SCOTUS Pressed on Whether Government Contractors Can Immediately Appeal Immunity Denials

The case arises from a class action brought by immigration detainees against The GEO Group, Inc., which operates the Aurora Immigration Processing Center in Colorado under contract with U.S. Immigration and Customs Enforcement. Detainees alleged GEO forced them to clean common areas under threat of solitary confinement and paid them $1.00 per day for voluntary work, violating the Trafficking Victims Protection Act and Colorado common law.

GEO sought summary judgment based on derivative sovereign immunity under Yearsley v. W.A. Ross Construction Co., arguing it was merely following government direction. The district court denied the motion, finding ICE did not direct the labor practices. The Tenth Circuit dismissed GEO’s appeal for lack of jurisdiction, holding the order was not immediately appealable under the collateral-order doctrine.

At argument, the justices questioned whether Yearsley provides an immunity from suit or merely a defense to liability, a distinction that determines whether the collateral-order doctrine applies.

Justice Sonia Sotomayor challenged GEO’s characterization of the doctrine as an immunity. "Yearsley was never an immunity case not because it was after trial but because the issue in Yearsley was who was responsible for the taking," Sotomayor said. "The fact that we've inartfully called it an immunity, it's really a question of relief from liability."

Justice Elena Kagan pressed GEO counsel on whether satisfying Yearsley criteria means the contractor did nothing wrong or simply is protected from consequences despite wrongdoing. "In other words, when somebody says, look, I did only what the government authorized by way of a lawful authorization, what I'm really saying is so how could I have done anything wrong," Kagan said.

GEO argued that contractors following government instructions are immune from suit for the same reason government employees are immune, citing the common law tradition that draws no distinction between public servants and private individuals engaged in public service.

Justice Samuel Alito asked why the rule should not be the same for GEO as it is for government officials. "ICE and the officials could raise sovereign immunity, they could raise qualified immunity and Westfall Act immunity, and if the district court denied any of those, then they could get an interlocutory appeal," Alito said. "So why shouldn't the rule be the same for GEO?"

Respondent’s counsel Jennifer Bennett argued GEO fails to meet the requirements for a collateral order because Yearsley is not a right to avoid trial and involves fact-intensive questions intertwined with the merits. "Yearsley only applies when you're doing exactly what the government directed," Bennett said. "Yearsley isn't about saying, contractors, we want to you go out and take bold action regardless of whether you know it's lawful, regardless of whether you've been directed by the government."

The government, represented by Solicitor General’s office counsel Sopan Joshi, sided with the respondents, arguing Yearsley is a defense to liability rather than an immunity from suit. Joshi noted that contractors can price litigation costs into contracts through overhead or insurance, challenging GEO’s claim that they cannot absorb litigation risk.

Justice Amy Coney Barrett asked GEO whether it could negotiate for indemnification in its contracts. GEO counsel Dominic Draye responded that the Antideficiency Act and Federal Acquisition Regulations prevent open-ended indemnification and restrict pricing in litigation expenses. "And if we were to put them in as sort of, like, overhead or something, that would be a false claim and would expose us to suit under the False Claims Act," Draye said.

The Court also questioned whether the policy considerations justifying immediate appeals for qualified immunity apply to contractors. Justice Ketanji Brown Jackson noted that qualified immunity shields individual officers from undue interference, whereas Yearsley provides a blanket no-liability rule for contractors following instructions.

The case is The GEO Group, Inc. v. Menocal, No. 24-758.