UNITED STATES COURT OF APPEALS
For the Second Circuit
No. 25-2284-cv
BRIEF FOR APPELLANT
I. INTRODUCTION AND SUMMARY OF ARGUMENT
This diversity action turns on a question of state substantive law. The district court erred by applying federal common law to the contract's choice-of-law clause instead of New York's substantive contract rules — a clear violation of the rule announced in Erie Railroad v. Tompkins, 304 U.S. 64 (1938), that a federal court sitting in diversity must apply state substantive law.
II. THE ERIE DOCTRINE GOVERNS
In Erie, 304 U.S. at 78, the Supreme Court overruled Swift v. Tyson and held that, except in matters governed by the Federal Constitution or by Acts of Congress, the law to be applied in any case is the law of the State. "There is no federal general common law." This rule governs every diversity action in federal court, including this one.
A. State Choice-of-Law Rules Apply
Under Klaxon Co. v. Stentor Electric Manufacturing Co., 313 U.S. 487 (1941), a federal court sitting in diversity must apply the choice-of-law rules of the forum state. The district court below applied a federal choice-of-law analysis. That was error: New York's choice-of-law framework — not the Restatement (Second) of Conflicts as the district court appeared to assume — governs the interpretation of the parties' Delaware-law clause.
B. The Hanna Refinement Does Not Apply
Appellee invokes Hanna v. Plumer, 380 U.S. 460 (1965) for the proposition that the Federal Rules of Civil Procedure trump conflicting state procedural rules. That is correct as a general matter, but Hanna's rule applies only where a Federal Rule of Civil Procedure is on point — here, no such Rule speaks to substantive choice-of-law analysis. Hanna therefore offers Appellee no escape from Erie's basic command.
C. The Modern Erie Framework Confirms This Conclusion
The Supreme Court's most recent extensive treatment of Erie, Shady Grove Orthopedic Associates v. Allstate Insurance Co., 559 U.S. 393 (2010), reaffirms the two-step inquiry: first, whether a Federal Rule of Civil Procedure governs the question (it does not here); second, whether applying state law would impair Erie's twin aims of preventing forum shopping and avoiding inequitable administration of laws (applying New York substantive law plainly serves both aims). Either path leads to the same conclusion.
CONCLUSION
The district court's application of federal common law to a state-law contract dispute violated the bedrock rule of Erie and its progeny. This Court should reverse and remand for application of New York substantive law and choice-of-law principles.