Caquelin v. United States

• Decision Date: 29 May 2020
• Docket Number: 2019-1385
• Citation: 959 F.3d 1360
• Parties: Norma E. CAQUELIN, Plaintiff-Appellee v. UNITED STATES, Defendant-Appellant
• Court: U.S. Court of Appeals — Federal Circuit

959 F.3d 1360

Norma E. CAQUELIN, Plaintiff-Appellee

v.UNITED STATES, Defendant-Appellant

2019-1385

United States Court of Appeals, Federal Circuit.

Decided: May 29, 2020

Thomas Scott Stewart, Stewart Wald & McCulley, LLC, Kansas City, MO, argued for plaintiff-appellee. Also represented by Elizabeth McCulley ; Steven Wald, St. Louis, MO.

Erika Kranz, Environment and Natural Resources Division, United States Department of Justice, Washington, DC, argued for defendant-appellant. Also represented by Jeffrey B. Clark, Eric Grant.

Andrea Carol Ferster, Rails-To-Trails Conservancy, Washington, DC, for amicus curiae Rails-To-Trails Conservancy.

Meghan Sue Largent, LewisRice LLC, St. Louis, MO, for amici curiae Iowa Farm Bureau Federation, Illinois Agricultural Association, Kansas Farm Bureau, Missouri Farm Bureau Federation. Also represented by Lindsay Brinton.

Mark F. Hearne, II, True North Law Group, LLC, St. Louis, MO, for amici curiae National Association for Reversionary Property Owners, Cato Institute, Southeastern Legal Foundation, Reason Foundation, Inversecondemnation.com, James W. Ely, Jr. Also represented by Stephen S. Davis.

Before Prost, Chief Judge, Linn and Taranto, Circuit Judges.

Taranto, Circuit Judge.

Norma Caquelin owns land that was subject to a railroad-held easement limited to railroad use. The railroad applied to the federal Surface Transportation Board for permission to abandon its rail line, noting that it had run no traffic over the line for two years. Shortly thereafter, the Board granted the permission to abandon, to take effect a month later, unless, as relevant here, the federal-law process for considering use of the easement land for a public recreational trail was duly invoked. That process was invoked, and two days before the abandonment permission was otherwise to take effect, the Board issued a Notice of Interim Trail Use or Abandonment (NITU). The NITU prevented effectuation of the abandonment-authority approval and thus blocked abandonment—and, as a result, blocked the ending of the railroad's easement, for which abandonment was a necessary condition—for 180 days, during which the railroad could negotiate to try to reach an agreement with two entities that expressed interest in a transfer of the easement for trail use. The NITU expired on the 180th day when no such agreement was reached. The railroad completed its abandonment three months later.

Ms. Caquelin sued the United States in the Court of Federal Claims, alleging that a taking in violation of the Fifth Amendment's Takings Clause occurred when the government, by issuing the NITU that blocked abandonment, prevented termination of the easement during the 180-day period of the NITU. The trial court granted Ms. Caquelin's motion for summary judgment of liability. Caquelin v. United States , 121 Fed. Cl. 658 (2015) ( Caquelin I ). The court relied on our decisions in Ladd v. United States , 630 F.3d 1015 (Fed. Cir. 2010) ( Ladd I ), Caldwell v. United States , 391 F.3d 1226 (Fed. Cir. 2004), and Barclay v. United States , 443 F.3d 1368 (Fed. Cir. 2006). The parties stipulated to compensation of $900. Deferring the issue of attorneys’ fees, the court entered judgment under Court of Federal Claims Rule 54(b).

The government appealed. It argued that this court should overrule at least Ladd I , and perhaps also Caldwell and Barclay . And it argued that a NITU, when not followed by a trail agreement, should not be treated as a categorical taking; instead, either it should be subject to a general regulatory-taking analysis under Penn Central Transportation Co. v. City of New York , 438 U.S. 104, 124, 98 S.Ct. 2646, 57 L.Ed.2d 631 (1978), and Tahoe-Sierra Preservation Council, Inc. v. Ta-hoe Regional Planning Agency , 535 U.S. 302, 321–24, 122 S.Ct. 1465, 152 L.Ed.2d 517 (2002), or it should be analyzed using the multi-factor approach adopted for government-created flooding in Arkansas Game & Fish Commission v. United States , 568 U.S. 23, 38–40, 133 S.Ct. 511, 184 L.Ed.2d 417 (2012).

Without ruling on the merits of the government's arguments, we remanded for the trial court to receive additional evidence, as needed, and to make findings under an Arkansas Game approach, so that consideration of the legal challenges could proceed on a fuller record. Caquelin v. United States , 697 F. App'x 1016, 1019–20 (Fed. Cir. 2017) ( Caquelin II ). On remand, the trial court again held that a taking had occurred. Caquelin v. United States , 140 Fed. Cl. 564 (2018) ( Caquelin III ).

The government appeals. We affirm. We reject the contention that Arkansas Game calls for displacing the categorical-taking analysis adopted in our precedents for a NITU that blocks termination of an easement, an analysis applicable even when that NITU expires without a trail-use agreement that would indefinitely extend the federal-law blocking of the easement's termination. We clarify, however, that a NITU does not effect a taking if, even in the absence of a NITU, the railroad would not have abandoned its line (a necessary prerequisite for termination of the easement under state law) during the period of the NITU: in such a case, the NITU takes nothing from the landowner that the landowner would have had in the absence of the NITU. We leave to future cases further questions about that issue. Here, the government has not sought a remand for findings on when the railroad would have abandoned the line in the absence of a NITU, and the evidence permits a finding that abandonment would have occurred during the NITU period if the NITU had not issued.

I

A

The Transportation Act of 1920, ch. 91, § 402, 41 Stat. 456, 476–78, requires a rail carrier that intends to abandon or discontinue a railroad line to file an application with the Surface Transportation Board. See 49 U.S.C. § 10903(a) ; 49 C.F.R. §§ 1152.20 – 1152.22. A rail carrier qualifies for an exemption from certain requirements if it certifies that no local traffic has moved over the line for at least two years and that any overhead traffic can be rerouted over other lines. 49 C.F.R. § 1152.50(b). The National Trails System Act Amendments of 1983, Pub. L. No. 98-11, § 208, 97 Stat. 42, 48 (Trails Act), provides for blocking of "abandonment," however, despite the absence of any rail use, present or in prospect, if a proper entity agrees with the railroad to take over the rail right-of-way for trail use. 16 U.S.C. § 1247(d). Such trail use is deemed "interim," id. , and the term "rail banking" is applied, 49 C.F.R. § 1152.29(a), because rail use might someday be restored.

When a rail carrier applies for permission to abandon, as relevant here, the Board's regulations provide that any prospective trail sponsor may file a comment indicating an interest "in acquiring or using a right-of-way of a rail line ... for interim trail use and rail banking." 49 C.F.R. § 1152.29(a). If the rail carrier agrees to negotiate an agreement with such a potential trail sponsor, the Board will issue to the rail carrier and potential trail sponsor a NITU providing for a 180-day negotiation period. Id. § 1152.29(d)(1) ; see also Preseault v. Interstate Commerce Commission , 494 U.S. 1, 7 n.5, 110 S.Ct. 914, 108 L.Ed.2d 1 (1990) ( Preseault I ). Consistent with the limitation of potential outcomes recognized in the full name—"a Notice of Interim Trail Use or Abandonment"—the NITU generally provides that the rail carrier may, during the NITU period, continue the process of physical abandonment, i.e. , may "discontinue service, cancel any applicable tariffs, and salvage track and materials." 49 C.F.R. § 1152.29(d)(1) ; see also Preseault I , 494 U.S. at 7 n.5, 110 S.Ct. 914. If the parties reach an agreement, and duly notify the Board, the right-of-way remains under Board jurisdiction indefinitely while used as a recreational trail, and state law may not treat that "interim use ... as an abandonment of the use of such rights-of-way for railroad purposes." 16 U.S.C. § 1247(d) ; see also Government Opening Br. 8 (notification to Board of trail-use agreement "prevents a railroad easement from being abandoned as it might otherwise under applicable law"). If the parties fail to reach an agreement, and the NITU expires, the rail carrier gains authority to abandon; that authority does not mandate abandonment, but if the rail carrier does not exercise the authority within a one-year period defined by regulation, it cannot abandon without filing a new request for abandonment authority. 49 C.F.R. § 1152.29(d)(1), (e)(2).

In Preseault I , the Supreme Court held that, to the extent that the application of the Trails Act results in a Fifth Amendment taking by preventing a property owner from regaining an unencumbered interest in the land subject to a right-of-way, the Tucker Act authorizes suit in the Court of Federal Claims. 494 U.S. at 11–17, 110 S.Ct. 914. We subsequently held that establishment of a trail under the Trails Act results in a Fifth Amendment taking when the original easement granted to the rail carrier under state property law is not sufficiently broad in scope to encompass recreational trail use. Preseault v. United States , 100 F.3d 1525 (Fed. Cir. 1996) (en banc) ( Preseault II ).

In Caldwell , we addressed a statute-of-limitations question, and we "h[e]ld that the Fifth Amendment taking, if any, under the Trails Act is accomplished when an NITU is issued and state law reversionary interests that would otherwise take effect pursuant to normal abandonment proceedings are forestalled." 391 F.3d at 1236 ; id. at 1233 ("The taking, if any, when a railroad right-of-way is converted to interim trail use under the Trails Act occurs when state law reversionary property interests that would otherwise vest in the adjacent landowners are blocked from so vesting."). We followed that rule in Barclay , 443 F.3d at 1373–74. Later, in Ladd I , we applied Caldwell and Barclay , along with the principle that "physical takings are compensable, even when temporary," ...