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05/16/2019

Is the Hyatt Decision Bad Originalism?
Michael Ramsey

Earlier this week the Supreme Court ruled, in Franchise Tax Board v. Hyatt, that as a constitutional matter states have sovereign immunity in the courts of other states.  Justice Thomas wrote the majority opinion (joined by Roberts, Alito, Gorsuch and Kavanaugh), relying on originalist arguments.

The decision has been widely criticized on originalist/textualist grounds -- for example, Stephen Sachs at Volokh Conspiracy, Hyatt, the Constitution, and the Common Law; Richard Re at SCOTUSBlog, Hyatt fulfills expectations in a surprising way; and Howard Wasserman at PrawfsBlawg, SCOTUS overrules more precedent, no textual support to be found.  Professor Sachs says: 

My worry is that a decision like this one, which attributes implicit rules to the Constitution that no one at the Founding seems to have found there, does more to bring careful methodology into disrepute than a variety of less serious errors that courts might make.

I would like to be contrarian and defend the Court's reasoning but ... I can't.  As others have written (so I will only summarize) the opinion seems problematic on two grounds.

First, it lacks a textual foundation.  Many people (including Professor Wasserman) say the same about the Court's state sovereign immunity jurisprudence more broadly, but that isn't so.  State sovereign immunity in federal court rests on a narrow reading of the federal courts' "judicial Power" vested by Article III, Section 1.  And even Alden v. Maine (state sovereign immunity for federal claims in state court), the textually most dubious of the lot, rests on a narrow reading of the necessary and proper clause.  True, in these cases structural intuitions and historical background do all the interpretive work, but ultimate the work they do is to reach a narrow reading of text.  In Hyatt there is truly no text. Of course (as argued many times on this blog) originalism is not necessarily textualism.  But if originalism isn't based on text, it has to be based on something else from the founding era, like commentary from the founders.  Otherwise it is not really originalism; it's just the judges' structural intuitions.

Second, Hyatt overrules a prior case, Nevada v. Hall.  Originalism lacks a theory of stare decisis (or rather, it has many inconsistent theories).  But whatever the correct full theory, at minimum it seems that a prior decision should not be overruled unless there are good reasons to believe it is wrong on originalist grounds.  Even if there are some reasons to think the Hyatt outcome might be right on originalist grounds, they do not seem clear enough to meet such a higher standard.  In particular, the lack of a textual foundation is problematic -- even if one thinks a textual foundation is not always required -- in such a situation.

A few further thoughts: 

(1) I don't see the opinion (as some critics have) as evidence that supposedly originalist Justices will do anything to reach a favored result.  Rather, I think the problem is that the Justices did not recognize how this case is different from other state sovereign immunity cases.  They thought (a) state sovereign immunity is a constitutional principle, as established in many prior cases; (b) Nevada v. Hall is a weird exception to that principle; (c) the Hall exception is especially odd because states actually would be better off in federal court (where they have constitutional sovereign immunity) than in the courts of another state; so (d) Nevada v. Hall is wrong.  But unlike the other  sovereign immunity cases, Hyatt is not about limiting the federal government's intrusions on the states. Rather, it is actually a limitation on states -- a limitation on the power of state courts to hear cases against other states. So the question in Hyatt is not whether the Constitution granted a federal power that did not previously exist (as it is in all other sovereign immunity cases).  The question is whether the Constitution limited a state power that did previously exist.  (True, it wasn't a power recognized by international law or common law, but it was a power that could be claimed by state statute.)  There are substantial reasons to distinguish between the two.  It is much more likely (in the absence of constitutional text to the contrary) that the Constitution left state powers as they were.

(2)  Co-blogger Andrew Hyman, who is more sympathetic to Hyatt than I am, notes that Rehnquist, dissenting in Nevada v. Hall argued:

the States that ratified the Eleventh Amendment thought that they were putting an end to the possibility of individual States as unconsenting defendants in foreign jurisdictions, for...they would have otherwise perversely foreclosed the neutral federal forums....

He (Andrew) adds:

Indeed, rendering the 11th Amendment absurd seems like a very good reason to disagree with the opinion that the Court overturned this week.  I was kind of surprised that the Court this week didn’t mention this implication that’s located in the text of the 11th Amendment.

I agree this is a better textual argument than the Hyatt majority's.  But I am not persuaded.  States may well have thought that judgments from the new federal courts were more of a threat than judgments from the courts of other states (which would be less likely -- being subject to retaliation -- and much harder to enforce).

(3) Among other things, the Hyatt majority argues: 

In short, at the time of the founding, it was well settled that States were immune under both the common law and
the law of nations. The Constitution’s use of the term “States” reflects both of these kinds of traditional immunity. And the States retained these aspects of sovereignty, “except as altered by the plan of the Convention or certain constitutional Amendments.” Alden, 527 U. S., at 713.

The idea that the Constitution's term "States" implies certain constitutional sovereign rights of the states is, I believe, originally the suggestion of my colleague and co-blogger Mike Rappaport, in an article from long ago (not cited by the Court).  I agree with his basic proposition but I don't think it works here.  The conclusion, I think, should be that the Constitution left state sovereignty as it was before the Constitution (except where the text altered it).  Indeed, this seems to be what the majority is saying in the quoted passage.  But if state sovereignty stayed the same as it had been before the Constitution, that means that state sovereign immunity in the courts of other states stayed as it had been: a matter of common law.  And that conclusion points against, rather than supporting, the outcome in Hyatt.