A May 1 ruling in federal district court in Washington, D.C., found that a failure of U.S. Army Corps of Engineers-built levees in New Orleans allowed flooding and led to an illegal government taking of private property. The ruling has potentially big implications, prompting experts to consider appeals.

"I can't see the Corps not wanting an appeal on this," says Les Edelman, a senior counsel and senior advocate at Dawson and Associates Inc., a Washington, D.C.-based consulting firm specializing in federal water resources and environmental policy. Edelman was for 19 years chief counsel at the Corps. "You can't even imagine the amount of liability this opens up," he says. The decision of whether to appeal rests with the Dept. of Justice, but the Corps will have input, he says. No decision has been announced.

While the ruling contains fodder for an appeal, it opens a path for recovering damages in cases that may have been legally insufficient under the Federal Tort Claims Act, comments Liz Fagot, also a Dawson senior adviser. Previous claims for damage resulting from defective Corps flood-control works have failed when brought on those grounds.

The ruling by U.S. Court of Federal Claims Judge Susan Braden found that the flooding was caused by the construction, operation, maintenance and enlargement of the Mississippi River to Gulf Outlet (MRGO) by the Corps. and that the U.S. is liable for flooding that occurred from Hurricanes Katrina, Rita, Gustav and Ike.

The MRGO, a commercial navigation channel that was closed in 2009, was authorized by Congress in 1956 and provided a 76-mile-long shortcut from the Mississippi River below New Orleans to the Gulf of Mexico.