[inquest]

A federal court sitting in a diversity case, i.e. between residents of different states applies the state substantive law (of the state which has the closer nexus to the litigation). This was decided by the US Supreme court before the War in a famous case called Erie v. Thompkins.

That's an awfully bizarre rule. One would think that due process would require that the defendant in the suit be subject to the laws of his state, not the state of whoever doesn't like what he's doing. It's like saying we should be subject to the Sharia if we disparage Mohammed.

[Modernman]

One would think that due process would require that the defendant in the suit be subject to the laws of his state, not the state of whoever doesn't like what he's doing.

It really depends on the facts of the case. If I'm a Virginia resident, you're a Maryland resident, we had an auto accident in Virginia and I sue you in federal court in Virginia, Virginia substantive law would apply because Maryland has very few contacts to the case. Now, say we had the accident in Maryland, you're from Maryland and I'm a Virginian and I sue in Virginia federal court, the Virginia federal court would apply Maryland sunstantive law since Virginia has few contacts to the case.