In Erie Railroad Co. v. Tompkins, where Tompkins sued a New York company that owned a train that hit him in Pennsylvania, the Supreme Court held that:

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In Erie Railroad Co. v. Tompkins, the Supreme Court held that federal common law did not exist in diversity-of-citizenship cases and that federal courts would have to apply state law instead. This decision was a significant departure from previous practice, which had relied on federal common law in many cases involving interstate commerce.