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Abstract

In Franchise Tax Board v. Hyatt (Hyatt III), the Supreme Court overruled forty-year-old precedent that allowed a citizen to sue a state in another state’s courts.1 The Court’s 5-4 decision creates another barrier for plaintiffs who seek to hold states accountable. Hyatt III expands the doctrine of sovereign immunity to provide states additional protection against citizen suits. Yet the opinion dedicates a mere three paragraphs to discussion of stare decisis.2

The Court’s disregard for stare decisis and expansive view of sovereign immunity are problematic. For the first time, the Court concluded that states are immune from private suits in other states’ courts. But rather than address those aspects of the Court’s opinion, this Note will evaluate Hyatt III through the lens of the Full Faith and Credit Clause. In Nevada v. Hall and Hyatt’s first two trips to the Supreme Court, 3 the Court’s opinions were centered around the Full Faith and Credit Clause, but Hyatt III barely mentions the Clause. The Full Faith and Credit Clause is also central to Hyatt III because it governs when a state can constitutionally apply its own law to an interstate dispute. In Hyatt III, a Nevada citizen brought a tort action against a California agency in Nevada state court. Hyatt III involved conflicting state statutes: California law immunized the agency but Nevada law did not. Thus, the Nevada court had to decide which law to apply by using conflict of law principles. The Full Faith and Credit Clause provides a constitutional limit on the Nevada court’s determination. That is, the Supreme Court looks to the Full Faith and Credit Clause to determine whether the Nevada court acted constitutionally in applying its own law. By casting the Full Faith and Credit Clause aside, Hyatt III prevents a state from applying its own law to hold another state accountable for harm to its citizens.

In this Note, I suggest that the Court should have decided Hyatt III on the basis of the Full Faith and Credit Clause, rather than by expanding the doctrine of sovereign immunity. The Full Faith and Credit Clause limits when a state can constitutionally apply its own law in an interstate action if another state’s law conflicts. The Court’s established standard should not vary simply because another state is the defendant.

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