The American Jobs Act exposes states to frivolous lawsuits while providing a boon to trial lawyers seeking government settlement money. The President made no mention of this boon to the trial bar in his national jobs speech. Nor does the glossy overview of the American Jobs Act (Act) on the Whitehouse website mention this gift. Instead, one must delve deep within the bill to perceive this threat to state governments– 376 sections into it to be exact.
Section 376 of the Act guts the Eleventh Amendment of the Constitution by requiring states to forfeit their sovereign immunity rights guaranteed by this Amendment upon receipt of certain government funds. This opens the door for expensive litigation against states. Such litigation is a boon for trial lawyers but serves as a millstone around the neck of drowning taxpayers.
The Eleventh Amendment of the United States Constitution states:
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, or by Citizens or Subjects of any Foreign State.
The Supreme Court held in 1890 that this amendment prohibits suits brought against a state by its own citizens as well as from citizens of other states. (Hans v. Louisiana,134 U.S. 1 (1890)). Without this doctrine of sovereign immunity, lawsuits brought by private individuals could result in states being forced to pay monetary damages for alleged violations. People with valid claims against the State would not be the only ones collecting monetary damages. As those experienced in trial law will attest, settlements are often paid out to those launching lawsuits even when the merits of the case are questionable. Settling a case in many situations is simply less expensive than paying exorbitant legal defense costs.
This doctrine of sovereign immunity does NOT eliminate recourse by citizens for constitutional rights violations committed by a state government. Lawsuits may still be brought in an effort to prevent the States from continuing conduct which violates such rights. Courts can then order the state to alter its actions. Those who ratified Amendment XI recognized that courts should be in the business providing constitutional guidance rather than transferring public funds to individual litigants. After all, those public funds are derived ultimately from individual citizens.
So, how does the President’s jobs bill view this important amendment of our Constitution? With disdain. Section 376 states, in part:
(a) Abrogation of State Immunity- A State shall not be immune under the 11th Amendment to the Constitution from a suit brought in a Federal court of competent jurisdiction for a violation of this act…
(b)(1)(A) WAIVER- A State’s receipt or use of Federal financial assistance for any program or activity of a State shall constitute a waiver of sovereign immunity under the 11th Amendment of the Constitution or otherwise, to a suit brought by an employee or applicant for employment of that program or activity under this Act…
(d) …..Notwithstanding any other provision of this Act,… remedies (including remedies at law and in equity) are available for the violation to the same extent as such remedies would be available against a non-governmental entity.
Can you hear the chorus of trial attorneys chanting “Pass this bill”? Democratic politicians will be tempted to listen. After all, the American Association for Justice (formerly the Association of Trial Lawyers of America) gives millions to political campaigns–97% of these donations go to Democrats. Forcing states to forfeit their constitutional protections in exchange for federal funds comes at taxpayer expense. As with the ObamaCare bill, pausing to READ the bill rather the simply passing it would alert Congress and the public to the special interest bonanza represented within.