A critical guide to Erie Railroad Co. v. Tompkins.

• Author: Nelson, Caleb
• Position: Introduction through I. The Relationship Between State and Federal Courts Before Erie, p. 921-949

TABLE OF CONTENTS INTRODUCTION I. THE RELATIONSHIP BETWEEN STATE AND FEDERAL COURTS BEFORE ERIE A. The Bottom Line B. Were People Crazy Then? 1. The Nature and Sources of Unwritten Law 2. Who Should Defer to Whom About What? a. Deference on Questions of "Local" Law b. Non-Deference on Questions of "General" Law II. JUSTICE BRANDEIS'S ARGUMENTS IN ERIE A. Justice Brandeis's Historical Argument B. Justice Brandeis's Practical Arguments 1. The Murkiness of the Distinction Between "General" and "Local" Law 2. Disuniformity and Forum Shopping 3. "Discrimination" Against Citizens of the Forum State C. Constitutional Arguments CONCLUSION Introduction

No informed observer has ever been in doubt about the importance of Justice Brandeis's opinion in Erie Railroad Co. v. Tompkins. (1) Almost as soon as it was issued, the cognoscenti were calling it a "transcendently significant opinion," (2) a "thunderclap decision," (3) and "one of the most dramatic episodes in the history of the Supreme Court." (4) Seventy-five years later, Erie remains an "iconic case[]"--one that "every lawyer knows ... by name" and that "is thought to express something basic about the United States legal system." (5) Above and beyond its immediate holding (which is obviously important in its own right), Erie has become the starting point for many modern arguments about federalism and the separation of powers.

Unfortunately, Erie is a shaky foundation for legal reasoning. From the standpoint of technical, lawyerly craftsmanship, Justice Brandeis's opinion has many vices. It relies on contestable premises that it does not make explicit. It delivers grand statements that are misleading in the absence of careful qualification (which it does not supply). Upon close examination, some of the arguments that it endorses fall apart entirely, and others are--at best--much more complicated than it acknowledges. Insofar as it purports to rest on the Constitution, moreover, it advances arguments so cavalierly and impressionistically as to impede responsible analysis. In the words of a contemporaneous student note, "The opinion in Erie Railroad v. Tompkins lacks much of the precision which an important reexamination of constitutional distribution of power might be expected to contain." (6)

None of this means that Erie's bottom line is necessarily wrong. But lawyers and law professors who seek to extend Erie's analysis need to recognize the shoals concealed in Justice Brandeis's opinion. It is easy to overread Erie, and it is also easy to find apparent support in Erie for propositions that are false.

Precisely because Erie is so iconic, of course, it has been analyzed exhaustively. In recent years, revisionist scholars have made great strides in understanding both Erie and what came before Erie. To criticize Justice Brandeis's opinion in light of this new learning is surely unfair. But it is still worth doing, because Erie's status in our legal firmament makes it crucial to understand exactly what Erie held and how that holding might be supported.

Erie addressed one of the recurring questions of American federalism: What is the status in federal court of precedents established by the courts of a particular state? Throughout our history, the answer has depended on what the precedents are about; federal courts have always felt more need to defer to a state's highest court about certain aspects of the state's own law than about the law of other sovereigns. Before Erie, however, federal courts drew the crucial lines in different places than they do now.

As background for analysis of Justice Brandeis's opinion, Part I of this Article provides a brief account of the doctrine that prevailed before Erie. Part II then evaluates each of the main arguments--historical, practical, and constitutional--that Justice Brandeis advanced in support of his claim that federal law required a different doctrine. By and large, the criticisms that I will be advancing are not original to me; although I will be sifting through the voluminous literature about Erie to highlight what I consider to be the key points, most of what I have to say has already been said in one form or another by others. But what this Article lacks in novelty, I hope that it will make up for in utility. While the new learning about Erie is gradually spreading, my sense is that many scholars and most students remain in the grip of outdated understandings. I hope that there is some value in providing a concise assessment of what Justice Brandeis said, what he may have meant, and the extent to which what he said or meant is true.

1. The Relationship Between State and Federal Courts before Erie

Whatever else it did, Erie abandoned what it repeatedly called "the doctrine of Swift v. Tyson." (7) Justice Brandeis is not to blame for that label, which was common in the law-review articles of his day. (8) But the label has the potential to mislead, for it suggests that Justice Story's 1842 opinion in Swift v. Tyson (9) was itself a watershed decision--one that broke dramatically from past understandings of the relationship between state and federal courts. At the time that Brandeis was writing, and for many years thereafter, that was indeed the conventional view of Swift. (10) As modern scholars have shown, however, Swift was continuous with prior practice. (11)

Be that as it may, the doctrine that Erie abandoned was part of a larger set of practices that had many different moving parts and that could be characterized in many different ways. Rather than delving into too many complications at the outset, Part I.A simply summarizes a few important aspects of the bottom line. Before readers can snicker too much at the idiocy of the nineteenth century, Part I.B then discusses why smart people might have drawn the distinctions that this bottom line reflects.

1. The Bottom Line

   To understand the institutional arrangements that prevailed before Erie, one must start with a distinction that no longer matters--the distinction between 'local" and "general" law. The "local" law of a particular state included both its written laws (such as the state constitution and statutes enacted by the state legislature) and at least a portion of its unwritten law (such as rules grounded in peculiar local customs and rules about the status of land and other things with a fixed locality in the state). (12) Some aspects of the unwritten law in force in each state, however, addressed "questions of a more general nature'' (13) and reflected sources that were common to all the states. Jurists of the day referred to this sort of unwritten law as "general" law. (14)

   Within the limits of its legislative competence, each state could enact statutes to handle questions that would otherwise be governed by the unwritten law (whether "local" or "general"). On issues that concededly lay within the state's legislative jurisdiction, moreover, such statutes would apply in federal court no less than in state court. (15) In the words of one early opinion of the Federal Supreme Court, "That the statute law of the States must furnish the rule of decision to this Court, as far as they comport with the constitution of the United States, in all cases arising within the respective States, is a position that no one doubts.'' (16) Similarly, the other aspects of each state's "local" law were also regarded as binding in federal court. In Swift v. Tyson itself, for instance, Justice Story took for granted that not only "the positive statutes of the state" but also "local customs having the force of laws" supplied rules of decision for federal courts. (17)

   On matters governed by the "local" law of a particular state, moreover, federal courts followed the precedents established by the state's highest court about the content of the local law. Thus, if a state's highest court had interpreted one of the state's statutes in a certain way, and if the propriety of that interpretation was no longer an open question in the state's own courts, federal judges ordinarily were supposed to defer to the state court's interpretation (even if they themselves would have read the state statute differently). (18) The same was true for settled decisions of the state's highest court about the content of the "local" portion of the state's unwritten law, such as the local law of real property. (19)

   With respect to questions of "general" law, however, federal judges saw no need to follow precedents established by the courts of any particular state. That was true even when the relevant question (as presented in the case that the federal judges were considering) came within a single state's legislative jurisdiction, and even when the highest court of that state had repeatedly expressed its understanding of the proper answer. (20) To be sure, if the state legislature wanted to do so, it could codify that answer in a statute, which the federal courts would then apply (assuming they agreed that the state did indeed have legislative jurisdiction) (21). But even where the state had this sort of power to override the federal courts' view of the general law, doing so required something like a...