In the case of San Diego Gas & Electric Co. v. City of San Diego et al., 1980, the U.S Supreme Court was asked to decide whether a regulatory taking had occurred when the city denied a development proposal by SDG&E for its own land due to environmental concerns. The company argued that this denial constituted as a "taking" under the Fifth Amendment's Takings Clause, which states that private property cannot be taken for public use without just compensation. However, in an opinion delivered by Justice Brennan, it was held that while regulation can constitute a taking if it goes too far and deprives an owner of all economically viable use of their property or significantly diminishes its value; mere diminution in value does not qualify as such unless it is tantamount to deprivation of all economic benefits from ownership rights. In this instance, since SDG&E still retained substantial beneficial use after denial (including selling or leasing), no compensable taking had occurred.

In the dissenting opinion for San Diego Gas & Electric Co. v. City of San Diego et al., Justice Brennan, joined by Justices White and Marshall, argued that the majority's decision to remand the case was unnecessary and premature. He contended that there were no factual disputes requiring resolution by a jury; instead, he believed it was purely a legal question about whether or not regulatory action constituted a "taking" under the Fifth Amendment. The dissent also criticized the majority for failing to provide lower courts with guidance on how to handle such cases in future instances. Furthermore, they disagreed with the notion that compensation should be paid when regulation merely decreases property value rather than completely denying its use or causing physical invasion - arguing this would place an undue burden on government’s ability to regulate land use effectively.