Ladd v. United States

630 F.3d 1015, 2010 U.S. App. LEXIS 25443, 2010 WL 5230890
Court of Appeals for the Federal Circuit·Decided December 14, 2010·No. No. 2010-5010·Published·Cited by 105 cases

Opinion

MOORE, Circuit Judge.

The appellants appeal an order of the Court of Federal Claims granting summary judgment that no compensable taking occurred when the Department of Transportation’s Surface Transportation Board (STB) issued a Notice of Interim Trail Use or Abandonment concerning an easement over the appellants’ land. Because the court’s order conflicts with Caldwell v. United States, 391 F.3d 1226 (Fed.Cir.2005) and Barclay v. United States, 443 F.3d 1368 (Fed.Cir.2006), we reverse.

Background

The appellants own land in Cochise County, Arizona near the United States-Mexico border. In 1903, the El Paso & Southwestern Railroad Company (El Paso) acquired the right to use a 100-feet wide, 76.2-mile long strip of land to build and operate a railroad, pursuant to the General Railroad Right-of-Way Act of 1875, 43 U.S.C. §§ 934-39 (1875 Act), and various private conveyances. According to the appellants, they retained fee simple estates in the portions of their land underlying the railway.

In 2003, the San Pedro Railroad Operating Company, LLC (San Pedro) acquired the El Paso’s rights to the railway. At that time, the railway served one principal shipper, the Chemical Lime Company. San Pedro intended to restore a connection with the Mexico rail service at Naco, Arizona, but the plan never materialized. Thus, in 2005, San Pedro initiated proceedings to abandon all 76.2 miles of the railway by filing a petition with the STB under 49 U.S.C. § 10502 seeking exemption from the requirements of 49 U.S.C. § 10903. As explained by the STB, when such a “petition becomes effective, the railroad will be able to salvage track, ties, and other railroad appurtenances and dispose of the right-of-way.” STB Docket No. AB-1081X, D.I. 35-9, 1 (Nov. 9, 2005). Over an objection from the Chemical Lime Company, the STB granted San Pedro’s petition and instructed San Pedro to file a notice of consummation to signify that it had exercised its authority to fully abandon its railway line. Id. at 7; see also 49 C.F.R. § 1152.29(e)(2).

The Trust for Public Land (Trust), a charity supporting the conversion of abandoned rail lines to public recreational trails, asked the STB to issue a Notice of Interim Trail Use or Abandonment (NITU) pursuant to § 8(d) of the National Trails System Act Amendments of 1983 (Trails Act). See 16 U.S.C. § 1247(d). San Pedro indicated its willingness to enter into trail use negotiations with the Trust, and on July 25, 2006, the STB issued a NITU, suspending abandonment proceedings and authorizing a 180-day period for San Pedro and the Trust to negotiate a trail use agreement. STB Docket No. AB-1081X, D.I. 35-10, 2 (Jul. 25, 2006). The Trust requested a 30-day extension of the negotiating period of the NITU for a portion of the railway line, specifically, a segment running from Highway 92 to Curtiss Flats (the Northern Stretch). Thus for this segment, the negotiating period lasted 210 days. The STB indicated that San Pedro’s abandonment exemption would become effective subject to the NITU (and other standard condi[1018] tions, not relevant here). The STB further stated that if no trail use agreement was reached, San Pedro could fully abandon its railway line. Id. at 3. Shortly after the STB issued the NITU, San Pedro removed its rails and ties from the land.

The Trust and San Pedro did not reach a trail use agreement. On January 29, 2007, San Pedro filed a notice of consummation informing the STB that it had abandoned the portion of the railway line east of Naco, Arizona (the Southern Stretch). See 49 C.F.R. § 1152.29(e)(2).1 For the remainder of the line, San Pedro filed, and the STB granted, several requests to postpone the deadline to consummate abandonment. See, e.g., STB Docket No. 1081X (Jun. 8, 2007). The current deadline for San Pedro to consummate abandonment is July 26, 2011. STB Docket No. 1081X (May 14, 2010).

Although the Northern Stretch of the rail corridor no longer serves as a railway, no public trail has been established. According to the appellants, this corridor provides a convenient route to enter the United States from Mexico, and it is now used by illegal aliens and drug smugglers and patrolled by the U.S. Border Patrol. The appellants further state that they have tried to “fence and build barriers across the abandoned rail line but the Border Patrol and trespassers continue to cut the fence and remove the barriers.” Appellants’ Br. at 10.

The appellants brought suit against the United States in the Court of Federal Claims alleging a violation of the takings clause of the Fifth Amendment to the United States Constitution. The appellants alleged, among other things, that the NITU had forestalled or taken their state law reversionary property interests. J.A. 65. The appellants further alleged that pursuant to Caldwell, 391 F.3d 1226, and Barclay, 443 F.3d 1368, a taking of their property occurred when the STB issued the NITU on July 25, 2006. J.A. 66.

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Ladd v. United States, 630 F.3d 1015, 2010 U.S. App. LEXIS 25443, 2010 WL 5230890 (Fed. Cir. 2010).

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