A more thorough explanation:

Definition: American common law is a body of law that comes from judicial decisions, rather than from statutes or constitutions. It is based on the English legal system and is the general Anglo-American system of legal concepts that form the basis of the law in jurisdictions where the system applies. It is also the body of English law that was adopted as the law of the American colonies and supplemented with local enactments and judgments.

Examples:

• Federal common law: This is the body of decisional law derived from federal courts when adjudicating federal questions and other matters of federal concern, such as disputes between the states and foreign relations, but excluding all cases governed by state law. An example is the nonstatutory law applying to interstate streams of commerce.
• General federal common law: This is the judge-made law developed by federal courts in deciding disputes in diversity-of-citizenship cases before the period of Erie v. Tompkins (304 U.S. 64, 58 S.Ct. 817 (1938)). Since Erie, a federal court has been bound to apply the substantive law of the state in which it sits.
• Common law of England: This is the body of law that evolved from custom and was the body of law created by and administered by the king's courts. Equity developed to overcome the occasional rigidity and unfairness of the common law. Originally the king himself granted or denied petitions in equity; later the task fell to the chancellor, and later still to the Court of Chancery.

These examples illustrate how American common law is derived from judicial decisions and how it is based on the English legal system. They also show how it has evolved over time and how it is applied in different contexts, such as federal law and state law.