During the early 1970's, a medical malpractice crisis was perceived in the United States. An increasing number of costly and time-consuming lawsuits alleging medical malpractice against doctors, hospitals, and other health care providers caused malpractice insurers to raise premiums substantially, which in turn threatened to curtail the availability of adequate health care at reasonable cost. State legislatures responded to the crisis with a variety of substantive and procedural measures intended to reduce the number of litigated claims and the size of jury awards. One of the principal steps taken in a majority of states was the creation of extrajudicial panels comprised of some combination of doctors, attorneys, judges, and laymen for the consideration of medical malpractice claims prior to the ordinary trial process. Such panels, variously termed screening, mediation, review, advisory, hearing, or arbitration panels, generally determine in an informal manner whether a plaintiff's claim has merit before it is presented to a jury, thereby facilitating early settlement of meritorious claims and discouraging the prosecution of groundless ones. The desired result is a reduction in the costs, expenses, and consumption of time associated with the litigation of medical malpractice actions in the courts, thus easing the malpractice crisis. Inevitably, some medical malpractice claims find their way into federal district courts pursuant to diversity-of-citizenship jurisdiction. If the federal court is located in a state which requires the screening of such claims, the court must decide whether, and to what extent, the panel procedures must be utilized. The court's decision will be based on the resolution of several issues: Whether the particular claim and litigants fall within the scope of the panel legislation; whether the legislation is constitutional under state and federal principles of equal protection, due process, and the right to jury trial; and whether the legislation is a state law which must be applied in federal court under the Rules of Decision Act as construed by Erie Railroad v. Tompkins and its progeny. The constitutionality of screening panels has been upheld by most courts that have considered the issue, and other commentators have treated the subject in depth. This article focuses upon the three unique problems presented by the applicability of screening panel legislation in federal courts: Erie, the Federal Rules of Evidence, and the seventh amendment right to jury trial. Section I surveys the principal types of screening panels that have been utilized to date. Section II analyzes the evolution of the standard to be applied under Erie in determining whether state rules having both procedural and substantive attributes must be applied in federal courts. The recommended test is a flexible one, but in accordance with the principles of federalism, it prevents impairment of clearly discernible substantive policies of the states. Section III takes up the question whether Erie requires compliance with screening panel hearings in federal courts under such standard. Section IV examines the trio of authorities-Erie, the Federal Rules of Evidence, and the seventh amendment-that must be considered in determining whether panel findings may be admitted into evidence at a subsequent trial in federal court. It is concluded that a proper regard for the principles of federalism requires application of screening panel legislation in federal diversity actions in accordance with state law and that the seventh amendment is not thereby violated.
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