2012 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

12-21-2012

Timothy Defoe v. Lenroy Phillip

Precedential or Non-Precedential: Precedential

Docket No. 12-1586

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 1

PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

____________

No. 12-1586

_____________

TIMOTHY DEFOE

v.

LENROY PHILLIP,

Petitioner

______________

On Writ of Certiorari to the Supreme Court

of the Virgin Islands

Supreme Court No. VISC-1: 2009-0007

Argued December 4, 2012

Before: SMITH, HARDIMAN, and ROTH, 

Circuit Judges

(Filed: December 21, 2012)
2

Joel H. Holt [ARGUED]

Law Offices of Joel H. Holt

2132 Company Street, Suite 2

Christiansted, VI 00820

Counsel for Respondent

Carl A. Beckstedt, III [ARGUED]

Beckstedt & Associates

Suite 2

5025 Anchor Way

Christiansted, VI 00820

Douglas L. Capdeville

Law Offices of Douglas L. Capdeville

2107 Company Street, Lot#4

P.O. Box 224191

Christiansted, VI 00822

Counsel for Petitioner

________________

OPINION

________________

SMITH, Circuit Judge.

For over half a century, this Court has been the 

final interpreter of Virgin Islands law. In that role, we 
3

have made an incalculable number of rulings and have 

issued hundreds of decisions. But our role changed in 

2007 with the founding of the Supreme Court of the 

Virgin Islands. We must now decide whether and when 

that nascent Supreme Court may reject our pre-2007 

interpretations of Virgin Islands law.

1

I

Lenroy Phillip and Timothy Defoe worked 

together at an oil refinery in the United States Virgin 

Islands. On October 27, 2007, Phillip was driving a 

company-owned vehicle near the refinery when it struck 

Defoe. Phillip received a citation from their employer for 

inattentive driving. 

While recovering from his injuries, Defoe filed a 

claim and received benefits under the Virgin Islands 

Workers’ Compensation Act, 24 V.I. Code § 250 et seq.

He also sued Phillip for negligence in the Superior Court 

of the Virgin Islands. The Superior Court granted 

 1 Pursuant to its congressionally granted authority, 

the Virgin Islands legislature created the Supreme Court 

of the Virgin Islands in 2004, see 4 V.I. Code § 2, but the 

Supreme Court did not begin to exercise its judicial 

authority until January 29, 2007. For convenience, we 

refer to decisions from before the time it began 

exercising its authority as pre-2007 decisions. 
4

summary judgment for Phillip. It relied on our decision 

in Tavarez v. Klingensmith, 372 F.3d 188 (3d Cir. 2004), 

in which we held that the Workers’ Compensation Act 

prevents injured employees from suing their coworkers.

Id. at 192 (citing 24 V.I. Code § 284). The Superior 

Court therefore rejected Defoe’s negligence claim.

Defoe appealed to the Supreme Court of the Virgin 

Islands. The Supreme Court reversed, concluding that the 

Act’s immunity provision does not prevent suits against 

coworkers. Defoe v. Phillip, No. 2009-0007, 2012 WL 

37404, at *2 (V.I. Jan. 5, 2012) (per curiam). Before 

reaching that conclusion, the Supreme Court declared

that it was no longer bound by this Court’s pre-2007 

decisions on Virgin Islands law—even while 

acknowledging that the Superior Court remains bound by 

those decisions until the Supreme Court says otherwise. 

Id. at *3–4; see also People v. Murell, No. 2011-0074, 

2012 WL 2308543, at *6 (V.I. May 15, 2012) (stating

that the Supreme Court need not follow two of our 

precedents on questions of local law). The Supreme 

Court then rejected our holding in Tavarez and remanded 

to the Superior Court to determine whether Phillip 

actually was negligent.

Phillip turned to us. We granted Phillip’s certiorari 

petition to decide “[w]hether the Supreme Court of the 

Virgin Islands has the authority, under 48 U.S.C. § 1613, 

to disregard precedent set by the Third Circuit Court of 
5

Appeals during a time when the Third Circuit Court of 

Appeals was the only source of binding authority 

construing territorial law.” See Order Granting Pet. Writ 

Cert. at 1, Defoe v. Phillip, No. 12-1586 (3d Cir. May 10, 

2012) (citing Pet. Writ Cert. at 9). We also directed the 

parties to address “whether this Court has jurisdiction 

over the petition pursuant to 48 U.S.C. § 1613.” Id.

Before resolving these questions, a review of the Virgin 

Islands court system is in order.

II

Congress laid the groundwork for the current 

Virgin Islands court system nearly sixty years ago. See

generally Revised Organic Act of 1954, 48 U.S.C. 

§ 1541 et seq. The Revised Organic Act enabled the 

Virgin Islands legislature to create its own court system, 

including trial courts and an appellate court. Id.

§ 1611(b). 

In addition, the Act established the District Court 

of the Virgin Islands—an Article IV court—and gave it 

original jurisdiction over local claims. Id. §§ 1611(a), 

1612(b). It also gave the District Court concurrent 

jurisdiction over any local crimes that are sufficiently 

similar to federal crimes. See Callwood v. Enos, 230 F.3d 

627, 631 (3d Cir. 2000) (citing 48 U.S.C. § 1612 (c)). 

Until recently, the District Court served as more than a 

trial court. The Appellate Division of the District Court 

also heard all appeals from local courts. 48 U.S.C. 
6

§ 1613a(a). In turn, our Court had appellate jurisdiction 

over appeals from the Appellate Division. Id. § 1613a(c). 

Such review was a matter of right.

Congress changed this system in 1984 by 

amending the Revised Organic Act. This amendment 

enabled the Virgin Islands legislature to vest original 

jurisdiction over local actions exclusively in local courts. 

Parrott v. Gov’t of U.S. Virgin Islands, 230 F.3d 615, 

619 (3d Cir. 2000) (citing 48 U.S.C. §§ 1611(a), 

1612(b)). The Virgin Islands exercised that power, 

vesting exclusive jurisdiction over local actions in the 

Territorial Court of the Virgin Islands—now known as 

the Superior Court of the Virgin Islands. 4 V.I. Code § 2. 

After this amendment, the District Court continued to 

hear appeals from local trial courts, and it retained 

concurrent jurisdiction over local crimes that are similar

to federal crimes. See Callwood, 230 F.3d at 631.

The next major change came in 2004. Fifty years 

after receiving authority to do so, the Virgin Islands 

legislature established its own appellate court—the 

Supreme Court of the Virgin Islands. See 4 V.I. Code § 2. 

The Supreme Court, composed of three justices, began 

exercising its judicial authority on January 29, 2007. It 

handed down its first decision later that year. It continues 

to hear all appeals from the Superior Court of the Virgin 

Islands. See id. §§ 21(a), 32, 33. 

The founding of the Virgin Islands Supreme Court 
7

altered the relationship between the federal judiciary and 

the Virgin Islands court system. Going forward, the 

District Court of the Virgin Islands no longer has 

appellate jurisdiction over any local decisions.

2

[F]or the first fifteen years following the 

establishment of the appellate court 

authorized by section 1611(a) of this title, 

the United States Court of Appeals for the 

Third Circuit shall have jurisdiction to 

review by writ of certiorari all final 

See 48 

U.S.C. § 1613a(a) (indicating that the District Court’s 

appellate jurisdiction ends once the Virgin Islands 

legislature creates its own appellate court). Instead, as set 

out in 48 U.S.C. § 1613, we have certiorari jurisdiction 

over the Virgin Islands Supreme Court:

 2 On appeal, the District Court still reviews 

territorial cases that were “pending in [the District 

Court]” before the establishment of the Supreme Court, 

and we still hear appeals from those decisions. 48 U.S.C. 

§ 1613a(d) (“The establishment of the appellate court 

shall not result in the loss of jurisdiction of the district 

court over any appeal then pending in it. The rulings of 

the district court on such appeals may be reviewed in the 

. . . Third Circuit and in the Supreme Court 

notwithstanding the establishment of the appellate 

court.”).
8

decisions of the highest court of the Virgin 

Islands from which a decision could be had.

Our certiorari jurisdiction will last for a maximum 

of fifteen years. After that, the Virgin Islands Supreme 

Court will have the same role as the highest court of any 

state—it will be the final authority on Virgin Islands law. 

The United States Supreme Court will review its 

decisions on federal law, and we will no longer have 

appellate jurisdiction over its decisions. In the meantime, 

we have established rules that govern the process of 

granting certiorari petitions. See, e.g., Third Circuit Local 

Appellate Rule 112.1(a) (“Review on writ of certiorari is 

not a matter of right, but of judicial discretion, and will 

be granted only when there are special and important 

reasons therefor.”).3

The fifteen-year period established by § 1613 is 

merely a default. The statute requires our Court to submit 

a report to Congress every five years after the creation of 

 3 Our local rules provide a list of reasons for 

granting certiorari petitions. Relevant to this case, we 

will grant a petition if “[t]he Supreme Court of the Virgin 

Islands has decided a question in a way that conflicts 

with applicable decisions of this court.” Local Appellate 

Rule 112.1(1)(a).
9

the Virgin Islands Supreme Court.4

Earlier this year, a committee from the Third 

Circuit prepared the initial five-year report.

The purpose of the 

report is to evaluate “whether it has developed sufficient 

institutional traditions to justify direct review by the 

Supreme Court of the United States from all [ ] final 

decisions.” 48 U.S.C. § 1613. 

5

 4 The relevant language from 48 U.S.C. § 1613 

states:

The Judicial Council of the Third Circuit 

shall submit reports to the Committee on 

Energy and Natural Resources of the Senate 

and the Committee on Natural Resources of 

the House of Representatives at intervals of 

five years following the establishment of 

such appellate court as to whether it has 

developed sufficient institutional traditions 

to justify direct review by the Supreme 

Court of the United States from all such 

final decisions.

5 The committee members included Circuit Judge 

D. Brooks Smith, Senior Circuit Judge Walter Stapleton, 

and Third Circuit Clerk Marcia Waldron.

See Judicial 

Council of the U.S. Court of Appeals for the Third 

Circuit, Report on the Virgin Islands Supreme Court
10

(2012), available at

http://www.visupremecourt.org/wfData/files/BookletRep

ortofVirginIslandsSupremeCourt.pdf. The committee 

reviewed the Supreme Court’s decisions, practices, 

facilities, and day-to-day operations. It concluded “that 

the Supreme Court of the Virgin Islands ‘has developed 

sufficient institutional traditions to justify direct review 

by the Supreme Court of the United States.’” Id. at 17 

(quoting 48 U.S.C. § 1613). The committee 

recommended that Congress eliminate our certiorari 

jurisdiction. Id. Still, Congress must act for that 

recommendation to take effect.6

 6 We acknowledge that, based on the committee’s 

recommendation, both houses of Congress recently 

passed H.R. 6116, a bill to eliminate this Court’s interim 

certiorari jurisdiction over final decisions of the Supreme 

Court in favor of direct certiorari review by the United 

States Supreme Court. See An Act to Amend the Revised 

Organic Act of the Virgin Islands, H.R. 6116, 112th 

Cong. (2012) (passed by the House and the Senate as of 

December 13, 2012). Because the president has not 

signed H.R. 6116 as of this opinion’s publication, we 

need not consider its effect on our certiorari jurisdiction 

over this case. See I.N.S. v. Chadha, 462 U.S. 919, 951–

52 (1983) (concluding that Congress can exercise 

legislative power only through bicameralism and 

presentment).

For now, we retain 

certiorari jurisdiction over final decisions of the Virgin 
11

Islands Supreme Court.

III

We first address the question of appellate

jurisdiction. During our interim certiorari period, we have 

authority to “review by writ of certiorari all final 

decisions of the highest court of the Virgin Islands from 

which a decision could be had.” 48 U.S.C. § 1613. The 

question is whether the Virgin Islands Supreme Court’s 

order reversing the Superior Court and remanding for 

further proceedings satisfied the “final decisions”

requirement in § 1613. We conclude that it did.

We recently considered the meaning of the term 

“final decisions.” See Virgin Islands v. John, 654 F.3d

412 (3d Cir. 2011). Under John, a decision is final only if 

it is “‘final’ within the meaning of the United States 

Supreme Court’s certiorari jurisdiction statute.” Id. at 415

(citing 28 U.S.C. § 1257 (“Final judgments or decrees 

rendered by the highest court of a State . . . may be 

reviewed by the Supreme Court by writ of 

certiorari . . . .”)). In general, a judgment is final under 

the Supreme Court’s certiorari statute only if nothing 

“further remains to be determined by a State court, no 

matter how dissociated from the [ ] federal issue that has 

finally been adjudicated by the highest court of the 

State.” Cox Broad. Corp. v. Cohn, 420 U.S. 469, 477 

(1975) (quoting Radio Station WOW, Inc. v. Johnson, 

326 U.S. 120, 124 (1945)) (quotation marks omitted). 
12

Here, the Virgin Islands Supreme Court remanded to the 

Superior Court, and the Superior Court still needs to 

decide whether Phillip was negligent. This posture

suggests that the Supreme Court’s decision was not final. 

Yet the definition of a “final decision” is not so 

absolute. The United States Supreme Court has 

recognized four exceptions to the finality rule:

In the first category are those cases in which 

there are further proceedings—even entire 

trials—yet to occur in the state courts but 

where for one reason or another the federal 

issue is conclusive or the outcome of further 

proceedings preordained. . . .

Second, there are cases . . . in which the 

federal issue, finally decided by the highest 

court in the State, will survive and require 

decision regardless of the outcome of future 

state-court proceedings. . . .

In the third category are those situations 

where the federal claim has been finally 

decided, with further proceedings on the 

merits in the state courts to come, but in 

which later review of the federal issue 

cannot be had, whatever the ultimate 

outcome of the case. . . .
13

Lastly, there are those situations where the 

federal issue has been finally decided in the 

state courts with further proceedings 

pending in which the party seeking review 

here might prevail on the merits on 

nonfederal grounds, thus rendering 

unnecessary review of the federal issue by 

this Court, and where reversal of the state 

court on the federal issue would be 

preclusive of any further litigation on the 

relevant cause of action rather than merely 

controlling the nature and character of, or 

determining the admissibility of evidence in, 

the state proceedings still to come. In these 

circumstances, if a refusal immediately to 

review the state court decision might 

seriously erode federal policy, the Court has 

entertained and decided the federal issue, 

which itself has been finally determined by 

the state courts for purposes of the state 

litigation.

Id. at 479–83. When one of these exceptions applies, the 

Supreme Court will review a state court’s ruling on a 

federal issue even when additional issues await resolution

in the lower courts. In such instances, “immediate rather 

than delayed review would be the best way to avoid the 

mischief of economic waste and of delayed justice.” Id.

at 477–78 (quoting Radio Station WOW, 326 U.S. at 124) 
14

(quotation marks omitted). 

We conclude that the Cox exceptions apply to the 

finality requirement in our certiorari statute—albeit with 

one difference. The Supreme Court reviews state 

decisions only on questions of federal law. See 28 U.S.C. 

§ 1257. By contrast, we review decisions of the Virgin 

Islands Supreme Court on questions of both federal and 

local law. See Pichardo v. V.I. Com’r of Labor, 613 F.3d 

87, 94 (3d Cir. 2010). As a result, we apply the 

exceptions by examining the federal or local issue that 

the Supreme Court has decided—again, even though

additional issues might await resolution. In effect, we 

apply the language from Cox by replacing the phrase

“federal issue” with the phrase “federal or local issue.”

According to Phillip, this case fits within the third 

and fourth exceptions.7

 7 Phillip argues that Local Appellate Rule 112.1 

provides another basis for jurisdiction. But this rule 

simply states our policy for granting certiorari—it does 

not create an additional basis for jurisdiction. Only 

Congress can do that.

We disagree—at least with 

respect to the third exception. If we remand for lack of

jurisdiction, we could still review the Supreme Court’s

decision after the losing party filed another petition.

Phillip argues that res judicata would prevent us from 
15

granting certiorari. This argument is based on a 

misunderstanding of res judicata, which prevents parties 

from making the same claim in separate actions—not 

from making the same argument on separate appeals in a 

single action. See United States v. 5 Unlabeled Boxes, 

572 F.3d 169, 173 (3d Cir. 2009) (noting that res judicata 

applies only if there was “a final judgment on the merits 

in a prior suit” (emphasis added)).

That leaves the fourth exception. Subsequent

Supreme Court cases have confirmed that the exception 

applies if three requirements are met: (1) the appellant 

might prevail at trial on separate grounds; (2) reversing 

the state court would end the litigation on the claim; and 

(3) failing to review the decision “might seriously erode 

federal policy.” Florida v. Thomas, 532 U.S. 774, 780 

(2001); Fort Wayne Books, Inc. v. Indiana, 489 U.S. 46, 

55 (1989). 

This case meets the first two requirements. Phillip 

might prevail at trial on separate grounds—for example, 

the Superior Court might conclude that he was not

negligent or that Defoe assumed the risk of injury. And if 

we reversed the Supreme Court by concluding that 

Tavarez still applies, our decision would effectively 

reinstate the Superior Court’s grant of summary 

judgment and thus would end the litigation. The question, 

then, is whether this case meets the third requirement—

that is, whether failing to review the Supreme Court’s 
16

decision “might seriously erode federal policy.”

This question requires a case-by-case inquiry. In 

Florida v. Thomas, the United States Supreme Court 

concluded that a suppression motion did not invoke 

sufficient “federal policy” concerns. 532 U.S. at 780

(“Here the State can make no claim of serious erosion of 

federal policy that is not common to all run-of-the-mine 

decisions suppressing evidence in criminal trials.”). By 

comparison, in Fort Wayne Books v. Indiana, the Court 

concluded that an Indiana case met this requirement 

because the case held that a specific application of the 

Indiana Racketeer Influenced and Corrupt Organization

statute was unconstitutional. “[A] challenge to the 

constitutionality of the use of RICO statutes to 

criminalize patterns of obscenity offenses calls into 

question the legitimacy of the law enforcement practices 

of several States, as well as the Federal Government.” 

489 U.S. at 55. It also pointed out that “[a]djudicating the 

proper scope of First Amendment protections has often 

been recognized by this Court as a ‘federal policy’ that 

merits application of an exception to the general finality 

rule.” Id.

This case also meets the third requirement. Our 

Court has had a significant role in overseeing the Virgin 

Islands Supreme Court. See 48 U.S.C. § 1613; Pichardo, 

613 F.3d at 100 n.11 (“[W]e are entrusted with the task 

of overseeing the development of the Virgin Islands 
17

Supreme Court’s institutional traditions.” (quotation 

marks omitted)). We have certiorari jurisdiction over the 

Supreme Court’s decisions—both on questions of federal 

law and on questions of local law. See Pichardo, 613 

F.3d at 94. And, by law, we are required to submit 

regular reports to Congress evaluating the Supreme

Court’s progress. 48 U.S.C. § 1613. Having chosen to 

invest in us this oversight role by statute, Congress has 

declared a specific federal policy, the relevant federal 

policy for Cox purposes. We believe that if we failed to 

review the Supreme Court’s Defoe decision at this time, 

we would weaken our oversight role—and in doing so,

would seriously erode federal policy. After all, by not 

reviewing that decision, we would leave the precedential 

posture of our pre-2007 territorial cases undecided. To 

prevent such uncertainty—and to avoid shirking our 

oversight role—we conclude that we have jurisdiction 

under § 1613. 

IV

We now consider whether the Virgin Islands 

Supreme Court may reject our pre-2007 decisions on

local law. Upon its establishment, the Virgin Islands 

Supreme Court became the final authority on local law—

subject to a qualification discussed below. We 

recognized that the Supreme Court would assume this 

role even before its creation. See BA Props. Inc. v. Gov’t 

of U.S. Virgin Islands, 299 F.3d 207, 212 (3d Cir. 2002) 
18

(“[The Virgin Islands Supreme Court] would essentially 

have the final word on the interpretation of local Virgin 

Islands law.”). And we reaffirmed this conclusion five 

years later when the Virgin Islands legislature actually 

created the Supreme Court. See Edwards v. HOVENSA, 

LLC, 497 F.3d 355, 361 n.3 (3d Cir. 2007) (noting that 

“[g]oing forward, now that the Virgin Islands has 

established an insular appellate court [it] will begin 

developing indigenous jurisprudence” (emphasis 

added)).

As a result, when the District Court faces a novel 

question of Virgin Islands law, it must predict how the 

Supreme Court will resolve that question. Id. And we 

must make similar predictions. A few years ago, we 

interpreted a Virgin Islands statute prohibiting 

unauthorized individuals from carrying firearms, 14 V.I. 

Code § 2253(a). Before doing so, we noted “the absence 

of controlling Virgin Islands precedent.” Gov’t of U.S. 

Virgin Islands v. Lewis, 620 F.3d 359, 364 n.5 (3d Cir. 

2010). We were “mindful, of course, that the authority to 

interpret [the statute] lies centrally with the newly created 

Supreme Court of the Virgin Islands.” Id. And we 

confirmed that our decision did not “preclude the 

Supreme Court of the Virgin Islands from offering its 

own interpretation.” Id.

Consequently, our relationship with the Virgin 

Islands Supreme Court is much like our relationship with 
19

other state courts—we generally defer on questions of 

local law. Such deference is consistent with the text of 

§ 1613, which assumes that the Virgin Islands Supreme 

Court will have the freedom to create its own 

“institutional traditions.” 48 U.S.C. § 1613 (“The 

relations between the courts established by the 

Constitution or laws of the United States and the courts 

established by local law . . . shall be governed by the 

laws of the United States pertaining to the relations 

between the courts of the United States . . . and the courts 

of the several States in such matters and proceedings.”).

But our relationship with the Virgin Islands 

Supreme Court is different in at least one important 

respect. We have certiorari jurisdiction over the Virgin 

Islands Supreme Court. 48 U.S.C. § 1613. And unlike the 

United States Supreme Court’s certiorari statute, § 1613

is not limited to decisions on federal law. We also have 

the discretion to review the Virgin Islands Supreme 

Court’s decisions on local law. See Pichardo, 613 F.3d at 

96 (noting that unlike the United States Supreme Court’s 

review of state-court decisions, “[o]ur review is not 

limited to cases that implicate the United States 

Constitution or federal law”).

Because of this difference, we concluded in 

Pichardo that “[i]t is, subject to our review for manifest 

error, the role of the Virgin Islands Supreme Court to say 

what the law of the territory is. We will reverse a 
20

decision of the Supreme Court . . . that is based upon 

territorial law only if it is inescapably wrong.” Id. at 94. 

In other words, the Supreme Court has assumed our 

erstwhile role as the final authority on territorial law, 

though with an important limitation: its decisions must 

not be manifestly erroneous or inescapably wrong. 

The Ninth Circuit adopted this standard nearly a 

decade ago. Haeuser v. Dep’t of Law, 368 F.3d 1091, 

1099 (9th Cir. 2004). By statute, the Ninth Circuit once 

had the same relationship with the Guam Supreme Court 

as the one we now enjoy with the Virgin Islands Supreme 

Court.8

 8 Congress has since removed the Ninth Circuit’s 

certiorari jurisdiction. See 48 U.S.C. § 1424-2. But the 

Ninth Circuit’s former jurisdictional statute stated:

At the time, the Ninth Circuit concluded that it 

[F]or the first fifteen years following the 

establishment of the appellate court . . . , the 

United States Court of Appeals for the Ninth 

Circuit shall have jurisdiction to review by 

writ of certiorari all final decisions of the 

highest court of Guam from which a 

decision could be had. The Judicial Council 

of the Ninth Circuit shall submit reports to 

the Committee on Energy and Natural 

Resources of the Senate and the Committee 

on Natural Resources of the House of 
21

 

Representatives at intervals of five years 

following the establishment of such 

appellate court as to whether it has 

developed sufficient institutional traditions 

to justify direct review by the Supreme 

Court of the United States from all such 

final decisions. The United States Court of 

Appeals for the Ninth Circuit shall have 

jurisdiction to promulgate rules necessary to 

carry out the provisions of this subsection.

48 U.S.C. § 1424-2 (2000). This tracks the language from 

48 U.S.C. § 1613 (emphasis added to show differences):

[F]or the first fifteen years following the 

establishment of the appellate court . . . , the 

United States Court of Appeals for the Third

Circuit shall have jurisdiction to review by 

writ of certiorari all final decisions of the 

highest court of the Virgin Islands from 

which a decision could be had. The Judicial 

Council of the Third Circuit shall submit 

reports to the Committee on Energy and 

Natural Resources of the Senate and the 

Committee on Natural Resources of the 

House of Representatives at intervals of five 

years following the establishment of such 

appellate court as to whether it has 
22

would review local decisions of the Guam Supreme 

Court for manifest error. Id. (noting that the “degree of 

deference” owed to the Guam Supreme Court “does not 

allow us to reverse the Guam Supreme Court’s decisions 

on matters of local law unless clear or manifest error is 

shown”).

The Ninth Circuit did not create the “manifest 

error” standard. Instead, the United States Supreme Court 

first articulated this standard in 1940. The Supreme Court 

concluded that the First Circuit—which once had a 

similar role in supervising the Supreme Court of Puerto 

Rico—should generally defer to local decisions of that 

territorial court. “For to justify reversal in such cases, the 

error must be clear or manifest; the interpretation must be 

inescapably wrong; the decision must be patently 

erroneous.” Sancho v. Texas Co., 308 U.S. 463, 471 

(1940).

All of this is settled law. Pichardo requires us to 

affirm the decisions of the Virgin Islands Supreme Court

 

developed sufficient institutional traditions 

to justify direct review by the Supreme 

Court of the United States from all such 

final decisions. The United States Court of 

Appeals for the Third Circuit shall have 

jurisdiction to promulgate rules necessary to 

carry out the provisions of this section.
23

that are based on territorial law unless those decisions are

inescapably wrong. In Phillip’s mind, however, this 

deferential standard does not apply when the Supreme 

Court disregards one of our pre-2007 decisions on 

territorial law. Instead, as his argument goes, we should 

conclude that the Supreme Court is bound to our 

pronouncements from days gone by.

As for our post-2007 precedents, we have already 

rejected this argument. We stated in Lewis “that the 

authority to interpret [a Virgin Islands statute] lies 

centrally with the newly created Supreme Court of the 

Virgin Islands. We do not mean by our decision today to 

preclude the Supreme Court of the Virgin Islands from 

offering its own interpretation of [the statute].” 620 F.3d 

at 364 n.5 (citation omitted). The Supreme Court may

disregard our post-2007 decisions on territorial law—

again, as long as the Court does not manifestly err in 

doing so.

9

We see no reason to adopt a different standard for 

our pre-2007 precedents. Section 1613 does not 

distinguish between cases handed down before and after 

 9 We should note that the Virgin Islands Supreme 

Court would not be free to reject our post-2007 decisions 

on local law if we had overturned a Supreme Court 

decision for being inescapably wrong.
24

the Supreme Court’s founding, nor do our precedents

such as Pichardo and Lewis. In fact, § 1613 allows the 

Virgin Islands Supreme Court to develop its own 

“institutional traditions.” This assumes that the Supreme 

Court “will have the freedom” to create its own “legal 

precedent.” Pichardo, 613 F.3d at 98 (quoting Haeuser, 

368 F.3d at 1099). The Supreme Court would have far 

less freedom to do so if it remained bound to our pre2007 cases.

More to the point, courts adopting the precedents 

of past courts typically have the freedom to overturn 

those precedents. For example, the Eleventh Circuit 

branched off from the Fifth Circuit in 1981. Although the 

Eleventh Circuit relies on pre-1981 Fifth Circuit cases, it 

is free to overrule them. See Bonner v. City of Prichard, 

661 F.2d 1206, 1210 (11th Cir. 1981) (en banc) (“The 

decisions of the former Fifth Circuit, adopted as 

precedent by the Eleventh Circuit, will, of course, be 

subject to the power of the Eleventh Circuit sitting en 

banc to overrule any such decision.”). The Supreme 

Court of Guam has similarly claimed the authority to 

reject Ninth Circuit precedents from a time when it 

provided the final word on local law:

[T]his Court does not recognize the 

decisions of the Appellate Division [of the 

District Court of Guam] as controlling our 

construction of law. We consider its 
25

opinions as precedent that is binding upon 

the trial courts of Guam, but these decisions, 

like those of the [Ninth Circuit] Court of 

Appeals, are considered persuasive authority 

when we consider an issue. . . . It should be 

underscored that the creation of the Supreme 

Court of Guam did not erase pre-existing 

case law. Precedent that was extant when we 

became operational continues unless and 

until we address the issues discussed there.

Guam v. Quenga, No. CRA96-005, 1997 WL 460709, at 

*4 n.4 (Guam May 18, 1997).

We therefore conclude that the Virgin Islands 

Supreme Court may reject our local decisions that 

predate its establishment. Of course, just as the Supreme 

Court of Guam was subject to a manifest-error standard 

of review during the Ninth Circuit’s short-lived certiorari 

period, the Virgin Islands Supreme Court is subject to the 

same standard of review during our certiorari period. 

This standard certainly limits the Supreme Court’s 

freedom to reject our decisions. But it does not force the 

Supreme Court to follow us in lock-step.

In a last-ditch effort, Phillip contends that Local 

Appellate Rule 112.1(a)(1) binds the Supreme Court to 

our pre-2007 local decisions. This rule states that when 

deciding whether to grant certiorari, we will consider 

whether “[t]he Supreme Court of the Virgin Islands has 
26

decided a question in a way that conflicts with applicable 

decisions of this court or the United States Supreme 

Court.” According to Phillip, this rule is an assertion that 

the Supreme Court must follow our pre-2007 precedents. 

But the rule makes no such assertion—it states that we 

will consider granting certiorari when the Supreme Court 

disagrees with us, nothing more.

V

The final question is whether the Supreme Court’s 

decision to reject Tavarez was manifestly erroneous.

Phillip argues that any disagreement with our precedents

meets this standard such that no additional inquiry is 

necessary. If we reject this absolute rule, Phillip also

argues that the Supreme Court’s decision to reject 

Tavarez in particular was manifestly erroneous. We 

reject both arguments. 

First, however, we consider what it means for a 

decision to be manifestly erroneous or inescapably 

wrong. We have yet to conclude that a decision of the 

Virgin Islands Supreme Court meets this standard. For its 

part, the Ninth Circuit only once concluded that a 

decision of the Supreme Court of Guam was manifestly 

erroneous. In Haeuser, the Ninth Circuit overturned the 

Guam Supreme Court for failing to apply a rule that it 

had adopted in the same opinion. 368 F.3d at 1101

(“[T]he Supreme Court was required, under the very 

standard it announced earlier in its opinion, to review 
27

‘the record . . . in its entirety,’ and then apply the law to 

the facts.”) (quoting Haeuser v. Dep’t of Law, No. 

CVA98-009, 1999 WL 257611, at *2 (Guam Apr. 30, 

1999)).

According to the United States Supreme Court, to 

reverse under this standard, “it would not be sufficient if 

we . . . merely disagreed with that interpretation. Nor 

would it be enough that the . . . tribunal chose what might 

seem, on appeal, to be the less reasonable of two possible 

interpretations.” Sancho, 308 U.S. at 471. To warrant 

reversal, then, the Virgin Islands Supreme Court must 

commit an egregious error—for example, by issuing an 

opinion with a significant internal inconsistency or by 

blatantly ignoring the plain text of a statute. More than 

mere disagreement is necessary.

We refuse to say that any disagreement with our 

precedents is, without further question, manifestly 

erroneous. For starters, some issues of local law are 

within the discretion of the highest court in that 

jurisdiction. For example, the Virgin Islands Supreme 

Court has the authority to shape the common law within 

the Virgin Islands. See Banks v. Int’l Rental & Leasing 

Corp., 55 V.I. 967, 980 (2011) (concluding that it 

“possesses the inherent power to shape the common law 

in the Virgin Islands”). It is unclear how its common-law 

decisions could be inescapably wrong—even those 

decisions that disagree with our pre-2007 cases—because 
28

it has the inherent authority to shape the common law as 

it deems appropriate.

But the common law is not at issue in this case. 

We face a question of statutory interpretation, and such 

questions are more likely to have answers that are either 

objectively right or objectively wrong. Even so, we 

cannot say that all disagreements with us must be wrong. 

After all, we implicitly acknowledge that our precedents 

are imperfect when we decide to limit or overrule them. 

See, e.g., In re Grossman’s Inc., 607 F.3d 114, 121 (3d 

Cir. 2010) (en banc) (overruling a sixteen-year-old 

precedent); Animal Sci. Products, Inc. v. China 

Minmetals Corp., 654 F.3d 462, 467–68 & n.6 (3d Cir. 

2011) (overruling two Third Circuit precedents that 

conflicted with Supreme Court case law); see also

Montana v. Hall, 481 U.S. 400, 408 (1987) (Marshall, J., 

dissenting) (“We are not infallible, as is evidenced, for 

example, by the number of cases each Term that are 

dismissed after plenary briefing and oral argument as 

having been improvidently granted.”). And the Supreme 

Court explicitly acknowledges our imperfections any 

time it reverses a decision of this Court. See, e.g, 

Coleman v. Johnson, 132 S. Ct. 2060, 2065 (2012) (per 

curiam), rev’g Johnson v. Mechling, 446 F. App’x 531 

(3d Cir. 2011). We therefore reject Phillip’s general 

argument that any disagreement with our pre-2007 cases 

is necessarily wrong.
29

We turn to Phillip’s alternative argument that the 

Supreme Court manifestly erred when it rejected Tavarez

in particular. Defoe rejects this argument, but he first

contends that we should not consider this question at all.

For one thing, Defoe claims that this narrow question is 

outside the scope of certiorari. We disagree. We granted 

certiorari to decide whether the Supreme Court “has the 

authority, under 48 U.S.C. § 1613, to disregard precedent

set by the Third Circuit . . . .” See Order Granting Pet. 

Writ Cert. at 1, Defoe, No. 12-1586 (emphasis added) 

(citing Pet. Writ Cert. at 9). We interpret the word 

“precedent” to mean both precedents generally and 

Tavarez in particular. The parties apparently adopted this 

interpretation, too—both sides addressed the Supreme 

Court’s treatment of Tavarez in their briefs.10

Next, Defoe claims that the Supreme Court’s 

decision does not conflict with our decision in Tavarez. 

This suggestion is wrong. Defoe points out that the 

defendant in Tavarez was the plaintiff’s supervisor, see

372 F.3d at 189, whereas Phillip was merely Defoe’s 

 10 In our view, it is significant that our grant of 

certiorari used the singular form “precedent,” not the 

plural form “precedents.” Moreover, the greater includes 

the lesser, and Tavarez certainly is a precedent of our 

Court. Finally, Defoe is not harmed by our interpretation 

because we ultimately affirm the Supreme Court.
30

coworker. This factual distinction is of no consequence

because Tavarez explicitly applies to coworkers as well. 

See id. at 191 (noting that “scrutiny of the plain language 

. . . fails to reveal any intent by the Virgin Islands’ 

legislature to address whether an injured employee may 

initiate a civil action against a co-employee or a 

supervisor of the same employer” (emphasis added)). For 

that reason, the Supreme Court rightly concluded that its 

decision conflicts with ours. Defoe, 2012 WL 37404, at 

*12 (“We acknowledge that the Superior Court faithfully 

applied precedent that is binding on it when it granted 

Phillip’s motion for summary judgment based on 

Tavarez.”).

That brings us back to Phillip’s claim that the 

Supreme Court erroneously rejected Tavarez. In Tavarez,

we interpreted 24 V.I. Code § 284:

(a) When an employer is insured under this 

chapter, the right herein established to 

obtain compensation shall be the only 

remedy against the employer . . . .

(b) For the purposes of this section, . . . [t]he 

‘statutory employer and borrowed servant’ 

doctrine are not recognized in this 

jurisdiction, and an injured employee may 

sue any person responsible for his injuries 

other than the employer named in a 

certificate of insurance . . . .
31

We concluded that § 284(a) prevents law suits against 

coworkers, despite the statement in subsection (b) that 

“an injured employee may sue any person responsible for 

his injuries other than the employer named in a certificate 

of insurance” (emphasis added). We held that “§ 284(b) 

alters only the immunity that statutory employers 

previously enjoyed, subjecting these statutory employers 

to personal liability if they are not named in the 

certificate of insurance.” Tavarez, 372 F.3d at 192. 

The statutory canon ejusdem generis supports this 

interpretation. As we concluded in Tavarez, “the general 

term ‘any person’ in the second sentence of § 284(b) is a 

reference to the preceding specific terminology 

discussing statutory employers and borrowed servants.” 

Id. This means that the term “any person” does not

include coworkers generally. In addition, suits against 

coworkers might frustrate the purpose of § 284(a) 

because “an employer would normally indemnify or 

assume the defense of its employee sued for negligence.” 

Id.

In our view, Tavarez remains the soundest

interpretation of § 284. Even so, to warrant reversal, 

Defoe must be more than simply wrong. It must be 

inescapably wrong. And the Supreme Court’s opinion

does not meet this standard. As we recognized in 

Tavarez, the Supreme Court’s interpretation is defensible 

on textual grounds: “[T]he apparent breadth of the term 
32

‘any person,’ combined with the fact that [the defendant] 

was not personally named in the certificate of insurance, 

appears to give [that] argument some support.” Id. at 191.

The analysis in Defoe is quite thorough and not 

obviously flawed. The Supreme Court cited twenty-eight 

instances where, despite a statutory scheme creating 

employer immunity, a court has allowed an injured 

employee to sue a coworker. See Defoe, 2012 WL 37404, 

at *5 n.6; see, e.g., Highway Constr. Co. v. Moses, 483 

F.2d 812, 815 (8th Cir. 1973) (interpreting the South 

Dakota workers’ compensation statute and concluding 

that “[t]he employer’s immunity from suit by his 

employees, however, does not extend to immunize a

personally negligent employee from suit by coworkers 

whom he has injured”). But see, e.g., Bresnahan v. Barre, 

190 N.E. 815, 817 (Mass. 1934). The Defoe opinion does 

not contain a major internal inconsistency—unlike the 

decision that the Ninth Circuit reversed in Haeuser. See 

368 F.3d at 1101 (reversing the Guam Supreme Court).

Moreover, it is hard to fault the Supreme Court for 

not invoking ejusdem generis, a canon we use to discover 

legislative intent. The canon does not apply when the text 

and structure is sufficiently clear—which often is a close 

question, as it was in this case. See Waterfront Comm’n 

of N.Y. Harbor v. Elizabeth-Newark Shipping, Inc., 164 

F.3d 177, 184 (3d Cir. 1998) (noting that “[t]he principle 

of ejusdem generis . . . is not a rule of law but merely a 
33

useful tool of construction resorted to in ascertaining 

legislative intent. The rule should not be employed when 

the intention of the legislature is otherwise evident”

(quotation marks and citation omitted)); Norfolk & W. 

Ry. v. Am. Train Dispatchers Ass’n, 499 U.S. 117, 129 

(1991) (“[Ejusdem generis] does not control, however, 

when the whole context dictates a different conclusion.”). 

Finally, the Virgin Islands Supreme Court 

considered the implications of its decision. It noted that if

employers fear the costs of indemnifying their 

employees, they can contractually agree not to provide 

indemnification. Defoe, 2012 WL 37404, at *11. 

Although this argument ignores the reality that employers 

have already entered many contracts based on the

assumption that such agreements are unnecessary, it is

still a reasonable argument going forward. We therefore 

conclude that Defoe is neither manifestly erroneous nor 

inescapably wrong. 

* * *

The Supreme Court of the Virgin Islands is on the 

road to Erie R. Co. v. Tompkins, 304 U.S. 64, 78 (1938)

(requiring federal courts to defer to local courts on issues

of local law). We are confident that it will soon reach its 

destination. For now, we defer to the Supreme Court on 

questions of local law, subject to a manifest-error 

standard of review, including with respect to our pre2007 precedents. Because the Supreme Court did not 
34

manifestly err in rejecting Tavarez, we will affirm its 

judgment.
 1

ROTH, Circuit Judge, Concurring.

I agree with the Majority that we have jurisdiction 

of this petition for certiorari and that the Supreme Court 

of the Virgin Islands has the authority under 48 U.S.C. §

1613 to disregard precedent set by the Third Circuit 

Court of Appeals during a time when the Third Circuit 

Court of Appeals was the only source of binding 

authority construing territorial law. Because the grant of 

certiorari in this case bears only on the general question 

and does not speak of any consideration of manifest error 

in this specific case, I find Section V of the majority 

opinion to be beyond the scope of the grant of certiorari 

here. For that reason, I conclude that Section V is not 

necessary to our response to this petition for certiorari 

and I do not join in it.