In the case of David H. Lucas v. South Carolina Coastal Council, 1991, the U.S Supreme Court ruled in favor of Lucas who had purchased two beachfront lots intending to build single-family homes on them. However, after his purchase, South Carolina passed a law that barred him from building any permanent structures on his land due to erosion concerns and protection of public beaches and property values. The court held that while states have power to regulate private property use without compensation for public good under its police powers; when regulations deny all economically beneficial or productive use of land it goes beyond regulation and equates with government appropriation requiring compensation unless principles inherent in title prohibit those uses even absent regulation (nuisance exception). In this case there was no nuisance exception so Lucas was entitled to compensation as he was left with a valueless piece of property by state action.

In the dissenting opinion for Lucas v. South Carolina Coastal Council, Justice Blackmun argued that the majority's decision was a departure from established precedent and an unnecessary expansion of property rights at the expense of environmental protection. He contended that previous cases had recognized that regulations could significantly reduce property value without constituting a taking requiring compensation under the Fifth Amendment if they served to prevent serious public harm. In this case, he believed that preventing beachfront development to protect against hurricane damage and preserve natural resources constituted such a harm prevention measure. Furthermore, he criticized the majority's creation of a categorical rule entitling owners to compensation whenever regulations deprive them of all economically beneficial use, arguing it would lead to arbitrary results and undermine states' ability to enact land-use restrictions for environmental purposes.