The twin aims of Erie.

Author:Green, Michael Steven
Position:III. The Twin Aims Outside Diversity through Conclusion, with footnotes, p. 1904-1937
 
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  1. THE TWIN AIMS OUTSIDE DIVERSITY

To sum up, I have sought to justify the role the twin aims play in diversity cases in terms of federal policies grounded in the diversity statute. The question remains whether they play a role outside of diversity. Because the twin aims have their source in federal jurisdictional policies, not concerns about state interests, there is no reason to think that they must apply simply because a federal court entertains a state law cause of action. The question must be answered on the basis of the statute giving the federal court jurisdiction. Conversely, one cannot conclude that the twin aims do not apply to a federal court simply because it entertains a federal cause of action, for the federal jurisdictional policies in the statute giving the federal court jurisdiction might implicate the twin aims. It is now time to consider these matters.

  1. Federal Causes of Action

    The Supreme Court has held that federal courts have no duty to ensure uniformity with forum state procedure when the plaintiff sues under federal law. (177) For example, a federal court entertaining a federal cause of action calculates prejudgment interest according to a uniform federal common law rule, (178) even though a federal court sitting in diversity must borrow the method that would be used by a forum state court. (179) Likewise, in Semtek the Supreme Court made it clear that the claim-preclusive effect of a dismissal by a federal court of a federal cause of action is governed by a uniform federal common law rule, (180) even though the claim-preclusive effect of a dismissal of a state law action by a federal court sitting in diversity should be borrowed from forum state law. (181)

    Similarly, a federal court entertaining an action under a federal statute that lacks a limitations period has no duty under the twin aims to incorporate the forum state's period into a federal common law rule. (182) To be sure, federal courts find such incorporation convenient. (183) Furthermore, since Congress can be understood to have omitted a limitations period with this federal judicial practice in mind, there is arguably a presumption in favor of such borrowing, a presumption that must be overcome by some significant federal interest. (184) But the reason for borrowing is not the twin aims--that is, the desire for uniformity with how a forum state court would treat the federal action. Concern with a forum state court's treatment of the federal action is entirely absent.

    The inapplicability of the twin aims in federal question actions is sometimes justified on the ground that states lack any interest in their rules applying in federal court in such cases. (185) But such a justification presumes that the twin aims are connected to Erie's goal of respect for state lawmaking power, which we now know to be false. The issue is not state interests, but the federal interests standing behind the statute giving federal courts jurisdiction. So the question remains: Why isn't uniformity with forum state procedure recommended by the federal question statute?

    1. Federal Question Jurisdiction

      To answer this question, we must look to the purposes of federal question jurisdiction. (186) Three are usually offered: 1) federal judges are more experienced in federal law and so are more likely to apply it correctly; 2) federal courts are necessary to enforce the supremacy of federal law against a possibly hostile state judiciary; and 3) lower federal courts are needed, in addition to the Supreme Court, to resolve any disuniformity that results from state court interpretation of federal law. (187)

      Can we generate an argument that the twin aims apply in federal question actions on the basis of these purposes? If state courts were understood as the primary fora for federal causes of action, with federal question jurisdiction created solely to address the problem of state courts' incompetent, hostile, or disuniform interpretation of federal law, one might argue that Congress limited federal courts' power to create procedural common law by the twin aims. (188) Under this reading, Congress gave federal courts' power over federal causes of action for the narrow purpose of addressing these deficiencies with state courts. This was not a license to create procedural common law to serve other federal interests.

      No one has ever suggested that federal courts entertaining federal causes of action are bound by the twin aims in this manner. Why not? The reason must be that everyone assumes that Congress did not consider state courts as the presumptive fora for federal causes of action. Instead, it conceived of federal courts' relationship to federal causes of action as analogous to the relationship that state courts have to state causes of action. Federal courts do not entertain federal causes of action solely to avoid incompetent, hostile, or disuniform interpretation of federal law by state courts. They have a more fundamental entitlement to entertain actions under federal law, an entitlement that carries with it the power to create procedure to vindicate any legitimate federal interest.

      The idea that federal courts are not subsidiary fora for federal causes of action is arguably evident in the ratification debates. As Madison noted, no one was uncomfortable about federal question jurisdiction: "With respect to the laws of the Union, it is so necessary and expedient that the judicial power should correspond with the legislative, that it has not been objected to." (189) William R. Davie expressed the same view: "I thought, if there were any political axiom under the sun, it must be, that the judicial power ought to be coextensive with the legislative. The federal government ought to possess the means of canting the laws into execution." (190) Granted, these statements might be understood as expressing the view that federal question jurisdiction exists for a narrow purpose only, namely to enforce the supremacy of federal law against unwilling states. So understood, federal courts' power over procedure might be limited by this purpose. But there appears to be a more basic notion at work, one tied to the idea that the judicial power should be coextensive with the legislative. A court has a fundamental entitlement to apply the law of its own sovereign. Just as a Pennsylvania court is entitled to entertain Pennsylvania causes of action, a federal court is entitled to entertain federal causes of action. This is a reason to give federal courts jurisdiction over federal causes of action even if state courts interpreted and enforced federal law ably, willingly, and with perfect uniformity. It follows from this entitlement that a federal court entertaining a federal cause of action should have the power to create procedural law to effectuate any forum purpose, just as state courts do when entertaining actions under their own law.

      Of course, the force of this entitlement should not be exaggerated, for federal question jurisdiction did not generally exist in the lower federal courts for almost a century. As we shall see, this is some evidence that state and federal courts were conceived of as coequal fora for federal causes of action. But it is not likely that when Congress created federal question jurisdiction in 1875, it conceived of federal courts as subsidiary to state courts. It intended federal courts to have procedural power unrestricted by the twin aims.

    2. Reverse-Erie

      Having come to the conclusion that everyone has assumed--that the twin aims do not bind a federal court entertaining a federal cause of action--we must now address the more difficult question of whether they bind a state court entertaining a federal cause of action. This requires us to consider the purposes for which Congress retained concurrent state court jurisdiction for federal causes of action.

      Arguments for a reverse-twin aims approach, under which state courts borrow federal procedure, are based on the notion that federal courts are the presumptive fora for federal causes of action, and state court jurisdiction is derivative--existing to overcome some deficiency with exclusive federal jurisdiction. Tasked with accepting jurisdiction to satisfy this purpose, state courts are obligated to regulate their procedure accordingly.

      Assume, for example, that Congress understood federal courts as the presumptive fora for federal causes of action, but retained concurrent state court jurisdiction to keep the federal docket from being overwhelmed or because it wanted to protect some interest of the parties in having a choice between a state and federal forum for their federal dispute. Given these purposes, state courts would have an obligation to borrow federal procedure. If there were a significant difference between state and federal procedure, forum shopping would frustrate the federal purposes standing behind the grant of concurrent state court jurisdiction. For example, if Congress gave state courts jurisdiction over federal actions to relieve pressure on the federal docket, procedural disuniformity would frustrate this purpose because parties disfavored by state procedure would choose the federal forum, flooding the federal courts. Or if Congress gave state courts jurisdiction to protect the parties' discretion to choose between a federal and state court, a difference between federal and state procedure would restrict this freedom of choice.

      What is more, even if forum shopping is set aside, the second of the twin aims would apply. We are assuming that Congress gave state courts jurisdiction over federal causes of action solely to address a problem with the presumptive federal forum. It would not follow from this limited grant of jurisdiction that state courts had the procedural power they have when entertaining causes of action under their own or sister state law.

      But a very different theory of state court jurisdiction for federal actions is possible. Congress may have retained such...

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