The Port Authority of New York and New Jersey is pushing back against former executive William E. Baroni Jr., urging the Second Circuit not to greenlight another shot at $4 million in legal fees tied to the infamous “Bridgegate” scandal. Officials argue that a recent appellate ruling reviving Baroni’s claims threatens to upend long-standing principles of federalism.

Jurisdiction Clash Over State Immunity

In a petition filed Tuesday seeking panel and en banc rehearing, the Port Authority contended that a December appellate decision, which allowed Baroni to pursue indemnification for his overturned Bridgegate conviction, ignored decades of precedent surrounding state sovereign immunity. The agency said the panel’s ruling improperly minimized the role of immunity, effectively broadening federal court jurisdiction over state-law claims.

“Entities like the Port Authority that implement important government functions will be forced to defend on the merits in federal court cases under state law that would fail at the outset in state court,” the filing read.

The panel itself, through a “mini en banc procedure,” acknowledged that its decision diverged from Second Circuit precedent set in the 2011 case Caceres v. The Port Authority of New York & New Jersey, which held that state-law immunity limits federal courts’ subject-matter jurisdiction over state-law claims.

Precedent Under Siege

The Port Authority stressed that Caceres is not an anomaly. Several prior cases established that if a state court lacks jurisdiction to hear a claim under state law, federal courts also cannot adjudicate it. Invoking the landmark 1938 Supreme Court case Erie Railroad Co. v. Tompkins, the agency argued that federal courts must follow state law in state-law claims, preventing federal courts from entertaining suits barred in state court.

“The resulting confusion [from the panel opinion] would complicate litigation strategy, burden courts with threshold disputes over forum, and erode the predictability that Erie and its progeny were designed to protect,” the petition said.

Bridgegate Origins

The dispute traces back to 2016, when Baroni was convicted of conspiracy and fraud for his role in a political scheme that caused massive traffic jams in New Jersey. The U.S. Supreme Court overturned his conviction in May 2020, along with co-defendant Bridget Kelly’s.

Baroni filed suit in New York state court in 2021, claiming the Port Authority bylaws obligated the agency to cover his legal fees. After removal to federal court, the Port Authority successfully argued that Baroni’s claims were barred by state-law immunity. Yet a federal appellate panel later reversed that decision, allowing Baroni’s claims to proceed.

Legal Teams

Baroni is represented by Sidley Austin LLP partners Michael A. Levy, Christopher M. Egleson, Michael D. Mann, Danica L. Muir, Alyssa M. Hasbrouck, Norman M. Hobbie Jr., and James R. Horner. The Port Authority is represented by WilmerHale attorneys John He, Peter G. Neiman, Anjan S. Sahni, and Alan Schoenfeld.

Baroni declined comment through counsel Wednesday, and the Port Authority’s attorneys did not immediately respond to requests for comment.

The Port Authority $4M Bridgegate suit is now poised to test the boundaries of federal jurisdiction and state sovereign immunity in a high-stakes legal showdown.