Emily, a resident of State Alpha, files a lawsuit against Beta Industries, a corporation incorporated in State Gamma, in federal court based on diversity jurisdiction. The dispute involves a contract that was signed and to be performed entirely in State Alpha. Under State Alpha law, the statute of frauds requires that certain contracts be in writing to be enforceable. Beta Industries did not provide a written contract. What law should the federal court apply to determine whether Emily's contract is enforceable?
A combination of State Alpha and State Gamma laws based on the parties' locations.
State Gamma law because the defendant is incorporated there.
State Alpha law because the contract was signed and to be performed in State Alpha.
Federal common law since the case is being heard in federal court.
The federal court should apply State Alpha law to determine the enforceability of the contract because, in diversity cases, federal courts apply the substantive law of the state in which they sit. This includes the statute of frauds provisions of State Alpha.
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