claim, and it did not address or purport to cut back on
the Court’s water rights cases. In Tahoe-Sierra, the temporary moratorium at issue
preserved the status quo for 32 months, and then returned the land to its owner. In our
case, the government diverts the water out of the Robles-Casitas Canal and sends it
down the fish ladder to the Ventura River below the Robles Dam. That water will never
flow to Lake Casitas, and it is permanently taken from Casitas.
The dissent further relies on Boise Cascade Corp. v. United States, 296 F.3d
1339, 1354 (Fed. Cir. 2002). I do not disagree that “[t]he governmental protection of
owls in Boise Cascade . . . is not comparable to a governmental authorization to third
parties to utilize property.” Seiber v. United States 364 F.3d 1356, 1367 (Fed. Cir.
2004). But the taking claim in Boise Cascade arose from a district court’s injunction,
requiring that no logging take place without a permit, issued after a juvenile spotted owl
was discovered on Boise’s land. We held, inter alia, that the mere imposition of a
permitting requirement did not give rise to a physical taking under Loretto because “[t]he
government simply imposed a temporary restriction on Boise’s exploitation of certain
natural resources located on its land unless Boise obtained a permit.” As with Tahoe-
Sierra, Boise Cascade does not aid our decision in this case because it concerns a
temporary restriction that preserves the status quo and permanently takes nothing away
from the property owner.
Finally, the dissent analogizes this case to previous ones treating “the prohibition
of surface mining as a potential regulatory taking.” In Stearns Co. v. United States, 396
F.3d 1354, 1358 (Fed. Cir. 2005) and Rith Energy, Inc. v. United States, 247 F.3d 1355,
2007-5153 5
1364 (Fed. Cir. 2001), the takings claims arose from government orders restricting
mining operations. In neither of those cases did the government commandeer any coal
for public use. This is in contrast to our situation, where the government diverted water
away from Casitas for public use, and Casitas could never recapture that water.
Respectfully, we did offer a reason for treating Casitas’ water differently than the
coal, trees, and other property involved in the regulatory takings cases cited by the
dissent. The Supreme Court has repeatedly found water diversions to be physical
takings. International Paper Co. v. United States, 282 U.S. 399 (1931); United States v.
Gerlach Live Stock Co., 339 U.S. 725 (1950); Dugan v. Rank, 372 U.S. 609 (1963). In
each of these cases, the United States physically diverted the water, or caused water to
be diverted away from the plaintiffs’ property. In each of these cases the diverted water
was dedicated to government use or third party use which served a public purpose.
Under the facts of this case as configured on appeal, we are compelled to reach the
same conclusion.
2007-5153 6
United States Court of Appeals for the Federal Circuit
2007-5153
CASITAS MUNICIPAL WATER DISTRICT,
Plaintiff-Appellant,
v.
UNITED STATES,
Defendant-Appellee,
Appeal from the United States Court of Federal Claims in Case No. 05-CV-168, Senior
Judge John P. Wiese.
GAJARSA, Circuit Judge, with whom MICHEL, Chief Judge, and DYK, Circuit Judge,
join, dissenting from denial of petition for rehearing en banc.
For the reasons stated below, I respectfully dissent from the court’s decision to
deny the United States’ petition for rehearing en banc. This denial implicates
fundamental questions regarding takings law. The panel majority’s opinion suggests
that a government action can be construed to be a physical taking even if no physical
proprietary interest has actually been taken by the United States. This is contrary to
present Supreme Court law and contrary to our case law. Accepting this analysis of the
panel majority eliminates the fine distinction and balance that has been established by
the Supreme Court between physical and regulatory takings. Moreover, it eliminates
the ability of the legislature to provide for limited and parsimonious legislation protecting
endangered species.
Supreme Court holdings are clear: in order to have a physical taking, there must
be an appropriative use made of any such property. Eastern Enters v. Apfel, 524 U.S.
498, 523 (1998) (citing Calder v. Bull, 3 Dall. 386, 388 (1798) (“‘It is against all reason
and justice’ to presume that the legislature has been entrusted with the power to enact
‘a law that takes property from A. and gives it to B.’”)). Conversely, if property is merely
restricted in use by a regulation, that is the essence of a regulatory taking. Cf. Loretto v.
Teleprompter Manhattan CATV Corp., 458 U.S 419, 436 (1982) (distinguishing the
physical invasion in that case as “qualitatively more severe than a regulation of the use
of property, even a regulation that imposes affirmative duties on the owner, since the
owner may have no control over the timing, extent, or nature of the invasion”).
Assuming that Casitas does have a property right in the water it is permitted to
divert from the Ventura River above the Robles dam, cf. Amicus Curiae Br. of Cal. St.
Water Resources Control Bd. at 6, 7–8 (identifying and explaining limitations on water
rights under California law), the parties agree that this right is only a right to divert
water. 1 Thus, to the extent that the government has limited Casitas’ property, this
limitation can by definition amount to no more than a burden on Casitas’ usufructuary
right to divert water. 2 Despite Loretto’s recognition that regulations on the use of
property, even those imposing affirmative obligations on property owners, do not
constitute physical takings, the panel majority reached a novel conclusion—a
1
The panel majority and en banc concurrence mistakenly characterize
Casitas’ right to divert water—which the government conceded to be within the scope of
Casitas’ property rights for purposes of summary judgment—as a possessory
ownership right. Such a property right has not at any time been conceded and, indeed,
could not be said to exist under California law.
2
The parties agreed that Casitas has the right to divert 107,800 acre-feet of
water from the river each year, but does not have any other rights with respect to that
water. The diverted water is stored in Lake Casitas and evaporates or is released back
into the river over the Lake Casitas dam; Casitas has an appropriative right to actually
use only 28,500 acre-feet of water per year. The parties also appear to agree that there
has been no taking of the 28,500 acre-feet of water to which Casitas has an
appropriative right.
2007-5153 2
requirement under the Endangered Species Act to leave in a river a minimum amount of
water that is not itself privately owned must be analyzed as a physical taking of a party’s
use of that water. Cf. Nollan v. Cal. Coastal Comm’n, 483 U.S. 825, 831–34 (1987)
(analyzing a land use permit conditioned on the grant of a public easement as a
regulatory taking, even though outright acquisition of the easement by the government
would constitute a physical taking). 3 The panel majority’s legal conclusion impairs and
frustrates the logic applied by the Supreme Court.
Even if Casitas owned the water outright, there would be no basis for the panel
majority’s decision. The legal premise for this case should begin with Penn Central’s
recognition that regulatory takings analysis applies to a government “interference
aris[ing] from some public program adjusting the benefits and burdens of economic life
to promote the common good,” Penn Cent. Transp. Co. v. New York City, 438 U.S. 104,
124 (1978), and conclude with Tahoe Sierra, where the Court based its analysis on the
“longstanding distinction between acquisitions of property for public use, on the one
hand, and regulations prohibiting private uses, on the other,” Tahoe-Sierra Pres.
Council v. Tahoe Reg’l Planning Agency, 535 U.S. 302, 323 (2002). See also id. at 324
n.18 (distinguishing “‘actual taking of possession and control’ of a coal mine” analyzed
as a physical taking, United States v. Pewee Coal Co., 341 U.S. 114, 116 (1951), from
issuance of “a wartime order requiring nonessential gold mines to cease operations”
3
In the instant case, the requirements of the BiOp—that more water remain
in the Ventura River and that Casitas build a fish ladder—were imposed as conditions
for Casitas’ incidental take permit, under which it would not be liable for damage to the
endangered steelhead.
2007-5153 3
analyzed as a regulatory taking, United States v. Central Eureka Mining Co., 357 U.S.
155, 168 (1958)).
Such an approach would be consistent with Supreme Court precedent stretching
back to Pennsylvania Coal v. Mahon, 260 U.S. 393, 415 (1922). In Mahon, a statute
required coal companies to leave in place a pillar of coal to prop up the surface land
above coal mines owned by third parties. The statute destroyed the coal companies’
right to mine the coal contained in the pillars—characterized by the court as “very nearly
the same effect for constitutional purposes as appropriating or destroying [the right],” id.
at 414–15—in favor of the public’s interest in preserving the surface land above the coal
mines. The Supreme Court treated the question as involving a regulatory taking, not a
physical taking: “The general rule at least is that while property may be regulated to a
certain extent, if regulation goes too far it will be recognized as a taking.” Id. at 415.
The Court went on to explain that the question was one “of degree,” not capable of
being “disposed of by general propositions.” Id. at 416. The particular regulation was
held to constitute a taking.
In shaping the factors that go into a regulatory taking, the Supreme Court
expressly relied on Mahon in Penn Central. There, the Court characterized Mahon as
“the leading case for the proposition that a state statute that substantially furthers
important public policies may so frustrate distinct investment-backed expectations as to
amount to a ‘taking.’” Penn Central, 438 U.S. at 127. And in Tahoe-Sierra, the Court
relied extensively on Mahon, which it characterized as the opinion that “gave birth to our
regulatory takings jurisprudence.” 535 U.S. at 325.
2007-5153 4
The panel majority offers no convincing reason for approaching this case
differently from Mahon. Casitas alleged a property right to the consumptive use of the
diverted water that is similar to the right the coal companies had to mine the pillars of
coal that were propping up the surface land in Mahon. Both Casitas’ and the coal
companies’ use rights were frustrated by governmental regulation. But in neither case
did the government appropriate property or convey it to a third party. It is, therefore,
inconsistent with precedent to treat the diversion of water in this case as a physical
taking, given that the Supreme Court treated the limitation on coal use in Mahon as a
regulatory taking.
The panel majority’s analysis here appears contrary as well to many of our own
cases. We have consistently rejected landowners’ claims that species preservation
regulations effect a temporary physical taking because a portion of their property is
exclusively occupied, at least for a period of time, by an endangered species. For
example, we have treated a requirement that a landowner not cut and utilize trees that
are used for owl nesting as a regulatory taking. Boise Cascade Corp. v. United States,
296 F.3d 1339, 1354 (Fed. Cir. 2002). We specifically noted in Seiber v. United States
that “[t]he governmental protection of owls in Boise Cascade . . . is not comparable to a
governmental authorization to third parties to utilize property.” 364 F.3d 1356, 1367
(Fed. Cir. 2004). And we have treated the prohibition of surface mining as a potential
regulatory taking. Stearns Co. v. United States, 396 F.3d 1354, 1358 (Fed. Cir. 2005);
see also Rith Energy, Inc. v. United States, 247 F.3d 1355, 1364 (Fed. Cir. 2001). The
panel majority’s opinion offers no reason for treating water differently than coal or trees
or other property involved in regulatory takings cases.
2007-5153 5
Furthermore, the panel majority’s rationale premised on International Paper Co.
v. United States, 282 U.S. 399 (1931), United States v. Gerlach Livestock Co., 339 U.S.
725 (1950), and Dugan v. Rank, 372 U.S. 609 (1963), does not support a physical
taking analysis here, if those decisions are properly analyzed. In International Paper, all
of the water previously used by the plaintiff to operate its paper mill was requisitioned
for power generation. 282 U.S. at 405–06. In both Gerlach and Dugan, all of the
seasonal flood waters in which landowners adjacent to the San Joaquin River had a
riparian right of use for irrigation of their grasslands were diverted and sold to other
property owners for irrigation. Gerlach, 339 U.S. at 729–30; Dugan, 372 U.S. at 613–
14. These cases do not support the panel majority’s conclusion that this restriction on
the use of Casitas’ property should be analyzed as a physical appropriation rather than
a mere regulatory requirement that less of it be used. Cf. Mahon, 260 U.S. at 414–15;
Keystone Bituminous Coal Ass’n v. DeBenedictis, 480 U.S. 470, 477, 488 n.8 (1987)
(noting that a requirement to leave 50% of subsurface coal unmined “of course, involves
land use regulation, not a physical appropriation of petitioners’ property”). Moreover,
the Supreme Court has clearly proceeded and clarified the distinctions between and
among physical and the various forms of regulatory takings in, for example, Penn
Central, Loretto, Lucas v. South Carolina Coastal Council, 505 U.S. 1003 (1992),
Tahoe-Sierra, and Lingle v. Chevron U.S.A., Inc., 544 U.S. 528 (2005).
The panel majority opinion fails to follow clear Supreme Court and Federal Circuit
precedent. For these reasons, this court should have reconsidered the case en banc.
Failing to do so, I dissent.
2007-5153 6