Seventy homeowners and businesses sued the Sewerage and Water Board of New Orleans (SWB), claiming that their flood-control project led to millions of dollars in damage to their nearby structures—with issues ranging from shifting porches to cracked sidewalls and everything in between. From 2018 through 2020, the state court ruled that this damage amounted to takings or property that merit just compensation under the Fifth Amendment, and awarded plaintiffs a number of separate compensation packages, totaling more than $10 million.

The SWB has refused to pay, and has no intention of paying, despite easily having the means to do so (for example, assets exceeding $3 billion). That led to an enforcement suit in federal court.

The SWB’s position is that the landowners have no right to compel execution of the judgments in their favor. Remarkably, the district court held that there’s no federal cause of action to compel a political subdivision of a state to pay just compensation awards.

And yet, just two years ago, Knick v. Township of Scott, the Supreme Court held, among other things, that takings claimants do not have to exhaust their state-level options before suing in federal court. For instance, they may sue under 42 U.S.C. §1983—the more or less catchall federal civil-rights law. The question now is whether Knick’s landmark ruling extends to owners who have already won their takings lawsuit in state court, but who cannot collect because, as SWB argues here, state law prevents the seizure of the losing side’s assets to satisfy the judgment against them.

Cato has now joined the Southeastern Legal Foundation and Pelican Institute on an amicus brief urging the U.S. Court of Appeals for the Fifth Circuit to follow the Supreme Court’s lead and confirm owners can pursue § 1983 claims in federal court to compel state or local governments to pay what they owe. Indeed, even Williamson County v. Hamilton Bank, a decades-old case Knick partly overturned, agreed that federal relief was available where a state’s legal system made it all but impossible to recover just compensation.

This isn’t even the first time that legal shenanigans in Louisiana have prevented winning claimants from collecting their just compensation. At oral arguments in a 2020 case in which Cato was also involved, Violet Dock Port v. Heaphy, a panel of Fifth Circuit judges cut to the chase: “When is your client going to pay?” “You’ve got the money. Pay up. This is really ludicrous.”

It truly is—and for property owners, the stakes could not be higher. If Knick is not read to permit them to sue in federal court to recover judgments finalized in state court, violators will continue to hide behind dubious state laws to avoid collection. The federal judiciary must enforce federal laws that provide clear remedies for clear constitutional violations. That’s the only way to ensure that the Just Compensation Clause does not become a dead letter in the face of bogus administrative obstacles.

The Fifth Circuit will hear Ariyan, Inc. v. Sewerage & Water Board of New Orleans this fall.