Thacker v. Tennesse Valley Authority

Justia Summary

The Tennessee Valley Authority (TVA), a government-owned corporation that provides electric power to millions of Americans, may “sue and be sued" in its corporate name; 16 U.S.C. 831c(b), waives some of the sovereign immunity from suit that it would have enjoyed as a federal government entity. The Federal Torts Claims Act subsequently waived immunity from tort suits involving federal agencies, except for claims based on a federal employee’s performance of a “discretionary function,” 28 U.S.C. 2680(a). Congress specifically excluded from the FTCA—including the discretionary function exception—claims arising from TVA activities. TVA employees were raising a downed power line that was partially submerged in the Tennessee River when Thacker drove his boat into the area at high speed and collided with the power line, seriously injuring him and killing his passenger. The Eleventh Circuit affirmed the dismissal of the suit.

The Supreme Court unanimously reversed and remanded. TVA’s sue-and-be-sued clause is not subject to a discretionary function exception and Congress made a considered decision not to apply the FTCA to the TVA. The Court declined “to negate that legislative choice.” An “implied restriction” is appropriate only where the suit at issue is “not consistent with the statutory or constitutional scheme” or the restriction is “necessary to avoid grave interference with the performance of a governmental function.” The discretionary acts of hybrid entities like the TVA may be commercial in nature, and a suit challenging a commercial act will not interfere with governmental functions. To determine whether the TVA has immunity, the court on remand must decide whether the allegedly-negligent conduct is governmental or commercial in nature, and, if governmental, decide whether prohibiting this type of suit is necessary to avoid grave interference with the governmental function’s performance.