Procedure, substance, and erie

Vanderbilt Law Review

Volumn 64, Issue 3, 2011, Pages 877-924

  Tidmarsh, Jay ^a  

^a NOTRE DAME LAW SCHOOL   (United States)

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EID: 79960022607     PISSN: 00422533     EISSN: None     Source Type: Journal    
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References (276)

1. Shady Grove Orthopedic Assoes., P.A. v. Allstate Ins. Co., 130 S. Ct. 1431 (2010).
2. See Shady Grove, 130 S. Ct. at 1442 (plurality opinion) (The test is not whether the rule affects a litigant's substantive rights; most procedural rules do.");
3. id. at 1455, 1459 n.18 (Stevens, J., concurring in part and in the judgment);
4. id. at 1471-72 n.13 (Ginsburg, J., dissenting).
5. Erie R.R. v. Tompkins, 304 U.S. 64, 78 (1938). The Erie rule has also applied to statelaw claims brought into federal court by means of supplemental jurisdiction.
6. See, e.g., Crowe v. Wiltel Commc'ns Sys., 103 F.3d 897, 899 (9th Cir. 1996) (holding that Nevada law applied in a defamation claim being heard under supplemental jurisdiction). For the sake of simplicity, however, I refer to the application of the Erie doctrine only in diversity cases.
7. 28 U.S.C. §2072(b) (2006). Scholars have often noted a curious juxtaposition of events: The Rules Enabling Act, originally enacted in 1934,
8. see Act of June 19, 1934, Pub. L. No. 73-415, 48 Stat. 1064 (codified as amended at 28 U.S.C. §§2071-77 (2006)), resulted in the Supreme Court's promulgation of the Federal Rules of Civil Procedure on December 20, 1937,
9. see Order of December 20, 1937, 302 U.S. 783 (1937), about four months before Erie was decided. Justice Brandeis, who authored Erie, was the only Justice who did "not approve of the adoption of the Rules." 302 U.S. at 783.
10. For instance, the Court's last Rules Enabling Act/"procedural Erie" case before Shady Grove was Gasperini v. Center for Humanities, Inc., 518 U.S. 415 (1996), in which Justice Ginsburg wrote the majority opinion and Justice Scalia dissented-both stating views that they essentially replicated in Shady Grove. The major cases before Gasperini reflect comparable zigs and zags. The litany of the Rules Enabling Act/"procedural Erie" cases that first-year law students can recite-Sibbach v. Wilson & Co., 312 U.S. 1 (1941);
11. Guaranty Trust Co. v. York, 326 U.S. 99 (1945);
12. Ragan v. Merchants Transfer & Warehouse Co., 337 U.S. 530 (1949);
13. Byrd v. Blue Ridge Rural Electric Coop., Inc., 356 U.S. 525 (1958);
14. Hanna v. Plumer, 380 U.S. 460 (1965);
15. Walker v. Armco Steel Corp., 446 U.S. 740 (1980);
16. and Business Guides, Inc. v. Chromatic Communications Enterprises, Inc., 498 U.S. 533 (1991) - is enough to prove the point.
17. 380 U.S. 460 (1965).
18. John Hart Ely, The Irrepressible Myth of Erie, 87 HARV. L. REV. 693 (1974).
19. Id. at 468, 470.
20. In the Rules Enabling Act/"procedural Erie" context, the critical first question is whether a Federal Rule of Civil Procedure "is sufficiently broad to control the issue before the Court." Walker, 446 U.S. at 749-50. When there is a "direct collision" between a Federal Rule and a state rule, then the Rules Enabling Act analysis comes into play; but if there is no conflict, then the "procedural Erie" analysis comes into play.
21. See Hanna, 380 U.S. at 470-72. Once that issue is resolved, then there is the second-level characterization question: in Enabling Act cases, whether the Federal Rule is a rule of "procedure,"
22. see Shady Grove Orthopedic Assoes., P.A. v. Allstate Ins. Co., 130 S. Ct. 1431, 1442-44 (2010);
23. and in "procedural Erie" cases, whether the federal rule "would invite forum-shopping and yield markedly disparate litigation outcomes,"
24. see id. at 1461 (Ginsburg, J., dissenting). Characterization problems are common in choice-of-law analysis. One of the most difficult characterization issues in horizontal (i.e., state-to-state) choice-of-law analysis is whether an issue is "substantive" or "procedural." If it is substantive, then constitutional and doctrinal rules constrain a forum court's ability to choose its own law.
25. See Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 799 (1985) (discussing full-faith-and-credit and due process constraints);
26. Friedrich K Juenger, Mass Disasters and the Conflict of Laws, 1989 U. ILL. L. REV. 105, 109-17 (1989) (discussing various choice-of-law methodologies that might lead a forum court to choose another jurisdiction's substantive law). On the other hand, forum courts are generally free as a constitutional matter to choose their own procedural rules to resolve a dispute.
27. See Sun Oil Co. v. Wortman, 486 U.S. 717, 722 (1988) ("Since the procedural rules of its courts are surely matters on which a State is competent to legislate, it follows that a State may apply its own procedural rules to actions litigated in its courts.");
28. Home Ins. Co. v. Dick, 281 U.S. 397, 406 (1930) (stating in dicta that "matters which relate only to the remedy are unquestionably governed by the lex fori"). As a choice-of-law matter, they usually do so. RESTATEMENT (SECOND) OF CONFLICT OF LAWS §122 (1971);
29. id. §122 cmt. c (noting the constitutional constraints on characterizing a "substantive" issue as "procedural").
30. Shady Grove, 130 S. Ct. at 1437-42. Because Justice Stevens joined this portion of Justice Scalia's opinion, there is majority support for this proposition.
31. Id. at 1448.
32. Id. at 1465-69.
33. Id. at 475 (footnote omitted).
34. See Shady Grove, 130 S. Ct. at 1455 (Stevens, J., concurring in part and in the judgment) (stating that the Enabling Act analysis requires a federal court to consider whether a Federal Rule of Civil Procedure is "sufficiently intertwined with a state right or remedy" that it affects substantive rights).
35. The manipulability of Hanna's two-branch analysis was also noted in Abram Chayes, The Bead Game, 87 HARV. L. REV. 741, 751 (1974) (responding critically to Ely, supra note 8).
36. Professor Ely responded to Professor Chayes in John Hart Ely, The Necklace, 87 HARV. L. REV. 753, 753 (1974).
37. See RICHARD A. POSNER, ECONOMIC ANALYSIS OF LAW §21.4, at 598 (7th ed. 2007) ("The plaintiffs net expected gain from litigating is the judgment if he wins discounted by his estimate of the probability that he will win, minus his litigation costs.");
38. Steven Shavell, Suit, Settlement, and Trial: A Theoretical Analysis Under Alternative Methods for the Allocation of Legal Costs, 11 J. LEGAL STUD. 55, 57 (1982) (discussing how risk-neutral parties make valuations based on expected value, "discounting possible outcomes by their probabilities"). In Hand Formula terms, the expected value of a claim is the P x L half of the P x L < B equation for determining negligence.
39. See United States v. Carroll Towing Co., 159 F.2d 169, 173 (2d Cir. 1947) (setting out Judge Hand's classic negligence formula).
40. HENRY SUMNER MAINE, DISSERTATIONS ON EARLY LAW AND CUSTOM 389 (London, John Murray 1883);
41. see also S.F.C MILSOM, HISTORICAL FOUNDATIONS OF THE COMMON LAW 59 (2d ed. 1981) (There was no substantive law to which pleading was adjective. These were the terms in which the law existed and in which lawyers thought.").
42. Some scholars date the rise of the distinction between procedure and substance to the late eighteenth century, tracing the dichotomy to Jeremy Bentham's 1782 work Of Laws in General. E.g., Thomas O. Main, The Procedural Foundation of Substantive Law, 87 WASH. U. L. REV. 801, 804-05 (2010);
43. D. Michael Risinger, "Substance" and 'Procedure" Revisited with Some Afterthoughts on the Constitutional Problems of "Irrebuttable Presumptions," 30 UCLA L. REV. 189,191 (1982).
44. OLIVER WENDELL HOLMES, JR., THE COMMON LAW 53-54 (A.B.A. Publ'g 2009) (1881);
45. id. at 1 (noting the distinction between "the substance of the law" and "its form and machinery").
46. See In re Coles, [1907] 1 K.B. 1 at 4 (Eng.) (stating that "the relation of rules of practice to the work of justice is intended to be that of handmaid rather than mistress");
47. Charles E. Clark, The Handmaid of Justice, 23 WASH. U. L.Q. 297, 297 (1938) (quoting In re Coles, but pointing out that confining rules of procedure to "handmaid" status is difficult in practice);
48. Roscoe Pound, Mechanical Jurisprudence, 8 COLUM. L. REV. 605, 617 (1908) (claiming that lawyers 'lose sight of the end of procedure, they make scientific procedure an end of itself, and thus, in the result, make adjective law an agency for defeating or delaying substantive law and justice instead of one for enforcing and speeding them").
49. See, e.g., Robert G. Bone, The Process of Making Process: Court Rulemaking, Democratic Legitimacy, and Procedural Efficacy, 87 GEO. L.J. 887, 919, 933, 939 (1999) (discussing principles under which procedural rulemaking should be done). The word "friction" is something of a dodge, for there are two distinct camps for those who see law in instrumental terms. One is a rightsbased camp, which believes that procedural rules should enforce the underlying substantive legal rights as strongly as possible; the other is an efficiency-based camp, which believes that procedural rules should enforce substantive legal rights at the lowest social cost possible.
50. Id. at 919, 933.
51. See generally Lawrence B. Solum, Procedural Justice, 78 S. CAL. L. REV. 181, 228 (2004) (discussing philosophical and economic understandings of procedure).
52. NICHOLAS RESCHER, PROCESS PHILOSOPHY: A SURVEY OF BASIC ISSUES 22 (2000). In the quoted passage, Professor Rescher was speaking specifically of natural processes, but other processes act in the same way.
53. A legal right is "inchoate" when it 'has not fully developed, matured,.or vested." BLACK'S LAW DICTIONARY 830 (9th ed. 2009).
54. A "choate" claim is "[c]omplete in and of itself," or a claim "[h]aving ripened or become perfected." Id. at 275.
55. See supra note 17 and accompanying text.
56. For an excellent demonstration of this idea from a real-options analysis, see Joseph A. Grundfest & Peter H. Huang, The Unexpected Value of Litigation: A Real Options Perspective, 58 STAN. L. REV. 1267, 1269 (2006).
57. See RESCHER, supra note 25, at 22 ("Each such process envisions some sector of the future and canalizes it into regions of possibility more restrained in range than would otherwise, in theory, be available.").
58. Id. at 24-25.
59. Id. §21.4.
60. For one discussion of how sunk costs can affect the value of a claim, see Samuel Issacharoff & George Loewenstein, Second Thoughts About Summary Judgment, 100 YALE L.J. 73, 113-14 (1990) (arguing that sunk costs may deter settlement after unsuccessful summary judgment motions).
61. See, e.g., Malcolm v. Nat'l Gypsum Co., 995 F.2d 346, 354 (2d Cir. 1993) (reversing a jury award in the trial of forty-eight consolidated cases because the confluence of parties and variables led to jury confusion). In some systems, such as the common-law system, joinder rules were severely restricted, making such economies almost impossible to realize.
62. See FLEMING JAMES, JR. ET AL., CIVIL PROCEDURE §9.2 (5th ed. 2001). Of course, in one sense, this was precisely what was at stake in Shady Grove: whether the plaintiffs could use Rule 23 to achieve the economies of scale from bringing 10,000 similar claims in one lawsuit.
63. See Shady Grove Orthopedic Assoes., P.A. v. Allstate Ins. Co., 130 S. Ct. 1431, 1459 n.18 (2010) (Stevens, J., concurring in part and in the judgment).
64. See POSNER, supra note 17, §21.1 (noting that the economic objective of a procedural system is to minimize the sum of the cost of an erroneous judgment and the cost of operating the system).
65. For the broad discovery rules used in federal court, see FED. R. CIV. P. 26-37, 45.
66. See POSNER, supra note 17, §21.5, at 602 (noting that pretrial discovery can increase the likelihood of settlement if a defendant learns that the plaintiffs case is stronger than the defendant originally estimated). For information regarding the way in which the possibility of discovering damaging information can induce a plaintiff to invest in a lawsuit with a negative expected value,
67. see Grundfest & Huang, supra note 29, at 1277 (using option theory to explain that a lawsuit with a negative expected value is equivalent to an out-of-the-money call option that a plaintiff will rationally pursue so as long as the price of the option is low enough and its volatility is high enough).
68. FED. R. CIV. P. 56.
69. For an analysis demonstrating that a denial of a defendant's motion for summary judgment can decrease the plaintiff's willingness to settle, see Issacharoff & Loewenstein, supra note 36, at 102-03.
70. See, e.g., Irwin A Horowitz & Kenneth S. Bordens, The Consolidation of Plaintiffs: The Effects of Number of Plaintiffs on Jurors' Liability Decisions, Damage Awards, and Cognitive Processing of Evidence, 85 J. APPLIED PSYCHOL. 909, 916-17 (2000) [hereinafter Horowitz & Bordens, Consolidation] (reporting experimental data showing that the likelihood of plaintiffs' recovery increases as more plaintiffs are joined);
71. Irwin A. Horowitz & Kenneth S. Bordens, The Effects of Outlier Presence, Plaintiff Population Size, and Aggregation of Plaintiffs on Simulated Civil Jury Decisions, 12 LAW & HUM. BEHAV. 209, 225-26 (1988) [hereinafter Horowitz & Bordens, Aggregation] (reporting experimental data showing that aggregation of weak claims increases the probability of recovery).
72. See, e.g., Hans Zeisel & Thomas Callahan, Split Trials and Time Saving: A Statistical Analysis, 76 HARV. L. REV. 1606, 1617 (1963) (reporting statistics showing that defense verdicts increase when the issue of liability is bifurcated and tried before damages).
73. see POSNER, supra note 17, §21.1 (explaining the costs of an erroneous judgment), or as a factor affecting the probability of recovery,
74. see Shady Grove Orthopedic Assoes., P.A. v. Allstate Ins. Co., 130 S. Ct. 1431, 1458-59 (2010) (Stevens, J., concurring in part and in the judgment) (implying the need to permit class action litigation when an aggrieved party did not have the economic incentive to pursue a claim), or whether it distorted the accurate outcome of a nearly, or perhaps entirely, valueless claim,
75. see id. at 1460 (Ginsburg, J., dissenting) (noting that the use of Rule 23 "transform[s] a $500 case into a $5,000,000 award"); id. at 1465 n.3 ("A court's decision to certify a class accordingly places pressure on the defendant to settle even unmeritorious claims.").
76. See Semtek Int'l Inc. v. Lockheed Martin Corp., 531 U.S. 497, 503-04 (2001) (noting that if Rule 41 mandated a claim-preclusive effect for claims arising under state law, then Rule 41 "would arguably violate . . . the Rules Enabling Act" by modifying a substantive right). The drafters of the original Federal Rules regarded preclusion rules as substantive, and therefore beyond the terms of the Rules Enabling Act's delegation of rulemaking power.
77. See Stephen B. Burbank, Interjurisdictional Preclusion and Federal Common Law: Toward a General Approach, 70 CORNELL L. REV. 625, 634 & n.49 (1985) (noting the drafters deleted from an amendment to Rule 14 a sentence regarding preclusive effects of judgment because it would have been substantive);
78. Stephen B. Burbank, The Rules Enabling Act of 1934, 130 U. PA. L. REV. 1015, 1164 n.637 (1982) [hereinafter Burbank, The Rules Enabling Act] (noting multiple instances in which the Advisory Committee acknowledged that preclusive effects of judgment are substantive).
79. See RESTATEMENT (SECOND) OF JUDGMENTS intro., at 6 (1982) (noting the "complementary relationship between the law of procedure and the law of res judicata");
80. id. at 6-10 (describing how the expansion of joinder from common-law pleading to the Federal Rules changed the scope of claim and issue preclusion).
81. See, e.g., ARIZ. REV. STAT. ANN. §12-2506(A)-(B) (2003) (detailing Arizona's liability apportionment scheme, which allocates damages based on percentage of fault);
82. Jonathan Cardi, Note, Apportioning Responsibility to Immune Nonparties: An Argument Based on Comparative Responsibility and the Proposed Restatement (Third) of Torts, 82 IOWA L. REV. 1293, 1305 (1997) (noting that the "majority of states with a pure or modified form of several liability that have addressed the issue allow evidence of nonparty fault generally to be introduced into the distribution calculus");
83. id. at 1305 n.72 (listing the statutes and cases supporting this assertion).
84. See, e.g., FED. R. CIV P. 20(a)(2) (permitting joinder of defendants if any right to relief, including tort relief, is asserted against them jointly, severally, or in the alternative).
85. See, e.g., 28 U.S.C. §1407 (2006) (providing for multi-district transfer);
86. FED. R. CIV. P. 20(a)(1l), 20(a)(2), 23 (detailing rules for permissive joinder of plaintiffs, permissive joinder of defendants, and class actions). For instance, the first case to adopt market-share liability, Sindell v. Abbott Laboratories, 607 P.2d 924, 925 (Cal 1980), involved a class of plaintiffs injured by DES joining as defendants about ninety percent of the going concerns that had manufactured DES. When virtually every plaintiff and every defendant is brought into the case, and when the product sold is fungible (i.e., posing identical risk), then the idea of dividing liability according to market share is arguably justified. Even those cases that departed from Sindell and permitted a single plaintiff to sue a single DES manufacturer used as one of the rationales the ability of the sued manufacturer to use the procedural device of impleader to add additional manufacturers.
87. Collins v. Eli Lilly Co., 342 N.W.2d 37, 51 (Wis. 1984). For the federal impleader rule,
88. see FED. R. CIV. P. 14.
89. Compare Thomas ex rel. Gramling v. Mallett, 701 N.W.2d 523, 551 (Wis. 2005) (extending "risk contribution theory," similar to market share liability, to claims against leadpaint manufacturers), with Skipworth v. Lead Indus. Ass'n, 690 A.2d 169, 172 (Pa. 1997) (rejecting market share liability for lead-paint manufacturers), and State v. Henley, 787 N.W.2d 350, 368 n.29 (Wis. 2010) (noting in dicta Gramling's possible unconstitutionality).
90. See, e.g., Bradford R. Clark, Separation of Powers as a Safeguard of Federalism, 79 TEX. L. REV. 1321, 1328 (2001) (describing how "federal lawmaking procedures" such as bicameralism and supermajority voting advance constitutional concerns for the separation of powers and federalism).
91. Private Litigation Securities Act of 1995, Pub. L. No. 104-67, 109 Stat. 737 (codified at 15 U.S.C. §78u-4 (2006)).
92. Y2K Act, Pub. L. No. 106-37, 113 Stat. 185 (1999) (codified at 15 U.S.C. §§6601-17 (2006)).
93. See Stephen J. Choi, Do the Merits Matter Less After the Private Securities Litigation Reform Act?, 23 J.L. ECON. & ORG. 598, 622 (2007) (demonstrating empirically that the PSLRA has had "important negative impacts on nonnuisance litigation," especially in small-value cases).
94. In the well-known words of Rep. John D. Dingell: Most people look at the procedure as being something that's just kind of amorphous and you don't have to worry much about it. The procedure is of exquisite importance. . . . I'll let you write the substance on a statute and you let me write the procedure, and I'll screw you every time. Regulatory Reform Act: Hearing on H.R. 2327 Before the H. Subcomm. on Admin. Law & Governmental Relations, 98th Cong. 312 (1983).
95. Systems of procedure can have different views on the liberality of amendment. As a general matter, the modern American view is to permit liberal amendment. See FED. R. CIV. P. 15(a)(2) (permitting amendments "when justice so requires").
96. But see FED. R. CIV. P. 16(b)(3)(A), (4) (requiring "good cause" to permit an amendment after the deadline for amendments has passed). Common-law pleading, on the other hand, did not permit amendments that shifted the legal theory the plaintiff was pursuing.
97. See JAMES ET AL., supra note 37, §1.4 ("The inquiry was not whether plaintiff should recover under the law of the land, but whether plaintiff had proved a case ... in whatever form the action had been brought.").
98. See, e.g., Horowitz & Bordens, Consolidation, supra note 44, at 916 (reporting experimental data showing that the average award decreases when more than four plaintiffs are joined);
99. Horowitz & Bordens, Aggregation, supra note 44, at 226 (reporting experimental data showing that aggregation of weak claims with strong claims can suppress the value of strong claims).
100. See RESCHER, supra note 25, at 19 (noting that the sameness of the outcome does not define the process).
101. For literature either modeling or experimentally demonstrating the effects of different procedural devices on the outcomes of cases, see, for example, Horowitz & Bordens, Consolidation, supra note 44, at 909 (describing experimental results in which different joinder patterns affected case outcomes);
102. Issacharoff & Loewenstein, supra note 36, at 123 (modeling summary judgment outcomes based on mathematical analysis); Zeisel & Callahan, supra note 45, at 1607-08 (analyzing outcomes in actual unitary and bifurcated trials).
103. Compare Bell Atl. Corp. v. Twombly, 550 U.S. 544, 559 (2007) (establishing a pleading standard designed "to avoid the potentially enormous expense of discovery"),
104. with id. at 586 (Stevens, J., dissenting) (stating that "fear of the burdens of litigation does not justify factual conclusions supported only by lawyers' arguments rather than sworn denials or admissible evidence").
105. See also Ashcroft v. Iqbal, 129 S. Ct. 1937, 1940-41 (2009) (affirming the general applicabillity of Twombly's approach in federal cases);
106. Edward A. Hartnett, Taming Twombly, Even After Iqbal, 158 U. PA. L. REV. 473, 503-05 (2010) (arguing that federal judges should typically permit some discovery before ruling on a motion to dismiss a claim);
107. Rebecca Love Kourlis, Reinvigorating Pleadings, 87 DENV. U. L. REV. 245, 274-77 (2010) (discussing states in which pre-suit discovery ameliorates heightened-pleading requirements).
108. Cf. Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 816 (1985) (noting in a horizontal choice-of-law context that "[t]here can be no [constitutional] injury in applying [the law of one state] if it is not in conflict with that of any other jurisdiction connected with this suit").
109. See, e.g., N.D. CAL. CIV. R. 3-4(c)(1) (delineating the paper size requirements for filing with the court).
110. See 1 WILLIAM HOLDSWORTH, A HISTORY OF ENGLISH LAW 426-27, 441-42 (1922) (detailing how court officials behaved opportunistically in generating revenues from myriad procedural fees). The quality of justice suffered as a result.
111. See id. at 442 (noting "a consensus of evidence throughout the eighteenth century that it was better to sacrifice just claims rather than embark upon a suit in equity"). Likewise, the Stamp Act of 1765, whose passage was one of the events precipitating the American Revolution, mandated a tax on the paper used for most filings in court.
112. See Stamp Act, 1765, 5 Geo. 3, c. 12 (Eng.) (requiring a tax of "one shilling and six pence" on "every Skin or Piece of Vellum or Parchment, or Sheet or Piece of Paper, on which shall be ingrossed, written, or printed, any Petition, Bill, Answer, Claim, Plea, Replication, Rejoinder, Demurrer, or other Pleading in any Court of Chancery or Equity," as well as taxes ranging from three pence to ten shillings for papers used for other court filings), repealed by 6 Geo. 3, c. 11 (1766).
113. Compare Holster v. Gateo, Inc., 130 S. Ct. 1575, 1576 (2010) (Scalia, J., concurring) (noting that even "a state rule limiting the length of the complaint, for example, or specifying the color and size of the paper" can affect the outcome when the federal rule is different), with Holster v. Gateo, Inc., 618 F.3d 214, 217 (2d Cir. 2010) (Calabresi, J.) (noting that federal courts should not be required to follow "trivial state court rules" even when a statute generally requires a federal court to apply state rules).
114. For an analysis of Heraclitus's thought, see Daniel W. Graham, Heraclitus, in THE STANFORD ENCYCLOPEDIA OF PHILOSOPHY (Edward N. Zalta ed., Fall 2008), available at http://plato.stanford.edu/entries/heraclitus.
115. Heraclitus's principal work is the cryptic and mystical On Nature (ca. 500 B.C.E.), which survives only through fragmentary epigrams quoted in the works of later philosophers. Id. §1.
116. This description of Heraclitus's position belongs to Socrates. See PLATO, Cratylus, in THE COLLECTED WORKS OF PLATO 421, 438 (Edith Hamilton & Huntington Cairns eds., Benjamin Jowett trans., 1961) (describing Socrates' analysis of Heraclitus's position that all things are in motion and nothing is at rest); see also id. at 474 (describing Heraclitus's view that "everything is in a state of transition and there is nothing abiding").
117. Plato developed aspects of his Theory of Forms in a number of works, including The Republic. See Hugh Lawson-Tancred, Introduction, in ARISTOTLE, METAPHYSICS xi, xviii (Hugh Lawson-Tancred trans., Penguin Books 1998).
118. See ARISTOTLE, supra note 71, at 81 (stating that "in the case of things that are, the primary object is substance" and that "the fundamental duty of philosophers . . . is to gain possession of the principles and causes of substances").
119. See ALFRED NORTH WHITEHEAD, PROCESS AND REALITY 45 (1929) (discussing "the evil produced by the Aristotelian 'primary substance' ");
120. see also RESCHER, supra note 25, at 4 ("[I]t does not stretch matters unduly to say that the Aristotelean view of the primacy of substance and its ramifications . . . have proved to be decisive for much of Western philosophy.").
121. But see NICHOLAS RESCHER, PROCESS METAPHYSICS 10-12 (1996) (discussing ways in which Aristotle drew on process ideas). For a short treatment of the meaning of "substance" in the works of Aristotle and other Western philosophers,
122. see Howard Robinson, Substance, in STANFORD ENCYCLOPEDIA OF PHILOSOPHY (Edward N. Zalta ed., Winter 2009), available at http://plato. stanford.edu/entries/substance. Eastern philosophical traditions have generally accorded the idea of change a higher place in philosophical thought.
123. See, e.g., Chung-ying Cheng, The Origins of Chinese Philosophy, in COMPANION ENCYCLOPEDIA OF ASIAN PHILOSOPHY 493,501-06 (Brian Carr & Indira Mahalingan eds., 1997) (discussing centrality of change and process in Chinese philosophy);
124. JOHN M. KOLLER, ORIENTAL PHILOSOPHIES 157-65 (2d ed. 1985) (discussing the importance of the idea of becoming in Buddhist philosophy);
125. AMARTYA SEN, THE IDEA OF JUSTICE 208-21 (2009) (discussing the process-oriented and consequence-sensitive nature of nyaya in Hindi philosophy).
126. See supra notes 19-23 and accompanying text (detailing historical differentiation between substance and procedure).
127. see RESCHER, supra note 25. The modern standard of process philosophy, renowned both for its creativity and for its impenetrability, is Alfred North Whitehead's Process and Reality. WHITEHEAD, supra note 73.
128. For arguments along these lines, see Main, supra note 21.
129. see also Main, supra note 21, at 801, 818-22 ("[O]nly the broadest summary of this literature is necessary to remind that procedural means can achieve substantive ends ....");
130. Stephen B. Burbank, The Costs of Complexity, 85 MICH. L. REV. 1463, 1472-73 (1985) (book review) (arguing that the idea of "neutral procedure" does not exist). On some of the ways in which this change occurs, see supra notes 34-59 and accompanying text.
131. Factors other than procedural rules also determine a claim's value. See supra notes 32-33 and accompanying text.
132. See THOMAS D. ROWE, JR. ET AL., OVIL PROCEDURE 599 (2d ed. 2008) ("It is universally accepted that, in the absence of controlling federal law, a federal court will apply the relevant state's substantive law.").
133. After a trilogy of cases in 1949-Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541 (1949);
134. Woods v. Interstate Realty Co., 337 U.S. 535 (1949);
135. and Ragan v. Merchants Transfer & Warehouse Co., 337 U.S. 530 (1949)-it seemed that the Court was moving toward a rule always applying state rules of procedure in diversity cases.
136. But the Court shifted course in Byrd v. Blue Ridge Rural Electric Cooperative, Inc., 356 U.S. 525 (1958), and after Hanna v. Plumer, 380 U.S. 460 (1965), it has kept its distance from the "Always" answer.
137. Sibbach v. Wilson & Co., 312 U.S. 1, 14 (1941). For further discussion of this approach, see infra notes 87-88, 92-94, 97-104 and accompanying text.
138. The case usually cited for the "balance of interests" approach is Byrd v. Blue Ridge Rural Electric Cooperative, Inc., 356 U.S. 525 (1958), although Byrd has an alternate possible holding and is ambiguous enough that it is not clear that the Court adopted a balancing approach.
139. See also Gasperini v. Ctr. for Humanities, Inc., 518 U.S. 415, 431-39 (1996) (arguably adopting Byrds balancing approach);
140. id. at 437 folding that "the principal state and federal interests can be accommodated"). For a strong endorsement of the balancing approach, see MARTIN H. REDISH, FEDERAL JURISDICTION 233-46 (2d ed. 1990). Such a balancing approach is common in non-Erie choice-of-law situations.
141. See Joseph P. Bauer, The Erie Doctrine Revisited: How a Conflicts Perspective Can Aid the Analysis, 74 NOTRE DAME L. REV. 1235, 1281-99 (1999) (arguing that interest analysis should be relevant in determining "procedural Erie" questions).
142. The seminal case proposing an outcome-determinative test is Guaranty Trust Co. of New York v. York, 326 U.S. 99 (1945). Guaranty Trust seemed to adopt an ex ante approach to outcome determination: a federal court must adopt a state rule if, when the lawsuit commences, use of a federal rather than a state rule can be expected to yield a difference in outcome. See id. at 109 (In essence, the intent of [Erie] was to insure that, in all cases where a federal court is exercising jurisdiction solely because of the diversity of citizenship of the parties, the outcome of the litigation in the federal court should be substantially the same, so far as legal rules determine the outcome of a litigation, as it would be if tried in a State court."). In its 1949 trilogy, the Court seemed to switch to an ex post approach to outcome determination: a federal court must adopt a state rule when a difference in the state and federal rule does in fact lead to a different outcome, even though that difference might not have been expected when the case commenced. See supra note 83 and accompanying text. Finally, the Court changed to a policyfocused approach to outcome determination: a federal court must apply a state rule only when failing to do so would frustrate designated policy objectives. This policy-focused approach, which was developed as dicta in Hanna v. Plumer, 380 U.S. 460, 466-69 (1965), is further discussed infra notes 95,105-07 and accompanying text.
143. The first case mentioning "incidental effects" is Mississippi Publishing Corp. v. Murphree, 326 U.S. 438, 445 (1946).
144. See also Bus. Guides, Inc. v. Chromatic Commc'ns Enters., Inc., 498 U.S. 533, 552 (1991) (upholding Rule 11 even though it had an "incidental" effect on substantive rights);
145. Burlington N. R.R. v. Woods, 480 U.S. 1, 5 (1987) (upholding Federal Rule of Appellate Procedure 38; stating that "Rules which incidentally affect litigants' substantive rights do not violate [the Rules Enabling act] if reasonably necessary to maintain the integrity of that system of rules");
146. See Stewart Org. v. Ricoh Corp., 487 U.S. 22, 27 (1988). The same is true if a rule of federal substantive common law dictates the outcome.
147. See Semtek Int'l Inc. v. Lockheed Martin Corp., 531 U.S. 497, 508-09 (2001).
148. The "twin aims" approach was first suggested in dicta in Hanna. 380 U.S. at 468. It has been applied to the Court's holdings in other cases.
149. See Gasperini, 518 U.S. at 430;
150. Walker v. Armco Steel Corp., 446 U.S. 740, 752-53 (1980) (requiring application of a state rule of procedure when the policy of avoiding inequity was implicated, even though the policy of discouraging forum shopping was not). Because forum shopping is likely principally when parties expect different outcomes ex ante, and because inequities arise principally when outcomes in state and federal court differ ex post, the "twin aims" policy-focused approach has a strong relationship to both the ex ante outcome-determinative and the ex post outcome-determinative approaches discussed supra note 86.
151. See Gasperini, 518 U.S. at 431-39 (reexamination clause);
152. Byrd v. Blue Ridge Rural Elec. Coop., Inc., 356 U.S. 525, 535-40 (1958) (jury trial guarantee). Gasperini does not adopt the "balance of interests" methodology explicitly, but its attempt to accommodate the state's interest in obtaining a judicial check on jury decisionmaking with the federal interest in having the check performed by the trial judge, in conjunction with its reliance on Byrd, runs a parallel course. Some scholars argue that a "balance of interests" approach either explains the Erie line of cases or should be adopted as the relevant principle.
153. See REDISH, supra note 85, at 211-46;
154. Bauer, supra note 85, at 1286-90. But see Thomas D. Rowe, Jr., Not Bad for Government Work: Does Anyone Else Think the Supreme Court Is Doing a Halfway Decent Job in Its Erie-Hanna Jurisprudence?, 73 NOTRE DAME L. REV. 963, 987 (1998) ("[A]nyone who in (at least) the last ten or so years had thought - or worse, taught-that Byrd was the dominant approach . . . had not been paying close attention to the Court's recent decisions.").
155. In her Shady Grove dissent, Justice Ginsburg argued that the balance of federal and state interests is also relevant at the first step of the Erie analysis-determining whether a Federal Rule of CivU Procedure was broad enough to cover a case. Shady Grove Orthopedic Assoes., P.A. v. Allstate Ins. Co., 130 S. Ct. 1431, 1461-64 (2010) (Ginsburg, J., dissenting);
156. 28 U.S.C. §2072(a) (2006).
157. Id. §2072(b). These criticisms have often been made in the academic literature. For one famous iteration of the arguments,
158. see Ely, supra note 8, at 718-40. At the time that Professor Ely wrote, there was no section 2072(b);
159. See Shady Grove, 130 S. Ct. at 1442 (plurality opinion) (noting that "we have rejected every statutory challenge to a Federal Rule that has come before us").
160. See, e.g., Walker v. Armco Steel Corp., 446 U.S. 740, 753 (1980) (applying Oklahoma statute regarding the commencement of a lawsuit in federal diversity suit to avoid "inequitable administration" of law);
161. Ragan v. Merchs. Transfer & Warehouse Co., 337 U.S. 530, 532 (1949) (applying Kansas statute of limitations so that parties invoking diversity jurisdiction would not "gain advantages over those confined to state courts");
162. Guar. Trust Co. of N.Y. v. York, 326 U.S. 99, 110 (1945) (applying New York statute of limitations for similar reasons).
163. See supra notes 11, 91 and accompanying text.
164. id. at 1452, Justice Stevens would have required that the Federal Rule not "displace a State's definition of its own rights or remedies,"
165. id. at 1449. Justice Ginsburg's dissent thought that Rule 23 was not broad enough to control the case,
166. 130 S. Ct. at 1443.
167. Id. (internal quotation marks omitted).
168. Id. at 1444.
169. Sibbach's definition bears re-emphasis: a Federal Rule is valid when it "really regulates procedure-the judicial process for enforcing rights and duties recognized by substantive law and for justly administering remedy and redress for disregard or infraction of them." Sibbach v. Wilson & Co., 312 U.S. 1, 14 (1941) (emphasis added).
170. Shady Grove, 130 S. Ct. at 1443;
171. See infra notes 135-136 and accompanying text.
172. See supra note 65 and accompanying text.
173. See supra note 60 and accompanying text.
174. See supra note 83 and accompanying text.
175. See Gasperini v. Ctr. for Humanities, Inc., 518 U.S. 415, 430 (1996) (requiring the use of a state rule when " 'substantial variations between state and federal [money judgments]' may be expected")
176. (quoting Hanna v. Plumer, 380 U.S. 460, 467-68 (1965)) (alteration in original);
177. id. at 431 ("Erie precludes a recovery in federal court significantly larger than the recovery that would have been tolerated in state court.").
178. For this reason, and because of the ease with which government interests can be manipulated to ensure the application of forum law, interest analysis remains an unpopular method in the horizontal choice-of-law context when true conflicts exist. See EUGENE F. SCOLES ET AL., CONFLICT OF LAWS §2.20-.24 (4th ed. 2004) (analyzing each American state's choice-oflaw approach and identifying only three jurisdictions-California, the District of Columbia, and New Jersey-that use interest analysis for tort claims and none that use it for contract claims);
179. id. §2.9 (discussing interest analysis and its benefits and difficulties);
180. see also P.V. ex rel. T.V. v. Camp Jaycee, 962 A.2d 453, 460 (N.J. 2008) (rejecting interest analysis in tort cases);
181. cf. Shady Grove Orthopedic Assoes., P.A. v. Allstate Ins. Co., 130 S. Ct. 1431, 1441 n.7 (2010) (Scalia, J.) (calling "[t]he search for state interests and policies that are 'important'. . . standardless");
182. Ely, supra note 8, at 709 (noting that Byrd, which is often seen as the case best exemplifying the "balance of interests" approach in the Erie line of cases, "exhibits a confusion that exceeds even that normally surrounding a balancing test").
183. See supra note 14 and accompanying text.
184. Walter Wheeler Cook, "Substance" and "Procedure" in the Conflict of Laws, 42 YALE L.J. 333, 337 (1933).
185. For instance, Justice Frankfurter noted that "[n]either 'substance' nor 'procedure' represents the same invariants. Each implies different variables depending upon the particular problem for which it is used." Guar. Trust Co. of N.Y. v. York, 326 U.S. 99, 108 (1945);
186. see also Hanna v. Plumer, 380 U.S. 460, 471 (1965) (The line between 'substance' and 'procedure' shifts as the legal context changes."). For a comparable observation from another common-law system,
187. see Matthews v. Ministry of Defence, [2003] UKHL 4 at [33], [2003] 1 A.C. 1163 (H.L.) 1179 (appeal taken from Eng.) (U.K.) (noting the fundamental distinction between procedure and substance, but acknowledging that it "is a slippery one");
188. see also 1 DICEY, MORRIS & COLLINS ON THE CONFLICT OF LAWS ¶ 7-004 (Lawrence Collins ed., 14th ed. 2006) ("In drawing [the distinction between procedure and substance], regard should be had in each case to the purpose for which the distinction is being used and to the consequences of the decision in the instant context.").
189. For one article arguing the Court generally had handled everything about right, see Rowe, supra note 91, at 963-66.
190. But see id. at 987, 1010-11 (critiquing the Byrd "balance of interest" approach). At the time of the article, Shady Grove had not yet been decided. In correspondence with me, Professor Rowe has suggested some disagreement with the majority/plurali opinion in Shady Grove.
191. Id. at 1441 n.7.
192. See generally R.H. Coase, The Problem of Social Cost, 3 J.L. & ECON. 1 (1960). Transaction costs include litigation costs and the costs of error. See supra note 34 and accompanying text. If we include within the meaning of "error" the difference in value achieved when a federal court employs its own rules to process a state-law claim rather than the rules a state court would have employed to process the same claim, then we can define the value of a claim at the moment of its filing as its expected value in the absence of transaction costs.
193. See Erie R.R. v. Tompkins, 304 U.S. 64, 79-80 (1938) (holding that, in a diversity case, a federal court must apply the state's substantive law regarding the elements of a claim);
194. see also Palmer v. Hoffman, 318 U.S. 109, 117 (1943) (stating in dicta that, in a diversity case, a federal court must apply the state's law regarding the contributory-negligence defense);
195. cf. Semtek Int'l Inc. v. Lockheed Martin Corp., 531 U.S. 497, 503 (2001) (declining in a diversity case to read Rule 41 as stating a rule of claim preclusion due to arguable Rules Enabling Act issues that would arise). In order to determine the strength of the entitlement and defenses, a court must know which state's substantive law is apphcable.
196. See Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496-98 (1941) (holding that, in a diversity case, a federal court must apply the same choice-of-law rule as a state court in the forum state would have applied).
197. See Cities Serv. Oil Co. v. Dunlap, 308 U.S. 208, 212-13 (1939) (holding that a federal court in a diversity case must apply the relevant state's burden of proof on matters relating to substantive claims);
198. Palmer, 318 U.S. at 117 (same with respect to defenses).
199. See Guar. Trust Co. of N.Y. v. York, 326 U.S. 99, 109-11 (1946) (holding that, in a diversity case, a federal court should apply the relevant state's statute of limitations rather than the federal equitable doctrine of laches). The applicability of the statute of limitations may hinge on contingencies that have not come to pass when the complaint is filed.
200. See Walker v. Armco Steel Corp., 446 U.S. 749, 751-53 (1980) (requiring a federal court in a diversity case to apply a state rule that does not toll the statute of limitations until service, rather than the federal rule tolling the statute on the filing of the complaint);
201. Ragan v. Merchs. Transfer & Warehouse Co., 337 U.S. 530, 532-34 (1949) (same). For further discussion of Ragan and Walker,
202. see infra note 142 and accompanying text.
203. See, e.g., FED. R. CIV. P. 23.1(b)(3)(A) (requiring a party bringing a shareholders' derivative action to plead any pre-filing efforts "to obtain the desired action" from the board of directors or others).
204. See Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541, 544-45 (1949) (describing a New Jersey statute requiring a shareholder to post a bond before proceeding with a derivative suit). For further discussion, see infra notes 143-45 and accompanying text.
205. See Woods v. Interstate Realty Co., 337 U.S. 535, 536 n.1 (1949) (describing a Mississippi statute that required a corporation to be licensed to do business in the state before it could bring suit in a state court).
206. See Gasperini v. Ctr. for Humanities, Inc., 518 U.S. 415, 426-31 (1996) (requiring a federal court in a diversity case to adopt the state's more restrictive "deviates materially" standard rather than the federal "shock the conscience" standard for establishing the maximum permissible recovery on a state-law claim);
207. id. at 428-29 (suggesting that a federal court must also adopt a state-law cap on damages).
208. See Hanna v. Plumer, 380 U.S. 460, 465-70 (1965) (permitting a federal court in a diversity case to use a method of service different from the method used in state court);
209. Miss. Publ'g Corp. v. Murphree, 326 U.S. 438, 441-46 (1946) (permitting a federal court in a diversity case to use a method of service that would bring a defendant before a district court other than the district encompassing the geographical area in which service occurred). For further discussion oí Hanna, see infra note 142 and accompanying text.
210. See Sibbach v. Wilson & Co., 312 U.S. 1, 10-16 (1941) (requiring a party in a diversity case to submit to a Rule 35 examination, even though such examinations were not permitted under the state's rules of discovery).
211. See Byrd v. Blue Ridge Rural Elec. Coop., Inc., 356 U.S. 525, 533-40 (1958) (requiring that a jury in a diversity case determine a factual issue, even though the issue would be determined by a judge in state court).
212. See Burlington N. R.R. v. Woods, 480 U.S. 1, 4-8 (1987) (holding that a federal court in a diversity case need not follow a state court's requirements with respect to posting a bond on appeal). For further discussion, see infra notes 144-45 and accompanying text.
213. Bus. Guides, Inc. v. Chromatic Commc'ns Enters., Inc., 498 U.S. 533, 551-54 (1991) (holding that Rule 11 did not "abridge, enlarge or modify any substantive right," even though Rule 11 overlaps in its coverage with state-law claims for malicious prosecution).
214. See supra notes 109-110 and accompanying text.
215. Again, this was a strength of the formalist approach. See supra note 102 and accompanying text. For a comparable distinction in the outcome-determinative context, see Guaranty Trust Co. of NY. v. York, 326 U.S. 99, 109-10 (1945) (permitting federal courts to apply their own rules regarding "the manner and the means by which a right to recover ... is enforced," but requiring that state law be adopted in diversity cases when the law "bears on a State-created right" or "intimately affect[s] recovery or non-recovery").
216. See supra notes 3, 86, 98 and accompanying text; see also Miss. Publ'g Corp. v. Murphree, 326 U.S. 438, 445 (1946) ("Undoubtedly most alterations of the rules of practice and procedure may and often do affect the rights of litigants.").
217. On several occasions, the Court has read a Federal Rule of Civil Procedure narrowly to avoid an arguable clash with the Rules Enabling Act. See Semtek Int'l Inc. v. Lockheed Martin Corp., 531 U.S. 497, 503 (2001) (declining to read Rule 41 as stating a rule of claim preclusion);
218. Ortiz v. Fibreboard Corp., 527 U.S. 815, 845 (1999) (noting that "[t]he Rules Enabling Act underscores the need for caution" in interpreting Rule 23);
219. Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 613 (1997) (same). As I have suggested, the Court's concern for adopting Federal Rules that create rules of preclusion is well-founded; such rules affect the pre-fillng value of claims.
220. Walker v. Armco Steel Corp., 446 U.S. 749 (1980);
221. Hanna v. Plumer, 380 U.S. 460 (1965);
222. Ragan v. Merchs. Transfer & Warehouse, 337 U.S. 530 (1949).
223. Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541 (1949).
224. Burlington N. R.R. v. Woods, 480 U.S. 1 (1980).
225. Shady Grove Orthopedic Assoes., P.A v. Allstate Ins. Co., 130 S. Ct. 1431, 1436-37 (2010).
226. See Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 617 (1997) (noting that " '[t]he policy at the very core of the class action mechanism is to overcome the problem that small recoveries do not provide the incentive for any individual to bring a solo action prosecuting his or her rights' ")
227. (quoting Mace v. Van Ru Credit Corp., 109 F.3d 338, 344 (7th Cir. 1997));
228. see also Shady Grove, 130 S. Ct. at 1460 (Ginsburg, J., dissenting) (noting that using Rule 23 can "transform a $500 case into a $5,000,000 award");
229. Castano v. Am. Tobacco Co., 84 F.3d 734, 748 (5th Cir. 1996) (noting that "[t]he most compelling rationale for finding superiority in a class action [is] the existence of a negative-value suit...."). For a classic article on large-scale, smallstakes litigation and the agency-cost problems they pose,
230. see generally Jonathan R. Macey & Geoffrey P. Miller, The Plaintiffs' Attorney's Role in Class Action and Derivative Litigation: Economic Analysis and Recommendations for Reform, 58 U. CHI. L. REV. 1 (1991). Unless a statute creating or imposing a penalty, or a minimum measure of recovery specifically authorizes the recovery thereof in a class action, an action to recover a penalty, or minimum measure of recovery created or imposed by statute may not be maintained as a class action.
231. Shady Grove, 130 S. Ct. at 1437. Somewhat more precisely, the district court held that the claim, which sought to collect statutory interest, was in effect a claim seeking a penalty. The Supreme Court did not challenge this characterization. Id.
232. It seems evident that the class action yielded a positive value for the plaintiff; otherwise the plaintiff would not have brought the claim. It is not as clear whether the case had a positive value for all the members of the class, but other provisions of Rule 23, especially the typicality and adequacy-of-representation requirements of Rules 23(a)(3) and 23(a)(4) should, at a minimum, ensure that the class members are in no worse position than they would have been had they not been brought into the class. See Jay Tidmarsh, Rethinking Adequacy of Representation, 87 TEX. L. REV. 1137 (2009).
233. See Tidmarsh, supra note 150, at 1150.
234. Shady Grove, 130 S. Ct. at 1459 & n.18 (Stevens, J., concurring in part and in the judgment).
235. Id. at 1459 (internal quotation marks omitted).
236. Id.
237. On this point Justice Stevens joined Justice Scalia's opinion, thus forging a majority.
238. See supra notes 11, 96-97 and accompanying text.
239. For discussions of New York's policy, see Shady Grove, 130 S. Ct. at 1440-41; id. at 1464-65 (Ginsburg, J., dissenting).
240. id. §1692k(a)(2)(B)(i), but limited the recovery of class members to an amount "not to exceed the lesser of $500,000 or 1 per centum of the net worth of the debt coUector,"
241. id. §1692k(a)(2)(B)(i).
242. See supra note 142 and accompanying text.
243. See Shady Grove, 130 S. Ct. at 1466-67 (Ginsburg, J., dissenting).
244. See supra notes 11, 96-97 and accompanying text.
245. See supra notes 17, 116, 118 and accompanying text.
246. See supra text foUowing note 149;
247. see also McCarty v. Pheasant Run, Inc., 826 F.2d 1554, 1557 (7th Cir. 1987) (Posner, J.) ("[T]he [Hand] formula has greater analytic than operational significance. Conceptual as well as practical difficulties in monetizing personal injuries may continue to frustrate efforts to measure expected accident costs with the precision that is possible, in principle at least, in measuring the other side of the equation-the cost or burden of precaution.").
248. Cf. Sun Oil Co. v. Wortman, 486 U.S. 717, 722 (1988) ("Since the procedural rules of its courts are surely matters on which a State is competent to legislate, it follows that a State may apply its own procedural rules to actions litigated in its courts.");
249. RESTATEMENT (SECOND) OF CONFLICT OF LAWS §122 (1971) (recognizing the forum's interest in the application of its own procedural law).
250. For the classic arguments against a federal interest in creating rules that affect the value of a state-law claim, see Erie R.R. v. Tompkins, 304 U.S. 64 (1938), and
251. Guaranty Trust Co. of N.Y. v. York, 326 U.S. 99 (1945).
252. Guaranty Trust, 326 U.S. at 109.
253. See EDWARD A. PURCELL, JR., BRANDEIS AND THE PROGRESSIVE CONSTITUTION: ERIE, THE JUDICIAL POWER, AND THE POLITICS OF THE FEDERAL COURTS IN TWENTIETH-CENTURY AMERICA 3 (2000) (explaining that Erie's "vital concern lay in broader ideas about judicial lawmaking and separation of powers");
254. Burbank, The Rules Enabling Act, supra note 47, at 1113-15 (explaining the fundamental importance of "directing attention to allocation of powers").
255. See supra note 139-41 and accompanying text.
256. See supra notes 127-28, 131-132 and accompanying text.
257. See, e.g., Duncan v. Walker, 533 U.S. 167, 174 (2001) ("It is our duty to give effect, if possible, to every clause and word of a statute.") (internal quotation marks omitted);
258. Searight v. Stokes, 44 U.S. (3 How.) 151, 161 (1845) ("Every word of a statute must receive a meaning, unless the court are compelled to consider some words synonymous.").
259. Guaranty Trust, 326 U.S. at 109.
260. Hanna v. Plumer, 380 U.S. 460, 468 (1965).
261. See supra text preceding note 140.
262. 326 U.S. at 109.
263. 130 S. Ct. 1431, 1471 (2010) (Ginsburg, J. dissenting). The word "substantial" had appeared in both Justice Ginsburg's opinion in Gasperini,
264. see Gasperini v. Ctr. for Humanities, Inc., 518 U.S. 415, 430 (1996), and in Hanna,
265. see 380 U.S. at 467.
266. See Gasperini, 518 U.S. at 437 (noting the desirability of accommodating "the principal state and federal interests").
267. See THE FEDERAUST No. 80 (Alexander Hamilton) (The reasonableness of the agency of the national courts in cases in which the State tribunals cannot be supposed to be impartial, speaks for itself.");
268. see also Bank of United States v. Deveaux, 9 U.S. (5 Cranch) 61, 87 (1809) (noting that "the constitution itself . . . views with such indulgence the possible fears and apprehensions of suitors, that it has established national tribunals for the decision of controversies ... between citizens of different states").
269. See Robert M. Cover, The Uses of Jurisdictional Redundancy: Interest, Ideology, and Innovation, 22 WM. & MARY L. REV. 639 (1981).
270. Cf. Daniel Klerman, Jurisdictional Competition and the Evolution of the Common Law, 74 U. CHI. L. REV. 1179 (2007) (arguing that the existence of multiple common-law courts in England fostered competition for legal business, resulting in numerous innovations in the common law). Indeed, after the enactment of the Federal Rules of Civil Procedure, many state courts adopted the Federal Rules nearly in toto, and the basic vision of the Federal Rulesliberal pleading, broad discovery, generous joinder, and so on-has exercised an influence even on those states that did not adopt the Rules.
271. See John B. Oakley & Arthur F. Coon, The Federal Rules in State Courts: A Survey of State Court Systems of Civil Procedure, 61 WASH. L. REV. 1367, 1367 (1986) (analyzing states that adopted the Federal Rules or its philosophy regarding pleading, as well as states that did not).
272. But see John B. Oakley, A Fresh Look at the Federal Rules in State Courts, 3 NEV. L.J. 354, 383-84 (2003) (describing more divergence between federal and state practices in recent years).
273. RICHARD H. FALLON, JR. ET AL., HART & WECHSLER'S THE FEDERAL COURTS AND THE FEDERAL SYSTEM 496-518 (6th ed. 2009) (discussing the independent-and-adequate-state-ground doctrine in the procedural context). Although the analogy is not perfect, the converse proposition here is that federal courts have an interest in applying, and therefore should be allowed to apply, their own process to adjudicate claims based on state law.
274. See supra text following note 81.
275. See supra notes 111-112 and accompanying text.
276. See Dice v. Akron, Canton & Youngstown R.R., 342 U.S. 359, 363 (1952) (stating that "the right to trial by jury is too substantial a part of the rights accorded by the [Federal Employers' Liability Act] to permit it to be classified as a mere 'local rule of procedure' for denial in the manner that Ohio has here used").