On November 13, 2020, the U.S. Supreme Court issued an order granting certiorari in Cedar Point Nursery v. Hassid.  The question presented in the successful cert petition is “whether the uncompensated appropriation of an easement that is limited in time effects a per se physical taking under the Fifth Amendment.”

The underlying case—Cedar Point Nursery v. Shiroma, 923 F.3d 524 (2019)—is a 2-1 Ninth Circuit panel opinion holding that a California regulation allowing union organizers access to agricultural employees on employers’ private property, to communicate about union organization, is governed by regulatory takings standards and is not a per se categorical taking.  The Ninth Circuit denied a petition for rehearing en banc.  956 F.3d 1162 (9th Cir. 2020).

As we previously wrote, the access regulation authorized by California’s Agricultural Labor Relations Act declares that the rights of agricultural employees include “the right of access by union organizers to the premises of an agricultural employer for the purpose of meeting and talking with employees and soliciting their support.”  Although the access right is not unlimited, as the regulation imposes several restrictions relating to time, place, number of organizers, purpose, and conduct, the regulation allows union organizers to enter the private property of agricultural growers 120 days per year for up to three hours at a time.

In the district court litigation the plaintiff landowners alleged that the United Farm Workers union disrupted work by moving through their trim sheds with bullhorns, distracting and intimidating workers, and violated the access regulation by failing to provide the required written notice before taking access.  In suing for declaratory and injunctive relief under 42 U.S.C. section 1983, the plaintiffs alleged that the access regulation creates an easement that allows union organizers to enter their property “without consent or compensation” in violation of the Takings Clause of the Fifth Amendment.

The plaintiffs based their takings argument entirely on the theory that the access regulation, as applied to them, constitutes a permanent physical invasion of their property, having no contemplated end-date, and is thus a per se taking under Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419 (1982).  In Loretto, the Supreme Court held that a minor but permanent physical occupation of an owner’s property, authorized by government, constitutes a “taking” of property for which just compensation is due.  “Where governmental action results in a permanent physical occupation” of the property, by the government itself or by others, our cases uniformly have found a taking to the extent of the occupation, without regard to whether the action achieves an important public benefit or has only minimal economic impact on the owner.”

The Ninth Circuit panel majority agreed with the district court and determined that the plaintiffs’ argument that the access regulation is a permanent physical occupation, as opposed to a temporary invasion, is contradicted by both PruneYard Shopping Center v. Robins, 447 U.S. 74 (1980) and Nollan v. California Coastal Commission, 483 U.S. 825 (1987).

PruneYard is most famously a free speech case dealing with the PruneYard, a privately-owned shopping center open to the public.  But the case also addressed a takings claim about which the Supreme Court concluded that requiring the shopping center to permit exercise of state-protected rights of free expression and petition on shopping center property does not amount to an unconstitutional infringement of the PruneYard’s property rights under the Taking Clause.

The Ninth Circuit determined that the Cedar Point Nursery plaintiffs did not suffer a permanent physical invasion that would constitute a per se taking because “the sole property right affected” by the regulation is the right to exclude, which in the panel majority’s view is just one of the essential “sticks” in the “bundle of property rights.”  Relying on a crabbed reading of Loretto, the majority reasoned that in a permanent physical invasion the government does not simply take a single strand from the bundle of property rights: “it chops through the bundle, taking a slice of every strand.”

The majority also rejected the plaintiffs’ argument under Nollan, which held that an easement for public access across private property, “where individuals are given a permanent and continuous right to pass to and fro, so that the real property may continuously be traversed, even though no particular individual is permitted to station himself permanently upon the premises,” constituted a permanent physical taking.  Narrowly reading Nollan, the Ninth Circuit reasoned that although the union access regulation does not have a contemplated end-date, it does not meet the definition of a permanent physical occupation because it does not grant union organizers a permanent and continuous right of access.

The Ninth Circuit’s decision essentially allows the government to eliminate a landowner’s right to exclude, without compensation, so long as the regulation at issue does not require the grant of permanent, 24/7 access.  In so doing, the Ninth Circuit has reduced the importance of a landowner’s right to exclude to a practical nullity.  In the most clinical sense, Cedar Point Nursery thus provides the Supreme Court an opportunity to clarify the meaning of “permanent physical invasion” in takings law and affirm that per se rules govern physical takings cases regardless of the extent of the unwanted intrusion.  But in the more colorful reality, in this collision of labor union organizing laws and property rights, we anticipate the Supreme Court—with newly confirmed Associate Justice Amy Coney Barrett—will deliver a resounding victory for property rights.


Questions? Please contact Bryan W. Wenter, AICP of Miller Starr Regalia.

For more than 50 years, Miller Starr Regalia has served as one of California’s leading real estate law firms. Miller Starr Regalia has expertise in all types of real property matters, including full-service litigation and dispute resolution, transactions, acquisitions, dispositions, leasing, financing, common interest development, construction, management, eminent domain and inverse condemnation, exactions, title insurance, environmental law, and land use. Miller Starr Regalia attorneys also write Miller & Starr, California Real Estate 4th, a 12-volume treatise on California real estate law. “The Book” is the most widely used and judicially recognized real estate treatise in California and is cited by practicing attorneys and courts throughout the state. For more information, visit www.msrlegal.com.