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New Jersey sees Supreme Court exit ramp from mob-fighting commission

The justices appeared skeptical that New York could force New Jersey to stay in an agreement that the state wants out of. 

WASHINGTON (CN) — New Jersey made gains Wednesday at the Supreme Court in its yearslong fight to leave the Waterfront Commission of New York Harbor. 

Though cautious about creating a broad precedent that would allow states to unilaterally leave interstate compacts, the justices appeared to think precedent and federal law governed New Jersey’s exit from the joint commission with New York.

“One party can’t keep the other on the hook forever,” Justice Sonia Sotomayor said. 

New York Deputy Solicitor General Judith Vale pointed to the lack of a termination agreement to mean neither state can leave without the other's consent. Vale said the commission required joint agreement for everything, so termination should not get a free pass. 

The justices did not buy this argument. Justice Clarence Thomas questioned if the states’ sacrificed their sovereignty permanently because they failed to note termination terms when creating the compact. Justice Ketanji Brown Jackson noted evidence that the commission did not state termination terms because of signals it could send to criminal enterprises about the commission’s status. Jackson said this evidence undermined New York’s argument that the states intended the compact to be permanent. 

Noting the breadth of the port authority, Chief Justice John Roberts said the commission was just one important but small enterprise within a larger system. 

While New York claimed there were other solutions to resolving the dispute that New Jersey had not attempted, Justice Elena Kagan called it indicative of the states' ability to resolve their differences that they are before the court now. 

“Most of the time parties don’t get to this court if they’re not at an impasse,” the Obama appointee said. 

New Jersey's state police force is prepared to take up the responsibilities delegated to the commission, according to a statement after oral arguments on Wednesday.

“We believe New Jersey’s actions are consistent with our sovereign rights and centuries of case law,” the state’s attorney general’s office said. “The port must be safe, secure, and operated fairly, and the State Police is well prepared to take on that responsibility. We look forward to a decision from the Court this spring.”

The Garden and Empire states came together 70 years ago to create a regulatory agency with police power aimed at stamping out crime and corruption. Earning the ire of mobsters and crooked officials it targeted, the commission was successful and featured on the silver screen through the Oscar-winning film “On the Waterfront.” 

In the early 21st century, however, the commission’s early successes waned. A 2009 audit uncovered lawlessness within the commission mirroring the crime it was created to stamp out. The report triggered a restructuring of the agency focusing on hiring diversity efforts to root out corruption from within. 

“The absolute control of the union over hiring in the Port for the past 60 years has resulted not only in discriminatory hiring, but also corruption, criminality and inefficiency,” a commission report from 2017 details. “For far too long, well-deserving residents of the Port’s surrounding communities have been systematically denied the opportunity to work on the waterfront. Meanwhile, those who are connected to union leadership or organized crime figures are rewarded with high paying, low-show or no-work special compensation packages.” 

The commission’s hiring efforts were met with pushback. The International Longshoremen’s Association, New York Shipping Association and Metropolitan Marine Maintenance Contractors Association sued to halt the hiring practice overhaul. Rejecting the unions’ claims that the commission had overstepped its authority and interfered with collective bargaining rights, the Third Circuit ruled in favor of the commission in 2016. 

Two years later, the New Jersey Legislature passed a statute to unilaterally leave the commission. A court battle prevented the law from taking effect but the state’s acting governor re-upped the effort in 2021. In a last-ditch effort to prevent New Jersey from withdrawing, New York brought a bill of complaint to the Supreme Court. After granting temporary relief halting New Jersey’s actions, the Supreme Court agreed to hear arguments over whether the compact allows one state to unilaterally withdraw.  

New Jersey Solicitor General Jeremy Feigenbaum attributed the commission's overregulation of business practices as the reason for the Garden State’s withdrawal. 

The justices embraced New Jersey’s arguments but are aware of the broader implications their ruling could have on other interstate compacts governing issues like water rights. 

Participating in oral arguments as amicus curiae, the U.S. government told the justices it should rule in favor of New Jersey. Austin Rayor, assistant to the solicitor general at the Justice Department, said the justices would not have to create a broad ruling in the case impacting sovereignty because contract principles would allow New Jersey’s unilateral withdrawal. 

Categories: Appeals Government Law Regional

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