The Federal Equity Power
Michael T. Morley, Th e Federal Equity Power
The Federal Equity Power
Michael T. Morley 0 1 2
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II. AMERICAN EQUITY PRIOR TO ERIE .......................................................................................... 230
A. Equity Jurisdiction .............................................................................................................. 232
B. Equity Procedure ................................................................................................................ 236
1. Injunctions Under Rule 65 .............................................................................................. 252
2. Receivers Under Rule 66 ................................................................................................ 255
1. Federalism...................................................................................................................... 267
2. Separation of Powers ...................................................................................................... 270
3. Equity and Federal Common Law ................................................................................. 273
MICHAEL T. MORLEY*
Abstract: Throughout the first century and a half of our nation’s history, federal
courts treated equity as a type of general law. They applied a uniform,
freestanding body of principles derived from the English Court of Chancery to all
equitable issues that came before them, regardless of whether a case arose under
federal or state law. In 1945, in Guaranty Trust Co. v. York, the United States
Supreme Court held that, notwithstanding the changes wrought by the Erie
Doctrine, federal courts may continue to rely on these traditional principles of equity
to determine the availability of equitable relief, such as injunctions, even in
cases arising under state law. This so-called “equitable remedial rights doctrine” is
based on an anachronistic misunderstanding of the nature of the federal equity
power. Equity should not be understood as a single, independent body of
principles that a federal court must apply in all cases that come before it. Rather, a
federal court’s power to impose an equitable remedy stems, if at all, from the
legal authority that establishes the underlying right. For state-law claims, a federal
court must apply state statutes and precedents—not uniform, centrally devised
federal standards—to determine the availability of equitable relief. The manner
in which state-created rights are protected is as much a matter of substantive
state policy as a state’s initial creation and allocation of those rights. When
adjudicating a federal statutory claim, the underlying federal statute itself governs
the availability of equitable relief; a federal court may presume Congress
intended that traditional equitable principles apply as a matter of statutory
interpretation, unless the statute’s text or legislative history contains a clear statement
to the contrary. Finally, for constitutional claims, federal courts may apply
tra© 2018, Michael T. Morley. All rights reserved.
* Associate Professor of Law, Barry University School of Law. Climenko Fellow and
Lecturer on Law, Harvard Law School, 2012–14; Yale Law School, J.D., 2003; Princeton University,
Woodrow Wilson School of Public & International Affairs, A.B., magna cum laude, 2000. I am
grateful for comments and feedback I received at the Junior Faculty Federal Courts Workshop at
the University of Georgia, the Junior Faculty Federal Courts Workshop at Emory University
School of Law, the New Scholars panel at the 2015 Southeastern Association of Law Schools
Annual Conference, the Junior Faculty Works-in-Progress colloquium at Marquette University
School of Law, the Developing Ideas Conference at the University of Kentucky Law School, and
a faculty workshop at Barry University School of Law. I am especially grateful to Samuel Bray,
Heather Elliott, Steve Friedland, Jack Goldsmith, Douglas Laycock, Nancy Leong, John
Leubsdorf, Jake Linford, Thomas B. Metzloff, Chad Oldfather, James E. Pfander, Doug
Rendleman, Caprice Roberts, Ryan Scoville, and Fred Smith, Jr. for their comments on earlier drafts. I
also wish to acknowledge Matthew Rapkowski and the entire staff of the Boston College Law
Review for their extraordinary work in editing this piece.
ditional equitable principles as a matter of constitutional common law, unless
Congress displaces them with a valid alternative remedial scheme.
Under what circumstances should a federal court grant equitable relief,
such as an injunction, in a diversity case?1 The answer to this deceptively
simple question implicates profound issues going to the root of both
federalism and separation of powers, and has wide-ranging ramifications for our
modern conception of the federal judiciary’s equity power. In 2006, in eBay
Inc. v. MercExchange, L.L.C., the United States Supreme Court articulated its
well-known four-factor test for granting injunctive relief, which it claimed
was derived from principles historically applied by the English Court of
Chancery.2 Many states, in contrast, have their own, differing standards for
injunctive relief; rather than applying a balancing test, several states either
require or prohibit the award of injunctive relief in certain types of cases.3 A
court’s decision as to whether to apply federal or state standards for granting
an injunction may, in many cases, determine a litigant’s ability to obtain
interim or final relief.
Part of the difficulty underlying this choice-of-law issue stems from Erie
Railroad Co. v. Thompkins.4 Erie, as construed in cases such as the 1965
Supreme Court decision Hanna v. Plumer, directs federal courts to apply state
law for “substantive” issues and federal law for “procedural” issues in cases
arising under state law.5 Some scholars contend, however, that remedies are
neither purely procedural nor substantive but rather share attributes of both (a
position I reject).6 Consequently, many remedial issues fit awkwardly at best
within the Erie framework.7
More fundamentally, the federal judiciary’s conception of its equity
power is anachronistic, rooted in a pre-Erie framework. Federal courts often
treat equity as an independent body of law that is binding upon them of its
own force,8 akin to the general law that Erie repudiated.9 In 1945, in
Guaranty Trust Co. v. York,10 one of the United States Supreme Court’s major
postErie cases, the Court partly endorsed this understanding. Guaranty Trust
requires federal courts to apply a uniform body of equitable principles tracing
back to the English Court of Chancery—as interpreted by the Supreme
Court—when deciding whether to grant equitable relief, regardless of
whether the underlying claim arises under federal or state law.11 Several
commentators termed this principle the “equitable remedial rights doctrine.”12
This prevailing understanding of equity law is irredeemably flawed.
This Article proposes a new understanding of the federal judiciary’s equity
power. Equity should not be understood as a single, freestanding body of
principles that federal courts must apply regardless of whether a case arises
under federal or state law. Neither the U.S. Constitution, federal law, nor the
Federal Rules of Civil Procedure authorizes federal courts to craft and apply a
uniform body of equitable principles, including equitable remedial principles,
to all claims that come before them, regardless of the source of law from
which a claim arises. The assertion of such authority exceeds
federalismbased limits on the federal government’s power as a whole, the scope of
federal courts’ Article III judicial power, the judiciary’s authority under the Rules
of Decision Act,13 and the policy considerations underlying Erie itself.
The source of a federal court’s power to impose an equitable remedy
comes, if at all, from the legal authority that establishes the underlying right,
whether it is state common law, a state statute or constitution, a federal
statute, or the U.S. Constitution. Just as each state is free to craft its own body of
common law that federal courts are bound to enforce, it should likewise have
the power to develop its own equitable rules and principles that are equally
binding in both state and federal court, even for remedial issues. Federal
courts should apply state statutes and precedents, rather than federal equitable
principles, in deciding whether to grant equitable relief for claims arising
under state law.
8 See, e.g., infra note 23; see also infra notes 218–225 and accompanying text.
9 Erie, 304 U.S. at 78.
10 326 U.S. 99, 104–05 (1945).
12 Comment, The Equitable Remedial Rights Doctrine, 55 YALE L.J. 401, 416–17 (1945);
Note, The Equitable Remedial Rights Doctrine: Past and Present, 67 HARV. L. REV. 836, 836,
843–44 (1954) [hereinafter Past and Present].
13 28 U.S.C. § 1652 (2012).
Federal equity law should be reconceptualized as the body of principles
that courts presumptively apply in the absence of contrary federal statutory
requirements when deciding whether to grant equitable relief under the U.S.
Constitution or a federal statute. Congress may decide how statutory rights it
creates should be enforced.14 When a federal law provides for an equitable
remedy such as an injunction, a court may presume Congress intended to
implicitly incorporate and rely upon traditional equitable principles as a matter
of statutory interpretation, in the absence of express language to the contrary
in the law’s text or legislative history.15 When enforcing constitutional
restrictions, federal courts are free to apply those traditional equitable principles
as a matter of constitutional common law, unless Congress displaces them
with an alternate remedial scheme.16 In short, in a post-Erie world, equity
stems from and follows the law. Guaranty Trust should be interred as a
lingering remnant of a pre-Erie legal positivist era.
Prior to Erie, numerous commentators explored the effects of state
statutes and court rulings on federal equitable principles.17 In the decades since,
14 Standing and related doctrines limit Congress’ power to authorize the enforcement of
federal laws through private rights of action. See Michael T. Morley, Spokeo: The Quasi-Hohfeldian
Plaintiff and the Non-Federal Federal Question, GEO. MASON L. REV. (forthcoming 2018)
(manuscript at 8–9), https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2946482 [https://perma.cc/
15 See infra notes 432–436 and accompanying text. Of course, extensive debates exist over
whether courts may rely on legislative history when construing or applying federal statutes. See
WILLIAM N. ESKRIDGE, JR. ET AL., CASES AND MATERIALS ON LEGISLATION: STATUTES AND
MATERIALS ON THE CREATION OF PUBLIC POLICY 956 (3d ed. 2001) (collecting sources). This
Article’s conclusions apply with equal force even if limited solely to the text of the statute itself.
16 See infra notes 437–439 and accompanying text.
17 See, e.g., N.C. Collier, Limitations on Federal Courts in Administering State Law, 75
CENT. L.J. 330, 336 (1912) (arguing that a federal court in equity should act as “purely a substitute
jurisdiction” for state courts, to protect defendants’ rights); Robert von Moschzisker, Equity
Jurisdiction in the Federal Courts, 75 U. PA. L. REV. 287, 301 (1927) (contending that the “truly
national” system of equity had the “strength and flexibility” necessary to “meet the demands of
changing conditions which require equitable treatment”); Note, Effect of State Laws on the Equity
Jurisdiction of the Federal Courts, 3 VA. L. REV. 227, 230–32 (1915) [hereinafter Effect of State
Laws] (explaining that state statutes may not expand a federal court’s equity jurisdiction, yet
sometimes effectively do so by creating new substantive rights that a federal court sitting in equity
must enforce); Note, The Effect of State Statutes on Equity Jurisdiction in the Federal Courts, 33
YALE L.J. 193 (1923) [hereinafter The Effect of State Statutes] (arguing that federal courts should
enforce state statutes creating new forms of equitable relief only when the common law did not
provide relief under similar circumstances); Note, Equity Jurisdiction of a Federal Court to Set
Aside a Will by Force of a State Statute, 3 COLUM. L. REV. 47 (1903) [hereinafter Equity
Jurisdiction] (discussing various circumstances in which a federal court would not enforce state statutes in
equity cases); Note, State Laws in Federal Courts of Equity, 4 COLUM. L. REV. 589, 590 (1904)
(arguing that federal courts sitting in equity should apply uniform federal equitable standards in
diversity cases, except “in matters which are essentially local,” such as property disputes or cases
involving marital rights); Note, State Statutes and the Federal Equity Courts, 32 COLUM. L. REV.
some brief pieces considered the continuing validity of the equitable remedial
rights doctrine.18 Despite the voluminous body of literature on Erie, however,
the issue remains unresolved19 and books on remedies generally overlook it.
Commentators continue to reach conflicting conclusions concerning the
applicability of state equitable principles in federal court, and very few have
offered a comprehensive analysis of modern federal equity.20 The Supreme
688 (1932) (discussing various doctrines that limit the obligation of federal courts sitting in equity
to enforce state statutes).
18 The Equitable Remedial Rights Doctrine, supra note 12, at 416–17 (arguing that federal
courts should treat remedial issues as “substantive[,]” requiring them to apply state law); Past and
Present, supra note 12, at 843–44 (arguing that a “federal court in diversity matters should
ordinarily grant the same remedy that would be given in a state court” but apply federal standards to
“matters of judicial housekeeping” such as “supervision of receivers” and “enforcement of
19 RICHARD H. FALLON, JR. ET AL., HART & WECHSLER’S THE FEDERAL COURTS AND THE
FEDERAL SYSTEM 577 n.1 (6th ed. 2009) (“Scholars have disagreed on the appropriateness of
recognizing a special role for federal equity in fashioning remedies in cases falling within the
scope of the Erie doctrine.”); Laura S. Fitzgerald, Is Jurisdiction Jurisdictional?, 95 NW. U. L.
REV. 1207, 1248 n.172 (2001) (“There remains some disagreement over the scope of a federal
court’s authority when sitting in diversity to exercise federal equity powers in lieu of following
state rules.”); Past and Present, supra note 12, at 839 (“[I]t is not clear whether the overruling of
Swift by Erie R.R. v. Tompkins destroys the remedial rights doctrine, especially since many of the
cases espousing that doctrine disregarded state statutes as well as decisions.”).
20 Professor David Crump raised the equitable remedial rights issue as a vehicle for
advocating that Erie questions be resolved based on a modified version of the interest-balancing test of
Byrd v. Blue Ridge Rural Electrical Cooperative, Inc., 356 U.S. 525 (1958). Crump, supra note 6,
at 1235, 1272–73 (concluding that federal courts should apply state law standards in determining
whether to grant equitable relief for claims arising under state law, except when “strong federal
interests overcome weaker state ones”); see also Arthur D. Wolf, Preliminary Injunction
Standards in Massachusetts State and Federal Courts, 35 W. NEW ENG. L. REV. 1, 47–48, 53 (2013)
(arguing that, under Hanna v. Plumer, federal courts should apply state law to determine whether
to issue a preliminary injunction); Note, Problems of Parallel State and Federal Remedies, 71
HARV. L. REV. 513, 519 (1958) (arguing that federal courts should apply state law equitable and
remedial principles in state-law cases where the choice of such principles would “actually
influence the parties’ prelitigation conduct” and uniform federal principles concerning equitable
remedies in all other cases).
Professor John T. Cross urged the opposite perspective, arguing that the Constitution gives
federal judges the power to apply “a separate body of federal equity law,” based on the principles
that the English Court of Chancery employed in the eighteenth century, in both state and federal
cases. John T. Cross, The Erie Doctrine in Equity, 60 LA. L. REV. 173, 175, 214, 226 (1999).
More recently, Professor David E. Shipley urged the same conclusion specifically with regard to
the standards governing preliminary injunctions. David E. Shipley, The Preliminary Injunction
Standard in Diversity: A Typical Unguided Erie Choice, 50 GA. L. REV. 1169 (2016). He contends
that such standards are procedural because they are not likely to affect a plaintiff’s choice of
forum, and neither dictate the ultimate outcome of a case nor create the type of inequality among
litigants that Erie condemns. Id. at 1217–18, 1221. Wright and Miller’s Federal Practice and
Procedure treatise adopts something of a compromise position, declaring that federal standards
should govern interim relief such as preliminary injunctions, while state law standards generally
should govern permanent relief, except in “exceptional cases” where applying federal standards
would allow federal courts to “effect justice expeditiously or creatively.” 19 CHARLES ALAN
Court has recognized the choice-of-law problem concerning the proper
standard for equitable relief in state-law cases, but declined to address it on the
merits.21 Lower federal courts have adopted a variety of approaches, many
either avoiding the issue22 or choosing to apply federal equitable standards
pursuant to Guaranty Trust.23 This Article presents a comprehensive analysis
of Erie’s application to equity, offering a new understanding of the federal
equity power, particularly with regard to remedial issues.
Part I of this Article begins by tracing the development of equity law in
England.24 Part II explores equity’s adoption in the United States, explaining
that federal courts treated it analogously to general law under the Supreme
Court’s 1842 decision in Swift v. Tyson.25 Part III goes on to show that the
Supreme Court partly preserved this conception of federal equity law, despite
Erie, in Guaranty Trust.26 Part IV demonstrates that neither the U.S.
Constitution, federal law, nor the Federal Rules of Civil Procedure provides a basis for
recognizing a uniform or freestanding body of equitable principles that
federal courts are bound to apply to all cases that come before them, including for
This Part also offers a new conception of equity: the equitable principles
a court must apply to a claim arise from the source of law giving rise to that
cause of action. Equitable relief for state-law claims should be determined by
state law, including state statutes and precedents. For federal statutory claims,
a court may presume, in the absence of contrary evidence, that Congress
implicitly incorporated into the statute traditional equitable principles of the
English Court of Chancery as construed by the Supreme Court.28 Likewise,
for claims under the U.S. Constitution, courts may apply those traditional
equitable principles as a matter of constitutional common law, unless Congress
has created an alternate remedial scheme. In cases involving a mix of state
and federal claims, a litigant may be entitled to equitable relief under one set
of standards, but not the other. The Conclusion summarizes this Article’s
Commentators have adopted numerous, conflicting interpretations of the
Erie Doctrine. The arguments here are intended to be “Erie agnostic”: equally
applicable regardless of whether one believes the Erie Doctrine is rooted in
federalism-based limits on the federal government’s power,
separation-ofpowers limits on the federal judiciary’s power, statutory interpretation of the
Rules of Decision Act, or merely sound policy considerations.
I. THE ORIGIN AND DEVELOPMENT OF EQUITY
The Supreme Court has repeatedly held that federal courts are generally
required to apply the same principles of equity as the English Court of
Chancery did in 1789.30 Before assessing the legal and constitutional rationale for
25 See infra notes 81–181 and accompanying text.
26 See infra notes 182–227 and accompanying text.
27 See infra notes 228–441 and accompanying text.
28 See eBay Inc. v. MercExchange, L.L.C, 547 U.S. 388, 394 (2006); Winter v. Natural Res.
Def. Council, 555 U.S. 7, 20 (2008).
29 See infra Conclusion.
30 Grupo Mexicano, 527 U.S. at 319 (considering whether “the relief respondents requested
here was traditionally accorded by courts of equity”); Atlas Life Ins. Co. v. W.I. S., Inc., 306 U.S.
563, 568 (1939) (holding that federal courts have “authority to administer in equity suits the
principles of the system of judicial remedies which had been devised and was being administered by
the English Court of Chancery at the time of the separation of the two countries”).
this principle, it is helpful to lay a foundation by examining the nature and
development of equity in England.
Equity evolved in England as a natural outgrowth of the King’s inherent
power and duty to do justice.31 In the years following the Norman Conquest,
most legal business was conducted in county or manorial courts; no royal
courts existed at the time.32 When a person could not obtain adequate relief
from a local court—for example, due to the social position or connections of
his adversaries33—he could directly petition the King for aid. As the
“fountain of justice,”34 the King could grant relief when ordinary legal institutions
were insufficient, unwilling, or unable to do so.35 The King could issue a writ
directing the lord of the manor or some public official to do “full right” to the
plaintiff, or else directly order a respondent to take (or refrain from taking)
By the late twelfth century, to alleviate the need for people to seek relief
directly from the Crown, the royal courts of King’s Bench, Exchequer, and
Common Pleas began to develop outside the main legal system of county and
manorial courts,37 each with jurisdiction over different types of cases. There
were very few statutes and precedents; these courts resolved disputes based
on both law and equitable principles without distinguishing between them,38
and granted relief such as the Writ of Prohibition and the Writ of Estrepment
that resembled injunctions in many ways.39
To initiate a lawsuit in a royal court, a plaintiff had to obtain a royal writ
from the Chancellor. The Chancellor was a member of the King’s royal
council, or curia, who kept the royal seal and issued documents in the name of the
Crown.40 In the earliest years of the royal courts, the Chancellor had authority
to craft writs based on the specific circumstances of each case, allowing
plaintiffs to pursue claims as justice demanded.41 Over the course of the
thirteenth century, other governmental institutions greatly circumscribed the
Chancellor’s power to craft new types of writs. The royal courts often refused
to accept new writs, asserting for themselves the prerogative to determine
whether to recognize new rights.42 Likewise, Parliament claimed for itself the
power to create new writs.43
The Court of Common Pleas’ refusal to recognize new writs caused the
common law to ossify. As Common Pleas increased in size and grew more
distant from the Crown over the mid-fourteenth century, it became reluctant
to exercise the King’s royal prerogative to adjudicate cases based on equitable
considerations.44 Moreover, the common-law lawyers who had largely
supplanted clerics as judges on the court were more inclined to base their rulings
on the common law rather than canon law or equitable principles.45
The reluctance of Common Pleas to embrace new grounds for relief
compelled many people to seek relief directly from the King and his royal
council. As the number of such petitions increased, the council delegated
responsibility for considering them to the Chancellor.46 By 1400, complainants
presented their petitions directly to the Chancellor.47 A Court of Chancery
gradually developed around the Chancellor to facilitate his role.
During the early years of the Chancery Court, most Chancellors were
bishops because they were among the only literate people in the
government.48 Chancellors thus tended to be familiar with, and rely upon,
ecclesiastic and Roman law, as well as the writings of Catholic scholars such as
Thomas Aquinas, rather than the common law.49 It was through Aquinas’
works that Aristotle’s conception of equity made its way into English law.50
40 Timothy S. Haskett, The Medieval English Court of Chancery, 14 L. & HIST. REV. 245,
41 1 WILLIAM SEARLE HOLDSWORTH, A HISTORY OF ENGLISH LAW 398
(A.L. Goodhart &
H.G. Hanbury eds., 7th ed. 1956)
42 PLUCKNETT, supra note 31, at 164.
43 See Willard Barbour, Some Aspects of Fifteenth-Century Chancery, 31 HARV. L. REV. 834,
44 1 HOLDSWORTH, supra note 41, at 447–48, 454.
45 2 id. at 345.
46 1 id. at 339–402, 404; PLUCKNETT, supra note 31, at 180–81; see also PETER CHARLES
HOFFER, THE LAW’S CONSCIENCE: EQUITABLE CONSTITUTIONALISM IN AMERICA 26 (1990).
47 J.H. BAKER, AN INTRODUCTION TO ENGLISH LEGAL HISTORY 117 (3d ed. 1990).
48 3 WILLIAM BLACKSTONE, COMMENTARIES *47; Haskett, supra note 40, at 247.
49 See CHRISTOPHER ST. GERMAN, THE REPLICATION OF A SERJEANT AT THE LAWS OF
ENGLAND (1787), reprinted in J.A. GUY, CHRISTOPHER ST. GERMAN ON CHANCERY AND STATUTE
101 (J.A. Guy ed., Selden Soc’y 1985) (alleging that English Chancellors “had but superficiall
Aquinas’ Commentary on the Nicomachean Ethics explains, “[B]y
equity a person is obedient in a higher way when he follows the intention of the
legislator where the words of the law differ from it.”51 Aquinas emphasized
that human reason is limited, and legislators therefore cannot perfectly
recognize and capture all the details and nuances of natural law.52 Judges must
invoke equity to correct inevitable defects in the law, thereby better enforcing
natural justice. In Aquinas’ view, the “nature of the equitable is that it be
directive of the law where the law is deficient for some particular case . . . .
Because the material of human acts is indeterminate . . . the law must be
indeterminate in the sense that it is not absolutely rigid.”53 Aquinas’ Summa
Theologica offered an affirmative response to the question of “Whether He who is
Under a Law May Act Beside the Letter of the Law.”54 It explains that “if a
case arise[s] wherein the observance of that law would be hurtful to the
general welfare, it should not be observed.”55
Applying this conception of equity, Chancellors exercised extremely
broad discretion, doing justice in individual cases based on their personal
notions of fairness, informed by natural law principles, despite the common
law’s limits.56 “[E]quity courts interpreted documents loosely, often to the
extent of rewriting them, in order to achieve a result that the Chancellor
believed to be just . . . . Likewise, statutes which produced unjust results were
interpreted in contorted and fanciful ways to avoid unjust outcomes.”57
knowledge of the lawes of the realme”); HENRY SUMNER MAINE, ANCIENT LAW 36 (Dorset Press
50 Aristotle wrote that a statute may be unjust as applied to certain situations not contemplated
by its drafters. He explained that epieikeia—which is typically translated as “equity” or “fair–
mindedness,” Anton-Hermann Chroust, Aristotle’s Conception of “Equity” (Epieikeia), 18 NOTRE
DAME L. REV. 119, 125–26 (1942); Lawrence B. Solum, Natural Justice, 51 AM. J. JURIS. 65, 99–
100 (2006)—is the “correction of law, where law falls short because of its universality.”
ARISTOTLE, RHETORIC 1374a (David J. Furley & Alexander Nehamas eds. 1994). When a statute is
broadly written, a court must apply it by “say[ing] what the legislator himself would have said had
he been present, and would have put into his law if he had known [about this particular case].”
ARISTOTLE, NICOMACHEAN ETHICS 141–42 (Martin Ostwald, trans. Bobbs–Merrill, 1962).
“[W]hen the law speaks universally,” he elaborated, “and a case arises on it which is not covered
by the universal statement, then it is right, when the legislator fails us and has erred by
oversimplicity, to correct the omission.” Id.
51 1 THOMAS AQUINAS, COMMENTARY ON THE NICOMACHEAN ETHICS 466 (C.I. Litzinger
52 Id. at 467–68.
53 Id. at 466.
54 1 THOMAS AQUINAS, SUMMA THEOLOGICA 1021 (Richard C. Meyer trans., 1947).
56 1 HOLDSWORTH, supra note 41, at 467; F.W. MAITLAND, THE CONSTITUTIONAL HISTORY
OF ENGLAND 225–26 (H. Fisher ed. 1920).
57 John R. Kroger, Supreme Court Equity, 1789-1835, and the History of American Judging,
34 HOUS. L. REV. 1425, 1435 (1998).
Commentators often claimed that the Chancellor applied natural law or
followed the dictates of his “conscience.”58 The unavoidably subjective aspects
of equity led to the criticism that equity varied with the length of the
The Court of Chancery was not bound by strict notions of precedent;60
indeed, throughout Chancery’s early history, written rulings were not even
published or widely available. The court recognized and enforced a broad
range of equitable rights that could not be asserted in common-law courts,
such as rights relating to trusts and uses.61 It was primarily responsible for
many other areas of law, as well, including agency law, partnerships, and
suretyships, and recognized defenses unavailable at law, such as fraud.62
Equity enabled the continued development of the law despite the rigidity of
the common-law courts.63
Chancery also offered a much broader range of remedies than were
available at law.64 Whereas Common Pleas could only issue a judgment that
entitled the plaintiff to attempt to obtain a specified amount of money from
the defendant, equity could issue injunctions that prohibited the defendant
from taking certain acts or required him to do so.65 A court of equity could
attempt to prevent harm before it even occurred, whereas the common law
offered only an ex post remedy.66 Relief in equity thus tended to be specific,
rather than substitutionary.67
In 1528, Christopher St. Germain published Doctor and Student, a
dialogue between a doctor of divinity and an English barrister, discussing the
relationship between English law and personal conscience.68 The book
offered one of the first in-depth accounts of English equity and was among the
most important compilations of English law prior to Blackstone’s
Commentaries. St. Germain presented equity in terms of Aristotle’s conception of
58 HOFFER, supra note 46, at 26; see also BAKER, supra note 47, at 118 (describing Chancery
as “a court of conscience, in which defendants could be coerced into doing whatever conscience
required in the full circumstances of the case”).
59 JOHN SELDEN, TABLE TALK 49 (Books for Libraries Press 1972) (1855).
60 Kroger, supra note 57, at 1435.
61 HOFFER, supra note 46, at 29.
62 5 HOLDSWORTH, supra note 41, at 292; PLUCKNETT, supra note 31, at 688–89.
63 2 HOLDSWORTH, supra note 41, at 346–47.
64 3 BLACKSTONE, supra note 48, at *439.
65 1 HOLDSWORTH, supra note 41, at 458.
67 Cf. LAYCOCK, supra note 6, at 5–6 (discussing difference between specific and
68 See generally CHRISTOPHER ST. GERMAIN, DOCTOR AND STUDENT (1528).
69 See supra note 50.
By this time, the Chancery Court was limited to equitable jurisdiction; it
could grant relief only when a party lacked an adequate remedy at law.70 The
common law could be inadequate in many ways: a defendant may be too
violent or powerful to sue in an ordinary court, the plaintiff might be unable to
satisfy a technical element or evidentiary requirement for obtaining relief at
law, the common law may lack a writ for the harm the plaintiff had suffered, a
common-law jury could be prejudiced against the plaintiff, or the defendant
may have subjected the plaintiff to multiple vexatious and frivolous suits at
In 1617, Bacon became the Lord Chancellor of England, and he sought
to transform equity into a more predictable, consistent system of law. He
compiled a code of 101 orders derived from earlier Chancery rulings to guide
chancellors in the exercise of their equitable discretion.72 By using prior
rulings as precedents, he enabled legal reasoning in Chancery to more closely
approximate the common-law courts and ensured greater consistency among
decisions.73 As a result of Bacon’s reforms, attorneys practicing in Chancery
began to cite cases.74
During the English Civil War (1642-1651) and Interregnum
(16491660), Chancery was viewed with great suspicion. “As a prerogative court, it
was subject to the same suspicion as its far more obnoxious and politically
active counterpart, the Star Chamber.”75 Following the Restoration, Chancery
became more conservative, curbing its discretion.76 After becoming
Chancellor in 1673, Lord Nottingham—whom Holdsworth calls the “Father of
Modern Equity”77—compiled a manual of Chancery practice setting forth
principles to guide and restrict the availability of equitable relief such as
injunctions. Though the manual itself was unpublished, Nottingham’s rulings as
Chancellor were consistent with it. Holdsworth explains that Nottingham
“began the work of organizing and systematizing the principles upon which
the court acted; and, as a result of his work, equity began to assume its final
70 Raack, supra note 39, at 555.
71 Id. at 555–61 (collecting cases).
72 15 THE WORKS OF FRANCIS BACON 347–72 (J. Spedding ed. 1861); see also 5
HOLDSWORTH, supra note 41, at 193.
73 PLUCKNETT, supra note 31, at 690. Precedent was not universally accepted as a valid
source of authority in Chancery. See Fry v. Porter, 86 ENG. REP. 898, 902 (1670) (“[I]f there be
equity in a case, that equity is an [sic] universal truth, and there can be no precedent in it.”).
74 5 HOLDSWORTH, supra note 41, at 337. Bacon was later impeached and removed from
office for taking bribes, though King James I pardoned him. HOFFER, supra note 46, at 34–35.
The possibility for such corruption was one source of concern about the Chancellor’s purportedly
unlimited discretion to apply equity according to his conscience.
75 HOFFER, supra note 46, at 28.
77 5 HOLDSWORTH, supra note 41, at 150.
form.”78 Over the century that followed, the law of equity would become, in
Holdsworth’s view, “completely fixed.”79
Thus, over time, equity matured from a series of ad hoc, case-by-case
rulings to a set of principles structurally similar to—although different in
substance from—the common law. As a result of the efforts of Chancellors such
as Bacon and Nottingham, English equity could accurately be characterized
as a distinct body of law. Blackstone concluded that equity is a “connected
system, governed by established rules, and bound down by precedents, from
which [Chancellors] do not depart, although the reason of some of them may
perhaps be liable to objection.”80
II. AMERICAN EQUITY PRIOR TO ERIE
The thirteen colonies adopted dramatically different approaches to
equity.81 Several colonies, following the English model, established separate
common-law and chancery courts,82 while others permitted their
commonlaw courts of general jurisdiction to entertain equitable claims, as well.83
Some colonies entirely excluded equity from their judicial systems,84 instead
allowing the governor and governor’s council to exercise the equity power.85
Many Americans were deeply skeptical of the broad discretion entrusted to
equity courts, finding the notion of equity antithetical to the rule of law. They
regarded equitable discretion to temper or disregard legal principles “as an
appanage of the Crown’s prerogative, and, therefore, inimical to their
At the Constitutional Convention, the original draft of the Constitution
did not contain any references to equity.87 The proposal to grant federal courts
equity jurisdiction arose very late in the process, in late August. William
Johnson “suggested that the judicial power ought to extend to equity as well
as law.”88 George Read, a delegate from Maryland, “objected to vesting these
powers in the same court.”89 Without further debate, the proposal passed by a
vote of six states to two states.90
A few opponents of the Constitution objected to the judiciary’s equity
power during the ratification debates, but it was not a major flashpoint.91 One
prominent Anti-Federalist, Brutus, warned that granting judges equitable
powers would permit them to ignore the plain text of laws and constitutional
provisions and enforce their personal will.92 Another cautioned that it was
“dangerous” to “vest in the same judge power to decide on the law, and also
general powers in equity; for if the law restrain him, he is only to step into his
shoes of equity, and give what judgment his reason or opinion may dictate.”93
The Federalist Papers defended Article III’s jurisdictional grant over
cases in equity by explaining that federal courts need the power to fairly
adjudicate cases otherwise within their jurisdiction that involve “ingredients of
fraud, accident, trust, or hardship.”94 Alexander Hamilton later elaborated,
“The great and primary use of a court of equity is to give relief in
extraordinary cases, which are exceptions to general rules.”95
For more than a century after the Founding, federal courts treated equity
as an independent body of law they were required to apply, typically
regardless of state statutes or state court rulings to the contrary. They generally
distinguished among four types of issues relating to equity to which different
constitutional provisions, statutory restrictions, and other doctrines applied:
jurisdictional, procedural, remedial, and substantive. Of course, the
boundaries among these categories often were indistinct and an equitable issue could
implicate multiple categories.
A. Equity Jurisdiction
The Constitution provides that federal courts may exercise jurisdiction
over cases and controversies “in Law and Equity.”96 Congress implemented
this jurisdiction in section 11 of the Judiciary Act of 1789,97 which gave
federal circuit courts “original cognizance, concurrent with the courts of the
several States,” over certain “suits of a civil nature at common law or in
equity.”98 This jurisdictional grant extended to matters in which the amount in
controversy exceeded $500, and either the Government was a plaintiff, an
alien was a party, or the case involved litigants from different states.99 The
Judiciary Act also authorized the Supreme Court to hear appeals from circuit
courts in equity cases.100
Section 16 of the Judiciary Act went on to limit the federal courts’
equitable jurisdiction, stating, “[S]uits in equity shall not be sustained in . . .
courts of the United States, in any case where a plain, adequate and complete
remedy may be had at law.”101 The Judiciary Act further provided that suits in
equity were not to be tried by jury.102 These restrictions complemented the
Seventh Amendment,103 which provides, “In Suits at common law, where the
value in controversy shall exceed twenty dollars, the right of trial by jury
shall be preserved . . . .”104 The Seventh Amendment prohibits a federal court
from hearing a case in equity when the plaintiff has an adequate remedy at
law, thereby preserving the defendant’s right to a jury trial for common law
Together, the Judiciary Act and the Seventh Amendment created a
remedial hierarchy, institutionalizing a preference for legal relief in the federal
courts;106 a claimant was relegated to legal, rather than equitable, relief when
it was available.107 These provisions greatly limited the range of state laws
and precedents a federal court sitting in equity would follow and required
legal and equitable claims to be adjudicated on different “sides” of the
To determine whether a plaintiff’s claim—including claims arising
under state law—sounded in law or equity for purposes of section 16 of the
Judiciary Act and the Seventh Amendment, a federal court applied “the
principles of common law and equity” from England.109 The federal judiciary’s
equitable jurisdiction “embrac[ed] all the subjects of which the High Court of
Chancery in England had judicial cognizance at the time of the adoption of
the Constitution.”110 Federal courts sitting in equity could therefore hear any
equitable claims that could have been brought before the English Court of
Chancery in 1789, even in states that had granted their law courts jurisdiction
over some or all traditionally equitable claims111 or refused to recognize
equi104 U.S. CONST. amend. VII.
105 See Scott v. Neely, 140 U.S. 106, 110 (1891) (“[W]henever, respecting any right violated,
a court of law is competent to render a judgment affording a plain, adequate and complete remedy,
the party aggrieved must seek his remedy in such court,” in part “because the defendant has a
constitutional right to a trial by jury . . . .”); accord Hipp v. Babin, 60 U.S. (19 How.) 271, 278
(1857); see also Parsons v. Bedford, 28 U.S. (3 Pet.) 433, 447 (1830) (holding that the Seventh
Amendment’s guarantee of a civil jury applies in all “suits in which legal rights [a]re to be
ascertained and determined, in contradistinction to those” in which “equitable rights . . . and equitable
remedies” are at issue).
106 OWEN M. FISS, THE CIVIL RIGHTS INJUNCTION 38 (1978).
107 Hipp, 60 U.S. (19 How.) at 278.
108 Main, supra note 85, at 450.
109 Robinson v. Campbell, 16 U.S. (3 Wheat.) 212, 223 (1818); see also Tull, 481 U.S. at 417;
Parsons, 28 U.S. (3 Pet.) at 447; State Statutes and the Federal Equity Courts, supra note 17, at
110 Benjamin F. Keller, Jurisdiction of the Federal Equity Courts as Affected by State
Statutes, 47 AM. L. REV. 190, 190 (1913); accord Payne v. Hook, 74 U.S. (7 Wall.) 425, 430 (1869)
(“The equity jurisdiction conferred on the Federal courts is the same that the High Court of
Chancery in England possesses . . . .”).
111 See Miss. Mills v. Cohn, 150 U.S. 202, 206 (1893) (holding that the plaintiff could
proceed in equity in federal court, even though the law courts in the forum state could have
entertained the plaintiff’s claims, because a federal court’s equitable jurisdiction depended on whether,
under English equitable principles from “the time of the adoption of the Constitution . . . the
relief . . . sought was one obtainable in a court of law, or one which only a court of equity was fully
competent to give”); Sheffield Furnace Co. v. Witherow, 149 U.S. 574, 578, 579 (1893) (holding
ty at all.112 The Court repeatedly emphasized, “[T]he equity jurisdiction of the
courts of the United States cannot be impaired by the laws of the respective
states in which they sit.”113
Conversely, a federal court could not permit litigants to raise an
equitable claim114 or defense115 in an action at law, even when state courts would
permit them to do so.116 Characterization of a claim or defense as legal or
equitable depended on the historical practice of the English Court of
Chancery, rather than the rulings, jurisdictional limits, or practice of state courts.117
Consequently, all federal district courts exercised the same equitable
jurisdiction, despite differences in state laws and state court rulings concerning
that a federal court could entertain a bill in equity to enforce a mechanic’s lien, even though a state
statute “provide[d] for an action at law” to enforce mechanic’s liens, because “foreclosure of a
mechanic’s lien is essentially an equitable proceeding” and “a State, by prescribing an action at
law to enforce even statutory rights, cannot oust a Federal court, sitting in equity, of its
jurisdiction to enforce such rights, provided they are of an equitable nature”); Payne, 74 U.S. (7 Wall.) at
429–30 (holding that a federal court could exercise equity jurisdiction over a claim for an
accounting against an estate administrator despite the fact that state law prohibited the state chancery
court from hearing such claims and assigned exclusive jurisdiction to county probate courts).
112 Cohn, 150 U.S. at 205.
113 Kirby v. Lake Shore & Mich. S. R.R, 120 U.S. 130, 138 (1887) (applying equitable tolling
to state statute of limitations pursuant to federal equitable principles); see also Payne, 74 U.S. (7
Wall.) at 430 (“The equity jurisdiction conferred on the Federal courts is . . . subject to neither
limitation or restraint by State legislation . . . .”); Charles T. McCormick & Elvin Hale Hewins,
The Collapse of “General” Law in the Federal Courts, 33 ILL. L. REV. 126, 139 (1938) (“State
legislation or decisions could not enlarge or restrict the boundaries of Federal equity
jurisdiction.”); The Effect of State Statutes, supra note 17, at 193 (explaining that state statutes cannot
limit a federal court’s equitable jurisdiction); State Laws in Federal Courts of Equity, supra note
17, at 589 (“State statutes affecting equity in its concurrent jurisdiction were early held to have no
effect on the federal courts.”).
114 See Stratton v. St. Louis Sw. Ry. Co., 284 U.S. 530, 534 (1932) (holding that a federal
court could not enforce a state law authorizing equitable relief for overpayment of a tax because
“the remedy by suit to recover a tax which has been paid is essentially a legal remedy, and it is not
any the less so nor any the less adequate because the state practice has annexed to it an equitable
remedy”); Matthews v. Rogers, 284 U.S. 521, 528–29 (1932) (same).
115 Lantry v. Wallace, 182 U.S. 536, 549–50 (1901) (holding that a shareholder could not
raise an equitable defense in an action at law brought by a corporation’s receiver); Scott v.
Armstrong, 146 U.S. 499, 512 (1892) (holding that a federal court lacked jurisdiction to grant an
equitable set–off in an action at law, even though state law abolished the distinction between law and
equity); Robinson, 16 U.S. (3 Wheat.) at 220, 223 (holding that the defendant could not assert
equitable title to land in a common-law ejectment action in federal court).
116 See The Effect of State Statutes, supra note 17, at 194 (“[L]egal and equitable actions may
not be united in the federal courts . . . .”).
117 Robinson, 16 U.S. (3 Wheat.) at 222–23.
118 Payne, 74 U.S. (7 Wall.) at 430 (“The equity jurisdiction conferred on the Federal courts
is . . . subject to neither limitation or restraint by State legislation, and is uniform throughout the
different States of the Union.”); United States v. Howland & Allen, 17 U.S. (4 Wheat.) 108, 115
(1819) (holding that, because the Judiciary Act “confers the same chancery powers on all” federal
Similarly, when determining whether a litigant was barred from seeking
equitable relief due to an adequate remedy at law, a federal court could
consider only whether a legal remedy either existed under English common law
in 1789 or subsequently had been created by Congress.119 The adequacy of a
litigant’s remedy at law, and hence the availability of federal equitable relief,
did not depend on the remedies actually available to it under state law at the
time of the lawsuit. Consequently, a plaintiff for whom a legal remedy would
have existed in 1789 could not seek equitable relief in federal court, even if a
state statute or judicial ruling authorized it.120 Conversely, a state statute or
judicial ruling that created or recognized a new right that did not exist under
English law at the time of the Constitution’s ratification could not preclude a
plaintiff from seeking equitable relief that was otherwise available in federal
In many of these jurisdictional cases, the Court repeatedly emphasized
that, because section 16 of the Judiciary Act established the federal judiciary’s
equity jurisdiction, states could not expand or restrict that jurisdiction by
recognizing new common-law rights or refusing to recognize traditional ones.122
courts, a federal district court’s “jurisdiction in Massachusetts must be the same as in other
119 McConihay v. Wright, 121 U.S. 201, 206 (1887)
(“The adequate remedy at law, which is
the test of equitable jurisdiction in these courts is that which existed when the Judiciary Act of
1789 was adopted, unless subsequently changed by act of Congress.”)
; Keller, supra note 110, at
191; Effect of State Laws, supra note 17, at 228.
120 Scott, 140 U.S. at 109 (holding that a contract creditor could not seek equitable relief in
federal court to set aside a fraudulent conveyance pursuant to a state law, because “new equitable
rights created by the states” are unenforceable in federal court when they exceed the limits of
federal courts’ equitable jurisdiction or violate the Seventh Amendment guarantee of jury trials for
common-law claims); see also Hollins v. Brierfield Coal & Iron Co., 150 U.S. 371, 379 (1893)
(holding that a “simple contract creditor” may not seek equitable relief in federal court pursuant to
a state statute, because “[t]he line of demarcation between equitable and legal remedies in the
federal courts cannot be obliterated by state legislation”).
121 Smyth v. Ames, 169 U.S. 466, 516 (1898), overruled in part on other grounds by Fed.
Power Comm’n v. Nat. Gas Pipeline Co. of Am., 169 U.S. 418 (1942) (“One who is entitled to sue
in the federal circuit court may invoke its jurisdiction in equity whenever the established
principles and rules of equity permit such a suit in that court; and he cannot be deprived of that right by
reason of his being allowed to sue at law in a state court on the same cause of action.”);
McConihay, 121 U.S. at 206 (holding that a state statute creating a remedy at law of ejectment did not
bar a federal court from entertaining a claim in equity to quiet title because “no change in state
legislation giving . . . a remedy by action at law, can of itself curtail the jurisdiction in equity of
the courts of the United States”); see also Howland & Allen, 17 U.S. (4 Wheat.) at 108 (holding
that a federal court could exercise jurisdiction over an equitable claim, despite a state statute
creating a remedy at law).
122 McConihay, 121 U.S. at 206 (holding that a state statute creating a cause of action at law
“cannot have the effect to oust the jurisdiction in equity of the courts of the United States”);
Robinson, 16 U.S. (3 Wheat.) at 222 (holding that states could not “extinguish . . . the exercise of
equitable jurisdiction” by federal courts by recharacterizing or refusing to recognize equitable
claims or defenses).
hinge on “the fortuity that there is diversity of citizenship between [them].
The policies underlying diversity jurisdiction do not support such a
distinction between state and federal [litigants].”315
Guaranty Trust does not provide any good reason to allow federal courts
to maintain an independent body of law to govern equitable relief in both
federal and state cases.316 The Court declared that “[e]quitable relief in a federal
court . . . must be within the traditional scope of equity as historically evolved
in the English Court of Chancery”317 without explaining why those principles
apply in state-law cases. Despite Erie’s repudiation of general law, this
holding treats equity as a comparable “transcendental body of law outside of any
particular State” that binds federal courts in matters arising under state law.318
The Guaranty Trust Court further explained that, under section 16 of the
Judiciary Act, a federal court may not award equitable relief unless “a plain,
adequate and complete remedy at law [is] wanting.”319 Due to the merger of
law and equity, however, section 16 was omitted as obsolete from the modern
Judiciary Code when it was recodified three years after Guaranty Trust was
decided.320 Because section 16 was repealed, it no longer directly binds
One might respond by pointing out that section 16 “was but declaratory
of the rule in equity, established long before its adoption.”321 As discussed
above, however, the traditional rules of the English Court of Chancery cannot
apply of their own force in a post-Erie world. Of course, most states have
incorporated this “inadequate remedy at law” principle into their own equity
jurisprudence, so federal courts still must typically apply it in diversity cases
as a matter of state law.322 And even if the Court were to somehow interpret
Title 28 of the United States Code as a whole as implicitly retaining this
“inadequate remedy at law” principle, it would be simply one federal side
constraint that could be applied against the backdrop of state statutes and court
rulings concerning equitable remedies.
Guaranty Trust also noted that “explicit Congressional curtailment of
equity powers must be respected,” but such limitations are few and far
between.323 No federal statutes purport to either establish a code of federal
equitable remedies or prohibit federal courts from applying state law when
granting equitable relief.324 Guaranty Trust’s discussion concluded by reaffirming
that “the constitutional right to trial by jury cannot be evaded.”325 Because
juries typically play no role in equity, this restriction is unlikely to be
significant. Even in cases where a state has authorized equitable relief under
circumstances that would implicate the Seventh Amendment right to a jury in
federal court, however, a federal court could apply state standards while
allowing a jury to make any constitutionally required findings or judgments.
Wright and Miller’s Federal Practice treatise largely agrees with this
analysis as applied to permanent injunctions although, even in that context, it
contends that federal courts should reserve the power to ignore state equitable
principles “in exceptional cases in order to effect justice expeditiously or
creatively.”326 Of course, speed and judicial creativity play no role in Hanna’s
explanation of the Erie Doctrine. More significantly, the treatise contends that
federal courts sitting in diversity may apply uniform federal standards to
interim relief such as preliminary injunctions because they are not final
judgments for purposes of any outcome-determination test, but rather “procedures
for preserving the status quo pending a fair and complete adjudication of the
322 Conversely, when a federal court applies principles such as the “inadequate remedy at
law” rule in federal question cases, it does so as a matter of statutory interpretation or
constitutional common law. See infra notes 432–439 and accompanying text.
323 326 U.S. at 105 (citing Norris-LaGuardia Act, Pub. L. No. 72-65, 47 Stat. 70 (1932)
(codified at 29 U.S.C. §§ 101–115)).
324 Cf. Stewart Org., Inc., 487 U.S. at 32 (holding that the federal venue statute, 28 U.S.C.
§ 1404(a), applies in all cases in federal court); Prima Paint Corp. v. Flood & Conklin Mfg. Co.,
388 U.S. 395, 404–05 (1967) (holding that the Federal Arbitration Act applies in all cases in
325 Guaranty Trust Co., 326 U.S. at 105 (citing Whitehead v. Shattuck, 138 U.S. 146 (1891)).
326 19 WRIGHT ET AL., supra note 20, § 4513; see also id. § 2943.
327 Id. § 4513; Shipley, supra note 20, at 1218 (“[T]he final decision after a full trial on the
merits should not be substantially affected by going with the federal standard instead of a state’s
standard for provisional relief. A court’s ruling on a preliminary or interlocutory injunction is not
final.”). Wright and Miller also contend that Hanna requires courts to apply federal standards to
preliminary injunctions because Rule 65 discusses them. 19 WRIGHT ET AL., supra note 20,
This argument is unpersuasive in several respects. Most basically,
Wright and Miller’s analysis rests solely on Guaranty Trust’s outcome
determination test, ignoring the two-prong standard Hanna adopted in its place.328
As this subsection has demonstrated, the “twin aims of Erie”329 are best
served by compelling a federal court to apply the same body of equitable
remedial principles in diversity cases as a state court would, for both interim
and final relief. Moreover, it seems strange that a federal court would apply
different bodies of law at different stages of a case to determine a plaintiff’s
entitlement to an equitable remedy: federal law for interim relief, state law for
permanent relief. Such inconsistency could prevent a federal court from
enjoining irreparable injury that a plaintiff would ultimately be entitled to avoid.
Even considered on its own terms, however, Wright and Miller’s
argument is unconvincingly formalistic. An interim remedy changes at least one
of the litigants’ substantive rights—its power to perform certain primary
actions in the ordinary world outside of court—even if only temporarily. Such
an alteration in a party’s rights can properly be regarded as part of a case’s
outcome, regardless of its duration.
Furthermore, interim relief affects the outcome of the case by helping
preserve the possibility of a meaningful judgment on the merits. A
preliminary injunction can prevent irreparable harm that would otherwise moot a
case, precluding a judicial determination of the parties’ rights. Similarly, a
receiver can help preserve a defendant’s assets ensuring that they remain
available to satisfy a judgment. The outcome of a case thus can often depend
on the availability of interim remedies. State law should therefore govern
interim equitable relief as well as permanent relief.
Thus, Guaranty Trust retained the equitable remedial rights doctrine too
reflexively without fully considering Erie’s implications for it.330 The ruling
does not provide a valid basis for allowing federal courts to ignore state
statutes and precedents when granting equitable relief in state-law cases. Under
Hanna’s modified outcome-determination test, federal and state courts should
apply the state-law standards for awarding equitable relief in diversity cases
to prevent forum shopping and avoid inequitable administration of the laws.
§ 4513. The previous Section discussed the errors in that argument. See supra notes 269–274 and
328 Wright and Miller suggest that Guaranty Trust rather than Hanna is the proper standard
because Hanna did not “involve a question of remedies.” 19 WRIGHT ET AL., supra note 20,
§ 4513. Hanna appears fully applicable to remedial issues, however. See infra notes 342–347 and
329 Hanna, 380 U.S. at 467–68.
330 John C. McCoid, II, Hanna v. Plumer, The Erie Doctrine Changes Shape, 51 VA. L. REV.
884, 907 n.110 (1965) (arguing that Guaranty Trust “assumed . . . too easily, that variation in
remedy does not impinge on substantive law”).
The same reasoning mandating the extension of Erie to equity in general331
applies with equal force to equitable remedies.
2. Remedies as Substantive Law
More broadly, remedies should be deemed categorically substantive, not
procedural, for Erie purposes. Some scholars contend that remedies exist in
the hazy hinterlands between the much more familiar realms of “substantive”
and “procedural” rights.332 Whatever the merits of such arguments, remedies
should be deemed substantive under the Erie Doctrine.
Daryl Levinson cogently explains that rights are “inseparable from
remedies.”333 His theory of “remedial substantiation” teaches that “we should
look at rights and remedies as part of a single package,” because “the
practical value of a right is determined by its associated remedies.”334 The
substantive policies underlying rights created by state law can be frustrated by either
ineffective or overly strict remedies, as well as unduly restrictive or liberal
standards governing their availability.
Calabresi and Melamed’s seminal “cathedral” framework confirms the
integral relationship between rights and remedies.335 They explain that, for
each legal right or entitlement, a state must decide not only which competing
claimant should receive it, but also the manner in which it should be
protected.336 A right or entitlement may be protected by either a liability rule,
meaning ex post compensatory damages, or a property rule, such as an ex ante
injunction.337 The choice of liability rule or property rule protection for an
enti331 Guaranty Trust, 326 U.S. at 105, 108–09; Ruhlin v. N.Y. Life Ins. Co., 304 U.S. 202, 205
332 See supra note 6 and accompanying text.
333 Daryl J. Levinson, Rights Essentialism and Remedial Equilibration, 99 COLUM. L. REV.
857, 884 (1999).
334 Id. at 888, 904.
335 Guido Calabresi & A. Douglas Melamed, Property Rules, Liability Rules, and
Inalienability: One View of the Cathedral, 85 HARV. L. REV. 1089, 1110 (1972).
336 Id. at 1092 (“The state not only has to decide whom to entitle, but it must also
simultaneously make a series of equally difficult . . . decisions. . . . [concerning] the manner in which
entitlements are protected . . . .”).
337 In the cathedral framework:
A third party may violate an entitlement protected by a liability rule, without the
entitlement holder’s consent, so long as it pays the entitlement’s fair market value
(i.e., compensatory damages). The entitlement holder may not prevent third parties
from violating the entitlement, but rather may insist only on receiving an objectively
determined amount of compensation.
A property rule, in contrast, gives an entitlement holder the formal legal right to
prevent third parties from violating his entitlement ex ante. An entitlement protected
by a property rule cannot be transferred to a third party without the entitlement
tlement “is often made because it facilitates a combination of efficiency and
If a federal court grants property rule protection (by issuing an
injunction) for an entitlement that a state chose to protect solely by liability rules, it
may frustrate socially beneficial transactions. An entitlement protected by a
property rule may be transferred only with the voluntary consent of the
rightholder, but high transaction costs may frustrate or preclude such agreements,
even when they would lead to Pareto superior outcomes.339 Likewise, if a
state allows property rule protection for an entitlement, but a federal court
instead relegates a right-holder to liability rule protection (by refusing to issue
an injunction), right-holders may be deprived of the specific entitlements the
state sought to guarantee them and forced to accept cash equivalents
instead.340 A court’s choice of remedies thus directly implicates substantive
policy considerations to the same extent as the underlying cause of action.341
The Supreme Court has repeatedly recognized that remedies are
substantive in the Erie context.342 For example, in Browning-Ferris Industries v.
Kelco Disposal, the Court held, “In a diversity action, . . . the propriety of an
award of punitive damages for the conduct in question, and the factors the
jury may consider in determining their amount, are questions of state law.”343
Likewise, in Gasperini v. Center for Humanities, Inc., the Court held that a
state law requiring stricter appellate review of damages awards than federal
law permitted was substantive and therefore applicable in diversity cases.344
The Gasperini Court explained, “Erie precludes a recovery in federal court
Morley, supra note 310, at 2488 (citing Calabresi & Melamed, supra note 335, at 1092). I have
argued elsewhere that the traditional cathedral framework is incomplete, particularly for public
law cases. It should further distinguish between “potential property rules,” which protect
entitlements for which the right-holder has a substantial likelihood of being able to obtain injunctive
relief, and “complete property rules,” which protect entitlements that are currently protected by an
injunction. Id. at 2491–92.
338 Calabresi & Melamed, supra note 335, at 1110.
339 Id. at 1119. A “Pareto superior” transaction is one which “makes at least one person in the
world better off and no one worse off.” P. SAMUELSON & W. NORDHAUS, ECONOMICS 966 (13th
340 See Morley, supra note 310, at 2480.
341 See Crump, supra note 6, at 1272 (arguing that state policies governing equitable relief “are
just as important as those defining underlying rights” and deserve to be “properly vindicated”).
342 Shady Grove Orthopedic Assocs., P.A. v. Allstate Ins. Co., 559 U.S. 393, 407–08 (2010)
(recognizing that a rule is substantive for Erie purposes if it “alter[s] the rights themselves, the
available remedies, or the rules of decision by which the court adjudicate[s] either” (emphasis
343 492 U.S. 257, 278 (1989).
344 518 U.S. at 430–31.
significantly larger than the recovery that would have been tolerated in state
Outside the damages context, in Bernhardt v. Polygraphic Co. of Ameri
ca, the Court held that “the remedy by arbitration, whatever its merits or
shortcomings, substantially affects the cause of action created by the
State.”346 The arbitrability of a case to which the Federal Arbitrration Act did
not apply therefore was a substantive issue governed by state law, rather than
federal common law.347 As remedial issues are generally considered to be
substantive and governed by state law, there is no basis for treating equitable
The equivalence of the elements of a cause of action and the standards
governing remedies is confirmed in the surprisingly analogous context of
criminal law. In 2000, in Apprendi v. New Jersey, the Supreme Court held that
a prosecutor must prove to a jury beyond a reasonable doubt any fact that
could lead to an increase in the maximum sentence a defendant may
receive.348 The State of New Jersey had argued that, although the Constitution
required the prosecution to prove elements of a criminal offense to the jury
beyond a reasonable doubt, sentencing factors that merely increased a
defendant’s sentence could be proved to the trial judge by a preponderance of
the evidence.349 In effect, the state tried to argue that a constitutionally
relevant distinction existed between the elements of a crime and the facts
necessary to impose sentencing enhancements.
The Apprendi Court flatly refused to distinguish between “an ‘element’
of a felony offense and a ‘sentencing factor.’”350 Sentencing factors, like the
elements of an offense, are simply “circumstances of [a] crime” that lead to a
particular punishment.351 The Court emphasized that “the relevant inquiry is
one not of form, but of effect—does the required finding expose the
defendant to a greater punishment than that authorized by the jury’s guilty
verdict?”352 The elements of a crime are analogous to the elements of a civil
cause of action, and sentencing factors are comparable to the elements that
must be proven to obtain a particular civil remedy, whether legal or equitable.
345 Id. at 431; see also Alyeska Pipeline Serv. Co. v. Wilderness Soc’y, 421 U.S. 240, 260
n.31 (1975) (holding that a litigant’s entitlement to recover attorneys’ fees is substantive).
346 350 U.S. 198, 203 (1956) (emphasis added).
348 530 U.S. 466, 490 (2000) (“Other than the fact of a prior conviction, any fact that
increases the penalty for a crime beyond the prescribed statutory maximum must be submitted to a jury,
and proved beyond a reasonable doubt.”).
349 Id. at 469.
350 Id. at 478.
351 Id. at 480.
352 Id. at 494.
Apprendi recognized that elements of an offense and sentencing factors are
functionally interchangeable—both must be proven for a defendant to receive
a particular sentence. So, too, the elements of a civil cause of action and the
requirements for obtaining a particular remedy are likewise interchangeable.
Both are simply facts a plaintiff must prove to be eligible to receive a
particular form of relief. Apprendi thus confirms the substantive nature of remedies.
In short, the Rules of Decision Act requires federal courts to apply state
law when determining the availability of relief, including equitable relief, in
cases arising under state law. The equitable remedial rights doctrine cannot
survive Erie; Guaranty Trust is an anachronism without a statutory basis.
C. Equity and the Constitution
The Rules of Decision Act, properly interpreted, requires federal courts
to apply a state’s statutes and precedents concerning all equitable issues,
including remedial issues, in diversity and supplemental jurisdiction cases.353
Because Guaranty Trust is a long-established precedent, the Supreme Court
may be reluctant to overturn it based solely on doubts about its reasoning.354
Like the Supreme Court’s Swift v. Tyson decision in 1842,355 however,
Guaranty Trust’s misinterpretation of the Rules of Decision Act raises
constitutional problems, as well. Subsection 1 below explains how the equitable
remedial rights doctrine violates principles of federalism.356 Subsection 2
considers the separation-of-powers problems it creates.357 Subsection 3 concludes
by distinguishing equity from other bodies of federal common law that
federal courts have constitutional authority to develop.358
The equitable remedial rights doctrine violates federalism-based
restrictions on federal courts. The Constitution allows Congress to exercise only
limited, enumerated powers, protecting the states’ prerogative to exclusively
govern other remaining fields, which the Framers did not deem to be of
national concern.359 Congress may not enact, or authorize federal courts to craft,
either federal law, or general law governing only diversity cases, concerning
353 Supra notes 295–352 and accompanying text.
354 Cf. Erie, 304 U.S. at 77 (“If only a question of statutory construction were involved, we
should not be prepared to abandon a doctrine so widely applied throughout nearly a century.”).
355 41 U.S. (16 Pet.) 1 (1842).
356 See infra notes 359–376 and accompanying text.
357 See infra notes 377–398 and accompanying text.
358 See infra notes 399–409 and accompanying text.
359 Bond v. United States, 134 S. Ct. 2077, 2086 (2014); cf. U.S. CONST. amend. X.
areas outside the scope of its enumerated powers.360 For the same
federalismrelated reasons, federal courts may not claim power (as they did in Swift) to
develop substantive rules of decision concerning matters outside the scope of
Congress’ legislative authority.361 The establishment and application of
general law in diversity cases “invaded rights . . . reserved by the Constitution to
the several states.”362
These federalism-related limits preclude both Congress and the federal
judiciary from establishing a uniform body of federal equitable principles
governing remedies in diversity cases. Several provisions in Article I of the
Constitution empower Congress to dictate remedies specifically for certain
types of cases, such as disputes affecting interstate commerce363 or patents.364
Congress lacks broader authority, however, to establish a general law of
equitable remedies that federal courts must apply in all equity cases.365 Under
Erie, it would therefore violate federalism-based limits on the national
government’s authority for a federal court to do so, either.366
360 Erie, 304 U.S. at 78 (“[Congress] has no power to declare substantive rules of common
law applicable in a state whether they be local in their nature or ‘general’ . . . .”). Dean Ely,
adopting this federalism-based interpretation of Erie, explained that Swift v. Tyson’s recognition of
federal courts’ power to craft general law was “unconstitutional because nothing in the
Constitution provide[s] the central government with a general lawmaking authority of the sort the Court
had been exercising . . . .” Ely, supra note 295, at 703.
361 See Henry J. Friendly, In Praise of Erie—and of the New Federal Common Law, 39
N.Y.U. L. REV. 383, 395 (1964) (“[I]t would be even more unreasonable to suppose that the
federal courts have a law-making power which the federal legislature does not. . . . The spectacle of
federal judges being able to make law without possibility of Congressional correction would not
be a happy one.”).
362 Erie, 304 U.S. at 80. Scholars have pointed out that, in light of sweepingly broad modern
interpretations of Congress’ powers, these federalism-based restrictions are fairly minimal. See
Craig Green, Repressing Erie’s Myth, 96 CALIF. L. REV. 595, 612 (2008) (“The problem with
Erie’s enumerated-powers argument is that any ‘gap’ between Article III diversity jurisdiction and
Article I legislative power is too small to explain Erie, much less justify the wholesale reversal of
Swift-era common law.”).
363 U.S. CONST. art. I, § 8, cl. 3 (Commerce Clause); see, e.g., Nat’l Fed’n Indep. Bus. v.
Sebelius, 567 U.S. 519, 549 (2012).
364 U.S. CONST. art. I, § 8, cl. 8 (Patent Clause); see, e.g., 35 U.S.C. §§ 283–284 (2012).
365 Cross, supra note 20, at 201 (“None of Congress’s enumerated powers . . . are broad
enough to cover the entire set of substantive rules that comprise the law of equity. Congress
certainly has no power to regulate what remedies are available in cases arising under state law, even
when those remedies are [sic] heard in federal court.”). Congress likely could strip federal courts
of their jurisdiction to grant particular remedies, however, including in diversity cases. Cf. U.S.
CONST. art. I, § 8, cl. 9 (granting Congress power to “constitute tribunals inferior to the Supreme
Court”); id. art. III, § 2, cl. 2 (providing that the Supreme Court’s appellate jurisdiction is subject
to “such exceptions . . . as the Congress shall make”).
366 Cf. Plank, supra note 20, at 670 (“[F]ederal courts in bankruptcy may not use their equity
power to go beyond Congress’s power under the Constitution. To the extent that equity plays a
role in bankruptcy, that role must be confined to the limits of bankruptcy law.”).
Some scholars reject this federalism-based interpretation of Erie,
arguing that the Constitution’s Diversity Jurisdiction Clause,367 read in
conjunction with the Necessary and Proper Clause,368 permits Congress to either craft
substantive rules of decision for diversity cases or authorize federal courts to
do so.369 Such arguments are unpersuasive. Although Congress’ power to
establish courts implicitly carries with it the prerogative to enact or authorize
the creation of procedural rules to govern them,370 it cannot reasonably be
read as allowing Congress to establish rules of decision—substantive law—
for those courts to apply.371 If the power to create courts implicitly carried
with it the power to enact substantive law for them to apply, then Article I’s
grants of lawmaking power over certain specified substantive areas would be
largely unnecessary. Moreover, the notions of limited government and
enumerated powers upon which Article I is based372 would be undermined, at
least within federal courts.373
367 U.S. CONST. art. III, § 2, cl. 7 (“The judicial power shall extend . . . to
controversies . . . between citizens of different states.”).
368 Id. art. I, § 8, cl. 18 (“Congress shall have power . . . [t]o make all laws which shall be
necessary and proper for carrying into execution . . . all other powers vested by this Constitution in
the government of the United States, or in any department or officer thereof.”).
369 Lawrence Earl Broh-Kahn, Amendment by Decision—More on the Erie Case, 30 KY. L.J.
3 (1941) (arguing that Article III’s jurisdictional grants permit federal courts to engage in
substantive lawmaking); McCormick & Hewes, supra note 113, at 135 (“[T]he Judiciary article and the
‘necessary and proper’ clause could well be interpreted to confer” upon Congress power to “lay
down rules of substantive law for controversies between citizens of different states.” (parentheses
omitted)); see also Note, Congress, the Tompkins Case, and the Conflict of Laws, 52 HARV. L.
REV. 1002, 1003–04 (1939) (“[T]he Judiciary Article and the ‘necessary and proper’ clause of
Article One may fully authorize Congressional legislation prescribing the substantive law to be
applied in the federal courts.”).
370 Hanna, 380 U.S. at 472 (“[T]he constitutional provision for a federal court system
(augmented by the Necessary and Proper Clause) carries with it congressional power to make rules
governing the practice and pleading in those courts . . . .”).
371 Id. at 471–72 (“[N]either Congress nor the federal courts can, under the guise of
formulating rules of decision for federal courts, fashion rules which are not supported by a grant of federal
authority contained in Article I or some other section of the Constitution.”); Ely, supra note 295,
at 703–04 (“The Constitution’s reference to a diversity of citizenship jurisdiction had been
intended as that and no more—a grant of power to provide courts for diversity cases and to prescribe the
rules of practice and procedure by which they would manage their business, but not to go on and
provide them . . . with rules that could not fairly be characterized as procedural.”); see also Plank,
supra note 20, at 637 (“If Congress does not have the power under Article I of the Constitution to
prescribe a rule to be applied in a particular controversy, then federal judges . . . must apply state
law.”); cf. infra notes 387–393 and accompanying text (arguing that broad jurisdictional grants to
courts do not inherently confer authority to craft substantive rules of decision).
372 See U.S. CONST. art. I, § 1 (specifying that Congress may exercise only the legislative
powers “herein granted”); see also supra note 359 and accompanying text.
373 Cross, supra note 20, at 205; Friendly, supra note 361, at 396 (“[I]t would subvert the
scheme of the Constitution . . . to read this auxiliary clause as a catch-all empowering Congress to
enact a code of private law applicable to all relations between citizens, subject to the sole
qualification” that one party can invoke federal jurisdiction.).
Judge Henry Friendly opined in his seminal article on Erie that “so
important an assignment of legislative power could not fairly be hung on so
inconspicuous a peg.”374 He added that “[e]stablishing a body of substantive
law for federal courts in matters not otherwise of federal concern is not a
legitimate end within the scope of the Constitution”375 for purposes of
McCulloch v. Maryland.376 Thus, under a federalism-based interpretation of Erie,
because Congress lacks power to impose substantive standards governing
equitable relief in diversity cases, federal courts may not do so, either.
2. Separation of Powers
Even if establishing a generally applicable body of equitable remedial
principles for federal courts were within the federal government’s power, it
would violate separation-of-powers restrictions for federal courts to assume
such authority for themselves without statutory authorization. Under a
separation-of-powers interpretation of Erie, federal courts may not establish general
law or federal common law—including equitable remedial principles to apply
in diversity cases—without some constitutional or statutory delegation of
authority to do so.377
Congress has not enacted any laws granting federal courts general
authority to establish equitable principles applicable to all cases (including
diversity cases) that come before them.378 When a particular federal statute
allows courts to enjoin violations of its substantive provisions, a court may
presume that Congress implicitly intended to incorporate traditional equitable
standards.379 But no comparable basis exists for applying such federal
equitable standards in diversity cases that arise under state law. Federal courts
sit374 Friendly, supra note 361, at 394.
375 Id. at 397.
376 McCulloch v. Maryland, 17 U.S. (4 Wheat.) 316 (1819). McCulloch famously interpreted
the Necessary and Proper Clause by declaring, “Let the end be legitimate, let it be within the
scope of the constitution, and all means which are appropriate, which are plainly adapted to that
end, which are not prohibited, but consist with the letter and spirit of the constitution, are
constitutional.” Id. at 421.
377 Clark, supra note 196, at 1290, 1302 (arguing that federal courts may not ignore state law
unless authorized to do so by a source of law listed in the Supremacy Clause); Paul J. Mishkin,
Some Further Last Words on Erie—The Thread, 87 HARV. L. REV. 1682, 1683 (1974) (“[That]
Congress may have constitutional power to make federal law displacing state substantive policy
does not imply an equal range of power for federal judges. Principles related to the separation of
powers impose an additional limit on the authority of federal courts to engage in lawmaking on
their own.” (emphasis omitted)); see also Plank, supra note 20, at 649; Congress, the Tompkins
Case, and the Conflict of Laws, supra note 369, at 1004.
378 Cf. Textile Workers Union v. Lincoln Mills, 353 U.S. 448 (1957)
(holding that the Labor
Management Relations Act of 1947 authorizes federal courts to create a body of federal common
law to govern collective bargaining agreements)
379 See infra notes 432–436 and accompanying text.
ting in diversity should therefore apply the equitable principles, including
equitable remedial principles, of the state whose law gave rise to the
Some critics maintain that Article III’s grant of diversity jurisdiction
empowers federal courts to craft substantive rules of decision to govern
diversity cases.381 They point out that other jurisdictional grants, such as those
concerning admiralty382 and controversies between states,383 allow federal
courts to develop substantive law to apply in such cases.384 Those other
jurisdictional provisions, however, are fundamentally different from
constitutional385 and statutory386 grants of diversity jurisdiction in a variety of respects.
The Constitution empowers Congress to enact statutes governing
admiralty and most interstate disputes that are equally binding on federal and state
courts, so no federalism concerns arise from federal courts crafting such rules
as a matter of federal common law. Congress lacks comparable authority to
adopt a body of rules for resolving disputes between citizens of different
states,387 so federalism considerations counsel against allowing federal courts
to do so.388 Moreover, admiralty cases and disputes between states involve
narrow, specialized areas of the law that affect relatively few litigants.389 A
court’s diversity jurisdiction, in contrast, “cover[s] almost the whole range of
ordinary legal disputes.”390 The power to make substantive rules of decision
for diversity cases would constitute virtually plenary power to regulate nearly
all aspects of life, including torts, contracts, property, and other foundational
fields of law. Neither the history nor structure of the Constitution suggests
federal courts possess such authority, especially in equity, which many
Framers particularly distrusted.391
Finally, the Supreme Court has become much more precise about
distinguishing jurisdiction from other types of issues than it was in decades past.392
This new line of authority provides further reason for distinguishing a
jurisdictional grant from the power to create substantive rules of decision.393 Thus,
the fact that certain provisions in Article III, such as the Admiralty Clause, are
interpreted as authorizing federal courts to craft rules of decision does not
suggest the Diversity Jurisdiction Clause should be construed the same way.
Federal courts sitting in diversity should defer to state law for any remedial or
equitable matters for which Congress has not provided statutory standards.
Professor John T. Cross contends that federal courts may develop and
apply independent federal equitable principles in diversity cases on somewhat
different grounds. Although he recognizes that the Diversity Jurisdiction
Clause does not itself authorize federal courts to craft such principles,394
Professor Cross nevertheless contends that they have inherent power to do so. He
argues that Article III requires federal courts to adjudicate rights in “roughly
the same” way as English courts traditionally did, and the English Court of
Chancery possessed “the ability to exercise discretion in determining whether
and how to enforce a legal right.”395 Erie, he maintains, does not limit this
“traditional power to exercise discretion in matters involving whether and
how a substantive right should be enforced.”396 Federal courts should
there390 McCormick & Hewins, supra note 113, at 142.
391 See supra notes 89, 92–93 and accompanying text.
392 See, e.g., Dolan v. United States, 560 U.S. 605, 610 (2010) (distinguishing jurisdictional
issues from “claims processing rules”); Kontrick v. Ryan, 540 U.S. 443, 454–55 (2004)
(reiterating that courts and litigants should not use the term “jurisdictional” for “claim-processing rules,
but only for prescriptions delineating the classes of cases (subject-matter jurisdiction) and the
persons (personal jurisdiction) falling within a court’s adjudicatory authority”); Steel Co. v.
Citizens for a Better Env’t, 523 U.S. 83, 91 (1998) (distinguishing merits-related issues from
393 See also Adam N. Steinman, What Is the Erie Doctrine? (And What Does It Mean for the
Contemporary Politics of Judicial Federalism?), 84 NOTRE DAME L. REV. 245, 250 (2008)
(“Erie . . . rejected the idea that the mere existence of jurisdiction carries with it the power to
dictate substantive legal standards.”).
394 Cross, supra note 20, at 201, 205.
395 Id. at 207, 209.
396 Id. at 213.
fore apply “uniform national rules that originated in England,” rather than
state law, when granting equitable relief.397
Cross offers the most thorough modern defense of the equitable
remedial rights doctrine. Although consistent with Guaranty Trust, his argument
does not support such an exception to the modern Erie framework. The
Constitution grants federal courts power to adjudicate various types of disputes,
including diversity cases, in both law and equity.398 Modern courts and
commentators generally agree that Article III’s grant of jurisdiction over
commonlaw disputes neither permits federal courts to apply their own conception of
common-law principles (i.e., general law) in diversity cases, nor requires
them to adhere to the English common-law courts’ conception of the common
law as it existed back in 1789.
The same is true of equity. The fact that the Constitution allows federal
courts to adjudicate cases in equity neither inherently ties them to a particular
body of equitable principles from over two centuries ago, nor requires them
to ignore state equity laws and precedents in cases arising under state law. As
discussed in the next Section, equity is not a single, uniform, freestanding
body of principles that federal courts are required to apply to all cases that
come before them. Rather, through statutes and judicial opinions, each state
has developed its own, somewhat different body of equitable principles, often
reflecting substantive policy determinations. Under Erie and Hanna, federal
courts lack inherent power to set aside those policies in diversity cases. Thus,
because Congress has neither displaced states’ respective equity systems nor
authorized federal courts to do so—either in general or specifically with
regard to remedies—separation-of-powers concerns counsel strongly against
federal courts claiming such authority for themselves.
3. Equity and Federal Common Law
A final important consideration is that equity differs materially from the
bodies of federal common law that the Erie Doctrine allows federal courts to
create. Erie’s blanket declaration that “[t]here is no federal general common
law” is admittedly overbroad.399 Even after Erie, the Supreme Court has held
that federal courts may craft federal common law to cover “cases raising
issues of uniquely federal concern.”400 The Court has approved the adoption of
397 Id. at 214.
398 U.S. CONST. art. III, § 2, cl. 1.
399 Erie, 304 U.S. at 78.
400 Nw. Airlines, Inc. v. Transp. Workers Union, 451 U.S. 77, 95 (1981); see also Wallis, 384
U.S. at 66–67, 72 (holding that state law, rather than federal common law, governed a dispute
among private parties concerning an oil and gas lease of federal land because, “[i]n deciding
whether rules of federal common law should be fashioned, normally the guiding principle is that a
federal common law for cases concerning “the rights and obligations of the
United States, interstate and international disputes implicating the conflicting
rights of States or our relations with foreign nations, and admiralty cases.”401
In state-law cases, neither equity in general, nor equitable remedial rights in
particular, comes close to meeting this standard.402
Cases arising under state law that do not involve the federal government
or federal officials as parties do not categorically implicate important federal
interests.403 The federal government is generally unaffected by whether
statecreated rights are protected by liability rules or property rules. Particularly
because the law of each state differs, the government likewise lacks a strong
interest in applying a uniform body of principles to govern remedies,
including equitable remedies, in cases arising under state law throughout the nation.
Unlike many other fields governed by federal common law, such as federal
negotiable instruments,404 federal contracts,405 federal loan programs,406 and
liability for harming members of the Armed Forces,407 the availability of
equitable remedies in diversity and supplemental jurisdiction cases does not
affect the government’s powers, rights, or liabilities. And unlike the federal
common law governing disputes between states408 or certain transnational
disputes,409 equity is not an area of peculiar national concern that is
constitutionally committed to the national government.
Thus, there is no need for national uniformity and no federal interest to
vindicate with respect to equitable remedies in cases arising under state law.
significant conflict between some federal policy or interest and the use of state law in the premises
must first be specifically shown”).
401 Texas Indus., Inc. v. Radcliff Materials, Inc., 451 U.S. 630, 641 (1981) (footnotes
Equitable remedies in ordinary tort, property, and contract cases do not
become appropriate subjects of federal common law simply because disputes
arise between citizens of different states.
D. A New Conception of Equity: Equity Follows the Law
Federal courts should fundamentally reconceptualize their approach to
the federal equity power. They should abandon their traditional understanding
of equity as a freestanding body of principles derived from the English Court
of Chancery that governs remedies either of its own force, or as a result of
some grant of jurisdiction within Article III, in all cases that come before
them.410 Instead, modern equity is best conceptualized as an analogue to the
common law and should be treated as such for Erie purposes, to the extent
The body of equitable principles, including remedial principles, that
governs a claim is a function of the law that gave rise to that claim. When a
claim arises under a state statute or state common law,412 that state’s body of
remedial law—including its equitable principles—should determine the
available remedies. The court should treat the requirements for equitable
relief the same as it does the elements of the underlying cause of action. There
is no freestanding body of general or federal equitable principles with the
force of law that a court is required to apply.413
Such a repudiation of Guaranty Trust and the equitable remedial rights
doctrine would have the most dramatic consequences for injunctive relief for
state-law claims in federal court. As discussed earlier, the Supreme Court
applies a four-factor test set forth in eBay Inc. v. MercExchange L.L.C. to
determine whether to grant permanent injunctions and a similar test from Winter
410 See supra notes 165–181 and accompanying text.
411 The Seventh Amendment right to civil jury trials is the most prominent example of a
constitutional provision that sometimes requires federal courts to distinguish between legal and
equitable claims. See U.S. CONST. amend. VII.
412 The same principle holds true for state constitutional provisions, but the Eleventh
Amendment will seldom permit federal courts to enforce them. See Pennhurst State Sch. & Hosp.
v. Halderman, 465 U.S. 89, 117 (1984) (“[A] federal suit against state officials on the basis of
state law contravenes the Eleventh Amendment when—as here—the relief sought and ordered has
an impact directly on the State itself.”).
413 As discussed in the previous Sections, there is no valid alternative to this approach. The
Federal Rules of Civil Procedure do not provide substantive standards to govern equitable relief.
See supra notes 241–294 and accompanying text. The Rules of Decision Act directs courts to
apply state statutes and judicial rulings for claims arising under state law, and no other federal law
authorizes federal courts to apply their own equitable remedial standards instead. See supra notes
295–352 and accompanying text. Federal courts lack constitutional authority to impose a uniform
set of equitable principles in diversity cases, see supra notes 359–398 and accompanying text, and
no important national interest exists warranting creation of federal common law to govern the
issue, see supra notes 399–409 and accompanying text.
v. Natural Resources Defense Council for preliminary injunctions.414 Some
states have rejected the eBay415 and Winter standards.416 Others have laws
expressly mandating the award of injunctive relief in situations where federal
equitable principles would dictate that courts exercise discretion under
eBay.417 Several state statutes permit or require injunctive relief even when
one or more of the traditional equitable requirements identified in eBay have
not been satisfied.418
California law identifies seven types of cases in which injunctions may
be issued, and seven types of injunctions courts may not grant.419 For
example, California law allows injunctive relief whenever an obligation arises
from a trust.420 New York421 and Texas422 also have statutes codifying
standards for injunctive relief that differ from the federal tests.
Other states have adopted their own sets of standards, either in general
or for particular types of cases,423 in judicial opinions. In Alaska, for example,
a plaintiff is required to make only “a clear showing of probable success” to
obtain a preliminary objection.424 Arkansas relies only on two elements:
“whether irreparable harm will result in the absence of an injunction . . . [and]
whether the moving party has demonstrated a likelihood of success on the
merits.”425 The Massachusetts Supreme Judicial Court has held that a person
suing as a “private attorney general” may obtain a preliminary injunction by
demonstrating only a likelihood of success on the merits and that the
requested relief would be in the public interest.426
Even where states have adopted standards comparable to eBay or
Winter, the exact formulations of their elements often differ. For example, some
states require a plaintiff to show a “reasonable likelihood of success on the
merits.”427 Other states require a “strong likelihood of success on the
merits,”428 and still others allow relief even if the plaintiff shows only “some
possibility that the plaintiff would ultimately prevail on the merits of the
claim.”429 Likewise, some states require a plaintiff to show that the hardship
an injunction would cause to the defendant does not outweigh the benefit the
plaintiff would obtain from an injunction,430 while others require the plaintiff
to show “the balance of hardships” favors it.431 Thus, a federal court’s
decision to apply state law to equitable relief can have a substantial impact on
whether a plaintiff is able to obtain a preliminary or permanent injunction.
In contrast, for claims arising under federal statutes, the standards
governing equitable relief are a matter of statutory interpretation.432 If a law does
not provide a remedy for violations, federal courts may assume that Congress
implicitly authorized them to award any appropriate remedy, including
equitable relief pursuant to traditional principles.433 When a statute provides for
an injunction as a remedy, a court may likewise presume that Congress
implicitly intended to incorporate traditional equitable principles as set forth in
eBay and Winter.434
Congress may authorize or require courts to instead apply different
factors, or even grant injunctive relief automatically, through express language in
425 Baptist Health v. Murphy, 226 S.W.3d 800, 806 (Ark. 2006).
426 LeClair v. Town of Norwell, 719 N.E.2d 464, 468 (Mass. 1999).
427 TFT, Inc. v. Warning Sys., Inc., 751 So. 2d 1238, 1242 (Ala. 1999), overruled on other
grounds, Holiday Isle, LLC v. Adkins, 12 So. 3d 1173 (Ala. 2008).
428 TP Racing, L.L.L.P. v. Simms, 307 P.3d 56, 62 (Ariz. Ct. App. 2013).
429 Butt v. State, 842 P.2d 1240, 1246 (Cal. 1992).
430 TFT, Inc., 751 So. 2d at 1242.
431 TP Racing, 307 P.3d at 62.
432 Morley, supra note 267, at 182–94.
433 See Rondeau v. Mosinee Paper Corp., 422 U.S. 49, 63 (1975) (holding that, to obtain an
injunction in an implied right of action, a plaintiff must “establish the traditional prerequisites of
relief”); see also Bell v. Hood, 327 U.S. 678, 684 (1946) (“[W]here legal rights have been
invaded, and a federal statute provides for a general right to sue for such invasion, federal courts may
use any available remedy to make good the wrong done.”).
434 eBay, 547 U.S. at 391–92 (holding that the eBay factors apply where “Congress intended”
they do so); see also Holmberg v. Armbrecht, 327 U.S. 392, 395 (1946); Morley, supra note 267,
at 183 n.28.
a statute’s text or legislative history.435 Under this “clear-statement” rule, a
court must issue an injunction, rather than balancing equities in accordance
with traditional principles, when a statute clearly mandates it.436 In the
absence of such clear language, the statute itself—not Article III, the Federal
Rules of Civil Procedure, or some independent body of principles with the
force of law—implicitly requires the court to apply traditional equitable
principles in deciding whether to grant relief.
The same principle applies to federal constitutional violations. The
Supreme Court has repeatedly recognized that Congress generally has ultimate
control over the nature and scope of constitutional remedies.437 When
Congress has not provided a remedy for a constitutional violation, a federal court
is free to apply traditional equitable principles as a matter of constitutional
common law.438 Congress retains authority to displace those traditional
standards, however, by either broadening or restricting the circumstances under
which equitable relief is available.439
When a plaintiff presents multiple claims in a diversity or supplemental
jurisdiction case, a federal court should apply traditional equitable principles
when considering relief for the federal causes of action (or whatever
alternative standards Congress established within each federal statute at issue), and
apply that state’s body of equitable principles for the state-law claims.
Depending on state law, a plaintiff may be able to obtain an injunction for her
435 Amoco, 480 U.S. at 544 (holding that a federal court may issue a statutory injunction only
when it is warranted under the traditional requirements for injunctive relief, unless there exists a
“clear indication . . . that Congress intended to deny federal district courts their traditional
equitable discretion”); Weinberger v. Romero-Barcelo, 456 U.S. 305, 320 (1982) (holding that “a major
departure from the long tradition of equity practice should not be lightly implied”); see also Hecht
Co. v. Bowles, 321 U.S. 321, 330 (1944).
436 Tenn. Valley Auth. v. Hill, 437 U.S. 153, 194–95 (1978) (holding that injunctive relief
was mandatory as a remedy for violations of the Endangered Species Act because allowing courts
to “strike a balance of equities” to decide whether issuing an injunction furthers “the public weal”
would “pre-empt” Congress’ statutory scheme); United States v. City of S.F., 310 U.S. 16, 30–31
(1940) (holding that the federal Raker Act “does not call for a balancing of equities or for the
invocation of the generalities of judicial maxims in order to determine whether an injunction
should have issued”).
437 See Corr. Servs. Corp. v. Malesko, 534 U.S. 61, 69 (2001) (“So long as the plaintiff had an
avenue for some redress, bedrock principles of separation of powers foreclose judicial
imposition of a new substantive liability” for constitutional violations.); see also Daniel J. Meltzer,
Congress, Courts, and Constitutional Remedies, 86 GEO. L.J. 2537, 2559 (1998) (arguing that
Congress may limit remedies for constitutional violations, but must ensure the remedial structure it
creates is “adequate to keep government generally within the bounds of law” (citing Richard H.
Fallon, Jr. & Daniel J. Meltzer, New Law, Non-Retroactivity, and Constitutional Remedies, 104
HARV. L. REV. 1731, 1778–79 (1991))).
438 See Henry P. Monaghan, Foreword: Constitutional Common Law, 89 HARV. L. REV. 1
439 See, e.g., Prison Litigation Reform Act of 1995, Pub. L. No. 104–134, 110 Stat. 1321
(1996) (imposing stricter standards for the issuance of injunctions concerning prison conditions).
federal claims, but not her state ones, or vice versa. To ascertain a state’s body
of equitable principles, a federal court should approach the issue in the same
way it attempts to resolve any other question of state law under Erie.440 By
relying on state law to address equitable remedial issues in diversity and
supplemental jurisdiction cases, the federal judiciary can inter the remaining
lingering remnants of general law’s brooding omnipresence.441
From the nation’s founding, the Supreme Court treated equity as a
parallel body of general law to be applied in all cases that federal courts
adjudicate. Erie laid to rest the vast majority of general law, but Guaranty Trust
inexplicably exempted a substantial part of federal equity law from the Erie
Doctrine. The time has come to complete the task that Erie started nearly a
century ago and banish the lingering remnants of the old federal equity
The principles adopted by the English Court of Chancery are not
binding on the federal judiciary, either of their own force or pursuant to Article III.
And neither the Constitution, any federal statute (including the Rules of
Decision Act), nor the Federal Rules of Civil Procedure requires or empowers
federal courts to apply their own body of equitable principles in determining the
proper relief in diversity and supplemental jurisdiction cases before them.
Equity follows, and arises from, the law. When a federal court
adjudicates a state-law claim, the statutes and judicial precedents of that state should
govern the availability of equitable relief. Conversely, when a federal court
adjudicates a federal statutory claim that provides for equitable relief, it may
presume that Congress implicitly intended to incorporate traditional equitable
principles into the statute, unless its text or legislative history expressly
provides otherwise. When adjudicating a federal constitutional claim, a federal
court may apply traditional equitable principles as a matter of constitutional
common law, unless Congress has provided otherwise.
Rights and remedies are inextricably intertwined, and the remedies a
state chooses to recognize (or prohibit) for particular entitlements reflect that
state’s important policy decisions. A federal court may no more ignore a
state’s remedial requirements and restrictions than it may the state’s
underlying causes of action. Neither a litigant’s ability to obtain relief, nor the nature
440 See Corbin, supra note 228, at 771 (concluding that, when a federal court must apply state
law, it should employ the same range of “sources and processes” that a state trial court would use);
Hart, supra note 20, at 510 (arguing that a federal court should “have the freedom at least of the
state courts immediately inferior to the state’s highest court” to determine a state’s law on an
441 See supra note 227.
of relief a litigant may receive, should depend on whether the case is
adjudicated in federal or state court.
III. EQUITY IN THE POST-ERIE WORLD ......................................................................................... 244
1. Equity , Hanna, and the Twin Aims of Erie ..................................................................... 259
2. Remedies as Substantive Law......................................................................................... 264
D. A New Conception of Equity: Equity Follows the Law......................................................... 275 1 This article's analysis applies to any claim in federal court arising under state law . Although
court's supplemental jurisdiction . Felder v. Casey , 487 U.S. 131 , 151 ( 1988 ). 2 547 U .S. 388 , 391 , 394 ( 2006 ); see infra notes 265-266 and accompanying text. 3 See infra notes 415-431 and accompanying text . 4 304 U.S. 64 , 78 ( 1938 ). 5 Hanna v . Plummer , 380 U.S. 460 , 464 - 65 ( 1965 ); Erie, 304 U.S. at 78. 6 See, e.g., DAN B . DOBBS, LAW OF REMEDIES: DAMAGES-EQUITY-RESTITUTION § 1.1 , at
2 (2d ed. 1993 ) ; David Crump, The Twilight Zone of the Erie Doctrine: Is There Really a Different
Choice of Equitable Remedies in the “Court a Block Away”?, 1991 WIS. L. REV . 1233 , 1235
MODERN AMERICAN REMEDIES 1 (4th ed. 2010 ) (“The law of remedies falls somewhere in be-
from the rest of the substantive law, and sometimes their details blur into procedure . ”) . 7 See, e.g., Shady Grove Orthopedic Assocs ., P.A. v. Allstate Ins . Co., 559 U.S. 393 , 401 - 02
( 2010 ) (holding that a federal court sitting in diversity may not apply a state law prohibiting class
actions for statutory penalties on the grounds the issue is procedural). 31 THEODORE F.T. PLUCKNETT, A CONCISE HISTORY OF THE COMMON LAW 681 (5th ed.
1956 ). 32 GEO. TUCKER BISPHAM , THE PRINCIPLES OF EQUITY 3 -4 (5th ed. 1893 ) ; JOHN H. LANG-
INSTITUTIONS 18- 19 ( 2009 ). 33 BISPHAM, supra note 32, at 11 . 34 D. KERLY , A HISTORICAL SKETCH OF THE EQUITABLE JURISDICTION OF THE COURT OF
CHANCERY 13 ( 1890 ). 35 See LANGBEIN , supra note 32, at 90-91; see also Statute of Westminster I, 3 Edw. 1, ch . 17
(1275) (declaring that “the King, which is Sovereign Lord over all, shall do Right there unto such
as will complain”) . 36 MELVILLE M. BIGELOW , HISTORY OF PROCEDURE IN ENGLAND 151-52 ( 1880 ). 37 LANGBEIN, supra note 32, at 118-22; PLUCKNETT, supra note 31, at 147-51; Harold D.
Hazeltine , The Early History of English Equity , in ESSAYS IN LEGAL HISTORY 261 , 262 (P.
Vinogradoff ed. 1913 ). 38 George B. Adams , The Origin of English Equity , 16 COLUM. L. REV. 87 , 89 ( 1916 ) ; see
also Hazeltine, supra note 37 , at 262 . 39 David W. Raack , A History of Injunctions in England Before 1700 , 61 IND. L.J. 539 , 545 -
50 ( 1986 ). 78 Id.; see also MAITLAND, supra note 56 , at 312; Dennis R. Klinck , Lord Nottingham's
“Certain Measures,” 28 L. & HIST. REV . 711 , 746 ( 2010 ) (discussing Nottingham's efforts). 79 5 HOLDSWORTH , supra note 41, at 547 . 80 3 BLACKSTONE, supra note 48, at *432. He elsewhere explained that “[i]f the rigor of gen-
defects, but not sap the fundamentals, of the law . ” Id. at *60. 81 HOFFER, supra note 46, at 49-51. 82 See THE FEDERALIST NO. 83 , at 435 ( Alexander Hamilton) (George W. Carey & James
McClellan eds. , 2001 ) (identifying New York, New Jersey, Maryland, Virginia, and South Caroli-
na as having separate chancery courts ). 83 Id . (identifying Pennsylvania, Delaware, and North Carolina as granting “equity jurisdic-
tion” to their “common-law courts”). 84 Id. at 435-36 (noting that Georgia had “none but common-law courts,” and that Connecti-
only court of chancery”) . 85 Thomas O. Main , Traditional Equity and Contemporary Procedure , 78 WASH. L. REV.
429 , 449 - 450 , 449 n. 127 ( 2003 ). 86 von Moschzisker , supra note 17 , at 289 . 87 See 2 THE RECORDS OF THE FEDERAL CONVENTION OF 1787 , at 186 (Max Farrand ed.
1911 ). 88 Id. at 428. 89 Id. 90 Id . 91 See The Debates in the Convention of the Commonwealth of Virginia on the Adoption of
the Federal Constitution (June 21 , 1788 ) in 3 THE DEBATES IN THE SEVERAL STATE CONVEN-
TIONS ON THE ADOPTION OF THE FEDERAL CONSTITUTION 565 (Jonathan Elliot ed . 1836 ) (state-
ment of Grayson) . 92 Brutus , The Supreme Court: They Will Mould the Government into Almost Any Shape They
Please , N.Y. J. ( Jan . 31 , 1788 ), reprinted in 2 THE DEBATE ON THE CONSTITUTION 129, 132
(Bernard Bailyn ed. 1993 ). 93 Letters from the Federal Farmer III (Oct . 10 , 1787 ), reprinted in 2 THE COMPLETE ANTI-
FEDERALIST 234 , 244 (Herbert J. Storing ed. 1981 ). 94 THE FEDERALIST NO. 80 (Alexander Hamilton) , supra note 82 , at 415; see also 1 ST.
COMMONWEALTH OF VIRGINIA app. D at 263 (Philadelphia, William Young Birch & Abraham
Small 1803 ) (noting that, in each of Article III's jurisdictional fonts , “equitable circumstances may
judiciary, by virtue of this clause”). 95 THE FEDERALIST NO. 83 (Alexander Hamilton) , supra note 82 , at 438 . 96 U.S. CONST. art. III, § 2 . 97 Charles Warren 's magisterial work on the history of the Judiciary Act recounts the raucous
Warren , New Light on the History of the Federal Judiciary Act of 1789 , 37 HARV. L. REV. 49 , 96
( 1924 ). 98 Judiciary Act of 1789, ch. 20 , § 11 , 1 Stat. 73 , 78 ( 1789 ). 99 Id. 100 Id. § 22 , 1 Stat. at 84 . 101 Id. § 16 , 1 Stat. at 82; see Dows v. Chicago, 78 U.S. ( 11 Wall) 108 , 112 ( 1870 ) (dismiss-
whom the tax is paid”) . 102 Judiciary Act of 1789, § 12 , 1 Stat. at 80; see also Tull v. United States , 481 U.S. 412 , 417
( 1987 ) (noting that “those actions that are analogous to 18th-century cases tried in courts of equity
or admiralty do not require a jury trial” under the Seventh Amendment). 103 Root v . Ry . Co., 105 U.S. ( 15 Otto.) 189 , 206 ( 1881 ) (“[T]his distinction of jurisdiction,
any infringement of the right of trial by jury, as fixed by the common law . ”) . 315 Walker , 446 U.S. at 753; cf. Gasperini, 518 U.S. at 431 (“ Erie precludes a recovery in
federal court significantly larger than the recovery that would have been tolerated in state court . ”) . 316 See The Equitable Remedial Rights Doctrine, supra note 12 , at 417 (“ The policy behind
with 'substantive rights' and controlled by state law .”); Past and Present, supra note 12, at 839
given in a state court . ”) . 317 Guaranty Trust Co., 326 U.S. at 105 . 318 Id. at 103 ( quoting Black & White Taxicab & Transfer Co. v. Brown & Yellow Taxicab &
Transfer Co ., 276 U.S. 518 , 533 ( 1928 ) (Holmes , J., dissenting)); see also Crump, supra note 6 , at
1272 (arguing that “applying federal equity principles to remedies obviously carries all the un-
reject”) . 319 Guaranty Trust Co., 326 U.S. at 105 (citing Judiciary Act of 1789, § 16 , 1 Stat. 73 , 82
(codified at 28 U.S.C. § 384 )). 320 See Act of June 25, 1948 , Pub. L. No. 80 - 773 , 62 Stat. 869 ( revising , codifying, and enact-
ing title 28 of the United States Code) . 321 Matthews v. Rodgers , 284 U.S. 521 , 525 ( 1932 ) ; accord Atlas Life Ins . Co. v. W.I. S.,
Inc., 306 U.S. 563 , 569 ( 1939 ). 380 Wallis v . Pan Am. Petroleum Corp ., 384 U.S. 63 , 68 ( 1966 ) (holding that a federal court
stitution readily enact a complete code of law governing [it]”). 381 See, e.g., McCormick & Hewins, supra note 113 , at 135 . 382 U.S. CONST. art. III, § 2 , cl . 3 . 383 Id. art. III, § 2 , cl. 5. The Alien Tort Claims Act , 28 U.S.C. § 1350 , has similarly been
the Offenses Clause , U.S. CONST., art. I, § 8 , cl. 10 ). See generally Sosa v . Alvarez-Machain , 542
U.S. 692 ( 2004 ) ; Michael T. Morley, Note, The Law of Nations and the Offenses Clause of the
Constitution: A Defense of Federalism, 112 YALE L .J. 109 ( 2003 ) (discussing the original concep-
tion of the phrase “law of nations”) . 384 See Fitzgerald v. U.S. Lines Co., 374 U.S. 16 , 20 ( 1963 ) (“Article III of the Constitution
admiralty law .”); Hinderlider v . La Plata River & Cherry Creek Ditch Co. , 304 U.S. 92 , 110
( 1938 ) (“[W]hether the water of an interstate stream must be apportioned between the two States
State can be conclusive . ”) . 385 U.S. CONST., art. III, § 2 , cl . 7 . 386 28 U.S.C. § 1332(a)(1) ( 2012 ). 387 See supra notes 359-376 and accompanying text. 388 Cross, supra note 20 , at 205; Philip B. Kurland , Mr. Justice Frankfurter, The Supreme
Court and the Erie Doctrine in Diversity Cases , 67 YALE L.J. 189 , 201 ( 1957 ) ; McCormick &
Hewins , supra note 113, at 142 . 389 Cross, supra note 20, at 205 . 402 But see von Moschzisker, supra note 17 , at 289 ( pre-Erie article supporting federal courts'
aggressive implementation of federal equitable principles to protect perceived federal interests). 403 See Miree v . DeKalb Cty ., 433 U.S. 25 , 31 ( 1977 ) (holding that a court should not apply
duties of the United States hinge on its outcome”) . 404 Clearfield Tr . Co. v. United States , 318 U.S. 363 , 366 - 67 ( 1943 ) ; see also Bank of Am.
Nat'l Tr . & Sav . Ass'n v. Parnell , 352 U.S. 29 , 34 ( 1956 ) (“Federal law of course governs the
selves.”). 405 Miree , 433 U.S. at 31 ( stating that federal common law applies “in interpreting the rights
and duties of the United States under federal contracts”). 406 See United States v . Kimbell Foods , Inc., 440 U.S. 715 , 726 - 27 ( 1979 ). 407 United States v. Standard Oil Co ., 332 U.S. 301 , 310 - 11 ( 1947 ) (holding that the Govern-
policies”) . 408 See, e.g., Hinderlider , 304 U.S. at 110 . 409 See generally Banco Nacional de Cuba v. Sabbatino , 376 U.S. 398 ( 1964 ). 414 See supra notes 266 , 268 and accompanying text. 415 See Bd . of Revision of Taxes v . City of Phila., 4 A.3d 610 , 627 (Pa. 2010 ) (holding that a
Proler , 373 S.W.3d 748 , 764 - 65 , 764 n. 14 ( Tex. App . 2012 ) (declining to apply eBay to injunc-
and rev'd in part on other grounds, 437 S.W.3d 529 (Tex . 2014 ); Levisa Coal Co . v. Consolida-
tion Coal Co., 662 S.E.2d 44 , 53 (Va. 2008 ) (holding that a court must automatically issue a per-
manent injunction when a state statute authorizing injunctive relief is violated). 416 See IB Prop. Holdings, LLC v. Rancho Del Mar Apartments Ltd . P'ship, 263 P.3d 69 , 72
(Ariz. Ct . App. 2011 ) (“The relevant difference between . . . Winter and [Arizona's] standards is
rather than merely possible . ”) . 417 See, e.g., People ex rel . Dep't of Transp . v. Outdoor Media Grp., 17 Cal. Rptr. 2d 19 , 22 -
23 (Cal . App. 1993 ) (citing CAL . BUS. & PROF. CODE § 5461) . 418 See, e.g., ARK . CODE ANN. § 14 - 268 - 105 ( 1969 ) (cited in Hall v . City of Bryant , 379
S.W. 3d 727 , 733 (Ark. App. 2010 )). 419 CAL. CIV. PROC. CODE § 526 (West 2017 ) ; see also CAL . CIV. CODE § 3422 ; see, e.g.,
Sims Snowboards, 863 F.2d at 646. 420 CAL. CIV. PROC. CODE § 526(a)(7) . 421 N.Y. C.P.L.R . § 6301 (McKinney 2017 ) (preliminary injunctions) . 422 TEX. CIV. PRAC. & REM . CODE ANN. § 65 .011 ( West 2017 ). 423 See, e.g., City of Okoboji v . Parks , 830 N.W.2d 300 , 309 (Iowa 2013 ) (establishing gen-
Schwartz , 110 Cal. Rptr. 2d 861 , 867 (Cal. App. 2001 ) (establishing special standards for injunc-
tions prohibiting encroachments on real property); accord LSAC, Inc . v. State, 222 Cal. App. 4th
1265 , 1281 (Cal. App. 2014 ). 424 A.J. Indus. v. Alaska Pub . Serv. Comm'n , 470 P.2d 537 , 540 (Alaska 1970 ).