Editor’s Note: Law Week Colorado edits court opinion summaries for style and, when necessary, length.
This case concerns the application of Colorado’s Revised Uniform Unclaimed Property Act and its interaction with the takings clause of the Fifth Amendment, as applied to the states through the 14th Amendment.
After learning that Colorado took possession of specific property under RUUPA, David Knellinger and Robert Storey filed suit, alleging that Colorado’s unclaimed property scheme violated the takings clause.
The district court dismissed their claims for lack of standing. In its view, they failed to sufficiently allege ownership of the property at issue, in part because the plaintiffs never filed an administrative claim to establish ownership as required by RUUPA.
Knellinger and Storey appealed, arguing that they alleged facts sufficient to state a claim that Colorado took their property for public use without just compensation. The 10th Circuit Court of Appeals agreed.
It concluded that property owners who plausibly allege that Colorado has taken custody of their property under RUUPA, and used it for public purposes, need not file administrative claims with Colorado before they may sue for just compensation.
The court held that the moment a state takes private property for public use without just compensation, a property owner has an actionable claim under the takings clause. At this phase in the litigation, the 10th Circuit found that it was premature to decide whether any such taking occurred here.
But, taking the allegations of the complaint as true and viewing them in the light most favorable to the nonmovant, the 10th Circuit held that the property owners in this case stated a plausible claim for damages and therefore adequately pleaded an injury sufficient to confer standing.
According to the 10th Circuit, the district court did properly dismiss plaintiffs’ equitable claims because 42 U.S.C. § 1983 provided an adequate basis for Knellinger and Storey to obtain just compensation for any taking.
The 10th Circuit affirmed the district court’s dismissal of plaintiffs’ equitable claims, reversed the dismissal of their damages claims and remanded to the district court for proceedings consistent with this opinion.