Timothy Defoe v. Lenroy Phillip

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)

1
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
2
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.

3
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

4
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.
5
§ 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
6
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 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:

[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

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.”).

7
 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).

8
the Virgin Islands Supreme Court. 4 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.

Earlier this year, a committee from the Third
Circuit prepared the initial five-year report. 5 See Judicial
Council of the U.S. Court of Appeals for the Third
Circuit, Report on the Virgin Islands Supreme Court
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.

9
(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 For now, we retain
certiorari jurisdiction over final decisions of the Virgin

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).
10
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).
11
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. . . .

12
 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)
13
(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 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

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.

14
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

15
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

16
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)

17
(“[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

18
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

19
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 At the time, the Ninth Circuit concluded that it

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:

[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
20
 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
21
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.
22
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.

23
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 pre-
2007 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

24
 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
25
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
26
‘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

27
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.

28
 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.

29
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 . . . .
30
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

31
‘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

32
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 pre-
2007 precedents. Because the Supreme Court did not
33
manifestly err in rejecting Tavarez, we will affirm its
judgment.

34
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.

1