ERIE FLOWCHART

Intro/umbrella rule
- RDA: “laws of the state” govern in diversity cases
o Means written (statutory) as well as unwritten (decisional)
o So whenever the disputed question is “substantive”, i.e.
bound up with core rights/obligations/elements, then state
law controls
o There is no federal common law

Is the conflict with FRCP (or federal statute)?

- REA: SCOTUS has power to create rules of practice and procedure
o FRCP are those rules it has approved

 if NOT FRCP?
- Go to “unguided Erie”

 if YES
- Direct Conflict/ “On point”?
 if YES, then Fed Rule controls, PERIOD.
 if NO, go to “unguided Erie” test

- What does “direct conflict” mean?

o “sufficiently broad to control the issue” (Walker)
o Direct collision is the Fed rule and state rule attempt to
answer the very same question
 Examples/illustrations
 Passmore, issue of expert report, ct. held that it
would interfere with fed discovery scheme (Rule
26, Rule 37)
 Shady Grove, issue of when class certification is
proper…
  Might depend on how broadly/narrowly you construe
the “question” the Fed rule is seeking to answer
 E.g. Shady Grove dissent
 E.g. Walker (“civil action commences” read not so
broadly as to deal with SOL tolling)

Unguided Erie

1. Is the state rule “substantive”?

a. Substantive rights, “bound up with core rights and
obligations” – i.e., is it an ELEMENT of the state right
i. E.g. simple negligence vs. bad faith/reckless standard
in Erie
b. [NOTE: answer will usually be “no”, i.e., the state rule in
question is likely to be merely a “form or mode of enforcing”
the underlying substantive right rather than the right itself,
i.e. it’s arguably “procedural”]

2. Would ignoring the state rule “substantially affect the outcome” of

the case? [i.e., “outcome determinative” test]
 if NO? can ignore it and apply fed practice
 if YES?
o Usually must apply the state rule, UNLESS countervailing
federal policies outweigh risk of forum shopping/inequitable
administration of law concerns at core of Erie doctrine.

- How to assess outcome determination and risk of forum

shopping/unfairness?
o Ask the Q prospectively (Hanna) at time when faced with
decision about whether to go to federal court
 E.g. in Hanna, even though NOW there would be a
substantial effect on outcome (case dismissed if apply
state rule, vs. green light if ignore it), little risk of forum
 shopping at time deciding where to sue—slightly more
complicated service rule wasn’t enough of an
incentive/doesn’t make availability of federal forum so
“unfair” to those who don’t have that option
 But cf. Byrd re judge/jury – “it may well be …”
 Closer we are to red light/green light scenario, more
likely it is that we’ll need to apply the state rule

- What sorts of federal policies?

o E.g. Byrd, respect for judge/jury difference in fed court,
embodied by Seventh Amendment (we generally prefer
sending factual questions to a jury in fed court)
o Respect for uniform rules of practice and
procedure/recognition that federal court is an entirely
separate system
o Respect for discretion given to federal judges embodied in
FRCP (like Rule 16, 26, etc)
o If we have a FRCP or federal statute directly on point,
allowing fed court to enforce those rules is bigly important
“ARISING OUT OF/RELATED TO” INQUIRY

Address this issue whenever it is potentially relevant

- Looking for scenario where “bad conduct” occurred elsewhere
and/or “injury causing accident” was suffered elsewhere
- But some relevant stuff happened in the forum
- [think e.g. of CA P booking a hotel in HI via CA advertising, then
goes to HI and slip/fall accident in HI]
- [think of Helicopteros scenario – lots of stuff happened in TX, but
helicopter crash in Peru]
- [BMS case - pills ingested elsewhere, but BMS engages in some
general advertising campaign work from CA]

Umbrella rule on PJx

- Traditional/territorial bases
- Contact-based jx with an out of state D
o Extent of contacts needed depends on “arising out of” Q
 Explain Specific vs General
o [if injury-causing conduct by D occurred in the forum state,
then it’s a non-issue and can focus on Specific Jx]
o [if both conduct and injury are elsewhere, then prob will
limit analysis to Gen Jx]

What to say about the “rule”?

- Circuit split
o Proximate cause
o But for
o Something in between
- Tell me what you DO know from the SCOTUS cases (BMS, Walden)