Oyster farming is hard work. The often-muddy estuary bottoms must be prepared with rocks to create reefs which the oyster growers will seed with immature oysters. Two or three years later, the oysters may be harvested, sorted, and sold.

But who owns the oysters and when? Do the oyster farmers have a property right in the oysters after they seed the beds? Do they own the oysters after they harvest them? And who owns the oysters after they are served up in an oyster bar? Strangely, in a bizarre defense against a takings claim in Campo v. United States, the United States recently argued that the State of Louisiana owns oysters from the time they are seeded to the time they are ingested. Citing authority from John Locke to the modern statutes, the Court of Federal Claims did not agree.

In Louisiana, the state owns the saltwater bottomlands which it leases to the oyster farmers. After preparing and seeding the beds, the oyster growers come back in a couple of years and harvest the oysters. The problem in Campo was that when the United States Corps of Engineers in 2019 opened a spillway for 123 days to protect New Orleans, it flushed 10 trillion gallons of fresh water over the oyster beds, killing most of the oysters.

The oyster growers sued for an uncompensated taking in violation of the Fifth Amendment to the United States Constitution in the Court of Federal Claims. But the United States, being loath to pay for what it destroyed, tried to shuck off the claims. It moved to dismiss the complaint, claiming that the oyster farmers were only lessees and had no protectable property interests in the oysters.

On December 23, 2021, Judge Ryan Holte denied the motion. The decision is a delicious dish for property rights mavens everywhere.

At bottom, the core of the dispute is what property interest, if any, do the oyster farmers have in their oysters. To the federal government, the answer was not as obvious as it seems. The United States noted that no Louisiana statute expressly says that the oysters belong to the people who seed and harvest them. Moreover, the Louisiana Supreme Court had earlier absolved the state when it destroyed oysters as part of a flood control project. Thus, the United States argued, because the oyster farmers still had their leases and did not own the oysters, nothing had been taken.

When pressed at the hearing on the motion to dismiss, the United States’ attorney averred, “I think an argument could be made that the oysters are still not the property of the oyster lessees, even after they’ve been harvested.” When the court asked whether this meant that oysters are never private property at all and whether the state still owned the oysters even after they were sold, the government’s attorney agreed that such “an argument could be made.” (Here’s a practice tip: Taking one’s argument to its most illogical extreme is not a winning litigation technique.)

Invoking authority ranging from John Locke’s Second Treatise on Government to Louisiana civil law, the court took a deep dive into the nature and origin of property rights. The court plowed through Louisiana state court decisions and found they did not apply, mainly because they dealt only with the state constitutional claims. The court next plucked what pearls of wisdom could be found in Louisiana’s statutory law and found it did not conclusively resolve the question of who owned the oysters (probably because the notion that they didn’t belong to the oyster growers probably never occurred to anyone before). Given the absence of any definitive state law on the subject of oyster ownership, the court turned to the common law and John Locke.

The opinion began with a quote from John Locke’s Second Treatise on Government where Locke explained what today is known as the labor theory of property: “Whatsoever then he removes out of the state of that nature hath provided, and left it in, he hath mixed his labour with, and joined to it something that is his own, and thereby makes it his property.”

Consistent with Lockean theory, the court noted that the government had admitted that preparing oyster beds, seeding them, and harvesting the oysters “‘takes a lot of labor effort’” and “‘it’s pretty difficult work.’” And as the Louisiana Supreme Court once noted, “‘[Oyster farmers] have to put in blood, sweat and toil in order to sometimes turn muddy water bottoms into an area that could be used for oyster cultivation.’”

The government tried to suggest that the oyster growers “do not sell their property rights in oysters but rather merely receive payment for ‘the fruits of [their] effort[s].’” But that is exactly what property is – the fruits of one’s labor. The court quoted Locke’s admonition that “1 percent of the value of ‘every thing’ ‘is purely owning to nature’ whereas 99 percent of the value is ‘wholly to be put on the account of labor.’”

The United States tried an alternate argument: that oysters are like fish and wild game that are not private property until they are fished or hunted. That would mean that any damage to the oysters occurring before harvesting is just too bad – no harm, no foul. The court rejected that argument as well, because, well, oysters are not fish or game: “Oysters are not mobile like foxes, rats, and fish. Oysters lack legs, feet, fins, and flippers.” Instead, they are more like crops, just like the raisins that were seen as private property in the Supreme Court’s decision in Horne v. United States. Noting that “‘‘unwritten common law’ or ‘policies and practices’ also can rise to the level of creating property interests,’’” the court concluded oysters had all the indicia of private property: they could be possessed, used, and sold with the profits going to the oyster growers.  

If citing such common law principles and John Locke weren’t enough, the court proceeded to find wisdom in James Madison’s 1792 Essay on Property where Madison admonished that “Government is instituted to protect property of every sort … that alone is a just government, which impartially secures to every man, whatever is his own.”

The court concluded that “[t]he government’s suggestion [that] plaintiffs are compensated for ‘the fruits of [their] efforts,’ yet … lack property rights in the oysters, runs counter to the Lockean foundation of the Fifth Amendment Takings Clause.” Instead, the mixing of their “backbreaking” efforts with the seed and oysters “confirms plaintiffs have quintessential Lockean property rights in the oysters.”

This decision stands in marked contrast to a recent case out of the Virginia Supreme Court. Pacific Legal Foundation filed an amicus brief in Johnson v. City of Suffolk, arguing the oystermen should be able to recover from the City of Suffolk because they had a valid inverse condemnation claim under the Virginia Constitution.  The Court disagreed, finding theoyster growers had no compensable property right after they sued a city for damages caused by pollution. There, the court reasoned, the oyster growers have only “limited” property rights as a matter of state law: the right to occupy the leased lands and the right to harvest the oysters. The court found that their right to the exclusive possession of the leased lands was not harmed by the pollution (even though it was made worthless) and the city did not actually remove the oysters – it only made them unusable. Perhaps a bit of Lockean logic would have helped the court come to a more just result.

While we might expect the United States to appeal this Louisiana decision to the Federal Circuit, the court’s discussion of the origins and nature of private property will long outlast this dispute. For lovers of property rights, and oysters, this decision is a tasty treat indeed.

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