Otay Mesa Property, L.P. v. United States, 779 F.3d 1315

Otay Mesa owns contiguous undeveloped parcels adjacent to the U.S.–Mexico border; five parcels contained 14 buried Border Patrol motion sensors placed between April 1999 and November 2005.
In 2008 the government stipulated it had taken a property interest—an easement—to install, operate, maintain, and replace those sensors, and listed installation dates for each sensor.
This Court previously held the sensor easement was a permanent blanket taking and remanded for damages (Otay Mesa I).
On remand the Court of Federal Claims subdivided the 897 acres into ~278 acres suitable for development and ~619 acres suitable for environmental mitigation.
The claims court denied damages for the development property (concluding no material effect) and awarded $455,520 (5% of value) for the mitigation property, with interest computed from August 28, 2008.
Parties appealed: Otay Mesa challenges the denial of development damages and the interest start date; the government cross-appeals the mitigation award amount.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Damages for development property	Otay Mesa: presented evidence (appraiser, survey, prior easement payments) showing a reasonable diminution (≈10%); court should award damages.	Government: plaintiff’s appraisal was unreliable; easement is minimally invasive and unilaterally terminable on 30 days, so no measurable loss.	Affirmed: trial court did not clearly err in crediting government evidence and denying damages for development property.
Damages for mitigation property (government cross-appeal)	Otay Mesa: easement poses a real risk to mitigation approval and reduces value (up to 40% per expert); court’s 5% award is supported by evidence.	Government: evidence showed no measurable impact on mitigation use; 5% award is unsupported and inconsistent with other findings.	Affirmed: trial court reasonably exercised discretion to adopt a middle-ground 5% award to compensate for risk to mitigation use.
Date interest accrues	Otay Mesa: interest should run from the dates sensors were first installed (as listed in the government’s stipulation).	Government & CFC: interest should run from disclosure/stipulation date (Aug. 28, 2008) because landowner lacked knowledge and prior damages were effectively zero.	Vacated-in-part and remanded: interest must run from the date of the taking (dates sensors were installed); CFC to recalculate interest.

Phelps v. United States, 274 U.S. 341 (Supreme Court 1927) (landowner entitled to interest from date of taking when payment is delayed)
Seaboard Air Line Ry. Co. v. United States, 261 U.S. 299 (Supreme Court 1923) (interest as component of just compensation)
Kirby Forest Indus., Inc. v. United States, 467 U.S. 1 (Supreme Court 1984) (owner entitled to interest to place them in same pecuniary position as if paid at taking)
United States v. Thayer-West Point Hotel Co., 329 U.S. 585 (Supreme Court 1947) (interest is part of just compensation)
Jacobs v. United States, 290 U.S. 13 (Supreme Court 1933) (just compensation includes interest where appropriate)
Otay Mesa Prop., L.P. v. United States, 670 F.3d 1358 (Fed. Cir. 2012) (earlier appeal: held sensor easement was a permanent taking and remanded for damages)
Precision Pine & Timber Inc. v. United States, 596 F.3d 817 (Fed. Cir. 2010) (landowner must prove actual damages with reasonable certainty; trial court has discretion to weigh valuations)
Ark. Game & Fish Comm’n v. United States, 736 F.3d 1364 (Fed. Cir. 2013) (standards for proving just compensation/damages)