Scott Pung purchased the ranch‑style home in 1991, and after his death the property remained in the estate, but in 2010 the county stripped the family’s primary‑residence exemption, treating it as a second home and levying a $2,241.93 tax.
County officials launched foreclosure proceedings; a trial court initially halted the sale but the Court of Appeals later cleared the way, culminating in a public auction where the house fetched $76,008—less than half its $194,400 assessment. An investor bought the property at auction and resold it on the open market for $195,000 within 18 months.
Pung sued Isabella County, arguing that the Fifth Amendment’s Takings Clause required compensation based on the home’s full market value. The district court granted him a partial summary judgment, awarding the surplus above the tax debt, and the Sixth Circuit affirmed that position.
Justice Alito, writing for the majority, held that the auction price is the constitutional baseline for compensation after a properly conducted tax sale, rejecting the full‑market‑value theory and warning that the latter would unduly burden local governments. The Court vacated the Sixth Circuit’s judgment and remanded the case for further proceedings.