Barry v. Fordice, Civ. A. No. J92-0559(W)(C).

• Decision Date: 03 December 1992
• Docket Number: Civ. A. No. J92-0559(W)(C).
• Citation: 814 F. Supp. 511
• Parties: David J. BARRY, Donald J. Burns, Frederick P. Seabrook, and Michael R.F. Wilkins, Plaintiffs, v. Governor Kirk FORDICE, in his capacity as Chairman and Commissioner of the State Bond Retirement Commission and in his capacity as Commissioner of the State Bond Commission; Attorney General Mike Moore, in his capacity as Secretary and Commissioner of the State Bond Retirement Commission and in his capacity as Commissioner of the State Bond Commission; Treasurer Marshall Bennett, in his capacity as Commissioner of the State Bond Retirement Commission and in his capacity as Commissioner of the State Bond Commission; Auditor Steve Patterson, in his capacity as Advisor to the State Bond Commission; and Tax Commission Chairman Ed Buelow, Jr., in his capacity as Advisor to the State Bond Commission, Defendants.
• Court: U.S. District Court — Southern District of Mississippi

814 F. Supp. 511

David J. BARRY, Donald J. Burns, Frederick P. Seabrook, and Michael R.F. Wilkins, Plaintiffs, v. Governor Kirk FORDICE, in his capacity as Chairman and Commissioner of the State Bond Retirement Commission and in his capacity as Commissioner of the State Bond Commission; Attorney General Mike Moore, in his capacity as Secretary and Commissioner of the State Bond Retirement Commission and in his capacity as Commissioner of the State Bond Commission; Treasurer Marshall Bennett, in his capacity as Commissioner of the State Bond Retirement Commission and in his capacity as Commissioner of the State Bond Commission; Auditor Steve Patterson, in his capacity as Advisor to the State Bond Commission; and Tax Commission Chairman Ed Buelow, Jr., in his capacity as Advisor to the State Bond Commission, Defendants.

Civ. A. No. J92-0559(W)(C).

United States District Court, S.D. Mississippi, Jackson Division.

December 3, 1992.

Paul M. Neville, Jackson, MS, for plaintiffs.

T. Hunt Cole, Jr., Office of Atty. Gen., Jackson, MS, for defendants.

ORDER GRANTING DEFENDANTS' MOTION TO DISMISS FOR LACK OF JURISDICTION

WINGATE, District Judge.

Before the court is the motion of defendants, pursuant to Rule 12(b)(1)¹ of the Federal Rules of Civil Procedure, to dismiss this action for want of subject matter jurisdiction. Defendants contend that since the real substantial party in interest in this lawsuit is the State of Mississippi, the Eleventh Amendment² to the United States Constitution bars this action. Plaintiffs oppose the motion. Nevertheless, the court is persuaded by defendants' motion and hereby grants same for the reasons which follow.

I.

The complaint alleges that the plaintiffs are owners and/or holders of certain pre-Civil War bonds issued by the State of Mississippi, i.e., "Mississippi Planters Bank Bonds" and "Mississippi Union Bank Bonds." The plaintiffs, David J. Barry, Donald Burns, Frederick Seabrook, and Michael Williams, are citizens of Great Britain. The defendants are the following officers of the State of Mississippi: the Governor, the Attorney General, the Treasurer, the Auditor, and the Tax Commission Chairman. All defendants are sued in their official capacities.

The complaint alleges that the bonds are unpaid and past due by the State of Mississippi and that the sum of $11,322,990.00 is currently due.³ The complaint further alleges that payment has been demanded and refused and that state enactments and § 258⁴ of the Mississippi Constitution (1890) prevent the payment by Mississippi on the aforementioned bonds. The complaint contends that this legislated and constitutionally-barred non-payment violates various federal constitutional provisions and statutes, namely, Article VI, Clause 2, of the Constitution of the United States of America; Article I, Section X, Clause 1, of the Constitution of the United States of America; Article I, Section IX, Clause 3, of the Constitution of the United States of America; Amendment V to the Constitution of the United States of America; Amendment XIV to the Constitution of the United States of America; Article 10 and Article 28 of the Treaty of Amity, Commerce and Navigation between the United States of America and Great Britain entered into force on October 28, 1795, and Title 42 U.S.C. § 1981, § 1983 and other unspecified statutory enactments of the United States Congress. Accordingly, pursuant to federal question jurisdiction, 28 U.S.C. § 1331,⁵ and federal diversity jurisdiction, 28 U.S.C. § 1332,⁶ the plaintiffs seek declaratory and injunctive relief which would require the defendants to honor the bonds and permit the plaintiffs to recover monetary judgment for all damages allowed by law.

II.

As above stated, the defendants contend that the real party in interest here is the State of Mississippi and that the ultimate goal of the plaintiffs is to recover payment on these bonds. Since the State of Mississippi has not permitted this lawsuit, say defendants, this lawsuit falls under the strictures of the Eleventh Amendment to the United States Constitution which bar this action. Defendants cite the cases of Cory v. White, 457 U.S. 85, 90-91, 102 S.Ct. 2325, 2328-29, 72 L.Ed.2d 694 (1982) (the Eleventh Amendment does not only bar claims of monetary relief asserted against the state, relief of an equitable nature may also be barred); Edelman v. Jordan, 415 U.S. 651, 661-669, 94 S.Ct. 1347, 1355-1359, 39 L.Ed.2d 662 (1974) (the Eleventh Amendment bars any suit which would have the effect of imposing retroactive monetary liability against the state treasury); Parden v. Terminal Ry., 377 U.S. 184, 187, 84 S.Ct. 1207, 1210, 12 L.Ed.2d 233 (1963) ("a suit on state debt obligations, without the state's consent, was precisely the `evil' against which both the Eleventh Amendment and the expanded immunity doctrine of Hans v. Louisiana, 134 U.S. 1, 10 S.Ct. 504, 33 L.Ed. 842 (1890) were directed.").

The plaintiffs do not quarrel with the defendants' authority, nor with the defendants' view of the law. Plaintiffs simply say that this body of law does not apply to the thrust of their complaint. Citing Fletcher v. Peck, 10 U.S. 87, 6 Cranch 87, 3 L.Ed. 162 (1810); Ex parte Young, 209 U.S. 123, 28 S.Ct. 441, 52 L.Ed. 714 (1908); Edelman v. Jordan, 415 U.S. 651, 94 S.Ct. 1347, 39 L.Ed.2d 662 (1974); and Brennan v. Stewart, 834 F.2d 1248 (5th Cir.1988), plaintiffs argue that since their complaint only aims to adjudicate the constitutionality of certain state statutes and state constitutional provisions which presently forbid the State of Mississippi from paying the bonds, their contentions are beyond the scope of the Eleventh Amendment.

III.

A federal district court is under an initial obligation to review the allegations of a complaint to determine if the court's jurisdiction over the suit is barred by the Eleventh Amendment. Pennhurst State School & Hospital v. Halderman, 465 U.S. 89, 121, 104 S.Ct. 900, 919, 79 L.Ed.2d 67 (1984). Like other types of immunities which provide a defense of suit, the Eleventh Amendment immunity of a state is a threshold matter that must be addressed prior to the "merits" of the suit, and any order regarding such an Eleventh Amendment issue is immediately appealable. Loya v. Texas Department of Corrections, 878 F.2d 860 (5th Cir.1989).⁷

IV.

Under the Eleventh Amendment, suits against non-consenting states by their own citizens, by citizens of another state, by citizens of foreign states, or by a foreign nation are prohibited. Principality of Monaco v. Mississippi, 292 U.S. 313, 329-331, 54 S.Ct. 745, 750-751, 78 L.Ed. 1282 (1934); Hughes v. Savell, 902 F.2d 376, 377 (5th Cir.1990); Pennhurst II, 465 U.S. at 97-98, 104 S.Ct. at 906-907. In Pennhurst II, the Supreme Court stated:

That a State may not be sued without its consent is a fundamental rule of jurisprudence having so important a bearing upon the construction of the Constitution of the United States that it has become established by repeated decisions of this court that the entire judicial power granted by the Constitution does not embrace authority to entertain a suit brought by private parties against a State without consent given: not one brought by citizens of another State, or by citizens or subjects of a foreign State, because of the Eleventh Amendment; and not even one brought by its own citizens, because of the fundamental rule of which the Amendment is but an exemplification.

465 U.S. at 99, 104 S.Ct. at 907, quoting Ex parte State of New York No. 1, 256 U.S. 490, 497, 41 S.Ct. 588, 589, 65 L.Ed. 1057 (1921) (emphasis in original). The Eleventh Amendment is an "explicit limitation" on the jurisdiction of the Court and serves as "a specific constitutional bar against hearing even federal claims that otherwise would be within the jurisdiction of the federal courts." 465 U.S. at 119-120, 104 S.Ct. at 918.⁸

The Eleventh Amendment bar is not limited to suits seeking monetary relief, it may also bar suits seeking equitable relief. Cory v. White, 457 U.S. 85, 90-91, 102 S.Ct. 2325, 2328-2329, 72 L.Ed.2d 694 (1982); Pennhurst II, 465 U.S. at 100-101, 104 S.Ct. at 908 (the "jurisdictional bar applies regardless of the relief sought"). Moreover, the Eleventh Amendment also prohibits suits that are nominally against state officials in their official, rather than personal, capacities, where, in fact, the state is the "real substantial party in interest." Ford Motor Co. v. Dept. of Treasury, 323 U.S. 459, 464, 65 S.Ct. 347, 350, 89 L.Ed. 389 (1945); Hughes v. Savell, 902 F.2d at 377-378. As stated in Ford Motor Co. v. Department of Treasury, 323 U.S. 459, 65 S.Ct. 347, 89 L.Ed. 389 (1945), under this principle, the Eleventh Amendment therefore bars a suit against state officers who are "joined as collective representatives of the state, not as individuals against whom a personal judgment is sought." 323 U.S. at 463-464, 65 S.Ct. at 350.

When the action is in essence one for the recovery of money from the State, the State is the real substantial party in interest, and is entitled to invoke its sovereign immunity from suit even though individual officials are nominal defendants.

Ford Motor Co. v. Department of Treasury, 323 U.S. at 463-464, 65 S.Ct. at 350; also see Hughes, 902 F.2d at 378. "The State is the real party in interest if the decision rendered in a case would operate against the sovereign, expending itself on the public treasury, interfering with public administration, or compelling the State to act or refrain from acting." Pennhurst II, 465 U.S. at 101, 104 S.Ct. at 908. The Eleventh Amendment thus bars any suit which would have the effect of imposing retroactive monetary liability against a state's treasury.⁹ Edelman v. Jordan, 415 U.S. 651, 661-669, 94 S.Ct. 1347, 1354-1359, 39 L.Ed.2d 662 (1974) (noting, inter alia, that the Eleventh Amendment barred a claim which resulted from a past breach of legal duty on the part of state officials); Bullock v. Reed,...