Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca2-14-03348/USCOURTS-ca2-14-03348-0/pdf.json

Nature of Suit Code: 440
Nature of Suit: Other Civil Rights
Cause of Action: 

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14‐3348

Am. Trucking Ass’ns v. N.Y. State Thruway Auth.

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

August Term, 2014

(Argued: June 17, 2015      Decided: August 4, 2015)

Docket No. 14‐3348

‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐x

AMERICAN TRUCKING ASSOCIATIONS,

INC., WADHAMS ENTERPRISES, INC.,

LIGHTNING EXPRESS DELIVERY

SERVICE INC., WARD TRANSPORT &

LOGISTICS CORP., on behalf of themselves

and all others similarly situated,

Plaintiffs‐Appellants,

‐v.‐

NEW YORK STATE THRUWAY

AUTHORITY, NEW YORK STATE

CANAL CORPORATION, THOMAS J.

MADISON, JR., in his official capacity as

Executive Director of the New York State

Thruway Authority, HOWARD MILSTEIN,

in his official capacity as Chair of the New

York State Thruway Authority/Canal

Corporation Boards of Directors, DONNA

J. LUH, in her official capacity as Vice‐

Chair of New York State Thruway

Case 14-3348, Document 76-1, 08/04/2015, 1568214, Page1 of 22
Authority/Canal Corporation Boards of

Directors, E. VIRGIL CONWAY, in their

official capacities as members of the New

York State Thruway Authority/Canal

Corporation Boards of Directors,

RICHARD N. SIMBERG, in their official

capacities as members of the New York

State Thruway Authority/Canal

Corporation Boards of Directors,

BRANDON R. SALL, in their official

capacities as members of the New York

State Thruway Authority/Canal

Corporation Boards of Directors, J. RICE

DONALD, JR., in their official capacities as

members of the New York State Thruway

Authority/Canal Corporation Boards of

Directors, JOSE HOLGUIN‐VERAS, in their

official capacities as members of the New

York State Thruway Authority/Canal

Corporation Boards of Directors,

Defendants‐Appellees.

‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐x

Before: NEWMAN, JACOBS, and CALABRESI, Circuit Judges.

Plaintiffs allege that the New York State Thruway Authority charges

excessive tolls in violation of the Commerce Clause of the United States

Constitution.  The district court (McMahon, J.) dismissed for failure to join a

necessary party (the State of New York).  We vacate the judgment of the district

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court and remand for further proceedings consistent with this opinion.  Judge

Newman concurs in a separate opinion.

RICHARD B. KATSKEE, Mayer Brown

LLP, Washington, District of Columbia

(Evan M. Tager, Thomas P. Wolf, Mayer

Brown LLP, Washington, District of

Columbia; Richard Pianka, ATA Litigation

Center, Arlington, Virginia, on the brief),

for Plaintiffs‐Appellants.

ANDREW W. AMEND, Assistant Solicitor

General (Barbara D. Underwood, Solicitor

General; Cecelia C. Chang, Special Counsel

to the Solicitor General; Philip V. Tisne,

Assistant Solicitor General; on the brief; for

Eric T. Schneiderman, Attorney General of

the State of New York), New York, New

York, for Defendants‐Appellees.

DENNIS JACOBS, Circuit Judge:

Three commercial trucking companies along with their national trade

association and a putative class of commercial truckers (“plaintiffs”) sue the New

York State Thruway Authority (the “Thruway Authority”) under 42 U.S.C.

§ 1983, alleging that the Thruway Authority charges excessive tolls in violation of

the Commerce Clause of the United States Constitution.  In particular, plaintiffs

allege that the Thruway Authority diverts excessive highway tolls to fund

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maintenance and improvements to the New York Canal System (the “Canal

System”)‐‐projects that are unrelated to maintaining the Thruway as a channel of

interstate commerce.  The district court (McMahon, J.) dismissed under Federal

Rule of Civil Procedure 12(b)(7) for failure to join the State of New York as a

necessary party under Rule 19.  We conclude that the ruling was an abuse of

discretion, and therefore vacate the judgment and remand for further

proceedings consistent with this opinion.

BACKGROUND

The district court dismissed under Federal Rule of Civil Procedure 12(b)(7).

Accordingly, the following facts drawn from plaintiffs’ complaint are presumed

true, and are presented in the light most favorable to plaintiffs.  See, e.g.,

Clarendon, Ltd. v. Bank of Saurashtra, 77 F.3d 631, 633 (2d Cir. 1996).  Most facts

are undisputed.

The Governor Thomas E. Dewey Thruway system (the “Thruway”) is New

York’s piece of the National Interstate Highway System; stretching 570 miles

across the State of New York, it includes portions of I‐87, I‐90, I‐95, I‐190, and

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I‐287.  As a major artery of interstate commerce in the Northeast, it is a critical

route for commercial truckers serving the region.

The Thruway is operated and managed by the New York State Thruway

Authority, an “autonomous public‐benefit corporation” created by a statutory

charter from the State of New York.  Compl. ¶ 17.  Its statutory mandate is “to

finance, construct, reconstruct, improve, develop, maintain, or operate” the

Thruway.  N.Y. Pub. Auth. Law § 353.  Its organic statute authorizes the Thruway

Authority to “sue and be sued,” to “make contracts,” and to “borrow money and

issue negotiable notes.”  Id. § 354(1), (7), (12).

The Thruway Authority is not an “arm of the state” and therefore does not

enjoy New York’s Eleventh Amendment state sovereign immunity.  Mancuso v.

N.Y. State Thruway Auth., 86 F.3d 289, 296 (2d Cir. 1996) (“We are unable to

conclude that subjecting the Thruway Authority to suit in federal court would be

an affront to the dignity of New York.”).  As we explained in Mancuso,

[t]he Thruway Authority . . . is not a traditional state agency, but a

public entity that is generally self‐funded and, except for the

appointment of its members to nine‐year terms, it is not under

significant state control.  Although the Thruway Authority may be

identified closely with the state, New York State has given the

Thruway Authority an existence quite independent from the state

and exercises the most minimal control over the Thruway Authority.

Id. at 296.

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“No provision of New York law requires the state to fund the Thruway

Authority’s operations,” id. at 295, the state is not liable for its debts, id. at 296;

and it receives no state tax dollars and only de minimis federal funds.  Instead,

the Thruway Authority relies almost entirely on tolls.  It is a “strictly . . .

user‐supported system,” Compl. ¶ 47, that is “structured . . . to be

self‐sustaining.”  Mancuso, 86 F.3d at 296 (internal quotation marks omitted).

With the ascendancy of the Thruway and other modern channels of

interstate commerce, the New York Canal System has faded into obsolescence.

The Canal System‐‐“a network of waterways that stretches across upstate New

York,” including the Erie, Oswego, Champlain, Cayuga, and Seneca Canals‐‐

“[o]nce a vital link between the markets of the East Coast and suppliers in the

Midwest, . . . is now primarily a recreational space for tourists.”  Compl. ¶ 2.

Since the completion of the Erie Canal in the early 1800s, the New York

constitution has included explicit textual protections for the Canal System, and

entrusted its management and care to the State.  The wording has shifted over the

years, but there has always been a constitutional commitment by the State of

New York to care for the Canal System.  The current provision is as follows:

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The legislature shall not sell, abandon or otherwise dispose of the

now existing or future improved barge canal, the divisions of which

are the Erie canal, the Oswego canal, the Champlain canal, and the

Cayuga and Seneca canals, or of the terminals constructed as part of

the barge canal system; . . . such canals and terminals shall remain

the property of the state and under its management and control

forever.

N.Y. Const. art. XV, § 1.

The New York constitution also obligates the legislature to support the

canals financially, to some degree:  “The legislature shall annually make

provision for the expenses of the superintendence and repairs of the canals, and

may provide for the improvement of the canals in such manner as shall be

provided by law.”  Id. § 3.

Historically, the Canal System was supported through the normal

appropriations process and was managed by the New York Department of

Transportation.  In 1992, the legislature transferred responsibility for

management of the Canal System from the New York Department of

Transportation to the Thruway Authority.  See N.Y. Canal Law § 5.  The 1992

legislation created a subsidiary corporation of the Thruway Authority, called the

New York Canal Corporation (the “Canal Corporation”), “which shall be deemed

to be the state for the purposes of such management and control of the canals but

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for no other purposes.”  Id. § 6(1).  Finally, to respect the constitutional mandate

that the State own and operate the canal system “forever,” the 1992 legislation

confirmed that the “canal system shall remain the property of the state and under

its management and control as exercised by and through” the Thruway

Authority and the Canal Corporation.  Id.

Now that the Canal System is operated by the Canal Corporation as a

subsidiary of the Thruway Authority, the considerable cost of maintaining (and

sometimes upgrading, developing, and expanding) the Canal System is funded

almost entirely through the collection of highway tolls.  No appropriations from

New York’s general fund have been needed for many years.  When the Canal

System needs more funding, the Thruway Authority raises tolls.  Approximately

ten to twelve percent of Thruway tolls are diverted to canal‐related development

projects: about 80 to 100 million dollars annually.

Plaintiffs, who pay tolls on the Thruway daily, filed this lawsuit in

November 2010.  Primarily, plaintiffs allege that the Thruway Authority is

unduly burdening interstate commerce by collecting excessive tolls to fund

canal‐related development projects upstate, rather than to maintain the Thruway

as a channel of interstate commerce.

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Plaintiffs did not name the State of New York as a defendant, and the State

has not sought to intervene.  The Thruway Authority‐‐through its counsel, the

Attorney General for the State of New York‐‐moved to dismiss under Federal

Rule of Civil Procedure 12(b)(7) for failure to join a necessary party under Rule

19.  (Because of the Eleventh Amendment, the State cannot be joined without its

consent.)

The district court granted the motion and dismissed without prejudice.

First, the court noted its disagreement with our precedent in Mancuso, which

forecloses Eleventh Amendment sovereign immunity for the Thruway Authority.

See Am. Trucking Ass’ns, Inc. v. N.Y. State Thruway Auth., No. 13 Civ. 8123,

2014 WL 4229982, at *5 (S.D.N.Y. Aug. 6, 2014) (“Were I writing on a blank slate, I

would conclude that the Thruway Authority was in fact cloaked with sovereign

immunity . . . [a]nd I would dismiss this lawsuit on that ground.”).  Then, after

acknowledging that Mancuso is the law of this Circuit, the district court turned to

Rule 19 to “recognize constitutional reality in a different way,” by holding that

the State was both a necessary and an indispensable party.  American Trucking,

2014 WL 4229982, at *6.

Plaintiffs appeal.

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DISCUSSION

This Court reviews dismissal of a complaint under Rule 12(b)(7)‐‐that is,

“for failure to join a party under Rule 19”‐‐only for abuse of discretion.  Johnson

v. Smithsonian Inst., 189 F.3d 180, 188 (2d Cir. 1999).  Questions of law that

inform a district court’s Rule 19 determination are reviewed de novo.  Seneca

Nation of Indians v. New York, 383 F.3d 45, 47 (2d Cir. 2004) (per curiam).  An

exercise of discretion that rests on an error of law is necessarily an abuse of

discretion.  Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 405 (1990).

I

“In determining whether an action should be dismissed for nonjoinder, the

court . . . must initially determine whether the party should be joined as a

‘necessary party’ under Rule 19(a).”  ConnTech Dev. Co. v. Univ. of Conn. Educ.

Props., Inc., 102 F.3d 677, 681 (2d Cir. 1996).  As relevant here, an absent person

may be “necessary” under Rule 19(a) if “that person claims an interest relating to

the subject of the action and is so situated that disposing of the action in the

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person’s absence may[,] . . . as a practical matter[,] impair or impede the person’s

ability to protect the interest.”  Fed. R. Civ. P. 19(a)(1)(B).1

If joinder of a “necessary” party under Rule 19(a) is not feasible, the court

consults Rule 19(b), which “requires courts to consider whether, ‘in equity and

good conscience,’ the party is one without whom the action between the

remaining parties cannot proceed‐‐or, in the traditional terminology, whether the

absent party is ‘indispensable.’”  Marvel Characters, Inc. v. Kirby, 726 F.3d 119,

132 (2d Cir. 2013) (quoting Fed. R. Civ. P. 19(b)).  “Federal courts are extremely

reluctant to grant motions to dismiss based on nonjoinder and, in general,

dismissal will be ordered only when the defect cannot be cured and serious

prejudice or inefficiency will result.”  7 Charles Alan Wright & Arthur R. Miller,

Fed. Practice & Procedure § 1609 (3d ed. 2015).

     1 An absent person may also be “necessary” under Rule 19(a) if “the court

cannot accord complete relief among existing parties” without the absent person,

or if a person’s absence subjects an existing party to a “substantial risk of

incurring double, multiple, or otherwise inconsistent obligations.”  Fed. R. Civ. P.

19(a)(1).  None of those provisions of Rule 19(a) is at issue in this case.

11

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II

A

The Thruway Authority argues that three distinct state “interests” are

threatened if this lawsuit proceeds in the absence of the State of New York.  None

of them is protected by Rule 19(a).

1.  New York owns the Canal System, and the New York constitution

provides that the State “shall not sell, abandon or otherwise dispose of” it.  N.Y.

Const. art. XV, § 1.  That prohibition lasts “forever.”  Id.  Relying on this

language, the Thruway Authority has suggested that the State’s real property

interest in the Canal System, and its corresponding obligation not to “abandon”

it, are threatened by this litigation, and, thus, that this real property interest

makes the State a necessary party.

To the extent this argument is still being advanced on appeal, we reject it.

No judgment in this case would require New York to “sell, abandon or otherwise

dispose of” the Canal System.  As context and common usage make clear, to

“sell” and to “abandon” property are two ways to “dispose of” it.  See United

States v. Cowan, 396 F.2d 83, 87 (2d Cir. 1968) (“The abandonment of property is

12

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the relinquishing of all title, possession, or claim to or of it‐‐a virtual intentional

throwing away of it.”).  Since this lawsuit challenges only the collection of

excessive Thruway tolls to fund unrelated projects, title to real property owned

by an absent party is not at issue, and cannot serve as a valid interest under Rule

19(a).2

The district court focused on the State’s supposed obligation “to fund the

[canal] system so as to avoid ‘abandoning’ it.”  American Trucking, 2014 WL

4229982, at *5.  Even ignoring that the word “abandon” is a real property term of

art, and accepting the linguistic premise that insufficient funding can lead to

abandonment, this lawsuit is no threat to that constitutional obligation, which the

State can fulfill using its own funding sources.

2.  The Thruway Authority contends that the State has a financial interest

in the outcome of this litigation because, if the practice of diverting toll revenue

to support the Canal System is held unconstitutional, the State will have to come

up with another way to raise these funds.  The State’s interest in having another

     2 That distinguishes one of the authorities heavily relied upon by the

Thruway, Seneca Nation of Indians v. New York, which stands for the

unsurprising proposition that an absent sovereign may be a necessary party to a

lawsuit that calls into question a real property interest of the sovereign.  383 F.3d

45 (2d Cir. 2004) (per curiam).

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entity fulfill its constitutional obligation to support the Canal System is assuredly

significant, but it is too remote and indirect to make it a necessary party.

An adverse judgment in this case would run only against the Thruway

Authority, and “the state is not legally obligated to pay for the Thruway

Authority’s debts.”  Mancuso, 86 F.3d at 296.  True, any adverse judgment would

prohibit the diversion of excess tolls to support projects that are unrelated to the

Thruway’s role as a channel of interstate commerce.  See generally Bridgeport &

Port Jefferson Steamboat Co. v. Bridgeport Port Auth., 567 F.3d 79, 86‐88 (2d Cir.

2009).  But that the allegedly excessive tolls are diverted to support canals is

beside the point‐‐it is the tolls that are alleged to be unconstitutional.  Plaintiffs’

constitutional claims would be identical if the Thruway Authority charged

excessive tolls to underwrite the State’s interest in a new baseball stadium, or

agricultural research, or repertory theatre.  The State may deem such

expenditures essential or not, and may fund them or not; and may well prefer

that the funding come from elsewhere.  In the same way, if the Thruway

Authority loses, the State will likely have to come up with some other way to

raise money for the canals.

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This theory of the State’s Rule 19 interest, premised on a lost stream of

money, is inconsistent with Circuit precedent.  In ConnTech Development Co. v.

University of Connecticut Education Properties, Inc., 102 F.3d 677 (2d Cir. 1996),

we considered a Rule 19 interest asserted on behalf of the State of Connecticut, by

a corporate entity (named “UCEPI”) that was “incorporated by the Connecticut

legislature for the purpose of overseeing the construction” of a state‐owned park

on the campus of the University of Connecticut.  Id. at 679.  The relevant contract,

however, confirmed that UCEPI was legally distinct from the State, and that the

State was not liable for UCEPI’s debts.  Id. at 682‐83.  When UCEPI was sued for

breach of contract by a construction sub‐contractor, it moved to dismiss for

failure to join a necessary party who could not be joined: the State of Connecticut,

which owned the property, funded the construction project, and had “created

[UCEPI] solely to develop this project.”  Id. at 682 n.2.  This Court rejected

UCEPI’s Rule 19 argument:

This narrow dispute simply does not implicate any of the more

general interests that Connecticut arguably could claim in the

development of the property and as lessor of the property itself.

Connecticut’s interests are separate and distinct from UCEPI’s

contractual obligations to ConnTech. . . . The express language of []

the lease . . . clearly demonstrates that Connecticut, ConnTech, and

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UCEPI all intended to keep Connecticut at arm’s length from the

activities contemplated by the [contract].

Id. at 682‐83.  Because it had kept the state‐owned corporation “at arm’s length,”

id.‐‐in that case, by contract‐‐any indirect interest of Connecticut in the outcome

of a lawsuit against UCEPI was insufficient under Rule 19.

To accomplish the goals of corporate separation and limited liability,

Connecticut employed a contract; New York employs statutes and constitutional

provisions.  New York has disclaimed liability for the financial obligations of

public‐benefit corporations like the Thruway Authority.  N.Y. Const. art. X, § 5.  It

has granted power to the Thruway Authority to “sue and be sued,” to “make

contracts,” and to “borrow money” on its own.  N.Y. Pub. Auth. Law § 354.  And

it has specified that the Thruway Authority is the “state” for “exercising the

powers and duties” given to it by the Canal Law, but “for no other purposes.”

N.Y. Canal Law § 5.  “The express language” of these provisions “clearly

demonstrates” that the State intended to keep itself “at arm’s length from the

activities” of the Thruway Authority.  ConnTech, 102 F.3d at 683.3

     3 The concurring opinion takes issue with our discussion of ConnTech.

Judge Newman perceives a distinction based on the relevant contract in

ConnTech, which “expressly disavowed” any direct financial responsibility for

Connecticut, see 102 F.3d at 683 n.3, “whereas an adverse judgment in our case

16

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New York and the Thruway Authority, having reserved and retained the

benefits of corporate separation for all other purposes, may not pierce their own

arrangements to accommodate litigation strategy.  That is so even if, as a practical

matter, a defeat for the Thruway Authority may have downstream effects that

cost the State money.  The State’s interest here is the same as its interest in the

fortunes of any other entity that contributes to a state function and thereby and to

that extent obviates an expenditure that the state might otherwise make.  Cf. Hess

v. Port Auth. Trans‐Hudson Corp., 513 U.S. 30, 50‐51 (1994) (“A charitable

organization may undertake rescue or other good work which, in its absence, we

would expect the State to shoulder.  But none would conclude, for example, that

in times of flood or famine the American Red Cross, to the extent it works for the

public, acquires the States’ Eleventh Amendment immunity.”); see also Askew v.

would create a serious financial risk for New York.”  Op. of Judge Newman at 6.

The distinction is not as strong as the affinity.  Just as in ConnTech, the State in

this case will have no direct financial obligation stemming from the judgment,

because of the corporate separateness it established.  See N.Y. Const. art. X, § 5.

In any event, we are not relying on stare decisis, and Judge Newman may be

right that ConnTech’s holding, standing alone, does not necessarily “defeat[] the

State’s claim” to a Rule 19 interest.  What matters is that New York’s interests in

this case are, by the State’s own design, “separate and distinct,” ConnTech, 102

F.3d at 682, from those of the Thruway Authority‐‐and that subverts the Thruway

Authority’s Rule 19 argument.

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Sheriff of Cook Cnty., Ill., 568 F.3d 632, 637 (7th Cir. 2009) (“[T]he County does

not become an ‘indispensable’ party [under Rule 19] just because it may need to

indemnify the Sheriff in the future . . . .”).  New York’s financial interest in the

outcome of this lawsuit‐‐however large‐‐is too remote and indirect to qualify as a

valid Rule 19 interest.

3.  The Thruway Authority contends that New York’s “interest[] in

defending the validity of its own laws,” Appellee Br. at 36, is an interest that

makes the State a necessary party under Rule 19.  No precedent supports that

view.  State (and federal) statutes are frequently challenged as unconstitutional

without the state (or federal) government as a named party.  A federal statute

contemplates such suits by providing a notice mechanism and relaxed

intervention rules for an absent sovereign in cases challenging the validity of its

laws.  See 28 U.S.C. § 2403(b) (in any federal suit “to which a State or any agency,

officer, or employee thereof is not a party, wherein the constitutionality of any

statute of that State affecting the public interest is drawn in question, the court

shall certify such fact to the attorney general of the State, and shall permit the

State to intervene . . . for argument on the question of constitutionality”); see also

id. § 2403(a) (analogous provision for the federal government).  If, as the

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Thruway Authority argues, a state is a necessary party in any lawsuit in which a

state statute is challenged as unconstitutional, there would be no need for these

procedures.

B

Even assuming that New York had a relevant “interest” protected by Rule

19(a), the State is only a necessary party if proceeding in its absence might, “as a

practical matter[,] impair or impede” New York’s “ability to protect [its]

interest.”  Fed. R. Civ. P. 19(a)(1)(B)(i).  As the text of the rule suggests,

“[p]ragmatic considerations are controlling” in conducting this inquiry.  See 7

Charles Alan Wright & Arthur R. Miller, Federal Practice & Procedure § 1601 (3d

ed. 2015).

In briefing and oral argument, the Thruway Authority warns of the grave

prejudice to be suffered by the State of New York if this case is litigated in its

absence.  That argument is advanced by counsel for the Thruway Authority, Eric

T. Schneiderman, the Attorney General of the State of New York.  So the careful

reader will notice that the Thruway Authority’s attorney is the chief legal officer

of the State of New York, and the head of New York’s Department of Law.  In

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this role, he “serves as the guardian of the legal rights of the citizens of New

York, its organizations and its natural resources.”  Our Office, Attorney General

Eric T. Schneiderman, http://www.ag.ny.gov/our‐office (last visited August 3,

2015).

Whatever interest New York has in the outcome of this lawsuit, we are

confident that Mr. Schneiderman will keep it in mind.  As we recognized in a

recent Rule 19 decision, “prejudice to absent parties approaches the vanishing

point when the remaining parties are represented by the same counsel, and when

the absent and remaining parties’ interests are aligned in all respects.”  Marvel,

726 F.3d at 134; see also United Transp. Union v. Long Island R. Co., 634 F.2d 19,

22 (2d Cir. 1980) (“[I]n light of the fact that the MTA and LIRR . . . took the same

position as the Attorney General would have taken, he cannot be heard to claim

that the disposition of the action in his absence impairs his ability to protect the

State’s interests.”), rev’d in part on other grounds, 455 U.S. 678 (1982).  The

Thruway Authority does not dispute that its interests are “aligned in all

respects,” Marvel, 726 F.3d at 134, with those of the State.  Nor could it‐‐were

there adversity between the Thruway Authority and the State, Attorney General

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Schneiderman would surely be conflicted out of his representation of the

Thruway Authority.  See N.Y. Rule of Prof’l Conduct 1.7.

The absence of prejudice to the State can be demonstrated by a

hypothetical.  If plaintiffs had named the State as an additional defendant, and

filed in state court to avoid an Eleventh Amendment problem, the substantive

Commerce Clause question would be briefed identically and by the same

counsel.  The only likely difference would be that New York might include a

separate defense that, because it is a legally distinct entity from the Thruway

Authority and is not liable for the Thruway’s obligations, the State should be

dismissed as a defendant.

It follows that, if this case cannot be litigated without New York, it will

proceed anyway‐‐in state court.  But Rule 19 is about protecting absent persons

from unfair prejudice‐‐it is not about giving a named defendant veto power over

the plaintiff’s chosen forum.  Cf. A.L. Smith Iron Co. v. Dickson, 141 F.2d 3, 6 (2d

Cir. 1944) (L. Hand, J.) (rejecting defendant’s argument that plaintiffs failed to

join a necessary party, reasoning that “the [absent party] can avoid . . . prejudice

by intervening in this action,” and “[t]hat being true, [his] only interest in the

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dismissal of the complaint is . . . in the choice of the forum in which . . . he will

assert his rights”).

Because, “as a practical matter,” any interest New York might have in this

litigation will be neither “impair[ed]” nor “impede[d]” by New York’s absence,

the State is not a necessary party under Rule 19(a).

III

Having concluded that the State of New York is not a necessary party

under Rule 19(a), we need not consider whether the State was also an

indispensable party under Rule 19(b), nor whether plaintiffs forfeited any

separate Rule 19(b) argument by failing to raise it in their opening brief.

CONCLUSION

For the foregoing reasons, we vacate the judgment of the district court and

remand for further proceedings consistent with this opinion.

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Case 14-3348, Document 76-1, 08/04/2015, 1568214, Page22 of 22