High Court Says Circuit Erred on Abstention

     (CN) - The 8th Circuit erred when it affirmed a federal judge's abstention from a utility regulation case pitting Sprint against the state of Iowa, the Supreme Court held.
     In an opinion written by Justice Ruth Bader Ginsburg, the high court said federal courts are obliged to decide cases within the scope of federal jurisdiction, and that abstention is not in order simply because a parallel state court action has been filed on the same matter.
     Sprint Communications had filed a federal complaint and a petition in state court after the Iowa Utilities Board (IUB) ordered it to pay another company called Windstream intrastate access charges for Voice over Internet Protocol calls.
     A federal judge in Des Moines, Iowa, abstained pursuant to the U.S. Supreme Court decision Younger v. Harris from 1971 and dismissed the action.
     In the 1982 decision Middlesex County Ethics Committee v. Garden State Bar Association, the Supreme Court said Younger abstention applies when there is an ongoing state judicial proceeding that implicates important state interests and gives the challenger an adequate opportunity to raise constitutional issues.
     Finding that these three factors applied to the Sprint case, the 8th Circuit decided in September 2012 that abstention was appropriate.
     But Justice Ginsburg disagreed.
     "The three Middlesex conditions recited above were not dispositive; they were, instead, additional factors appropriately considered by the federal court before invoking Younger," she wrote.
     "Divorced from their quasi-criminal context, the three Middlesex conditions would extend Younger to virtually all parallel state and federal proceedings, at least where a party could identify a plausibly important state interest," she continued. "That result is irreconcilable with our dominant instruction that, even in the presence of parallel state proceedings, abstention from the exercise of federal jurisdiction is the "exception, not the rule."
     Ginsburg then invoked New Orleans Public Service, Inc. v. Council of City of New Orleans (NOPSI), in which the high court defined the "exceptional circumstances" under which abstention is warranted: When a federal court action would intrude upon an ongoing state criminal prosecution; during certain civil enforcement proceedings; and when federal court action would impair the state courts' ability to perform its judicial functions.
     "In short, to guide other federal courts, we today clarify and affirm that Younger extends to the three "exceptional circumstances" identified in NOPSI, but no further," she concluded.