The Erie doctrine is usually understood as a limitation on federal courts’ power. The Article concerns the unexplored role that the Erie doctrine has in limiting the power of state courts.
According to Erie Railroad Co. v. Tompkins, a federal court must follow state supreme court decisions when interpreting state law. But at the time that Erie was decided, some state supreme courts were still committed to Swift v. Tyson. They considered the content of their common law to be a factual matter, concerning which federal (and sister state) courts could make an independent judgment. Indeed, the Georgia Supreme Court still views its common law this way. In order to explain Justice Brandeis’s conclusion in Erie that state supreme court decisions bind federal courts, even when the state supreme court does not want them to be binding, a premise must be added to his argument—one that limits state supreme court power in this area.
The missing premise is a non-discrimination principle that is a hitherto unrecognized—but essential—part of the Erie doctrine. A state supreme court can free federal courts of the duty to follow its decisions only if it is willing to free domestic courts of the same duty. It cannot discriminate concerning the binding effect of its decisions on the basis of whether the effect is in domestic or federal court.
A similar puzzle arises when a federal court interprets unsettled state law. The Supreme Court has suggested that a federal court should predict how the relevant state supreme court would decide. But many state supreme courts—including the New York Court of Appeals—have indicated that they do not care if federal (or sister-state) courts use the predictive method concerning their unsettled law. Here, too, the nondiscrimination principle latent in Erie explains how the Supreme Court can demand that federal courts adopt the predictive method, whatever a state supreme court has said about the matter.