TrinCo Investment Co. v. United States , 722 F.3d 1375 ( 2013 )

United States Court of Appeals
for the Federal Circuit
______________________
TRINCO INVESTMENT COMPANY, AND
KATHLEEN G. ROSE, trustee of the V&M Rose –
Marital Trust,
Plaintiffs-Appellants,
v.
UNITED STATES,
Defendant-Appellee.
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2012-5139
______________________
Appeal from the United States Court of Federal
Claims in No. 11-CV-0857, Judge Bohdan A. Futey.
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Decided: July 18, 2013
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MATTHEW J. DOWD, Wiley Rein, LLP, of Washington,
DC argued for plaintiffs-appellants. Of counsel on the
brief was WESLEY HIGBIE, Higbie Law Office, of San
Mateo, California.
NINA C. ROBERTSON, Attorney, Appellate Section, En-
vironment & Natural Resources Division, United States
Department of Justice, of Washington, DC, argued for
defendant-appellee. With her on the brief was IGNACIA S.
MORENO, Assistant Attorney General.
2 TRINCO INVESTMENT COMPANY v. US
______________________
Before RADER, Chief Judge, and MOORE, Circuit Judge,
and BENSON, District Judge. ∗
BENSON, District Judge.
TrinCo Investment Company and Kathleen G. Rose
(collectively “TrinCo”) appeal the decision of the United
States Court of Federal Claims (“CFC”) granting the
Government’s Motion To Dismiss. The CFC found that
TrinCo failed to plead facts sufficient to support a takings
claim against the Government following the destruction of
1,782 acres of TrinCo’s merchantable timber as a result of
a United States Forest Service fire management effort.
Because we find that TrinCo pled sufficient facts to
state a claim for relief that is plausible on its face, we
reverse and remand.
BACKGROUND
Appellants collectively own five pieces of real property
in California. Appellant TrinCo Investment Company, a
California limited partnership, owns four pieces of proper-
ty: the Squaw Camp Property, the Price Creek Property,
the Mud Springs Property, and the Eltapom Rose Proper-
ty. These properties consist of 714, 524.3, 529.5 and 604.8
timbered acres respectively, all of which are surrounded
by the Shasta-Trinity National Forest. Appellant Kath-
leen G. Rose is a trustee of the V&M Rose Trust-Marital
Trust. The Rose Trust owns the V&M Bottoms Property
which consists of 57 timbered acres which are adjacent to
the Shasta-Trinity National Forest.
The Shasta-Trinity National Forest is the largest na-
tional forest in California, encompassing approximately
Honorable Dee V. Benson, United States District
∗
Court for the District of Utah, sitting by designation.
TRINCO INVESTMENT COMPANY v. US 3
2.1 million acres. See U.S. Dep’t of Agriculture, Forest
Service, Shasta-Trinity National Forest: About the Forest,
at http://www.fs.usda.gov/main/stnf/about-forest. In
June, 2008, a series of wildfires burned within the Shas-
ta-Trinity National Forest. The United States Forest
Service (“Forest Service”) named these fires the “Iron
Complex” fire. In response to the Iron Complex fire, the
Forest Service intentionally lit fires directly on and adja-
cent to TrinCo’s properties in order to reduce unburned
timber which might fuel the Iron Complex fire. These
intentional fires caused damage to TrinCo’s properties,
burning 714 acres of Squaw Camp, 92 acres of Eltapom
Rose, 395.1 acres of Mud Springs, 524.3 acres of Price
Creek, and 57 acres of V&M Bottoms in July and August
of 2008.
TrinCo’s complaint alleges that the Iron Complex fire
would not have burned any of its land. However, the
Forest Service’s intentional fires destroyed 1,782 acres of
TrinCo’s merchantable timber valued at approximately
$6.6 million. TrinCo asserts that the damages caused by
the Forest Service’s conduct constitute a taking for which
it should be compensated under the Fifth Amendment to
the Constitution of the United States.
The Government moved to dismiss the case before the
CFC under Rule 12(b)(6) of the Rules of the United States
Court of Federal Claims (“RCFC”) for failure to state a
claim upon which relief can be granted. The Government
asserts that the intentional lighting of fires by the Forest
Service to manage existing wildfires cannot sustain a
plausible takings case because the doctrine of necessity
absolves the Government from liability for any taking or
destruction of property in efforts to fight fires. The CFC
granted the motion to dismiss. TrinCo now appeals that
decision.
4 TRINCO INVESTMENT COMPANY v. US
DISCUSSION
Our jurisdiction arises under 28 U.S.C. § 1295(a)(3).
Because we are reviewing a dismissal under RCFC
12(b)(6) “the court accepts all well-pleaded factual allega-
tions as true and draws all reasonable inferences in the
claimant’s favor.” Lindsay v. United States, 295 F.3d
1252, 1257 (Fed. Cir. 2002).
The Fifth Amendment to the Constitution provides
that “private property [shall not] be taken for public use,
without just compensation.” U.S. CONST. amend. V. As
its language indicates, “this provision does not prohibit
the taking of private property, but instead places a condi-
tion on the exercise of that power.” First English Evan-
gelical Lutheran Church of Glendale v. Cnty. of Los
Angeles, 482 U.S. 304, 314 (1987). However, the United
States Supreme Court has observed that the “common law
ha[s] long recognized that in times of imminent peril—
such as when fire threatened a whole community—the
sovereign could, with immunity, destroy the property of a
few that the property of the many and the lives of many
more could be saved.” United States v. Caltex, 344 U.S.
149, 154 (1952). This principle, “absolving the State…of
liability for the destruction of ‘real and personal property,
in cases of actual necessity, to prevent’…or fore-
stall…grave threats to the lives and property of others,” is
commonly referred to as the “doctrine of necessity” or the
“necessity defense.” Lucas v. S.C. Coastal Council, 505
U.S. 1003, 1029 n.16 (1992).
The CFC relied upon this doctrine of necessity when it
held that TrinCo’s complaint failed to plead facts suffi-
cient to support a takings claim against the Government.
In particular, the CFC relied upon its interpretation of a
footnote in Lucas v. S.C. Coastal Council, which refers to
the doctrine of necessity as “absolving the State . . . of
liability for the destruction of ‘real and personal property,
in cases of actual necessity, to prevent the spreading of a
TRINCO INVESTMENT COMPANY v. US 5
fire.’” 505 U.S. 1029 n.16 (quoting Bowditch v. City of
Boston, 101 U.S. 16, 18–19 (1880)). However, the CFC
misapprehended the reach of the doctrine of necessity,
impermissibly expanding its scope to absolve the Gov-
ernment of liability for any of its actions so long as they
are part of an effort to control or prevent fire. While it is
true that the Supreme Court has recognized that there
are circumstances in which the doctrine of necessity
protects the Government from the requirement that it
provide compensation for the taking or destruction of
property committed to stop a fire, see Bowditch, 101 U.S.
at 18–19, the CFC’s decision to extend the doctrine of
necessity to automatically absolve the Government’s
action in any case involving fire control stretches the
doctrine too far.
While there is no case law on point for TrinCo’s case,
the existing precedent indicates that there are certain
prerequisites that must be met before the doctrine of
necessity can be applied to absolve the Government of a
duty to compensate a party for lost property. The Su-
preme Court has consistently held that the doctrine of
necessity may be applied only when there is an imminent
danger and an actual emergency giving rise to actual
necessity. See Bowditch, 101 U.S. at 16–19; Ralli v.
Troop, 157 U.S. 386, 405 (1985); Caltex, 344 U.S. at 151–
56; Mitchell v. Harmony, 54 U.S. 115, 135 (1851).
For instance, in Bowditch, the Supreme Court applied
the doctrine of necessity to absolve the City of Boston of
liability for the actions of its “fire-engineers” who demol-
ished a building that was not yet burning, but was located
“at a place of danger in the immediate vicinity [of a fire],
to arrest the spreading of the fire.” 101 U.S. at 16. The
Court noted that “the measure [i.e., destroying the build-
ing] stopped the progress of the fire.” Id. Ultimately, the
Court found that “[a]t the common law everyone had the
right to destroy real and personal property, in cases of
actual necessity, to prevent the spreading of a fire, and
6 TRINCO INVESTMENT COMPANY v. US
there was no responsibility on the part of the destroyer,
and no remedy for the owner.” Id. at 18–19. The Court
emphasized the need for an imminent danger and an
actual emergency necessitating the Government taking,
stating that the “rights of necessity” which were a part of
the common law and a principle of natural law relied on
“imperative necessity” as legal justification. Id. at 18–19;
see also Ralli v. Troop, 157 U.S. at 405 (stating that
“either public officers or private persons my raze houses
to prevent the spreading of a conflagration” without being
“bound to compensate for or to contribute to the loss,” but
that “this right rests on public necessity”).
The Supreme Court further emphasized the doctrine
of necessity’s prerequisites of imminent danger and actual
emergency necessitating Government action in United
States v. Caltex, 344 U.S. 149 (1952). In Caltex the Su-
preme Court found that no compensable taking had
occurred when the United States Military requisitioned
and destroyed oil facilities in the Philippines during
World War II “[i]n the face of a Japanese advance.” Id. at
151. The oil companies’ properties were requisitioned on
December 25, 1941 when a Japanese advance was immi-
nent. Id. On December 27, while Japanese planes were
bombing the area in which the facilities were located, the
oil companies were directed to destroy “all remaining
petroleum products and the vital parts of the plants.” Id.
On December 31, while Japanese troops were entering the
area, Army personnel completed a successful demolition
of the oil facilities. The Army paid the oil companies for
the petroleum stocks and transportation equipment which
were either used or destroyed by the Army, “but it refused
to compensate [the companies] for the destruction of
the . . . facilities.” Id. The oil companies sued, “[c]laiming
a constitutional right under the Fifth Amendment to just
compensation.” Id. The Supreme Court acknowledged
that “[n]o rigid rules can be laid down to distinguish
compensable losses from non-compensable losses” and
TRINCO INVESTMENT COMPANY v. US 7
that “[e]ach case must be judged on its own facts.” Id. at
156. It went on to hold that “[t]he terse language of the
Fifth Amendment is no comprehensive promise that the
United States will make whole all who suffer from every
ravage and burden of war.” Id. The Supreme Court held
further that the destruction of the facilities “in the face of
their impending seizure by the enemy” was a necessary
and non-compensable taking because of the actual neces-
sity of the action in the face of an imminent danger and
actual emergency. Id.; see also Mitchell v. Harmony, 54
U.S. at 135 (stating that for a taking to be justified during
wartime the “danger must be immediate and impending”
or the “necessity urgent . . . such as will not admit delay”
because “it is the emergency that gives the right [to the
Government to take private property], and emergency
must be shown to exist before the taking can be justi-
fied”).
This Supreme Court precedent requires an actual
emergency with immediate and impending danger to
support a necessity defense. These requirements are
similarly apparent in the application of the necessity
defense by state courts. For instance, in Customer Co. v.
City of Sacramento, the Supreme Court of California held
that a store owner could not recover for damages to a
building sustained as a result of police efforts to appre-
hend a suspect who had taken refuge in that building.
895 P.2d 900, 901–17 (Cal. 1995). The Supreme Court of
California held that the “doctrine of noncompensable loss
comes into play in connection with more direct ‘taking’ or
‘damaging’ of property only under ‘emergency’ conditions;
i.e., when damage to private property is inflicted by
Government ‘under pressure of public necessity and to
avert impending peril.’” Id. at 910 (emphasis added)
(quoting Holtz v. Superior Court, 475 P.2d 441, 446 (Cal.
1970)); see also House v. Los Angeles County Flood Control
District, 153 P.2d 950, 953 (Cal. 1944) (holding that
8 TRINCO INVESTMENT COMPANY v. US
dismissal of a takings claim was not warranted when no
emergency existed).
The Supreme Court of Texas recognized similar re-
quirements in Steele v. City of Houston, 603 S.W.2d 786
(Tex. 1980). The Texas Supreme Court held that the
necessity defense did not protect the City of Houston from
liability for damage to a property caused by police firing
incendiary devices into a house in an attempt to drive out
and capture escaped convicts who were hiding within it.
In making this holding the Texas court noted that while
the “defendant City of Houston may defend its actions by
proof of a great public necessity,…[m]ere convenience will
not suffice.” Id. at 792. The Texas Supreme Court ulti-
mately held that the City of Houston had only offered
scant proof of the necessity driving its actions, and there-
fore was not protected by the necessity defense. Id.
No precedent exists to support the assertion that any
action taken for the purpose of fire prevention is protected
by the necessity doctrine in the absence of actual emer-
gency, imminent danger, and the actual necessity of the
Government action. Therefore, the CFC’s decision hold-
ing that the taking or destruction of any property in the
pursuit of fighting a fire, regardless of the circumstances,
is non-compensable misconstrues the breadth of the
doctrine of necessity.
The facts, as they are pled in TrinCo’s complaint, do
not demonstrate that the Iron Complex fire had created
an imminent danger and an actual emergency necessitat-
ing the burning of 1,782 acres of TrinCo’s timbered acre-
age. The facts certainly do not support the kind of
imminent danger and actual emergency posed by a fire
burning in a populated city, as in Bowditch, or an invad-
ing enemy army, as in Caltex. Therefore, dismissal of the
complaint under RCFC 12(b)(6) based on the doctrine of
necessity was inappropriate.
TRINCO INVESTMENT COMPANY v. US 9
To avoid dismissal under RFCF 12(b)(6), a party need
only plead “facts to state a claim to relief that is plausible
on its face,” with facts sufficient to nudge “claims across
the line from conceivable to plausible.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007). A claim is plausible
on its face when “the plaintiff pleads factual content that
allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.” Ashcroft
v. Iqbal, 556 U.S. 662, 678 (2009).
It is certainly plausible that the Iron Complex fire did
not pose an imminent danger or actual emergency neces-
sitating the destruction of such a sizable portion of Trin-
Co’s property. TrinCo has suffered an actual harm and
pled facts that give rise to a plausible claim for relief. It is
impossible, without further inquiry, to determine whether
the requisite imminent danger and actual emergency
giving rise to the actual necessity of the Forest Service’s
burning of TrinCo’s property was present to absolve the
Government under the doctrine of necessity. TrinCo’s
complaint is sufficient to survive dismissal at this early
stage of the proceedings.
SUMMARY & CONCLUSION
In the proceedings below, the Government advanced,
and the CFC accepted, the position that any act under-
taken by the Government in connection with fighting a
fire is covered by the necessity defense. Therefore, the
court found that TrinCo’s complaint could not support a
claim for relief because the complaint acknowledged that
TrinCo’s property was taken by the Government while
fighting the Iron Complex fire of 2008.
As addressed above, however, every taking by the
Government in the name of fire control does not automat-
ically qualify as a necessity sufficient to satisfy the re-
quirements of the necessity defense. The necessity
defense is just what it says it is: a defense. It has always
required a showing of imminent danger. The use of the
10 TRINCO INVESTMENT COMPANY v. US
word “necessity” in the title is no accident. The defense
requires both an actual emergency and an imminent
danger met by a response that is actually necessary. Not
every seizure of a private citizen’s property will qualify.
In the case below there are legitimate questions as to
imminence, necessity, and emergency. While there is no
doubt that there was a fire, there is also no doubt that at
the time TrinCo’s property was burned, only approximate-
ly 2% of the 2.1 million-acre national forest was in flames.
It is clearly relevant to the present case to learn in discov-
ery why the Plaintiff’s property had to be sacrificed, as
opposed to other property, including other portions of the
National Forest itself. It would be a remarkable thing if
the Government is allowed to take a private citizen’s
property without compensation if it could just as easily
solve the problem by taking its own.
REVERSED AND REMANDED