## Facts

- Sharon L. Russell enrolled at Salve Regina College and entered its nursing program.
- Nursing program officials expressed concern about Russell’s weight and conditioned her continuation on weight-loss commitments.
- The College requested that Russell withdraw from the nursing program for failing to meet those commitments.
- Russell sued in federal district court under diversity jurisdiction, alleging breach of an implied agreement to educate her.
- The district court predicted that Rhode Island law would treat the dispute as an implied contract and would apply the substantial performance doctrine in the academic setting.
- The district court denied the College’s motion for a directed verdict, and a jury returned a verdict for Russell.
- The First Circuit affirmed, applying a deferential approach to the district court’s interpretation of Rhode Island law.
- The Supreme Court granted review to decide the proper appellate standard of review for district-court determinations of state law in diversity cases.

## Issues

1. Whether a federal court of appeals may apply a deferential standard when reviewing a district court’s determination of state law in a diversity case, rather than reviewing the legal determination independently.

## Decision

- The Supreme Court held that courts of appeals must review de novo a district court’s determinations of state law.
- The Court rejected a deferential standard based on a district judge’s asserted “local expertise.”
- The Court vacated the First Circuit’s judgment and remanded for further proceedings under the de novo standard.

## Legal Principles

- In diversity cases, a district court’s determinations of state law are legal rulings subject to independent (de novo) appellate review.
- Deferential review of state-law determinations is inconsistent with Erie’s goals of discouraging forum shopping and avoiding inequitable administration of the laws.
- Allowing deference risks inconsistent interpretations of state law among federal district courts within the same state, creating nonuniform enforcement of state-created rights.
- Arguments that courts of appeals “effectively” conduct de novo review despite professing deference do not justify retaining a deferential standard; when de novo review is required, no appellate deference is permissible.

## Conclusion

The Court required federal appellate courts to independently review district courts’ state-law determinations in diversity cases, vacating the affirmance that rested on deference and remanding for reconsideration under de novo review.


Salve Regina Coll. v. Russell, 499 U.S. 225 (1991)