Opinion ID: 783502
Heading Depth: 3
Heading Rank: 2

Heading: Categorical Taking

Text: 21 Having concluded that Maritrans has a cognizable property interest, we must determine whether the government interfered with that interest in a way that resulted in a compensable taking. In that regard, we consider first whether a categorical taking occurred. See Rith Energy, 247 F.3d at 1362. As noted above, a categorical taking is defined as one in which all economically viable use, i.e., all economic value has been taken by the regulatory imposition. Palm Beach Isles Assocs., 231 F.3d at 1357. 22 The Supreme Court stated in Lucas that total deprivation of beneficial use is, from the landowner's point of view, the equivalent of a physical appropriation. Lucas, 505 U.S. at 1017, 112 S.Ct. 2886. The Court further stated that regulations that leave the owner of land without economically beneficial or productive options for its use ... carry with them a heightened risk that private property is being pressed into some form of public service under the guise of mitigating serious public harm. Id. at 1018, 112 S.Ct. 2886. The Court concluded that when the owner of real property has been called upon to sacrifice all economically beneficial uses in the name of the common good, that is, to leave his property economically idle, he has suffered a taking. Id. at 1019, 112 S.Ct. 2886. Thus, in determining whether a categorical taking occurred in this case, we must decide whether Maritrans was called upon to sacrifice all economically beneficial uses of its single hull tank barges. In conducting our inquiry, we recognize that the owner's opportunity to recoup its investment or better, subject to the regulation, cannot be ignored. Rith Energy, 247 F.3d at 1363 (quoting Fla. Rock Indus., Inc. v. United States, 791 F.2d 893, 905 (Fed.Cir.1986)). 23 In concluding that Maritrans had not suffered a categorical taking, the Court of Federal Claims considered the fact that Maritrans was able to use its barges for several years before OPA90 took effect and that it was able to sell, rebuild, or receive insurance proceeds from all of the vessels at issue. Maritrans, 51 Fed.Cl. at 281. The court therefore found that Maritrans had not been deprived of all economically beneficial use of its barges. Id. Maritrans argues, however, that it did suffer the loss of such use. It claims that there is no commercially viable use for the barges if they cannot carry oil, and that their scrap value is negligible. Under these circumstances, it contends, OPA90 resulted in a complete, 100% taking of the useful life of the barges for the periods of time that ensued after their various retirement dates under the statute. Maritrans argues that it was not able to obtain full pre-OPA90 value for the five barges that it sold, the Ocean 90, the Ocean 96, the Ocean 115, the Ocean 135, and the Ocean 155. It also argues that, on account of OPA90, it was not able to insure for its full value the Ocean 255 (the barge that was a casualty loss). As far as the Ocean 192 and the Ocean 244 (the two barges that were retrofitted with double hulls) are concerned, Maritrans contends that, when it rebuilt these vessels, the original single hull barges were destroyed and, in effect, it built and purchased two new double hull vessels. 24 Taking away a property's most beneficial use does not by itself constitute a compensable taking. Andrus, 444 U.S. at 65-66, 100 S.Ct. 318. In Andrus, the Court stated that [a]t least where an owner possesses a full `bundle' of property rights, the destruction of one `strand' of the bundle is not a taking. Id. Only where Congress takes away every beneficial use does a categorical taking occur. Id. In this case, OPA90 took away one strand of Maritrans' bundle of property rights by putting limitations on Maritrans' use of its single hull tank barges on the navigable waters of the United States. OPA90 did not deprive Maritrans of 100% of the beneficial uses of its barges, however. Maritrans used and received income from its barges from its shipping operations in Jones Act trade prior to the OPA90 retirement dates. Additionally, it was able to recoup substantial sums of its original investment in the eight barges at issue in this case. Maritrans was able to sell five of its single hull tank barges, the Ocean 90, the Ocean 96, the Ocean 115, the Ocean 135, and the Ocean 155, for nearly 100% of their original cost, and following the collision of the Ocean 255, it was able to recover insurance proceeds in the amount of $7.8 million. In addition, Congress left Maritrans with other options besides selling its vessels or collecting insurance proceeds. The statute contemplates that shipping companies, such as Maritrans, can retrofit their single hull vessels to double hull vessels and continue to operate in Jones Act trade after scheduled retirement dates. Maritrans took advantage of this option for two of its vessels and will be able to continue using them to transport oil. Although this option imposes substantial costs, Maritrans has not established that retrofitting is not viable for any of its vessels. The fact that Maritrans' return on its investment may now be less than it originally expected is not enough to make Congress' enactment of OPA90 a compensable taking. 25 In urging that it experienced a categorical taking, Maritrans argues that the Court of Federal Claims erred in considering the entire timeframe during which Maritrans owned the tank barges alleged to have been taken. See Maritrans, 51 Fed.Cl. at 280. Maritrans claims that, instead, the court should have considered two separate periods, the period before and the period after the OPA90 retirement dates, and then looked at the impact in each period separately when it conducted its takings analysis. It asserts that, after the various retirement dates, all of the economic value of the vessels will be lost, and that, therefore, a categorical taking occurred. 26 We do not agree with Maritrans' argument. A similar situation presented itself in Rith Energy. There, the claimant urged us to isolate the commercial activity that took place after the revocation of its mining permit from the commercial activity that occurred before the revocation. We declined to do so. 27 Rith argues that the permit revocation deprived it of all of its remaining property, i.e., 100 percent of the coal that was left in the ground. We reject that argument.... As we explained in our initial opinion, it is artificial to divide the interests in the coal lease in the way that Rith proposes and to disregard the coal that had already been mined under the permit [before it was revoked].... The effect of the regulatory action in this case was to permit Rith to take some coal from the property that was the subject of its leases and then to prohibit it from taking any more. The course of regulatory action, viewed as a whole, did not deprive Rith of all the economic value in its coal leases and thus did not constitute a categorical taking of Rith's property. 28 Rith Energy, 270 F.3d at 1349-50. 29 We think that Rith Energy disposes of Maritrans' temporal argument. Just as the claimant in Rith Energy could not divide the term of its coal lease into two separate periods, one before and one after the governmental action allegedly effecting a taking, so here Maritrans may not confine the takings analysis for its tank barges to the various periods following the retirement dates mandated by OPA90 in order to argue that there were categorical takings during those periods. 6