According to the U.S. Supreme Court's 2005 ruling in Kelo v. New London, almost any commercial enterprise could be a "public use" justifying the forced transfer of property from one private owner to another. But state courts, where the battle over eminent domain is now shifting, do not necessarily agree.
In September, Maricopa County, Arizona, Superior Court Judge Kenneth Fields blocked a plan to seize land from 13 property owners for a shopping mall. Among other things, Fields noted that "the property will be used for private commercial use" and that "profit, not public improvement, is the motivating force for this redevelopment." His decision, based on a provision of the state constitution that says property "may not be taken for private use," cited a 2003 Arizona Court of Appeals ruling that prevented the city of Mesa from condemning a brake shop for the benefit of a hardware store.
Another state to watch is Ohio, where the Supreme Court agreed in October to hear an appeal by property owners fighting a redevelopment project in Norwood. The city declared their neighborhood "deteriorating" based on criteria such as small yards, dead-end streets, and multiple homeowners. Dana Berliner, the Institute for Justice attorney who represented the property owners in Kelo, notes that the Ohio Supreme Court has yet to accept the validity of the "deteriorating" rationale. So far in Ohio the use of eminent domain for private development has been approved only in neighborhoods considered "blighted."
In Michigan, meanwhile, the courts are still working out the implications of a 2004 decision in which the state Supreme Court overturned the 1981 ruling that permitted the obliteration of Detroit's Poletown neighborhood to make room for a G.M. plant. "Most states have not looked at eminent domain for private use in decades," Berliner says. "What's going to happen…is anybody's guess."?