North Carolina Business Litigation Report

The Law Of The Case And Dead And Stinky Fish

An appellate decision has to be really, really wrong before the same Court will decide that it shouldn't be treated as the "law of the case." In fact, the wrongness has to be as overpowering as a very old and very dead fish, per the Fourth Circuit's opinion today in TFWS, Inc. v. Franchot.

The law of the case doctrine says that the decision of an appellate court "must be followed in all subsequent proceedings in the same case."  The doctrine can be avoided if "(1) a subsequent trial produces substantially different evidence, (2) controlling authority has since made a contrary decision of law applicable to the issue, or (3) the prior decision was clearly erroneous and would work manifest injustice."

The TFWS case is the latest decision in a ten year legal battle over whether Maryland's liquor and wine regulations violate the antitrust laws.  (They do). In today's decision, the fourth appellate decision in the case, the Court of Appeals rejected the State of Maryland's argument that the Court wasn't bound by its first decision in the case.

The State of Maryland argued the "clearly erroneous" exception, offering a new interpretation of its regulatory scheme. Judge Duncan rejected the argument, holding that "[a] prior decision does not qualify for this third exception by being 'just maybe or probably wrong; it must . . . strike us as wrong with the force of a five-week-old, unrefrigerated dead fish."

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Mack Sperling
Brooks Pierce, LLP
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