Q: In the context of retroactivity, what does it mean for a case to be "pending on direct review or not yet final"?
A: You are asking about the rules the U.S. Supreme Court uses to decide when a new ruling on constitutional law it makes will apply to cases which have already been tried. If a person appeals his/her state court conviction and the state court appeal has still not yet decided the appeal when the U.S. Supreme Court issues its new ruling, then and only then will the new ruling apply to the "old" case. "Direct review" means the first appeal of right. If the state court of appeal decides the case and then after that the U.S. Supreme Court makes a new ruling, the new ruling will not apply to the "old" case because direct review is over.
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