Oak to Ninth & Eminent Domain
The following is a legal analysis of the Oak to Ninth case in Oakland California. It's posted here with the permission of the author, John Ryskamp.
by John Ryskamp
I have been following the Oak to Ninth project and some of the results of my recent legal research may be of use to your clients. I have spent the past year researching the response to the Kelo eminent domain decision, and the book based on my research has just been published and is linked below.
As you know, every government policy--zoning, eminent domain and every other--must at least pass minimum scrutiny. That is, they must be rationally related to a legitimate government purpose. In the 1980s, under the Midkiff decision, it appeared that the court did not consider government purpose to be a fact-based test. The Court in that case said that the purpose need only be "conceivable."
Then the Court realized that there were serious Constitutional problems if government purpose were not held to be a question of fact for the trier of fact. The Court backtracked. In two 1996 cases, Romer v. Evans and U.S. v. Virginia, the Court clarified that government purpose is indeed a question of fact for the trier of fact. This opened up the government purpose prong of minimum scrutiny, to litigation.
Justice Kennedy elaborated on this prong in the eminent domain context in his Kelo concurrence. When there was a question whether private purpose had been substituted for government purpose (what is known in political science as "capture"--basically, a giving of government powers to private interests)--Justice Kennedy laid out discovery criteria articulating the factual indicia of the substitution.
But that is only one grounds for arguing that there is no government purpose for the government policy, which, in the Oak matter, would I assume revolve around the various Oakland government decisions facilitating the project, such as zoning decisions or any other land use decisions including, but not limited to, eminent domain.
The OTHER grounds comes up when the question is asked: assuming there has been no substitution of private purpose for government purpose, is there another way to attack the government policy on the grounds of failure of government purpose?
The answer is, Yes. Quite apart from capture considerations--which show us there is NOT government purpose--does the Court give us any guidance as to what, in fact, IS government purpose? That is, does it furnish an affirmative, and not just a negative, answer? It does. The "Lochner" era--when the Court would not allow health and welfare regulation to interfere with economic rights--is said to have come to an end with West Coast Hotel v. Parrish (1937), when the Court began to allow such regulation. However, one doctrine was maintained by the Court through both eras, and it is good law today. In Euclid v. Ambler (1926), the Court upheld residential zoning because it maintained an important fact: housing. That is a Lochner era case. West Coast Hotel itself upheld a minimum wage law because it maintained income. West Coast Hotel established the scrutiny regime, of which the minimum scrutiny test is part.
Note that "maintenance" is explicitly used in both cases, and in both cases, the Court and the litigants agree that the facts at issue--income or housing--are important facts.
Thus, for the Court, government purpose IS the maintenance of important facts.
Your clients have a great advantage going into this dispute. The City and the residents all agree that housing is an important fact. The only question is: does the plan maintaining housing? The Oakland residents claim it undermines housing (and probably other facts, the importance of which are also undisputed). So how to resolve the question of whether the Oak project maintains important facts?
Under Midkiff, the "conceivable" government purpose test allowed discretion in government--for example, to decide that the facts pointed to a certain conclusion, or to allow a lesser harm for what government, based on its reasonable interpretation of the facts, determined was a greater good.
However, a close examination of Euclid, West Coast and Justice Kennedy's concurrence made it clear that maintenance is determined by interrelating important facts. For the Court, discretion is not an indicium of interrelationship, because interrelationship is only a fact-based test. For the Court, important facts never conflict with each other, they harmonize with each other (as do all parts of the Constitution). This makes it possible and necessary to undertake a SOLELY FACT-BASED DECISION-MAKING PROCESS. Recourse to discretion, is not relevant. It is very important to keep this in mind and keep it squarely before courts at all times.
Traditionally, litigants such as your clients, are at a disadvantage in presenting their research and analysis because government is felt to be allowed either to adopt that research and analysis, or not. However, that is not the law.
I have suggested that the government purpose prong of minimum scrutiny be litigated more forcefully, and two eminent domain cases have recently been filed which allege that there is no government purpose to the eminent domain use (in both cases, because there has been capture). One is the famous Atlantic Yards Brooklyn eminent domain case in Federal Court. Another is a New Jersey case on which I have provided some advice and which I discuss in my book. It also proceeds on the idea that private purpose has been substituted for government purpose. It has just survived a motion to dismiss, and I attach the complaint, motion papers and decision. (The count which has survived the motion is that which alleges that the ordinances authorizing eminent domain are "arbitrary and capricious," that is, that they lack a government purpose.)
In short, in the past government purpose has been regarded as carte blanche for the government, and very difficult to defeat. That is no longer true. It is a question of fact for the trier of fact, and amenable to wide-ranging discovery. Many redevelopment projects are simply conspiracies to defraud between public officials and private parties. Behind many of them stands the bond market, which actually instigates many redevelopment projects because it wishes to get both a commission on the sale of the bonds, and fees to manage the proceeds.
The IRS is becoming active in this field as well. Recent challenges to the tax exempt status of both bonds and 501(c) organizations are based on the government's allegation that neither the bonds nor the organizations have a government purpose. You should investigate both the 501(c) and bond angles of the Oak project as well.
You may want to allege capture in the government decisions made respecting the Oak matter. However, you should CERTAINLY argue that those decisions do not have a government purpose--they do not maintain important facts by interrelating important facts.
Frankly, my research shows that is often better to avoid state court and go to the Federal Court. Here are some considerations:
1. file in Federal Court: Federal law is where these legal developments are clearest and when they have occurred most recently;
2. file a civil RICO suit in addition to claims of violation of due process and equal protection (violations of the latter have been expanded to include policies which affect a discrete group and exhibit animus against an important fact, such as housing). Under RICO, the activities alleged in connection with failure of government purpose are fraud, conspiracy and extortion Here is the latest word on this, in the context of government entities.:
[E]ven though a government agency cannot be named as a defendant person under RICO, a government agency may still serve as the enterprise through which a defendant engages in a pattern of racketeering. Any governmental agent extorting persons "under color of authority" is participating in the conduct of the governmental entity's affairs through a pattern of racketeering activity. Governmental entities may also be an enterprise if they are a passive instrument through which the racketeering acts are committed, advanced or concealed, or a governmental entity may also be a victim enterprise, e.g., if outsiders were operating or managing the affairs of the enterprise through bribery, for example. Being named as an enterprise, however, does not expose the governmental entity to any liability.
3. request a preliminary injunction.
I will be very interested to see how this matter proceeds. From my research, I can tell you that government entities are not at all prepared to face this new challenge that their policies fail government purpose.
Finally, you should note that eminent domain decisions are no longer "clean." That is, we are past the era in which a litigants defeats an eminent domain use, and then forgets about the threat. Not only does government still want the property, but also, the winning litigant is now recognized as having new duties with respect to relief. YOU will be required to develop Court orders with respect to maintaining the facts important to your clients: rewriting tax and zoning laws and monitoring compliance. And your principle will be maintaining important facts by interrelating important facts: how in FACT does taxation relate to zoning, housing to taxation, education to taxation, and so on. Quite a heavy, ongoing burden. But that's the way it is now.
In terms of the scrutiny regime, if you win you will, in effect, have raised the level of scrutiny for the facts of your clients. An example of the burden which then falls on the winners is available in the Abbott v. Burke New Jersey education cases (available at www.edlaw.org). When, in the early 1970s, the Court there ruled that education articulated in the New Jersey Constitution, enjoyed more than the minimum scrutiny most state constitutional public education mandates enjoy, it started the winners down a road of enforcement which has not yet ended. The Court still retains jurisdiction in the Abbott cases, over thirty years later! This should be the model of how you are to proceed.
The Eminent Domain Revolt: Changing Perceptions in a New Constitutional Epoch by John, Ryskamp (Paperback - Nov 1, 2006)