Plaintiffs-appellants appeal from an order entered on August 19, 1996 in the United States District Court for the Northern District of New York (McAvoy, J.) dismissing plaintiffs-appellants’ claims for lack of subject matter jurisdiction pursuant to Fed. R.Civ.P. 12(b)(1).
Today, we join our sister circuits in considering: (1) whether after the Supreme Court’s decision in Seminole, Congress may abrogate the States’ Eleventh Amendment sovereign immunity under the Interstate Commerce Clause; and (2) whether States waive their sovereign immunity by acting outside the sphere of state sovereignty. We find the answer to both is negative and, accordingly, affirm the district court, dismissing this action for lack of subject matter jurisdiction.
BACKGROUND
Plaintiffs-appellants are 404 employees (the “Employees”) of defendant-appellee State of New York (“New York” or the “State”) who allege that the State failed to pay overtime compensation in violation of the Fair Labor Standards Act (the “FLSA”). 29 U.S.C. §§ 201-219 (1978).
In July 1994, the Employees commenced this action seeking recovery of unpaid overtime compensation, liquidated damages, and reasonable attorneys’ fees from New York pursuant to the FLSA. 29 U.S.C. § 216(b). In February 1996, the Employees moved for partial summary judgment on the issue of liability and New York cross-moved for summary judgment in full, contending, inter alia, that the Eleventh Amendment guarantee of
The district court initially denied the State’s cross-motion for sovereign immunity, holding that the State of New York violated the FLSA and is liable for overtime compensation to certain “qualifying” plaintiffs. See Close v. New York, No. 94-CV-0906,
However, in March 1996, while this case was pending, the Supreme Court issued its decision in Seminole Tribe v. Florida,
The district court soundly rejected the Employees’ arguments and noted that Seminole “appears to stand for the proposition that the only way Congress can abrogate [Spates’ immunity is if the federal statute in question is passed pursuant to the Fourteenth Amendment — -the only remaining recognized authority for such Congressional action.” Close v. New York, No. 94-CV-0906,
it is because Seminole Tribe eliminated the Interstate Commerce Clause, and not just the Indian Commerce Clause, as authority for Congressional abrogation of [S]tates’ immunity that the Supreme Court took the step of overruling Pennsylvania v. Union Gas Co.,491 U.S. 1 ,109 S.Ct. 2273 ,105 L.Ed.2d 1 (1989).
Close II,
In rejecting the constructive waiver argument, the district court found that the Employees relied on an “incredibly broad” definition of activities outside the sphere of state sovereignty — one that would encompass any “activity, that [the State] does not control to the total exclusion of the federal government.” Id. at *4. Noting that a state’s participation in an activity regulated at least in part by the federal government is not, standing alone, sufficient to establish consent to be sued in federal courts, the district court held that the State did not constructively waive its Eleventh Amendment immunity by hiring and paying state employees under the FLSA Id.
On August 19, 1996, the district court granted the State’s motion and dismissed the action for lack of subject matter jurisdiction.
DISCUSSION
On appeal, the Employees contend that the decision in Seminole does not divest this Court of jurisdiction and that Reich remains the controlling precedent in this Circuit. Specifically, they maintain that even after Seminole, Congress retains the power to abrogate the States’ Eleventh Amendment sovereign immunity under the FLSA. Alternatively, the Employees argue that New York constructively waived its Eleventh Amendment sovereign immunity. We disagree.
Standard of Review
When reviewing a district court’s determination of subject matter jurisdiction pursuant to Fed.R.Civ.P. 12(b)(1), we review factual findings for clear error and legal conclusions de novo. See Wake v. United States,
Eleventh Amendment Immunity
The Eleventh Amendment provides:
[t]he Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State.
U.S. Const, amend. XI. In addition, the Eleventh Amendment also implicitly protects an unconsenting state from suit by its own citizens. See Edelman v. Jordan,
Eleventh Amendment immunity, however, is not absolute. When, as here, plaintiffs seek recovery only from the state, and not from its officials, there are two ways to divest a state of its Eleventh Amendment sovereign immunity and hale the state into federal court: (1) Congress may abrogate a state’s sovereign immunity through a statutory enactment, see Fitzpatrick v. Bitzer,
Abrogation
Congress may not abrogate a state’s sovereign immunity unless it: (1) “unequivocally expressed] its intent to abrogate the immunity”; and (2) acts “pursuant to a valid exercise of power.” Seminole, at-,
[a]n action to recover the liability prescribed [unpaid minimum wages, unpaid overtime compensation, an additional equal amount as liquidated damages, employment, reinstatement, promotion, payment of wages lost, etc.] ... may be maintained against any employer (including a public agency) in any Federal or State court of competent jurisdiction by any one or more employees for and in behalf of himself or themselves and other employees similarly situated.
29 U.S.C. § 216(b) (emphasis added). We find, however, that the FLSA fails to satisfy the second prong in light of Seminole.
A) The Seminole Decision
In Seminole, the Seminole Tribe sued Florida in federal court under the Indian Gaming Regulatory Act (“IGRA”)
As the Fourteenth Amendment played no part in the Seminole decision, the Court focused on the Interstate Commerce Clause. The Court noted that “[i]f anything, the Indian Commerce Clause accomplishes a greater transfer of power from the States to the Federal Government than does the Interstate Commerce Clause,” Seminole, at-,
A plurality of the Court in Union Gas believed that “the States surrendered a portion of their sovereignty when they granted Congress the power to regulate commerce,”
[t]he States held liable under such a congressional enactment are thus not “unconsenting”; they gave their consent all at once, in ratifying the Constitution containing the Commerce Clause, rather than on a case-by-ease basis.
Id. at 20,
Seminole put an end to such seemingly unbridled congressional power concluding that Union Gas departed from established federalism jurisprudence in that it expanded the jurisdiction of the federal courts beyond the bounds of Article III. See Seminole, at -,
The Supreme Court explicitly overruled Union Gas and, by necessity, rejected claims with respect to the IGRA and found that the Seminole Tribe’s suit against Florida was barred by the Eleventh Amendment. See Seminole, at-,
the background principle of state sovereign immunity ... is not so ephemeral as to dissipate when the subject of the suit is an area ... that is under the exclusive control of the Federal Government. Even when the Constitution vests in Congress complete law-making authority over a particular area, the Eleventh Amendment prevents congressional authorization of suits by private parties against unconsenting States. The Eleventh Amendment restricts the judicial power under Article III, and Article I cannot be used to circumvent the constitutional limitations placed upon federal jurisdiction.
Id at-,
By overruling Union Gas, the Supreme Court restored the balance of power between Congress and the Judiciary anticipated by the Framers in Article I and Article III of the Constitution and delineated the only permissible area of convergence: Congress may abrogate the States’ Eleventh Amendment sovereign immunity by the power vested to it
B) The Reich Decision
A scant three years before Seminole, we held that the FLSA, enacted pursuant to Congress’s powers under the Interstate Commerce Clause, abrogated the States’ Eleventh Amendment sovereign immunity. See Reich,
The Employees now urge this Court to follow Reich, not Seminole, in adjudicating congressional abrogation under the FLSA. They maintain, as did the plaintiffs in Union Gas and Reich, that Congress has the power to abrogate the States’ Eleventh Amendment sovereign immunity under the Interstate Commerce Clause. However, the Supreme Court, in Seminole, explicitly rejected this argument when it overruled Union Gas and we are bound by Seminole.
C) Seminole Is The Controlling Precedent
Generally, “[w]hen an opinion issues for the Court, it is not only the result but also those portions of the opinion necessary to that result by which we are bound.” Seminole, at-,
A decision of a panel of this Court is binding until it is overruled by the Court en banc or by the Supreme Court. See Jones v. Coughlin,
Today, we join the long list of courts
Waiver
“The test for determining whether a State has waived its immunity from federal-court jurisdiction is a stringent one.” Atascadero,
The doctrine of constructive consent is not “commonly associated with the surrender of constitutional rights” Edelman,
As just discussed, it is undisputed that in enacting the FLSA Congress clearly intended to hold the States liable in federal court; and the Employees contend that because the State acted outside the sphere of state sovereignty [by being an employer], it consented to be sued in federal court. They point out that because Congress did not violate the Tenth Amendment when it made the FLSA applicable to the States, see Garcia v. San Antonio Metro. Transit Auth.,
While both Amendments protect the States, they deal with different aspects of state sovereignty. The Tenth Amendment protects States from intrusion by the federal government.
The Eleventh Amendment protects States from suits by its citizens in federal court. It is concerned with judicial authority and limits the power of Article III courts over actions brought against States. See Reich,
The Employees rely on Parden v. Terminal Ry. of Alabama State Docks Dep’t,
Recognition of the congressional power to render a State suable under the FELA does not mean that the immunity doctrine, as embodied in the Eleventh Amendment ... is here being overridden. It remains the law that a State may not be sued by an individual tvithout its consent.
Id. at 192,
The Parden court found such consent, holding that Alabama acted outside its sphere of sovereignty and consented to suit in federal court, when it began operating an interstate railroad twenty years after the enactment of FELA.
First, Congress may exercise power over the States without affecting Eleventh Amendment immunity. See Seminole, at -n. 14,
Second, the very premise that a congressional exercise of power permissible under the Tenth Amendment would negate the Eleventh Amendment is untenable. Such reasoning would offer Eleventh Amendment protection only for those activities exclusively regulated by the States. Moreover, if we were to recognize constructive consent every time a State acted in a field regulated by Congress, we would vitiate the very premise upon which Seminole was decided.
At bottom, then, to acknowledge that the Federal Government can make the waiver of state sovereign immunity a condition to the State’s action in a field that Congress has authority to regulate is substantially the same as acknowledging that the Federal Government can eliminate state sovereign immunity in the exercise of its Article I powers — that is, to adopt the very principle I have just rejected____ If state sovereign immunity has any reality, it must mean more than this.
Union Gas,
Third, the Employees’ constructive consent argument and reliance on Parden is not only inconsistent with the holding in Seminole, but is inapplicable with respect to the FLSA. In Parden, Alabama could be deemed to waive immunity because it began operating a railroad 20 years after the enactment of FELA. In this case, however, the FLSA deals with employee rights, not economic endeavors. Moreover, given that New York had employees before the enactment of the FLSA and before it was made applicable to the States,
Finally, Parden’s viability, in light of Seminole is' precarious. If Congress no longer
CONCLUSION
Based on the foregoing, we affirm the judgment of the district court.
Notes
. IGRA describes the process by which a state and an Indian tribe undertake negotiations towards a Tribal-State Compact governing the operation of gaming by the tribe.
. See Aaron v. Kansas,
. "The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.” U.S. Const. amend. X.
. In 1987, the Supreme Court explicitly overruled Parden to the extent that it "is inconsistent with the requirement that an abrogation of Eleventh Amendment immunity by Congress must be expressed in unmistakably clear language.” Welch v. Texas Dep’t of Highways & Pub. Transp.,
. The FLSA was enacted in 1938 and made applicable to the States in 1966. See Garcia v. San Antonio Metro. Transit Auth.,
