Erie Railroad v. Tompkins: Why Federal Courts Follow State Law

Tompkins was walking along a railroad right-of-way in Pennsylvania when he was struck by something protruding from a passing Erie Railroad train. He sued in federal court in New York based on diversity jurisdiction. The key question: should the federal court apply Pennsylvania state law (which would have barred his claim as a trespasser) or federal general common law (which was more favorable to him)?

Under Swift v. Tyson (1842), federal courts sitting in diversity applied state statutory law but developed their own federal common law for non-statutory issues. This created forum shopping: if state common law was unfavorable, a diverse plaintiff could simply file in federal court and get more favorable federal common law instead. This was exactly what Tompkins did.

Justice Brandeis overruled Swift v. Tyson and held that there is no general federal common law. Federal courts sitting in diversity must apply state law — both statutory and common law — on substantive issues. The Constitution does not give federal courts the power to create a separate body of substantive law that differs from the law of the state where they sit.

Erie is one of the most important cases in American law. It established that state law governs substantive rights in diversity cases, eliminated the worst forms of forum shopping, and launched the “Erie doctrine” — a framework for determining whether a particular issue is governed by state or federal law. Every Civ Pro course dedicates significant time to the Erie line of cases (Guaranty Trust, Hanna, Gasperini, Shady Grove).