Programme OS2a Trade and globalisation
SHOULD U.S. WATER TAKINGS JURISPRUDENCE INFLUENCE
NAFTA CH. 11 APPROPRIATION CLAIMS FOR WATER?
Author(s): Jonathan R. Schutz
Somach, Simmons & Dunn
813 Sixth Street, Third Floor
Sacramento, CA 95814
I am a water attorney in
California, United States.
transboundary, trade, globalisation, governance, institution, treaty, appropriation, taking, water law, law
Session: OS2a Trade and globalisation
In 2001, Roger Marzulla in won a historic legal case in the United States in
Tulare Lake Basin Water Storage District v. United States, 49 Fed. Cl. 313 (Fed. Cl. 2001). This case threatened
to change U.S. takings law as it applied to water. In Tulare Lake, Marzulla successfully sued the U.S. government
on behalf of irrigators who had their water supply reduced to leave water in the streams for fish pursuant to the U.S.
Endangered Species Act. The irrigators successfully argued that because the amount of their available water was
reduced, the federal government had taken the irrigators’ water rights without financial compensation as required
under the U.S. Constitution. The case was decided in the U.S. Court of Claims—the court in the U.S. that decides
compensation claims against the federal government.
Riding on the success in Tulare Lake, Mr. Marzulla
filed a NAFTA Chapter 11 claim against Mexico on behalf of a group of Texas farmers and irrigators. This case is
still pending. The claim alleges that Mexico withheld water that originates in Mexico but is rightfully owned by the
irrigators pursuant to a 1944 Treaty between the U.S. and Mexico for the Rio Grande and Colorado Rivers. The
Texas irrigators argue that Mexico appropriated the water, thereby violating the provisions of NAFTA’s Ch. 11.
Recently, Mr. Marzulla also filed three more lawsuits in the Court of Claims alleging the taking of private
irrigators’ water rights by the federal government. The courts in all three of these cases have determined that no
takings occurred and that no compensation was due to the irrigators. The courts so held because water rights are
treated differently than other forms of property. This paper analyzes the nature of water rights in the U.S. and under
The NAFTA tribunal is poised to rule on the Texas irrigators’ Ch. 11 claim against Mexico. One
of the issues in this case, and in other NAFTA cases over water resources, is the nature of water rights under
NAFTA and whether U.S. water takings jurisprudence should be applied to NAFTA Ch. 11 appropriation claims.
This paper will review water rights takings jurisprudence in light of the recent Court of Claims cases.
paper concludes that the courts were correct in determining that water rights should not be subject to the same
takings jurisprudence as other forms of real property. Lastly, this paper argues that U.S. water law takings
jurisprudence should not be used to evaluate NAFTA Ch. 11 compensation claims. However, if U.S. water takings
law is used to evaluate the pending Texas irrigators Ch. 11 claim, the three recent Court of Claims cases should
make it clear that no appropriation has occurred and that the Texas irrigators are not entitled to compensation.
Other Themes Addressed:
1. Water Governance and Water Security: Improving legal
and institutional frameworks
2. Water Governance and Water Security: Transboundary river basins and shared
3. Water Availability, Use and Management: Regional Sessions, North America