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What to Expect if Sued for Inverse Condemnation in Federal Court

July 18, 2022

Localities most often litigate both direct condemnation cases, in which the locality goes to court to force the sale of property, and inverse condemnation cases, where the property owner sues the locality for allegedly taking property without going through the formal procedures, in state court.  In fact, until recently, it was almost impossible to bring an inverse condemnation suit in federal court against a locality because of the practical impact of two Supreme Court rulings.  The first held that an owner’s inverse condemnation claim under federal law was not ripe unless and until the owner sued the locality responsible for the taking under state law in state court and failed to secure just compensation.  The other held that a state court’s resolution of a takings claim under state law would have preclusive effect on any takings claim under federal law.  Thus, the owner could not bring a claim under federal law until he had first sued in state court, and, once the owner sued in state court, the outcome of that trial would preclude a separate action in federal court.

The Court changed that in Knick v. Township of Scott, 139 S. Ct. 2162 (2019), holding that a takings claim under federal law is ripe without first submitting the claim to state court.  In the wake of that decision, localities may now find themselves in the unfamiliar situation of an inverse claim in federal court.  While claims under federal law litigated in federal court are similar in some respects to their Virginia counterparts, there are also meaningful differences.

Tougher Substantive Standard

Under both federal and Virginia law, a property owner bringing an inverse condemnation claim must identify some governmental actor that allegedly deprived the owner of his property.  In Virginia, that deprivation can occur as a result of an intentional governmental act, such as building a road over a property or intentionally releasing water from a dam and inundating private property downstream, or as a result of an intentional omission, such as a governmental actor purposefully designing public drainage infrastructure to be inadequate to handle expected levels of precipitation and thereby using private property to handle flooding from expected overflows from those systems.

Under federal law, by contrast, the deprivation must be the result of an overt governmental act.  A government’s failure to act—such as a lack of maintenance of public property leading to damage to private property or the inadequate drainage infrastructure discussed above—would not be sufficient to establish takings liability.  Such cases brought in federal court will be dismissed, and, if the owner also brings claims under state law in federal court, the state law claims will likely be dismissed without prejudice so that they can be refiled in state court.

More Rigorous Expert Witness Standards

Inverse condemnation cases typically require a good deal of expert testimony on both sides.  For example, in all but the most obvious of cases, an engineer will be required to establish that the government’s action caused the taking of the property at issue, and an appraiser will be needed to establish the value of the property taken.  In both state and federal courts, the opinions of such experts must be disclosed and must result from valid methodology.  However, the standards for both disclosure and methodology are more exacting in federal court than in Virginia state courts.

The disclosure standards in federal court require that experts retained for purposes of the litigation prepare a report that sets forth, among other things, a complete statement of all opinions to which the expert will testify, the basis and reasons for those opinions, and the facts or data considered by the witness in forming those opinions.  Those reports are meant to be so comprehensive that deposing the experts is unnecessary.  Under the Virginia standard, the facts and opinions to which the expert will testify must still be disclosed.  However, the parties are only required to provide a summary of the grounds for that testimony, rather than the more comprehensive disclosure required by the federal rules.  It is therefore often necessary to conduct depositions of experts to get a complete picture of their opinions and the basis, if any, for them. 

Perhaps the biggest difference between the federal and state systems is the review of the expert’s methodology.  In the federal system, an expert’s opinions must pass a threshold of reliability described in Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993), and its progeny.  Under the standard, the court is required to examine the methodology used by the expert to ensure that the opinions were derived using accepted and valid methods and that they are not the product of belief, speculation, or invalid inferences.

In Virginia courts, expert opinions must meet requirements, but the scrutiny applied is much less rigorous than in federal courts.  Like in federal court, the expert’s opinions cannot be based solely on speculation.  However, the inquiry into methodology is more limited.  It is thus more common to see experts whose opinions are not wholly supported by hard data, and efforts to exclude such opinions from evidence meet with more limited success.


Taken together, these differences, as well as the more structured litigation at the trial level in federal court, give localities some key advantages if they find themselves in federal court.  The attorneys at Pender & Coward have experience with defending inverse condemnation cases in both state and federal court and stand ready to help localities enjoy the benefits of those advantages.

Matt Hull is a Pender & Coward attorney focusing his practice on eminent domain, right of way, and uniform relocation act matters, local government, and waterfront property law.

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