President's weekly report — August 30, 2013

Environment & Taxes — A.B. 32 “cap and trade” hearing

A hearing was held on Wednesday in Morningstar Packing Co. v. California Air Resources Board, our challenge to California’s “cap and trade” auction of emissions credits for carbon dioxide.  We are arguing that the Board lacks authority to raise billions of dollars from these auctions and even if it had the authority, it is violating California’s constitutional limits on raising taxes without a two-thirds vote of the legislature.  Prior to the hearing, the court issued a tentative ruling which leaned towards finding the authority but which also asked that six specific questions, mostly regarding taxes and the Proposition 13 argument, be addressed at the argument.  The hearing lasted over 2 1/2 hours and all sides were given ample opportunity to give their best arguments.  A decision is expected within 90 days.  (And don’t miss our podcast on the case.)

Property Rights — Water Rights

We had this nice victory this week in a major water rights case out of Texas, Edwards Aquifer Authority v. Bragg.  As our blog has noted, the Texas Court of Appeals said that the landowners and water rights holders, the Braggs, do have a reasonable expectation that they can maintain their water right, and the government’s infringement of those rights via a permitting scheme is a compensable regulatory taking under the Penn Central test (which calls for a balancing of factors to determine whether there is a taking.)  We had filed this amicus brief making these points last year.

Property Rights — Another Beach Victory in North Carolina

We received this excellent decision from the federal Fourth Circuit Court of Appeals this week in Town of Nags Head v. Toloczko.  As our blog post explains, we are representing a group of North Carolina owners of beachfront homes who were denied the right to repair their homes after a storm.  After a lower court refused to hear the case (saying it belonged in state court) we were brought in on the appeal.  Fortunately, as it did in our recent Sansotta victory, the appellate court held that our clients have every right to be in federal court to vindicate their property rights.

Property Rights — Exactions

We are not resting after our victory in Koontz because government agencies are still working hard to find ways to impose unconstitutional exactions against property owners.  In a scathing opinion a federal trial court called out a remarkable regime of “constitutional mischief,” in Hillcrest Properties v. Pasco County.  There, the county required landowners seeking permits to give up easements for future transportation needs without any showing of actual need caused by the permitted activity.  In other words, there was a clear violation of the exactions doctrines we have fought so hard to win in cases like Nollan, Dolan, and most recently, Koontz.  We filled this amicus brief this week in the Eleventh Circuit arguing that the county’s scheme is unconstitutional under the weight of Supreme Court precedent.

Free Enterprise Project — Arbitration and Magic Words

We filed this amicus brief this week in Atalese v. United States Legal Services Group.   As explained in more detail in our blog,  a New Jersey woman employing a credit counseling firm signed an agreement in which she expressly and unambiguously agreed to take any disputes to arbitration.  However, when she had a dispute, she refused to take it to arbitration.  Her lawyers argued that because the contract did not contain the word “waiver” she had not, in fact, waived her right to a court trial rather than the arbitration she had agreed to.  Our brief before the New Jersey Supreme Court points out that it is well-established that unambiguous words take priority over the absence of magic words.