Law Applied by the Federal District Judge in This Case

Summary of Facts

• Mary and Hanna are Tennessee residents.
• Franco is a Mississippi resident.
• The accident occurred in Mississippi.
• Franco sues Mary in federal court in Mississippi for $100,000 (medical bills and lost wages).

Applicable Law In this scenario, the federal court has jurisdiction because of diversity of citizenship (the parties are from different states) and the amount in controversy exceeds $75,000. However, the key question is what law the federal judge will apply to decide the case. Federal vs. State Law in Diversity Cases

• In diversity jurisdiction cases (where the federal court hears a case solely because the parties are from different states), the federal court does not apply federal substantive law to the underlying dispute.
• Instead, under the Erie Doctrine (from Erie Railroad Co. v. Tompkins), the federal court must apply the substantive law of the state in which it sits -in this case, Mississippi law-to resolve the substantive issues of the case, such as liability and damages for a car accident

• The federal court will apply federal procedural rules (such as the Federal Rules of Civil Procedure) to manage the litigation process, but all substantive matters (e.g., rules of negligence, damages, defenses) will be governed by the law of Mississippi, where the accident occurred and where the court is located

Conclusion

In deciding Franco’s lawsuit against Mary, the federal district judge in Mississippi will apply Mississippi state law to the substantive issues of the case, not federal law

This approach ensures that the outcome of the case would be substantially the same as if it were tried in a Mississippi state court.