What happens to fair compensation when the government forcibly takes private land?
The Supreme Court signaled last month that it will address this issue. It’s not the first time the justices have confronted a version of it: eminent domain, the power that allows the state to seize private property for public purposes, has long been part of the legal landscape, and even in 2026 the question remains pressing. Yet the latest case before the Court serves as a reminder that landowners can still face unfair bargains, despite safeguards designed to prevent such outcomes.
Back in 2018, Leonard Hoffmann and neighboring North Dakota residents learned from WBI Energy Transmission, a builder of natural gas pipelines, that their land would be taken. The company operates privately, but it holds a certificate of public convenience granting it eminent-domain authority. It offered to pay roughly half of the property’s market value, according to the Institute for Justice, the public-interest law group representing the plaintiffs.
That proposal created a clear problem. The Fifth Amendment’s Takings Clause promises “just compensation” when private property is seized for public use, and the Supreme Court has already said that this means fair market value. Hoffmann and others sued, and after a judge allowed them to present evidence of the land’s true value, the case settled. The district court also ruled that WBI Energy Transmission must cover the plaintiffs’ legal costs incurred in pursuing compliance with the law, which came out to approximately $383,375.
Nevertheless, the Eighth Circuit overruled that portion of the ruling. The decision came as a surprise. “For over 40 years, lower courts have consistently held that private companies exercising the federal power of eminent domain under the Natural Gas Act must follow the compensation rules of the states in which the condemned property sits,” the plaintiffs note in their petition to the Court. “The decision…forthrightly acknowledged that it split with published decisions of the Third, Fifth, Sixth, and Eleventh Circuits.”
North Dakota law allows judges to restore plaintiffs to their original financial position. WBI Energy Transmission, however, argued that the question should be controlled by federal law, which offers no such protection. What might that interpretation mean for others? “The United States currently has some 3 million miles of natural-gas pipelines, with more constantly on the way,” the plaintiffs’ petition says. “These pipelines frequently lead to condemnations nationwide. And the question of just compensation is at issue in every single one of those condemnations—to say nothing of the countless private negotiations that happen in the shadow of a pipeline company’s condemnation power.”
When the Supreme Court reconvenes, it will consider resolving the legal split between the 8th Circuit and its sisters. But the question is also one of common sense. What is the point of vindicating your constitutional right to fair market value if you have to pay hundreds of thousands of dollars for the privilege?
