Hess v. Port Authority Trans-Hudson Corporation, 513 U.S. 30 (1994)

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certiorari to the united states court of appeals for the third circuit

No. 93-1197. Argued October 3, 1994—Decided November 14, 1994

Petitioners, two railroad workers, were injured in unrelated incidents while employed by respondent bistate railway, the Port Authority Trans-Hudson Corporation (PATH). PATH is a wholly owned subsidiary of the Port Authority of New York and New Jersey (Port Authority or Authority), an entity created when Congress, pursuant to the Constitution's Interstate Compact Clause, consented to a compact between the Authority's parent States. Petitioners filed separate personal injury actions under the Federal Employers' Liability Act (FELA). The District Court dismissed the suits under Third Circuit precedent, Port Authority Police Benevolent Assn., Inc. v. Port Authority of New York and New Jersey, 819 F. 2d 413 (CA3) (Port Authority PBA), which declared PATH a state agency entitled to Eleventh Amendment immunity from suit in federal court. The Third Circuit consolidated the cases and summarily affirmed. That court's assessment of PATH's immunity conflicts with the Second Circuit's decision in Feeney v. Port Authority Trans-Hudson Corporation, 873 F. 2d 628.

Held: PATH is not entitled to Eleventh Amendment immunity from suit in federal court. Pp. 39-53. (a) The Court presumes that an entity created pursuant to the Compact Clause does not qualify for Eleventh Amendment immunity unless there is good reason to believe that the States structured the entity to arm it with the States' own immunity, and that Congress concurred in that purpose. Lake Country Estates, Inc. v. Tahoe Regional Planning Agency, 440 U. S. 391, 401. The Port Authority emphasizes that certain indicators of immunity are present in this case, particularly provisions in the interstate compact and its implementing legislation establishing state control over Authority commissioners, acts, powers, and responsibilities, and state-court decisions typing the Authority as an agency of its parent States. Other indicators, however, point away from immunity, particularly the States' lack of financial responsibility for the Authority. Pp. 39-46. (b) When indicators of immunity point in different directions, the Court is guided primarily by the Eleventh Amendment's twin reasons

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