428
Opinion of the Court
for money judgment is the single most important factor in determining whether an entity is an arm of the state." Ibid. The majority opinion gave decisive weight to the terms of the University's agreement with the Department, which made it "clear that the Department, and not the State of California, is liable for any judgment rendered against the University in its performance of the Contract." Ibid.
The dissenting judge did not take issue with the majority's emphasis on the importance of the defendant's liability for a money judgment, but he reasoned that the proper analysis should focus on the primary legal liability rather than the ultimate economic impact of the judgment. Noting that it was undisputed that a judgment against the University "is a legal obligation of the State of California," id., at 777, he discounted the significance of the indemnitor's secondary, or indirect, liability. For his conclusion, he relied on Ninth Circuit precedent suggesting that a State may not confer Eleventh Amendment immunity on an entity or individual who would otherwise not enjoy that immunity simply by volunteering to satisfy judgments against the entity, Durning v. Citibank, N. A., 950 F. 2d 1419, 1425, n. 3 (1991), or by passing a statute indemnifying individual officers from liability, Blaylock v. Schwinden, 862 F. 2d 1352, 1353-1354 (1988). "The question is not who pays in the end; it is who is legally obligated to pay the judgment that is being sought." 65 F. 3d, at 777-778.
Because other Courts of Appeals agree with the dissent's
focus on legal rather than financial liability,4 we granted certiorari to resolve the conflict. 518 U. S. 1004 (1996).
4 See Cronen v. Texas Dept. of Human Services, 977 F. 2d 934, 938 (CA5 1992) ("[T]he source of the damages is irrelevant when the suit is against the state itself or a state agency"); Cannon v. University of Health Sciences/The Chicago Medical School, 710 F. 2d 351, 357 (CA7 1983) ("No authority supports Cannon's argument that [the Eleventh Amendment] analysis is altered by the possibility that a damage award would be met through insurance proceeds or from federal funds").
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