RANCHO VISTA DEL MAR v. United States
CourtUnited States Court of Federal Claims
Date FiledJuly 30, 2026
Docket23-125
JudgeDavid A. Tapp
StatusPublished
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Full Opinion
In the United States Court of Federal Claims
No. 23-125
Filed: July 14, 2026
Reissued: July 30, 2026 †
RANCHO VISTA DEL MAR, et al.,
Plaintiffs,
v.
THE UNITED STATES,
Defendant.
Roger J. Marzulla, Nancie G. Marzulla, and Mollie A. Jackowski, Marzulla Law, LLC,
Washington, D.C., for Plaintiffs.
Kimberly A. Cullen, Trial Attorney, Young Kang, Trial Attorney, Erika Norman, Trial Attorney
Adam F. Gustafson, Principal Deputy Assistant Attorney General, Environment & Natural
Resources Division, U.S. Department of Justice, with Robert Walker, Raul Chiriboga, Thomas
Miller, Michael Felts, Christopher Shaw, Allan Thorson, Amy Dell, and Douglas OttenWess, Of
Counsel, U.S. Department of Homeland Security; also joined by Daniel Inkelas, Mary
Wrightson, Edmond C. Lambert, and Capt. Steven Foster, Of Counsel, U.S. Army Corps of
Engineers, Washington, D.C., for Defendant.
POST-TRIAL OPINION AND ORDER
TAPP, Judge.
This case involves a relationship born of necessity yet marked by longstanding
contention. Plaintiffs, a related group of property owners referred to singularly as “Rancho,”
return to court seeking redress for the United States Customs and Border Protection’s continued
use of their property. The first iteration of this litigation culminated in Otay Mesa Property L.P.
†
This Opinion was originally issued under seal, (ECF No. 181). The Court provided parties with
the opportunity to submit proposed redactions. The Court accepts all proposed redactions. (See
Joint Status Report, ECF No. 185). The sealed and public versions of this Opinion differ only to
the extent of those redactions, the publication date, and this footnote.
v. United States (Otay Mesa I), 86 Fed. Cl. 774, 775 (2009), aff’d, 670 F.3d 1358 (Fed. Cir.
2012). 1 This litigation is a continuation of that decision.
This case arises where land and law enforcement meet at the southern edge of the nation,
and where the effects of federal action are measured not in abstraction, but across real terrain
involving real people—landowners, many thousands of migrants, and those charged with
protecting our borders. According to Rancho, incomplete construction of the border wall, which
left a 700-foot gap between Rancho’s property and Tijuana, Mexico, increased federal law
enforcement presence on their property and transformed the nature of the property’s use. The
Court is tasked with determining whether that alleged transformation is borne out by evidence,
and whether it rises to the level of a Fifth Amendment taking. The evidence establishes that
Border Patrol’s installation and operation of sensors effected a taking. Yet Rancho chose to
litigate this case under a temporary takings theory and failed to present evidence permitting the
Court to determine just compensation under the facts proved. Put simply, the record establishes
liability but not the amount of compensation.
I. Procedural History
In its first Complaint, Rancho claimed that a gap in the border wall was responsible for
increasing the number of undocumented migrants traversing across their land and environmental
damage which resulted in a taking. (Compl. at 9–10, ECF No. 1). On the United States’ motion,
the Court partially dismissed Rancho’s takings claim based on unlawful migrant crossings. See
Rancho Vista Del Mar v. United States, 169 Fed. Cl. 299 (2024); (docketed at ECF No. 23). That
partial dismissal reiterated that takings liability must be premised on affirmative government
action rather than inaction and found that the Complaint failed to adequately plead such acts. Id.
at 304–05. In doing so, the Court foreclosed Rancho’s theory that the United States could be
liable for damages attributable to migrants illegally entering through the border gap. Id. at 305.
However, the Court permitted Rancho to amend its environmental impact and erosion claims to
better articulate causation, specify the impact on each parcel, and allege additional facts
sufficient to plausibly establish a takings theory based on government action. Id. at 306.
Given the Court’s instructions, Rancho filed an Amended Complaint alleging that the
United States Border Patrol’s (“Border Patrol”) activities on its property were so extensive as to
affect a taking. (See Am. Compl., ECF No. 26). The Amended Complaint alleged that, following
implementation of the federal government’s “open-borders policy,” a substantial increase in
undocumented migrant crossings in the San Diego Sector led to heightened Border Patrol
activity on Rancho’s properties, including all-terrain vehicle (“ATV”) patrols, migrant
1
In Otay Mesa I, the Court dismissed Plaintiffs’ claims based on Border Patrol’s presence on the
property as time-barred. 86 Fed. Cl. at 788. On appeal, the Federal Circuit held that the United
States had effected a permanent easement by installing sensors throughout Rancho’s property
and was therefore liable for a taking on that basis. Otay Mesa Prop., L.P. v. United States, 670
F.3d 1358, 1365 (Fed. Cir. 2012).
2
apprehension and transportation operations, and the placement of tracking equipment. (Id. at 10–
11). According to Rancho, these activities caused extensive environmental damage to sensitive
land and wildlife habitat, interfered with Rancho’s right to exclude others, and effectively
resulted in the taking of an easement for ingress and egress across the subject properties. (Id. at
11).
Again, the United States moved to dismiss Rancho’s Amended Complaint. (Second Mot.
to Dismiss, ECF No. 32). The Court denied that Motion. See Rancho Vista Del Mar v. United
States, 173 Fed. Cl. 159 (2024) (docketed at ECF No. 37). Specifically, the Court found that
Rancho plausibly alleged that Border Patrol agents and equipment, including ATVs and mobile
surveillance towers, regularly entered and operated on Rancho’s property in connection with
federal border enforcement activities, causing damage to the land and interfering with Rancho’s
right to exclude others. Id. at 167. Additionally, the Court noted that whether these activities
were truly based on affirmative government action rather than governmental inaction was an
issue to be resolved later. Id. That sequence set the stage for trial.
II. Findings of Fact 2
A. The Property
The property is comprised of eight parcels collectively owned by Plaintiffs, Rancho Vista
Del Mar, Otay International, LLC, Otay Mesa Property, L.P., and D&D Landholdings (the
“Property”). (Amended Joint Stipulations of Facts (“Am. JSOF”) at ¶¶ 1–9, ECF No. 135). The
parcels are described as follows:
• Plaintiff Rancho Vista Del Mar owns Parcel Nos. 648-090-05 (approximately 496.56
acres) and 648-080-08 (approximately 40 acres). (Id. at ¶¶ 2–3).
• Plaintiff Otay International, LLC owns Parcel Nos. 648-090-01 (approximately 40 acres),
648-080-21 (approximately 40 acres), 648-080-22 (approximately 40 acres), and 648-
080-10 (approximately 40 acres). (Id. at ¶¶ 4–7);
• Plaintiff Otay Mesa Property L.P. owns Parcel No. 648-080-19 (approximately 74.55
acres). (Id. at ¶ 8)
• Plaintiff D&D Landholdings owns Parcel No. 648-080-26 (approximately 20 acres). (Id.
at ¶ 9).
Together, these parcels make up 791.11 acres of land adjacent to the southern border. (Id. at ¶¶
1–9).
2
To the extent they are relevant, the Court adopts the findings in prior and related opinions. A
comprehensive recitation of facts can be found in the Court’s Opinions regarding the United
States’ previous Motions to Dismiss. Rancho Vista Del Mar v. United States, 169 Fed. Cl. 299,
301 (2024); Rancho Vista Del Mar v. United States, 173 Fed. Cl. 159 (2024).
3
responsible for patrolling several Zones. (Tr. Woods, 269:21–270:16). Specifically, Rancho’s
property is located in the San Diego Sector, within Zones and of Chula Vista Station’s area
of responsibility. (Id., 239:25–240:7, 242:1–3; Am. JSOF at ¶¶ 27–29; Defendant’s Exhibit
(“DX”) 66).
Border Patrol uses jeeps, trucks, night-vision-scope trucks, vans, ATVs, shuttle buses,
minibuses, and foot patrols to apprehend individuals suspected of violating criminal or
immigration laws. (Am. JSOF at ¶ 30; Tr. Woods, 252:10–253:3). To further effectuate its
mission, Border Patrol also uses drones, portable flood lights, and hidden ground sensors to
. (Tr. Lopez, 183:23–25, 195:23–196:5; JX 32, 53, 30-0008; Tr. Woods, 265:9–
266:6).
C. Border Fence Construction
On February 15, 2019, the President of the United States issued Proclamation 9844,
declaring a national emergency concerning the southern border of the United States. (Am. JSOF
at ¶ 11). In early 2019, the United States purchased 17.04 acres from Rancho in anticipation of
future border fence construction projects, and as a result owned a 17.04-acre strip of land
between the southern border of Rancho’s property and the United States-Mexico border to
construct a border fence. 4 (Id. at ¶ 12). Acting under 10 U.S.C. § 2808, the Secretary of Defense
authorized eleven border fence projects, including the San Diego 4 Project. (Id. at ¶ 13). The San
Diego 4 Project involved construction of approximately 1.5 miles of primary steel fencing and 2
miles of secondary steel fencing near the Otay Mesa Port of Entry. (Id. at ¶ 14). This
construction required a continuous line of fencing along the southern border adjacent to
Rancho’s property. (Id.).
In early 2020, a contractor acting on behalf of Border Patrol contracted with Rancho to
use three acres of Rancho’s property for the staging and storage of construction materials in
exchange for monthly rent payments. (Am. JSOF at ¶¶ 15–16; JX 12). Construction began on the
segment of border fencing adjacent to the Property in March 2020. (Am. JSOF ¶ 19). A second
agreement between the contractor and Rancho permitted access to the border fence construction
site through the Property. (JX 13-0002, ¶¶ 2, 6–7). That second agreement also authorized the
contractor to utilize an access route on the Property known as the “Red Road” and permitted the
contractor to grade and use the road throughout construction. (Id.; see Am. JSOF at ¶ 18).
On the date of the presidential transition in 2021, the President of the United States
terminated Proclamation 9844. (Am. JSOF at ¶ 20). This termination eliminated funding for
border fencing projects and consequently immediately paused border wall construction including
the San Diego 4 Project. (Id. at ¶¶ 21–24). The pause in construction left an approximately 700-
foot gap in the primary and secondary steel fencing immediately south of Rancho’s property. (Id.
4
As a result of the United States’ acquisition of this property, Rancho no longer owns land
extending to the southern border. (JX 47-0005; Tr. Enriquez, 514:3–7, 521:7–12, 521:14–522:3).
Rather, the United States now owns all land from the international boundary line to
approximately 30 feet north of the secondary barrier. (Id.).
5
Agency, 535 U.S. 302, 322 (2002) (citing United States v. Pewee Coal Co., 341 U.S. 114, 115
(1951)).
The Court applies a two-part analysis to assess the validity of physical takings claims,
determining: (1) whether the claimant has identified a “cognizable Fifth Amendment property
interest[,]” and (2) whether that property interest was “taken.” Acceptance Ins. Cos., Inc. v.
United States, 583 F.3d 849, 854 (Fed. Cir. 2009) (citations omitted). The Court will not proceed
to the second step “without first identifying a cognizable property interest.” Id. (quoting Air
Pegasus of D.C., Inc. v. United States, 424 F.3d 1206, 1213 (Fed. Cir. 2005)). A cognizable
property interest is typically indicated by the ability to sell, assign, transfer, or exclude. Hearts
Bluff Game Ranch, Inc. v. United States, 669 F.3d 1326, 1330 (Fed. Cir. 2012). Rancho’s
ownership of the properties is undisputed. (Am. JSOF at ⁋⁋ 1–9). Therefore, the Court
determines if Rancho’s property was “taken.” Hearts Bluff Game Ranch, Inc., 669 F.3d at 1329
(internal quotations omitted).
A physical taking arises when government action results in a physical invasion or
occupation of private property, effectively serving as the functional equivalent of a "practical
ouster of [the owner’s] possession." Transportation Co. v. Chicago, 99 U.S. 635, 642 (1878);
Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419 (1982). Liability is established
when a taking occurs, and the private party remains uncompensated. See First English
Evangelical Lutheran Church of Glendale v. County of Los Angeles, 482 U.S. 304, 315 (1987)
(finding that the Takings Clause “is designed not to limit the governmental interference with
property rights per se, but rather to secure compensation in the event of otherwise proper
interference amounting to a taking.”). Once a property owner experiences a physical intrusion,
the government must provide just compensation, regardless of how minor the disruption is or
how compelling the public interest might be. Lucas v. South Carolina Coastal Council, 505 U.S.
1003, 1015 (1992).
B. Rancho's taking claim arises from the installation of new sensors, rather than
from an increase in Border Patrol activity.
To demonstrate liability, Rancho needed convincing evidence that the actions of the
Border Patrol increased to such a degree that it affected a taking. Rancho’s claims are premised
on a pause in construction of the border fence which resulted in a 700-foot gap from 2021 to
2025. (Tr. Pls.’ Counsel, 13:8–17). The parties agree that at most the taking is temporary. (See
Tr. Pls.’ Counsel, 17:11–14 (“[The] United States has effected a temporary taking of a use
easement[.]”); Def.’s Counsel, 18:21–24 (“[B]ecause the gap closed . . . any claim for a taking is
temporary.”)).
Rancho’s taking claim must be based on government action, not that of migrants. Rancho
Vista Del Mar, 173 Fed. Cl. at 166 (citing St. Bernard Parish Gov’t v. United States, 887 F.3d
1354, 1362 (Fed. Cir. 2018)). Specifically, a plaintiff must “show that in the ordinary course of
events, absent government action, [they] would not have suffered the injury.” St. Bernard Parish,
887 F.3d at 1362–63 (also observing that the question the Court must decide is whether “the []
damage that actually occurred” was worse than “the [] damage that would have occurred if there
had been no government action at all”). In this case, the question is whether construction of the
700-foot gap placed Rancho in a worse position than would have existed under the prior, wider
8
gap in the border wall. See id. Because Rancho’s taking claims are premised entirely on the
increase in enforcement activity resulting from the construction of the 700-foot-wide gap, they
bear the burden of proving that such an increase in activity occurred. (Am. Compl. at 1). 9
Here, Rancho’s theory that construction of the 700-foot gap increased Border Patrol’s
operations to such a degree that it affected a temporary taking is belied by the evidence. Rancho
relies primarily on apprehension data. (JX 52-0001). But, as discussed above, apprehension
figures provide little insight into the number of Border Patrol agents involved in any given
response. Indeed, senior Border Patrol personnel convincingly testified that apprehension data
cannot be used to determine how many agents responded to a particular incident. (Tr. Woods,
249:2–5 (“The [apprehension] numbers don’t necessarily dictate the amount of Border Patrol
agents that would respond to the individuals entering the United States.”); Tr. Larimore, 468:8–
11 (“[I]t would be impossible to infer . . . how many agents it would take to make that number of
apprehensions.”)). Accordingly, the Court finds that apprehension figures alone do not establish
that Border Patrol’s operations increased to the extent alleged by Rancho.
Rancho likewise failed to provide evidence linking alleged damage to the property to
increased Border Patrol activity. Rancho’s expert on this point was unconvincing. Rancho’s
expert acknowledged that he had not considered Border Patrol activity on the property over prior
decades and that, at times, he attributed debris left by migrants to Border Patrol. (Tr. Scheidt,
105:13–14, 107:22–25). He also conceded that his opinion did not rely on Border Patrol
disclosures, operational data, or apprehension statistics. (Id.,109:13–18). Nor did he quantify
habitat trampling before and after construction of the border wall. (Id., 109:19–110:1).
Zachary Wick (“Mr. Zach Wick”), SD Commercial’s Business Development Officer, has
observed Border Patrol and ATVs operating on the property since at least 2013. (Tr. Z. Wick,
9
The parties dispute whether Border Patrol is authorized to enter private property for purposes of
enforcing the immigration laws. See 8 U.S.C. § 1357(a). The Court agrees with the United States
the statute affords immigration officers broad authority to apprehend individuals “within a
distance of twenty-five miles from any [] external boundary” of the United States. Id. Even
assuming otherwise, however, neither party disputes Border Patrol’s longstanding presence on
the Property. Indeed, in Otay Mesa I, the trial court observed that by the mid-to-late 1990s
Border Patrol’s activities had become “highly visible” as agents occupied fixed positions on the
Property to deter illegal immigration. 86 Fed. Cl. at 790 (describing Border Patrol’s presence as
“highly visible [by the mid-to-late- 1990s] as agents assumed fixed positions on the subject
property to deter illegal alien activity.”). The record in this case is no different. Additionally,
Rancho introduced no evidence at trial disputing Border Patrol’s historical use of the Property.
Accordingly, to the extent Rancho contends that Border Patrol’s mere presence on the Property
constitutes a taking, such a claim was, and remains, time-barred. See Otay Mesa I, 86 Fed. Cl. at
787–791 (“[Border Patrol’s] open and notorious use of the land put Plaintiffs on inquiry notice of
the Border Patrol's activity and precludes them from arguing lack of knowledge.”); 28 U.S.C. §
2501. Against this backdrop, Rancho must demonstrate that Border Patrol’s activities following
the creation of the 700-foot gap materially exceeded the scope of the use previously found to be
time-barred in the prior litigation.
9
permanent physical taking based on the installation and operation of the sensors, Rancho did not
litigate or prove damages on that theory. The Court cannot disregard the theory on which Rancho
tried its case or construct an alternative measure of compensation on its behalf.
Rancho expressly acknowledges that its claim is for a temporary taking arising from the
gap in the border wall, notwithstanding the Federal Circuit’s prior conclusion that the installation
and operation of the sensors constitutes a permanent physical taking. (Tr. Pls.’ Counsel, 13:1–7
(“[T]his case is about the federal government’s . . . use and occupation of plaintiffs’ property . . .
amounting to a temporary taking[.]”), 17:11–14, 408:23–409:17). Just compensation in a
temporary taking is typically the fair rental value of the property for the period of the taking.
Otay Mesa Property L.P., 670 F.3d at 1364. Fair rental value is the rent that likely would have
been obtained through a hypothetical negotiation between the property owner and a lessee for the
temporary interest appropriated by the government. Kimball Laundry Co. v. United States, 338
U.S. 1, 7 (1949).
Rancho’s valuation evidence was minimal. The only proffered evidence came from
Rancho’s party representative, Mr. David Wick. Ostensibly, his valuation opinion was based on
his experience negotiating “hundreds and hundreds” of leases in the region. (Tr. D. Wick, 301:7–
15). The two specific leases offered, however, were those negotiated with Border Patrol’s wall
contractor. More specifically, those two leases involved a three-acre portion of the Property at
approximately $4,167 per acre per month, (id., 315:24–317:2; JX 12), and a 5.5-acre portion at
approximately $5,400 per acre per month, (id., 313:12–314:8). Based on these figures, Mr. David
Wick opined that the fair rental value was $3,267 per acre, per month. (Tr., 327:20–328:2). He
then applied the $3,267-per-acre monthly rental rate to the entire 791.11 acres over a 55-month
period, corresponding to the duration of the alleged temporary taking, and arrived at a total
damages figure exceeding $130 million. (Tr. D. Wick, 328:18–329:1, 360:17–23).
The Court is not persuaded by this valuation method. Rancho did not tender Mr. David
Wick as an expert and conceded that his opinion rests entirely on his personal experience
negotiating leases. (See Tr. Pls.’ Counsel, 321:3–10). While Mr. David Wick referenced
“thousands” of leases he purportedly negotiated, none were admitted into evidence, leaving the
Court unable to evaluate their comparability to Rancho’s property. (Tr. D. Wick, 301:20, 311:23,
320:13–18). The Court finds that the two agreements referenced by Mr. David Wick were
contracts with a government contractor for construction of the border wall; these are not reliable
indicators of fair rental value as would be understood in a market transaction between willing
participants.
Nevertheless, the Court has theorized on a methodology to calculate just compensation
for Border Patrol’s use of Rancho’s land for sensor placement. See Vaizburd v. United States,
384 F.3d 1278, 1285–87 (Fed. Cir. 2004) (traditional compensation methods are not exclusive).
The Court has considered whether Rancho’s request for more than $130 million in just
compensation might supply some measure of damages. But that figure is unavailing for at least
two reasons. First, it is based on Rancho’s temporary taking theory which relies on a fair rental
value methodology. Second, it appears to derive, at least in part, from an approximation of the
compensation initially awarded, but ultimately rejected, in Otay Mesa. 670 F.3d at 1367–69
(rejecting damages analysis in Otay Mesa Property, L.P. v. United States, 93 Fed. Cl. 476, 487–
90 (2010)). Neither approach finds support in the trial record. Indeed, Rancho’s damages theory
14
is predicated on the totality of Border Patrol’s activities on the property—including foot patrols,
vehicle traffic, horseback patrols, drone overflights, and sensors. Yet, of all of the activities
comprising Rancho’s Fifth Amendment claim, surreptitious sensors are the least obtrusive and
pose the least interference with Rancho’s rights. Additionally, Rancho failed to address any
evidence at trial relating to the method or manner of installation.
Moreover, despite testifying that Border Patrol activity was concentrated in roughly thirty
percent of the property nearest the gap, Mr. David Wick’s application of his rental-rate estimate
to the entire 791.11-acre property for the full 55-month period is implausible. (Tr. D. Wick,
364:13–365:4, 365:9–13 (The Court: “[So] as long as there is some Border [P]atrol activity on
the property . . . you’re entitled to just compensation for the temporary take of the entire
property?” Mr. David Wick: “That is our -- what we’re pleading.”), 370:6–14). Even if the Court
found this method credible, Mr. David Wick offered no evidentiary basis to support his
assertions that Border Patrol’s activity was concentrated on 30-percent of the property or his
application of that estimate to the entirety of the property. 13 Absent a credible evidentiary basis
for determining just compensation, Rancho failed to meet its burden of proving damages. 14 The
surprising failure to offer persuasive evidence regarding just compensation affects the entirety of
Rancho’s claim.
The Federal Circuit is clear; a determination of just compensation must focus on exactly
what has been taken. Otay Mesa Property, L.P., 779 F.3d at 1320. Even had Rancho advanced a
13
During a site visit, the Court observed that Border Patrol activity appeared to be concentrated
in a relatively small area near the location of the former 700-foot gap. The visit was largely
guided by the parties, and Plaintiffs did not direct the Court to other portions of the property for
inspection. Moreover, the areas viewed during the visit appeared to comprise only a small
fraction of the Subject Property’s 791.11 acres.
14
At trial, Mr. David Wick testified that Border Patrol’s presence on the Property prevented
Rancho from marketing the Property for mitigation banking. (Tr. D. Wick, 307:16–308:13).
Mitigation banking is a process through which the environmental impacts of development are
offset by restoring, creating, enhancing, or preserving wetlands, habitat, or other natural
resources at an approved mitigation site. Despite this contention, Mr. Wick acknowledged that
no regulatory agency had informed Rancho that the Property was ineligible for mitigation
banking because of Border Patrol’s presence. (Id., 342:24–343:3). Likewise, although Rancho's
mitigation banking expert, Mr. Vincent Scheidt (“Mr. Scheidt”), opined that the costs associated
with establishing a mitigation bank could render the endeavor economically infeasible, (Tr.
Scheidt, 112:5–9), he also acknowledged that portions of the Property remained “highly suitable”
for mitigation banking. (Tr. Scheidt, 81:20-22 (stating “[P]ortions of the property . . . contain
some of the rarest plants and animals in Southern California[.]”)). Notably, Mr. Scheidt did not
prepare a cost estimate to support his opinion regarding economic infeasibility. (Id., 112:5–21).
Finally, Mr. Wick testified that Rancho has made no effort since 2021 to pursue approval of the
Property as a mitigation bank. (Tr. D. Wick, 343:22–344:2). Taken together, the evidence does
not establish that the Property was unsuitable for mitigation banking or that Border Patrol’s
activities foreclosed Rancho from pursuing such use.
15
permanent takings theory based on the presence of new sensors, it offered no evidence
whatsoever regarding the recompense for Border Patrol’s unapproved sensor usage. Rancho’s
hypothetical $130 million figure is also in no sense “just.” In Otay Mesa, the Circuit
characterized Border Patrol’s placement of sensors as “a minimally invasive permanent easement
to use undeveloped land” and recognized that under the easement “each sensor must be located
so as not to affect the functionality of the property.” Otay Mesa, L.P., 670 F.3d at 1368. As to
compensation for those sensors, the Circuit’s findings foreclosed the idea that commercial leases
alone might provide appropriate evidence of just compensation due. Id. at 1368–69. The sensors
at issue in the present litigation are not distinguishable and Rancho’s failure of proof is baffling,
given the unequivocal outcome in Otay Mesa.
Otay Mesa provides little guidance regarding the appropriate measure of compensation.
In the original proceedings, the trial court awarded approximately $3 million for fourteen sensors
based upon the parties’ stipulation that a taking had occurred and a valuation methodology that
relied on the property's rental value. Otay Mesa, L.P., 670 F.3d at 1368. The Federal Circuit
vacated that award, holding that the trial court had employed an improper measure of damages.
See id. Certainly, Rancho does not contend that the vacated award in Otay Mesa provides an
appropriate measure of compensation here. On remand, the trial court concluded that the sensor
easement created a risk that the property would be rejected for mitigation banking, thereby
diminishing its fair market value. Otay Mesa Property, L.P. v. United States, 110 Fed. Cl. 732,
747 (2013). In reaching that conclusion, the trial court found that the easement created a risk that
the property could be rejected for mitigation banking purposes and ultimately awarded $455,520,
representing approximately five percent of the property's fair market value. Id.
The evidentiary record here, however, does not permit a similar valuation analysis.
Unlike in Otay Mesa, there has been no stipulation regarding liability, and Rancho introduced no
evidence concerning the Property's fair market value, electing instead to rely exclusively on
testimony regarding fair rental value—a measure the Federal Circuit expressly rejected in Otay
Mesa. 779 F.3d at 1325. The only evidence of fair market value came from the United States'
appraiser, Mr. Stephen Roach (“Mr. Roach”), who opined that the Property's fair market value
remained unchanged at $39,560,000 in both the “before” and “after” conditions. (Tr. Roach, Tr.
719:17–21, 721:8–722:14, 734:17–736:8). Mr. Roach testified that the Property's highest and
best use, considered as a whole, was mitigation. (Id., 699:25–700:4). He valued the Property in
its “before” condition using nine comparable sales of mitigation properties and concluded that it
was worth $50,000 per acre, resulting in a “before” value of $39,560,000. (Id., 703:7–18,
719:17–21). Plaintiffs' rebuttal appraiser, Mr. Lance Doré (“Mr. Doré”), agreed that Mr. Roach's
“before” valuation was accurate. (Tr. Doré, 833:7–16).
Even if the Court were to rely on Mr. Roach's appraisal as evidence of the Property's fair
market value, the record remains insufficient to determine just compensation. Mr. Roach valued
the Property as a whole, whereas Mr. David Wick testified that Border Patrol's activities were
concentrated on only approximately thirty percent of the Property. (Tr. D. Wick, 370:6–14). As
previously explained, awarding compensation based on the value of the entire Property would
not comport with the principles of just compensation because it would bear no relationship to the
limited property interest taken. Moreover, unlike the plaintiffs in Otay Mesa, Rancho presented
no evidence allocating the Property among its potential highest and best uses or identifying
which portions of the Property were suitable for mitigation and the acreage that could be devoted
16
to that use. See 110 Fed. Cl. at 738 (finding plaintiffs appraiser determined each parcel's highest
and best use by evaluating physical and legal characteristics and concluded that 619 acres were
best suited for mitigation and 278 acres for industrial development). Without evidence
identifying the affected acreage and its corresponding value, Rancho failed to prove the amount
of just compensation, leaving the Court without a basis to determine an appropriate damages
award.
IV. Decision and Order of Judgment
Based on the foregoing, the United States is liable for a taking, specifically through the
placement of sensors on Rancho’s property. However, Rancho has failed to carry its burden of
proof as to just compensation. Pursuant to RCFC 58, the Clerk is DIRECTED to enter final
judgment in favor of the United States. The parties shall meet and confer and file a Joint Status
Report proposing redactions to this Memorandum Opinion within fourteen (14) days of its entry
to allow the Court to file a public version of the Opinion.
IT IS SO ORDERED.
s/ David A. Tapp
DAVID A. TAPP, Judge
17