Arbogast v Kansas Department of Labor

Arbogast sued Department under the Rehabilitation Act. Department moved to dismiss for lack of capacity to sue and 11th Amendment immunity. The district court denied the motion to dismiss. The panel dismissed in part and affirmed in part. It held that it lacked jurisdiction over the capacity issue because the district court did not actually decide the issue and thus there was neither a final judgment nor an appealable collateral order. The panela also held it lacked pendant jurisdiction as the capacity issue was not inextricably entwined with the immunity issue. The panel affirmed on the immunity issue holding that under 42 USC 2000d-7(d)(1), immunity is waived by the receipt of federal funds by any part of Department, Department received federal funds for its unemployment division and thus waived immunity for all its parts including the workers compensation group Arbogast worked at because the group is part of the Department under Kansas law as the Department’s leader actively administers both subunits. It finally held that 2000d-7(d)(1) is valid use of spending clause power as fighting discrimination is general welfare purpose, allowing suit reasonably calculated to advance that goal and distribution of funds comes with eh interest of eliminating discrimination attached.