One of us was recently on a conference call discussing possible federal rules amendments (no, not e-discovery), and concern was raised about federal judges making up new grounds for liability in cases based on state law, a problem that several speakers complained was particularly widespread in class actions.
We’ve seen that in drug/device cases as well, particularly but hardly exclusively in cases involving preemption, where judges run roughshod over state law in support of novel theories of liability. Most of the posts under our Erie Doctrine topic header concern this problem.
The consensus on the call was that, while a serious problem, judicial expansion of state tort law in diversity jurisdiction cases is a substantive issue ill-suited to solving by a federal rules change. But it occurs to us that it could be addressed by a federal statute, since Congress may legislate concerning the powers of the federal judiciary, to the extent that those powers are not set by the Constitution. The venerable Anti-Injunction Act, 28 U.S.C. §2283, is one example of such legislation that springs readily to mind.
So we offer the following, which could be called the “Federal Respect for State Law Act,” or some such euphemism:
In any action pending in any court of the United States, to the extent that subject matter jurisdiction exists or is claimed under 28 U.S.C. §1332 (diversity of citizenship), no court shall recognize a theory of civil liability, including civil liability asserted in opposition to a fraudulent joinder argument, unless there exists in the State or States in question, statutory or appellate judicial authority expressly recognizing that theory of civil liability.
That’s short and sweet, and to the extent that federal judges are inclined to follow the law at all, they should be inclined to follow something like this.
We’re bloggers, not a lobbying organization. We’re happy to offer our idea free of charge to any pro-defense organization, such as the Chamber of Commerce or the American Tort Reform Association, that does engage in tort-related lobbying in Congress.
We wish that such a statute were not necessary, but the unfortunate fact remains that, despite decisions by the Supreme Court and by all twelve federal courts of appeals (see here) that decide diversity matters, the existing Erie principle that courts should not predict expansions of state-law liability is all too often ignored whenever federal courts are inclined to do so.