Galette v. New Jersey Transit (Sovereign Immunity)

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In 1979, the New Jersey Legislature created the New Jersey Transit Corporation (NJ Transit) as a “body corporate and politic with corporate
succession” and constituted it as an “instrumentality of the State exercising public and essential governmental functions” but “independent of any supervision or control” by the New Jersey Department of
Transportation. N. J. Stat. §27:25–4(a). The State gave NJ Transit
significant authority, including the power to make bylaws, sue and be
sued, make contracts, acquire property, raise funds, own corporate entities, adopt regulations, and exercise eminent domain powers.
§§27:25–5, 27:25–13. NJ Transit’s organic statute provides that “[n]o
debt or liability of the corporation shall . . . constitute a debt [or] liability of the State,” and that “[a]ll expenses . . . shall be payable from
funds available to the corporation.” §27:25–17. NJ Transit is governed
by a board of directors (Board). §27:25–4(b). The Governor may remove Board members and may veto Board actions; the Legislature
may veto some eminent domain actions. §§27:25–4(b), (f); §27:25–
13(h). NJ Transit is now the third largest provider of bus, rail, and
light rail transit, operating within an area that includes New Jersey,
New York City, and Philadelphia.

In 2017, Jeffrey Colt was struck by an NJ Transit bus in Midtown
Manhattan; a year later, Cedric Galette was injured when an NJ
Transit bus crashed into a car in which he was a passenger in Philadelphia. Both sued NJ Transit for negligence in their respective home
state courts. NJ Transit moved to dismiss both lawsuits, arguing that
it is an arm of New Jersey entitled to sovereign immunity. The New York Court of Appeals held that NJ Transit is not an arm of New Jersey; the Pennsylvania Supreme Court held the opposite, concluding NJ
Transit is an arm of New Jersey. This Court consolidated the cases
and granted certiorari to resolve the conflict.
Held: NJ Transit Corporation is not an arm of New Jersey and thus is
not entitled to share in New Jersey’s interstate sovereign immunity.

Read by Attorney Jake Leahy.