Big Head Civ Pro

8/3/2019 Big Head Civ Pro

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11/30/2011 12:44:00 PM

Word List

Attachment

Cause of action

Choice of law

Common law

Constructive service

Counterclaim

Cross-claim

Declaratory judgment

Demurrer

Directed verdict

Discovery

Erie

Fact pleading

Federal question

jurisdiction

Forum non conveniens

General jurisdiction

In rem

In personam

Interpleader

Interrogatories

Judgment as a matter of

law

Judgment N.O.V.

Klaxon rule

Long-arm statute

Motion to dismiss

Notice pleading

Personal jurisdiction

Personal service

Preliminary injunction

Quasi in rem

Remittitur

Res judicata

Rules Enabling Act

Rules of Decision Act

Service of process

Special appearance

Specific jurisdiction

Summary judgment

Temporary restraining

order

Transfer of venue



Civil Procedure: What is it?

Civil Procedure deals with procedure, not substance. Civil Procedure focuses

on rules. Civil Procedure is the study of the principles surrounding the

resolution of civil disputes by the courts and the various tools available to alawyer who must bring or defend a lawsuit. FRCP Rule 1 – The rules are

meant to ensure just , speedy , and inexpensive lawsuits. “Fair, fast, and

cheap.”

Fairman says that it’s all a balancing test between efficiency and equity. We

want to do things cheaply, yet fairly. There are elements of this balance

either explicitly in the courts’ opinions or the statutes that courts apply or

embedded in the decisions that have to be made.

The five themes

Judicial power – Who has it? What courts have power to adjudicate disputes

(i.e. jurisdiction)?

Dispute parameters – How do we take big cases and winnow them down into

what’s actually going to get tried, if they get tried? The tools of setting these

parameters are all procedural.

Obtaining finality – The more that happens to a lawsuit in different courts,the harder it is to undo.

Costs – Every lawsuit has its costs, monetary or non-monetary.

Balance between equity and efficiency – cheap & quick and fair are at

odds. We can have more of one or more of the other…we need to make

tradeoffs.

The five pedagogical objectives

Identify and apply “Black Letter” procedural rules – some rules is rules (c.f.

FRCP Rule 8). Know them.

Determine the doctrinal and policy implications of the rules.

Understand the theoretical implications of the rules. We want to find truth, if

there is a truth. We let them sue now, and find truth later.

Develop a critical perspective: how do we limit frivolous lawsuits?



Skill: be able to read cases critically for procedural issues. In this course,

we’re concerned with procedure and not substance.

Personal jurisdiction

Pennoyer v. Neff – When does a state have appropriate jurisdiction over an

out-of-state defendant? Pennoyer asks: Is it there? Pennoyer introduces

three basic concepts that are still important today: (1) Power – jurisdiction is

power, and the power of states or other jurisdictions (federal courts) to

make you do what you might otherwise not do; plus limits to that power

imposed by the Constitution itself. (2) Consent – If you consent to

jurisdiction, these black and white rules go out the window. (3) Notice – the

“concealed” strand of Pennoyer . This will eventually become a constitutional

requirement. At the time of Pennoyer , we have sort of a duality of

notice. For in personam jurisdiction, you need personal service of process

within the state. For in rem or quasi in rem actions, you can be served by

publication.

In rem – an in rem is an action where the court is trying to decide the rights

in a piece of property itself (in the thing). In personam – This is also known

as personal jurisdiction. This has to do with jurisdiction over a person and

their personal rights and liabilities. Conceptually, think of in rem as land. If you stop thinking about in rem as land, you’ll get in trouble.

Quasi in rem – determines the rights of a person in a thing. Not the rights

of the world in a thing, but the rights of specific individuals in a thing. There

are two kinds of quasi in rem: (1) True quasi in rem: trying to secure a

preexisting claim in the property, or extinguish someone else’s. (2)

Substitute for personal jurisdiction where you apply a defendant’s property

to satisfy a claim that is unrelated to property.

Collateral attack – means you start a second suit to challenge the judgment

of the first suit. In collateral attack, you wait for them to come and get your

property, but then you argue: “They can’t have my property! The first

lawsuit wasn’t valid because they didn’t have jurisdiction!” Why use

collateral attack from a strategic standpoint? It’s cheaper than hiring an out-



of-state lawyer to argue on your behalf. If that state tries to enforce the

judgment, they’ll have to try to enforce it in your state.

Harris v. Balk – This case would be decided differently today. Epstein sues

in Maryland to get Harris to pay him. Then Balk sues Harris in NorthCarolina. Harris’s defense is that he’s already paid his debt to Epstein, such

that Balk should get his money back from Epstein. What must the

jurisdictional issues be? North Carolina, the Supreme Court rules, must

enforce the Maryland judgment, because personal jurisdiction was obtained

over Balk when Harris entered Maryland.

We’re trying to figure out if debts are a personal obligation or in

rem obligations. The Court says that the debt travels with the debtor,

making the creditor subject to personal jurisdiction wherever the debtor

goes. If one is a creditor, that sucks because if you lend people money, and

then you’re subject to personal jurisdiction wherever that person goes, and

thus you might get sued anywhere that debtor goes. I, the creditor, am in

big trouble!

Hess v. Pawloski – An out-of-state defendant gets into an accident. In order

for the person who got hit in Massachusetts to sue, they must serve the

person that hit them personally in Massachusetts. So, Massachusetts passesa statute that says that when you drive on Massachusetts roads, you

implicitly consent to Massachusetts jurisdiction. This case would be decided

the same way today.

Minimum contacts

International Shoe Co. v. Washington – Shoe introduced our modern concept

of personal jurisdiction, which involves “minimum contacts” and “traditional

notions of substantive justice and fair play”. Shoe asks: Is it fair ?

Under what conditions is a corporation subject to personal jurisdiction in a

particular state? The Court interprets the due process clause and the

Fourteenth Amendment to mean that if a company has “minimum contacts”

in a state, they may be subject to being sued in that state.



What is the modern test? We have a brand new test for personal

jurisdiction! It’s the minimum contacts test . If the defendant is out of state,

yet has certain minimum contacts within a jurisdiction, we will determine

whether that court has personal jurisdiction based on “traditional notions of

fair play and substantial justice”.

Expanding Shoe to cover in rem

Shaffer v. Heitner – Shaffer seeks to make Shoe the standard for more or

less all jurisdictional questions. In a quasi in rem action, specific jurisdiction

depends on how closely related the defendant’s contact to the forum is to

the claim itself. Does the Delaware court have jurisdiction over the

defendants or their property or both? NEW RULE! The Shoe model should be

applied to jurisdiction in rem as well as in personam. Shoe seems to deal

with in personam jurisdiction rather than in rem jurisdiction. The present

case is about in rem jurisdiction, therefore, on its face, Shoe doesn’t seem to

apply to Shaffer .

Pennoyer + Harris = if we attach the property at the start of the lawsuit, and

the property is located within the jurisdiction of the forum, then the forum

has in rem jurisdiction. Now , the Court says that Shoe rules everything

and Harris v. Balk is explicitly overruled! However, the basic

principles of Pennoyer are not overruled.

What’s the rationale? Jurisdiction “over a thing” is sort of a euphemism for

jurisdiction “over the interests of a person in a thing”. Everything is owned



by somebody, so whatever or wherever the property is, we’re really trying to

get power over the person through their stuff.

Is the location of the stuff relevant anymore? The test of Shoe is “minimum

contacts” such that the suit does not offend the notions of “fair play” and “substantial justice”. So the location of the stuff is relevant in so far as it is a

contact .In rem gave property a special status; Shoe says that property

is just another contact , nothing special. We’ll just add it into the mix. The

Court says that it would be unusual for a state not to have jurisdiction in a

controversy over some land in a state, because that land is what it’ s all

about and would constitute sufficient contacts.

After Shaffer , we will still see courts talking about in rem and quasi in

rem. The law says that all assertions of jurisdiction must be made according

to Shoe. Shoe, in turn, encompasses in personam, in rem, and quasi in

rem. UnderShoe, you don’t need to attach property to

satisfy Constitutional jurisdictional principles. State law might establish other

requirements when you file a lawsuit over some property. In practice, you

really should attach the property.

Specific jurisdiction

Specific jurisdiction is jurisdiction over a specific claim in question, though

not necessarily other claims.





McGee v. International Life Insurance Co. – If the contact between the

defendant and the state of California is minimal, such contact must

be closely related to the claim in order for the state of California to have

jurisdiction. In other cases, we’ve heard a lot about the defendant’s interest,

but in this case we hear a lot more about the plaintiff ’s interest and the

state’s interest. Stevie Y. describes McGee as the “outer extreme” of

jurisdictional aggressiveness.

Hanson v. Denckla – Are there sufficient contacts between the defendant

and the forum for the state to have specific jurisdiction? If there are only

minimal contacts between a state and a defendant, then the contacts must

be closely related to the claim. Mere contracting is not enough to establish



personal jurisdiction. There must be more in the way of contacts. As we

move beyond McGee and Hanson, we’ll see the Court sort of back off from

having such limited contacts constitute jurisdiction. Justice Warren suggests

that the defendant must act to “ purposefully avail ” himself of the “privilege

of conducting activities within that state”.

Is this “stuff”, the transacting of business and sending of money between

the Delaware trustee and the now dead lady in Florida sufficient to establish

minimum contacts? The Court concludes that it is not enough. The Court

concludes there is no personal jurisdiction in Florida over

the Delaware trustee. The Court applies the minimum contacts test just like

in McGee.

World-Wide Volkswagen Corp. v. Woodson – Can a state court exercise in

personam jurisdiction over a nonresident corporation when the only

connection between the defendants and the forum is that one of their

products ended up in the forum state? In order for a state court to

exercise in personam jurisdiction over a defendant, there must exist

minimum contacts between the defendant, forum, and claim. The key to the

case: Does the test of minimum contacts a one-part test or a two-part test?

Justice White says that the main functions of the Shoe test are (1) to protectthe defendant against having to litigate in far-off lands and (2) to keep the

states’ power in line. The first function is known as the “convenience” prong

of Shoe. The second function is known as the “sovereignty” prong.

The five fair play factors

Asahi Metal Industry Co. v. Superior Court – Asahi is the case that makes

the five factor test law . In World-Wide, it’s only dicta. On an exam, know

and go through all five prongs. However, the big three are the first three,

where the defendant’s burden is primary. (1) Burden on the defendant –

burdens on corporate defendants tend to be diluted as compared to burdens

on individual defendants. (2) The state’s interest – what interests does the

forum have in having that litigation in that state as far as protecting its

citizens and corporations? (3) The plaintiff’s interest – everyone would prefer



to sue in their own forum. (4) Interstate efficiency interest – is this forum

better, more efficient, more expedient, or cheaper than any other forum? It

is rare that jurisdiction in a case turns on efficiency, because it can usually

be argued both ways. (5) Interstate policy interest – this would be a

stretch. The Courts of Appeals these days tend to lump this and efficiencytogether.

Note that these factors have nothing to do with minimum contacts, but

rather with “traditional notions of fair play & substantial justice”. Justice

White implies that “minimum contacts” is the threshold , and thus if you

don’t have contacts, you never get to fair play. But what do we need in

terms of contacts to meet the threshold? The court never gives us a clear

definition of “minimum contacts”.

“Stream of commerce” and “stream of commerce plus”

One camp in the Court believes that putting something in the stream of

commerce does constitute purposeful availment. What O’Connor says,

however, is that if you only put something in the stream of commerce but

don’t do any more, it’s not an act of purposeful availment. O’Connor needs

additional conduct to meet her standard: “stream-of-commerce plus”. For

example: (1) Designing a product for a forum state, (2) advertising to aforum state, (3) providing customer service in the forum state, or (4)

marketing the product through sales agents in the forum state. This is not

an exhaustive list, and it’s not the law of the land.

Burger King Corp. v. Rudzewicz – Does Rudzewicz’s contract with Burger

King evince substantial ties to the state of Florida? In considering whether a

contract creates a contact, there are four factors to be considered: (1) The

nature of prior negotiations between the parties, (2) the “contemplated

future consequences” of entering into the contract, (3) the terms of the

contract, and (4) the course of dealing between the parties. There’s one

thing we know for sure from this case: Simply making a contract with an

out-of-state defendant is not enough to create sufficient contacts.



For our purposes, we may think about specific jurisdiction as a two-part

test: (1) Check for minimum contacts, then go on to (2) fair play and

substantial justice. We’re two years before Asahi , which reasserts this

threshold test.However, the Court also says “If it’s really, really fair to

exercise jurisdiction, we can let it slide by with less contacts than wenormally would.”

Rule 4(k)(2)

A federal court can generally hale a defendant if state courts in the state

where the federal court is located also have personal jurisdiction over that

defendant. In other words, the federal court’s jurisdictional reach is equal to

that of a trial court (a court of general jurisdiction) in that state.

The thing that really interests Fairman is Rule 4(k)(2): If you’ve got

minimum contacts and fair play, then you can summon or take a waiver of

service from somebody who can’t be brought into any state’s trial court

(court of general jurisdiction). There could be foreign defendants, let’s say

businesses, that aren’t subject to the general jurisdiction of a specific state

court. That means it lacks minimum contacts with any one state. However,

maybe you have minimumaggregated contacts with the country

overall. “This is a weird rule!” It posits an exception to our usual territorialconcept of personal jurisdiction.

Personal jurisdiction on the internet

The “Zippo” test has been adopted by most courts of appeal. Zippo does to

Internet cases what other cases have done to other industries. You might

use “stream of commerce” for manufacturing; with Internet stuff, you

use Zippo.Zippo proposes that there is a spectrum of websites from

“passive” to “active”. Active websites sell things, while passive websites just

show you stuff. There’s no personal jurisdiction if a site is passive. There is

personal jurisdiction if the site is active. However, in reality, everything is

intermediate and you must do a factual analysis as to the level of

interactivity of the site and the jurisdictional consequences that follow.



General jurisdiction

General jurisdiction is usually easy! It’s hard to find hard cases on general

jurisdiction. Specific jurisdiction is the easy route; general jurisdiction is the

hard route. General jurisdiction requires continuous and systematic contacts. You must have more of a relationship with a forum to constitute

general jurisdiction than to be subject to specific jurisdiction. Think of

general jurisdiction as “super contacts”.

Washington Equipment Manufacturing Co. v. Concrete Placing Co. – The

defendant corporation is based in Idaho. To do business in Washington, it

had to obtain a certificate of authority and register an authorized agent. Did

the defendant consent to general personal jurisdiction when it got the

certificate and registered an agent? NEW RULE! In Washington, by statute,

compliance with mandatory requirements in order to do business

in Washington does not impose personal jurisdiction on a foreign

corporation.

Helicopteros v. Hall – Is it consistent with the Due Process Clause of the

Fourteenth Amendment for Texas to assert personal jurisdiction

over Helicol? Blackmun looks at the contacts individually and determines

that each one in isolation is not continuous and systematic, thus there is notgeneral jurisdiction. Fairman suggests that Blackmun should have looked at

the contacts in toto. Here’s the problem: you can look at the contacts apart

or together, and depending on how you do it, you’ll get to a different result.

In this case, the Supreme Court gives us its only statement on the

distinction between general and specific jurisdiction. We knew that

in Perkins there were enough contacts, while in Rosenberg there

were not enough contacts. InHelicopteros, the four contacts mentioned

are not enough for jurisdiction.

For specific jurisdiction, we have minimum contacts and fair play. For

general jurisdiction, we continuous and systematic contacts, but is there a

parallel fair play standard in general jurisdiction? You should argue the fair

play aspect even when dealing with general jurisdiction.



Transient jurisdiction

Burnham v. Superior Court – The rule is: if you’re temporarily in the forum,

and I can serve you, I gotcha! While Mr. Burnham, the appellant, wasin California briefly he was served process. If a defendant is served process

within a state’s borders, does due process require a connection between the

lawsuit and the defendant’s contacts within the state? The rule is eazy . If we

serve you in our state, we gotcha.

Consent – forum selection clauses

Carnival Cruise Lines, Inc. v. Shute – The Shutes went on a cruise. On the

ticket, there was a forum selection clause that said any litigation related to

the cruise must be tried in Florida. Is the forum selection clause

enforceable? Courts have the responsibility to determine whether forum

selection clauses in form passage contracts are fair. Forum selection clauses

are considered permissible in this context for several policy reasons. The

ultimate question is one of “fundamental fairness”. We won’t allow the cruise

line to select a forum with the purpose of discouraging legitimate

lawsuits. “Basically, forum selection clauses are good law .”

Notice – service of process

Mullane took us into a different constitutional issue that is closely related to,

though not identical to, personal jurisdiction: notice. The result in Mullane is

that the lawsuit gets dismissed not because the forum didn’t have

jurisdiction over the defendants, but rather because the defendants were not

given adequate notice. Service of process is the method by which you notify

someone about a lawsuit. Process is the papers themselves. By FRCP Rule

12, you can get cases dismissed by invalid service of process or invalid

process.

Mullane v. Central Hanover Bank & Trust Co. – May a state constitutionally

dispense with personal service of process even if it knows how to contact a

defendant? A method of service of process must either be (1) “reasonably



certain” to provide actual notice, or (2) the lesser of several evils, that is, a

“feasible” form of notice that is “not substantially less likely” to give actual

notice than other options.

This is a classic in rem type case. The Court says we could probably have inrem jurisdiction. (Note that this case comes before Shaffer .) They basically

say that if the process is decent, states will have jurisdiction. They base this

view of jurisdiction, including transient jurisdiction, more or less on

tradition. Yeazell calls this “jurisdiction by necessity”.

What are the elements of due process in this context? The defendant

must know about the suit and be able to defend himself . How do we decide if

notice is constitutionally okay? The notice must be “reasonably calculated,

under all circumstances, to apprise interested parties of the pendency of the

action”. It will depend on the circumstances! The Court says publication

notice is not reasonably calculated to inform them of their rights if you know

who they are and where they live.

How do we do notice today? We do certified mail with a receipt request. This

is certainly “reasonably calculated”. That doesn’t mean that you have to do it

that way. FRCP Rule 4 tells you the different ways you can serve process.

Rule 4(d)

What do you do if you want to commence a suit with minimum cost? There

is an appendix of forms attached to the Federal Rules so that you don’t have

to make up your own forms. What’s in the form just comes right out of what

the rule itself says. Form 1-A is the “Notice of Lawsuit” and Form 1-B is the

form that the defendant signs and returns. So you ask for the waiver of

service under Rule 4.

What would happen if the defendant ignored the requested waiver of

summons? You don’t have to waive, but there is an incentive for you to

waive. You get more time to respond if you waive, and there is also a lower

cost. The defendant has a duty to avoid unnecessary costs; if you don’t

waive, those costs will be imposed on you. What are those costs? It’s the



cost of hiring a process server, like a magistrate, sheriff, or a private

server. This may cost several hundred dollars. Costs and fees are two

different things, so far as we’re going to think about it for now.

“Long-arm” statutes

These statutes establish a subset of the scope of personal jurisdiction that

the Constitution allows. If a state chooses, they can make their authority

coextensive with the Due Process Clause: “The long-arm statute of the state

of X is coextensive with the Due Process Clause of the Constitution.”

The first question you should ask when you are dealing with issues of

personal jurisdiction is: Does it satisfy the long-arm statute? If the answer is

“no”, then you’re done. If the answer is “yes”, then you move to Due

Process. Courts will avoid ruling on constitutional questions when it can.

So, the long-arm statute offers a threshold test . You always look at it first,

because it is no wider than the constitutional limit of the state’s authority. If

a long-arm statute partially busts out of Due Process, you may need to go to

the next level to make sure that the statute itself is constitutional.

Gibbons v. Brown – Does the Florida “Long-Arm” statute give the state jurisdiction over Gibbons? Florida shall have jurisdiction over a defendant

who is “engaged in substantial and not isolated activity” in Florida. This is

construed to be a higher standard than the federal constitutional one. The

question is whether the “long-arm” statute in Florida gives the state

jurisdiction over Gibbons for the purposes of the suit. “This case is irrelevant

to the scheme of jurisprudence in this country.” It’s a “piddley little case out

of an intermediate court in Florida”.

Venue – § 1391

Venue specifies a specific court within a jurisdiction where parties can

litigate. For example, let’s say you know you have jurisdiction in Texas, but

there are four federal district courts there. Venue tells you

where exactly you’re going to do your trial.



Why do we have venue? It helps select where a case can be properly

brought. Isn’t that precisely what personal jurisdiction does? If we

eliminated venue altogether, we wouldn’t have too many problems since

personal jurisdiction is pretty well-developed.

Where does venue fit into our decision tree of jurisdiction? What about

notice and forum non conveniens? Are they preliminary matters, or matters

to be determined after the jurisdictional analysis? Fairman says that it

doesn’t matter much. He says that venue will almost always come after

jurisdiction because no jurisdiction usually means improper venue too. In

other words, the venue test often collapses into the tests for personal

jurisdiction.

We will look at the federal venue statute, 28 U.S.C. § 1391, as a model for

all venue statutes. Part (a) deals with diversity-only claims. Part (b) deals

with not-diversity , or “federal question” -type cases. Part (c) is a special

provision for corporate defendants which says that venue basically collapses

into personal jurisdiction.. Part (d) is all about aliens. Parts (e) and (f) are all

about governments.

There is a rule that is not in the statute: “Venue for one is venue forall.” The exception is in the case that follows, where even though the venue

is appropriate for the foreign defendants, it may not be appropriate for the

domestic defendants. Furthermore, just because an alien defendant can be

sued in any district doesn’t mean there will be personal jurisdiction over

them in any district. This is analogous to the provision that collapses venue

and personal jurisdiction for corporations.

Dee-K Enterprises, Inc. v. Heveafil Sdn. Bhd. – The plaintiffs are American

companies suing foreign companies. The defendants challenged personal

jurisdiction and venue. Is venue proper in the Eastern District of

Virginia? The foreign defendants may be sued in any district. The American

distributors can only be sued in districts where they can be “found”. The

court looks at the contacts of the American defendants in Virginia and finds



that some of the American distributors can be found in the Eastern District of

Virginia, though some may only be found in the Western District of Virginia.

In a diversity action, we would use state law. However, in this international

anti-trust case, they look to the federal statute, which is the Clayton Act. Wecan also look at FRCP Rule 4(k)(2), which has a provision for defendants

without contacts with any one state sufficient to constitute jurisdiction.

Forum non conveniens

Piper Aircraft v. Reyno – Should the trial court be allowed to issue a forum

non conveniens dismissal? A court has the authority to decline jurisdiction if

the suit may be brought more appropriately in another forum. Marshall says

that you can’t weigh the “change of law” effect on the plaintiff that heavily in

deciding whether to grant a forum non conveniens dismissal. He says that it

can be an element in the decision, but it’s not the end of the

story. Marshall says, therefore, that you can argue for a more convenient

forum even when that forum would have law that is less favorable to the

plaintiff.

The Gilbert balancing test is the black letter law of forum non conveniens. It

weighs “private” and “public” factors. The private factors are: (1) Therelative ease of access to proof, (2) the availability of witness subpoenas,

(3) the cost of getting witnesses, and (4) the possibility of viewing of the

premises if called for. The public factors are: (1) Court congestion, (2) local

interest in having local controversies decided at “home”, (3) the forum’s

familiarity with substantive law, and (4) unfairness of burdening citizens with

jury duty for case unrelated to forum. Compare this to the “five factor” test

for “fair play” that comes out of World-Wide.

Everything we have done in the course up to now can be trumped by a

forum non conveniens motion. You can say: I have power, there is proper

notice, Due Process is satisfied. However, I’m not going to try this

case. Courts have the power to do this. It’s sort of like saying now that

we’ve balanced everything, let’s balance again with an even mushier

standard.



Transfer of venue – §§ 1404, 1406, and 1631

Under 28 U.S.C. § 1404, you can only transfer a case to a district court that

has personal jurisdiction and venue. This provision sort of “bootstraps” thevenue statute: 28 U.S.C. § 1391. The test in § 1404 is whether the current

court is: (1) Convenient to the parties, (2) convenient to the witnesses, and

(3) “in the interest of justice”. This sounds a little bit like

the Gilbert test. This is sort of like an inter-court forum non conveniens. This

is a soft test that allows the court a lot of discretion. In a practical sense,

what will happen with these litigants?

28 U.S.C. § 1406 says that if you mess up and file in the wrong venue, they

can just transfer it over rather than dismiss the claim. Also, under 28 U.S.C.

§ 1631, you can transfer for want of jurisdiction.

Subject matter jurisdiction

Not every court can hear every kind of case. Some are courts of general

jurisdiction, which can hear basically any kind of case except if a statute or

legal precedent says they can’t. Some are courts of limited jurisdiction, so

called because the statutes that set them up say exactly what kind of casesthey are limited to.

Every state has at least one court of general jurisdiction. In each state, there

are courts of limited (subject matter) jurisdiction and general (subject

matter) jurisdiction. Make sure to distinguish this from general (personal)

jurisdiction.

On the other hand, federal courts are limited by the Constitution. It’s up to

Congress to decide just how narrow to make the jurisdiction of federal

courts, but it can’t be any wider than what the Constitution says. The two

main cases where a federal court has jurisdiction are (1) those that are

about federal “stuff” like the Constitution or federal laws, or (2) cases that

are between citizens of different states and involve over $75,000 (currently)

up for grabs.



Is the federal court the only court that can hear a case? This introduces the

idea of exclusive versus concurrent jurisdiction. Most things that the federal

government creates causes of action for can be heard in state courts, and

we call this concurrent jurisdiction. An example of exclusive jurisdiction ispatents! On the other hand, an example of concurrent jurisdiction is

trademarks.

Federal subject matter jurisdiction does not replace personal

jurisdiction. You must have both of them. For a federal court to have the

power to enter a binding judgment, it needs personal and subject matter

jurisdiction. Why do you have to have both? They come from different parts

of the Constitution. Subject matter jurisdiction comes from Article III, while

personal jurisdiction stems from Due Process in the Fourteenth

Amendment. Compare Rule 12(b)(1) (subject matter jurisdiction) to Rule

12(b)(2) (personal jurisdiction).

Where does all this subject matter jurisdiction come from? There are three

“tiers” of federal subject matter jurisdiction: The constitutional tier – Article

III provides jurisdiction for the federal courts. This Article enumerates all the

things that the federal courts may (not must ) have jurisdiction over. That is,

just because the Constitution allows the federal courts to have jurisdictioncertain things it doesn’t mean that Congress must allow federal courts to

have jurisdiction over all of those things. The statutory tier – For example,

28 U.S.C. § 1331 gives the federal courts jurisdiction over “federal

questions”. The general idea is that Congress can proscribe some subset of

the federal court jurisdiction that the Constitution provides. The decisional

tier – For example, Mottley interprets the constitutional and statutory

language.

Federal question jurisdiction – § 1331

Louisville & Nashville Railroad v. Mottley – Did the federal district court have

subject matter jurisdiction over the case? A suit arises under the

Constitution and laws of the United States only if the original statement of

the plaintiff’s cause of action shows that it is based on the Constitution or



federal statutes. (In other words, a federal court can’t have jurisdiction just

because the defendant might use a federal law or the Constitution to defend

himself.)

The well-pleaded complaint rule

The well-pleaded complaint rule talks only about the complaint. We look for

a federal question on the face of the complaint. If the federal complaint, as

filed by the plaintiff , does not state the federal question, then there is no

federal question. This is an efficiency rule! You get tons of cases filed every

day in federal court, and we need a good solid rule to be able to tell, from

the outset , whether or not we have jurisdiction.

Why are anticipated defenses not good enough? It’s related to the efficiency

argument. A good lawyer can make a lot of different federal arguments that

the defense could make. But the other side might not make that

argument . In fact, sometimes they will strategically not make that

argument.

Constitutional versus statutory power

The language in the Constitution and in the current federal question

jurisdiction statute is the same. They both say “arising under”. But what theSupreme Court tells us is that this phrases doesn’t mean the same thing in

these two documents! How come?

Under the statute, the federal question must “arise under” a well-pleaded

complaint . You sort of read “well-pleaded complaint” into the statute. This is

what allows the Mottleys’ state case to ultimately be heard on appeal by the

Supreme Court.

Think of two concentric circles. The Mottleys’ case falls under Article III,

which means that the Supreme Court can hear it. However, it does not fall

under 28 U.S.C. § 1331, therefore, the lower federal courts do not have

subject matter jurisdiction. Is this madness? How can we justify the

Supreme Court having power over the Mottleys’ case on appeal from state

court, but not on appeal from federal court?



Congress could provide for original federal jurisdiction over the Mottleys’

claim. We could make the statutory limits coequal to the constitutional

limits. For example, you could add the words “or defense” to the language of

§ 1331.Would that be constitutional? Sure! The Constitution doesn’t haveanything like a “well-pleaded complaint rule”. Congress has basically chosen

not to do this.

The language “arising under” that we find in the Constitution and in the

statute can have different meanings. In particular, we read the “well-pleaded

complaint rule” into the statute. Mottley is an example of federal “arising

under” jurisdiction.

Diversity jurisdiction – § 1332

Why diversity jurisdiction? The courts and Congress have tried to limit

diversity jurisdiction in three different ways. Congress could conceivably do

away with diversity jurisdiction altogether. We keep diversity jurisdiction

around for reasons of tradition as much as anything. Also, litigating in

federal court is desirable, and lawyers like having the option of getting their

cases into federal court through diversity jurisdiction.

Where does diversity jurisdiction come from? First off, from the

Constitution. Then there’s a statute that authorizes that authority to the

federal court. This is 28 U.S.C. § 1332. You need to allege over $75,000 in

damages in order to qualify for diversity jurisdiction. (At the time, it was

$10,000.) The simple matter is that your petition will simply allege that the

matter in controversy is greater than $75,000. Make the defendants argue

against jurisdiction. Your claim will be accepted on its face unless the

complaint plainly contradicts this.

§ 1332 is grounded in the constitutional idea that home state defendants

have some kind of advantage, and so out-of-state plaintiffs would be left at

a disadvantaged if forced to litigate in out-of-state forums. On the other

hand, we don’t let everything go into federal court, because it would be

inefficient. Therefore, we have the “amount-in-controversy” limitation to



screen out unimportant cases. The statute also involves the “complete

diversity” rule, which says we can’t have participants from the same state on

the same side of the “v”.

The rule of complete diversity

No party on one side may be a citizen of the same state as any party on the

other side. The rule of complete diversity is to diversity jurisdiction as the

well-pleaded complaint rule is to federal question jurisdiction. It is a rule that

comes from the interpretation of the relevant federal law (§ 1332) rather

than from the Constitution.

Mas v. Perry – Complete diversity of the parties is required in order for

diversity jurisdiction to exist, meaning that no party on one side may be a

citizen of the same state as any party on the other side. If the amount in

controversy is greater than $75,000, then yes, 28 U.S.C. § 1332(a)(2)

allows diversity jurisdiction over a case where one party is a U.S. citizen and

the other is a foreign citizen. Notice that § 1332(a) tells us that an alien who

has been admitted as a permanent resident is considered a citizen of the

state where they are domiciled.

How do we figure out someone’s citizenship? We determine citizenship bydetermining domicile. Domicile, in turns, means (1) residence plus (2) intent

to remain. Where are you? Do you intend to stay there?

Saadeh v. Farouki – The defendant is a permanent resident of the United

States residing in Maryland but whose citizenship is

Jordanian. Did Farouki qualify as a “citizen of a State” under 28 U.S.C. §

1332(a)? The statute states that at least one of the parties in a dispute must

be a “citizen of a State” in order for the federal courts to have diversity

jurisdiction. Furthermore, the statute says that for the purposes of the

section in question “an alien admitted to the United States for permanent

residence shall be deemed a citizen of the State in which such alien is

domiciled”. The court chooses to liberally interpret the statute because it

feels that a literal reading would cause an undesirable and unintended



result, that is, that federal diversity jurisdiction could exist over a dispute

involving only foreign litigants.

The court uses the legislative history to interpret the amendment to the

statute as a move to narrow federal diversity jurisdiction ratherthan broaden it. The statute apparently was intended to reduce the federal

caseload. The court finds that the statute was intended to eliminate federal

diversity jurisdiction between a United States citizen and a resident alien

living in the same state as that United States citizen.

All the stuff in § 1332 is predicated by the requirement that the amount in

controversy must exceed $75,000. This amount has changed over time to

(somewhat) keep pace with inflation. It started out at $500 and was most

recently raised from $50,000 to $75,000 in 1997. What is the purpose of

increasing the amount in controversy? This will limit the federal caseload.

Injunctions and aggregation

Injunctions don’t ask for a dollar value. How do you assign a dollar value to

determine whether the value is great enough to get you into federal

court? (1) What’s the value of the injunction to the plaintiff? (2) What’s the

cost to the defendant to comply with the injunction? (3) What’s value or costto the party that invoked federal jurisdiction (i.e. the plaintiff filing or the

defendant removing)? Or any of the above!

How can you aggregate plaintiffs’ claims? Can you add up claims to get over

the $75,000 benchmark? It’s confusing, but there are some basic rules that

you can use. (1) Single plaintiffs can aggregate against single defendants. It

doesn’t matter if your various claims are unrelated. (2) Multiple plaintiffs

can’t aggregate unless you come under the exception below. (3) The Rule

of Zahn says that in a diversity class action, every class member must have

a claim in excess of $75,000, unless courts find that § 1367 changes this

rule. (4) If a counterclaim is compulsory, it can be heard regardless of the

amount. If the counterclaim is permissive, it needs to have an independent

jurisdictional basis. If there’s a counterclaim that is permissive rather



than compulsory , that is, one that could be brought separately (e.g. in state

court), then you’d need an “independent basis for jurisdiction”.

Supplemental jurisdiction – § 1367

To this point, we’ve looked at several ways the courts and Congress have

tried to limit the number of cases getting into federal courts. Now, we’re

going to take things that wouldn’t ordinarily be in federal court and see if we

can find a basis for getting them in.

United Mine Workers v. Gibbs – Gibbs had a federal claim and a state tort

claim. He has a “mixed body” of claims, and the Supreme Court lets him

bring them all together in federal court even though constitutionally he

couldn’t bring the state tort claim separately. What is it about this “clump” of

federal and state claims that makes it constitutional for the federal courts to

hear it? Gibbs is a constitutional case. Gibbs says that Article III’s delegation

of federal judicial power relates to cases and controversies rather

than claims.

Brennan says: “The state and federal claims must derive from a common

nucleus of operative fact ” in order to lasso them in using supplemental

jurisdiction. We look at claims and think about whether we would normallyexpect to try them together in the same judicial proceeding. Is it efficient to

try these claims together? Will the jury get confused from using two bodies

of law at once?

28 U.S.C. § 1367 takes the concepts from Gibbs and tries to apply them to

provide for the same kind of supplemental jurisdiction. Stuff that arises from

the same claim or controversy comes into play under § 1367(a).

Finley v. United States – This is what used to be called a “pendant party”

claim. The plaintiffs sue both the FAA and the electric company. The plaintiff

and the power company are non-diverse parties. The Supreme Court said

thatFinley barred pendant party jurisdiction unless there was an independent

basis for it. When Congress drafted § 1367, they tried to undo the result

in Finley and allow that type of claim to go forward. So if a similar case



would come up today, we would look at § 1367 and see that pendant party

jurisdiction is okay under § 1367(a).

But we’ve got problems! 28 U.S.C. § 1367(b) – This is difficult, bad, nasty,

and poorly drafted according to Fairman. What this sub-section tries to do isto protect complete diversity . It takes away supplemental jurisdiction under

certain circumstances. If jurisdiction is founded solely on diversity, then

district courts shall not have supplemental jurisdiction…under certain

circumstances. The statute says, “Let’s bring a case together that’s all one

case based on diversity. On the other hand, let’s take out of that pool those

cases that wouldn’t have subject matter jurisdiction under the rule of

complete diversity.”

Owen Equipment & Erection Co. v. Kroger – In Owen v. Kroger , the Supreme

Court says that the state law negligence claim of Kroger against Owen

cannot go forward in federal court against a non-diverse party. Would §

1367(b) allow this suit to go forward? The statute would deny supplemental

jurisdiction because it is a suit by a plaintiff against a party that is joined

under Rule 14. (The power company joins Owen under Rule 14.) The

drafters create this statute based on claims by a plaintiff, and then they

enumerate specific rules. Thus, they screw up, because they don’t

understand how litigants’ positions may change during litigation.

We talked about the Rule of Zahn in relation to the class action rules. To

have a federal class action, you would have to have every single class

member have more than $75,000 in claims. Does § 1367 change this

result? Yes, because class actions are Rule 23, which isn’t part of the list in §

1367 of kind of joinder-type-stuff to be excluded. This leads many to say

that the Rule of Zahn is now…gone!

28 U.S.C. § 1367(c) – This is probably the most screwed-up procedural

statute. Congress is fine with this statute, but there are unanswered

questions about it and it is controversial.

So the supplement jurisdiction statute is a mess. But Fairman wants us to

know how the statute is supposed to work . § 1367(a)



codifies Gibbs and Finley , and § 1367(b) takes away part of the

supplemental jurisdiction based on diversity. But we won’t need to know the

complicated, nitty-gritty weird stuff that we talked about earlier. They didn’t

intend to revoke the Rule of Zahn, but oops, they did.

What about removed cases? Do they have a place in § 1367(b)? Something

that has been removed is there theoretically based not only on § 1332 (the

diversity jurisdiction statute), but also § 1441 (the removal statute). Some

courts believe this, but some don’t.

The old terminology of supplemental jurisdiction

These concepts are old and have been subsumed by § 1367, but we need to

know the old stuff because there are a lot of old lawyers and judges out

there who only know the old way of doing things. Pendant jurisdiction – If

you have federal question jurisdiction to anchor the case, and you have an

additional state law claim, then, provided that the claims come out of a

“common nucleus of operative fact”, then you can hear them together. This

is essentially the situation in Gibbs. Ancillary jurisdiction – If you have

diversity jurisdiction, will it cover additional claims over other parties? Let’s

say you have a good federal diversity claim, but the defendant makes a

third-party claim against a third-party defendant who is not diverse. Pendant party jurisdiction – If you have federal question jurisdiction, can you make

state law claims against additional parties if the claims come out of a

“common nucleus of operative fact”.

Removal jurisdiction – §§ 1441 and 1446

Removal jurisdiction – the defendant’s forum selection – has a

statutory rubric that embodies a balancing test. In § 1441(a), we let

defendants remove to a federal forum if they could have originally been

brought there. The reason is simple: equity. Yet, we’ll place efficiency

limitations on that: you have 30 days to do it. We also have statutory

controls that say if you have an in-state defendant, that will anchor the

claim and make it non-removable. This is in part a matter of efficiency, but

it’s also equity because a defendant in their home state court shouldn’t



complain about being in their home state because it gives them an

advantage.

28 U.S.C. § 1441 is the main statute for granting removal. Subsection (a)

says the defendant (and only the defendant) can take an action that could have been filed in federal court and put it in federal court. Subsection (b)

tells us that when federal courts have jurisdiction under a federal question,

you don’t have to worry about citizenship. On the other hand , if the federal

basis is diversity , you can’t remove if there is a home state

defendant . Strategically, plaintiffs will try to sue home state defendants to

anchor the case in state court if that’s what you desire.

28 U.S.C. § 1446 gives the procedure for removal. The procedure

is fast . The defendant signs a notice for removal that’s short and sweet. The

“then and now” rule says that you must allege that the amount in

controversy is over $75,000 both “then and now”. The defendant has to file

the notice within 30 days of the filing of the lawsuit. Most of this will be

eaten up by the client’s waffling.

Caterpillar, Inc. v. Lewis – If there isn’t complete diversity between the

parties at the time of removal and the federal courts hear the case anyway,

are their subsequent rulings still good given that there was completediversity of the parties at the time of trial ? Once a case comes to trial in

federal court, general efficiency considerations will trump fairness

considerations in specific cases. You must have jurisdiction at the time the

action is initiated . Allowing this case to go forward violates this fundamental

rule.

The original lawsuit was anchored to state court in two ways: you both had

non-diverse defendants, and a home-state defendant. Is this removal

proper? No. There is Kentucky on both sides of the controversy. This is a

wrongful removal!

What the Supreme Court says (wrongly, according to Fairman), is that once

the case has been tried in district court, you can’t go back due to efficiency

grounds. Caterpillar should not have removed the case; the district court



should not have accepted jurisdiction. However, it is argued that time cures

all ills because by the time of the trial the parties were diverse. The rule is

that you look at the time that the lawsuit is filed.

The Erie Problem

Erie tells us we’ll look at the law of the state for the rules for making basic

decisions in diversity cases in federal court. As Erie evolves into the choice

between “substance” and “procedure”, we get more balancing tests. Under

the Byrd analysis, we have to balance the federal interest against the state

interest. The rubric Byrd provided got us to the Guaranty

Trust question. Hanna allows us to balance countervailing federal

considerations, and even provides a refinement. The courts say: let’s look at

it a different way when we look at federal rules on point. Rather than go

through the traditional analysis, Hanna tells us we must use the FRCP when

we have them and avoid the outcome-determinative test we were initially

given. We look instead at Erie’s twin-aims: that’s a pretty explicit

efficiency/equity balancing test.

In diversity cases, a federal court must apply the law that would be applied

by the courts of the state in which they sit. By “the law”, we mean court

decisions as well as statutes. Most of the time, the Erie issue is not difficult at all . We have a rule: when Congress created the federal court and

empowered them to hear diversity cases, it had to tell them which law to

use in those cases.

The Rules of Decision Act – § 1652

That’s where the Rules of Decision Act (RDA) comes in. It says that federal

courts will use state law to decide diversity cases. The RDA has survived

virtually unchanged to the present day: 28 U.S.C. § 1652. But what does the

statue mean by “the laws of the several states”?

Swift v. Tyson – If you want to look up the law , we might look up statutes as

well as case law. Swift had to figure out what law applied. Justice Story says

that court decisions are not laws. Story said that “laws equal statutes” and



so state statutes will bind federal courts. But if there are no statutes, we will

fill in the gaps with federal common law . Story says that the law is The Law,

and is the same and unchangeable everywhere, an idea grounded in Natural

Law philosophy.

Erie Railroad v. Tompkins – Tompkins sued the railroad in the Southern

District of New York to try to take advantage of the rule of Swift v. Tyson,

which said that federal court didn’t have to use state common law to decide

cases. Can federal courts ignore state law when deciding diversity

cases? Federal courts must follow and apply both state statutes and state

case law in deciding cases unless the case is governed by federal statutes or

the United States Constitution.

Brandeis and the Court attack Swift on several fronts: (1) Swift relied on a

bogus interpretation of the Rules of Decision Act, as proven by Chuck

Warren. (2) Swift has had disastrously unfair results in practice. (3) Swift is

unconstitutional because it usurps part of the power that the Constitution

left to the states to make their own laws (statutes and case law).

Swift , the case, was an unconstitutional result. We don’t typically see the

court go out of its way to declare something they previously did as

unconstitutional, but Brandeis does go out of his way to try to ground Erie inconstitutional analysis.

Brandeis declares that there is no “federal general common law ”. Congress

can’t dictate common law to the states. But arguably, we still do have

federal common law. Congress can easily use legislative tools to change

the substanceof state laws (as in statutes). All they have to do

is coerce states (by withholding funds, for example) to adopt statutes that

Congress prefers.

The Klaxon rule says that the federal court applies the “choice of law” law of

the state in which it sits. This is a variant of Erie. If the court really wanted

uniformity, this is where it screwed up. If there was one set of rules on what

law should be applied, it would give us a much greater sense of

certainty. Recall Piper and its complications.



Erie says that you must apply the “law of the state”. If there’s a statute,

that’s what you apply. If there is no statute, we look at the case law of the

highest court in that state. If there isn’t a definite ruling from the State

Supreme Court, the federal court must make their Erie “guess”: they musttake a stab at predicting what the State Supreme Court would do. There are

two ways to do this: (1) Look at intermediate appellate or state district

courts. (2) Ask the State Supreme Court directly by “certifying a question” of

state law. Most state courts can accept certified questions. (This is rare,

because it is discretionary.)

Guaranty Trust Co. v. York – Can the federal courts hear this suit even

though it would be barred if it took place in state court between non-diverse

parties? NEW RULE, AGAIN! The outcome of the case in federal court should

be the same as it would be in state court. The Court looks to the policy

intent of the ruling in Erie and asserts that it doesn’t matter whether state

law is substantive or procedural as long as it will have an impact on the

outcome of a case.

York gives us the outcome-determinative test. We don’t look at the name

given to the rule by the state to determine whether the rule is substantive or

procedural. We want to ensure the case will come out substantially the samewhether it is tried in federal court or state court. The problem is that this

test goes too far: a lot of crazy little things can be outcome-determinative! If

we apply York literally, then the FRCP will kind of wither and die, because

virtually every rule will run up against a state rule in conflict. Post-York ,

there is confusion among the courts about how to apply or limit the rule.

The eerie Erie three

Ragan v. Merchants Transfer & Warehouse Co. – If we apply the outcome-

determinative test to this case, the outcome will definitely be affected if we

use federal instead of state rules. Do we follow the state rule in this

case?According to York , we must, and that’s what the Supreme Court holds

in Ragan.



Cohen v. Beneficial Indus. Loan Corp. – The federal rule has no bond. The

New Jersey statute says you have to use a bond. Is this outcome-

determinative? Yes! Thus, the Supreme Court holds that New Jersey state

law trumps FRCP Rule 23.1.

Woods v. Interstate Realty Co. – Under Mississippi law, you can’t sue

in Mississippi as a foreign corporation unless you designate an agent for

service of process in Mississippi. Under federal rules, there would be no

problem for aTennessee company to sue in Mississippi without any such

agent. The Supreme Court held that the state statute trumps the FRCP

again!

The Byrd balancing test

It looked like York was swinging the Erie pendulum too far towards using

state statutes, laws, and rules. It’s a Byrd , here to save the day!

Byrd v. Blue Ridge Electric Cooperative – Should the state policy of having

the judge decide a particular issue of fact trump the federal rule of having a

jury decide in the interest of uniformity of outcome? Our new test says that

we will use the federal rule if it’s uncertain whether a different result would

follow from applying the that rule instead of the state rule.

There are three questions that you ask when you deal

with Erie issues: (1) Is the state rule bound up

with rights and obligations? This is the substantive question. In Erie, the

state rule had everything to do with rights and obligations, so the state rule

applied. If the answer is yes, state law applies. If the answer to this first

question is no, however, you ask the second question: (2) Will applying the

state rule dictate the result of the case? This comes out of York . In York , the

answer was yes. If the state rule is outcome-determinative, we must ask a

third question: (3) Are there countervailing federal considerations?

The main advantage of Byrd is that it gives us a chance to consider the

federal forum’s interest in running things a certain way. This case helps us to



preserve the rest of the federal rules and stop the killing off of all

the FRCPs! It stops the erosion of the Eerie Erie Three!

Hanna v. Plumer – When a situation is covered by the Federal Rules, the

REA tells you to use the Federal Rule and the only way you’re goingto not use the Federal Rule is if it is unconstitutional. But the trick is that the

Supreme Court both writes the rules and decides whether they’re

constitutional. Thus Hanna gives us a simple way to preserve the FRCP. If

the Federal Rules are on point, you use them, unless they are

unconstitutional.

The twin aims of Erie are: (1) Stop forum shopping, and (2) avoid unfair

differences in administration of justice between state and federal courts.

The Rules Enabling Act says that the Supreme Court gets to set the rules of

procedure for the federal courts, provided that it does not “enlarge, modify,

or abridge any substantive right”. Congress, by statute, empowered the

court to create the Federal Rules of Civil Procedure. The REA is different

from the RDA. The latter is the law that prescribes the way in which the

federal courts decide the legal questions involved in diversity cases.

Modern Erie

How do we put Erie, York , and Byrd together with Hanna in order to describe

a unified Erie doctrine? Is there a Federal Rule of Civil Procedure at issue? If

no, analyze under the twin aims of Erie. That’s Hanna dicta. If there is a

Federal Rule, then is there a conflict between the proposed Federal Rule and

the state’s procedure? If not, then you use the Federal Rule. Presumably, if

there’s no conflict, you can use the state rule as well. That’s a possible

explanation for Gasperini . If there is a conflict, then you ask: is it within the

REA? If yes, then you apply the Federal Rule. There can’t be a no answer

because a court will never declare one of its own rules unconstitutional.

It turns out that if there is a Federal Rule, there is only one possible

result: use the Federal Rule. Is there a Federal Rule or statute on point? If

yes, then use it. If not, then we’re into the murkier Erie guess. It’s



suggested that we ask theYork question: is the rule outcome-

determinative? If not, then you use the Federal Rule. If yes, you use

the Byrd test which asks if there is an overriding federal interest. If there is

a FRCP or statute, we use Hanna. On the other hand, if there isn’t, we use a

combination of York and Byrd .

Burlington Northern Railroad v. Woods – What’s

the Erie question? The Erie choice is between the Alabama “specific”

rule, or the “discretionary” Federal Rule. The Court rules that the Federal

Rule wins! Is there a Federal Rule on point? Yes, and there’s a conflict, so we

use the Federal Rule.

Stewart Organization, Inc. v. Ricoh – Our Erie conflict is between

the Alabama precedent (common law) and the federal statute (28 U.S.C. §

1404). Federal law allows you to transfer, while the Alabama Supreme Court

has held that forum selection clauses are invalid based on public policy

reasons. The conflict isn’t the forum selection clause itself, but

between Alabama’s common law provision and a federal statute that says

that you can move litigation at the discretion of the court. The Court holds

that we shall follow the federal statute. § 1404(a) wins! The decision about

whether the rule or statute is on point is the real battleground. If you have

any hope of applying a state rule, it must be at the “on point” level.

Walker v. Armco Steel Corp. – Do we apply the Federal Rule? The Court says

that Rule 3 does not affect the statute of limitations, for some reason. The

Court gyrates out of the seemingly clear conclusion from the one-sentence-

long Rule 3. The Court suggests that there is not a federal statute on

point. Once we get there, the opinion makes sense because the twin aims

of Erie really are affected. In one forum, you’ll be able to sue, while in

another forum you can’t.This was part of the trilogy that came after the

outcome-determinative test. The Court was unwilling to let go and reverse

itself. Thus, the Court continues to maintain that Rule 3 is trumped by state

exception statutes.

Gasperini v. Center for Humanities, Inc. – This is all about the conflict

between the good ol’ Seventh Amendment and New York law. New



York state law allowed a review of the jury award by a judge. On the other

hand, the Seventh Amendment says that no fact tried by a jury can be

reexamined by any other court. In this case, Ginsburg says that we can

protect both federal and state interests. The Court rules that the appellate

court cannot apply New Yorklaw (the Second Circuit was in error) but thefederal district court can apply New York law, so it was right.

Choice of law

All courts, state and federal, must make choice of law decisions. The Rule

of Klaxon says that a federal court ordinarily must apply the choice-of-law

rules of the state in which it sits.

Choice of law is another place where we see the balancing test. In deciding

choice of law, the Restatement tells us that the transactional test that most

jurisdictions use is a balancing test that are used to see which jurisdiction

has the closest relationship to the claim. Where did the claim arise? Where

are the parties? We want to make it easy to litigate issues like this, but we

want to make it equitable by ensuring some relationship between the law we

choose and the participants in the event.

There is exception to the rule for cases that are transferred. When a case

gets transferred, you apply the choice-of-law rules of the state from which itwas transferred. (This is called the Van Dursen & Ferens doctrine.) The point

is that a transfer should be no more and no less than a “change of

courthouse”, but it shouldn’t change the law that is used.

Gries v. Modell – Should Ohio law or Delaware law apply to the contract

between Gries and Modell? The corporation is incorporated

under Delaware law, but the team is in Ohio. Arguably, since Delaware law

governs the corporation, Delaware law covers the contracts. However, most

state courts will try to apply their own law at first blush. It’s convenient and

they’re familiar with it. The Ohio Supreme Court agrees with the trial court

that Ohio law should be applied. The Ohio Supreme Court changes the

standard by which Ohio courts decide choice of law issues in contract

cases. The old rule is that the place where the contract is to be performed

governs.



Why use a “place of performance” rule? It’s an easy, black letter rule. Most

contracts have a place of performance, and if you can identify it, you’ll know

which state’s rules apply. Also, if a contract is being performed somewhere,

it makes sense that the law of that place applies.

The new test, which comes out of the Restatement of Conflict of Laws, is

the most significant relationship test. It’s a factor test! Those factors

include: (1) The place of contracting, (2) the place of negotiation of the

contract, (3) the place of performance, (4) the location of the subject matter

of the contract, and (5) the domicile, etc., of the parties. Note that part of

the purpose of the Restatements is to eliminate black line rules and allow

more discretion by considering and weighing multiple factors.

Morgan v. Biro – Does Ohio law or Kentucky law apply to the facts of the

case? NEW RULE! The court abandons the old rule of “lex loci delicti” (“the

law of the place where the tort was committed”) in favor of a balancing test

weighing the following factors: (1) where the injury happened, (2) where the

misdeed that caused the injury happened, (3) where the parties are from,

(4) where the relationship between the parties is, and (5) additional factors

(“section 6”).

Incentives to litigate

So you wanna go to court? Well, you better ask yourself two fundamental

questions: (1) What is the remedy? Are you going to get something for your

client? (2) Where is the financing? How is the litigation going to get paid

for? If there’s nothing “at the end of the rainbow” f or yourself or your client,

you won’t proceed.

There are two types of remedies: specific and substitutionary. Specific

remedies compel someone to do something. Substitionary remedies are all

about money.

United States v. Hatahley – Was the damage award appropriately

calculated? The injured party needs to be put in the position it would have



been in absent the wrong of the injurer. The three important rules of

compensatory damages that we learn from this case are: (1) The open

market value rule (an objective measure), (2) the mitigation principle (you

can’t sit around and pile up losses), and (3) individualized measures of pain

and suffering (you can’t hand out money with a cookie cutter).

Punitive damages

The purpose of punitive damages is to punish, which is not a traditional

element of our civil justice system. Typically, civil lawsuits aren’t about

punishment. Largely we leave punishment to criminal law. There are reasons

why: there are significant differences in the way these cases are handled.

Plaintiffs drive civil legal actions. In criminal cases, the prosecutor runs the

show. The standard of proof is preponderance of the evidence in a civil

case. In criminal cases, the standard of proof is beyond a reasonable doubt

(a higher threshold). That’ s why you can still have civil lawsuits after

criminal acquittals.

Honda Motor Co. v. Oberg – Does the Oregon constitutional prohibition on

judicial review of jury punitive damages awards violate the Fourteenth

Amendment? Procedural laws and rules that undermine common lawprocedural protections are presumed to violate the Due Process Clause.

The Due Process Clause spawns two types of protections. This is the kind

that we would call procedural due process. That means there must be a way

to go about reviewing results. The other half is substantive due process, as

found in BMW .

BMW of North America v. Gore – Was the punitive damage award in the case

unconstitutional excessive? The constitutionality of punitive damages awards

will be judged by: (1) The degree of reprehensibility of the defendant’s

conduct, (2) the disparity between the actual harm done, as found by the

jury, and the punitive damages award, and (3) the difference between the

punitive damage remedy and civil or criminal fines imposed by statute or in

similar cases at trial. The constitutional issue is one of substantive due



process. Due process requires that you have notice that you might be

deprived of your property. You also must have notice of how much you

might be out for.

Cooper Industries v. Leatherman Tool Group, Inc. – This case gets arguednot on Fourteenth Amendment grounds, but on Eighth Amendment

“excessive fine” grounds. Stevens says that states must not impose grossly

excessive punishments under the Eighth Amendment. Also, on review, you

mustn’t assume the trial court got it right. This gives the appellate courts a

different way of checking the amount of damages. Doing it like

this, de novo, will overturn more verdicts than review merely for abuse of

discretion.

State Farm v. Campbell – This case was about failing to settle claims within

policy limits. The United States held the punitive damages award

unconstitutional in this case by substantive due process according

to Gore. Although the Utah Supreme Court applied the three-

prong Gore test, the Supreme Court says that the Utah Supreme Court

applied the test wrong. In this case, the Supreme Court hints at a

number: single-digit punitive damage multipliers are probably okay, but ten

and above will raise the proverbial eyebrow.

Financing litigation

There are all different methods of financing litigation. In practice, this

question becomes increasingly important. How are we going to be paid?

The American rule v. the English rule

Under the American Rule, everybody pays their own lawyer. Under the

English Rule, the loser pays! What incentives do these rules provide to

litigants? There is no incentive to file a totally frivolous lawsuit under the

American rule.What about under the English Rule? Not only is there no

recovery for the frivolous plaintiff, but the plaintiff will also have to pay the

costs of the defendant. Which system is more likely to have a deterrent



effect? The marginal case is dropped in the English system, because it’s not

worth the risk of incurring both your own costs and the defendant’s costs.

Characteristics of the American rule: Both sides are undercompensated,

insofar as winning plaintiffs must pay part of their compensation to thelawyer. If the defendant wins and has to pay zero to the plaintiff, they still

have to bear their part of the cost of litigation. This system is hospitable to

“marginal cases”. This system has the problem of creating financing

difficulties for marginal plaintiffs with low potential for recovery.

Insurance

How do you defend yourself when you gets sued for a car accident? You

start out by calling your insurance company. Why? Because car insurance

usually has coverage for legal representation when you get sued. So who

becomes one of the parties in interest? The insurance company takes an

interest in the outcome of the suit. Insurance companies bear a lot of

litigation costs and therefore want to settle even frivolous claims.

Contingency fees

The lawyer agrees to provide legal services with fees to be paid out of apercentage of the proceeds of the litigation. This is the chief way that

plaintiffs are able to finance meritorious litigation. That’s because the costs

per hour for attorney’s fees are simply too great for most individuals to bear

except in certain contexts.

Yeazell describes contingency fees as being like insurance policies for

potential plaintiffs. A system with a combination of contingency fees and

insurance basically provides a way that most people can get representation

on both sides in most litigation.

Legal aid and pro bono

There are agencies at all levels of government that provide legal assistance

to indigent plaintiffs. Pro bono work is free work that regular old lawyers



would do for indigent plaintiffs. The ABA suggests you do 50 hours of pro

bono work a year.

The bottom line is that there are many ways to finance. These are all parts

of the American Rule.

We talked about contingency fees. We also talked about hourly fees. That’s

how a lot of corporate work is done. Some basic work is done by flat fee, like

divorce, petty crime, wills, and stuff like that. Some legal work is done pro

bono. Insurance is also a source of funding.

Fee shifting – Rule 54

The American Rule says that everyone pays for their own lawyers. However,

we have some elements of fee shifting (like the English Rule) embedding in

our fee structure. The clearest example is in civil rights litigation. 42 U.S.C.

§ 1988(b) says that the court may allow the prevailing party in a civil rights

suit to get the opposing party’s attorney’s fees. The Supreme Court has

interpreted “the prevailing party” to mean “the prevailing plaintiff”.

Why would Congress create a statute like this? Maybe Congress is trying to

create incentives. Congress favors civil rights and favors civil rights litigationas a way to achieve civil rights. Therefore, they’ll give you extra incentive to

bring these kinds of lawsuits. Congress also wants to “pile on” the

defendant. Remember that fees are not the same thing as costs!

FRCP Rule 54(d) says that generally you’ll get costs other than fees if you

win (whether you’re the plaintiff or the defendant). You would never bother

filing a motion for costs because the costs they’ll let you recover are so

minimal.

Evans v. Jeff D. – Do federal district courts have the power to approve the

waiver of attorney’s fees? Rule 23(e) requires court approval of settlements

of class actions. The Fees Act doesn’t prohibit all settlements conditioned on

the waiver of fees. If this had been a Rule 68 offer, the class still would have

received their fees up to the offer. Rule 68 just blocks the fees earned after



the date of the offer. On the other hand, this offer is intended to avoid trial

altogether by making an attractive settlement offer.

Rule 68 and other fee shifting statutes

FRCP Rule 68 allows defendants to cap their liability for certain costs by

making a settlement offer before trial.

In an ordinary piece of federal litigation, the defendant makes a good faith

offer of judgment. If the plaintiff accepts, that’s the end of the case. If not,

the case goes on to judgment. There are two possible results: the plaintiff

gets more than the offer and recovers costs. If the plaintiff gets less than

the offer, the plaintiff gets their costs up to the point of the offer, but not

any of their costs after that offer. In fact, the plaintiff has to pay the

defendant’s costs from that point on. The idea is that I should have taken

the offer when I should have because ex ante it appears that it was

reasonable. This doesn’t usually have a big impact, but it could if we’re

dealing with a fee shifting statute like 42 U.S.C. § 1988(b) under which fees

are defined as costs. The defendant, by making an offer, can avoid paying

the plaintiff’s attorney’s fees after the offer.

Provisional remedies – Rule 65

What if something real bad is going to happen RIGHT AWAY??? We

need preliminary relief !!! The idea is to preserve the status quo and prevent

future bad acts. One place you’ll find such relief is in FRCP Rule 65(b), where

you’ll find temporary restraining orders. These can happen without

notice! You demonstrate facts by affidavit that there will

be immediate and irreparable injury and that you certify to the court that

you’ve done your best to give notice to the other side. If you’re worried that

somebody is going to try to get a temporary restraining order against you,

you should let everyone in your office know about this.

On the other hand, in Rule 65(a), you find preliminary injunctions, for which

you need to have a hearing first. You’re going to order someone not to do

something following a hearing. Temporary restraining orders and preliminary

injunctions can be reversed for lack of specificity.



There are several types of injunctive relief: (1) Ex parte temporary

restraining order (no prior hearing, and it’s of a short duration), (2) a

regular temporary restraining order (pending a hearing), (3) a preliminary

injunction (after hearing but before trial), or (4) final injunctive relief (aftertrial).

Provisional remedies are explained in Fuentes! In resolving what sort of

process is due to Ms. Fuentes, we must balance efficiency and equity. There

must be notice and a hearing, but the type of notice and hearing can vary

based on the reason rights are being deprived.

Fuentes v. Shevin – Does procedural due process require the chance for a

hearing before the state takes someone’s stuff? The state can only take stuff

without a hearing when: (1) The seizure is directly necessary to protect an

important public interest. (2) There is a special need for prompt action. (3)

The state keeps strict control of the seizure process by having a government

official make sure the seizure is necessary and justified.

Fuentes was entitled to a prior hearing. It doesn’t matter if she gets a

hearing later. Why not? You must have notice and be heard before the

government comes and takes your property away. You’re entitled to beheard. That’s how the Court interprets the Fourteenth Amendment.

Procedural due process

Before the government can take your stuff, you must have notice, and you

must have a hearing of some sort. That’s procedural due process. You can

choose not to take advantage of that right if you want. The purpose of all of

this is that we want to make sure that we don’t wrongfully take Fuentes’s

property. Even short-term deprivation of Fuentes’s property is bad.

Not every pre-hearing seizure requires notice plus a hearing. What are the

exceptions? (1) There must be an important governmental or general public

interest, (2) there must be a special need for prompt action, and (3) it must



beinitiated by the government itself. This is sort of a factor test and not

necessarily a three-prong test.

You can look at Fuentes two ways: “Fuentes small” and

“Fuentes grande”. “Fuentes small” says that pre-judgment seizure of adebtor’s property without notice and the opportunity for a hearing is

unconstitutional. As a result of this, states must change their statutes to

provide for hearings before people are deprived of their

property. “Fuentes grande” says that notice and a hearing are the bedrock of

due process. It’s another balancing test! It’s a balance between what’s

efficient (the replevin process) and what’s fair (having some way to judge

whether the procedure could be in error). The Court sides with fairness in

this case.

Filing a complaint – Rules 8 and 11

Once you decide to litigate, you choose a forum. This involves personal

jurisdiction, subject matter jurisdiction, venue, Erie, and choice of law. Okay,

we’ve got the right court and the right law, so now we’re going to file a

complaint, which involves Rules 8 and 11.

We looked at the Federal Rules of Civil Procedure themselves, such as Rule11, which requires me as an attorney to sign papers that are filed with the

court. On the other hand, Rule 8 says we shall use notice pleading, which

means we don’t need to put all the info into the initial pleading. Fairman

argues that Rules 8 and 11 are in conflict…and it’s just that same conflict

between efficiency and equity. Rule 11 requires you to do more than Rule 8

requires you to do in your complaint, which may lead to conflicts.

Bridges v. Diesel Service, Inc. – Should the plaintiff be sanctioned for a Rule

11 violation? What Rule 11(b) says is that you have an obligation, as an

attorney, to sign every piece of paper that’s ultimately filed in the court, like

pleadings and motions. By signing the stuff, you are certifying that what you

say in that document has been formed after a reasonable inquiry, that it’s

not being used for improper purposes (harassment or delay), and that your

claims are warranted by existing law or a good-faith effort to change the



law. You are promising that you’ve done your research and you have a

good-faith basis to make the motion you’re making.

Pleading – Rules 8 and 9

Under the federal rules, the pleading is governed by Rule 8. You have to

provide “a short and plain statement of the claim showing that the pleader is

entitled to relief”. This is notice pleading. All you have to do is put the other

party on notice of the accident such that they can form a response to the

complaint. The plaintiffs don’t have to explain their legal theory.

There are exceptions: Rule 9(b) says that in cases of fraud or mistake,

claims will be stated with “particularity”. That’s heightened pleading! It’s the

bane of Fairman’s existence!

Bell v. Novick Transfer Co. – Is it necessary for the plaintiff to lay out the

facts and allegations in detail in his complaint? Rule 8 only requires only

“notice pleading”, which is just a brief statement that shows the plaintiff can

get relief.

What is the relationship between Rule 8 and Rule 11? Rule 8 tells us that

your complaint need only have “bare allegations”, while Rule 11 requires youto have investigated and have evidentiary support for your factual

allegations.From the plaintiff’s standpoint, when I sign a complaint, I’m

supposed to have done all the investigation necessary to support my

complaint. But I don’t need to put that research into my complaint! There

might thus be a tendency on the part of the plaintiff to cut corners and

ultimately violate Rule 11. The rules are in tension with each other!

Wright called Rule 8 “the keystone”. It’s easy to sue people: you give them

notice. Everything else in procedure is designed to “winnow down the issues”

to just those things that will be tried on the merits. You join up people, you

“discover” which claims have merits, and then you go to trial or settle or get

summary judgment. There is an exception, though, in Rule 9(b) where there

are particularity requirements for fraud. This rule basically got in by

tradition!Fairman thinks it should be abolished!



Leatherman calls this conflict in this question. The Fifth Circuit decided that

civil rights cases are “fraud-like”. They are easy to allege, difficult to defend,

expensive, and difficult to get out of. The Circuit decided that civil rights

cases should be treated differently. The Supreme Court finds that the rulesdo not include heightened pleading for civil rights cases, and so they strike

down the Fifth Circuit decision. Post-Leatherman, fraud cases require

heightened pleading, while civil rights cases only require notice pleading.

However, amazingly, various circuits continued to apply heightened pleading

to civil rights cases. The thing is that there was a little footnote

in Leatherman: they left the door open to requiring heightened pleading

against individual government actors. In this little “crack”, many circuits, led

by the Fifth, interpreted this to mean that notice pleading is only required for

suits against cities.

Swierkiewicz , out of the Second Circuit, required heightened

pleading again. The Supreme Court overruled this, and Justice Thomas said

that Rule 8 applies to all civil actions except for those with fraud or

mistake. You would hope that this case will get rid of heightened pleading

except for fraud. If only that were the case, says Fairman! In practice,

courts impose factual particularity in a whole host of cases like RICO,antitrust, CERCLA, conspiracy, defamation, copyright and even negligence

claims. Even heightened pleading is undefined! It has various meanings to

different courts. The issue seems to be whether you should use heightened

pleading for anything that’s “fraud-like” or only when there’s something

that’s exactly fraud, nothing more and nothing less. The major motivation

for heightened pleading is probably the deterrence of frivolous lawsuits, but

Fairman says that this is an overreach of judicial power.

Rule 12

Rule 12(a) says there is an answer deadline. You have to answer a

complaint 20 days after you’ve been served. That’s not a lot of time,

because after your client has been served, they go around looking for a

lawyer, and by the time they get to you, you might have far less than 20



days to do your answer. But you have another option: if you waive service

under Rule 4(d), you get 60 days after the request of the waiver. As a

practical matter, most people waive service because that’s a big boon. These

are rules for repeat players in the litigation game. So 12(a) just tells

us when.

12(b) says there’s a lot of stuff you can present, stuff you can include in

your answer. All Rule 12(b) says is: bring it on! Let’s get everybody in and

on the table before we get started. The process is designed to get you into

court quickly and cheaply, and then we’ll work it out later.

When you file an action against somebody, that’s a claim. What if that

person wants to sue you back? That’s the counterclaim. What if I want to

sue against two different people? I can have a claim against them, they can

have a claim against me, but they might have claims against each

other . These are cross-claims. In other words, these are claims between

people on the same side of the “v.”: plaintiff v. plaintiff, or defendant v.

defendant. Let’s say the defendant wants to bring in their insurance

company. This would be a third-party claim.

Rule 12(b) motions

All 12(b) motions are potential pre-trial motions to dismiss a case without it

having to go to trial: (1) subject matter jurisdiction, (2) personal

jurisdiction, (3) improper venue, (4) insufficiency of process, (5)

insufficiency of service of process, (6) failure to state a claim, and (7) failure

to join a party. Rule 12(g) and (h) establish which of these get waived if you

fail to bring it at the earliest possible time. Use them or lose them! If you

wrote on an exam that this claim would be waived according to Rule 12(h),

you would be wrong. It gets waived under Rule 12(g).

Rule 12(h) tells us three things: (1) You’ve waived personal jurisdiction,

venue, insufficiency of process, and insufficiency of service of process if you

didn’t do these right off. (2) But we protect a 12(b)(6), failure to state a

claim, as well as Rule 19, which can be raised all the way up to the time of

trial. (3) But subject matter jurisdiction can be raised at any time, even by



the court itself without any action from the parties. Subject matter

jurisdiction is the most favored defense.

At some point, the court wants to go ahead and go forward with a matter

even though there may be problems with certain issues like personal jurisdiction. Why would the court do this? This is the equity/efficiency

tradeoff. For efficiency reasons, if you wait too long, we’re just going to say

you’ve waived your right to have your motion heard.

Answering a complaint

If you don’t file a Rule 12 motion, then your obligation is to file an

answer. You don’t have to answer until a Rule 12 motion is ruled on, which

is one good reason to always file a Rule 12 motion even if it’s mostly bogus.

Answers contain denials, affirmative defenses, and counterclaims. What are

the requirements of those? Denials are described by Rule 8(b). You need to

admit or deny, or if you don’t have enough information to admit or deny,

you say so and that operates as a denial. When you intend to only deny part

of the allegations, you have to say that. If you fail to deny an allegation in

your answer, it’s admitted. If you don’t say anything about a certain

allegation, it’s like you’re saying it’s true. You must include any affirmativedefenses you may have in your answer. You would also include statute of

limitations stuff: “Yes, I messed up, but you waited too long to file,

sorry.” The last part of the answer is any claims you may have

(counterclaims).

Joinder – Rules 19 and 20

This is where we join up all the parties who have a potential role in the

litigation. Rule 19 tells us that some people have to join. Rule 20 tells us

that joinder is permissible in that any plaintiff can join if they assert any

right to relief arising from the same claim. Rule 20 is not very

interesting. It’s usually easy to see the relationship between the transactions

or occurrences. Rule 20 is an efficiency rule: let’s bring in everyone we

can. Rule 19 says: bring them in if they’re necessary. However, it tempers



this impulse with efficiency, asking: “Are those parties really

necessary?” Defendants may be joined under basically the same

standard. It’s basically reciprocal. This reflects a liberal idea of getting as

many people into the lawsuit as needed. The rules are liberal, but there is an

outer boundary beyond which you can’t join up parties.

Temple v. Synthes Corp. – Are joint tortfeasors indispensable parties under

Rule 19(b)? It is not necessary for all joint tortfeasors to be named as

defendants in the same suit. The Court finds that joint tortfeasors are

permissive rather than indispensable parties. Multiple tortfeasors equals

permissive joinder. This is a black-letter rule. The gist of the Supreme

Court’s ruling in Temple is that the lower court went past the threshold

question in Rule 19(a) too soon and skipped right to the balancing test of

19(b).

Discovery

This is simply the methods used by a party or potential party in a lawsuit to

obtain or preserve information. These are the tools we have to find out stuff

or keep stuff from being destroyed.

The purposes of discovery are: (1) Preservation of information that mightnot be available at trial. You record it through depositions, interrogatories,

and other stuff. (2) Winnowing down the issues in controversy. We want to

start narrowing things down. Some of the issues alleged in the pleadings

might not be supportable at trial and you might choose to drop a claim. Or,

as a defendant, you might find that you’re going to be liable and so you’ll

settle. (3) Obtain information that will lead to admissible evidence. But you

can discover lots and lots of stuff that will not be admissible.

Discovery comes in the form of: (1) Requests for production, (2) disclosures,

(3) depositions, (4) interrogatories, (5) requests for admissions, and (6)

mental or physical exams. These are the six main tools of discovery.

All of these tools are subject to other general discovery rules, like Rule 37:

what do you do if you don’t cooperate? This is a sanction rule. For non-



compliance with any of the discovery rule, you can get sanctions, such

as: (1) Facts are deemed admitted. (2) Evidence is prohibited. (3) Pleadings

get stricken or a dispositive ruling is made. (4) Contempt! (5) Attorney’s

fees and expenses are awarded.

Butler v. Rigby – Discovery includes not only information admissible at trial,

but also inadmissible information that could lead to other information

that would be admissible at trial. Discovery can be flexibly limited by

considerations of both efficiency and fairness at the discretion of the trial

judge. You can get information both from parties and non-parties. Rule

26(b)(1) tells you what kind of stuff is obtainable in discovery. You can even

request stuff that may be ultimately inadmissible at trial. We don’t make

evidentiary determinations at the pretrial stage.

Summary judgment – Rule 56

When we take a case away from a jury, we are affecting the equity interests

of the parties that are litigating. We do that when there’s nothing to actually

be tried because it’s more efficient . Based on the Celotex standard, we may

deny you your day in court in the name of efficiency. The Celotex standard

says that summary judgment should be entered after discovery against a

party who “fails to make a showing sufficient to establish the existence of anelement essential to that party’s case”. Summary judgment is a way in

which cases are resolved on the papers. It’s like a motion to dismiss. When a

court enters summary judgment, it’s all over. It’s like there was judgment at

a trial. Your only recourse is an appeal.

Houchens v. American Home Assurance Co. – Summary judgment shall be

granted after discovery against a party that fails to show they could

establish some essential element of their case which they have the burden

to prove at trial.Either side can seek summary judgment, but it’s typically a

defendant’s type of motion. It’s not limited to that, though. Summary

judgment is a procedural mechanism to get a final, binding determination on

the merits such that the moving party wins. Implicit in that is that there is

no need to go to trial: there is nothing to try in this case because the court

has everything it needs to make its decision as a matter of law .



The standards for summary judgment come from Rule 56. The standard is

that there is no genuine issue of material fact . If there is an issue of fact, the

summary judgment must be denied because the factfinder gets to resolve

that factual dispute. Summary judgment says that there’s nothing to trialbecause all the facts are clear and if we accept those facts they do not

amount to a recoverable claim.

The Supreme Court has elaborated on the standard in Celotex . They said

you can get summary judgment if, “after adequate time for discovery”, the

losing party “fails to make a showing sufficient to establish the existence of

an element essential to that party’s case, and on which that party will bear

the burden of proof at trial”.

What kind of evidence does the court consider on summary judgment? They

can look at the requests for production of documents. Those documents

form evidence that you can use at this stage. The depositions will create

transcripts that you can use as evidence at this stage. You can also use

interrogatories and requests for admissions. Most importantly, affidavits

are very important. At minimum, you as the attorney will have to write an

affidavit that the copies you submitted as evidence were “true and correct”

copies of the documents given to you.

Judgment notwithstanding the verdict – Rule 50

Norton v. Snapper Power Equipment – A court should grant judgment

notwithstanding the verdict for the moving party only when it finds that,

having taken the evidence as most favorable to the non-moving party,

reasonable people could not possibly find for the non-moving party. Directed

verdict/J.N.O.V. is now called judgment as a matter of law . Check out Rule

50! If, considering the evidence in the light most favorable to the non-

moving party, a reasonable jury could not reach a contrary verdict then the

court may grant judgment as a matter of law. This is a conflict between the

judge and the jury. The judge basically says, “Jury! You’re crazy! You

couldn’t possibly make that decision!I’m taking it out of your hands.”



JNOV and summary judgment both view the evidence in the light most

favorable to the non-moving party. The key similarity is that both take cases

out of the hands of the jury. When you look at the standard they use: “no

genuine issue as to any material f act” from Rule 56 versus “no legally

sufficient evidentiary basis” from Rule 50…Fairman says we can think of these two standards as the same.

Preclusion

Preclusion prevents two bites at the apple. Preclusion tries to say that

certain things are done with, they’re final , and we’re not going to go back

and revisit those issues. The preclusion doctrine is justified by weighing our

big factors of efficiency and equity. We avoid inefficient extra litigation, and

we also avoid unfairness to defendants in making them defend too damn

many lawsuits.

Claim preclusion is also known as “res judicata” and issue preclusion is also

known as “collateral estoppel”. We will call all this stuff preclusion. But some

courts will say res judicata, which will sometimes mean claim preclusion in

particular, but may mean preclusion in general.

Claim preclusion forbids a party from relitigating a claim that should havebeen raised in former litigation. If a claim comes out of the same “nucleus of

operative facts”, for efficiency reasons, we want people to bring all the

claims at one time.

Issue preclusion is when an issue of fact or law is actually litigated and

determined by a valid judgment such that the determination is conclusive in

a subsequent action between the parties, whether on the same or different

claims.Same deal: why waste our resources finding out the answer to a

question again when the question has already been answered?

Rush v. City of Maple Heights – Should a plaintiff be allowed to bring

separate causes of action for the same tort? When a person suffers both

personal injuries and property damage stemming from the same tort, only



one cause of action arises. Both sides are asking for preclusion, but they’re

asking for different types…all in the same case!

Claim preclusion

Claim preclusion looks at whole claims as opposed to issue preclusion whichlooks at portions of a claim where issues of law or fact have already been

determined; those issues are then binding on the parties in future litigation.

Frier v. City of Vandalia – Frier sued for replevin in state court and lost. Then

he tried to sue in federal court invoking the Fourteenth

Amendment. Is Frier’s federal claim precluded by the resolution of his state

claim? One suit precludes a second when the parties are identical and the

evidence necessary to sustain a second verdict would sustain the first. The

appellate court says that Frier already had a full and fair opportunity to

litigate all the important issues.Easterbrook says: the federal claim is

precluded because it rests on the same evidence as the already decided

case!

The policy behind claim preclusion

What policy can justify barring the “relitigation” of a claim that was never

actually litigated? The plaintiff is the master of his own complaint. He couldhave brought his claims all together if he wanted, but he didn’t. It’s all about

efficiency!!! On the other hand, if you can’t bring all your claims together,

you shouldn’t be penalized for not doing it.

Martino v. McDonald’s System, Inc. – Does the prior consent judgment

against Martino preclude him from the current suit? Once a judgment has

been rendered on a claim, all possible issues related to that claim are

considered settled even if they weren’t brought up in the first suit. The court

says that a judgment on the merits is an absolute bar to relitigation. A

court-ordered consent decree is a judgment on the merits.

The doctrine of privity

This doctrine says we’ll bar certain people from filing more lawsuits even

though they weren’t actually parties to the previous suit. Basically, privity is



the idea of a relationship between parties such that there is an identity of

legal interests: like property owners and successive owners are

in privity with one another. Trustees and beneficiaries can stand in the same

relationship, as well as executors and heirs. There is an identity of legal

interests between the claimant and the person found to be in privity. To putit another way, there must be a strong legal relationship to bind someone

to somebody’s else’s judgment.

Searle Brothers v. Searle – Should the Searle Brothers be bound by the final

judgment of the divorce case as a matter of either issue preclusion or claim

preclusion? Just because you could have been a party to a prior action but

failed to get involved doesn’t bar you from litigating your own claim. But if

you were in privity to a party to the first suit, you might be barred

from relitigating the claim because your privity partner has done it for you.

Issue preclusion

What’ s the issue of issue preclusion? There are two parts to an issue. An

issue consists of (1) the legal and factual proposition (like negligence,

breach, theft, etc.) and (2) the procedural setting, including burdens of proof

and access to information. That second prong is often overlooked. If the

procedural setting doesn’t provide similar sorts of protections, then issuepreclusion, in general, won’t apply even if it’s an identical factual situation

being litigated.

Illinois Central Gulf Railroad v. Parks – The Parks sued the railroad for

personal injuries to Bertha and loss of consortium to Jessie. Then Jessie

sued separately for personal injuries. Is Jessie’s claim precluded? Are any

particular issues precluded? Claim preclusion precludes the relitigation of a

cause of action for which there has been a final judgment. However, issue

preclusion applies if the causes of action are not the same but some of the

issues raised in the second suit were “actually litigated and determined” in

the first suit.



In issue preclusion, one of the main things you have to be able to discern is

what has actually been litigated . If you don’t know what has actually been

litigated , you don’t know just exactly what has been precluded.



11/30/2011 12:44:00 PM



11/30/2011 12:44:00 PM

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