Keystone Bituminous Coal Ass'n v. Debenedictus

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Keystone Bituminous Coal Ass'n v. Debenedictus, 480 U.S. 470 (1987) was an important United States Supreme Court case regarding the interpretation of a "taking". The court upheld a Pennsylvania law which limited coal mining that caused damages to buildings, dwellings and cemeteries through subsidence. Despite the fact that the law required 50% of the coal beneath those structures to be left in place (an amount representing approximately 2% of plaintiff's total coal in place, see id. at 496), a 5 to 4 decision written by Justice Stevens found that the law did not constitute a regulatory taking under the Fifth Amendment to the United States Constitution. Justices Rehnquist, Powell, O'Connor and Scalia dissented.

This decision ran in stark contrast to Pennsylvania Coal Co. v. Mahon, an earlier case that was decided on substantially similar facts. The defining difference between the cases was not in the facts, but in the court's determination of what constituted a taking. In the Pennsylvania Coal case, the Court looked at the reduction in value of the coal as was affected by the regulation. The reduction in value was found to be great and, as a result, amounted to a taking.

The framework for the Penn Central Transportation Co. v. New York City test for regulatory takings was altered by the Keystone verdict. In Keystone, the Court found that the takings denominator - that is, what the regulated party had before regulation - should be enlarged. In Pennsylvania Coal they looked at the Coal that was 'taken' and divided it by the value of the coal in that immediate area. When faced by a similar question in Keystone, the Court chose to divide by the amount of coal the company held - which, in this case, meant that Keystone had lost a very small percentage of value (something along the lines of five percent). When using this greatly reduced percentage, the court found that there had been no taking that required compensation.