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Between 1923 and 1947, Arkansas Power & Light (AP&L) constructed dams on two Arkansas lakes, Hamilton and Catherine. The company obtained “flood easements” on property adjoining the lakes. The easements permitted AP&L to “clear of trees, brush and other obstructions and to submerge by water [the adjoining land].” AP&L properly recorded its easements.
In May 1990, extraordinarily heavy rains fell, and water reached the highest levels ever recorded. AP&L opened the gates of one dam, called Carpenter, causing water to rise 25 feet. This flood caused massive damage to the landowners' real estate. Several dozen landowners sued, claiming that AP&L was negligent in opening the dam and in failing to warn homeowners of their intended action. The United States District Court granted summary judgment for AP&L, and the landowners appealed.
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