Commissioner v. Estate of Bosch

As the Court says, the issue in these cases is not whether the Commissioner is “bound" by the state court . decrees. He was not a party to the state court proceedings and therefore cannot be bound in the sense of res judicata. The question simply is whether, absent fraud or collusion, a federal court can ignore a state court judgment when federal taxation depends upon property rights and when property rights rest on state law, as they do here.

Since our 1938 decision in Erie R. Co. v. Tompkins, 304 U. S. 64, an unbroken line of cases has held that the federal courts must look to state…