Lingle v. Chevron U. S. A. Inc., 544 U.S. 528 (2005)
Primary Holding
The "substantially advances" formula established in Agins v. City of Tiburon is not an appropriate test for determining whether government regulation effects a taking under the Fifth Amendment.
In the case of Lingle v. Chevron, the Supreme Court decided that a specific test used to determine if government regulations unfairly take private property rights is not valid. This matters because it means states can create laws, like rent caps for gas stations, without automatically being accused of taking property without compensation. This case is relevant for consumers because it helps ensure that regulations aimed at controlling prices and protecting consumers can be upheld, even if businesses challenge them.
AI-generated plain-language summary to help you understand this case
In Lingle v. Chevron U.S.A. Inc., the underlying dispute arose from a Hawaii statute, Act 257, enacted in June 1997, which aimed to regulate the rent that oil companies could charge independent dealers leasing service stations. The law was a response to concerns regarding the high concentration of the gasoline market in Hawaii, where Chevron was the dominant player, controlling 60% of the in-state market. Act 257 imposed a cap on the rent that oil companies could charge their lessee-dealers, which Chevron argued constituted an uncompensated taking of private property under the Fifth and Fourteenth Amendments. The lower courts ruled in favor of Chevron, applying the "substantially advances" formula from previous case law to determine that the rent cap did not adequately advance Hawaii's interest in controlling gasoline prices. The procedural history of the case began when Chevron challenged the constitutionality of Act 257, leading to a series of legal proceedings that culminated in the Ninth Circuit Court of Appeals. The appellate court upheld the lower court's decision, agreeing that the statute resulted in a taking of property without just compensation. This decision prompted the State of Hawaii, represented by Governor Linda Lingle, to seek a writ of certiorari from the Supreme Court of the United States to review the case. The relevant background context includes Hawaii's unique geographical and economic situation, characterized by a small population and a highly concentrated oil market, with only two refineries and six wholesalers operating in the state at the time of the lawsuit. Chevron's business model involved leasing service stations to independent dealers under specific contractual terms, including a rent structure based on a percentage of sales. The case raised significant questions about the balance between state regulation and private property rights, particularly in the context of the Fifth Amendment's takings clause and the implications of government intervention in a concentrated market.
Whether the "substantially advances" formula announced in Agins v. City of Tiburon is an appropriate test for determining whether a regulation effects a Fifth Amendment taking.
The judgment of the Ninth Circuit is reversed and the case is remanded for further proceedings consistent with this opinion.
- Court
- Supreme Court
- Decision Date
- February 22, 2005
- Jurisdiction
- federal
- Case Type
- landmark
- Damages Awarded
- N/A
- Data Quality
- high
San Remo Hotel, L. P. v. City and County of San Francisco, 545 U.S. 323 (2005)
Consumer LostFederal courts cannot create an exception to the full faith and credit statute, 28 U.S.C. §1738, for claims brought under the Takings Clause of the Fifth Amendment, thereby affirming that state court decisions on takings claims must be respected in federal court.
Exxon Mobil Corp. v. Allapattah Services, Inc., 545 U.S. 546 (2005)
Consumer LostA federal court in a diversity action may exercise supplemental jurisdiction over additional plaintiffs whose claims do not meet the minimum amount-in-controversy requirement, as long as at least one named plaintiff satisfies that requirement and the claims are part of the same case or controversy.
National Cable & Telecommunications Ass'n v. Brand X Internet Services, 545 U.S. 967 (2005)
Consumer LostThe Federal Communications Commission's determination that cable companies providing broadband Internet service do not qualify as "telecommunications services" under Title II of the Communications Act, and thus are exempt from mandatory common-carrier regulation, is a lawful construction of the Act under the Chevron deference standard.
Orff v. United States, 545 U.S. 596 (2005)
Consumer LostCongress did not waive the United States' sovereign immunity for suits brought by third-party beneficiaries under the Reclamation Reform Act of 1982, and therefore, individuals who are not parties to a government contract cannot sue the United States for breach of that contract.