7 Days & 60 Minutes

December 2003

Institute Earns Property Rights Triumphs In Rapid Succession

By John E. Kramer

Who could have guessed a week that began so dismally for private property would be so quickly followed by three major victories advancing this fundamental right? Before the next week would end, IJ would win in court on behalf of clients in New York and Arizona, and in the court of public opinion on 60 Minutes.

On Monday, September 22, New York Gov. George Pataki vetoed eminent domain reform that would have required condemning authorities to provide individual notice to property owners when their land was being considered for condemnation. The only notification state law now requires is a tiny legal notice buried in a newspaper’s classified ad section. The ad need not even list the address of the properties in question or inform the owners that they must appeal the possible taking within 30 days or they waive a constitutional defense to their land.

The veto was a disappointment not only for the Institute for Justice, which reviewed the legislation that both houses passed overwhelmingly, but for IJ client Bill Brody, who is fighting to save his property that was taken through this governmental sleight of hand by the Village of Port Chester in New York. Brody lovingly restored and leased out four connected buildings on Port Chester’s main street as a means of providing for his wife and three young daughters. While Brody completed his work, the Village placed its ad in connection with his property. After it was too late for him to act, the Village informed Brody that it planned to take his properties not for a public use, but for a parking lot for a nearby Stop & Shop supermarket. Despite IJ’s continuing efforts in federal court to protect what was rightfully his, the Village took possession of his property and—even though his legal claims were still unresolved—bulldozed three of his buildings. All seemed lost for Brody.

Victory for Bill Brody & NY Property Rights

But what a difference a couple of days make.

Two days after the veto, IJ Senior Attorney Dana Berliner walked out of her office as if on air.

“What is it?” I asked.

She pointed to some papers in her hand. “We won Brody,” she beamed. Despite the fact that we lost in federal trial court, and the fact that the 2nd Circuit Court of Appeals permitted the Village to demolish Brody’s buildings while he appealed his case, that same 2nd Circuit had just cleared the way for our constitutional challenge to New York’s eminent domain laws. The procedural thicket the Village concocted to prevent Brody from contesting the constitutionality of New York’s eminent domain laws was torn out by its roots.

It took three years, 18 briefs, four court arguments, and losses in trial court and two appeals courts—all the while facing two private law firms hired by the state—but we finally won. Brody will get his day in court.

Brody told reporters, “I’m ecstatic. The court understood what a mess New York’s law is. I want the law changed not only to defend me, but anyone who owns property in New York. Being individually notified with something more than a classified ad that the government is looking to take your land is not too much to ask for. It is common sense and common decency. No one should have to go through what I’m going through.”

Beginning his case anew in the district court with an even more secure legal footing, Brody will argue once again that New York’s notice is inadequate and violates due process. If he shows that Port Chester’s taking of his property for a Stop & Shop is not for a public use, as required by both the U.S. and New York constitutions, he may be entitled to get his property back and receive compensation for his losses.

Hard Work Yields 60 Minutes & A Public Opinion Victory

Four days after the Brody victory, the IJ headquarters staff gathered at my home to celebrate a victory of another kind, this one in the court of public opinion. Mike Wallace, the legendary host of 60 Minutes, and seasoned producer Bob Anderson, who has been with the network for 25 years, created a landmark feature on eminent domain abuse for the program’s 35th season premier.

We knew the segment would showcase the stories of IJ clients Jim and JoAnn Saleet, homeowners from Lakewood, Ohio, and brake shop owner Randy Bailey, from Mesa, Ariz., as well as comments by IJ Senior Attorneys Dana Berliner and Scott Bullock, but we had no control over what the program’s take would be. Would they trumpet the development or the plight of the homeowners? We had provided them with the basic information, but what they did with it from there was entirely their call. Lakewood had declared the Saleets’ property “blighted” with the goal of moving them out and replacing their home (as well as 54 other homes, four apartment buildings and a dozen small businesses) with privately owned upscale condos and high-end retail shops. Similarly, the City of Mesa wanted Bailey to move so it could give his property to a politically connected Ace Hardware store.

Wallace confronted Lakewood Mayor Madeline Cain on the City’s bogus blight declaration and the fact that, under the City’s definition, her home and the home of every City Council member would also be “blighted.”

Excerpt from transcript:

Wallace: My understanding is that using the criteria that are in place, more than 90 percent of the houses in Lakewood could be deemed blighted, including the houses of the mayor and of every one of the city council members. True? Do you have two bathrooms?Mayor Cain: No.Wallace: Blight. Two-car garage?Mayor Cain: No.Wallace: Blight. Is the garage attached?Mayor Cain: No.Wallace: Blight. And your lot size; is it under 5,000 square feet?Mayor Cain: Oh, well under.

The response to the piece was striking. Immediately following the program, the Saleets’ and Bailey’s phones rang steadily for four straight hours and continued for many more days with calls coming in from all over North America from people offering help and wishing them well. IJ, too, was swamped with encouraging emails and phone calls. And, as the East Valley Tribune in Mesa noted, “Mesa Mayor Keno Hawker came out as a champion for Bailey, even though the mayor had voted in favor of the redevelopment project that would force Bailey to move. The mayor said he’s on Bailey’s side, and it’s not the proper role of government to take private property from one individual and give it to another. ‘I certainly can relate to Bailey,’ Hawker said. ‘He shouldn’t have to sell if he doesn’t want to.’” The newspaper reported that Hawker had cast three separate votes over a little more than a year that would have forced the transfer of Bailey’s land to the hardware store. The 60 Minutes coup was by no means a spontaneous stroke of luck; it took years of careful planning and persistence. Three years before the piece ever aired, Dana, IJ President Chip Mellor and I formulated a specific plan to elevate the issue to a national level deserving of national media attention. The foundation of our work would be the first-ever national survey documenting how common this abuse of governmental power had become. Dana and then-clerk Rob Wiles (who now serves as IJ’s Castle Coalition coordinator) went to work over a two-year period tracking down every public record in every state that discussed eminent domain abuse. The result of their research was a massive-but-accessible report, Public Power, Private Gain. The report showed that the more than 10,000 examples of eminent domain abuse were not a local story; they were a national one. Months before publication, we began contacting 60 Minutes correspondents and producers, all to no avail. Although each of them agreed the story was an outrage, they either didn’t see it as a piece for them or they didn’t feel they could sell it to their executives in New York. Frustrated by their inability to commit to the story, we asked one long-time CBS correspondent, “Isn’t there any way to ask [60 Minutes creator and executive producer] Don Hewitt to create this feature?” The response was immediate and certain: “No one talks to Don Hewitt.”

That settled it for me; we’d make a Hewitt pitch.

I tracked down his direct dial number and his secretary was gracious enough to pass along my message. Mr. Hewitt returned my call in a matter of minutes.

I explained, “I know it is very unusual for you to take pitches on stories, but I have a story for you that is a natural for 60 Minutes and I was wondering if I could share it with you in 30 seconds.”

He agreed and 30 seconds later, after I explained how homeowners and small businesses were being forced off of their property to make way for politically connected developers to put up private malls and condos, he gave me his address and asked me to send him more information. Dana’s yet-to-be-published report was Federal Expressed to him overnight and before the middle of the next week, Dana, Scott and I were sitting across the table at IJ with producer Anderson. The rest, as they say, is history.

But not quite, because more good news was still to come.

Three days after 60 Minutes aired, the Arizona Court of Appeals handed down a unanimous constitutional victory for Randy Bailey, giving IJ its second major legal victory for property rights in a week. After years of nonstop anxiety about whether the City would succeed in seizing his property and handing it over (along with a $2 million taxpayer subsidy) to a private business, Arizona brake shop owner Randy Bailey finally won the legal victory he had long sought.The court wrote, “The constitutional requirement of ‘public use’ is only satisfied when the public benefits and characteristics of the intended use substantially predominate over the private nature of that use.” Transferring private property to a developer to build a hardware store and other businesses did not satisfy that standard.

IJ co-founder and Vice President Clint Bolick, the lead attorney on the Bailey case, told the media, “The dogs have been called off. Randy can now hang onto the business that is rightfully his.”

In October, the Mesa City Council voted unanimously not to appeal the decision.

IJ’s efforts in Lakewood, Mesa and elsewhere are part of our nationwide program to restore the protection of private property rights. Among the other property cases we continue to litigate are those in Norwood, Ohio, and New London, Conn. In Norwood, as featured here in this newsletter, IJ filed suit in late September on behalf of homeowners and small businesses challenging that City’s effort to take their homes so it may give the land to the Cincinnati-based developer Jeffrey R. Anderson Real Estate—the same developer as the Lakewood project. In New London, Conn., IJ awaits the decision of the Connecticut Supreme Court in a lawsuit that will determine whether a private development corporation may take homes, raze them, then hand over the land to a private corporation for its use. When some of those properties were taken, the developer had no specific plan for them, leading many to ask, “How can the government argue it is taking these properties for a public use, when it doesn’t know what it wants to do with the land?”

With these current battles and victories already won in Canton, Miss., Atlantic City, Pittsburgh and Baltimore, IJ is working to turn the tide against eminent domain abuse. Development will happen, but it will take place as it was meant to—through private negotiation rather than by government force.

John E. Kramer is IJ’s vice president for communications.