This issue was already covered here at A Chequer-Board of Nights and Days, but it is worth following up with a link to Ilya Somin’s excellent article concerning Judge Sotomayor’s property rights jurisprudence. Somin takes on the case of Didden v. Village of Port Chester, in which Judge Sotomayor’s appellate court panel extended the Supreme Court’s ruling in Kelo v. City of New London to find that government can condemn property merely because the owners of that property refused to pay what amounted to “extortion money” to a private developer with significant political contacts:
In 1999 the village of Port Chester, N.Y., established a “redevelopment area,” giving designated developer Gregg Wasser a virtual blank check to condemn property within the area. When local property owners Bart Didden and Dominick Bologna sought a permit to build a CVS pharmacy in the area, Wasser demanded that they pay him $800,000 or give him a 50 percent partnership interest in the store, threatening to have their land condemned if they said no. They refused, and a day later the village condemned their property.
Didden and Bologna challenged the condemnation on the ground that it was not for a “public use,” as the Constitution’s Fifth Amendment requires. Their argument was simple and compelling: Extortion for the benefit of a private party is not a public use. In a short, cursory opinion, Sotomayor’s panel upheld the condemnation.
Although based partly on Kelo’s very broad definition of “public use,” the Didden ruling extended the term beyond what Justice John Paul Stevens had in Kelo. In particular, Stevens had noted that “the mere pretext of a public purpose, when its actual purpose was to bestow a private benefit,” was not enough to count as a “public use.” As an example of such an unconstitutional pretextual taking, he cited a case with far less egregious facts than Didden – a California federal court ruling invalidating the condemnation and transfer of a 99 Cents Only store to Costco, rationalized on the ground that Costco might produce more tax revenue and economic growth.
Like the Didden property, the 99 Cents Only store was located in a redevelopment area. But, the rationale for the 99 Cents Only store condemnation and transfer was at least plausible, since the Costco store might have generated more economic activity and hence a public benefit. In Didden, by contrast, there was no plausible public benefit. Didden and Bologna’s land would not have been condemned but for their refusal to pay Wasser the money he demanded. If that isn’t a pretextual taking, it is hard to imagine what is.
How is it possible that so much of mainstream commentary overlooks this radical limitation of property rights, endorsed by Judge Sotomayor? And how can we be assured that similar radical limitations of rights don’t await us in other areas of the law, if Judge Sotomayor is confirmed to the Court?