Posted by Ilya Somin:
An Unpersuasive Defense of Judge Sotomayor's Ruling in the Didden Case:
http://volokh.com/archives/archive_2009_05_31-2009_06_06.shtml#1243972122
Daniel Hemel has what I think is an unpersuasive defense of Judge
Sonia Sotomayor's ruling in the Didden case, which I criticized
[1]here. In that case, a the Village of Port Chester condemned a
property when the owners refused to pay $800,000 to the city's
designated developer for the area. For reasons I explained in the
earlier post, this case goes beyond even Kelo v. City of New London in
licensing the condemnation of private property for the benefit of
other private interests.
Hemel, however, has a different take on the facts that he claims
justifies the decision:
According to Didden [one of the owners of the condemned property],
G&S chief Gregg Wasser demanded an $800,000 payment or else he
would have the village condemn the land and hand it to G&S. The
village did indeed condemn the property the next day, although it
paid Didden $975,000 in compensation. Didden sued the village in
U.S. District Court, lost and appealed the case....
Wasser's $800,000 offer came at a November 2003 meeting with Didden
and his business partner Domenick Bologna. The attendees do not
agree on what happened at that session, but Wasser's account
appears to be--at the very least--a plausible one. Wasser says he
told Didden and Bologna that "it would be a waste of time for the
lawyers to argue over who had 'better' rights to proceed with their
project" and that the parties should settle the matter themselves.
inner of the dispute would make a $2 million profit but that
"whoever would be responsible for completing the project should be
given some credit and was entitled to more than a 50-50 split." He
said that whichever party proceeded with its drug store plans
should pay the other $800,000, and he added that he was willing to
take either end of the deal.
In retrospect, Wasser's offer appears to have been quite generous
because he had strong reason to believe that he would win in court
(as he ultimately did).
While Didden's backers say that Wasser's offer was extortion, it
looks like it might have been an innocuous settlement
proposal--standard fare for legal disputes. Unless Didden and
Bologna could prove their side of this "he said, he said" spat (and
they could not), Judge Sotomayor was correct to conclude that
Wasser's "voluntary" attempt to settle the dispute "was neither an
unconstitutional exaction in the form of extortion nor an equal
protection violation."
There are two major problems with Hamel's defense of Sotomayor's
rulings. First, the case was at the summary judgment stage, which
means that the Village was moving to dismiss the case without sending
it to a jury for adjudication of factual disputes. When considering a
summary judgment motion, federal courts are required to consider the
evidence "in the light most favorable to the non-moving party." If it
really was a "he said, he said" situation in which neither side could
independently verify their version of events, Judge Sotomayor and her
panel had a duty to assume that Didden and his co-owner were telling
the truth.
Second, Wasser's proposal was extortionate even if he was telling the
truth. If Wasser's version of events is correct, he in effect gave
Didden and Bologna two options: pay him $800,000 or 50% of the
proceeds of their project for the right to proceed with the
construction of a CVS on their land or transfer the land to him in
exchange for an $800,000 payment from Wasser. Hamel claims that the
inclusion of this second option makes the offer nonextortionate and
even "generous." It was no such thing. As Hamel himself notes, the
land was worth at least $975,000 (the amount the city paid Didden and
Bologna as compensation for the taking). Thus, Hamel's alternative
offer was an offer to pay the owners $175,000 less than they could get
even in an eminent domain proceeding (which often end up
undercompensating owners).
If Wasser's account is correct, he simply made two different
extortionate offers, using the theat of eminent domain as leverage;
his "generosity" consisted of letting the victims choose between the
two unsavory options. One can characterize this is as a "settlement
proposal" which is "standard fare for legal disputes." But there would
have been no "legal dispute" in the first place if not for Wasser's
threat to have the property condemned unless his demands were met. If
this is not extortion using the threat of eminent domain as leverage,
it's hard to see what would be.
In sum, Hamels' attempted defense fails to justify Judge Sotomayor's
extremely dubious decision in Didden. If anything, it highlights her
failure to properly apply the summary judgment standard in this
important case.
References
1. http://volokh.com/posts/1243364120.shtml
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