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Erik Johanson PLLC and White’s Place, LLC Challenge Jacksonville Aviation Authority’s Sovereign Immunity in Federal Lawsuit

By July 30, 2020June 23rd, 2022No Comments

On July 24, 2020, the United States Bankruptcy Court for the Middle District of Florida authorized Erik Johanson PLLC to represent White’s Place, LLC in a lawsuit challenging the sovereign immunity of the Jacksonville Aviation Authority. If successful, Erik Johanson PLLC and White’s Place, LLC could set precedent allowing private parties to sue the Jacksonville Aviation Authority for tortious conduct not based on an express written agreement. Such a ruling would be a significant blow to the Jacksonville Aviation Authority and other purported “state agencies and instrumentalities” that, while cloaked with bureaucratic authority, function largely independent of the state as for-profit private corporations.

On July 10, 2020, White’s Place, LLC filed a Motion for Partial Summary Judgment contending that the Jacksonville Aviation Authority does not qualify as a “state agency or instrumentality” under the Eleventh Circuit Court of Appeal’s three factor test set forth in Vierling v. Celebrity Cruises, Inc., 339 F.3d 1309, 1314 (11th Cir. 2003). In Vierling, the Eleventh Circuit held that whether an entity qualifies for sovereign immunity depends on “(1) how state law defines the entity; (2) what degree of control the state maintains over the entity; and (3) from where the entity derives its funds and who is responsible for satisfying the judgments against the entity.” Id. “Although no single factor is dispositive, the third factor, the source of the entity’s funds and responsibility for satisfying judgments, is of considerable importance.” Id. Where the purported state agency has an “anticipated and actual history of financial and operational independence,” such that it is, in essence, “financially self-sufficient,” the agency is not entitled to the protections of sovereign immunity. Id. at 1315.

In its Motion for Partial Summary Judgment, White’s Place, LLC argues that the Jacksonville Aviation Authority’s financial independence, which is evidenced by its more than $97 million in positive net working capital on hand effective December 31, 2019, negates any contention that the Jacksonville Aviation Authority is a “state agency or instrumentality” entitled to the protections of sovereign immunity. The United States Bankruptcy Court for the Middle District of Florida has set the Motion for Partial Summary Judgment for hearing on August 12, 2020. To defeat the Motion for Partial Summary Judgment, the Jacksonville Aviation Authority will have to cite to convince the Court that there is at least a genuine issue of material fact regarding whether it is a sovereign entitled to the protections of the Eleventh Amendment. Any factual issues that cannot be resolved in the context of White’s Place, LLC’s Motion for Partial Summary Judgment are scheduled to be tried by United States Bankruptcy Judge Catherine P. McEwen on September 1-3, 2020. For the reasons stated above, the results of the trial could have wide ranging implications for private parties and state agencies in the State of Florida and beyond.

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