The Flood of Takings Cases after Hurricane Harvey

On August 27, as Hurricane Harvey blew through the Houston area, the U.S. Army Corps of Engineers found itself between the proverbial rock and hard place. Since the 1940s, it had operated a flood control project to control the risk of flood damage to downtown Houston and the Houston Ship Channel. It had accomplished this by carefully controlling the release of flood waters from the project's dams. Now, however, the Corps confronted Hurricane Harvey, a megastorm generating massive, unprecedented volumes of flood water. 

The Corps faced the choice of either limiting water releases from the project to protect downstream properties at the cost of flooding upstream properties, or increasing project releases to protect upstream properties at the cost of flooding downstream properties. Not surprisingly, the Corps' decision on August 27 and on the following days, to release up to 13,000 cubic feet per second from the project dams, which arguably contributed to the flooding of both downstream and upstream properties, left everyone unhappy. 

What is surprising is that property owners upstream and downstream from the project have now filed as least 61 – yes, 61! – separate lawsuits in the U.S. Court of Federal Claims (CFC) asserting a "taking" of their private property under the Takings Clause of the Fifth Amendment of the U.S. Constitution. All told, the complaints seek "just compensation" from the U.S. government to the tune of several billions of dollars. 

Generally speaking, the plaintiffs assert that the flooding of their properties would not have occurred in the absence of the Corps' decision, noting in many complaints that their flooded properties were outside the 100-year floodplain. Downstream plaintiffs focus on the fact that the project release gates were undergoing repair at the time Harvey struck, and the Corps realized the gates might give way completely if it attempted to hold back too much water. These plaintiffs claim that by reducing water releases to safeguard the project – as well as to protect certain other property owners from flooding – the Corps sacrificed their properties to serve its own goals and benefit the other property owners. On the other hand, upstream plaintiffs assert that, because the Corps limited the release of flood waters, they suffered flooding and consequent property damage. 

A quick review of these complaints reveals a number of interesting issues. The first point to emphasize, however, is that all of these cases would have been laughed out of court prior to the Supreme Court's 2012 decision in Arkansas Game & Fish Comm'n v. United States. Prior to that decision, the United States could and did successfully argue that it could not be held liable under the Takings Clause for temporary flood events. In Arkansas, the Court repudiated that bright line rule, determined that even temporary (possibly even one-time) flooding events could give rise to takings liability, and set forth a complex, multi-factor, fact-specific framework for analyzing such claims. Arkansas does not necessarily mean the Harvey plaintiffs will necessarily prevail, but it gives them a shot. 

Justice Ruth Bader Ginsburg, writing for the Court in Arkansas, contended, somewhat defensively, that the Court's new, more expansive takings standard "augurs no deluge of takings liability." The flood of takings claims filed in the aftermath of Harvey obviously will put Justice Ginsburg's reassuring words to the test. 

One major issue in these cases will be causation. Most of the complaints, filed by both upstream and downstream plaintiffs, allege that the flooding was the direct, natural, and probable consequence of the Corps' releases – that plaintiffs' properties would not have flooded otherwise. But at least with respect to the downstream properties, if the Corps had held back more water, would the project release gates have collapsed, causing even more downstream flooding? If so, there arguably was nothing the Corps could have done to avoid the flooding. Or, at a minimum, the Corps may have made the best decision it could in an emergency to reduce property damage. 

Apart from the issue of the structural integrity of the release gates, the record-setting rainfall during Harvey suggests that, at bottom, the Corps' Houston-area flood control project was simply inadequate to deal with Harvey. Viewed this way, the Harvey flooding cases are like the 2007 case of Nicholson v. United States, in which the U.S. Court of Federal Claims rejected the argument that the overtopping of the Corps levee protecting New Orleans during Hurricane Katrina was a taking. It was the hurricane, not the Corps, that caused the flooding, said the court, because the flooding was so great that the levee made no difference. In the same vein, as far back as 1939, the Supreme Court held in United States v. Sponenbarger that a government flood control program does not effect a taking of lands the government chooses not to, or cannot, protect. 

Another issue is how the plaintiffs' claims might fare under the Arkansas decision. The Supreme Court explained in Arkansas that relevant factors will include the severity of the intrusion on private property caused by this single, unprecedented event, the character of the properties at issue and the owners' "reasonable investment-backed expectations" relating to their lands, and the extent to which the flooding was the intended or the foreseeable result of authorized government action. Suffice it to say that it is difficult to predict how these factors will apply to different plaintiffs' undoubtedly widely varying factual circumstances. The fact that Houston was already one of the most flood-prone cities in the country will certainly not cut in plaintiffs' favor. 

Third, the Corps' choice of the rate at which to release water from the Houston project during Hurricane Harvey raises the issue of how the Takings Clause should apply when the government has nothing but bad options. In the famous 1928 case of Miller v. Schoene, the Supreme Court held that the government could not be held liable under the Takings Clause for ordering the destruction of ornamental cedar trees, which served as host to a fungus that threatened nearby apple orchards. If the government had not ordered the destruction of the cedars, the apple trees would have been destroyed by the fungus instead, the Court reasoned, and in this circumstance, the government could pick what it perceives to be the least harmful option without incurring takings liability. Does this venerable precedent control the Harvey flooding cases? 

Looking to the future, and anticipating more frequent and larger precipitation events due to climate change, the Harvey takings cases might be the prelude to a veritable torrent of future takings litigation, especially if some or even a few of the Harvey claimants succeed. Takings doctrine might become a kind of social insurance program for risk associated with climate change, at least for those climate change victims fortunate enough to be able to point to a deep-pocketed defendant like the United States. At the same time, successful takings litigation may actually impede initiative to take steps to avoid the worst effects of climate change, undermining our collective ability to build more resilient communities.