Grand River is a nonnavigable tributary of the navigable Arkansas River and flows through Oklahoma. Respondent was created by the Oklahoma Legislature to develop hydroelectric power on the Grand River. It is, to use the statutory language of the law creating it, 'a governmental agency and body politic and corporate.' Session Laws of Oklahoma, 1935, c. 70, Art. 4, § 1, 82 O.S.1951 § 861. A report of the Army Corps of Engineers, made in 1930, indicated that federal development at Pensacola, Markham Ferry, and Ft. Gibson-all sites on the Grand River-was not then economically justified. Respondent, following its creation in 1935, proposed a river development plan at these three sites. In 1939 the Army Engineers recommended a three-dam coordinated project as a federal undertaking. Congress by the Flood Control Act of August 18, 1941, incorporated that Grand River plan into a comprehensive plan for the Arkansas River basin.
Meanwhile respondent obtained a license under § 23(b) of the Federal Power Act to build and operate a project at Pensacola and completed it in 1940. The United States took over the operation of this project during World War II, after which it was returned to respondent. In 1946 the United States started the construction of a project at Ft. Gibson. It has been completed as an integral part of a comprehensive plan for the regulation of navigation, the control of floods, and the production of power on the Arkansas River and its tributaries. Congress, by modifying its plan for the Arkansas River basin, cleared the way for respondent to obtain from the Federal Power Commission a license for a project at Markham Ferry. Thus the United States operates the Ft. Gibson project which is the farthest downstream, while the respondent has the two upstream projects. A 70-acre tract owned by the respondent was condemned when the Ft. Gibson project was built; flowage rights over its lands were acquired; and payment was made for relocation of its transmission lines. Respondent claimed more. It demanded of the United States $10,000,000 for the 'taking' of its water power rights at Ft. Gibson and its franchise to develop electric power and energy at that site. The Court of Claims, while reserving the question as to the amount of compensation due, held by a divided vote that the United States was liable. Ct.Cl., 175 F.Supp. 153. The case is here on a writ of certiorari. 361 U.S. 922, 80 S.Ct. 292, 4 L.Ed.2d 239.