Main Content

Constitutional Structures

Federal Maritime Comm’n v. South Carolina Port Authority

[excerpt]

535 U.S. 743
Supreme Court of the United States

Federal Maritime Comm’n v. South Carolina Port AuthorityMay 28, 2002

Justice Thomas, delivered the opinion of the Court.

[1] This case presents the question whether state sovereign immunity precludes petitioner Federal Maritime Commission (FMC or Commission) from adjudicating a private party's complaint that a state-run port has violated the Shipping Act of 1984 . . . We hold that state sovereign immunity bars such an adjudicative proceeding.

I

[2] South Carolina Maritime Services, Inc. (Maritime Services), asked respondent South Carolina State Ports Authority (SCSPA) for permission to berth a cruise ship, the M/V Tropic Sea, at the SCSPA's port facilities in Charleston, South Carolina. . . .

[3] The SCSPA repeatedly denied Maritime Services' requests, contending that it had an established policy of denying berths in the Port of Charleston to vessels whose primary purpose was gambling. As a result, Maritime Services filed a complaint with the FMC, contending that the SCSPA's refusal to provide berthing space to the M/V Tropic Sea violated the Shipping Act. . . .

[4] To remedy its injuries, Maritime Services prayed that the FMC: (1) seek a temporary restraining order and preliminary injunction in the United States District Court for the District of South Carolina "enjoining [the SCSPA] from utilizing its discriminatory practice to refuse to provide berthing space and passenger services to Maritime Services;" (2) direct the SCSPA to pay reparations to Maritime Services as well as interest and reasonable attorneys' fees; (3) issue an order commanding, among other things, the SCSPA to cease and desist from violating the Shipping Act; and (4) award Maritime Services "such other and further relief as is just and proper."

[5] Consistent with the FMC's Rules of Practice and Procedure, Maritime Services' complaint was referred to an Administrative Law Judge (ALJ) [who dismissed the complaint].

[6] While Maritime Services did not appeal the ALJ's dismissal of its complaint, the FMC on its own motion decided to review the ALJ's ruling to consider whether state sovereign immunity from private suits extends to proceedings before the Commission. . . . The FMC held that sovereign immunity did not bar the Commission from adjudicating private complaints against state-run ports and reversed the ALJ's decision dismissing Maritime Services' complaint.

[7] The SCSPA filed a petition for review, and the United States Court of Appeals for the Fourth Circuit reversed. . .  and remanded the case with instructions that it be dismissed.

[8] We . . . affirm

[9] Dual sovereignty is a defining feature of our Nation's constitutional blueprint. See Gregory v. Ashcroft, 501 U. S. 452, 457 (1991). States, upon ratification of the Constitution, did not consent to become mere appendages of the Federal Government. Rather, they entered the Union "with their sovereignty intact." . . .

[10] States, in ratifying the Constitution, did surrender a portion of their inherent immunity by consenting to suits brought by sister States or by the Federal Government. . . Nevertheless, the Convention did not disturb States' immunity from private suits, thus firmly enshrining this principle in our constitutional framework.

[11] . . . [T]he Eleventh Amendment does not define the scope of the States' sovereign immunity; it is but one particular exemplification of that immunity.

III

[12] We now consider whether the sovereign immunity enjoyed by States as part of our constitutional framework applies to adjudications conducted by the FMC. Petitioner FMC and respondent United States initially maintain that the Court of Appeals erred because sovereign immunity only shields States from exercises of "judicial power" and FMC adjudications are not judicial proceedings.

[13] For purposes of this case, we will assume, arguendo, that in adjudicating complaints filed by private parties under the Shipping Act, the FMC does not exercise the judicial power of the United States. Such an assumption, however, does not end our inquiry as this Court has repeatedly held that the sovereign immunity enjoyed by the States extends beyond the literal text of the Eleventh Amendment. . .

A

[14] "[L]ook[ing] first to evidence of the original understanding of the Constitution," . . . as well as  early congressional practice . . . we find a relatively barren historical record, from which the parties draw radically different conclusions.

[15] In truth, the relevant history does not provide direct guidance for our inquiry. The Framers, who envisioned a limited Federal Government, could not have anticipated the vast growth of the administrative state. . . . Because formalized administrative adjudications were all but unheard of in the late 18th century and early 19th century, the dearth of specific evidence indicating whether the Framers believed that the States' sovereign immunity would apply in such proceedings is unsurprising.

[16] This Court, however, has applied a presumption—first explicitly stated in Hans v. Louisiana, supra —that the Constitution was not intended to "rais[e] up" any proceedings against the States that were "anomalous and unheard of when the Constitution was adopted." . . . We therefore attribute great significance to the fact that States were not subject to private suits in administrative adjudications at the time of the founding or for many years thereafter.

B

[17] To decide whether the Hans presumption applies here, however, we must examine FMC adjudications to determine whether they are the type of proceedings from which the Framers would have thought the States possessed immunity when they agreed to enter the Union.

[18] . . . [N]either the Commission nor the United States disputes the Court of Appeals' characterization below that such a proceeding "walks, talks, and squawks very much like a lawsuit." . . .

[19] A review of the FMC's Rules of Practice and Procedure confirms that FMC administrative proceedings bear a remarkably strong resemblance to civil litigation in federal courts. . .  

C

[20] The preeminent purpose of state sovereign immunity is to accord States the dignity that is consistent with their status as sovereign entities. . . .

[21] Given both this interest in protecting States' dignity and the strong similarities between FMC proceedings and civil litigation, we hold that state sovereign immunity bars the FMC from adjudicating complaints filed by a private party against a nonconsenting State. Simply put, if the Framers thought it an impermissible affront to a State's dignity to be required to answer the complaints of private parties in federal courts, we cannot imagine that they would have found it acceptable to compel a State to do exactly the same thing before the administrative tribunal of an agency, such as the FMC.  . . .The affront to a State's dignity does not lessen when an adjudication takes place in an administrative tribunal as opposed to an Article III court. In both instances, a State is required to defend itself in an adversarial proceeding against a private party before an impartial federal officer. Moreover, it would be quite strange to prohibit Congress from exercising its Article I powers to abrogate state sovereign immunity in Article III judicial proceedings but permit the use of those same Article I powers to create court-like administrative tribunals where sovereign immunity does not apply.

D

[22] The United States suggests two reasons why we should distinguish FMC administrative adjudications from judicial proceedings for purposes of state sovereign immunity. Both of these arguments are unavailing.

1

[23] The United States first contends that sovereign immunity should not apply to FMC adjudications because the Commission's orders are not self-executing. Whereas a court may enforce a judgment through the exercise of its contempt power, the FMC cannot enforce its own orders. Rather, the Commission's orders can only be enforced by a federal district court.

[24] The United States presents a valid distinction between the authority possessed by the FMC and that of a court. For purposes of this case, however, it is a distinction without a meaningful difference. To the extent that the United States highlights this fact in order to suggest that a party alleged to have violated the Shipping Act is not coerced to participate in FMC proceedings, it is mistaken. The relevant statutory scheme makes it quite clear that, absent sovereign immunity, States would effectively be required to defend themselves against private parties in front of the FMC.

[25] A State seeking to contest the merits of a complaint filed against it by a private party must defend itself in front of the FMC or substantially compromise its ability to defend itself at all.

2

[26] The United States next suggests that sovereign immunity should not apply to FMC proceedings because they do not present the same threat to the financial integrity of States as do private judicial suits. . . .

[27] Sovereign immunity does not merely constitute a defense to monetary liability or even to all types of liability. Rather, it provides an immunity from suit. The statutory scheme, as interpreted by the United States, is thus no more permissible than if Congress had allowed private parties to sue States in federal court for violations of the Shipping Act but precluded a court from awarding them any relief.

* * *

[28] While some might complain that our system of dual sovereignty is not a model of administrative convenience, that is not its purpose. Rather, "[t]he `constitutionally mandated balance of power' between the States and the Federal Government was adopted by the Framers to ensure the protection of `our fundamental liberties.' "By guarding against encroachments by the Federal Government on fundamental aspects of state sovereignty, such as sovereign immunity, we strive to maintain the balance of power embodied in our Constitution and thus to "reduce the risk of tyranny and abuse from either front." Although the Framers likely did not envision the intrusion on state sovereignty at issue in today's case, we are nonetheless confident that it is contrary to their constitutional design, and therefore affirm the judgment of the Court of Appeals.

[29] It is so ordered.


Justice Stevens, dissenting.

[1] I join [Justice Breyer’s] opinion without reservation, but add these words . . .

[ * * * ]

[2] [T]he Eleventh Amendment is best understood as having overruled Chisholm `s subject-matter jurisdiction holding, thereby restricting the federal courts' diversity jurisdiction. However, the Amendment left intact Chisholm `s personal jurisdiction holding: that the Constitution does not immunize States from a federal court's process. . . .


Justice Breyer, with whom Justice Stevens, Justice Souter, and Justice Ginsburg join, dissenting.

[1] The Court holds that a private person cannot bring a complaint against a State to a federal administrative agency where the agency (1) will use an internal adjudicative process to decide if the complaint is well founded, and (2) if so, proceed to court to enforce the law. Where does the Constitution contain the principle of law that the Court enunciates? I cannot find the answer to this question in any text, in any tradition, or in any relevant purpose. . . .

[2] At the outset one must understand the constitutional nature of the legal proceeding before us. . . .

[3] The Court long ago laid to rest any constitutional doubts about whether the Constitution permitted Congress to delegate rulemaking and adjudicative powers to agencies. . . . [I]n exercising those powers, the agency is engaging in an Article II, Executive Branch activity. And the powers it is exercising are powers that the Executive Branch of Government must possess if it is to enforce modern law through administration.

[4] [T]his case involves a typical Executive Branch agency exercising typical Executive Branch powers seeking to determine whether a particular person has violated federal law. The particular person in this instance is a state entity, the South Carolina State Ports Authority, and the agency is acting in response to the request of a private individual. But at first blush it is difficult to see why these special circumstances matter. After all, the Constitution created a Federal Government empowered to enact laws that would bind the States and it empowered that Federal Government to enforce those laws against the States. It also left private individuals perfectly free to complain to the Federal Government about unlawful state activity, and it left the Federal Government free to take subsequent legal action. Where then can the Court find its constitutional principle—the principle that the Constitution forbids an Executive Branch agency to determine through ordinary adjudicative processes whether such a private complaint is justified? As I have said, I cannot find that principle anywhere in the Constitution.

II

[5] The Court's principle lacks any firm anchor in the Constitution's text. The Eleventh Amendment cannot help. It says:

[6] "The Judicial power of the United States shall not . . . extend to any suit . . . commenced or prosecuted against one of the . . . States by Citizens of another State." (Emphasis added.)

[7] Federal administrative agencies do not exercise the "[j]udicial power of the United States." Compare Crowell v. Benson, 285 U. S. 22 (1932) (explaining why ordinary agency adjudication, with safeguards, is not an exercise of Article III power), with Freytag v. Commissioner, 501 U. S., at 890-891 (Tax Court, a special Article I court, exercises Article III power), and Williams v. United States, 289 U. S. 553, 565-566 (1933) (same as to Court of Claims). Of course, this Court has read the words "Citizens of another State" as if they also said "citizen of the same State." Hans v. Louisiana, 134 U. S. 1 (1890). But it has never said that the words "[j]udicial power of the United States" mean "the executive power of the United States." Nor should it.

[8] The Tenth Amendment cannot help. . . .

[9] Considered purely as constitutional text, these words— "constitutional design," "system of federalism," and "plan of the convention"—suffer several defects. Their language is highly abstract, making them difficult to apply. They invite differing interpretations at least as much as do the Constitution's own broad liberty-protecting phrases, such as "due process of law" or the word "liberty" itself. And compared to these latter phrases, they suffer the additional disadvantage that they do not actually appear anywhere in the Constitution.

III

[10] Conceding that its conception of sovereign immunity is ungrounded in the Constitution's text, the Court attempts to support its holding with history. But this effort is similarly destined to fail . . .

[11] [T]otal 18th-century silence about state immunity in Article I proceedings would argue against, not in favor of, immunity.

[12] In any event, the 18th century was not totally silent. The Framers enunciated in the "plan of the convention" the principle that the Federal Government may sue a State without its consent. They also described in the First Amendment the right of a citizen to petition the Federal Government for a redress of grievances. The first principle applies here because only the Federal Government, not the private party, can—in light of this Court's recent sovereign immunity jurisprudence—bring the ultimate court action necessary legally to force a State to comply with the relevant federal law. The second principle applies here because a private citizen has asked the Federal Government to determine whether the State has complied with federal law and, if not, to take appropriate legal action in court. Of course these two principles apply only through analogy. . . .

[13] This is not to say that the analogy (with a citizen petitioning for federal intervention) is, historically speaking, a perfect one. As the Court points out, the Framers may not have "anticipated the vast growth of the administrative state," and the history of their debates "does not provide direct guidance." But the Court is wrong to ignore the relevance and importance of what the Framers did say. And it is doubly wrong to attach "great" legal "significance" to the absence of 18th- and 19th-century administrative agency experience. Even if those alive in the 18th century did not "anticipat[e] the vast growth of the administrative state," they did write a Constitution designed to provide a framework for Government across the centuries, a framework that is flexible enough to meet modern needs. And we cannot read their silence about particular means as if it were an instruction to forbid their use.

V

[14] The Court cannot justify today's decision in terms of its practical consequences. The decision, while permitting an agency to bring enforcement actions against States, forbids it to use agency adjudication in order to help decide whether to do so. Consequently, the agency must rely more heavily upon its own informal staff investigations in order to decide whether a citizen's complaint has merit. The natural result is less agency flexibility, a larger federal bureaucracy, less fair procedure, and potentially less effective law enforcement.

[15] These consequences are not purely theoretical. The Court's decision may undermine enforcement against state employers of many laws designed to protect worker health and safety. And it may inhibit the development of federal fair, rapid, and efficient informal nonjudicial responses to complaints, for example, of improper medical care (involving state hospitals).

* * *

[16] The Court's decision threatens to deny the Executive and Legislative Branches of Government the structural flexibility that the Constitution permits and which modern government demands. The Court derives from the abstract notion of state "dignity" a structural principle that limits the powers of both Congress and the President. Its reasoning rests almost exclusively upon the use of a formal analogy, which, as I have said, jumps ordinary separation-of-powers bounds. It places "great significance" upon the 18th-century absence of 20th-century administrative proceedings. And its conclusion draws little support from considerations of constitutional purpose or related consequence. In its readiness to rest a structural limitation on so little evidence and in its willingness to interpret that limitation so broadly, the majority ignores a historical lesson, reflected in a constitutional understanding that the Court adopted long ago: An overly restrictive judicial interpretation of the Constitution's structural constraints (unlike its protections of certain basic liberties) will undermine the Constitution's own efforts to achieve its far more basic structural aim, the creation of a representative form of government capable of translating the people's will into effective public action.

[17] This understanding, underlying constitutional interpretation since the New Deal, reflects the Constitution's demands for structural flexibility sufficient to adapt substantive laws and institutions to rapidly changing social, economic, and technological conditions. It reflects the comparative inability of the Judiciary to understand either those conditions or the need for new laws and new administrative forms they may create. It reflects the Framers' own aspiration to write a document that would "constitute" a democratic, liberty protecting form of government that would endure through centuries of change. This understanding led the New Deal Court to reject overly restrictive formalistic interpretations of the Constitution's structural provisions, thereby permitting Congress to enact social and economic legislation that circumstances had led the public to demand. And it led that Court to find in the Constitution authorization for new forms of administration, including independent administrative agencies, with the legal authority flexibly to implement, i. e., to "execute," through adjudication, through rulemaking, and in other ways, the legislation that Congress subsequently enacted.

[18] . . . .These decisions set loose an interpretive principle that restricts far too severely the authority of the Federal Government to regulate innumerable relationships between State and citizen. Just as this principle has no logical starting place, I fear that neither does it have any logical stopping point.

[19] Today's decision reaffirms the need for continued dissent— unless the consequences of the Court's approach prove anodyne, as I hope, rather than randomly destructive, as I fear.