Daugherty Speedway, Inc. v. Holcomb, 520 F.Supp.3d 1070

Daugherty Speedway, a dirt racetrack in Benton County, Indiana, continued operations despite Governor Holcomb’s COVID-19 executive orders that closed nonessential businesses.
The Indiana State Department of Health issued a cease-and-desist letter; Benton County law enforcement blocked road access to the track for two evenings to prevent attendance.
Daugherty sued Benton County Commissioners and the Benton County Sheriff (individually and officially), alleging a Fifth Amendment takings claim under 42 U.S.C. § 1983 and various state-law claims; the Governor was voluntarily dismissed.
Daugherty sought damages and injunctive relief; defendants moved to dismiss for failure to state a claim.
The court held injunctive relief unavailable for a takings claim (Knick), and analyzed the asserted taking as a non-categorical regulatory taking under Penn Central.
Applying Penn Central, the court found minimal economic impact (two days of lost revenue), no demonstrated diminution in property value or frustrated investment-backed expectations, and that the character of the government action—temporary public-health measures—weighed heavily against a taking; federal takings claim dismissed with prejudice and state claims dismissed without prejudice for lack of supplemental jurisdiction.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Availability of injunctive relief for a Fifth Amendment taking	Sought injunction to stop enforcement and reopen track	Injunctive relief inappropriate for takings; remedy is compensation	Denied—injunctive relief dismissed (Knick: damages only)
Whether road blocking/enforcement was a physical taking	Enforcement physically prevented customers from accessing track	No physical invasion or appropriation of private property	Denied—no physical taking (no private-property invasion)
Whether closures/ enforcement constituted a regulatory taking under Penn Central	Executive orders deprived Daugherty of use/value (lost ~$50,000; business disruption)	Temporary, limited economic loss; no loss of property value; public-health regulation not a taking	Denied—regulatory taking not pleaded; Penn Central factors favor defendants
Whether federal court should retain state-law claims after dismissing federal claim	Impliedly sought to keep state claims in federal court	Court should decline supplemental jurisdiction once federal claims dismissed	Court declined supplemental jurisdiction; state claims dismissed without prejudice

Knick v. Township of Scott, Pennsylvania, 139 S. Ct. 2162 (2019) (takings remedy is compensation; injunction generally not available)
Lingle v. Chevron U.S.A. Inc., 544 U.S. 528 (2005) (distinguishes regulatory vs. physical takings; frames Penn Central inquiry)
Penn Central Transp. Co. v. New York City, 438 U.S. 104 (1978) (factors for non-categorical regulatory takings)
Williamson County Regional Planning Commission v. Hamilton Bank of Johnson City, 473 U.S. 172 (1985) (takings jurisprudence; ripeness principles)
Lucas v. South Carolina Coastal Council, 505 U.S. 1003 (1992) (categorical total takings rule)
Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419 (1982) (per se physical taking where government authorizes permanent physical occupation)
Connolly v. Pension Benefit Guaranty Corp., 475 U.S. 211 (1986) (government program adjusting benefits and burdens does not necessarily effect a taking)
Coll. Sav. Bank v. Fla. Prepaid Postsecondary Educ. Expense Bd., 527 U.S. 666 (1999) (distinguishing business goodwill/profits from property for takings purposes)
Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility standard for pleadings)
Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard; draw reasonable inferences in plaintiff’s favor)