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Lingle v. Chevron U.S.A. Inc.

Supreme Court of the United States

February 22, 2005, Argued ; May 23, 2005, Decided

No. 04-163.

Opinion

 [*531]  [**2077]  [***883]    JUSTICE O'CONNOR delivered the opinion of the Court.

On occasion, a would-be doctrinal rule or test finds its way into our case law through simple repetition of a phrase -- however fortuitously coined. A quarter century ago, in  Agins v. City of Tiburon, 447 U.S. 255, 65 L. Ed. 2d 106, 100 S. Ct. 2138 (1980), the Court declared that government regulation of private property "effects a taking if [such regulation] does not substantially advance legitimate state interests . . . ."  447 U.S., at 260, 65 L. Ed. 2d 106, 100 S. Ct. 2138. Through reiteration in a half dozen or so  [**2078] decisions since Agins, this  [*532]  language has been ensconced in our Fifth Amendment takings jurisprudence. See  Monterey v. Del Monte Dunes at Monterey, Ltd., 526 U.S. 687, 704, 143 L. Ed. 2d 882, 119 S. Ct. 1624 (1999) (citing cases).

In the case before us, the lower courts applied Agins'"substantially advances" formula to strike down a Hawaii statute that limits the rent that oil companies may charge to dealers who lease service stations [****8]  owned by the companies. The lower courts held that the rent cap effects an uncompensated taking of private  [***884]  property in violation of the Fifth and Fourteenth Amendments because it does not substantially advance Hawaii's asserted interest in controlling retail gasoline prices. This case requires us to decide whether the "substantially advances" formula announced in Agins is an appropriate test for determining whether a regulation effects a Fifth Amendment taking. We conclude that it is not.

The State of Hawaii, whose territory comprises an archipelago of 132 islands clustered in the midst of the Pacific Ocean, is located over 1,600 miles from the U.S. mainland and ranks among the least populous of the 50 States. Because of Hawaii's small size and geographic isolation, its wholesale market for oil products is highly concentrated. When this lawsuit began in 1997, only two refineries and six gasoline wholesalers were doing business in the State. As of that time, respondent Chevron U.S.A. Inc. was the largest refiner and marketer of gasoline in Hawaii: It controlled 60 percent of the market for gasoline produced or refined in-state and 30 percent of the wholesale market on the State's [****9]  most populous island, Oahu.

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544 U.S. 528 *; 125 S. Ct. 2074 **; 161 L. Ed. 2d 876 ***; 2005 U.S. LEXIS 4342 ****; 73 U.S.L.W. 4343; 35 ELR 20106; 18 Fla. L. Weekly Fed. S 303

Linda Lingle, Governor of Hawaii, et al., Petitioners v. Chevron U.S.A. Inc.

Notice:   [****1]   

Subsequent History: On remand at, Remanded by  Chevron United States v. Bronster, 415 F.3d 1027, 2005 U.S. App. LEXIS 14321 (9th Cir. Haw., July 15, 2005)

Prior History: ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT.

 Chevron USA, Inc. v. Lingle, 363 F.3d 846, 2004 U.S. App. LEXIS 6091 (9th Cir. Haw., 2004)

Disposition: Reversed and remanded.

CORE TERMS

rent, regulation, advances, stations, lessee-dealer, private property, cap, effects, formula, substantially advance, regulatory taking, oil company, exactions, gasoline, legitimate state interest, dealers, courts, retail, property right, due process, Fifth Amendment, wholesale, just compensation, summary judgment, gasoline price, public use, appropriation, government regulation, zoning ordinance, challenges

Energy & Utilities Law, Oil & Petroleum Products, Gasoline Fuels, Gasoline Dealers & Distributors, Communications Law, Overview & Legal Concepts, Ownership, General Overview, Oil, Gas & Mineral Interests, Utility Companies, Ownership & Restructuring, Constitutional Law, Bill of Rights, Fundamental Rights, Eminent Domain & Takings, Real Property Law, Inverse Condemnation, State Application, Regulatory Takings, Procedural Due Process, Scope of Protection, Remedies, Constitutional Issues