Civil Procedure, A Contemporary Approach-Chapter 5- The Erie Doctrine: State Law in Federal Courts Flashcards
A pedestrian from State B initiated a tort action in State A federal court against a driver for personal injuries he sustained from a collision with the driver’s truck in State A. The pedestrian sought $50,000 in compensatory damages and $1 million in punitive damages.
Assume that in State A there is a statute that requires plaintiffs to have the court’s permission before they can seek punitive damages in their complaints. Federal Rule 8(a) however, the rule governing the content of complaints in federal court, does not require such permission from federal judges and instructs pleaders to include “a demand for the relief sought.” Upon receiving the complaint, the driver responded with a motion to strike the pedestrian’s request for punitive damages because it was made without the court’s permission as required by the State A statute. Must the federal court adhere to the State A rule and require the pedestrian to obtain its permission to seek punitive damages?
No, because Rule 8 applies, it is valid and constitutional, and it permits pleaders to plead whatever relief they seek without the court’s permission.
Explanation: The issue facing the court is whether its permission is needed before a plaintiff may include a demand for punitive damages in her complaint. Rule 8(a) governs the general content of pleadings in federal court and does not require such permission. Fed. R. Civ. Pro. 8(a)(2), (3). Thus, so long as Rule 8(a) is valid and constitutional, it governs. Rule 8(a) is valid under the Rules Enabling Act because it does not entitle pleaders to punitive damages; rather, it merely permits pleaders to ask for them. Rules of pleading concern what occurs within the judicial process, making them procedural and thus constitutional. As a result, Rule 8(a) governs and may be applied without regard to the state rule. Hanna v. Plumer, 380 U.S. 460 (1965).
A pedestrian from State B initiated a tort action in State A federal court against a driver for personal injuries he sustained as a result of a collision with the driver’s truck in State A. The pedestrian sought $50,000 in compensatory damages and $1 million in punitive damages.
Assume State A has a statute that caps all punitive damages awards at $50,000. Federal Rule 8(a) however, the rule governing the content of complaints in federal court, does not include such a cap and permits pleaders to include “a demand for the relief sought.”
Must the federal court limit any punitive damages award in this case to $50,000 pursuant to State A’s punitive damages cap?
Yes, because Rule 8 does not apply, and ignoring the State A statute would encourage forum shopping and result in the inequitable administration of the law as well as undercut state interests.
Explanation: The issue facing the court is the amount of punitive damages the pedestrian is potentially entitled to recover. Rule 8 does not provide the legal foundation for an entitlement to punitive damages, leading to an Erie analysis. Prospective litigants would forum shop based on this difference were the cap ignored in federal court, and ignoring the cap would result in the inequitable administration of the law since non-diverse litigants could not access the rule. Thus, the state cap must be honored for state law claims. Hanna v. Plumer, 380 U.S. 460 (1965); Erie R.R. Co. v. Tompkins, 304 U.S. 64 (1938).
A pedestrian from State B initiated a tort action in State A federal court against an out-of-state driver for personal injuries sustained as a result of a collision with the driver’s truck in State A. The pedestrian sought $150,000 in compensatory damages and demanded a jury in the complaint.
Assume that in State A there is a statute that requires judges to decide whether a person is a pedestrian or a motorist; in the incident underlying this lawsuit, the pedestrian was riding a “hoverboard,” a mechanized platform with wheels that permits its user to roll along terrain without walking. Ordinarily, a federal court would permit the jury to resolve this issue as a mixed question of law and fact.
Must the federal court follow State A law and rest this determination with the judge?
No, because the federal interest in resolving such questions by juries outweighs the interests favoring application of the conflicting state legal rule.
Explanation: Although the twin aims of Erie might be implicated by ignoring State A’s “judge-decides” legal rule in federal court, the federal interest under the Seventh Amendment in resolving such questions by juries outweighs those concerns. Byrd v. Blue Ridge Rural Elec. Co-op., Inc., 356 U.S. 525 (1958); Erie R.R. Co. v. Tompkins, 304 U.S. 64 (1938).
A shopkeeper in State A sold some bread to a customer from State B who was visiting the shopkeeper’s store. That afternoon, the customer ate the bread and became extremely ill. Eleven months after falling ill, the customer filed a tort action in State A federal court against the shopkeeper, seeking $80,000 in damages. Service of process in this case was achieved two months later.
State A has a one-year statute of limitations period for such claims and requires commencement of the action within that period of time. The State A statute defines “commencement” as having both filed and achieved service of process within the one-year period. However, although there is no federal statute of limitations period that applies to this state law tort, Rule 3 of the Federal Rules of Civil Procedure indicates that an action is commenced once the action is filed. Further, Rule 4(m) gives plaintiffs 90 days to achieve service of process after filing a complaint.
The shopkeeper moved to dismiss the action as untimely for having failed to satisfy the applicable statute of limitations period. How should the court rule on this motion?
Grant the motion, because the shopkeeper was not served within the one-year period called for under State A law, which must be followed because ignoring it would promote forum shopping and the inequitable administration of the law.
Explanation: Although Rule 3 declares an action to be commenced upon filing—which in this instance occurred within one year of the incident—Rule 3 is not a rule that governs the tolling (stopping) of state statute of limitations periods. Because Rule 3 is inapplicable to this issue, the court must perform an Erie analysis to determine whether it must apply State A’s requirement for service within the statute of limitations period. Ignoring State A’s statute would promote forum shopping and the inequitable administration of the law through the resulting differential in timeliness deadlines. Thus, the twin aims of Erie are implicated and there is no countervailing federal interest, the State A statute (which requires both filing and service of process within the period) must be applied. Walker v. Armco Steel Corp., 446 U.S. 740 (1980); Ragan v. Merchants Transfer & Warehouse Co., 337 U.S. 530 (1949).
A shareholder filed, in State A federal court, a federal securities fraud action under the Securities and Exchange Act against a corporation based on a dramatic decline in the price of its stock. Assume that under a State A statute, judges must adjudicate all fraud claims without the aid of a jury, whereas in federal court either party would be entitled to demand a jury trial for such claims.
Must the federal court follow State A’s judge-decides statute in this case?
No, because the securities fraud claim is created by federal law.
Explanation: There is no need to reconcile conflicts between federal and state law when the underlying claim is based on federal law. Wright, Miller & Cooper, 19 Fed. Prac. & Proc. Juris. § 4525 (3d ed.); Maternally Yours v. Your Maternity Shop, 234 F.2d 538, 540–41 n.1 (1956) (“[T]he Erie doctrine is inapplicable to claims or issues created and governed by federal law.”).
A plumber from State A filed a diversity action in State A federal court against contractor from State B for damages arising from an alleged breach of contract for failure to pay the plumber for work. Assume under State A law, defendants must be notified of suits personally through in-hand service of process. State B law requires service of process through certified mail. Federal Rule 4 permits in-hand service of process but also permits service at the dwelling of a defendant on a person of suitable age who resides there, as well as service consistent with the law of the state where the action is pending or service is made.
The plumber served process on the contractor by delivering it to his wife at their home in State B. The contractor responded by moving to quash service of process on the ground that it did not comply with the requirements for service of process in State A. How should the court rule on the motion?
Deny it, because service was made in compliance with Rule 4.
Explanation: Rule 4 applies to the issue (the proper method of service) and is valid and constitutional. Nothing in Rule 4 alters the substantive rights of defendants and the rule strictly concerns the judicial process, not the rights and obligations of people in society. Hanna v. Plumer, 380 U.S. 460 (1965). Here, service was consistent with a method approved by Rule 4; thus, the motion to quash service of process should be denied.
A courier filed a diversity action in State A federal court against XYZ Corp. for damages arising from an alleged breach of contract for failure to pay a fee he earned delivering packages for XYZ. Assume under State A law that the courier—if successful—would be automatically entitled to postjudgment interest at a rate of 6% from the date of entry of the judgment. However, 28 U.S.C. § 1961 provides that the postjudgment interest should be paid “at a rate equal to the weekly average 1-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System, for the calendar week preceding.” In recent years, that rate has averaged well below one percent.
Must the federal court follow the State A postjudgment interest law?
No, because there is a federal statute covering this issue and that statute is constitutional.
Explanation: The cited statute, 28 U.S.C. § 1961, expressly provides for postjudgment interest. Because there is a direct conflict between the state and federal statutes, a Hanna analysis is required. The statute is constitutional because it relates to the judicial process—the accrual of interest on federal court judgments prior to their satisfaction. Weitz Co. v. Mo-Kan Carpet, Inc., 723 F.2d 1382, 1386 (8th Cir. 1983) (“We believe that the new federal interest statute is constitutional and therefore governs the award of post-judgment interest in this case.”). See also 28 U.S.C. § 1961(a); Schipani v. McLeod, 541 F.3d 158, 164–65 (2d Cir. 2008) (“[P]ostjudgment interest is governed by federal statute.”); Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22 (1988); Hanna v. Plumer 380 U.S. 460 (1965).
A visitor to a private museum in State A (owned by a company that is incorporated and has its principal place of business State B) slipped and fell to the ground, becoming injured as a result. The visitor initiated a lawsuit against the museum in State A state court seeking $100,000 in damages. The museum promptly removed the case to State A federal court. The museum then moved to dismiss the complaint, arguing that the complaint did not meet State A’s stringent fact pleading standard. The visitor responded by arguing that the pleading standard of Federal Rule 8 applied to the complaint, not the State A standard.
Which pleading standard must the court apply to the complaint in this case?
The Rule 8 standard, because the rule applies to this issue and is valid and constitutional.
Explanation: Because there is a direct conflict between State A pleading standards and pleading under the Federal Rules, one must engage in a Hanna analysis to determine whether Rule 8 must be followed. Rule 8(a) sets the applicable standard for pleadings in federal court. Thus, so long as it is valid and constitutional, it governs. Rule 8(a) is valid under the Rules Enabling Act because it merely requires an articulation of the basis for relief, rather than setting forth the actual standards for entitlement to relief. Rules of pleading are only operable within the judicial process, making them procedural and thus constitutional, meaning that the rule must be followed. Hanna v. Plumer, 380 U.S. 460 (1965).
A consumer filed a products liability diversity action against a brake pad manufacturer in State A federal court. He filed the action as coplaintiff with another consumer who also asserted a products liability claim against the same manufacturer.
Assume that under a State A statute multiple plaintiffs may not join in a single action to assert products liability claims. Further assume that this statute was passed because the state legislature wanted to reduce the number of products liability claims in the state. However, under Rule 20 of the Federal Rules of Civil Procedure, multiple plaintiffs may join in a single action if their claims arise out of the same transaction or occurrence, or series of transactions and occurrences, and share a common question of law or fact.
Which law must the court follow to determine whether the plaintiffs may proceed jointly in this action?
Rule 20, because it applies to this issue and it is valid and constitutional.
Explanation: There is a direct conflict between State A’s statute and an applicable Federal Rule on the issue of the parties’ ability to join other parties in a civil action, which requires analysis under Hanna. Specifically, Rule 20 applies to the issue of when multiple parties may assert claims within the same action. Rule 20 does not abridge, enlarge, or modify any substantive rights because it does not expand or contract a plaintiff’s substantive entitlement to recover under State A’s products liability law. It is constitutional because it addresses joinder of parties in a judicial proceeding, a procedural matter. Thus, the Federal Rule must be followed here. Shady Grove Orthopedic Associates, P.A. v. Allstate Ins. Co., 559 U.S. 393 (2010) (opinion of Scalia, J.); Hanna v. Plumer, 380 U.S. 460 (1965).
ABC, a State A corporation, filed a breach of contract action against XYZ in State A federal court. The contract between ABC and XYZ had a forum-selection clause providing that “all disputes arising under this contract must be litigated in State B.” Citing this forum selection clause, XYZ filed a motion to transfer the case to the District of State B.
Assume that under State A law, such forum-selection clauses are void as against public policy and thus unenforceable. Must the State A federal court follow State A law concerning forum selection clauses in deciding the transfer motion, which would require that the forum-selection clause be disregarded?
No, because there is a federal statute governing transfer that applies and is constitutional.
Explanation: 28 U.S.C. § 1404(a) is directly on point and covers the issue of whether a case may be transferred from one federal district to another. It is constitutional, because the transfer of actions between federal district courts is a procedural concern. Thus, the statute must be applied, which calls for enforcing the agreement of the parties regarding the proper venue. Atlantic Marine Constr. Co., Inc. v. U.S. Dist. Court for W. Dist. of Tx., 571 U.S. 49 (2013); Stewart Organization, Inc. v. Ricoh Corp., 487 U.S. 22 (1988); Hanna v. Plumer, 380 U.S. 460 (1965). Because the clause embraces litigation in any court located in State B, it must be transferred to a federal court there.
A passenger on bus driving through State A was severely injured when the bus crashed after the driver of the bus fell asleep. The passenger initiated a state law tort action against the driver and the bus company in State A state court, seeking damages for medical expenses and pain and suffering. The passenger alleged that the driver and bus company were liable for recklessness in light of the long shifts and limited opportunities for sleep given to the driver. The bus company promptly removed the case to State A federal court.
State A law provides that in personal injury cases where recklessness or intentional wrongdoing is established, the prevailing claimant is entitled to an award of attorney’s fees. Title 28 U.S.C. § 1920 is a federal statute that covers taxation of costs but it omits any reference to attorney’s fees; no other federal statute generally provides for the award of attorney’s fees to all victors in federal court. Must the federal court apply the State A attorney’s fees provision in the event that the passenger is able to prove recklessness and prevail in this action?
Yes, because there is no Federal Rule or statute addressing attorney’s fees in this context and ignoring the State A law would result in forum shopping and inequitable administration of the law.
Explanation: Because no Federal Rule or statute covers this issue, an Erie analysis is warranted. Were federal courts to ignore the State A attorney’s fees law, varying outcomes in awards would result, something that would be likely to cause litigants to forum shop and would be unfair to those who could not access the State A law (such as plaintiffs in State A courts whose claims are removed to federal court). Hanna v. Plumer, 380 U.S. 460 (1965); Erie R.R. Co. v. Tompkins, 304 U.S. 64 (1938). Because the twin aims of Erie are implicated, the federal court must apply the State A attorney’s fee provision in this case.
An employer incorporated in State A fired an employee (a citizen of State B) for allegedly embezzling funds from the employer. The employee, believing that the embezzlement allegation was a pretext for a firing that was actually based on the employee’s age, initiated an action in State A federal court for wrongful termination under State A law. In addition to this claim, the employee asserted a claim seeking compensation for physical injuries sustained while working for the employer.
The employer filed a motion to dismiss the employee’s claim for failure to state a claim, arguing that under State A law employee compensation claims had to be resolved in the State A administrative workers’ compensation system. Assume that the employer is correct in its argument that were this claim filed in state court it would be dismissed to be heard by the State A Workers’ Compensation Board.
Must the federal court follow State A law and dismiss the employee’s compensation claim?
Yes, because permitting a federal court to award damages for such a claim when State A courts would not would result in forum shopping and inequitable administration of the law.
Explanation: The difference between going through an administrative worker’s compensation system and having access to a jury verdict in federal court is sufficiently consequential to cause forum shopping and lead to inequitable results. Thus, the federal court must yield to the State A law (there is no countervailing federal substantive policy interest). Hanna v. Plumer, 380 U.S. 460 (1965); Erie R.R. Co. v. Tompkins, 304 U.S. 64 (1938). See also Feinstein v. Massachusetts Gen. Hosp., 643 F.2d 880, 888 (1st Cir. 1981) (stating that Erie policies requiring adherence to state door-closing statutes also require a federal court to apply state-created limitations on a plaintiff’s right to recovery) (citing Woods v. Interstate Realty Co., 337 U.S. 535 (1949)).
A doctor prescribed a medication to a patient to manage the patient’s breathing problems. Unfortunately, the prescribed medication was inappropriate for the patient in light of an allergy of the patient, which resulted in the patient going into a coma and suffering mild brain damage.
The patient initiated a medical malpractice suit against the doctor in State A federal court, seeking monetary damages. State A law provides that all medical malpractice claims must be accompanied with an affidavit of merit, signed by a licensed physician who attests to the merit of the claims asserted in the lawsuit. Failure to include the form results in a dismissal. In federal court, however, there is no such requirement.
The patient filed the complaint in federal court without an affidavit of merit as is required under State A law. Must the federal court enforce the State A affidavit of merit requirement?
No, because the Federal Rules of Civil Procedure permit the filing of a complaint without an accompanying affidavit of merit.
Explanation: The Federal Rules of Civil Procedure contain no heightened pleading requirements for medical malpractice cases. In cases where no heightened pleading is required by the Federal Rules (i.e., the matter is not covered by Rule 9 or another applicable rule), the Supreme Court has held that the complaint “must satisfy only the simple requirements of Rule 8(a).” Swierkiewicz v. Sorema N. A., 534 U.S. 506, 513 (2002). Because the general pleading standard of Rule 8 applies to the issue, it must be followed as long as it is valid and constitutional. Hanna v. Plumer, 380 U.S. 460 (1965). Nothing in Rule 8(a) alters the substantive rights of the parties nor does the rule concern anything beyond mere judicial procedure (the standards for pleading one’s case in court). Shady Grove Orthopedic Assocs., P.A. v. Allstate Ins. Co., 559 U.S. 393, 421 (2010) (plurality opinion of Scalia, J.). Thus, the rule must be applied to exclude any affidavit of merit requirement under State A’s law. See, e.g., McKinley v. United States, No. 5L15-CV-101, 2015 WL 5842626, at *9 (M.D. Ga. Oct. 6, 2015). Note: Some courts disagree with this analysis, finding that no direct conflict exists between the state law and Federal Rules, and applying an Erie analysis to conclude that the state law must be applied under these circumstances. See, e.g., Chamberlain v. Giampapa, 210 F.3d 154, 158–61 (3d Cir. 2000). The Supreme Court has not directly addressed this precise issue, and a circuit split appears to exist.
