One of the most frustrating things a plaintiff faces in litigating a taking case are the delays—some delays are designed to accommodate a federal agency’s need to review documents before acting on them and others arise because of the complacency with which parties routinely seek extensions. Most plaintiffs weather these challenges and finally reach a resolution of their case, but occasionally, some plaintiffs get caught up in a litigation nightmare.
Take for example the plaintiffs in Anaheim Gardens v. United States. These plaintiffs filed their taking case in the U.S. Court of Federal Claims in the year (1) marking the appointment of the nation’s first female Attorney General, (2) the inauguration of Bill Clinton as president, and (3) the World Trade Center bombing.
Anaheim Gardens challenged as a regulatory taking Congress’ enactment of the Emergency Low-Income Housing Preservation Act (ELIHPA) and the Low-Income Housing Preservation and Resident Homeownership Act (LIHPRHA), essentially contending that by eliminating their right to prepay their mortgages and exit the affordable housing market program after 20 years, Congress had taken their contract right to exit the program and to exclude low-income tenants from their property.
After an appeal to the Federal Circuit and being handed off to two other Court of Federal Claims judges, the case was finally decided by a third judge on January 27, 2025. But the holding was not what the plaintiffs had been waiting for. After 31 years of litigation, the Court, applying the three-factor analysis from Penn Central, found that only two plaintiffs were entitled to compensation. The Court found that the remaining plaintiffs failed to prove that a taking had occurred, explaining that they “were not able to tip the scales of the economic impact element of Penn Central in their favor.” After disregarding their appraiser’s testimony and another report from the previous trial, the Court found that their economic impact was under 50%.
The trial judge summed up this sad case:
Much of the difficulty with the [losing plaintiffs’] approach could perhaps be attributed to the undeniable and unnecessary delay in reaching trial. While there is no precise standard to determine how much delay is too much, common sense suggests that avoidable delay is fraught with peril.
Read J. Tapp’s full decision here.
