Cite as: 538 U. S. 216 (2003)
Opinion of the Court
These hypotheticals persuade us that lawyers and LPOs may occasionally deposit client funds in an IOLTA account when those funds could have produced net interest for their clients. It does not follow, however, that there is a need for further hearings to determine whether Brown or Hayes is entitled to any compensation from the respondents.
The Rules adopted and administered by the Washington Supreme Court unambiguously require lawyers and LPOs to deposit client funds in non-IOLTA accounts whenever those funds could generate net earnings for the client. See supra, at 224-225. Thus, if the LPOs who deposited petitioners' money in IOLTA accounts could have generated net income, the LPOs violated the court's Rules. Any conceivable net loss to petitioners was the consequence of the LPOs' incorrect private decisions rather than any state action. Such mistakes may well give petitioners a valid claim against the LPOs, but they would provide no support for a claim for compensation from the State, or from any of the respondents. The District Court was therefore entirely correct when it made the factual finding "that in no event can the client-depositors make any net return on the interest accrued in
which was deducted from the amount held in the interpleader fund. See id., at 157, 160. The creditors in Webb's recovered an amount equal to their net loss. Indeed, in Webb's we expressly limited our holding to "the narrow circumstances of this case," id., at 164, and reserved decision on the question whether any compensation would have been due if the clerk had not charged a separate fee. See id., at 164-165.
Justice Scalia is mistaken in stating that we hold that just compensation is measured by the amount of interest "petitioners would have earned had their funds been deposited in non-IOLTA accounts." Post, at 244 (dissenting opinion). We hold (1) that just compensation is measured by the net value of the interest that was actually earned by petitioners and (2) that, by operation of the Washington IOLTA Rules, no net interest can be earned by the money that is placed in IOLTA accounts in Washington. See IOLTA Adoption Order, 102 Wash. 2d 1101, 1114 (1984) ("IOLTA funds are only those funds that cannot, under any circumstances, earn net interest (after deducting transaction and administrative costs and bank fees) for the client").
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