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DORIS TRADING CORP. v. SS UNION ENTERPRISE

January 23, 1976

DORIS TRADING CORPORATION, Plaintiff,
v.
The SS UNION ENTERPRISE, her engines, boilers, etc., et al., Defendants


MacMahon, District Judge.


The opinion of the court was delivered by: MACMAHON

MacMAHON, District Judge.

Defendant, South Carolina State Ports Authority ("Authority"), moves for an order, pursuant to Rule 12(b), Fed.R.Civ.P., dismissing the claim against it in this action on three grounds:

 (1) the Authority is immune from suit in this court under the Eleventh Amendment;

 (2) the court lacks subject matter jurisdiction; and

 (3) service of process was defective.

 Plaintiff, Doris Trading Corporation, commenced this action by filing a complaint on August 11, 1975, alleging that this is a maritime claim within the meaning of Rule 9(h), Fed.R.Civ.P.

 Plaintiff claims that the shipper, Samuel & Co., Inc., on or about July 3, 1974 delivered 172 bales of cotton sheeting, in good order, to the SS Union Enterprise (which was owned by, or under the control of, defendant China Union Lines), in Keeling, Taiwan, to be transported to the port of Charleston, South Carolina. The cotton was identified by a bill of lading numbered TCT-24. The SS Union Enterprise arrived in Charleston on or about August 16, 1974. The cotton was delivered to plaintiff, allegedly in a damaged condition, on or about August 22, 1974 by defendant Authority. Plaintiff now seeks to recover $101,605.81 in damages.

 1. The Eleventh Amendment.

 The Eleventh Amendment to the Constitution provides:

 
"The Judicial power of the United States shall not be construed to extend to any suit in law or in equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State."

 The Authority contends that it is an instrumentality of the State of South Carolina and is, therefore, immune under the Eleventh Amendment. Furthermore, the Authority asserts that it has done nothing to waive immunity. Plaintiff contends that this action is not against the State of South Carolina but against a distinct business organization which is not protected by the Eleventh Amendment, or, if it is, that Authority has waived its immunity.

 Our first inquiry is addressed to whether the Authority partakes of the Eleventh Amendment immunity of the State of South Carolina. This is a question of federal law, *fn1" and the nature of the claim asserted has no bearing on its resolution. It is only after an affirmative answer to this question that the issue of waiver must be determined.

 The test to be applied is whether the Authority is an "alter ego" of the state. *fn2" The answer depends upon whether the state is the "real substantial party in interest." *fn3" This, in turn, depends upon whether the relief sought is relief against the state, *fn4" and here, the crucial factor to consider is the fiscal relationship between the Authority and the state.

 The only case we have found dealing with this problem is South Carolina Ports Authority v. Seaboard Air Line R. R., 124 F. Supp. 533 (E.D.S.C.1954), where it was held that the Authority was "'in a real sense a part of the State, and shares in its sovereignty.'" *fn5" However, there the court rested its decision upon the governmental nature of the activities performed by the Authority and did not inquire into the relationship between the Authority and the state. If the Authority is not an "alter ego" of the state, the fact that it is performing governmental functions has no bearing upon the question of whether it is cloaked by the Eleventh Amendment, *fn6" for "the ...


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