Lingle v. Chevron U.S.A. Inc.
Facts
Hawaii enacted Act 257 in response to concerns about concentrated gasoline markets and high retail prices, and the statute capped the rent oil companies could charge lessee-dealers at service stations. Chevron, a major gasoline refiner and wholesaler in Hawaii, leased many stations to independent dealers and challenged the rent cap as a facial taking. The parties stipulated that the cap would reduce Chevron's rent on some stations but allow more rent on others, and that Chevron had earned and expected to continue earning a return satisfying any constitutional standard. Chevron argued only that the statute effected a taking because it did not substantially advance Hawaii's asserted interest in controlling retail gasoline prices.
Issue
Whether the 'substantially advances legitimate state interests' formula announced in Agins is an appropriate standalone test for determining whether a regulation effects a taking under the Fifth Amendment. More specifically, could Hawaii's rent cap be invalidated as a taking solely because it allegedly failed to substantially advance the State's objectives?
Rule
A regulation does not effect a taking merely because it does not substantially advance a legitimate state interest. The Agins 'substantially advances' formula prescribes a due process-type means-ends inquiry, not a takings inquiry, and has no proper place in takings jurisprudence. Regulatory takings analysis instead proceeds under recognized takings frameworks such as physical takings, total deprivation under Lucas, Penn Central balancing, and the special exactions rules of Nollan and Dolan.
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