Opinion ID: 203942
Heading Depth: 3
Heading Rank: 2

Heading: Effect on FMH's Investment-Backed Expectations

Text: As for FMH's investment-backed expectations, we first reject an argument made by the defendant. Harvey argues the hospital's non-profit status eliminates any influence this factor has in FMH's favor. [7] We disagree very much with Harvey's proposed categorical approach. While there may be differences in degree between expectations for for-profit institutions and non-profit institutions, there is no categorical exclusion of non-profit institutions from this prong of the analysis. Like a for-profit institution, FMH acquires property with the expectation that it may use it for a particular purpose. Indeed, Maine law expressly recognizes the right of non-profit corporations to acquire, own, use, improve, and convey property like any other property owner. [8] See Me.Rev.Stat. Ann. tit. 13-B, § 202(1)(I). To the extent that Maine's free care laws may force FMH to use its property in ways that it would not otherwise, they may interfere with FMH's investment-backed expectations. It is true that FMH's investment-backed expectations are tempered by the fact that it operates in the highly regulated hospital industry. [9] See United Wire, Metal & Mach. Health & Welfare Fund v. Morristown Mem'l Hosp., 995 F.2d 1179, 1191 (3d Cir.1993) (rejecting a takings challenge to New Jersey's system of setting hospital billing rates, in part, because the plaintiffs' investment-backed expectations were reduced by the historically heavy and constant regulation of health care in the state). And the Supreme Court has recognized that heavy government regulation may diminish a property owner's expectations. See Lucas, 505 U.S. at 1027-28, 112 S.Ct. 2886 (It seems to us that the property owner necessarily expects the uses of his property to be restricted, from time to time, by various measures newly enacted by the State in legitimate exercise of its police powers.... And in the case of personal property, by reason of the State's traditionally high degree of control over commercial dealings, he ought to be aware of the possibility that new regulations might even render his property economically worthless....).