Opinion ID: 691029
Heading Depth: 2
Heading Rank: 2

Heading: Alleged Per Se Taking

Text: 39 Sage further argues that the court erred in failing to find that a per se taking occurred when the government denied Sage access to the premises at 767 Third Avenue. Sage bases its argument on the terms of the notice posted by the Treasury Department at the premises. Analogizing the present case to Loretto, 458 U.S. at 419, 102 S.Ct. at 3167, and Skip Kirchdorfer, Inc. v. United States, 6 F.3d 1573 (Fed.Cir.1993), Sage asserts that the government, by posting a sign that warned potential trespassers of severe criminal and civil penalties, effectively occupied the premises. According to Sage, such action was the functional equivalent of placing armed troops at the doors. Therefore, Sage asserts that the government's actions were compensable as a per se taking as a matter of law. We disagree. 40 The Supreme Court has described two categories of regulatory action that constitute per se takings requiring compensation without case-specific inquiry into the public interest advanced in support of the restraint. Lucas v. South Carolina Coastal Council, --- U.S. ----, ----, 112 S.Ct. 2886, 2893, 120 L.Ed.2d 798 (1992). First, regulations that compel any permanent physical occupation of an owner's property require compensation. Id.; see also Loretto, 458 U.S. at 426, 102 S.Ct. at 3171 (New York law requiring landlords to place cable facilities in apartment buildings was a permanent physical occupation and thus constituted a compensable taking); Skip Kirchdorfer, 6 F.3d at 1582 (government's physical occupation of warehouse constituted a compensable taking). Second, regulations that deny all economically beneficial or productive use of land also require compensation. Lucas, --- U.S. at ----, 112 S.Ct. at 2893; see also Loveladies Harbor, Inc. v. United States, 28 F.3d 1171, 1182 (Fed.Cir.1994) (denial of permit to fill land for development purposes constituted a total taking of owner's property interest). 41 Neither has occurred here and Sage's reliance on Loretto and Skip Kirchdorfer is misplaced. In Loretto, the Supreme Court held that a New York statute requiring a landlord to permit installation of cable television facilities on the landlord's property constituted a permanent physical occupation of property. The installation involved a direct physical attachment of plates, boxes, wires, bolts, and screws to the building, completely occupying space [on] the roof and along the building's exterior wall. Loretto, 458 U.S. at 438, 102 S.Ct. at 3177. The court found that such government action is of such a unique character that it is a taking without regard to other factors that a court might ordinarily examine. Id. at 432, 102 S.Ct. at 3174. In Skip Kirchdorfer, this court held that the government's seizure and occupation of a building constituted a per se taking. The government had physically taken the premises, complete with broken locks at early morning hours. Skip Kirchdorfer, 6 F.3d at 1582. After physically taking the premises, the government posted guards at the entrance and controlled access to the building. Id. at 1577. 42 The government's actions in this case, however, are not comparable. The government did not physically occupy the premises at 767 Third Avenue. Putting aside the fact that the notices were in effect for less than three months, the locks were not changed, the doors were not broken down, a guard was not placed at the door. No plates, boxes, wires, or bolts were attached to the premises. Sage was granted access to the building the only time it requested access. We do not agree that the placing of a notice on the door of the premises was the functional equivalent of placing armed troops at the doors. Although the notice was backed by the force of law, it did not physically prevent Sage from entering the premises, and access was available when requested. Because the government did not physically occupy the premises at 767 Third Avenue, the government's actions did not rise to the level of a per se Loretto-type physical taking. 43 Further, we agree with the government that, if anything, the posting of the notice imposed only a non-compensable regulatory scheme that blocked access to the premises without authorization. 6 The Supreme Court has stated that the mere assertion of a regulatory jurisdiction by a governmental body does not constitute a regulatory taking. United States v. Riverside Bayview Homes, Inc., 474 U.S. 121, 126, 106 S.Ct. 455, 459, 88 L.Ed.2d 419 (1985). Moreover, [o]nly when a permit is denied and the effect of the denial is to prevent 'economically viable' use of the land in question can it be said that a taking has occurred. Id. at 127, 106 S.Ct. at 459. It is true that, in this case, the government barred access to the premises without permission, rather than just restricting use of the premises. Nevertheless, we do not believe it can be said that the government's actions denied Sage all economically viable use of its property. We do not know what uses could have been made of the property during the short period of time the notices were posted. We do know, however, that the government did not deny Sage the one request it made concerning use of the property. It is also clear that the government's actions were directed to keeping the SFRY organizations out of the property, not preventing use by Sage. Since the SFRY organizations had terminated their leases, Sage might well have made other uses of the offices. It failed to request any such uses, however. Sage's failure to explore all possibilities serves to bar any regulatory taking claim. See Tabb Lakes, 10 F.3d at 801 (As a matter of law, the possibility of a permit precludes the order itself from constituting a taking. Plaintiff was not precluded from development; it was precluded from development without a permit.) (citation omitted). 44 We have considered all the other arguments raised by Sage, but find them not persuasive.