In the United States Court of Federal Claims
Nos. 14-21L/16-405L (Consolidated)
(Filed: October 18, 2019)
) Keywords: National Trails System
ELLEN AND MARK S. BALAGNA, et ) Act; Trails Act; Rails-to-Trails; 16
al., ) U.S.C. § 1247(d); Takings Clause;
) Duration of the Taking; Notice of
Plaintiffs, ) Interim Trail Use (NITU).
)
v. )
)
THE UNITED STATES OF AMERICA, )
)
Defendant. )
)
)
ROBERT AND SUSAN BATTERTON, )
et al., )
)
Plaintiffs, )
)
v. )
)
THE UNITED STATES OF AMERICA, )
)
Defendant. )
)
OPINION AND ORDER
Meghan S. Largent, Lewis Rice LLC, St. Louis, Missouri, with whom was Lindsay S.C.
Brinton, for Plaintiffs Robert and Susan Batterton, et al.
James H. Hulme, Arent Fox LLP, Washington, D.C., with whom were Abram J. Pafford and
Laurel LaMontagne, for Plaintiffs Ellen and Mark Balagna, et al.
Sarah Izfar, Trial Attorney, Natural Resources Section, Environment and Natural Resources
Division, U.S. Department of Justice, Washington, D.C., with whom was Lawrence Vandyke,
Deputy Assistant Attorney General, for Defendant.
1
KAPLAN, Judge.
Currently before the Court in this rails-to-trails case are the parties’ cross-motions
for partial summary judgment regarding the duration of the taking. See Landowners’
Mot. for Partial Summ. J. Regarding the Duration of the Taking (“Pls. Mot.”), ECF No.
194; United States’ Partial Mot. for Summ. J. Regarding the Duration of Alleged Taking
(“Def. Mot.”), ECF No. 195. 1 For the reasons set forth below, the government’s motion
for partial summary judgment is GRANTED and the Plaintiffs’ motion is DENIED.
BACKGROUND
The Court detailed the facts of these consolidated cases in two earlier opinions on
motions for partial summary judgment. Balagna v. United States (“Balagna I”), 135 Fed.
Cl. 16 (2017); Balagna v. United States (“Balagna II”), 138 Fed. Cl. 398 (2018). To
summarize, Plaintiffs own land abutting a 14.5-mile railroad right-of-way in Fulton
County, Illinois. Balagna I, 135 Fed. Cl. at 18–19. On May 24, 2013 the Surface
Transportation Board (“STB”) issued a Notice of Interim Trail Use (“NITU”) covering
the right-of-way. Id. at 20. After being extended multiple times, the NITU expired on
November 22, 2018 without a trail-use agreement having been reached. See Def. Mot. at
3.
On August 6, 2018, while the final extension of the NITU was in effect, this Court
issued an opinion on the parties’ second set of cross-motions for partial summary
judgment. See Balagna II, 138 Fed. Cl. 398. Those cross-motions concerned, among
1
All citations are to the docket for the lead case, No. 14–21L.
2
other things, whether the takings at issue, then having lasted over five years, should be
treated as temporary or permanent ones. Agreeing with the government, the Court
concluded that unless and until a trail use agreement was reached, the takings should be
treated as temporary and that the measure of compensation should be based on a
methodology appropriate to temporary takings. Id. at 404–05.
Nonetheless, the Court denied as unfair to the Plaintiffs the government’s request
for a stay of the damages determination pending the completion of the negotiations
between the putative trail sponsor and the Railroad. Balagna II, 138 Fed. Cl. at 406–407.
The Court reasoned that the uncertainty about the length of the takings need not preclude
it from fashioning a damages remedy. Id. at 406. It noted that in Ladd v. United States,
108 Fed. Cl. 609, 616 (2012), aff’d in part and rev’d in part, 713 F.3d 648 (Fed. Cir.
2013), for example, the court had suggested that damages could be calculated by having
an appraiser: 1) determine the total value of the temporary taking beginning with the date
that the NITU was issued and ending on the date of any order by the Court, and 2)
develop “a daily factor for determining value at a later date as needed.” Balagna II at 406
(quoting Ladd, 108 Fed. Cl. at 616). Quoting Ladd, the Court suggested that it could
retain jurisdiction to recalculate the value of the temporary taking using the later date
“[i]f or when the Railroad files a Notice of Consummation of Abandonment.” Id.
The parties have been engaged in settlement discussions since the Court issued its
decision on August 6, 2018. In the meantime, as noted, the NITU expired on November
22, 2018. Def. Mot. at 3. On February 4, 2019, the Railroad asked the STB to extend the
sixty-day period for consummating the abandonment of the rail line until January 21,
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2020. Id. at 4. 2 It requested the extension so that it might resolve a condition that the STB
had earlier placed on the consummation of the abandonment under § 106 of the National
Historic Preservation Act, 54 U.S.C. § 306108 (“NHPA”). Id. at 3–4. 3 The STB granted
the Railroad’s request on April 16, 2019. Id. at 4.
On August 9, 2019, the parties advised the Court that they had reached another
impasse in their settlement discussions. Joint Status Report, ECF No. 192. Their
disagreement concerns whether any takings effected upon the NITU’s issuance ended
upon its expiration in November 2018 (as the government argues), or whether such
takings will end only when the Railroad consummates its abandonment of its right-of-
way (as Plaintiffs contend). The parties requested an opportunity to file another set of
cross-motions for partial summary judgment addressed to that issue. The Court granted
the parties’ request, ECF No. 193, and the cross-motions are currently before the Court.
For the reasons set forth below, the Court concludes that the takings ended with
the expiration of the NITU on November 22, 2018. The government’s motion for partial
2
Under 49 C.F.R. § 1152.29(e)(2), a railroad must file a notice of consummation of
abandonment within one year from the date of an STB decision permitting such
abandonment or sixty days from the expiration or removal of the last legal or regulatory
barrier to consummation (in this case, the expiration of the NITU). The Railroad’s notice
was therefore originally due on January 21, 2019. The STB, however, was not accepting
filings at that time because the government was in a partial shutdown between December
22, 2018 and January 25, 2019. Once the shutdown ended, the STB announced that it
would accept filings due during the shutdown period so long as they were submitted by
February 4, 2019. Def. Mot. Ex. 1, at 2.
3
This condition related to a stone arch bridge at milepost 52.86. Id.
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summary judgment regarding the duration of the taking is therefore GRANTED and the
Plaintiffs’ motion is DENIED.
DISCUSSION
It is well established that the operation of the Trails Act 4 leads to a compensable
taking where a plaintiff possesses a “state law reversionary interest[]” in land subject to a
railroad’s right-of-way that is “effectively eliminated in connection with [the] conversion
of [the] railroad right-of-way to trail use.” Caldwell v. United States, 391 F.3d 1226,
1228 (Fed. Cir. 2004) (citing Preseault v. United States, 100 F.3d 1525, 1543 (Fed. Cir.
1996) (en banc)). That taking occurs “when the railroad and trail operator communicate
to the STB their intention to negotiate a trail use agreement and the agency issues an
NITU,” for it is that action which “operates to preclude abandonment [of the railroad
right-of-way] under section 8(d).” Id. at 1233. Put another way, the issuance of the NITU
blocks reversionary property interests and “prevents the landowner[] from
possess[ing] . . . their property unencumbered by the easement.” Ladd v. United States,
630 F.3d 1015, 1023 (Fed. Cir. 2010) (footnote omitted).
Once the NITU expires, however, there is no government action that prevents a
railroad from taking the steps required to consummate its abandonment of the right-of-
way by filing the necessary notice. See Caldwell, 391 F.3d at 1233–34 (observing that
“[t]he issuance of the NITU is the only government action in the railbanking process that
operates to prevent abandonment of the corridor and to preclude the vesting of state law
4
§ 208 of the National Trails System Act Amendments of 1983, Pub. L. No. 98–11, §
208, 97 Stat. 42, 48 (codified at 16 U.S.C. § 1247(d)) (amending § 8 of the National
Trails System Act).
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reversionary interests in the right-of-way.”). Therefore, the taking effected by the NITU’s
issuance ends upon the NITU’s expiration. See Caquelin v. United States, 140 Fed. Cl.
564, 579 (2018), appeal docketed, No. 19-1385 (Fed. Cir. Jan. 9, 2019) (observing that
“the duration and time of the taking is undisputed and uncontroversial” and that “[t]he
taking began on the date the STB issued the NITU and blocked Mrs. Caquelin’s
reversionary interest in the property . . . and ended when the NITU expired”). This is so
notwithstanding that—until the Railroad takes action to consummate the abandonment—
the STB continues to have jurisdiction over the right-of-way, just as it did before the
NITU was issued. See Arnold v. United States, 137 Fed. Cl. 524, 556 (2018) (finding
STB’s decision to grant the railroad extensions of time to consummate abandonment “did
not prevent abandonment of the railroad corridor or preclude the vesting of the property
owner’s reversionary rights under state law”; instead, the railroad’s “decision not to
consummate abandonment and to request four extensions of time for the period in which
[the railroad] has been given to consummate abandonment prevented plaintiffs from
receiving their reversionary rights”); Farmers Coop. Co. v. United States, 100 Fed. Cl.
579, 583 (2011) (explaining that “[i]n a rails-to-trails takings case, the issue is not
whether STB jurisdiction continues or whether the railroad retains a property interest
upon the expiration of a NITU, but whether the Government has taken any action that
forestalls the vesting of the underlying landowners’ property rights”).
Plaintiffs argue that the expiration of the NITU that effected the taking does not
necessarily end the taking because it is conceivable that another NITU will be issued
before the Railroad consummates its abandonment of the right-of-way. Pl. Mot. at 6
(observing that “the fact that the NITU has expired in this case is of no import because
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NITUs are routinely resurrected by the STB in order to implement trail use”). They
observe that in Barclay v. United States, the court of appeals held that where the STB
issued a new NITU several weeks after a prior NITU expired, it did not effect a new
taking but instead “merely extended the original NITU” albeit with a new potential trail
sponsor listed. 443 F.3d 1368, 1376 (Fed. Cir. 2006).
But there is no evidence before the Court showing that another potential trail
sponsor is waiting in the wings or that a resurrection of the now long-expired NITU is
contemplated. To the contrary, the evidence reveals that the Railroad is intent upon
abandoning the line once it resolves the NHPA condition described above. Def. Mot. Ex.
5 (January 11, 2019 letter from the Railroad to Plaintiffs’ Counsel stating that it had “not
received inquiries from any other individual or group” interested in sponsoring the trail
and that the Railroad “intends to move toward consummation of the abandonment”).
Plaintiffs’ citation of Barclay is therefore unavailing. See Landowners’ Reply in Supp. of
Their Mot. for Partial Summ. J. Regarding the Duration of the Taking at 2–5, ECF No.
198.
Finally, Plaintiffs contend that “the methodology for determining damages
proposed in the Court’s published opinion requires the Court to retain jurisdiction.” Pl.
Mot. at 6. This contention lacks merit. The Court cited the methodology used in Ladd,
108 Fed. Cl. 609, as an example of a way that damages could be awarded
notwithstanding that the length of the temporary taking remained uncertain. It did so in
response to the government’s argument that the valuation portion of the case would have
to be put off for an indefinite period of time while the Railroad and the trail sponsor
continued their negotiations (which were then in their sixth year). See Balagna II, 138
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Fed. Cl. at 406. The Court did not intend to make any pronouncements about the duration
of any taking, much less suggest that such takings would continue after the negotiations
ended and the NITU expired, and until the Railroad consummated its abandonment of the
line. Further, the NITU expired a few months after the Court issued its decision, thereby
ending the temporary taking and obviating any reason for it to retain jurisdiction as
contemplated in Ladd, 108 Fed. Cl. 609.
CONCLUSION
For the foregoing reasons, the government’s motion for partial summary
judgment is GRANTED and the Plaintiffs’ cross-motion is DENIED. The parties shall
file a joint status report by December 2, 2019, apprising the Court of the status of their
settlement discussions and proposing further proceedings in these consolidated cases.
IT IS SO ORDERED.
s/ Elaine D. Kaplan
ELAINE D. KAPLAN
Judge
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