Eleventh Amendment and Limitation of Liability

The U.S. Court of Appeals for the Tenth Circuit ruled that the Eleventh Amendment to the U.S. Constitution does not prevent a ship owner from pursuing a limitation of liability claim where one of the claimants is a state.

In the instant case, the State of Oklahoma brought suit in state court against the owner of a tugboat that allided with a highway bridge, resulting in severe damage to the bridge and the deaths of various persons. Defendant tugboat owner removed the case to federal court. The state contended that, under the Eleventh Amendment, a state cannot be prohibited from pursuing its claim in state court and cannot be forced to pursue its claim in federal court. The federal appellate court held that the Eleventh Amendment is a shield, not a sword. It prevents claimants from suing states in federal court.

It does not apply when, as here, it is the state that commenced the action. Magnolia Marine Transport Co. v. State of Oklahoma, No. 03-7023 (10th Cir.) (HK Law)