The Supreme Court Case All About Buses

Varun Mekala

January 2026

Have you ever wondered if a bus is a “sovereign being”. No? Yeah, me neither, but the Supreme Court is finally giving us an answer to this riveting question.

On January 14th, 2026, the court heard oral arguments for two cases that were consolidated together: Galette v. NJ Transit Corp. and NJ Transit Corp. v. Colt. At a glance, it seems this case is about traffic accidents. But under the hood, it’s about a twisted question that could affect American law for generations. The question is: When does a state-created corporation get to wrap itself in the "sovereign immunity" flag and walk away from a lawsuit?

The drama started with two tragedies. Cedric Galette was sitting in a car in Philadelphia when an NJ Transit vehicle slammed into him. He sued in Pennsylvania. Jeffrey Colt was struck by an NJ Transit bus in a Manhattan crosswalk, resulting in permanent injuries. He sued in New York. NJ Transit’s response to both of these lawsuits was simple, “You can’t sue us. We are not a transit company; we are the state of New Jersey. And we have sovereign immunity. So you can’t sue us in another state’s court without our permission.”

This is where things get messy. The highest court of Pennsylvania and New York decided two completely different things. To make it simpler I’ll create a nice table.

Court	Pennsylvania Supreme Court	New York Court of Appeals
The Verdict	Immune: NJ Transit is an “arm of the State”	Not Immune: NJ Transit is a public corporation.
The Reasoning	Focused on New Jersey’s own laws, which call NJ Transit an "instrumentality" of the state.	Focused on the "treasury factor". New Jersey isn't legally on the hook for NJ Transit's debts.
The Vibe	Protect the sister state’s sovereignty.	Protecting its own citizens' right to sue for injuries.

Hope you enjoyed my simple table because here is where things get complicated. To figure out if an entity is an “arm of state”, courts look at 3 factors:

• Control: Does the Governor appoint the board? (In this case, yes)

•  Function: Is it doing "government work" like police/fire, or "business work" like running a train?

• The Wallet: If NJ Transit loses a $10 million lawsuit, does the money come from a private insurance pot or does the New Jersey State Treasurer have to write a check?

  
  

During oral arguments this week judges seemed skeptical.Justice Ketanji Brown Jackson and others pointed out that when the Founders wrote the Constitution, "corporations" were generally seen as separate from the sovereign. NJ Transit’s lawyer argued that they are funded by the state to the tune of hundreds of millions of dollars a year. But the plaintiffs’ lawyers hit back: just because the state chooses to help pay the bills doesn't mean the state is legally liable for the lawsuits.

If the Supreme Court rules that NJ Transit is an "arm of the state," it could make it incredibly difficult for anyone injured by a state-affiliated agency to get justice if the accident happens across state lines. If they rule for Galette and Colt, they’ll be sending a clear message: If you want to run a business like a corporation, you have to face the music like a corporation.