Aligning Law and Forum: The Home Court Advantage
53 Pages Posted: 11 May 2013 Last revised: 14 Jan 2016
Date Written: October 2013
When courts and legislatures choose where to resolve a dispute, they often must consider whether questions of law should be decided in the “home” court. When should, for instance, Delaware state courts decide questions of Delaware state law? The choice between the home forum and others is particularly stark in corporate law, where out-of-state courts must often apply the law of the state of incorporation. Litigation over corporate deals increasingly takes place in multiple, competing jurisdictions, presenting a clear choice between resolution in the home court or out of state. Beyond corporate law, the question arises any time legislatures must decide whether jurisdiction is exclusive, or courts must determine whether to stay a case or refer a question by way of certification, abstention, primary jurisdiction, or other sorting mechanisms. All of these instances raise the same normative question: When should law be decided in the home forum?
In response, scholars and courts have pointed to vague notions of comity or focused on a single legal context. In contrast, this Article develops a robust theoretical account that crosses legal areas. It analyzes the tension in the U.S. legal landscape between doctrines that link law and forum (for instance, exclusive jurisdiction) and those that affirmatively separate them (for instance, diversity jurisdiction). It identifies two main functions of home court decisions: the lawmaking function derived from their unique power to bind, and the distinct repeat-player relationship that the home forum has with the body of law, which supports a claim to expertise. Finally, the Article uses these functions as the basis for an interest-balancing approach to determining when law should be decided at home.
Keywords: conflicts, federalism, corporate law, jurisdiction, home court, courts, judges, forum, litigation, corporate litigation, business litigation, multijurisdictional deal litigation, Delaware, Erie, diversity jurisdiction
JEL Classification: K40, K41, K22, K20
Suggested Citation: Suggested Citation