Judge awards Greensboro landowners nearly $8.9 million in rail-trail dispute

A federal judge has ordered the government to pay 21 Greensboro landowners nearly $8.9 million over a 3.1-mile stretch of the Downtown Greenway, turning a rail-trail dispute into a major public-cost case for Guilford County. U.S. Court of Federal Claims Senior Judge Loren A. Smith entered the ruling on June 10, and the award stems from the conversion of a former Norfolk Southern Railway corridor into trail use.

The corridor was approved by the Surface Transportation Board for interim trail use and railbanking, and court records say the City of Greensboro is the trail sponsor. In this case, the federal government conceded liability, leaving only compensation to be decided. The landowners had asked for more than $44.7 million before interest, a gap that shows how sharply the parties disagreed over the value of the property interests affected by the trail.

For Greensboro, the decision matters well beyond the payment itself. The money comes from the federal side of the case, so the award will ultimately be paid by the government rather than by the city or the landowners who won it. It also reinforces the financial risk that can follow rail-to-trail conversions when private property owners claim that a public trail has taken a compensable interest in land once tied to railroad use.

The Downtown Greenway has said the city reached an agreement with Norfolk Southern in 2019 to purchase rights for greenway installation along the Norfolk Southern Railway Atlantic & Yadkin Railroad corridor under the Trails Act. That agreement helped move the project forward, but the federal takings fight shows how long the legal tail can be on abandoned railroad property, especially when development plans overlap with land that once sat inside a rail corridor.

The ruling adds to a growing body of Greensboro rail-trail litigation. In 2025, Lewis Rice LLC said its attorneys secured a $52 million judgment for Kotis entities in another federal takings case involving property along the same former Norfolk Southern rail corridor near Battleground Avenue, a case that was also described as possibly the largest rails-to-trails award ever. Together, the two cases suggest that future trail projects built from old railroad rights-of-way may face closer scrutiny, higher valuation fights and larger settlement demands before they are finished.