28 U.S.C. § 1652: Rules of Decision Act: "the laws of the several states," except where Constitution or Acts of Congress otherwise require/provide, shall be regarded as rules of decisions in civil actions in federal courts, in cases where they apply.
- Swift had interpreted "the laws of the several states" to mean state statutes, but not common law (unless local common law about local matter)
- Erie changed this interpretation to include state common law too.
- Swift decision did not create uniformity in application of laws, as it had been intended.
- Tended to encourage "forum shopping," as πs looked for a more favorable federal forum in which to file suit.
- So a NY federal court more likely to apply NY-style law, since under Swift the judge can choose the law to apply (goal to find "best" common law to apply).
- Erie recognized that statute is not superior to judge-made law: judicial opinion is more than just clarification of the reason in statutes.
- Also, since Congress can't make substantive state law, federal courts shouldn't be able to either.
- But with broad interpretation of Commerce Clause, Congress now can make many laws they couldn't before... so why can't the federal courts do the same?
- Federal diversity supposed to avoid bias against non-citizen, not to favor them.
