Industrial Services Group, Inc. v. Josh Dobson

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PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 22-1465
INDUSTRIAL SERVICES GROUP, INC., d/b/a Universal Blastco,
Plaintiff - Appellee,
v.
JOSH DOBSON, in his official capacity as North Carolina Commissioner of Labor;
KEVIN BEAUREGARD, in his official capacity as Director of the Occupational Safety
and Health Division of the North Carolina Department of Labor,
Defendants - Appellants.
Appeal from the United States District Court for the Western District of North Carolina, at
Asheville. Martin K. Reidinger, Chief District Judge. (1:21-cv-00090-MR-WCM)
Argued: January 27, 2023 Decided: May 16, 2023
Before GREGORY, Chief Judge, WILKINSON, and HEYTENS, Circuit Judges.
Affirmed by published opinion. Chief Judge Gregory wrote the opinion, in which Judge
Wilkinson and Judge Heytens joined.
ARGUED: Stacey Alayne Phipps, NORTH CAROLINA DEPARTMENT OF JUSTICE,
Raleigh, North Carolina, for Appellants. Travis Wayne Vance, FISHER & PHILLIPS,
LLP, Charlotte, North Carolina, for Appellee. ON BRIEF: Joshua H. Stein, Attorney
General, Victoria L. Voight, Special Deputy Attorney General, NORTH CAROLINA
DEPARTMENT OF JUSTICE, Raleigh, North Carolina, for Appellants. David I. Klass,
FISHER & PHILLIPS LLP, Charlotte, North Carolina, for Appellee.
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GREGORY, Chief Judge:
The North Carolina Occupational Safety and Health Hazard Association (“NC
OSHA”) issued several itemized citations to Industrial Services Group (“ISG”) following
the on-site deaths of two ISG employees. Soon thereafter, ISG filed for declaratory and
injunctive relief against two North Carolina state officials, Josh Dobson, the North Carolina
Commissioner of Labor and acting Chief Administrative Officer for the North Carolina
Department of Labor (“NCDOL”), and Kevin Beauregard, the Director of NCDOL’s
Occupational Safety and Health Division, (collectively “Defendants”), in their official
capacities. ISG alleged that the issued citations were unlawful because they stemmed from
North Carolina’s occupational health and safety plan, which in their view violates 29
U.S.C. § 657(h) of the federal Occupational Safety and Health Act (“OSH Act”), a
provision that forbids Defendants from evaluating their employees’ enforcement activities
based on the number of penalties they have assessed and citations they have issued.
The district court denied Defendants’ motions to dismiss and for judgment on
pleadings, holding, inter alia, that they were not entitled to Eleventh Amendment sovereign
immunity because ISG’s claims satisfied the Ex Parte Young exception. Through this
interlocutory appeal, the parties ask us to grapple with that same issue. Defendants also
raise, for the first time, two arguments questioning ISG’s standing and insist that the
abstention doctrine bars federal courts from hearing ISG’s suit. For the reasons that follow,
we affirm the district court’s decision to deny Defendants Eleventh Amendment immunity
and decline to exercise pendent appellate jurisdiction over Defendants’ newly-raised claims.
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I.
A.
Enacted in 1970, the OSH Act establishes a comprehensive regulatory scheme
designed “to assure so far as possible . . . safe and healthful working conditions” for “every
working man and woman in the Nation.” 29 U.S.C. § 651(b). Along with the OSH Act,
Congress created the federal Occupational Safety and Health Administration (“OSHA”) to
ensure the OSH Act’s enforcement nationwide.
In addition to establishing federal regulations, the OSH Act “encourag[es] the States
to assume the fullest responsibility for the administration and enforcement of their
occupational safety and health laws,” 29 U.S.C. § 651(b)(11), and to “provide[] for the
development and enforcement of safety and health standards relating to one or more safety
or health issues” covered by the Act. 29 U.S.C. § 667(c)(2). To assume this responsibility,
the State must submit—and OSHA must approve—a “State Plan” which guarantees
standards “at least as effective in providing safe and healthful employment” as those
developed by the OSH Act. Id. A State Plan must also “provide a program for the
enforcement of the State standards which is, or will be, at least as effective as that provided
in the Act, and provide assurances that the State’s enforcement program will continue to
be at least as effective as the Federal program.” 29 C.F.R. § 1902.3(d)(1).
After OSHA approves a State Plan, it will “make a continuing evaluation of the
manner in which [the] State . . . is carrying out such plan.” 29 C.F.R. § 667(f). If OSHA
determines “that in the administration of the State plan there is a failure to comply
substantially with any provision of the State plan (or any assurance contained therein),” the
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Secretary of Labor will inform the State Agency of their withdrawal of approval, and once
notice of receipt is received, the State Plan will “cease to be in effect.” Id. And, as relevant
here, in 1998, Congress amended the OSH Act to forbid the Secretary from “us[ing] the
results of enforcement activities, such as the number of citations issued or penalties assessed,
to evaluate employees directly involved in enforcement activities under this chapter or to
impose quotas or goals with regard to the results of such activities.” 29 U.S.C. § 657(h).
With that background in mind, we turn to the facts before us.
B.
ISG—a South Carolina based corporation—is a heavy industry business, often
performing fabrication, installation, repairs, and inspections of industrial equipment on
behalf of its customers. The corporation, which operates under the trade name “Universal
Blastco,” frequently conducts its business outside the state, including in North Carolina,
where the events underlying this appeal transpired.
On September 21, 2020, two ISG employees were onsite at the Evergreen Packaging
Paper Mill in Canton, North Carolina conducting lamination-based work when a fire broke
out. Tragically, the two ISG employees lost their lives due to carbon monoxide poisoning
and blunt force trauma stemming from the fire. ISG properly reported the fatalities to the
NCDOL, which initiated an inspection of the worksite. Following their inspection, on
March 16, 2021, NCDOL’s Occupational Safety and Health Division issued ISG three
citations with thirteen overall violations: one “Willful Serious” violation, nine “Serious”
violations, and three “Non-Serious” violations resulting in total penalties of $112,000.
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Shortly thereafter, ISG filed a complaint in the United States District Court for the Western
District of North Carolina against Dobson and Beauregard in their official capacities.
ISG’s Complaint raised three primary claims. Counts One and Two, brought under
28 U.S.C. §§ 2201 and 2202, contended that Dobson and Beauregard could not lawfully
issue these citations because they maintain a practice of employee performance evaluation
in violation of § 657(h). Specifically, the Complaint asserted that Dobson, who plays a
role in administering the North Carolina State Plan (“NC State Plan”) 1 as the
Commissioner of Labor, “has admitted that the performance of ‘compliance officers’—
who inspect workplaces for hazardous conditions and issue citations for alleged
violations—is evaluated based on . . . ‘the number of inspections opened and closed, and
the number of citations issued and upheld.’” J.A. 8. Given the Commissioner’s admission,
the Complaint alleged that the NC State Plan “directly violates” § 657(h) and therefore “is
preempted by” the federal OSH Act. Id.; J.A. 11.
ISG’s third claim, raised under 42 U.S.C. § 1983, asserted that Defendants had
violated their due process rights by “engaging in enforcement activities against ISG despite
lacking the proper legal authority to do so” and “incentivizing their compliance officers to
commence investigation and enforcement activities and issue citations and penalties
against ISG pursuant to an official policy or practice that violates and is preempted by
1
The NC State Plan received initial approval in 1973 and final approval in 1996; it
“covers all private-sector employers and employees, with several notable exceptions, as
well as State and local government employers and employees, within the State.” See
www.osha.gov/laws-regs/regulations/standardnumber/1952/1952.5 (last visited May 5,
2023); J.A. 10. The NC State Plan is administered by the NCDOL and the NC OSHA.
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federal law.” J.A. 26. For these reasons, ISG argued, Defendants cannot lawfully issue
citations pursuant to their illegal operation of the NC State Plan nor enforce a policy
preempted by federal law. ISG seeks, inter alia, six forms of declaratory relief and two
requests for injunctive relief. 2
2
Specifically, ISG’s Complaint states the following prayers for declaratory and
injunctive relief:
(a) A declaration that Defendants’ official policy or practice of evaluating
compliance officers’ performance based on the number of citations issued or
penalties assessed violates the OSH Act;
(b) A declaration that the official policy or practice described in subsection
(a) has placed Defendants’ administration of the North Carolina State Plan
out of compliance with the OSH Act;
(c) A declaration that the official policy or practice described in subsection
(a) has placed Defendants’ administration of the North Carolina State Plan
out of compliance with the stated terms of the Plan itself;
(d) A declaration that the official policy or practice described in subsection
(a) is preempted by the OSH Act;
(e) A declaration that by maintaining the official policy or practice described
in subsection (a), Defendants have violated ISG’s substantive due process
rights under the Fourteenth Amendment;
(f) A declaration that by maintaining the official policy or practice described
in subsection (a), Defendants have violated ISG’s procedural due process
rights under the Fourteenth Amendment;
(g) A preliminary and permanent injunction prohibiting Defendants, their
officers, agents, servants, employees, and attorneys, and those persons in
active concert or participation with them who receive actual notice of the
injunction from engaging in enforcement activities against ISG, including
initiating or maintaining administrative proceedings;
(h) A preliminary and permanent injunction prohibiting Defendants, their
officers, agents, servants, employees, and attorneys, and those persons in
active concert or participation with them who receive actual notice of the
injunction from engaging in enforcement activities against any employer that
has been inspected or issued citations under the official policy or practice
described in subsection (a), including issuing citations, prosecuting existing
citations, or initiating or maintaining administrative proceedings.
J.A. 27.
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Defendants moved to dismiss and for judgment on the pleadings. Relevant to this
appeal, they asserted that ISG’s suit is barred because ISG’s claims in effect seek suit
against the state agency, which is protected by Eleventh Amendment immunity. On
January 7, 2022, a magistrate judge issued a Report & Recommendation (“R&R”) that
recommended denying both motions. In relevant part, the magistrate rejected Defendants’
Eleventh Amendment argument because it determined that ISG’s suit fell squarely within
the parameters of the Ex Parte Young exception.
In parallel proceedings, ISG pursued dismissal or stay of the issued citations with the
North Carolina Occupational Safety and Health Review Commission (“NC OSHRC”) on
August 13, 2021, arguing that Dobson lacked “the legal authority to institute and prosecute
this administrative action.” J.A. 700. In denying ISG’s motions, the NC OSHRC Hearing
Examiner concluded that § 657(h) is not an OSH Act standard that states are required to
enforce and, further, that there is no statutory or regulatory support for treating the provision
as a requirement under the State Plan. The Hearing Examiner also upheld several itemized
citations and dismissed one. Finally, the decision left open the opportunity for either party
to “raise the issue of staying these proceedings again, should a decision issue from the federal
court which suggests that further consideration is appropriate.” J.A. 710.
After the parties filed timely objections and responses, the district court accepted
the magistrate’s R&R, affirming denial of the motions. From that decision, Defendants
filed this interlocutory appeal. See Litman v. George Mason Univ., 186 F.3d 544, 548 (4th
Cir. 1999) (demonstrating this Court’s authority to hear, on interlocutory appeal, a district
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court’s order denying Eleventh Amendment immunity). Thus, we have jurisdiction to hear
Defendants’ interlocutory appeal.
II.
We review the grant or denial of a motion to dismiss de novo. See Benjamin v.
Sparks, 986 F.3d 332, 351 (4th Cir. 2021). That includes “a district court’s legal
determination of whether Ex Parte Young relief is available,” which is an “immediately
appealable” issue. Franks v. Ross, 313 F.3d 184, 192–93 (4th Cir. 2002); Antrican v.
Odom, 290 F.3d 178, 184 (4th Cir. 2002). We similarly review motions for Rule 12(c)
judgment on the pleadings de novo. Walker v. Kelly, 589 F.3d 127, 139 (4th Cir. 2009).
III.
Defendants challenge the district court’s conclusion that ISG’s suit satisfies the
parameters of the Ex Parte Young exception, which denies Defendants Eleventh
Amendment immunity protection and allows ISG’s claims to proceed. Defendants also
argue—for the first time on appeal—that: (1) ISG lacks Article III standing and (2) the
abstention doctrine (without indicating which specific abstention doctrine) bars federal
courts from hearing this case because it is also being actively litigated in state proceedings.
In response, ISG argues that Defendants have implicitly requested this court’s discretion
to exercise pendent appellate jurisdiction over their newly raised issues. ISG urges us to
decline that invitation and to affirm the district court’s decision denying Eleventh
Amendment immunity.
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We agree with ISG on both scores. Taking each argument in turn, we first address
Defendants’ Ex Parte Young argument and hold that the district court correctly denied them
Eleventh Amendment immunity. We then explain why we decline to exercise pendent
appellate jurisdiction over Defendants’ standing and abstention arguments.
A.
Turning to the most fundamental issue, we consider whether ISG’s suit falls within
the Ex Parte Young exception, thereby placing Defendants beyond the Eleventh
Amendment’s ambit.
1.
The Eleventh Amendment prohibits “any suit in law or equity, commenced or
prosecuted against one of the United States by Citizens of another State, or by Citizens or
Subjects of any Foreign State.” U.S. Const. amend. XI. This immunity “has been judicially
interpreted to run as well to actions by a state’s own citizens, by [Native American] tribes,
and . . . by foreign states.” Republic of Paraguay v. Allen, 134 F.3d 622, 627 (4th Cir.
1998) (internal citations omitted). It not only precludes suits against states as named parties
but also against state agents or officials “that are in fact actions against the state as the real
party in interest.” Id.In Ex Parte Young, the Supreme Court devised an exception to Eleventh Amendment
immunity for suits brought against state officials. See id.; Ex Parte Young, 209 U.S. 123, 160
(1908). State officers or agents acting in violation of the Constitution are “stripped of [their]
official or representative character and [are] subjected in [their] person to the consequences
of [their] individual conduct.” Id. Thus, this exception “allows private citizens, in proper
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cases, to petition a federal court to enjoin State officials in their official capacities from
engaging in future conduct that would violate the Constitution or a federal statute.” Antrican,
290 F.3d at 184. To satisfy this exception, “a court need only conduct a straightforward
inquiry into whether the complaint alleges an ongoing violation of federal law and seeks relief
properly characterized as prospective.” Verizon Md. Inc. v. Pub. Serv. Comm’n, 535 U.S.
635, 645 (2002) (cleaned up); see also Allen, 134 F.3d at 627. Taking ISG’s Complaint at
face value, we find that this suit falls well within Ex Parte Young’s bounds.
2.
As stated, the magistrate judge briefly determined that because ISG sued Defendants
in their official capacity and the declaratory and injunctive relief sought was prospective,
“as to future actions NC OSHA may take against” the company, the suit appropriately met
the Ex Parte Young exception, and Defendants were not entitled to Eleventh Amendment
immunity. J.A. 728. On appeal, Defendants contend that the district court erred in failing
to dismiss on Eleventh Amendment immunity grounds because NCDOL, and therefore the
state of North Carolina (rather than the named Defendants) is the “real, substantial party in
interest,” Ford Motor Co., 323 U.S. at 464; and ISG’s requested relief is retrospective in
nature. 3 Upon review, we reject these arguments.
At the outset, ISG’s Complaint properly alleges that Defendants’ supposed violation
of the federal OSH Act is “ongoing” or “continuing.” Our Ex Parte Young inquiry “does
3
Defendants also assert, and ISG does not deny, that NCDOL (and therefore North
Carolina) did not waive its Eleventh Amendment immunity. And there is no indication in
the record that North Carolina and NCDOL have waived sovereign immunity.
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not include an analysis of the merits of the claim.” Verizon, 535 U.S. at 646. Instead,
“[t]he requirement that the violation of federal law be ongoing is satisfied when a state
officer’s enforcement of an allegedly unconstitutional state law is threatened, even if the
threat is not yet imminent.” McBurney v. Cuccinelli, 616 F.3d 393, 399 (4th Cir. 2010)
(quoting Waste Mgmt. Holdings, Inc. v. Gilmore, 252 F.3d 316, 330 (4th Cir. 2001)).
Stated differently, to qualify for the exception, ISG need not prove that Defendants’ alleged
employee evaluation actions are an ongoing or continuing violation of the federal OSH
Act. Rather, it is sufficient that ISG’s Complaint merely alleges the ongoing behavior. See
Verizon, 535 U.S. at 645–46.
That is precisely what the Complaint achieves. ISG’s claims focus on the NC State
Plan’s past and continuing violation of § 657(h), which prohibits consideration of the
number of citations issued or penalties assessed, as well as the implementation of quotas
or goals with regard to such, in the course of employment evaluations. ISG’s Complaint
also alleges Dobson’s repeated admissions that NC OSHA’s compliance officers’
performance is based, in part, on the number of citations they issue. See, e.g., J.A. 12
(“[A]dmitted, in that the number of citations issued are one of a number of factors
considered when reviewing compliance officer performance.”); J.A. 15 (“Complainant
does admit that inspectors are reviewed as required by law annually which consider the
performance of the inspector including . . . the number of inspections opened and closed,
the number of citations issued and upheld.”). Therefore, we conclude that ISG properly
alleges an ongoing or continuing violation of federal law.
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3.
Moreover, the relief ISG requests is prospective in nature. Without explanation,
Defendants urge us to view ISG’s prayers for relief as a wolf in sheep’s clothing: an
attempt to attain “retrospective relief in the form of rescission of its citations.” Opening
Br. at 22. We do not accept this notion.
ISG’s two injunctive requests are quintessential examples of prospective injunctive
relief not barred by Eleventh Amendment immunity. See Ex Parte Young, 209 U.S. at
159–60. Their injunctive claims ask to prohibit Defendants “from engaging in enforcement
activities against ISG, including initiating or maintaining administrative proceedings” and
“from engaging in enforcement activities against any employer that has been inspected or
issued citations under the official policy or practice . . . including issuing citations,
prosecuting existing citations, or initiating or maintaining administrative proceedings.”
J.A. 27–28. To the extent that portions of the requested injunctive relief have
“retrospective” characteristics, that concern is easily addressed by our precedent.
Specifically, we look to CSX Transp., Inc. v. Bd. of Public Works of State of West
Virginia, 138 F.3d 537 (4th Cir. 1998) for guidance. There, the district court concluded
that an injunction against future tax collection from West Virginia’s Board of Public Works
(“Board”) requested retrospective relief, and was therefore “improper under Ex parte
Young, once the amount of the taxes had been assessed.” Id. at 540. The district court
reasoned that the plaintiffs’ requested injunction would “hold invalid and change the past
assessment,” making it a retrospective order due to the fact that the amount to be collected
had already been decided. Id. at 541 (cleaned up). On appeal, however, we rejected the
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district court’s conclusion because it would foreclose any injunction “pursuant to Ex parte
Young if the action to be enjoined had already been decided upon by a state official.” Id.
at 542. Because plaintiffs in those circumstances “have no way to know that they must sue
to enjoin an official’s action until after the official has decided to take that action,” we held
that “[a]n injunction against the future collection of the illegal taxes, even those that already
have been assessed, is prospective, and therefore available under the Ex parte Young
doctrine.” Id. at 541–42.
This case is on all fours with CSX. ISG’s Complaint indicates that Defendants have
issued multiple citations against the company following the on-site death of two of their
employees. We do not take the tragic facts underlying these citations lightly. However,
our review finds that, like the plaintiff in CSX, ISG seeks relief that would prohibit
Defendants from any additional or future allegedly unlawful actions. That is, ISG’s
Complaint does not seek to expunge their past citations, 4 but rather to preclude Defendants
from continuing their alleged illegal policies or practices (which ISG likely could not have
discovered until after the citations were issued) that they believe are in violation of the
federal OSH Act. See Coakley v. Welch, 877 F.3d 304, 305 (4th Cir. 1989) (affirming
district court’s decision denying state official Eleventh Amendment immunity where
plaintiff alleged state official had violated their due process rights and sought injunctive
relief ordering reinstatement to their job, based on conclusion that termination was an
ongoing harm preventing the plaintiff from obtaining the benefits of employment). Even
4
This course of relief, however, is actively being pursued in state proceedings. See
supra note 3.
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assuming that ISG’s requested relief relies on Defendants’ previous allegedly unlawful
actions, the true “essence,” see Allen, 134 F.3d at 628, of the relief is prospective.
In sum, ISG’s prayers for relief are not retrospective, as Defendants claim, but
properly prospective, and satisfy the second piece to the Ex Parte Young exception.
4.
Finally, Defendants insist that NCDOL, and therefore the state of North Carolina,
is the true party in interest. Not so.
Courts find that “the state is the real, substantial party in interest” when the “relief
sought nominally against an officer is in fact against the sovereign if the decree would
operate against the latter.” Pennhurst State Sch. & Hosp. v. Halderman, 465 U.S. 89, 101
(1984) (quoting Hawaii v. Gordon, 373 U.S. 57, 58 (1963)). Here, ISG’s Complaint alleges
that the NC State Plan has and continues to violate the OSH Act. It also claims that Dobson
and Beauregard, who in their official capacities are responsible for overseeing NCDOL’s
implementation of the NC State Plan and its conformity with federal law, are accountable
for the unlawful employee evaluation practices. Relying on that, the Complaint does not
seek action by North Carolina, but rather, by the named Defendants who are at the helm of
the NC State Plan’s operation. Thus, Dobson and Beauregard were properly named as such
in this suit. See D.T.M. ex rel. McCartney v. Cansler, 382 F. App’x. 334, 338 (4th Cir.
2010) (concluding that Secretary of North Carolina’s Medicaid program was not entitled
to Eleventh Amendment immunity because he, in his official capacity, was the “person
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responsible for assuring that the agency’s decision compl[ies] with federal law”)
(unpublished). 5
B.
Given that Defendants are not entitled to Eleventh Amendment Immunity, we now
address whether we should exercise pendent appellate jurisdiction over Defendants’
freshly-raised standing and abstention claims. We decline to do so.
1.
Our “appellate jurisdiction is limited to final orders from the district courts.” Rux
v. Republic of Sudan, 461 F.3d 461, 474 (4th Cir. 2006). Importantly, however, the
collateral order doctrine creates an exception to that rule for claims involving Eleventh
Amendment immunity. See P.R. Aqueduct & Sewer Auth. v. Metcalf & Eddy, Inc., 506
U.S. 139, 144 (1993). On the other hand, the collateral order doctrine does not provide us
with appellate jurisdiction over Defendants’ standing and abstention claims. Therefore,
we must determine whether we have “pendent appellate jurisdiction, a judicially-created,
discretionary exception to the final judgment requirement,” over those new arguments.
Rux, 461 F.3d at 475.
Intended to be “of limited and narrow application driven by considerations of need,
rather than of efficiency,” this exception allows appellate courts to review issues that are
not otherwise subject to immediate appeal when such issues “are so interconnected with
5
Defendants briefly cite to our recent holding in Cunningham v. Lester, 990 F.3d
361 (4th Cir. 2021), for further support. However, because Cunningham does not analyze
the Ex Parte Young exception—which is the integral issue before us today—it is
unnecessary to address here.
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immediately appealable issues that they warrant concurrent review.” Id. Pendent appellate
jurisdiction is exclusively available “(1) when an issue is ‘inextricably intertwined’ with a
question that is the proper subject of an immediate appeal; or (2) when review of a
jurisdictionally insufficient issue is ‘necessary to ensure meaningful review’ of an
immediately appealable issue.” Id. at 475 (quoting Swint v. Chambers Cnty. Comm’n, 514
U.S. 35 50–51 (1995)).
“Two separate rulings are ‘inextricably intertwined’ if ‘the same specific question
will underlie both the appealable and the non-appealable order, such that resolution of the
question will necessarily resolve the appeals from both orders at once.’” Scott v. Fam.
Dollar Stores, Inc., 733 F.3d 105, 111 (4th Cir. 2013) (quoting Ealy v. Pinkerton Gov.
Servs., Inc., 514 F. App’x 299, 309 (4th Cir. 2013) (per curiam, unpublished)). Moreover,
“review of a pendent issue will be necessary to ensure meaningful review of an
immediately appealable issue if resolution of the pendent issue is necessary, or essential in
resolving the immediately appealable issue.” Ealy, 514 F. App’x at 309 (internal
quotations omitted).
Because a district court’s denial of a motion to dismiss on Eleventh Amendment
immunity grounds is immediately appealable, see Metcalf & Eddy, 506 U.S. at 147, our
consideration of Defendants’ standing and abstention arguments thus hinges on whether
those issues are “inextricably intertwined” with or “necessary to ensure meaningful review
of” the Eleventh Amendment immunity claim. See Rux, 461 F.3d at 476. Because we find
that they are not, we cannot exercise pendent appellate jurisdiction over those claims.
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2.
We begin with Defendants’ new standing claim. Standing is the “irreducible
constitutional minimum” required to make “Cases” or “Controversies” justiciable under
Article III, § 2 of the Constitution. Lujan v. Defenders of Wildlife, 504 U.S. 555, 560
(1992). It is axiomatic that standing is a threshold jurisdictional issue that must be
determined before a court can consider the merits of a case. See Steel Co. v. Citizens for a
Better Env’t, 523 U.S. 83, 88 (1998). But while standing is a vital threshold issue, it is not
an essential prerequisite to determining the other jurisdictional, immediately appealable
claim in this case: Eleventh Amendment immunity.
The Supreme Court has long recognized that passage of the Eleventh Amendment
highlights “the fundamental principle of sovereign immunity [which] limits the grant of
judicial authority in Art. III.” Pennhurst, 465 U.S. at 97. Absent unequivocal expression of
consent from a state, this immunity bars citizens from bringing suits against it, id. at 99, and
also its officials if, upon further analysis, the suits truly seek to establish “the state as the real
party in interest,” Allen, 134 F.3d at 627. Thus, like standing, Eleventh Amendment
immunity presents a jurisdictional question that may bar a suit from advancing to the merits.
See Edelman v. Jordan, 415 U.S. 651, 678 (1974) (holding that “it has been well settled . . .
that the Eleventh Amendment defense sufficiently partakes of the nature of a jurisdictional
bar.”); Pearson v. Callahan, 555 U.S. 223, 231 (2009) (holding that Eleventh Amendment
immunity is “an immunity from suit rather than a mere defense to liability.”).
With that in mind, Defendants’ standing assertion is not so “inextricably
intertwined” with their Eleventh Amendment immunity claim because resolution of the
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former does not underlie or necessarily resolve the latter. The immediately appealable
Eleventh Amendment immunity issue asks us to determine whether this suit falls within
the parameters of the Ex Parte Young exception, thereby barring Defendants from
immunity. As discussed above, that analysis required our inquiry into the form of the relief
requested. That analysis in turn required us to determine whether the relief sought was
prospective or retrospective, as well as whether ISG sufficiently alleged that Defendants’
unlawful conduct was ongoing.
Defendants’ pendent standing argument, on the other hand, would require us to
undertake an entirely irrelevant inquiry. For instance, under the standing doctrine’s “injury
in fact” prong, this Court would examine whether ISG suffered a “concrete and
particularized” and “actual and imminent” injury, Lujan, 504 U.S. at 560, by Defendants.
This prong alone would require a fact-intensive analysis that bears on considerations not
relevant to the Eleventh Amendment immunity claim, such as whether the violations, fines,
and penalties Defendants issued to ISG caused the company harm. See Sierra Nat. Ins.
Holdings, Inc. v. Credit Lyonnais S.A., 64 F. App’x 6, 7 n.1 (9th Cir. 2003) (declining to
exercise pendent appellate jurisdiction, in part, over a “quite fact-dependent” standing issue
in an interlocutory appeal stemming from a district court’s denial of state immunity
protection) (unpublished). Where Defendants’ standing argument asks us to grapple with
such questions, the Eleventh Amendment immunity claim does not. See Moniz v. City of Fort
Lauderdale, 145 F.3d 1278, 1281 n.3 (11th Cir. 1998) (declining to exercise pendent appellate
jurisdiction over a newly raised standing claim on appeal because the Court could “resolve
the qualified immunity [immediately appealable] issue . . . without reaching the merits of
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appellants’ challenge to . . . standing.”). Thus, the standing argument does not rest on the
“same specific question” that “will necessarily resolve” or would be necessary to review the
Eleventh Amendment immunity issue. Ealy, 514 F. App’x at 309 (emphasis added).
For similar reasons, the standing analysis is not “necessary to ensure meaningful
review of” Defendants’ Eleventh Amendment claim. Id. While a standing analysis could
foreclose the need to address the immunity defense if ISG does indeed lack standing, that
is not the pendent jurisdiction test. We therefore hold that we do not have jurisdiction over
the pendent standing issue.
3.
We are, also, unpersuaded by Defendants’ pendent abstention argument. The
abstention doctrine articulated in Younger v. Harris, 401 U.S. 37 (1971), compels federal
courts to refrain from exercising jurisdiction over state proceedings if there is (1) “an
ongoing state judicial proceeding, instituted prior to any substantial progress in the federal
proceeding,” (2) that “implicates important, substantial, or vital state interests,” and (3)
“provides an adequate opportunity for the plaintiff to raise the federal constitutional claim
advanced in the federal lawsuit.” Laurel Sand & Gravel, Inc. v. Wilson, 519 F.3d 156, 165
(4th Cir. 2008). Specifically, Defendants insist that the district court must abstain from
hearing this case because it stems from the same set of circumstances and seeks some of
the same relief; and the state-court decision, which is being actively litigated, would
ultimately decide the validity of the citations issued.
We fail to see how the pendent abstention issue is “inextricably intertwined” with
the immediately appealable issue here. Defendants’ abstention claim asks us to consider
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whether the district court should refrain from hearing the case, given the ongoing nature of
the state proceedings and both cases’ foundation in the same set of facts. But answering
this question will have no bearing on how we resolve Defendants’ Eleventh Amendment
claim. In other words, this is not the same specific question as the underlying, appealable
immunity question discussed above. Nor is it necessary to review the doctrine of abstention
to resolve the immunity defense properly before this Court. Hence, we will not decide this
adjoining pendent issue. 6
****
Defendants’ standing and abstention arguments may be meritorious, but they are not
sufficiently related to the Eleventh Amendment claim before us. Accordingly, we are
without jurisdiction to review them.
IV.
For the preceding reasons, we decline to exercise pendent appellate jurisdiction over
Defendants’ standing and abstention arguments. We also agree with the district court and
conclude that Defendants are not protected by Eleventh Amendment immunity because
ISG’s suit fits squarely within the Ex Parte Young exception. Thus, ISG may proceed with
the merits of its claims below. We, therefore,
AFFIRM.
6
ISG also argues that Defendants’ standing and abstention arguments are not
properly before this Court as they were not raised below. However, because we have
determined that we cannot hear these claims based on our lack of pendent appellate
jurisdiction over them, we need not address this argument.
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