PHILADELPHIA - Pennsylvania isn't the place for a lawsuit against a New Jersey agency, the state Supreme Court recently ruled.
The March 12 decision, authored by Justice Kevin Brobson, stops Cedric Galette from using Philadelphia's court, known for high-dollar verdicts, to sue New Jersey Transit. It overturned two previous rulings in lower courts that denied NJ Transit's motion to dismiss on the grounds of interstate sovereign immunity.
Lower courts decided NJ Transit is not an instrumentality or arm of New Jersey and wasn't entitled to that immunity.
"Like the immunity associated with the Eleventh Amendment, interstate sovereign immunity is grounded in the federal Constitution," Brobson wrote. "A state's waiver of that immunity, therefore, must be express.
"Galette has failed to identify any provision of New Jersey law generally or the New Jersey Tort Claims Act specifically that evinces New Jersey's express consent to be sued in Pennsylvania courts pursuant to Pennsylvania law."
Galette was a passenger in a car driven by Julie McCrey in Philadelphia on Aug. 9, 2018. His lawsuit, which also names McCrey as a defendant, alleges a bus owned and operated by NJ Transit struck the car and caused him various injuries.
He filed suit in 2020 in Philadelphia, to which NJ Transit responded that it is an "arm" of the State of New Jersey. The trial judge and Superior Court subsequently rejected this argument.
The state Supreme Court examined the U.S. Supreme Court's 2019 ruling in Hyatt III, which involved the Franchise Tax Board of California facing suit in Nevada. The decision addressed interstate sovereign immunity and overturned precedent in place for the previous 40 years.
The 5-4 ruling held states have immunity from lawsuits filed in other states. NJ Transit also pointed at a Third Circuit ruling that concluded it is an arm of the State of New Jersey.
The Superior Court had acknowledged Hyatt III's effect but held NJ Transit wasn't an arm of New Jersey, using a six-factor test. The state Supreme Court then said it must give importance to whether a sister state considers the agency a part of it.
NJ Transit was established in 1979 by the New Jersey Public Transportation Act. The legislation said it was created to provide "efficient, coordinated, safe and responsive public transportation," and that "as a matter of public policy, it is the responsibility of the State to establish and provide for the operation and improvement of a coherent public transportation system in the most efficient and effective manner."
The New Jersey legislature called it "an instrumentality of the State" and said its operation is "an essential government function."
NJ Transit is required to deliver the minutes of every board meeting to the governor, who must approve any actions to be taken. It also provides an annual report on its activities to the governor, president of the Senate and the speaker of the General Assembly.
Furthermore, NJ Transit can acquire land and property through eminent domain.
"Indeed, the Transportation Act provides a good reason to believe that the State of New Jersey designed NJ Transit to enjoy the protections of interstate sovereign immunity," Brobson wrote.
"As a co-equal sovereign to New Jersey, Pennsylvania must honor this decision and refuse to allow NJ Transit to be haled into Pennsylvania courts to defend against private suits."
New York's highest court recently reached an opposite ruling in a case against NJ Transit. Brobson said, "Our disagreements with the New York High Court are obvious."