Vol. 14, No. 2, Pg. 48. U.S. Supreme Court reinforces the armor of the states' sovereign immunity.

• Author: By Elizabeth Herlong Campbell

South Carolina Lawyer

2002.

Vol. 14, No. 2, Pg. 48.

U.S. Supreme Court reinforces the armor of the states' sovereign immunity

48U.S. Supreme Court reinforces the armor of the states' sovereign immunity

Federal Maritime Commission v. Carolina State Ports Authority, decided May 28, 2002 By Elizabeth Herlong CampbellIn a landmark decision, the U.S. Supreme Court again reinforces the armor of the states' sovereign immunity. In Federal Maritime Commission v. South Carolina State Ports Authority, 122 S. Ct. 1864 (2002), the Supreme Court decided whether state sovereign immunity precludes the Federal Maritime Commission ("Commission" or FMC) from adjudicating a private suit filed against a state. As with many other sovereign immunity cases of the previous six years, the issue split the Court 5-4.

50 What gave rise to the battle?

It all started with a gambling vessel (a private party) unsuccessfully quarreling with the State of South Carolina and then calling in a federal agency for support and relief. What follows is the tale of these three characters and the federalism issues their battle raised. Here is their story. The dispute began when South Carolina Maritime Services, Inc. ("Maritime Services") sought a berth at Charleston's Harbor for its chartered vessel the M/V TROPIC SEA. Maritime Services sought to offer gambling cruises to nowhere and to the Bahamas from the port of Charleston. Because the South Carolina State Ports Authority (SCSPA or "Ports Authority") has an established policy of denying berthing space to a vessel whose primary purpose is gambling, the SCSPA denied each of Maritime Services's five requests. The vessel remained anchored off of Charleston's Harbor for months.

Unhappy with the SCSPA's decision, Maritime Services filed a complaint with the Commission against the SCSPA, alleging violations of the Shipping Act of 1984, 46 U.S.C.A. app. §§ 1701-1719 (West 1975 & Supp. 2002) (hereinafter "Shipping Act" or "Act"). Specifically, Maritime Services alleged that the SCSPA violated the Act by unreasonably refusing to deal with and discriminating against its vessel. See id. §§ 1709(b)(10) & (d)(4). Maritime Services claimed that because the SCSPA allowed Carnival Cruise Lines's vessels to berth at Charleston's Harbor, it should have granted the same privilege to the M/V TROPIC SEA. Maritime Services sought injunctive relief and reparations against the SCSPA.

Because the SCSPA is decidedly an arm of the State of South Carolina, Ristow v. South Carolina Ports Authority, 58 F.3d 1051, 1053-55 (4th Cir. 1994), the suit was against the state. Thus, the SCSPA moved to dismiss the complaint, asserting, inter alia, its sovereign immunity as a defense. The administrative law judge (ALJ) agreed with the SCSPA and granted the motion; however, the Commission reversed the ALJ's decision. The SCSPA appealed to the Fourth Circuit, which reversed the Commission. S.C. State Ports Auth. v. Fed. Mar. Comm'n, 243 F.3d 165 (4th Cir. 2001). The Commission filed a petition for a writ of certiorari, which the U.S. Supreme Court granted on October 15, 2001. Fed. Mar. Comm'n v. S.C. State Ports Auth., 122 S. Ct. 392 (2001). The Court heard oral arguments in the case on February 25, 2002.

Who is the federal agency that sought to dismantle the armor of South Carolina's sovereign immunity?

The Commission, located in Washington, D.C., is charged with the responsibility of administering the Shipping Act. The Commission holds specified regulatory responsibilities over ocean shipping services in U.S. foreign commerce. The Shipping Act provides for two types of proceedings for alleged violations of the Act. First, the Act allows the Commission to conduct its own investigation and bring suit as it deems warranted under the circumstances. 46 U.S.C.A. app. § 1710(c). Second, the Act authorizes a private...