Artis v. District of Columbia might not have gotten a second look if it didn’t involve a city—but even if it had been brought against a non-government entity it would still affect any entity that gets sued regularly—including states and local governments.

In this case a year after the fact, Stephanie Artis sued the District of Columbia in federal court bringing a number of federal and state law claims related to her termination as a code inspector. It took the federal district court over two and a half years to rule on her claims. It dismissed her sole federal claim as “facially deficient” and no longer had jurisdiction to decide the state law claims.

28 U.S.C 1367(d) states that statutes of limitations for state law claims pending in federal court shall be “tolled” for a period of 30 days after they are dismissed (unless state law provides a longer tolling period).

While Artis was waiting for the federal district court to rule the three-year statutes of limitations on all her state law claims passed. She waited 59 days to refile her claims in state court after the federal district court dismissed her case.  

The question in this case is what “tolled” means under 28 U.S.C 1367(d). Under the suspension theory the state statute of limitations freeze on the day the federal suit is filed and unfreeze with the addition of 30 days when the federal lawsuit is dismissed. Under this theory Artis would have about two years to refile her lawsuit in state court.

Under the grace-period theory if the state statute of limitations would have expired while the federal case was pending a litigant has 30 days from federal court dismissal to refile in state court. Under this theory Artis’s lawsuit in state court is time barred because she waited longer the 30 days to refile in state court.  

The District of Columbia Court of Appeals applied the grace-period theory in this case citing, among other reasons, federalism. “Turning to the present statute under consideration, § 1367(d) appears to invade a historic state power by altering state statutes of limitation. As such, we find that the ‘grace period’ approach hazards significantly less impact on ‘local statutes of limitation’ than the suspension approach.”

Beyond federalism, the grace-period theory is generally better for states and local governments (who are sued more often than they sue others). The suspension theory can significantly extend the statute of limitations of claims, which like the ones in this case languished in a federal court for years, meaning states and local governments would have to defend very stale claims.