Legal Docket: You break it, you own it

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NICK EICHER, HOST: It’s The World and Everything in It for this ninth day of February, 2026. We’re so glad you’ve joined us. Good morning! I’m Nick Eicher.

MARY REICHARD, HOST: And I’m Mary Reichard. Time now for Legal Docket.

Before we get to today’s oral argument before the U.S. Supreme Court, I want to flag a few major cases coming later this term—cases touching some of the most contentious questions in American public life.

First, Trump v. Barbara, scheduled for argument in early April. This case asks whether President Trump’s executive order limiting birthright citizenship violates the Fourteenth Amendment.

That amendment grants citizenship to those born in the U.S. and “subject to the jurisdiction thereof.” The administration argues that clause was meant to guarantee citizenship to newly freed slaves—not to children of tourists or people in the country illegally.

EICHER: One point the administration is expected to press is the growing number of U.S.-born children who’ve spent their entire lives under China’s government—and then become eligible U.S. voters at age eighteen.

Another case involving migration is Noem v Al Otro Lado.

In this one, the Court will decide whether an asylum seeker must physically enter the U.S. in order to apply for asylum under federal law.

And one final case to highlight: Watson v Republican National Committee. That case asks whether federal law requires ballots to be received by Election Day to be counted—a question that matters a great deal because roughly thirty states currently allow ballots to arrive later.

REICHARD: Alright, now on to our sole U.S. Supreme Court argument for today. It’s actually two cases consolidated into one because they present the same legal question and very similar facts.

In 2017, lawyer Jeffrey Colt was walking in Midtown Manhattan to meet clients at a homeless shelter. As he crossed the street, a New Jersey Transit bus struck and seriously injured him.

A year later in Philadelphia, Cedric Galette was sitting in a stopped vehicle when a New Jersey Transit bus hit him, too—leaving him seriously injured.

EICHER: So, two accidents in two different states, but just a single defendant: New Jersey Transit.

Both men want to sue in the states where they got hurt—New York and Pennsylvania. But New Jersey Transit says no, they cannot do that.

The agency says it is protected by interstate sovereign immunity because it’s an arm of the State of New Jersey. In other words, it claims it cannot be sued in another state’s courts, even for injuries its buses allegedly caused outside New Jersey.

New Jersey Transit runs a network of train, bus, and light rail services across the state and into New York and Pennsylvania.

REICHARD: The Transit’s lawyer is New Jersey Solicitor General Michael Zuckerman. He wants the suit dismissed on immunity grounds.

ZUCKERMAN: Decades ago, New Jersey exercised its autonomy to provide what it saw as an essential public good: a statewide public transportation system. 

This case asks whether that system is most like a private business, locality, or state agency…. In short, NJ Transit looks nothing like a city or town, and little like a private company. It looks a lot like a New Jersey state agency. That means plaintiffs must sue it where the state has consented, in New Jersey.

But representing the injured men, lawyer Michael Kimberly argued that New Jersey Transit does not share the state’s sovereign immunity—because New Jersey chose to set the Transit up as a corporation.

KIMBERLY: When a state establishes a new public entity, it has a choice. First, it can establish a traditional department, agency, commission, bureau that is an entity of the government itself that uses state employees and state property to perform its functions and relies on the public fisc for its finances. 

Alternatively, it can establish a public corporation. A public corporation is a state created entity that bears two key features. First, it has a separate legal identity, and it’s thus capable of suing and being sued in court in its own name, in its own discretion. Second, it holds its own assets and liabilities, meaning that it’s responsible for paying debts, including adverse judgments, from its own resources.

That separation, he argued, is the entire point of making a corporation.

KIMBERLY: …it makes debt financing substantially easier, because separate legal entities are not bound by the constitutional limitations on public debt. That's so under New Jersey's debt limitation clause….. But by creating a separate legal entity in this way and achieving these benefits, the state accepts a cost….that it does not share in the state's sovereign immunity. That has been the consistent holding of this Court for the last 200 years.

EICHER: Zuckerman for New Jersey countered that a label like “corporation” does not override the reality of how tightly the Transit is bound up with the state.

ZUCKERMAN: The point is, when you look at NJ Transit, … how closely tied it is to New Jersey, and you analyze its features…the word ‘corporation’ didn’t, couldn’t have meant that kind of separation, because we’re giving it rule-making power. We’re having it sued in the appellate division the same way you sue every other agency that engages in rule-making. We have a statewide police department, all of these hallmarks of sovereignty. We have the governor able to veto every single thing it wants to do.

But several justices were not convinced. Justice Ketanji Brown Jackson:

JACKSON: Your argument sounds like you're saying: Don't worry about the fact that the state has chosen the corporate form for this entity, just look at what it does. And I guess, it seemed to me at least from what I've read and looked at, that the idea of the corporate form has to be given some meaning, and that traditionally, the idea was that when a state chooses to set it up as a corporation, it is actually instilling a corporate shield between itself and the corporation's actions and liabilities.

Zuckerman for the Transit pointed to a high court decision from nearly 100 years ago. That prompted this response from Justice Clarence Thomas:

THOMAS: The state creates a corporation, and historically they’ve created corporations in order to do things that the states either can’t or won’t do—to borrow money, to run banks, to run businesses, et cetera. So do you have anything that's recent, to which that applies?

Historically, corporations allowed states to take on operational risks without putting the state itself on the hook.

But the High Court agreed to hear the case because of a split among lower courts. And that inconsistency is exactly what Chief Justice John Roberts pointed to:

ROBERTS: But you disclaim liability for the debts and other exposure of --of the Transit Authority, right? So, if it's part—it’s kind of hard to say it's part of the state if you're not going to cover it when they get into trouble.

REICHARD: He hit on a vital point: that the doctrine of sovereign immunity turns in large part on whether a judgment would get paid out of the state treasury. New Jersey conceded its own statutes explicitly say its treasury is not liable for the Transit’s debts or judgments. New Jersey wants the advantage of sovereignty without the responsibility that comes with it—particularly responsibility for paying judgments.

JACKSON: ...New Jersey could have set this up as an agency and perhaps would’ve preserved the kind of arguments you’re talking about but, instead, it chose corporation.

In essence, the state’s choice has consequences.

Justice Neil Gorsuch pointed out another problem with New Jersey’s theory:

GORSUCH: The Eleventh Amendment of course prohibits an individual from suing another state. You didn't make the Eleventh Amendment argument that it deprives federal courts of jurisdiction over this case. Instead, you asserted sovereign immunity, assuming jurisdiction existed, and I'm just curious why?

ZUCKERMAN: Your Honor, I --I think -- uh, let, let me take that in a few parts, but I think, basically, to get to the nub of it...

GORSUCH: No, no. You get one part.

ZUCKERMAN: (laughs) yeah, I’ll try to do one part, then.

That exchange revealed how the court frowns on shifting legal theories, such as what New Jersey is doing here.

Still, I have no prediction how this one will go. But if New Jersey wins, then the Transit cannot be sued in neighboring states and that will force injured people to sue only in New Jersey courts, and set the same precedent nationwide.

And that’s this week’s Legal Docket!

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