Justices Alito and Sotomayor on How Courts Read Dicta

An amusing and potentially revealing exchange in a recent oral argument.

Catching up on Supreme Court oral arguments, I was struck by the following exchange in Royal Canin U.S.A. v. Wullschleger (a case about the effects of post-removal amendments to a complaint) in which Justice Sotomayor suggested that some lower court judges are taking their cues from dicta in Supreme Court opinions.

From the transcript:

JUSTICE ALITO: Well, do you think that—that courts of appeals read our
decisions differently than we may? I mean, you know, I'm—I was on a
court of appeals for 15 years. If I saw a strong dictum in a Supreme Court decision, I
would very likely just salute and move on. But, here —

(Laughter.)

JUSTICE ALITO:—we have —

JUSTICE SOTOMAYOR: Not now.

(Laughter.)
JUSTICE ALITO:—more of an obligation—it depends, Justice Sotomayor —

(Laughter.)

JUSTICE ALITO:—both when we're considering—you know, when we're considering
what we've written—we know how these things are written. You know, we know how these footnotes are written. Can—do we have liberty to read them a little bit  differently?

Listening to the audio, I took Justice Alito to be suggesting there is dicta and then there is dicta, and justices (particularly those who may have been on the Court at the time) can often tell the difference. I also took Justice Sotomayor to be suggesting that some lower courts don't merely "salute and move on" when they see "strong" dicta in a Supreme Court opinion, but rather take that dicta as their cue for how to proceed and push beyond settled precedent. Justice Alito's response suggests to me he interpreted her comment in the same way. (Again, this may be more clear on the audio.)

I am not sure which case(s) Justice Sotomayor had in mind, but there are many potential candidates.