What is the Erie Doctrine?

The “Erie Doctrine,” named after the Supreme Court case Erie Railroad Co. v. Tompkins (1938), a landmark decision by the Supreme Court of the United States in which the Court held that federal courts did not have the judicial power to create general federal common law when hearing state law claims under diversity jurisdiction. In reaching this holding, the Court overturned almost a century of federal civil procedure case law, and established the foundation of what remains the modern law of diversity jurisdiction as it applies to United States federal courts.

If a federal court is hearing a case that deals with a state law issue, it should apply the state’s substantive law, rather than relying on “federal common law.”  When making civil procedure decisions, however, the federal court may use the Federal Rules of Civil Procedure instead of the state’s rules.

A friend of Harry Tompkins had driven him to within a few blocks of his home, which was located on a dead-end street near the Erie Railroad's Erie and Wyoming Valley Railroad tracks in Hughestown, Pennsylvania. Tomkins was walking on a narrow but well-worn footpath adjacent to the tracks at 2:30 a.m. on July 27, 1934. A train approached in the darkness, and an object protruding from one of the cars struck Tompkins. When he fell to the ground, his right arm was crushed beneath the wheels of the train.

Tompkins sued the railroad company in the United States District Court for the Southern District of New York. The district court, following the federal law, applied neither New York nor Pennsylvania common law, but instead applied federal common law, which applied an 'ordinary negligence' standard instead of 'wanton negligence' in determining the duty of care owed to persons not employed by the railroad or otherwise acting in the course of their employment walking along railroad tracks. 

Tompkins won and was awarded damages. The railroad appealed and the U.S. Supreme Court overturned Tompkins' victory and required the lower court to apply the state law rather than federal.

Usually, federal courts hear cases involving federal law, and state courts hear cases involving state law.  However, when the plaintiffs in a case are from different states than every one of the defendants in the same case, the parties may decide to file the case in federal court on the basis of diversity jurisdiction.  The federal court may hear these types of cases, even if no federal law is involved, because no two opposing parties are from the same state.  (If one plaintiff and one defendant were from the same state, the case should be filed in state court in that state, even if the remaining parties have no contact with that state at all.)

Under the Erie Doctrine, a federal court hearing a case based on state law must apply the state law to the case, unless some federal Constitutional provision or statute expressly preempts state law.  (For instance, automotive products liability cases are governed by the Federal Motor Vehicle Safety Standards (FMVSS).)

Courts trying to figure out which law to apply are expected to follow the Rules of Decision Act (RDA), which states that “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.”

Put more simply, the RDA requires courts to ask: Is the issue in the case covered by the U.S. Constitution, a federal treaty, or a federal statute that preempts state law?  If “yes,” federal law applies.  If “no,” state law applies.

This rule applies to substantive law, or law that deals with the merits of a case.  For instance, state laws about negligence or premises liability are substantive laws.  Different rules apply to procedural laws, or rules that govern how a court case is carried out.  When deciding which procedural rules to apply, courts are expected to ask questions like:

  • Is the federal procedural rule based on common law?  If so, the court should consider carefully whether the federal and state rules conflict, and the risks versus the benefits of applying the federal rule instead of the state one.
  • Is the federal procedural rule part of the Federal Rules of Civil Procedure?  If so, the court should use the Federal Rules of Civil Procedure if federal and state procedural rules conflict.  (If they are the same, the effect of applying either one should be the same.)
  • Is the federal procedural rule based on a law passed by Congress?  If so, the court may apply it as long as the statute that created it is constitutional and the statute itself is “on point,” or relevant to the issue the court is trying to resolve.

A court that must apply state substantive law under the Erie Doctrine often finds that it’s facing a state law that is ambiguous, confusing, or possibly unconstitutional, either under the federal or the state Constitution.  Normally, a court facing a law like this interprets the law to the best of its ability.  However, to avoid stepping on the toes of state courts when possible, federal courts applying an ambiguous state substantive law don’t have to interpret the state law.  Instead, they may abstain, send the case to the state’s supreme court, or try to predict, based on legal research, how the state supreme court would decide the issue.The Erie Doctrine is a particular issue in situations where diversity jurisdiction applies or in class action suits, especially those that are consolidated under multidistrict litigation.  When these issues come into play along with the Erie Doctrine, courts can find themselves facing very complex questions about jurisdiction and choice of law.

Reprinted with permission under license from the Rottenstein Law Group LLC, some edits have been made to the original article.

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