Updates to our Terms of Use

We are updating our Terms of Use. Please carefully review the updated Terms before proceeding to our website.

Monday, July 15, 2024 | Back issues
Courthouse News Service Courthouse News Service

Helicopter Tour Company Loses FAA Takings Claim

(CN) - The U.S. government is not responsible after a helicopter tour company in Guam shut down when it received an unauthorized cease-and-desist order from the Federal Aviation Administration, the Court of Federal Claims ruled.

Anyone dealing with a government agent takes a risk that the agent may not actually have the authorization to do or say what he claims, according to the ruling.

Judge Eric G. Bruggink wrote that the "the issue appears to be novel," and rejected Americopters' eight-year-old claim that it is owed compensation under the Fifth Amendment.

Americopters had moved its operations from the rooftop of Chuck's Steak House in Guam in 2002 after receiving a letter from FAA inspector Clarence Kanae that described various safety issues at the steak house base. Kanae's supervisor, Don Hamilton, edited and approved the letter, which ordered Americoperts to "immediately cease use of the Chuck's Steak House rooftop for all flight operations," according to the ruling.

Americopters said it closed months later because its new location chose was not as commercially viable, and it sued the government in 2003, alleging that the order amounted to the taking of its property under the 5th Amendment.

Bruggink wrote that the FAA took "inconsistent positions regarding the finality of the order at issue" over the next several years, and Americopters' case bounced around what the 9th Circuit called a "procedural limbo or netherworld."

Finally, in March, the government moved for summary judgment, arguing that Kanae's shutdown order was unauthorized and thus could not form the basis for a takings claim. Americopters cross-moved.

Bruggink sided with the FAA, finding that "there is no dispute that, under the FAA's enforcement scheme and organizational hierarchy, neither Mr. Kanae nor Mr. Hamilton had the authority to issue cease-and desist-orders."

Bruggink defined the primary question in the case as "whether or not the act causing the taking was within the authority granted the agency by Congress."

"Although it is clear that in contract law the government is not bound by the promises or representations of an individual government employee who is not authorized to make such promises, neither this court nor the Federal Circuit has directly addressed whether this rule should apply to takings cases," according to the ruling.

There are FAA employees that are authorized to regulate or suspend flight operations, but only certain FAA lawyers would have had the authority to shut down Americopters under FAA guidelines, according to the ruling.

"Here, plaintiff has not persuaded us that different considerations should apply in the context of takings," Bruggink wrote. "In takings, as in contracts, a necessary prerequisite is that the government itself has acted. When a federal official 'assumes to act by virtue alone of his office, and without the authority of Congress,' his acts do not, 'in any legal or constitutional sense, represent the United States, and what he does or omits to do, without the authority of the Congress, cannot create a claim against the government, 'founded upon the Constitution.'"

Bruggink granted summary judgment to the FAA and denied Americopters' cross-motion.

Bruggink added that "a different result, of course, would open the Treasury to takings claims in which the government, qua government, had no intention to act, much less to take property."

Categories / Uncategorized

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.