On The Case

Missouri River landowners file potentially gigantic Fifth Amendment class action

(Reuters) - On Dec. 14, Judge Nancy Firestone of the U.S. Court of Federal Claims ruled decisively that the U.S. government violated the Fifth Amendment rights of three landowners whose properties in the Missouri River basin became vulnerable to floods after the U.S. Army Corps of Engineers revised its management of the river to comply with environmental laws. The ruling by Judge Firestone, who has been overseeing takings claims by about 400 property owners along the river since 2014, will total more than $10 million for the three bellwether plaintiffs.

But for the lawyers representing the Missouri River plaintiffs – Dan Boulware of Polsinelli and Benjamin Brown of Cohen Milstein Sellers & Toll – Judge Firestone’s decision was a challenge as well as a win. The plaintiffs’ lawyers told me Monday that they had heard from dozens of additional landowners after launching the Fifth Amendment mass action with about 400 plaintiffs in 2014, but had held off on filing new claims until Judge Firestone clarified the scope of the case. The judge’s Dec. 14 ruling effectively set a claims deadline of Dec. 31. So Boulware and Brown had to figure out how to protect the interests of other Missouri River property owners – not just the dozens who had already contacted them but hundreds of others who might have valuable claims based on Judge Firestone’s decision.

Their solution? An unusual – but not unprecedented – Fifth Amendment class action in the Court of Federal Claims. The Dec. 30 complaint lists more than 60 named plaintiffs who own allegedly flood-prone land along the river in Kansas, Nebraska, Iowa and Missouri. If the class is certified, Boulware said, hundreds of other class members will also have an opportunity to assert claims. (Property owners who have already brought individual suits in the mass action, known as the Ideker case, are excluded from the class.)

Boulware said Judge Firestone’s decisions in the Ideker case should have collateral estoppel effect in the class action – which means that class members who can show their land was flooded in years the judge has already determined to have been affected by the Army’s revised river management policy will not have to prove causation.

Those claims, according to Boulware, should be worth at least $2,000 per acre, based on the judge’s assessment of reports from plaintiffs’ experts in the mass action. Boulware declined to estimate the government’s potential exposure in the class action, which will depend on whether the class is certified and how many property owners end up filing claims. But the entire Missouri River basin (which includes 10 states, not just the four states specified in the new class action) includes hundreds of millions of acres.

The Justice Department, which represents the U.S. government in takings cases, did not respond to a request for comment.

Class members must affirmatively opt in to class actions brought in the Court of Federal Claims, said plaintiffs’ lawyer Brown. That’s in contrast to most class actions in federal court, in which class members are part of the case unless they specifically opt out.

There have been a few other Fifth Amendment takings class actions by property owners suing in the Court of Federal Claims. In 2014’s Haggart v. United States, for instance, Judge Charles Lettow approved (116 Fed.Cl. 131) a $140.5 million class action settlement between the U.S. government and property owners whose land was converted into a recreational trail in a Rails to Trails program. (Other Rails to Trails landowners also reached class action settlements in federal claims court.) The Haggart case, interestingly, explained that under the claims court’s rules for class actions, plaintiffs need only “share common questions of law or fact” to be certified as a class.

Boulware said DOJ has relentlessly defended the mass action so he expects nothing less in the class action, even with the change in presidential administrations.