WASHINGTON, DC – Arent Fox LLP won a major victory earlier this month for Kansas landowners in Butler and Reno counties A federal judge ruled these landowners are entitled to “just compensation” under the Fifth Amendment of the U.S. Constitution. The federal Surface Transportation Board (STB) ordered an abandoned railroad easement to be converted into a public trail. Under Kansas law, these landowners had the right to exclusive use and possession of their land.

In a 34-page opinion, Judge Nancy B. Firestone of the US Court of Federal Claims granted Arent Fox’s motion for summary judgment filed on behalf of the landowners, writing “the court finds that recreational trail use is not a use contemplated by the original easements because it is not a use that advances the operation of trains. Indeed, a recreational trail is only viable when the operations of trains has ceased. As such, recreational trail use if outside the scope of a railroad purpose easement.”

A copy of the decision is available here.

Arent Fox partner Thor Hearne, a nationally known authority in constitutional and eminent domain litigation who represents the Kansas landowners and argued their case in the Federal Circuit, said, “We are very pleased with the court’s decision. Judge Firestone’s decision was exceptionally well-reasoned and persuasive and will serve as a powerful precedent in future Trails Act litigation.”

The case, Biery v. United States, involves of the National Trails System Act Amendments of 1983 (otherwise known as the “Trails Acts”) in which Congress authorized the STB to convert abandoned railroad easements into recreational trail.

The plaintiffs in the case (actually, three consolidated lawsuits involving separate tracts of land in Kansas) successfully argued that their property was “taken” by the government when the STB approved the conversion of the railroad lines into recreational trails, thereby entitling the landowners to compensation under the Constitution.

The two properties at issue were easements to use: (i) a 10.6 mile-long, 100-foot-wide strip of railroad corridor between Augusta, Kansas, and Andover, Kansas, initially acquired in 1879 by the St. Louis, Wichita & Western Railway Company, and; (ii) a 2.8 mile long, 100-foot-wide strip of railroad corridor in Reno County, Kansas, acquired through condemnation proceedings in the late 19th century by the Hutchinson, Oklahoma & Gulf Railway Company. In both instances, the easements to use the land were limited to railroad purposes.

The federal government, represented by the Justice Department, argued that it could convert these abandoned railroad easements into a public trail and not pay the landowners. The government claimed a public recreation trail was a “railroad purpose” under the Trails Act and, therefore, no compensation need be paid to heirs of the original landowners.

Judge Firestone rejected the Justice Department’s argument, writing, “The court concludes that use of the railroad purpose easements for recreational trail purposes is not related to train travel (nor does it ‘advance the purposes for which the easements were created, and imposes a different burden on the plaintiffs' estates beyond that reasonably contemplated at the time of conveyance or condemnation. Thus the court concludes that recreational trail use amounts to a use outside the scope of the easement granted.”

The court also dismissed the government’s claim that it did not owe the plaintiffs compensation under the Fifth Amendment because it was possible that the land might one day again be used for railroad purposes and that the government was preserving the land for that purpose under a practice known as “railbanking.”

Agreeing with the plaintiffs, Judge Firestone wrote, “[T]he court finds that future use as a railroad is indeed ‘highly improbable’ and thus railbanking is not, under Kansas law and the facts of these cases, a railroad purpose sufficient to preserve the subject easements and prevent the abandonment of a railroad easement.”

Jude Firestone’s decision is the latest major victory for property owners secured by Thor Hearne and the Arent Fox team in “Rails-to-Trails” Fifth Amendment litigation in recent months. In December, 2010, the US Court of Appeals for the Federal Circuit in Ladd, et al. v. United States ordered the federal government to pay Arizona ranchers for property it had taken from them. In May 2011, the Federal Circuit denied the government’s motion for an en banc rehearing of the Ladd case. Similarly, in October, 2010, the Federal Circuit denied the US Department of Justice’s motion to rehear the court’s unanimous decision issued May 3 Bright, et al., v. United States, a closely followed case involving landowners suing the federal government as a class in a takings dispute over the federal program to convert railroad lines into recreational trails.

In addition to Mr. Hearne, the Arent Fox team included associates Meghan Largent, and Lindsay Brinton.

###

About Arent Fox:
Arent Fox LLP (www.arentfox.com), with offices Washington, DC, New York, and Los Angeles, is a recognized leader in areas including government relations, intellectual property, real estate, telecommunications, health care, automotive, sports, white collar, international trade, bankruptcy, and complex litigation. With more than 350 lawyers nationwide, Arent Fox has extensive experience in corporate securities, financial restructuring, labor and employment, finance, tax, corporate compliance, and the global business market. The firm represents Fortune 500 companies, government agencies, trade associations, foreign governments and other entities.