1. Rules of Decision Act: 28 U.S.C. §1652: “The laws of the several states, except where the Constitution or treaties of the United States or Acts of Congress otherwise require or provide, shall be regarded as rules of decision in civil actions in the courts of the United States, in cases where they apply.”

2. Rules Enabling Act: 28 U.S.C. §2072:

   1. “(a) The Supreme Court shall have the power to prescribe general rules of practice and procedure and rules of evidence for cases in the United States district courts (including proceedings before magistrate judges thereof) and courts of appeals.

   2. (b) Such rules shall not abridge, enlarge or modify any substantive right. All laws in conflict with such rules shall be of no further force or effect after such rules have taken effect.”

3. Facts: Diversity case about enforcing a bill of exchange.

4. Question: Does federal court, sitting in diversity, apply state or federal common law, as per section 34 of the Judiciary Act of 1789 (what is now §1652)?

5. Held: Federal courts apply state statutory law, but not state common law.

   1. “Laws of the several states” should be interpreted strictly to include ONLY state statutory law, not state common law.

      1. Court decisions are evidence of what the law is, but not the law itself.

   2. Created a “federal common law”

6. Declared unconstitutional by Erie

Key Legislative Elements

Extreme Deference Least Deference

to state law to state law

[ ----------------------------------------------------------------------------------------------- ]

York ODT | Hanna Twin Aims

[Harlan’s Hanna Concurrence]

1. Facts: Tompkins hit by a protrusion on a train, walking on a footpath next to tracks. Case is determined by state or federal trespass (tort) law. (PA Law: Trespasser, no rights. Fed: longitudinal easement.)

2. Question: Should federal courts apply state or general common law?

3. Held: Federal courts should apply state common law.

   1. THRUST: Swift misinterprets Federal Judiciary Act. Cites a recent law professor’s work.

      1. Parry: Law Prof. Charles Warren discovered an earlier draft of the Rules of Decision Act that included “common law now in use.” BUT does this mean the drafters meant to INCLUDE common law OR purposefully EXCLUDE common law? Not so clear.

   2. Thrust: Swift is unconstitutional and must be overturned. There is no federal general common law.

      1. Parry: Not really clear that Swift is actually unconstitutional. (See Justice Reed’s Concurrence.) But needed a stronger argument to get a majority for the opinion?

   3. Example of Black & White Taxi v. Brown & Yellow Taxi (US 1928, in Erie, CB 927)

      1. Thrust: Cab company reincorporated in a different state to circumvent state common law. This is bad, want to avoid this. Example of forum shopping.

      2. Parry: § 1359 might already prevent this: “A district court shall not have jurisdiction of a civil action in which any party, by assignment or otherwise, has been improperly or collusively made or joined to invoke the jurisdiction of such court.”

4. Facts: FRCP 35 (physical/mental exam) conflicts with state law. Judge jave FRCP 37 sanctions when plaintiff refused.

5. Question: Apply FRCP or conflicting state law?

6. Held: FRCP 35 and 37 are procedural, so FRCP applies.

   1. Similar to Hanna and Burlington North

   2. BUT Professor: Isn’t this a substantive right (search and seizure, etc.)? Maybe this is infringing on a state-protected right?

7. Facts: Complicated class action suit brought in diversity. NY statute of limitations had run out. Action barred in state law but not federal law.

8. Question: When right to sue is barred by state law, can suit commence in federal court?

9. Held: No. Since the application of state law “significantly affect[s] the result of a litigation,” should apply state law.

   1. “The source of substantive rights enforced by a federal court under diversity jurisdiction, it cannot be said too often, is the law of the States.”

   2. Creates outcome-determinative test.

   3. Difference between procedure and substantive is not important – just the rights and outcome of the litigation.

10. Problems of York test

    1. FRCP application would be reduced significantly.

    2. E.g., Ragan v. Merchants Transfer & Warehouse (US 1949, CB 942): Complaint was filed in federal court within Kansas’ statute of limitations, but service was made to after the statutory period had run out.

       1. FRCP “civil action commenced by filing a complaint with the court.”

       2. Kansas law: SoL not tolled until actual service.

       3. HELD: State law applicable. No right to sue in state court, so no right to sue in Federal.

11. Recall: State courts do not always apply their own laws.

12. Federal Court Rule: “The conflict of law rule to be applied by the federal court in [a particular state] must conform to those prevailing in [that state’s] courts.” Klaxon v. Stentor Electric Manufacturing Co. (US 1941, CB 945)

13. Facts: Employee gets injured on the job. Dispositive Question: Is he an independent contractor or statutory employee?

    1. State law: Judge determines what kind of employee

    2. Federal: Jury determines what kind of employee

    3. [NOTE: Don’t know if judge or jury would decide the same way or differently – NOT clearly outcome determinative.]

14. Question: Is the requirement of a judge vs. jury decision outcome determinative / enough of a substantial right to enforce state law over federal law?

15. Held: No. The requirement is “merely a form and mode of enforcing the immunity… and not a rule intended to be bound up with the definition of the rights and obligations of the parties.”

    1. Unclear if the outcome would be determined by the decision

    2. Countervailing federal considerations: Seventh Amendment. Applying state law cannot always trump the disruptions to the federal system.

       1. Reads the state law as primarily a thing of convenience, not substantive rights. (Pg 949). Professor: a different story could be told.

    3. “The inquiry here is whether the federal policy favoring jury decisions of disputed fact questions should yield to the state rule in the interest of furthering the objective that the litigation should not come out one way in the federal court and another way in the state court.”

    4. NEW TEST: Balance state vs. federal interests.

16. Facts: Summons left at house according to FRCP 4, but MA law requires...