Merits Brief — Cedric Galette, Petitioner v. New Jersey Transit Corporation

Supreme Court briefSep 3, 2025

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Nos. 24-1021, 24-1113

IN THE

Supreme Court of the United States

————

CEDRIC GALETTE, PETITIONER

NEW JERSEY TRANSIT CORPORATION

————

NEW JERSEY TRANSIT CORPORATION, ET AL.,

PETITIONERS

JEFFREY COLT AND BETSY TSAI

————

ON WRITS OF CERTIORARI TO THE SUPREME COURT OF

PENNSYLVANIA AND THE COURT OF APPEALS OF NEW YORK

————

BRIEF FOR THE NEW JERSEY TRANSIT

PETITIONERS

————

MATTHEW J. PLATKIN

Attorney General

JEAN P. REILLY

JEREMY M. FEIGENBAUM*

DANIEL M. VANNELLA

Solicitor General

Assistant Attorneys General MICHAEL L. ZUCKERMAN

Deputy Solicitor General

KATHERINE L. PRINGLE

FFICE

OF THE ATTORNEY

SCOTT H. HENNEY

ENERAL

OF NEW JERSEY

FRIEDMAN KAPLAN SEILER

25 Market Street, Box 080

ADELMAN & ROBBINS LLP

Trenton, NJ 08625

7 Times Square

(862) 350-5800

New York, NY 10036

jeremy.feigenbaum@njoag.gov

Counsel for Petitioners

September 3, 2025

* Counsel of Record

[ADDITIONAL COUNSEL LISTED ON INSIDE COVER]

WILSON-EPES PRINTING CO., INC. – (202) 789-0096 – WASHINGTON, D.C. 20002

NATHANIEL F. RUBIN

AMY CHUNG

MARIE CEPEDA MEKOSH

BRETT HAROLDSON

LEVI KLINGER-CHRISTIANSEN

JONATHAN W. ALLEN

BETHANNE PRUGH

Deputy Attorneys General

QUESTION PRESENTED

Whether New Jersey Transit is an arm of the State

for interstate sovereign immunity purposes.

(i)

PARTIES TO THE PROCEEDINGS BELOW

Petitioner in 24-1021, plaintiff-appellant below, is

Cedric Galette.

Respondent in 24-1021, defendant-appellee below, is

New Jersey Transit Corporation, which was one of two

defendants in the action. Julie E. McCrey was the

second defendant. McCrey is a private individual who

did not appear in the action below.

Petitioners in 24-1113, defendants-appellants

below, are New Jersey Transit Corporation, NJ

Transit Bus Operations, Inc., and Ana Hernandez

(collectively “NJ Transit”).

Respondents in 24-1113, plaintiffs-appellees below,

are Jeffrey Colt and Betsy Tsai.

DISCLOSURE STATEMENT

New Jersey Transit Corporation and its wholly

owned subsidiary NJ Transit Bus Operations, Inc. are

governmental entities.

TABLE OF CONTENTS

Page

QUESTION PRESENTED ..................................

PARTIES TO THE PROCEEDINGS BELOW ...

DISCLOSURE STATEMENT .............................

TABLE OF AUTHORITIES ................................

OPINIONS BELOW ............................................

JURISDICTION ..................................................

INTRODUCTION ................................................

STATEMENT OF THE CASE ............................

Interstate Sovereign Immunity................

NJ Transit .................................................

Factual and Procedural History ...............

1. NJ Transit v. Colt ................................

2. Galette v. NJ Transit ...........................

SUMMARY OF ARGUMENT .............................

ARGUMENT ........................................................

NJ Transit Is An Arm Of New Jersey ................

Textual And Structural Evidence Of

State Intent ...............................................

State Control Over The Entity .................

The State’s Financial Relationship With

The Entity .................................................

Sue-And-Be-Sued Clauses ........................

CONCLUSION ....................................................

(iii)

TABLE OF AUTHORITIES

Page(s)

CASES

Acad. Bus Tours, Inc. v. NJ Transit,

622 A.2d 1335 (N.J. App. Div. 1993) ........

Alaska Cargo Transp., Inc. v.

Alaska R.R. Corp.,

5 F.3d 378 (CA9 1993) ..............................

Alden v. Maine,

527 U.S. 706 (1999) ...................................

5, 6

Arkansas v. Texas,

346 U.S. 368 (1953) ........... 18, 20, 21, 30, 41, 43

Auer v. Robbins,

519 U.S. 452 (1997) ...................................

In re Ayers,

123 U.S. 443 (1887) ........................... 5, 6, 16, 19

Bank of Ky. v. Wister,

27 U.S. (2 Pet.) 318 (1829) ........................ 18, 27

Bank of U.S. v. Planters’ Bank of Ga.,

22 U.S. (9 Wheat.) 904 (1824)...................

Berger v. N.C. State Conf. of NAACP,

597 U.S. 179 (2022) ...................................

Biden v. Nebraska,

600 U.S. 477

(2023) ................14, 21, 25, 28, 30, 34, 36, 39, 43

Bond v. United States,

564 U.S. 211 (2011) ...................................

Briscoe v. Bank of Ky.,

36 U.S. (11 Pet.) 257 (1837) ...................... 18, 27

TABLE OF AUTHORITIES—Continued

Page(s)

Burgos v. State,

118 A.3d 270 (N.J. 2015) ..........................

City of Bayonne v. Palmer,

217 A.2d 141 (N.J. Sup. Ct. Ch. Div.

1966) ..........................................................

Coll. Savs. Bank v. Fla. Prepaid Postsec.

Educ. Expense Bd.,

527 U.S. 666 (1999) ................................... 43, 46

Dep’t of Emp’t v. United States,

385 U.S. 355 (1966) ...................................

Dep’t of Transp. v. Ass’n of Am. R.R.s,

575 U.S. 43 (2015) ............. 22, 25, 28, 30, 34, 37

Dixon v. United States,

7 F. Cas. 761 (C.C.D. Va. 1811) ................

Dugan v. Rank,

372 U.S. 609 (1963) ...................................

Fed. Mar. Comm’n v. S.C. State Ports Auth.,

535 U.S. 743

(2002) ........... 2, 4-6, 13, 15-17, 19, 23, 34, 38, 40

Franchise Tax Bd. of Cal. v. Hyatt,

587 U.S. 230 (2019) .......................... 1, 2, 4-6, 19

Fresenius Med. Care Cardiovascular Res.,

Inc. v. P.R. & Caribbean

Cardiovascular Ctr.,

322 F.3d 56 (CA1 2003) ............................

Garcia v. San Antonio Metro. Transit Auth.,

469 U.S. 528 (1985) ...................................

TABLE OF AUTHORITIES—Continued

Page(s)

Gregory v. Ashcroft,

501 U.S. 452 (1991) ................................... 20, 25

Hess v. Port Auth. Trans-Hudson Corp.,

513 U.S. 30

(1994) ............ 2, 13, 16-18, 28, 29, 31, 34, 37, 39

Highland Farms Dairy, Inc. v. Agnew,

300 U.S. 608 (1937) ...................................

Hunter v. City of Pittsburgh,

207 U.S. 161 (1907) ...................................

In re McGee,

No. A-0566-22, 2024 WL 4404145

(N.J. App. Div. Oct. 4, 2024) .....................

In re Plan for Abolition of Council on

Affordable Hous.,

70 A.3d 559 (N.J. 2013) ............................ 32, 33

In re Protest of Contract for

Retail Pharm. Design,

314 A.3d 768 (N.J. 2024) ..........................

In re Veto by Gov. Chris Christie,

58 A.3d 735 (N.J. App. Div. 2012) ............

Infinity Broad. Corp. v. N.J. Meadowlands

Comm’n,

901 A.2d 312 (N.J. 2006) ..........................

Karns v. Shanahan,

879 F.3d 504 (CA3 2018) ..........................

Kennedy v. Braidwood Mgmt., Inc.,

145 S. Ct. 2427 (2025) ...............................

vii

TABLE OF AUTHORITIES—Continued

Page(s)

Kohn v. State Bar of Cal.,

87 F.4th 1021 (CA9 2023) ............. 17, 24, 26, 46

Lake Country Ests., Inc. v. Tahoe Reg’l

Plan. Agency,

440 U.S. 391

(1979) .... 2, 13, 16-18, 20, 27, 28, 30, 31, 34, 38, 39

Lebron v. Nat’l R.R. Passenger Corp.,

513 U.S. 374 (1995) ................. 25, 28, 30, 42, 46

Lincoln County v. Luning,

133 U.S. 529 (1890) ................................... 29, 45

McIlvaine v. Coxe’s Lessee,

8 U.S. (4 Cranch) 209 (1808) ....................

Monaco v. Mississippi,

292 U.S. 313 (1934) ...................................

Morris v. WMATA,

781 F.2d 218 (CADC 1986) .......................

Mower v. Inhabitants of Leicester,

9 Mass. 247 (1812) ....................................

Mt. Healthy City Sch. Dist. Bd. of Educ. v.

Doyle, 429 U.S. 274 (1977)....... 13, 16-18, 27, 44

Muhammad v. N.J. Transit,

821 A.2d 1148 (N.J. 2003) ........................ 10, 21

N. Ins. Co. of N.Y. v. Chatham County,

547 U.S. 189 (2006) ...................................

N.J. Civ. Serv. Ass’n v. State,

443 A.2d 1070 (N.J. 1982) ........................

viii

TABLE OF AUTHORITIES—Continued

Page(s)

N.J. Transit PBA Local 304 v.

N.J. Transit Corp.,

675 A.2d 1180 (N.J. App. Div. 1996) ........

Ex parte New York,

256 U.S. 490 (1921) ...................................

Pennhurst State Sch. & Hosp. v. Halderman,

465 U.S. 89 (1984) ..................................... 20, 41

P.R. Aqueduct & Sewer Auth. v. Metcalf &

Eddy,

506 U.S. 139 (1993) ...................................

Puerto Rico Ports Auth. v. Fed. Mar. Comm’n,

531 F.3d 868 (CADC

2008) ............................. 17, 18, 20, 26, 29, 38-41

Regents of the Univ. of Cal. v. Doe,

519 U.S. 425 (1997) ....... 2, 15, 16, 20, 33, 38, 40

Schooner Exch. v. McFaddon,

11 U.S. (7 Cranch) 116 (1812) ............ 14, 19, 27

Seila Law LLC v. CFPB,

591 U.S. 197 (2020) ...................................

Seminole Tribe of Fla. v. Florida,

517 U.S. 44 (1996) .....................................

Soper v. Henry County,

26 Iowa 264 (1868) ....................................

Springboards to Educ., Inc. v.

McAllen Indep. Sch. Dist.,

62 F.4th 174 (CA5 2023) ........................... 40, 44

State Highway Comm’n v. Utah Constr. Co.,

278 U.S. 194 (1929) ...................................

TABLE OF AUTHORITIES—Continued

Page(s)

Thacker v. Tenn. Valley Auth.,

587 U.S. 218 (2019) ...................................

Trs. of Dartmouth Coll. v. Woodward,

17 U.S. (4 Wheat.) 518

(1819) ........................ 15, 18, 22, 27, 29, 30, 43, 44

Va. Off. for Prot. & Advoc. v. Stewart,

563 U.S. 247 (2011) ................................... 28, 46

Vincenheller v. Reagan,

64 S.W. 278 (Ark. 1901) ............................

Washington v. Seattle Sch. Dist. No. 1,

458 U.S. 457 (1982) ...................................

CONSTITUTIONAL PROVISIONS

U.S. Const. art. I, §8, cl. 7 ............................

U.S. Const. art. III ........................................

N.J. Const. art. IV, §7 ¶10 ...........................

N.J. Const. art. IV, §7 ¶11 ...........................

N.J. Const. art. V, §4, ¶1 ........................ 21, 31, 32

N.J. Const. art. V, §4, ¶2 ..............................

N.J. Const. art. V, §4, ¶3 ..............................

N.J. Const. art. V, §4, ¶5 ..............................

STATUTES

28 U.S.C. § 1257(a) .......................................

Alaska Stat. §43.31.091................................

Alaska Stat. §44.83.020................................

Fla. Stat. §334.044(8) ...................................

TABLE OF AUTHORITIES—Continued

Page(s)

Ga. Code Ann. §32-2-5(a) .............................

20 Ill. Comp. Stat. 3805/4.............................

20 Ill. Comp. Stat. 3805/7.8..........................

La. Stat. Ann. §36:401 ..................................

La. Stat. Ann. §36:451 ..................................

La. Stat. Ann. §36:471 ..................................

La. Stat. Ann. §36:701 ..................................

La. Stat. Ann. §36:741 ..................................

La. Stat. Ann. §36:761 ..................................

Minn. Stat. §462A.06....................................

Mo. Ann. Stat. §217.020(2)...........................

1966 N.J. Laws ch. 301 ................................

2025 N.J. Laws ch. 74 (S.2026), https://tiny

url.com/2ubd2xeu...................................... 10, 35

N.J. Public Transportation Act of 1979,

N.J. Stat. Ann. §27:25-1 et seq. ................

§27:25-2 ..................................................... 7, 25

§27:25-4 ................ 7-9, 14, 21, 22, 24, 31, 32, 40

§27:25-4.1(a) ..............................................

§27:25-4.1(b)(1) .........................................

§27:25-5 ............................... 8, 10, 22, 23, 36, 40

§27:25-5.25(a) ............................................ 9, 31

§27:25-8(d) .................................................

§27:25-13 ............................................... 8, 22, 32

TABLE OF AUTHORITIES—Continued

Page(s)

§27:25-15 ...................................................

§27:25-15.1(a) ............................................ 8, 22

§27:25-16 ........................................... 8, 9, 21, 22

§27:25-17 ............................................. 10, 34, 36

§27:25-19 ...................................................

§27:25-20 ................................... 9, 10, 22, 23, 34

§27:25-24.2 .......................................... 10, 14, 23

N.J. Stat. Ann. §27:1A-2 ..............................

N.J. Stat. Ann. §27:1A-4 ..............................

N.J. Stat. Ann. §27:1A-66 ............................

N.J. Stat. Ann. §27:1B-7 .............................. 10, 36

N.J. Stat. Ann. §27:1B-9 ..............................

N.J. Stat. Ann. §27:1B-21.6 ......................... 10, 36

N.J. Stat. Ann. §27:1B-21.9 .........................

N.J. Stat. Ann. §52:14-7(a)...........................

N.J. Stat. Ann §52:18A-90.4(a) ....................

New Jersey Tort Claims Act, N.J. Stat.

Ann. §59:1-1 et seq. ...................................

§59:1-3 .......................................................

§59:10-4 .....................................................

§59:10-5 .....................................................

§59:10A-1...................................................

xii

TABLE OF AUTHORITIES—Continued

Page(s)

New Jersey Contractual Liability Act, N.J.

Stat. Ann. §59:13-1 et seq. ........................

§59:13-3 .....................................................

4 Pa. Cons. Stat. Ann. §1202(b)(3) ...............

Tex. Gov’t Code Ann. §1232.051 ..................

Tex. Gov’t Code Ann. §1232.067(3) ..............

Tex. Gov’t Code Ann. §2306.053(b)(1) .........

Utah Code Ann. §72-1-207(1) .......................

Wash. Rev. Code. §43.180.040 .....................

Wash. Rev. Code. §43.180.080(2) .................

Wis. Stat. §101.02(2) ....................................

Wis. Stat. §301.04 .........................................

RULES

N.J. Admin. Code §16:83-3.8 ........................

N.J. Ct. R. 2:2-3(a)(2) ...................................

OTHER AUTHORITIES

1 Blackstone, Commentaries ........................ 44, 45

Federalist No. 39 (Madison) (Clinton

Rossiter ed., 1961).....................................

Federalist No. 46 (Madison) (Clinton

Rossiter ed., 1961).....................................

Federalist No. 81 (Hamilton) (Clinton

Rossiter ed., 1961).....................................

xiii

TABLE OF AUTHORITIES—Continued

Page(s)

Flow of Funds, N.J. TTFA (Aug. 12, 2020),

https://www.nj.gov/ttfa/financing/flowfu

nds.shtm ....................................................

Gerald Frug, City Making: Building

Communities Without Building Walls

(1999) .........................................................

Harry Scheiber, State Law & “Industrial

Policy” in Am. Dev.., 75 Calif. L. Rev. 415

(1987) .........................................................

Harry Scheiber, The Transp. Revolution &

Am. Law: Constitutionalism & Public

Policy, in Transp. & the Early Nation

(1981) .........................................................

Joseph

Berechman,

Transp.—Econ.

Aspects of Roman Highway Development:

The Case of Via Appia, 37 Transp. Rsch.

Part A: Policy & Practice 453 (2003) ........

Joseph Sullivan, Jersey Transit Bonds

Pass, N.Y. Times, Nov. 7, 1979,

https://tinyurl.com/cz2ukdy4 ....................

Joan Williams, The Invention of the

Municipal Corporation: A Case Study in

Legal Change, 34 Am. U. L. Rev. 369

(1985) .........................................................

Magna Carta (1215), in J.C. Hoult, Magna

Carta (3d ed. 2015) ...................................

N.J. Dep’t of Treasury, Appropriation

Handbook: Fiscal Year 1979-1980 (1979) ....

xiv

TABLE OF AUTHORITIES—Continued

Page(s)

1 N.J. Public Transportation Act of 1979:

Hearing on S. Bill 3137 Before Sen.

Transp. & Comm’cns Comm., 130th Sen.

(N.J. 1979) .................................................

2 N.J. Public Transportation Act of 1979:

Hearing on S. Bill 3137 Before Sen.

Transp. & Comm’cns Comm., 130th Sen.

(N.J. 1979) .................................................

NJ Transit, 2023-2024 Annual Financial

Report (2024), https://tinyurl.com/5xxfjp

vr................................................................

Transit,

Annual

Report

1992

(1992) .........................................................

NJ Transit, FY 2012 Consolidated Financial

Statements (2012), https://dspace.njstatel

ib.org/server/api/core/bitstreams/87165a

79-e4c3-4134-8e9a-5a236ef1e5bc/content ....

NJDOT/NJ Transit Capital Program, N.J.

TTFA (Feb. 21, 2025), https://www.nj.

gov/ttfa/capital/ .........................................

Nikolas Bowie, Why the Constitution Was

Written Down, 71 Stan. L. Rev. 1397

(2019) .........................................................

Oliver Field, Government Corporations: A

Proposal, 48 Harv. L. Rev. 775 (1935) ..... 41, 42

Press Release, Office of the Governor (July

17, 1979) ....................................................

TABLE OF AUTHORITIES—Continued

Page(s)

Sidney & Beatrice Webb, English Local

Gov’t From the Revolution to the Mun.

Corps. Act: The Parish & the County

(1906) .........................................................

BRIEF FOR THE NEW JERSEY TRANSIT

PETITIONERS

OPINIONS BELOW

The opinion of the Supreme Court of Pennsylvania

is reported at 332 A.3d 776. See also Galette Pet.App.124.

The opinion of the Superior Court of Pennsylvania

is reported at 293 A.3d 649. See also Galette

Pet.App.25-37.

The opinion of the Pennsylvania Court of Common

Pleas is unreported but available at 2021 WL

11551626. See also Galette Pet.App.38-39.

The opinion of the New York Court of Appeals is

reported at 43 N.Y.3d 463. See also Colt Pet.App.1-89.

The opinion of the Supreme Court of New York,

Appellate Division, First Department, is reported at

169 N.Y.S.3d 585. See also Colt Pet.App.90-116.

The decision of the Supreme Court of New York,

New York County, is not reported, but is available at

2020 WL 5893749. See also Colt Pet.App.117-121.

JURISDICTION

The Supreme Court of Pennsylvania entered

judgment on March 12, 2025. The New York Court of

Appeals entered judgment on November 25, 2024. This

Court’s jurisdiction over both petitions is invoked

under 28 U.S.C. §1257(a).

INTRODUCTION

Interstate sovereign immunity protects each State

from the indignity of being haled into another’s courts

without its consent. Franchise Tax Bd. of Cal. v. Hyatt,

587 U.S. 230, 245-247 (2019) (Hyatt III). As this

Court has recognized, the States possessed “inviolable

sovereignty” when they entered the Union, and their

“immunity from private suits” remained both “well

established and widely accepted at the founding.” Id.,

at 238. That immunity applies, as well, in the courts

of their sister States: because “it is inherent in the

nature of sovereignty not to be amenable to the suit”

absent “consent,” id., the Constitution thus ensured

“the inability of one State to hale another into its

courts without the latter’s consent,” id., at 245.

The State’s inviolable immunity applies not only to

lawsuits formally brought against the State, but also

to any “arm of the State.” Regents of the Univ. of Cal.

v. Doe, 519 U.S. 425, 431 (1997). The rule could hardly

be otherwise: a lawsuit against the New Jersey Office

of the Attorney General, or a State’s Department of

Transportation, offends a State’s dignity no less than

one styled as against “the State of New Jersey” itself.

That requires courts to consider which entities share

in their creator State’s sovereignty—that is, which are

among its sovereign arms. And that, in turn, requires

courts to look principally at the textual and structural

evidence that bears on the State’s intent to “structure”

the entity as one of its arms, Lake Country Ests., Inc.

v. Tahoe Reg’l Plan. Agency, 440 U.S. 391, 401 (1979),

to avoid the indignity of overruling a State’s own view

regarding how it organized its own government, Fed.

Mar. Comm’n v. S.C. State Ports Auth., 535 U.S. 743,

769 (2002) (FMC) (confirming “the primary function of

sovereign immunity” is to protect the States’ dignity

as sovereigns). And it requires courts to consider both

the control the State exercises over the entity and its

overall financial relationship with the entity too. See

Lake Country, 440 U.S., at 401-402; Hess v. Port Auth.

Trans-Hudson Corp., 513 U.S. 30, 51 (1994).

These two tort suits against NJ Transit cannot go

forward in light of these established principles.

Although NJ Transit is suable in New Jersey state

court under the New Jersey Tort Claims Act (NJTCA),

under which the State waived its sovereign immunity

in relevant part, these tort suits were filed in the

New York and Pennsylvania trial courts instead. The

Pennsylvania Supreme Court unanimously agreed

that sovereign immunity barred such suits, recognizing NJ Transit as an arm of New Jersey. But a

fractured New York Court of Appeals allowed such

suits to proceed in its trial courts.

This Court should reverse the New York judgment

below, because the evidence that NJ Transit is an arm

of the Garden State is overwhelming. The Legislature

could hardly have been clearer that it was structuring

NJ Transit as one of its sovereign arms. It established

the entity as an “instrumentality” of the State, and it

placed that instrumentality in the State’s Executive

Branch. It created NJ Transit to fulfill an “essential

public purpose.” It delegated to NJ Transit a series of

statewide powers, including general law-enforcement

powers, eminent-domain authority, and the power to

issue regulations that have the force of law. It deemed

NJ Transit’s property to be state property. It entitled

NJ Transit to be represented by the State’s Attorney

General—as it is here. And it specifically instructed

NJ Transit on narrow contexts where it could not assert

sovereign immunity—an odd choice if the Legislature

structured NJ Transit to lack immunity at all.

Other evidence abounds. The Governor enjoys both

appointment and removal powers as to all NJ Transit

Board members, and has the authority to veto any and

all actions the Board takes—a plain distinction from

private companies or local governments. And while the

state treasury is not itself formally liable for money

judgments against NJ Transit, NJ Transit is

financially dependent on the State for both capital and

operating expenses—resulting from the Legislature’s

decision to restrict NJ Transit’s ability to incur debt,

raise revenue, or lower costs. Because all the statutory

evidence demonstrates that the State established NJ

Transit as one of its arms, state-law tort claims cannot

proceed against it in other States’ courts absent

consent.

STATEMENT OF THE CASE

A. Interstate Sovereign Immunity.

The States’ sovereign immunity is “integral to the

structure of the Constitution.” Hyatt III, 587 U.S., at

246. The States possessed immunity as a part of their

“inviolable sovereignty” when they chose to enter into

the Union, id., at 238 (quoting Federalist No. 39, at

245 (Madison) (Clinton Rossiter ed., 1961)), as they

considered themselves to be “fully sovereign nations”

after declaring independence, id., at 237-238 (citing

McIlvaine v. Coxe’s Lessee, 8 U.S. (4 Cranch) 209, 212

(1808)). Because the States retained core aspects of

that sovereignty when they ratified the Constitution,

id., at 241-247, the States’ preexisting “immunity from

private suits” remained “well established and widely

accepted at the founding,” id., at 238.

The Founders viewed the “preeminent purpose

of state sovereign immunity” as ensuring to the

“States the dignity that is consistent with their status

as sovereign entities.” FMC, 535 U.S., at 760. The

“founding generation thought it ‘neither becoming nor

convenient that the several States of the Union,

invested with that large residuum of sovereignty

which had not been delegated to the United States,

should be summoned as defendants to answer the

complaints of private persons.’” Alden v. Maine, 527

U.S. 706, 748 (1999) (quoting In re Ayers, 123 U.S. 443,

505 (1887)). As they saw it, because “it is inherent in

the nature of sovereignty not to be amenable to the

suit of an individual without its consent,” Hyatt III,

587 U.S., at 238 (quoting Federalist No. 81, at 487

(Hamilton) (Clinton Rossiter, ed., 1961)), exercising

jurisdiction against the States in private suits would

indicate that the States were not true sovereigns

after all—contrary to the promises made during the

ratification process, id., at 241-243.

That immunity means the States cannot “be haled

involuntarily before each other’s courts.” Id., at 239.

Although the States through Article III agreed to

“a neutral federal forum” in which the States would

“be amenable to suits brought by other States,” id., at

241, the opposite was true in each other’s courts. Not

only that, but the Constitution “divests the States”

of “tools that foreign sovereigns possess” to protect

their own dignity. Id., at 245. So in addition to ceding

such “political means” for resolving conflicts among

sovereigns, the States also agreed to relinquish “any

power they once had to refuse each other sovereign

immunity.” Id., at 247. In other words, “each State’s

equal dignity and sovereignty under the Constitution”

carries alongside it a corollary “inability of one State

to hale another into its courts without the latter’s

consent.” Id., at 245.

That immunity applies across myriad contexts.

Consistent with its “primary function” to “afford the

States the dignity and respect due sovereign entities,”

FMC, 535 U.S., at 769 (rather than to “protect state

treasuries”), sovereign immunity applies regardless of

whether the relief is financial or injunctive, Seminole

Tribe of Fla. v. Florida, 517 U.S. 44, 58 (1996). It

extends to lawsuits before administrative agencies,

FMC, 535 U.S., at 747, in a State’s own courts, Alden,

527 U.S, at 712, and by a foreign country, Monaco v.

Mississippi, 292 U.S. 313, 332 (1934). And it applies

when a State is the real party against which “relief is

asked,” Ayers, 123 U.S., at 506—extending immunity

to each State and to any entity “acting as an arm of

the State, as delineated by this Court’s precedents,”

N. Ins. Co. of N.Y. v. Chatham County, 547 U.S. 189,

194 (2006). In all these contexts, the “constitutional

design” shows that no State—nor its arms—may

be haled into another State’s courts “without [its]

consent.” Hyatt III, 587 U.S., at 245.

B. NJ Transit.

NJ Transit has operated New Jersey’s statewide

public transportation system since the Legislature

created it in 1979. See N.J. Public Transportation Act

of 1979, N.J. Stat. Ann. §27:25-1 et seq. Today, it

operates one of the largest public transit agencies in

the country, providing “nearly 270 million passenger

trips each year.” Colt Pet.App.78. In addition to

managing a network of bus and rail services extending

across the State and into both New York and

Pennsylvania, NJ Transit administers “publicly

funded transit programs for people with disabilities,

senior citizens, and people living in the state’s rural

areas.” Id.

The entity’s creation arose from public challenges

with the fragmented provision of transportation in our

Nation’s most densely populated State. In the 1960s,

facing increased highway congestion, the Legislature

began experimenting with efforts to support mass

transit. See generally City of Bayonne v. Palmer,

217 A.2d 141, 145-150 (N.J. Sup. Ct. Ch. Div. 1966)

(summarizing legislation from 1959 to 1964); 1966

N.J. Laws ch. 301, at 1357-1365 (establishing

Commuter Operating Agency in the New Jersey

Department of Transportation). In 1969, the

Legislature enacted stop-gap legislation to provide a

one-year subsidy of $500,000 to “bail out” struggling

private companies contracted to provide public

transportation services; by 1979, the subsidy had

ballooned to “nearly $50 million” and “threaten[ed] to

approach $100 million.”1 But relying on subsidies to

private industry left New Jersey with limited control

over service provision and costs, leaving commuters to

navigate fragmented services. Rising inflation and the

energy crisis of the 1970s made matters worse.2

In creating NJ Transit, the Legislature concluded

that the “provision of efficient, coordinated, safe and

responsive public transportation is an essential public

purpose,” and that it was the “responsibility of the

State” to create a system to provide it. N.J. Stat. Ann.

§27:25-2(a)-(b). The Legislature thus established NJ

Transit as “an instrumentality of the State,” designed

to perform “public and essential governmental

functions.” Id. §27:25-4(a).

New Jersey structured its transit system as “a body

corporate and politic” within “the Executive Branch

of the State Government.” Id. Consistent with NJ

Transit’s placement in the Executive Branch, the

Governor appoints all eleven voting members of NJ

Transit’s Board—including two ex officio members of

1 N.J. Public Transportation Act of 1979: Hearing on S. Bill

3137 Before Sen. Transp. & Comm’cns Comm., 130th Sen., at 2

(N.J. 1979) (Sen. Hrgs.) (Sen. Herbert); id., at 8-9, 12, 19 (Transp.

Comm’r Gambaccini).

See 2 Sen. Hrgs., at 19 (Bergen Cty. Transp. Dir. Frank E. Tilley).

his cabinet, six members appointed with the advice

and consent of the Senate, and two appointed on the

recommendation of the President of the Senate and

Speaker of the General Assembly. Id. §27:25-4(b). The

New Jersey Commissioner of Transportation serves as

Board chair. Id. §27:25-4(d). The Governor retains

authority to remove any Board member for cause (and

ex officio members at will). Id. §27:25-4(b). And the

Governor has authority to veto any or all action the

Board takes. Id. §27:25-4(f). The Board must convey

minutes of every meeting to the Governor, and its

actions do not take effect for ten days to afford him a

chance to veto them. Id.

The Legislature delegated NJ Transit a number of

statewide governmental powers. It is authorized to

promulgate rules and regulations with “the force and

effect of law.” Id. §27:25-5(e). It has a police force with

statewide jurisdiction; its law-enforcement officers can

enforce “all criminal and traffic matters at all times

throughout the State.” Id. §27:25-15.1(a). It has

statewide eminent-domain powers. Id. §27:25-13. And

its property is deemed untaxable property belonging

to the State. Id. §27:25-16.

NJ Transit’s regulatory actions follow the same

procedures as state agencies. It must promulgate rules

in compliance with the New Jersey Administrative

Procedure Act (NJAPA). Id. §27:25-5(e); see Acad. Bus

Tours, Inc. v. N.J. Transit, 622 A.2d 1335, 1340 (N.J.

App. Div. 1993). Any challenges to its administrative

actions start in the State’s Office of Administrative

Law, see In re McGee, No. A-0566-22, 2024 WL

4404145 (N.J. App. Div. Oct. 4, 2024), the State’s

central forum for administrative adjudications for

state agencies alone, N.J. Civ. Serv. Ass’n v. State, 443

A.2d 1070, 1071-1072 (N.J. 1982). And consistent with

New Jersey’s specialized judicial-review process for

state administrative agencies, N.J. Ct. R. 2:2-3(a)(2),

appeals from NJ Transit actions are available directly

in the state intermediate appellate court, e.g., N.J.

Admin. Code §16:83-3.8.

The Legislature attached to these statewide public

powers statewide political oversight—beyond the

Governor’s appointment, removal, and veto powers.

The Legislature requires that the Board publish its

agendas at least five days before each meeting, and

that at least half the Board meetings take place after

6:00 p.m., to allow NJ Transit riders to more easily

attend. N.J. Stat. Ann. §27:25-4(g)(1). The Legislature

subjects NJ Transit to special legislative-reporting

requirements. Id. §27:25-5.25(a). And NJ Transit’s

records, including financial information, are “declared

to be government records … open to public inspection

in accordance with” New Jersey government-transparency laws and NJ Transit regulations. Id. §27:25-20(c).

These measures seek to ensure NJ Transit follows its

charge to “exercise [its] powers … in all respects for

the benefit of the people of the State.” Id. §27:25-16.

NJ Transit relies on the State for funding, as the

entity operates at a consistent financial loss.3 While

the State is not formally liable for money judgments

against NJ Transit, the Legislature has always

heavily subsidized its operations, for example funding

46% of NJ Transit’s FY2026 operating expenses, via

an appropriation of just under $1.5 billion in total for

this purpose through New Jersey’s Corporate Transit

See NJ Transit, 2023-2024 Annual Financial Report 9, tbl. A2 (2024), https://tinyurl.com/5xxfjpvr (operating losses over $2.5

billion each of past three years).

Fee and direct spending authorization. See 2025

N.J. Laws ch. 74 (S.2026) at 2, 259-261 (FY2026

Appropriations Act), https://tinyurl.com/2ubd2xeu.

Indeed, with one exception, the Legislature forbids NJ

Transit from incurring any debt or selling bonds, see

N.J. Stat. Ann. §§27:25-5(w), -17, meaning that NJ

Transit can (and does) receive non-federal capital

funding solely through appropriations or disbursements via another state instrumentality, the Transportation Trust Fund Authority (TTFA), see id.

§§27:1B-7, -21.6; id. §27:25-5(h). So given the expected

reliance on legislative appropriations, the Legislature

requires NJ Transit to submit yearly a “proposed

budget recommendation,” along with an “annual

report of its activities for the preceding fiscal year”

and “a complete operating and financial statement

covering its operations and capital projects.” Id.

§27:25-20(b), (g).

The Legislature, to be sure, has agreed that NJ

Transit can be subject to some suits. NJ Transit can

sue and be sued, id. §27:25-5(a), and is suable under

the NJTCA in New Jersey state trial courts, id. §59:11 et seq.; see Muhammad v. N.J. Transit, 821 A.2d

1148, 1153 (N.J. 2003). NJ Transit also cannot assert

its “sovereign immunity with respect to any claim or

cause of action arising from the Federal Employers

Liability Act,” the Federal Railroad Safety Act, or

several related laws. N.J. Stat. Ann. §27:25-24.2. NJ

Transit can also be sued in contract—but only under

the New Jersey Contractual Liability Act, id. §59:13-1

et seq.; see id. §27:25-19, which limits the types of

claims and damages available against it, id. §59:13-3.

And finally, when sued, NJ Transit is entitled to be

represented by the New Jersey Attorney General’s

Office, id. §27:25-5(z), as it is here.

C. Factual and Procedural History.

1. NJ Transit v. Colt.

Jeffery Colt and Betsy Tsai sued NJ Transit in the

New York Supreme Court in 2017. Colt Pet.App.2.

They alleged that an NJ Transit bus negligently

struck Colt at a Manhattan crosswalk. Id. NJ Transit

moved to dismiss on sovereign immunity grounds. Id.,

at 123-129. The state trial court denied the motion, id.,

at 121, and a divided state appellate court affirmed,

id., at 90-116.

A fractured majority of the New York Court of

Appeals affirmed, holding NJ Transit is not an arm of

New Jersey. Id., at 1-19. The majority looked to three

factors from precedent: “(1) how the State defines the

entity and its functions, (2) the State’s power to direct

the entity’s conduct, and (3) the effect of on the State

of a judgment against the entity.” Id., at 13. The court

held that New Jersey’s characterization of NJ Transit

only “lean[ed] toward” sovereign immunity, id., at 1316, and that the State’s control over NJ Transit did not

“weigh heavily in either direction,” id., at 16-17. The

majority instead relied on the third factor, and held

that because New Jersey was not formally liable

for money judgments against NJ Transit, haling NJ

Transit into New York court “would not be an affront

to New Jersey’s dignity.” Id., at 17-18.

Judge Halligan concurred, id., at 20-32, finding it

“understandable” to read the majority as focused more

on “a concern for state solvency, rather than dignity,”

id., at 22, even as this Court’s cases have emphasized

the latter. Chief Judge Wilson concurred in the result,

id., at 33-71, averring that the appropriate test was

“whether the function performed by the entity is what

would, under customary international law and the

common law, be considered a core governmental

function,” id., at 34, and that NJ Transit’s operations

“are not core functions necessary to the operation of a

state government,” id., at 54.

Judge Rivera dissented. Id., at 72-88. She found that

the “majority’s most significant mistake” was its

overreliance on the lack of formal financial liability for

a judgment against NJ Transit. Id., at 84. Instead, she

would have asked whether allowing the state-court

lawsuit to proceed absent New Jersey’s consent would

“alter[] New Jersey’s coequal status among the states,

in contravention of the constitutional design.” Id.

Because New Jersey’s own view of NJ Transit, the

powers given the entity, and New Jersey’s “significant

control” indicated that NJ Transit was an arm of New

Jersey, Judge Rivera found that it would offend New

Jersey’s sovereignty to proceed. Id., at 88.

Galette v. NJ Transit.

Cedric Galette sued NJ Transit in the Pennsylvania

Court of Common Pleas in 2021, alleging that an NJ

Transit bus had struck the car in which he was riding

on a Philadelphia street. Galette Pet.App.2. The state

trial court denied NJ Transit’s motion to dismiss. Id.

at 2-3, 38-39. The intermediate appellate court

affirmed, id. at 3-5, 25-37.

The Pennsylvania Supreme Court unanimously

reversed, holding NJ Transit is an arm of New Jersey

and thus not suable in Pennsylvania absent consent.

Id., at 1-24. Noting that interstate sovereign immunity

“ensures that each State honors the coequal sovereign

status of her sister States,” id., at 16, and “requires a

State to avoid a direct conflict with a sister State by

refusing to compel the sister State to defend against a

private action in the former State’s courts,” id., at 17,

the court reasoned that courts must give “primacy” to

“the manner in which the sister State classifies and

describes the entity within the structure of that State,”

id. New Jersey’s own definition of NJ Transit and the

entity’s functions were thus “the driving force in

concluding that NJ Transit is an arm of the State of

New Jersey.” Id., at 21-23.

This Court granted certiorari in Galette and Colt,

consolidating them for briefing and argument.

SUMMARY OF ARGUMENT

New Jersey Transit is an arm of New Jersey. This

Court’s cases make clear that an entity’s status as an

arm of the State turns on whether that State intended

to structure the entity to fall within its sovereignty. To

answer that, this Court evaluates (1) the textual and

structural evidence of the State’s own intent; (2) the

State’s control over the entity; and (3) the State’s

overall financial relationship with the entity. E.g., Mt.

Healthy City Sch. Dist. Bd. of Educ. v. Doyle, 429 U.S.

274, 280-281 (1977); Hess, 513 U.S., at 44-46; Lake

Country, 440 U.S., at 401-402. Each compels the

conclusion that NJ Transit has immunity.

A. The textual and structural evidence that New

Jersey structured NJ Transit as one of its arms is

overwhelming. Because “the primary function of

sovereign immunity” is to protect each State’s dignity,

FMC, 535 U.S., at 769, evidence of the State’s intent

often drives the arm-of-the-State analysis—to avoid

the indignity of another State’s courts overruling the

creator State’s own views about the status of its own

entities within its own government. And the evidence

that New Jersey sought to establish NJ Transit as a

sovereign arm is clear: the Legislature characterized

NJ Transit as a state “instrumentality”; put it in the

State’s “Executive Branch”; and clarified that it was

created to perform “public and essential governmental

functions.” N.J. Stat. Ann. §27:25-4(a). The State also

indicated that it had shared its sovereignty with NJ

Transit by instructing the entity on contexts in which

it may not assert sovereign immunity—a choice that

would make no sense if New Jersey had structured NJ

Transit to lack immunity to begin with. Id. §27:2524.2. The Legislature also delegated to NJ Transit

substantial statewide public powers—including the

powers to issue regulations with the force of law,

to enforce criminal laws statewide, and to condemn

property across the State—and deemed all NJ Transit

property untaxable and belonging to the State.

B. New Jersey also subjected NJ Transit to extensive statewide political control, consistent with its

treatment of other state agencies. Such control helps

distinguish sovereign entities from private entities

and political subdivisions, and reflects that each

State’s arms are (like the State itself) politically

accountable to the statewide populace. See Biden

v. Nebraska, 600 U.S. 477, 491 (2023) (Nebraska);

Schooner Exch. v. McFaddon, 11 U.S. (7 Cranch) 116,

137 (1812) (Marshall, C.J.). Here, the Governor appoints

all NJ Transit Board members, and each is subject to

his at-will or for-cause removal. N.J. Stat. Ann. §27:254(b). The Governor can also veto any or all actions the NJ

Transit Board takes. Id. §27:25-4(f). The New York

court erred in holding that this evidence of control did

not support NJ Transit’s sovereign status.

C. Financial considerations likewise support NJ

Transit’s arm-of-the-State status. NJ Transit relies

upon the State Legislature to cover sizable annual

operating deficits, which the Legislature anticipated

by limiting the entity’s own ability to lower costs, raise

revenue, and issue debt. That is further evidence that

New Jersey structured NJ Transit as one of its arms,

and that a money judgment against NJ Transit would

impact New Jersey. The New York Court of Appeals

asked only if the state treasury is formally liable for

money judgments against NJ Transit, but this Court

already warned lower courts not to “convert [the armof-the-State] inquiry into a formalistic question of

ultimate financial liability.” Regents, 519 U.S., at 430431. And for good reason: it is illogical that a state

statute committing to pay a significant portion of an

entity’s liabilities would be dispositive, whereas a law

covering a large share of the entity’s budget would

(on the Colt Court’s view) be irrelevant. Regardless,

the Colt court also erred in making such financial

considerations paramount, ignoring that “the primary

function of sovereign immunity is not to protect state

treasuries,” but to protect States’ dignity as coequal

sovereigns. FMC, 535 U.S., at 769.

D. That state law establishes NJ Transit as a body

corporate and politic that can sue and be sued in its

name is not to the contrary. States have established a

range of sovereign executive departments in precisely

this way, including state Departments of Corrections,

Departments of Transportation, and nearly the entire

Louisiana cabinet. This Court’s cases have thus long

clarified that sue-and-be-sued clauses shed little light

on sovereign status, precedent that coheres with

the Founding-era view that an entity’s corporate form

itself “neither gives nor prevents” governmental

status. Trs. of Dartmouth Coll. v. Woodward, 17 U.S.

(4 Wheat.) 518, 636, 638 (1819) (Marshall, C.J.).

Instead, sue-and-be-sued clauses primarily go to the

question of waiver—not a question of whether an

entity shares its creator State’s sovereignty in the

first place.

ARGUMENT

NJ Transit Is An Arm Of New Jersey

Whether NJ Transit enjoys New Jersey’s sovereign

immunity turns on whether NJ Transit falls within

New Jersey’s sovereignty and is thus an “arm” of the

State. “It has long been settled” that state sovereign

immunity “encompasses not only actions in which

a State is actually named as the defendant, but

also certain actions against state agents and state

instrumentalities.” Regents, 519 U.S., at 429 (citing

Ayers, 123 U.S., at 487). It could hardly be otherwise;

no one disputes that a State’s immunity extends not

just to the State, but also to entities like the Office of

the Attorney General and to other traditional state

agencies. Whether denominated as a State’s “arms,”

“instrumentalities,” or “alter egos,” they fall within the

State’s sovereignty, such that a suit against the entity

“walks, talks, and squawks very much like a lawsuit”

against the State. See FMC, 535 U.S., at 757. These

entities thus share the State’s immunity.

Since a sovereign’s prerogative to structure itself is

inherent in the nature of sovereignty, the “arm of the

State” test—while a question of federal law—turns on

an analysis of the relevant state statutes. See Regents,

519 U.S., at 429, n.5 (noting that the “federal question”

of state immunity “can be answered only after considering the provisions of state law that define the

agency’s character”). In assessing the state laws

governing the entity, this Court primarily looks at

textual and structural evidence that the sovereign

intended the entity to fall within its sovereign scope,

see Hess, 513 U.S., at 44-45; Lake Country, 440 U.S.,

at 401; Mt. Healthy, 429 U.S., at 280, which avoids the

indignity of another sovereign’s courts overruling the

State’s choices as to how it has shared its sovereignty.

Courts also assess what control the State maintains

over the entity, Hess, 513 U.S., at 44; Lake Country,

440 U.S., at 401, which confirms that the entity is

integrated into and accountable to the State, and thus

distinguishes a State’s “arms” from private, local, or

multistate entities. Courts consider too the financial

relationship between the entity and its creator, see

Hess, 513 U.S., at 45-46; Lake Country, 440 U.S., at

401-02; Mt. Healthy, 429 U.S., at 280, as yet further

evidence showing whether an entity was structured to

be an arm of the State.

Said another way, this Court’s cases provide three

considerations to test whether a sovereign created an

entity that shares in its sovereignty: (1) “express[]”

indications of “state intent”; (2) “state control” of the

entity; and (3) the State’s financial relationship with

the entity—that is, the entity’s “overall effects on the

state treasury.” Puerto Rico Ports Auth. v. Fed. Mar.

Comm’n, 531 F.3d 868, 874 (CADC 2008) (PRPA)

(Kavanaugh, J.).4 Because “the primary function of

sovereign immunity is not to protect state treasuries

but to afford” States equal dignity, FMC, 535 U.S., at

769, textual and structural evidence of the State’s

intent often drives this analysis. Here, however, these

three considerations each compel the finding that NJ

Transit—an “instrumentality” of New Jersey, housed

in its Executive Branch and subject to the Governor’s

statutory appointment, removal, and veto powers—

retains immunity in other States’ courts.

Then-Judge Kavanaugh was hardly the only judge to distill

this Court’s arm-of-the-State precedents this way. See, e.g., Kohn

v. State Bar of Cal., 87 F.4th 1021, 1027-1030 (CA9 2023) (en

banc); Karns v. Shanahan, 879 F.3d 504, 513 (CA3 2018);

Fresenius Med. Care Cardiovascular Res., Inc. v. P.R. &

Caribbean Cardiovascular Ctr., 322 F.3d 56, 61-68 (CA1 2003).

A. Textual And Structural Evidence Of State

Intent.

The evidence of New Jersey’s intent to establish a

sovereign arm is particularly clear. The State created

NJ Transit as an “instrumentality” in its Executive

Branch, imbued NJ Transit with public purposes and

powers, and subjected it to the procedures governing

state agencies—among other compelling evidence.

1. To understand “the nature of the entity created

by state law,” Mt. Healthy, 429 U.S., at 280, this Court

begins by assessing whether a State “structured” the

entity as one of its arms. Lake Country, 440 U.S., at

401; Hess, 513 U.S., at 43-44; see also PRPA, 531 F.3d,

at 873; Colt Pet.App.13-14; Galette Pet.App.21. As this

Court has explained, these “indicators of immunity or

the absence thereof,” Hess, 513 U.S., at 44, include the

State’s own express characterizations of an entity, see

id., at 44-45; Mt. Healthy, 429 U.S., at 280-281, as well

as other signals of how the State integrated the entity

into its state governmental work, see Hess, 513 U.S.,

at 44-46; Lake Country, 440 U.S., at 401-402. See also

Arkansas v. Texas, 346 U.S. 368, 370-371 (1953) (for

standing, considering how state law characterized

university to find that harms to university supported

suit by State). Those precedents reflect a longstanding

historical approach, with this Court’s earliest cases

indicating that whether an entity “share[s] in the civil

government of the country” logically stems from “the

purpose for which it was created.” Dartmouth, 17 U.S.,

at 636; see also, e.g., id., at 638; Briscoe v. Bank of Ky.,

36 U.S. (11 Pet.) 257, 325-326 (1837) (concluding that

Kentucky could not have intended to give sovereignty

to bank); Bank of Ky. v. Wister, 27 U.S. (2 Pet.) 318,

323-324 (1829) (same).

There are good reasons why statutory indications of

state intent have always played a critical role in the

analysis. Because the “preeminent purpose of state

sovereign immunity” is to protect States’ “dignity” by

preventing them from being haled into court without

their consent, FMC, 535 U.S., at 760, it stands to

reason that courts will seek first to understand what

a State’s own intentions were. After all, telling a State

that it was wrong to view its entity as sharing in its

immunity—and subjecting that entity “to the coercive

process of judicial tribunals at the instance of private

parties” despite the State’s own understanding to the

contrary—is itself no small indignity. Ayers, 123 U.S.,

at 505; see also Hyatt III, 587 U.S., at 245 (noting the

indignities that follow from a State’s courts subjecting

nonconsenting States to private suit); Schooner Exch.,

11 U.S., at 137 (“A foreign sovereign is not understood

as intending to subject himself to a jurisdiction

incompatible with his dignity….”).

Looking to States’ express textual and structural

indications also makes sense given the discretion they

enjoy “to structure themselves as they wish.” Berger v.

N.C. State Conf. of NAACP, 597 U.S. 179, 183 (2022).

In our federalist system, “[h]ow power shall be

distributed by a state among its governmental organs

is commonly, if not always, a question for the state

itself.” Highland Farms Dairy, Inc. v. Agnew, 300 U.S.

608, 612 (1937). This freedom “allows local policies

more sensitive to the diverse needs of a heterogeneous

society, permits innovation and experimentation,

enables greater citizen involvement in democratic

processes, and makes government more responsive

by putting the States in competition for a mobile

citizenry.” Bond v. United States, 564 U.S. 211, 221

(2011) (cleaned up). Because “the structure of its

government, and the character of those who exercise

government authority,” is a fundamental feature of

how “a State defines itself as a sovereign,” Gregory v.

Ashcroft, 501 U.S. 452, 460 (1991), the stakes of one

State incorrectly countermanding another’s views as

to the latter’s own entities are especially great.

Looking to express indicators of state intent also

polices against impostors. In Lake Country, a bistate

entity claimed to share California and Nevada’s

sovereign immunity, but neither agreed. 440 U.S., at

400-401. Compare PRPA, 531 F.3d, at 876 (noting

Puerto Rico filed brief “declaring that PRPA is an

arm of the Commonwealth”). Looking to the State’s

indications of its intent helps separate the entities it

had structured to include within its sovereign scope

(typically eligible for immunity) from those it did not

(ineligible).

Finally, while the ultimate sovereign immunity

question is federal, it is intertwined with state law.

Regents, 519 U.S., at 429 & n.5; see also Arkansas, 346

U.S., at 370 (“as we read Arkansas law the University

of Arkansas is an official state instrumentality”). And

the true arbiter of a State’s own law is the State

itself. Thus, particularly to the extent procedures like

certification are unavailable, courts must err on the

side of respecting a State’s express intent rather than

overruling the State’s understanding of its own law.

Cf. Pennhurst State Sch. & Hosp. v. Halderman, 465

U.S. 89, 106 (1984) (noting grave “intrusion on state

sovereignty” when court “instructs state officials on

how to conform their conduct to state law”). For this

reason, too, the inquiry must begin with whether New

Jersey structured NJ Transit to serve as its arm.

2. New Jersey plainly structured NJ Transit to

share in its sovereignty.

To start, consider how New Jersey characterizes NJ

Transit. The Legislature established NJ Transit as

“an instrumentality of the State,” in “the Executive

Branch,” established to perform “public and essential

governmental functions.” N.J. Stat. Ann. §27:25-4(a);

see id. §27:25-16 (similar). That is powerful evidence

that the Legislature intended to structure NJ Transit

as a sovereign arm—because it matches a preexisting

dividing line in the New Jersey Constitution between

“executive and administrative offices, departments,

and instrumentalities of the State,” N.J. Const. art. V,

§4, ¶1, and “municipal corporations formed for local

government” and “counties” that have distinct rights

and roles, id. art. IV, §7, ¶¶10-11. The state Supreme

Court thus describes the term “instrumentality” as

offering “unassailable” evidence of the Legislature’s

intent to create “a state agency,” Infinity Broad. Corp.

v. N.J. Meadowlands Comm’n, 901 A.2d 312, 318 & n.2

(N.J. 2006), as New Jersey courts have expressly

confirmed in NJ Transit’s case, see Colt Pet.App.14

(admitting that “state cases describe NJT as a state

agency” (citing N.J. Transit PBA Local 304 v. N.J.

Transit Corp., 675 A.2d 1180, 1181 (N.J. App. Div.

1996))); see also Muhammad, 821 A.2d, at 1153. Nor

is New Jersey unusual in using “instrumentality” in

this way. See Nebraska, 600 U.S., at 491 (finding that

MOHELA’s status as an “instrumentality” with public

purpose established Missouri’s standing); see also,

e.g., Arkansas, 346 U.S., at 370 (same, where state

high court had identified state university as “an

instrument of the state in the performance of a

governmental work” (citing Vincenheller v. Reagan, 64

S.W. 278, 284 (Ark. 1901)).

There is plentiful other evidence that New Jersey

designed NJ Transit as its arm, including delegating

to NJ Transit substantial plenary public powers. NJ

Transit can operate a police force, with jurisdiction

over “all criminal and traffic matters at all times

throughout the State.” N.J. Stat. Ann. §27:25-15.1(a).

NJ Transit can exercise eminent domain statewide,

and can condemn facilities of any “public or private

entity providing public transportation services within

the State.” Id. §27:25-13(a), (b), (h). NJ Transit’s

property is deemed untaxable property of the State.

Id. §27:25-16. And notably, NJ Transit can promulgate

regulations that have “the force and effect of law.” Id.

§27:25-5(e). Just as “Amtrak act[s] as a governmental

entity” for nondelegation purposes in issuing binding

rules, Dep’t of Transp. v. Ass’n of Am. R.R.s, 575 U.S.

43, 54 (2015), this and NJ Transit’s other powers

underscore that the entity has been “invested with”

substantial “political power” relating to “the administration of civil government” in the State, Dartmouth,

17 U.S., at 634.

In numerous other ways, New Jersey’s statutes

treat NJ Transit like other state agencies. They

subject the entity to public-meetings laws, N.J. Stat.

Ann. §27:25-4(g)(1), and to public-records laws, id.

§27:25-20(c) (NJ Transit records are “government

records”). And when NJ Transit adopts its binding

rules, it must follow the same NJAPA requirements

that bind virtually every state agency, id. §27:25-5(e),

and handle challenges to its actions with the same

special processes that govern challenges to state

agency decisions. See supra at 8-9; In re Protest of

Contract for Retail Pharm. Design, 314 A.3d 768, 777779 (N.J. 2024). And, like other state agencies, NJ

Transit is entitled to be represented by the New Jersey

Attorney General when it wishes, N.J. Stat. Ann.

§27:25-5(z), as it is here—confirming that the State

sees NJ Transit as its arm. A lawsuit against NJ

Transit thus “walks, talks, and squawks very much

like a lawsuit” against any other state agency. See

FMC, 535 U.S., at 757.

The list continues. NJ Transit can largely hire only

New Jersey residents, N.J. Stat. Ann. §52:14-7(a), and

must consult with state authorities in developing its

compensation schedule, id. §27:25-15. Its funds may

be deposited in a special trust fund only for “public

moneys,” id. §52:18A-90.4(a); see id. §27:25-5(p), and

NJ Transit’s books and records must be periodically

audited by the State Auditor, id. §27:25-20(e). See

Dep’t of Emp’t v. United States, 385 U.S. 355, 359

(1966) (Red Cross instrumentality of United States in

state-tax case because, inter alia, it was subject “to

governmental supervision and to a regular financial

audit by” U.S. Government). Time and again, the

Legislature treats NJ Transit like a state agency.

It is also clear that the Legislature believes NJ

Transit shares in its immunity. It specifically forbade

NJ Transit from asserting “sovereign immunity” as to

claims brought under a series of federal railroading

laws. N.J. Stat. Ann. §27:25-24.2. The only sensible

reading of that command, however, is that the State

intended for NJ Transit to share its sovereignty in the

first place, or there would be nothing for NJ Transit to

waive. See Burgos v. State, 118 A.3d 270, 287 (N.J.

2015) (disfavoring any statutory “interpretations that

render statutory language as surplusage”).

The New York court erred in declaring that “how the

State defines the entity and its functions” merely

“lean[ed] toward according NJT sovereign immunity,”

based on its view that state law’s “characterization of

NJT conflicts somewhat.” Pet.App.13-16. Against all

the textual and structural evidence of New Jersey’s

intent to create a sovereign arm as an instrumentality

in the Executive Branch to fulfill public purposes and

subject to the laws that govern state agencies, the Colt

majority mostly cited the NJTCA’s distinct definitions

for “public entities” (which covers NJ Transit) and

“State” (which does not). Id., at 15; see N.J. Stat. Ann.

§59:1-3. But this merely highlights the dangers of New

York courts overruling New Jersey’s own view as to

which entities share its own sovereignty. Terms “can

mean different things in different places,” including as

to immunities. Kohn, 87 F.4th, at 1032. That is the

case here: the NJTCA’s distinction between “public

entities” and “State” plays an entirely different role,

establishing which government entities categorically

must indemnify and defend their employees. Compare

N.J. Stat. Ann. §59:10A-1, with id. §59:10-5. It has no

bearing on which entities fall within the sovereignty

of the State, and which fall outside. See also id.

§59:1-3 (NJTCA also differentiating “Employee[s]”

from “State,” even as officers in their official capacity

still enjoy sovereign immunity). Indeed, another provision of the NJTCA specifically distinguishes “[l]ocal

public entities,” id. §59:10-4—yet another sign that NJ

Transit is a state entity, part of the Executive Branch,

and not a political subdivision.

New Jersey also evidenced its intent that NJ Transit

be its sovereign arm by creating NJ Transit to perform

delegated “public and essential governmental functions.” Id. §27:25-4(a). Colt doubted “whether operating an intrastate and interstate transportation

network is a traditional state governmental function,”

because private entities could “provide similar

services.” Pet.App.15 (but conceding that NJ Transit’s

status is “unique”). But whatever New York courts

believe to be proper public functions, New Jersey

has specifically found that its “provision of efficient,

coordinated, safe and responsive public transportation

is an essential public purpose,” and that it was thus a

“responsibility of the State” to provide it. N.J. Stat.

Ann. §27:25-2(a)-(b); see also supra at 19-20 (discussing state authority “to structure themselves as they

wish” to address their own public needs). Nor was New

Jersey’s conclusion surprising or unusual: This Court

has confirmed that Amtrak fulfills “governmental

goals” across cases. See Lebron v. Nat’l R.R. Passenger

Corp., 513 U.S. 374, 397 (1995); Am. R.R.s, 575 U.S.,

at 52-53. NJ Transit, just like this Court found

regarding Amtrak, does not “advanc[e] its own private

economic interests,” but the public’s. Am. R.R.s, 575

U.S., at 53.

Nor is there any merit to the suggestion that this

public function is insufficiently historically grounded

to divest NJ Transit of its arm-of-the-State status.

See Colt Pet.App.54 (Wilson, C.J., concurring).

Initially, it is unclear that such a test is applicable for

identifying sovereign entities, see, e.g., Nebraska, 600

U.S., at 491 (finding MOHELA’s education lending is

a “public function” without regard to whether States

engaged in loan servicing at the Founding), because a

central part of sovereignty is the ability to innovate

and respond to the “needs of a heterogeneous society,”

Gregory, 501 U.S., at 458. Indeed, this Court has

already rejected the idea of judges deciding which

sovereign functions are “integral” or “traditional” as

“unsound in principle and unworkable in practice,”

Garcia v. San Antonio Metro. Transit Auth., 469 U.S.

528, 546-547 (1985). More fundamentally, this Court’s

recognition that public transportation serves a public

function is consistent with history. Sovereigns have

facilitated transportation for millennia—going back

to the Roman Empire’s road construction. See, e.g.,

Joseph Berechman, Transp.—Econ. Aspects of Roman

Highway Development: The Case of Via Appia, 37

Transp. Rsch. Part A: Policy & Practice 453, 454

(2003). Nor was that public good far from the Framers’

minds: the Constitution establishes a federal power to

establish post roads, U.S. Const. art. I, §8, cl. 7, and

the 1817 Erie Canal project “served as a model for

similar state transport enterprises elsewhere in the

nation,” Harry Scheiber, State Law & “Industrial

Policy” in Am. Dev., 75 Calif. L. Rev. 415, 420-421

(1987); see also Harry Scheiber, The Transp.

Revolution & Am. Law: Constitutionalism & Public

Policy, in Transp. & the Early Nation 19-21 (1981).5

New Jersey built upon this tradition in assigning this

essential public function to NJ Transit, a state

instrumentality in its Executive Branch.

B. State Control Over The Entity.

Because all NJ Transit Board members are subject

to gubernatorial appointment and removal, and all of

their actions are subject to gubernatorial veto, control

overwhelmingly supports NJ Transit too.

That the specific activity at issue here—driving a bus—is also

performed by private companies makes no difference. Ex Parte

New York, 256 U.S. 490 (1921), for example, extended sovereign

immunity to admiralty suits, even though the particular action

there was operating a tugboat. Id., at 495. And undisputedly

sovereign entities also employ drivers and others who perform

duties available on the open market, yet do not lose sovereignty

as to those activities. For good reason: “[t]he status of an entity

does not change from one case to the next.” PRPA, 531 F.3d, at

873; Kohn, 87 F.4th, at 1031 (noting the contrary “activity-based

approach would allow parties to relitigate an entity’s immunity

by articulating the challenged activity at a different level of

generality,” “undermining the very purpose of immunity”).

1. Since the Founding, this Court has considered the

sovereign’s control over an entity when assessing its

status. As early as Schooner Exchange, this Court

reasoned that a “public armed ship” was an extension

of a foreign sovereign not just because of the “national

objects” that ship served, but because it “act[ed] under

the immediate and direct command of the sovereign.”

11 U.S., at 144. Dartmouth, by contrast, fell outside

New Hampshire’s reach because it had been founded,

maintained, and governed by private individuals for

their own purposes—unlike an institution “founded by

government, and placed entirely under its immediate

control, the officers of which would be public officers,

amenable exclusively to government.” Dartmouth, 17

U.S., at 631-635, 640-641.6

This Court’s modern precedents have likewise

looked to direct State control to assess shared immunity. Mt. Healthy, for example, found that a school

board was not an arm of Ohio because—though it

received “guidance from the State Board of Education”

and funding from Ohio—the board was independent of

state control, with its own extensive authority to issue

bonds and to levy taxes. See 429 U.S., at 280 (noting

this made it “more like a county or a city than … an

arm of the State”). So too in Lake Country, where the

Court emphasized—in denying sovereign immunity to

Beyond intent, the absence of control also undergirded this

Court’s series of rulings finding state-connected banks did not

qualify as agents of those States. See Bank of U.S. v. Planters’

Bank of Ga., 22 U.S. (9 Wheat.) 904, 907-908 (1824) (concluding

that Georgia “waive[d] all the privileges of [its sovereign]

character” for bank where it held a noncontrolling interest and

just “act[ed] merely as a corporator,” exercising essentially “no

other power in the management of the affairs of the corporation”);

Briscoe, 36 U.S., at 325-326 (similar); Wister, 27 U.S., at 323-324

(similar).

a bistate agency—that the majority of that agency’s

governing members were “appointed by counties and

cities, and only 4 by the 2 States.” 440 U.S., at 401; see

also Hess, 513 U.S., at 44 (considering that “8 of the

Port Authority’s 12 commissioners must be resident

voters of either New York City or other parts of the

Port of New York District”).

This Court’s decisions in related contexts confirm

the role of control. Nebraska held that MOHELA was

part of Missouri for standing purposes, emphasizing

not only its “public purpose,” but also its governance

“by state officials and state appointees,” and the statelaw requirements that it “report[] to the State.” 600

U.S., at 491. And Lebron likewise found Amtrak to be

part of the Federal Government for First Amendment

purposes (despite federal laws denying it government

status) because the Federal Government had created

Amtrak by special law in order to serve “governmental

objectives” and had retained “authority to appoint a

majority of the directors of that corporation.” 513 U.S.,

at 399; see also Am. R.R.s, 575 U.S., at 54-55 (similar,

rejecting private non-delegation challenge).

This Court has long looked to control for good

reason. For one, a State’s choice to retain close control

over the entity is a strong sign the State believes it

falls within its sovereignty. After all, one indicator of

entities that fall within the scope of the sovereign is

the sovereign’s ability to resolve internal disputes

without resort to litigation. See Lake Country, 440

U.S., at 402 (that entity was “not in fact an arm of the

State” was “perhaps most forcefully demonstrated” by

State having “resorted to litigation in an unsuccessful

attempt to impose its will on” the entity); compare Va.

Off. for Prot. & Advoc. v. Stewart, 563 U.S. 247, 264

(2011) (VOPA) (Kennedy, J., concurring) (observing

“striking novelty of permitting a state agency to sue

officials of the same State in federal court”). Not only

that, but control over an entity means accountability

for that entity, and a hallmark of sovereignty in our

American tradition is political accountability for the

government’s actions. Cf. Seila Law LLC v. CFPB, 591

U.S. 197, 224 (2020); Federalist No. 46, at 294-295

(Madison) (Clinton Rossiter ed., 1961). If an agency is

controlled by the State’s officials, it is accountable to

those officials—and through them, to the statewide

citizenry. See, e.g., PRPA, 531 F.3d, at 877-878.

For another, control—and, relatedly, statewide

accountability—serves as a tool to distinguish arms of

the State from other entities, such as municipalities,

private corporations, and any interstate entities not

entitled to their creators’ sovereignty. Even though

localities are often created by state laws and exercise

States’ police powers, localities are accountable to just

a slice of the State’s citizens. See, e.g., Lincoln County

v. Luning, 133 U.S. 529, 530-531 (1890) (county was

“part of the state only in that remote sense in which

any city, town, or other municipal corporation may be

said to be”).7 Bistate entities are accountable to more

than just one sovereign’s voters. See Hess, 513 U.S., at

40-42 (presumption that interstate agencies lack

immunity). And private corporations are accountable

only to shareholders or private parties, not the State.

See, e.g., Dartmouth, 17 U.S., at 632-635.

2. Evidence that New Jersey controls NJ Transit is

overwhelming. Initially, NJ Transit is subject to the

Indeed, control provides a better distinction than the entity’s

geographic authority, because sovereigns will sometimes focus on

regional undertakings in service of the State’s broader public

goals. See, e.g., PRPA, 531 F.3d, at 875-876. That is academic

here, however, because NJ Transit operates statewide.

Governor’s appointment and removal powers, a classic

sign of government status. This Court has emphasized

the President’s powers to appoint and to remove board

members in finding that Amtrak had governmental

status for the non-delegation and First Amendment

claims in American Railroads, 575 U.S., at 55, and

Lebron, 513 U.S., at 397-398. So too as to MOHELA,

600 U.S., at 490-491, and the University of Arkansas,

346 U.S., at 370.

Appointment and removal demonstrates control

here too. The Governor appoints all members of NJ

Transit’s Board, and many are subject to advice-andconsent by the state Legislature. All are subject to

removal, whether at-will or for-cause. N.J. Stat. Ann.

§27:25-4(b). The Transportation Commissioner (a state

cabinet member) chairs the NJ Transit Board. Id.

§§27:1A-2, 27:1A-4, 27:25-4(d). This Court has already

recognized these features as creating political accountability for corporations like Amtrak. See Lebron, 513

U.S., at 398-399 (noting even ability to appoint a

majority of Amtrak’s board members supported public

status). NJ Transit is thus easily distinguished from

entities whose members are appointed by localities,

compare Lake Country, 440 U.S., at 401-402, or who,

as private corporations, are not accountable to the

state citizenry at all, compare Dartmouth, 17 U.S., at

626, 632-635 (trustees could fill vacancies and pick

successors).

That the Governor’s removal power is largely “for

cause” in no way undermines arm-of-the-State status.

For one, the lack of any statutory language providing

for the removability of Amtrak board members did

not undermine government status in the First

Amendment context. Lebron, 513 U.S., at 398-399. For

another, while the fact that an entity’s head is

removable for cause might cut against control in a

State wholly structured around a unitary executive, it

is consonant with control where even some cabinet

officials like the Attorney General and the Secretary

of State are insulated. N.J. Const. art. V, §4, ¶¶1-3, 5.

This inquiry thus again requires sensitivity to States’

choices on how to structure their governments, and

confirms the dangers of one State’s courts ignoring the

creator State’s express intent.

But even setting aside appointment and removal as

proxies for control, the Governor has a direct veto over

NJ Transit’s actions. Compare Hess, 513 U.S., at 44

(gubernatorial veto supported immunity), with Auer

v. Robbins, 519 U.S. 452, 456 n.1 (1997) (lack of

“direction or control” cut against state status for local

board of police commissioners); Lake Country, 440

U.S., at 402 (that rules “not subject to veto at the state

level” undermined arm-of-the-State status). For NJ

Transit’s Board to take any official act, it must convey

the minutes of its meetings to the Governor. N.J. Stat.

Ann. §27:25-4(f). All Board action faces a ten-day

waiting period, when the Governor can veto the action,

offer approval, or take no action (allowing it to take

effect). See id. Such provisions serve “to provide the

Governor with direct executive control” over state

instrumentalities. In re Veto by Gov. Chris Christie, 58

A.3d 735, 742 (N.J. App. Div. 2012). Subjecting NJ

Transit to a plenary gubernatorial veto is yet another

compelling indication that NJ Transit is nothing like

a private company or local government.

Additional controls reinforce this conclusion. State

law allows the Legislature to demand that NJ Transit

appear before it to present testimony, provide

documents, and respond to questions. N.J. Stat. Ann.

§27:25-5.25(a). The Legislature can also veto certain of

NJ Transit’s eminent-domain actions. Id. §27:2513(h). And the Legislature controls who NJ Transit

hires and how—restrictions that are, of course,

consistent with governmental rather than private

status. Supra at 23. All of these additional controls

only underscore NJ Transit’s status.

That the New York Court of Appeals believed

control did “not weigh heavily in either direction,” Colt

Pet.App.17, is untenable. The Colt court mostly

emphasized that NJ Transit is “independent of any

supervision or control by” the State’s Department of

Transportation. See Pet.App.16 (quoting N.J. Stat.

Ann. §27:25-4(a)). But that again illustrates the

dangers of one State’s court assessing the status of

another State’s entity—instead of deferring to the

latter’s characterizations—since that court badly

misunderstood New Jersey law. Making an agency

independent of a department in which it sits is a statelaw quirk, because the New Jersey Constitution caps

the number of Executive Branch “departments” at

twenty. N.J. Const., Art. 5, §4, ¶1. Because the Legislature has nevertheless created more than twenty

executive agencies, it will formally place any new

agencies “in” another state department “to satisfy the

Constitution,” but sometimes clarify that the new

agency is not functionally part of that department’s

chain of command by making it (among other formulations) “‘independent of any supervision or control’ of

the department where [it is] located.’” In re Plan for

Abolition of Council on Affordable Hous., 70 A.3d 559,

570-571 (N.J. 2013) (citing examples). But the relevant legal question is whether the entity is subject to

state control, not that of a particular executive agency.

And an agency like NJ Transit that is within another

state department but outside of that department’s

authority is nonetheless still part of the overall

Executive Branch, and subject to the control of its

Chief Executive, see id., at 572—including, for NJ

Transit, through the above-discussed appointment,

removal, and veto powers.

The New York court likewise erred in relying on a

state law requiring Board members to “exercise their

‘independent judgment in the best interest of [NJ

Transit], its mission, and the public’” in exercising

their authority. Pet.App.16 (quoting N.J. Stat. Ann.

§27:25-4.1(b)(1)). As this Court explained last Term, a

statutory instruction to be “‘independent’ … means at

most that [board] members can exercise independent

judgment in generating recommendations on the front

end,” not that they fall outside traditional Executive

control. Kennedy v. Braidwood Mgmt., Inc., 145 S. Ct.

2427, 2450 (2025) (discussing similar instructions for

federal officials). What matters is that their exercise

of that judgment is still subject to back-end review by

politically accountable superiors: in Braidwood, the

U.S. Secretary of Health, id.; here, the Governor. If

anything, this law supports NJ Transit, emphasizing

yet again that NJ Transit is not accountable to private

interests but to the people of New Jersey.

C. The State’s Financial Relationship With

The Entity.

Financial considerations can also clarify a State’s

relationship with the disputed entity, and here they

further support NJ Transit’s arm-of-the-State status.

Colt’s contrary holding rested on two errors: looking

only to the State’s formal liability for legal judgments,

and giving that fact outsized importance.

Precedent and first principles explain why courts

look to the overall financial relationship between the

sovereign and the entity in assessing the latter’s arm-

of-the-State status, especially when other “indicators

of immunity point in different directions.” Hess,

513 U.S., at 47. First, it yet again indicates “the

relationship between the State and its creation.”

Regents, 519 U.S., at 431. On top of characterization,

structure, and control, the extent of a State’s fiscal ties

with the entity can shed light on whether it intended

the entity to be a sovereign arm. Second, even though

“the primary function of sovereign immunity is … to

afford the States the dignity and respect due sovereign

entities,” FMC, 535 U.S., at 769, immunity also

protects States from financial injuries, id., at 765. If a

state-funded entity is liable in another sovereign’s

courts, such a judgment inflicts “the same practical

consequences as a judgment against the State itself.”

Lake Country, 440 U.S., at 401.

NJ Transit is financially integrated with the State

and financially dependent on it. Although New Jersey

is not formally liable for NJ Transit’s debts, N.J. Stat.

Ann. §27:25-17, in statutory design and in practice the

entity depends on state funding. State law requires NJ

Transit, before each appropriations cycle, to “make

an annual report of its activities for the preceding

fiscal year,” which includes “a complete operating

and financial statement covering its operations and

capital projects during the year,” id. §27:25-20(b); an

annual report about its real property, id. §27:25-20(f);

and a “proposed budget recommendation,” id. §27:2520(g). See Nebraska, 600 U.S., at 490-491 (discussing

MOHELA’s financial-reporting requirements); Am.

R.R.s, 575 U.S., at 52 (discussing Amtrak’s reporting

and budget oversight).

The State has also consistently appropriated sums

to NJ Transit throughout its history. At its creation,

the Legislature appropriated NJ Transit’s full initial

operating budget. See N.J. Dep’t of Treasury, Appropriation Handbook: Fiscal Year 1979-1980, at 363-364

(1979). The Governor added that the Department of

Transportation would “maintain budgetary control

over the Corporation’s capital and operating

expenses.” Press Release, Office of the Governor (July

17, 1979). A $475 million voter-approved bond in 1979

funded the entity’s first acquisitions.8 And the

Legislature has continued to fund NJ Transit ever

since, including nearly $19 billion in state resources

since 1984 for NJ Transit’s capital projects alone.9

The Legislature continues to financially backstop

NJ Transit, as its fare receipts and other revenues do

not come close to covering its operating expenses. Over

the last 35 fiscal years, the Legislature subsidized

between 15 and 40 percent of NJ Transit’s operating

budget. For fiscal year 1991, for example, it appropriated $218.5 million, or approximately 32% of NJ

Transit’s operating budget.10 For 2011, the number

was $276 million (roughly 15%).11 And for 2026, the

Legislature appropriated nearly $1.5 billion (about

46%). See FY2026 Appropriations Act, at 2, 259-261.

Combined with the $767 million that the Legislature

appropriated for NJ Transit’s capital projects, the

State’s total subsidy for NJ Transit this fiscal year will

be approximately $2.2 billion. See id. Given NJ

Transit’s reliance on state funding to function, a legal

Joseph Sullivan, Jersey Transit Bonds Pass, N.Y. Times, Nov.

7, 1979, https://tinyurl.com/cz2ukdy4.

NJDOT/NJ Transit Capital Program, N.J. TTFA (Feb. 21,

2025), https://www.nj.gov/ttfa/capital/.

NJ Transit, Annual Report 1992, at 19 (1992).

NJ Transit, FY 2012 Consolidated Financial Statements 12

(2012), https://dspace.njstatelib.org/server/api/core/bitstreams/87

165a79-e4c3-4134-8e9a-5a236ef1e5bc/content

judgment against NJ Transit would “necessarily”

impact New Jersey “itself.” Nebraska, 600 U.S., at 491.

That financial reliance directly results from how

New Jersey has chosen to structure NJ Transit. The

Legislature sharply limited NJ Transit’s ability to

incur debt: with one narrow exception, NJ Transit is

prohibited from incurring any “liability or obligation”

“beyond the extent to which moneys are available.”

N.J. Stat. Ann. §27:25-17; see id. §27:25-5(w). That

renders NJ Transit unable to issue bonds in its

name—unlike New Jersey localities, id. §40A:2-3, and

unlike private businesses. And even as NJ Transit can

seek federal and other grants, id. §27:25-5(g), it must

typically rely on other state instrumentalities—like

the State’s Transportation Trust Fund Authority—to

secure such financing for capital projects, or make up

shortfalls in federal funding, id. §27:1B-21.6, -21.9; see

supra at 9-10. And the State’s TTFA, for its part, uses

state appropriations to support that bonding activity.

See id. §§27:1B-7, 27:1B-9.12

Nor is NJ Transit free to maximize fare revenue or

minimize costs in the way private businesses do. State

law mandates certain NJ Transit services, including

reduced “fares for senior citizens, persons with

disabilities, and all disabled veterans at State

expense.” Id. §27:1A-66. And if NJ Transit wants to

curtail rail service or implement fare hikes, it must

hold at least two public hearings (ten for fare hikes)

under specific conditions, id. §27:25-8(d); respond to

public comments, id.; and secure gubernatorial assent,

see id. §27:25-4.1(a); supra at 31.

See also Flow of Funds, N.J. TTFA (Aug. 12, 2020), https://

www.nj.gov/ttfa/financing/flowfunds.shtm.

These constraints make NJ Transit a far cry from

the Port Authority that this Court found to lack

immunity in Hess. Beyond functioning as a bistate

agency subject to the “significantly different position”

of such entities, see 513 U.S., at 40, the Port Authority

had “anticipated and actual financial independence,”

id., at 49, because it could “borrow money and secure

the same by bonds or by mortgages,” id., at 35,

“generate[] its own revenues,” and “for decades [had]

received no money from the States,” id., at 45-46

(discontinuation of state appropriations in 1934).

By contrast, NJ Transit’s situation is comparable to

“transit facilities that place heavy fiscal tolls on their

founding States”—entities that Hess recognized could

have immunity. Id., at 49. Hess contrasted two such

entities with the Port Authority: Alaska’s “thinly

capitalized railroad that depends for its existence on a

state-provided ‘financial safety net,’” and WMATA,

which was likewise “dependent on funds from the

participating governments to meet its sizable

operating deficits.” Id., at 49-51 (citing Alaska Cargo

Transp., Inc. v. Alaska R.R. Corp., 5 F.3d 378 (CA9

1993), and Morris v. WMATA, 781 F.2d 218 (CADC

1986)). Hess specifically suggested the circuit rulings

finding immunity for each entity could stand. Id. &

n.20; see also Am. R.R.s, 575 U.S., at 53, 55 (noting

Amtrak is “dependent on federal financial support,”

and citing such “practical” control of its annual budget

as affirmative evidence of governmental status). Here

too, NJ Transit operates as an “instrumentality” with

some fare-setting authority, but limited power to issue

debt; a fisc “dependent upon and controlled by the will

of the governor and the legislature,” Alaska Cargo, 5

F.3d, at 381; and deficits heavily subsidized by its

creator every year, see Morris, 781 F.2d, at 226.

Colt reached a contrary conclusion based on two

errors: treating the sole issue as whether New Jersey

has formal liability for money judgments against NJ

Transit, and over-relying on this issue. As to the

former, the financial analysis does not end with

whether a State has “legal” or “ultimate liability” for

judgments against the entity. Contra Colt Pet.App.18.

Although the fact that a “money judgment against a

state instrumentality … would be enforceable against

the State is of considerable importance” as one way to

show the State’s financial interests are harmed, this

Court has rebuffed efforts to “convert the inquiry into

a formalistic question of ultimate financial liability.”

Regents, 519 U.S., at 430-431; see also Lake Country,

440 U.S., at 401 (looking as well to the “practical

consequences” of a potential judgment).13

Instead, courts look to the State’s and the entity’s

broader financial relationship, of which formal legal

liability is just one part. The core aim of the arm-ofthe-State analysis is to determine which unconsentedto suits offend the sovereign’s dignity. See FMC, 535

U.S., at 769; supra at 19. But the State’s choice to

make entities liable for their own judgments—while

financially supporting them—reflects a policy choice,

not a sign the State has removed the entity from its

sovereignty. See Regents, 519 U.S., at 431 (assessing

overall “relationship” of entity and sovereign); supra

at 19-20 (noting importance of state experimentation

Colt went even further astray when asking whether New

Jersey would be formally liable for a specific judgment “in this

case.” Pet.App.18. “An entity either is or is not an arm,” PRPA,

531 F.3d, at 873; see supra n.4, and regardless, status does not

turn on financial liability for one specific judgment, Regents, 519

U.S., at 429-431 (university not precluded from being arm of

California just because damages would have been indemnified).

and need to avoid regime limiting States’ internal

discretion). Exclusively focusing on formal liability in

the name of protecting the sovereign fisc would thus

be perverse, as it would mean that efforts to conserve

taxpayer funds in form (by dividing up liabilities and

bank accounts) would actually make such funds more

vulnerable in practice.

Even with respect to sovereign immunity’s second

aim of protecting the state fisc, see Hess, 513 U.S., at

49, the overall financial relationship between a State

and its entity—and the “practical consequences” that

flow from that structure, Lake Country, 440 U.S., at

401—offer better insight than an inquiry into formal

liability alone. After all, a judgment against the entity

can have “essentially the same practical consequences

as a judgment against the State itself,” id., not just if

a State must formally pay up, but also when the State

supports (in whole or in part) the entity’s budget. It is

illogical to make conclusive a state law that obligates

the State to pay a large share of an entity’s liabilities,

but treat as irrelevant a structure wherein the State

regularly covers a large share of the entity’s budget.

See Hess, 513 U.S., at 51 (immunity should be

assessed “legally and practically”). That is why Hess—

even as it noted the Port Authority’s lack of reliance

on its States—distinguished “transit facilities that

place heavy fiscal tolls on their founding States.” Id.,

at 49; Nebraska, 600 U.S., at 490 (noting “financial

harm” to MOHELA can injure Missouri despite legal

separation between their treasuries); PRPA, 531 F.3d,

at 878-880.

At the very least, Colt erred in allowing formal

financial liability to overcome the more powerful

statutory evidence of state intent and control. In

recent years, this Court has emphasized—based on

Founding-era evidence—that the “primary function of

sovereign immunity is not to protect state treasuries,

… but to afford the States the dignity and respect due

sovereign entities.” FMC, 535 U.S., at 769. It could

hardly be otherwise, as sovereign immunity applies to

claims seeking non-monetary and monetary relief

alike—and the arm-of-the-State test applies to both.

See P.R. Aqueduct & Sewer Auth. v. Metcalf & Eddy,

506 U.S. 139, 146 (1993). So although financial

considerations can have “considerable importance,”

Regents, 519 U.S., at 430, as a “sufficient condition” for

finding sovereign immunity (because they reveal harm

to the state fisc), they can never be a “necessary

condition” (given the other ways in which the suit can

harm state dignity), PRPA, 531 F.3d, at 879. So long

as New Jersey has structured NJ Transit to share its

sovereignty, it matters little how the State structured

its bank accounts. That is dispositive: a suit against

NJ Transit offends New Jersey’s sovereignty because

the State made the entity one of its instrumentalities,

in its Executive Branch, for essential public purposes,

bound by extensive gubernatorial control, and reliant

on state funding—even as it formally separated NJ

Transit liabilities from the overall state treasury.

D. Sue-And-Be-Sued Clauses.

Nor does the result change just because state law

created NJ Transit as a “body corporate and politic”

that can “sue and be sued” in its name. N.J. Stat. Ann.

§§27:25-4(a), 27:25-5(a). Pivoting from the inquiry

above, the Colt Respondents have suggested that this

Court scrap its traditional arm-of-the-State considerations and impose a new rule—assertedly from original

meaning—that makes such provisions dispositive. See

Colt BIO.21-22 (citing Springboards to Educ., Inc. v.

McAllen Indep. Sch. Dist., 62 F.4th 174, 188 (CA5

2023) (Oldham, J., concurring); PRPA, 531 F.3d, at

881 (Williams, J., concurring)). But that rule does not

actually identify state arms, contravenes longstanding

precedent, and misconstrues history. Instead, while

such provisions regularly bear on whether a State

waived its entity’s immunity, they have no talismanic

effect on whether that entity is an arm of the State in

the first place.

Initially, formal corporate status or a sue-and-besued clause cannot resolve which entities can share

their creators’ sovereignty. Consistent with a need to

protect States from the indignity of suits without

consent, see supra at 4-5, 19, this Court has long

looked “behind and beyond the legal form” of the case,

Arkansas, 346 U.S., at 371, to consider whether the

claim—whether styled against a specific entity or

official—truly “operate[s] against the [State].” Pennhurst,

465 U.S., at 101; see Dugan v. Rank, 372 U.S. 609, 620

(1963) (asking if claims would effectively “restrain the

Government from acting, or [] compel it to act”). So if

States actually did use such clauses to indicate

entities that lack sovereign status, then suits could

proceed against such entities with little offense. But if

States use such provisions in other ways, that

proposed rule would subject States to unconsented-to

suits.

That is fatal, because States do not employ such

clauses to indicate a lack of sovereignty. Instead,

especially as administrative systems grew in the early

twentieth century, multiple States sought to “cut[] ‘red

tape’” and “escap[e] the traditionalism of bureaucratic

administration” by experimenting with corporate,

sue-and-be-sued status. Oliver Field, Government

Corporations: A Proposal, 48 Harv. L. Rev. 775, 776777 (1935). These entities were not profit-making

entities, but “[p]ublic administrative agencies of a

traditional type” that were nevertheless “organized in

the corporate form.” Id., at 778. In other words, they

were corporations “create[d] … by special law, for the

furtherance of governmental objectives,” Lebron, 513

U.S., at 400—sovereign agencies like any other, with

a new form to foster efficiency.

States have thus established a range of executive

departments as bodies corporate and/or with sue-andbe-sued status. That includes, inter alia, Departments

of Corrections, Mo. Ann. Stat. §217.020(2); Wis. Stat.

§301.04; Departments of Transportation, Fla. Stat.

§334.044(8); Ga. Code Ann. §32-2-5(a); Utah Code

Ann. §72-1-207(1); and a Gaming Control Board,

4 Pa. Cons. Stat. Ann. §1202(b)(3). It includes nearly

the entire Louisiana cabinet, including the State’s

Treasury, Revenue, Justice, Public Safety, Children

and Family Services, and State departments. E.g.,

La. Stat. Ann. §§36:401, 36:451, 36:471, 36:701,

36:741, 36:761. And the list goes on. E.g., Alaska Stat.

§43.31.091 (Department of Revenue); id. §44.83.020

(Energy Authority); 20 Ill. Comp. Stat. 3805/4, 7.8

(Housing Development Authority); Minn. Stat. §462A.06

(Housing Finance Agency); Tex. Gov’t Code Ann.

§§1232.051, 1232.067(3) (Public Finance Authority); id.

§2306.053(b)(1) (Department of Housing & Community

Affairs); Wash. Rev. Code. §§43.180.040, 43.180.080(2)

(Housing Finance Commission); Wis. Stat. §101.02(2)

(Department of Safety and Professional Services).

Real-world practice therefore makes clear that a

State’s decision to use a sue-and-be-sued clause or the

corporate form does not remove the entity from the

State’s sovereign scope.

This Court’s precedents have likewise acknowledged

these entities can be sovereign arms. This Court

confronted a contract suit against such an entity in

1929. State Highway Comm’n v. Utah Constr. Co., 278

U.S. 194. Wyoming’s State Highway Commission had

a sue-and-be-sued clause, id., at 196, but this Court

nevertheless found that the “suit, in effect, [was]

against the state and must be so treated”—finding it

was “unnecessary … to consider the effect of the

general grant of power to sue or be sued,” id., at 199.

And the Court has made the same point ever since,

looking to the actual nature of the entity rather than

the presence or absence of such a clause, see supra at

18-20, and confirming that a State does not “consent

to suit in federal court merely by stating its intention

to ‘sue and be sued,’” Coll. Savs. Bank v. Fla. Prepaid

Postsec. Educ. Expense Bd., 527 U.S. 666, 676 (1999)—

a conclusion presupposing sovereign immunity to

waive in the first place.

Nor has this point been limited to state sovereign

immunity. This Court explained in Nebraska that

having a “legal personality separate from the State,”

including the power “to sue and be sued,” does not

foreclose the particular entity from being “part of the

Government.” 600 U.S., at 492. This Court reached the

same conclusion in Arkansas, where—even as the

University of Arkansas’s board had corporate status—

this Court “read Arkansas law” to establish it as “an

official state instrumentality,” such that “any injury to

the University is an injury to Arkansas.” 346 U.S., at

370. That is, this Court looked “behind and beyond the

legal form” in each case, id., at 371, to ask whether the

suit implicated a sovereign state entity.

History does not support plaintiffs either. To start,

early precedent makes clear that corporate status was

no poison pill to sovereign status. As Chief Justice

Marshall explained in Dartmouth, rather, “[t]he

character of civil institutions does not grow out of their

incorporation, but out of the manner in which they are

formed, and the objects for which they are created,”

and an “incorporating act neither gives nor prevents

[governmental] control.” 17 U.S., at 638. All of which

coheres with this Court’s time-honored approach of

looking to “the nature of the entity,” Mt. Healthy, 429

U.S., at 280—a nature that establishes NJ Transit as

an arm of the State.14

Nor is there merit to the argument that because

municipalities lacked immunity at the Founding and

are themselves separate legal persons, other entities

with corporate status or sue-and-be-sued clauses also

must lack immunity. See Springboards, 62 F.4th, at

198 (Oldham, J., concurring). To start, the premise is

incorrect. Many municipalities in the early Republic

were not formally incorporated, and it was not until

the early nineteenth century that such municipalities

became more commonplace. See Gerald Frug, City

Making: Building Communities Without Building

Walls 36-38 (1999). English law never incorporated

counties at all—they instead reflected administrative

districts for the sovereign’s convenience. See Joan

Williams, The Invention of the Municipal Corporation:

A Case Study in Legal Change, 34 Am. U. L. Rev. 369,

382 & n.77 (1985); Sidney & Beatrice Webb, English

Nor is corporate status inherently inconsistent with sovereignty. Several States began as corporations, and Connecticut

and Rhode Island continued to use their colonial-era corporate

charters as basic laws following Independence. See Nikolas

Bowie, Why the Constitution Was Written Down, 71 Stan. L. Rev.

1397, 1407, 1498 (2019); see also Dixon v. United States, 7 F. Cas.

761, 763 (C.C.D. Va. 1811) (Marshall, C.J.) (describing United

States as a “grand corporation which the American people have

formed”); 1 Blackstone, Commentaries *469 (describing King as a

“sole corporation”).

Local Gov’t From the Revolution to the Mun. Corps.

Act: The Parish & the County 305-307 (1906). Yet all

agree that U.S. counties lack sovereign immunity. See

Lincoln County, 133 U.S., at 530.

Instead, municipal corporations’ lack of immunity

reflects broader origins and characteristics that

differentiate them from state-created sovereign

entities—and cannot be reduced to corporate form or

sue-and-be-sued status. For one, local governments’

territorial scope makes them answerable to the

“peculiar and special advantage and convenience” of

their residents, rather than the State at large. Soper

v. Henry County, 26 Iowa 264, 267 (1868) (Dillon, C.J.).

For another, municipal corporations historically

possessed at least some self-determination rights

that could be wielded against the King. See 1

Blackstone, Commentaries *473 (describing London as

a “corporation by prescription” that existed since time

immemorial); Magna Carta ch. 13 (1215), in J.C.

Hoult, Magna Carta (3d ed. 2015) (preserving

London’s “ancient liberties and free customs”). That

helps explain why English and early American law

treated municipal corporations as “on the same ground

… as individuals” and thus lacking immunity, while

“quasi corporations, created by the legislature for

purposes of public policy” were liable only if the

sovereign had made them so. Mower v. Inhabitants of

Leicester, 9 Mass. 247, 250 (1812).

A doctrine that makes such provisions the end-allbe-all thus errs twice-over as a matter of original

understanding. It takes a criterion that was not true

of all municipalities and counties, yet makes it the

dispositive way to distinguish between state and local

entities. And it ignores the many other reasons

localities are different, including their historical

pedigrees, the sovereign’s view of their separateness,

and their lack of statewide accountability and control.

That is why—even as modern law sees municipalities

as creatures of their States, dissolvable by the States

at will—canonical opinions suggested municipal corporations might still independently wield certain

rights against their States. See Hunter v. City of

Pittsburgh, 207 U.S. 161, 179 (1907). And it explains

why legal challenges between States and municipalities are much more common than fights between

intrastate agencies. Compare, e.g., Washington v.

Seattle Sch. Dist. No. 1, 458 U.S. 457, 459 (1982), with

VOPA, 563 U.S., at 263-264 (Kennedy, J., concurring).

So subdivisions are not eligible to share this

immunity, but state entities “create[d] … by special

law, for the furtherance of governmental objectives”

and subject to state control, Lebron, 513 U.S., at 400,

remain so eligible.

To be clear, a sue-and-be-sued clause is relevant,

but primarily as to the “second-stage” question of a

sovereign’s waiver of its immunity. Kohn, 87 F.4th, at

1031. In the federal context, sue-and-be-sued clauses

help show whether or to what degree Congress waived

the immunity to which a sovereign entity otherwise is

entitled. See, e.g., Thacker v. Tenn. Valley Auth., 587

U.S. 218, 221, 223 (2019) (noting the TVA was an

entity that “would have enjoyed sovereign immunity

from suit” but that Congress’s employment of a sueand-be-sued clause “waived at least some of the

corporation’s immunity”). The same logic applies to

state immunity, where a sue-and-be-sued clause does

not even automatically reflect “consent to suit in

federal court,” much less a lack of immunity at all.

Coll. Savs. Bank, 527 U.S., at 676. Plaintiffs thus

conflate the presence of immunity with what is often

only a partial waiver of that immunity. That is no

basis to overcome the mountain of evidence that NJ

Transit is an arm of the Garden State.

CONCLUSION

This Court should reverse the judgment of the New

York Court of Appeals and affirm the judgment of the

Pennsylvania Supreme Court.

Respectfully submitted,

KATHERINE L. PRINGLE

SCOTT H. HENNEY

FRIEDMAN KAPLAN SEILER

ADELMAN & ROBBINS LLP

7 Times Square

New York, NY 10036

MATTHEW J. PLATKIN

Attorney General

JEREMY M. FEIGENBAUM*

Solicitor General

MICHAEL L. ZUCKERMAN

Deputy Solicitor General

JEAN P. REILLY

DANIEL M. VANNELLA

Assistant Attorneys General

NATHANIEL F. RUBIN

AMY CHUNG

MARIE CEPEDA MEKOSH

BRETT HAROLDSON

LEVI KLINGER-CHRISTIANSEN

JONATHAN W. ALLEN

BETHANNE PRUGH

Deputy Attorneys General

OFFICE OF THE ATTORNEY

GENERAL OF NEW JERSEY

25 Market Street, Box 080

Trenton, NJ 08625

(862) 350-5800

jeremy.feigenbaum@njoag.gov

Counsel for Petitioners

* Counsel of Record

September 3, 2025

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.