Sovereign immunity belongs to the government alone.

In a unanimous decision with farreaching implications for accountability, the Supreme Court held that private companies cannot evade the law simply because they contract with the federal government. 

In The GEO Group, Inc. v. Menocal, the Court rejected GEO Group’s attempt to shortcircuit litigation brought by detainees who alleged that the company subjected them to forced labor while operating a private immigration detention facility under contract with U.S. Immigration and Customs Enforcement. The decision marks Gupta Wessler Principal Jennifer Bennett’s fourth unanimous Supreme Court victory and sends a clear signal that outsourcing government functions does not outsource legal responsibility. 

GEO Group operates an immigration detention facility in Aurora, Colorado. Former detainee Alejandro Menocal filed a class action alleging that GEO required detainees to perform unpaid labor under threat of punishment, including solitary confinement, and paid others just $1 per day for essential work. The complaint alleged violations of a federal bar on forced labor as well as Colorado’s prohibition on unjust enrichment. 

GEO did not dispute that it created and implemented the labor policies. Instead, it argued that it could not be sued at all. Relying on a doctrine derived from the Supreme Court’s 1940 decision in Yearsley v. W.A. Ross Construction Co., GEO claimed that because it operated under a federal contract, it enjoyed a form of “derivative sovereign immunity.” 

Lower courts rejected that argument, finding that GEO’s contract did not authorize the challenged labor practices. GEO nevertheless sought an immediate appeal, arguing that the denial of Yearsley protection was effectively a denial of immunity from suit. The Supreme Court unanimously disagreed. 

Yearsley Does Not Shield Unlawful Conduct 

Writing for the Court, Justice Kagan explained that Yearsley does not provide immunity from suit. Instead, it offers a defense to liability—one that applies only when a contractor has acted lawfully within the scope of valid government authorization. 

Crucially for the forcedlabor claims at issue, the Court made clear that the doctrine offers no protection when a contractor may have violated the law: 

“Yearsley’s protection runs out when the contractor may have violated the law—when the contractor either acted under an illegal authorization or exceeded the scope of a legal one.” 

Because Yearsley applies only to lawful conduct, it cannot function as an immunity, which by definition shields defendants regardless of whether their conduct was legal. As Justice Kagan put it: “Yearsley thus ensures that it will never shield unlawful conduct, in the way that all immunities do.” 

That distinction mattered procedurally. True immunities protect defendants from the burdens of litigation itself and are immediately appealable when denied. A merits defense, by contrast, can be fully reviewed after trial. Because Yearsley falls into the latter category, GEO had no right to an interlocutory appeal. 

A Blunt Rejection of “Derivative Sovereign Immunity” 

The Court also squarely rejected GEO’s broader claim that government contractors inherit the government’s sovereign immunity. Longstanding precedent, the Court explained, draws a sharp line between the government and the private entities it hires. 

That principle was summed up by Justice Kagan in a sentence that will likely be quoted for years to come: 

“Sovereign immunity belongs alone to the Government.” 

The message is unmistakable. Private companies that perform government work—whether operating detention facilities or carrying out other public functions—remain subject to the law when they exceed their authority or violate statutory and constitutional protections. 

Why the Decision Matters 

The Court’s ruling ensures that allegations of forced labor by private detention operators must be heard on the merits, rather than dismissed through expansive immunity theories. It prevents contractors from using procedural doctrines to delay or derail accountability and reinforces the principle that legal obligations do not disappear at the boundary between public and private power. 

As governments increasingly rely on private actors to perform core functions, the decision draws a clear line: contracting with the government is not a license to break the law.