The Supreme Court's 2019 decision overruling Williamson County's state-litigation requirement opened federal court to takings claims — but the surviving finality requirement, residual res judicata risks, and forum-selection strategy demand careful navigation.
I. The Pre-Knick Trap
For thirty-four years, Williamson County Regional Planning Commission v. Hamilton Bank of Johnson City, 473 U.S. 172 (1985), erected what amounted to an impenetrable procedural barrier to federal takings litigation against state and local governments. Williamson County established two requirements before a plaintiff's takings claim was "ripe" for federal adjudication: first, a "final decision" from the relevant government entity regarding the application of the challenged regulation to the property; and second, exhaustion of whatever compensation procedures the state had provided.
The second requirement — the state-litigation prong — became the trap's teeth. Because inverse condemnation proceedings are the standard state compensation mechanism, property owners were required to sue in state court first. But when they did and lost, 28 U.S.C. § 1738's full-faith-and-credit obligation required federal courts to give preclusive effect to the state judgment. San Remo Hotel, L.P. v. City and County of San Francisco, 545 U.S. 323 (2005), confirmed this preclusion result: federal courts would not craft an exception to § 1738 for takings claims. The outcome was a constitutional hall of mirrors — the plaintiff had to go to state court first to ripen the federal claim, but the state court's adverse judgment then barred the federal claim that the state litigation was supposed to ripen. The San Remo "preclusion trap" effectively eliminated meaningful federal review of most regulatory takings cases.
II. Knick v. Township of Scott — Overruling the State-Litigation Prong
Knick v. Township of Scott, 588 U.S. 180 (2019) presented facts tailor-made for overruling Williamson County. A Pennsylvania Township adopted an ordinance requiring property owners to allow public access to private cemeteries. Rose Mary Knick owned a farm with a small family cemetery on it; the ordinance gave township officials the right to enter her property to confirm compliance. Knick filed a § 1983 action in federal court alleging an unconstitutional taking. The district court dismissed for failure to satisfy Williamson County's state-litigation requirement.
The Supreme Court, in a 5-4 opinion by Chief Justice Roberts, overruled Williamson County's state-litigation requirement. The majority's core reasoning was textual and structural: the Fifth Amendment's Takings Clause is self-executing. A property owner suffers a constitutional violation at the moment the government takes property without paying just compensation — not at the moment a state court denies compensation. The constitutional violation is the taking without payment, not the failure to compensate at the end of the process. As the Court put it, with an analogy that has become famous: "A bank robber might give the loot back, but he still robbed the bank."
The majority emphasized that § 1983 provides the cause of action for constitutional violations by state officials, and that § 1983's text does not require exhaustion of state remedies as a condition precedent to suit. Williamson County's state-litigation requirement had effectively imposed an exhaustion requirement that § 1983 does not authorize.
III. What Knick Did Not Do
The Court's opinion was careful to cabin its holding:
The finality requirement survives. Chief Justice Roberts explicitly stated that Knick does not overrule Williamson County's first prong — the requirement that the government entity must have reached a "final decision" regarding the application of the regulation to the property at issue before a takings claim is ripe. This prong is alive and requires careful strategic management (addressed in Post 115 of this series).
No injunctive override of government regulation. The majority noted that Knick should not be read as a vehicle for enjoining government action. Because monetary compensation is the remedy for a taking, injunctive relief is generally inappropriate. The availability of just compensation is the constitutional remedy.
State court forum remains available. Nothing in Knick prevents a property owner from choosing to litigate an inverse condemnation claim in state court. The decision expands forum choice; it does not dictate federal litigation.
IV. Forum Strategy After Knick
The opening of the federal forum creates strategic choices that did not exist before June 2019. The analysis is not simply "federal courts are better for plaintiffs." The calculus is more nuanced.
A. Advantages of the Federal Forum
Federal court neutrality. State courts in regulatory land use disputes may be subject to institutional and political pressures favoring local government defendants. Federal courts with lifetime-tenured judges are more insulated from those pressures. For high-profile cases involving local government overreach — and for cases where the local sovereign is also the state — federal court neutrality is a meaningful consideration.
§ 1983 procedural advantages. A 42 U.S.C. § 1983 action in federal court benefits from federal discovery rules, including liberal pleading under Twombly/Iqbal, robust Fed. R. Civ. P. 26 disclosure obligations, and access to the full range of federal equitable relief. Attorney's fees under 42 U.S.C. § 1988 are available to prevailing plaintiffs, which is a significant practical consideration in inverse condemnation cases where the compensation award may be substantial but not enough to justify contingency-fee representation.
Avoiding state law idiosyncrasies. State inverse condemnation doctrines vary significantly. Some states have construed their just compensation provisions more narrowly than the federal Takings Clause; others have developed unfavorable precedent on what constitutes a "taking" that does not exist in the federal framework. A plaintiff whose claim is more viable under the federal Takings Clause than under state inverse condemnation doctrine now has a direct path to federal court.
B. Residual Res Judicata Risks
Knick eliminated the preclusion trap prospectively — a plaintiff who files in federal court first under § 1983 is not required to first litigate in state court, so there is no state judgment to give preclusive effect. But the trap does not fully disappear.
A property owner who chose (or was forced, in pre-Knick cases) to litigate in state court first still faces issue preclusion in federal court, because Knick did not overturn San Remo Hotel's holding that § 1738 requires full faith and credit in takings cases. Post-Knick, the preclusion problem arises only in cases where the plaintiff independently chose to litigate state claims first, not as a constitutional prerequisite. But in practice, many property owners pursued state remedies before Knick's 2019 decision, and their federal claims may now be precluded by adverse state judgments.
Practice implication: In any takings case where the client has a prior adverse state court judgment, conduct a careful preclusion analysis before filing federally. Identify whether the state court addressed federal constitutional issues, whether those issues were actually and necessarily decided, and whether San Remo's force is diminished by any state-specific preclusion doctrines that might allow relitigation.
V. The San Remo Problem in Ongoing Cases
San Remo Hotel has not been overruled. The full-faith-and-credit statute, 28 U.S.C. § 1738, continues to require federal courts to give preclusive effect to final state court judgments. This means that a property owner who, after Knick, elects to pursue a state court inverse condemnation action — voluntarily, not compulsorily — and loses, is barred from federal relitigation of identical issues.
The strategic implication is that state court litigation should be pursued only where: (1) state inverse condemnation doctrine is more favorable than federal takings doctrine; (2) state court procedures offer superior discovery or trial advantages; or (3) the applicable statute of limitations requires state court filing. In all other circumstances, post-Knick property owners should file federally under § 1983 before any state court proceedings to preserve the federal forum and avoid the San Remo preclusion trap.
VI. Statute of Limitations Considerations
Federal § 1983 claims borrow the state's personal injury statute of limitations. In Alabama, that is two years under Ala. Code § 6-2-38; in Florida, four years under Fla. Stat. § 95.11(3)(p). The accrual date matters: under Knick, the federal claim accrues when the government takes property without paying just compensation — at the moment of the taking, not at the conclusion of state compensation proceedings. Plaintiffs who delayed filing in reliance on Williamson County's requirement to exhaust state proceedings may face limitations arguments if they then attempt to return to federal court. Courts have addressed these transitional Knick cases unevenly; the better practice is to file in federal court as soon as the final decision requirement is satisfied.
VII. Practice Notes
File in federal court as the first-filed action. For any regulatory takings claim against a state or local government arising after June 21, 2019, file a § 1983 action in federal district court as the primary litigation vehicle, after obtaining a final government decision on the property's regulatory status. This preserves the federal forum and avoids the San Remo preclusion trap.
Plead the taking precisely. Federal courts have interpreted the finality requirement with some variation. Plead the specific regulation, the specific decision applying it to the plaintiff's property, and the specific property right alleged to have been taken. Vague "regulatory overreach" pleadings invite Rule 12(b)(6) dismissal on finality grounds.
Address physical versus regulatory takings separately. Knick involved a physical access ordinance. For regulatory takings under Penn Central Transportation Co. v. City of New York, 438 U.S. 104 (1978), the factual record supporting the taking claim — economic impact, investment-backed expectations, character of government action — should be developed through discovery before trial. Physical taking claims may be stronger at the pleading stage.
Talk to Yates Anderson
If you are litigating a matter in this area — or weighing whether to — the working analysis above only goes so far. Request a case evaluation and a Yates Anderson attorney will respond within one business day.
Informational only. Not legal advice. No attorney-client relationship is created by reading this post. Consult a licensed attorney in your jurisdiction.