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v. NAT I ONAL RA I L RO AD P AS S E NGE R C OR P OR AT I ON (A M T R A K ); S OUT HE AS T E RN P E NNS YL VANI A T RA NS P OR T AT I ON A U T H O R IT Y ; C O M M O N W E A L T H O F P E N N S Y L V A N IA DE P AR T M E NT OF T RA NS P OR T AT I ON S o u t h e a s t e r n P e n n s yl v a n i a T r a n s p o r t a t i o n A u t h o r i t y,

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_______________ O n A p p ea l from the U n it ed S tat es D istri ct C o u rt f o r th e E a ste rn D istric t o f P e n n sy lv a n ia ( D

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. ( Fi l ed: D ece m ber22, 2009 )

_______________ T h o ma s S

. Bi e me r[ AR GUE D] M at t hew A

. Fol ey D i l w or t h Paxs on 1500 M arketSt r eet, Sui t e #3500E Phi l adel phi a, PA 19102 C o u n se l fo r Ap

p e lla n t So u th e a ste rn P e n n sy lva n ia Tr an s po r tat i on Autho r i t

y ( “SEPTA”) Wi l l i a m G

. Ba l l a i n e [ AR GUE D] L an d m an , C o rsi , B all aine & F o rd 1 2 0 B ro a d w a y- 2 7 F l. th N ew Y or k, N Y 10271- 0079 Paul F. X

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_______________ OPI NI ON O F THE COURT

_______________3 J O R D A N , C i r cui tJudge

. T h e S ou theast ern Pen ns y lv a n ia T ra n sp o rta tio n A u th o rity ( “SE PT A ”) appea l s fr om an orde r of t he U ni t ed St at es D i s t r i ct C o u rtfo r th e E astern D istri ct of P en n sy lvan ia gra n ti ng su m m ary j udgm ent t o t he N at i onal R ai l r oad Pas s engerC orpor at i on ( “A m t r ak”) on i t s cr os s-clai m agai ns tSE PT A

. T he D i s t r i ct C o u rt d e ter m in e d th a t S E P T A ’s s tate -la w so v e re ig n im m u n ity defe ns e i s pr eempt ed by A m t r ak’ s fede r al enabl i ng s t atut e and th a t an in d e m n ityc o n tra c t b e tw e e n S E P T A a n d A m tra k is th e re f o re e n f o r c e a b le. F o r th e f

o llo w in g re a so n s, w e w ill a f f i r m. I . Backg r ound A

. The A cci dent
T hi s di s put e a ri ses outof an a cci denton O ct ober28, 2004, i n w hi ch pl ai nt i ff Ri char d D ew ees e w as s t ruck byan A m t r ak tr ai n. T he dayof the ac ci dent , D ew ees e w as w ai t i ng fo r a Phi l adel phi a- bound SE PT A t r ai n att he C rum L ynne, Penns y l vani a tr ai n s t at ion, w hi ch i s adj ace ntt o tr acks us ed by b o th A m tr a k a n d S E P T A

. S om eon e atthe st at i on t old D ew eese t hatt he pl at form fr om w hi ch t o boar d the Phi l ad elphi a- bound t r ai n s was l o c a t e d o n t h e o p p o s i t e s i d e o f t h e t r a c k s . R at her t han us i ng t he s t ai r s avai l abl e t o hi m t o s afe l y cr os s t o t he other side , D ew ee se t o o k it u p o n h im self t o d esc en d fro m the p lat fo rm and w al k di r ect l yacr os s t he tr acks

. W hi l e doi ng s o, he w as stru c k b ya n o n c o m in g A m tra k tra in

. D e w e e se f iled su it i n sta te cour tagai ns tA m t r ak, SE PT A , and the C om m onw eal t h of Penns y l vani a t o r ecover d am ages r es ul t i ng fr om i nj ur i es heN otknow i ng t he ful l det ai l s of the a cc i dentand the 1 r ai l r oads ’ deci s i on t o s ett l e w i t h D ew ees e, a r eade rm aybe l eft b e w ild e re d b y th is br ief sy n o p sis , b u t th e u n d e rly in g law su it i s i rr el evan tt o the di spute pr esent l ybefo re us. 4 s us t ai ned as a r es ul tof the acc i dent

. A m t r ak r emoved t he ac t i on to f e d e ra l co u rt, an d th e C o m m o n w e a lth w a s s u b s e q u e n tly d ism iss e d a s a d e f

e n d a n t. P rio r to trial, D e w e e se se ttl e d h is cl ai m s w i t h SE PT A and A m t r ak fo r $200, 000, w i t h eac h defe ndantpay i ng D ew ees e $100, 000. T he s ett l ementl eft 1 unr es ol ved A m t r ak’ s cr os s - cl ai m a g a i n s tSEP TA fo rc o ntr actual indem nity , w hich w as based o n tw o separat e i nd e m n ity a g r e e me n t s b e t we e n Am t r a k a n d S E P T A.
B

. T h e In d e m n ity A g re e m e n ts A m t r ak ow ns t he C rum L ynne tr ai n s t at i on as w el l as the adj ace ntt r acks

. SE PT A l eas es t he s t at i on fro m A m t r ak pur s uant t o a 1987 agr eementent i t l ed “Leas e A gr eement betw een N at i onal R ai l r oad Pas s engerC orpor at i on and So u t h e a s t e r n Pe n n s y l v a n i a Tr a n s p o r t a t i o n Auth o r i t yCov e r i ng 47 C om m ut erSt at i ons i n s out heas t ern Penn sy lvani a” ( t he “Lease A gr eement ”)

. T he C rum L ynne s t at i on i s s ervi ced excl us i vel ybySE PT A , alt h o u gh SE PT A s har es us e of the r ai l r oad tr acks w i t h A m t r ak pur s uant t o a 1982 agr eementcal l ed t he “A gr eementbetw een N at i onal R ai l r oad Pas s enger C orpor at i on and Southeas t ern Penns y l vania T r ans por t at i on A ut hor i t yforN or t heas tC orr i dorA cce s s an d S ervi ces ” ( t he

“ N E C A g re e m e n t” ).Parag rap h 25 of the Leas e A gr eements t at es t he 2 f o llo w in g : L essee s hall i nd em nify , sav e and ho l d h arm l ess a n d d e f e n d L e ss o r .. . ag a in st a n d f ro m a n ya n d a ll cl ai m s and suit s fo r, and anyand al l l i abil i t y , l oss o r e x p e n se a risin g f

ro m o r in c id e n tal to o r in connec t i on w i th, damage t o or l os s of pr oper t yof L essor , L essee, or of agen t s, servan t s, l i censees, contr act or s , i nvi t ees or empl oy ees of ei t her , orof a n yo th e r p e rso n , an d a g a in st a n d f ro m a n ya n d a ll cl ai m s and suit s for, and any and al l l i abil i t y , l oss, o r e x p e n se a risin g f

ro m o r in c id e n tal to o r in con necti on w i t h, i njuryt o o r death o f perso ns, i ncludi ng agen t s, servan t s, con t ract ors, l i censees, 5 B ot h t he Leas e A gr eem entand the N E C A gr eement cont ai n i ndemni t ypr ovi s i ons . Sect i on 5 of t he N E C A gr eement in c lu d e s a “ R isk o f

L iab ili ty ” c lau se sta tin g th a t, S E P T A a g rees t o indem nifyand save ha rm l ess A m t r ak, i t s o ffi cer s , agent s , empl oy ees , and s ubs i di ar i es , i r r es pect i ve of any faul t of A m tr ak ors uch per s ons , foral l damage orfor l i abi l i t yfor p e rso n a l in

ju ryo r p ro p e rty d a m a g e w h ich w o u ld nothave be en i ncurr ed butfort he exi s t ence of the c o m m u te r s e rv ic e p ro v id e d f o r S E P T A

... . (A p p . at A 1 5 5

. ) T he Leas e A gr eementcont ai ns s i m i l ar l anguage . 2i nvi t ees orempl oy ees of Lessor o rof Less ee, or an yo ther p erso n , w h ich su ch d am ag e, loss, i n jury ordeath s hal l ar i s e in anym anner , di r ect l yor i ndi r ect l y , outof or i nci dent al t o ori n connec t i on w ith th is le a s e ... .” (A p p . a t A 1 3 3 -A 1 3 4 , ¶ 2 5 .) T he docke tentr i es an d the D i s t r i ctC our topi ni on r efe r 3 t o A m t r ak’ s cr os s - cl ai m as an ame n d ed cros s - cl ai m . T he re c o rd , h o w e v e r, d o e s n o t in d ica te h o w A m tra k ’s c ro ss -c laim h a s b e e n a m e n d e d . T h u s, f o r e a se o f re f

e re n c e , w e re f

e r to Amt r a k ’ s a me n d e d c r o s s - c l a i m a s s i mp l ya c r o s s - c l a i m. 6 Re l y i n g o n both t h e Le a s e Agr e e me n ta n d t h e NEC A g re e m e n t, A m tra k , as a lre a d yn o ted , file d a c ro ss -c laim 3 ag ains t SE P T A in the law su it that D ew ee se b rou g h t. A m tr ak ’s c laim , co n sis ten t th ro u g h o u t th is l it ig a tio n , is th a t S E P T A is o b lig a ted to in d e m n if

yA m tra k f

o r its se ttl e m e n t p a ym e n t to D e w e e s e . S E P T A r e s p o n d e d b y a s s e r t i n g s o v e r e i g n i m m u n i t y, s t at i ng i n i t s r epl yt o t he cr os s - cl ai m that“[a ] nyobl i gat i ons on SE PT A ’ s par tunderthe appl i cabl e [L ]eas e [A ] gr eementand [N E C A greem ent] t o i nd em nify , save and hol d harm l ess A M TRA K f

r o m p l a i n t i f

f ’ s c l a i ms a r e l i mi t e d , r e s t r i c t e d , and con dit i on ed b y , and su bj ectt o, S E P T A ’s i m m un i t yas a C om m onw eal t h par t y. . . . ” (A p p . a t A 2 9 .) A m tra k a n d S E P T A b o th m o v e d f o r su m m a ryju d g m e n t. S E P T A a rg u e d in its su m m a ry ju d g m e n t m o tio n th a t, d e sp ite its c l e a r c o n t r a c tu a l i n d e mni t y o b l i g a t i o n t o Am t r a k u n d e rt h e NECS E P T A a c k n o w led g e s th a t th e N E C a g r e e m e n t is 4 appl i cabl e t o t he pr es entact i on butdoes notconce de the a p p lica b ili tyo f th e L e a se A g re e m e n t. A rg u m e n t an d a n a ly sis in th e c a se h a v e th u s n a tu ra llyc e n ter e d o n th e N E C A g re e m e n t. W e t oo fo cu s on t hatpart i cul aragr eement , though our c o n c lu s io n s a re e q u a lly a p p lic a b le to th e L e a s e A g re e m e n t. SE PT A has not i nvoked s over ei gn i m m uni t yunderthe 5 E lev e n th A m e n d m e n t o f th e U n ited S tate s C o n stitu tio n ; ito n ly in v o k e s s o v e re ig n im m u n ity u n d e r P e n n s y lv a n ia s ta te la w . C f. Coope rv . SEPTA , 548 F.3d 2 9 6 , 311 ( 3d C i r . 2008) ( hol di ng t hat“S E PT A i s notent i t l ed t o E l eventh A m endment im m u n ity” ). 7 A gr eement , i ti s barr ed fr om i ndemni fy i ng A m t r ak bec aus e of

4 th e so v e re ig n im m u n ity c o n f e rre d u p o n it b yP e n n sy lv a n ia s tate s ta tu te , 1 P a . C o n s. S tat. A n n . § 2 3 1 0 a n d 4 2 P a . C o n s. S tat. A n n . § 8 5 2 1 -2 5

. S E P T A c o n c e d e d th a t, w e re it n o t f o r its 5 s t a t e - l a w s o v e r e i g n i mmun i t yd e f e n s e , i twou l d b e r e q u i r ed un der the N E C A greem ent t o “ho l d [A m t rak] harm l ess agai nst p lai n ti ff ’s claim s. ” (A p p . at A 1 6 8

. )
I n i t s ow n mot i o n f

o r s u mma r y j udgm ent , A m t r ak con t end ed thatanyst at e-l aw soverei gn i m m un i t ydefe nse pr offe r ed by SE PT A i s pr eempt ed by A m t r ak’ s enabl i ng s t atut e, 49 U

. S. C

. § 28103 , en act ed as par tof the A m t r ak R eform and A cc o u n tabili tyA ct of

1 9 9 7 (th e “ R ef

o rm A c t” ). T h e R ef

o rm A ct s t at es , among ot her t hi ngs , t hat “a pr ovi derof r ai l pas s enger t r ans por t at i on m ayent eri nt o contr act s t hatal l ocat e fi nanci al re sp o n sib ili ty f

o r cla im s.” 4 9 U .S .C

. § 2 8 1 0 3 (b ). T o su p p o rt itsSE PT A fur t herar gued thati tl acks t he pow er t o contr act 6 aw ayi t s s over ei gn i m m uni t yand that A m t r ak’ s cl ai m s do not fal l w i t hi n anyof th e sta tut or i l yenumer at ed exc ept i ons t o t hat im m u n ity . A m t r ak conc eded thatSE PT A does nothave the po w er t o w ai ve i t s s over ei gn i m m uni t ythr ough contr actand, th u s, d e sp ite th e N E C A g re e m e n t, d id n o t w a iv e th e o p p o rtu n ity to claim im m u n ity . A m tr ak in s te ad arg u ed that S E P T A ’s s o v e r e i g n i mmu n i t y c o n f e r s p r o t e c t i o n o n l ya g a i n s tc l a i ms s oundi ng i n t or t and t hat t he i ns t ant m at t er , w hi ch i m pl i cat es t he N E C A gr eement , pr es ent s a cont r actdi s put e t o w hi ch s over ei gn i m m uni t yi s i nappl i cabl e. SE PT A r es ponded thatA m t r ak w as col l at er al l yes t opped fr om l i t i gat i ng t he ap p li cabi l i t yof S E P T A ’s soverei gn i m m un i t yt o c on tr a c tua l ob l i ga t i on s becau se th a t issu e h a d b e e n p re v io u slya d ju d ica ted in S E P T A ’s f a v o r in a l aw s ui tcal l ed Apf

elbaum v. N

at i onalR

. R

. P as s . C or

p. , 2002 W L 3 2 3 4 2 4 8 1 (E .D . P a . O c t. 1 7 , 2 0 0 2 ). B ec au se w e ho ld th at § 2 8 1 0 3 (b) pree m p ts S E P T A ’s s over ei gn i m m uni t ydefe ns e, and thathol di ng w hol l ydi s pos es o f th e c a se , w e n e e d n o t ad d re ss th e p a rties ’ a rg u m e n ts a s to w hethers t at e- l aw s over ei gn i m m uni t yactual l yappl i es t o t he p re sent act i on , no r need w e add res s w hether A m t rak is 8 pos i t i on, A m t r ak r el i ed on a r ece ntdeci s i o n fr om t he U ni t ed S ta te s C o u rt o f A p p e a ls f o r t h e S e c o n d C ir c u it, O &G Industri es, Inc. v. N at i onalR

. R

. P as s engerC or p. , 537 F. 3d 153 ( 2d C i r. 2008) , w hi ch hel d t hat t he R eform A ctpr eempt ed a Connect i cut s t at e s t atut e governi ng i ndemni t ycontr act s , t o t he ext ent t hatt he t w o law s con fl i ct ed. S E P T A argued i n respon se that C on gress , i n enac t i ng 49 U

. S. C

. § 28103, di d noti nt end “to p rec lude the a p p lic a tio n o f

s ta te la w o n in d e m n ity c la u s e s .” (A p p . a t A 1 8 5 .) 6c o lla te ra lly e s to p p e d f ro m litig a tin g th a t is s u e . See U ni t ed Stat es v. Sanchez , 5 6 2 F

. 3 d 2 7 5 , 2 7 9 n . 5 (3d C ir

. 2 0 0 9 ) (co u rt need no tdeci de an i s s ue w hen ther e i s an al t ernat i ve and d ispo sit ive b asis fo r de cisi o n ). Or d i n a r i l y , d e c i d i n g t h e s c o p e o f a s t a tu t e w oul d be p r e f e r a b l e t o a d d r e s s i n g a c o n f l i c tb e t we e n f

e d e r a l a n d s t a t e l a w. H ow ever , w e deci de t hi s cas e on pr eempt i on gr ounds beca us e, fi r s t , pr eempt i on i s t he basi s of deci s i on chos en bythe D i s t r i ct C ou rtand i ti s w hat the p art i es have em ph asi zed in theirbri efs; s econd, t he s cope of

Penns y l vani a’ s s t atut e i s an i m por t ants t at el aw i ssue, bett er add res sed by P enn sy l van i a’s cou rt s i n the fi rs t i ns t ance ; and, fi nal l y , and m os ti m por t ant l y , the i s s ues pr es ent ed i n t hi s appea l ar e not confi ned t o Penns y l vani a. A s i ndi cat ed by bo t h the Sec on d C i rcui t ’s O &G Industri es ca se a n d the R ef o rm A c t’s le g isla tiv e h isto ry , the re is a n in c lin a tio n f o r re g io n a l ra il carr i er s t o s eek s hel ter fr om l i abi l i t y , des pi t e the contr actual o b lig a tio n s th e y h a v e u n d e rt a k e n . See inf ra , pag es 20-21

. T hu s, b e c a u s e t h e c o n f

l i c tb e t wee n f

e d e r a l a n d s t a t e l a w i mpl i cat ed h e re is f a rth e r re a c h in g th a n P e n n sy lv a n ia’ s s o v e re ign im m u n ity s t atut e, i ti s appr opr i at e fo r u s t o r es ol ve the ca s e on a br oader basi s. 9 C

. The D is tr i ct

C our tO pi ni on T h e D is tr i ctC ourt gran ted A m tr ak ’s m o ti o n fo r sum m ary j udgm entand deni ed SE PT A ’ s , fi ndi ng thatSE PT A ’ s s t at e- l aw s over ei gn i m m uni t y defe ns e w as pr eempt ed byt he R eform A ct u n d er the d o ctri n e o f im p li ed co n f lic t p ree m p ti o n . T h e C o u rt began bynot i ng t hatSupr eme C our t pr ece dent di ct at es a fi ndi ng of pr eempt i on w hen “the cha l l enged s t ate law s t ands as anBe c a u s e t h e Cou r tf o u n d t h a tSEP TA’ s s o v e r e i gn 7 i m m uni t y defe ns e w as pr eempt ed by t he R eform A ct , i tdi d not add res s w hether S E P T A ’s s tate -la w so v e rei gn i m m un i tydefe nse w as val i d u n d e r Penn sy l van i a st at e l aw , no r di d n ot i tdis cuss w hetherA m t r ak w as col l at er al l yest opped fr om l i t i gat i ng that is s u e . See sup ra , not e 6. A m tra k re m o v e d th e p re se n t ac tio n f ro m s ta te c o u rt to 8 fe d era l co u rt u n d er 28 U

. S

. C

. § 1 4 4 1

. T h e D istr ic t C o u rt exerci s ed j ur i s di ct i on pur s uantt o 28 U

. S. C

. § 1331. O ur juri sd ict ion arises u n d er 2 8 U

. S

. C

. § 1 2 9 1

. A d istri ct co u rt ’s g ra n t o f s u m m a ry ju d g m e n t is s u b je c t to p le n a ry re v ie w . H orn v. Thorat ec Corp. , 3 7 6 F .3 d 1 6 3 , 1 6 5 (3 d C ir. 2 0 0 4 ); see a l so Levy v

. St er l i ng H

oldi ng C o. , 544 F. 3d 493, 501 ( 3d C i r . 2008) ( “W e r evi ew de novo the gr antor deni al of s um m aryj udgm ent b ya d i s t r i c tc o u r t
. ” ) ( c i t a t i o n o mi t t e d )

. M o r e p a r t i c u l a r l y , we 10 o b sta c le to th e a c c o m p lish m e n t an d e x e c u tio n o f th e f u ll purpos es . . . of C ongr es s . ” ( A pp. at A 16- A 17. ) T he C our tt hen e x p lain e d th a t, b e c a u se th e R e f o rm A c t w a s e n a c ted in p a rt to ens ur e the enf

or ceabi l i tyof in d em n ifi ca ti o n ag ree m ent s betw een A m tra k a n d o th e r pa rties , a sta te- law so v e re ig n im m u n ity defe ns e s t ood as an i m perm i s s i ble o b st acl e t o t hatobj ect i ve. T he C our ts uppor t ed i t s hol di ng b y anal ogi zi ng t o the Second C i r cui t ’ s r eas oni ng i n O &G I ndus tr i es , 537 F. 3d at153, and concl uded that , “[t ] o t he ext ent t hat t he Penns y l vani a s over ei gn im m un i t y st atute con fl i ct s w i t h the R eform A ct , i tis p ree m p ted.” (A p p . at A 1 7

. )

7
I I . D i s cus s i on 8al s o exe rci s e pl enaryr evi ew overa pr eempt i on det erm i nat i on, a s it is a q u e s tio n o f

la w . H orn , 3 7 6 F .3 d a t 1 6 6

. 11 SE P T A pr es ent s a tw o- fol d ar gum ent , focus ed on the b rea d th o f th e p ree m p tio n ef fe cted b ythe D istri ct C o u rt ’s deci s i on and w hati tcont ends i s an i m pr oper l yr etr oact i ve c o n se q u e n c e o f

su c h p re e m p tio n in th is ca se . In a d v a n c in g its a r g u me n t , SEP TA, r e c o g n i z i n g t h e i mpo r t a n c e o f t h e Se c o nd Ci r c ui t ’s O &G I

ndus tr i es o p inion in the D istri ct C o u rt ’s anal y s i s , fr ames i t s di s cus s i on ar ound i s s ues addr es s ed i n that opi ni on and ass er t s t hat t he D i s t r i ct C our t fai l ed t o acc ountfor tw o c ritica l d ist in c tio n s b e tw e e n th a t ca se a n d th is o n e . F irst, S E P T A a rg u e s, th e P e n n sy lv a n ia s o v e re ig n im m u n itysta tu te is a la w o f g e n e ra l ap p lica b ili ty , w h e re a s th e C o n n e c ticu t sta tu te pr eempt ed i n O &G Industri es w a s a law sp e c if ica llye n a c ted to govern t he enfor cea bi l i t yof i ndemni fi cat i on contr act s , voi di ng i nd em nifi c a t i on agreem ents t o the ext ent theyw ou l d co ver gross neg l i gen ce byt he p artyseeki ng t o b e i nd em nifi ed. T hu s, S E PT A s ay s , pr eempt i ng the appl i cat i on of Penns y l vani a’s s t atut e w oul d r es ul ti n a dr amat i cal ly br oaderappl i cat i on of pr eempt i on t han occ ur r ed i n O &G I ndus tr i es . S econd, SE PT A ar gues t hat , even i f s uch a br oad appl i cat i on of pr eempt i on w er e w arr ant ed i n gener al , i tcannot be j us t i fi ed i n t hi s par t i cul arcas e bec aus e al l ow i ng pr eempt i on her e w oul d gi ve re t r oact i ve effec t t o t he R eform A ct
. W hi l e the in d e m n itya g re e m e n t in O &G Industri es w as i m pl ement ed af t er t he pas s age o f the R eform A ct , t he N E C A gr eementw as e x e c u t e d a d e c a d e p r i o rt o th e pa s s a ge of th e Re f o r m Ac t
. By S E P T A ’s r e a so n in g , ap p ly in g th e R e f o rm A c t to in d e m n ity12 a g re e m e n ts e n ter e d in to p r io r to th e e n a c tm e n t o f th a t sta tu te w oul d gi ve the s t atute an i m perm i s s i bl e r etr oact i ve ef fec t beca us e C ongr es s di d notexpr es s ly p rovi de forr etr oact i ve a p p lic a tio n . A m t r ak r es p o n d s thatthe D i s t r i ctC our tpr oper l yfound p re e m p tio n b e c a u se “ C o n g re ss io n a l h isto rym a k e s a b u n d a n tly cl eart hat[the R eform A ct ]

. . . appl i es br oadl yt o assu re t hat A m tra k ’s in d e m n itya g re e m e n ts w ith a n yo th e r p a rtya re f u lly e n f o rc ea b le w ith o u t r eg ard to an ystat e law o r pu b li c p o li c y .” ( A ppel l ee’ s A ns . B r . at12. ) A m t r ak furt herar gues thatfi ndi ng p re e m p tio n w ill n o t, i n f a c t, res u lt i n a n im p e r m is s ib le r etr oact i ve appl i cat i on of t he R eform A ct beca us e the i m por t ant even tfor pu rposes of a retroact i vityanaly si s i s not the p art i es’ exec ut i on of the N E C A gr eement i n 1992 butr atherthe ac crual o f A m tra k ’s r ig h t to in d e m n if ic a ti o n f o r th e D e w e e se c laim in 2004, w h ic h occurr ed s ever al y ear s aft erthe R eform A ctw as p a s s e d in 1 9 9 7

. A

. P r eem

pt i on T he p ri m ary focus of the part i es ’ at t ent i on, as i tw as of t he D i s t r i ctC our t opi ni on, i s w hetherPenns y l vani a’ s s over ei gn im m u n ity sta tu te , 1 Pa. C ons . St at
. A nn. § 2310 and 4 2 P a. C ons . St at
. A nn. §§ 8521- 25, i s pr eempt ed byA m t r ak’ s fede r al e n a b lin g s ta tu te , 4 9 U .S .C . § 2 8 1 0 3

. T he Supr emacyC l aus e, found i n A r t i cl e V I of the U ni t ed St at es C ons t i tut i on, pr ovi des t hatthe l aw s of the U ni t ed St at es “s hal l be the s upr em e L aw of the Land;

. . . anyT hi ng i n t he C o n sti tuti o n o r L aw s o f a n yS tat e to th e C o n tr ary13 no t w i t hs t a nd i ng . ” U

. S. C ons t
. art
. V I , cl

. 2. U ndert hatcl aus e, C on gress h a s t he p ow er “t o p reem pt s t at e l egis l at i on i f i tso i nt ends

. ” Hi T

e c h T ra n sp ., L L Cv . N

.J. D e p ’t o f E n v tl. P ro t. , 3 8 2 F

. 3 d 2 9 5 , 3 0 2 (3d C ir

. 2 0 0 4 ) (intern al qu o tat ion o m itted); see a lso G a d e v . N

a t’ l So li d W a ste M g m t. A ss’n , 505 U

. S. 88, 108 ( 199 2 ) (“ [U ] nderthe Supr emacyC l aus e, fr om w hi ch our p re -e m p tio n d o c trin e is d e riv e d , an ysta te la w , h o w e v e r c lea rly w i t hi n a S t at e’ s acknow l edged pow er , w hi ch i nt er fer es w i t h or is c o n tra ry to f

e d e ra l law , m u st y ield .”); G i bbons v. O gden , 22 U .S . 1 , 8 2 (1 8 2 4 ) (s ta tin g th a t “a c ts o f th e S ta te L e g is la tu re s ... [t hat] in ter f

e re w i t h, or ar e con t raryt o, t he law s of C on gress ” m us tbe i nval i dat ed, and that“the l aw of the St at e, though e n a c ted in th e e x e rc ise o f p o w e rs n o t co n tro v e rte d , m u st y ield to [ th e f e d e ra l law ]” ). W h ile th e S u p r e m a c yC lau se p lain ly pr o v ides C ongr es s w i t h the cons t i tut i onal pow ert o pr eempt s t at e l aw , t he cha l l enge f orcour t s has been de ci di ng w hen a confl i ctbetw een s t at e and fe d era l l aw r equi r es appl i cat i on of t h a t p o w e r. S e e Hin e s v . D a v ido w itz , 3 1 2 U. S. 5 2 , 6 7 ( 1 9 4 1) (ackno w l edg i ng t hat there i s not “an i nfall i ble const i tuti on al t est oran excl us i ve cons t i tut i onal y ar ds t i ck” f ort he appl i cat i on of p re e m p tio n ).
T he Supreme C our thas i dent i fi ed thr ee types of pr eempt i on: expr es s pr eempt i on, fi el d pr eempt i on, and i m pl i ed c o n f lic t p re e m p tio n . Hi l l

s b o r o u g h Cou n t

y , Fla . v . Au t om at ed Med. L abs

. , I

nc. , 4 7 1 U .S . 7 0 7 , 7 1 3 (1 9 8 5 ); B r ues ew i t zv. W yeth, I nc. , 5 6 1 F .3 d 2 3 3 , 2 3 8 -3 9 (3 d C ir . 2 0 0 9 ). T h e f irst, e x p re ss p re e m p tio n , ex ists w h e n C o n g re ss in c lu d e s in a sta tu te e x p lici t la n g u a g e sta tin g a n in ten t to p re e m p t co n f lictin g sta te la w . L o rilla rd T

o b a c c o C o . v. R e ill

y , 533 U

. S. 525, 541 ( 2001) ( “St at e ac t i on m aybe for ecl os ed byexpr es s l anguage i n aW e s o m e tim e s c a ll th is “ im p lie d o b s ta c le p re e m p tio n .” 9 H olk v. Snappl e B eve r ag e C o rp. , 5 7 5 F

. 3 d 3 2 9 , 3 3 4 (3d C ir

. 2 0 0 9 ). 14 cons t i tut i onal enac t m ent
. ”)

. T he s econd, fi el d pr eempt i on, occur s w hen a s t at e l aw i m pi nges up o n a “f i el d r es erved for f e d e ra l r e g u la tio n .” U

ni t ed St a te s v. Locke , 529 U

. S. 89, 111 ( 2000)

. T hi s form of pr eempt i on exi s t s “ei t her

. . . [w her e] the natur e of the r egul at ed s ubj ectm at t erperm i ts no ot her con cl us io n , or [w here] t he C on gress has un m i st akingl yso or dai ned. ” F l

. Li m e & Avocado G r ow ers , I nc. v. P aul , 37 3 U. S. 132, 142 ( 1963)

. L as t l y , and m os t s i gni fi cant l y fort he pr es ent cas e, i m pl i ed conf

l i ctpr eempt i on exi s t s w hen, “und er t he ci r cumst ance s of [a ] par t i cul arcas e, [the s t at e l aw ] s t ands as an o b sta c le to th e a c c o m p lish m e n t a n d e x e c u tio n o f th e f u ll p u rp o s e s a n d o b

je c tiv e s o f

C o n g re s s .” Hi nes , 312 U

. S. at67.

9
In a n a ly z in g a p o ten tial c o n f lict b e tw een f

ed e ra l an d sta te l aw , w e mustbe “gui ded .

. . ‘ bythe rule thatthe purpos e of C o n g ress is th e u lt im ate tou ch ston e in ev eryp ree m p ti o n ca se.’” Id

. at575 F. 3d at334 ( ci t i ng A l tr i a G r oup, I nc. v. G ood , 129 S

. C t. 5 3 8 , 5 4 3 (20 0 8 )). W e a re req u ir ed to co n side r “the en ti re s cheme of the [f

eder al ] s t atut e” an d ide nt i fy“i t s purpos e and int ended e ffe ct
. ” C rosby v. N at’ lForeign T

rade C ou ncil , 530 U

. S. 363, 373 ( 2000)

. O nl y t hen can w e det erm i ne w hethert he o p p o sin g s ta te law p re se n ts a “ su f f icie n t o b sta c le” su c h th a t it re q u ir e s p re e m p tio n . I

d. at374 n. 8. W hi l e ther e i s a r ecogni zed p re s u m p tio n a g a in s t p re e m p tio n , Ci p o l l o n e v . Li

g g e tG r oup, I nc. , 505 U

. S. 504, 516 ( 1992) , and w e s eek t o avoi d i tw hen p o s s ib le , Bat e s v . D ow Agr os c i e nc e s LLC , 544 U

. S. 431, 432,15 449 ( 2005) , confl i ct s t hatar e i m pl i ed byoper at i on of s t at e l aw ar e “of no l es s for ce than thatw hi ch i s expr es s ed. ” C r os by , 530 U

. S. at373 ( “I f the purpos e of the ac tcannot o the r w i s e be acc om pl i s hed .

. . t he s t at e l aw m us t y i el d t o the r egul at i on of C ongr es s w i t hi n t he s pher e of i t s del egat ed pow er . ”) ( ci t at i ons o m itt e d ). T h u s, in d e c id in g w h e th e r th e R e f o rm A c t p re e m p ts t he s over ei gn i m m uni t ythatSE PT A cl ai m s , w e musts crut i ni ze t he ef fec tof t he st at e l aw i nt erpr et at i on pr es s ed bySE PT A and “as c e r t a i n Con g r e s s ’ s i n t e n ti n e n a c t i n g t h e f e d e r a l s t a tu t e at i s s ue. ” Shaw v. D el ta A i rLi nes , I nc. , 4 6 3 U .S . 8 5 , 9 5 (1 9 9 3 ).
T he spec i fi c st atutoryprovis i on at is sue here i s § 28 10 3(b) of t he R eform A ct , w hich r eads as foll ow s: (b ) C o n tra c tu a l o b lig a tio n s— A p ro v id e r o f ra il p a ss e n g e r tra n sp o rta tio n m a y e n ter in to c o n tra c ts t hat al l ocate fi nan ci al res po nsi bil i t yfor cl ai m s. 49 U. S. C. § 2 8 1 0 3 ( b )

. Th e l a n g u a g e i s n e i t h e r c o mpl ex nor ambi guous . A pl ai n r eadi ng of thats i ngl e s ent ence r evea l s that t he A ctgr ant s A m t r ak pow ert o ent eri nt o bi ndi ng contr act s t hat al l ocat e fi nanci al r es pons i bi l i t yforcl ai m s agai ns ti t
. Such a r eadi ng i s confi r m ed byl ooki ng t o other l anguage i n t he s t atut e, par t i cul ar l yt he de scri pt i on of congr es s i onal fi ndi ngs , w hi ch i ncl ude that“( 1) i nt er ci t yr ai l p assenge rs ervi ce i s an es s ent i al componentof a na t i onal i nt erm odal pas sengertr ans por t at i on s y s t em; ( 2) A m t r ak i s fac i ng a fi nanci al cr i s i s , w i t h gr ow i ng and s ubs t ant i al debtobl i gat i ons s ever el yl i m i t i ng i t s abi l i t y t o cover oper at i ng cos t s and j eopar di zi ng i t s l ong- t erm vi abi l i t y ; and ( 3) i m m edi at e ac ti on i s r equi r ed t o i m pr ove A m tr ak’ s fi nanci al c o n d iti o n if

A m tra k is to su rv iv e .” 4 9 U .S .C . § 2 4 1 0 1 ; see al soT hi s appr oache s expr es s pr eem pt i on butdoes not 10 qual i fyas s uch bec aus e the l anguage of § 28103( b) , w hi l e cl ear i n it s i m pli cat i on , i s not expl i ci tabo ut p re e m p t i on . “E xp res s p re e m p tio n o c c u rs w h e n C o n g re ss ‘ e x p lic itl ysta te[ s]’ th a t it in te n d s a s ta tu te to h a v e th a t e f f e c t. Jones v. R ath P acki ng C o. , 4 3 0 U .S . 5 1 9 , 5 2 5 (1 9 7 7 ). S u c h p re e m p tio n is th u s g e n e ra lly f o u n d o n lyw h e n C o n g re ss h a s u s e d lan g u a g e th a t ex p re ss ly p re c lu d e s s ta te re g u l a tio n in a g iv e n a re a . S e e S t. T h o m a s-S t. John H ot el & Tour is m A s s ’ n, I

nc. v. G ov’ tof

the U ni t ed Stat es V i r gi n I s l ands , 218 F. 3d 232, 2 3 8 (3d C i r . 2000) ( hol di ng t hat e x p re ss p re e m p tio n o n ly“ a rise s w h e n th e re is a n e x p licit 16 A m t rak R eform A ct , P ub

. L

. 1 0 5 -1 3 4, 10 5th C on gress , 1st S e s s io n , 1 1 1 S ta t. 2 5 7 0 , 2 5 7 1 , § 2

. T he b road w ordi ng of § 28 10 3(b), com bined w i t h those f in d in g s, sh o w s th a t su b se c ti o n (b ) w a s e n a c ted to f a c ili tate A m tra k ’s e n ter in g in to c o n tra c ts to tra n sf e r liab ili tyrisk to e n tit ies lik e S E P T A . P e n n s ylv a n ia’ s s o v e re ig n im m u n ity sta tu te, i f a p p lied a s S E P T A u rg e s, w o u ld b e a c o m p lete ob st acl e t o A m t rak’ s abi l i t y t o enter i nto suc h co ntr act s becau se it w ou l d d i rect l ypreven tA m t rak from being ab l e t o all o c a te fi nanci al r es pons i bi l i t yt o SE PT A

. Per m i t t i ng t he i nvocat i on of s over ei gn i m m uni t yw oul d thus have the i m perm i s s i bl e i m pact of pr event i ng A m t r ak fr om doi ng exac t l yw hatt he R eform A ct s ay s A m t r ak ca n do, t her ebym ovi n g A m t r ak t ow ar ds t he fi n anci al i ns t abi l i t ythatthe R eform A cts oughtt o avoi d. T h e r e f o r e , b a s e d o n t h e p l a i n l a n g u a g e o f t h e s t a tu t e , we concl ude thatt he R eform A ctpr eempt s the appl i cat i on of Penns y l vani a’ s s over ei gn i m m uni t ys t atut e. 10sta tu to ryc o m m a n d th a t sta te la w b e d isp lac e d ” ); see a l so R ush P r udent i al H

M O , I nc. v. Mor an , 536 U

. S. 355, 364 ( des cr i bi ng th e “ e x p re ss p re e m p tio n ” lan g u a g e in E R IS A ); Spr i et s m a v. Mer cur y M ar i ne , 537 U

. S. 51, 62- 63 ( “B eca us e t he [Fede r al B oatSafetyA ct ] cont ai ns an expr es s pr e-em p t i on cl aus e, our t as k of s t atut or ycons t ruct i on m us ti n the fi r s ti ns t ance focus on the p lai n w o rdin g o f th e c laus e .. . . ”). 17 I f the pl ai n l anguage of the s t atut e w er e notcl earenough t o demonstr at e con g r es s i onal i nt ent , the l egi s l at i ve hi s t oryof the R e f o rm A c t is

. See U

ni t ed Stat es v. G r egg , 226 F. 3d 253, 257 (3 d C ir. 2 0 0 0 ) (“ T o d e ter m in e a law ’s p lain m e a n in g , w e b e g in w ith th e lan g u a g e o f

th e s ta tu te. If

th e lan g u a g e o f

th e sta tu te ex p resse s C o n g ress’s inten t w ith su ff ici entpr eci s i on, the i nq u iry end s there .

. . . W here the st atutoryl ang uag e do es not ex p re ss C o n g re s s ’s in ten t u n e q u iv o c a lly , a c o u rt tra d iti o n a llyre f e rs to th e leg isla tiv e h isto ry .. . . ” ). T h a t h isto ryo n ly se rv e s to s t r engthen the conc l us i on of i m pl i ed conf l i ctpr eempt i on. A Senat e R eportexpl ai ns thatthe R eform A ctw as des i gned t o “ena bl e A m t r ak to inc r eas e ef fi ci enci es , r educe cos t s , and [t o] perm i tchange s t o i t s l i abi l i t y . ” S. R ep. N o. 105- 85 at 1, C om m i t t ee on C om m er ce, Sci ence , and Tra ns por t at i on, 1 0 5 th C o n g ress, 1 st S essio n (S ep t. 2 4 , 1 9 9 7 ) (“S en ate R ep o rt ”). T h e R e p o rt h ig h lig h ts th e im p o rta n c e o f th e ra ilro a d s in th is r egi on of the countr y and caut i ons t hat , i f t he R eform A ctfai l ed to b e c o m e law , b a n k r u p tc yc o u ld o c c u r, b e c a u se “ A m tra k is s t aki n g t he futur e of the nat i onal s y s t em on t he pr oj ect ed fi nan ci al success of hig h sp e ed rai l service i n the N ortheast C or r i dor

. ” Id

. a t 2 -3 ; s e e a ls o id

. at 12 ( expl ai ni ng the “ur gent18 need f ori m m edi at e ac t i on t o i m pr ove A m t r ak’ s fi nanci al condi t i on and el i m i nat e i t s depende ncy. . . . ”)

. W i t h r egar d t o § 28103( b) i n par t i cul ar , t he Senat e R epor texplai ns t hatt he purpos e behi nd t hats ubs ect ion is t o “cl ar i f[y ] that in d e m n if ica tio n a g re e m e n ts re late d to th e p ro v isio n o f ra il pas s engerserv ice e nt er ed i nt o byA m t r ak and otherpar t i es w oul d be enf

or cea bl e. ” Id

. a t 5 ; s ee al s o i d. at14 ( “Subs ect i on (b ) ... c la r if

ies th a t ra il p a ss e n g e r in d e m n if ica tio n a g re e m e n ts en tered into b yA m tr ak an d o ther p arti es are e n fo rce ab le. ”). I n f a c t, th e R e p o rt o u tli n e s a sc e n a rio c lo se ly a n a lo g o u s to w h a t is ati s s ue her e: As l o n g a s t h e r e i s t h e p o s s i b i l i t yt h a ts t a t e l a ws governi ng i ndemni fi cat ion c ont r act s m aym ake t hos e contr act s unenfor cea bl e, A m t r ak an d a fr ei ghtr ai l r oad mayfi n d t hemsel ves l i t i gat i ng w i t h eac h ot her

. A m t r ak bel i eves that s uch lit ig a tio n in e v itab lyw o u ld n o t o n lya d v e rse ly i m pactbus i nes s r el at i ons hi ps betw een A m t r ak and t he h ostfrei gh trai l roads, bu ti tw ou l d als o lea d to sig n if

ica n tlyh ig h e r o u tlay s in se ttl e m e n ts and j ud gm ents t o p l ai nti ffs. Id

. a t 5

. A re p o rt f

ro m th e H o u se o f

R e p re se n ta tiv e s s im ilarly e m p h a s ize s th a t “in d e m n ityc o n tra c ts ... a re f u llye n f o rc e a b le w i t houtr egar d t o anyot herl aw orpubl i c p o li cy . ” H

. R

. R ep. N o. 105- 251 at15, C om m i t t ee on Tr ansport at i on and I nfr as t ructur e, 105t h C ongr es s , 1s t S es s i on ( Sept

. 17, 1997) ( “H ous e R epor t ”)

. T he H ous e R epor ti s expl i ci tt hat“a c ruci al19 fea tur e of the l i abi l i t y r eform pr ovi s i on i s the af fi r m at i on of the r i ghtof ow ner s of .

. . p as s engeroper at or s t o i ndemni fyby contr act
. ” Id

. a t 1 7

. I n s hor t , l egi s l a t i v e hi s t oryr evea l s thatgi vi ng A m t r ak the f re e d o m to n e g o tiate a g re e m e n ts w ith o th e r c a rrie rs to a llo c a te t he fi nanci al cons equenc es of l i abi l i t y w as a keycomponentof th e R e f o rm A c t, an d § 2 8 1 0 3 (b ) w a s s p e c if ic a llyn e e d e d to el i m i nate “the p ossi bil i t y t hat st at e l aw s can nu l l i fy[A m t rak’ s] i ndemni fi cat i on contr act s. ” Sen ate Rep ort , at14. T he P e n n sy lv a n ia s o v e re ig n im m u n itysta tu te, to th e e x ten t itc o u ld nul l ify the N E C A gr eement , s t ands as a di r ectobs t acl e t o that g o a l, a n d , a s s u c h , is p re e m p te d

. SE PT A offe r s s ever al argum ent s fornotgi vi ng pr eempt i v e e f

f e c tt o t h e Re f

o r m A c t
. Ea c h i s u n p e r s u a s i ve. F i r s t , S E P T A n o t e s t h a t§ 2 8 1 0 3 ( b ) s t a t e s t h a tA m t r a k “ m a y” ent eri nt o i ndemni t ycontr act s . ” SE PT A then s ay s thatthe s t atut or yl anguage i s “mer el yperm i s s i ve” and so i s i ns uffi ci ent to “ju sti fysu ch a b roa d p ree m p ti o n o f state law

. ” (A p p ell an t’ s O p . B r. at 1 3 .) H o w e v e r, itc ites n o p re c e d e n t to su p p o rt its c o n ten tio n th a t a s tatu te h a s le ss p re e m p tiv e f o rc e b e c a u se it author i zes r athert han comp els ce r t ai n act s . M or eover , i tdoes notexpl ai n how t he R eform A ct can be r eas onabl y r ead t o gi ve A m tra k th e o p tio n to e n ter in to in d e m n ity c o n tr a c ts w h ile sim u lta n e o u slyg iv in g e n tit ies lik e S E P T A th e p re ro g a tiv e to ig n o re th o s e s a m e c o n tr a c ts
. S e c o n d , rely in g o n th e p rin c ip le th a t p re e m p tio n a n a ly sis sh o u ld attem p t t o “re co n cil e the o p e ra ti o n o f b o th statutory s chemes w i t h one another , ” Hi Tech Tr ans p. , 3 8 2 F. 3d at302,A s s u m m a riz e d b y th e D istric t C o u rt, 4 2 P a . C o n s. S tat. 11 A n n .§ 8 5 2 2 (b ) sta tes th a t [T]he defe ns e of s over ei gn i m m uni t y s hal l notbe r ai s ed t o clai m s caus ed by : ( 1) t he oper at i on of any m ot or vehi cl e i n t he pos s es s i on orcontr ol of a C o m m o n w ea lth p arty ; ( 2 ) a c ts o f h ea lth ca re empl oy ees o f C om m onw eal t h agenc ym edi cal f a c ili ties o r in stitu tio n s o r b ya C o m m o n w e a lth par t yw ho i s a doc tor , dent i s t , nur s e orr el at ed heal t h car e p er s onnel ; ( 3) t he ca r e, cus t odyor contr ol of per s onal pr opertyi n t he pos s es s i on or co n tro l o f C o m m o n w ea lth p arti es; (4) a d anger ous condi t i on of C om m onw eal t h agenc y r eal es t at e and s i dew al ks ; ( 5) a dange r ous condi t i on of hi ghw ay s undert he j ur i s di ct i on of a C om m onw eal t h agenc ycr eat ed bypot hol es or s i nkhol es orot hers i m i l arcondi ti o n s cr eat ed by natur al el ement s ; ( 6) t he ca r e, cus t odyorcontr ol of ani m al s i n t he pos s es s i on o r c ont r ol of a C om m onw eal t h par t y ; ( 7) t he s al e of l i quorat Penns y l vani a l i qu o r stor es ; ( 8) act s of a mem ber of the Penns y l vani a mi l i t aryfor ces ; or( 9) the a d m in istra tio n , m a n u f

a c tu re a n d u se o f

a to x o id 20 SE PT A s ugges t s t hati t s s t at e- l aw s over ei gn imm uni t yand the R eform A ct c an be r econc i l ed bec aus e ther e ar e enumer at ed exc e pt i on s t o the i mm un i t y . W hi l e t he r e a r e , a s SEPTA s a y s, n ine e n u m era ted e x ce p ti o n s to it s so v ere ign im m u n ity , theyare narr ow and have no i m pact on SE PT A ’ s i ndemni t yobl i gat i on

11o r v a c c in e . ( A pp. atA 8 ( ci t i ng 4 2 P a . C o n s . S ta t. A n n . § 8 5 2 2 (b )) .) S u b se c tio n (a ) p re e m p ts s tate la w w ith re sp e c t to 12 p u n it ive d am ag es a n d ag g reg ate li ab il ity . 4 9 U

. S

. C

. § 2 8 1 0 3 (a). See sup ra , n. 10. 13 21 t o A m t r ak. I ndeed, i ti s s ur el y onl ybeca us e theyhave no i m pact her e thatSE PT A ci t es t hem, for , i f theydi d acc om m odat e the p u rpo se o f th e R ef

o rm A ct, theyw o u ld ru n co u n ter to S E P T A ’s e f f o rt to e sc a p e liab ili ty . C o n tra ryto w h a t S E P T A su g g e sts , it i s notpos s i bl e t o r econc i l e the cl ai m o f st at e- l aw s over ei gn im m u n ityw ith th e e x p re ss p u rp o se o f th e R e f o rm A c t. T hi r d, SE PT A ar gues thatC ongr es s coul d n o thave i ntended § 2 8 1 0 3 (b ) to h a v e p re e m p tiv e e f f e c t b e c a u se C on gress chos e t o i ncl ude an e xpl i ci ts t at ementof pr eempt i on i n another su b se c tio n o f

th e sta tu te, § 2 8 1 0 3 (a ). C o n g re ss k n e w h o w to 12 br oadl y pr eempts t at e l aw i f i ts o i nt ended, SE PT A ar gues , and C o n g r e s s d i d n o ti n t e n d t o d o s o b ys u b s e c t i o n ( b )

. We ackn ow l edg e t hat § 281 03 (b) do es not contain a n exp res s p re e m p tio n c lau se . H o w e v e r, ev e n th o u g h su b se c tio n (b ) is 13 notexpr es s l ypr eempt i ve, i t i s s t i l l qui t e cl ear . T he pr eempt i ve cons equenc es of i t s l anguage ar e s uffi ci ent l ypl ai n forus t o s ay t hatC ongr es s i nt ended t o obvi at e all obs t acl es t o the enfor cea bi l i t yof contr act s t o i n d em n ifyA m t r ak. Fur t her , t he expr es s i on of pr eempt i on i n one s ubs ect i on does notm ean that pr eempt i on w as noti nt ended byt he l anguage of a not her22 s u b s e c tio n o n a n o th e r t o p ic

. S e e B ru e se w itz , 5 6 1 F

. 3 d at 2 3 9 (“ [I] m pli e d p re e m pti on m ayexis teven i n the face of an ex press p re e m p tio n c lau se .”); s ee al s o Fr ei ght l i ner C or

p. v. M yr i ck , 514 U

. S

. 28 0, 28 8 (199 5) ( no t i ng that an exp res s preem pti on cl ause i n a s t atut e does not “for ecl os e [the] pos s i bi l i t yof i m pl i ed pr ee m p tio n ” ). A g a in , “ th e p u rp o se o f C o n g re ss is th e u lti m a te t ouchs t one i n everypr eemp t i on cas e, ” H olk 575 F. 3d at334, a n d , as d isc u ss e d a b o v e , the p u rp o se h e re is n o t in d o u b t: § 28103( b) w as pas s ed t o “cl ar i f[y ] t hat r ai l pas s eng er se r vi ce i n d e mni f i c a t i o n a g r e e me n t s e n t e r e d i n t o b yAm t r a k a n d o t her par t i es ar e enf

or cea bl e. ” S e n a te R e

p o rt a t 1 4

. F o u rth , S E P T A c o n ten d s th a t it s s o v e re ig n im m u n ity defe ns e s houl d notbe pr eempt ed be ca u se “Congre s s w as c e rta in lya w a re o f

S E P T A ’s s tatu s w ith re sp e c t to liab ili tyy e t it chos e nott o expr es s ly p r eemptt hats t atus . ” ( A ppel l ant ’ s O p. B r. a t 1 6 .) T h is a rg u m e n t, p u t f o rw a rd w ith n o su p p o rt, res ts o n t h e pe c u l i a rp r o p o s i t i o n th a tCon g r e s s k n e w t h a tSEP TA w o u ld e n ter in to in d e m n ity c o n tra c ts w ith n o in ten t o r c a p a c ity t o h o n o r t h e m. I t i s t ru e t h a t Co n g r e s s wa s a wa r e t h a ts t a t e l a ws e x iste d “ to p ro tec t th e ta x p a y e rs w h o u lti m a telyb e a r th e c o sts o f to rt lia b ility in c u rr e d in p ro v id in g th e p u b lic tr a n s p o rt a tio n .” H ou se R epo rt , a t2 1

. I n f a c t , r e c o g n i z i n g t h e th r e a tth o s e l a ws po sed t o the vi abil i t yof indem nityagreem ents , the H ou se w a rn e d th a t “[ w ] ith o u t th e c o n f irm a tio n th a t in d e m n ity a g re e m e n ts w ill b e u p h e ld in c o u rt, [ A m tra k ] w ill b e p lac e d in j eopar dyas [i t ] r es i s t s t aki ng on w hat i s i ncr eas i ngl yvi ew ed as an u n accept abl e and unc om pens at ed l i abi l i t yexpos ur e. ” I d. B utt hatdoes notm ean thatC ongr es s w as “ce r t ai nl yaw ar e” of t he s over ei gn i m m uni t y pos i t i on t hat SE PT A w oul d t ake w hen r enegi ng on i t s i ndemni t yobl i gat i ons . E ven i f C ongr es s had23 been a w ar e of SEP T A ’ s bai t
- and- s w i t ch pos i t i on, how ever , the i nt entof t he R eform A ct r emai ns cl eari n i t s comm i t m entt o the enfo rcem ent of t ho se obli gati on s. Fi nal l y , SE PT A argu es t hatC ongr es s , i n enac t i ng § 2 8 1 0 3 (b ), o n lyin ten d e d to p re e m p t sta te la w s e x p re ss ly g o v ern ing the e n fo rce ab il ityo f i n d em n ity co n tr ac ts, an d , m o re sp ec ifi ca ll y , stat e law s that p roh ibit ind em n ifi ca ti o n w h en there i s a fi nd i ng of gross neg l i gen ce. A ccordi ng l y , S E P T A reas on s, th e R e f o rm A c t sh o u ld p re e m p t o n lyth a t s p e c if ic k in d o f

sta te law , a n d n o t a law o f g en era l app li ca b il ityli k e P en n sy lvan ia’s s over ei gn i m m uni t y stat u te
. A fi ndi ng of pr eempt i on i n t he p re se n t ca se , sa y s S E P T A , w o u ld b e f a r to o “ v a st,” a n d w o u ld “w i pe aw ayal l pr i nci pl es of s t at e cont rac tl aw t hatm aybe ut i l i zed a s a def

ense t o contr actual l i abi l i t yand/ orcontr act fo rm ati o n . ” (A p p ell an t’ s O p . B r. at 13

. )
T h e R e f o rm A c t w a s in d e e d in ten d e d to p r e e m p t sta te l aw s of the s ortdes cr i bed bySE PT A

. I n fac t , s ubsec ti on ( b) w as pas s ed i n par t t o s uper s ede N at i onalR

. R

. P as s engerC or p. v. C ons ol i dat ed R ailC or p. , 698 F. Supp. 951 ( D

. D

. C

. 1988) ( overrul e d o n o th e rg r o u n d s ) , w hi ch hel d t hatan i ndemni fi cat i on agr eementbetw een A m tr ak and ConR ai l vi ol at ed D i s t r i ctof C o lu m b ia p u b lic p o licyb e c a u se it allo w e d in d e m n if ica tio n in the co n text o f gro ss neg lig e n c e . See Hou se R epo rt , at33- 44; see al so O &G Indus. , 537 F. 3d at166- 67 ( “[I ] tw as pr eci s el yt he doubt s cas tbyt he [ C o n so lida tedR a il ] d e c isio n o v e r th e v a lid ity of i ndemni t yagr eement s byr ai l r o ad par t i es thatpr om pt ed C o n g ress to e n a c t § 2 8 1 0 3 (b).”). Itd o es n o t fo ll o w , h o w ev er, t h a tt h a tw a s t h e l i m i to f c o n g r e s s i o n a l i n t e n t
. T o th e c o n t r a r y, it w o u l d be odd t o s uppos e thatC ongr es s m eantt o el i m i nat e aThe Secon d C i rcui tfi nd s preem pti on i n thr ee scenari os: 14 “( 1) w her e C ongr es s expr es s l ys t at es i t s i nt ent to pr eempt ; ( 2) w h e re C o n g re ss ’s s c h e m e o f f e d e ra l re g u latio n is s u f f icie n tly c o m p re h e n siv e to g iv e rise to a r e a s o n a b le in f e re n c e th a t it l eave s no r oom fort he s t at e t o act ; and (3 ) w her e s t at e l aw actual l yconfl i ct s w i t h fede r al l aw . ” O &G I ndus tr i es , 537 F. 3d at161. I n O &G Indus tr i es , the Second Ci r cui tfound 24 sp e c if ic o b sta c le to its p u rp o se o f p ro tec tin g A m tra k ’s a b ili tyto s pr ead r isk buthad no conc ern w i t h a br oaderobs t acl e havi ng the s a m e e f

fe ct. T h e R ef

o rm A ct’s l eg isl ati v e h ist o ry d e m on strat es t hat C on gress i ntended t o overr i de any and a ll s t at e l a ws t h a tmi g h ti n t e r f e r e wi t h t h e e n f

o r c e a b i l i t yof A m tra k ’s c o n tra c ts, n o t o n lyth o se sta te la w s s p e c if ica lly e n a c te d to g o v e rn in d e m n ity a g re e m e n ts
. See Hou se R epo rt , at 13 ( “[I ] ndemni t ycontr act s . . . ar e ful ly en for cea bl e w i t hout r egar d t o any other law o r p u b lic p o licy .”) ( e m p h a sis a d d e d ); c f. O &G Indus. , 5 3 7 F .3 d a t 1 6 0 -6 3 (re jec tin g th e a rg u m e n t th a t § 28103( b) onl yappl i es t o i ndemni t ycontr act s w i t h fr ei ght rail roa d s, an d h o lding that the R ef o rm A ct w as m ea n t “t o en su re t he enf or cea bi l i t yof i ndem ni t yagr eement s A m t r ak conc l udes w i t h any o ther p arty
. ”)
T h e S ec o n d C ir cu it ’s opi ni on i n O &G Industri es supp o rts that co n clus ion

. In O &G I ndus tr i es , th e S e c o n d C ir c u it h e ld t hat § 2 8 1 03( b) pr eempt ed a Connect i cuts t atut e w hi ch, on publ i c pol i cygr ounds , voi ded anyi nd emni t ypr ovi s i on cont ai ned i n cons t ruct i on- r el at ed contr act s , i f the pr o v i s i on purpor t ed t o i ndemni fy a par t y agai ns ti t s ow n negl i gence . 537 F .3 d a t 1 5 8 ; s ee al

s o Con n . Gen

. St a t
. § 5 2

- 5 7 2 k ( a )

. The 14p re e m p tio n u n d e r i ts th ir d c a te g o ry, c o n f lic t p re e m p tio n , i d. , w hi ch i s anal ogous t o ourfi n di ng of i m pl i ed conf l i ct pr eempt i on. 25 C ou rtrej ect ed O & G Indust ri es’ argum ent t hat there w as a l i m i t at i on on t he ki nds of c o nfl i ct i ng s t at e l aw s pr eempt ed by t he R eform A ct , s t at i ng that [t ] he goal of the R eform A ctw as t o s hi el d a ll of A mt r a k ’ s i n d e mni t ya rr a n g e me n t s f r o m l e g al att ac k s o n their v ali d ity . [In en ac ti n g § 2 8 1 0 3 (b)], C o n g re ss ... en c o u ra g e d a ll p ro v id e rs o f ra il p a ss e n g e r tra n sp o rta tio n to e n ter in to c o n tra c ts th a t a llo c a te f

in a n c ia l r e s p o n s ib ility f

o r c la im s ... . C ongr es s al s o aff

i r m ed the enf

or cea bl i t yof con tra c ts th a t in c lu d e in d e m nifi cat i on ob l i gati on s. O &G I ndus

. , 537 F. 3d at 1 62 ( ci t at i on om i t t ed) ( or i gi nal em p h asis).
T hus , as ours ist erci r cui tdeci ded, C ongr es s i nt ended w ith th e p a ss a g e o f th e R e f o rm A c t, a n d , m o re sp e c if ica lly , w ith th e p a ss a g e o f

§ 2 8 1 0 3 (b ), th a t all o f A m tra k ’s in d e m n ity agr eement s s houl d be enf or cea bl e, r egard less of the ki nd of confl i ct i ng s t at e l aw t hatm i ghtbe er ect ed. SE PT A ’ s s t at e- l aw s over ei gn i m m uni t yas s ert i on di r ect l yconfl i ct s w i t h t he enfor cementof i t s i ndemni t ycontr actw i t h A m t r ak and thus pr es ent s an i r r econc i l abl e obs t acl e t o t he obj ect i ves ofL es tt her e be a nym i s under s t andi ng, w e emphas i ze that 15 t hi s does notcons t i tut e a ge ner al pr eempt i on ori nval i dat i on of Penns y l vani a’ s s over ei gn i m m uni t ys t atut e. W e hol d onl ythat SE PT A ’ s eff

or tt o i nvoke thats tat u t e t o es cape the cons equenc es of i t s i ndemni t y obl i gat i ons t o A m t r ak ca nnotbe perm i t t ed, fort he r eas ons s t at ed. 26 § 2 8 1 0 3 (b ). A c c o rd in g ly , tha t in v o c a tio n o f soverei gn i m m un ity i s pr eempt ed under pr i nci pl es of i m pl i ed conf l i ctpr eempt i on. 15
B

. P re e m

p tio n a n d

R e tro a c tivity SE PT A al s o ar gu es t hat , even i f s om e cl ai m s of s over ei gn i m m uni t y ar e pre empt ed by§ 28103( b) , t her e ca n be no pr eempt i on her e w i t houtgi vi ng the R eform A ctan i m perm i s s i bl e r etr oact i ve ef fec t
. T he N E C A gr eementw as e x e c u t e d a d e c a d e p r i o r t o t h e p a s s a g e o f t h e R e f o r m Ac t
. By S E P T A ’s r e a so n in g , ap p ly in g th e R e f o rm A c t to a n in d e m n ity a g re e m e n t e n te r e d in to p rio r to th e e n a c tm e n t o f th a t sta tu te is unt enable b ecaus e C ongr es s di d notexpr es s l ypr ovi de for re tr o a c tiv e a p p lic a tio n . B ef o re a sk ing w h ethe r C o n g re ss inten d ed the R ef o rm A ctt o have a nyr etr oact i ve ef fec t , w e m us tfi r s tas k w hetherthe s t atut e eve n has s uch an e ffe ct
. A s t atut e “ha s r etr oact i ve ef fec t w hen i t‘ t akes aw ayori m pai r s ves t ed r i ght s acqui r ed under e x i s t i n g l a w s , o r c r e a t e s a n e w o b l i g a t i o n , i m p o s e s a n e w d u t y, orat t ache s a new di s abi l i t y , i n r es pectt o t r ansa cti ons or cons i der at i ons al r eadypas t
. ’ ” Id

. at227 ( ci t i ng Landgraf v. U SI F i lm P rods. , 5 1 1 U

. S

. 2 4 4 , 2 6 9 (19 9 4 )). A n aly zing w h ethe r a27 s t a tu t e o p e r a t e s r e t r o a c t i v e l y “ i s n o t a l way s a s i mpl e or m echa ni cal t as k. ” I

d. at26 8. T he an al y si s re q u ire s a
“ c o m m o n se n se , fu n c tio n a l ju d g m e n t as to w h e th e r a sta tu te at t ache s new l egal cons equenc es . ” A tki ns on v. A t t ’ y G en. , 479 F

. 3d 22 2, 23 1 ( 3d Ci r . 20 07 )

. I n s e e ki ng t ha tc omm on s e ns e ans w er , w e ca n “b e g u ide d bycons i der at i ons of fa i rnot i ce, r e a s o n a b l e r e l i a n c e , a n d s e t t l e d e x p e c t a t i o n s . ” Id . (em p h a sis o m itt e d ). M o re o v e r, “[ a ] sta tu te doe s not operat e retro sp e c tiv e ly m er el y becaus e i t i s appl i ed i n a cas e ar i s i ng fro m conduct ant edat i ng t he s t atut e’ s enac t m ent
. ” Landgraf , 511 U

. S. at269 ( ci t at ion om i t t ed)

. “R ather , the s t atut e’ s t empora l r eac h becomes unacc ept abl e onl y w h en i t s r etr oact i ve appl i cat i on w oul d s i g n i f

i c a n t l yi mpa i rexi s t i ng r i ght s and ther ebydi s appoi nt l egi t i m at e expe ct at ions

. ” D i nnal lv. G onz al es , 421 F. 3d 247, 2 5 2 (3 d C ir . 2 0 0 5 ) ( c ita tio n o m itte d ).
In d e c id in g w h e th e r a s ta tu te h a s a re tr o a c tiv e e f f e c t, a c o u rt m u st d e ter m in e th e “ im p o rta n t e v e n t” to w h ich th e sta tu te a lle g e d ly at ta c h e s n e w le g a l c o n s e q u e n c e s . S e e A tki ns on , 479 F. 3d at230 ( s tat ing tha tt he def endant ’ s convi ct i on w as t he “im por t antevent ” t o w hi ch the fe der al s t atut e att ache d a new leg a l c o n se q u e n c e ). In th e p re se n t ca se , the im p o rta n t ev e n t is n o t t h e e x e c u t i o n o f

t h e NE C A g r e e me n ti n 1 9 8 2 , a s S E P TA as s er t s , buti s r athert he D ew ees e acci denti n 2004, aft erw hi ch A m t r ak had t he r i ghtt o i ndemni t yfr om SE PT A forthat acc i dent

. SE PT A di d not ow e A m t r ak anyi ndemni t yobl i gat i on for t he D ew ees e acc i dent unt i l i t occurr ed on O ct ober 28, 2004, and, t hus , SE PT A ’ s al l eged sove r ei gn i m m uni t y defe ns e di d not a r i s e u n t i l A m t r a k f i l e d i t s c r o s s - c l a i m f o ri n d e m n i t y. T he r e f o r e , t h e Re f

o r m Ac t , p a s s e d i n 1 9 9 7 , d i d n o t a t t ach a ny new “l egal dut i es ” t o event s at i s s ue her e, w hi ch t ook pl ace l ong28 aft eri tw as enac t ed. B eca us e A m t r ak’ s r i ghtt o i ndemni t yfor t he 2004 acc i dentdi d notacc rue unt i l 2004, and the R eform A ct w a s p a ss e d se v e n y e a rs b e f o re , S E P T A ’s a rg u m e n t th a t th e re is im p e rm iss ib le r e tro a c tiv itylac k s m e rit.
M o reo v er, SE P T A h ad “f air n o ti ce ” o f the R ef

o rm A ct’s eff ect s w el l befor e A m tr ak fi r s ti nvoked i t s contr actual i ndemni t yr i ghti n 2004 and s o has no b asis fo rcl ai m i ng “re aso n ab le reli an ce ” o n it s so v ere ign im m u n ityd e f e n s e . See A tki ns on , 47 9 F. 3d at23 1 (st at i ng t hat i n retroact i vityanaly si s, “a c our tcan cert ai nl ybe gui ded bycons i der at i ons of fa i rnot i ce, re a so n a b le r e lian c e , an d se ttl e d e x p e c tatio n s” ) (e m p h a sis om i t t ed)

. B etw een 1997, w hen the R eform A ctw as pas s ed s peci fy i ng thatal l of A m t r ak’ s i ndemni t ycontr act s w oul d be uphel d , and 2004, w hen the ac ci dentoccurr ed, SE PT A had a m p le tim e to se e k ter m in a tio n o f th e N E C A g re e m e n t o r to r e n e g o t i a t e i t s i n d e mn i t yo b l i g a t i o n s , i f i t wi s h e d t o l i mi tt h e m. I I I . C oncl usi on S ec ti o n 2 8 1 0 3 (b) o f the R ef o rm A ct reflec ts C o n g ress’s unequi vocal s uppor tfor i ndemni t y agr eement s s uch as the ones b e tw e e n A m tra k a n d S E P T A . T h e p lain m e a n in g o f th e sta tu te i s confi r m ed byl egi s l at i ve hi s t ory , w hi ch s peci fi cal l ynot es C ongr es s ’ s i nt ent t o el i m i nat e “the pos s i bi l i t y t hat s t at e l aw s can nul l i fy[A m t r ak’ s ] i ndemni fi cat i on contr act s . ” S e n a te R e p o rt at 1 4

. B ec au se S E P T A ca n n o t b e all o w ed to u se P en n sy lvan ia’s so v ere ign im m u n itystatu te t o fru str ate the g o als o f th e R ef o rm A c t, w e w ill a f

f irm th e ju d g m e n t o f

th e D istric t C o u rt.