Guggenheim: The Regulatory Takings Case That Won't Die
Posted in Court Decisions

We thought it was over in 2009 when the Ninth Circuit held that the City of Goleta's rent control ordinance constituted a taking.

We thought it was over in late 2010 when an en banc Ninth Circuit panel ruled the other way, holding that the property owner failed to establish the "investment-backed expectations" necessary to establish a takings claim under Penn Central.

Now, we're not sure if it's ever going to be over.  Apparently, Dan Guggenheim has decided to seek review by the U.S. Supreme Court, so there may yet be more drama for the long-playing battle between the Guggenheims and the city over a mobile home rent control ordinance that the parties seem to agree has the effect of transferring the vast majority of the mobile home park's value to the tenants. 

So what happens now?  First, the Guggenheims must actually file their Petition for Writ of Certiorari, asking the Supreme Court to review the case.  Then, the Court decides whether it wants to review the case, and it's a serious uphill battle.  The Court receives thousands of petitions each year and it typically selects only about 100 of them for review.  In other words, based on the math alone, the Guggenheims aren't likely to see the inside of those hallowed halls. 

But some cases are more likely than others to pique the Justices' interest (four must agree that review is warranted), and controversial land use cases that have garnered media and practitioners' interests - and that have generated multiple, conflicting decisions by separate panels of a federal Circuit Court - probably have a greater likelihood of being chosen then most cases. 

Add to this that the decision comes out of the Ninth Circuit - which has a well-documented reputation for receiving far more than its share of decisions selected for review - and the Guggenheims probably have a decent shot (of course, even if these factors make the case five times more likely to be selected than a typical case, that still probably means only about a 10% chance of being reviewed).

And if the Supreme Court grants review?  Obviously each case is reviewed on its own merits, but according to an analysis of ten years' worth of Supreme Court review, the Ninth Circuit was reversed (or had its decision vacated) 80% of the time and affirmed 20% of time.  In other words, the Guggenheims' odds once they get there are a whole lot better than the odds of getting there in the first place.

We'll let you know what happens.

UPDATE:  February 4, 2011, 4:00 p.m.  Since publishing this post earlier today, I've gotten feedback from several sources, some from people involved in the case and some from other interested observers.  The one consistent comment is a belief that the chances of Supreme Court review are quite a bit higher than I forecast above.   While nobody is telling me they thinks it's a slam dunk, there is some optimism that this really does meet a lot of the criteria the Court looks for when selecting cases.  Stay tuned.

  • Rick E. Rayl
    Partner

    Rick Rayl is an experienced litigator on a broad range of complex civil litigation issues.  His practice is concentrated primarily on eminent domain, inverse condemnation, and other real-estate-valuation disputes.  His public ...

California Eminent Domain Report is a one-stop resource for everything new and noteworthy in eminent domain in California. We cover all aspects of eminent domain in California, including condemnation, inverse condemnation, and regulatory takings. We also keep track of current cases, project announcements, budget issues, legislative reform efforts, and report on all major California eminent domain conferences and seminars.

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