Louisiana Power & Light Co. v. Thibodaux
Citation and Court
360 U.S. 25 (1959) — Supreme Court of the United States
Facts
Louisiana Power & Light Company sought to condemn land owned by the City of Thibodaux under a state eminent domain statute. The city removed the case to federal court on diversity grounds. The district court stayed the federal proceedings to allow the Louisiana Supreme Court to interpret the state eminent domain statute, which was unclear as applied to a municipality.
Issue
Whether a federal court sitting in diversity may stay proceedings and defer to state courts for interpretation of an unsettled and important question of state law governing a local governmental matter.
Holding
Yes. A federal court may stay a diversity action and defer to state court resolution of an ambiguous, locally important question of state law — particularly when the state law involves the relationship between the state government and its municipalities.
Rule / Doctrine
Thibodaux abstention (a variant of Burford abstention): federal courts may abstain in diversity cases presenting difficult, unsettled questions of state law whose resolution is of peculiar concern to the state and its governmental structure, even absent an ongoing state proceeding.
Significance
Thibodaux extends the abstention doctrine into the diversity context, where Erie principles already require application of state law. It recognizes that some state law questions — particularly those involving governmental structure and the relationship between a state and its subdivisions — are better resolved by state courts. The case is contested, however, because the Court simultaneously held in County of Allegheny v. Frank Mashuda Co. that mere complexity of state law does not justify abstention.