Wednesday, June 27, 2007
Howard Bashman in a June 25, 2007 law.com article entitled "How Binding Is a Federal Appellate Court's Prediction of State Law?" addresses an important issue that remains unresolved almost 80 years after Erie Railroad Co. v. Tompkins (1938). We know that where there is no state court definitive legal answer, a federal court, sitting in diversity, will predict how the state court of last resort will rule. What remains unresolved is how much weight should that federal court decision be given by later federal courts.
The article also discusses a June 18, 2007 Third Circuit case, Worowski v. Ciasulli, ___F.3d___ (3d Cir. 2007) where this important issues was raised. As Mr. Bashman states:
[The Third Circuit] renounced an Erie prediction of New Jersey law from 1988 in favor of an opposite prediction even though the Supreme Court of New Jersey has yet to directly confront the particular question of state law at issue.
Ordinarily, three-judge panels of the 3rd Circuit view themselves as powerless to overrule one another, unless the legal question at issue has been definitively resolved by a higher court: the U.S. Supreme Court on issues of federal law, or a state court of last resort on issues of state law. In the absence of a definitive ruling to the contrary from a higher court, only the 3rd Circuit sitting en banc can overrule a three-judge panel's decision. Nevertheless, in last week's 3rd Circuit ruling, a three-judge panel considered itself authorized to overrule the Erie prediction of an earlier three-judge panel from 1988 based on intervening intermediate appellate court rulings from the New Jersey judicial system.
Civil Procedure buffs take note. This is an important development to watch.
Mitchell H. Rubinstein