Case Name: Albert J. AVENAL Jr., et al. v. The STATE of Louisiana and the Department of Natural Resources
Court: Louisiana Court of Appeal
Jurisdiction: Louisiana
Decision Date: 1999-03-03
Citations: 757 So. 2d 1
Docket Number: No. 99-C-0127
Parties: Albert J. AVENAL Jr., et al. v. The STATE of Louisiana and the Department of Natural Resources.
Judges: Court composed of Chief Judge ROBERT J. KLEES, Judge MIRIAM G. WALTZER, Judge JAMES F. McKAY III, Judge Pro Tempore PHILIP C. CIACCIO and Judge Pro Tempore JAMES C. GULOTTA.
Reporter: Southern Reporter, Second Series
Volume: 757
Pages: 1–15

Head Matter:
Albert J. AVENAL Jr., et al. v. The STATE of Louisiana and the Department of Natural Resources.
No. 99-C-0127
Court of Appeal of Louisiana, Fourth Circuit.
March 3, 1999.
Opinion on Rehearing March 15, 2000.
Writ Denied June 23, 2000.
Richard P. Ieyoub, Attorney General, Andrew C. Wilson, David L. Carrigee, Donna M. Young, Jedd S. Malish, Burke & Mayer, Special Assistants Attorney General, New Orleans, LA, Attorneys for Relator/Defendant, the State of Louisiana, through the Department of Natural Resources.
Wendell H. Gauthier, Scott Labarre, Gauthier & Murphy, Metairie, Louisiana and Michael St. Martin, Michelle Mayne Davis, St. Martin & Williams, Houma, LA, Carolyn A. McNabb, McNabb & Mire, Houma, LA, and Philip Cossich, Lawrence Dyess, Cossich & Sumich, Belle Chasse, LA, Attorneys for Respondents/Plaintiffs.
Wendell H. Gauthier, Scott LaBarre, Gauthier, Downing, LaBarre, Beiser & Dean, Metairie, Louisiana and Michael St. Martin, Joseph Jevic, St. Martin & Williams, Houma, LA, Carolyn A. McNabb, McNabb & Mire, Houma, LA, and Philip Cossich, Les Martin, Cossich, Sumich & Parisiola, Belle Chasse, LA Attorneys for Respondents/Plaintiffs on rehearing.
Court composed of Chief Judge ROBERT J. KLEES, Judge MIRIAM G. WALTZER, Judge JAMES F. McKAY III, Judge Pro Tempore PHILIP C. CIACCIO and Judge Pro Tempore JAMES C. GULOTTA.

Opinion:
I .WALTZER, Judge.
The state, defendant, seeks review of the denial of summary judgment. The state argues that a federal judgment, dismissing all claims by these same plaintiffs against the United States' government, precludes re-litigation of the same issues against the state in this second action.
FACTS AND PROCEDURAL HISTORY
Plaintiffs, oyster leaseholders/fishermen, filed the present class action on 29 March 1994 on behalf of all persons holding oyster leases on state water bottoms in Breton Sound. Plaintiffs alleged that a taking had occurred without just compensation in violation of the Fifth Amendment to the U.S. Constitution and-Article 1, § 4 of the Louisiana Constitution because their oyster leases were adversely affected by the freshwater outflow from the Caernarvon freshwater diversion structure, located on the east bank of the Mississippi River in Plaquemines Parish.
On 26 April 1994, Avenal and virtually all of the same representative plaintiffs in the pi'esent state suit, with some new ones, filed suit in the U.S. Court of Federal Claims against the United States and its agencies, including but not limited to the U.S. Army Corps of Engineers, which de signed, financed and built [ ¡>the Caernarvon freshwater diversion structure. In that suit, the plaintiffs alleged a taking under the Fifth Amendment to the U.S. Constitution, one of the two claims raised in the present suit, and sought a class certification.
Defendant in the federal suit moved for summary judgment on several grounds. The Court of Claims granted summary judgment in August 1995. On appeal to the Court of Appeals for the Fifth Circuit, that decision was affirmed in November 1996.
Following the Avenal Fifth Circuit decision, defendant in the present state suit filed a motion for summary judgment arguing that collateral estoppel barred the re-litigation of the issues decided by federal judgment. The trial court denied the motion for summary judgment on 5 January 1998, "for the reasons set forth at the hearing" held that same date. (No transcript of the hearing is attached to defendant's writ application.)
Both the Court of Claims and the Fifth Circuit decisions are rich in facts. The undisputed facts, as taken from those decisions, show that federal and state government action was being planned as far back as the 1950's and 1960's to divert freshwater from the Mississippi River into adjacent marsh lands to improve oyster habitats and to reduce the mortality rate associated with increased salinity levels. According to a 1959 memorandum by the U.S. Fish and Wildlife Service to the U.S. Army Corps of Engineers, this action would benefit existing oyster-rich marshlands which had, over time, become too saline as a result of man-made and natural causes. Based on that memorandum, in 1965 Congress authorized certain freshwater diversion structures to be built in and around the Breton Sound Basin, | ¡which lies east of the Mississippi River and south of New Orleans. In 1968, the Corps proposed Caernarvon as a situs for a freshwater diversion control structure.
During the 1970's, the zone favorable for oyster growth continued to move landward, due to salinity changes, spawning an oyster community in marshlands which had previously been too fresh to sustain such growth. However, this inland movement of salinity had the deleterious effect of rendering unusable large areas of previously productive oyster grounds. The evidence showed that the representative plaintiffs in the federal suit, with few exceptions, the same representative plaintiffs in the present state action, had acquired their leases for oyster farming at the earliest, in 1976. These leases covered those areas which had previously been unsuitable for oyster growth.
Between 1978 and 1982 the Corps and relevant state and local agencies continued to discuss at informal meetings the construction of a freshwater diversion structure at Caernarvon. The Corps issued a final report in September 1984, proposing that one large freshwater diversion structure be constructed at Caernarvon. In October 1986, Congress authorized funds for the construction of the Caernarvon project.
Although the State of Louisiana expressed its intent. to participate in the Caernarvon project as early as January 1982, the State did not enter into a formal agreement with the Corps until June 1987. The agreement provided that the State was to be responsible for 25 percent of the total costs of construction, and would maintain and operate the facilities following. construction. Construction of the Caernarvon freshwater diversion project commenced in June 1988 and was completed in February 1991. The Caernarvon project was modeled after smaller state and local diversion structures constructed in the 1950's and 1960's, which |4had proved effective in restoring oyster pro duction previously destroyed by excessive salinity levels.
Plaintiffs in both the federal suit and the present suit claim that the freshwater diverted from the Mississippi River by the Caernarvon project dilutes the salinity of the waters where their oyster leases are located, increases the growth of vegetation and bacteria on or near the water bottoms there, and causes silt to deposit there, rendering plaintiffs' leases incapable of oyster growth and cultivation.
In their motion for summary judgment filed in federal court, the United States alleged several grounds, including that the plaintiffs had no compensable expectancy in continued saltwater intrusion or a particular salinity level, and that the plaintiffs had no reasonable investment-backed expectations to continuation of the saltwater intrusion or a particular salinity level which was caused by earlier diversion of freshwater from its historic flows.
The Court of Claims ruled that the plaintiffs lacked a compensable property interest in the salinity of the water for purposes of the Fifth Amendment's taking clause and dismissed the suit. The Fifth Circuit affirmed that judgment on other grounds. The federal appellate court found that the plaintiffs did have a property interest, created by the state, which was protected by the Fifth Amendment, and that the federal and state project had altered the salinity conditions to the detriment of oyster cultivation. However, the court found that no compensable taking occurred since the plaintiffs had taken advantage of favorable conditions created by prior projects, and knew or should have known of the expected freshwater diversion that would adversely affect their oyster leases, and thus could not have |fihad a legitimate investment-backed expectation that conditions would remain favorable for oyster cultivation.
SUPERVISORY JURISDICTION
Clearly, the denial of a motion for summary judgment is an interlocutory judgment from which the parties do not have the right to appeal. LSA-C.C.P. art. 1841. However, our exercise of supervisory jurisdiction is purely discretionary. LSA-C.C.P. art. 2201.
In Scott v. Pontcharbrain Materials Corp., 98-1611, p. 3 (La.App. 4 Cir. 8/12/98), 717 So.2d 682, 684, this court stated:
Appellate courts must review summary judgments de novo. Act No. 483 of 1997 amended LSA-C.C.P. art. 966 effective August 15, 1997, and it is to be applied retroactively as well as prospectively. Perry Waller v. American Seafoods Co., 97-0302, p. 1 (La.App. 4 Cir. 10/1/97), 700 So.2d 1306, 1307, writ not considered, 97-2769 (La.1/30/98), 709 So.2d 693.
The summary judgment procedure is designed to secure the just, speedy, and inexpensive determination of actions such as this. The procedure is favored and shall be construed to accomplish these ends. LSA-C.C.P. art. 966 A(2). A summary judgment shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to a material fact, and that the mover is entitled to judgment as a matter of law. LSA-C.C.P. art. 966 B. However, if the movant will not bear the burden of proof at trial on the matter that is before the court on the motion for summary judgment, the movant's burden does not require him to negate all .essential elements of the adverse party's claim, but rather to point out to the court that there is an absence of factual support for one or more elements essential to the adverse party's claim. LSA-C.C.P. art. 966 C(2).
Id.
| (/'Thereafter, if the adverse party fails to produce factual support sufficient to establish that he will be able to satisfy his evidentiary burden of proof at trial, there is no gemine issue of material fact." LSA-C.C.P. art. 966 C(2).
Plaintiffs initially attack defendant's need for supervisory review, citing the lack of any showing of irreparable harm. LSA-C.C.P. art. 2083(A). However, because summary judgment is now favored, this court reviews denials of motions for summary judgments in all but the most exceptional cases. This ease does not present exceptional circumstances.
COLLATERAL ESTOPPEL
We must first consider the applicable law. Relators argue for application of federal law to determine the effect of this judgment rendered by a federal court. However, respondents argue for application of state law to this suit in state court.
We must apply federal law to determine the effect of the judgment, rendered in the federal action, on the proceedings in state court. Reeder v. Succession of Palmer, 623 So.2d 1268, 1271 (La.1993). We must apply federal law to "determine the pre-clusive effects of a judgment rendered by a federal court exercising federal question jurisdiction." Id. In the federal action, the fishermen sued under the United States' Constitution, and the federal court exercised its federal question jurisdiction. In Reeder, the Louisiana Supreme Court decided to apply federal law to determine the preclusive effect of a judgment from which the defendants asserted the defense of res judicata (or claim preclusion). Although we are asked to determine the preclusive effect, based on collateral estoppel (or issue preclusion) of a judgment, we are required to apply federal law.
Applying federal law to determine what effect the federal judgment has to this action, we consider the doctrine of collateral estoppel. Collateral estoppel |7requires the existence of three facts: (1) the issue at stake must be identical to ,the -one involved in the prior action; (2) the issue must have been actually litigated in the prior action; and (3) the determination of the issue in the prior action must have been a necessary part of the judgment in that earlier action. RecoverEdge, L.P. v. Pentecost, 44 F.3d 1284, 1291 (5th Cir.1995). Some cases recognize a fourth requirement for application of issue preclusion, that no special circumstances exist rendering preclusion inappropriate or unfair. Id., at Fn. 12. Collateral estoppel, unlike res judicata, does not require mutuality between the parties to the prior action and the parties in the subsequent action in which the defendants raise the issue of collateral estoppel. Blonder-Tongue Laboratories, Inc. v. University of Illinois Foundation, 402 U.S. 313, 91 S.Ct. 1434, 28 L.Ed.2d 788.
Respondents argue that no identity of issues exists in the two separate actions, that the parties did not actually litigate the issue, and that fairness precludes application of collateral estoppel. An identity of issues exists when the facts and. the legal standard used to assess the facts are the same in both proceedings. Copeland v. Merrill Lynch & Co., Inc., 47 F.3d 1415, 1422 (5th Cir.1995). In the federal action, a class of oyster fishermen sued, under the United States Constitution, the federal government for compensation for a taking. Basically, the lessees alleged that the Caernarvon freshwater diversion project, constructed by both the federal and state governments, damaged their property, decreased the economic potential of their leases. They argued that this project caused conditions unfavorable to oyster growth, decreasing the value of their leases. These same fishermen/lessees sued the State of Louisiana for these same damages in this state proceeding under both the United States and the Louisiana Constitutions. We are presented in this action with the same plaintiffs seeking the | Ssame remedy for the same harm from a different defendant. Therefore, the facts in the federal action and the facts in this proceeding are exactly the same.
Essentially, we must determine whether the legal standard applied to the same facts in the federal action is the same legal standard applicable in this action. The United States and Louisiana Constitutions prevent takings by government entities without compensation. The Fifth Amendment of the United States Constitution provides that "private property [shall not] be taken for public use, without just com-pénsation." The Louisiana Constitution likewise provides:
Every person has the right to acquire, own, control, use, enjoy, protect, and dispose of private property. This right is subject to reasonable statutory restrictions and the reasonable exercise of the police power. Property shall not be taken or damaged by the state or its political subdivisions except for public purposes and with just compensation paid to the owner or into court for his benefit.
LSA-Const. Art. 1, § 4.
The federal constitutional provision protects against takings by both federal and state governments. However, the Louisiana Constitution does not protect against takings by the federal government. The Louisiana Constitution guarantees fewer protections against public takings than the United States Constitution. State Through Department of Transportation and Development v. Chambers Inv. Co., 595 So.2d 598, 604 (La.1992). Louisiana courts have consistently considered federal law in analyzing whether particular facts constitute a taking of property in similar inverse condemnation suits. Louisiana Seafood Management v. Louisiana Wildlife and Fisheries Commission, 97-1367 (La.5/19/98); 715 So.2d 387, 392-93; Ursin v. New Orleans Aviation Board, 506 So.2d 947, 955 (La.App. 5 Cir. 4/15/87), reversed for different reasons by 515 So.2d 1087 (La.1987); Annison v. Hoover, 517 So.2d 420, 423 (La.App. 1 Cir. 12/22/87); writ denied by (La.2/12/88), 519 So.2d 148; Layne v. City of Mandeville, 633 So.2d 608, 610 (La.App. 1 Cir. 12/29/93), writ denied by 94-0268 (La.3/25/94); 635 So.2d 234; Standard Materials, Inc. v. City of Slidell, 96-0684 (La.App. 1 Cir. 9/23/97); 700 So.2d 975, 984. Clearly, a distinction exists between claims for inverse condemnation and claims for expropriation. Louisiana courts have explicitly recognized this distinction. State, Through Department of Transportation and Development v. Chambers Inv. Co., supra at 602. Moreover, in determining whether a state law so limited the use of certain property to constitute a constitutional taking, the Louisiana Supreme Court recently addressed whether fishermen owning gill nets "have a justifiable investment backed reliance interest." Louisiana Seafood Management v. Louisiana Wildlife and Fisheries Commission, 97-1367 (La.5/19/98); 715 So.2d 387, 393. [Emphasis added.] That Court cited federal authority in its analysis of whether the gill net owners/fishermen suffered a taking because the new law "diminished the economic value of their equipment." Id., at 392.
In the lessees' federal action, the court of appeals reasoned:
When government limits the use a property owner may make of her property, without itself occupying or using the property for government purposes, the classic analytical tool for assessing whether a taking has occurred is the three-part test enunciated by the Supreme Court in Penn Central Transportation Co. v. City of New York, 438 U.S. 104, 98 S.Ct. 2646, 57 L.Ed.2d 631 (1978): the court considers the character of the governmental action, the economic impact on the claimant and, particularly, the extent to which the governmental action has interfered with distinct investment-backed expectations. Id., at 124, 98 S.Ct., at 2659. Though it is a truism that "no set formula exists to determine whether compensation is con stitutionally required for a government restriction of property." Hendler v. United States, 952 F.2d 1364, 1373 (Fed.Cir.1991), see Penn Central, 438 U.S., at 124, 98 S.Ct., at 2659, 57 L.Ed.2d 631, the Penn Central formulation provides Imguidance in analyzing what the trial court here viewed as a question of first impression.
The case before us presents a textbook example of a situation in which the plaintiffs, in the face of established public concerns and while governmental efforts to address those concerns were well known, moved to take advantage of the existing conditions for their own economic benefit. There is nothing wrong with their having done that; the State of Louisiana provided the mechanism for it, and their own initiative gave them whatever economic advantages the situation afforded. It is hard for them to claim surprise, however, that the preexisting salinity conditions, created at least in part by earlier government activity, were not left alone, but were again tampered with to their (this time) disadvantage.
Avenal v. United States, 95-5149 (Fed.Cir.11/12/96); 100 F.3d 933, 937. Furthermore, the federal appeals court held, "these plaintiffs, in the words of Penn Central, cannot have had reasonable investment-backed expectations that their oyster leases would give them rights protected from the planned freshwater diversion projects of the state and federal governments." Id. [Emphasis added.] Our review of the record and the applicable law persuades us that the issue decided in the federal action and the issue confronting the state court in this proceeding are identical. Therefore, we conclude that an identity of issues exists.
Respondents also argue that collateral estoppel does not apply to preclude re-litigation of their claims because the issue of whether they had reasonable investment-backed expectations, constituting a taking, was not actually litigated. Collateral estoppel is unavailable when a "new determination of the issue is warranted by differences in the quality or extensiveness of the procedure followed! in the two courts." Copeland, supra at 1423. [Emphasis added.] Respondents do not argue that the procedures employed by the federal court, as opposed to those procedures employed by the state court, differ. They do not even argue that the issue decided from the record on appeal was not "actually litigated." They argue only that we should disregard the federal judgment because the trial In court based its conclusion on one reason, and the appeals court decided the case on another issue. We believe that the parties -actually litigated whether plaintiffs' "property interest was taken." Avenal, supra at 936.
Respondents argue that we should not apply the doctrine of collateral estoppel since special circumstances exist. We must consider "whether the party against whom an estoppel is asserted had'a full and fair opportunity to litigate." Blonder-Tongue Laboratories, Inc., supra at 329, 91 S.Ct., at 1443. The special circumstances upon which the respondents rely involve alleged errors in factual conclusions by the federal court of appeals because, as they contend, the record on appeal was incomplete. They do not allege that the federal proceedings denied them an "opportunity to litigate." Moreover, plaintiffs do not argue that the alleged circumstances resulted from the conduct of others. Jenkins v. State, 615 So.2d 405, 407 (La.App. 4 Cir.1993), writ denied by 617 So.2d 932. We, do not believe that special circumstances exist.,
CONCLUSION
Applying federal law' to determine whether the doctrine of. collateral estoppel precludes re-litigation of plaintiffs' claims for compensation for the diminution of the value of their oyster bed leases, we conclude that an issue necessary to their claims for relief in. the state action was previously litigated and decided in the federal action. Accordingly, for the reasons discussed, we reverse the judgment of the trial court and dismiss the plaintiffs' claims under both the United States and Louisiana Constitutions, since the federal judgment precludes re-litigation of an issue which a federal court has already decided.
WRIT GRANTED, JUDGMENT REVERSED.
KLEES, C.J., concurs and dissents for the reasons assigned by Judge McKAY.
McKAY, J., concurs in part and dissents in part.
. Avenal v. United States, 33 Fed. Cl. 778 (1995).
. Avenal v. United States, 100 F.3d 933 (5th Cir.1996).
. Respondents rely on several expropriation cases to argue that the legal standard applicable to the facts in this state proceeding differs from the legal standard applicable in the federal proceeding. Expropriation proceedings are governed by LSA-R.S. 19:1, et seq. These statutes do not govern claims for inverse condemnation.