Background

The Fifth Amendment is one of the ten amendments in the US Bill of Rights, ratified in 1791. Its Takings Clause, "nor shall private property be taken for public use, without just compensation", bars government seizure of property without payment, alongside separate protections against self-incrimination and double jeopardy. Courts apply two main tests to takings claims: the categorical LUCAS test, where a regulation eliminates all economic value, and the multi-factor Penn Central test, weighing economic impact and interference with investment-backed expectations.

In 2026 the Takings Clause became the central instrument used by data-centre developers to challenge government moratoriums. RCM Hill LLC filed a $100 million federal suit against Hill County, Texas over its moratorium on the 1,235 MW Project Aquila campus; the county rescinded the moratorium unanimously seven days later, on 4 June 2026, though the lawsuit remains active. A separate rehearing filed 28 May 2026 argues the DOE's Section 202(c) grid-curtailment order constitutes a physical and regulatory taking of backup-generation assets.

Courts have historically upheld emergency grid curtailment as settled regulatory power, but a local legislature targeting a single named industry class has weaker precedent protection, making The Hill County case a novel test. The pattern, where local governments retreat rather than litigate a takings claim to conclusion, is likely to recur as more US jurisdictions weigh data-centre moratoriums against developer legal exposure.

Common Questions

Can the Fifth Amendment be used to block a data centre moratorium?

Developers are actively using the Fifth Amendment's regulatory-takings doctrine to challenge moratoriums. RCM Hill LLC filed a $100 million suit against Hill County Texas; the county rescinded its moratorium seven days later, though the lawsuit continues.Source: RCM Hill LLC v Hill County filing

What is a regulatory taking under the Fifth Amendment?

A regulatory taking occurs when a government law or order so restricts property use that it effectively deprives the owner of economic value without direct seizure. Courts apply the LUCAS or Penn Central tests to determine whether compensation is owed.Source: US constitutional law: Lucas v South Carolina Coastal Council; Penn Central Transportation Co v New York City

Did Hill County repeal its data centre moratorium because of a lawsuit?

Hill County voted unanimously on 4 June 2026 to rescind its moratorium, seven days after RCM Hill LLC filed a $100 million Fifth Amendment suit over its 1,235 MW Project Aquila campus. The lawsuit remains active and the developer still seeks damages.Source: Hill County public record / RCM Hill LLC filing

Is the DOE's Section 202(c) curtailment order a constitutional taking?

Parties challenging the DOE's Order 202-26-06 filed a rehearing on 28 May 2026 arguing it constitutes both a physical and regulatory taking. Courts have historically upheld emergency curtailment as settled regulatory power; resolution is not expected before 2027.Source: DOE 202(c) rehearing filing

What is the Fifth Amendment's Takings Clause?

The Takings Clause bars the government from seizing private property for public use without just compensation. Courts assess claims under the categorical LUCAS test or the multi-factor Penn Central test.

Source Material

Fifth Amendment: US Constitution, Congress.gov

How the World Sees Them

Data-centre developers

The Fifth Amendment takings argument creates a credible legal cost for any jurisdiction that enacts a moratorium, even if courts ultimately reject the claim. Hill County's immediate repeal shows the threat works as a deterrent.

Federal regulators (DOE, FERC)

The 202(c) rehearing argues that grid-emergency curtailment orders, not just local moratoria, can constitute compensable takings, a claim that, if upheld, would structurally limit federal grid-emergency authority.

Local governments and regulators

The RCM Hill precedent exposes municipal moratoriums to liability even for temporary freezes. Some legal analysts argue the DOE curtailment challenge will fail on settled emergency-authority grounds.