LOGISTICS: CLASS #32

1. LOGISTICS: CLASS #32 • Group Written Assignment #1: Coded Feedback on Question 1 for All Three Sub-Assignments on Course Page. Can look at more than your own work. • Group Written Assignment #3: Recurring Qs about Titles and Subject Headings: • (1)(f) Do not repeat the subjects of the arguments I have given you; simply make the arguments. MEANS:Don’t include phrases from the instructions like:“Choose two factual differences between the situations addressed in the escaping animals cases and the recovery of sunken treasure in international waters.” • For Sub-Assignments 3A & 3C: No need for any titles. Just state your arguments . • For Sub-Assignment 3B: Instructions say to begin arguments (1)  (4) by listing the particular factor you are discussing in that argument. That is the only title you need for these arguments.

2. LOGISTICS: CLASS #32 • We’re behind where we need to be. • Today + Wed.: I’ll mostly lecture through Sax, Mahon, Epstein, Miller. • Fri: If we’re back on track, more normal class • Last Set of Materials Posted Mid-Week

3. MUSIC: Alberta HunterComplete Recorded Works Vol. 2: 1923-24

4. Hadacheck v. Sebastian (1915)ContinuedDQ 3.09

5. Hadacheck v. Sebastian: Holding/RulesDQ3.09 What rules or principles can you derive from Hadacheck to use in future cases? • Start with very broad holding: Any exercise of police power is Constitutional if not arbitrary. • Narrower Versions?

6. Hadacheck v. Sebastian: Holding/RulesDQ3.09 VERY BROAD: Exercise of police power Constitutional if not arbitrary. NARROWER EXAMPLES: • Exercise of police power Constitutional if not arbitrary and related to human health & safety. • Exercise of police power Constitutional if not arbitrary and related to substantial concerns re human health & safety. • Exercise of police power Constitutional if not arbitrary and prohibiting public nuisance/ harmful use of land.

7. Hadacheck v. Sebastian: Holding/RulesDQ3.09 Other possible rules or principles: • Prohibiting existing use not automatically unconstitutional • Large decrease in property value not automatically unconstitutional Note that even Conservative commentators generally OK with these where purpose is to prevent substantial health/safety risks.

8. Hadacheck v. Sebastian: Holding/RulesDQ3.09 Other possible rules or principles: • Prohibiting existing use not automatically unconstitutional • Large decrease in property value not automatically unconstitutional • Maybe: Unconstitutional if all value removed (following Kelso) • Private interests must yield to progress & good of community (See third full paragraph p.109)

9. Hadacheck v. Sebastian: Holding/RulesDQ3.09 Apply rules/principles from Hadacheck to “Airspace Solution”

10. FINAL EXAM QUESTION 3Mapping Chart

11. Hadacheck v. Sebastian: Holding/RulesDQ3.09 Apply rules/principles from Hadacheck to “Airspace Solution” • Exercise of police power Constitutional if not arbitrary. • Exercise of police power Constitutional if not arbitrary and related to human health & safety • Exercise of police power Constitutional if not arbitrary and prohibiting nuisance/ harmful use of land • (Maybe): Unconstitutional if all value removed

12. Hadacheck v. Sebastian: Holding/RulesDQ3.09 Apply Hadacheck to “Airspace Solution”? • Airspace Solution OK under broader readings of reach of police power. • If Kelso rule applies, raises “Denominator Question”: Do We Look At: • All of Hammonds’s Property (Tiny % Lost) • Only at Underground Reservoirs (100% Lost) QUESTIONS ON HADACHECK?

13. Takings Theorist #1:Joseph Sax & DQ3.10-3.11

14. Takings Theorists: Joseph Sax Sax’s First Formulation • “Government-as-Enterpriser” • Classic uses of Eminent Domain (Road, School etc.) • Taking land for govt purpose, so should pay for • “Government-as-Arbiter.” • Govt resolving dispute between conflicting land uses • Not just conflicting parties • “Reese’s Peanut Butter Cup” Problems • When resolving dispute, no need to pay loser of dispute

15. Takings Theorists: Joseph SaxDQ3.10 “Govt-as-Enterpriser” v. “Govt-as-Arbiter” • Apply to Hadacheck: Pretty Clearly Arbiter Case (even though city may benefit some) • Circumstance Where It’s Hard to Tell? • E.g., Looks Like Arbiter but One Side of Dispute is Govt Owned (School, Military Base, Hospital)

16. Takings Theorists: Joseph SaxDQ3.10 “Govt-as-Enterpriser” v. “Govt-as-Arbiter” • Apply to Airspace Solution to Hammonds Problem • Could View as Arbitration between Gas Cos. & Other Surface Owners • Could View as Taking Property from Other Surface Owners for Gas Cos to Use for Large Public Benefit • Could generalize: Sax unclear if arbitrating between two private parties, but result is to give one party property rights of the other to further strong public interest.

17. Takings Theorists: Joseph SaxDQ3.10 “Govt-as-Enterpriser” v. “Govt-as-Arbiter” Three Situations that are Difficult to Categorize • Looks like arbitrating, but one side of dispute is gov’t owned(School, Military Base, Hospital) • Looks like arbitrating, butresult is to transferproperty rights of one party to the other to further strong public interest (not simply saying owner can’t do X) (Airspace Solution) • Limit on uses of private property to protect wildlife (choosing between animals and landowners not exactly the same as choosing between two sets of owners)

18. Takings Theorists: Joseph SaxDQ3.11 Sax’s Second Formulation • State Can Regulate Without Compensating to Prevent “Spillover Effects” (= Negative Externalities) • What “spillover effects” or externalities is the state trying to prevent … • in Hadacheck?

19. Takings Theorists: Joseph SaxDQ3.11 Sax’s Second Formulation • State Can Regulate Without Compensating to Prevent “Spillover Effects” (= Negative Externalities) • What “spillover effects” or externalities is the state trying to prevent … • in Hadacheck?Easy; harm to health & property value from brick pollution • in “the Airspace Solution” to Hammonds Problem?

20. Takings Theorists: Joseph SaxDQ3.11 Sax’s Second Formulation • What “spillover effects” or externalities is the state trying to prevent in “the Airspace Solution” to Hammonds Problem? • Surface Os not currently using, so no spillovers from activity. • BUT refusal to allow gas cos. to use creates large costs to society (safety, higher gas prices, etc.). HARD Q: should we treat these as “spillover effects” for Sax purposes?

21. Takings Theorists: Joseph Sax Sax’s First Formulation • “Government-as-Enterpriser” • Classic uses of Eminent Domain (Road, School etc.) • Taking land for govt purpose, so should pay for • “Government-as-Arbiter.” • Govt resolving dispute between conflicting land uses • When resolving dispute, no need to pay loser of dispute Sax’s Second Formulation • State Can Regulate Without Compensating to Prevent “Spillover Effects” (= Negative Externalities) QUESTIONS ON SAX?

22. Unit Three : IntroductionRelevant Considerations in Takings Cases Survey of Instincts About What Facts Matter • Ban on Intended Use (90%) • % Reduction in Value (88%) • Purpose of Regulation (63%) = Hadacheck (Police Powers); Sax (Enterpriser v. Arbiter; Stopping Spillovers) • $$$ Amount Reduction (59%) • $$$ Amount Left (56%)= Kelso (left open by Hadacheck) • Return on Investment (39%)

23. Pennsylvania Coal Co. v. MahonWe’ll Start with BriefIntroduction to 1922 & toJustices Holmes & Brandeis

24. 1922

25. Bea Arthur Helen Gurley Brown Sid Caesar Doris Day Judy Garland Redd Foxx Boutros-Boutros Ghali Jack Kerouac Jack Klugman Surrender Dorothy! 1922: BIRTHS

26. Christopher Lee Charles Mingus Leslie Nielsen Yitchak Rabin Jean-Pierre Rampal Carl Reiner Charles M. Schulz Kurt Vonnegut Betty White Betty & Sarumanthe White 1922: BIRTHS

27. 1st US Navy Aircraft Carrier Better Homes & Gardens British Broadcasting Co. Campbell’s Soup Dr. Doolittle Eskimo Pie Etiquette by Emily Post Hollywood Bowl Insulin Treatment of Diabetes King Tut’s Tomb Lincoln Memorial Dedicated 1st Microfilm Device National Football League Reader's Digest Rin Tin Tin Ulysses, by James Joyce Vitamin D The Waste Land by T.S. Eliot Water Skiing Yankee Stadium Construction Begins (Opens 1923) 1922: INTRODUCTIONS & DISCOVERIES

28. 1922: U.S. EVENTS • Last horse-drawn fire equipment used in Brooklyn • Henry Ford makes more than $264,000 per day; AP says he’s a billionaire • Growth of Radio: Many New Radio Stations + Many Firsts: • 1st Radio in White House & 1st Presidential Broadcast • 1st Paid Commercial • 1st Coast-to-Coast Broadcast of a Football Game • 1st Play-by-Play of World Series (Giants over Yankees 4-0 + 1 tie) • MahJonggintroduced in US; becomes a craze; by 1923, tile sets outselling even radios

29. Carolina in the Morning Chicago Do It Again I’ll Build a Stairway to Paradise My Buddy Taint Nobody’s Business if I Do Toot, Toot, Tootsie Way Down Yonder in New Orleans Louis Armstrong Goes to Chicago 1922 Bonus Slide:New in American Popular Music

30. 1922 Bonus Slide: Federal Baseball Club v. National League • U.S. Supreme Court holds Major League Baseball exempt from Federal Antitrust Laws (Still True) • Justice Holmes’s Majority Opinion says the business of giving “exhibitions of base ball” is not interstate commerce, and so can only be regulated by the states.

31. 1922: WORLD EVENTSEarly Foreshadowings of WWII • Ecuador & Egypt & Ireland Became Independent • Ottoman Empire Abolished • USSR Formed; Joseph Stalin appointed General Secretary of the Soviet Communist Party • Japan: Crown Prince Hirohito Became Prince-Regent • Italy: Mussolini & Fascists Take Power • Germany: Runaway Inflation; Stock Market Crash; Hitler Addressed 50,000 National Socialists in Munich

32. Justice Oliver Wendell Holmes • Born in 1841 • Fought in Civil War (Wounded at Antietam & Fredericksburg) • Wrote The Common Law (1881) • Appointed to US Supreme Court in 1902 • Served until 1932 (At time, oldest Justice ever) • Died in 1935

33. Justice Oliver Wendell Holmes "Holmes was a cold and brutally cynical man who had contempt for the masses and for the progressive laws he voted to uphold." Jeffrey Rosen, Brandeis's Seat, Kagan's Responsibility New York Times, July 2, 2010.

34. Justice Louis Brandeis • Born in 1856 • Progressive Cause Lawyering (Brandeis Brief) • Appointed to US Supreme Court in 1916 (first Jewish Justice) • Served until 1939; Died 1941

35. Justice Louis Brandeis “[T]he image of Brandeis, when [President] Wilson sent his name to the Senate … was one that frightened the Establishment. Brandeis was a militant crusader for social justice whoever his opponent might be. He was dangerous not only because of his brilliance, his arithmetic, his courage. He was danger-ous because he was incorruptible… . The fears of the Establishment were greater because Brandeis was the first Jew to be named to the Court.” -- Justice William O. Douglas

36. Holmes (1902) (HMS) Cardozo (1932) (CAR) Frankfurter (1939) (FFR) Goldberg (1962) (GBG) Fortas (1965) (FTS) Blackmun (1970) (BMN) Breyer (1994) (BRY) Brandeis (1916) (BDS) Douglas (1939) (DGS) Stevens (1975) (STV) Kagan (2010) (KGN) Holmes & Brandeis: Successors& Introduction to US SCt Abbreviations

37. Pennsylvania Coal Co. v. MahonKRYPTON: DQ3.12-3.13Introduction to Case and Arguments from Earlier Precedent

38. Pennsylvania Coal Co. v. MahonDQ3.12: Introduction (Krypton) Govt Action at Issue = Kohler Act (Forbids CCs from Causing Surface to Collapse While Mining if Certain Structures Present) • Purpose: Prevent Subsidence when Buildings on Surface (to further Safety and Welfare) • Is action rationally related • to protecting Safety? • to improving/protecting Welfare?

39. Pennsylvania Coal Co. v. MahonDQ3.12: Introduction (Krypton) Govt Action at Issue = Kohler Act (Forbids CCs from Causing Surface to Collapse While Mining • Preventing Subsidence when Buildings on Surface = Rationally Related to Safety & Welfare • Safety concerns possible re landscape after cave-ins even with proper notice. • Welfare concerns possible from • property values of non-contracting neighbors. • disruption of economy (Katrina issues) • environmental harms

40. Pennsylvania Coal Co. v. MahonDQ3.12: Introduction (Krypton) Govt Action at Issue = Kohler Act (Forbids CCs from Causing Surface to Collapse While Mining • What limits are placed on the CCs’ use of their property? • What uses of their property are still permissible?

41. Pennsylvania Coal Co. v. MahonDQ3.12: Introduction (Krypton) • CCs can mine coal so long as surface stays up; means must leave some coal in place. • What is the resulting harm to CCs? Uncertain! • Because of posture of case, no factual record • The two opinions differ as to extent of harm • Harm according to Holmes?

42. Pennsylvania Coal Co. v. MahonDQ3.12: Introduction (Krypton) • CCs can mine coal so long as surface stays up; means must leave some coal in place. • What is the resulting harm to CCs? • Uncertain because no factual record • Holmes: (very bottom of p.113) “warranted in assuming” statute makes mining “commercially impracticable”, so whole value gone. Harm according to Brandeis?

43. Pennsylvania Coal Co. v. MahonDQ3.12: Introduction (Krypton) • CCs can mine coal so long as surface stays up; means must leave some coal in place. • What is the resulting harm to CCs? • Uncertain because no factual record • Holmes: “warranted in assuming” whole value gone. • Brandeis: (2d line top of p.116) “For aught that appears [in the record] the value of the coal kept in place by the restriction may be negligible….”[Means?]

44. Mahon DQ3.12: Demsetz Takings Story (Krypton) Decision: Do CCs undermine surface when they mine? Old Rule (before Kohler Act)?

45. Mahon DQ3.12: Demsetz Takings Story (Krypton) Decision: Do CCs undermine surface when they mine? Old Rule: Can undermine surface if own subsidence rights Externalities?: Tricky Issue

46. Mahon: Externalities & Contract Rights • Direct harm to surface owners not an externality b/c not external to decisions/ activities of CCs. • CCs paid surface owners in advance for subsidence • As if Hadacheck sold land around factory • On condition that they’d allow brickworks to continue despite dust, etc.; and • Paid separately for the condition

47. Mahon: Externalities & Contract Rights • Direct harm to surface owners not an externality b/c not external to decisions/activities of CCs.BUT • Externalities beyond direct harm to surface owners • Costs to societyof loss of surface value & dislocation • Loose parallel: Contract to infect person w contagious disease to test treatment: • Voluntary to subject (so not externality) • Not voluntary to others who might get disease from subject (and to those who have to pay their medical costs, etc.)

48. Mahon: Externalities & Contract Rights • Direct harm to surface owners not an externality b/c not external to decisions/activities of CCs.BUT • Externalities beyond direct harm to surface owners • Also may worry K price may not reflect real value to society even of the specific land in Q • Did purchasers have equal bargaining power (e.g., if coal company workers) • Hard to value catastrophic harm many years away • Maybe like sale of human organs, we simply don’t trust that market operates properly

49. Mahon: Externalities & Contract Rights • Direct harm to surface owners not an externality b/c not external to decisions/activities of CCs.BUT • Externalities beyond direct harm to surface owners • Also may worry K price may not reflect real value • Could do analysis like “Contract void as against public policy.” Don’t allow or don’t enforce • Where K has large costs to non-contracting parties • Where we don’t trust that K can be fair

50. Mahon DQ3.12: Demsetz Takings Story (Krypton-D) Decision: Undermine surface? Old Rule: OK if own subsidence rights Externalities: Harm to non-parties/society (lost value/dislocation) Changes  Increased Externalities?