System Formatter Failed While Erasing External Hard Drive Mac
The solution that works on both OS 10.11 El Capitan and on OS 10.10 Yosemite is:


Open up Disk Utility
Select the actual drive, which is the lower part that will most likely be greyed out:
Then go to Erase
Select MAC OS EXTENDED (Journaled, Encrypted) It's important to select Encrypted
Then enter a password and wait.(It will run without a problem )
Then you can again erase and take the password down and use your drive again.