I am so excited to announce that High School SCOTUS has a new contributor. Arhon Strauss is a student at Phillips Exeter Academy, Class of 2023. He does Mock Trial, competes in Moot Court, and edits for The Exonian (the school newspaper). He became interested in law through his experiences in Mock Trial and more directly, Moot Court. Below, Arhon offers his first contribution to the blog, a deep dive into the history behind and legal reasoning of Kelo v. The City of New London.
89 years. In 89 years, Wilhemina Dery never budged from the small house in Fort Trumbull, Connecticut where she was born. A mother of two, Wilhemina lived in that house from 1918 through a polio epidemic, a flu pandemic, two economic crashes, and two world wars. In her last years alive, Wilhelmina had a simple wish: she wanted to live out her final days in the only home she knew. This wish to keep her home resulted in an eight year-long court battle, sparking a nationwide debate about property rights, eminent domain, and the meaning of a public use.
The story of this battle begins in 1998. That year Pfizer built a plant right next to Fort Trumbull, a neighborhood located in New London, Connecticut and co-owned by a variety of citizens. Not long after, the New London Development Corporation (NLDC), a non-profit, took advantage of the neighborhood’s recent economic woes and proposed a redevelopment plan. The idea presented to the City of New London was to build new living and work spaces that would revitalize the community. However, the NLDC’s plan was based around Pfitzer’s requests with the intent to boost their new plant’s profits. Regardless of any potential public gain, the primary purpose of the redevelopment was to help Pfizer as evidenced by the NLDC’s close ties to them and the benefits Pfizer would reap from redevelopment.
Yet in a controversial use of eminent domain — defined as the power to take property for public use — the city transferred the ownership of Fort Trumbull from the citizens living on it to the NLDC. The city stated that the transfer served the public use of “economic growth.” The affected citizens disagreed. Susette Kelo, along with Wilhelmina Dery and five other families living on the land, sued the city arguing that their actions were outside the scope of a public use and could not qualify for eminent domain. Not only was the supposed economic benefit speculative, it was also unspecific and extremely beneficial to a single private party: Pfizer. Despite these conditions, the Supreme Court of the United States ruled 5-4, agreeing with the city in a case now known as Kelo v. The City of New London (2005). The court justified the decision with misinterpreted precedent that was based in racial and economic discrimination. The unconstitutionality of the Supreme Court’s decision in Kelo set a dangerous precedent for the power of eminent domain, prompting both local and federal legislatures to combat the ruling.
To understand the power of Kelo v. City of New London and the public response to it, it is important to look at the precedents Kelo relies on. The primary cases involving similar situations were Hawaii Housing Authority v. Midkiff (1984) and Berman v. Parker (1954). Berman was an eminent domain case brought by two store owners in the District of Columbia, Max Morris and Goldie Schneider. The city used the powers of eminent domain to target the block they lived on, composed mostly of Black and Jewish people and one of the few racially harmonious locations in the city, as a slum for redevelopment. The Supreme Court unanimously ruled in favor of the city holding that the redevelopment and the possible sale of the redeveloped land was a public use. The court went on to state, “Once the object is within the authority of Congress, the means by which it will be attained is also for Congress to determine. Here one of the means chosen is the use of private enterprise for redevelopment of the area.” Essentially, the Berman ruling eliminated the requirement for direct government use of the land in order to qualify as eminent domain, dramatically expanding its power.
Moreover, the court skirted the constitutional questions raised in Berman by following the New Deal mindset, developed during Franklin Delano Roosevelt’s presidency, of not criticizing the government’s socio-economic legislation. Notably, the New Deal, while revolutionary in its employment of public housing, led to discrimination against black families through restrictive covenants, prejudicial real estate practices and redlining, forcing many to live in substandard housing. This substandard housing was subsequently targeted by redevelopment acts. The cycle is clear: Black and/or poor individuals were forced into blighted buildings, which created slums that could then be taken for redevelopment using public use and eminent domain as a justification. It may be impossible to say whether supporting the cycle was the government’s true intention, but the ruling in Berman v. Parker undoubtedly sustained this discriminatory process as it set the precedent allowing the government to broadly classify almost anything, including redevelopment by a private enterprise, as a public use.
The Supreme Court hammered down on their definition of eminent domain in Hawaii Housing Authority v. Midkiff. The case involved redistributing land from large landowners in Hawaii to the lessees living on the land. The court in an unanimous decision held that the government acted lawfully because in their words, “The Hawaii Legislature enacted its Land Reform Act not to benefit a particular class of identifiable individuals, but to attack certain perceived evils of concentrated property ownership in Hawaii — a legitimate public purpose.” The Midkiff ruling firmly established that a government needed a definite intention to benefit the public. Kelo did not meet the bar set in Midkiff because not only did it transfer rights to the NLDC, a private non-profit corporation, it also primarily benefited Pfizer, a private for-profit corporation. Furthermore, in using Midkiff as defense for Kelo, the Court ignored the core conditions of the original case. In Midkiff the government transferred property rights of a few landlords to many lessees, which made sense in the context of a public purpose because the act helped people in the general populace acquire land. The act in Kelo did the opposite, transferring the property rights of many to a singular private party. So contrary to the court’s opinion, Midkiff implied that the government actions in Kelo were unlawful.
Despite these opposing indicators, the Supreme Court applied both Midkiff and Berman as well as the rational basis test to Kelo, concluding that the City of New London lawfully used eminent domain. The court deemed the government’s use of the NLDC was irrelevant because Berman asserted that the government has discretion to choose the means by which to achieve a public purpose. In this case, the government may rely on a non-profit corporation to achieve redevelopment and economic growth. In following the precedent of Berman, the Supreme Court ignored the racial and economic discrimination often inherent in urban renewal programs, avoided discussion on the destruction of historic buildings and ignored the resulting concentration of extreme poverty. More importantly, Justice Stevens, who wrote the Court’s opinion in Kelo, admitted that he and the Court interpreted precedent incorrectly. Berman still supports the ruling, but Stevens concedes that “more than a century” of precedent rebutting the ultrawide definition of public use outweighs that singular ruling. Although it was not unprecedented, it was exceedingly rare for a Supreme Court Justice, especially the one that wrote the majority opinion, to admit that their reasoning was flawed. Not only was Stevens’ admission a testament to the incorrectness of the decision, but it undermines the credibility of any argument reaffirming Kelo.
The court’s decision to use the rational basis test in the case was also invalid. A rational basis test determines whether a law is constitutional by evaluating if it is rationally related to achieving a legitimate government interest. Rational basis is the least demanding standard of review, and may only be applied to rights not enumerated in the Constitution. Since Kelo explicitly addresses the Fifth Amendment, a rational basis test was not in order. The Supreme Court mistakenly implemented it in their ruling.
Unsurprisingly, the dissenting Supreme Court Justices recognized that the Kelo ruling misinterpreted precedent, emphasizing that it could effectively destroy limits on eminent domain powers. Dissenting for the minority, Justice Sandra Day O’Connor stated,
“Today the Court abandons this long-held, basic limitation on government power. Under the banner of economic development, all private property is now vulnerable to being taken and transferred to another private owner, so long as it might be upgraded i.e., given to an owner who will use it in a way that the legislature deems more beneficial to the public in the process. To reason, as the Court does, that the incidental public benefits resulting from the subsequent ordinary use of private property render economic development takings for public use is to wash out any distinction between private and public use of property and thereby effectively to delete the words for public use from the Takings Clause of the Fifth Amendment. Accordingly I respectfully dissent.”
Significantly, O’Connor refers to the NLDC’s redevelopment of the property as “an ordinary use,” because redevelopment is the primary business for NLDC and in turn standard practice. Looking at the circumstances from this angle, the City of New London’s public use rationale becomes increasingly far-fetched as they employed no unique use of the property. Notably, O’Connor chooses not to mention the clear benefits to Pfizer, implying that the taking fails to meet the bar of “public use” before even considering NLDC’s ulterior motives. Thus, there were two layers to the unconstitutionality of the court’s opinion,:the broadness of their interpretation of a public use and the taking’s benefit to a private party. Both charges prove that the final decision in Kelo was erroneous.
Taking a different approach, Justice Clarence Thomas, wrote a separate dissent. Thomas’ reasoning relied on originalism — a theory of judicial interpretation that examines the founding father’s initial intent in writing the Constitution. He pointed out that the specific wording of the Constitution suggests that a government taking must involve a direct public use of the land. In other words, the government can not use private corporations to develop the land for them. Thomas’s opinions were radical, but reflective of the overwhelming weight of arguments contradicting the Court’s ruling in Kelo.
Additionally, in his concurrence, Justice Anthony Kennedy, a supporter of the ruling, contradicted the opinion he attempted to reaffirm:
A court applying rational-basis review under the Public Use Clause should strike down a taking that, by a clear showing, is intended to favor a particular private party, with only incidental or pretextual public benefits, just as a court applying rational-basis review under the Equal Protection Clause must strike down a government classification that is clearly intended to injure a particular class of private parties, with only incidental or pretextual public justifications.
Kennedy’s statement, by warning against poor uses of eminent domain, indicates that Kelo could result in unconstitutional takings. Further, the situation in Kelo disproportionately benefited Pfizer, which is the exact scenario that Kennedy declared unconstitutional. So Kennedy’s words beg the question: why did he concur with the ruling? Put simply, he thought the situation in Kelo was not extreme enough to be excluded from eminent domain, a bizarre conclusion given the similarities between it and the type of situation he describes as unconstitutional. Yet, the mere fact that Kennedy attempted to draw a line between Kelo and more extreme circumstances demonstrated the fragility of the court’s argument in favor of the city.
While the Supreme Court followed racist precedents and faulty logic to rule in favor of the City of New London, the court of public opinion arrived at a different verdict. Polls showed that over 80 percent of people at the time disapproved of the court’s ruling. The case was so unpopular that there was bipartisan opposition to it. Judge Stevens said it was the “most unpopular opinion that any member of the Court wrote during” his 34-year term. All of this outcry did not prompt the Court to revisit Kelo, but did pressure 45 states and Congress into passing a variety of preemptive and responsive laws to counter the Kelo ruling. Along that same line, 36 states tightened definitions of public use and 25 states regulated the type as well as amount of property that was allowed to be redeveloped.
For example, Utah preemptively enacted a statute restricting lawful uses of eminent domain for redevelopment purposes three months before the final decision. The statute created criteria requiring all redevelopment plans to receive approval by the State Board of Education. This minimized the damage of Kelo by simply not addressing the legal precedent and making the bar for redevelopment, the main concern, much higher. Utah’s approach was similar to other states’ legislation that came in anticipation and reaction to the ruling.
The federal legislature also reflected Utah’s actions with more flamboyant language. First, the House of Representatives adopted Resolution 340 in a 365 to 33 vote, urging state and local governments not to “construe Kelo as justification to abuse the power of eminent domain.” But this act was toothless as it had no binding power. Congress’s next act utilized their strongest weapon: the wallet. House Resolution 3058 restricted federal agency funding for eminent domain in cases involving the transfer of property between private parties. The resolution stated, “public use shall not be construed to include economic development that primarily benefits private entities.” While the wording of Congress’s acts were strong and symbolized the national backlash to Kelo, the essence of the acts still avoided the legal precedent of Kelo by attacking solely the ability to conduct a taking. Put simply, the newfound power of eminent domain remained untouched, albeit with restrictions on the government’s ability to use that power.
Indeed, because the federal government could not fully counter the decision, local and state governments fought the Kelo ruling to varying degrees. The dangers posed by this situation are best explained by Dana Berliner, the Litigation director at Institute for Justice and primary representative for the homeowners in Kelo,
Do we want the right to free speech, or the right to be free from unreasonable searches and seizures, to vary by state, with some states providing strong protection and others virtually none? Highly varied and uneven protections would certainly allow for an interesting comparison of different policy approaches. But having such variability in the treatment of significant rights would defeat the purpose of having a federal constitution.
Berliner struck at the core of Kelo’s threat: its potential to alter the mindset of the American court system. He insinuated that the ease with which Kelo brushed aside property rights could put constitutional rights as a whole in danger of the same treatment. Contrary to Berliner’s warning, the ruling was relatively benign; the ruling in Kelo did not immediately seize the land of Americans across the country. Kelo bore its fangs once it was released into the jungle of the American circuit system. Just as Berliner worried, private parties, usually corporations, exploited the inconsistent legislative responses in low level federal courts.
For instance, in one of the first cases after Kelo, Seafood Co. v. United States, the Fifth Circuit used Kelo to justify the taking of family business even though that application of eminent domain wholly benefited another private family. Later on, in Whittaker v. Cnty. of Lawrence, the Third Circuit used Kelo to uphold economic development as a public use in spite of the state legislature prohibiting it as a justification for eminent domain. This ruling had the potential to make many state restrictions useless. Further, the Second Circuit, in Goldstein v. Pataki, allowed the government to deploy the eminent domain power when transferring land to a private company for redevelopment. In doing so, the Second Circuit ignored the fact that the company quickly disregarded the proposed public purpose of their plan. These cases displayed the negative influence of Kelo on eminent domain by showcasing some of the worst ways its precedent can be wielded by corporations to acquire land and in turn profit.
More recently, Eychaner v. The City of Chicago proved the Supreme Court’s resistance to overruling past precedent. In the case, Chicago transferred Fred Eychaner’s property to a politically-connected private business for redevelopment in order to secure that company’s support for a new zoning law. The city reasoned that the property’s risk of becoming slum was enough to qualify the move as a public use. Beyond the notional justification, the city verifiably bribed a private corporation with the property of a citizen, an act which stretched the meaning of public use further even than Kelo. Realizing this, Eychaner sued Chicago with the assistance of the Cato Institute. He argued that Chicago’s taking of his land did not qualify as a public use and filed an amicus brief requesting that the Supreme Court overrule Kelo. The court denied both parts of his petition. Eychaner v. The City of Chicago not only spoke to the continued abuse of Kelo, an abuse Justice Kennedy warned against, but also exemplified the way that abuse has continued to amplify the power of eminent domain.
The unconstitutionality of the Supreme Court’s ruling in Kelo set a dangerous precedent for the power of eminent domain, prompting both local and federal legislatures to combat the ruling, often with varying degrees of effectiveness. The Supreme Court’s decision erred in both their application of cases like Berman v. Parker, a case rooted in racial and economic discrimination, and their misintepretation of precedents, like in Midkiff v. Hawaii Housing Authority and United States v. Carolene Products. As such, the ruling was neither morally or legally correct, exemplifying the Court’s predilection to rule in favor of corporations and for the ‘big guy’ as opposed to ‘little guy.’ But even with rampant exploitation of Kelo in increasingly outlandish scenarios, the Supreme Court has refused to overrule it. This persistence to uphold precedent raises a disconcerting question: How far will the government and the courts stretch public use before the Court decides it’s gone too far? Having examined the aforementioned statements, the answer seems to be that the government’s imagination is the limit.