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Pretextual Takings: Of Private Developers, Local Governments, and Impermissible Favoritism

Daniel B. Kelly

Notre Dame Law School

Supreme Court Economic Review, Forthcoming

Since Kelo v. City of New London, the preferred litigation strategy for challenging a condemnation that benefits a private party is to allege that the taking is "pretextual." This Article contends that, although pretextual takings are socially undesirable, the current judicial test for identifying such takings is problematic. Yet an alternative, intent-based test might be impracticable, as well as underinclusive: condemnors often have mixed motives, particularly when confronted with a firm's credible threat to relocate. Instead, the Article develops a framework that emphasizes informational differences between local governments and private developers. When the government lacks information regarding the optimal site for an assembly, the government may need to rely on a private party to identify, as well as develop, a particular site. However, when the government itself possesses information regarding the site, pre-condemnation private involvement, as well as post-condemnation involvement by a preferred developer, is generally unnecessary. Such involvement increases the likelihood of a pretextual transfer without any corresponding public benefit. The Article concludes that a burden-shifting framework, analogous to Title VII's test for identifying pretext, can be adopted in the takings context. The new framework is then applied to several situations in which allegations of pretext are likely to arise.

Number of Pages in PDF File: 49

Keywords: pretext, takings, eminent domain, condemnation, assembly, developers, local government, Kelo, public use, Title VII

JEL Classification: K11

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Date posted: May 15, 2008 ; Last revised: September 3, 2010

Suggested Citation

Kelly, Daniel B., Pretextual Takings: Of Private Developers, Local Governments, and Impermissible Favoritism. Supreme Court Economic Review, Forthcoming. Available at SSRN: http://ssrn.com/abstract=1132429 or http://dx.doi.org/10.2139/ssrn.1132429

Contact Information

Daniel B. Kelly (Contact Author)
Notre Dame Law School ( email )
P.O. Box 780
Notre Dame, IN 46556-0780
United States
574-631-7690 (Phone)
574-631-8078 (Fax)
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