Maliandi v. Montclair State Univ., No. 14-3812

• Court: United States Courts of Appeals. United States Court of Appeals (3rd Circuit)
• Writing for the Court: KRAUSE, Circuit Judge.
• Citation: 845 F.3d 77,33 A.D. Cases 237
• Docket Number: No. 14-3812
• Decision Date: 27 December 2016
• Parties: Paula MALIANDI v. MONTCLAIR STATE UNIVERSITY, Appellant

845 F.3d 77
33 A.D. Cases 237

Paula MALIANDI
v.
MONTCLAIR STATE UNIVERSITY, Appellant

No. 14-3812

United States Court of Appeals, Third Circuit.

Argued: April 4, 2016
Opinion filed: December 27, 2016

Jennifer J. McGruther, Esq. (Argued), Office of Attorney General of New Jersey, Department of Law & Public Safety, Division of Law, Richard J. Hughes Justice Complex, 25 Market Street, P.O. Box 112, Trenton, NJ 08625, Counsel for Appellant

Michael R. DiChiara, Esq. (Argued), Krakower DiChiara, 77 Market Street, Suite 2, Park Ridge, NJ 07656, Counsel for Appellee

Before: AMBRO, KRAUSE, Circuit Judges, and THOMPSON,^* District Judge

OPINION OF THE COURT

KRAUSE, Circuit Judge.

Our federalist system of government accords respect for the sovereignty of the States in a variety of ways, including the Eleventh Amendment to the United States Constitution, which immunizes States from suits brought in federal court by both their own citizens and citizens of other States. The Eleventh Amendment's protection, however, is not limited to the States alone, but rather extends to entities that function as "arms of the State." In this case, we are asked to resolve a split among the district courts in our Circuit as to whether Montclair State University ("MSU") is an arm of the State of New Jersey, which would render it immune from the discrimination suit brought by Appellee Paula Maliandi. Applying the balancing test we have developed to make such determinations, we conclude that, while a close case, MSU is an arm of the State, thus affording it access to the refuge of the Eleventh Amendment. Accordingly, we will reverse the decision of the District Court and remand for proceedings consistent with this opinion.

I. Background

According to her complaint, Paula Maliandi began working for MSU in November 2007 and took medical leave for breast cancer treatment in early 2013. Despite having complied with all pertinent policies and procedures for taking such leave, Maliandi allegedly was denied her original position when she returned and instead was offered an inferior position, which she declined. She was subsequently terminated. Maliandi then filed suit against MSU for wrongful termination, seeking money damages and equitable relief under both federal and state law. Maliandi's federal claim arises under the Family Medical Leave Act ("FMLA") for termination on account of a "serious [health] condition." While she does not cite a specific provision in her complaint, it would appear her claim is rooted in the so-called "self-care provision," 29 U.S.C. § 2612(a)(1)(D), and its corresponding retaliation provision, 29 U.S.C. § 2614(a). Together, these provisions entitle a qualifying employee to twelve weeks of leave for a "serious health condition" and require an employer to restore an employee who took leave under

845 F.3d 82

§ 2612 to her prior position or an equivalent one upon her return. Maliandi's state law claim arises under the New Jersey Law Against Discrimination ("NJLAD"), N.J. Stat. Ann. §§ 10:5–1 to –49, which, among other things, prohibits discrimination on account of a disability or handicap.

MSU moved to dismiss Maliandi's complaint under Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction based on its contention that, as an arm of the State, it is owed Eleventh Amendment immunity from suit in federal court.¹ The District Court denied the motion, determining that MSU is not the State's alter ego and, in turn, concluding that MSU is subject to suit in federal court for both the federal and state law claims.² MSU appeals.

The District Court had jurisdiction under 28 U.S.C. § 1331 to adjudicate Maliandi's FMLA claim and under 28 U.S.C. § 1367 to consider her associated state law claim. The District Court's order denying MSU's 12(b)(1) motion to dismiss on Eleventh Amendment immunity grounds is immediately appealable under the collateral order doctrine, imbuing us with jurisdiction under 28 U.S.C. § 1291. Cooper v. Se. Pa. Transp. Auth. , 548 F.3d 296, 298 (3d Cir. 2008) (citing P.R. Aqueduct & Sewer Auth. v. Metcalf & Eddy, Inc. , 506 U.S. 139, 144–45, 113 S.Ct. 684, 121 L.Ed.2d 605 (1993) ). We consider whether MSU is owed Eleventh Amendment immunity de novo ; as "the party asserting immunity," MSU "bears the burden of production and persuasion." Febres v. Camden Bd. of Educ. , 445 F.3d 227, 228–29 (3d Cir. 2006).

II. Discussion

Our Eleventh Amendment jurisprudence has wound its way through a number of variations—both subtle and significant—over the past decades. To distill the principles that govern our analysis today, we first review the constitutional underpinnings and precedent relevant to the arm of the State inquiry, and we then apply those

845 F.3d 83

principles to determine whether MSU qualifies as an arm of the State entitled to immunity.

A. History and Precedent

The Eleventh Amendment began as a simple rebuke of the Supreme Court's decision in Chis h olm v. Georgia , 2 U.S. 419, 2 Dall. 419, 1 L.Ed. 440 (1793), that would have subjected States to suits in federal court and saddled them with the weight of the burgeoning republic's Revolutionary War debts. Hans v. Louisiana , 134 U.S. 1, 10–11, 10 S.Ct. 504, 33 L.Ed. 842 (1890) ; see also Hess v. Port Auth. Trans-Hudson Corp. , 513 U.S. 30, 39, 115 S.Ct. 394, 130 L.Ed.2d 245 (1994). More than two centuries later, however, it has evolved into a potent tool for States to ensure that States retain their sovereignty and integrity as constituent polities of our national government. Hess , 513 U.S. at 39–40, 115 S.Ct. 394. Thus, the Supreme Court has recognized that the Amendment does not merely shield state treasuries. Instead, it advances two fundamental goals: safeguarding States' dignity and protecting their financial solvency. Id. at 52, 115 S.Ct. 394. And although, by its terms, the Eleventh Amendment only withholds from the federal judiciary the power to decide cases brought against a State by a citizen of another State or a foreign government, U.S. Const. amend. XI, the Court has interpreted it to bar suits against a State by its own citizens—not just those from other jurisdictions. Hans , 134 U.S. at 10–15, 10 S.Ct. 504 ; see also Seminole Tribe of Fla. v. Florida , 517 U.S. 44, 54, 116 S.Ct. 1114, 134 L.Ed.2d 252 (1996).

Importantly for this case, the Court also has read the Amendment to bar not only suits against States themselves, but also suits for damages against "arms of the State"—entities that, by their very nature, are so intertwined with the State that any suit against them renders the State the "real, substantial party in interest." Edelman v. Jordan , 415 U.S. 651, 663, 94 S.Ct. 1347, 39 L.Ed.2d 662 (1974) (quoting Ford Motor Co. v. Dep't of Treasury , 323 U.S. 459, 464, 65 S.Ct. 347, 89 L.Ed. 389 (1945) ); see also Mt. Healthy City Sch. Dist. Bd. of Educ. v. Doyle , 429 U.S. 274, 280, 97 S.Ct. 568, 50 L.Ed.2d 471 (1977) (using the term "arm of the State"); Febres , 445 F.3d at 229.

Because the Eleventh Amendment provides the States with sweeping immunity from suit, we have been careful to ensure that its reach does not extend beyond proper bounds. Accordingly, we employ a fact-intensive, three-step balancing test to ascertain whether a state-affiliated entity is an "arm of the State" that falls within the ambit of the Eleventh Amendment. Our initial recitation of the test came in Urbano v. Board of Managers , 415 F.2d 247, 250–51 (3d Cir. 1969), cert. denied , 397 U.S. 948, 90 S.Ct. 967, 25 L.Ed.2d 128 (1970), where we identified nine factors to consider. Two decades later in Fitchik v. New Jersey Transit Rail Operations, Inc. , 873 F.2d 655, 659 (3d Cir. 1989) (en banc), we attempted to consolidate those Urbano factors into a more manageable three-factor test that still governs today.

As explained in more detail below, the Fitchik factors are (1) the funding factor: whether the state treasury is legally responsible for an adverse judgment entered against the alleged arm of the State; (2) the status under state law factor: whether the entity is treated as an arm of the State under state case law and statutes; and (3) the autonomy factor: whether, based largely on the structure of its internal governance, the entity retains significant autonomy from state control. Id. Because, for the most part, we did not

845 F.3d 84

disagree with the Urbano factors,³ but rather organized them under the headings of Fitchik 's three factors, the layers of factors, subfactors, and considerations that inform those subfactors can still make an analysis seem dense, if not impenetrable. Moreover, each step of that analysis is a "fact-intensive" undertaking that requires a fresh analysis and "individualized determinations" for each entity claiming Eleventh Amendment immunity. See Bowers v. Nat'l Collegiate Athletic Ass'n , 475 F.3d 524, 546 (3d Cir. 2007).

After identifying the direction in which each factor points, we balance them to determine whether an entity amounts to an arm of the State. Fitchik , 873 F.2d at 664 ; see also Cooper , 548 F.3d at 311. While our jurisprudence had long afforded the first factor—state funding—more weight than the others, see...