Forced Turnovers: Using Eminent Domain to Build Professional Sports Venues

• Citation: Vol. 9 No. 4
• Publication year: 2014

Washington Journal of Law, Technology and Arts Volume 9, Issue 4 Spring 2014

Forced Turnovers: Using Eminent Domain to Build Professional Sports Venues

Peter Montine (fn*)© Peter Montine

ABSTRACT

If a city wants to keep a professional sports team within its borders, can that city use the power of eminent domain to do so? Although cities have not been able to successfully condemn the actual sports franchises within their respective cities, they have been successful in condemning land for the development of new sports venues intended to entice their teams to stay. In 2005, the City of Arlington, Texas invoked the power of eminent domain to condemn and destroy houses to make room for the Dallas Cowboys' new stadium. In 2006, New York City used eminent domain on land belonging to private businesses in order to make room for construction of a new arena for the New Jersey Nets.

Recently, three other major American cities (Sacramento, Atlanta, and Washington, D.C.) announced that they are prepared to use eminent domain to build new sports stadiums for their local professional sports teams. While there are a few strategies that property owners could hypothetically use to stop these takings, courts have yet to stop a city from using eminent domain to condemn land for sports stadiums. However, if property owners are willing to settle, these same strategies can help prolong condemnation negotiations, thereby increasing the owners' potential remunerations.

TABLE OF CONTENTS

Introduction..................................................................................332

I. Condemning Land for the Development of New Sports Stadiums is a Valid Use of Eminent Domain.......................334

A. The City of Arlington Built ATandT Stadium for a Legitimate Public Purpose.............................................335

B. New York City Built the Barclays Center as Part of the Redevelopment of a Blighted Area...............................337

C. Condemning Sports Franchises is Harder than Condemning Land for New Sports Venues...................339

II. Strategies for Challenging a City's Use of Eminent Domain to Develop a New Professional Sports Venue........341

A. Dispute the Sports Venue's Actual Public Use...............342

B. Question the Legitimacy of the Eminent Domain Proceedings....................................................................343

C. Contest the Proposed Area's "Blighted" Classification...345

D. Take Legislative Action...................................................346

Conclusion...................................................................................347

Practice Pointers...........................................................................348

INTRODUCTION

In order to convince their local sports teams to stay, cities have turned to the power of eminent domain to provide land for the development of new sports venues.(fn1) Arlington, Texas, and New York City have used eminent domain in the past eight years to build new venues for their respective professional sports franchises. Courts upheld challenges to Arlington's use of eminent domain in Cascott, L.L.C. v. City of Arlington,(fn2) and New York City's use in Goldstein v. Pataki.(fn3) Within the last year, three more cities-Sacramento, Washington, D.C., and Atlanta-have all announced their readiness to use eminent domain to build new venues for their own professional sports franchises.(fn4) so far, courts have consistently agreed that condemning land for new sports venues is a valid use of the power of eminent domain. This Article will first examine the power of eminent domain, its origins, and its contemporary usage. Next, this Article will discuss how eminent domain law has been applied in sports venue cases and other related cases, and in doing so demonstrate that using eminent domain to build a new sports venue is a difficult process to fight. Finally, this Article will provide practical suggestions for how attorneys can prevent their cities from using this power to seize their clients' property, or in the alternative, help their clients receive more compensation for the property taken. In dicta, courts have noted that the use of eminent domain to develop sports venues would be improper in cases where the venue would not be for a public purpose, the eminent domain proceedings were faulty, or an area set for redevelopment was not actually blighted. Even though courts have made it difficult to show that any of these circumstances exist, these are the best arguments that practitioners have to oppose these condemnations. If a client does not wish to keep their property but merely wants to increase their compensation, then employing these challenges could promote negotiation of greater remuneration.

I. CONDEMNING LAND FOR THE DEVELOPMENT OF NEW SPORTS STADIUMS IS A VALID USE OF EMINENT DOMAIN

Eminent domain is "[t]he inherent power of a governmental entity to take privately owned property, esp[ecially] land, and convert it to public use, subject to reasonable compensation for the taking."(fn5) The Fifth Amendment to the United States Constitution limits the power of eminent domain: "a person cannot be . . . deprived of private property for public use without just compensation."(fn6) This limitation is "made applicable to the States through the Fourteenth Amendment."(fn7)

The United States Supreme Court has defined many of the elements of eminent domain. The Supreme Court has held that the federal government may use the power of eminent domain to condemn both tangible and intangible property.(fn8) It has also defined "public use" broadly.(fn9) Finally, the Court has found that the property owner "is entitled to be put in as good a position pecuniarily as if his property had not been taken."(fn10) However, states can impose greater restrictions on their powers of eminent domain; indeed, the public response to the Supreme Court's decision in Kelo v. City of New London was so strong that many states have substantially reformed their powers of eminent domain.(fn11)

Courts have regularly allowed cities to use eminent domain to develop new public sports venues. Arlington and New York City were both successful in their uses of eminent domain to condemn land for new sports venues. Both of these projects were met with heavy resistance from the local communities, yet were upheld by courts as legitimate uses of eminent domain.(fn12) This contrasts sharply with the difficulties cities have had in the past when attempting to use eminent domain to acquire the sports franchises themselves. Both Oakland and Baltimore attempted to condemn their city's sports teams through eminent domain but were barred by courts from doing so. The differences between the uses of eminent domain for the development of new sports venues and the control of sports franchises can help practitioners advise property owners on ways to prevent the taking of their clients' property, or increase the amounts they receive as just compensation for their property.

A. The City of Arlington Built ATandT Stadium for a Legitimate Public Purpose

In 2004, Arlington announced its plans to build a new stadium for the Dallas Cowboys football team, and the Court of Appeals of Texas allowed this use in Cascott, L.L.C. v. City of Arlington.(fn13) The City purchased some of the properties in the proposed location and began eminent domain proceedings against properties when their owners would not negotiate.(fn14) A special commissioner issued monetary awards to all the resisting property owners in order to satisfy the just compensation requirement.(fn15) These property owners appealed their awards and the City's use of eminent domain to the local Texas County Court at Law.(fn16) The trial court granted summary judgment to the City and the property owners appealed.(fn17)

The property owners' main argument was that the City's use of eminent domain violated the Texas Constitution because it failed to satisfy the "public purpose" requirement.(fn18) on this issue, the court noted that "[t]he mere fact that a private actor will benefit from a taking of property for public use . . . does not transform the purpose of the taking of the property, or the means used to implement that purpose...