Real Estate & Property Law

Lessons For Superferry From The Kelo Aftermath?

By Robert Thomas (inversecondemnation.com)

"One more victory such as this and we shall be ruined."

So lamented Pyrrhus, the king of the eponymous victory -- a win so costly it cannot be savored. It's a term the New London Development Corporation, which prevailed in U.S. Supreme Court in the now-infamous eminent domain case Kelo v. City of New London, 545 U.S. 469 (2005) must know all too well. After its victory permitting the condemnation of people's homes for "economic development," not only did the public revulsion at the outcome result in a majority of states attempting to curtail eminent domain, the NLDC's Fort Trumbull project shriveled up in the glare of public scrutiny and outrage and the properties seized remain vacant. The case stands as a lesson for litigants who believe that a court decision represents the final word on an issue.

If the public reaction to the Hawaii Supreme Court's decision in round 2 of the Hawaii Superferry case is any measure, Kelo may offer some lessons. A review of some of the comments following the reports about the court's decision and its consequences by Honolulu's two daily papers reveals a surprising level of anger and frustration:

• Disruptions from Superferry shutdown feared (Honolulu Advertiser)

• Layoffs follow high court ruling on Superferry (Honolulu Star-Bulletin)

• Hawaii Superferry to start laying off workers as of tomorrow (Advertiser)

• Disruptions from Superferry shutdown feared (Advertiser)

The editorial pages are also getting into it:

• What now, environmentalists? (Advertiser editorial blog)

Environmental and community-action groups such as the Sierra Club and Maui Tomorrow now find themselves in the crosshairs of many residents frustrated by recent developments with the Hawaii Superferry.

• Ending Superferry service would be a blow to Hawaii (Star-Bulletin)
  

  As a result, the notion of an unfriendly business climate in Hawaii gains credibility; an enterprise with nearly 300 employees has been shut down indefinitely, maybe permanently; travelers, farmers and others who have come to rely on the service are left without service; and the state faces a possible loss of millions of dollars in ferry revenue and further litigation.

Like Kelo, the two Hawaii Superferry decisions by the Hawaii Supreme Court have starkly illustrated for the public the practical consequences of the laws they accede to. In Kelo, the veil was finally lifted from the public's eyes as to how eminent domain really works, and the inherent unfairness in how the condemnation power is exercised.  After Superferry, it seems people are beginning to understand how environmental laws can be leveraged to take down a popular service that has appeared to inflict no environmental harm for the year it has been in operation. Make no mistake: the goal of the litigation was never simply to protect the process and insure that all information was gathered so that a good decision would result -- it was designed, at least in part, as DBTD - Death By a Thousand Days. And it appears to have succeeded.

It remains to be seen whether the anger expressed translates to action as in Kelo and whether the legislature will consider streamlining or revising the EA/EIS process. For an example of how the U.S. Supreme Court dealt with a similar issue, see this post on Winter v. Natural Resources Defense Council, Inc., No. 07-1239 (Nov. 12, 2008).

Full post as published by inversecondemnation on March 19, 2009 (boomark / email).