Court Opinion

ID: 6339011
Source: CourtListenerOpinion
Date Created: 2022-05-10 13:01:08.478964+00
Date Added: 2024-06-11T15:49:10.021444
License: Public Domain

In the United States Court of Federal Claims
                                     No. 21-776 L
                                  Filed: May 9, 2022
 ________________________________________
                                                )
 SCHELL & KAMPETER, INC., et al.,               )
                                                )
                      Plaintiffs,               )
                                                )
    v.                                          )
                                                )
 THE UNITED STATES,                             )
                                                )
                      Defendant.                )
 ________________________________________ )

Meghan S. Largent, Lewis Rice, LLC, St. Louis, MO, with whom was Lindsay S.C. Brinton,
Lewis Rice, LLC, St. Louis, MO, of counsel.

Joseph H. Kim, United States Department of Justice, Environment & Natural Resources
Division, Washington, D.C., with whom was Todd Kim, Assistant Attorney General, United
States Department of Justice, Environment & Natural Resources Division, Washington, D.C., of
counsel.

                                    OPINION AND ORDER

MEYERS, Judge.

        Schell & Kampeter, Inc., SNK Real Property Holdings, LLC, and Sugar Creek Pet Foods
own property in Osage and Miller Counties in Missouri, some of which is subject to a railroad
right-of-way. They seek just compensation for the Government’s alleged taking of their property
when it converted the railroad right-of-way into a recreational trail. While SNK identified
certain properties by their tax parcel identification numbers, it inadvertently omitted this
identification for three parcels. Before SNK realized it hadn’t included all the relevant tax parcel
identification numbers, the statute of limitations expired. And the Government refuses to engage
with SNK regarding these three parcels because the statute of limitations has expired. SNK
seeks to amend the Complaint to add these tax parcel identification numbers for the three parcels
it did not include in the Complaint. The Government opposes SNK’s motion, arguing that the
statute of limitations prohibits SNK from adding new parcel identification numbers to its
Complaint because those would be new, time-barred claims. The Government’s argument rests
on its belief that this Court’s Rule 9(i) requires SNK to specifically identify in the Complaint
each parcel of property it alleges to have been taken. Because Rule 9(i) does not impose a
heightened pleading standard and SNK’s allegations easily satisfy the notice pleading
requirements of Rule 8, SNK’s proposed amendment does not implicate the statute of
limitations. It is, in fact, unnecessary. In any event, the amendment would relate back to the
Complaint and thus be timely as well. Therefore, the Court grants SNK’s motion to amend the
Complaint.

I.      Background

        Each of the plaintiffs alleges that it owns various real property in Miller and Osage
Counties, Missouri. ECF No. 1 ¶¶ 24-26. During the late 19th and early 20th centuries, a
railroad 1 company established a railroad right-of-way between St. Louis and Kansas City. Id. ¶
4. According to Plaintiffs, the right-of-way ran across an exclusive easement for railroad use
that would extinguish if the railroad ceased using it for rail purposes. Id. ¶¶ 6, 19-21, 34, 36.
The railroad stopped using the right-of-way long ago and the Government invoked the Trails Act
to convert the right-of-way into a recreational trail.

        Plaintiffs seek just compensation for the Government’s alleged taking of their property
resulting from the conversion of the reversionary interest in the easement. In the Complaint,
each plaintiff identifies the property it alleges the Government has taken. Id. ¶¶ 24-26. Because
only SNK brings this motion, the Court focuses only on its allegations. SNK identifies the
property it claims was taken as follows:

               SNK Real Property Holdings, LLC owned land in Miller County
               on February 26, 2015. The [Surface Transportation Board
               (“STB’s”)] order of February 26, 2015 (Ex. 14) caused a partial
               taking of Schell & Kampeter’s 2 land including, but not limited to,
               the following tax parcels (identification numbers assigned by the
               Miller County, Missouri assessor): 08-1.0-02-000-000-002.001,
               08-1.0-02-000-000-005.002, and 08-1.0-02-000-000-001-000.

Id. ¶ 25.

        The Parties here have engaged in preliminary discovery regarding title and liability
issues. As part of this process, Plaintiffs provided all of their title information but the
Government refused to discuss any parcel not specifically identified in the Complaint. Plaintiffs
now seek leave to file an amended complaint pursuant to Rule 15(a)(2) of the Rules of the Court
of Federal Claims (“RCFC”). ECF No. 20 at 1. Specifically, Plaintiffs seek leave to add three
additional parcel identification numbers that were “inadvertently omitted from the original
complaint.” Id. The proposed Amended Complaint is otherwise identical to the original
complaint. Id. The Government opposes amendment because it contends that SNK is trying to
bring new claims after the statute of limitations has expired. ECF No. 23.

II.     Discussion

1
 As in many of the rails-to-trails cases, the initial railroad’s interest in the right-of-way passed to
several successors in interest. Because the identity of the railroad company is irrelevant to the
present motion, the Court refers simply to the “railroad.”
2
 This appears to be a typographical error. Paragraph 25 addresses SNK’s property, not Schell &
Kampeter’s.

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        Because SNK’s motion comes more than 21 days after service of the Government’s
Answer and the Government opposes amendment, SNK may only amend the Complaint by leave
of Court, which “[t]he court should freely give leave when justice so requires.” RCFC 15(a)(2).
It is well-settled that the granting of leave to amend a pleading under RCFC 15(a) is within the
discretion of the trial court. Kudu Ltd. II, Inc. v. United States, 153 Fed. Cl. 790, 794 (2021)
(citing Meyer Grp., Ltd. v. United States, 115 Fed. Cl. 645, 649 (2014). Absent unusual
circumstances, the Court will normally grant such leave to amend. See Mitsui Foods, Inc. v.
United States, 867 F.2d 1401, 1403-04 (Fed. Cir. 1989) (listing reasons for denying a motion to
amend as undue delay, bad faith, dilatory motive, failure to cure deficiencies, undue prejudice to
nonmoving party, or futility of amendment).

       The key issue before the Court is what RCFC 9(i) required SNK to plead in its
Complaint. The core of the Government’s opposition to amendment is its belief that RCFC 9(i)
imposes a heightened pleading standard that required SNK to plead the specific parcels or real
property it claims the Government took in this case. ECF No. 23 at 2. And, according to the
Government, SNK’s failure to do so before the statute of limitations expired renders its new
“claims” as to these three parcels untimely. “Not so.” United Affiliates Corp. v. United States,
143 Fed. Cl. 257, 263 (2019).

        As Judge Wheeler explained, RCFC 9(i) does not impose a heightened pleading standard
for takings claims. RCFC 9(i) simply reflects the two-part analysis that this Court will conduct
when we turn to the merits to determine whether a compensable taking has occurred. First, the
Court will look to see if SNK has “‘identified a cognizable Fifth Amendment property interest’”
that SNK claims to have been taken. Id. at 262 (quoting Acceptance Ins. Cos., Inc. v. United
States, 583 F.3d 849, 854 (Fed. Cir. 2009)). Second, if the Court concludes SNK has identified
such an interest, it will decide whether the Government did, in fact, take that property interest.
Id. Thus, RCFC 9(i) provides that: “In pleading a claim for just compensation under the Fifth
Amendment of the United States Constitution, a party must identify the specific property interest
alleged to have been taken by the United States.”

        Properly understood, RCFC 9(i) serves “to guide a prospective plaintiff’s pleading.”
United Affiliates, 143 Fed. Cl. at 263. Like other claims, a Fifth Amendment takings claim needs
only to satisfy RCFC 8’s notice pleading standard elucidated in Bell Atl. Corp. v. Twombly, 550
U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662 (2009). Therefore, SNK “must only plead
facts that, when accepted as true, show that [it] hold[s] a property interest, and that the
Government took that interest.” United Affiliates, 143 Fed. Cl. at 262. In other words, SNK
needed only to plead “a basic statement of the property interests at issue.” Id. at 263 (citing In re
Upstream Addicks & Barker (Texas) Flood-Control Reservoirs, 138 Fed. Cl. 658, 669 (2018)).
As Judge Lettow explained, “there is no need [in the complaint] for a plaintiff to separately
identify” each piece of property it claims was taken. In re Upstream, 138 Fed. Cl. at 669. That
is what discovery is for.

        SNK pleaded that it was the owner of real property in Miller County, Missouri, on the
date the Government authorized the conversion of the railroad right-of-way into a recreational
trail. ECF No. 1 ¶ 25(“SNK Real Property Holdings, LLC owned land in Miller County on
February 26, 2015. The STB’s order of February 26, 2015 . . . caused a partial taking of [SNK’s]
land including, but not limited to . . . .”). According to the Complaint, the right-of-way ran

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across an easement was limited to railroad use would revert to SNK and the other Plaintiffs if the
railroad ceased to use it for rail purposes. Id. ¶ 5. And when the Government authorized the
conversion to trail use, it “invalidated these owners’ Missouri state-law right to unencumbered
title and exclusive possession of their land.” Id. ¶¶ 19, 28. In short, SNK has alleged its specific
property right—the unencumbered title to real property (after four decades of rails-to-trails
litigation, this is unquestionably a “cognizable Fifth Amendment property interest”)—that it
alleged the Government took when it authorized the conversion of the railroad’s right-of-way
into a recreational trail. That is all that was required.

        SNK pleaded its specific property interest and how the Government allegedly took it.
SNK was not required to include any further specificity regarding specific parcels it claims the
Government took in its Complaint. See ECF No. 20 at 4 (arguing that amendment is likely
unnecessary). In other words, SNK clearly satisfied RCFC 8’s notice pleading. And, critically,
SNK alleged that the Government’s taking applied to the parcels with tax identification numbers
“including, but not limited to” those listed in paragraph 25 of the complaint. ECF No. 1 ¶ 25
(emphasis added). Therefore, the addition of additional parcels’ tax identification numbers does
not add claims to the Complaint, it merely adds specificity. And RCFC 15’s permissive standard
is easily met here.

        Even if RCFC 9(i) imposed a heightened pleading standard, the proposed amendment
relates back to the initial pleading and is, therefore, timely. An amended pleading relates back to
and is considered to have been filed when the original pleading was filed if “the amendment
asserts a claim or defense that arose out of the conduct, transaction, or occurrence set out—or
attempted to be set out—in the original pleading.” RCFC 15(c)(1)(B). Here, the inquiry is
whether “the operative facts in the original complaint . . . put the government on notice.”
Santana on behalf of Santana v. United States, 155 Fed. Cl. 57, 69 (2021); see also Fauvergue v.
United States, 85 Fed. Cl. 50, 54 (2008) (noting the relevant inquiry focuses on the notice given
to the defendant by the factual assertions set forth in the original pleading). This notice-based
understanding of RCFC 15 asks a court to determine “whether the general factual situation or the
aggregate of operative facts underlying the original claim for relief gave notice to [the defendant]
of the nature of the allegations it was being called upon to answer.” Anza Tech., Inc. v. Mushkin,
Inc., 934 F.3d 1359, 1369-70 (Fed. Cir. 2019); see also Snoqualmie Tribe of Indians ex rel.
Skykomish Tribe of Indians v. United States, 372 F.2d 951, 961 (Ct. Cl. 1967) (construing RCFC
15 to “permit an amended pleading to relate back where there is sufficient notice.”).

        SNK argues that its proposed Amended Complaint relates back to the Complaint because
it does not add a new claim, the relief sought is identical in the original and amended complaint,
and the facts alleged are identical in both. ECF No. 20 at 3-4. SNK further contends that the
Amended Complaint seeks to “amplify and particularize” the property interest alleged in the
original complaint. Id. at 4. 3 The Government responds that the relation back doctrine does not
apply because Plaintiffs are attempting to “add new claims that are time barred by the applicable
statute of limitations.” ECF No. 23 at 1. The Government’s argument, however, would render

3
 SNK also seeks to characterize the Amended Complaint as seeking to correct a “clerical
mistake.” ECF No. 20 at 4-5. Because the Court resolves the motion on other grounds, it does
not opine on whether the omission of tax identification numbers qualifies as a clerical mistake.

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the entire relation back doctrine a nullity because amendments before the expiration of the statute
of limitations expire have no need to relate back to anything. That is not the law. E.g., State of
Alaska v. United States, 32 Fed. Cl. 689, 698 (1995) (“If an amended complaint states a claim
which arises from the same conduct, transaction, or occurrence (and especially if it states the
same claim arising from the same events) as set forth in the original complaint, then it must be
considered timely if the original complaint was filed within six years from the date upon which
that claim accrued.”) (emphasis in original).

        And the court’s opinion in State of Alaska is instructive here. There, the court permitted
the plaintiff to file an amended complaint under the relation back doctrine for several reasons.
Id. at 698. First, the amended complaint and original complaint both arose out of the same
conduct, transaction, or occurrence. Id. That is true here as well. Second, the amended and
original complaints both sought just compensation for taking of property, and both complaints
also sought identical relief and damages. Id. That, too, is true here as well. Finally, the
amended complaint frequently quoted the original complaint verbatim. Id. Considering these
factors, the court concluded that the amended complaint was simply recharacterizing the
property interest that was allegedly taken. Id. The court therefore held that the amended
complaint related back to the date of the original complaint under RCFC 15(c). Id.

         Here, Plaintiffs’ amended complaint arises out of the same conduct, transaction, and
occurrence as the original complaint. Both allege a Fifth Amendment takings claim that
occurred on February 26, 2015, when the STB issued the NITU. The amended complaint seeks
the same relief as the original complaint—just compensation for the property that was allegedly
taken when the Government authorized the conversion of the right-of-way into a recreational
trail. In fact, the only difference between the amended complaint and the original complaint is
the addition of the three parcel identification numbers. Accordingly, the Court can readily
conclude that Plaintiffs’ amended complaint simply adds specificity the claim in the original
complaint.

        And given the Court’s resolution of the RCFC 9(i) issue, this case also fits within the
holding of Fadem v. United States, 13 Cl. Ct. 328 (1987), which held that an amended complaint
satisfies the relation back doctrine when it expands or amplifies what was alleged in the original
complaint. ECF No. 20 at 3. In Fadem, the plaintiffs’ original complaint alleged “that their
entire property has been taken by the United States Government for public use.” Fadem, 13 Cl.
Ct. at 335 (emphasis in original). Then the plaintiffs amended their complaint to specify that, if a
government resurvey of the property was valid, the Government took 43 acres of their land. Id.
The amendment “‘merely expanded or amplified what was alleged in support of the cause of
action already asserted.’” Id. (quoting Seaboard Air Line Ry. v. Renn, 241 U.S. 290, 293
(1916)). The court in Fadem concluded that the capacious language used in the original
complaint, e.g., “entire property,” put the Government on notice of the allegations against it
because “entire property” included the 43 acres omitted from the original complaint. Id. Here,
Plaintiffs alleged that the STB’s February 26, 2015, order “caused a partial taking of [SNK’s]
land including, but not limited to” the specified parcels. ECF No. 1 ¶ 25 (emphasis added). Like
in Fadem, the language “including, but not limited to” in the original complaint put the
Government on sufficient notice of the allegations against it. The inclusion of the tax parcel
identification numbers “merely expanded or amplified what was alleged in support of the cause
of action already asserted.” Fadem, 13 Cl. Ct. at 335 (citations omitted).

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        The Court holds that although the amended complaint is unnecessary, it relates back to
the original complaint because the amended complaint merely adds specificity the original claim,
and because the Amended Complaint amplifies and particularizes the original pleading. Thus,
the Court grants Plaintiffs leave to file an amended complaint insofar as it seeks to add the three
tax parcel identification numbers.

III.   Conclusion

         Plaintiffs’ motion to amend, ECF No. 23, is GRANTED and the Court orders Plaintiffs
to file their amended complaint on the docket. The Parties shall file a joint status report on or
before May 16, 2022, regarding the scheduling of further proceedings in in this matter.

IT IS SO ORDERED.

                                                             s/ Edward H. Meyers
                                                             Edward H. Meyers,
                                                             Judge

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