It is not just the U.S. Constitution, however, that bars the seizure of “private property” for “public use” without “just compensation.” Because most state constitutions contain the same provision, a property owner must “exhaust” his rights under his state constitution before proceeding to federal court. When he does, the U.S. Supreme Court declared in 1964, he “is in no event to be denied his right to return to the [federal] District Court” if he reserves his federal claims and refrains from litigating them in state court. That is what Seven Up Pete did; hence, its path to the Supreme Court to reverse the Ninth Circuit’s ruling seems clear.
Unfortunately, in 2005, in a trio of cases, which included the infamous Kelo ruling, the Supreme Court weakened the constitutional protections afforded property owners. In one, the Court purportedly reversed the 30-year-old precedent upon which Seven Up Pete relied. In the future, ruled the Court, if a state court decides a claim that is “functionally identical” to the reserved federal claims, the state court holding must be given preclusive effect. Although the Ninth Circuit did not base its ruling on this recent decision, Montana will certainly rely on it when Montana opposes Seven Up Pete’s petition for Supreme Court review.
Seven Up Pete’s petition must be heard; otherwise, state courts with a myopic view of the Takings Clause will eviscerate, not only state constitutional property rights guarantees, but also those in the United States Constitution!