In 2008, the city implemented a program called the Automated Traffic Enforcement System, which used mail to collect fines for traffic violations captured by street cameras. It was initially administered not by the New Orleans Police Department but by the city’s Department of Public Works. In 2010, a group of plaintiffs brought a class action challenging the program’s legality. Later that year, a state court preliminarily enjoined the program, determining that, under state law, the city likely had no authority to delegate enforcement authority to the DPW. In response, the city amended the program to transfer enforcement to the police department. Then, in 2018, the Louisiana trial court resolved that issue in favor of the plaintiffs, ordering the city to “immediately refund” the relevant fines and fees. The Court of Appeal affirmed, and the Louisiana Supreme Court denied cert.

The plaintiffs then brought the present action in the Eastern District of Louisiana alleging that the city had violated the Fifth and Fourteenth Amendments by confiscating their property and keeping it without just compensation.

The U.S. Fifth Circuit disagreed:

Takings are generally effected through the power of eminent domain. Though governments can effect regulatory takings through less ‘formal’ means, these plaintiffs do not bring a regulatory takings claim. Thus, in cases like this one, the government may not be required to compensate an owner for property which it has already lawfully acquired under the exercise of governmental authority other than the power of eminent domain.

“The plaintiffs’ taking theory suffers from a logical contradiction. They advance two propositions: The taking did not arise until the moment the McMahon judgment became final, and it arose only because the money was initially taken with no claim of right. Both contentions are necessary—to relitigate the initial extraction of fines under ATES would raise serious res judicata concerns, while fixating on the city’s failure to return the money would turn all money judgments against governments into takings. But in their attempt to avoid those pitfalls, the plaintiffs find themselves trying to have their cake and eat it too. They conceive of the city as “taking” their money in 2019, even when that money had been in the city’s possession since 2010 at the latest. And they insist that the city’s conduct from 2008 to 2010 was necessary to effect a taking that did not actually arise until 2019. Such a theory sits uneasily with a linear conception of time and is not rooted in the text of the Fifth Amendment….

“A judgment does not alter the fundamental nature of the interest it protects. Though the outcome of the McMahon litigation did not render the plaintiffs’ money immune to a takings claim, neither did it give rise to a takings claim that did not previously exist. That conclusion makes intuitive sense — as stated previously, it is odd to conceive of a government as instantly ‘taking’ property, especially property as fungible as money, that has been in its actual possession for years. And as the plaintiffs admitted at oral argument, their theory gives rise to no limiting principle — it would allow plaintiffs in a case like this to bring a federal takings claim the day after receiving a favorable judgment, even if the defendant were acting quickly and diligently to return the plaintiffs’ property.

“That conclusion defeats the plaintiffs’ theory that a taking arose when New Orleans failed to pay the McMahon judgment. The plaintiffs do not – and, for the reasons explained above, could not – argue that the extraction of fines under ATES was a taking. Thus, despite Vogt, they are left with no plausible allegation that the city has effected a taking of their property.”

 

Lafaye v. City of New Orleans, No.21-30358, 2022 WL 1764044 (5^th Cir. June 1, 2022).