In its regulatory takings jurisprudence, the Supreme Court has attempted to balance its conscious avoidance of “set formulas” with its belief that certain regulatory actions will categorically constitute a taking.1×1. See, e.g., Lucas v. S.C. Coastal Council, 505 U.S. 1003, 1015 (1992) (acknowledging that the Court has “generally eschewed” formulas for regulatory takings but has nonetheless carved out “two discrete categories . . . as compensable without case-specific inquiry”). Last Term, in Horne v. Department of Agriculture,2×2. 135 S. Ct. 2419 (2015). the Court revisited this debate, this time in the context of personal property. In the process of holding that the Takings Clause categorically applies to certain personal property cases, the Court reflexively applied its “per se” approach to a regulatory scheme governing the national raisin market. In so doing, the Court dismissed as irrelevant valuable precedent discouraging the use of categorical rules in takings cases involving personal property. While directed at a program Chief Justice Roberts understood to be a “historical quirk,”3×3. Transcript of Oral Argument at 34, Horne, 135 S. Ct. 2419 (No. 14-275). his opinion in Horne nevertheless threatens to radically expand the Court’s per se takings doctrine at the expense of the government’s ability to operate effectively.
The Supreme Court’s ruling in Horne marked the end of over a decade of litigation. The decision’s seeds were initially planted in 2002 when Marvin and Laura Horne, a couple who grew and sold raisins, refused to comply with the Marketing Order for raisins promulgated under the Agricultural Marketing Agreement Act of 19374×4. 7 U.S.C. §§ 601–674 (2012). (AMAA).5×5. See Horne v. U.S. Dep’t of Agric., No. 08-1549, 2009 WL 4895362, at *1–3 (E.D. Cal. Dec. 11, 2009). A “measure [designed] to prevent the demoralization of the industry by stabilizing the marketing of the raisin crop,”6×6. Parker v. Brown, 317 U.S. 341, 367 (1943). the Order required that all “handlers” of raisins — typically those who prepare and sell raisins7×7. See 7 C.F.R. § 989.15 (2015) (defining “handler” for purposes of the AMAA). — set aside a percentage of raisins during years of excess production.8×8. See id. § 989.66. In such years, control of this reserve was transferred to the Raisin Administrative Committee (RAC), which diverted the reserve raisins from the open market to noncompetitive markets.9×9. See id. § 989.67(b). The RAC is a government entity composed of forty-seven members representing different segments of the raisin industry. Id. § 989.26. Proceeds from these sales were primarily used to compensate handlers for their sorting services, but the growers did retain an equity interest in any remaining profits.10×10. Id. § 989.66(h). The Marketing Order notably demanded that the reserve raisins be sold in a manner that “maxim[izes] producer returns.” Id. § 989.67(d)(1).
The Hornes’ failure to set aside reserve raisins triggered a lengthy administrative proceeding that culminated in the imposition of a $695,226.92 fine for 83 regulatory violations.11×11. Horne v. U.S. Dep’t of Agric., No. CV-F-08-1549, 2009 WL 4895362, at *6 (E.D. Cal. Dec. 11, 2009). When the Hornes appealed the administrative decision in federal district court as a violation of the Takings Clause,12×12. The Takings Clause, U.S. Const. amend. V, provides that private property may not be taken for public use without just compensation. The clause is thus violated when there is both a “taking” and a lack of just compensation. See Williamson Cty. Reg’l Planning Comm’n v. Hamilton Bank, 473 U.S. 172, 194 (1985) (“The Fifth Amendment does not proscribe the taking of property; it proscribes taking without just compensation.”). the Eastern District of California found that, because the government did not physically invade the plaintiffs’ land or take physical possession of the raisins,13×13. The court based its determination that the government did not take physical possession of the raisins on its understanding that the growers transferred the reserve raisins to the handler (and, by extension, the government) as an admission fee for marketing the raisins. See Horne, 2009 WL 4895362, at *26. and because the plaintiffs retained an equity interest in the reserve raisins, “there [was] no physical taking.”14×14. Id. at *27. The district court also rejected the Hornes’ claims that they were not “handlers” within the meaning of the regulation. Id. at *10–17. On appeal, the Ninth Circuit ruled that the Hornes had brought their suit as producers, which meant that their claim could proceed only before the Court of Federal Claims.15×15. Horne v. U.S. Dep’t of Agric., 673 F.3d 1071, 1080 (9th Cir. 2011). The Ninth Circuit also upheld the district court’s determination that the Hornes were “handlers,” id. at 1078, and that the regulatory fines were constitutional, id. at 1080–81. The Supreme Court disagreed unanimously. Reasoning that the Hornes had brought their suit as handlers, the Court concluded that the lower courts had jurisdiction to hear the takings defense.16×16. Horne v. Dep’t of Agric., 133 S. Ct. 2053, 2063 (2013) (citing 7 U.S.C. § 608c(15)(A)–(B) (2012) (providing the district courts with jurisdiction in equity to review rulings made against handlers by the Secretary of Agriculture)). Accordingly, the Court remanded the case for a determination of whether the government’s actions violated the Fifth Amendment.17×17. Id. at 2064. The Court granted certiorari only on the jurisdictional issue and thus did not entertain the Hornes’ other arguments. See id. at 2060.
In an opinion by Judge Hawkins,18×18. Judge Hawkins was joined by Judges Reinhardt and Gould. the Ninth Circuit held that the raisin diversion program did not amount to an unconstitutional taking.19×19. Horne v. U.S. Dep’t of Agric., 750 F.3d 1128, 1132 (9th Cir. 2014). The court first clarified that, even though there had not been a physical taking of the Hornes’ property, the fine for not complying with the Marketing Order’s reserve requirement could violate the Fifth Amendment under the unconstitutional conditions doctrine.20×20. Id. at 1138. Turning its attention to the reserve requirement, the court established that the Hornes had not suffered from a paradigmatic physical taking and thus could prevail only if the reserve requirement worked a regulatory taking.21×21. Id. A regulatory taking is a restriction on the use of property that proves “so onerous that its effect is tantamount to a direct appropriation.” Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 538 (2005). The court distinguished this from “paradigmatic taking[s],” where the government directly “appropriates or occupies private property.” Horne, 750 F.3d at 1138. Yet because the Hornes had not presented a claim under the traditional Penn Central balancing test,22×22. This regulatory taking test weighs the “economic impact of the regulation,” the regulation’s interference with “investment-backed expectations,” and the “character of the government action.” See Penn Cent. Transp. Co. v. New York City, 438 U.S. 104, 124 (1978). the success of their suit hinged on whether the Marketing Order fit one of three narrow categories of per se takings.23×23. Horne, 750 F.3d at 1138–39. Judge Hawkins defined the three categories as “permanent physical invasions of real property,” “regulations depriving owners of all economically beneficial use of their real property,” and certain conditions on grants of land-use permits that require the forfeiture of a property right. Id. at 1139. Finding that the reserve requirement could be distinguished from all three, Judge Hawkins concluded that the program “d[id] not constitute a taking under the Fifth Amendment.”24×24. Id. at 1144.
The Supreme Court reversed. Writing for the majority, Chief Justice Roberts25×25. The Chief Justice was joined by Justices Scalia, Kennedy, Thomas, and Alito. Justices Ginsburg, Breyer, and Kagan joined the parts of the opinion unrelated to the calculation of just compensation. began by asserting that the Fifth Amendment may impose a “categorical duty” on the government to pay just compensation when it “physically takes possession of an interest in [personal] property.”26×26. Horne, 135 S. Ct. at 2425 (quoting Ark. Game & Fish Comm’n v. United States, 133 S. Ct. 511, 518 (2012)). The Chief Justice argued that, just as the direct appropriation of real property is a “per se taking that requires just compensation,” so too does the appropriation of personal property trigger the demands of the Fifth Amendment.27×27. Id. at 2426. The opinion then provided a brief overview of colonial understandings of takings, emphasizing that this history lent no support to a distinction between personal and real property.28×28. Id. at 2426–27. And while the Chief Justice conceded that the Court had distinguished between personal and real property in Lucas v. South Carolina Coastal Council,29×29. Id. at 2427. The Court in Lucas ruled that the owner of real property suffers a taking when he is “called upon to sacrifice all economically beneficial uses” of the land. Lucas v. S.C. Coastal Council, 505 U.S. 1003, 1019 (1992). he maintained that Lucas was concerned exclusively with regulatory takings and was thus irrelevant to “classic takings” featuring direct appropriations.30×30. Horne, 135 S. Ct. at 2425, 2427–28. The Court based its understanding on language from Tahoe-Sierra Presidential Council, Inc. v. Tahoe Regional Planning Agency, 535 U.S. 302 (2002), that stated it is “inappropriate to treat cases involving physical takings as controlling precedents for the evaluation of a claim that there has been a ‘regulatory taking,’ and vice versa.” Id. at 323.
The Chief Justice found that the reserve requirement was a “clear physical taking” under Loretto v. Teleprompter Manhattan CATV Corp.31×31. 458 U.S. 419 (1982); see Horne, 135 S. Ct. at 2428 (citing Loretto, 458 U.S. at 435). Loretto specifically held that a “permanent physical occupation of property is a taking.” 458 U.S. at 441. This conclusion flowed from the fact that, apart from a “speculative hope” in receiving returns from the RAC’s residual proceeds, raisin growers subject to the reserve requirement “lose the entire ‘bundle’ of property rights in the appropriated raisins.”32×32. Horne, 135 S. Ct. at 2428. And while the government could prohibit raisin sales through a regulatory limit without violating the Constitution, the Chief Justice underscored that “[t]he Constitution . . . is concerned with means as well as ends.”33×33. Id.
Neither the growers’ contingent property interest nor the fact that growers chose to engage in the regulated raisin market prevented the Court from finding the program unconstitutional.34×34. See id. at 2430 (citing Loretto, 458 U.S. at 439 n.17). With respect to the contingent interest, the Chief Justice, again referencing Loretto, asserted that whether owners retain value in their property is immaterial in takings cases involving physical appropriations.35×35. Id. at 2429. Thus, the Court distinguished its per se takings analysis from regulatory takings cases where it had maintained the constitutionality of restrictions in the absence of a complete deprivation of an owner’s property rights.36×36. See id. (differentiating Andrus v. Allard, 444 U.S. 51 (1979); and PruneYard Shopping Ctr. v. Robins, 447 U.S. 74 (1980)).
Finally, the Court held that, with respect to just compensation, the government had “already calculated th[at] amount . . . when it fined the Hornes the fair market value of the raisins.”37×37. Id. at 2433. In reaching this conclusion, the Court rejected the arguments of both the government and Justice Breyer alleging that the benefits of the regulatory program should be accounted for in the determination of just compensation.38×38. See id. at 2431–33. Reiterating that “just compensation . . . is to be measured by ‘the market value of the property at the time of the taking,’”39×39. Id. at 2432 (quoting United States v. 50 Acres of Land, 469 U.S. 24, 29 (1984)). the Court decisively settled a case it felt had “gone on long enough.”40×40. Id. at 2433. Justice Thomas wrote a one-paragraph concurrence clarifying that the Takings Clause demands that a taking be for public use, a standard he felt might not be met by the reserve requirement. See id. (Thomas, J., concurring). Justice Breyer, joined by Justices Ginsburg and Kagan, authored a partial dissent arguing that the Marketing Order might provide just compensation by enhancing the value of the non-reserve raisins. Id. at 2433–36 (Breyer, J., concurring in part and dissenting in part).
Justice Sotomayor dissented. In her view, the Hornes’ claim fell within the regulatory takings framework yet did not meet the demands of any of the per se categories of regulatory takings.41×41. See id. at 2442–43 (Sotomayor, J., dissenting) (disagreeing with the majority’s insistence that regulatory takings cases are “inapposite”). Justice Sotomayor stressed that, for an action to be a taking under Loretto, “each and every property right [must] be destroyed by governmental action.”42×42. Id. at 2437. Justice Sotomayor underlined the “strict[ness]” of the per se rule and “bold[ness]” of any claim made under it, id. at 2437–38, pointing to a number of cases where even a “significant restriction” in property rights did not amount to a taking under Loretto, id. at 2438 (quoting Andrus v. Allard, 444 U.S. 51, 65 (1979)). The Marketing Order, by contrast, preserved for growers the right to receive net proceeds from the sale of the reserve raisins.43×43. See id. at 2439. Justice Sotomayor characterized the right to receive income as the “most central interest” for an owner of a “fungible commodity for sale.” Id. Thus, because “the retention of even one property right . . . is sufficient to defeat a claim of a per se taking under Loretto,” Justice Sotomayor resolved that the Hornes’ categorical takings claim must fail.44×44. Id. at 2438. Justice Sotomayor found further support for this conclusion in a line of cases that “teach that the government may require certain property rights to be given up as a condition of entry into a regulated market without effecting a per se taking.” See id. at 2440–41 (citing Leonard & Leonard v. Earle, 279 U.S. 392 (1929); Ruckelshaus v. Monsanto Co., 467 U.S. 986 (1984); Yee v. City of Escondido, 503 U.S. 519 (1992)).
Justice Sotomayor spent the latter part of her dissent identifying two “fundamental errors” undergirding the majority’s opinion.45×45. Id. at 2441. First, Justice Sotomayor took issue with the majority’s idea that a per se taking had occurred, a “breezy assertion”46×46. Id. that she maintained ignored the Hornes’ retained right to certain reserve raisin proceeds.47×47. Id. at 2441–42. Because the majority based its holding on the fact that the retained right was “not substantial or certain enough,” Justice Sotomayor argued that the Court had misapplied the Loretto test and undermined its future utility.48×48. Id. at 2442. Specifically, Justice Sotomayor questioned how the once-narrow framework demanding “total destruction” could be administered when merely damaged property rights (“perhaps a 95 percent destruction[?] . . . . Perhaps 90? Perhaps 60[?]”) could now work a per se taking. Id. Such confusion would be “especially pernicious in the area of property rights,” where property owners and the government rely on predictability. Id. Finally, Justice Sotomayor criticized the majority’s belief that the physicality of the taking effected by the Marketing Order meant that it must be evaluated as a per se taking: this reasoning in her view was unsupported by any principle and could not be squared with the physical taking of data Ruckelshaus v. Monsanto Co.49×49. 467 U.S. 986. endorsed as constitutional.50×50. Horne, 135 S. Ct. at 2443 (Sotomayor, J., dissenting). The combined effect of these two errors “unsettle[d] an important area of [the Court’s] jurisprudence” in an “unwarranted” and “baffling” twisting of the takings doctrine.51×51. Id.
In Horne, the Court faced the novel and nontrivial task of outlining how its takings doctrine should apply to personal property. In so doing, the majority opinion relied heavily on Loretto, first using it to distinguish per se takings from regulatory takings and then asserting that Loretto’s holding — that a “permanent physical occupation” will “invariably” amount to a per se taking — applies to personal property. Yet in drawing this sharp line, the Court neglected to note that Loretto was in fact a regulatory takings case, and that regulatory takings cases can feature a per se approach. These omissions empowered the Court to establish a set formula for “per se personal property takings,” making certain types of regulatory action involving personal property unconstitutional by default. This approach ignores the Court’s earlier guidance about personal property, overlooks the real property orientation of previous per se takings cases featuring regulatory schemes, and jettisons general considerations relevant to regulatory takings, thereby inviting a host of adverse practical consequences.
The Chief Justice’s reasoning in Horne is buttressed by his conviction that the Marketing Order, in demanding the “direct appropriation” of property, amounts to a “classic taking.”52×52. Id. at 2425–28 (majority opinion). From there, his opinion proceeds to equate “classic” takings involving direct, physical appropriations with per se takings, which it contrasts with regulatory takings.53×53. See id. at 2429 (criticizing the government and dissent for “confus[ing] our inquiry concerning per se takings with our analysis for regulatory takings”). Thus, the Court ultimately distinguishes Loretto and Horne — as per se takings cases — from Lucas, a regulatory takings case.54×54. Id. at 2427 (“Whatever Lucas had to say about reasonable expectations with regard to regulations, people still do not expect their property, real or personal, to be actually occupied or taken away.”). This line-drawing exercise is no accident: the Court needed to distinguish Loretto specifically and per se takings cases generally from regulatory takings cases as a means of avoiding Lucas’s instruction that “in the case of personal property . . . [an owner] ought to be aware of the possibility that new regulation might even render his property economically worthless” without triggering the Takings Clause.55×55. Lucas v. S.C. Coastal Council, 505 U.S. 1003, 1027–28 (1992).
Nevertheless, the dichotomy the Court drew is untenable. First, the government action in Loretto is best understood not as a “classic” taking, but as a regulatory taking. While that case did involve a “permanent physical occupation,”56×56. Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419, 426 (1982). Notably, while the Horne Court used the words “direct appropriation” to describe the action in Loretto, see, e.g., Horne, 135 S. Ct. at 2427, those words were never used by the Loretto Court. the Court situated its reasoning and holding in the context of regulatory takings.57×57. See, e.g., Loretto, 458 U.S. at 441 (comparing the effect of the government’s action to “other categor[ies] of property regulation”). Given the fact that the lawsuit in Loretto was triggered by a regulation relating to cable television,58×58. Id. at 422–25. it is unsurprising that a number of scholars59×59. See, e.g., Frank Michelman, Takings, 1987, 88 Colum. L. Rev. 1600, 1610 (1988) (recognizing Loretto as a “category of a regulatory taking per se”). — as well as the Court itself60×60. See, e.g., Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 539 (2005) (situating Loretto in the Court’s “regulatory takings jurisprudence”). — have recognized Loretto as a regulatory takings case. By contrast, “classic” takings have historically involved direct invocations of the state’s power of eminent domain rather than regulations.61×61. See Stop the Beach Renourishment, Inc. v. Fla. Dep’t of Envtl. Prot., 130 S. Ct. 2592, 2601 (2010) (“[T]he classic taking is a transfer of property to the State or to another private party by eminent domain . . . .”); see also United States v. Sec. Indus. Bank, 459 U.S. 70, 78 (1982) (distinguishing Loretto and other regulatory takings cases from those involving “outright acquisitions”).
Second, the Court’s logic is grounded in the mistaken belief that per se takings and regulatory takings are mutually exclusive categories.62×62. The Court suggested as much when it painted the history of takings jurisprudence as divided between Penn Central and per se cases. See Horne, 135 S. Ct. at 2427. That said, even if Horne might be read as recognizing but largely ignoring per se regulatory takings cases, the opinion fails to articulate why reasoning from those cases is wholly irrelevant in other takings cases involving a categorical approach. Lucas, however, was both a regulatory takings case and a per se takings case: the Court there specified that when a “regulation denies all economically beneficial or productive use of land,” courts should “categorical[ly]” require compensation.63×63. Lucas v. S.C. Coastal Council, 505 U.S. 1003, 1015 (1992). Subsequent cases have reflexively acknowledged Lucas as a per se regulatory takings case. See, e.g., Lingle, 544 U.S. at 538. Whether or not one understands Loretto and Horne as regulatory cases, the fact that Lucas also featured a categorical approach suggests that the Court in Horne should not have so readily dismissed Lucas’s reasoning as irrelevant.64×64. Cf. Lucas, 505 U.S. at 1017 (suggesting that Lucas and Loretto are “equivalent” from the landowner’s point of view). Specifically, just as Lucas maintained that its per se approach should not apply to personal property, so too are there reasons that alleged takings of personal property should be considered contextually, particularly when the putative taking is directly tied to a regulatory scheme.65×65. This comment refers to a category slightly broader than that of “regulatory takings”: whether or not one considers Loretto or Horne to be regulatory takings — that is, cases involving use restrictions as opposed to a direct appropriation — the takings in both cases were directly tied to a regulatory scheme. By contrast, cases such as Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579 (1952); or Kelo v. City of New London, 545 U.S. 469 (2005), feature the government’s exercise of eminent domain outside the context of a larger regulatory scheme. Cf. Horne, 135 S. Ct. at 2443 (Sotomayor, J., dissenting) (suggesting Horne renders “regulatory takings jurisprudence irrelevant in some undefined set of cases involving government regulation of property rights”).
As a starting point, the per se regulatory cases notably cabin their holdings to real property. As previously mentioned, Lucas explicitly limits its application to actions suffered by “owner[s] of real property,”66×66. Lucas, 505 U.S. at 1019. and specifies that a separate framework should apply in cases of personal property.67×67. Id. at 1027–28. These same limitations also exist in Loretto. For instance, the Loretto Court noted that its holding will “present relatively few problems of proof” because “[t]he placement of a fixed structure on land or real property is an obvious fact that will rarely be subject to dispute.”68×68. Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419, 437 (1982) (emphasis added). Looking to the holding itself — that a regulation imposing a permanent physical occupation or invasion is a per se taking — this limit becomes even clearer. “Occupation” is defined as “the action of living in or using a building or other place,”69×69. Oxford Dictionary of English 1227 (3d ed. 2010) (emphasis added). “Occupy” is similarly defined with references to either a “place” or “space,” not a “thing.” See id. while “invade” is similarly tied to real property;70×70. “Invade” is defined as entering a “place, situation, or sphere of activity” in large numbers. See id. at 918. no government or military force has ever “occupied” or “invaded” a raisin. Especially given the Court’s insistence that these holdings should be interpreted “narrowly,”71×71. See, e.g., Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 538 (2005) (describing Lucas and Loretto as “two relatively narrow categories” of regulatory takings); see also Loretto, 458 U.S. at 441 (“Our holding today is very narrow.”). the per se regulatory cases imply that the Court should hesitate before extending its categorical approach to personal property.72×72. This analysis admittedly does not fully respond to the Chief Justice’s argument that the Constitution is concerned with “means as well as ends.” See Horne, 135 S. Ct. at 2428. However, such an approach to the doctrine ultimately elevates formalism over fairness and, for reasons discussed below, triggers a number of undesirable practical consequences.
These limits are unsurprising when one considers how analyzing a real property regulatory taking claim fundamentally differs from analyzing a personal property regulatory taking claim.73×73. The Penn Central balancing test does not apply to all takings cases featuring regulations; Loretto and Lucas prove as much. Nevertheless, because such per se cases are simply instances when a regulation goes “too far” in the Penn Central analysis, Palazzolo v. Rhode Island, 533 U.S. 606, 617 (2001) (quoting Penn. Coal Co. v. Mahon, 260 U.S. 393, 415 (1922)), Penn Central remains relevant to all regulatory cases. The first factor courts consider under the Penn Central balancing test is the economic impact of the regulation: Loretto and Lucas both mark situations where space is “empt[ied] . . . of any value”74×74. Loretto, 458 U.S. at 436. or deprived of “all economically beneficial uses.”75×75. Lucas v. S.C. Coastal Council, 505 U.S. 1003, 1019 (1992). Regulations of personal property, by contrast, operate on a wholly different scale. While physically appropriating 50% of a raisin crop might reduce the value of an owner’s personal property, it would hardly amount to the same quality of deprivation as a taking of real property.76×76. Cf. Keystone Bituminous Coal Ass’n v. DeBenedictis, 480 U.S. 470, 498 (1987) (rejecting plaintiffs’ attempt to dissociate their coal reserves as a separate property interest from the land in which the coal is located). Indeed, appropriating a percentage of a raisin crop — unlike appropriating a raisin farm — leaves an owner free to profit off the land the following season.77×77. Of course, not all pieces of personal property can be so easily replaced, and some personal property might mean more to an individual than a parcel of land. See Margaret Jane Radin, Property and Personhood, 34 Stan. L. Rev. 957, 986–88 (1982) (discussing the difference between personal and fungible property). It is nevertheless unlikely that the government would choose to appropriate sentimentally valued personal property via regulation. Yet by applying the per se approach to personal property, the Court rejects these distinctions and contends that assuming control of a fungible commodity is analogous, from a takings perspective, to appropriating the land on which that commodity is grown.78×78. Moreover, in Horne, the growers actually retained the right to receive money from the reserve raisins. 135 S. Ct. at 2424. This consideration is also lost when the Court transplants its per se categories to the personal property context.
Even in cases involving regulations that might deprive personal property of all economic value, the Penn Central test would still counsel against embracing a per se approach. The second relevant consideration, the investment-backed expectations of the owner, operates in a unique way in personal property cases. As a starting point, the Court has conclusively affirmed that “the State’s traditionally high degree of control over commercial dealings” means that, unlike in real property cases, a personal property owner “ought to be aware of the possibility that new regulation might . . . render his property economically worthless.”79×79. Lucas, 505 U.S. at 1027–28. Though not invoking this principle explicitly, the Court has repeatedly found that regulations that effectively render personal property economically worthless are not takings. See, e.g., Andrus v. Allard, 444 U.S. 51 (1979). This point is supplemented by the fact that personal property, unlike land, can be lost, abandoned, or destroyed, a reality that clearly affects owners’ expectations.80×80. Indeed, in many contexts, property laws govern personal property and real property in completely distinct ways. See generally Glen O. Robinson, Personal Property Servitudes, 71 U. Chi. L. Rev. 1449 (2004) (noting the common law’s “ambivalence” about servitudes on personal property); Lior Jacob Strahilevitz, The Right to Abandon, 158 U. Pa. L. Rev. 355 (2010) (discussing the common law’s prohibition of the abandonment of real property). And even between different types of personal property, investment-backed expectations vary wildly. For instance, the expectations of a farmer growing crops for sale in a regulated market diverge radically from those of a weekend gardener growing fruit to include in a family meal.81×81. The personal property at issue in those examples, in turn, differs from nonfungible personal property, such as a customized car or yacht, whose owner would have even less reason to expect to forfeit their property to government regulation. Horne’s disregard for these differences thus strays from common sense and precedent.82×82. See, e.g., Yee v. City of Escondido, 503 U.S. 519, 527 (1992) (rejecting petitioners’ rent control–based takings claim on the basis that they had “voluntarily rented their land to mobile home owners”); Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1007 (1984) (dismissing a takings claim because petitioners were “willing to bear [the regulatory] burden in exchange for the ability to market pesticides”). The Chief Justice briefly addressed Monsanto by noting that “[r]aisins are not dangerous pesticides; they are a healthy snack.” Horne, 135 S. Ct. at 2431.
All of this comes at the expense of the government’s ability to regulate personal property. The Court has repeatedly stressed the “substantial burden” a party faces when challenging a government regulation as an unconstitutional taking,83×83. E. Enters. v. Apfel, 524 U.S. 498, 523 (1998). and Justices have protested per se categories in the real property context as improperly eliminating that burden.84×84. See, e.g., Dolan v. City of Tigard, 512 U.S. 374, 411 (1994) (Stevens, J., dissenting) (“The burden of demonstrating that [regulatory] conditions have unreasonably impaired the economic value of the [property] belongs squarely on the shoulders of the party challenging the state action’s constitutionality.”). By applying a categorical rule to a regulation of personal property, the Horne Court not only eliminates this burden but deprives the government of the opportunity to defend its myriad regulations of personal property that might fall into this new category. This, in turn, seems to leave the government unable to argue on behalf of mandatory consumer product recalls, seizures of unsafe drugs, or an agency’s demands for records.85×85. Alternatively, the Court will be forced to distinguish later cases from Horne, carving out numerous exceptions that undermine the purpose of having a per se approach. The holding in Horne thus threatens to stymie certain key functions of the government, leaving it unable to “go on” effectively without paying sweeping compensation.86×86. See Penn. Coal Co. v. Mahon, 260 U.S. 393, 413 (1922).
None of this implies that the government should not be held accountable under the Fifth Amendment for takings of personal property. However, the appropriate means of making such an assessment is through a context-specific inquiry.87×87. The current ad hoc approach derived from Penn Central is far from perfect. See Gary Lawson et al., “Oh Lord, Please Don’t Let Me Be Misunderstood!”: Rediscovering the Mathews v. Eldridge and Penn Central Frameworks, 81 Notre Dame L. Rev. 1, 34–35 (2005) (“It does not do justice to academic criticism of Penn Central to describe such criticism as a cottage industry.”). Yet any framework that allows the government to defend its regulations is preferable to an approach that forecloses that avenue entirely. Especially in the realm of personal property regulations, “[t]he temptation to adopt what amount to per se rules in either direction must be resisted”88×88. Palazzolo v. Rhode Island, 533 U.S. 606, 636 (2001) (O’Connor, J., concurring). ; to do otherwise risks ignoring the various ways personal property differs from real property. Future courts should thus interpret Horne narrowly and avoid categorical rules in takings cases involving the regulation of personal property.