Sovereign immunity in the United States

In 1793, the Supreme Court held in Chisholm v. Georgia that Article III, § 2 of the United States Constitution, which granted diversity jurisdiction to the federal courts, allowed lawsuits "between a State and Citizens of another State" as the text reads. In 1795, the Eleventh Amendment was ratified in response to this ruling, removing federal judicial jurisdiction from lawsuits "prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State". The validity and retroactivity of the Eleventh Amendment was affirmed in the 1798 case Hollingsworth v. Virginia.

In Hans v. Louisiana, the Supreme Court of the United States held that the Eleventh Amendment re-affirms that states possess sovereign immunity and are therefore immune from being sued in federal court without their consent. In later cases, the Supreme Court has strengthened state sovereign immunity considerably. In Blatchford v. Native Village of Noatak, the court explained that

we have understood the Eleventh Amendment to stand not so much for what it says, but for the presupposition of our constitutional structure which it confirms: that the States entered the federal system with their sovereignty intact; that the judicial authority in Article III is limited by this sovereignty, and that a State will therefore not be subject to suit in federal court unless it has consented to suit, either expressly or in the "plan of the convention." States may consent to suit, and therefore waive their Eleventh Amendment immunity by removing a case from state court to federal court. See Lapides v. Board of Regents of University System of Georgia.

(Citations omitted). In Alden v. Maine, the Court explained that while it has

sometimes referred to the States’ immunity from suit as "Eleventh Amendment immunity[,]" [that] phrase is [a] convenient shorthand but something of a misnomer, [because] the sovereign immunity of the States neither derives from nor is limited by the terms of the Eleventh Amendment. Rather, as the Constitution's structure, and its history, and the authoritative interpretations by this Court make clear, the States’ immunity from suit is a fundamental aspect of the sovereignty which the States enjoyed before the ratification of the Constitution, and which they retain today (either literally or by virtue of their admission into the Union upon an equal footing with the other States) except as altered by the plan of the Convention or certain constitutional Amendments.

Writing for the court in Alden, Justice Anthony Kennedy argued that in view of this, and given the limited nature of congressional power delegated by the original unamended Constitution, the court could not "conclude that the specific Article I powers delegated to Congress necessarily include, by virtue of the Necessary and Proper Clause or otherwise, the incidental authority to subject the States to private suits as a means of achieving objectives otherwise within the scope of the enumerated powers." Sovereign immunity as interpreted by the Supreme Court in Alden v. Maine means a constitutional prohibition of suits against states by its own citizens in state courts and federal courts.[15]

However, a "consequence of [the] Court's recognition of pre-ratification sovereignty as the source of immunity from suit is that only States and arms of the State possess immunity from suits authorized by federal law." Northern Ins. Co. of N. Y. v. Chatham County (emphases added). Thus, cities and municipalities lack sovereign immunity, Jinks v. Richland County, and counties are not generally considered to have sovereign immunity, even when they "exercise a 'slice of state power.'" Lake Country Estates, Inc. v. Tahoe Regional Planning Agency.

Separately, sovereign immunity of a state from lawsuits in other states have been in question. The Supreme Court ruled in Nevada v. Hall (1977) that states are not constitutionally immune from being named in lawsuits filed in other states. In the intervening years, many states developed legislation that recognize sovereign immunity of other states; since 1979, there had only been 14 legal cases that did involve a state being named as a litigant in a case heard in another state. The Supreme Court overturned Nevada in its 2019 decision of Franchise Tax Board of California v. Hyatt (Docket 17-1299) that states did enjoy constitutional sovereign immunity from lawsuits in other states.[16]

If the state or local government entities receive federal funding for whatever purpose, they cannot claim sovereign immunity if they are sued in federal court for discrimination. The United States Code, Title 42, Section 2000d-7 explicitly says this.

The 2001 Supreme Court decision of Board of Trustees of the University of Alabama v. Garrett seems to nullify this; however, numerous appellate court cases, such as Doe v. Nebraska in the 8th Circuit[22] and Thomas v. University of Houston of the 5th Circuit[23] have held that, as long as the state entity receives federal funding, then the sovereign immunity for discrimination cases is not abrogated, but voluntarily waived. Since the receiving of the federal funds was optional, then the waiver of sovereign immunity was optional. If a state entity wanted its sovereign immunity back, all they have to do in these circuits is stop receiving federal funding.

However, the 2nd Circuit does not share this ideal.[24] Currently, they are the only federal court of appeals to take this approach to the issue.[25]

In C & L Enterprises, Inc. v. Citizen Band, Potawatomi Indian Tribe of Oklahoma, 532 U.S. 411 (2001), the Supreme Court held that sovereigns are not immune under the Federal Arbitration Act. Since arbitration is a matter of contract between the parties, agreeing to participate in arbitration constitutes consent to be subject to the arbitrator's jurisdiction, thus constituting a voluntary waiver of immunity.[26]

Because the U.S. is a superior sovereign, it may need to bring suit against a state from time to time. According to the Supreme Court, proper jurisdiction for a contract suit by the United States Federal Government against a state is in Federal District Court.[27]

Similar to the U.S. v. state exclusion above, a state may also sue another state in the federal court system. Again, there would be a conflict of interest if either state's court system tried the case. Instead, the federal court system provides a neutral forum for the case.

Under Article III, Section 2 of the United States Constitution, the Supreme Court of the United States has original jurisdiction over cases between states. Congress, if it so chooses, may grant lower federal courts concurrent jurisdiction over cases between states. However, Congress has not yet chosen to do so. Thus, the United States Supreme Court currently has original and exclusive jurisdiction over cases between state governments.

The "stripping doctrine" permits a state official who used his or her position to act illegally to be sued in his or her individual capacity. However, the government itself is still immune from being sued through respondeat superior. The courts have called this "stripping doctrine" a legal fiction. Therefore, a claimant may sue an official under this "stripping doctrine" and get around any sovereign immunity that that official might have held with his or her position.

When a claimant uses this exception, the state cannot be included in the suit; instead, the name of the individual defendant is listed. The claimant cannot seek damages from the state, because the claimant cannot list the state as a party. The claimant can seek prospective, or future, relief by asking the court to direct the future behavior of the official.

For example, Ex parte Young allows federal courts to enjoin the enforcement of unconstitutional state (or federal) statutes on the theory that "immunity does not extend to a person who acts for the state, but [who] acts unconstitutionally, because the state is powerless to authorize the person to act in violation of the Constitution." Althouse, Tapping the State Court Resource, 44 Vand. L. Rev. 953, 973 (1991). Pennhurst State School and Hospital v. Halderman (465 U.S.) ("the authority-stripping theory of Young is a fiction that has been narrowly construed"); Idaho v. Coeur d'Alene Tribe of Idaho ("Young rests on a fictional distinction between the official and the State"). The Young doctrine was narrowed by the court in Edelman v. Jordan, which held that relief under Young can only be for prospective, rather than retrospective, relief; the court reasoned that the Eleventh Amendment's protection of state sovereignty requires the state's coffers to be shielded from suit. Prospective relief includes injunctions and other equitable orders, but would rarely include damages. This limitation of the Young doctrine "focused attention on the need to abrogate sovereign immunity, which led to the decision two years later in Fitzpatrick." Althouse, Vanguard States, supra, at 1791 n.216

The 42 U.S.C. § 1983 allows state officials to be sued in their individual or official capacities, a principle which was demonstrated again in Brandon v. Holt.[28]

The federal government and nearly every state have passed tort claims acts allowing them to be sued for the negligence, but not intentional wrongs, of government employees. The common-law tort doctrine of respondeat superior makes employers generally responsible for the torts of their employees. In the absence of this waiver of sovereign immunity, injured parties would generally have been left without an effective remedy. See Brandon v. Holt.[28]

Under the abrogation doctrine, while Congress cannot use its Article I powers to subject states to lawsuits in either federal courts, Seminole Tribe v. Florida, or a fortiori its own courts, Alden, supra, it can abrogate a state's sovereign immunity pursuant to the powers granted to it by §5 of the Fourteenth Amendment, and thus subject them to lawsuits. Seminole, supra; Fitzpatrick v. Bitzer. However:

• The court requires "a clear legislative statement" of intent to abrogate sovereignty, Blatchford, supra; Seminole, supra.
• Because Congress' power under §5 is only "the power 'to enforce,' not the power to determine what constitutes a constitutional violation," for the abrogation to be valid, the statute must be remedial or protective of a right protected by the Fourteenth Amendment and "[t]here must be a congruence and proportionality between the injury to be prevented or remedied and the means adopted to that end," City of Boerne v. Flores. But "[t]he ultimate interpretation and determination of the Fourteenth Amendment's substantive meaning remains the province of the Judicial Branch." Kimel v. Florida Board of Regents. Simply put: "Under the City of Boerne doctrine, courts must ask whether a statutory remedy has 'congruence and proportionality' to violations of Section 1 rights, as those rights are defined by courts." Althouse, Vanguard States, Laggard States: Federalism & Constitutional Rights, 152 U. Pa. L. Rev. 1745, 1780 (2004)
• States can expressly waive sovereign immunity, but do not do so implicitly simply by participating in a commercial enterprise where Congress subjects market participants to lawsuits. College Savings Bank v. Florida Prepaid Postsecondary Education Expense Board.

The Court has found that somewhat different rules may apply to Congressional efforts to subject the states to suit in the domain of federal bankruptcy law. In Central Virginia Community College v. Katz, the Court held that state sovereign immunity was not implicated by the exercise of in rem jurisdiction by bankruptcy courts in voiding a preferential transfer to a state. Justice Stevens, writing for a majority of five (including Justice O'Connor, in one of her last cases before retirement, and Justices Souter, Ginsburg, and Breyer), referred to the rationale of an earlier bankruptcy decision, but relied more broadly on the nature of the bankruptcy power vested in Congress under Article I. "The question", he stated, "[was] not whether Congress could 'abrogate' state sovereign immunity in the Bankruptcy Act (as Congress had attempted to do); rather, because the history and justification of the Bankruptcy Clause, as well as legislation enacted immediately following ratification, demonstrate that [the Bankruptcy Clause] was intended not just as a grant of legislative authority to Congress, but also to authorize limited subordination of state sovereign immunity in the bankruptcy arena." In reaching this conclusion, he acknowledged that the Court's decision in Seminole Tribe and succeeding cases had assumed that those holdings would apply to the Bankruptcy Clause, but stated that the Court was convinced by "[c]areful study and reflection" that "that assumption was erroneous". The Court then crystallized the current rule: when Congressional legislation regulates matters that implicate "a core aspect of the administration of bankrupt estates", sovereign immunity is no longer available to the States if the statute subjects them to private suits.

The Court in Central Virginia Community College v. Katz added this caveat: "We do not mean to suggest that every law labeled a 'bankruptcy' law could, consistent with the Bankruptcy Clause, properly impinge upon state sovereign immunity".

By way of the Tucker Act, certain claims of monetary damages against the United States are exempt from sovereign immunity. These cases are heard by the United States Court of Federal Claims, or, for cases involving less than ten thousand dollars, a district court has concurrent jurisdiction.

Examples of contracts where immunity is waived include:

• Debts incurred.
• Salaries of government employees.
• Tax refunds that have not been sent.
• Commercial contracts.
• Any contract that has a provision in it specifically waiving sovereign immunity.

If a plaintiff can demonstrate that the government's action was done in bad faith, the plaintiff can receive damages despite sovereign immunity. Typically if a party can demonstrate that the government intentionally acted wrongly with the sole purpose of causing damages, that party can recover for injury or economic losses. For example, if access lanes to a major bridge are closed for repair and the closure results in severe traffic congestion, the action was in good faith and the state could not be sued. However, if, as in the Fort Lee lane closure scandal, the lanes were closed in retaliation against a mayor who declined to support a politician's campaign, with the explicit purpose of causing traffic jams, such lawsuits could proceed.[29]