California’s highest court just made it harder for cities to seize private water companies, ruling that courts — not city councils — get the final say on whether a government takeover is truly necessary.
The unanimous decision stops Apple Valley’s decade-long attempt to take control of Apple Valley Ranchos Water Company through eminent domain. The town of 75,000 in San Bernardino County must now prove in court that its seizure meets legal standards, not just declare it does.
“The town of Apple Valley argues that its decision to take the utility is subject to the usual standard governing judicial review — meaning, in effect, that the court can disallow the taking only if it concludes that the town has grossly abused its discretion,” Justice Leondra Kruger wrote in the 7-0 opinion. “We do not” accept that argument.
What This Means for Property Rights
The ruling rejects the town’s claim that city officials deserve near-total deference when they vote to condemn private property. Under Apple Valley’s theory, courts could only stop a seizure if city leaders had “grossly abused” their authority — an almost impossible standard to meet.
Instead, the Supreme Court held that judges must independently determine whether a government takeover is actually necessary. That’s a much tougher test for cities to pass, especially when targeting profitable private companies.
The decision sends the case back to a California appeals court, which had previously sided with Apple Valley’s more permissive interpretation.
A Fight Dating to 2010
The dispute began when investment firm Carlyle Infrastructure Partners bought the water utility serving Apple Valley. Town officials later moved to seize the company, arguing public ownership would be better for residents.
Apple Valley Ranchos fought back, asking courts to decide what “necessary” actually means when government condemns private property. The company argued cities shouldn’t get blank-check authority to take over businesses simply by voting to do so.
The ruling affects how California cities can use eminent domain — traditionally reserved for roads, schools, and genuine public necessities — against functioning private utilities. Apple Valley now faces a higher bar to prove its takeover plan serves a legally sufficient purpose.
Key Points
- California’s high court unanimously rejected Apple Valley’s attempt to seize a private water utility with minimal judicial oversight
- Cities must now prove to courts that government takeovers are truly necessary, not just declare them so by resolution
- The ruling strengthens property rights protections against eminent domain abuse by requiring independent judicial review
https://www.courthousenews.com/california-supreme-court-halts-socal-towns-water-utility-takeover/ – August 25, 2026
