Five years after the second-most costly storm in U.S. history hit the Texas Gulf Coast, the effects of Hurricane Harvey are fresh in the greater Houston area.
Residents are still displaced awaiting repairs to their homes, and traumatic memories remain firmly implanted as much of the litigation over who will pay for the unprecedented damage is still in its early stages.
For five days starting the evening of Aug. 25, 2017, there was barely a break in rainfall. The weight of the water compressed the Earth’s crust by almost two centimeters across the region, researchers would later discover.
The storm that dumped more than 50 inches of rain over the Houston area also caused closures of the basement-level central jury assembly room in Harris County and both the civil and criminal courthouses there. After the still-under-repair buildings were deemed safe enough to resume courtroom operations — which meant judges were required to share available courtroom space for months — the COVID-19 pandemic closed them down again.
Harvey’s damage resulted in the largest-ever takings case against the U.S. government.
Thousands of property owners who lived upstream, or behind, the Addicks and Barker reservoirs on Houston’s west side alleged the U.S. Army Corps of Engineers owed compensation for intentionally flooding their homes by keeping the water behind the dam gates, where they had built homes without warning that their properties were in a flood plain.
The government contended that was necessary to avoid catastrophic damage to downtown Houston.
And thousands of other property owners who lived downstream of the reservoirs allege the government owes them compensation for opening the gates — even if to avoid a catastrophic failure of the dam gates — and allowing the flood waters to inundate their properties.
The challenges brought on by the pandemic further stalled the multidistrict litigation cases spawned by the storm and the hundreds of other lawsuits with thousands of other plaintiffs trying to hold someone accountable for the damages caused by the torrential rains. And a smoldering fight between Houston and the Texas General Land Office over recovery funding has left goals for ensuring another Harvey doesn’t happen in limbo.
As Houston reflects this week on the anniversary of Hurricane Harvey, The Texas Lawbook spoke to attorneys involved in the biggest pieces of litigation about where the cases stand and what comes next.
U.S. Court of Federal Claims Judge Charles Lettow came to Houston in the summer of 2019 to preside over a two-week bench trial where the upstream plaintiffs were seeking a finding that the government was responsible for the flooding of their properties.
He sided with the property owners in a December 2019 ruling that cleared the way for the damages portion of the bifurcated trial.
But then came COVID-19.
“We lost almost nine months to a year to COVID because the judge wanted to do a trial in-person, and then couldn’t do a trial in person,” said Daniel Charest of Burns Charest, who was the lead attorney during the liability portion of the case. “So, we were in a vortex.”
The damages trial eventually took place in-person before Judge Lettow and concluded in June.
Property owners presented evidence that the government’s permanent flowage easement on their land means they are owed between 65 percent and 85 percent, and in some cases 100 percent, of the value of their homes. The exact dollar figure is unknown, but will likely exceed $5 billion.
The parties are scheduled to be back in D.C. before Judge Lettow Sept. 29 for oral arguments, and Charest will be arguing on behalf of the plaintiffs next month.
“We’ve argued the flowage easement is worth up to 100 percent of the value,” he said, explaining that could cause other issues for the property owners he represents. “There is a possibility that the government, having been forced by the court to pay for 90 percent, would just pay for the rest and take the whole thing.”
Calling that a “policy-driven outcome” rather than a litigation-driven outcome, he said it’s going to be entirely up to the government to decide whether the residents behind the flood gates will be allowed to be compensated for the value of the taking and remain in their homes or if they will be compensated and have to move.
The parties selected 13 properties out of thousands to proceed as bellwether cases in the upstream trial, and how Judge Lettow rules on damages for those homes and businesses will inform what damages can be sought for the remaining property owners.
In June the U.S. Court of Appeals for the Federal Circuit determined Judge Loren A. Smith of the Court of Federal Claims got it wrong when he dismissed the claims of thousands of property owners who lived downstream of the Addicks and Barker reservoirs in west Houston.
Judge Smith had held the plaintiffs — whose properties flooded when the Corps decided to open the dam gates so water that was being withheld could flow into Buffalo Bayou, toward downtown, through the ship channel and into Galveston Bay — weren’t entitled to “perfect flood control in the face of an Act of God.”
Many litigators involved in Harvey cases, including Larry Dunbar who is also an engineer, have said the downstream cases present a much more difficult scenario for the property owners to win because, generally speaking, dams reduce flooding downstream.
A 2004 ruling from the Texas Supreme Court in Tarrant Regional Water District v. Gragg — where downstream plaintiffs won a takings claim — weighs in their favor, however. Dunbar said that case turned on whether the government had changed the way it operated the dam, which is what the downstream plaintiffs allege happened during Harvey.
“[The Corps] had created this operating scheme they called induced surcharge operation that allowed them to open the gates when water gets to a certain level, but nobody really knew that,” Dunbar said. “The city didn’t know it, the county didn’t know it, it had never been triggered before.”
“The Corps knew how much flooding there would be if they did that, they had maps showing it … but again, they didn’t really tell everybody,” Dunbar said of the releases from the Addicks and Barker reservoirs. “So, it was a big surprise to everybody when it happened.”
Those 178 lawsuits, filed on behalf of thousands of claimants, that were consolidated for oral argument have now returned to Judge Smith’s court for further litigation. Both the government and the property owners had asked the Federal Circuit to rule outright on whether the government’s flooding of the land constituted a taking.
“We decline this invitation,” the court wrote before quoting its 1983 ruling in Yuba Goldfields v. U.S. “We have noted that ‘due to the fact-intensive nature of takings cases, summary judgment should not be granted precipitously.’”
Beck Redden partners Russell Post and David Gunn worked on the appeal. Both are residents of west Houston, but neither suffered flood damage in Harvey. Post did suffer flooding and property damage to his home during 2008’s Hurricane Ike, he said.
“I definitely felt the gravity of the engagement,” he said of working on this appeal. “We both felt the gravity and significance of the case for the Houston community and so many thousands of people who have been affected.”
Those personal experiences, he said, influenced his and Gunn’s thinking during the appeal, leaving them with a “very weighty sense of responsibility.”
“We believe very deeply that the property owners in west Houston downstream are just as entitled to fair compensation as upstream property owners,” Post said. “I think it would be anomalous and unjust if the courts failed to compensate all the property owners fairly.”
The fifth anniversary of Hurricane Harvey’s landfall means any property owners who have opted not to pursue their claims until now have only one year to make a claim. There is a six-year statute of limitations in takings cases.
“We’ve had more claims come in recently because of the anniversary,” said Charest. “But only about half of the people who had flooding have hired lawyers and are proceeding.”
Lawyers have said they’ve had difficulty making good connections with the possible claimants, and Charest said more town hall-style meetings, like those that took place in the early days after Hurricane Harvey, may be called soon to educate the possible plaintiffs about their recourse options.
“The people that live in these upstream areas have been inundated with attorneys and advertisements from all over for the past five years, and a lot of them have gone deaf to it,” he said. “But if they haven’t yet got it on file, in a year from now they will lose their claim and that’s never to come back.”
“I don’t care if they sign up with me, they just need to sign up,” he said. “Otherwise, they’re going to lose their claim forever and have a property grossly encumbered and there’s no recompense for it.”