Professor Lecture 11/19/12 10:22 AM

8/21/11 – pgs. 1-12

An Overview of Civil Procedure

The Idea and Practice of CivPro: Locating Procedure

Civil procedure includes many different things – how we define truth

and justice, lawyers’ relationships with their clients/ profession/

courts, and ultimately varying human characteristics such as greed,

oppression, and venality

Substantive law: the rules governing behavior in everyday life

o This deals with property, criminal law, torts, and contracts (or

obligations)

o However, the procedure of the law is something only for the

insiders AND this carries great importance to those in the

legal profession

Litigation: the process of carrying out a lawsuit

o Procedure includes everything from the etiquette of battle – it

starts with defining the initiation, then moves to development,

and ends finally with the conclusion of the case

o Lawyers deal with pleading, forum selection, joinder,

remedies, and discovery in procedure

We take procedure so seriously because it captures our ideas about

the acceptable forms of settling a dispute – it mirrors our most basic

notions of fairness and the meaning of justice

o It captures the rules of how we do everything plus our reasons

behind those actions

o We use procedure because we don’t want to leave things up

to chance – a dispute should be decided after looking at all

the different factors it involves

o Adjudication – the process of deciding a dispute, or the

judgment handed down

The Text Hypo on page 2 shows procedural issues lawyers

encounter through to development of a case

Clients, Lawyers, Procedure, and Strategy

Once a client has a lawyer, there are two major consequences: the

lawyer and client will have to split up responsibilities, AND the legal

system will have to decide how to deal with issues that arise from

this division of responsibilities

o First, the major decisions about the goals of litigation rely on

the client

A lawyer can be disbarred for filing a suit, settling a

case, or declining a settlement without consulting his/he

client

However, the lawyer deals with tactics: what court to

sue in, whether to request a jury trial, etc. The lawyer

must have a good grounding procedure

When a case comes around, two jobs arise for the

lawyer:

What principle of law determined who prevailed in

this situation?

Which lawyer for which side picked this particular

fight and why? AKA what tactical advantage was

he/ she hoping for?

The legal system treats the lawyer’s choices as if they were the

client’s choices (lawyer is only the agent acting for the client)

o Look at the example on pages 2-6

o While working on a case for a client, it is very important to

take all the right steps to insure that your client will have the

best chance to win his/her case

Where can the suit be brought?

Once the client has chosen his/her lawyer, then the lawyer will start

making decisions that may have consequences: the first decision to

make is where to bring the suit

o The lawyer must first decide if he/she has options for where to

bring the suit based on advantages

Deciding where to file a suit will often force the other side because

they will decide not to pursue the lawsuit – they will settle instead

The lawyer will choose the court based on preference of location –

o If you live in Louisiana, it would be cheaper and more

convenient to bring the case to an LA court than somewhere

in Texas

o Also, you may know judges in Louisiana and the juries may be

more sympathetic to your client because of personal history

or ties to that community

o Also, you may be trying to avoid certain judges because you

may know they are unsympathetic or ill-tempered

o The lawyer will also need to choose between federal or state

court:

Federal judges are appointed for life, whereas state

judges are elected – state court may be best when the

suit applies political pressure to the judge

Also, federal court is larger so juries will have more

people being pulled from different areas

Also federal court tends to have smaller dockets of

cases waiting to hear trial, so it would go on for a

shorter time than a state court

o Second, the lawyer will need to know where she actually can

bring the suit, which deals with three different elements:

personal jurisdiction, subject matter jurisdiction, and venue

Personal jurisdiction: this deals with part of the

constitution that says no one can “deprive any person

of life, liberty, or property, without due process of law”

The courts cannot exercise power over Dodge

unless the state in which the court sits has some

connection to him or to the reason the suit is

being filed

The Supreme Court wrote this out for all courts to

follow – it focuses on the rights of the defendant,

not the plaintiff

Subject matter jurisdiction: most courts are specialized to hear only

certain kinds of cases, but every state has a court that has

generalized jurisdiction (they can hear any case)

o These courts are normally called Circuit Courts, but they are

also called district courts, superior courts, court of common

pleas, etc.

o All federal courts have limited jurisdiction, and Congress

decided which courts can hear what kind of cases

o The cases tried in federal courts either 1) because the nature

of the claim resides under the Constitution, treatises, or laws

of the US or 2) because of the citizenship of the party involved

o Venue: the place of the trialq11

Service of Process: once you have found which court to bring the

suit to, you must start to notify the defendant of the suit

o First you would draft a complaint, which you would keep

copies of for you and your client, one to go to the defendant,

and the last to go to the court

o There are two ways to inform a defendant in a case about the

suit: 1) to mail a copy of the complaint that they must sign OR

2) if the defendant refuses to sign it, then you will have to go

down to the clerk of court to hand in a summons

o The summons and complaint will need to be signed and

sealed by the clerk of court, and then it will be delivered to

the defendant by either a private process server or a Federal

Marshall

Motion to dismiss: parties can file a motion to dismiss a case

because of two things

o A facial attack of the sufficiency of the complaint’s allegations

as to subject matter jurisdiction; OR

o A challenge to the actual facts upon which subject matter

jurisdiction is based

Exercise on page 9

1. They aren’t asking that question because the defense only wants to

dismiss the case instead of letting it go on before a court

2. A) It wasn’t enough because he was not “living” in Missouri at the time of

his death nor for about a year before he died. He did not make any real

plans to return to Missouri and establish a residence there with his wife. B) If

they had signed a lease in Missouri, the intent to move somewhere else

would have been established thus proving that he was going to be domiciled

in Missouri.

3. A/ B) I think it means that they have to find more evidence before they

can bring the case back into court again (as long as it was dismissed without

prejudice from the court?).

4. A) she wanted to get the case dismissed because going through a trial

would have accrued a lot of money and time and digging into her personal

history, so to cut all of those things out was why they filed to dismiss it. B)

5. A) The lawyers probably had to file motions and give something to the

court that explained all the background to the case – or they heard

testimony from people? You would contact the family of the deceased, get

records from people that lived in both areas, and gather as much factual

evidence from people and bills that you could. B)

6. A) I think you would have to discuss when to file the motion with your

client and the laws because of statutes of time limits. B)

When thinking about civil procedure, think about playing a game

First, you need to know the rules of the game

Second, you should know your opponents AND

Third, you should know your objectives of the game

When the game ends or your case is decided, then you will receive your

verdict

As a society, we want our cases to show us truth and justice in a fair

way – the correct person will win the case

However, when you are waiting for your verdict, you will want to win

– lawyers do pursue cases simply wanting to win

o However, the rules are set up to give us truth and justice

ultimately at the end

A lawsuit is a gamble

The Constitutional side of Civil Procedure

Jurisdiction – the power and authority of a court

o Personal jurisdiction – the power of a court over an individual

o Subject matter jurisdiction – the power and authority of a

court to hear this certain type of case

This also deals with general jurisdiction and limited

jurisdiction

Federal court has limited jurisdiction, whereas states

have general jurisdiction

o The federal government can only hear cases that deal with a

federal question – either federal law or the constitution – OR

party’s citizenship

A dispute between people of two different states and

the case must deal with more than $75,000

o Erie – what law does the federal court apply in a diversity case

dealing with parties of different citizenship

The Details of a Case

Incentives to Litigate and Pleading will end the semester

How to prepare for class

Read and brief all cases

Study all the rules that come up with cases – answer the notes and

problems that follow each hypo

Outline at the end of every section

The Principle behind Personal Jurisdiction

Think back to when you were a kid… you and your friend got into

trouble – you will not be disciplined by your friend’s parents

because they aren’t your parent

Basically, if a court doesn’t have power and authority over a party,

then that court cannot punish that person

o They will normally file a motion to dismiss the case because

the court does not have PJ over them

Even if you don’t live in a certain place, you can still be sued

somewhere because of different things:

o You go on vacation somewhere and commit a crime

o You own property somewhere else even though you don’t live

on that property

o The internet because of things you wrote about the other

place

Hawkins v. Masters Farms ,Inc.

--Facts

Creal was killed while his automobile was struck by a tractor owned

by Defendant just south of Troy, Kansas. At the time of his death,

Mr. Creal was living in Troy, Kansas. His death certificate lists

Kansas as his residence.

Until his death, Creal retained certain connections with the State of

Missouri. He applied for a Missouri title and license for his van/ he

applied for Missouri automobile insurance/ he renewed his Missouri

driver’s license, etc.

Plaintiff, the executor of Creal’s estate, brought an action against

Defendant in Federal district court, alleging diversity jurisdiction.

o Defendant disputed that there was complete diversity

between the parties, and moved to dismiss.

--Issue = What constitutes sufficient diversity of jurisdiction for bringing an

action in Federal court based on diversity jurisdiction?

--Holding = (D)’s motion to dismiss is granted

--Reasoning

A person’s domicile is taken from the person’s physical presence in

a state coupled with an intention to remain there. A court reviewing

a facial challenge must accept the plaintiff’s factual allegations

regarding jurisdiction as true.

As the party seeking to invoke Federal jurisdiction, Plaintiffs bear

the burden of proving that jurisdiction is proper.

For purposes of determining whether diversity jurisdiction exists, a

person is a “citizen” of the state in which he or she is “domiciled.”

For adults, domicile is established by physical presence in a place in

connection with a certain state of mind concerning one’s intent to

remain there.

--Significance

In holding Kansas as Creal’s domicile, the court focused on his

apparent intention to remain there. Specifically the Court referred

to the fact that Mr. Creal had had moved his clothes, some

furniture, pictures, photo albums, and other memorabilia into the

home he shared with Mrs. Creal and her children; he contributed to

household costs; and he purchased a new bedroom set with his wife

8/23/11 – pgs. 15-33

Stating the Case: The Lawyer’s responsibility

A complaint asks the court to use its power to grant plaintiff relief

The people who have this power also have the right not to invoke

the complaint for improper reasons or use

Bridges v. Diesel Services, Inc.

--Facts

Plaintiff is James Bridge and the Defendant is Diesel Services Inc. –

the complaint is under the Americans with Disabilities Act (ADA).

Bridge believes that he was dismissed from his job because of his

disability, thus violating the ADA

The case was dismissed because of a lack of administrative

remedies – basically, the lawyer forgot to file a complaint with the

EEOC which is stated clearly as a condition to be met before

proceeding with this kind of suit

The defendant filed a motion for sanctions on the lawyer because

he failed to file all the correct paperwork before filing the complaint

--Issue:

Should the court grant sanctions for the defendant under Rule 11 of

the Federal Rules of Civil Procedure?

--Holding

The lawyer had already figured out his mistake and was proceeding

to fix his mistakes – PLUS he filed a motion for suspension

(P)’s counsel did not display a competent level of legal research,

because if he had, he would have known about the EEOC filing

requirement.

But the court decided not to impose sanctions, because the prime

goal of Rule 11 sanctions is deterrence of improper conduct and in

this case, monetary sanctions are not necessary to prevent future

misconduct.

--What happens now?

The court could have sanctioned the lawyer for his failure to file

with EEOC, but they recognized a few things:

o They saw that the lawyer only made a procedural mistake, not

a substantive one – he corrected his mistake right after he

was informed

Instead of sanctioning the lawyer, they decided that he had learned

his lesson on his on without any need for real punishment

The court also dismissed the case without prejudice, meaning the

lawyer can re-file the complaint once he has met all the conditions

of this kind of suit

--The court also makes a distinction to show that Rule 11 is only to be used

in situations where the lawyer has gone above and beyond to mess up a

case – it is not to be used when someone makes a silly mistake

However, if and when the lawyer does re-file the complaint, he must

show that he is competent – he must do a stand-up spotless job on

this case because the court will be watching for any mistakes

--Rule 11 of the Federal Rules of Civil Procedure

All lawyers are subject to sanctions and punishments if we do not

follow all the rules and do the research we have to do in order to file

motions, pleadings, complaints, etc.

Malpractice and violations of the rule of ethics can come up through

this rule if the lawyer is found to have violated this rule

This also takes a huge dig on your reputation as a lawyer – they

even said in the decision that the lawyer was “incompetent”

o That will stick with the lawyer for a while – other lawyers will

know, possible clients will be able to find out, and judges will

remember what wrongs you have committed in court

While the sanctions can be lenient like this one, judges can decide:

o to dismiss your case completely with prejudice,

o make you pay monetary reparations,

o bring your law firm into the case, etc.

Always do your research and MAKE SURE you do exactly what you

need to do file anything or make any moves with a case or suit you

are pursuing

Notes and Problems on pg. 14-15

1. The lawyer did not meet all the conditions for filing this kind of suit

because she failed to file a complaint with the EEOC. The lawyer should have

done more research on this type of case before she filed the complaint in

order to discover what conditions and requirements were needed for this

type of case. The lawyer violated “warranted by existing law” in Rule 11b2.

2. A) The word in Rule 11c is “it must not be filed… if corrected within 21

days.” B) I think the court could have been more strict on the lawyer because

she did not follow procedure for filing this type of case because she simply

did not do the research for it – she should be thankful they did not do

anything worse to her, like monetary sanction or dismissing the case without

the ability to re-file.

3. The defendant is promised constitutional rights by the US, and one of the

those rights is that they will have due process of law. The defendant had a

right to file the sanction because if the court would have pressed on, then

the time limit would have been cut short thus not allowing the defendant to

prepare their case for the suit. B) ??

--Federal Rules of Civil Procedure

These rules are like statutes and the constitution in that they state

general rules, not instances and how those should be handled

specifically

However the rules do not differ from the statutes in 2 different

ways:

o The Rules are not directly enacted by the legislature –

Congress empowered judges in 1935 to write these rules with

a statute

o The Rules may only deal with practice and procedure – they

cannot affect any topic concerning the Constitution

There is a thin line between substance and procedure in

the legal profession

For example, the judges are not allowed to write a rule

the governs how to deal with damages from a breach of

contract – that is only a power of Congress

However, the judges are allowed to write a Rule

concerning the procedure to file a suit based on

damages from a breach of contract

The original Rules were not written by the justices, nor do the

justices themselves amend the Rules – the Chief Justice of US

Supreme Court appoints lawyers, judges, and professor to different

committees

o Committee on Civil Rules – considers proposed amendments

and changes to the legal profession; holds public hearings,

produces changes based on those hearings, and submits the

results to the Standing Committee

o Standing Committee on Rules of Practice, Procedure, and

Evidence – further considers and refines the amendments,

then passes them on to the Judicial Conference

o Judicial Conference of the US – presided over by the Chief

Justice of the US Supreme Court; this is the senior

administrative body of the federal courts, and it deals with

judicial discipline, assigning visiting judges, approving

requests for new courthouses, etc.

o Passes on proposed amendments to the Supreme Court

o Supreme Court – it takes along time to get here & and so

most Rules are approved by this point (although some judges

have dissented)

o However the proposed Rule is still not a law

o Congress – the proposed Rule is then passed onto Congress

before May 1 of that year, and Congress has till December 1

to amend the rule or pass a statute against it

Some minor changes have taken place to the Rules (like adding a

holiday) while some have been major (creating modern class action)

These Rules do not only affect the federal courts for which they

were created – some states have adopted the Federal Rules as heir

own procedure for lawsuits

--The Complaint: How are they filed?

Complaint: the initial pleading that starts a civil action and states

the basis for the court’s jurisdiction, the basis for the plaintiff’s

claim, and the demand for relief

Bell v. Novick Transfer Co

--Facts

Plaintiff filed a complaint alleging that the infant Plaintiff, Ronald

Bell, was driving in an automobile on Maryland’s public highways,

when he was run into and struck by an automobile-tractor owned by

the Defendant.

The complaint further alleged that the driver of Defendant’s vehicle

operated it in a careless, reckless, and negligent manner.

The complaint also alleged the injuries and damage, and that they

were the direct result of negligence on the part of the Defendant

--Procedural History

(D) moved to dismiss the complaint because

o 1) state a claim against the defendants,

o 2) it claims that the plaintiffs were injured because of the

negligence of the defendants, and

o 3) it fails to specify what the acts of negligence were

--Holding & Reasoning:

Defendant’s motion to dismiss was overruled. The Federal Rules of

Civil Procedure, specifically Rule 8, only require a “short and plain

statement of the claim showing that the pleader is entitled to relief.

Defendant is also not entitled to a “more definite statement by

motion under Rule 12(e).

--Discussion.

Where a Defendant needs further information to prepare his

defense, his appropriate recourse is not to file a motion to dismiss,

nor to file a motion under Rule 12(e) for a “more definite

statement” but instead to obtain the information by interrogatories

under Rule 33.Federal Courts only follow Federal Rules even if they

hear cases from state court

--What is official Form 9 in Appendix?

Notes and Problems

1. The defendants probably want to know exactly what types of negligence

took place so that they can either put together a defense as a group, or

move on with separate defenses. A) For the advantage of his case, he does

not need to tell the defendants everything and vice versa. B) Yes it would.

2. A) _____?? B) _____?

3. A) The suit was originally filed in a district court in Maryland. B) Yes it was

a mistake because Maryland maybe would not have allowed the complaint to

move forward because it did not include more detail about the case.

--The Response: Motion and Answers

Once the defendant has been notified of the suit/ charges against

him, he must give a response – the defense action

o In the example case of Peters v. Dodge, Dodge will contact his

insurer who will then hire a lawyer for the suit

o However, in a case dealing with liability, almost all liability

policies allow the insurer authority to settle the case – not the

insured

The insurer could decide to settle the case OR contest

the liability and litigate

The first thing to do if you decide to contest the complaint is to

respond to the complaint, and this is accomplished in two different

possible ways:

o A motion attacking the summons/ complaint, OR

o A responsive pleading (usually called an answer)

--Motions: Pre-Answer Motions

Motions are simply requests that the court to do something –

dismiss the case, enter judgment on verdict, etc.

o Lawyers talk about “moving” or “making a motion” – these

are tried in order to end the case or alter its shape

o An important characteristic: these motions take NO position

on truth or falsity of the plaintiff’s allegations

One motion has to do with ending the case because the action

simply should not be processed – ex. like a case in federal court that

does not have subject matter jurisdiction

Another motion has to do with ending the case because under

substantive law, the plaintiff has no right to relief – ex. the

defendant drives an offensive colored car

When a motion is filed, the other side will have to be notified of the

plan to make a motion, what kinds of motion, and the time and

place the motion will take place.

o Also, a memorandum of points and authorities will be given

o Also, include any evidence pertinent to the motion – like an

affidavit or copies talking about where the plaintiff and

defendant hold residence and their local affiliations

Then the judge can then do a few things:

o Hear the lawyers arguments for their individual clients

o Decide the motion on the spot, or reserve more time for

additional research and thought

o Give a tentative ruling and then allow the losing side to argue

against the ruling

Notes and Problems

1. The plaintiff simply wants the case to end of change?? The defendant

would then not have to answer because the case would be gone.

2. B and C are proper.

The Answer: response to the plaintiff’s allegations

If the defendant decides not to file a motion OR the court does not

grant the motion, then the defendant must give an answer

o Rules 7a & 12a: 21 days to file an answer, etc.

Two essential variations

o The defendant can deny the truth of the allegations; OR if he’s

not sure if the allegations are true, then he can deny them

until he finds out

o The defendant can claim an affirmative defense the will

wholly or partially defeat the plaintiff’s claim

Rule 8c – they can claim that the plaintiff’s own

negligence contributed to the car accident

The defendant can also make a claim of his own: counterclaim,

cross-claim, or third party-claim

o Counterclaim – a claim for relief asserted against an opposing

party after an original claim has been made

o Cross-claim – a claim asserted between co-defendants or co-

plaintiffs in a case and that relates to the subject of the

original claim or counterclaim

o Third party claim - ?????

Notes and Problems

1.

2.

3.

4.

5.

--Amendment of Pleading:

The Federal Rules reject the view that the case is set in stone once

the pleadings are completed.

o There can be amendments to cases and pleadings because of

discovery rules

Discovery rules can allow both parties to investigate into the claims

and gather further evidence

o Example: a man who is being sued by the victim of a car

accident actually finds out that the car belongs to the

defendant’s daughter – she can now be added as a defendant

Rule 15: deals with the evidence discovered during a trial, after the

trial is decided, and evidence found once the time has run out on a

case to appeal

--Parties to the Lawsuit

Even though some cases are just between one plaintiff and one

defendant, MOST of the time cases are brought to the court by

multiple people or a case is brought against multiple people

See Rules 19, 20, 23, and 24

o Rule 20: governs permissive joinder

This is the optional joining of parties together in a case

if 1) their claims or allegations are in respect the same

or the same situation, AND 2) any legal or factual

question common to all in the party will arise

They have a choice of who to join as a co-plaintiff/co-

defendant

Rule 19

Rule 23

Rule 24

Larson v. American Family Mutual Ins. Co.

-- Facts:

(P)’s original suit was filed against insurance company for failure to

pay homeowners claim. When original attorney commits

malpractice by failing to pursue the claim for personal reasons,

second claim is added against the attorney (attempting to make the

attorney a co-defendant)

--Procedural History:

Claim originally filed with attorney Ross-Shannon, but he didn’t

pursue the claim because he was pursuing a job to represent the

defendant. Plaintiff retained new counsel and filed in state court,

removed to federal court on diversity jurisdiction and then tried to

add the former attorney as a co-defendant.

Defendant objects because time expired and the two issues did not

arise from the same transaction.

--Issue: (a) Was motion to add the second claim timely? (b) Is the motion

allowed by the ‘same transaction’ rule?

Holding: (D)s are joined and the case goes back to state court according to

the rules of 28 USC §1447(e)

(a) Yes, claim was filed as soon as the plaintiff had adequate

evidence to file it.

(b) Yes, duties of each party may have been different, but the

breach was the same transaction.

Reasoning:

(a) Discovery happened in January 2007, and the claim was filed in

February 2007. Even though they may have known more

information, they waited for discovery to get hard evidence.

(b) Duties of each party may have been different, but the breach

came from same transaction and thus the claims can be joined.

Joiner is permitted if claims are

o (1) arising out of the same transaction, AND

o (2) contain a common question of law.

Notes and Problems

1. The plaintiffs wanted the case to be tried in state court anyway.

2. A) The defendant uses Rule 15 to prove that the claim should have been

made within 14 days, not several months. B) the original claim stated that

the insurance company had breached their contract and had failed to pay

them money that the company owed them – the defendant believes that he

had nothing to do with this action because he was not involved at this time.

C) _____???

--Factual Development: Discovery

Broad and deep discovery does define some of foundation of

modern civil procedure

o NOTE: questions of jurisdiction, pleading, and parties typically

takes place at the “pleading stage”

Discovery assumes that pleadings have occurred, and this stage

probes the facts beneath the parties contradictory allegations

against one another

o However, discovery is not fact investigation

Rule 11 states that lawyers are required to do some pre-pleading

investigation of the “facts”

o They can use observation, personal knowledge, or

conversations with anyone who will talk to them

o Example: the plaintiff who was harmed in the car accident is

also active in college sports – the lawyer can talk to the

coaches and teammates to see what his pre- and post-

performance was like; the lawyer can also hire a photographer

to take pictures of him practicing

Another problem is that most people close to someone involved in a

case will most likely not speak to a lawyer or make any comments

about the case to a lawyer

However, a major innovation in the discovery rules has a provision

that compels people involved in a lawsuit to cooperate in the

discovery of factual background

o Rules 26-37 and 45 give parties these powers

Rule 26: a party is required to reveal to the other party

basic info like names of witnesses, documents, etc.

26.B – info must be relevant to the case, & cannot

be included under privilege

26.C – the retrieve all the info may not be granted

if the act of retrieving it is “overly burdensome”

o Rule 33: parties may obtain other info by asking questions

through an interrogation

o Rule 34 and 45: requires the production of records

Rules of Discovery can also lead to allowing info to be found that

will weaken the other’s defense – so there are THREE restrictions

o Parties may discover evidence that is only relevant to a claim

or defense in the case

o Even if relevant, the requested info may be protected by

privilege

o Even relevant, unprivileged info may be undiscoverable if a

party can convince a court that its potential for harm will

outweigh its value

Under the Federal Rules, the provisions for broad discovery

implicitly suggest that dismissals should NOT occur until the parties

have had a full opportunity to obtain factual info about the case

**Magistrate Judge: they have the power to settle cases that are agreed to

be decided by this kind of judge; they handle organizing the council for multi-

district cases and class-actions; they deal with pre-trial motions; they are

usually unique to the Federal judicial system**

*The Magistrate’s ruling is just a suggestion for the district court*

Butler v. Rigsby

--Facts

Defendant made certain discovery requests from two medical

groups of the doctors that provided medical treatment to the

plaintiffs in the accident. He asked for numerous documents,

essentially every record they doctors had of their involvement in

litigation since 1992.

Both medical groups moved the court for a protective order

prohibiting the defendant from discovering the information

requested pertaining to their involvement in litigation on grounds

that it was not relevant to the lawsuit, is privileged, and that the

request was overly burdensome.

--Procedural History

The Magistrate ruled that most of the information was discoverable,

and this appeal followed. Then the medical group filed a motion for

protective order to protect them from complying with the

magistrate’s order

o Hospitals have argued a privacy violation because of

privilege, the information is not relevant to the lawsuit, and it

is extremely burdensome

--Issue = What is the scope of discovery in a civil proceeding?

--Holding = Hospitals must produce the documents

--Reasoning

Despite finding that the matter requested was discoverable, the

time and expense involved in producing it convinced the court to

order the defendant to pay one-half the cost of producing the

information.

The Federal Rules of Evidence contemplate liberal discovery and

provide for a flexible treatment of relevance. Under Rule 26(b) (1),

the scope of discovery includes any matter, not privileged, that is

relevant to the subject matter involved in the pending action. The

information need not be admissible at trial in order to be

discoverable if the information sought appears reasonably

calculated to lead to the discovery of admissible evidence.

However, discovery may be limited if the court determines that the

discovery sought is unreasonably cumulative or duplicative

--Significance

Essentially this case is an illustration of the broad range of

discovery powers granted parties under the Federal Rules, even

when it concerns non-parties.

Students should keep in mind that even where costs of discovery

outweighs the benefits, discovery may still be granted, although

reduced in scope from the amount requested

Notes and Problems

1.

2.

3.

4.

08/24/11 – class lecture

Appendix of Forms on page 171

Once you have done all the research you need to on the case, the court to

file in, what you want to file, etc., you will THEN file a complaint

You need to know the substantive law and place those facts into the

complaint before sending it to court

You can decide whether to put

o A lot of information

o Or only the necessary information

You may want as many details as possible because:

o This is the first time the court has seen your case – they can

see the terrible things the defendant has done to your client

o You will be able to possibly scare the defendant and his

defense attorney to make them maybe want to settle – to

show them how strong your case is

o You need to AT LEAST put enough details in the complaint so

that way the defendant cannot file a motion to dismiss the

case on grounds that there isn’t a REAL complaint

Notice pleading – you have to put enough info in your complaint

to tell the other party on notice of the lawsuit

There is NO Rule that states how much info you must put in a

complaint – no limit of what needs to be in there

If a court does dismiss the complaint because defense has proven

there isn’t a real complaint, then most courts will allow you to

amend the complaint without sanction

o Rule 15 is very liberal and this Rule guides this action

An example of a complaint is on page 19 in Yeazell

o The complaint MUST have information on it that proves the

allegation – you can’t just accuse someone of a crime if you

don’t have any facts

After the complaint is filed, the defendant MUST file a response

Federal Rules and state rules REQUIRE that a response be filed with

the court

o You will either admit or deny the allegation, OR that there is

not enough information in the complaint to continue on

Rules of Joinder

o This is when there are multiple plaintiffs, defendants, and/or

complaints in a case

o There can be an initial claim, and then a counterclaim can be

filed

Example: Peters files that Dodge wrecked his car by

running a red light – Dodge then files a response saying

that he is denying the complaint, and then files a

counter claim saying that Peters ran the red light and

wrecked his car

If Peters had a passenger in his car, then the passenger

could join in on Peters claim to sue Dodge.

Peters could also sue the company that made the car

because he has discovered something stating that

something in the car made Dodge wreck into Peters.

Then Dodge could say that he is not at fault here nor

was he negligent in this situation – he can file a cross-

claim to join Peters suit on the car company

Dodge can also file a third-party claim which would

bring a third party into the suit – Dodge could bring in

his insurance company because they had a contract of

insurance to protect him – both are at fault

o Class action – just how many plaintiffs do we want to put in

one lawsuit?

These came out of massive tort suits and consumer

issues – cards come in the mail talking about any kind of

injustice you have experienced

Example: a card come in the mail stating that your

energy company has overcharged you by $1 for the

seven years – if you discover this and there are 500

other customers who had this happen to then – this

would be a class-action suit

08/26/11 – pgs. 33-53

F. Pretrial Disposition – Summary Judgment

Not all cases should reach trial – trials involves substantial financial

and social costs; little purpose is served by unnecessary trials

Because of this, Federal Rules adopted summary judgment, which

provides a mechanism for deciding cases for which a trial is not

necessary and would serve no purpose

o Rule 56 regulates summary judgment:

o 56.A: a movant is entitled to this judgment by law if here no

genuine dispute of fact in the case

o 56.C: requires that a court grant summary judgment when

there is “no genuine issue to any material fact”

o 56.F: the decision of a motions for summary judgment will be

delayed in the opposing party has not or was not able to

complete their discovery

The court always tries to see if there is any genuine dispute of fact

BECAUSE that is supposed to be decided by the jury what is true

The court tries NOT to evaluate the creditability of witnesses – juries

decide the creditability

The court ONLY grants this if a case does not have enough evidence

that the case can go forward

--Default Judgment

Other times, a court will grant default judgment: Rule 55

o The defendant does not answer the complaint entirely, OR

o The defendant fails to defend completely, OR

o The defendant fails to show up for court

--Dismissal

If the plaintiff does not obey any order presented by the court, the

court can grant a dismissal: Rule 55

o The most common reasons for a dismissal are:

Failure to comply with discovery orders

Failure to prosecute the case

Failure to appear for calendar calls, motions, or pretrial

conferences

Also, a plaintiff can seek a voluntary dismissal:

o Plaintiffs will seek this if he/ she believes that their case will

be better off if they start over

Rule 41

Houchens v. American Home Assurance Co.

--Facts

Mr. Houchens disappeared in August of 1980, after traveling to

Bangkok on a vacation from work at International Civil Aviation

Organization. Mrs. Houchens wishes to collect on one of two life

insurance policies

o One policy covers Mr. Houchens for occupational accidental

injury or death

o The other policy covers Mr. Houchens for non-occupational

accidental injury or death

Mrs. Houchens brought an action to declare Mr. Houchens legally

dead by Virginia law in 1988 – the order was issued in 1988 stating

the Mr. Houchens was indeed presumed dead.

American maintains that they are not obligated to pay either of the

two policies because there is no evidence of Mr. Houchens’ death

nor any evidence of an accidental death

--Procedural History

American filed for a summary judgment based on their position in

the trial court (no dispute of fact), which was granted in favor of

American – the suit was dismissed

Mrs. Houchens is appealing the case against the summary judgment

granted by the trail court

--Issue = Was the summary judgment granted by the trial court granted

erroneously based on the evidence presented at trial?

--Holding = The summary judgment STILL stands because Mrs. Houchens

was not able to provide sufficient evidence of the accidental death.

--Reasoning

The burden was on Plaintiff to prove that her husband died by

accidental means. A District Court does not err in granting summary

judgment where a jury could not reasonably conclude that it is more

likely than not that the Plaintiff can prove the elements of his claim

Mrs. Houchens never provided the evidence needed to prove the

existence of the accident – No bizarre circumstances surrounding

his disappearance, NOR was he seen in any grave danger

The very small amount of details provided by Mrs. Houchens about

the “presumed” death of Mr. Houchens would not provide enough

detail for a jury to decide the case

--Significance

Summary judgment is mandated against a party who 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.

G. Trial

Around 5% of cases actually see trial, and a great number of those

cases are settled during the trial or in the appellate stage

When a trial does occur, it consists of opportunities for each side to

present their case before the court judge or jury

The plaintiff will have an opportunity to do the following (which the

defendant will also have the same opportunity):

o Make an opening statement

o Present his case

o Make a closing statement

There are also smaller details:

o For each witness, one side gets to examine that person and

then the other side will cross-examine the witness

o This takes places to draw out the witness’s story

Witness testimony also brings out two major principles:

o The parties are responsible for proof, and

o The party going first bears the burden of providing evidence

and persuading the trier of fact that their version is more

likely to be true

--Judgments of the Court

A judge is placed in the courtroom in a jury trial to make sure there

is enough evidence being presented that a reasonable fact-finder

can find a verdict

Trier of fact is normally a jury in US courts, which is provided for in

the US Constitution in the 7th Amendment

However, a judge has power over a jury:

o A judge can limit a jury’s power in a civil case

o A judge may refuse to submit a case to a jury

o A judge may grant judgment by overturning the jury’s verdict

--Directed Judgment or Directed Verdict: Rule 50

Directed judgment: a party moves for this before the jury even

reaches its verdict

o The jury is dismissed and the judge decides the case

o The judge basically grants this when he decides that there

isn’t enough evidence to present opposing sides

The opposing party can move for directed judgment after the

plaintiff has rested their case, OR whenever they feel after that

--Judgment Notwithstanding the Verdict: Rule 50

JNOV : after hearing the jury’s verdict, the judge can decide the

case by overturning the jury’s verdict of the case

The judge is able to use this type of judgment when he feels that

the jury had no option but to reach a certain verdict because of the

facts

Norton v. Snapper Power Equipment

--Facts

Plaintiff was using a mower manufactured by Defendant on January

24, 1983. Plaintiff testified that as he drove up an incline, the

mower began to slide backward towards a creek, despite the fact

that he was applying the brakes. The lawn mower, with Plaintiff still

aboard, crashed into the creek. At some point during the crash,

Plaintiff’s hand was caught in the mower’s blade, and four of his

fingers were amputated.

--Procedural History

Plaintiff then sued Defendant. The jury returned a verdict in favor of

Plaintiff. Upon dismissing the jury, the district court issued a

judgment notwithstanding the verdict. This appeal followed.

--Issue = When should a court grant a JNOV?

--Holding = The trial court’s directed judgment is reversed to show the jury’s

verdict instead, which is in favor of the plaintiff

--Reasoning

There was enough evidence presented by the plaintiff that the jury

could have reached their verdict reasonably (the defective dead

man device)

Although the evidence was circumstantial, it was also very

impressive – experts testified that if the “dead man” device had

been effective, the injury could have been avoided

Only where the evidence so strongly and so favorably points in the

favor of the moving party that reasonable people could not arrive at

a contrary verdict. The jury is permitted to reconstruct the series of

events by drawing an inference upon an inference.

H. Former Adjudication

Adjudication: the legal process of resolving a dispute, or the

process of judicially deciding a case

Double Jeopardy: prevents a person from being tried twice for the

same crime

o This is also included in Civil Procedure, where a plaintiff who

brings a case, or a defendant who defends one, SHOULD NOT

be able to try again if he is not satisfied with the result

o This is called Former Adjudication, or Res Judicata

--Former Adjudication – Claim Preclusion OR Issue Preclusion

Claim preclusion: if Plaintiff A sues Defendant B and loses OR is

not satisfied with the money awarded, A cannot sue B again; OR if A

wins, B can appeal – BUT B cannot bring about a second action to

set aside the first judgment

o Doctrine of res judicata For this to apply, the claim MUST

BE the same in both the first and second action

o Example: A can’t sue B for injury to his arm in one case, and

then injury to his leg in another case

Issue preclusion: you can’t re-litigate issues over and over again

in the court

o Example: A sues B on a promissory note, and B claims fraud;

well A wins the case and then brings B into another suit with a

different promissory note; B cannot claim fraud again based

on the first case because that issue was already decided and

stands away from the issue in this second case

Some states used to allow property damage and personal injury to

be separated in lawsuits legally – however, most courts now enforce

that all people must bring about all claims in one suit from one issue

o Doctrine of collateral estoppel

Example: from the case below, the decision on Mrs. Rush’s case for

City’s negligence could be seen as binding if the next suit from this

issue is filed by Mr. Rush for City negligence

Rush v. City of Maple Heights

--Facts of Both cases

Plaintiff was riding her motorcycle with her husband one day, when

they hit a hole in the road, which caused substantial damage to the

motorcycle and injuries to the plaintiff

--Procedural History

(P) first filed suit against the City for the damages to her motorcycle

(property), which (P) wins; THEN (P) filed second suit against the

City for her personal injuries (legally able to do this because of

claim preclusion!!)

o (P) argues that the previous decision on City’s negligence for

her property is binding on the second suit of personal injury

The court handed judgment in her favor for personal injuries

The defendant then appealed the second lawsuit on basis of issue

preclusion, claiming that the first suit should have included both the

property damage and the personal injuries – (D) claimed that the

second suit was not valid

--Issue = Is the second suit filed by the plaintiff valid on the basis of issue

preclusion?

--Holding = The previous personal injury judgment is reversed, and the

judgment is handed down in favor of the defendant.

--Reasoning

Where a person suffers both personal injuries and property damage

as a result of the same wrongful act, only a single cause of action

arises because the different injuries are really separate items of

damage from the single act

The plaintiff should have included her personal injuries in the first

suit because the second suit is not valid

--Significance = This case expresses the general notion in civil procedure

that a plaintiff who brings a case, or a defendant who defends one, should

not be able to try again in a later suit if he is not satisfied with the result in

the first suit.

However, as this case also demonstrated, not every court agrees

that a plaintiff’s claims for personal injuries and property damage

arising out of the same accident are part of the same claim.

The court in this case adopted this majority view, refusing to allow

Plaintiff to sue for personal injuries in one action, and property

damage in the later action

I. Appeals

Our judicial system permits losing parties to appeal an adverse

judgment of a lower court to a higher court

o Circuit courts of appeal are numbered 1-11

o The DC circuit appeals to the DC Circuit Court of Appeals

o Federal court appeal to the Federal Circuit of Appeals

After the court of appeals for any level of government, the next step

for appealing a case goes to the Supreme Court

These address the correctness of trial court rulings that are likely to

have affected the outcome

o Appeals cannot be used to correct counsel’s mistakes during

the first trial or during pretrial proceedings (even if they

affected the outcome of the case)

o Errors from prior cases are what is used for appealing a case

o You must object to errors happening during the trial so that

way you could appeal the case later

o Example: if (D) wants (P) to produce documents for a lawsuit,

but the trial court does not allow your objection – you must

wait until later to file an appeal on the decision of (P)’s

objection to produce documents

o There would be no point in allowing each person to appeal

each action in a case that does not go the way a party wants

it – there would never be any trials!

Apex Hosiery Co v. Leader

--Facts

Plaintiff filed an action for treble damages under the Sherman Anti-

Trust Act. Apex then made a discovery request of the Defendant for

the discovery and production by them of documents for inspection,

copying and photographing for the Plaintiff’s use at trial.

The District Court ordered the production of the documents

pursuant to FRCP 34. Defendant now appeals that order

--Issue = Is a discovery order issued by trial court appealable?

--Holding = The Third Circuit dismissed the appeal and upheld the order for

production.

--Reasoning

An order of this nature is interlocutory, and therefore, not

appealable. It is only when refusal to comply with a discovery order

happens to result in an order punishing criminally for contempt that

a party may have review by appellate proceedings before a final

judgment is issued

The Court found that the disposition of the discovery motion would

determine the conduct of the trial and likely the outcome as well.

Thus, like other motions made prior to or during trial to secure or to

suppress evidence, unless the court order results in the opposing

party being held in contempt, the Court will not review an appeal of

a discovery order so long as the order is carefully drawn so as not to

unduly pry into the opposing party’s affairs

Notes and problems

If the case is dismissed on the basis of lack of evidence, then you

can appeal the case.

08/30/11 Pg. 55-75

A. There are two approaches to looking at the procedural system:

--Top to Bottom – starts with the constitutional environment in which the

lawsuit exists

This approach goes from between the history and current

interpretation of the US Constitution

Studying the Constitution reveals several limits on the ways state

and federal court systems conduct business – these limits have

severe consequences for individual litigants

--Bottom to Top – starts with the life cycle of each individual lawsuit

Life cycle: how the parties initially state their grievances, develop info about

them, and bring them to resolution

B. Constitutional Limits in Litigation

1. The Idea of Jurisdiction

Jurisdiction, more or less, means “the power to declare the law”

Think about if you had a problem with the landlord of your

apartment – you would not complain to the landlord of another

apartment complex because they do not have “jurisdiction” to help

remedy your complaint

“The law of jurisdiction” and “legislative jurisdiction” tend to signify

a state or territory whose government has the power to make law

within its bounds.

Judicial jurisdiction: the power of a court to render a judgment that

other courts and government agencies will recognize and enforce.

o If the reason or situation for filing a lawsuit took place in

California, you would have a hard time being able to file the

suit in a Louisiana court – LA does not have jurisdiction over

the matter because it took place somewhere else

o The only way you would be able to file a suit in a federal court

would be if

It fell under federal law, OR

You and the other party are of diverse citizenship

look on page 57 for picture!!!

2. Jurisdiction and the Constitution

A court needs two different types of jurisdiction – they are both

necessary ingredients of any court’s power to render a binding

decision in a case

o Personal Jurisdiction: a court’s power to bring a person into

its adjudicative process; jurisdiction over a defendant’s

personal rights, rather than merely over property interests

o Subject Matter Jurisdiction: jurisdiction over the nature of

the case and the type of relief sought; the extent to which a

court can rule on the conduct of persons or that status of

things

No single government entity has plenary power – this is set out in

our US constitution by our checks and balances

Because the US Constitution defines the lines of authority among

the competing centers of power, courts look to the Constitution for

their basic framework in deciding issues of judicial jurisdiction

3 parts of the Constitution bear on jurisdiction:

o Article III, Section 2 – authorizes the establishment of the

system of federal courts & sets the limits of the federal

judicial authority

Congress has the power to restrict the scope of federal

judicial authority

This deals with subject matter jurisdiction

look on page 57 for picture!!!

o Article IV, Section 1 – requires that “Full faith and credit… be

given in each state to judicial proceedings of every other

state”

Supreme Court has interpreted this to mean that one

state must recognize and enforce judgments of another

state

Deals with personal jurisdiction

Example: if A sues B in Louisiana state court, and A wins

$$$ from the judgment – if there are no assets in

Louisiana of B, then A may file the suit in the state that

has B’s assets – that other state must recognize and

enforce the judgment of Louisiana state court

However, the other state only needs to recognize this

clause when the judgment comes from a court that had

jurisdiction over the suit

o 14th Amendment, Section 1 – no “state shall deprive any

person of life, liberty, or property without due process of law”

This has proved to be one of cornerstones of modern

constitutional and procedural theory

Deals with the notorious Pennoyer v. Neff case and

personal jurisdiction

3. The Constitution and Choice of Law

The US Constitution shapes US litigation by dictating which set of

laws a court must apply to a dispute. It does this in 2 ways:

Article VI – provides that the Constitution and federal laws “shall be

the supreme law of the Land; and the Judges in every state shall be

bound thereby, any Thing in the Constitution or Laws in every State

to the Contrary notwithstanding”

o Referred to as the Supremacy Clause

o Basically, if Congress enacts a statute that deals with a

particular subject, then both federal and state courts are

required by law to enforce the federal statute (even if there is

a contrary state statute or state common law)

o In the absence of a controlling federal statute, the federal

court system is required to respect both the statutory and

common law rules of the several states

PERSONAL JURISDICTION, CH. 2

A. Origins

This is part of US constitutional law because of Pennoyer v. Neff –

the case whose deceptively simple facts spawned a new doctrinal

elaboration

Background of Pennoyer v. Neff

o One of the more difficult parts of a lawsuit is when the plaintiff

tries to collect from the defendant who declines to pay

o When this takes place, a plaintiff may obtain a writ of

execution from the court, which will authorize:

The sheriff to seize any property belonging to the

defendant,

Sell the seized property, usually through auction, AND

Give the resulting money to the plaintiff

Once the property is sold, the sheriff will give the buyer

a “sheriff’s deed” as evidence of an ownership title

o Constructive notice – generally constructive means

“fictional” or “pretend”

If a defendant cannot be found to be served notice of a

lawsuit, then some states will provide notice in a

newspaper

This notice through the newspaper is called

“constructive notice” because the defendant is very

unlikely to see it

o Attachment – the legal term for an officially sanctioned

seizure of property

Pennoyer v. Neff

--Facts

Mitchell brought suit against Neff to recover unpaid legal fees.

Mitchell published notice of the lawsuit in an Oregon newspaper but

did not serve Neff personally. Neff failed to appear and a default

judgment was entered against him. To satisfy the judgment Mitchell

seized land owned by Neff so that it could be sold at a Sheriff’s

auction. When the auction was held Mitchell purchased it and later

assigned it to Pennoyer.

--Procedural History

Neff sued Pennoyer in Oregon federal district court to recover

possession of the property, claiming that the original judgment

against him was invalid for lack of personal jurisdiction over both

him and the land.

The court found that the original judgment in the lawsuit was invalid

and that Neff still owned the land.

Pennoyer lost on appeal and the Supreme Court granted certiorari.

--Issue = Can a state court exercise personal jurisdiction over a non-resident

who has not been personally served while within the state and whose

property within the state was not attached before the onset of litigation?

--Holding = judgment for Neff is affirmed

--Reasoning

A court may enter a judgment against a non-resident only if he

o 1) is personally served with process while within the state, or

o 2) has property within the state, and that property is attached

before litigation begins (i.e. quasi in rem jurisdiction).

Since the adoption of the 14th Amendment, the validity of judgments

may be directly questioned on the ground that proceedings in a

court of justice to determine the personal rights and obligations of

parties over whom that court has no jurisdiction do not constitute

due process of law.

o Due process demands that legal proceedings be conducted

according to those rules and principles which have been

established in our systems of jurisprudence for the protection

and enforcement of private rights.

To give legal proceedings any validity, there must be a tribunal with

legal authority to pass judgment, and a defendant must be brought

within its jurisdiction by service of process within the state, or by his

voluntary appearance.

The substituted service of process by publication in actions brought

against non-residents is valid only where property in the state is

brought under the control of the court, and subjected to its

disposition by process adapted to that purpose, or where the

judgment is sought as a means of reaching such property or

affecting some interest therein; in other words, where the action is

in the nature of a proceeding in rem.

The Oregon court did not have personal jurisdiction over Neff

because he was not served in Oregon. The court’s judgment would

have been valid if Mitchell had attached Neff’s land at the beginning

of the suit. Mitchell could not have done this because Neff did not

own the land at the time Mitchell initiated the suit. The default

judgment was declared invalid. Therefore, the sheriff had no power

to auction the real estate and title never passed to Mitchell. Neff

was the legal owner.

Notes and Problems

1. A) I believe Neff only learned of the original suit after learning that his

property had been seized by the sheriff and sold to Pennoyer. B) The

absence of a notice is a strong objection because the notice in this case was

in a different state than the Neff was residing, plus he was not a domicile of

that state either. C) The court does discuss this objection, and decides that in

the Code of Oregon, notice can be fulfilled through a newspaper for the

defendant to learn about the lawsuit. The notice in the paper, however, can

apply to a non-resident of the state, BUT the property in the proceeding must

be attached to the original suit.

2. The property would had to have been attached to the litigation at the

beginning of the suit – it could be attached after the judgment had already

been handed down to satisfy payment. Another way is if Neff would have

appeared in the original suit – then the courts could have taken his property

and used it to satisfy the original judgment.

3. A)???? B) All cases following Pennoyer v. Neff deal with the tricky line

between blocking interstate commerce and avoiding abusive litigation.

4. A) To gain personal jurisdiction over a person, the state must serve proper

notice over the person according to the other state’s laws. The Oregon court

could gain jurisdiction over Neff because: -Neff was not a resident of the

state of Oregon, nor was he even present in the state when the notice came

out; -Mitchell needed to sue Neff in Neff’s own state, or served Neff

personally in his own state so that way he would appear in court. B) The

Oregon court did not seize the property from the outset of the trial because

Neff did not own the property at the outset of the lawsuit – they merely took

the land after the judgment was handed down to satisfy the compensatory

element of the judgment. C) A state can have court proceedings that hand a

judgment down against the defendant of another state, but that judgment is

only binding in that state and ONLY when the defendant returns to the

court’s state????

5. Neff never appeared in court for the first lawsuit brought by Mitchell,

because he was not given proper notice of the lawsuit NOR was he ever told

about the judgment handed down against him???

6. A) B can’t dismiss the case because they have taken the action in his own

residential state. B) The judgment would be enforced because it came from a

North Dakota court, which is where the resident lives – thus the judgment

was handed down with personal jurisdiction. C) B could move for dismissal

because the action against him is not served to him in his residential state,

unless his residential state agrees to enforce the judgment?? D) They will

enforce it under full faith and credit; once ND court agrees to enforce the

judgment from Missouri, then jurisdiction doesn’t matter?? E) because A

attached the land to the suit before judgment was handed down, A can sell

the property. F) Sounds like Pennoyer – there will be no enforcement of the

judgment because there is no basis for jurisdiction. G) What might happen

here is that the Minnesota court can grant the divorce because states have

the power to determine status of its residents. H) The Minnesota court

cannot do anything about the other person’s money or the child because

they do not have jurisdiction over the money or the child – the court only has

jurisdiction over the status of its resident. I) ND needs to abide by the ruling

of Minnesota – B should have remedied by appealing the decision with

Minnesota courts about error of their jurisdiction.

7. A) The Amendment should have applied because it is part of the US

Constitution guaranteeing citizen rights in trial, and it has binding authority

over all cases.

8.

Notes on Mechanics of Jurisdiction: Challenge and Waiver

Collateral attack: this is what happens when (D) if sued by (P) in

another state court besides the one that (D) is a resident of. If (D)

believes that the other state court does not have jurisdiction on

himself, then he simply will not have to answer the suit

o After the default judgment is handed down in the other court

and the (P) goes to file the judgment with (D)’s state court,

then (D) simply had to battle the judgment from the other

state, claiming they do not have jurisdiction over him.

Jurisdiction is the only thin subject to collateral attack

A defendant may raise jurisdictional defense either in his answer to

the lawsuit or by filing a pre-answer motion.

o Any pre-answer motion that omits a defense of personal

jurisdiction is treated as waiver of jurisdiction.

Defendant can appear in court, file a motion, or file an answer that

asserts their belief that the court lacks jurisdiction – however,

defendant must raise this issue the first time he raises any issue in

the suit, otherwise he loses the right to raise the issue of jurisdiction

o If defendant files an answer stating lack of jurisdiction, he

must also file to dismiss the case based on that answer

o Only a few states will allow a defendant a “special

appearance” to assert lack of jurisdiction because most

believe that if you show up to the case, then you are

consenting to that court’s jurisdiction

If defendant asserts that the court lacks jurisdiction but the court

rules that it does, when can the defendant file an appeal based on

court’s error based on lack of jurisdiction?

o Most states and federal courts require that defendant can’t

appeal jurisdiction until after the final judgment

The Mechanics of Jurisdiction: Challenge and Waiver

-Hypo about Abe and Barbara

Abe from Kentucky sues Barbara from Illinois in Kentucky court.

Barbara believes the Kentucky court lacks personal jurisdiction over

her. to assert this claim, Barbara’s options are:

o Object to the Illinois lawsuit by filing a pre-answer motion –

motion is to dismiss based on lack of personal jurisdiction

o Do nothing, and then collaterally attack when the default

judgment is sent against you

o File an answer – the answer would include her objection to the

court’s jurisdiction over her & motion to dismiss

Notes and Problems

B. The Modern Constitutional Formulation of Power

Pennoyer left A LOT of gaps for modern legal procedure

Power, consent, and notice all play a very important part in today’s

jurisdictional thought

1. Redefining Constitutional Power

Milliken v. Meyer

--Facts

Two partners in an oil well sued one another. Milliken (P) is a

resident of Wyoming and so is Milliken (D), and (P) filed a suit

against (D) in Wyoming state court.

(D) was served in Colorado at the time of the suit, where he was

hiding from the lawsuit; of course, (D) did not appear in court in

Wyoming because he was in Colorado during the suit.

--Procedural History

Thus a default judgment was entered against Meyer, for failing to

appear in court. After Milliken filed suit to enforce the judgment,

Meyer then collaterally attacked the judgment against him asserting

a lack of basis because of lack of jurisdiction

--Issue = Is domiciliary status in state court alone sufficient to establish

proper nexus to establish personal jurisdiction over an absentee defendant

who is served out-of-state?

--Holding = The original judgment against Meyer was valid – the court

claimed that Meyer was given full notice of the suit because he was

personally served by the Wyoming court while he was in Colorado

--Reasoning

Wyoming had a statute about service of process, and the Court

needed to decide whether that statute was constitutional

Based on Pennoyer, this service would not have been proper – they

would have had to do in rem jurisdiction.

However, the Court holds that this satisfies due process as long as

the process is reasonably calculated to give notice of the suit and

an opportunity to be heard, so that traditional notions of fair play

and substantial justice will be satisfied [constitution]

They also held that Wyoming still had authority over Meyer even if

he was not present in the state because he still expected protection

from Wyoming so he was still subject to their laws

o Just because he was absent from the state at the time of the

proceeding in court, he still is subject to their laws and court

proceedings because he was domiciled (resident) there

--Significance = Court held that domicile is NOT contingent upon continuous

presence in the state & domicile in a state creates personal jurisdiction.

09/04/11 – pgs. 75-95

International Shoe Co. v. Washington

--Facts

(P) International Shoe [a Delaware Company whose actual principal

location is in Missouri] had several sales associates located in the

state of Washington (D) during 1937-1940.

(D) has a state statute that designates that each corporation in the

state must pay taxes under Employment Compensation Act. (P) did

not pay this tax, SO (D) later sent a notice through the mail to the

Missouri location and also served a salesman of (P)’s company

about the lack of paid taxes.

(P) showed up to court claiming that:

o the notice of the suit was not proper service,

o (P) was not a corporation in (D)’s state & was not doing

business in that state,

o (P) had no actual agents in that state with whom the suit

could be properly served, AND

o (P) is not an employer and thus does not fit under the state’s

statute

--Procedural History

(P) went to the agency and appealed the order to the administrative

tribunal, who then said that the order was mandatory to pay the

taxes back to the agency. (P) then appealed this to the State

Superior Court.

o Superior Court rules against (P) saying that (D) does have

jurisdiction over (P)

(P) now appeals the original judgment to the US Supreme Court

stating that Washington does not have jurisdiction over (P)’s

company, nor can Washington receive compensation from (P)’s

company because (P) is not “present” in the state so taxation would

be a violation of the due process clause

o (P)’s actions within the (D)’s state were not sufficient for

presence conferring jurisdiction

--Issue = Did International Shoe’s activities in Washington make it subject to

personal jurisdiction in Washington courts?

--Holding = Washington has jurisdiction to bring suit because (P) established

its “presence” in the state through its contacts.

--Rules & Reasoning

RULE: Pennoyer establishes that requirement of proper service of

process & the Due Process clause establishes that defendant is

subject to jurisdiction if he has minimum contacts with the forum

state where a suit would not offend “traditional notions of fair play

and substantial justice”

o Due Process is satisfied by looking at quality and nature of

activities in relation to fair and orderly administration of laws

Washington has jurisdiction because

o (P)’s activities were continuous and systematic in the state

during this time because they resulted in a large volume of

interstate business & (P) received the benefits of protection

under Washington law

o The suit here arises out of those contacts^

While the inconveniences presented to (P) by the suit in the forum

state do matter, in this case (P) subjected itself and consented to

jurisdiction through its contacts with the forum state

--Policy

The Court changes the definition of “presence” in this case – it is

now based on quality of contacts and activities in the state

o The Court foresaw all the issues that were to follow with

corporations in the US, so they changed it

--Evaluation = Minimum contacts with the forum state can enable a court in

that state to exert personal jurisdiction over a party consistent with the Due

Process clause.

A casual presence of a corporation or its agent in a state in single or

isolated incidents is not enough to establish jurisdiction.

Acts of agents of the corporation, because of the nature, quality,

and circumstances of their commission, may be deemed sufficient.

o Consent may be implied from the corporation’s presence and

activities in the state through the acts of authorized agents.

****When you get a PJ question on the exam, you need to test whether there

are minimum contacts with the state so that exercise of jurisdiction does not

violate the traditional norms of fair play and substantial justice****

Contacts can be continuous and substantial, OR contacts can be superficial

OR casual

--Does the suit arise out of the corporation’s contacts in the state, OR does

the suit arise because of something else?

If the contacts are continuous and substantial, AND the suit arises

out of the contacts in the state – then the state has jurisdiction

If contacts are continuous and substantial, BUT the suit does NOT

arise out of the contacts – then the state MAY have jurisdiction (if

the contacts are STRONG enough)

If contacts are casual, and the suit arises out of the contacts – then

the state has jurisdiction BC

o Someone is taking advantage of the rights, benefits, and

protections of that other state

--Hypo: if Michigan girl comes here to LA during a TS weekend, and she hits

an LA resident with her car – can LA girl sue her? YUP because the suit arises

out of the contact, even though the contact is minimal

If contacts are superficial, and the suit does not arise out of the

contacts – does not have jurisdiction

Hypo: Michigan girl comes down here, but after going back to Michigan

decides to sue somebody over property in Michigan – she chooses LA court.

NO jurisdiction because the contacts are NOT real, PLUS there is a violation

of fair play and substantial justice

Notes and Problems

1. A) B) C) The facts of the case would have to have changed by the

corporation’s lack of presence in the state – as in, the corporation did not use

the state’s laws as protection from its citizens AND the court’s enforcement

of those laws of protection.

2. What does the court mean when it says that a defendant must “have

certain minimum contacts with it such that the maintenance of suit does not

offend ‘traditional notions of fair play and substantial justice”? If the people

of this corporation were freelancers, I think the judgment would have differed

because then those people would not be considered real “employees” of the

corporation because of their lack of contract with the corporation; they do

not work for any certain corporation, instead they work for several. ****Meet

with Algero to discuss these issues****

3. General Jurisdiction versus Specific Jurisdiction – GJ says that, according to

this case, that any state can sue a corporation on issues that do not reside

within that corporation’s operations in the state; SJ says that a person’s

claim may only be valid by jurisdiction if the instant in which it regards. That

is, the jurisdiction only exists only because of the specific claim, but would

not apply in other claims.

4. A) I believe that Wyoming would have jurisdiction in this case only

because of the case’s specific circumstances – the suit arises out of the

contact even though they are not that strong. **The company benefitted

under Wyoming’s benefits and protections by law. B) **Wyoming would not

have jurisdiction over this case because of the minimal contacts and the suit

does not arise out of the contacts: when the woman worked for the

corporation, the location and activities took place in Missouri. The activities

and operations that took place during her employee never touched Wyoming

nor affected her life there. C) In this case, the contacts are strong and the

suit does not arise out of the contacts, SO the rancher would have

jurisdiction in Missouri because that is the home of the corporation. The

employee would not have trouble suing in Missouri because the employment

contract would be in Missouri – strong contacts. D) The rancher would have

to sue for the unpaid interest in Missouri because his shares are part of the

company in Missouri and are not affected by his location in Wyoming.

5. ????????

McGee v. International Life Insurance Co.

--Facts

The deceased, Franklin, obtained a life insurance policy from (D);

(D) sent mail to Franklin about the policy, and Franklin accepted the

policy. He then sent premium payments through the mail from his

California residence to (D)’s office in Texas until his death.

The beneficiary from the policy notified (D) that Franklin has died,

but (D) refused to pay out the policy.

--Procedural history

(P) brought suit against (D) in California claiming that (D) owed

payments from the policy. Notice of the suit was sent to (D) in

Texas, and a California court handed down a judgment saying that

(D) owed the payments.

(D) then appealed the Cali judgment to Texas court stating that

California did not have jurisdiction over (D) in the suit, thus making

the judgment not binding. Appeal was ruled in favor of (D) stating

that service or process was wrong.

(P) then appealed this case stating that a binding contract was

formed between Franklin and (D).

--Issue = Can a state exercise jurisdiction over a defendant whose contacts

with that state are limited to a single act or contract?

--Holding = YES but very narrowly. Cali does have jurisdiction over (D) in this

case because (D) had a substantial connection to the forum state

--Reasoning

In considering the contract was delivered in Cali, the premiums

were mailed from Cali, and the insured was a resident of California

when he died, combined with the recognition that modern

transportation and communication have made it much less

burdensome for a party sued to defend themselves in a state where

they conduct business, (D) is subject to jurisdiction in Cali.

There is no violation of just and fair play for the Cali court to enter a

binding agreement on (D).

Moreover, the Court reasoned that California residents would be at

a severe disadvantage if they had to leave their own state to obtain

payment from their insurance company

If (D) did not want to be subject to jurisdiction under Cali, then (D)

should not have made contact with the Cali resident.

--Policy = A state may exercise jurisdiction over a D whose contacts with that

state consist of only a single act, provided that that act is what gave rise to

the claim for which jurisdiction is being sought, and was deliberately directed

toward the state.

A state has a manifest interest in providing effective means of

redress for its residents when their insurers refuse to pay claims

Hanson v. Denckla

--Facts

Mrs. Donner created a trust with a Delaware bank, who was the

trustee. Mrs. Donner lived in Pennsylvania at the time of creating

the trust, but then she moved to Florida where she later died. Her

will was probated in Florida, where she was later domiciled.

Denckla and Stewart are the greedy daughters who only want to

split the trust between themselves – they say FL has jurisdiction.

Hanson is the other daughter who wants to split the money between

all 3 of them equally – she claims FL doesn’t have jurisdiction.

--Procedural history

(D) Denckla and Stewart brought the first suit in Florida court to get

the $$ from Donner’s trust.

--Issue = Is a non-resident corporation with no offices nor any business

transactions in forum state subject to jurisdiction in forum state by virtue of

plaintiff’s unilateral activity with defendant?

--Holding = Florida did not have jurisdiction over the trust.

--Reasoning

Delaware bank has no contacts within Florida except that its client

moved there. The trust was made in Delaware – which shows a

unilateral relationship between Donner and the bank.

o Donner reached out to make the original connection while in

Delaware

To constitute a contact with forum state, there must be some act by

which the defendant purposefully avails itself of jurisdiction but

maintains privilege of conducting activities within the forum State,

thus invoking the benefits and protections of its laws.

The unilateral activity of those who claim some relationship with a

nonresident cannot satisfy the requirement of contact with the

forum State. 

--Significance

After moving to Florida, Donner continued her already established

trust – she sought out the bank; whereas in McGee, the insurance

company reached across state lines to make the connection and

continue it.

Notes and Problems

1. Due Process Clause deals with any court in the US who wants to exercise

personal jurisdiction over any individual in the US.

It never depends on whether the case was tried in Florida or Cali –

the clause has to be applied the same way to every case

2. purposeful availment: did the defendant purposely avail themselves from

the ___

In McGee, the defendant did purposely avail itself from jurisdiction –

they reached across state lines to make the connection.

In Hanson, the defendant did not purposely avail itself from

jurisdiction – they made the connection in Delaware, not in Florida.

--Jurisdiction Types:

In Rem

Quasi in Rem

In Personam

***In rem jurisdiction deals with the property or status as the primary object

in the suit, rather than in personam jurisdiction which deals with personal

liabilities not necessarily associated with the property***

--The Modern Constitutional Formulation of Power (cont’d)

2. Absorbing In Rem Jurisdiction

The International Shoe case did not deal with jurisdiction over

individuals – only jurisdiction over corporations; it also did not deal

with in rem jurisdiction OR quasi in rem jurisdiction.

One of the most interesting things about quasi in rem jurisdiction,

while it lasted, was the possibilities it created for some cases:

o Plaintiffs could obtain jurisdiction by seizing not only tangible

property but also debts owed to the defendant

o Someone could bring action over someone else by

o Example: Harris, Balk, and Epstein – Harris was brought in a

suit by Epstein to pay Balk’s debts once he entered Epstein’s

state. Harris owed money to Balk who owed money to Epstein.

SC upheld this judgment

The consequences – a state could acquire jurisdiction over persons

whenever their debtors were present in the state by “attaching” the

debts.

Shareholder’s derivative suit – a shareholder steps forward and sues

the directors or officers in the name of a corporation, alleging some

breach of fiduciary duty

o The corporation is run by a board of directors and officers.

And when that corporation gets run into the ground through

possible fault of the directors and shareholders, a shareholder

can bring action against the officers and directors for not

doing their job well.

o If the suit is successful, then the proceeds go to the

corporation

Shaffer v. Heitner

--Facts

Greyhound, a Delaware corporation, lost a large antitrust judgment

in Oregon. Greyhound was fined a lot of money, and so the

shareholders’ stocks lost interest and value.

(P) Heitner is a non-resident of Delaware; he initiated a shareholder

derivative suit in Delaware state court on behalf of Greyhound

against 28 officers and directors of the corporation (i.e. Shaffer, D).

o Heitner owned one share of Greyhound stock. Heitner filed a

motion for sequestration of stock owned by 21 of the 28

defendants in order to obtain quasi-in-rem jurisdiction.

o Heitner sued in Delaware because of the actions of the

directors and officers, not because of its location or property.

o The legal status of the stock was deemed to be in Delaware.

The Delaware sequestration statute allowed property within the

state to be seized to allow the Delaware court to obtain in rem

jurisdiction over the owner.

(D)s made a special appearance to challenge the court’s jurisdiction

on the grounds that the statute was unconstitutional. (D) also

asserted that there were insufficient contacts to confer jurisdiction.

The District Court found that the statute was valid, and did not

address the minimum contacts argument due to the finding that the

legal presence of the stock in Delaware conferred quasi-in rem

jurisdiction.

o They served notice of the suit by certified mail to the old

addresses of the officers, and by publishing notice of the suit

in a newspaper.

--Issues = this case deals with individuals, NOT corporations.

In order for the forum state to exercise in rem jurisdiction on a

nonresident, must the nonresident have minimum contacts with the

forum state? Or is property alone enough to confer jurisdiction?

If so, must the cause of action be sufficiently related to the contacts

the nonresident has with the forum state?

--Holding and Rule (Marshall) = The previous judgment is reversed for lack of

jurisdiction over the defendants

A state cannot obtain PJ over a party based merely on that party’s

ownership of property in the state. Quasi in rem jurisdiction is

subject to the constitutional requirements of minimum contacts.

--Rules & Reasoning

Whether or not a State can assert jurisdiction over a nonresident

must be evaluated according to the minimum-contacts standard

from International Shoe.

In rem jurisdiction: due process under the 14th Amendment requires

that the basis for jurisdiction must be sufficient to justify exercising

jurisdiction over the interests of persons in the thing.

o The presence of property in a state may allow jurisdiction by

providing contacts among the forum State, the defendant,

and the litigation, but there are exceptions.

In this case, the property serving as the basis for jurisdiction is

completely unrelated to the plaintiff’s cause of action. The presence

of the property alone would not support the State’s jurisdiction.

Appellants’ holdings in the corporation do not provide contacts with

Delaware sufficient to support jurisdiction of that State’s courts over

appellants.

o Just because you have property in a state does not mean that

state can hold jurisdiction over you; you must have minimum

contacts for fair play and substantial justice – International

Shoe applies to in rem and quasi in rem jurisdiction plus in

personam jurisdiction.

Delaware is not a fair forum for this litigation because the officers

and directors have never set foot in the state and have not

purposefully availed themselves of the benefits and protections of

the state.

--Concurring (Powell)

The principles of minimum contacts is appropriate for in rem and

quasi in rem suits. The stock in Delaware and the officers’ positions

in the company do not constitute minimum contacts.

However, he’s not sure if ownership of real property within a state

can constitute minimum contacts for jurisdiction purposes.

--Concurring (Stevens)

One who purchases stock shares on the open market can hardly be

expected to know that he has thereby become subject to suit in a

forum remote from his residence and unrelated to the transaction.

However, this judgment may have further reaching principles that

are necessarily correct in the law.

--Concurring in Part and Dissenting in Part (Brennan)

The use of minimum contacts is more than justified and it

represents a sensible approach to the exercise of state court

jurisdiction, however the majority’s approach to minimum contacts

is wrong in this case = (D)s had minimum contacts.

As a general rule, a state forum has jurisdiction to adjudicate a

shareholder derivative action centering on the conduct and policies

of the directors and officers of a corporation incorporated in that

State.

Greyhound’s choice of incorporation in Delaware is a prima facie

showing of submission to its jurisdiction. There was a voluntary

association with the State of Delaware invoking the benefits and

protections of its laws. The majority opinion is purely advisory once

it finds that the state statute is invalid.

--Significance = this eliminates in rem jurisdiction!!!

--Could Heitner bring suit in AZ? Heitner would have to argue minimum

contacts there as well.

NOTE: Having property in a state does not give the state jurisdiction

over causes of action unrelated to the property unless the person

also passes the minimum contacts test articulated in the

International Shoe decision.

If it is unconstitutional to exercise jurisdiction over the person

directly then it should be unconstitutional to assert jurisdiction

indirectly.

The presence of property alone would not support jurisdiction

absent other ties to the state if the action does not arise from the

property OR that the property shows minimum contact

Notes and Problems

1.

2. A) The court did not decide that the property was irrelevant to the

existence of jurisdiction because property can show contact. Property

ownership alone is not the test for existence of jurisdiction. B) The court did

not hold that stock is not property because you can get minimum contact

through stock – but having stock alone is not the test for jurisdiction. C) The

directors can be sued in the state where the corporation is located because

they can make contact through the corporation – meetings in that state, etc.

can serve as minimum contact. D) The court never said that the board of

directors had not consented to being sued – they only looked to see if the

Delaware statute was constitutional according to the Due Process clause. E)

The court only said that attaching property is only unconstitutional when

there are no minimum contacts in the forum state where the property lies –

attaching property does not equal jurisdiction alone.

3. Hypo variation from class:

Sylvester, resident of LA, has inherited property from the will of a

distant relative in Idaho. Noel, a resident of TN, sues Sylvester in

Idaho based on injuries from a car accident that took place in LA,

and Noel attaches the newly acquired Idaho property. QUASI IN

REM – trying to get jurisdiction over Sylvester by the

ownership of the property

o Likely not to satisfy the minimum contacts requirement

o Sylvester only has contact because of the property, and the

action does not rise out of the incident (incident takes place in

LA, and she’s from TN so she does not have a great interest in

taking the suit to Idaho).

o Sylvester could file an answer in Idaho to this suit not

consenting – however, if she did not answer or object to the

litigation, then she consented to the jurisdiction of the Idaho

court. Presence in the forum state can equal consent.

o What happens if she tried the case in a court that had

jurisdiction over Sylvester, and the judgment is handed down

in favor of Noel… then in order to get the debt paid back to

Noel, could Noel try and get a hold of the Idaho property?

Sylvester’s property in Idaho has a huge hole from a previous

attempt to dig a pool – a little boy falls in the hole, and brings suit

against Sylvester to take the property. IN REM – the suit comes

out of the ownership of the proerty

o Her contact is that she owns the property there, even thought

she has never been to Idaho – the court could have

jurisdiction because Idaho is where the incident took place

because of her property in Idaho (reason for action came from

her contact in Idaho).

o Also if something were to take place to Sylvester’s property,

like a fire, then Sylvester would need the benefits and

protection of Idaho for her property.

o All the witnesses to the incident are in Idaho.

4. States can asserts jurisdiction over officers of a company that is

incorporated in its state through a statute. The statute would mean that the

people taking officer positions in the corporation would be subject to

jurisdiction in that state for actions arising from their corporation or from

actions arising from their position as officers in the corporation.

5. Brennan made the point that courts should take into account the

defendant’s circumstances and the forum state’s interest in the litigation.

However, many courts are not completely decided on this issue.

6.

7. In rem jurisdiction and the Internet. Like other trademarks, Internet

domain names are valuable pieces of intellectual property & legislation

protects them from various sorts of abuse and poaching. Even though a

defendant’s whereabouts are known, the defendant may not be subject to

personal jurisdiction. The defendant can be subject to??

8. Though Shaffer holds that the mere seizure of property does not establish

jurisdiction, parties continue to seize property for other purposes:

To prevent a party from moving assets out of the country pending

litigation, OR to satisfy judgments

9. International Shoe applies to the individuals as well as corporations. In

order for a state to exercise jurisdiction over a person not present in the

state, minimum contacts are necessary. Those contacts may include

ownership of property, but mere ownership of property does not conclusively

establish jurisdiction like it did in Pennoyer.

***RULE: In modern times, Personal Jurisdiction comes from either consent,

presence, or minimum contacts. ***

09/12/11 – pgs. 96-104

3. Specific Jurisdiction: The Modern Cases

Specific jurisdiction – jurisdiction that stems from the defendant’s

having certain minimum contacts with the forum state so that the

court may hear a case whose issues arise from those contacts.

Courts now do not look so much at the rules – they disagree more

about how to apply the rules to any given case (no wrong answer)

Look at the slight differences of the facts of the case to see how

cases could be changed in the decision handed down

World-Wide Volkswagen Corp. v. Woodson [non-resident defendant and

stream of commerce doctrine]

--Facts

The Robinsons purchased an Audi from Seaway (P1), a New York car

dealership. One year later while driving through Oklahoma, another

car hit them from behind, causing a fire which caused severe

injuries to Mrs. Robinson and her two children.

The Robinsons brought a products liability suit in OK state court

against four parties including Seaway and its distributor, World-

Wide Volkswagen (P2).

o These were both New York corporations and conducted no

business in Oklahoma.

The defendants entered special appearances claiming that

Oklahoma could not exert in personam jurisdiction over them by

virtue of the Due Process Clause of the Fourteenth Amendment.

--Procedural History

(Woodson) Trial judge decides Oaklahoma does have personal

jurisdiction over all (P)s

Then (P)s filed a writ of prohibition in the Supreme Court of OK to

restrain the district court judge (Woodson-D) from exercising

personal jurisdiction over them.

o SC denied the writ saying that the trial court was justified in PJ

over (P) because (P) the product sold and distributed is so

mobile that (P) could foresee that it had possible use in OK +

the fact there was one automobile here meant there was most

likely more.

o Also, (P) receives a significant income from sale of the product

in this case, and (P) should have known that their products

were being used in OK

US Supreme Court granted writ of cert.

--Issue = Can a forum state exercise in personam specific jurisdiction over a

party when a product could foreseeably be moved to a different state?

--Holding = Judgment reversed. (Ps) have no “contacts, ties, or relations”

with OK, thus OK lacks jurisdiction over (Ps).

--Reasoning

Minimum contacts is a requirement. There is a TOTAL absence of

the minimum contacts required:

o (P)s carry no activity whatsoever in OK as they close no sales

or perform any services there. They do not avail themselves

of the privileges and benefits of OK law. They solicit no

business in OK through any salesperson or advertising. They

do not sell any cars to OK residents directly.

o The only contact between (Ds) and the forum state is that car

made its way into OK – this is NOT enough.

“Foreseeability” is not a sufficient benchmark for personal

jurisdiction under the Due Process clause. The foreseeability that is

critical to due process is not the mere likelihood that a product will

find its way into a forum state. It is that the (Ds) conduct and

connection with the forum state are such that he should reasonably

anticipate being haled into court there.

Even if the D would suffer minimal or no inconvenience from being

forced to litigate in a particular state and even if the forum state is

the "best" place for litigation, DP can still deprive that state of

taking jurisdiction over a case

--Dissent by Brennan – STREAM OF COMMERCE

Based on foreseeability- a car sold in New York is mobile, and

therefore it was foreseeable by World-Wide and Seaway that a car

sold by them could subsequently lead to an injury in Oklahoma.

However, the majority opinion of the Supreme Court rejected this

argument, saying that foreseeability alone could not provide the

basis for personal jurisdiction over a defendant and the two

petitioning companies had no other contacts with Oklahoma

There is too little weight applied to the strength of the forum State’s

interest in the case.

--Significance = a state does not necessarily have personal jurisdiction over

a corporate defendant simply because its product was brought into the

forum state.

The defendant must have voluntarily connected himself or herself

with the forum state via the notion that it purposely availed itself of

the forum state’s laws.

Here, just because the defendants put a product in the stream of

commerce does not mean that they formed the sufficient contact

with Oklahoma to be held under its jurisdiction. The companies have

used no benefits, nor purposefully availed themselves to the

privileges of conducting business in the stat

--There are two tests for personal jurisdiction: ‘minimum contacts’ and

‘fairness’ (Minimum purposeful contacts)

Minimum contacts = The defendant’s conduct and connection with

the forum State must be such that he should reasonably anticipate

being haled into court there.

The forum State does not exceed its powers under the Due Process

Clause if it asserts personal jurisdiction over a corporation that

delivers its products into the stream of commerce with the

expectation that they will be purchased by consumers in the forum

State = purposely injected products into the stream of commerce.

--Specific Jurisdiction has some different requirements:

Could the defendants reasonably anticipate being brought into a

suit in the forum state ?

Did they have advertise in the state directly so that those residents

would buy their products?

Are traditional modes of fair play and substantial justice being

violated by exercising jurisdiction?

-- Minimum contacts requirement is important because:

It protects parties from the burden of litigating in foreign judicial

systems, AND

To ensure that states, through their courts, are not reaching over

other states and walking on other state’s sovereignty

Hypo from Note 2: Test for “fair play and substantial justice”

Robinsons bring liability suit against NY retailer, Cali distributor, and

Japanese manufacturer of the defective radio component part. Who

is subject to personal jurisdiction?

If there are minimum contacts, what about test for “fair play and

substantial justice?”

o 1) Burden on defendant

o 2) Forum state’s interest in adjudicating the dispute

o 3) Plaintiff’s interest in obtaining convenient and effective

relief

o 4) Interstate judicial system’s interest in obtaining the most

efficient resolution of controversies, AND

o 5) Shared interest of several states in furthering fundamental

substantive social policies

Distributor – they have the minimum contacts and they file some

requirements from fair play and substantial justice

Notes and Problems

1. Principle of Stream of Commerce if the sale of a product of

manufacturer or distributor is not simply an isolated occurrence but arises

from the manufacturer’s or distributor’s efforts to serve either directly or

indirectly other states’ markets, it is not unreasonable to subject it to suit in

one of those states if its merchandise has caused injury to residents there.

2.

3. For most US defendants, there is some type of jurisdiction in a court –

state where the defendant is permanently domiciled, or state where the

company is incorporated.

4.

5.

09/13/11 – pgs. 105-117

Asahi Metal Industry v. Superior Court [foreign defendant & stream of

commerce doctrine] – split decision!

--Older Facts

Zurcher lost control of his motorcycle one day and collided with a

tractor; the accident resulted in severe injuries for Zurcher and the

death of his wife. Zurcher filed a products liability suit in Superior

Court of Cali, where he claimed that the back tire was defective and

caused the accident. He filed suit against Cheng Shin [the

Taiwanese manufacturer]

Cheng filed a 3rd party complaint seeking indemnification from (P)

Asahi Metal Industry [Japanese manufacturer of the tire valve].

o Indemnification – an action of compensation for loss or

damage sustained

Zurcher’s suit was later settled and dismissed, leaving only Cheng’s

indemnity action against Asahi

--Facts for present case

(P) moved to quash Cheng’s service of summons stating that it was

inconsistent with Due Process clause in 14th amendment

o (P) is a Japanese corporation who does business with Cheng

and several other tire manufacturers. Cheng’s business

transactions with (P) served for about 1% of its income.

Cheng officials maintain that Asahi had been aware that Cheng’s

tires were sold all over the US; however, (P)’s officials maintain that

they were not aware that they would be held liable for US lawsuits

since they only sold valves to Cheng.

--Procedural History

The Superior Court of Cali denied the motion to quash the service of

summons, stating that (P) clearly does business on an international

scale – thus it is not unreasonable that they defend claims of defect

in their products sold.

The Court of Appeals issued a writ of mandamus to the state of

California telling them to quash the summons. Then the Cali

Supreme reversed this decision, which lead (P) to appeal to the

United States Supreme Court

--Issue = Does a foreign company’s mere awareness that its product is sold

and delivered into the US constitute the minimum contacts needed for

jurisdiction according to rules of fair play and substantial justice?

--Holding = Judgment is reversed and remanded down for further

proceedings. The service summons was later quashed.

--Rules

World Wide Volkswagen – court rejected the assertion that a

consumer’s unilateral act of bringing the defendant’s product into

the forum state was sufficient constitutional basis for jurisdiction

over the defendant

--Reasoning

(4/9=plurality) Part II-A: Minimum contacts! There must be a

“substantial connection” between the defendant and forum state to

fill the “minimum contacts” requirement. In accordance with Due

Process, the connection must come about by defendant’s action

purposefully directed toward the forum state.

o (D) cannot be constitutionally brought under Cali jurisdiction

unless he makes a direct intended effort to serve the market

of the forum state – like advertising in the state,

manufacturing specific parts for the state, etc.

o The placement of his product in the stream of commerce does

not constitute minimum contacts or an action purposefully

directed at Cali = NO jurisdiction

o Mere foreseeability or awareness that a product may end up

in the forum state does not constitute enough constitutional

basis for a court to exercise jurisdiction over a defendant

*VERY IMPORTANT!*(8/9 = precedent through Majority) Part II-B:

Courts must consider the burden on the defendant, the interests of

the forum state, and the plaintiff’s interest in obtaining relief + the

interstate judicial system’s interest in obtaining the most efficient

resolution & the shared interest of several states in furthering

fundamental substantive social policies

o Looking at those factors, Cali’s jurisdiction over (D) would be

unreasonable and unfair in accordance with due process:

1) There is a heavy burden on (D) to appear across the

world to litigate and submit itself into a foreign nation’s

judicial system;

2) there are very slight interests for (P) and the forum

state since (P) isn’t even a resident of Cali; and

3) (P)’s purchasers of its product will place pressure on

(P) because the purchasers can be held liable for tort

action in US + “Great care and reserve should be

exercised when extending PJ internationally”

(4/9 = plurality) Part III: The facts of the case do not establish

minimum contacts so that exercise of personal jurisdiction is

inconsistent with fair play and substantial justice

--Evaluation

There is only a plurality in some parts, which means those parts of

the case do NOT give precedent [unless there is a majority]

--Concurrence in part by Brennan, White, Marshall, and Blackmun

While they all agree with the outcome of the case based on

unreasonableness and unfair to place (P) under jurisdiction, they all

disagree with the how the application of minimum contacts test &

the conclusion that (P) did not purposefully avail itself of Cali

market. This is a very rare case where jurisdiction is NOT

appropriate because it would unfair and unreasonable.

Brennan stated that (P)’s injection of its product into the stream of

commerce constitutes minimum contacts.

--Concurrence in part by Stevens, White, and Blackmun

While they all agree with the conclusion of the case, they do not

agree with the minimum contacts application for 2 reasons.

First, the test for minimum contacts is not necessary because

applying jurisdiction over (P) would be unfair and unreasonable.

Second, if the test for minimum contacts should be applied here,

then it is misapplied to the facts of the case. “Mere awareness” and

“purposeful availment” are closely related here – (P) has engaged in

conduct that constitutes more than simply placing its product in the

stream of commerce; plus (P)’s financial gains should be taken into

account here.

--MY ARGUMENT! = (D) did not market his tire valves in the area – these Cali

residents are buying cars, not tire valves; also (D)’s financial income from

(P)’s purchase of their parts is NOT very large.

Notes and Problems

4. Volvo [Swedish car maker] is partly owned by General Motors. Volvo buys

brakes components from BrakeCo [US manufacturer in Illinois]. Volvo has

national distributor in New Jersey & dealers throughout the US. (P) buys a

Volvo in FA, but the brakes fail and injury ensues. (P) brings suit against

everyone except General Motors. Who does court have jurisdiction over?

A) Volvo – they purposely avail themselves because they have a

National Distributor who sells their cares all over the nation. We

would want to know if Volvo has repair shops for cars in Florida.

B) BrakeCo – based on Asahi, they might not have jurisdiction. We

would want to know how much business they did with Volvo + if

they advertised their brakes in Florida. If these are the brakes sold

to Volvo, then these would also be the brakes sold in the Volvo

stores – thus they would avail themselves through Volvo because

they knew their products would be in Volvo separately.

C) National Distributor – they have purposefully availed themselves

in terms of contacts because they reached out “nationally.” There

wouldn’t be a big burden on the (P) because they bought the car in

Florida; there wouldn’t be a big burden on (D) because they reached

out nationally to sell the cars.

D) Dealer – yes they are selling cars in Florida.

**Specific Jurisdiction – only going to be if the particular incident arises out

their contacts with that state. Thus the brakes caused the accident so it

arises out the contact; however, with an employment dispute over the way

the business is run, there would be no jurisdiction in other states because

the incident arose out of Illinois

***Question: who has to prove right of a court’s jurisdiction? Does the

defendant have to prove that the court does not have jurisdiction? This all

seems very discretionary!***

Plaintiff has the burden to prove that jurisdiction exists!!!!!

Burger King v. Rudzewicz

--Facts

Rudzewicz (D) and MacShara entered into a franchise contract with

Burger King. (P) would open a restaurant in Michigan. Burger King

was incorporated in Florida and incorporated a choice of law clause

in the contract – Florida law would control all possibly lawsuits. The

contract allowed (D) to use Burger King’s trademarks and service

marks for 20 years in Michigan.

An economic downturn led to decreased sales and (D) failed to

meet his obligations under the contract.

--Procedural History

Burger King brought a diversity suit against (D) in Florida. (D)

moved to dismiss for lack of personal jurisdiction because they did

not have sufficient contacts with Florida.

The trial court denied (D)’s motion and ruled that jurisdiction was

proper under Florida’s long arm statute. The court entered

judgment in favor of Burger King and (D) appealed.

CoA held that while (D) had sufficient contacts with the state of

Florida to satisfy the state’s long arm statute, the exercise of

personal jurisdiction was fundamentally unfair and was a violation of

due process. Burger King appealed.

--Issues = To what extent can a contract with a choice of law clause

constitute a contact for the purposes of due process analysis and minimum

contacts analysis?

--Holding and Rule (Brennan)

The court held that jurisdiction is proper when contact with the

forum state proximately results from actions by the defendant such

that they create a substantial connection with the forum state.

There must be fair warning to a defendant that he can be brought

under lawsuit in the forum state. The fair warning requirement is

satisfied when a party has purposefully directed his activities at the

forum. Parties who reach out and create continuing relationships

and obligations in another state are subject to regulation and

sanctions in that state for the consequences of their activities.

The court held that in this case the franchise agreement with Burger

King allowed (D) to benefit from an association with a Florida

corporation for twenty years. (D) had continuing and direct contacts

with Burger King.

o Thus thee fact that (D)’s contacts were purposeful allowed the

state to exercise personal jurisdiction despite that those

contacts were minimal.

The contract indicated that Florida law would apply. It cannot be a

shock that (P) would sue (D) there for a breach of the contract in

light of the clear contractual terms of the agreement.

--Dissent (Stevens)

It is unfair to require a franchisee to defend a case of this kind in a

forum chosen by the franchisor. Rudzewicz did no business in the

state of Florida. His principal contacts were with the Michigan BK

office. Rudzewicz had a local operation with far less resources than

Burger King. It would be fundamentally unfair for Rudzewicz to be

required to defend in Florida.

Note: It is important to remember that the contract had choice of

law clause, but not a forum selection clause.

--Significance = even though the contacts in this case are very slight and

would not constitute jurisdiction alone, the test for jurisdiction that falls

under Due Process [reasonable and fair] can serve to establish jurisdiction.

09/17/11 – pgs. 117-122

Pavolich v. Superior Court [sliding scale and effects test for Internet sites]

--Facts.

(P) Pavolich, a resident of Texas, was the founder and project leader

of the website LiVid. The site consisted of a single page with text

and links to other websites. The site only provided information; it

did not solicit or transact any business and permitted no interactive

exchange of information between its operators and visitors.

Consistent with these efforts, LiVid posted the source code of a

program named DeCSS on its Web site as early as October 1999.

DVD Copy Control Association, Inc. was the manufacturer of DeCSS.

DVD Copy is organized under the laws of Delaware with its principal

place of business in California.

--Procedural History

DVD sued (P). In its complaint, DVD Copy alleged that Plaintiff

misappropriated its trade secrets by posting the DeCSS program on

the LiVid Web site.

In response, Plaintiff filed a motion to quash service of process,

contending that California lacked jurisdiction over his person. The

trial court denied Plaintiff’s motion, and this appeal followed.

--Issue = Can a state court exercise jurisdiction over a non-resident whose

only connection to the state is an internet posting?

--Holding = Reversed. Jurisdiction was improper.

--Reasoning

Specific jurisdiction = no contacts. (P) does not reside or work in

Cali. (P) has not solicited any business in Cali or has no business

contacts in Cali. At the time LiVid posted DeCSS, (P) did not know

that the organization manufacturing DeCSS was DVD Copy.

o Website must be interactive to show contact with state, and

(P)’s website was merely passive.

Merely asserting that a defendant knew or should have known that

his intentional acts would cause harm in the forum state is not

enough to establish jurisdiction. Instead, the plaintiff must also point

to contacts that demonstrate that the defendant expressly aimed its

tortious conduct at the forum.

Specific jurisdiction requires more than a finding that the harm

caused by (P) is primarily felt within the forum. Jurisdiction over him

must be both reasonable and foreseeable so that it does not violate

substantial notions of justice and fair play.

--Dissent. Baxter, J. dissented.

By intentionally posting an unlicensed decryption code of DVD

Copy’s product on his website, (P) was not merely aiming his

conduct at specific persons or companies, but an entire industry.

Since (P) knew that at least two of the industries companies were

located in Cali, his tortuous conduct could be said to be aimed at

the forum state.

--Sliding Scale for Internet Sites

The likelihood that personal jurisdiction can be constitutionally

exercised is directly proportionate to the nature and quality of an

entity’s commercial activity over the Internet.

This is based on a determination of the website's "interactivity"

o The greater the commercial nature and level of interactivity

associated with the website, the more likely it is that the

website operator has purposefully availed itself of the forum

state's jurisdiction.

Interactivity is measured through an examination of the website's

features and intended uses.

o Websites designed to facilitate or conduct business

transactions will often be characterized as interactive.

o A passive website that simply makes the information available

to the user will be less likely to have a basis for personal

jurisdiction.

Websites are effectively divided into three categories:

o 1) websites that conduct business over the Internet,

o 2) websites where users exchange information with the host

computers, and

o 3) websites that do little more than present information

NOTE: Websites that do business over the Internet will yield a

finding of purposeful availment, while websites that simply present

information will not.

--Effects Test [deals with an intentional act!]

This test comes from Calder v. Jones. This deals with cases where

there are insufficient interactivity or minimum contacts, but where

an action is targeted at a particular forum.

In Calder, a Cali resident in the entertainment business sued the

National Enquirer, located in Florida, for libel based on an allegedly

defamatory article published by the magazine.

o Personal jurisdiction was properly established in Cali because

of the effects of the defendants' conduct in that state. Since

the article concerned a Cali resident with a career in Cali and

relied on Cali sources, the Court found the defendants’ actions

were expressly aimed at Cali.

In the Internet context, the effects test can be used to examine the

exact nature of a defendant's Internet activities to determine

whether its out of state actions were directed at parties or entities

within the forum state.

This is referred to as "purposeful direction," which requires

o (a) an intentional action, that was

o (b) expressly aimed at the forum state, with

o (c) knowledge that the brunt of the injury would be felt in the

forum state.

If a court finds that a defendant's actions meets the standard of

purposeful direction, then personal jurisdiction may be asserted

based on Internet activities which do not meet the requirement of

interactivity or minimum contacts needed for personal jurisdiction.

Notes and Problems

1. Yes the court did reach the correct verdict because (P) did not profit from

anything on his website – he was simply spreading knowledge.

2.

09/19/11 – pgs. 122-127

4. General Jurisdiction

This jurisdiction is a court’s authority to hear all claims against a

defendant at the place of defendant’s domicile or place of service.

There is no need to show an existing connection between the claims

and the forum state.

For general jurisdiction over a corporation, there must be evidence

of company incorporation or principal place of business in forum

state trying to exercise jurisdiction

o Example: General Motors, incorporated in Delaware and with

its principal place of business in Michigan, can be brought

under suit in either state

o **However, courts tend to be very weary of granting general

jurisdiction because then potentially a corporation could be

sued anywhere they do business!

For general jurisdiction over individuals, the suit can be brought in

the state were the person is domiciled

Perkins v. Benguet Consolidated Mining Co.

--Facts:

(D) had been operating a continuous and systematic, but limited

part of its business in OH. (D) was served while in OH.

(P) sued (D) in OH for dividends owed and failure to issue stock

certificates to her. However, the cause of action did not arise in OH

and does not relate to any business activities in OH.

--Procedural History:

Trial court found for (D). OH CoA affirmed judgment for (D). OH

Supreme Court affirmed judgment for (D).

US Supreme Court granted writ.

--Issues = Can a state exercise jurisdiction over a foreign corporation when it

is served in the forum state in accordance with Due Process?

--Holding = A court can exercise jurisdiction in this way. Vacated and

remanded down for further proceedings.

--Reasoning

A state may exercise jurisdiction over a foreign corporation, even

when the cause of action does not arise in the state or relate to any

of the corporation's activities in the state, if the corporation carries

on continuous and systematic corporate activities in that state –

general jurisdiction.

The president (also GM and principal stockholder in company)

returned to his home in OH during a war in the Philippines (where

company was based). While in OH, he maintained an office and did

many things on behalf of the company. He kept office files, carried

on correspondence relating to the business and its employees, drew

and distributed salary checks, maintained bank accounts that

contained company funds, held director's meetings, etc.

o Thus, he carried on in OH a continuous and systematic

supervision of the company.

Helicopteros Nacionales de Colombia, S.A. v. Hall

--Facts.

(P) Helicopteros is a Colombia corporation that provides helicopters

for oil and construction companies. (P) was hired by Consorcio and

its Texas venture.

One of (P)’s helicopters crashed in Peru, killing four of the venture’s

employees. (D) employees brought this wrongful death action

against (P) in Texas.

--Procedural History

The trial court denied (P)’s motion to dismiss for lack of in personam

jurisdiction. There was a jury trial and verdict for (P).

Heli then appealed. Texas CoA reversed the judgment for lack of

jurisdiction. The Texas Supreme Court reversed the CoA judgment

on the grounds that the Texas long-arm statute can reach as far as

the Due Process Clause will permit.

(P) then appealed to US Supreme Court

--Issue = If the cause for lawsuit does not arise from a defendant’s contacts

with the forum state, what constitutes “continuous and systematic” contacts

to confer general jurisdiction?

--Holding = There is no jurisdiction over (P) so judgment is reversed.

--Reasoning and Rules

General jurisdiction is reviewed here – Heli must either be

incorporated in Texas, have its principal place of business in Texas,

OR some approximation of business is in Texas.

Facts: (P) conducted some contract negotiations in Texas, bought

80% of its helicopters for the business in Texas, received “technical

consultation” from a person in Texas, and was paid with checks

drawn on a Texas bank.

These are not a sufficient contacts to justify general jurisdiction

under precedent that mere purchases are not sufficient contacts.

o If the purchase is not related to the action, or if it can’t be

proved that it enhanced the nature of Defendant’s contacts

with Texas, it is not sufficient.

09/25/11 – pgs. 127-134 + BB case

Gator.com Corp v. L.L. Bean, Inc.

--Facts

--Procedural History

--Issue

--Holding

--Rules

--Reasoning

--Policy

Burnham v. Superior Court

--Facts

(P) Burnham is a New Jersey resident. (P) was married to a woman,

but they decided to divorce. Before divorce, wife moved to Cali with

kids. (P) filed for divorce in NJ on grounds of desertion – but,

previously (P) and wife had decided to filed for divorce under

“irreconcilable differences.”

(P) visited Cali on business, after which he went to visit his children

where his wife resided. Upon returning the children to his wife’s

home, (P) was served with a Cali court summons because his wife

filed for divorce there.

--Procedural History

(P) made a special appearance in Cali for the purpose of filing a

motion to dismiss on the ground that service was not proper

because the court lacked personal jurisdiction over him.

The Superior Court denied the motion stating that “systematic and

continuous contacts” only applies to corporations.

US Supreme Court granted certiorari.

--Issue = Can a state court apply jurisdiction over a non-resident who was

personally served with process while temporarily in that state, in a suit

unrelated to his activities in that state in accordance with Due Process?

--Holding = Affirmed, Cali has jurisdiction.

--Rules & Reasoning

Scalia, Chief Justice, Kennedy, & White

o Jurisdiction based on physical presence alone constitutes due

process because it is one of the continuing traditions of our

legal system that define the due process standard.

o The contacts & traditional notions of fair play and substantial

justice only came about because of situations where the other

person is not present in the state.

Brennan, Marshall, Blackmun, and O’Connor

o Physical presence in a state permits jurisdiction not because

service of process occurred on the person in the state, but

because by voluntarily coming into the state, the defendant

avails himself of the benefit and privileges of the law of the

state, even if only for a short period of time.

Stevens – he was the swing vote

o This was a very easy case to decide given the historical

evidence and considerations of fairness.

--Policy

An individual’s physical presence in a state at the time process is

served upon them satisfies traditional notions of fair play and

substantial justice.

Seems a little lopsided comparing individuals & corporations – if

someone is physically present in a state, then that state

automatically has jurisdiction; if a corporation does thousands of

dollars of business over the internet with a state, that state may not

have jurisdiction

The strongest argument is that an individual is under his own

control, whereas a corporation cannot control every single one of its

agents and workers from going anywhere

The individual chooses to go somewhere on his own, whereas

workers and agents of a corporation go places without actually

representing the corporation (representing himself individually)

**Make a chart for specific jurisdiction and general jurisdiction**

General Jurisdiction

o “At home” jurisdiction

o Continuous and systematic contacts

Specific Jurisdiction

**Physical presence is supposed to be “general jurisdiction” but it kind of

falls between specific and general jurisdiction because it doesn’t really fit

into either category very well

This only applies if you voluntarily enter the forum state – you

can’t be thrown into the trunk of a car and taken to that state to be

served

Process immunity – if you end up entering the state after being

served, then you have submitted to jurisdiction

09/27/11 – pgs. 134-140

C. Consent as a Substitute for Power

A defendant can consent to jurisdiction in a forum either before the

lawsuit or during the outset of the lawsuit

o Contacts in a state DO NOT constitute consent to jurisdiction

Consent is normally used by parties in cases where there was a

prior contractual dealing

National Equipment Rental v. Szukhent – when (D)s defaulted on

their contract, a clause on the back of the contract was held as

“consent” because it stated that someone in the forum state would

serve as the agent for service of process

o The jurisdiction in the forum court most likely would not have

held without the clause on the back of the contract

NOTE: Federal courts have jurisdiction over admiralty matters,

which include the interpretation of contracts for carriage of

passengers by sea

Carnival Cruise Lines, Inc. v. Shute

--Facts

(D) Shute purchased tickets for a 7-day cruise on a ship owned by

(P) through a Washington travel agent. The face of each ticket

contained terms and conditions of passage, which included an

agreement that all matters disputed or litigated subject to the travel

agreement, would be before a Florida court.

o Forum Jurisdiction clause!!

(D) boarded the ship in Cali, which then sailed to Mexico before

returning to Los Angeles. While the ship was in international waters,

(D) was injured from slipping on a deck mat.

--Procedural History

(D) filed suit in Federal District Court in Washington. (P) filed a

motion for summary judgment, alleging that the clause in the

tickets required (D) to bring their suit in Florida.

--Issue = Should the court enforce the Forum-Selection clause forcing

individuals to submit to jurisdiction in a particular state?

--Holding = Yes. The US Supreme Court held that the CoA erred in refusing to

enforce the forum-selection clause.

--Rules & Reasoning

Forum-selection clauses contained in form passage contracts are

subject to judicial scrutiny for fundamental fairness, but where they

are not lacking in fairness, they will be enforced. This clause passes

fundamental fairness!

(D) consented to the jurisdiction by signing the contract because

they even admit that they knew about the Forum-selection clause in

the contract – even though they didn’t get to negotiate it

(P) had many reasonable causes for having the Forum-Selection

clause included in the contract:

o 1) A cruise line has a special interest in limiting the forums in

which it can potentially be subject to suit – they would have to

travel to several different forums for every incident because

their passengers come from all over the US

o 2) Spares litigants the time and expense of pretrial motions to

determine the correct forum and conserving judicial resources

that would be used in deciding the useless motions

o 3) The clients who pursue these lawsuits are enjoying lowered

fares for cruises by virtue of this clause because it limits the

forums the cruise line can be sued in

--Dissent by Stevens & Marshall.

Adhesion contracts, particularly forum-selection clauses, are void as

contrary to public policy if they were not freely bargained for, create

additional expense for one party, or deny one party a remedy.

--Discussion

Forum-Selection clauses are enforceable in principle. They are not

necessarily enforceable in all situations, but it can be enforced

because it is not unconstitutional in principle – does not violate the

due process clause of US Constitution

Notes and Problems

1.

2.

3.

4. A) Choice of Law clause – the person agreeing to a contract with this

clause is only agreeing to a choice a law. This is not enough to place

somebody under the jurisdiction specified in the clause. B) Consent to

Jurisdiction clause – if the person is brought in suit under that specified

state’s jurisdiction, then he/she will not argue against jurisdiction. However,

he/she can bring suit somewhere else if they choose to. C) Forum Selection

clause – parties are saying that they will be subject to personal jurisdiction

in the specified forum state. They are consenting to jurisdiction through this

clause in the contract.

J. McIntyre Machinery v. Nicastro – no majority!!

**This is a specific jurisdiction case. Requirements to be met:

Minimum Contacts

Suit must arise out of those contacts

Fair play and substantial justice

--Facts

(D) injured his hand in NJ while using a metal-shearing machine.

Machine is manufactured in England by (P), where (P) is

incorporated and operates.

(D) filed this products-liability suit in a state court in New Jersey,

where the accident occurred; (P) then sought to dismiss the suit for

want of personal jurisdiction.

(D)'s jurisdictional claim was based on three primary facts:

o A US distributor agreed to sell (P)'s machines in this country;

o (P) attended trade shows in several states; and

o Four of (P)’s machines ended up in New Jersey.

--Procedural History

(P) moved to dismiss (D)'s products-liability suit arguing lack of

personal jurisdiction. Under the "stream-of-commerce" doctrine, the

Supreme Court of NJ held that due process was not violated by the

NJ court's exercise of jurisdiction.

o Reasoning: The State Supreme Court held that NJ courts can

exercise jurisdiction over a foreign manufacturer without

violating due process so long as the manufacturer knew or

reasonably should have known that its products are

distributed through a nationwide distribution system that

might lead to sales in any of the States.

Certiorari was granted.

--Issue = was NJ Supreme Court correct in handing down judgment that NJ

courts have jurisdiction over (P)?

--Holding = Supreme Court’s judgment is reversed – no jurisdiction.

--Different Judges

Kennedy, Chief Justice, Scalia, & Thomas

o A court may subject a defendant to judgment only when the

defendant has sufficient contacts with the sovereign "that the

maintenance of the suit does not offend 'traditional notions of

fair play and substantial justice” International Shoe. As a

general rule, the sovereign's exercise of power requires some

act by which the defendant "purposefully avails itself of the

privilege of conducting activities within the forum State, thus

invoking the benefits and protections of its laws" Hanson. No

"stream-of-commerce" doctrine can displace that general rule

for products-liability cases.

o (P) did direct activities at the entire US, but this is not

enough! (P) must have engaged in conduct purposefully

directed at NJ, but (P) didn’t (P) had no office in NJ; it

neither paid taxes nor owned property there; and it neither

advertised in, nor sent any employees to NJ. Trial court found

that (P) did not have a single contact with NJ apart from the

fact that the machine in question ended up there.

Brier & Alito Concurs in Judgment, but not ^reasoning

o The outcome of this case is determined by our precedents.

o Based on the facts found by the NJ courts, (D) failed to meet

his burden to demonstrate that it was constitutionally proper

to exercise jurisdiction over (D), a British firm that

manufactures scrap-metal machines in Great Britain and sells

them through an independent US distributor. The Supreme

Court of NJ’s judgment should be reversed.

Ginsburg, Sotomayor, & Kagan dissent

o (P) seeks to develop a market in the US for machines it

manufactures. It hopes to derive substantial revenue from

sales it makes to US purchasers. Where in the US buyers

reside does not matter to (P) – its goal is simply to sell as

much as it can, wherever it can. It excludes no region

or State from the market it wishes to reach. But, it

prefers to avoid products liability litigation in the

United States. To that end, it engages a U.S.

distributor to ship its machines stateside jurisdiction

Basically, do we really want to allow manufacturers to

hide behind distributors for liability?

o (P) knew that they were selling their product in a certain state

to a resident of that state!

Pay attention to Part II’s reasons given on pg. 7!!***

--Significance

The differing opinions here show how the requirements for

jurisdiction can be applied completely different by justices

The signal concurrence says that one single sale does NOT

constitute jurisdiction over a company

This seemingly runs against Volkswagen – maybe (D) could have

given greater evidence for jurisdiction, but (D) didn’t

The difference that may have made this case easier was if (D) had

filed suit against (P)’s US company & then attached the UK

company after OR had gone to the UK to file suit

**14th amendment is in the US Constitution – it protects all people’s right to

due process. Federal Courts go through the same analysis that state courts

use to determine jurisdiction**

Goodyear Dunlap Tires v. Brown

--Facts

(D) NC residents’ sons died in a bus accident outside France filed a

suit for wrongful-death damages in NC state court. Alleging that the

accident was caused by tire failure, they named as (P)s Goodyear

USA [an Ohio Corp] & three Goodyear USA subsidiaries, organized

and operating in Luxembourg, Turkey, & France.

(P)'s tires are manufactured primarily for European and Asian

markets and differ in size and construction from tires ordinarily sold

in the United States. (P)s are not registered to do business in NC;

have no place of business, employees, or bank accounts in the

State; do not design, manufacture, or advertise their products in the

State; and do not solicit business in the State or sell or ship tires to

NC customers. Even so, a small % of their tires were distributed in

NC by other Goodyear USA affiliates.

--Procedural History

The trial court denied (P)'s motion to dismiss the claims against

them for want of jurisdiction. The NC CoA affirmed, concluding that

the NC courts had general jurisdiction over (P), whose tires had

reached the State through "the stream of commerce."

This could NOT be specific jurisdiction because the action that the

suit is based on did not take place in NC, nor does it deal with any

contacts with the state of NC.

--Issue

--Holding

--Decision

A court may assert general jurisdiction over foreign (sister-state or

foreign-country) corporations to hear any and all claims against

them when their affiliations with the State are so "continuous and

systematic" as to render them essentially at home in the forum

State.

o Specific jurisdiction, on the other hand, depends on an

affiliation between the forum and the underlying controversy,

principally, activity or an occurrence that takes place in the

forum State and is therefore subject to the State's regulation.

o In contrast to general jurisdiction, specific jurisdiction is

confined to adjudication of issues deriving from, or connected

with, the very controversy that establishes jurisdiction.

09/28/11 – pgs. 140-154

D. The Constitutional Requirement of Notice

Mullane v. Central Hanover Bank & Trust Co.

--Facts

Central (D) set up common fund pursuant to a New York statute

allowing the creation of common funds for distribution of judicial

settlement trusts. There were 113 participating trusts. (D)

petitioned for settlement of its first account as common trustee.

Some of the beneficiaries were not residents of New York.

“Notice” was by publication for four weeks in a local newspaper.

Appellee had notified those people by mail that were of full age and

sound mind who would be entitled to share in the principal if the

interest they held became distributable.

NY banking law said this was a sound way to serve process to

others – easier to set up a trust and maintain a trust

--Procedural history

(P) was appointed as special guardian and attorney for all persons

known or unknown who had or might have any interest in the

income of the common trust fund.

(P) appeared specially, objecting that notice by publication,

permitted under the applicable statute was inadequate to afford the

beneficiaries Due Process under the 14th Amendment and that

therefore jurisdiction was lacking.

--Issue = Is notice by publication reasonable and proper notice under the

Due Process of the Fourteenth Amendment?

--Holding = Reversed and Remanded because notice given by publication is

insufficient under the Due Process when the parties' addresses are known.

To satisfy due process, the form of notice used must be reasonable

in light of the practicalities and peculiarities of the specific case.

--Rules and Reasoning

There has to be notice and opportunity for a hearing appropriate to

the nature of the case. (P)s could potentially be deprived of

property here, as the proposed disposition cuts off their rights to

sue for negligent or illegal impairments of their interests.

There need not be personal service, notice has to be reasonably

calculated, under all the circumstances, to apprise interested

parties of the pending action and afford them an opportunity to

present their objections.

o You do not have to notify all the beneficiaries when the trust

concerns many small interests. Sending notice to most of

them will protect their interests sufficiently.

o The people not reached would most likely be protected by the

majority that was reached because they would most likely

raise the issues of those who didn’t know about the case

The NY Banking Law violates the due process clause of the 14th

Amendment because contacting beneficiaries by mail at their last

known address is not particularly burdensome.

--Discussion

The majority’s opinion illustrates that notice by publication can be

used, but it will not suffice only because it would be burdensome for

the plaintiff to notify all parties involved.

If the plaintiff knows of a way to contact the parties, then the

plaintiff must bear that expense. Mailing notice to an address, if

known, will suffice.

Notice by publication will suffice only if there is no practical way of

knowing the identity or location of the party.

--In light of the above case, looking back on Pennoyer – Oregon could have

had jurisdiction over Pennoyer. Pennoyer could argue that the notice was not

reasonably calculated.

What if Mitchell states that he has mailed service to Pennoyer’s last

known address & has heard that Pennoyer is hiding to avoid service

in the lawsuit – looking at the above case, it only has to be

reasonably calculated; it doesn’t need to be perfect

Notes and Problems

1.

2.

3. A) What if there are 5 people involved in the trust, and only 4 actually

receive notice of a lawsuit; judgment is entered against the defendants.

What happens now? This is all circumstantial. Courts have stated that there

is a greater obligation to get all 5 notice of the lawsuit because it is less

likely that all 5 will be able to protect each other’s interests and bring up

everyone’s objections. *Mail is not usually held up as proper in court unless it

is proven that those people actually received the mail of process* B) You

would have to look at the cost of service compared to the cost of a judgment

weighed against the defendant – value of a suit vs. cost of service. There is

also the rationale that if you can find somebody for service of process, then

you have to spend whatever money to get to that person. *If you know the

name and address of the person, then notice in a publication is NOT

adequate service or process*

Just keep in mind that Mullane only tells us about how the US

Supreme Court sees the outer bounds of proper service of process.

But Federal Rules of Civil Procedure and state laws deal with their

own legal ways to serve process of people

Rule 4 deals with service of process; it spells out exactly what the

plaintiff must do for correct service of process. Basically says that

mail is OK. *LOOK IT UP*

o Section (d) waiver of service of process tries to lessen the

expenses plaintiffs pay for service of process and extend the

time defendants have to answer the service

o Defendant can’t object to service of process if he waives

service of process – but you can object to jurisdiction

4.

5.

6.

Notes on Service of Process

1.

2. A) She could write a letter, or she could fill out form 5 and include form 6.

She needs to follow rule 4 of FRCP. B) If he ignores it, then he will have to

pay how ever much the cost of service will be. You would advise the client

not to fill out the waiver of process of service under the circumstances that

you believe there is no way the plaintiff can properly serve your client if

plaintiff cannot even serve your client, then there’s no reason to even pay

attention to the complaint. This applies to only a very small amount of cases.

C) When the defendant is in the US, he has at least 30 days to answer with a

waiver of summons [from when plaintiff sends it]. Answering the complaint

will go to 60 days by answering with the waiver [from the original 20 days if

you were actually served].

3.

4. B)

5.

6.

*There won’t be any obscure questions about service or process, just know

the basic principles of service or process!*

Class Notes from 10/3/11

Specific Jurisdiction General Jurisdiction

1. Asses Contacts: purposeful

availment?

--Directed activities or targeted the

forum state

--Enjoy the rights, privileges, and

protection of the forum state

--Effects test

--Sliding scale: internet contacts only;

helps prove whether someone has

purposefully availed themselves

*Expectations are not enough – you

need real actions*

2. Suit arises out of the contacts

3. Fair play and substantial justice –

also known as “Reasonableness Test”

--There are 5 factors to look at when

taking this into account

1. Asses Contacts: continuous and

systematic?

--Corporations can be subject to

jurisdiction where they are

incorporated – make their home [like

an individual]

10/03/11 – pgs. 154-164

E. Self-Imposed Restraints on Jurisdictional Power: Long-Arm Statutes,

Venue, and Discretionary Refusal of Jurisdiction

--There are 3 settings that are also taken into consideration before courts

can exercise jurisdiction:

Long-Arm Statutes,

Venue Laws, and

Doctrine of Forum Non-Conveniens

--Each of the above represents a situation in which the legislature or courts

have framed rules that restrict where a lawsuit may take place – even where

the US Constitution would pose no obstacles

I. Long-Arm Statutes as a Restraint on Jurisdiction

--A court may exercise jurisdiction over a defendant only when the state or

federal government authorizes it to do so & the authorization must be

constitutional as applied to the case in question.

--Because Pennoyer had conceived state court jurisdiction extensions as

near-physical exertions of state power, states authorizing courts to reach

beyond their own borders came to be known as “long-arm” statutes

--States are extending their jurisdictional “arms”

Some states have created long-arm statutes that reach as much

jurisdiction as the Constitution allows

o Example: California – as broad as the jurisdiction powers given

by the US Constitution

Other states have long-arm statutes limiting jurisdiction to specified

occurrences

o Example: Florida – only takes parts of the jurisdiction powers

given by the Constitution

Some states want more power than the Constitution gives to

them

some states only want a little power

US Constitution gives this much

jurisdictional power

*Why would a state want to lessen their power? They may not want to

congest their courts with a ton of cases.

Gibbons v. Brown

--Facts

(P) was driving with (D) and Mr. Brown in Canada in 1994. (P)

allegedly gave faulty directions to Mr. Brown, who was driving. Mr.

Brown ended up driving the wrong way down a one-way street into

a head-on collision that injured both passengers.

--Procedural History

(P) from Texas sued Mr. Brown in Florida. Two years later, (D)

brought this Florida action against (P) to recover for her injuries.

o There was general jurisdiction over Brown in the first suit

(D) alleged that (P) subjected herself to personal jurisdiction of the

Florida court by virtue of having brought the prior lawsuit. (P) filed a

motion to dismiss, claiming that the provisions of (D)’s original

complaint were inadequate to satisfy the Florida long-arm statute.

o (D) argues that (P)’s original suit fulfills that long-arm statute

part because (P) is “engaged in substantial and not isolate

activity” in the state of Florida

--Issue = Does previously availing oneself of a jurisdiction as a Plaintiff

automatically render one subject to jurisdiction later?

--Holding & Decision = No, trail court directed to dismiss (D)’s complaint.

--Rules & Reasoning

Without more, the fact that a current Defendant previously brought

a suit in the forum state does not constitute sufficient activities to

subject the current defendant to personal jurisdiction in the state.

US Constitution gives this much

jurisdictional power

o The only contact she has to the state now is defending the

suit in question here – no other contacts or activities

The length of time between the 2 actions was too long of a gap; (P)

was not involved in the prior suit; and (P) is not engaged in any

other activity in the state besides defending this claim.

--Discussion

The parties agreed that as a general rule in Florida, a Plaintiff, by

bringing an action, subjects herself to the jurisdiction of the court

and to subsequent lawful orders entered regarding the same

subject matter of that action.

However, the Court refused to hold that by filing a lawsuit in 1995,

Plaintiff should have to automatically consent to Florida jurisdiction

when she was named as a defendant in a related lawsuit two full

years later.

*If Mr. Brown file counterclaims against Gibbons, then he most likely could

file it because of efficiency of the courts since it would be the same case with

the same facts affecting it.

*What would happen if Mrs. Brown filed suit against Gibbons in 2 months of

the first suit filed by Gibbons was started? Would Florida have jurisdiction?

*If a court finds that it has jurisdiction over a defendant under long-arm

statutes, it would still need to look at whether that jurisdiction still falls under

the Constitution’s grant of jurisdiction

If the long-arm statute does not include jurisdiction over a defendant, then

Notes and Problems

1.

2.

3. The relation between long-arm statutes and the Due Process clause:

Analytically there are 2 distinct inquiries – the court must first

decide if the long-arm statute includes the current case, and second

the court must decide if asserting jurisdiction was constitutional

Some state’s long-arm statutes appear to be more restrictive than

the Constitution, but that does not mean that the statute is as strict

as the text seems

o Some courts have looked at these statutes and decided that

they encompass more than at first glance

4. The Federal Interpleader Act has given the federal courts the power to

serve process on anywhere in the nation, and this power has been

interpreted to include personal jurisdiction.

II. Venue as a Further Localizing Principle

--Like personal jurisdiction, venue determines where litigation will take place

Unlike personal jurisdiction, venue flows solely from statutory sources rather

than constitutional sources.

General federal statute dealing with venue is 28 USC §1391:

portions (a) & (b) of this statute put venue “where any defendant

resides” or where “a substantial part of the events or omissions

giving rise to the claim occurred”

Unlike personal jurisdiction, venue locates litigation not just in a

state but also in a particular federal judicial district within the state

o If someone is clearly subject to jurisdiction in Florida, there

are 3 different venue of federal judicial districts

The different districts of each state are set out by federal statutes

o States have venue provisions and federal venue provisions

--If you are deciding to bring suit and are trying to figure out what venue is

appropriate, then you can look at the 2 provisions in 28 USC §1391(a).

You may find venue in one place for the first one and another venue

somewhere different in the second one.

Example: Person A wants to bring suit so he looks at a possibly

venue. He finds that he can bring suit against defendant in NY; he

decides that he may not want to bring suit there because the courts

are congested. So he looks at the second provision of 28 USC, and

he finds that he can also bring suit in Vermont.

Notes and Problems

1. A) There is only one defendant so the proper venue could be Southern

District of NY [according to 28 USC § 1391(a)] & maybe even a few others.

2. Since one of the plaintiffs resides in NY and the other does his business in

NY, the venue would be NY BUT we need more info about where the breach

of contract took place and where the contract came from.

3. Southern District of NY would be the most proper because one is the

resident & the other does business (the business side give contacts and

reverts back to Perkins.

4. A) Options include Nevada because that is where the accident took place,

or California because that is where the defendant resides. There would be

personal jurisdiction over defendant because that is where he lives; there

would be specific jurisdiction over the defendant in Nevada because that is

where the reason for suit arises.

B) Options under 28 USC §1391(a) include Canada because the defendant

resides there, Nevada because that is where the accident took place (the

reason for the suit), or really any suit because the defendant is an alien

28 USC §1391(d) says that an alien may be sued in any district.

Venue does open up more options without looking at personal jurisdiction, so

remember that these must work together!

5. The two provisions of the USC 1391 do have very minimal differences, but

they are important to keep in mind.

Dee-K Enterprises, Inc. v. Heveafil Sdn. Bhd.

--Facts & Procedural History

(P)s Dee-K and Asheboro were Virginia and North Carolina

corporations that bought rubber thread from the Defendants to

make bungee cords. (P)s sued a number of corporations producing

the rubber thread, which corporations were located in Malaysia,

Indonesia, and Thailand. (P)s alleged a broad conspiracy among the

(D)s to fix prices and restrain competition in rubber thread.

(D)s challenged jurisdiction and venue.

--Issue = Is there United States personal jurisdiction over the Indonesian

manufacturer that consummates its sales of thread in Indonesia?

Is venue proper in the Eastern District of Virginia?

--Holding & Decision = Maybe, need more info!

Yes. The Supreme Court of the United States held that due process

was satisfied by the Defendants’ appointment of exclusive U.S.

sales agents and its customizing of its products for the U.S. market.

Yes. The Supreme Court has held that aliens may be sued in any

federal judicial district.

o USC §1391(d) covers only the alien defendants, but we still

have the defendants who are from USA

Foreign defendants can be sued anywhere (aliens). Some of the

contacts of American defendants are sparse and some seem to be

located in the western district rather than the eastern district.

--Discussion

Students should realize here that the mere fact that a Defendant is

a foreign corporation does not automatically escape Federal court

jurisdiction.

The Supreme Court points out that FRCP 4(k)(2) provides that a

Defendant who is not subject to the jurisdiction of any state court

that is served with process is subject to personal jurisdiction in the

Federal courts as long as the assertion of jurisdiction is consistent

with federal law and does not offend the US Constitution.

Thus, so long as the actual method of service of process complied

with existing federal law, jurisdiction over a foreign corporation is

appropriate where the Constitutional test of fair play and substantial

justice in asserting jurisdiction is satisfied.

10/09/11 – pgs. 164-171

III. Declining Jurisdiction: Transfer and Forum Non-Conveniens

Both state and federal courts may decline to exercise jurisdiction

even though they possess it. As more and more cases are filed &

courts become backed up with them, more courts have exercised

the power to decline to exercise jurisdiction

If a case is brought into an improper district, then the court can

transfer the case to another judicial district; however this transfer

only takes place in the Federal District System (see Piper case)

o The court can either dismiss the case for improper jurisdiction,

or may transfer the case to another venue

Forum Non Conveniens case is dismissed (but under the

assertion that the case will be moved to a foreign court system)

o Forum Non-Conveniens is a common-law doctrine, NOT a

statute so it does not apply to Louisiana

o If a case is dismissed this way in federal court, it is normally

so the case can be filed in another country. If a case is

dismissed this way in state court, it is normally so the case

can be refilled in another state.=

Transfer under 28 USC §1404, 1406, 1631 – this only applied to

federal courts and it allows the federal courts to move cases around

the country for “the convenience of parties and witnesses in the

interest of justice”

o While reading Piper, take notice that (D)s first removed to

federal court and then sought transfer to a different judicial

district under §1404

o §1404 permits transfer for “convenience of parties and

witnesses in the interest of justice” – it gives federal courts

the ability to move cases within the system without have to

dismiss and re-file

Both of these dismissals come about in circumstances where the

court has the power to exercise jurisdiction, but for reasons of

justice or efficiency, the court decides not to

A. Piper shows the doctrine of forum non-conveniens.

B. Transfer under 28 USC §1404, §1406, and §1631

Transferring a case under §1404 gives the federal courts the ability

to move cases within the system without the necessity for dismissal

and refilling, which would be necessary under the doctrine of forum

non conveniens

§1406 allows transfer from a district where the venue is improper. It

also allows dismissal.

§1631 allows transfer to another court when the original court lacks

jurisdiction. The transferred action relates back to the original date

of filing however.

§1407 applies to the pre-trial motions and actions, and it halts once

the trial begins. This deals with consolidating claims and suits for

efficiency – there is no reason for multiple courts to decide the

same motions and actions for the same case.

Piper Aircraft v. Reyno

--Facts

A small commercial plane crashed in Scotland killing its five

passengers and the pilot.  The decedents and heirs are all

Scottish. There were no eyewitnesses. The aircraft was

manufactured in PA by (P) Piper. The propellers were manufactured

by (P) Hartzell in OH. The aircraft was own and operated by UK

companies. 

A British report indicated that pilot error may have contributed to

the crash.  The pilot only had his license for three months prior.  A

CA probate court appointed (D) Reyno as administratrix of the

estates of the passengers. She was legal secretary of their

survivor’s attorney.

--Procedural History

(D) filed action in CA state court; (Ps) both removed to Federal

District Court in CA because of diversity of citizenship. (P-Piper)

sought transfer to Middle District of PA under §1404 because that is

where he does business. (P-Hartzell) motioned for dismissal for lack

of personal jurisdiction OR transfer for the same reason as Piper.

o 28 USC §1404(a) – transfer of venue. For the convenience of

parties an witnesses, in the interest of justice, a DC may

transfer an civil action to any other district or division where it

might have been brought

Court transferred the case. Then both (D)s filed motion to dismiss

on grounds of Forum Non Conveniens. That motion was granted, so

(P) appealed.

PA District Court granted the dismissal stating that the chosen

forum would force oppression against defendant and would be an

inappropriate forum because of court’s legal problems.

(D) appealed. CoA reversed because dismissal based on Forum Non

Conveniens is never appropriate where law in alternative forum is

unfriendly to plaintiff. US Supreme Court now reviews

--Issue = Can a plaintiff defeat a motion to dismiss on ground of forum non

conveniens by showing that the substantive law that would be applied in the

alternative forum is less favorable to him than that of the chosen forum; and

Is it unreasonable to dismiss a case based on fewer evidentiary

problems that would be posed if the trial were held in a different

forum, if that other forum would not be as favorable to the plaintiff?

--(D-Reyno)’s argument

American citizens have an interest in ensuring that US

manufacturers are deterred from producing defective products &

additional deterrence might be obtained by US trial where they

could be sued on the basis of both negligence and strict liability

--(P-Piper & Hartzell)’s argument

The oppressiveness imposed against (Ds) by forcing them to defend

a case in US courts when all the evidence and witnesses are located

in Scotland is contrary to established law

--Holding = NO, CoA’s judgement is reversed back to DC’s original ruling.

--Rules & Reasoning: When an alternative forum has jurisdiction to hear a

case and when trial in the chosen forum would establish oppressiveness and

vexation to a defendant out of proportion to the plaintiff’s convenience, OR

when the chosen forum is inappropriate because of considerations affecting

the court’s own administrative and legal concerns, the court may in the

exercise of sound discretion dismiss the case by applying the list of private

and public interest factors. In a motion to dismiss for forum non conveniens,

a court should consider both private and public interest factors.

Private factors include the relative ease of access to sources of

proof, availability of a required process for the attendance of

unwilling witnesses, the cost of attendance of witnesses, the

possibility of viewing the scene if appropriate to the action, and

other practical matters related to making the trial easy, expeditious,

and inexpensive.

Public factors include administrative difficulties of the courts,

interest in having local controversies decided at home, the interest

of having the trial in a forum that is familiar with the law governing

the action, the avoidance of unnecessary problems in conflict of

laws or the application of foreign law, and the unfairness of

burdening citizens in an unrelated forum with jury duty.

The court held that private factors favored Scotland because the

wreckage of the plane and witnesses were there. The court also

held that public factors favored Scotland because Scotland had a

greater interesting in hearing a case that concerned Scottish

citizens. The court also held that the fact that Scotland might have

been less favorable to Reyno based on its lack of strict liability for

torts did not provide a reason to dismiss the defendants’ motion.

o Also the interest to hold American companies liable for its

actions and products is far less here than the amount of

resources and time it would take to try the case in the US

--Policy: Courts will honor a plaintiff’s chosen forum normally, but for foreign

plaintiffs because their choice deserves less consideration.

Plaintiffs are now free to re-file in any other jurisdiction, but

Scotland is the clear choice. However, statute of limitations does

affect a case like this so they only have a certain amount of time.

--Why would someone want to litigate in a US jurisdiction over a foreign

jurisdiction?

More familiar with laws of jurisdiction

Laws of jurisdiction would be more favorable to plaintiff

To get a fair trial – US system of litigation is very unique compared

to other places ad most foreigners prefer it

More liberal discovery rules, jury trials are available, etc.

Notes & Problems

1.

2.

3. Reyno now has two basic options – either drop the lawsuit completely or

refile it in Scotland. But what about the statue of limitations? When the

defendant moves to dismissal based on an inconvenient forum, they

normally must agree in advance to waive the statute of limitations defense

in the alternative forum. This also applies to personal jurisdiction – when a

defendant moves for transfer of jurisdiction or venue, the court will require

the defendant to agree to waive jurisdiction or venue defenses in the new

forum. Defendants cannot simply move for dismissal leaving the plaintiff

without any means for relief in these situations.

4.

5. A court more than likely will not have to decide if it actually has

jurisdiction to hear the claim when deciding to grant a motion for transfer or

forum non conveniens.

6. B) Some US courts may refuse to dismiss a case based on the fact that

litigating the case in a foreign court system produces no viable choice for

venue. Most courts will not dismiss a case if there is no other option to

litigate the case.

7. A) Guidu v. Inter-Continental Hotels Corp. The trial court dismissed the

case stating that Egypt would be a better forum to litigate the case because

an Egyptian court would be more familiar with Egyptian laws, Egypt would

properly handle the case based on its commitment to tourism, and there was

already litigation there from other victim’s families. However, the CoA

reversed this stating that the burden on plaintiffs to bring their suit in Egypt

far outweighed the burden on the defendants – US was better forum based

on the plaintiff’s suit.

B) Gonzales v. Chrysler Corp. Even though Mexico is not a viable

venue for this case because of the cap award on the loss of child,

this case was dismissed in US. There is no real remedy here for the

plaintiff, but the court still dismisses because it says that all other

factors do not apply here for case to be tried in US. The court is

setting up public policy here stating that the economic viability to

bring a suit in an alternative forum is not a factor they can take into

consideration because then there would be no real place to stop

when it comes to the $$$.

--Ferrens case is it ethical to follow the plaintiff’s actions?

Strategic lawyering to get an advantage.

There was accident in PN, and case was filed in PN against

defendant for contract. Another case was attempted to be filed

based on tort action, but statute of limitations had run out.

They go searching for another court where they can get jurisdiction

over defendant & where the statute of limitations on tort action has

not run out yet. They find MS where they can file the tort action.

They file the tort action and then file motion to transfer the tort

case to PN according to all public and private interest factors.

Unreasonable burden on (P), (D) is already defending in PN, (P)’s

hospital records are in PN, etc.

After transfer, PN court has no choice in not allowing the transfer

because they are bound by a previous case decision to follow the

laws of MS – statute on tort action comes from MS law

10/12/11 – pgs. 172-184

Notes & Problems

1.

2.

3. There are some key differences between §1404 and the doctrine of forum

non conveniens:

§1404 only applies to federal courts. State courts can dismiss a case

based on the doctrine of forum non conveniens or their own

statutes that resemble §1404. However, state courts lack the power

to transfer a case to another state.

Forum non conveniens can only be used by defendants. Plaintiffs

can seek transfer under §1404.

A district judge has more discretion under §1404 than the doctrine

of forum non conveniens.

4.

5.

Chapter 3: Subject Matter Jurisdiction

A. The Idea & Structure of Subject Matter Jurisdiction

--When looking at personal jurisdiction (first jurisdictional boundary), we are

looking at a court’s power to give a judgment that is binding on the

defendant

Here is a second jurisdictional boundary placed on courts – subject

matter jurisdiction, which deals with the powers of the state and

federal courts

Litigants, lawyers, and judges need to know which kinds of cases

belong in which courts because both state and federal governments

have their own court systems

o Federal courts share most of their jurisdiction with state

courts according to statutes – concurrent jurisdiction

o Concurrent jurisdiction means that a case can be filed in

either a state court or a federal court (depending on statutes

& Constitution)

Article III, §2 limits federal court’s jurisdiction to a list. This implies

that a case not listed in this section may not be heard in federal

court (can only be heard in state court)

o “The judicial power shall extend to all cases arising under

this constitution, the law of the US, and treaties made.”

o Federal courts are exclusive – the only way a case can be filed

in federal court is if it is written in a statute

Rule 8(a) requires every federal complaint to begin with “a short

and plain statement of the grounds for the courts’ jurisdiction”

28 USC §1331 grants federal district courts jurisdiction over cases

that arise under federal law; however, they do not have exclusive

jurisdiction over such cases (can also be brought in state court)

o --Arises under per §1331: “if a well-pleaded complaint

establishes either that 1) federal law creates the cause of

action OR 2) that the plaintiff’s right to relief necessarily

depends on resolution of a substantial question of federal

law”

o “The district courts shall have original jurisdiction of all civil

actions arising under the US Constitution, law, or treaties”

o Explanation: District courts have original jurisdiction of all civil

actions, but its not as broad as the jurisdiction given under

Article III, §2 of Constitution ^^^^

However, federal jurisdiction can also be excusive. Some areas here

are admiralty, bankruptcy, and anti-trusts

This type of jurisdiction matters in several different ways:

o Tactical – federal courts may have shorter waiting times until

trial over their state counterparts

o Strategic – the defendant (or plaintiff) can get more sympathy

from a federal court or a state court, depending on the issue

o Crafty – the opposing lawyer may not fair well with the more

formal and faster pace of federal litigation

Article III, §1 gives federal judges lifetime tenure – this means that

they are protected from political pressure because they don’t have

to worry about re-elections

o Example: a litigant with a legally strong but unpopular claim

or defense might prefer federal court for this reason

Unlike personal jurisdiction, there can be no waive of subject matter

jurisdiction. Even if both parties decide on where to file the suit,

neither party can waive subject matter jurisdiction

--28 USC §1332(c)(2) deals with the legal representative of the

estate or decedent and citizenship.

o The legal representative of a decedent, infant, or incompetent

will be the citizen of the same state as the decedent, infant,

or incompetent.

B. Federal Question Jurisdiction

In the past, unless covered by one of the specific and generally

narrowly drawn statutes, a claim based on the Constitution or a

federal statute could not be brought in federal court

NOW, there is the federal question statute – key provision is that

district courts can have jurisdiction over cases “arising under” the

Constitution, federal statutes, or federal treaties

Definition: the exercise of federal court power over claims arising

under the US Constitution, an act of Congress, or a treaty

--Hypo: person from Minnesota going to Denver. She injures someone from

Colorado in Denver, so where can a suit be filed?

Minnesota – Person is domiciled in Minnesota so definitely general

personal jurisdiction there.

Colorado – the accident took place there so definitely specific

personal jurisdiction there

Proceeding under diversity, Federal Court may also be an option

because both people are from different states.

Proceeding under Federal Question, Federal Court may also be an

option as long as there is a violation of federal statute?

Doctrine Personal Jurisdiction Federal Subject Matter

Jurisdiction

Constitutional Source Due Process clause in

the 14th Amendment

Article III

Statutory Source State and federal long

arm statutes – Rule 4(k)

(1)(A)

Federal jurisdictional

statutes – 28 USC

§1331, §1332, etc.

Effect Limits the power of

state and federal courts

in any given state over

cases involving

particular defendants

Limits power of federal

courts to certain kinds

of cases – those

involving federal claims,

diverse parties, etc.

Pg. 177 diagram

**A case that began in state court and has been ligated all the way through

the state court can make its way to the US Supreme Court if there is a

violation of the US Constitution**

Person appealed will file a writ of certiorari, which US Supreme

Court will either grant or deny

Louisville & Nashville Railroad v. Mottley

--Facts

(D)s Mottleys were injured in a railroad accident and accepted

settlement from (P) railroad that gave them lifetime train passes.

A few decades later, Congress made passes illegal because the

passes were often being used as bribes for political officials.

(D)s want to claim their lifetime passes still, but (P) revokes lifetime

passes based on the Congressional Act

(D)s claim that (1) new rule does not prevent free passes under

these specific circumstances (2) even if the law does prevent the

passes, the Fifth Amendment does not allow taking of property

without the due process of law

--Procedural History

(D)s sue for breach of contract in Federal district court because they

assumed that (D)’s defense would be the new federal law.

(P) demurred, but Federal district court overruled it. Federal district

court then ruled in favor of (D)s, granting them their recovery.

o Demurrer – the facts may be true, but there is no real cause

of action

(P) appeals to Supreme Court to invalidate the passes.

--Issue = is there federal subject matter jurisdiction over a case whose cause

of action does not arise out of a federal law or statute?

--Holding & Decision = Federal District Court’s judgment is reversed and

remitted to the circuit court with instructions to dismiss because federal

courts lack jurisdiction in this matter

SC states that the lower federal court that heard and ruled on this

case didn’t have jurisdiction under §1331. Therefore, SC can’t even

look at the issues in this case because the lower federal court was

erroneous in making a ruling. Must go to state court

--Rules & Reasoning

The action for breach of contract falls under State law, but even

past that, the court only looks at the plaintiff’s allegations in their

complaint originally filed.

A suit arises under the US Constitution and US laws only when the

plaintiff’s statement of his own cause of action shows that it is

based upon those laws or the Constitution.

The plaintiff cannot allege an anticipated federal law defense to his

cause of action and gain subject matter jurisdiction.

o This case falls under §1331 because of federal district court

original jurisdiction

--Significance

There are two ways to establish federal court SMJ:

o One is through diversity of jurisdiction.

o The other is federal question jurisdiction, i.e. the complaint

must allege some violation of the US Constitution or some

federal statute.

Although the court found that (D)’s allegations show that in the

course of litigation a question under the US Constitution would

arise, this did not satisfy the court’s requirement for federal

question jurisdiction that (P)’s original cause of action arise under

the Constitution

This case could be appealed to the US Supreme Court after it was

litigated through the entire state court system because federal

jurisdiction would fall under US Const. art. III §2 – but the US

Supreme Court can deny writ of certiorari

**Courts can raise its own SMJ over a case, just like the court did here^^**

Page 179 – Scenarios: Is there Federal Questions Jurisdiction?

Worker v. Employer

o First, look at the well-pleaded complaint plaintiff states that

the employer has violated the federal law [basis of the

lawsuit]. It doesn’t matter what the employer’s defense is.

o Since worker has stated a federal question in his complaint,

this case does fall under §1331.

o Federal Question = YUP

Citizen v. Newspaper

o First, look at the well-pleaded complaint plaintiff brings a

libel claim, which falls under state law [basis of lawsuit].

o Since the worker has only stated a state law violation, this

case does not fall under §1331

o Federal Question = NOPE

They would only be able to see federal appellate court

after it has already been litigated once defense brings

up the Constitution amendment no original

jurisdiction for federal district courts

Notes & Problems

1.

2.

3.

4. The case above illustrates the rigid but widely used approach to decide

subject matter jurisdiction – the plaintiff’s well-pleaded complaint.

5. The phrase “arising under” is in both Article III and §1331. Most courts

state that Article III is much broader than §1331.

A) Since the constitutional meaning of “arising under” is broader,

the US Supreme court would have the subject matter jurisdiction to

hear the case if it was appealed. The district court did not have

jurisdiction over the case because it operates under §1331, which is

more narrow.

6.

7. A) No federal jurisdiction at first glance, until you look at the federal

agency that played a role in the reason for the suit. Smith is different from

previous case because Mottleys could have pursued their claim against the

defendants without ever mentioning federal law. Here, Smith could only have

brought his action by bringing up federal law – he would have had no cause

of action. B) Grable = this claim seems like a state claim, but in order for him

to bring about his claim, he MUST bring up the federal procedure behind the

defendant’s actions. Plaintiff can only bring about his suit by bringing up

both state and federal law, thus there is federal question; Empire = this is

typically a state claim because it deals with insurance and subrogation. Even

though there were federal employees and federal statutes, the court

reasoned that the case was based on state subrogation law – no federal

claims. Health insurer can seek its suit under state law.

8. Declaratory Judgment – a binding adjudication that establishes the rights

and other legal relations of the parties without providing for or ordering

enforcement.

9. If you want a case to keep its federal jurisdiction, then you must make

sure that your judgment or settlement in a consent decree. A consent

decree/ consent judgment is the only way for someone to bring an action for

defendant’s violation of their settlement/ judgment.

Without the consent decree, there is only a normal breach of

contract which falls under state law

10/13/11 – pgs. 186-201

Note: Challenging Federal Subject Matter Jurisdiction

If you believe there is no basis for federal subject matter

jurisdiction, then you could move for dismissal under Rule 12(b)(1),

asserting the absence of federal subject matter jurisdiction [for

dismissal based on diversity]

Rule 12(b)(1) motions for lack of subject matter jurisdiction based

on “arising under” generally take one of two forms:

o (1) a facial attack on the sufficiency of the complaint’s

allegations as to subject matter jurisdiction – attack the claim

stating there is no federal claim so no jurisdiction; or

o (2) a challenge to the actual facts upon which subject matter

jurisdiction is based – there’s no jurisdiction because there’s

no claim arising under federal law.

The other option is Rule 12(b)(6) – motion to dismiss the

substantive claim, which means if a court grants this then the

federal law raised does not apply to the facts of the case

If the case is dismissed under Rule 12(b)(1), then the plaintiff can

STILL bring their action in state court

o If the court dismisses under this rule, then the plaintiff cannot

re-file their action anywhere because of claim preclusion???

Notes & Problems on How to Respond to Federal SMJ

1.

2.

3.

4.

--Hypo: In Mottleys v. RR, there is no federal question. But suppose Mottleys

are from Kentucky, and RR has its principal place in NY and is incorporated in

Delaware. Is there SMJ?

YES because of diversity of citizenship under federal law

Even though The US Constitution does not give a specific value of

the controversy, 28 USC §1332 narrows the jurisdiction given in the

Constitution [must be more than $75,000]

The provisions of §1332 have been interpreted very narrowly and

very strictly because there have been talks about getting rid of

diversity jurisdiction

C. Diversity Jurisdiction [diversity of citizenship]

Federal diversity of citizenship jurisdiction is made possible by

article III of the US Constitution

Diversity jurisdiction – a federal court’s exercise of authority over a

case involving parties who are citizens of different states and an

amount in controversy greater than the statutory minimum [ 28

USC 1332]

Diversity of citizenship – a basis for federal court jurisdiction that

exists when 1) a case is between citizens of different states or a

citizen of a state and an alien & 2) the matter in controversy

exceeds specific value

o A corporation is considered a citizen of both the state of

incorporation and the state of its principal place of business

o An unincorporated association, such as a partnership, is

considered a citizen of each state where at least one of its

members is a citizen

o Complete diversity must exist for federal subject matter

jurisdiction – this means that all the parties on both sides of

the case must be from different states all plaintiffs must

have different citizenships from all defendants

US Supreme Court has stated that diversity jurisdiction was created

by the legislature to provide a neutral forum for US citizens, foreign

citizens, US states, and foreign states

Recently, Congress has suggested that there is a broader function

for diversity jurisdiction – some cases have national scope and

national implications, so those cases should be heard in a national

court, even if the governing law is state law

o Pay attention to how uncertainty about diversity plays a role

Redner v. Sanders

--Facts: (P) says he is a US citizen residing in France. (D)s are from NY.

(P) files his suit in the Central District of NY asserting diversity

jurisdiction because he is a resident of a foreign state while (D)s are

residents of NY.

o He seems to be applying 28 USC §1332 (a)(2) as a basis for

jurisdiction, alleging he is a resident of France.

o (P) also talks about his connection with CA, mentioning his

various contacts with that state. (P) is trying to lay basis for

jurisdiction under §1332(a)(1).

(D)s file a motion to dismiss the case under Rule 12(b)(1) for lack of

subject matter jurisdiction

--Issue = does subject matter jurisdiction hold citizenship and residence of a

state to mean the same thing?

--Holding = (P)’s case is dismissed for lack of subject matter jurisdiction.

He can re-file this suit again if he gathers more evidence.

--Reasoning

To invoke 28 USC §1332 (a)(2), (P) must be a citizen of the foreign

state, not just a resident. (P) only lives in France, he is not a citizen.

So, this is not applicable.

o His affidavit is completely lacking in details about his life in

France – family, residence, ties to France, etc.

To invoke 28 USC §1332 (a)(1), he must be a citizen of a US state

which means he must be domiciled in that state and he must have

intent to remain there.

(P)’s evidence of domicile is not enough to demonstrate that he is a

citizen of Cali. Also, he never asserts that diversity jurisdiction exists

because of this purported CA domicile, and he does not make a

request to amend the complaint to assert such a claim.

**He can make a move to Cali, making him a citizen OR become a

French citizen and re-file his lawsuit – this may seem like playing

games, but he can do this because the court will only look at

diversity starting when he filed his suit.

o What if (D)s were incorporated in NY and principle-business

based in Cali? NO because there isn’t complete diversity –

there is a match because the courts look at both parts of a

corporations contacts with the states.

Notes & Problems

1.

2.

3. A) The time for measuring citizenship for diversity purposes is as of the

date on which the complaint is filed in federal court. This holds true even if

the plaintiff moves to another state for the sole purpose of establishing

diversity of citizenship.

4. A) Yes there would have been diversity because he would have been

considered a foreign alien. B) yes?

5.

6.

7.

8. Is there diversity? A) No because neither (P) nor (D) are citizens of US. B)

YES because there is a US citizen suing two foreign parties that are different

from each other. C) YES because parties on both sides are from US that are

different states, and there are different foreign parties too. D) NO because

this suit does not fit under any of the lettered sections in §1332 – they must

fit very narrowly and strictly according to the courts.

9. A) For a partnership of business, we need to look at where the partners

are citizens themselves. A few of these partners of the TX corporation were

actually Mexican citizens, thus destroying diversity. No diversity means no

federal jurisdiction.

10. 28 USC §1332(c) deals with determining the citizenship of a corporation.

Corporations have dual citizenship – where it is incorporated AND where it

has its chief place of business. The chief of the business place is a question

of fact – emphasis of the corporate nerve center where the executive and

administrative functions are controlled; concentration on the everyday

business activities of the company [called the muscle].

11.

12. §1359 deprives district courts of jurisdiction in cases where a party has

been “improperly or collusively” joined to invoke diversity jurisdiction.

13. A citizen of DC, Puerto Rico, Guam, and any other American territory is a

citizen of the “state” for diversity purposes.

14.

Hertz decision and pgs. 421-426 supp.

(P)s were just trying to argue that they have a really big presence in

the state of Cali. This court really attacks what the meaning of a

principal place of business of a corporation is.

--Holding: The Court must determine where the corporation’s high level

officers direct, control and coordinate the corporation’s activities (i.e., the

“nerve Center” test).

--Rationale: The Court determined that a corporation’s principal place of

business is the place where the corporation’s high-ranking offices direct,

control and coordinate the corporation’s activities

The Court stated that this place is generally the corporation’s

headquarters. The Court reasoned that the word “place” as used in

§1332 is singular and therefore implies a single place where the

principal business is occurring.

In addition, the text implies that courts should look for a place

within a state, rather than activities taking place throughout the

state.

Finally, the Court reviewed the legislative history and determined

that the legislature wanted the adopt the simple and

straightforward test for determining the principal place of business

and not a complicated one – such as a test where the principal

place of business is determined by the state in which the

corporation does most business

The biggest point here was that a company can have a huge factory

in one state but its principal place of business is actually

somewhere else – nerve center test is the most important test!!!

Saadeh v. Farouki

--Facts:

Farouki (D) owes Saadeh (P) money; by the time the suit was filed,

(D) had achieved permanent resident immigration status in US by

residing in Maryland.

--Procedural History

(P) is a Greek citizen and he invoked diversity jurisdiction. While

they were going through litigation, (D) became a citizen of the US.

District Court rendered a judgment for (P), and (D) appealed on the

merits of the case. Then the CoA asked about jurisdiction.

The parties never brought up jurisdiction at all, the court decided to

look at the issue of jurisdiction

--Issue = Is there subject matter jurisdiction a case involving two foreign

parties as plaintiff and defendant?

--Holding = CoA dismissed the case for lack of SMJ.

--Significance:

According to the last sentence of §1332(a), it seems that (D) would

be considered a citizen of MD because he is a permanent resident

and he is domiciled there. Thus, when taking this literally, it seems

that there is diversity jurisdiction under §1332 (a)(2).

However, the legislative intent was to eliminate diversity jurisdiction

cases between a citizen and an alien living in the same state.

Furthermore, if read literally, it seems that there will be an

unconstitutional result—it would create federal diversity in a lawsuit

brought by one alien against another alien.

The reason the court did not consider (D)’s recent citizen of the US

status is because they have to look at his citizenship at the time the

suit was filed.

Diversity Hypo: a US citizen of Maryland gets into a car accident with a

foreign alien who is domiciled in Maryland. Alien is a citizen of Jordan, but he

has been living in Maryland for he last 25 years. Diversity jurisdiction?

NOPE because the courts would look at these two parties as

residents of the same state.

The judgment here shows a very different interpretation of the

same provision applied to the above Saadeh case. The point of this

provision though is to DEFEAT FEDERAL jurisdiction – they do not

want to add more cases.

Our US Constitution article III, §2 would not allow a court to hear a

US federal suit between 2 foreign citizens.

Notes & Problems

1.

2.

3. SPLIT IN JURISDICTION!! 7th circuit takes the position that for diversity

purposes a resident alien is like a corporation with dual citizenship – a citizen

of both her state of residence and of the foreign nation where she still holds

citizenship. 3rd circuit takes the position that the permanent alien is a citizen

of the state where he resides – not of his native land.

4.

5.

6.

10/17/11 – pgs. 201-213

--Note: $$ Amount in Controversy

Besides diversity §1332 requires the amount in controversy to

exceed $75,000.

This is put in our laws by Congress. The court will determine if the

amount in controversy is correct to allow the case to move forward

based on the well-pleaded complaint.

How do courts deal with cases where there is no actual cost in

controversy, but a specific performance? Courts will look at:

o Cost to the plaintiff;

o Cost to the defendant to specifically perform; and/ or

o Cost or value to the party seeking federal jurisdiction.

This will come up when the defendant questions whether the

plaintiff’s claim is actually worth $75,000 of damages

The will also come up when the plaintiff files case in state court, and

then the defendant has removed the case to federal court –

defendant alleges the damages are more than $75,000

Counterclaims under Rule 13 are different – if the RR had a

counterclaim of $10,000 against the Mottleys [who have $100,000].

Can RR raise the claim?

o They can if the counterclaim is compulsory – it has to be

raised or RR loses it, and it arises out of the same action that

the plaintiffs raise.

o They can’t if the counterclaim is permissive

--Hypo – Go back to the Mottley case:

Mr. Mottley and Mrs. Mottley each have $40,000 in damages for

their claims, so they want to add their claims together to exceed

the $75,000 – is this legal? NOPE because neither have the amount

She can aggregate her claims together in order to exceed the

$75,000 amount – is this legal? YUP

If she has $75,000 in her claim and he has $40,000, so he wants to

join his suit to hers – is this legal? YUP because she’s in

Examples of Congress requiring less for Diversity:

Federal Interpleader Act, 28 USC §1335

Class Action Fairness Act of 2005, 28 USC §1332 (d)

28 USC §1369

D. Supplemental Jurisdiction

This doctrine broadens and expands federal jurisdiction this

statute allows “jurisdiction over a claim that is part of the same

case or controversy as another claim over which the court has

original jurisdiction” [A is the widest part of the statute, and B & C

bring it back a little]

o By default, courts have supplemental jurisdiction over "all

other claims that are so related to claims in the action within

such original jurisdiction that they form part of the same case

or controversy" [§ 1367(a)].

o This means a federal court hearing a federal claim can also

hear substantially related state law claims, thereby

encouraging efficiency by having one trial at the federal level

rather than one trial in federal court & another in state court.

o However, if the case is brought as a diversity action, there

generally is no supplemental jurisdiction if such claims would

destroy complete diversity.

§1367(b) states “if jurisdiction is based on diversity, no

supplemental jurisdiction over claims by plaintiffs against persons

made parties under FRCP rule 1 (third party) 19, & 20 (joinder of a

party) or 24 (intervention).. when exercising supplemental

jurisdiction over such claims would be inconsistent with the

jurisdictional requirements of section 1332.”

Under 28 USC §1367(c), courts are also free to decline to exercise

supplemental jurisdiction in specified or exceptional circumstances.

§1367(c) provides four instances where a court can decline to

exercise supplemental jurisdiction:

o The claim raises a novel or complex issue of State law;

o The claim substantially predominates over the claim or claims

over which the District Court has original jurisdiction;

o The District Court has dismissed all claims over which its has

original jurisdiction; OR

o In exceptional circumstances, there are other compelling

reasons for declining jurisdiction

Notes & Problems

1.

2. A) There is federal question jurisdiction because of the violation of federal

civil rights, which gives subject matter jurisdiction. There is supplemental

jurisdiction because the state law claim has the same common core of

relevant facts to the federal suit. B) No supplemental jurisdiction because the

state law claim does not deal with the controversy in the suit – it’s a

completely different set of facts and has nothing to do with the federal

statute violation. C) The last sentence of §1367(a) allows the joining of the

additional party, and (b) doesn’t apply here because there is no diversity

jurisdiction here. There is supplemental jurisdiction because the state tort

law is related to the violation of the federal statute violation. D) This falls

directly under §1367(b), and there is no supplemental jurisdiction here

because of diversity issues. The additional party is from the same state as

(P), which destroys diversity and this violates another federal statute. E)

Supplemental jurisdiction is not needed here because there is diversity &

amount in controversy [§1331] and federal question claims [§1332].

Supplemental is only needed when you can’t get any federal jurisdiction

through the other federal statutes.

3. Supplemental jurisdiction basically means that the relationship between

the claims permits the conclusion that the entire action before the court

comprises one constitutional case.

United Mine Workers v. Gibbs -

4.

In re Ameriquest Mortgage Co. Lending Practices Litigation

--Facts:

(P) is a home buyer who is lending money from (D). (D)

overestimates her home value in order to increase her loan amount

and make more money.

(P) sues under the federal Truth in Lending Act (TILA). (P) also sues

for improper disclosure and conspiracy (both state laws)

o Count I: federal violation of TILA - goes up under §1331

(federal cause of action)

o Counts II and III: state fraud claims – can they go up under

supplemental jurisdiction?

--Procedural History:

(P) sues (D) in federal court for all her claims on the basis of

supplemental jurisdiction (§1367). Defendants move to dismiss

state claims via Rule 12(b)(1).

--Issue: Can a plaintiff’s state claims be linked to federal claims and get to

federal court under supplemental jurisdiction?

--Holding: (D)’s motion to dismiss state claims (counts II and III) is denied.

(P)’s claims can be linked because they combine to tell one story:

(P) didn’t know her right to cancel at the outset,

Her home value was overstated and so she has paid too much on

the loan and has not been allowed to refinance.

Now (P) wants to void her mortgage based on that lack of

disclosure.

--Reasoning: Court decides to exercise their discretion in favor of retaining

jurisdiction over all the claims.

In order to qualify, there must be common operative facts meaning

you would ordinarily try all the different claims in one case. Here,

the state claims are integrally connected to the federal claims.

The court couldn’t make a decision on one issue, without affecting

the decision on the other issue.

To determine whether the federal and state law claims are

connected by common and operative facts, the facts necessary to

prove the federal claim are compared with those necessary to the

success of the state claim.

In this case, Skanes (P) explicitly connected her federal and state

claims. She did not fully know of her right to cancel her mortgage,

she paid too much during the life of the loan because the mortgage

was overstated, and she has not been able to refinance the

mortgage due to the over-statement.

The connection is operative, in that if the court were to dismiss the

state law claims, it may not be able to grant the rescission of the

mortgage under TILA. Because the court cannot conclude that the

resolution of one of her state claims will have no effect on the

resolution on her federal claims, supplemental jurisdiction is proper

Szendrey-Ramos v. First Bancorp.

--Facts

(P) Ramos is employed as general counsel for (D) Bancorp. (P) is

told about some company ethics violations from an external source;

thus, (P) investigates and divulges her findings to both external and

internal sources. (P) is subsequently fired.

--Procedural History

(P) sues (D) in federal court for illegally firing her under US federal

law Title VII; she also states a number of violations of Puerto Rican

state law: wrongful discharge, violations of Puerto Rican

constitution, defamation, etc.

(D) motions to dismiss all state and federal claims.

--Issue: Does supplemental jurisdiction allow (P) to bring her state claims into

federal court?

--Holding: While the court does have supplemental jurisdiction over these

claims, this court uses its discretion not to exercise jurisdiction.

State law claims are dismissed. Federal Title VII claim can move

forward.

--Reasoning:

For §1367(a), look at the facts of the suit and see if they are related.

The court does have supplemental jurisdiction over the claims

brought by (P), but there are some issues.

o (1) State law claims raise novel and complex issues of state

law; and (2) State law claims substantially predominate over

the federal claim.

In regards to #1, the court does not want to touch interpreting what

Puerto Rico law says about ethics for lawyers

o Puerto Rican state law on some of the central matters is

substantially different than American law with regard to

lawyer conduct.

In regards to #2, state claims are far greater in number & to prove

them, case goes way outside the scope of what is needed to prove

the federal claim.

o If state law claims raise novel issues of state law or

substantially predominate over the federal claim, the state

claims cannot come up under supplemental jurisdiction – see

§1367(c).

Notes & Problems

1.

2. Even if the federal and state claims in an action arise out of the same

factual situation, litigating these claims together may not sere judicial

economy or trial convenience.

Federal and state laws have different focuses & they have evolved

at different times within different legislative systems

In almost every case with supplemental state claims, the courts and

counsel are unduly preoccupied with substantive and procedural

problems reconciling the two bodies of law and providing a fair and

meaningful proceeding.

The attempt to reconcile the two distinct bodies of law often

dominates and prolongs pretrial, complicates the trial, lengthens

the jury instructions, confuses the jury, results in inconsistent

verdicts, and causes post-trial problems with respect to judgment

interest and attorney fees.

3.

4.

10/19/11 – pgs. 213-221

E. Removal

Jurisdictional statutes give plaintiffs an initial choice of state or

federal court when federal and state court jurisdiction overlap

However, defendants also have the power to challenge the

plaintiff’s decision to choose state court when the claim could have

been brought in federal court

Removal is under 28 USC §1441

o (a) If the civil action is brought in state court and the federal

court would have original jurisdiction [either under federal

question or diversity], then the defendant has the right to

move for removal to federal court

If there are multiple defendants, then all the defendants

must agree together in the filing for removal – it doesn’t

have to signed, but the defendants must all consent to

it in court

o (b) If the case is removed because of diversity, then that

defendant cannot remove it to state court if he is home-

towned in that state

The procedure for removal is under §1446

o Defendant files a “notice for removal.” It only needs to be “a

short and plain statement of the grounds for removal,

together with a copy of all process, pleadings and orders”

o You must file within 30 days after you (as the defendant)

receive file; however, you only have one year to remove if its

based on diversity of citizenship

If its not based on diversity, then there is no 1-year cap

The process for challenging removal is under 28 USC §1447.

§1447(c) has provisions concerning remand to state courts:

o 1) A motion to remand on the basis of any defect other than

lack of SMJ has a 30-day limit this applies to problems that

would prevent removal but would not have destroyed federal

jurisdiction

Motion to remand has a 30 day limit after the filing of

the notice for removal. If you don’t file this motion in

time, then as the plaintiff then you will lose your right

and the case will stay where the courts decide

jurisdiction lies

This 30 day limit is the plaintiff’s window to point out

lack of jurisdiction and procedural issues made by

defendant

This motion will give the plaintiff the right to point out

any problems with the case’s procedure [if defendant

filed removal after 30 day limit] – the defendant’s

screw-ups can help the plaintiff even if the federal

courts have jurisdiction

o 2) Requires remand if the district court lacks SMJ this refers

to the facts that negate federal SMJ

Hypo about removal and remand: Situation of a case where it is removable.

(P) wants to move to remand the case because (D) didn’t file for removal

within the 30 day time limit. However, (P) misses his 30 day window to point

out that (D)’s procedural error; can he do anything?

(P) can file a motion for sanctions OR the court can sanction (D) for

missing the window to file for removal.

Notes & Problems

1. A) This case cannot be removed because 1st amendment is a defense, and

the federal claim must be in the complaint. Defamation is not a federal

claim, so there is no federal jurisdiction because plaintiff’s complaint does

not bring up federal question. B) Yes because the original action could have

been brought into federal court based on the federal question. C) Yes

because there is diversity and the amount on controversy is satisfied. D) This

action could not be brought in NJ court because the defendant is from NJ – he

couldn’t argue bias against him. E) Because the plaintiff brought in the

federal claim, the defendant may remove the whole action because of the

federal question claim now under §1441(c). F) Even though both (D)s

consented to removal, the case cannot be removed because one of the

defendants are from the home state where the suit is filed.

2. A) Notice must say that there is diversity and the amount in controversy

fulfills the requirement in the USC. E) Most states do not allow parties to

assert the amount of damages in their complaint. If the damages are higher,

then send the interrogatory to the plaintiff a question of what specifically

makes up that amount and what the elements of the damages are. You will

then have the information you need to prove that the amount is higher,

which will make the case removable.

Courts look at the plaintiffs well-pleaded complaint so will the

court make a determination of whether the complaint is generally

correct in terms of damages alleged?

If a defendant thinks a case is removable but cannot remove it for

amount in controversy, what should he do – get a statement from

plaintiff showing what the damages are and what they believe those

damages amount to.

However, if you can’t get this information, then you can’t file a

notice for removal – if you do, then you will be sanctioned.

IMPORTANT Hypo = (D1) is a small-time player from Georgia and (D2) is the

big-time player from South Carolina. (D1) gets served first about the suit in

Pennsylvania court. (D1) doesn’t pay attention to the claims against him in

terms of removal because he doesn’t believe it matters. (D2) is served a

month later, and he asserts right to removal for the case. There is a split in

jurisdiction about this situation:

Some courts believe that it deals with the service of the first

defendant – in this situation, it means that (D2) would not be able to

file for removal because the 30 day limit has run from (D1)’s service

of the suit.

o 5th circuit goes with this rule above

Other courts believe that it deals with the service of the last served

defendant – then (D2) would be able to file for removal. They claim

that this situation should be the last served defendant because the

plaintiff has the duty to serve all the defendants, and all the

defendants have their own rights in a case.

o 6th, 8th, and 11th circuit agree with this rule above

****Rule 11 will not sanction you for a good-faith argument. So if you are

placed in this situation, then you can plead one of these arguments showing

that there is a split in jurisdiction****

Caterpillar, Inc. v. Lewis

--Facts

(D) Lewis, a Kentucky resident, commenced this civil action in

Kentucky state court after sustaining personal injuries while

operating a bulldozer. Asserting state-law claims, Lewis named as

previous (D)s the manufacturer of the bulldozer—(P) Caterpillar Inc.,

a Delaware corporation with its principal place of business in

Illinois--and the company that serviced the bulldozer--Whayne

Supply Company, a Kentucky corporation with its principal place of

business in Kentucky.

Liberty Mutual, a MA corporation, intervened later as an additional

(P) asserting subrogation claims against both (D)s. Lewis entered

into a settlement agreement w/ (D) Whayne, which allowed Whayne

to be dismissed as a (D).

--Procedural History

With 1 day to spare the statutory req. of 1 year, (D) Caterpillar filed

a notice of removal to Kentucky Federal DC asserting complete

diversity because Whayne exited the case post-settlement.

o However, the official documents that dismissed Whayne as a

defendant have not be filed, so they are technically still a

party to the lawsuit

Lewis objected to removal and moved to remand the case to state

court stating that Liberty had not settled its subrogation w/ Whanye

yet – no diversity.  Federal District Court denied the motion. 

3 years later Liberty and Whayne settled.  Jury trial followed with a

verdict for Caterpillar.  Lewis appealed the judgment stating that

removal of the case when diversity was incomplete is a

jurisdictional defect = the court lacked SMJ. Adherence to the rules

prescribed for removal would have kept the case in state court.

CoA vacated the judgment, concluding that because of lack of

diversity at the time of removal, the Federal District Court lacked

subject-matter jurisdiction. 

--Issue = Is a DC’s error in failing to remand a case improperly removed fatal

to the ensuing adjudication if federal jurisdictional requirements are met at

the time judgment is entered?

--Holding & Decision = CoA erred in resting its decision on the absence of

subject matter jurisdiction.  Reversed and remanded

--Rule & Reasoning

The case was improperly removed because there was no diversity

because parties from Kentucky were on both sides, AND the motion

for remand was improperly denied – BUT there were no lingering

jurisdictional issues when the trial took place in Federal Court.

o At the time of trial in Federal District Court, there was

complete diversity and federal subject matter jurisdiction. 

The result would have been the same for the case even if the

motion to remand had been granted – matters of efficiency,

economy, and finality outweigh going back through the case all over

again because the result would have been the same.

--Significance = this case has been very, VERY narrowly and strictly applied

and used. Federal Court jurisdiction must hold through the entire time of the

case for a court to allow a mistake of procedure go without being fixed.

Hypo = (D) is from TN and (P) is from KY, and there is a valid legal amount in

controversy for federal court jurisdiction.

If there are two non-diverse parties, and (D) moves to TN. Is the

case removable? No because there was no diversity at the time of

filing.

(P) is from KY, (D1) is from KY, and (D2) is from LA. (D1) is

dismissed from the suit. Thus (D2) can file for removal as long as he

meets the requirement for time to file.

--5th circuit – if there is a claim for some type of fraud form any of the parties,

there must be grievous evidence pointing it out

In one case like the above hypo, the dismissal of one party made

the case removable. (D)s had made the file for removal well within

the time period specified in the time limit. However, the plaintiff

held onto the file for removal a few days past the 1 year limit to

keep the defendant from removing the case legally. 5th circuit ruled

in favor of (D) and allowed removal

Notes & Problems

11/19/12 10:22 AM

10/31/11 – pgs. 221-237

Chapter 4: The Erie Problem [definition in Black’s]

This chapter explores an entailment of the shared power between

state and federal courts to hear case. How does the Constitution

ensure that these two court systems respect each other’s spheres

of power?

They exercise overlapping jurisdiction and share power – several

different states may have jurisdiction to hear a case against a

particular defendant.

o Similarly state courts can hear cases arising under federal

law, and federal courts [sitting in diversity] can hear cases

that could also be tried in state courts

So what law applies to these cases? This opens the broad field of

inquiry knows as choice of law or conflicts of law

o Erie raises the question that when a federal court sits in

diversity jurisdiction, what law does it apply?

This problem only applies to diversity cases!

o Why would a plaintiff want to fill in federal district court in the

defendant’s hometown state? To gain personal jurisdiction

over defendant, the laws in that state are better for him, he

may have pissed people off in his own state court system, the

defendant’s state court system might be more efficient, etc.

A. State Courts as Lawmakers in a Federal System

Rules of Decision Act, 28 USC §1652 – “the laws of several states,

except where the Constitution or acts of Congress, shall be

regarded as rules of decisions in civil actions in the courts of the US,

in cases where they apply”

o So what law is applied then? Substantive enacted law and

case law will be applied!

o Stare decisis – precedent set by the highest court in the state

will be used in these federal courts to apply to the case, but

the federal courts are not necessarily bound by this doctrine

For many federal courts, Swift became a charter of judicial

independence – a declaration that they could ignore state case law

when they heard diversity cases

--The Issue in Historical Context

Swift v. Tyson [1841]

o Issue = Does the term “laws of the several states” in the

Rules of Decision Act include state common law?

o Holding = No, the term “laws of the several states” in the

Rules of Decision Act does not include state common law.

o Reasoning = The court held that the “laws of the several

states” in the Act required federal courts to apply state

statutory law but not state common law [civilian approach].

The decisions of courts hardly constitute laws; they are

at most only evidence of what laws are. The laws of the

state are understood to mean the rules and enactments

written by the legislative authority, or long established

by local customs having the force of law.

The court stated that it had long considered that the Act

was limited only to positive statutes of states. Under

these facts, the common law (or judge made law) of

New York would provide a defense to Tyson but the

federal courts were not required to apply it by virtue of

the Rules of Decision Act.

--Constitutionalizing the Issue

Erie Railroad v. Tompkins

--Facts

Tompkins (P) sustained personal injuries when he was struck by an

Erie Railroad Company (D) freight train in Pennsylvania while

walking on a footpath adjacent to the tracks. Tompkins was a citizen

of Pennsylvania and Erie Railroad Company was incorporated in

New York.

--Procedural history

(D) brought this diversity lawsuit in NY federal district court

asserting that he was lawfully on the property as a licensee, and

that the accident occurred as a result of Erie Railroad’s negligence

in the operation or maintenance of the train. (P) Erie denied liability

and asserted that the rule that had been established in the courts of

Pennsylvania should apply.

o Under PN rule, persons using pathways adjacent to railways

were deemed trespassers and the railroad would not liable for

injuries unless its actions were wanton or willful.

o He wanted NY court in hopes that they would apply “general”

common law from all over that constituted ordinary

negligence law because it would help him recover damages.

Tompkins contended that since no PA statute addressed liability in

such cases, the railroad’s liability should be determined according

to the rule established in Swift v. Tyson. Under Federal CML,

Tompkins would be regarded as a licensee, so Erie would be liable

upon a showing of ordinary negligence.

Jury returned a verdict for Tompkins for $30,000. The CoA affirmed,

holding that in regards to questions of general law not covered by

state statute, federal courts are free to exercise their judgment as

to what the law is.

The Supreme Court granted certiorari.

--Issue = In diversity actions, except in matters governed by the Constitution

or acts of Congress, must federal courts apply state common law in addition

to statutory law?

--Holding = Reversed and remanded back where state laws will be applied.

--Rule & Reasoning (Brandeis)

In diversity actions, except in matters governed by the Constitution

or Acts of Congress, federal courts must apply state common law in

addition to statutory law. Swift is unconstitutional

In diversity cases, federal courts must apply state law as declared

by the highest state court in addition to state statutory law. There is

no federal “general” common law.

o Congress has no power to declare substantive rules of

common law applicable in a State and the Constitution does

not confer such a power upon the federal courts.

In disapproving Swift, the Court does not hold §34 of the Federal

Judiciary Act of 1789 unconstitutional. It merely declares that, by

applying the doctrine of that case, rights which are reserved by the

Constitution to the States have been invaded.

Swift is overruled because it was an unconstitutional assumption of

powers by the US Courts. Federal courts do not have the power to

create federal common law as this gives federal courts powers not

granted in the Constitution.

o Congress has no power to declare the substantive rules of

common law in state actions.

--Significance

The Swift decision is flawed because it promotes forum shopping.

Citizens of one state could move to another state to create diversity

and bring suit in federal court to take advantage of a more

favorable choice of law. Such a defect is substantial and provides no

benefit.

However, now there is a hazy line between the procedure and the

actually substance of a case. Examples: choice of law [p], statute of

limitations [p], enforcement of arbitration agreements [p], jury or

judge [p], method of service of process [s/p], enforcement of forum

selection clause [s/p], reduction of excessive damage award [s],

claim preclusion [p].

o Courts now have to grapple with the examples above to

decide how to judge the case in regards to the Erie problem

Notes & Problems

3. People try to defend Erie decision with the 5th and 10th Amendments

5th prevents discrimination results because there should be no

reason that results would change based on if someone was injured

by someone diverse.

10th

No Clause gives the federal courts or congress the power to create

state laws [especially to be applied in lawsuits]

4. Klaxon v. Stentor Elec. Mfg. Co. =

Note on Erie & the Persistence of Federal Common Law

Erie holds only that “general” federal common law may not displace

that of the states in areas in which the Constitution grants

lawmaking power to the states

The Constitution thus grants potential lawmaking power to the

federal courts in many areas because it grants lawmaking power to

the federal government, and the courts are part of that body

Federal statutes may also provide an opportunity for federal

common law to fill gaps in the statutory scheme

The result in Erie was also used to prevent parties from vertical

forum shopping – going from state court to federal court. However

by “curing” this problem, they have only shifted to parties

horizontal forum shopping

o Parties can now move from state federal court to another

state federal court in order to get certain laws applied to their

case that will give them more benefits.

B. The Limits of State Power in Federal Courts

Erie established that federal courts sitting in diversity action were

bound to replicate state practice in some circumstances

Although Erie did not say so, its setting suggested at the very least

federal courts sitting in diversity should observe state substantive

law, whether made by legislatures or by judges

The Supreme Court has attempted to address the different

questions and principles that have risen from Erie:

o Erie requires deference to state courts as lawmaking bodies;

o Federal courts are an independent judicial system

--Interpreting the Constitutional Command of Erie

Guaranty Trust Co. v. York – “Outcome Determinative Test”

--Facts: There was a breach of trust by Guarantee.

--Procedural Posture:

(P) brought action governed by NY substantive law in federal court

based on diversity of citizenship. (D) moved for summary judgment

on the grounds that the state statute of limitations had run.

o (P) argues that the court should apply equity, which means

the court would look at whether the case was brought in a

reasonable time instead of the rigid statute of limitations

o This is a procedural issue, and federal laws should be applied.

District court granted summary judgment stating that it was

prescribed by state statutes. CoA reversed holding that the statute

of limitations did not apply in this federal court case in the presence

of a federal tolling doctrine.

--Issue: Under what circumstances are federal courts bound by state law in a

diversity action under a procedural issue?

--Holding: Where it would “significantly affect the result” of litigation, a

federal court should use the state law.

--Reasoning:

Erie did not merely overrule Swift with regard to “substantive” state

law. It overruled the judicial process of federal courts disregarding

state law where it would lead to different results in the state vs.

federal court in a diversity action.

In these cases, the federal court is acting as just another state

court. Thus, it cannot afford recovery for a state-given right if the

state itself would not afford recovery.

The difference between “substance” and “procedure” is not the

dividing line for when to apply state law. Rather, the question is

whether the state law merely concerns “the manner and the means

by which a right to recover is enforced” or whether it would

“substantially affect the result.”

Here, the state bars the action. Thus, the federal court should bar

the action for the same reason.

--Significance = Outcome Determinative Test

There is a difference between the manner and means of a lawsuit

compared to the substantive issues of a lawsuit. If not following

state law would change the outcome of the case, then the state law

should be followed in the case.

Weakness This test can be used to argue any facet of a lawsuit,

so it really doesn’t help – think about the size of a piece of paper to

file a lawsuit & the statute of limitations.

o Basically, most courts ended up holding that state law would

apply to all cases where this question came up.

Notes & Problems

For each case coming up, follow these guidelines:

State the facts

When looking at the issue, decide if we are applying federal rule,

federal statute, or federal practice.

When looking at the result, see if there is difference in results if the

case would have been tried in a state court or a federal court.

What did the court hold?

What did the court reason and what test did it apply?

11/07/11 – pgs. 237-255 & Supp. Reading for Erie chapter!

Byrd v. Blue Ridge Rural Electric Cooperative

--Facts

Byrd (P) was injured in South Carolina while connecting power lines

in the course of his employment for a subcontractor of Blue Ridge

Rural Electric Cooperative, Inc.

(P) brought a diversity action against (D) for personal injuries. Under

South Carolina law, if (D) were (P)’s statutory employer, (P)’s award

would be limited to workmen’s compensation and he would not be

entitled to sue (D) for negligence.

(D) raised an affirmative defense based on South Carolina law that

it was (P)’s statutory employer and that (P) was therefore limited to

workmen’s compensation.

--Issue = Under the Erie doctrine, must state law be applied in

determinations of rights for trial regardless of conflict with US federal law

and the Constitution?

We are applying federal practice by federal policy to use juries.

State law says judge will decide, federal law says jury will decide.

--Holding = Reversed and remanded.

--Reasoning

There was a strong federal policy against allowing state rules to

disrupt the judge-jury relationship in the federal courts. The Erie

doctrine does not mandate that state law be applied in

determinations of procedure regardless of conflict with federal law

and the Constitution.

The Court held that South Carolina’s determination that immunity

was a question of law to be decided by a judge was merely a

determination of the form and mode of enforcing immunity. It did

not involve any essential relationship or determination of rights

created by state law. The court held that the Erie doctrine can still

reach form and mode determinations if there are no affirmative

countervailing considerations.

The right to a jury trial in federal court is a fundamental and

essential right provided for in the Seventh Amendment and that

may not be changed by any contrary state law or requirements

--Balance Test – balances state interests against federal interests

How bound up with the right is the state law? Is the state practice

bound up with the substantive rights and obligations of the party?

o If so, then state law applies. If not, go on to next question.

Is the difference outcome determinative?

o If yes, then go on to the next question.

How important is the federal interest? This must be compared to

state interest.

Notes and Problems

2. Deciding to use a jury instead of a judge in Byrd might change the

outcome of the case. The court states that the federal system is an

independent system for administering justice to litigants who properly invoke

its jurisdiction. The federal system is still called to use its own rules and laws

to govern its function in our judicial system.

II. De-Constitutionalizing Erie

Hanna v. Plumer

--Facts & Procedural History

Hanna was involved in an automobile accident in South Carolina

with Osgood. Hanna brought a diversity action in Massachusetts

federal district court against Plumer.

Plumer was served with process according to FRCP 4(d)(1) by

leaving copies of the summons with his wife at his residence.

o Under Massachusetts rules however, service upon an executor

must be handed personally to the executor within one year

Plumer moved for summary judgment on the grounds that the state

law rule regarding service should be used. He argued that the Erie

doctrine applies in this case because if Massachusetts rules applied,

the case would be dismissed because Plumer had not been served

properly within the state’s statute of limitations.

o On the other hand, if the federal rules applied, Hanna would

have an opportunity to have the case tried on the merits.

The trial court granted Plumer’s motion and Hanna appealed,

arguing that the rule established in Erie applies only to issues of

substantive law and not procedural rules.

The First Circuit affirmed and the US Supreme Court granted cert.

--Issue = Does the Erie doctrine apply to rules of procedure pertaining to

service of process? Does FRCP apply irrespective of whether state or federal

substantive law applies?

We are applying federal rule.

--Holding = Reversed. Service of process under the FRCP was the standard,

which the district court should have measured the adequacy of service.

--Reasoning

The question in this case only goes to procedural requirements. A

dismissal for improper service under these facts would not alter the

substantive right of Hanna to serve Plumer personally and re-file or

affect the substantive law of negligence in the case.

Article III and the Necessary and Proper Clause provides that the

Congress has a right to provide rules for the Federal Court (FRCP

4(d)(1). To hold that an FRCP must cease to function whenever it

alters the mode of enforcing state-created rights would be to

disembowel either the Constitution’s grant of power over federal

procedure or Congress’ attempt to exercise that power in the

Enabling Act.

The Erie rule has never been invoked to void a Federal Rule. If there

is no federal rule, Erie commands the enforcement of state law. The

federal rule is valid and controls the case.

Both the Enabling Act and Erie state that federal courts are to apply

state “substantive” law and federal “procedural” law.

--Concurrence by Harlan

The test for deciding whether the Erie doctrine applies to a rule of

procedure should be a determination of whether the choice of rule

would substantially affect those primary decisions respecting

human conduct which our constitutional system leaves to state

regulation.

o If so, Erie and the Constitution require that the state rule

prevail, even in the face of a conflicting federal rule.

Erie wanted to ensure that there were not two conflicting systems of

law and the creation of substantive state law by federal courts

should be avoided if that creation extends beyond constitutional

limits.

--Significance = The majority opinion illustrates that the federal interest in

creating a uniform code of procedure for the federal court system is

secondary to the state’s procedural laws.

In the event there is a direct conflict, the federal law must prevail so

long as it complies with the Rules Enabling Act and the U.S.

Constitution.

--FRCP or federal statute Test

Threshold: is rule sufficiently broad to control the issue before the

court? If yes, then ask:

o Is rule consistent wit the Rules enabling act; is it rationally

capable of classification as procedural?

o Is rule or statute constitutional? (Art. III gave Congress power

to make rules governing practice and procedure in federal

courts)

o If yes to both, federal rule controls.

If no federal rule but there is a federal practice…

o Would adhering to federal practice encourage forum

shopping?

o Would adhering to federal practice result in inequitable

administration of justice?

--Rule Enabling Act – gives the US supreme court the power to create rules of

practice and procedure.

Hypo 1: Plaintiff from NY suing defendant from Cali – diversity action. State

law requires that the complaint pleading be set forth in specific factual

detail. Federal rule only requires a short and plain statement known as

notice pleading.

We are applying test for federal rule.

Threshold: Yes because the rule is basically telling you what is

required in the pleading.

#1 – yes it is rationally capable. #2 – yes it is constitutional because

our Constitution gave Congress the power to make FRCP.

Hypo 2: Plaintiff from Rhode Island suing Defendant from Massachusetts.

Diversity filed in federal court in Massachusetts. This is a medical

malpractice action against defendant hospital on the grounds that plaintiff

got STD due to defendant hospital’s negligence. State law requires all

medical malpractice suits to go through non-binding arbitration [most states

have these types of procedures before you can actually litigate the case].

Under state law, the plaintiff will have to give up a bond to ensure that the

defendant can pay for his case if he wins. There is no federal rule that

applies to these types of cases.

We are applying federal practice or policy test because there is

absence of federal rule that governs the procedure for filing this

type of case.

Because the plaintiff must give up the bond, then it seems like it will

be bound up with substantive rights and obligations of the parties –

yes to #1 because it deals with the defendant’s remedy.

However, if the court found that it was not bound up, then we will

go through the next 2 questions:

o #1 yes it would be outcome determinative because then the

case would be dismissed if you decided to use the state law

over the federal law.

o #2 the federal interest would be that more people would have

a greater chance to bring their action in federal court since

there is no arbitration procedure.

The second part of Hanna test

o #1 yes adhering to the federal practice would encourage

forum shopping because the burden on the plaintiff is a lot

less because they only need to file the suit.

o #2 yes adhering to the federal practice would result in

inequitable administration of justice because the hospital

would have to defend itself against possible frivolous claims

made by diverse citizens. Hospitals may then decide to stop

treating diverse citizens because of this practice.

Hospital keeps protection if state law is applied,

whereas lose protection if federal law is applied.

The case would be dismissed because ______?

o Example of case just like this hypo: 643 F.2d 880

Notes and Problems

2. Byrd and Hanna held that the federal court need not behave as a state

court would if it were hearing the case. Both presented multi-tiered tests for

determining whether federal or state practice should prevail.

Hanna – narrowly construed, tells a federal court what to do when a

Rule or federal statute dictates the federal practice.

Byrd – deals with a federal practice not dictated by a specific federal

statute or Rule.

3. If the statute is constitutional and tells a federal court to do something,

the court must follow the dictates of that statute. In the case of FRCP, the

analysis requires two tests:

Does the Rule promulgated under the authority of the Rules

Enabling Act fit its description: “rules of practice and procedure”?

Is the procedure specified in the Rule constitutional?

*If the Rule passes both of the above tests, the it must be applied,

even if it differs from the state practice in a significant way. If the

Rule fails either test, then the state rule applies.

4. There are different tests from Byrd and Hanna to determine what to do if

the federal practice in question is not required by any rule or statute.

Byrd: is the state practice “bound up with the definition of the rights

and obligations of the parties”? If so, state law governs; even if it

isn’t part of the substantive rights and obligations, would its

application determine the outcome of the cases? If so, are there

affirmative countervailing considerations of federal judicial

administration present?

Hanna: would following the federal practice lead to forum-shopping

or inequitable administration of the laws? The state should prevail

o The problem with this approach is that for federal diversity

jurisdiction to have any usefulness, it should sometimes lead

to different results, and if lawyers can predict that, their

obligation to their clients requires them to shop for the most

advantageous forum.

III. Determining the Scope of Federal Law: Avoiding & Accommodating Erie

So long as the statute is constitutional and one knows what the

statute requires, the choice of law problem is solved.

Burlington North R. v. Woods

Stewart Org. v. Ricoh

Gasperini v. Center for Humanities

Semtek Intl. Inc. v. Lockheed Martin Corp.

--Facts & Procedural History

(P) filed suit in Cali state court against (D) alleging inducement of

breach of contract and various business torts. (D) removed the case

to Federal District Court in Cali via diversity jurisdiction and

successfully moved to dismiss (P)’s claim as barred by Cali’s 2-year

statute of limitations.

(P) then re-filed suit against (D) in Maryland state court. MD state

court dismissed the suit (kind of like double jeopardy, where you

can’t litigate something that has already been decided.)

(D) again had the case removed to Federal district court for

diversity, and asked the court to apply claim-preclusion to the Cali

Federal District Court’s adjudication on the merits [like res judicata]

& dismiss the suit

--Issue = Is the claim-preclusive effect of a Federal judgment dismissing a

diversity action on statute of limitation grounds determined by the law of the

state in which the Federal court sits?

--Holding = Reversed and remanded.

--Reasoning: Which test applies?

Test for FRCP or federal statute applies? Yes to all three questions

because FRCP 41(b) is very broad and all FRCP within REA are

constitutional. But the court does not follow this

Court states that FRCP was not sufficiently broad to control the

issue before the court federal law would then be telling state

courts that it couldn’t extend its own rules in its courts, which

infringes on state’s own powers as sovereignty

So the court moves to federal practice test: 1) a statute of

limitations deals with how long the possibility of remedy will last so

its pretty bound up SO the state law applies.

The Cali decision and statute of limitations only means that this suit

cannot be filed in Cali again or under Cali law. The case can go on to

MD, but the court does not look to see if MD state law applies or not

only says the case can be tried in MD court.

--Significance

If you get a pattern like this where an FRCP or federal statute is

against a state statute, then you should go through BOTH tests!!

After finishing the first test, “if the court decided that the FRCP was

not broad enough, then the court would have to look at the federal

practice test” then apply the second test and decide.

o It would encourage forum shopping because if you file your

suit late, then you can go somewhere else.

o It would result in inequitable administration of justice.

Notes and Problems

1. This case had a question of how a state court, in a subsequent case,

should understand a federal judgment in a diversity action. Specifically,

whether the state court should give the federal diversity judgment a broader

scope than it would have given a state judgment, had the diversity case

remained in state court. NO

2. Federal courts have regularly said that involuntary dismissals under FRCP

41(b) bar not only the claim pleaded but all claims arising from the

transaction or occurrence behind the pleaded claim.

Note: Interpreting State Law – an Entailment of Erie

Erie requires federal courts sitting in a diversity action to use state

law under various circumstances. That holding requires the federal

court to declare state law.

On appeal from the district court’s judgment, a federal court of

appeals must do its best to decide what the state appellate courts

would do when faced with the same appeal

o This is called an “Erie Guess” because they have to guess

what the state’s supreme court would do

o Federal CoA required to review de novo district court’s

determination of state law.

Certification – the federal court asks the state supreme court for an

answer to a question about state law. There are several defects to

this system.

o The state must have a certification procedure, and many do

not have one. But even when the procedure exists, the results

are not satisfactory

o Sometimes state courts do not accept the invitation to answer

the question about state law. Other times they answer, but in

terms that leave the federal courts as perplexed as they ere

before they asked.

o Part of the problem flows from the circumstance that the

certification process does not simply pass the whole case to

the state supreme court. It is almost impossible for a state

supreme court to answer a question about state law because

the legal dispute often lies in the facts of the case [which the

state supreme court will not know when it gives its answer]

When thinking of Erie, state laws, state statutes, state constitution,

and highest court’s case law will apply.

FRCP Supplement – pgs. 427-428

--Shady Grove Orthopedic Assoc. v. Allstate Ins. Co. – the court split severely

on this case [not precedent]

Four justices thought this was a straightforward clash between

federal procedural rule and state procedural rule. Since the rule in

question did not violate the Rules Enabling Act, it controlled [even

though this lead to some forum shopping]

o Test for FRCP/federal statute:

This directly and expressly applies to class actions so

YES. Moving on, YES it is procedural and YES it is

constitutional

There was a fifth justice who joined in the above opinion, but he

insisted on court’s greater deference to state interests than what

this opinion did

Four justices dissented saying that the majority was departing from

the sensitivity previously shown to state interests by prior decisions

o Dissent agreed with the end but not the reasoning

o There should be a compromise but this dissent does not

disagree with any of the tests we use.

11/19/12 10:22 AM

11/9/11 – pgs. 257-291

The Process of Litigation

A. Approaching Civil Procedure

B. Choosing Procedure

C. A Roadmap for Exploring Choices

Chapter 5. Incentives to Litigate

-- Reality of Types of Cases, Value of Cases, and Disposition of Cases

Most cases will not be tried in actual court because it is much

cheaper and easier to find a resolution and settle the case.

--Remedies – this will be important to the lawyer because you won’t want to

waste your time if its not worth a lot or the case sucks

Specific Remedies

o Specific Performance

Obligation to mitigate

o Injunction

Substitutionary

o Compensatory Damages: What is the quantum of a lawsuit?

How much the lawsuit is worth. Look at the facts of the case

and let me know what its worth.

This matters greatly to the plaintiff and the defendant.

How much you want as a settlement and how much you

are willing to offer for a settlement

You will look at similar cases to find a ball park figure

o Punitive Damages: an attorney will most likely want to take

this type of case because it deals with damages to keep

someone from doing the same thing again

Most times, there must be a statute that allows punitive

damages or gives directions for it

o Statutory Remedy – statutes can either mandate an amount,

give a maximum the person can recover, etc.

These will help you decide if the suit is valuable and if

you even want to take the case

You will also want to look to see if you can get

attorney’s fees, pre-trial judgment, etc.

Declaratory – the party is trying to get the court to declare that he

is actually abiding the law in the lawsuit against him which would

destroy the cause of action for the lawsuit.

o The requirements are that there must be real parties, real

activities in controversy, and not just a worry to get an

advisory judgment.

o Example: case originally starts as Doug v. Bob, and when Bob

files for declaratory relief, the suit changes to Bob v. Doug

--Financing Litigation

State Farm Mutual Automobile Ins. Co. v. Campbell

--The review punitive damage award, consider:

Degree of reprehensibility of (D)’s conduct

o Harm caused was physical or economic

o Whether tortious conduct evinced an indifference to or

reckless disregard of the health and safety of others

o Whether target of conduct was financially vulnerable

o Whether conduct involved repeated actions or was an isolated

incident

o Whether harm was result of intentional malice, trickery, or

deceit OR mere accident

Disparity between the actual or potential harm (P) suffered and the

punitive damage award

o No concrete or bright line rule, but usually there should a

single digit ratio 1-1, 1-9

o A larger compensatory award may justify a smaller punitive

damage award

o Wealth of (D) may be considered, but it is not a justification

for an otherwise unconstitutional award.

Difference between the punitive damage award and the civil

penalties authorized or imposed in comparable cases

o Consider closest civil penalties statute

The court performed the test and held:

o 1) the injury was not solely economic;

o 2) the insurance company evinced a reckless disregard for

plaintiffs' peace of mind;

o 3) plaintiffs were financially vulnerable;

o 4) the insurance company's defiance increased the likelihood

of reoffending; and

o 5) the substantial emotional damages were no mere accident

--Significance = compensatory damages are intended to redress the

concrete loss that the plaintiff has suffered by reason of the defendant’s

wrongful conduct; punitive damages are aimed at deterrence and retribution

11/14/11

Hypo: your client lives Uptown and his next-door neighbor leaves his trash

strewn all over the yard. There are now rats and flies, it smells, and its very

unattractive. Client has trued to talk to his neighbor, but the neighbor

doesn’t care. He decides that his only remedy is a lawsuit.

What remedies could he ask for? You must find out what your client

is looking for & then present his options to him.

o Specific remedy = injunction from leaving the trash out on the

lawn and clean it up.

o Sub Remedy = Compensatory damages because of the pests

coming onto your lawn and if his grass is dying. BUT this will

not necessarily help the problem

No punitive damages because if there is no statute that

allows punitive damages, then you can’t as for (and if

you do, you’ll violate Rule 11)

The client has the right to decide which things to sue for and he

might not want to sue for all the things that he can.

You will want to adjust what your claims are based on whether you

have a judge or a jury trial.

Sigma Chemical v. Harris

--Reasoning – This case gives a test for what someone has to prove for

injunctive relief as a remedy:

Balance the interest of the parties – what is the hardship on the

plaintiff if the injunctive relief is denied? What is the hardship on the

defendant if the injunction is granted?

o Balance – he might not be able to get a job, but defendant

knew he was signing the contract and what it meant; plaintiff

would lose their secrets which would create loss in the

business.

--Things to think about:

Why would we say just asking for money damages for breach of

contract not enough? Yes we want the money, but we also want to

stop him from using the information and telling other their secrets.

The court later amends its order and states that he can work for the

new company but not in his previous position & the new company

cannot use the secrets they got from (D) for a reasonable time [a

time they could have found out the information on their own

research] – this is definitely a loss for (P).

Notes and Problems, pg. 290

1. Breach for top-notch building materials Arthur seeks a declaratory

judgment, and even though Barbara hasn’t sued yet, there are real parties

and a real dispute. Arthur is filing a declaratory judgment so that way if he is

wrong for some reason, he can mitigate the damages now instead of waiting

till a lawsuit is filed against him which would be way worse.

Reminds us of LL Bean case

2. Patent Issue Sam can value her declaratory judgment and the damages

she claims by showing the value of money she may actually lose if Joe

continues with his design OR the value of Joe’s sale for his design OR a

combination of both the loss and sales.

Could Sam also put an injunctive relief against Joe? She sure could

because this is the ultimate remedy she wants, to make him stop

making his design.

This could also be subject matter jurisdiction because patent law

falls under federal question.

3. Libel suit There’s an issue because there are no parties here saying that

what is about to be printed is libel. What if newspaper decides to sue the

mayor’s office? They can’t because there is no controversy between the

newspaper or mayor’s office – this is only the newspaper walking on the

edge thinking they might get in trouble. No cause of action.

However, there is also no subject matter jurisdiction because the

libel only comes up as a defense to the suit, which violates the

“well-leaded complaint” rule – libel is a state law tort action & the

fact that the defense would bring a federal amendment as their

defense does not meet the standard for well-pleaded complaint.

However, if the mayor got wind of the article, then the mayor’s

office could bring declaratory relief action for injunctive relief to

keep the newspaper from actually publishing the article.

--Financing litigation [don’t need to know this for exam]

Contingent fee [if you win, you get paid; if you lose, nothing]

Hourly rate [varies based on type of law your practice, what firm

you work for, where you live geographically, etc.]

Flat rate for particular service [for every normal divorce, you would

charge a flat rate]

Retainer

Fee-shifting statute or contract

Legal aid or pro bono – low cost or no cost

11/19/12 10:22 AM

11/13/11 – pgs. 333-400

CHAPTER 6 – Pleadings

A. The Story of Pleading

Pleadings tell the contestants’ initial stories. This elemental story-

telling aspect of pleadings persists, and a good lawyer never forgets

that behind conventions lie stories.

The complaint is the plaintiff’s first chance to tell that story, and

within convention, a good story is better than a dull one

One of the most fundamental and difficult problems confronting a

pleading system flows from the circumstance that pleadings have

two audiences the court and the defendant(s).

o Most defendants will be more interested in the facts

underlying the case, so they can know what story they will

have to meet in court.

o This flips when it comes to the answer – plaintiffs want to

know the precise details of why the defendant is denying

liability

o **Both will tend to give sketchier recitations of the facts

because they will want more time to make their case stronger

against the other party

--What are pleadings:

Pleadings allowed are under FRCP Rule 7(a) and they are:

o A complaint,

o An answer to a complaint,

o An answer to a counterclaim designated as a counterclaim,

o An answer to a cross-claim,

o A third-party complaint,

o An answer to a third-party complaint, and

o A reply to an answer IF the court orders one

A pleading is basically anything where someone files an allegation

against a party and demands a remedy a pleading is also any

answer to an allegation.

There are forms for the type of pleading you want to file in FRCP.

o These forms really only give you some fill-in-the-blanks, but

you still need to know the substance of your claim and what

exactly you need to put in the complaint to get your case in!

o One big issue plaintiffs can run into is that they need more

information to fill in their pleading to get it past a court, but

the defendant has the information they need.

--Pleadings are guided by FRCP Rule 8(a) called “notice pleading” and

this applies very generally

A pleading that states a claim for relief must contain:

o (1) a short and plain statement of the grounds for the

court’s jurisdiction, unless the court already has jurisdiction

and the claim needs no new jurisdictional support;

o (2) a short and plain statement of the claim showing that

the pleader is entitled to relief; and

o (3) a demand for the relief sought, which may include

relief in the alternative or different types of relief

Goes back to Chapter 4! Also look at pg. 342 at

underlined portion in prayer for relief. Magic language*

Rule 8(b)(3) states what a defendant must do when it comes to

denying a pleading:

o A party that intends in good faith to deny all the allegations of

a pleading — including the jurisdictional grounds — may do so

by a general denial.

o A party that does not intend to deny all the allegations must

either specifically deny designated allegations or generally

deny all except those specifically admitted

Rule 8(b)(4) deals with denying part of an allegation.

o A party that intends in good faith to deny only part of an

allegation must admit the part that is true and deny the rest

--How to challenge the complaint – Rule 12(b)

Defendants want the case to go away as quickly and as cheaply as

possible, so they will often help courts sort through cases based on

pleadings and challenge them

CML has 6 types of challenges, which are also called “pleas”

CML Dilatory

Plea or

Peremptory

Plea

Rough

Translation

Example Effect Modern

Pleadings

Analogue

Jurisdiction “not here” Defendant

asserts that

this case

does not

belong in

federal court

Court

dismisses

case, which

can be

refilled in

proper court

Challenge to

personal or

subject

matter

jurisdiction

Rule 1(b)(1)

(2)

Suspension “not now” Case should

not proceed

because

defendant is

on active

duty in

armed

services and

unable to

defend self

until

discharged

Court stays

case until

defendant is

discharged

from service

Typically

handled as a

defense or by

more

comprehensi

ve statutory

scheme

Abatement “not until this

is fixed”

Defendant

asserts case

is brought in

the wrong

venue

Court

transfers or

dismisses

case

Rule 12(b)(3)

motion

Demurrer “so what?” Defendant

asserts that

allegations

of

complaint

do not state

a claim

Court

dismisses

the case

Rule 12(b)

(6) or

demurrer

Traverse “didn’t

happen” or

“I didn’t do

it”

Defendant

asserts that

allegations

of

complaint

are false

Court

grants

judgment

on merits

for

defendant

General or

Specific

Denial

contained

in the

answer

Rule 8(b)

Confession

and

avoidance

“yes but….” Defendant

asserts

statute of

limitations

has run on

claim.

Court

grants

judgment

on merits

for

defendant

Affirmative

defense

contained

in answer –

release,

statute of

limitations,

accord and

satisfaction

, res

judicata

Rule 8(c)

--The 6 pleas can be separated into two groups:

The first group do not approach the merits of the case. They take no

position on either the facts or the law forming the basis for

plaintiff’s grievance.

o The Dilatory pleas are in Rule 12(b) – these delay the court

proceedings

o Personal jurisdiction/ subject matter jurisdiction/ failure to

state a claim judge decides these

The second group forced the pleader to take a position about the

factual allegations of the complaint.

o The Peremptory pleas are in Rule 12(b)(6), 8(b) and 8(c)

o Traverse/ affirmative defenses jury decides these

Haddle v. Garrison – trial court & CoA’s holding [original complaint]

--Facts

(P) while employed with Healthmaster was called upon as a witness

against (D) in a Federal action for fraud. When the remaining

partners learned of his impending testimony before a criminal

proceeding they terminated him. (P) concedes he was an at-will

employee.

--Procedural History

(P) filed under 42 USC §1985 Civil Rights Act and other state claims,

stating that he received harm from his termination which came

about because of conspiracy to keep him from testifying in the

federal and criminal trial against his former employers.

(D)s filed motions for dismissal for failure to state a claim [Rule

12(b)(6)], which District court granted. CoA affirmed this.

--Holding & Reasoning = dismisses (P)’s claim without prejudice

Because he was an at will employee, he has no claim for wrongful

termination because the company did not owe him any duty to keep

him around.

When it comes to a motion under Rule 12(b)(6), a defendant is

basically saying even if everything the plaintiff alleges is true, the

law afford him no relief.

A court should not dismiss plaintiff’s complaint for failure to state a

claim unless it is very clear that the plaintiff can prove “no set of

facts in support of his claim which would entitle him relief”

Notes and Problems

5. It is almost a universal principle that before granting a motion to dismiss

for failure to state a claim, a court will give the plaintiff a chance to “amend”

the complaint to cure the deficiency the defendant and court have identified.

Rule 11(b) states that “the factual contentions have evidentiary

support or, if specifically so identified, will likely have evidentiary

support after a reasonable opportunity for further investigation or

discovery” basically a plaintiff should not put something in his

complaint unless he has some type of evidence for the statements

he makes.

Haddle v. Garrison [facts are the same from above]

--Holding & Reasoning = reversed for trial.

RULE: One who maliciously and without justifiable cause induces an

employer to discharge an employee, by means of false statements,

threats or putting in fear, is liable in a tort action to the employee. It

makes no difference whether the employment was for a fixed term

not yet expired or is terminable at the will of the employer.

o A court should not dismiss a complaint for failure to state a

claim unless it is clear that (P) can prove “no set of facts in

support of his claim which would entitle him to relief.” 

To make out a cause of action, (P) must have suffered an actual

injury. Just because (P) was an at will employee does not mean he

has no constitutionally protected interest in continued employment.

The wrong at which §1985(2) is directed is not deprivation of

property, but intimidation or retaliation against witnesses in federal

court proceedings.   The sort of harm alleged by (P) here -third party

interference with at will employment relationships – states a claim

for relief under §1985(2).

--Now what? Plaintiff’s case gets to move forward, but it doesn’t mean that

his claim has merit and he will win – just that his claim can move forward.

(D)s eventually had to pay the plaintiff $65,000 for damages; there

was also a fee shift statute attached where defendants had to pay

for plaintiff’s case.

Note on Consistency in Pleading

Rule 8(d)(2)-(3) states that a party may “set out two or more

statements of a claim or defense alternately or hypothetically…

and a party may state as many separate claims or defense as it has,

regardless of consistency.”

o This basically means if defendant has allegedly violated a

contract with the plaintiff, defendant basically says “I never

made a contract with the plaintiff… and if I did, I didn’t breach

the contract.”

The reasons for this Rule are three-fold:

o First pleadings come very early in the case, often before

parties know all that they will by the time the case comes to

trial. Thus the lawyer will set out different, sometimes

opposing claims to set forth what seem to him to be the

possible versions of law and the facts that appear plausible at

the time the pleading is filed.

o Second, allegations in pleadings are tempered by burdens of

proof. Even though a lawyer may completely believe he

client’s version of the facts, as a safety net, the lawyer will

allege a different set in case she decides she cannot convince

a jury that her client’s version is the right version.

o Third, even though the pleadings may seem very inconsistent

and contradictory, the lawyer will eventually settle on a set of

facts after discovery takes place. Our pleading system asks

lawyers to form pleadings this way.

--Rule 10

(a) = Every pleading must have a caption with the court's name, a

title, a file number, and what type of pleading it is

(b) = a party must state its claims or defenses in numbered

paragraphs. This rule makes it easier to keep track of things

o The defendant can then admit to the numbered paragraphs

and deny other numbers.

--Requiring and Forbidding Specificity in Pleading

Courts have often wrestled with the question of how much

specificity, just how much detail to require in pleadings. These

details can help distinguish between strong and weak cases, but the

more details will normally get a case dismissed before discovery.

FRCP’s “short and plain statement” is meant to void the issues

brought by older forms of pleading, but it has its own issues in our

court system because courts do not necessarily agree what “short

and plain statement” means.

--What is a short and plain statement?

As long as you follow with the Forms supplied in FRCP, then your

claim should be allowed to move forward.

A complaint should not be dismissed for failure to state a claim

unless it appears beyond a doubt that the plaintiff can prove no set

of facts in support of his claim which would entitle him to relief.

o From Conley v. Gibson. This was widely used for about 50

years after the case was decided when looked at pleadings

FRCP does not require a claimant to set out in detail the facts upon

which he bases his claim – the Rules only require a “short and plain

statement” that will give the defendant fair notice of what the

plaintiff’s claim is and the grounds upon which it rests.

o Rule 8(e) states that no technical forms of pleading or

motions are required.

o The simple guide of Rule 8(f) is that the pleading must be

construed so as to do substantial justice

If a pleading fails to specify the allegations in a manner that

provides sufficient notice, a defendant can move for a more definite

statement under Rule 12(e) before responding.

o Claims lacking any real merit may also be dealt with Rule 56’s

summary judgment.

However, what if the plaintiff runs into an issue where he is not sure

exactly what the facts are OR if the defendant actually did

something wrong? Parallel behavior v. conspiracy

o Look at the case below!

Bell Atlantic Corp. v. Twombly – don’t have enough info!

--Facts

(P) brought a class-action lawsuit alleging that (D) and a number of

other large telephone companies had engaged in anti-competitive

behavior in violation of § 1 of the Sherman Act.

Specifically, (P) alleged that these large telephone companies had

acted in order to disadvantage smaller telephone companies and

charge consumers more.

--Procedural History = District Court dismissed the complaint because it

wasn’t specific enough, but CoA reversed citing Conley for the “short and

plain statement”

--Holding = reversed and reinstates dismissal of the case.

--Reasoning

Dismissed (P)’s complaint for failure to state a claim under Rule

12(b)(6). (P)'s complaint didn’t provide enough facts for the court to

find it plausible that the companies had engaged in a conspiracy.

Instead, (P)’s complaint provided factual bases for parallel conduct

and merely stated that an agreement had taken place, with no

details to support that allegation need more specifics!!

o Parallel conduct – actions by competing companies that might

be seen as implying some agreement to work together

While parallel conduct is "admissible circumstantial evidence" of an

agreement to engage in anti-competitive behavior, parallel conduct

alone is insufficient to prove a Sherman Act claim.

--Dissent

The majority was concerned with the risk that jurors may

mistakenly conclude that evidence of parallel conduct proves that

the parties acted pursuant to an agreement, when they merely

made similar independent decisions.

This merits careful case management but does not justify the

dismissal of an adequately pleaded complaint without even

requiring the defendants to file answers denying a charge that they

in fact engaged in collective decision making.

More importantly, they do not justify an interpretation of Rule 12(b)

(6) that seems to be driven by the majority’s appraisal of the

plausibility of the ultimate factual allegation rather than its legal

sufficiency.

--Significance = The Court's opinion changed the existing interpretation of

the notice pleading requirements of Rule 8 creating a new, stricter standard

of a pleading's required specificity.

The court adopted a more strict, "plausibility" standard,

requiring in this case "enough facts to raise a reasonable

expectation that discovery will reveal evidence of illegal

agreement"

Plaintiffs must look at the substantive law to know what to put in

their complaint. At Rule 8, the courts take what the plaintiff’s

complaint says as true, and the court is looking to see if the plaintiff

could win based on his complaint.

o Here he could not win because there was no specific evidence

of a conspiracy, only had evidence of parallel conduct. He

needed dates of meetings or all defendants changing prices at

the same time, etc.

o There must be factual basis for what plaintiff alleges. Plaintiffs

cannot just throw around allegations in hopes that they can

get to discovery to maybe find something a defendant did.

Notes and Problems

1. Pleading issues fall into two groups mainly:

1) The underlying dispute is about the substantive law – what facts

justify relief for this kind of claim? – Haddle does here!

2) There is no dispute about the content of the substantive law, but

there is a disagreement about whether the facts pleaded justify

relief under that law. – Twombly goes here!

2. Think about “sloppy lawyer” and “hard law” cases. “Sloppy lawyer” means

the pleading is lacking one of the main elements of the claim, like forgetting

to plead causation; “Hard law” cases are cases where the lawyer has

pleaded whatever facts are known to her in support of the claim/ defense,

but she is not sure if it is enough.

Haddle is falls under the “hard law” case category. Twombly falls

under “sloppy law” case category.

3.

4.

5.

FRCP Supplement – pgs. __

Ashcroft v. Iqbal

--Facts

(P) alleges he was unconstitutionally arrested and imprisoned

• Question is about whether there was failure to state a claim – did

he plead factual matter that, if true, proves his constitutional rights

were violated?

--Procedural History

(P) files lawsuit alleging unconstitutional arrest and imprisonment.

(D)s move to dismiss on 12(b)(6) and district court denies. CoA

affirms denial. Now ruling is challenged in Supreme Court.

--Holding = claim is dismissed.

--Reasoning

Complaint does not require a bunch of detailed factual allegations,

but does require more than an unadorned “the-defendant-

unlawfully-harmed-me” accusation.

Complaint must contain sufficient facts to state a claim that is

plausible. Court asks for more than a possibility that the defendant

is liable based on threadbare conclusions and rules that plaintiff

must have stated more than legal conclusions in the complaint.

In this case, (P) needed to show that the government acted with a

discriminatory purpose – it is because race rather than in spite of it

--Dissent = agrees with the procedure used by the court, but not the result.

--Significance = how does the court go through the complaint?

Plaintiff must plead elements to state a claim under a theory.

However, just stating the elements as a legal conclusion is not

sufficient. The court does not have to accept the plaintiff’s legal

conclusions are true.

To survive a motion to dismiss, a complaint must contain sufficient

factual matter to state a claim to relief that is plausible on its face.

o A claim has facial plausibility when the plaintiff pleads factual

content that allows the court to draw the reasonable inference

that the defendant is liable for the misconduct alleged.

o Example: affidavits of people who witnessed a meeting, tapes

of something, official government documents, etc.

o You need something on which you can base your allegations

that will prove that this is more than a coincidence of the time

“Plausibility is not a probability requirement, but it is more than a

mere possibility”

--What do we take away from Twombly and Iqbal?

You will have to identify the elements you need to = these are legal

conclusions.

You have to include sufficient factual materials so that your claim is

plausible on its face – more than a possibility, but not necessarily a

probability

--Special Cases and Special Pleading Rules

FRCP Rule 9(b) fraud or mistake. In alleging fraud or mistake, a

party must state with particularity the circumstances constituting

fraud or mistake [specific]

o There are also some statutes that require plaintiffs to plead

with particularity

Stradford v. Zurich Insurance Co.

--Facts

(P) had previously notified (D) that on January 17, he returned to his

office and found water dripping from frozen pipes which caused

extensive water damage to his personal property and the interior of

his office. He submitted a revised claim under the Policy totaling

$1,385,456.70, consisting of $168,000.00 for property damage, and

a business interruption claim of $1,209,456.70.

Following an investigation of (P)’s claim, (D) disclaimed coverage for

(P)’s damages and demanded return of what it had already paid.

--Procedural History

(P) commenced this suit seeking the additional money from his

policy [FRCP Rule 8(a)]. (D) counterclaimed asserting that (P) had

made fraudulent claims [FRCP Rule 9(b)], and (P) was entitled to the

return of $151,154.74, punitive damages, and investigation

expenses.

(P) moved to dismiss the fraud counterclaims for failure to state

claims with sufficient particularity under FRCP Rule 9(b). (D)s

submitted a motion for leave to amend their counterclaim.

--Holding = (D)’s motion for leave to amend is granted. Once (D)s amend,

court grants their motion for summary judgment.

--Reasoning

(D)’s counterclaims do not satisfy the first sentence of Rule 9(b),

requiring that the “time, place, and nature of the alleged

misrepresentations” be disclosed to the party accused of fraud.

(D)’s counterclaim sufficiently asserts the general facts that allow

the inference that (P) had defrauded it, but (D) did not set forth with

particularity the allegations of the fraud.

o They need to include the more!

--Significance = Claims of fraud or mistake must be asserted with

particularity to provide the party against whom such claims are made fair

notice of the claim and the grounds on which it is based

Notes and Problems

3. Courts have dismissed fraud claims pursuant to Rule 9(b) even where the

pleader alleged specific communications because the claims lacked

particularized facts to support the inference that a party acted with

fraudulent intent.

4. In the average fraud cases, the fraud plaintiff’s lawyer wants to get to

discovery to uncover information proving that defendant was

misrepresenting the facts. But discovery will be unavailable if the complaint

is dismissed for failure to plead with sufficient specificity to comply with

FRCP Rule 9(b).

--Allocating the Elements of a Claim

In a system driven by party initiative, one must also ask which party

has the responsibility for which of those issues. In technical terms,

which “elements of a claim” must be part of the complaint by the

plaintiff, and which are “defenses” which the defendant must plead

in his answer?

As a general rule, whichever party has the “burden” of pleading an

issue must also produce evidence to demonstrate the allegation or

he will lose the case.

For the great majority of common claims, either a millennium of

common law cases or the applicable statute provide answers.

--Allocating the Elements [example]

A person who is injured by the negligence of another has a cause of

action against the person whose negligence caused the injuries

o Only the 4 basic elements are needed

A person who is not himself negligent, but who is injured by

another, has a cause of action against the person whose negligence

caused the injuries

o The plaintiff here would have to prove the 4 basic elements

but ALSO that he himself was NOT negligent

**The ways you know who has the burden of proof for pleadings can be

resolved by looking at statutes and cases.

If someone has the burden at trial to prove a certain thing, then he

most likely will have the burden to show it in his pleading

beforehand.

If you get to trial and a juror can’t tell based on the proof given,

then he will normally go along with whoever didn’t have the burden

of proof.

Jones v. Block – shows how the court deals with a new cause of action and

how the new cause of action should be dealt with

--Issue = what should a court do when an element set out in a statute is not

specified whether the burden of proof falls on Plaintiff or Defendant?

--Holding = defendant now ahs the burden of proof.

--Reasoning

Most courts view failure to exhaust as an affirmative defense

because Rule 8(a) only requires simply a short and plain statement

of the claim.

o The PLRA is not itself a source of the prisoner’s claim.

The PLRA dealt extensively with the subject of exhaustion, but is

silent on the issue whether exhaustion must be pleaded by the

plaintiff or is an affirmative defense.

**When a statute is silent on whether exhaustion is a burden on the

plaintiff or defendant, the usual practice should be followed. The

usual practice under the FRCP is to regard exhaustion as an

affirmative defense.

**Courts should generally not depart from the usual practice under

the FRCP on the basis of perceived policy concerns.A requirement of

greater specificity for particular claims must be obtained by

amending the FRCP.

o Specific pleading requirements are mandated by the FRCP

and not as a general rule through case by case

determinations of the federal courts.

--Court looked at the statute and made their determination.

Notes and Problems

1.

2. Why does it matter? Whoever has the burden of pleading an element of

the claim will also have the burden of producing evidence to demonstrate

that allegation.

If there is a lack of physical evidence of documents or paperwork,

then cases can follow testimony. If the trier of fact is unsure who’s

telling the truth, the outcome may turn on who has the burden of

persuasion, which usually follows the burden of pleading.

3. How does a court decide whether the burden of proving an element falls

under plaintiff’s complaint or an affirmative defense of defendant? There are

4 steps the courts use:

The court will first look at the words of the statute.

The court will also look at the Rule 8(c), which lists common

affirmative defenses. The list in Rule 8(c) is non-exhaustive. The

court will then ask if the statute in question provides that the

element could be considered an affirmative defense under Rule 8(c)

To answer the question above, the court can look at the legislative

history of the statute & take into account the normal practice of

courts in this situation – if exhaustion isn’t mentioned as an element

of plaintiff’s complaint, it will be an affirmative defense.

The court will also take into account a catalogue of cases dealing

with the same or similar issue.

4.

B. Ethical Limitations in Pleading & in Litigation in general

--FRCP Rule 11 guides the responsibilities of a lawyer to his client and the

legal system – it is basically the Honor Code for lawyers

Rule 11(b) states: By presenting to the court a pleading, written

motion, or other paper — whether by signing, filing, submitting, or

later advocating it — an attorney or unrepresented party certifies

that to the best of the person's knowledge, information, and belief,

formed after an inquiry reasonable under the circumstances:

o (1) it is not being presented for any improper purpose,

such as to harass, cause unnecessary delay, or needlessly

increase the cost of litigation;

o (2) the claims, defenses, and other legal contentions are

warranted by existing law or by a non-frivolous

argument for extending, modifying, or reversing existing law

or for establishing new law;

o (3) the factual contentions have evidentiary support or,

if specifically so identified, will likely have evidentiary

support after a reasonable opportunity for further

investigation or discovery; and

Reminds us of 8(a)

o (4) the denials of factual contentions are warranted on

the evidence or, if specifically so identified, are reasonably

based on belief or a lack of information

Rule 11(c) – if after notice and a reasonable opportunity to respond,

the court determines that Rule 11(b) has been violated, the court

may impose sanctions on the lawyer, the law firm, or the party that

violated the rule or is responsible for the violation

o 11(c)(2) – 21 days!!

o 11(c)(3) – court on its own motion sees that there is a

violation of rule 11 rule of to show cause.

Rule 11 restricts a lawyer’s ability to file a pleading when he has no

more than a hope that favorable facts or law will emerge as the

case progresses.

o Rule 11 regulates the way lawyers and clients conduct

themselves, establishing standards for investigation of law

and facts.

o If a lawyer or unrepresented party screws up any of the above

requirements, then he can be sanctioned.

“It is now clear that the central purpose of Rule 11 is to deter

baseless filings in district court and thus, consistent with the REA’s

grant of authority, streamline the administration and procedure of

the federal courts.”

Notes and Problems

1. A/B) No they can’t be sanctioned because it must be written, so phone

calls don’t count (whether it was a party who made the call or a lawyer). C)

No he cannot be sanctioned for a groundless interrogatory because it doesn’t

apply to discovery.

2. If the claim would not prescribe in 2 months, then yes the lawyer for

Plaintiff would be sanctioned under Rule 11 because it was not reasonable

under the circumstances not to investigate the plaintiff’s story. However, if

the plaintiff’s claim would prescribe the next day, he might not be sanctioned

by arguing that he didn’t have reasonable time to investigate because the

claim would prescribe before he could give evidence.

What about the client? Depends on the circumstances of time.

3. If the defendant finds that the plaintiff and his lawyer have filed a frivolous

complaint and he provides affidavits and documents, can he catch a

remedy? He can file a motion for summary judgment and then file a motion

for sanctions under Rule 11 two separate motions [Rule 11(c)].

21 days must pass before the filing of the second motion.

4. Rule 11(b) does not put an obligation on the lawyer to fix her mistake with

an amendment because at this time, she believed something else. If a

lawyer or party makes a mistake about the substance of a law, like the

statute of limitations running period, then he has to fix it on discovery in

order not be sanctioned by the court. IF he finds that after discovery she was

wrong, then he must fix it or else he will be sanctioned.

5.

Walker v. Norwest Corp.

--Facts

In a dispute over (P)’s trust fund, his guardian, attorney Massey

appeals from the district court’s award of sanctions against Massey

for filing a diversity case in which he failed to plead complete

diversity of citizenship and pleaded facts which tended to show

there was not complete diversity. 

Massey had not alleged a citizenship for many of the defendants

and did not identify which defendants should be dismissed to create

diversity jurisdiction. 

Upon receiving the complaint, (D)’s attorney informed Massey that

his complaint showed on its face that there was no diversity

jurisdiction and asked him to dismiss his claim or (D) would file a

motion for sanctions. 

o Massey did not dismiss and merely acknowledged (D)’s

correspondence. SO he did nothing.

--Holding = sanctions against (P) stand.

--Reasoning

Finding out the defendants’ citizenship is a burden on the plaintiff in

order to invoke [complete] diversity jurisdiction. 

Massey failed to show diversity and also failed to argue the point of

Massey’s financial circumstances, allowing for an award of

monetary sanctions- there was no abuse of discretion.

--Significance = normally a letter from the defendant is NOT enough!! Must

go by the rules set out in FRCPP Rule 11

Notes and Problems

1. Massey violated Rule 11(b)(2) because he filed a frivolous claim because

he didn’t even address the issue of diversity which was the sole basis of his

claim in federal court.

2. When a defendant wants to challenge the plaintiff’s complaint on the basis

that it violates any of Rule 11(b), he must first give a written notice to the

plaintiff of the deficiencies in his complaint and allow him 21 days to amend

his complaint [which plaintiff must file with the court]. If the plaintiff does not

amend his complaint, then defendant can file a motion to dismiss the claim

on basis on violation of Rule 11 (b) with evidence of the deficiencies; he can

then separately file a motion for sanctions against the plaintiff.

However, the defendant does not necessarily have to give written

notice to the plaintiff of his plan because a court has the power of

discretion to dismiss a plaintiff’s complaint based on violation of

Rule 11(b) and give sanctions to the plaintiff.

o A court does not have to impose sanctions though, and even if

it does, the sanctions do not have to be monetary sanctions

The plaintiff’s lawyer will have to pay the sanctions for a violation of

Rule 11(b)(2) as required in Rule 11(c)(5)(a) because he is

represented and lawyers should know the law before the file a

frivolous claim in court.

3. Rule 11 explicitly applies to defenses as well. Courts apply an objective

reasonableness standard to determine if Rule 11 has been violated.

Sanctions can be imposed on law firms, lawyers, or parties who are

responsible for the violation.

4.

Christian v. Mattell, Inc. [“cool blue” Barbie v. Claudine]

--Facts

Attorney Hicks brought suit on (P)’s behalf claiming that (D)’s Barbie

dolls infringed (P)’s doll sculpture copyright. The District Court found

that (P) should have discovered prior to commencing the civil action

that ’s dolls could not have infringed her copyright because (D)’s

dolls had been created well prior to her doll and (D)’s dolls had

clearly visible copyright notices on their heads.

After determining that Hicks had behaved “boorishly” during

discovery and had a lengthy rap sheet of prior litigation misconduct,

the District Court imposed sanctions. Under Rule 11, DC ordered

Hicks to pay (D) $501,565 in attorneys’ fees that it incurred in

defending against the frivolous action.

--Holding = DC was correct in determining the claim was frivolous, but

vacated the sanctions judgment.

--Reasoning

Rule 11 sanctions are limited to misconduct regarding signed

pleadings, motions, and other filings – not discovery abuses,

misstatements, etc.

The DC failed to make clear what specific conduct of Hicks’ it was

ordering sanctions pursuant to. Since the CoA was unable to tell

whether the misconduct being sanctioned occurred outside the

pleadings, such as in oral argument, at a meeting of counsel, or at a

key deposition, CoA had no choice but to reverse the sanctions

order given that Rule 11 sanctions are limited to misconduct

regarding filing of court papers.

To impose sanctions on behavior outside of Rule 11 under its

inherent authority, the court must make an explicit finding that

counsel’s conduct constituted or was tantamount to bad faith.

o Rule 11(c)(6) states that a court order imposing a sanction

“must describe the sanctioned conduct and explain the basis

for the sanctions”.

Notes and Problems

1.

2. Some states require that Rule 11 sanctions and similar litigation sanctions

must be reported to the state bar, which could then institute a disciplinary

proceeding against the lawyer.

3. Sanctions are supposed to be limited to what suffices to deter repetition of

the offending conduct = paying opposing side’s attorney fees, paying the

court for trouble; etc.

Nonmonetary sanctions, making a lawyer apologize, requiring the

lawyer to attend classes for CLE, etc.

C. Responding to the Complaint there are three possible responses to a

complaint: do nothing, make a pre-answer motion, or answer.

--Default: the understandable and unfortunate answer

A defendant who fails to respond to the complaint can have a

default judgment entered against him. There is an understandable

reason for this and an unfortunate reason

Understandable reason – this flows from the substantive law.

o Some cases, a defendant is not afforded many defenses in a

lawsuit. The defendant will either lose the lawsuit or pay a

lawyer to defend him that he doesn’t want to pay for if the

judgment will be entered against him anyway.

Unfortunate reason – a defendant may possess a meritorious

defense, but he either does not realize he has such a defense or he

knows but he cannot afford a lawyer.

Notes and Problems

1.

2.

3.

--Why file pre-answer motion instead of motion?

--Pre-answer Motion: think about Rule 7(a) and (b)

A defendant who does not default can simply proceed to answer the

complaint. In her answer, the defendant can include procedural and

substantive defenses.

Whatever the defendant places in her answer, she must respond to

the substantive allegations of the complaint. She must either

conceded or deny the allegations and her part in the events.

Unlike a pleading, a motion does not require a party to set forth her

version of he facts. Instead it is a request that the court take some

action in regard to the lawsuit.

o A pre-answer motion also stops the clock on the amount of

time a defendant has to answer a complaint with factual

evidence. LOOK THIS UP!!!!!

Rule 12(b) motions apply here, but since these motions can delay

the next stages of a trial, Rules 12(g) and (h) were put in place to

balance the availability of these defenses against the possible

abuse of these defenses.

o Rule 12(g) states that if you wish to file multiple motions

raising the defenses in 12(b), you must file them in one

motion in the suit.

If you do not, then you will lose the right to file the other

ones because you waived it.

The only ones you cannot waive are failure to state a

claim, failure to join an indispensable party, failure to

state a legal defense to a claim, and lack of SMJ.

o Rule 12(h)(1) A party waives any defense listed in Rule

12(b)(2)-(5) by omitting it from a motion in the circumstances

described in Rule 12(g)(2); or failing to either:

(i) make it by motion under this rule; or

(ii) include it in a responsive pleading or in an

amendment allowed by Rule 15(a)(1) as a matter of

course

Rule 12(e) – Motion for a More Definite Statement

o This motion asks the pleader to make more definite and

certain his contentions. However, this motion presently is

rarely and almost never successfully invoked.

If the claim is really vague, then it will be subject to a

Rule 12(b)(6) motion.

o The most frequent case this is used is when the pleader has a

fairly good idea what the claim is about but he wants to know

more about the precise nature of the pleader’s case

Rule 12(f) – Motion to Strike

o The motion to strike in its most common use allows a party to

challenge a part of the pleading that fails under the

substantive law, even though the rest of the pleading states a

claim or defense.

o In its other less common use, the motion to strike forces

removal or irrelevant and prejudicial allegations in a pleading.

o Courts will entertain a motion to strike any “redundant,

immaterial, impertinent, or scandalous matter” –

If the allegations in the complaint have no relation to

the case or unnecessarily confusing;

If the complaint is overly long and detailed;

If the allegations are unnecessarily derogatory

Rule 12(c) – Motion for Judgment on the Pleadings

o A plaintiff could move for judgment on the pleadings if the

defendant fails to deny any of the allegations in his pleading

[his defense is not a real legal defense to the allegations].

o The court essentially matches up the allegations of the

complaint and those of the answer, and it decides whether the

judgment for the plaintiff should be entered on the basis of

the pleadings.

o A case may also be decided on the pleadings alone if the

court believes the law is very clear and that further

development of the facts would not assist in deciding the case

--Answer: if the defendant cannot demurrer to the complaint or dispose of it

on the ground of Rule 12(b), she has to respond to the factual allegations.

Denials

o Rule 8(b) points out that a party can either admit, deny, or

deny because of lack of information.

o Rule 8(b) provides that a defendant only needs to deny those

allegations which he actually disputes; Rule 8(b)(6) provides

that any allegations not denied by the defendant is deemed

admitted by the defendant.

o The general denial is an allegation that denies each and every

allegation in the complaint.

However there are extremely rare cases in which the

defendant can plausibly deny each and every allegation.

A defendant who enters a general denial may well find

himself at the end of a Rule 11 inquiry because courts

tend to look down on these.

o The party should deny specific elements of the complaint if he

does not give a general denial.

Affirmative Defenses – Rule 8(c)

o Accord and satisfaction, arbitration and award, assumption of

risk, contributory negligence, duress, estoppel, fraud,

illegality, laches, license, payment, release, etc.

o The list given is not an exhaustive list; it is merely a list to

start with

The obligation is on the defendant to raise these along

with any claims to file.

An affirmative defense is more than just disputing the

plaintiff’s claims – it typically means that EVEN IF the

plaintiff’s claim is true, there are other facts that will bar

the plaintiff’s recovery.

o Affirmative defense is NOT admitting anything! Example: “I

deny the existence of contract, and in the alternative, even if

we had a contract, I fulfilled it….” Or state some affirmative

defense like award and arbitration, failure of consideration,

duress, etc.

There is a difference between a defense and a claim – a

claim asks for a remedy, whereas a defense does not.

So if you claim a defense in your counterclaim, the court

will allow it and change it to a defense.

--If you file a 12(b)(2) motion for lack of personal jurisdiction, you will include

an explanation with affidavits and depositions.

*if its incorporated, then you will include where the business is

incorporated, etc.

Zielinski v. Philadelphia Piers, Inc.

--Facts

(P) sued (D) alleging that a forklift owned by (D) caused (P)’s

injuries that occurred when (P) was in a collision with another forklift

on a pier involving one of (D)’s employees.

(D) asked its insurance company to answer that the complaint

should be filed against Carload Contractors because the forklift was

operated by an employee of Carload Contractors. (D) was also

aware of this error and investigated whether it and not Carload

Contractors owned the forklift.

o Johnson stated he was Defendant’s employee in his

deposition.

At a pre-trial conference over two and a half years later, (P) found

out that over a year before the accident, the business of moving

freight on the pier was sold from (D) to Carload Contractors

--Holding

--Reasoning

RULE: Under FRCP Rule 8(b), allegations in a complaint that are not

specifically denied are deemed admitted.

(D)’s general denial of (P)’s allegations that (P) was injured by a

forklift owned, operated, and controlled by (D) was ineffective

because (D) admitted in its letter to the insurance company that (P)

was injured by a forklift. In order to be effective, (D) must have

specifically denied ownership of the forklift.

Under the doctrine of equitable estoppel, (D) cannot take advantage

of (P)’s mistake when the mistake was perpetuated by (D)’s

inaccurate responses regarding ownership and agency

--Significance = This case illustrates the consequences of generally denying

allegations in a complaint. In this situation, estoppel is an additional ground

for deeming the facts to be admitted because Defendant knew that it did not

own the forklift yet failed to apprise Plaintiff of this fact.

In real legal practice, a complaint should always be answered

paragraph by paragraph

--Reply

WHAT TO DO ON EXAM

Personal jurisdiction – constitutional analysis

Does a traditional basis apply? Pennoyer

If so, then state that traditional basis by itself MAY be enough according to

Scalia’s theory in Burnham.

On the other hand, Brennan’s theory stated that you ALWAYS have to go

through minimum contacts

So then International Shoe test:

There must be a relevant contact between the defendant and the forum

state.

Purposefully availment: reach out to the forum and avail herself of the forum

in some way – make money, advertisement, etc.

Foreseeability: It must also be foreseeable that the defendant could get sued

in the forum state

Is this specific or general jurisdiction?

Does the plaintiff’s claim arise from the defendant’s contact with the forum?

Yes: Specific jurisdiction

No: general jurisdiction [defendant is domiciled or at-home + continuous and

systematic contacts]

Is it fair for the defendant to defend himself in a suit? The burden is on the

defendant to show that it is UNconstitutional to bring him into suit.

Burden/ inconvenience on the defendant [travel, witnesses, etc.]

Forum state’s interest in adjudicating the claim [McGee v. International

Life Insurance Co.]

The plaintiff’s interest in obtaining effective relief

Legal system’s interest in efficiency

Shared substantive policy [disharmony with families, etc.]

--When it comes to transfer, does the person moving for transfer have the

burden of proof that the transferee court has personal jurisdiction and proper

venue?

--States may have forum non-conveniens statutes. But when it comes to the

federal forum non-conveniens, they normally dismiss the case so that it can

be tried in a foreign court system.