A citizen of State A filed a negligence lawsuit against a citizen of State B in the federal district court for State B. The plaintiff is seeking $100,000 in damages, and the court's jurisdiction is based solely on diversity of citizenship. Under State B's common law, the defendant has the burden of pleading and proving the plaintiff's contributory negligence. There is no specific federal statute on this issue. Which law should the federal court apply to determine the burden of proof for contributory negligence?
State A's law applies because the plaintiff is a citizen of State A.
The court should apply a federal common law standard, as the Federal Rules of Civil Procedure are silent on the issue.
Federal procedural law applies because the burden of proof is a procedural matter.
State B's law applies because the burden of proof is considered substantive law for Erie purposes.
The correct answer is that State B's law applies because the allocation of the burden of proof is considered substantive law under the Erie doctrine. In Erie Railroad Co. v. Tompkins, the Supreme Court held that in diversity cases, federal courts must apply state substantive law but federal procedural law. To distinguish between substance and procedure, courts often apply the 'outcome-determinative test' established in Guaranty Trust Co. v. York. Under this test, a state law is considered substantive if failing to apply it would significantly affect the outcome of the case. The burden of proof is outcome-determinative and is therefore treated as substantive law. Thus, the federal court must apply State B's law on the burden of proof for contributory negligence.
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