Robinson v. New Jersey Transit Rail Operations, Inc.

          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 - ...