Enrique Molina-Estrada v. Puerto Rico Highway Authority, MOLINA-ESTRADA

Decision Date08 June 1982
Docket NumberMOLINA-ESTRADA,No. 81-1447,81-1447
Citation680 F.2d 841
Parties25 Wage & Hour Cas. (BN 685, 94 Lab.Cas. P 34,198 ENRIQUE, et al., Plaintiffs, Appellants, v. PUERTO RICO HIGHWAY AUTHORITY, Defendant, Appellee.
CourtU.S. Court of Appeals — First Circuit

Nicolas Delgado Figueroa, Santurce, P. R., for plaintiffs, appellants.

Lorraine Riefkohl de Lopez, Asst. Sol. Gen., Dept. of Justice, San Juan, P. R., with whom Hector A. Colon Cruz, Sol. Gen., San Juan, P. R., was on brief, for defendant, appellee.

Before GIBSON, * BOWNES and BREYER, Circuit Judges.

BREYER, Circuit Judge.

Appellants are "irregular employees" of the defendant, the Puerto Rico Highway Authority. They work on highway construction projects and "highway upkeep." They sued the Authority for additional wages that they believe were owed to them under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201 et seq., or the Davis-Bacon Act, 40 U.S.C. § 276a et seq. (applied through the Federal Aid Highway Act of 1956, 23 U.S.C. § 113(a)). The district court dismissed their complaint on two grounds. First, it viewed the Authority as the alter ego of the Commonwealth itself. It consequently considered the suit barred by the Eleventh Amendment to the Constitution. ("The Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, ...") The constitutional principle underlying the Eleventh Amendment also forbids a state's own citizens to bring against it in federal court an unconsented suit for damages. See Hans v. Louisiana, 134 U.S. 1, 10 S.Ct. 504, 33 L.Ed. 842 (1890); Employees v. Department of Health and Welfare of Missouri, 411 U.S. 279, 280, 93 S.Ct. 1614, 1615, 36 L.Ed.2d 251 (1973); Ezratty v. Commonwealth of Puerto Rico, 648 F.2d 770, 776 n.7 (1st Cir. 1981) (principles underlying the Eleventh Amendment are applicable to Puerto Rico). Second, it considered the Authority to be engaged in "integral operations in areas of traditional governmental functions" and therefore immune from federal "minimum wage" regulation under the principle of National League of Cities v. Usery, 426 U.S. 833, 852, 96 S.Ct. 2465, 2474, 49 L.Ed.2d 245 (1976).

In this court the appellants argue only one issue: whether the Authority's statutory powers to operate a mass transportation system, rent parking lots, and charge a fee for the use of its highways, place it outside the National League of Cities principle. Their brief, in its statement of issues, refers to "jurisdiction" and the Davis-Bacon Act, but it makes no Davis-Bacon Act or Federal Aid Highway Act argument. It argues only whether the Puerto Rico Highway Authority "is acting as a private corporation and should be treated as such."

Before approaching that issue, however, we consider as a preliminary matter the Authority's claim that we ought not to reach the National League of Cities question. In the Authority's view, a suit against it is barred by the Eleventh Amendment and related sovereign immunity doctrine. This question is difficult. The Supreme Court has specifically held that a state can assert an Eleventh Amendment-type defense to an FLSA suit, but its holding seems based in part on its conclusion that Congress had not shown in the statute a specific intent that the state's sovereign immunity be "waived" (i.e., overridden). Employees v. Department of Public Health and Welfare of Missouri, 411 U.S. at 283-85, 93 S.Ct. at 1617-18. Congress responded to the Employees opinion by enacting a statute specifically seeking to override the states' sovereign immunity. Fair Labor Standards Amendments of 1974, Pub.L.No. 93-259, § 6(d) (1), 88 Stat. 55 (amending 29 U.S.C. § 216); see 29 U.S.C.A. § 216 (Supp.1982). See also H.R.Rep. No. 913, 93d Cong., 2d Sess., reprinted in (1974) U.S.Code Cong. & Ad. News 2811, 2853; cf. Dunlop v. State of New Jersey, 522 F.2d 504, 514 n.20 (3d Cir. 1975), vacated and remanded for consideration of National League of Cities sub nom. New Jersey v. Usery, 427 U.S. 909, 96 S.Ct. 3196, 49 L.Ed.2d 1202 (1976). Thus, the Authority in effect would have us deal with the disputed question of the extent to which Congress can force a state, against its will, to be sued in a federal court by one of its citizens (or by a citizen of another state). See generally Tribe, Intergovernmental Immunities in Litigation, Taxation and Regulation: Separation of Powers Issues in Controversies About Federalism, 89 Harv.L.Rev. 682 (1976); Field, The Eleventh Amendment and Other Sovereign Immunity Doctrines: Congressional Impositions of Suit Upon the States, 126 U.Pa.L.Rev. 1203 (1978). But see P. Bator, P. Mishkin, D. Shapiro & H. Wechsler, Hart & Wechsler's The Federal Courts and the Federal System 231-32 (2d ed. Supp. 1981); Employees v. Department of Public Health and Welfare of Missouri, 411 U.S. at 292-93 n.8, 93 S.Ct. at 1621-22 n.8 (Justice Marshall, concurring in result).

We do not decide this question, however, and turn instead to the National League of Cities issue for several reasons. First, although the Authority does not address the matter, its authorizing statute specifically states that the Authority can be sued "in all courts of justice." 9 L.P.R.A. § 2004(g). (Emphasis supplied.) Since Puerto Rico has a unified court system with only one court of general jurisdiction, see Trias Monge, El sistema judicial de Puerto Rico 132 et seq. (1978); N. M. de Munoz Amato, Problemas administrativos en el poder judicial de Puerto Rico 40-41 (1964); Clark & Rogers, The New Judiciary Act of Puerto Rico: A Definitive Court Reorganization, 61 Yale L.J. 1147 (1952), this language sounds as if the Commonwealth has itself waived its sovereign immunity through "consent." Cf. Florida Department of Health and Rehabilitative Services v. Florida Nursing Home Association, 450 U.S. 147, 101 S.Ct. 1032, 67 L.Ed.2d 132 (1981); Edelman v. Jordan, 415 U.S. 651, 94 S.Ct. 1347, 39 L.Ed.2d 662 (1974) (waiver is to be found only where stated "by the most express language or by such overwhelming implications from the text as (will) leave no room for any other reasonable construction"). Be that as it may, to decide the Eleventh Amendment issue is likely to require a decision upon the basic National League of Cities question in any event. This is so because the Eleventh Amendment issue here is likely to turn upon the probability that, at a minimum, Congress lacks the power to override state sovereign immunity where it lacks the substantive power to impose federal standards upon the state. Tribe, American Constitutional Law 141 (1978). To decide the Eleventh Amendment question then would not save judicial resources. And, since the parties have not briefed these issues in any depth, it is simpler and more efficient to proceed directly to the National League of Cities question, which, in any event, leads to dismissal of this suit.

The main issue in this case is whether the Authority's activities constitute "traditional governmental functions." In National League of Cities the Supreme Court held that Congress lacked the power under the Commerce Clause of the Federal Constitution, Art. I, § 8, cl. 3-read in light of the Tenth Amendment (which reserves undelegated powers "to the States respectively or to the people")-to apply the FLSA to certain "public agencies." Recently, in United Transportation Union v. Long Island R.R., --- U.S. ----, ----, 102 S.Ct. 1353, 1349, 71 L.Ed.2d 547 (1982), a unanimous Supreme Court described its holding in National League of Cities as follows:

(W)e held that Congress could not impose the requirements of the Fair Labor Standards Act on state and local governments.... Prior to 1974, the Act excluded most governmental employers. However, in that year Congress amended the law to extend its provisions in somewhat modified form to "public agencies," including state governments and their political subdivisions. We held that the 1974 amendments were invalid "insofar as (they) operate to directly displace the States' freedom to structure integral operations in areas of traditional governmental functions...." 426 U.S. at 852, 96 S.Ct. at 2474. (Emphasis supplied.)

In National League of Cities itself, the Court explained the notion of "traditional governmental functions," when it wrote of its concern about the impact of the FLSA on "the States' abilities to structure employer-employee relationships in such areas as fire prevention, police protection, sanitation, public health, and parks and recreation." 426 U.S. at 851, 96 S.Ct. at 2474. The Court noted that "(t)hese activities are typical of those performed by state and local governments in discharging their dual functions of administering the public law and furnishing public services." Id. And, it added that "(t)hese examples are obviously not an exhaustive catalogue of the numerous line and support activities which are well within the area of traditional operations of state and local governments." 426 U.S. at 851 & n.16, 96 S.Ct. at 2474 & n.16.

We are also helped by considering cases in lower courts. Instances in which a function has been considered "integral" or "traditional" include, e.g., public schools and hospitals, Williams v. Eastside Mental Health Center, Inc., 669 F.2d 671, 677-78 (11th Cir. 1982); solid waste disposal, Hybud Equipment Corp. v. City of Akron, Ohio, 654 F.2d 1187, 1196, --- U.S. ----, 102 S.Ct. 1416, 71 L.Ed.2d 640 (6th Cir. 1981), vacated and remanded on other grounds, (1982); operation of a municipal airport, Amersbach v. City of Cleveland, 598 F.2d 1033 (6th Cir. 1979); health care of the aged and sick, NLRB v. Highview, Inc., 590 F.2d 174, 178, vacated in part on other grounds, 595 F.2d 339 (5th Cir. 1979); state licensing of automobile drivers, United States v. Best, 573 F.2d 1095, 1103 (9th Cir. 1978); the state legislature's adoption of rules for internal...

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    ...Equipment Corp. v. City of Akron, 654 F.2d 1187, 1196 (CA6 1981); and operating a highway authority, Molina-Estrada v. Puerto Rico Highway Authority, 680 F.2d 841, 845-846 (CA1 1982), are functions protected under National League of Cities. At the same time, courts have held that issuance o......
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