## Facts

- The City of Thibodaux, Louisiana sought to expropriate portions of Louisiana Power & Light Company’s electric utility property located in recently annexed areas.
- The City relied on a 1900 Louisiana statute (Act 111) authorizing municipal expropriation.
- Louisiana Power & Light contended the City lacked authority to condemn only part of an integrated utility system and cited a Louisiana Attorney General opinion suggesting municipalities lacked such authority under Act 111.
- The City filed the expropriation action in Louisiana state court; Louisiana Power & Light removed to federal court based on diversity jurisdiction.
- The federal district court, on its own motion, stayed proceedings to allow the Louisiana Supreme Court an opportunity to construe the previously uninterpreted statute.
- The Fifth Circuit reversed, concluding the federal court should decide the state-law issue rather than stay the case.

## Issues

1. Whether a federal district court sitting in diversity may stay proceedings to permit a state court to give an authoritative construction of an unclear, previously unconstrued state eminent-domain statute implicating substantial state sovereign interests.

## Decision

- The Supreme Court reversed the Fifth Circuit.
- The Court held the district court had authority to stay the federal case pending a prompt state-court construction of the uncertain state statute and properly exercised that discretion.
- The Court emphasized the sovereign importance of eminent domain, the uncertainty of Act 111, and the value of obtaining an authoritative state-law determination.

## Legal Principles

- A federal court with diversity jurisdiction may, in limited circumstances, stay proceedings to allow state courts to resolve unsettled questions of state law.
- Such a stay is especially appropriate where the disputed state-law question concerns a core sovereign function (e.g., eminent domain) and bears on the allocation of governmental power within the state.
- The decision to stay is discretionary and may be justified by considerations of comity, avoidance of speculative interpretations of unclear state statutes, and the interest in uniform state-law construction.

## Conclusion

The Court approved a discretionary, abstention-like stay in a diversity condemnation dispute, permitting the federal court to await authoritative state-court interpretation of an unclear eminent-domain statute that implicated important state sovereign prerogatives.


La. Power & Light Co. v. City of Thibodaux, 360 U.S. 25 (1959)