California Eminent Domain Report

Typically, regulatory takings litigation generates a lot of noise and gnashing of teeth but, at the end of the day, rarely are government agencies bitten with an order that they pay compensation. However, a new opinion from the federal 9th Circuit Court of Appeals, Guggenheim v. City of Goleta (Sept. 28, 2009, Case No. 06-56306), demonstrates that regulatory takings litigation can have teeth. In Guggenheim, the 9th Circuit holds that the city of Goleta's rent control ordinance on mobile home parks went too far and that the city will have to pay the park's owners just compensation. This case, particularly coupled with two other recent regulatory takings cases, Monks v. City of Rancho Palos Verdes and Casitas Municipal Water District v. United States, suggests that agencies may now need to pay close attention to their regulations if they hope to avoid a regulatory takings bite.

Whether these cases reflect a new trend remains to be seen, but it sure looks like the tide may be turning. And, if the trend continues, agencies in California should pay particular attention, since successful inverse condemnation plaintiffs stand to recover their attorneys’ fees, in addition to whatever damages they can prove. For more information about Guggenheim and regulatory takings generally, take a look at an October 15, 2009, article in the Los Angeles Daily Journal, "Adding Some Bite to the Bark."