Judicial Takings in Vandevere V. Lloyd

I. INTRODUCTION In Vandevere v. Lloyd,1 the Ninth Circuit created a circuit split by changing its test for determining which property interests are protected under the Fifth Amendment's Takings Clause. With the First Circuit applying federal constitutional law and the Ninth Circuit applying state law, the Ninth Circuit's new test conflicts with Supreme Court precedents that the First Circuit follows.2 The Ninth Circuit in Vandevere considered whether some of Alaska's regulations on commercial salmon fishing, which shortened fishing seasons, reduced fishing areas, and limited fishing for various salmon species, violated the Takings Clause.3 Commercial fishermen claimed that the regulations severely diminished the value of their entry permits by limiting the number of fish they could catch and sell.4 Although claiming to follow the Supreme Court's decision in Lucas v. South Carolina Coastal Council* and its own decision in Schneider v. California Department of Corrections? the Ninth Circuit applied a new Takings Clause analysis in which "state law governs the demarcation of a property right, while federal law governs the manner in which the state must respect" that right.7 Deferring entirely to the Alaska Supreme Court's holding in a nearly identical case,8 the Ninth Circuit then held that the fishermen's entry permits were "not property for purposes of a takings claim."9 This Note argues that the Ninth Circuit in Vandevere incorrectly applied both the Supreme Court's Lucas line of cases and its own precedent in Schneider. The Ninth Circuit distorted existing Takings Clause analysis to produce a rule that conflicts not only with its own precedent and that of the First Circuit, but also with Supreme Court precedents. Additionally, the court's failure to independently examine the nature and extent of rights that Alaska law created in entry permits effectively permitted a judicial taking of private property without just compensation.10 Part II of this Note explains relevant legal principles for determining whether an interest is property for Takings Clause purposes by examining the regulatory-takings jurisprudence of the Supreme Court, the First Circuit, and the Ninth Circuit. Part III describes the facts and procedural history of Vandevere. Part IV summarizes the court's reasoning and decision in Vandevere. Part V analyzes Vandevere: first, it shows how the Ninth Circuit misapplied Lucas and Schneider, second, it demonstrates why the two elements in a proper Takings Clause inquiry logically and constitutionally cannot be hermetically sealed off from one another as separate inquiries without reaching absurd results; and third, it argues that the Vandevere rule facilitates judicial takings. Part VI concludes. II. SIGNIFICANT LEGAL BACKGROUND" The Fifth Amendment's Takings Clause, applied to the states through the Fourteenth Amendment,12 provides that private property must not "be taken for public use, without just compensation."13 A person cannot receive compensation for an alleged taking, however, unless he has a "Takings Clause-recognized property interest."14 This Part addresses how the Supreme Court, the First Circuit, and the Ninth Circuit have determined what qualifies as property for Takings Clause analysis. A. Supreme Court Precedents The Supreme Court has established two categories of per se takings that almost always require compensation: (1) regulations that cause a permanent physical invasion of the property and (2) regulations that deprive an owner of all beneficial use of the property.15 "Outside these two relatively narrow categories," regulatory takings claims, such as when a regulation severely diminishes property values, are decided according to the principles found in Penn Central Transportation Co. v. New York City.16 Additionally, a plurality of the Court has recognized the possibility of a judicial taking of private property.17 In Lucas v. South Carolina Costal Council, the Supreme Court held that a state regulation depriving a landowner of all beneficial use of his property amounted to a taking without just compensation under the Fifth Amendment. …