Supreme Court of the United States
545 U.S. 469, 125 S.Ct. 2655 (2005)
A government entity may not take property belonging to one private party for the sole purpose of transferring it to another private party, even if compensation is paid. However, property may be taken and transferred from one private party to another if “use by the public” is the purpose of the taking.
A “purely private” taking serves no legitimate public purpose and would be void. Property should not be taken under the pretext of a public purpose.
The “public purpose” requirement is defined broadly, deferring to legislative judgment. The ultimate purpose of the taking is what matters, not the mechanics of how the purpose is carried out.
Promoting economic development is a traditional and acceptable function of government. Property may therefore be condemned to foster economic development, even if private parties also benefit.
When the legislative purpose is legitimate and the means are rational, a court should defer to legislative judgment. Courts should not engage in debates over the wisdom of a particular property taking.