Case BriefCivil Procedure, BauerState Law in federal courts, federal common law2/7/15Identity of CaseUnited States v. Standard Oil Co. of California, 332 US 301 (1947)Page 909 of the casebookSummary of Facts/Procedural HistoryAn oil transport truck hits a soldier. He is in the hospital for a few days for minor injuries, during which time he is still paid by the gov’t, and the gov’t pays his hospital bills. Standard oil pays the soldier 300 in satisfaction of all present and future claims he may have against them. The US gov’t attempts to sue standard oil for incapacitating their employee/interfering with contractual relationships. SCOTUS declines to allow that as a matter of law—there is no applicable law and they decline to make one—but say they could. Statement of the IssueWhere there is no law governing the gov’t’s ability to sue for interference with contract with its employee’s, and it shouldn’t be a state issue so we don’t want the federal courts to follow state law, what do? HoldingIf it is something that clearly should not be a state issue, and Congress has declined to make a law, and there is reasonable basis for declaring a law that would not grossly overstep the separation of powers, the supreme court can declare federal common law. ReasoningLike it says in the holding. It may be an issue of immediate importance where we can’t wait around for congress. Congress is welcome to change the law later, so there is no lasting harm, unless there is. Evaluation The court declined to make a law in this case and dismissed the suit. Thought the consequences of allowing the gov’t to sue entitites for incapacitating its employees were a little too big. 15 years later, Congress passed that law.
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