In Stewart v. State of North Carolina, the Fourth Circuit in an opinion by Chief Judge Wilkins, joined by Judges Luttig and Gregory, held that the State of North Carolina did not waive its state law sovereign immunity defense to state law claims by removing a case that joined state and federal law claims to federal court.
Chief Judge Wilkins concluded that the district court had erred in extending the Supreme Court's decision in Lapides v. Board of Regents, 535 U.S. 603 (2002), dealing solely with the Eleventh Amendment, to the issue of whether removal meant some kind of waiver or abandonment of the state law immunity where there was no consent to state court jurisdiction for such a claim:
"Lapides addresses whether a state that removes an action to federal court having already consented to suit in its own courts can invoke Eleventh Amendment immunity; it does not resolve whether a state that has not consented to suit in its own courts maintains either the broader concept of sovereign immunity or Eleventh Amendment immunity upon voluntarily removing a case to federal
The Court noted:
"Unlike Georgia in Lapides, North Carolina had not consented to suit in its own courts for the relevant claims asserted by Stewart."
The Court concluded:
"North Carolina chose to employ the removal device to have the issue of sovereign immunity resolved in a federal, rather than a state, forum. We see nothing inconsistent, anomalous, or unfair about permitting North Carolina to employ removal in the same manner as any other defendant facing federal claims. We therefore hold that North Carolina, having not already consented to suit in its own courts, did not waive sovereign immunity by voluntarily removing the action to federal court for resolution of the immunity question."
All Deliberate Speed has this post about the decision.