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67. Which of the following is the most appropriate result in the action?
In an action filed against the appropriate federal official, the company claims that the statute effected a taking of its property for which it is entitled to just compensation in an amount equal to the cost of the mining equipment it purchased and the profits it expected to earn from its mining operations on the land.
A company owned a large tract of land that contained coal deposits that the company intended to mine. The company acquired mining equipment and began to plan its mining operations. Just as the company was about to begin mining, Congress enacted a statute that imposed a number of new environmental regulations and land-reclamation requirements on all mining operations within the United States. The statute made the company's planned mining operations economically infeasible. As a result, the company sold the tract of land to a farmer. While the sale price allowed the company to recover its original investment in the land, it did not cover the additional cost of the mining equipment the company had purchased or the profits it had expected to earn from its mining operations on the land.
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Use restrictions will also constitute a taking if there is a denial of all economic value of land because such a regulation is equivalent to a physical appropriation. If the regulation merely decreases the value of the property (e.g., prohibits its most beneficial use), it will not necessarily result in a taking as long as an economically viable use for the property remains. The Court considers: (i) the social goals sought to be promoted; (ii) the diminution in value to the owner; and (iii) whether the regulation substantially interferes with distinct, investment-backed expectations of the owner. Penn Cent. Transp. Co. v. New York, 438 U.S. 101 (1978).
D is correct. The company should not prevail on any aspect of its claim for just compensation. The statute did not amount to a taking of the company's land or of the mining equipment because the new regulations did not deny all economically viable use of the land or equipment. The company recovered its original investment in the land by selling it to the farmer, and the land is economically viable as farmland. The company may sell the mining equipment or use it for mining on other land. Finally, the profits the company expected to earn from its mining operations do not constitute a property interest subject to the Takings Clause.
A is incorrect. As explained above, the company should not prevail on its claims for just compensation based on either the cost of the mining equipment or lost profits. This is because the federal statute does not deprive the company of all economically viable use of the land as required by the Takings Clause.
B is incorrect. This answer is only partially correct. Although it is true that the company should not prevail on its claim for the lost profits, it should also not prevail on its claim for the cost of the mining equipment because it can sell or use the equipment on other land.
C is incorrect. This answer is also only partially correct. As explained above, the company should not prevail on any aspect of its claim for just compensation, including its claim for lost profits or its claim for the cost of the mining equipment.