Fairholme Funds, Inc. v. United States
132 Fed. Cl. 49
| Fed. Cl. | 2017Background
- Fairholme Funds takings litigation pending in the Court of Federal Claims; Federal Circuit affirmed denial of Michael Sammons’s motion to intervene.
- Sammons filed suit in the W.D. Tex. asserting a Fifth Amendment takings claim based on the Net Worth Sweep and sought $900,000.
- Magistrate Judge Chestney (W.D. Tex.) recommended dismissal, rejecting Sammons’s claim that the Tucker Act is unconstitutional as applied because only Article III courts may decide takings claims.
- District Judge Biery adopted the R. & R. and dismissed Sammons’s complaint for lack of jurisdiction; Sammons appealed to the Fifth Circuit.
- This Court (CFC) was directed by the Federal Circuit to consider whether the Court of Federal Claims (an Article I tribunal) may constitutionally adjudicate Fifth Amendment takings claims.
- Sammons moved for leave to file an amicus brief pressing the Article III/separation-of-powers argument; the CFC denied leave as unnecessary and unhelpful to resolution.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Tucker Act’s grant of exclusive forum to the Court of Federal Claims for takings claims violates Article III/separation of powers | Tucker Act unconstitutional as applied; Stern requires Article III courts to hear takings claims | Congress may attach forum conditions to its consent to be sued; public-rights doctrine and precedent permit non-Article III adjudication of government-vs-individual claims | CFC denied amicus leave; preliminarily concluded existing precedent supports Congress’s assignment of takings claims to the Court of Federal Claims and that Sammons’s argument is unpersuasive |
| Whether Stern v. Marshall compels invalidation of Court of Federal Claims jurisdiction over takings claims | Stern’s holding on limits of Article I courts applies broadly to invalidate Tucker Act forum allocation | Stern involved narrow bankruptcy/state-law private disputes; does not extend to government-vs-individual takings claims adjudicated under the Tucker Act | CFC: Stern is distinguishable; its narrow holdings do not control the Tucker Act context |
| Whether Sammons should be allowed to file an amicus brief in multiple takings cases | Sammons seeks to press his constitutional theory as an amicus because parties won’t raise it | United States opposes; parties and courts can address the issue; Sammons’s filings function as attempted intervention | CFC denied leave under its discretion: brief would not aid resolution, parties are capable, related appeals are pending |
| Whether Sammons’s parallel district-court suit affects CFC jurisdiction over future identical claims (Section 1500) | Sammons did not directly contest in this order but filed in district court asserting district jurisdiction | Government notes Section 1500 may bar CFC jurisdiction if duplicative suits are pending | CFC observed Section 1500 could deprive it of jurisdiction over identical claims and warned Sammons accordingly |
Key Cases Cited
- Stern v. Marshall, 564 U.S. 462 (2011) (limits on Article I tribunals entering final judgments on certain state-law counterclaims)
- N. Pipeline Const. Co. v. Marathon Pipe Line Co., 458 U.S. 50 (1982) (holding congressional grant of broad adjudicatory power to non-Article III bankruptcy tribunals raised Article III concerns)