The Repressible Myth of Shady Grove

This Article untangles the effects of the Supreme Court's latest word on the Erie doctrine, by taking the vantage point of a lower court trying to uncover the logical implications of the Court's new pronouncement. First, Shady Grove lightly confirms the limited role of constitutional constraints. Second, it sheds only a little light on judicial choice-of-law methodology. Third, by contrast, it does considerably clarify the conflict between Federal Rules and state law: if a Rule regulates procedure, then it is valid and applicable without exception in all federal cases, to the extent of its coverage; in determining the Rule's coverage, federal courts should, when alternative readings are defensible, read it to minimize its intrusion on substantive rights (that is, they should construe a Rule in a fashion that includes considering the impact on the generalized congressional and state interests in regulating substance, but they should not adopt a narrowed construction just to avoid conflict with the state's interests peculiarly in play in the particular situation presented by the case at bar). In the end, Shady Grove has not fundamentally altered Erie, but it mercifully makes the current interpretation more comprehensible. INTRODUCTION I. THE CONSTITUTION A. Condition of Prior Law 1. Institutional Framework on Vertical Choice of Law 2. Constitutional Limits on Federal Lawmaking. B. Contribution of Shady Grove II. THE "UNGUIDED ERIE CHOICE" A. Condition of Prior Law B. Contribution of Shady Grove III. THE FEDERAL RULES REALM A. Condition of Prior Law 1. Sibbach-Hanna 2. Federal Rules' Scope B. Contribution of Shady Grove 1. Sibbach-Hanna a. Sibbach Pillar b. Hanna Pillar c. Summary 2. Federal Rules' Scope a. Three Opinions b. Standard for Rules' Construction c. Federal Rule 23's Coverage d. New York Statute's Coverage e. Summary 3. Implications a. Class Actions b. Summary Judgment c. Pleading Rules CONCLUSION INTRODUCTION Endless writing on the subject of the Erie (1) doctrine has produced strikingly little agreement. One of the few undisputed points is oddly this: the most influential article ever written on the subject was John Hart Ely's The Irrepressible Myth of Erie. (2) In the latest word of the Supreme Court on the topic, Shady Grove Orthopedic Associates, P.A. v. Allstate Insurance Co., (3) his classic article was one of only two Erie articles cited in the Justices' opinions and the only one cited more than once. (4) In that article, focusing exclusively on the corner of federal actions based on diversity jurisdiction, (5) but being in a special position to perceive the lessons of the recent Hanna v. Plumer (6) case, Professor Ely brilliantly dissected the hitherto amorphous unity that had been the Erie doctrine. Hesaw it to pose a set of three distinct questions arising under the Constitution, the Rules of Decision Act (RDA), (7) and the Rules Enabling Act (REA) (8)--concerning, respectively, the Congress's power to make the vertical choice of state or federal law, the federal courts' choice of law when unguided by statute or Rule, and those courts' choice of law when a Federal Rule was on point. (9) The doctrine's structure was never the same thereafter. By contrast, the answers he gave to the three questions (l0) were not completely satisfying. (11) In any event, his efforts failed to put the questions to rest, either for lower courts or for scholars. (12) His article ended up being influential more for structure than for content. After Ely, the Erie doctrine continued its evolution. The law today is that the Constitution or Congress may make a definitive choice of law. Otherwise, the vertical choice of law is left to the courts' methodology. …