[00:00:00] Speaker 01: Our next case for argument is 21-1849, Idecker Farms versus United States. [00:00:09] Speaker 01: Mr. Toth, please proceed. [00:00:11] Speaker 03: Madam Chief Judge, and I please the Court, Brian Toth from the Department of Justice, representing the United States as a Defendant-Appellant in this case. [00:00:19] Speaker 03: Claims court held the United States liable to pay just compensation for taking property [00:00:24] Speaker 03: on plants' property due to changes that the Army Corps of Engineers made to the operation and configuration of the Missouri River and Main Stem Reservoir System and related navigation improvements. [00:00:38] Speaker 03: Those changes had the effect of reducing the flood control protections that the Corps had already been providing the plants on their property. [00:00:47] Speaker 03: did not unequivocally eliminate those benefits altogether, as would be required to establish a taking. [00:00:54] Speaker 03: Claims court erred in a number of respects that we outlined in our brief, but I'd like to focus my presentation on a couple of them here today, namely causation and relative benefits. [00:01:04] Speaker 03: Claims court committed the overarching error of failing to examine the baseline that was appropriate for determining whether a taking has occurred. [00:01:14] Speaker 03: It excluded [00:01:15] Speaker 03: the consideration of what would have occurred absent the system and its improvements altogether. [00:01:21] Speaker 03: Plaintiffs did not even attempt to put on a case of evidence to demonstrate. [00:01:25] Speaker 04: I'm sorry, but that wasn't ignoring the baseline. [00:01:29] Speaker 04: It's just taking a different view of the baseline from the one you have. [00:01:35] Speaker 04: Fair enough. [00:01:35] Speaker 03: It was a rejection of our argument that the proper baseline [00:01:38] Speaker 03: should be set to consider the benefits of the cost. [00:01:41] Speaker 04: And the CFC said the baseline is what existed at the time of the various investments, subject to a question about what the reasonable expectations of alteration were at that time. [00:01:54] Speaker 04: And then finding as a fact that there was no reasonable expectation of the kind of dramatic change in priority [00:02:02] Speaker 04: that occurred in 2004. [00:02:05] Speaker 04: Is that a fair summary, at least, of what the CFC held? [00:02:08] Speaker 03: I think in general, I would quibble a little bit about the role of relative, I'm sorry, expectations in the analysis. [00:02:15] Speaker 03: Causation is a sine qua non for takings liability. [00:02:18] Speaker 03: You saw this in the St. [00:02:19] Speaker 03: Bernard Parish decision. [00:02:20] Speaker 03: Without causation alone, there cannot be a taking. [00:02:24] Speaker 03: Similarly, Alford makes clear that relative benefits is a complete defense to taking apart from any injection of the expectations of the landowners. [00:02:33] Speaker 03: And while Arkansas Game and Fish mentions reasonable investment-backed expectations as a factor in determining whether there is liability for taking by flooding, [00:02:42] Speaker 03: We believe that the mistake that my friend makes and that the claims court also made is that the reasonable expectation of the landowner cannot be injected into the causation analysis for the relative benefits analysis. [00:02:56] Speaker 03: It's analogous, for example, to [00:02:58] Speaker 04: I'm sorry, even if the reasonable expectation is a matter of, is judged objectively and not in a party-specific way. [00:03:06] Speaker 03: That's correct. [00:03:07] Speaker 03: And I would point the Court to this Court's predecessor's decision in the Icardi case where it rejected an argument [00:03:14] Speaker 03: in a taking by flooding context that the landowners were entitled to rely on an undiminished flow. [00:03:21] Speaker 03: It was a project that was relocating a railroad right of way during the, actually that's a different case, it was a [00:03:30] Speaker 03: about the Trinity River division of the Central Valley Project, and the landowners claimed that the flow could not be adjusted upward, even though they were not harmed compared to what occurred before the dam was in place. [00:03:42] Speaker 03: The court rejected the notion that they had expectations. [00:03:48] Speaker 03: So even if it's objectively considered, we don't think reasonable expectations play a role in the causation analysis. [00:03:57] Speaker 03: If they did, however, we don't believe that the expectations here of the landowners were reasonable, such that the original operation of the system should be excluded from the analysis. [00:04:10] Speaker 03: And that's so for a number of reasons. [00:04:13] Speaker 03: Congress enacted a statute in 1944 authorizing the construction and operation of the project specifically to include a number of purposes, not only flood control and navigation, but also fish and wildlife preservation. [00:04:25] Speaker 02: This was clearly the priority and the long-standing priority. [00:04:34] Speaker 03: This meaning flood control? [00:04:35] Speaker 03: Yes. [00:04:36] Speaker 03: It was a top priority. [00:04:37] Speaker 03: And we acknowledge that. [00:04:39] Speaker 03: And that's something that the circuit has held in the multi-district litigation over this project. [00:04:44] Speaker 03: But since the inception of the project, through the statute, and then through repeated enactments and revisions of the manual, the Corps has made clear, well, Congress first made clear that fish and wildlife preservation were a purpose of the project. [00:04:57] Speaker 03: So it's not outside the realm of expectations altogether. [00:05:01] Speaker 03: And then secondly, the manual revisions always make clear that the operations will change based on changes in priority, based on legal policy. [00:05:12] Speaker 03: Certainly the Endangered Species Act enactment is such a change. [00:05:15] Speaker 01: Yes, but how can you argue that the property owners [00:05:19] Speaker 01: should have expected the government to stop prioritizing flood control and instead prioritize endangered species such that they should have acted to lose all their farmland when the government itself didn't think that were the case and in fact fought all the way through the court system whether they should have to make that change. [00:05:39] Speaker 01: you're holding the property owners to a different standard of expectation, even though all of the government people involved fought tooth and nail against that very principle, why should the property owners have understood what the government itself did not? [00:05:54] Speaker 03: I think you have to, if you're going to set aside, if you're going to look at the expectations objectively, I think it's fair to set aside the parties sitting in positions [00:06:07] Speaker 03: Why? [00:06:08] Speaker 01: Why are you setting it aside because it doesn't benefit you in this case? [00:06:11] Speaker 01: Why are you setting it aside? [00:06:12] Speaker 03: No, because I think if you look at it objectively, you would look not to the parties litigating positions in that single set of cases, but you would look to factors like, what would Congress say on the original enactment for various purposes? [00:06:25] Speaker 03: And yes, in 1944, we're not saying that landowners thought to have anticipated that Congress would enact the Endangered Species Act specifically, or that the Corps would be required to rebalance the priorities. [00:06:37] Speaker 03: But certainly, this is a much easier context than I think even St. [00:06:41] Speaker 03: Bernard Parish was, or even Harwick was, because you're talking about [00:06:45] Speaker 03: to a single project, right? [00:06:47] Speaker 03: You're talking about changes to the operation and the configuration of the single project. [00:06:52] Speaker 03: And it's within the ambit of what Congress originally recognized. [00:06:55] Speaker 02: So is there an example? [00:06:57] Speaker 02: I mean, is the government's position that there are no guarantees in life, and therefore there can never be a reasonable expectation? [00:07:04] Speaker 02: Or can you give me an example of what the government would say would have been a reasonable expectation by the landowners here? [00:07:12] Speaker 03: I'm not in a position. [00:07:17] Speaker 03: on the facts in this case, because our position is, because Congress provided the flood control benefits, it wasn't constitutionally compelled to undertake that program. [00:07:28] Speaker 03: And it has had to adjust the operations of various projects like this over time. [00:07:33] Speaker 02: So there can never be a circumstance when it's legislated, when the changes come from Congress, there can never be a circumstance where anyone can rely on that. [00:07:44] Speaker 02: in terms of making their investments, in terms of the resources, even if it lasts for decades, they have no reasonable basis for assuming that will continue as a priority. [00:07:53] Speaker 03: So long as the flooding that occurs on the plant's property that they're complaining about is no worse than what would have occurred [00:08:01] Speaker 03: before the project was constructed or enacted. [00:08:05] Speaker 03: Yes, that's our position. [00:08:06] Speaker 02: And what's your case on that? [00:08:07] Speaker 02: Because St. [00:08:07] Speaker 02: Bernard wasn't precisely, the sequence of events was certainly different here in a way that clearly could have resulted in different results. [00:08:16] Speaker 02: So what's your case here? [00:08:17] Speaker 03: Well, we think the reasoning in St. [00:08:19] Speaker 03: Bernard is logically extended to the situation as well. [00:08:22] Speaker 03: There isn't a precise case. [00:08:23] Speaker 03: To answer your question directly, there isn't a precise case on point, whether on point against us or in our favor. [00:08:30] Speaker 03: But we think the logic here [00:08:31] Speaker 03: is such that where Congress has undertaken this beneficial program [00:08:36] Speaker 03: it cannot be ignored in the takings context. [00:08:39] Speaker 03: Otherwise, the landowners could be able to slice the government's action as thin as they wish to isolate the detrimental aspects of it and its operation from the benefits that they've received for years. [00:08:49] Speaker 03: And that's true whether you look at it through the lens of causation or whether you look at it through the lens of relative benefit. [00:08:55] Speaker 04: But with a, what, 25, 40 plus year difference, we're not really close to a tough case of slicing, are we? [00:09:06] Speaker 03: It has the possibility. [00:09:10] Speaker 03: I'll give you an example. [00:09:12] Speaker 03: The Hurricane Harvey litigation that came before this court is ongoing in the claims court. [00:09:17] Speaker 03: The claims there are made by both upstream and downstream planets of a core project that when the core operated a dam in response to flood events from Tropical Storm Harvey, it closed the gates to hold water behind a dam and then opened the gates to release it at a lower rate than would have occurred if they had not had the project operating at all. [00:09:36] Speaker 03: The plaintiffs in that case are claiming that the opening of the gates caused the taking of property downstream, and they're isolating that opening of the gates during the same storm from the closing of the gates. [00:09:49] Speaker 04: What parties claim doesn't establish a judicial precedent to worry about. [00:10:00] Speaker 03: I understand. [00:10:00] Speaker 03: So maybe I can... [00:10:03] Speaker 04: You're willing to bite the bullet on reflooding Back Bay and Battery in New York City? [00:10:11] Speaker 03: No, I think those examples of approval of dredge and fill permits, which CORE also has a role in, are very different from this, which is the ongoing operation of the project over the course of decades. [00:10:22] Speaker 03: With the filling of Back Bay, the CORE grants a one-time permit, and then its responsibilities are done. [00:10:29] Speaker 03: It authorizes the [00:10:33] Speaker 03: a different development is built upon it. [00:10:37] Speaker 03: And the court has no further role. [00:10:40] Speaker 03: Here, Congress is continuing to find through yearly appropriations or multi-year appropriations the operation of this project. [00:10:46] Speaker 03: And plaintiffs are continuing to receive benefits from it. [00:10:49] Speaker 03: So this is a different situation than the examples that my friend offers in the opposing briefs. [00:10:55] Speaker 03: But I want to get at this from a different angle as well. [00:10:58] Speaker 03: I think the effect of the claims court's ruling here is to give to plaintiffs [00:11:10] Speaker 03: decision turns it into a one-way ratchet such that the benefits accrue to the landowner's property, tied their title to the property, and they become a compensable interest in their property. [00:11:22] Speaker 03: So it's as if the flow of easement here is granted for the Corps to have the rights to diminish the flood control benefits that it's been providing for these decades to these landowners. [00:11:33] Speaker 03: And that's just a very odd way, one, of conceptualizing the Floach-Easman contract. [00:11:38] Speaker 04: Is it a comfort at all to you that what St. [00:11:42] Speaker 04: Bernard said, inaction is not a taking? [00:11:45] Speaker 04: So you could, by inaction, end up having some deprivation of the comparative dryness of the land for which the government would not be responsible. [00:11:59] Speaker 04: This is not an inaction case, and you haven't argued that it is. [00:12:02] Speaker 03: Correct. [00:12:02] Speaker 03: We haven't argued that. [00:12:03] Speaker 03: But the logical implication of that is that it would incentivize the government to walk away from a project that it's got the statutory responsibilities to operate on an ongoing basis. [00:12:13] Speaker 03: There can't be inaction here. [00:12:14] Speaker 03: So we're in a catch-22 because Congress has directed the court to continue operating this project. [00:12:21] Speaker 03: And so the result is that plaintiffs get, under the claims court's ruling, a right to compensation for any enhancement in the flood control benefits of the project without having to accept the detriments that might result when the court needs to rebalance the priorities within the scope of what Congress has contemplated. [00:12:44] Speaker 03: I'm into my rebuttal time, so unless the court has any further questions. [00:12:49] Speaker 01: Let's hear from Mr. Verrilli. [00:12:52] Speaker 00: I may please the Court. [00:12:53] Speaker 00: I'm Don Verrilli for the Plaintiffs' Appellees' Cross Appellants. [00:12:58] Speaker 00: In view of the argument that my friend Mr. Toth made this morning, I think it would be helpful to start with a focus on six key findings of the trial court, unchallenged findings, that I do think refute what my friend said just now and establish [00:13:18] Speaker 00: taking that requires just compensation. [00:13:20] Speaker 00: First, and this is at pages 10 and 11 of the appendix, [00:13:28] Speaker 00: flood control system in the 1940s and 50s to disconnect the river from the floodplain for the purpose, among other things, of creating arable farmland that people can invest in. [00:13:39] Speaker 00: Second, the government induced the plaintiffs to farm this arable land based on assurances of flood control, and the plaintiffs relied on that inducement. [00:13:49] Speaker 00: That's pages 361 to 71 of the appendix, those findings. [00:13:54] Speaker 00: A half century later, the government dismantled much of the flood protection system to reconnect the river to the floodplain because a court had held that the Endangered Species Act required the government to create shallow water habitat for protected species. [00:14:10] Speaker 00: That's at pages 15, 23, 25, and 6 of the appendix. [00:14:15] Speaker 00: And this is critical, I think, in view of my friend's argument this morning. [00:14:19] Speaker 00: The 2004 decision was a dramatic shift, not an adjustment as he described it. [00:14:25] Speaker 00: It required a massive new construction project that tripled the budget for the management of this project. [00:14:34] Speaker 00: There were more than 1,600 notches created in the dams, more than 300 water sheets that had been closed were open. [00:14:41] Speaker 00: There was massive construction for 10 years along this stretch of the river. [00:14:45] Speaker 00: Those findings are again in 25 and 26 of the appendix. [00:14:49] Speaker 00: Fifth, and I think this is also critical, [00:14:51] Speaker 00: The 2004 shift was not within anyone's contemplation, not the government's and certainly not plaintiff's. [00:14:58] Speaker 00: One plaintiff's purchased and invested in this land. [00:15:01] Speaker 00: That finding is at page 282 of the appendix. [00:15:04] Speaker 00: And sixth, the shift caused severe recurrent flooding. [00:15:08] Speaker 00: on plaintiff's land that would not have occurred had the government not made the shift, and that's at pages 351 to 353. [00:15:15] Speaker 02: So all of these, I mean, I'm getting, it's a little harder for us because you've given us six facts as the suggestion might be that we could ask if you pull one of those out, does that change the result? [00:15:26] Speaker 02: What is the most compelling aspect of those findings? [00:15:31] Speaker 00: the long-standing assurances that the government made and the reliance on your clients? [00:15:43] Speaker 00: Hardwick and Miller, the key is what would the landowner have reasonably contemplated at the time that the landowner made the investment? [00:15:55] Speaker 00: That the landowner would reasonably contemplate, based on the circumstances that existed then, that the flood protection would continue [00:16:03] Speaker 00: then I think the answer is that that's the key to be taking. [00:16:07] Speaker 00: But if at the time that the landowner made the investment, the landowner would reasonably contemplate that the government was going to take an action in the future that would inflict the harm, then there would not be a taking in that circumstance. [00:16:22] Speaker 00: And that's exactly the opposite. [00:16:23] Speaker 04: What's the timing of the investment? [00:16:25] Speaker 04: Suppose you have a landowner in 1970. [00:16:29] Speaker 04: says, I think I've got a couple of decades of stability of the government policy here. [00:16:34] Speaker 04: It's a good investment. [00:16:35] Speaker 04: I'll farm for 20 years. [00:16:37] Speaker 04: Who knows what happens after that? [00:16:39] Speaker 04: And then the government looks at the 1979 manual and says, this is not exactly rigid. [00:16:44] Speaker 04: It prioritizes flood control over other things, but we're going to shift the policy. [00:16:50] Speaker 00: So I'm going to answer your honest question directly, but I want to make a general point, and then I'll get the specifics. [00:16:54] Speaker 00: The general point being, [00:16:56] Speaker 00: what the Supreme Court said at Arkansas Game and Fish, which is no breadline exclusionary rules. [00:17:01] Speaker 00: Every case has got to be decided on its particular facts. [00:17:04] Speaker 00: The equities in that case might be somewhat different depending on the nature of the assurances, etc. [00:17:10] Speaker 00: But this is an easy case. [00:17:11] Speaker 00: This was a case in which these farmers bought this land [00:17:17] Speaker 00: based, as the court found, on assurances of flood protection. [00:17:20] Speaker 00: They clearly invested in it very soon after the program split place in the 1950s, et cetera. [00:17:28] Speaker 00: So not many decades in. [00:17:32] Speaker 00: And again, I would think, even in 1970, here, I think those landowners, those purchasers, would have a reasonable expectation that they weren't going to be subject to this. [00:17:42] Speaker 04: I guess the emphasis I was trying to place on it is the difference, perhaps, between a reasonable expectation of a fairly extended period of protection of the land for farming, but that [00:17:59] Speaker 04: That expectation, if that's all there was, or if that's all that was reasonable, was not violated by doing something, you know, 25 or 40 years later. [00:18:09] Speaker 00: Yeah, so I do think it's why that's one important factor, but that's why you've got to consider all the facts and circumstances in order to pick up on something that Your Honor raised. [00:18:19] Speaker 00: earlier about the difference between action and inaction here. [00:18:23] Speaker 00: It might be one thing that a farmer wouldn't be able to have a reasonable expectation that flood protection would continue in perpetuity. [00:18:32] Speaker 00: Government might run out of money, et cetera. [00:18:35] Speaker 00: But here, that's not what happened. [00:18:36] Speaker 00: There was a specific affirmative, as the trial court found, dramatic policy change to make a decision to invade [00:18:46] Speaker 00: the plaintiff's land by releasing the water to create the shallow water habitat on the plaintiff's land. [00:18:53] Speaker 00: And so whatever might have been an argument, we can argue about expectations based solely on the existence of flood protection. [00:19:00] Speaker 00: But this was that specific change, which resulted in a physical invasion deliberately done by the government, is, I think, is really a key thing here. [00:19:11] Speaker 00: And there is a finding again, which I said at the outset, [00:19:15] Speaker 00: where the trial court found that that was not in anybody's expectation, and as Your Honor recognized, that's in part because the government fought this change tooth and nail. [00:19:26] Speaker 01: What was the specific action that you think constituted the taking? [00:19:31] Speaker 01: Is it the dam releases? [00:19:33] Speaker 01: Was it the structures on the side of the river that were abolished? [00:19:38] Speaker 01: What are the specific actions that the government took? [00:19:41] Speaker 00: I think it is the series of specific actions over a 10-year period starting in 2004, going for 10 years, which included the opening of hundreds of water shoots that had previously been closed that let water flow through them off the Plains Land and otherwise. [00:19:58] Speaker 00: putting the 1,679 I think it is notches in the bands that were created again to increase water flow at various other projects. [00:20:07] Speaker 00: The specific purpose of which was to increase the water flow including on to our property and so I think it's [00:20:19] Speaker 00: It is that project that they undertook under court order starting in 2004. [00:20:25] Speaker 00: But those were specific things. [00:20:26] Speaker 00: It was an opening shoot, letting the order rush out onto our land. [00:20:33] Speaker 00: That's the essence of it. [00:20:34] Speaker 00: And this, I do think, allows me, if I could, to just make a point on statute of limitations. [00:20:40] Speaker 00: A question about, OK, when does this claim accrue? [00:20:44] Speaker 00: I think the fact that the construction itself went on for a 10-year period meant this was exactly the quintessential case for the application of the stabilization doctrine, which as the Supreme Court said in Dickinson is a practical and not a technical doctrine. [00:21:01] Speaker 00: And it's important in a situation where you're going to have recurrent flooding of this kind [00:21:06] Speaker 00: have enough time to wait and see when things stabilize. [00:21:10] Speaker 02: Accepting that, do the events preceding that stabilization period of 2014 constitute temporary takings, if there are takings at all? [00:21:20] Speaker 00: Yes, it's certainly a part of that. [00:21:23] Speaker 00: I guess what I would phrase it, Your Honor, is that it's a permanent taking. [00:21:27] Speaker 00: And the taking is occurring during the stabilization period. [00:21:33] Speaker 00: We don't know until we reach stabilization just how severe it's going to be. [00:21:39] Speaker 00: And that's why the doctrine exists, because you don't want landowners to rush in early. [00:21:43] Speaker 01: I was thinking about it like this. [00:21:46] Speaker 01: I was trying to wrap my head around the same concept that Judge Brooks was just asking you about, which is, can you recoup damages for the activities before stabilization if the claim didn't occur? [00:21:56] Speaker 01: And I was thinking about it like this. [00:21:58] Speaker 01: Am I right in understanding? [00:21:59] Speaker 01: that the accrual and the statute begins to run from when you knew or should have known. [00:22:05] Speaker 01: So clearly, there may be instances in which a reasonable person should not have realized that something was taken from them. [00:22:12] Speaker 01: But it was nonetheless taken. [00:22:14] Speaker 01: So the accrual becomes when they knew or should have known. [00:22:17] Speaker 01: But the thing that might have been taken before that is something they can claim compensation for. [00:22:20] Speaker 00: That's exactly how we think about it, Your Honor. [00:22:22] Speaker 00: I think it's an excellent analogy, is the discovery rule in a tort case, that your claim doesn't accrue until you discover the facts that lead you to understand that you've been injured by a certain cost. [00:22:31] Speaker 00: But then you get to recover for the whole period of injury. [00:22:35] Speaker 00: It's the same basic idea. [00:22:37] Speaker 00: And it's really, as the Supreme Court said, it's a pragmatic idea here that you don't want peace and litigation. [00:22:44] Speaker 00: You don't want plans rushing in too early. [00:22:46] Speaker 00: You don't want them to do actually what my friends and I say we should have done here, which is run into court in 2007 and the sign of the first major flood. [00:22:54] Speaker 00: You know, had we done so, they would have said, you can't claim a taking based on one flood. [00:22:59] Speaker 00: That's like classic government. [00:23:00] Speaker 00: I think one can agree that it might have been. [00:23:03] Speaker 00: So I just think that's exactly why we have the stabilization document. [00:23:06] Speaker 00: And if I could just make one, this is a cross of your point about, I'm sorry. [00:23:12] Speaker 04: Can I just ask one follow-up on the same topic we've just been on. [00:23:20] Speaker 04: Once the thing is stabilized in 2013 or 2014, one is looking back and is it right to say that one is recharacterizing a legal status that is now what happened in 2007 and 2008 as a legal character that it didn't actually have at the time, which is a [00:23:50] Speaker 04: kind of odd. [00:23:51] Speaker 00: I think about it differently, Your Honor. [00:23:53] Speaker 00: I take your point. [00:23:54] Speaker 00: I think about it differently. [00:23:55] Speaker 00: I think about it more in the way that you, Judge Moore, described that it was a taking during that period. [00:24:02] Speaker 00: Its character was a taking during that period. [00:24:04] Speaker 04: A permanent taking or a temporary taking? [00:24:07] Speaker 00: Because this is a permanent change, it would be a permanent taking. [00:24:12] Speaker 00: And that was its character all along, but until we reached the point of playing a stabilization doctrine of [00:24:20] Speaker 00: that things have stabilized sufficiently, that a claim has accrued, you don't have to sue. [00:24:30] Speaker 00: And the doctrine is trying to discourage people from suing too early. [00:24:34] Speaker 04: Is it that these, under the Arkansas standards, assuming that they apply to a permanent taking, which I guess is actually not at all a settled question, [00:24:43] Speaker 04: has this unusual character of taking place over an extended period of time. [00:24:51] Speaker 04: Because ordinarily, there's all this law about you value things as of the date of the taking, as if it is a single date, which [00:25:02] Speaker 00: Well, that's, I think, the whole reason you have the stabilization doctrine, particularly in flooding cases. [00:25:06] Speaker 04: Well, except the stabilization doctrine is about the Tucker Act accrual of the Clause of Action, not about the specific timing of the wrong. [00:25:16] Speaker 00: I do think the Arkansas Fishing Game analysis of the remand to this Court, I do think it's helpful in that if one looks at it, [00:25:30] Speaker 00: There were damages awarded for the harm to the timber during the period of the temporary fading. [00:25:36] Speaker 00: And there were damages awarded for the future losses. [00:25:40] Speaker 00: caused by the damage during that period. [00:25:43] Speaker 00: And I think that maps on very closely here. [00:25:46] Speaker 00: Here, the just compensation was awarded for the diminution in value of the property going forward. [00:25:53] Speaker 00: But that didn't capture the crop losses during that interim period. [00:25:57] Speaker 00: And I've seen it in my rebuttal time. [00:25:58] Speaker 00: But I do want to make one point, if I could, at the expense of my rebuttal time, back on the merits with respect to Hardwick and Miller. [00:26:06] Speaker 00: My friend says that we're arguing for a one-way ratchet. [00:26:10] Speaker 00: Not at all. [00:26:11] Speaker 00: Expectations will differ in a case like this one from a case like Hardwick. [00:26:16] Speaker 00: I think they're the ones who are really making a heads-eye-win-tails-you-lose argument. [00:26:20] Speaker 00: They say if it's a case like Hardwick where you could reasonably contemplate the change, you can't bring a taken claim. [00:26:27] Speaker 00: But even if you can't have reasonably contemplated the change, you can't bring a taken claim. [00:26:33] Speaker 00: And Your Honor asked a question about their standard. [00:26:35] Speaker 00: I would suggest Your Honor look at page 31 of their brief [00:26:38] Speaker 00: where they say, in all cases, that you should be deemed to have contemplated the future change. [00:26:45] Speaker 00: It's really a legal argument. [00:26:47] Speaker 00: It has nothing to do with the facts. [00:26:48] Speaker 00: And that can't possibly be right. [00:26:49] Speaker 00: They can try to distinguish Battery Park City if they want, but it doesn't work. [00:26:55] Speaker 00: I mean, it's the same thing. [00:26:56] Speaker 00: If you go back to pre-filling Battery Park City, it wasn't anything. [00:27:01] Speaker 00: And then their theory, really, I think, if the government decided [00:27:04] Speaker 00: If the government decided to undo the Tennessee Valley project and knock down all those dams for environmental reasons, and Chattanooga was underwater half the time, on their theory, [00:27:15] Speaker 01: I'm going to extend your time because I have questions about your cross-appeal and I'll extend the government's time equally. [00:27:22] Speaker 01: So I'd like to know what your argument is about the 2011 year. [00:27:27] Speaker 01: There was one year in which the Court of Federal Claims excluded that period because of the really sort of catastrophic, excessive flooding. [00:27:36] Speaker 01: She made fact-bindings [00:27:38] Speaker 01: that in that particular year, there was just so much rainfall that the flooding would have occurred regardless of the actions of the Army Corps of Engineers. [00:27:48] Speaker 01: So what is your argument about why that is nonetheless a takings? [00:27:52] Speaker 00: So two points to make. [00:27:55] Speaker 00: First, Your Honor, I think it was premised on an error of law. [00:27:59] Speaker 00: And it's not just a factual question. [00:28:01] Speaker 00: As we read the trial court's ruling, the trial courts have essentially found, well, [00:28:07] Speaker 00: The mechanism and the timing by which the water was released in 2011 differed from the mechanism and the timing in other years and therefore I'm not going to consider it to be taking. [00:28:20] Speaker 00: But the mechanism and the timing of the release of the water was all done pursuant to the same project that they had undertaken starting in 2004. [00:28:29] Speaker 01: I guess let me ask you my question since we do have limited time more directly. [00:28:35] Speaker 01: I was kind of thinking a lot about water and how the more water you have, the further it goes. [00:28:42] Speaker 01: I have four children. [00:28:43] Speaker 01: They spill stuff all the time. [00:28:45] Speaker 01: One glass of water on the kitchen floor may go oh so far, but an entire pitcher full of water is going to spread further and thereby cause more water damage. [00:28:55] Speaker 01: So my question to you is, did you argue this from the factual position of apportionment? [00:29:00] Speaker 01: Ah, yes. [00:29:01] Speaker 01: In this particular year, 2011, there were catastrophic rainfall efforts, which may have resulted in flooding on some of our properties. [00:29:12] Speaker 01: Nonetheless, the government contributed to the extensiveness of that flooding. [00:29:17] Speaker 01: The flooding was more than it would have otherwise been because of the government's actions. [00:29:22] Speaker 01: And as such, there should be some degree of damages. [00:29:26] Speaker 01: Perhaps it's not 100%, because maybe portions of your land would have flooded simply by virtue of the excessive rainfall, but that you should nonetheless be entitled to some analysis for apportionment purposes, looking at, well, what portion of the flooding did the government actually cause by its actions, as opposed to God? [00:29:46] Speaker ?: Yes. [00:29:47] Speaker 01: Did you make that argument? [00:29:48] Speaker 01: And did she address that argument? [00:29:50] Speaker 01: I didn't see her to address that argument. [00:29:52] Speaker 00: I don't have the record site handy. [00:29:53] Speaker 00: I don't see it. [00:29:54] Speaker 00: When I sit down, I can find it. [00:29:56] Speaker 00: But I do think this does go to a factual error that we did point out, which is I think that the judge made an error by dismissing our misunderstanding and dismissing our experts' causation analysis, which did address, among other things, the issue that Your Honor just raised. [00:30:11] Speaker 01: I mean, did it specifically address the fact that [00:30:14] Speaker 01: There may have been flooding, vis-a-vis an act of God that wasn't a resultant cause of the Army Corps of Engineer actions, but their Army Corps of Engineer actions worsened the damage to our property and therefore that worsening [00:30:29] Speaker 01: is the apportion that we ought to be able to claim. [00:30:32] Speaker 00: I believe so, Your Honor. [00:30:34] Speaker 00: But I don't want to get out of my skis too far. [00:30:35] Speaker 00: Let me confirm it. [00:30:37] Speaker 01: OK. [00:30:37] Speaker 01: Now I want to move you to your crop claims. [00:30:38] Speaker 01: No, no, you still don't get to leave. [00:30:40] Speaker 01: You still don't get to leave. [00:30:40] Speaker 00: I'm happy to stay here as long as you like, Your Honor. [00:30:42] Speaker 01: Yes. [00:30:43] Speaker 01: Well, especially when I'm talking about your cross appeal, that probably makes you very happy. [00:30:46] Speaker 01: So on the crops issue, am I right in understanding that the potential damages for the crops could be three times the diminution and the value of land, or in some instances, quite [00:30:58] Speaker 01: a big chunk of change. [00:31:00] Speaker 00: It could be quite a bit because you're talking about an extensive period. [00:31:06] Speaker 01: So I was trying to think of crops like this. [00:31:08] Speaker 01: I was trying to, in my head, think about, well, you know, if this were trees or if this were a structure on the land, like say the levee in this case, you know, you planted something, it was property and it was destroyed by the flood. [00:31:24] Speaker 01: Why would you not be entitled to that? [00:31:28] Speaker 00: Right. [00:31:29] Speaker 00: And I do think it pretty follows, and I tried to suggest this to Judge Shonto earlier, I think it falls pretty directly from Arkansas game and fish. [00:31:37] Speaker 00: Timber crops. [00:31:38] Speaker 01: Yes, I understand these are friendly questions. [00:31:40] Speaker 01: So the next question I have though is, what would the value of what you lost be? [00:31:45] Speaker 01: Would it be the value it was worth on the day it was destroyed or the ultimate value had it matured? [00:31:53] Speaker 01: And here's why I ask. [00:31:54] Speaker 01: Suppose I was in the process of building a house and I had only poured the foundation and maybe gone a little further and then the government came and took the land. [00:32:03] Speaker 01: I can't charge them the million dollars the final house may have ultimately been worth someday, because it wasn't a final house. [00:32:11] Speaker 01: It was only a portion of a house. [00:32:13] Speaker 01: So how do you assess damages on immature crops, crops that have, so if your crops were at their full height and ready to be harvested, then you would have the full value of, the market value of those crops. [00:32:26] Speaker 01: But if the crops are at their infancy, maybe they were just seeds recently planted, [00:32:32] Speaker 01: What is the measure of damages in a situation like that? [00:32:34] Speaker 00: So I think it's the value of the mature crops. [00:32:36] Speaker 00: And again, I would analogize to Arkansas. [00:32:38] Speaker 00: It can't be. [00:32:38] Speaker 01: It has to be the value of mature crops minus whatever you saved in there. [00:32:44] Speaker 00: Yes, of course, Your Honor. [00:32:45] Speaker 00: That's exactly right. [00:32:46] Speaker 00: But the baseline would be. [00:32:47] Speaker 00: And I think Arkansas Fish and Game points in that direction with respect to the future damage. [00:32:52] Speaker 00: Because there, the future damage to the timber was damage to immature trees that didn't grow to full maturity because of the sogginess of the soil. [00:32:59] Speaker 04: What about the never planted crops? [00:33:03] Speaker 04: So there's the mature crops, the seedlings, the little ones, but then they flooded it and we never got anything in the ground. [00:33:11] Speaker 00: Yeah, I think probably there would be a claims act, too. [00:33:13] Speaker 00: What? [00:33:15] Speaker 00: Come on, now you're going too far. [00:33:17] Speaker 00: Well, fair enough. [00:33:19] Speaker 00: I'm content to have the court draw the line where the court thinks the line should be drawn. [00:33:23] Speaker 01: All right, Mr. Riley, I'm going to fully restore your rebuttal time. [00:33:25] Speaker 01: We went over by quite a bit. [00:33:27] Speaker 01: Do you know how much we went over by? [00:33:29] Speaker 01: Five and a half. [00:33:30] Speaker 01: Okay, so we're going to add that time. [00:33:32] Speaker 01: I'm going to restore your rebuttal time, and I'm going to add that time into the government's rebuttal time now. [00:33:36] Speaker 01: Thank you. [00:33:36] Speaker 01: Yes. [00:33:37] Speaker 03: There's more to follow up on your question from my opening presentation. [00:33:43] Speaker 03: You made an assumption that the planet's lost all their land. [00:33:46] Speaker 03: That's not the case. [00:33:47] Speaker 03: You may know that from our briefs that they've still retained economic value of portions of their crops. [00:33:53] Speaker 03: Their business still remains profitable, so it's not a complete [00:33:56] Speaker 03: taking that the court found. [00:33:57] Speaker 03: It's a diminutive. [00:33:58] Speaker 01: Yeah, but this is a physical taking, so we don't have to look like at that anemic pen central analysis and the whole property. [00:34:05] Speaker 03: But the Arkansas game of fish factors in some instances mimic some of those factors, and one of which is the severity of the interference. [00:34:12] Speaker 03: And that diminishment is not enough under the pen central case law to constitute a taking. [00:34:18] Speaker 01: Yes, but this is a physical taking. [00:34:20] Speaker 01: No, I understand that. [00:34:21] Speaker 01: The Supreme Court has made it clear. [00:34:22] Speaker 03: No, I understand. [00:34:23] Speaker 03: The proportions, though, are [00:34:25] Speaker 03: out of step with what the court normally finds would give rise to regulatory taking, which is at least 50%. [00:34:30] Speaker 03: Here are the diminutions. [00:34:32] Speaker 01: Yes, but this isn't a regulatory taking. [00:34:34] Speaker 01: Why are you still talking about it? [00:34:36] Speaker 03: Because the factors are, the Arkansas game fish factors are based, drawn from some of the same case law. [00:34:42] Speaker 04: But is there any reason in this case either looking to what we have to decide right now in front of us or what is pending still in the unresolved [00:34:54] Speaker 04: plaintiff's claims for us to decide whether the Arkansas analysis applies to a permanent flooding taking as opposed to the temporary one that existed there. [00:35:05] Speaker 03: So we haven't, I mean the parties have assumed that it does apply, but we haven't briefed that specific question. [00:35:10] Speaker 03: I would [00:35:11] Speaker 03: If it's going to consider that, I would take briefing on that specific point. [00:35:17] Speaker 03: But I mean, this entire case has been litigated on the assumption. [00:35:19] Speaker 01: I was going to say, when you ask us if you would like us if we're going to consider it, Arkansas Game and Fish is throughout these briefs. [00:35:27] Speaker 01: And you all treated it as though it were applicable. [00:35:30] Speaker 01: So why would we need additional briefing? [00:35:32] Speaker 01: You had a lot of opportunity for briefing on exactly this point and did. [00:35:36] Speaker 03: Well, I think the parties assume that it applies, and so that's how the court octets it. [00:35:40] Speaker 03: Is that true of the other treelanctus, the blends who are not here? [00:35:45] Speaker 03: I'm not sure if that's the case. [00:35:49] Speaker 03: So to get to my friend's recitation of the six factual [00:35:55] Speaker 03: I would just emphasize that this notion about the scope of the project and whether the changes to the operation and configuration of the system are within the scope of what was originally contemplated is a legal question. [00:36:07] Speaker 03: It's an issue of essentially foreseeability. [00:36:10] Speaker 03: And so factual findings are not to matter. [00:36:13] Speaker 03: It's a legal question that court reviews to no vote. [00:36:17] Speaker 03: Regarding the application of what my friend calls a Miller and Hardwick rule, St. [00:36:22] Speaker 03: Bernard Parish expressly left open the possibility [00:36:29] Speaker 03: simply, because it applied Miller, it was simply related to evaluation questions, which are not what's determinative here. [00:36:37] Speaker 03: We would submit that it's a different analysis when it comes to relative benefits and when it comes to causation. [00:36:44] Speaker 03: And I would point out in Alfred, which was the most recent relative benefits case, the court emphasized that relative benefits is a very broad concept, and it didn't indicate in any way that it was limited. [00:36:56] Speaker 04: Does it matter that the [00:36:58] Speaker 04: purpose of the original project was to control floods. [00:37:04] Speaker 04: The purpose of the 2004 etc. [00:37:07] Speaker 04: actions was to some extent the opposite, but certainly it was not to control floods. [00:37:12] Speaker 04: It was willing to sacrifice the increased floods for other goals. [00:37:17] Speaker 03: I don't think it matters because if you look at St. [00:37:19] Speaker 03: Bernard Parish, which is a particularly harder case because there were two different [00:37:30] Speaker 03: levies were for flood control protection, yet the court found those two projects, two different projects, were sufficiently related so as to have that nexus and further found them in the first year. [00:37:42] Speaker 01: Could I ask you to turn to the cross if you'll please? [00:37:44] Speaker 03: Yes. [00:37:45] Speaker 03: And so first, on the 2011 flooding, your question, which is more, was about portionment. [00:37:51] Speaker 03: Frankly, they did not put on that case about what increment of flooding should be [00:37:58] Speaker 03: So I hear you saying that. [00:38:01] Speaker 01: The problem for me, and you may well be right, the problem for me is if we were to get to that point, the record here is just so tremendous. [00:38:09] Speaker 01: It's hard for me to go into that level of detail. [00:38:13] Speaker 01: And quite frankly, both parties didn't spend sufficient time briefing this so that I can appreciate what really was argued and not argued. [00:38:21] Speaker 01: If they did make that argument, I mean, if I were going to reach that point and I was concerned that there ought to be apportionment under circumstances like you heard me describe, wouldn't the proper course of action for me to be vacant remand to say nothing? [00:38:36] Speaker 01: and to let the trial court figure out whether or not they made a sufficient case. [00:38:41] Speaker 01: Because here's the problem. [00:38:42] Speaker 01: This is just, what, three property owners or however many it is. [00:38:45] Speaker 01: And there's hundreds more waiting in the wings for this. [00:38:48] Speaker 01: So if that apportionment argument wasn't made here, it may well be made in one of these yet to develop records. [00:38:54] Speaker 03: No, I understand. [00:38:56] Speaker 03: I don't dispute that that would be a reasonable approach if you disagree with the government on the main liability points. [00:39:01] Speaker 03: Turning to the crops, I think that the [00:39:06] Speaker 03: agricultural crops here at issue are different from trees in Arkansas game of fish. [00:39:10] Speaker 03: I don't mean to be flip about this, but the rationale for including the destruction of timber in Arkansas game of fish was that the destruction of timber was a proxy for measuring the temporary taking that occurred there. [00:39:23] Speaker 03: Here the court found a permanent taking. [00:39:28] Speaker 03: You can know at the end of the crop season whether they are harvestable or not. [00:39:34] Speaker 03: That's not the case with tinder, which requires examination over a longer period of time to determine whether it's going to be merchantable. [00:39:40] Speaker 01: I don't understand why that makes them not compensable. [00:39:45] Speaker 01: I mean, why aren't they like a house or a structure or a levy or anything else? [00:39:48] Speaker 01: I don't understand. [00:39:50] Speaker 01: Why are they not compensable? [00:39:51] Speaker 01: They were taken. [00:39:52] Speaker 01: They were destroyed. [00:39:54] Speaker 01: Why are they not compensable? [00:39:55] Speaker 03: Because under the Court of Claims precedent in Barnes, even in a permanent taking context, damages that occur to crops while it's taking is ripening, say, while it's temporary, are not compensable. [00:40:10] Speaker 01: OK, but perhaps that covers maybe up until the date of accrual, theoretically. [00:40:16] Speaker 01: But what about the crops planted after accrual? [00:40:18] Speaker 01: Even if that barn's proposition is correct, which I have some serious doubts about, what about the crops? [00:40:25] Speaker 01: Because the crops weren't limited to the pre-accrual date. [00:40:27] Speaker 01: There were plantings of crops that were destroyed after the accrual. [00:40:30] Speaker 01: What would your possible argument be for why those are not convincing? [00:40:33] Speaker 03: Well, I think it highlights the anomaly of the selection of the later date of taking. [00:40:38] Speaker 03: I mean, it's very strange. [00:40:40] Speaker 03: to say the least, to have a takings claim that did not accrue until... I know. [00:40:45] Speaker 01: Now you're not answering my question at all, though, and you're coming up on the end of your time. [00:40:49] Speaker 03: No, I understand. [00:40:50] Speaker 01: I don't have an answer. [00:40:51] Speaker 03: Correct. [00:40:52] Speaker 03: But I think what it highlights is the anomaly of the trial court's finding about when the claim accrued, which was [00:41:00] Speaker 03: 2014, seven years after the first flooding occurred. [00:41:05] Speaker 03: And we think the record by the Planet 7 theory of the case and their complaint, they complained about a change in flooding. [00:41:14] Speaker 01: You heard my discussion with opposing counsel about the statute of limitations period and this concept of being able to get damages that go backwards prior to the date of accrual because the standard is new or reasonably should have known kind of thing. [00:41:27] Speaker 01: So if it hasn't stabilized and hasn't been perfected yet, you know, the accrual date could be later, but then you realize it, why aren't you allowed to go backwards and get the damage that was caused? [00:41:38] Speaker 03: I would just come back to Barnes. [00:41:40] Speaker 02: And then the other side answer to Barnes is that that was called into question by Arkansas gaming, right? [00:41:46] Speaker 03: Right, which is my point about distinguishing Arkansas gaming fish. [00:41:50] Speaker 03: First of all, it wasn't expressly called into question. [00:41:53] Speaker 03: And furthermore, it's bachelor distinguishable because of the nature of the timber this year being very different from seasonal crops. [00:42:01] Speaker 01: OK. [00:42:02] Speaker 01: Thank you very much, Mr. Verralli, for restoring your two minutes of rebuttal time. [00:42:11] Speaker 00: Thank you, Your Honor. [00:42:12] Speaker 00: Three points. [00:42:14] Speaker 00: First, diminution issue. [00:42:17] Speaker 00: I mean, that does apply to the 2007-2014 period as well as afterwards. [00:42:23] Speaker 00: My friend on the other side made an argument, I think, that Your Honor correctly recognized was one applies to regulatory takings and not physical invasions. [00:42:33] Speaker 00: I just point out the Supreme Court's recent decision in Cedar Point. [00:42:37] Speaker 00: The union organizers were on the property for half an hour in the morning and half an hour in the evening, I think. [00:42:45] Speaker 00: The union organizers were on the property for half an hour in the morning and half an hour at lunch or in the evening, and that was a permanent physical invasion that constituted a taking. [00:42:56] Speaker 00: And Loretto, of course, was just running out. [00:42:59] Speaker 00: that one cable wire into an apartment and that was a permanent physical invasion that constitutes the taking. [00:43:04] Speaker 00: So the idea that the physical taking has to result in a diminution of more than 50% of the value of the property is just not right. [00:43:15] Speaker 00: Second, with respect to Barnes, we do think that it wasn't an accident that this court on remand in Arkansas Fish and Game didn't cite Barnes. [00:43:24] Speaker 00: I think it was because that was the very reasoning that the Supreme Court repudiated that you shouldn't think of this as a taking, you should think about it as isolated torsious actions. [00:43:33] Speaker 00: And then third, with respect to the specific question of 2011, [00:43:38] Speaker 00: We're trying to find what the record says about it. [00:43:45] Speaker 01: Do you have any objection to if I were to be in your camp on the primary appeal to me just vacating and remanding on that 2011 year to assess whether you did present a case for apportionment? [00:44:00] Speaker 01: Does that seem like a reasonable course of action? [00:44:03] Speaker 00: Yes, I think that would be fine, Your Honor, because we've suggested even with respect to crop loss, there needs to be a remand to calculate what the damages are. [00:44:12] Speaker 00: And so with respect to 2011, that would be fine. [00:44:14] Speaker 00: And I do, Your Honor, raise exactly the last point I was going to make, which is that these are bellwether cases, and this is an issue that I think it would behoove everyone to get clarity on as to whether the claim could go forward under an appropriate standard. [00:44:29] Speaker 01: Thank you. [00:44:30] Speaker 01: I thank both counsels. [00:44:31] Speaker 01: This case was taken under submission, and it was an excellent argument. [00:44:35] Speaker 01: We're both very helpful to the court, so thank you.