Cite as: 538 U. S. 216 (2003)
Scalia, J., dissenting
funds placed in IOLTA accounts are those which could not have earned net interest for the client in a non-IOLTA savings account. App. 150. This approach defines petitioners' "net loss" as the amount of interest they would have received had their funds been deposited in separate, non-IOLTA accounts. See ante, at 239 ("[I]f the [Limited Practice Officers (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").
This definition of just compensation has no foundation in reason. Once interest is earned on petitioners' funds held in IOLTA accounts, that money is petitioners' property. See Phillips, 524 U. S., at 168 ("[A]ny interest that does accrue attaches as a property right incident to the ownership of the underlying principal"). It is at that point that the State appropriates the interest to fund LFW—after the interest has been generated in the pooled accounts—and it is at that point that just compensation for the taking must be assessed. It may very well be, as the Court asserts, that petitioners could not have earned money on their funds absent IOLTA's mandatory pooling arrangements, but just compensation is not to be measured by what would have happened in a hypothetical world in which the State's IOLTA program did not exist. When the State takes possession of petitioners' prop-erty—petitioners' money—and transfers it to LFW, the property obviously has value. The conclusion that it is devoid of value because of the circumstances giving rise to its creation is indefensible.
Consider the implications of the Court's approach for a case such as Webb's Fabulous Pharmacies, Inc. v. Beckwith, 449 U. S. 155 (1980), which involved a Florida statute that allowed the clerk of a court, in his discretion, to invest inter-pleader funds deposited with that court in interest-bearing certificates, the interest earned to be deemed " 'income of
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