United States District Court, D. New Jersey
OPINION & ORDER
STANLEY R. CHESLER, U.S.D.J
This
matter comes before the Court on the motion to vacate the
judgment or, in the alternative, for remittitur by Defendant
New Jersey Transit Rail Operations, Inc.
(“NJTRO”). For the reasons stated below, the
motion will be denied.
This
motion comes after a jury trial in which the jury awarded
$300, 000 in damages to Plaintiff. Defendants move to vacate
that judgment or, in the alternative, for the Court to Order
remittitur.
Defendants
first argue that the judgment should be vacated because NJTRO
is entitled to the protection of sovereign immunity under the
Eleventh Amendment. The parties agree that, in Fitchik v.
N.J. Transit Rail Operations, Inc., 873 F.2d 655 (3d
Cir. 1989), the Third Circuit held that New Jersey Transit
Rail Operations, Inc. - the same entity as the Defendant in
the instant case - was not entitled to sovereign immunity
under the Eleventh Amendment. There is also no dispute that
the Third Circuit has not overruled Fitchik.
Defendants argue that Fitchik does not bind this
Court because “intervening Third Circuit precedent -
taking into account United States Supreme Court authority
handed down after Fitchik - has held that the panel
in Fitchik improperly weighted the three factors to
be considered to determine if an entity is an arm of the
state.” (Defs.' Br. 12-13.) Plaintiff, on the other
hand, contends that the Third Circuit has not overruled
Fitchik, which constitutes binding precedent.
In
Fitchik, the Third Circuit established a
three-factor test for entitlement to soverign immunity:
(1) Whether the money that would pay the judgment would come
from the state . . .;
(2) The status of the agency under state law . . .; and
(3) What degree of autonomy the agency has.
Fitchik, 873 F.2d at 659. The Third Circuit held
that the first factor was the “most important.”
Id.
In
Benn v. First Judicial Dist., 426 F.3d 233, 239-40
(3d Cir. 2005), the Third Circuit considered the Supreme
Court's decision in Regents of the Univ. of Cal. v.
Doe, 519 U.S. 425, 431 (1997), and held that the first
of the three factors does not hold primacy, and that the
three factors must be weighted equally. Because § 9.1 of
the Third Circuit's Internal Operating Procedures states
that a precedential decision is binding on subsequent panels
and may be overruled only in a decision en banc,
Benn did not, and could not, overrule
Fitchik.
In
reply, Defendant argues that it is the Supreme Court's
Doe decision, not the Third Circuit's
Benn decision, that overruled Fitchik. If
only it were so simple! Doe did not expressly
overrule Fitchik. Nor did Doe establish a
test for sovereign immunity, or discuss the weight to be
given to the question of whether the money that would pay the
judgment would come from the state. Note the phrasing used by
the Third Circuit in Benn: “The Judicial
District argues that following the decision by the Supreme
Court in Doe, 519 U.S. at 425, we can no longer
ascribe primacy to the first factor. We agree.”
Benn, 426 F.3d at 239. The Third Circuit did not
state that, after Doe, the holding of
Fitchik cannot stand. Instead, the Third Circuit
stated that, going forward, the first factor cannot be more
important than the other two.
Defendants
confuse two related, but different, questions. The first is:
what is controlling authority for the issue at hand in the
motion presently at bar? The second is: what legal principles
govern new analyses of sovereign immunity in the Third
Circuit? The questions significantly differ. It appears
correct that the Third Circuit no longer adheres to the legal
principle applied in Fitchik (the first factor has
primacy). That does not mean, however, that the holding of
Fitchik - NJTRO is not entitled to sovereign
immunity - is wrong under current law. Defendants would like
to persuade that, because the sovereign immunity analysis has
changed in the Third Circuit, Fitchik would be
decided differently today, but this Court does not agree, as
will be explained in the discussion which follows.
Defendants
overlook the continuing vitality of the Supreme Court's
holding in Hess v. Port Auth. Trans-Hudson Corp.,
513 U.S. 30, 47 (1994) (“When indicators of immunity
point in different directions, the Eleventh Amendment's
twin reasons for being remain our prime guide.”)
In 2006
- after Benn in 2005 - ...