The Dignity Crutch: Understanding Sovereign Immunity After Franchise Tax Board of California v. Hyatt

By KC Hooker.

In May 2019, the Supreme Court decided Franchise Tax Board of California v. Hyatt, which overturned Nevada v. Hall and held that citizens cannot sue a state in another state’s courts. The decision was not surprising given the Court’s expansion of sovereign immunity—or the idea that governments are immune from suits by private parties—since the mid 1990s. As the Court expanded sovereign immunity during that decade, it departed from the literal text of the Eleventh Amendment, which limits federal court jurisdiction to entertain suits against states, and began to rely on a principle called the “dignity rationale.” The dignity rationale is the idea that States are immune from suit because it is an affront to their dignity, as sovereign entities, to be dragged into court at the insistence of private parties. The Court has held that protecting State dignity is the preeminent purpose of sovereign immunity. If protecting state dignity is the preeminent purpose of sovereign immunity, one would expect the Court to talk about dignity in Hyatt. It did not. Why did the Court abandon the dignity rationale in Hyatt? I argue that Hyatt shows that the Court was never serious when it appealed to state dignity. Rather, the Court merely used the dignity rationale as a crutch to support its holdings when constitutional and historical arguments were found lacking.

The Court’s first notable use of the dignity rationale was in Seminole Tribe of Florida v. Florida, which held that Congress could not abrogate a state’s sovereign immunity pursuant to the Commerce Clause. There, the Court had an explicit constitutional provision, the Eleventh Amendment, to ground its holding, so the majority only mentioned state dignity in passing. The Court then expanded the dignity rationale in Alden v. Maine, in which the Court held that states are immune from suit in their own courts. There, the Eleventh Amendment did not support the Court’s holding because that amendment only speaks to federal-court jurisdiction. The Court instead relied on history to show that the founding generation generally believed states were immune from suit, and that history was a major justification for its decision. However, facing a lack of constitutional arguments, the Court used the dignity rationale as a substantive justification for sovereign immunity in its own right. The Court next gave a full-throated endorsement of the dignity rationale in Federal Maritime Commission v. South Carolina State Ports Authority. In that case, the Court held that the states are immune from adjudicative proceedings in federal administrative agencies. The Eleventh Amendment does not speak to those kinds of suits, and because administrative adjudication is a modern development, history did not support the Court’s holding either. The Court nevertheless declared that the preeminent purpose of sovereign immunity is to protect the dignity of the States, and it used that justification to support its holding.

Fast-forward seventeen years to Hyatt. There, the Court relied on history to show that the Founder’s believed that States were immune from suit in another State’s courts. The Court also relied on several constitutional provisions, such as the Full Faith and Credit Clause, to establish an implicit constitutional doctrine that States cannot use their own law to govern interstate disputes. So, in Hyatt, the Court had both historical and constitutional arguments to support its holding. Given those justifications, the Court apparently decided that it did not need to use the dignity rationale.

These cases demonstrate an inverse relationship between the Court’s reliance on the dignity rationale and the strength of its historical and constitutional arguments. Because of this relationship, it seems that the Court was not serious when it said that the preeminent purpose of sovereign immunity is to protect state dignity. If that were true, the Court would have used that rationale in Hyatt. It had multiple opportunities to do so because the dignity issue was thoroughly briefed. So, with the gift of hindsight, it seems that the Court has been determined to expand State sovereign immunity regardless of constitutional text or history, and it invented the dignity rationale as a crutch when it needed additional justification for that expansion.

The opinions expressed herein are those of the individual contributors to the ASLJ Blog and should not be construed as the opinions of the Arizona State Law Journal or the Sandra Day O’Connor College of Law at Arizona State University.

KC Hooker
J.D. Candidate 2021
KC is a 2L staff writer from Heber City, Utah. He graduated magna cum laude with honors from Utah Valley University in philosophy. In his free time, KC enjoys playing music, eating Mexican food, and spending time with his wife and two-year-old daughter.

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