Maryland Threatens to Take "House of Cards" by Eminent Domain

What skullduggery is this?  Netflix/House of Cards’ star, Frank Underwood (Kevin Spacey) was recently spotted in Annapolis lobbying legislators towards a new law that would make available additional tens of millions of dollars in tax breaks from the State of Maryland (reported by Bloomberg here).  A legislative hearing is scheduled for April 2, 2013 before Maryland law-makers.  On the agenda is a bill that would increase available tax breaks from the current $7.5 million to $18.5 million.  If the legislation passes, word on the street is that House of Cards would be the primary beneficiary.  In light of this, House of Cards style leveraging is out in full force, to wit, the show’s producers’ statement: “In the event sufficient incentives do not become available, we will have to break down our stage, sets and offices and set up in another state.”

In response to that ultimatum, State delegate William Frick introduced a law that would permit the State to take the intellectual or real property of a film production company by eminent domain if the company ceased production in-state after receiving more than $10 million in State tax breaks.  House of Cards can be taken/condemned under the proposed law.  Whether the law would pass constitutional muster is another story. (“nor shall private property be taken for public use without just compensation.” U.S. Const. Amendment V).

Who’s going to blink first?

This episode reminds us of the efforts of the City of Oakland more than 30 years ago, which tried to use eminent domain to stop the Oakland Raiders from leaving the bay area to relocate to Los Angeles.  Their efforts were unsuccessful, but the Raiders eventually returned to Oakland and, more importantly to those of us in the eminent domain world, the experience led a group of talented eminent domain attorneys at that time to forge a union which later led to the formation of Owners Counsel of America.

We’ll keep you posted on whether the House of Cards can be taken.

For more background on the issue, see:

Washington Post article.

Fox news article.