SW Legal studies in Business

Public Taking for Private Purpose Violates Takings Clause
Description Trial court issued an injunction against a city in California that was going to use its powers of eminent domain to condemn a successful private store so that another private store could expand its operations into the space occupied by the other store. That is not a taking for public use, even if compensated, and so violates the Takings Clause.
Topic Constitutional Law
Key Words Takings; Eminent Domain; Condemnation; Public Use
C A S E   S U M M A R Y
Facts Lancaster, California, encouraged the development of a new shopping area, which became very popular. Among the stores in the new shopping area were Costco and 99 Cents Only Stores, both of which had long term leases. Costco told Lancaster that it needed more room to expand or it would move the store to the city of Palmdale. Costco wanted the area occupied by 99 Cents. Lancaster, wanting to keep Costco, tried to buy the lease from 99 Cents, but it refused. The city then used its power of eminent domain to condemn the property occupied by 99 Cents. 99 Cents sued the city, contending its attempt to condemn its property interests violated the "public use" clause of the Fifth Amendment because it would serve no purpose other than to appease a private party, Costco.
Decision 99 Cents' motion of summary judgment granted. Lancaster is permanently enjoined from initiating eminent domain proceedings against the property occupied by 99 Cents so long as the purpose of such proceedings is to permit Costco to enter into the property. "The Fifth Amendment to the Constitution proscribes the 'taking' of private property 'for public use without just compensation.' The 'public use' requirement is an explicit limit on the power of government to take private property for, as the Supreme Court has long recognized, a taking-even if justly compensated-must serve a legitimate public purpose. A taking for purely private use is unconstitutional no matter the amount of 'just compensation' that may be given." The action here was an unconstitutional taking for purely private purposes.
Citation 99 Cents Only Stores v. Lancaster Redevelopment Agency, 2001 WL 811056 (C.D., Calif., 2001)

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