Introduction - Harvard University



Table of Contents TOC \o "1-3" \h \z \u I.Introduction PAGEREF _Toc185059501 \h 1II.The Basics of Pleading and Rule 11 PAGEREF _Toc185059502 \h 2III.Preliminaries 1: Notice, Service of Process, Opportunity to be Heard PAGEREF _Toc185059503 \h 4IV.Preliminaries 2: (Subject Matter and Personal) Jurisdiction PAGEREF _Toc185059504 \h 8V.Preliminaries 3: Removal, Venue, Transfer of Venue, and Forum Non Conveniens PAGEREF _Toc185059505 \h 23VI.Pleading Special Matters, The Motion to Dismiss for Failure to State a Claim, and other FRCP 12(b) Motions PAGEREF _Toc185059506 \h 27VII.Expanding the Lawsuit: Joinder of Claims and Parties, and Amendments PAGEREF _Toc185059507 \h 30VIII.What Law to Apply? Erie (Vertical Choice of Law) and Horizontal Choice of Law PAGEREF _Toc185059508 \h 33IX.Discovery PAGEREF _Toc185059509 \h 38X.Summary Judgment – FRCP 56 PAGEREF _Toc185059510 \h 39XI.Trial by Jury and Motion for Judgment as a Matter of Law (Directed Verdict) PAGEREF _Toc185059511 \h 42XII.Post-Trial Motions PAGEREF _Toc185059512 \h 44XIII.Appeal PAGEREF _Toc185059513 \h 48XIV.Former Adjudication: Claim and Issue Preclusion PAGEREF _Toc185059514 \h 49XV.Class Actions PAGEREF _Toc185059515 \h 53XVI.Civil Procedure: Alternatives and Critique PAGEREF _Toc185059516 \h 55IntroductionSubstantiveThemesAdversarial principles of justice: the idea that individual litigants should have autonomy in shaping lawsuits and in moving claims to their ultimate resolution (total responsibility placed on the parties) Federalism: interplay between federal and state court systemsEfficiency/administrability vs. FairnessHow much “gamesmanship” to allow and how to deter it?Sources of Federal Law: Constituion; Federal statutes; FRCP (also FRE and FRAP)- promulgated pursuant to Rules Enabling Act, 28 USC § 2072; Circuit/local rulesProgression of a civil action in the federal system(First, selection of the proper court. Court must have SMJ, PJ, and proper venue.)Service of Process Summons + Complaint (Rules 4, 7, 8, 9, 15)Pre-Answer motions to dismiss (Rule 12(b))Answer (Rules 7, 8)Pre-trial Management (Rule 16)Discovery (Rules 26, 30, 31, 33, 34, 36, 37, 45)Summary Judgment (Rule 56)Trial (Constitution 7th Amendment, Rules 38, 48, 49, 51, 52)Motion for Judgment as a Matter of Law (aka Directed verdict) (Rule 50(a))Verdict + Renewed Motion for Judgment as a Matter of Law (aka Judgment notwithstanding the verdict JNOV) (Rule 50(b))Motion for New Trial (Rule 59)Judgment and EnforcementMotion for Relief from a Final Judgment, Order, or Proceeding (Rule 60(b))Appeal (FRAP)Preclusive Effect of Prior Decisions (Rule 41(b) and Claim Preclusion)TheoreticalRule vs. Standard: the consequences of a rule are triggered once we settle the facts; a standard requires a judgment about the facts before it kicks in.A Simple Introductory CaseFRCP 10(a): “In the complaint the title of the action shall include the names of the parties.” Sounds like a rule- rationale that lawsuits are public events and the public has a legitimate interest in knowing the pertinent facts.FRCP 10(a) in practice: Doe v. United States Life Insurance Company (SDNY 1988): P allowed to use a pseudonym in the action. Under special circumstances, courts have allowed parties to use fictitious names, particularly where necessary to “protect privacy in a very private matter” (Doe v. Deschamps SCOTUS). P’s privacy interest here in not being publically identified as a homosexual is strong enough to allow him to use a pseudonym. It will not hurt the D’s ability to defend itself for P to use a pseudonym. The Basics of Pleading and Rule 11The “old” Days: Pre-FRCPCause of action = a claim showing that the pleader is entitled to relief (a group of circumstances for which a court will grant relief)To win a lawsuit, a plaintiff has 3 obligations: 1) must state a claim for which they are entitled to relief (pleading obligation), 2) production burden (present sufficient evidence), 3) burden of persuasion (persuade the fact finder that each element is true)iii. 4 characteristics any pleading system has to determineWhat is the degree of specificity that the system demands in the pleadings (i.e. in order to survive a 12(b)(6) motion to dismiss for failure to state a claim)? To what degree does the system permit amendment?What is the penalty, if any, if there is a variance between what is plead and what appears at trial?To what extend are burdens historically borne by pleadings shifted to other procedural items?Prior to FRCP, there was the Writ System and then the Code System. The move to the FRCP system was a move towards emphasizing the notice-giving function over fact-revelation and issue-formulation. Pleading Basics in the FRCP SystemFairness v. Administrative concerns: The more technical a pleading system becomes, the more the “haves” win because they can hire lawyers. However, front loading the pleading system (like the writ and code systems previously) eases administrative concerns and gets rid of frivolous claims early. The ComplaintFRCP 8: a) a Pleading that states a claim for relief must contain 1) an allegation of jurisdiction, 2) statement showing that the pleader is entitled to relief, and 3) a demand for relief (what type of relief P wants). d) Pleadings are to be concise and direct; alternative statements are permitted; inconsistent claims or defenses are permitted. e) Pleadings must be construed so as to due justice. Complaint is made under FRCP 11, infra (you cannot lie)Forms and FRCP 8 suggest complaint should be brief.Responding to the Complaint by Answer (possibly followed by Reply)(Note, D can also respond to a complaint by filing a 12(b) motion to dismiss, which if that is denied, must be followed by an Answer)FRCP 7: Defines types of pleadings allowed (complaint, answer to a complaint, answer to a counterclaim, answer to a cross-claim, third-party complaint, answer to third-party complaint, and if the court orders, a reply to an answer)FRCP 8b: The Answer has three parts: 1) response directed to the complaint (admissions and denials); 2) affirmative defenses; 3) Defendant’s own claims (counterclaims) 1) Can deny for lack of knowledge or information (8(b)(5)), but courts frown upon abusing this. Denial can be specific or general (8(b)(3)). If D fails to deny an allegation that required a response, it is deemed admitted. If the allegation did not require a response, it is deemed denied or avoid. 2) If you fail to plead an affirmative defense in your answer, the old rule was that it was waved unless D amended the pleading; however most courts today allow Ds to introduce the affirmative defense later as long as P is not hurt by the late introduction. Defenses include lack of SMJ, PJ, etc. (all the 12(b) defenses can be included in an answer or in a separate motion to dismiss) 3) D’s own claims (counter/cross claims)- same rules of 8(a) governTiming: FRCP 12(a): A defendant must serve an answer within 21 days after being served with the summons and complaint, or if service is waived under 4(d), within 60 days after the request for a waiver was sent. (If you file a motion to dismiss instead, the answer is due 14 days from when the motion is denied/postponed, or if it is a 12(e) motion for more definite statement, it is 14 days from when that more definite statement is served.)Computing Time- 6(a)Rule 11 and the Truthfulness of PleadingsWhat stops parties from making stuff up in pleadings? FRCP 11 (governs all pleadings and motions, but not discovery). A) Every pleading must be signed by an attorney, or the party is the party is unrepresented. B) Representations to the court: 1) cannot be presented for any improper purpose, 2) the claims must be warranted by existing law or by a nonfrivolous argument for extending, modifying, or reversing law or establishing new law, 3) the factual contentions must have evidentiary support or will likely have support after further discovery (must be identified as such), and 4) the denials of factual contentions are warranted on the evidence or based on a belief or a lack of information (must be identified as such). C) Sanctions- discretionary. 11(c)(2) also provides a safe harbor provision, whereby if the party withdraws or corrects the thing for which it was going to be sanctioned within 21 days, no sanction. Chaplin v. Dupont Advance Fiber System (EDVA 2004): Ps brought suit for discrimination against Confederate Southern Americans. Grounds for FRCP 11 motion: 11(b)(1) improper purpose, 11(b)(2) lack of sufficient basis in law (Confederate Southern Americans not recognized as a race), 11(b)(3) lack of sufficient basis in fact. (Note, generally courts are reluctant to sanction on 11(b)(2) grounds because the purpose of lawyers/parties is to push the boundaries of law)Preliminaries 1: Notice, Service of Process, Opportunity to be HeardNoticeConstitutional Requirement: 5th/14th Amendment Due Process clause: No State (or federal court) shall deprive any person of life, liberty, or property without due process of law. We have a requirement of notice, because in order to have your opportunity to be heard (required by DP), you must be notified that an action affecting your rights is pending. SCOTUS’s interpretation of Constitutional Requirement:Mullane v. Central Hanover Bank & Trust (1950): The means employed of serving notice must be such as one desirous of actually informing the absentee might reasonably adopt to accomplish it. An elementary and fundamental requirement of DP in any proceeding which is to be accorded finality is notice reasonably calculated under all the circumstances, to apprise interested parties of the pendency of the action. The notice must be of such nature as reasonably to convey the required information and it must afford a reasonable time for those interested to make their appearance. Mullane established the use of a balancing (cost-benefit) analysis in determining whether the method notice used in constitutional under DP clauseJones v. Flowers (2006): government used certified mail to notify taxpayer of an impending sale of his property, but the notice was returned unclaimed. Court held the government should have taken “additional reasonable steps” once the mail was returned. Dissent says, this is not what the “reasonably calculated” standard of Mullane requires- actual notice is absurd. Green v. Lindsey: notice on door of public housing project not constitutional (children regularly remove postings, tenant never got it)Dusenbery v. US (2002): notice by certified mail to prisoner sufficient, even though prisoner never received the mail Wuchter v. Pizzutti (1928): invalidated NJ nonresident-motorist statute because it did not require the Secretary of State to notify the nonresident that an action was pending against him (compare Hess)Service of ProcessBasicsNotice is a constitutional requirement. SOP is the method used to satisfy notice in civil litigation (FRCP and state RCPs construction). Process consists of a copy of the P’s complaint and a summons directing the D to answer. FRCP 3: A civil action is commenced by filing a complaint with the court.Note on Statute of Limitations: Pursuant to FRCP 3, a suit “commences” when the complaint is filed with the court if the underlying COA is based on federal law. But if the underlying COA is based on state law, the state laws for commencement govern (may be when the D is served. See Erie cases, infra). If service is attempted promptly but improperly made, court can quash service and order P to re-serve (thus leaving commencement date for SOL purposes as the original filing), or dismiss the complaint and require P to re-file (then action has not commenced yet)FRCP 4: Provides rules for SOP. SOP is made by personal delivery of the summons and complaint to the D (if a corporation, see 4(h)(1)(B), personal delivery to an officer authorized to receive process. Has been liberally construed, see Insurance Co. v. S/S Hellenic, infra). d) Waiver of SOP: P may send D a waiver form, D has 30 days to return the waiver. If D waives SOP, then D gets 60 days to respond (rather than usual 21 days). If D refuses to waive SOP, then D will be charged cost of formal service. m) P has 120 days after the complaint is filed to serve D. Otherwise, complaint is dismissed without prejudice. FRCP 12(b): A party may assert as a defense insufficient process (4) or insufficient SOP (5). Insurance Co. of North America v. S/S Hellenic Challenger (SDNY 1980): Service of a claims adjuster at the office of the D corporation, even though the adjuster was not expressly authorized by D to accept process, was sufficient to satisfy FRCP 4(h)’s requirements. The rules governing SOP are to be construed in a manner reasonably calculated to effectuate their primary purpose: to give the D adequate notice that an action is pending. The rule does not require service to be made solely on a restricted class of formally titled officials. Return of Process: After serving the D, process-server files a return as proof of service. This is required in order to enable the trial court to conclude it has jurisdiction. The return is conclusive evidence that service has been effected, even if process-server did not actually serve: Meidrich (1914): SC upheld a mortgage foreclosure action even though the person was never served, the sheriff lied and said he did. Why? The party serving the complaint did everything they were supposed to do. Immunity and EtiquetteImmunity: to promote the administration of justice, attorneys, parties, and witnesses in a state for one lawsuit are generally immune from SOP in other suitsEtiquette: You cannot trick someone into coming to a state in order to serve themWyman v. Newhouse (2nd Cir. 1937): Judgment procured in FL through fraudulent means of inducing D into state (P lied and told D her mother was sick in order to get him to come to the state, then served him) not enforceable in NY. Courts balk at the idea of fraudulent inducement to their jurisdiction (means of obtaining tag PJ), but if the D is already in the jurisdiction, parties can use trickery to induce them out of hiding. Opportunity to be HeardDeprivations by the StateGoldberg v. Kelly (1972): Welfare is property. Before an individual can be deprived of welfare benefits, a pre-termination hearing is required by DP clause. “Against the justified desire to protect public funds must be weighed the individual’s overpowering need in this unique situation not to be wrongfully deprived of assistance.” What constitutes an opportunity to be heard “must be tailored to the capacities and circumstances of those who are to be heard.” Opportunity to be heard must be at a “meaningful time” and in a “meaningful manner” (tailored to parties i.e. for welfare, should be oral hearing)Mathews v. Eldridge (1976): Pre-termination evidentiary hearing not required prior to termination of Social Security benefits. Distinction from Goldberg- “there is less reason here than in Goldberg to depart from the ordinary principle that something less than an evidentiary hearing is sufficient prior to adverse administrative action.” (Social Security beneficiaries aren’t as poor as welfare recipients, and probably have other sources of income. Risk of erroneous deprivation is less, because decision primarily based on medical records.)Mathews balancing test: Factors to consider: 1) the private interest that will be affected by the prejudgment attachment, 2) the risk of erroneous deprivation through the procedure under attack and the probable value of additional or alternative safeguards, 3) the interest of the other party/government’s interests, including the fiscal/administrative burdens that the additional procedural requirement would entailDeprivation by “Private” IndividualsFRCP 64 allows parties to use any form of remedy that is available in the state where the court sits for seizing a person or property to secure satisfaction of the potential judgment. Possible remedies include: arrest, attachment, garnishment, replevin, and sequestration. To what extent does the DP clause impose limits on the use of “provisional remedies” (FRCP 64 remedies) because they to not provide Ds an adequate opportunity to be heard prior to the deprivation?: (Fuentes and Doehr). Same requirements/considerations as deprivations by the State. Fuentes v. Shevin (1972): Simultaneously with instituting an action for repossession of appliances, and before P had received a summons to answer its complaint, company obtained a writ of replevin ordering a sheriff to seize the disputed goods. State statutes that fail to provide a hearing before a creditor can replevy goods from a defaulting debtor are unconstitutional under 14th amendment DP clause, because they provide no notice or opportunity to be heard before seizure (no Goldberg meaningful time or meaningful manner). A temporary, non-final deprivation of property is still a “deprivation” w.r.t. 14th amendment, which protects “any significant property interest” (so although P did not owe the goods yet, so it wasn’t their “property”, their interest is still protected).Dissent: Antagonistic interests of buyer and seller make it reasonable to immobilize the property during the resolution of the dispute (seller has interest in property not being damaged during lawsuit). Also, this decision will have little impact because creditors can include provisions in contract requiring buyers to waive right to a pre-seizure hearing upon default. Note: “extraordinary situations” (i.e. strong governmental or general public interest) can justify postponing notice and opportunity to be heard. Not present in this case. Connecticut v. Doehr (1991): State statute that authorizes prejudgment attachment of D’s house without prior notice or hearing, absent extraordinary circumstances and with no requirement that the person seeking attachment post a bond, does not satisfy DP. While not the same as a complete deprivation of property because it does not deprive D the use and possession of his property, the attachment has significant consequences for owner and thus triggers DP protection. Considering the three Mathews factors, no exigent circumstances to justify not having a pre-attachment hearing, require notice and opportunity to be heard prior to attachment.Note: case distinguished from Shaumyan v. O”Neill where the 2nd circuit allowed prejudgment attachment of home in homeowner/contractor dispute because the property was relevant to the dispute (here, P had no prior interests in D’s home- battery case)Contemporary Application: Enemy CombatantsHamdi v. Rumsfeld (2004): What process is constitutional due to a US citizen who seeks to challenge his classification as an “enemy combatant”? Majority: Considering Mathews factors, strong interests on all sides (government’s interest in ongoing war effort and Hamdi’s interest in being free from confinement). Creates new procedural process- the citizen-detainee must receive notice of the factual basis for his classification and a fair opportunity to rebut the government’s factual assertions before a neutral decisionmaker, but government can rely on hearsay testimony and place burden of proof on detainee in a military tribunal rather than a court. DP, in a very restricted manner. Dissent: Unless the writ of habeas corpus is suspending (which Constitution allows Congress to do), the government either has to bring criminal charges or release the detainee. Majority has made up a new procedure, departing from any prior model of DP.Introduction to Remedies: Preliminary Injunctions and TROsFRCP 65: (a)(1) The court may issue a preliminary injunction only on notice to the adverse party. (b) includes the rules of temporary restraining orders. They can be issued without written or oral notice to the adverse party or its attorney only if facts show immediate and irreparable injury would result without it.Chaplaincy of Full Gospel Churches v. England (Secretary of the US Navy) (DC Cir. 2006): P alleged that D’s practice of retaining overage Catholic chaplains constitutes a denominational preference in violation of the Establishment Clause of the 1st Amendment (claiming government was establishing a national religion), inter alia. To warrant a preliminary injunctive relief, the moving party must show (1) a substantial likelihood of success on the merits, (2) that it would suffer irreparable harm if the injunction were not granted, (3) that an injunction would not substantially injure other interested parties, and (4) that the public interest would be furthered by the injunction. Held- a violation of the Establishment Clause inherently constitutes irreparable harm. (reverse denial of P’s motion for preliminary injunction and remand). The claim of employment discrimination does not justify a preliminary injunction because it is not irreparable harm. Also, a claim of a violation of the 1st Amendment doesn’t automatically constitute irreparable harm for which a preliminary injunction will be granted; P must show “chilling effect” if claiming his speech is being limited. But here, there is no “chilling effect” because the harm is being done by the government (has already happened).Preliminaries 2: (Subject Matter and Personal) JurisdictionOverview and TheoryThe Three Rings: SMJ: Which system (federal or state)?PJ: Which state in the system (MA fed or CA fed? MA state or CA state?)Venue: Which court in that state in that system (SDNY or EDNY?)Jurisdiction is the power to declare the law.SMJ is the power of the federal (as opposed to state) courts to decide certain kinds of cases. It is power to declare law on the matter.PJ is power over the person.Forum shopping, given concurrent v. exclusive jurisdictional grants to federal courts: which is preferable, state v. federal judges?The Constitution and JurisdictionArticle 3: authorizes establishment of the federal courts system. Sec. 2 sets the limits of federal judicial authority. (judicial power of US shall extend to all cases “arising under” this Constitution and Laws of the US)Article 4, Sec. 1: requires that “full faith and credit be given in each State to the judicial proceedings of every other State” if the court rendering them had jurisdiction to do so.14th Amendment, Sec. 1: Due Process (combined with Pennoyer PJ)Subject Matter JurisdictionIntroductionFederal courts are courts of limited jurisdiction: they only derive their jurisdiction from the Constitution (Article 3, Sec. 2) and federal statutes. There is a constitutional storehouse of areas where federal courts could have jurisdiction and then Congress decides what areas federal courts do have jurisdiction. Constitutional storehouse: Article 3, Sec. 2: defines the jurisdiction of federal courts: all cases arising under the Constitution or federal laws, cases affecting ambassadors, admiralty and maritime, cases where the US is a party, controversies between two or more states, controversies between a state and a citizen of another state, controversies between citizens of different states, controversies between states and foreign countries, and controversies between citizens of the same state claiming lands in different states.Two main types of federal SMJ: 1) those “arising under” Constitution/federal laws and 2) controversies between citizens of different states (diversity)Diversity JurisdictionThe Statute and Theory28 USC §1332: a) Federal courts have jurisdiction in controversies between citizens of different states (and citizens of a State and citizens or subjects of a foreign state- alienage jurisdiction) when the AIC exceeds $75K. b) For purposes of SMJ, a corporation is a citizen of 2 states, where it is incorporated and where it has its principal place of business.Insurance company is deemed a citizen of whatever state the insured is a citizen of. Complete diversity required (if 1 P, 2 Ds, P must be diverse from both Ds- Strawbridge rule)Theory: Protect out of state litigants. Critique: Is this necessary, and it requires federal judges to interpret state law. Amount in ControversyAFA Tours Inc. v. Whitchurch (2nd Cir. 1991): “It must appear to a legal certainty that the claim is really less than for the jurisdictional amount to justify a dismissal.” (see St. Paul Mercury). If the P claims the AIC exceeds $75, strong deference to P. Punitive damages are included in calculation. Aggregation rules: 1P can aggregate its claims against 1D in order to satisfy the AIC (even unrelated claims). But 1P cannot aggregate its claims against multiple Ds. Multiple Ps can only aggregate if they share a common and undivided interest against same D (usually not the case, so if no P individually meets the AIC, cannot aggregate). See Exxon Mobile and supplemental jurisdiction later for when a P with an insufficient AIC can tag onto a P with a sufficient AIC against same D. How to value an injunction in calculating AIC? McCarty v. Amoco 7th Cir. 1979: A federal court may view the jurisdictional amount from the perspective of either party individually, or both, and if any perspective exceeds FRCP requirement, AIC met for jurisdictional purposes. Diversity of PartiesCitizenship is determined according to the date the complaint is filed. The party seeking to assert federal SMJ bears the burden of proving diversity of citizenship. Complete diversity required (Strawbridge rule).Citizenship for a person = domicile (not residency). Domicile is where you are born, unless i) you move to a new place ii) with an intention to stay there indefinitely. Ochoa v. PV Holding Corp. (EDLA 2007): D while driving a rental car in LA hit P (LA domiciliary). P sued D and rental car company in LA state court. Rental car company wanted to remove to federal court, based on diversity of citizenship. Issue: Is D, a Katrina refugee living in TX, a LA domiciliary? Held- yes (remand to state court). Here, D rental car company failed to show how D was a domiciliary of TX. Examples of possible proof of changed domiciliary: driver’s license, own property, bank statements, taxes Citizenship of a corporation = 1) where it is incorporated, and 2) where it has its PPB = nerve center test i.e. locus of corporate decision-making authority (HQ) (Hertz v. Friend 2010)Citizenship of a partnership (law firms, etc.) = citizen of every State where one of its members is a citizen (hard to get diversity against a partnership)Class action: citizenship of class representative(s) is considered in determining whether case may be brought in federal court SMJCitizenship of aliens = permanent resident aliens are deemed citizens of the State in which the alien is domiciled. But citizens of foreign States are considered all citizens of the same “alien foreign state”, so if both P and D are aliens, no diversity (cannot bring case in federal court)- dictum in Ruhrgas Ag (1999) where SCOTUS stated aliens on both sides of the action “rendered diversity incomplete.”Gamesmanship attempts to create or destroy diversity have been rejected by courts. “Manufacturing of federal jurisdiction” not permitted by reassigning interests (Kramer v. Caribbean Mills (1969)). See also Rose v. Giamatti (SDOH 1989): P tried to destroy diversity by naming another non-diverse D who wasn’t really a party; court would not allow. Judicially Created ExceptionsEven if the normal requirements for diversity jurisdiction are met, federal courts have typically declined to hear domestic relations and probate casesDomestic relations exception: Ankenbrandt v. Richards (1992): SCOTUS upheld federal district court jurisdiction to hear the case of an ex-wife suing her husband for sexual abuse of their daughters. The domestic relations exception only applies to divorce, alimony, or child custody.Probate exception: Marshall v. Marshall (2006): SCOTUS said federal jurisdiction was appropriate where widow was seeking damages for a widely recognized tort (interference with her husband that caused him to leave nothing to her in will) that did not interfere with the state probate proceedings. Rationale for domestic relations and probate exceptions to federal SMJ? State courts are more connected to people, have special expertise in familial issues. Criticism: doesn’t allow for cross-pollination of ideas.Class Actions & Mass TortMinimal diversity = 1 P is a citizen of a different State from 1 DMass Torts (Multiparty, Multiforum Act 2002): grants federal SMJ in mass accidents where at least 75 persons die and there is minimal diversityCAFA 2005: grants federal SMJ for any class action where aggregate AIC exceeds $5M and there is minimal diversity, with exceptions (1/3, 2/3)Federal QuestionThe Theory and the Constitutional GrantArticle 3, Sec. 2: The judicial power of the US shall extend to all cases, in law and in equity, arising under this Constitution, US laws, and treaties.Theory for FQ jurisdiction for federal courts? Uniformity of federal statute interpretation, protect people against state courts hostile to federal law claims, incentive to state courts to properly interpret federal law (in competition with federal courts)Broad construction of the meaning of arising under w.r.t. the Constitution (Art. 3, Sec. 2): Osborn v. Bank of the United States (1824- pre-passage of §1331): Congressional act that chartered the Bank authorized it to “sue and be sued” in any federal district court. OH state auditor challenged its ability to sue OH in federal court (said it lacked SMJ). Held- Congress may confer on the federal courts jurisdiction over any case or controversy that might call for the application of federal law. If a federal “ingredient” exists, the grant of federal SMJ is constitutional. The Statutory Grant28 USC §1331 (passed in 1875): The district courts shall have original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the US.Note: federal SMJ can be concurrent or exclusive (assume concurrent unless statute explicitly states otherwise). The Well-Pleaded Complaint RuleLouisville & Nashville R. Co. v. Mottley (1908): A suit “arises under” the Constitution and the laws of the US (in terms of §1331) only when the P’s statement of his own COA shows that it is based upon those laws or that Constitution. (cannot anticipate D’s federal law based-defenses). Ask whether P would have to raise the federal issue in a complaint which includes only the elements she needs to establish her claim. The FQ must be presented in the complaint (not counterclaims or defeneses). Declaratory Judgments: Skelly Oil Co v. Phillips Petroleum Co. (1950): invert case prior to Mottley analysis- imagine if the case was brought as a regular suit for damages rather than a declaratory judgment, would that complaint have a federal question. Artful pleading (i.e. inserting or removing a federal question into complaint in order to create or destroy federal SMJ) not permitted:Bright (9th Cir. 1986): P framed his complaint as a breach of employment contract (state law). D successfully removed the case to federal court, saying that the P was craftily denying his true challenge to D’s compliance with federal law.But note, you can decline to bring federal law claims to avoid federal court and only bring state law claims. (but you cannot pretend your claim is something it is not).Rationale for constrained meaning of “arising under” w.r.t. §1331 (compare broad meaning of “arising under” w.r.t. Constitution in Osborn): reaction to overloading of federal court system. The Meaning of “arising under”Asks question: What is enough to make a case “arise under” federal law for purposes of § 1331 (given that it is in the complaint, according to the well-pleaded complaint rule)?Holmes creation test: (original rule) “A suit arises under the law that creates the COA.” If the COA is created by federal law (i.e. Congress passes a statute giving you this COA), then it “arises under” federal law. If instead the COA is created by state law, then the case “arises under” state law.Departure from Holmes creation test where COA is created by federal law but does not “arise under” federal law (narrow exception, rarely comes up).Shoshone Mining Co v. Rutter (1900): federal SMJ not appropriate. While a federal statute creates the COA, the resolution of the dispute relies upon “local customs or rules” (as stated in the statute), so the suit to determine the right to possession may not involve any construction of a federal law.Departure from Holmes creation test where COA is created by state law, but there exists the presence of a federal issue in the state-created COA. (when is federal SMJ permitted)Pre-Merrell Dow:Smith v. Kansas City Title (1921): held federal SMJ was appropriate where state law created the COA, but the principal issue was the federal constitutionality of the bond issuance. P had COA to enjoin investing in certain federal bonds based on a MO state law, but his rationale for the injunction was that the Congressional statute authorizing the issuance of the bonds was unconstitutional. (if you claim something is unconstitutional within your complaint, likely to allow federal SMJ). Moore v. Chesapeake & Ohio Railway (1934): P brought an action under KY state law against his employer D for work-related injuries, which held that P cannot be responsible for contributory negligence in an employer liability case if D violated any state or federal employee-safety laws. P alleged D failed to comply with federal safety statute. Held- no FQ SMJ. This is a state law negligence claim, does not matter that the claim is premised on the breach of a duty imposed by a federal statute. (Reconcile this case with Smith- whether federal courts have FQ SMJ turns on the nature of the federal interest in the case. SCOTUS cares about the constitutionality of its statutes, in Smith, but not state law negligence, in Moore). The Trilogy: Merrell Dow, Grable, & Empire HealthcareMerrell Dow Pharmaceuticals v. Thompson (1986): If the federal element in the state law COA is the violation of a federal statute, which does not create a private right of action, there is no FQ SMJ. Here, P had 6 theories of liability (drug caused children’s deformities), one being negligence, and the P claimed breach (within negligence claim) through negligence per se based on D’s violation of a federal statute (FDCA). But the FDCA does not create a private right of action i.e. private individuals cannot sue for violations of the FDCA. Court holds- no private right of action = no FQ SMJ. (similar to Moore- claiming violation of a federal statute with a state law COA does not give you FQ SMJ). Why? The Congressional determination that there be no federal remedy for violations of this statute is equivalent to a decision by Congress that violations of the federal statute are not “substantial” enough to confer FQ for SMJ. Why deny FQ SMJ? Increased complexity and amount of litigation in federal courts and more careful scrutiny of legislative intent required to determine if Congress wanted there to be FQ SMJ. Slight expansion of Holmes creation test: If FDCA had created a private right of action, P could have brought its case in federal court, even though the claims would still be state law negligence. Dissent: Criticizes the majority’s equation, stating that it only makes sense if the reasons Congress has for not creating a private right of action are the same reasons as why to deny federal SMJ. Why grant FQ SMJ? Uniformity and expertise of federal courts in interpreting federal law. We should want federal courts to deal with complex litigation, restricting amount of litigation is not our job (for Congress to do), and weird to read statute as creating state PROA, but not federal PROA. Agrees with Smith, not Moore. Grable and Sons v. Darue (2005): Does the Merrell Dow equation always hold (i.e. require a federal COA to get FQ SMJ over a state law claim that may turn on the construction of a federal law)? NO. Held- FQ SMJ will lie over state law claims that implicate significant federal issues. (Facts: P brought a quiet title action, a state law action, saying that D’s title to property was invalid because the IRS did not comply with the exact manner of the statutory notice requirement- it delivered notice by certified mail, not in hand delivery. Allow FQ SMJ). Court distinguishes Merrell Dow. Test: “The question is, does a state-law claim necessarily raise a stated federal issue, actually disputed and substantial, which a federal forum may entertain without disturbing any congressionally approved balance of federal and state judicial responsibilities. (Sounds like Smith- if federal interest is substantial, FQ SMJ allowed- federal courts have to want to decide the case, if you claim something is unconstitutional or a federal agency violated a federal law, can get FQ SMJ)[Similar to FN 12 in Merrell Dow, this case suggests that the real consideration to reconcile all the cases on when a state-law-created COA can be brought in federal court might be the nature of the federal interest. Criticism: ad hoc way to determine SMJ] No clear-cut rule- balance federal interest, substantial-ness of the federal issue, and “opening the floodgates” concernsEmpire Healthcare Assurance v. McVeigh (2006): FQ SMJ denied. (Facts: insurance company sued federal employee’s estate to recoup what it had paid for his medical expenses after estate successfully sued the person who injured him in wrongful death action). Statute governing the federal employee health care is silent on recoupment. Says Grable is a small and special category where there is a substantial federal interest. No strong federal interest here with private parties suing other private parties in recoupment, state law claim and Congress was specifically silent on PROA. Supplemental Jurisdiction (What jurisdictionally insufficient claims can we attach?)How we got hereTwo types of supplemental jurisdiction: Pendent jurisdiction (when a P adds a claim for which there is not federal SMJ to a claim for which there is) and Ancillary jurisdiction (when a P or D attaches a jurisdictionally insufficient counterclaim, cross-claim, or third party claim to a jurisdictionally sufficient one. Usually not discretionary, we will see later in course).Constitutional power: Art. 3, Sec. 2: “Cases and controversies”Interpretation of Constitutional power: United Mine Workers v. Gibbs (1966): Common nucleus of operative fact (CNOF) = constitutional test for supplemental jurisdiction. Under the Constitution, “cases” and “controversies” means deriving from a CNOF. Federal court power over state claims, termed “pendent jurisdiction” exists wherever the relationship between a federal and state claim justifies a conclusion that the entire action before the court is one “case” (i.e. derived from CNOF). Note: pendent jurisdiction is discretionary, not a right. Court can decide not to hear the state law claims or to separate the case. Application- pre-§1367 cases:Aldinger v. Howard (1976): P who asserted a federal law claim against one D and a state law claim against another D not permitted to sue in federal court even though the two claims derived from a CNOF (P alleging civil rights violations against police and municipality), because the federal statute authorizing P to sue D1 (police officers) specifically does not include D2 (municipalities). Congress specifically did not want municipalities to be included here in federal court. (Note, case is not a statement about supplemental jurisdiction, just an interpretation of a specific statute. In general, federal courts like pendent claim jurisdiction, hesitant to use pendent party jurisdiction). While there is constitutional power to hear the case (Gibbs CNOF), case here lacks statutory authorization. Overruled by §1367.Owen Equipment v. Kroger (1978): For diversity cases, you cannot use supplemental jurisdiction to circumvent the Strawbridge interpretation of §1332 where complete diversity is required. If you add a party that destroys complete diversity, no federal SMJ (just reaffirming Strawbridge, codified in §1367). (moving river changed the location of D2 during course of litigation)Finley v. United States (1989): P brought suit against FAA under FTCA, later amended complaint to include state law claims of negligence against City of San Diego and local utility company (not diverse citizenship, but remember, the anchor claim here is FQ SMJ). Held- no supplemental jurisdiction for these parties. Gibbs allows additional state law claims, but not parties. Dissent (Stevens): This case is different from Aldinger, because the statute explicitly rejected the inclusion of municipalities, but here, FTCA is merely silent on the issue. Plus, now we must split the claim (not required in Aldinger where both claims could be brought in state court) because the FTCA gives exclusive jurisdiction to federal courts. (§1367 overrules Finley). The Current State of the Law (statutory authorization of supplemental jurisdiction)Remember, Constitutional grant of supplemental jurisdiction is CNOF test.28 USC §1367: A) In any civil of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to the claims in the action with such original jurisdiction that they form part of the same case or controversy under Article III of the Constitution. (CNOF test) Such supplemental jurisdiction shall include claims that involve the joinder or intervention of additional parties. B) In a civil action where district courts have original jurisdiction based solely on §1332 (diverse + AIC), the district courts shall not have supplemental jurisdiction over 1) claims by plaintiffs against persons made parties under Rule 14 (third-party practice), 19 (compulsory joinder), 20 (permissive joinder), or 24 (intervention) of the FRCP, or 2) over claims by persons proposed to be joined as plaintiffs under Rule 19 (compulsory joinder), or 3) persons seeking to intervene as plaintiffs under Rule 24 (intervention), when exercising supplemental jurisdiction over such claims would be inconsistent with the jurisdictional requirements of §1332. C) (discretionary) District courts may decline to exercise supplemental jurisdiction over a claim if 1) the claim raises a novel or complex issue of State law, 2) the claim substantially predominates over the claim or claims over which the district court has original jurisdiction, 3) the district court has dismissed all claims over which it has original jurisdiction, or 4) in exceptional circumstances there are other compelling reasons for declining jurisdiction. A) says if court has FQ SMJ, it can assert supplemental jurisdiction over all other claims and parties as long as CNOF. B) if federal court has SMJ only because of diversity, see exceptions (namely, cannot join parties who destroy diversity, but can join a P party whose claim against D is less than AIC if original P has required AIC- see Exxon Mobile). Counterclaims that are below AIC are allowed.Steps to determining if federal court has supplemental jurisdiction1st step: original federal SMJ (FQ SMJ or diversity- anchor claim)2nd step: constitutional authority: CNOF between claims/parties Gibbs3rd step: statutory authorization (1367a/b)4th step: discretion of the court (1367c)Intermission: Exxon Mobil Corp. v. Allapattah Services (2005): Court holds that §1367 allows for federal SMJ in diversity cases where parties are joined under Rule 23 who do not meet the AIC if one of the parties does meet the AIC (against the same D). But federal courts do not have supplemental jurisdiction over claims brought by 1 P against multiple Ds (Rule 20) where AIC is met against 1D but not against D2. If complete diversity of citizenship is destroyed by the joining of plaintiffs or defendants, no SMJ- destroys the original jurisdiction under 1367(a)- contamination idea. Personal JurisdictionSummaryPJ asks the question: the courts of which states within a system can hear a case- only those with PJ over the defendant.A court’s PJ power is restricted by the DP clause of the Constitution and by statute.Three types of PJ: In personam (jurisdiction over the person, only one that receives full faith and credit in other states, so the judgment can be executed in a different state), in rem (jurisdiction over assets i.e. property within the state – case must be related to the property), quasi in rem (judgment is rendered against the person, but recovery is limited to property within the state)For in rem and quasi in rem, the property must be within the state and must be attached before the instigation of the suit or immediately thereafter. The attachment thus serves as notice (Pennoyer). Three Step Approach to PJDoes a traditional basis of jurisdiction apply? If yes, PJ is satisfied. If no,Does the state’s long arm statute purport to reach the D in this case? If no, no PJ. If yes,Is the assertion of PJ constitutional in this case? (DP inquiry)DP Inquiry: International Shoe: minimum contacts + fair play and substantial justiceTraditional Bases Pennoyer (these are all considered constitutional)The theory behind PJ is that 1) a state is all powerful within its borders and 2) a state is completely helpless impotent outside its borders (Pennoyer). PJ is a question of horizontal federalism. Traditional bases of in personam PJ: presence, domicile, agency, and consentPresence- tag jurisdiction, if person is in the state and serve process, PJ (Pennoyer)Domicile- a state has PJ over a domiciliary even if the person is not in the state (see Blackmer where American citizen was served in France, Miliken where WY citizen was served in CO)Agency- in personam PJ over a D who has an agent appointed to receive SOP in the state. A state can require a nonresident entering into a partnership or association within its limits to appoint an agent or representative of the State to receive SOP. Rule 4(h)(1)(B) companies and agents.Consent- A defendant can be subject to in personam PJ if she appears there in (i.e. appears in court and does not contest PJ)Express consent- contracts may have a consent to jurisdiction clauseImplied consent- Appointing an in-state agent (nonresident motorist statutes are constitutional, see Kane v. NJ 1916, motorists required to appoint and in-state agent to receive process and Hess v. Pawloski 1927- use of the roadways implies that you consent to Secretary of State receiving process for you for actions related to D’s driving in the state. This is constitutional because D receives notice through the mail and D gets to use the roads, but must pay for harm caused while doing so. Not general PJ, just for acts related to D’s benefit of using the roads)The Modern Doctrine and the Constitutional Limits of Due Process(The traditional bases are fine for persons, but what about corporations? What does it mean for a corporation to be “present”? When can we imply implicit consent? Could say that businesses impliedly consent by doing business in the state (like Hess), but then what does it mean to “do business” in the state? Becomes its own test.)International Shoe Co. v. Washington (1945): Holding: Due Process (the Constitution) requires that the D have some “minimum contacts” with the forum state such that the exercise of jurisdiction does not violate traditional notions of fair play and substantial justice”. (Facts: solicitation of orders for purchase of shoes within the state through salesmen was enough to render in personam jurisdiction over the corporation.) Reciprocity argument: To the extent that a corporation exercises the privilege of conducting activities within a state, it enjoys the benefits and protections of the laws of that state. The exercise of that privilege may give rise to obligations, and so far as those obligations arise out of or are connected to the activities within the state, a procedure which requires the corporation to respond to a suit brought to enforce them can, in most instances, hardly be said to be undue. International Shoe establishes another basis for PJ: minimum contacts +FPSJ3 poles of possible in pesonam PJGeneral in personam PJ (rare- Goodyear): continuous and systematic contacts within a state justifying PJ over claims not related to the contactsSpecific in personam PJ: this is the inquiry of International Shoe- look to the quality and nature of the activity in relation to the fair and orderly administration of the laws which it was the purpose of the DP clause to insure. No PJ: assertion of PJ would be unconstitutional where “the casual presence of the corporate agent or even his conduct of a single isolated items of activities in a state on the corporation’s behalf are not enough to subject it to suit on COA unconnected with the activities there”Introduction to Long Arm Statutes: State Long ArmsRemember, to exercise PJ, it needs to be constitutional and authorized by a statute. Traditional bases (Pennoyer) are constitutional and authorized by state long-arm statutes (assume). International Shoe established a constitutional basis for the exercise of PJ that focused on the nonresident’s activities or contacts within the forum state. Following International Shoe, states enacted long-arm statutes which authorized their courts to exercise jurisdiction over nonresidents who engaged in certain enumerated acts within the state. Some state long-arms say “a court may exercise jurisdiction on any basis not inconsistent with the Constitution of this state or the US.” The long-arm is coextensive with Due Process, so the question of statutory authorization and DP constitutionality are the same. Example: Gray v. American Radiator (IL 1961): P’s water heater explodes and hurts her in IL, she sues Titan (among others) in IL, Titan is a foreign corporation with an agent in OH. IL statute says “a nonresident who commits a tortious act within this State submits to jurisdiction.” What does it mean to commit a tort within a State? Held- D did commit a “tortious act” in IL since the water heater explodes in IL (injury in IL). Since the tort was committed in IL, D is subject to PJ in IL (according to statute- still need to inquire into whether it is constitutional) More on General In Personam Jurisdiction (the constitutionality of general in personam PJ)Idea of general PJ is that a state may have jurisdiction over a company/person even for COA not arising from their contact with that state if the contact is systematic and continuous (rare- only 3 S.Ct. cases on the topic). (Remember, still need a state long-arm to authorize this exercise of PJ. This section asks whether it is constitutional.)Perkins (1952): Court said general jurisdiction was appropriately exercised over a Philippine corporation sued in OH (COA does not arise out of or relate to the foreign corporation’s activities in OH, based upon things that occurred in the Philippines) because the company’s affairs were overseen in OH during WWII (president’s office, company files, all activity conducted there). A court may exercise in personam general PJ if D corporation’s in-state activities are conducted on a “continuous and systematic basis.”Helicopteros (1984): Helicopter owned by Colombian corporation crashed in Peru. Survivors of US citizens wanted to bring wrongful death suits in TX- held, no, not constitutional. D corporation’s helicopter purchases and purachase-linked activity in TX were insufficient (no systematic and continuous contact with TX) to subject it to TX court’s general jurisdiction. Mere purchases, even if occurring at regular intervals, are not enough to warrant a State’s assertion of general PJ over a nonresident corporation in a COA not related to those purchases.Goodyear Dunlop Tires Operations SA v. Brown (2011): Bus crash in France killed 2 boys, parents brought negligence suit in NC against Goodyear and its foreign subsidiaries (crash caused by negligently made tires). Held, no general PJ over the foreign subsidiaries- not consistent with DP clause of 14th amendment. D’s are not registered to do business in NC, have no employees or bank accounts there, do not manufacture or themselves sell or ship tires to NC. While a small percentage of their tires do go to NC, not the kind that caused the accident. In order to gain general PJ, a D must have continuous and systematic contacts with the forum- not here. More on Specific In Personam Jurisdiction (Minimum contacts + FPSJ in application)Idea: a court may exercise limited or specific jurisdiction over a D in an action when the controversy is related to or arises out of the D’s contacts with the forum.Note: timing- the minimum contacts with the forum state must exist when the COA arises.Minimum contacts: McGee v. International Life Insurance Co. (1957): “Single contact” jurisdictional rule: S.Ct. upheld CA’s exercise of PJ over an out-of-state insurance company in a suit by a CA resident to collect the proceeds of an insurance policy the company issued to a CA resident. The only contact between the company and the forum state was the mailing of premiums by the CA resident to the company in TX. However, the COA arose from this contact. Minimum contacts existed, and balancing the interests of P, D, and forum state, the exercising of jurisdiction is desirable. Hanson v. Denckla (1958): Trust settlor set up trust in DE, then moved to FL. S.Ct. held FL could not exercise PJ over the DE-based trust because the trust sought no business in FL, was forced to do business with FL because the settlor moved. Holding: While a single contact can be enough (McGee), the contact must be the result of purposeful availment, not unilateral acts of a third party. “The unilateral activity of those who claim some relationship with a nonresident D cannot satisfy the requirement of contact with the forum. It is essential that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits of the laws.” Fair play and substantial justice: Worldwide Volkswagon Corp. v. Woodson (1980): P bought car in NY then drove to AZ, had car crash in OK, brought suit in OK state court against car manufacturers and distributors (2 of the Ds operations were limited to tri-state area). OK’s long-arm statute coextensive with DP clause. OK S.Ct. said the exercise of PJ was constitutional because cars are mobile, so it was foreseeable that it might cause damage in other states. Held: No PJ over the 2 local distributors. Foreseeability of a car’s mobility alone is not a minimum contact. Foreseeability = “the D’s conduct and connection with the forum State are such that he should reasonably anticipate being haled into court there.” Here, D could not reasonably foresee being taken into OK court. Foreseeability + required (could be purposeful availment- D did not solicit business or sell products in OK) for minimum contacts. D had no contacts with OK. What is fair play and substantial justice? Test: Balance the burden on the D (to litigate in a distant/inconvenient forum) against 1) forum state’s interest in adjudicating the dispute, 2) P’s interest in convenient and effective relief, 3) interests of the interstate judicial system in obtaining the more efficient resolution of controversies, and 4) shared interest of the states in furthering fundamental substantive social policies. Minimum contacts serves two purposes: 1) concern for D’s inconvenience and 2) sovereignty/federalism concern that state courts should be checked from encroaching on the sovereignty of the other co-equal statesA consumer’s (foreseeable) unilateral act of bringing the D’s product into the forum state is not a sufficient constitutional basis for PJ over the D. D must purposefully avail itself of the privilege of doing business in that state in some way (sending goods to the state, soliciting business there).Dissent (Brennan): By placing into the stream of commerce a product that is inherently mobile, D should anticipate that it is being subject to court action wherever its products cause injury. Effects Test: (something you intentionally do outside the forum State has specific effects in that State can sometimes be a basis for specific PJ)Keeton v. Hustler Magazine (1984): P sues Hustler for libel in NH, Hustler’s only contact with NH is selling magazines there, but P’s claim is based on the content of those magazines. S.Ct. allowed NH to exercise PJ. (Also, P does not need to have minimum contacts with the forum state).Calder v. Jones (1984): Entertainer living in CA sues writer and editor of National Enquirer (FL domiciliaries) for libel in CA. S.Ct. said PJ allowed. Purposefully aimed conduct (writer and editor acted intentionally to produce an article for dissemination primarily in CA) can be basis for PJ- they could anticipate being brought into CA court. Kulko v. Superior Court (1978): NY ex-husband buying his daughter a plane ticket to CA not enough of a contact to give CA court PJ over him in child support suit. Minimum contacts required for individuals as well as corporations.Defintion of “effects test”: (Harris Rustky v. Bell Clements 9th Cir. 2003): The D has to have 1) committed an intentional act, 2) expressly aimed at the forum state, 3) causing harm, the brunt of which is suffered – and which the D knows is likely to be suffered – in the forum state.Burger King v. Rudzewicz (1985): MI-resident D breached franchise contract with Burger King, FL long-arm statute allowed PJ to extend to any person who breaches a contract in the State by failing to perform acts that the contract requires to be performed there. Was FL court’s exercise of PJ constitutional? Held- yes. D “purposefully directed” his activities at FL (reached out to Burger King to acquire franchise, all payments were sent there, all negotiations went through FL HQs), thereby giving him “fair warning” that he may be subjected to PJ there. A contract with a forum resident alone is insufficient to establish minimum contacts, but all subsequent activity surrounding the contract is. Minimum contacts + FPSJ: If FPSJ is highly satisfied, lesser minimum contacts will be allowed (PJ can still be asserted). However where a D who purposefully has directed his activities at forum residents (minimum contacts satisfied) seeks to defeat jurisdiction, he must present a compelling case that the presence of some other considerations would render jurisdiction unreasonable (if there are strong minimum contacts, must show some overwhelming reason why FPSJ are not met).FPSJ inquiry (minimum contacts of D satisfied because D knew it was entering a business relationship with a FL corporation): 5 factors of WW VolkswagenDissent (Stevens): Fundamentally unfair to force D to defend suit there, when he maintained no place of business or employees there, had never been to FL. No FPSJ. Disparities in bargaining power, lacked fair notice, boilerplate terms.Alchemie International v. Metal World (D.N.J. 1981): a single sale contract could be sufficient to support long-arm jurisdiction over a nonresident sellerWhat are minimum contacts? Asahi Metal Industry v. Superior Court (1987): Zurcher (CA resident) sues Cheng Shin (Taiwanese manufacturer of tube) for motorcycle crash, Cheng Shin impleads Asahi (Japanese corporation who made the tire valve assembly). P settles, only case remains between Cheng Shin and Asahi over indemnity term of contract made in Japan. Issue: Is this exercise of PJ constitutional (minimum contacts + FPSJ)- Does the mere awareness on the part of a foreign D that the component it manufactured, sold, and delivered outside the US would reach the forum state in the stream of commerce constitute minimum contacts with the forum state such that the exercise of jurisdiction does not offend traditional notions of FPSJ? Held- no PJ here (all agree, no FPSJ here)4 Justices (O’Connor): Minimum contacts = stream of commerce plus an action of the D purposefully directed toward the forum state (No minimum contacts here because D did not solicit business in CA, no office, agents, or advertising there, D did not control distribution system which brought its products to CA)4 Justices (Brennan): Minimum contacts = stream of Commerce plus an awareness/foreseeability that a product could end up in the forum State is enough to justice PJ (lesser than O’Connor). These 4 justices believe minimum contacts did exist in this case.1 Justice (Stevens): Stream of Commerce plus volume, value, hazardousness of product balancing (does D produce over 100,000 units annually?)FPSJ (all 9 justices): All justices agree that allowing PJ here would offend this requirement, since no CA parties exist anymore, case is no longer about safety, foreign relations concerns. Balancing of factors for FPSJ: burden on D, interests of the forum state (none here), P’s interest in obtaining relief, social policies, interstate judicial system’s interest in obtaining the most efficient resolution of controversies, and here, international policy concerns. J McIntyre Machinery v. Nicastro (2011): P injured in NJ using a machine manufactured by D, an English company, in England. Issue: Do NJ courts have PJ over D, notwithstanding the fact that the company neither marketed goods in the State nor shipped them there? Holding: No. (even more limited PJ over foreign corporations than Asahi)Place of incorporation and principal place of business are two good places to sue a corporation (explicit statement for the first time about PJ, had always been the understanding of location for SMJ).Plurality (4 justices, but 6 votes concurring in result of no PJ): Like O’Connor in Asahi, but stricter. In a products liability case, it is the D’s purposeful availment (Hansen) that makes jurisdiction consistent with the “traditional notions of fair play and substantial justice”. The purposeful availment must be at a particular state, not the US in general. Rejection of Brennan’s concurrence in Asahi. Focus on purposeful availment. D has no contacts with NJ other than its product ending up there through an independent distributor. Concurring in judgment (2 justices): No specific effort by D to sell in NJ (so agree with plurality). But disagree with plurality because it suggests that jurisdiction is limited where D does not intend to submit to the power of a sovereign. Dissent: Foreign corporations who do not want to be sued for products liability can now avoid it by just having distributors. D could easily defend suit in NJ, but P cannot easily sue in England. Long Arms in Federal CourtThe Constitutional authorization for federal courts to exercise personal jurisdiction is the 5th amendment DP clause. Here, “minimum contacts” must exist with the US as a whole, not with a particular state within the US (Stafford v. Briggs 1980- Stevens dissent) in order for the exercise of PJ to be constitutional. There is a split of authority as to whether “fairness” factors should also be considered in the PJ inquiry for federal courts. The majority view is to just consider minimum contacts, the minority view (discussed in Oxford First Corp. EDPA 1974) says fairness is a further check on PJ in federal courts.FRCP 4(k): How much of the Constitutional power is exercised? FRCP 4(k)(1)(A): Serving a summons or filing a waiver of service establishes personal jurisdiction over a defendant who is subject to the jurisdiction of a court of general jurisdiction in the state where the district is located. (Piggyback- pretend you are a state court, use state long-arm and state constitutionality DP inquiry). FRCP 4(k)(1)(B): Serving a summons or filing a waiver of service establishes personal jurisdiction over a defendant who is a party joined under Rule 14 (third party practice) or 19 (compulsory joinder of parties) and is served within a judicial district of the US and not more than 100 miles from where the summons was issued. (Bulge Rule- you can assert PJ over a party joined under Rule 14 or 19 by serving them within 100 miles of the court seeking to assert jurisdiction)FRCP 4(k)(1)(C): Serving a summons or filing a waiver of service establishes personal jurisdiction over a defendant when authorized by a federal statute. (Congress by statute can authorize nationwide SOP i.e. nationwide PJ). FRCP 4(k)(2): For a claim that arises under federal law (FQ), serving a summons or filing a waiver of service establishes PJ over a defendant if the defendant is not subject to jurisdiction in any state’s courts of general jurisdiction and exercising jurisdiction is consistent with the US Constitution and laws.Response to Omni Capital Int’l v. Rudolf Wolff (1987) where foreign Ds doing business in the US could not be sued for violating federal laws (silent on SOP) because the state long-arm did not reach them- see long outline for fairness inquiry if 4(k)(2) used. Personal Jurisdiction in the Internet AgeS.Ct. has not ruled on where PJ is allowed based on Internet contacts. Circuits seem hesitant to allow people who run a website to be subject to PJ everywhere.ALS Scan v. Digital Service Consultants (4th Cir. 2002): Whether a GA-based ISP can be subjected to PJ in MD because it enabled a website owner to publish photographs on the Internet, in violation of a MD corporation’s copyrights? No. Test: A State may, consistent with DP, exercise judicial power over a person outside the State when that person (1) directs electronic activity into the State, (2) with the manifested intent of engaging in business or other interactions within the State, and (3) that activity creates, in a person within the State, a potential cause of action cognizable in the State’s courts. Court takes Zippo sliding scale test and molds it with Calder effects test. In Rem and Quasi in Rem Personal JurisdictionIn Rem: action against the property itself (about ownership of the property) Quasi in rem (action against the person through the property- premises liability). Shaffer v. Heitner (1977): Facts: P brings a shareholders derivatives suit in DE state court against D corporation and against the officers and directors of the corporation. None of the officers/directors live in DE; P attaches their stocks as property “in DE” to the action (so asserting quasi in rem jurisdiction over the officers). Held- no, cannot use QIR PJ like this, because the officers do not have minimum contacts with the forum state. In order to assert QIR or in rem personal jurisdiction, the D still must have minimum contacts and there still must be FPSJ with the forum state. For in rem, this is clearly satisfied since the action is against and regarding the property itself (i.e. claims to quiet title). For QIR personal jurisdiction where the property serves as merely the means of satisfying the judgment and jurisdiction is completely unrelated to the P’s COA, P must show that D has some other minimum contact with forum state to justify PJ. Here, the sole basis for DE’s jurisdiction is the statutory presence of D’s stock in the state. The stock is totally unrelated to the COA. Since P has failed to allege any of the types of contacts required by constitutional minimum contacts standards, DE cannot exercise jurisdiction over the case. All assertions of state-court personal jurisdiction must be evaluated according to the standards set forth by International Shoe and its progeny. So where is QIR still useful (seems to have merged with in personam)? QIR could still be used if the state long arm does not authorize in personam PJ (enumerated statute), but an exercise of PJ would still be constitutional under the DP clause and the D has property in the state.Traditional Bases Revisited Physical Presence and “Tag” JurisdictionBurnham v. Superior Court (1990): Wife served divorce papers on husband while he was visiting his children in CA (husband has no ties in CA, lives in NJ). Tag jurisdiction reaffirmed as a traditional basis- CA may assert jurisdiction over a party properly served while in the state. [Shaffer claim that all assertions of PJ must comport with minimum contacts +FPSJ doesn’t apply here?]Plurality (4 justices: Transient tag jurisdiction (presence in state while served) comports with traditional notions of fair play and substantial justice simply because it has been consistently upheld since 19th century.Concurrence (4 justices): transient jurisdiction passes fairness test because it satisfies both the minimum contacts and reasonableness subsets (3 days of benefits of CA’s police, economy, etc.). Tradition is relevant, not dispositive. Concurrence (1 Justice- Stevens): I disagreed with Shaffer. Consent: Ways a Defendant can be held to have Consented1) Failure to raise an objection to consent in first pleading or first FRCP 12 motion: FRCP 12(h)(1) (a party waives by failing to raise)2) Consent by sanction- punishment for failing to comply with discovery where P is attempting to establish jurisdiction can be an order finding PJ: Insurance Corp. of Ireland v. Compagnie (1982). PJ flows from DP clause- personal rights can be waived.3) Consent by statute requiring a corporation to appoint an agent- courts split as to whether this is constitutional, depends on the situation4) Consent in advance of litigation: M/S Bremen v. Zapata (1972): damages to rig that was being towed, contract said all disputes regarding the contract would be litigated in Ireland. Forum-selection clauses are “prima facie valid” and should be enforced unless enforcement is shown by the resisting party to be “unreasonable” under the circumstances. See also Carnival Cruise Lines v. Shute (1991): S.Ct. upheld forum clause in form contract between the parties for a cruise (P injured on boat, brought suit against D in WA, but the contract said P could only sue in FL- affirmed contract).Preliminaries 3: Removal, Venue, Transfer of Venue, and Forum Non ConveniensRemovalRemoval is the right of the defendant (cannot be a plaintiff after D has asserted a counterclaim- see Shamrock Oil v. Sheets 1941) to remove a case from state to federal (one-way street, does not flow the other way) if it could have originally been brought in federal court. D cannot remove if it’s a diversity suit and he’s a citizen of the state where case was originally brought.The St. Paul Mercury Rule: the party seeking to invoke the federal forum (in removal, the Ds) has the burden of showing that there is SMJ. Recall, the sum plead by the P as the AIC controls unless it appears to a legal certainty that the amount is not true.General rule: All defendants must join in the petition for removal. (see Chicago, Rock Island & Pacific Railway v. Martin 1900- S.Ct. construction of §1441(a)). Exception: not true when Ds have separate and independent claims against them. Case then can be split and only part of it removed. Note: nominal parties do not count as objectors and cannot object to removal (recall Pete Rose and MLB case). 28 USC § 1441 General Removal Statute: A) Any civil action brought in a state court of which the district courts of the US have original jurisdiction may be removed by the Ds to the district court of the US for that same state. (you remove to the district court covering that state court) B) Any civil action of which the DCs have original jurisdiction founding on a claim or right arising under Constitution or federal laws (FQ) shall be removable without regard to citizenship of the parties. Any other action shall be removable only if none of the Ds is a citizen of the State in which such action is brought. C) Whenever a separate and independent claim or COA within the jurisdiction conferred by section 1331 (FQ) is joined with one or more non-removable claims or COAs, the entire case may be removed and the DC may determine all issues, or, in its discretion, may remand all matters in which State law dominates. F) The court to which a civil action is removed under this section is not precluded from hearing and determining any claim in such civil action because the State court from which such civil action is removed did not have jurisdiction over that claim. 28 USC § 1446 (Procedure for removal): A) D seeking removal shall file in the DC of the US for the district within which such action is pending (i.e. the DC in the same area/state as the state court where the suit is originally filed) a notice of removal signed pursuant to FRCP Rule 11 and containing a short and plain statement of the grounds for removal. B) D has 30 days from receipt of the original complaint (SOP) to file the notice for removal, or within 30 days after the service of summons upon the D if the pleading is not required to be served on the D, whichever is shorter or within 30 days after case becomes removable. D) Promptly after filing notice of removal, the Ds shall given written notice to all other parties (i.e. the P) and shall file a copy of the notice with the clerk of the State court. Then the State court shall not proceed unless or until the DC decides to remand. Timing- 30 days after receiving SOP or when the case becomes removable to remove. But if it is a diversity action and the case becomes removable a year + after its commencement (i.e. a party or claim drops out so now there’s diversity), case cannot be removed. 28 USC § 1447 (Procedure after removal generally): A) DC may issue all necessary orders to bring in proper parties. B) It may require the removing party to file with its clerk copies of all records and proceedings from the State court or may cause the files to be brought before it by writ of certiorari issued to the State court. C) Challenge to removal (30 days to challenge)- If a case is removed erroneously, a DC must remand it (30 days to do so, otherwise it states in State court, unless the removal is based on the lack of SMJ, then it can be remanded at any time). D) An order remanding a case to State court is not reviewable on appeal (unless section 1443, civil rights cases). E) If after removal the P seeks to join additional Ds which would destroy SMJ (like destroy diversity), then the court may deny joinder, or permit joinder and remand to State court. Venue and Transfer of Venue1. VenuePurely statutory- which courts within a state and within a system can hear the case?Three traditional types of venue (§1391): 1) Defendant residence, 2) substantial part of the claim, 3) fall back28 USC § 1391 (Federal Venue generally): For diversity cases: A) Venue is appropriate only in (1) a district court where any D resides, if all Ds reside in the same State, (2) a district court in which a substantial part of the events giving rise to the claim occurred, or a substantial part of the property that is the subject of the action is situated, or (3) a district court in which any D is subject to PJ at the time the action is commenced, if there is no other district court in which the action may otherwise be brought. For FQ cases: B) Venue is appropriate only in (1) a district court where any D resides, if all Ds reside in the same State, (2) a district court in which a substantial part of the events giving rise to the claim occurred, or a substantial part of the property that is the subject of the action is situated, or (3) a district court in which any D may be found, if there is no district in which the action may otherwise be brought. Corporations and venue: C) For the purposes of venue, a D corporation is deemed to reside in any district court in which it is subject to PJ at the time the action is commenced. In a state with multiple districts, the corporation is deemed to reside in any of the districts where its contacts would be sufficient enough to subject it to PJ if the district was a separate state and if there is no such district, the corporation shall be deemed to reside in the district within which it has the most significant contacts. Aliens: An alien may be sued in any district. Where an individual resides for venue purposes is the same inquiry as where their domiciliary is for SMJ purposes- where you are born, subject to moving with an intent to stay. But an association’s residence is determined by the actual residence of the association, not the residence of all its members, like for diversity SMJ- Denver & RGWR 1967. Venue can be challenged by FRCP 12(b)(3) motion. Like PJ, if not challenged, it is waived. (venue is another protection on D, but D can waive it)There are other venue statutes, for specific types of COAs. Ex: 28 USC §1400 B) Patent infringement cases may be brought in the judicial district where the D resides or where the D has committed acts of infringement and has a regular and established place of business.Contractual consent to venue usually enforceable. If the case is about land, it should be brought in the district where the land is located (general understanding). Substantial part of the claim Bates v. C&S Adjusters, Inc. (2nd Cir. 1992): P received a collection notice from D in NY and filed suit against D in NY for violations of the Fair Debt Collection Practices Act (FDCPA). P incurred the debt while living in PA, which is where the D resides. D mailed the collection notice to P at his PA address and the notice was forwarded to NY. Venue was held to be appropriate in NY because a substantial part of the harm occurred in NY, when P received the notice. Note: §1391 only applies to cases that are commenced in federal court. The proper venue for a case removed to federal court is the federal court covering the state court from which it was removed (§1441(a)). If venue was proper in the state court under the state’s venue laws, it is proper once removed. Transfer of Venue28 USC § 1404 A: For the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought. (This is the transfer statute for when venue was proper in the original court- PJ may or may not have been proper). Hoffman v. Blaski (1960): Interpretation of §1404- “where it might have been brought” means where the P may have been able to bring the case originally. D cannot use transfer of venue to transfer the case to a court where the P could not have brought it. (Facts: P, resident of IL, brought suit against D, TX corporation, in NDTX for patent infringement- venue determined by §1400b. D sought to transfer to NDIL under 1404. S.Ct. held no- P could not have brought the case in NDIL, so D cannot transfer it there. Venue is not meant to enlarge the D’s right or give him options not available to the P.)28 USC § 1406 (Cure or waiver of defects): A) If venue or PJ was not proper in the original court, that court may dismiss or if it is in the interest of justice, transfer the case to any district in which it could have been brought. B) If a party does not object to venue in a timely manner, it is waived. Goldlawr v. Heiman (1962): A court can use 1406(a) to transfer a case from a court that does not have PJ to a court which does have PJ and is a proper venue. 28 USC § 1631 Transfer to cure want of jurisdiction: If a civil action is filed in a court and the court finds that it does not have jurisdiction, the court may transfer the action to any other court which the action could have been brought at the time it was filed or noticed, if it is in the interest of justice, and then the case proceeds as if it had always been brought there (so for SOL purposes, case began when it was filed at the first court lacking jurisdiction).Choice of Law and Transfer of VenueIf transfer is made under §1404 where venue and PJ were proper in the original court, use the law, including choice of law rules, of the transferor court. (Van Dunsen v. Barrack 1964). This rule applies even if it is the P who initiates transfer. (Ferens v. John Deere 1990). (can lead to gamesmanship)If transfer is made under §1404 but there was no PJ in the original court (so venue was proper, but no PJ), use law, including choice of law, of transferee court. If transfer is made under § 1406 (no venue and/or no PJ), use the transferee’s laws/choice of laws. Federal law transfer: Use law of transferee court, but the law of transferor court is VERY persuasive. Transfer StatutePJ in Transferor?Venue in Transferor?Follow law of§1404YYTransferor§1404NYTransferee§1406YNTransferee Forum Non ConveniensCommon law doctrine, allows a court to dismiss, even when there is PJ, SMJ, and venue. Idea is that a court retains the power to refuse to hear the case if it believes that in the interests of justice, there is a better forum. Gulf Oil v. Gilbert (1947): S.Ct. recognized the principle of FNC in this case. Two steps: 1) determine if there is another open forum. 2) If so, balance these factors: private interest of the litigant, relative ease of access to sources of proof (evidence), enforceability of a judgment if one is obtained, cost of attendance for witnesses, public interest (local interest in having localized controversies decided at home, but not in imposing jury duty on a community with no relation to the litigation). Forum choice of a P should only be disrupted when the private interest (affecting the convenience of the litigants) and the public interest (affecting the convenience of the forum) clearly point toward trial in an alternative forum.Example- applying the Gulf Oil factors test: Piper Aircraft Co. v. Reyno (1981): Wrongful death action from stemming from airplane crash in Scotland was brought in CA state court against PA plane manufacturer and OH propeller manufacturer. Action was removed by Ds to federal district court then transferred to PA. Then Ds moved to dismiss on forum non conveniens ground (suit should be brought in Scotland, where Ds had already consented to jurisdiction and part of the suit was already going on). District Court granted the dismissal- S.Ct. affirmed. Held- (1) Ps may not defeat a motion to dismiss on FNC merely by showing that the substantive law that would be applied in the alternative forum would be less favorable (with safety valve of, if foreign law would essentially provide no remedy, then it can be considered), (2) district court properly decided that the presumption in favor of the P’s forum choice applied with less than maximum force when the P is foreign, (3) district court was reasonable in concluding that most evidence was in Scotland, and (4) district court properly determined that public interest factors favored trial in Scotland. US citizens are usually given more deference in their forum choices than foreign Ps.FNC dismissal is usually conditioned on the D consenting to PJ/venue in some other forum. Usually there must be anther more convenient forum. But see Islamic Republic of Iran v. Pahlavi (NY 1984): where NY S.Ct. upheld NY state courts dismissal on FNC where Iran tried to sue its former rule in NY to recover misappropriated funds, even though there was no alternative forum, since the ruler did not intend to return to Iran. NY said it was not required to entertain litigation that had no connection with the state. Sinochem International v. Malaysia International Shipping (2007): a district court does not need to first determine if it has PJ over the parties before it can dismiss the action on FNC grounds. Would have required lengthy discovery to determine if the court had PJ, but court could immediately dismiss on FNC grounds. Pleading Special Matters, The Motion to Dismiss for Failure to State a Claim, and other FRCP 12(b) MotionsPleading Special MattersFRCP 8 says what a pleading must contain. To challenge the sufficiency of the plaintiff’s pleading, a party files a FRCP 12(b)(6) motion for failure to state a claim. The challenge can be legal (the law does not recognize a right to recover here) or factual (how much factual detail to you need to provide in order to convince judge that you are able to prevail)FRCP 9 Pleading Special Matters: B) When alleging fraud or mistake, the party must state with particularity the circumstances constituting fraud or mistake. G) If a party seeks special damages (unforeseeable damages), it must specifically state so. Judges cannot heighten pleading standards. Pleading standards are set in the FRCP or by statute: Leatherman v. Tarrant County (1993): Pleading requirements are heightened through amending the FRCPs, not by judicial interpretation. In the absence of such an amendment, federal courts and litigants must rely on SJ to weed out unmeritorious claims, not 12(b).Baustica v. Los Angeles County (9th Cir. 2000): It is ok for pleadings to be stated at a high level of generality. Each P in a multi-P action does not have to separately state each element of his or her claim.Swietkiewicz v. Sorema (2002): Employment discrimination case. The prima facie case is an evidentiary standard, not a pleading standard. P not required to make out every element of case in the pleading. Employment discrimination not a special matter under FRCP 9. Original Interpretation of FRCP 9(b): Pleading FraudDenny v. Carey (EDPA 1976): The requirement of 9(b) is met when there is sufficient identification of the circumstances constituting fraud so that D can provide an answer. But 9(b) does not require the P to meet such a rigorous burden of stating facts in pleading fraud, because a lot of the facts are peculiarly within only D’s knowledge. Private Securities Litigation Reform Act (PSLRA) of 1995 heightened the pleading standard for fraud in securities cases. Complaint must specify exactly what statements were misleading and why, facts giving rise to “strong inferences” of scienter must be stated with particularity. Tellabs Inc. v. Makor Issues & Rights (2007): In order to qualify as a strong inference of scienter, the inference must be cogent and at least as compelling as any opposing inference of nonfraudulent intent (more than just reasonable). In deciding a 12(b)(6) motion in a fraud complaint, courts must 1) accept all factual allegations as true, 2) consider complaint in its entirety and inquire as to whether all facts give rise to a strong inference of scienter, 3) take into account plausible opposing inferencesResponding by FRCP 12 – Motion to DismissThe 12(b)(6) Motion: Pre-2007 Conley FRCP 8: A pleading that states a claim for relief must contain…2) a short and plain statement of the claim showing that the pleader is entitled to relief.FRCP 12(b)(6): Every defense to a claim for relief in any pleading must be asserted in the responsive pleading if one is required. But a party may assert the following defenses by motion…6) failure to state a claim upon which relief may be granted.Under the Code system, the complaint needed to allege a lot in order to survive a motion to dimiss- needed to include facts sufficient to constitute a cause of action. The pleading system of the FRCP was designed to move us away from this, to notice pleading- emblemized by Dioguardi, with language captured in Conley. FRCP 8 is very general; pleading standards can be heightened by Rule 9 or by statute for specific types of cases. Dioguardi v. Durning (2nd Cir. 1944): very loose understanding of what a plaintiff must plead in order to survive a 12(b)(6). Conley v. Gibson (1957): sites Dioguardi, says that a complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that P can prove no set of facts in support if his claim which would entitle him to relief. Rule 8 does not require a claimant to set out in detail the facts upon which he bases his claimApplying Conley: American Nurses Association v. Illinois (7th Cir. 1986): class action charging IL with sex discrimination in employment. Held- a complaint cannot be dismissed merely because it includes invalid claims (comparable worth case) along with a valid one. While the complaint makes a series of allegations that do not constitute a valid claim, it could also be alleging intentional discrimination, so that does state a claim. Note: Shaw v. Merrit-Chapman (6th Cir. 1977): A 12(b)(6) motion constitutes an adjudication on the merits, so further actions on the same claim are barred (absent specific language to the contrary). The 12(b)(6) Motion: Developments 2007-Present (i.e. the pleadings earthquake)Bell Atlantic Corp. v. Twombly (2007): Antitrust class action against major telephone companies for violating Sherman Act by inhibiting growth of local phone companies. S.Ct. upheld district court’s grant of D’s 12(b)(6) motion. Held- Rejects the “no set of facts” standard of Conley (at least for antitrust- extended to all cases in Iqbal) as incomplete. In evaluating a 12(b)(6) motion, court assumes all facts of the pleading are true, but not all conclusions. In order to state a claim under the Sherman Act, a P must plead enough factual matter to suggest that an agreement was made- plausible grounds to infer an agreement, not just conceivable. “Because the Ps here have not nudged their claim across the line from conceivable to plausible, their complaint must be dismissed. Dissent: Conley should not be overruled so quickly, the majority as collapsed SJ and 12(b)(6), this rule protects antitrust Ds (rich). Ashcroft v. Iqbal (2009): discrimination case filed by Pakistani Muslim against US Attorney General and Director of FBI for being detained following 9/11. Held- insufficient pleading. Complaint does not contain any factual allegation sufficient to plausibly suggest D’s discriminatory state of mind. Establishes a “two-pronged approach” to deciding 12(b)(6)s: 1) accept all factual allegations in the complaint as true, but do not have to accept legal conclusions couched as factual allegations as true; 2) only a complaint that states a plausible claim for relief (not just merely possible) survives a motion to dismiss. A complaint must contain sufficient factual matter that if accepted as true, states a claim to relief that is plausible on its face. A claim has facial plausibility when the P pleads factual content that allows the court to draw the reasonable inference that the D is liable for the misconduct alleged. Other, 12(b)(6) will be granted. Other Motions Attacking PleadingsSee FRCP 12(c)-(i)FRCP 12(c) is a 12(b)(6) motion after pleadings are closed (after Answer and Reply- judgment on the pleadings). D) If on a 12(b)(6) or 12(c) motion, matters outside the pleadings are considered, it is treated as a motion for summary judgment Rule 59. FRCP 12(e) is a motion for a more definite statement. FRCP 12(f) is a motion to strike immaterial scandalous material- rarely granted. [To strike as scandalous, it must be obviously false and unrelated to the subject matter of the action. Gateway Bottling v. Dad’s Rootbeer WDPA 1971. “Immaterial” means statements and averments bearing no essential or important relationship to the claim or defenses. Cobell v. Norton DC Cir 2004]Consolidation and Joinder of FRCP 12 Motions FRCP 12(g): 1) All Rule 12 motions can be joined. 2) With exceptions in 12(h), a party that makes a Rule 12 motion must not make another motion under this rule raising a defense or objection that was available to the party but omitted from its earlier motion. (so generally, you only get one Rule 12 motion)3 FRCP 12(h): If they are never raised, they are waived (except 12(b)(6)&(7) which may be raised in any pleading or by motion, or at trial 12(h)(2) and SMJ can always be challenged 12(h)(3)). Note- could file an amendment under Rule 15(a)(1)Expanding the Lawsuit: Joinder of Claims and Parties, and AmendmentsTheme: litigant autonomy v. efficiency/justiceClaim Joinder – FRCP 18 (all permissive)(1P,1D: anything to anything- but check for supp juris)FRCP 18 (permissive claim joinder): A party may join as many claims as it has against an opposing party. (works for claims, counterclaims, crossclaims, or third party claims- if you have one good (___)claim, can add as many claims as you want against that same party) But note, this does not mean the court will have SMJ over the joined claims. If the claim does not independently have federal SMJ, look to §1367 to see if there is supplemental jurisdiction (common nucleus of operative fact). As a matter of the FRCP, all claims joinder is permissive. But see claim preclusion (you don’t have to bring it, but you may be stopped from bringing it later)FRCP 42 Consolidation, Separate Trials- if actions before the court involve a common question of law or fact, the court may consolidate the cases for some parts of the proceedings for efficiency purposes (like discovery or even trial). For convenience, to avoid prejudice, and for economy, the court may order a separate trial for one or all of the separate claims, crossclaims, counterclaims, or third-party claims. Party JoinderPermissive (as plaintiffs or defendants) – FRCP 20 T&O+CQFRCP 20: A) Persons may join as plaintiffs if they assert any right to relief jointly, severally, or in the alternative with respect to or arising out of the same transaction/occurrence any question of law or fact common to all Ps will arise in the action. B) Persons may be joined (by the P) in one action as defendants if any right to relief is asserted against them jointly, severally, or in the alternative with respect to or arising out of the same transaction/occurrence and any question of law or fact common to all Ds will arise in the action.Test: if the claim/right stems from the same transaction or occurrence AND there is a common question of law or fact, the party can be joined = T&O+CQBroad construction of same T&O: Poster v. Central Gulf Steamship (EDPA 1960): shrimper allowed to sue operators of two different boats in same action for his illness, saying illness was a result of both exposures. (See compulsory counterclaims, infra, for 4 tests of same T&O)See FRCP 21 Misjoinder- court can unjoin parties (add or drop a party) on motion or on its own. The court may also sever any claim against a party. Compulsory FRCP 19 Required Joinder of Parties. Not to be tested. Counterclaims (Compulsory v. Permissive)Compulsory – FRCP 13(a): Same T&O = compulsory“A pleading must state as a counterclaim any claim that at the time of its service the pleader has against an opposing party if the claim arises out of the transaction or occurrence that is the subject matter of the opposing party’s claim and does not require adding another party over whom the court cannot acquire jurisdiction.”FRCP 13 governs counterclaims by people already part of the litigation. Three exceptions where assertion of a compulsory counterclaim is not compulsory: 1) the claim in question is already being litigated, 2) to assert the counterclaim, you’d have to add a party who the court doesn’t have jurisdiction over, 3) the basis for PJ is in rem/QIR but there is not in personam jurisdiction over the D. Consequence of failing to raise a compulsory counterclaim (or even a permissive counterclaim)- res judiciata, infra (cannot bring in federal court, maybe state)What is same T&O? A series of occurrences linked by a logical connection. 4 tests for if a claim and counterclaim are same T&O: are the issues of fact and law raised by the claim and counterclaim largely the same? Would res judicata (claim preclusion) bar a subsequent suit on D’s claim absent the compulsory counterclaim rule? Will substantially the same evidence support or refute the P’s claim as well as the D’s counterclaim? Is there any logical relation between the claim and counterclaim? Broad construction, may involve a series of many occurrences that are logically connected. Moore v. New York Cotton Exchange (1926)United States v. Heward Robinson Co. (2nd Cir. 1970): dispute over two separate contracts between two parties (P sued on the Navy plant contract, federal SMJ, D counterclaimed on the state contract). Court held the two disputes were same T&O, so the counterclaim was compulsory (13(a)), so federal court could exercise supplemental jurisdiction (CNOF) over the counterclaim. Counterclaim arose out of the same “transaction & occurrence”, as that is broadly construed. Concurrence (Friendly): these two contracts are not same T&O, but court should still have supplemental jurisdiction. Permissive – FRCP 13(b)“A pleading may state as a counterclaim against an opposing party any claim that is not compulsory.”FRCP 13(h)- you can add parties for a counterclaim or crossclaim- governed by rules 19 and 20Cross-Claims – FRCP 13(g) – Same T&O = allowed (all permissive)FRCP 13(g): “A pleading may state as a crossclaim any claim by one party against a coparty if the claim arises out of the same T&O that is the subject matter of the original action or of a counterclaim, or if the claim relates to any property that is the subject matter of the action.Who is a “coparty”? All plaintiffs (if you are a P/3rd party P) or all defendants (if you are a D/3rd party defendant). See Earle M. Jorgenson Co. v. TI US (EDPA 1991).Need to check for SMJ still- supplemental jurisdiction will be helpful for crossclaimsFRCP 13(g)- A crossclaim is a claim by a P against a co-P, or by D against a co-D. These claims are against people already in the litigation. (if you want to add someone, need to use party joinder Rule 19 or 20). FRCP 13(h): Rules 19 and 20 govern the addition of a person as a party to a counterclaim or crossclaim. FRCP 13(i): If the court orders separate trials under Rule 42(b), it may enter judgment on a counterclaim or crossclaim under Rule 54(b) when it has jurisdiction to do so, even if the opposing party’s claims have been dismissed or otherwise resolved. Third Party Claims (aka “impleader”) – FRCP 14 (insurance/indemnification)FRCP 14: A defending party may, as third-party plaintiff, serve a summons and complaint on a nonparty who is or may be liable to it for all or part of the claim against it (i.e. if I lose, you have to pay- insurance). This party is called the third-party defendant. The third-party defendant may then assert any defense under Rule 12 and may assert any counterclaims against the third-party plaintiff under Rule 13 or another third-party defendant. The original plaintiff may assert claims against a third-party D. PJ & SMJ required over third party D (can use 4(k)(1)(B) bulge rule to get PJ), but no concern for venue.How the 3rd party D can avoid paying (besides just the original D winning): 14(a)(2)(C): The third party defendant may assert against the P any defense that the third party plaintiff has to the plaintiff’s claim. 14(a)(2)(A): The third party defendant must assert any defense against the third party P’s claim under Rule 12. 14(a)(2)(A)-(D) covers third party defendant’s claims and defenses. Basically, a third party D may/must bring her own counterclaims (permissive/compulsory) against the third party P (14(a)(2)(B)), may bring cross-claims against other third party Ds (14(a)(2)(B)), and can even implead her own third party D (14(a)(5)). She may also assert claims against the P that are T&O related (14(a)(2)(D)). 14(a)(3) Plaintiff’s claims against a third-party defendant Timing- 14(a)(1) original D can implead third party D within 14 days after filing its original answer and with court’s permission afterward (basically, it’s up to discretion of the court always)Intervention (permissive and as of right) – FRCP 24 (not on test) (I want to join!)Interpleader (statutory and rule) – not on test (complex, multi-party litigation with several people fighting over ownership)Reviewing Supplemental Jurisdiction and Joinder – see hypos, Exxon, §1367Amending the Pleadings and Relation Back of AmendmentsFRCP 15: a) 1) A party may amend its pleadings once as a matter of course within 21 days after serving it or within 21 days after receiving a responsive pleading or motion. 2) In all other cases, a party may amend its pleadings only with the opposing party’s written consent or the court’s leave. The court should freely give leave when justice so requires. (Court is very likely to allow the amendment). 3) 14 days to respond to an amended pleading b) Amendments during and after trial- (ex: party wanting to introduce a new cause of action not in the pleadings) If you don’t object, impliedly consent (15(b)(2)). IF you do object, 15(b)(1) court decides whether or not to allow amendment- court less likely to allow amendments during and after trial.c) When an amendment relates back- 1) An amendment to a pleading relates back to the date of the original pleading when A) the law that provides the applicable statute of limitations allows relation back, B) the amendment asserts a claim or defense that arose out of the conduct, transaction, or occurrence set out in the original pleading (when T&O related- just adding a claim or a defense, no new parties), or C) the amendment changes the party or the naming of the party against whom a claim is asserted if Rule 15(c)(1)(B) is satisfied (same T&O) and if within the period provided by Rule 4(m) for serving the summons and complaint (120 days), the party to be brought in by amendment (i) received such notice that it will not be prejudiced in defending on the merits and (ii) knew or should have known that the action would have been brought against it, but for a mistake concerning the proper party’s identity.Applying 15(c)(1)(C) (relating back when changing a party name): Singletary v. Penn Dept’ of Corrections (3rd Cir. 2001): Mother of prisoner who commits suicide brought suit against prison, state department of corrections, and “unknown corrections officer.” She later learns the name of the corrections officer (psychologist) and wants to use 15(c)(1)(C) to relate back (SOL had run). Issue: Within the timeframe of Rule 4(m) (120 days), did the unknown corrections officer receive notice that the action was pending (i) and have reason to know that he was that unknown party (ii)? Held- no. Shared attorney wasn’t shared until after the 120 day period, and the psychologist’s interests were not so tied with the prison that he would have known of the action (i) and known that “but for mistake”, he would have been the named party (ii). Suggested approach to amendments:1) If doing something mid-way through litigation, look for amendments (both leave to amend and possibility of relation back, and if relation back, look to whether adding claim (15(c)(1)(B)) or adding a party (15(c)(1)(C)- harder to do, party must have had notice)2) consider whether the joinder itself is authorized by the FRCP- 18, 19, 20, (13- counterclaims/crossclaims for the added parties), 143) If adding a claim or a party, look for SMJ (supplemental jurisdiction maybe)4) if adding a party, look for PJ (but remember, FRCP 4(k) bulge rule may be helpful if party added under Rule 14 (impleader) or 19 (compulsory party joinder) What Law to Apply? Erie (Vertical Choice of Law) and Horizontal Choice of LawTheoretical Background on Legal Formalism and RealismWhen a federal court is hearing a diversity case (state law claim), whose law should they apply (federal or state)? The answer lies in interpreting the Rules Decision Act of 1789. Summary of vertical choice of law: Erie says there is no federal common law. A federal court sitting in diversity must apply state substantive law, but federal procedural law. Rules Decision Act 1789 (28 USC §1652): “The laws of the several states, except where the Constitution or treaties of the United States or Acts of Congress otherwise require or provide, shall be regarded as rules of decision in civil actions in the courts of the United States, in cases where they apply.” What law to apply while sitting in diversity jurisdiction (aka “The Erie problem”)Swift and the Erie QuartetSwift v. Tyson (1842): Original interpretation- “laws of the several states” does not include state common law, only statutes. Why? Decisions of court are at must evidence of law, often reexamined and reversed. When a federal court is sitting in diversity, it is only obligated to follow the state’s statutory law. Federal courts in matters of general jurisprudence are free to exercise an independent judgment as to what the state law is or should be (federal general common law). Result of Swift = extreme gamesmanship. See Black &White Taxicab v. Brown & Yellow Taxicab (1928) where a P reincorporated in a different state in order to sue the D in federal court and make use of the more favorable federal common law Erie v. Tompkins (1938): Overrules Swift. Except in matters governed by the Constitution or Acts of Congress, the law to be applied in any case is the law of the state. There is no federal general common law. Congress has no power to declare substantive rules of common law applicable in a state and no clause in the Constitution gives such power to the federal courts. Why? Swift rests upon the assumption that there is a transcendental body of law outside of any particular state but obligatory within it. But law does not exist without authority behind it. The common law when enforced within a state must be the law of that State; the authority and only authority is the State (in diversity cases), and the voice adopted by the State as its own, either through its Legislature or its Supreme Court, should speak for it. Swift was an unconstitutional assumption of power by the federal courts. Note: when a matter is governed by a specific federal statute or when a FQ is involved, federal law will still apply in diversity cases.Dissent (Butler): constitutional avoidance, Court should not so quickly overrule SwiftConcurrence (Reed): The line between procedural and substantive law is hazy, but no one doubts the federal power over procedure, stemming from Art III of the Constitution (Congress sets up the judiciary) and the “necessary and proper” clause Art 1, Sec 8. Issue: Federal courts may apply their own rules of procedure, but any issue of substantive law (other than a FQ) must be determined according to the laws of the state in which the federal court is located (pretend you’re a state court, what would the state court do?). Is a particular issue substantive or procedural? Guaranty Trust v. York (1945): Outcome determinative test for substantive v. procedural: A federal court adjudicating a State-created right solely because of diversity is for that purpose just another court of the State, so it cannot afford recovery if the right to recover is unavailable in the State courts nor can it substantially affect the enforcement of the right as given by the State. (The outcome in a federal court should not be different from the outcome in state court. Here, SOL had run, but federal principle of laches would allow suit.) A rule of law is substantive within the Erie mandate if it “has a substantial effect upon the eventual outcome of the case.” Here, the statute of limitations has a substantially outcome on the case (i.e. P is barred from recovery), so use state law. (Note- SOL laws are outcome determinative, so use state laws for them) Dissent: Sticking to line between substantive and procedural. The Triple Play Cases- strong displacement of FRCP in favor of state lawRagan v. Merchants Transfer & Warehouse (1949): State law will determine in diversity when statute of limitations has tolled. (FRCP 3 says a case “commences” when the complaint is filed, but under KS law, suit does not commence until SOP, so SOL had run. P can’t sue)Cohen v. Beneficial Industrial Loan Corp. (1949): Federal court must apply a NJ statute requiring a P to post a bond, even though FCP 23.1 which governs this type of case does not require a bond. Held- the NJ state created substantive liabilities for expenses, not simply procedural. The federal rule doesn’t conflict with the state rule. Woods v. Interstate Realty Co. (1949): MS “door-closing” statute which prevented out-of-state corporations who didn’t register to do business in MS from suing as a P in MS state court also prevented those corporations from suing in MS federal court on state claims.Byrd. v. Blue Ridge Rural Electric Cooperative (1958): Basic federal rights will be upheld though, even if in conflict with state law. Under federal procedure, the issue of P’s employment status is an issue for the jury, but under the state law, it is tried by the judge. Held- right to jury (federal law) affirmed. Limitation on Erie- the preference for state law is not binding if application of such a law would deprive one party of a strongly protected federal right (see 7th amendment), even if the standard “outcome” test is met. It is unclear whether trial by jury v. judge is outcome determinative or not. Mere forms and modes of enforcing immunity are not mandated upon federal courts to be respected. While other cases have shown a deference to state rules even for forms and modes, that was in the absent other considerations. Holding: There is a distinction between a) state created rights and obligations, b) rules bound up with those state created rights and obligations, and c) forms and modes of enforcing rights and obligations. When considering mere forms and modes (like trial by jury), the district court should balance federal countervailing interests with state countervailing interests to decide which to apply.Result- federal courts tended to apply their own policies when making this balancing decision (form and mode, preference for the federal rule). Counterexample- Allstate Ins. Co. v. Charneski (7th Cir. 1960): where court applied state rule forbidding declaratory judgments against insurance companies in the federal court in diversity, so case dismissedHanna v. Plumer (1965): FRCPs, if valid and applicable, are enforced. Facts: OH plaintiff follows FRCP rules for SOP (serves D’s wife at his home), but does not comply with MA state rules for SOP (personal in hand service required). Now the case would be time barred (SOL has run, cannot reserve). Held- SOP governed by FRCP. Rule 4(d)(1) was designed to control SOP in diversity actions. Its adoption neither exceeded the congressional mandate embodied in the Rules Enabling Act nor transgressed constitutional bounds (valid), and therefore the Rule is the standard against which the district courts should measure the adequacy of service (applicable). The goal of the Erie doctrine was to discourage forum shopping and avoid inequitable administration of the laws, and the York test was an attempt at articulating a means to get to that goal. These are still the goals. While now the choice of state or federal rule for SOP would have an effect on the outcome, it is highly unlikely that the means of SOP had an original effect on the P’s choice of where to bring the case- the forum-shopping question is would the difference in laws have made the P make a certain choice in forum when originally deciding where to bring the case. Concurrence (Harlan): His test- if the choice of rule would substantially effect those primary decisions respecting human conduct which our constitutional system leaves to state regulation, then use state law. Is this opinion consistent with Ragan?Hanna test: 1) Is the FRCP a) valid (constitutional and authorized by the Rules Enabling Act) and b) applicable? If the FRCP is valid and applicable, follow that. 2) Non-FRCP federal practice- true Erie analysis. “Twin aims” or “modified outcome determinative analysis”: effectuate the twin aims of Erie (i) discourage forum shopping and (ii) promote the inequitable administration of laws. FRCPs are special- A) Valid = constitutional and authorized by the Rules Enabling Act 28 USC 2072 (would be unauthorized if it abridges, enlarges, or modifies a substantive right- ask yourself, does it really regulate procedure? Sibbach v. Wilson 1941 affirming district court’s order that P undergo a physical exam pursuant to FRCP 35, despite conflict with IL state policy forbidding compulsory physical exams) B) Applicable = direct collision with state law (no way to avoid confliction)Twin Aims analysis- Slight departure from York, focus upon would the choice of law have made a difference in the original choice of forum, not now, would the choice have an effect on the outcome. Note- York and Hanna are still sited as Erie tests.Later DevelopmentsApplying the Hanna test- is the FRCP applicable?Walker v. Armco Steel Corp. (1980): Does Hanna overrule Ragan- No. State law applies for when the statue of limitations tolls. Application of the Hanna analysis for FRCPs is premised on a direct collision between the FRCP and the state law. FRCP 3 is not intended to toll state SOLs or displace state tolling rules, it is for internal deadlines to the FRCP, not about statute of limitations. Following the Hanna analysis, the FRCP is not applicable, so go to the second part: if the question is substantive or something bound up with substantive rights (see Byrd), then follow state law. If a mere form/mode, look to outcome determinative York , effecting twin aims of Hanna test, and Byrd (possible countervailing federal v. state interest). Here, mere form/mode where applying the federal law would be inequitable (one of the twin aims) because it gives P longer in its SOL, so apply the state law. Burlington Northern R. Co. v. Woods (1987): Application of the Hanna test for valid/applicable FRAP. Court held FRAP 38 controlled, even though in conflict with state law. Step 1- applicable: the scope of FRAP 38 was “sufficiently broad” to cause a “direct collision” with the state law or implicitly to “control the issue” before the court (AL state rule forced money damages if you lose an appeal, FRAP said appellate court has discretion to award a penalty only if the appeal is frivolous). Step 2- valid: It was a valid exercise of Congress’ rulemaking authority, from the Constitution, and bestowed on the Court by the Rules Enabling ActStewart Organization Inc. Rioch Corp. (1988): Hanna for Congressional statutes- is it constitutional? Contract between parties had a forum selection clause specifying venue in NY. P sued D in AL, D moved to transfer venue under §1404(a)- federal law respects forum selection clauses, AL law does not. Held- apply §1404(a), transfer the case (federal law trumps). When the federal rule to be applied is a statute and the statute applies to the issue before the court, the statute will be applied if it was enacted within the constitutional limits of constitutional authority. §1404(a) controls the issue and must be applied since it represents a valid exercise of Congress’s authority under the Constitution to make rules governing the practice and pleading in the federal court system. Dissent (Scalia): No direct collision- §1404(a) does not speak to forum selection clauses, it is not applicable. Go to Hanna twin aims analysis, and says applying the federal law would encourage vertical forum shopping, so the court should apply the state law.Erie Analytical Framework – Vertical Choice of LawIs there a statute, FRAP, FRCP involved?If yes, begin with Hanna. Is the rule i) valid? (REA + Constitution) ii) applicable?If the answer is yes to all of the above, the statute/FRCP/FRAP trumps, apply it. If the answer to any of the above questions is “no”, true Erie analysis of which law to apply:Is it a matter of state substantive law or something “bound up” with it, such that the Constitution requires applying state law (at least according to Brandeis)? If so, apply state law.If not, and just a “form or mode” (i.e. procedural)Is the difference between the federal and state law outcome determinative? (York)Would using the state rule frustrate the twin aims of Erie (discourage forum shopping and inequitable administration of law? (if (i) and (ii) conflict, go with (ii))Is there a countervailing federal interest, a state interest, and how do they balance? (Byrd)“Inverse Erie” (brief lecture only)- state courts apply federal law (substantive and procedural)The Basics of Horizontal choice of law – which state’s law to apply?Restatement (First) on Conflicts of Law- lex loci dilicti: For torts, apply the law of the place of the wrong. The place of the wrong is the state where the last event necessary to make an actor liable for an alleged tort takes placeExample: Alabama Great Southern Railroad Co. v. Carroll (1893): P, AL citizen, suing D, AL citizen, in AL state court, but the injury (railroad accident) occurred in MS. Apply the law of MS for negligence theories. (P can’t recover under MS law). Rationale: The fact which created the right to sue, the injury without which no cause of action would lie anywhere, transpired in the State of Mississippi. AL law has no efficiency beyond the lines of AL. Vested rights doctrine- the right to recover owes its creation to the law of the jurisdiction where it occursMovement away from Restatement (1st) approach caused by states not wanting to enforce certain laws that other states had like guest statues, contributory negligence, etc.Restatement (Second) on Conflicts of Law: Interests approach. Consider whether the issue is loss allocation (apply law of the parties’ domiciliaries) v. standard of conduct (apply law of the locus). Consider whether the P and D share a common domicile and the interest of the locus state. Loss allocation v. rule of conduct: When there is a loss allocation rule and the P and D are co-domiciliaries of a state other than locus state, and the conduct is tortious in both places, the locus state has very little interest in applying its loss allocation rule. Instead, use the rule of the law of the state of common domicile. Example: Schultz v. Boy Scouts of America (NY 1985): P’s sons (NJ domiciliaries) sexually assaulted by priest/boy scout troop leader, P want to sue Boy Scouts (NJ, then reincorporated in TX) and Franciscans (OH domiciliaries) in NY state court. NJ law has charitable immunity (i.e. cannot sue Ds), but NY law does not recognize charitable immunity anymore. Injury of the tort was partly in NY (where the boys were molested) and partly in NJ (came back to NJ, emotionally traumatized). Held- NJ law applies (no recovery for P). Why? Babcock analysis says the law of the jurisdiction of common domicile should be applied even if the injury occurs somewhere else because of the home state’s interest in enforcing the decisions of both parties to accept both the benefits and the burdens of identifying with that jurisdiction and submitting to its authority. This case is like reverse Babcock- both parties are out of state, but injury partially occurred in NY. “The law of the jurisdiction having the greatest interest in the litigation will be applied, and the only facts or contacts which obtain significance in defining State interests are those which relate to the purpose of the particular law in conflict.” Erie, moving cases, and choice of lawWhen a federal court sits in diversity, it applies the law of the state in which it sits (this is Erie). This includes that state’s choice of law rules – see Klaxon v. Stentor (1941). States have been given great leeway in deciding what choice of law rules it wants to establish. Alstate Insurance Co. v. Hague: S.Ct. held a state could apply its own substantive law in a case, so long as the state had significant contacts or a significant aggregation of contacts with the parties and the transaction. Recall- venue and PJ: when transferring a case, if venue and PJ were proper in the transferor court, use the law (including choice of law) rules of the transferor court. If venue or PJ were not proper in the transferor court, use the law (including choice of law) rules of the transferee court. (see Transfer of Venue section, supra)Van Dusen v. Barrack (1964): A change of venue under §1404(a) is, with respect to state law, but a change of courtrooms. If venue and PJ were proper, use law of the transferor court (don’t change law). Same rule applies even if it is the P who moves to transfer (Ferens 1990).If venue/PJ was not proper (§1406 transfer), use law of transferee court (Goldlawr)If case is transferred under §1631 to cure lack of PJ, law of transferee court applies, as if the action had started there as an initial matter. DiscoveryOverview and Discovery DevicesPurposes of Modern Discovery: Preserve evidence that may not be available for trial, issue identification and narrowing, obtain information that will lead to admissible evidence.FRCP 26(b) Discovery – General rule: Information can be obtained regarding any matter, not privileged, that is relevant to the claim or defense of any party, whether or not the information sought will be admissible at trial, so long as it is reasonably calculated to lead to the discovery of admissible evidence (subject to judge’s discretion).Types of Discovery: Oral depositions (Rule 30- can be used at trial if witness is dead, will, or beyond the powers of the trial court), written depositions (Rule 31), written interrogatories (Rule 33), Requests for admission (Rule 36), production of documents and property (Rule 34), physical and mental exams (Rule 35)FRCP 26(g)(1)(B) – like Rule 11 for discovery, must be signed by an attorney certifying truthfulness Initial Disclosure and Discovery SanctionsIf you don’t comply with a discovery rule – FRCP 37 (parties meet, then go to judge, judge could force them to comply, could eventually lead to sanctions)FRCP 26(a)(1)(A) Mandatory Initial Disclosures: A party must, without awaiting a discovery request, provide to the other parties (i) names and addresses of each individual likely to have discoverable information – along with the subjects of that information – that the disclosing party may use to support its claims or defenses, unless the use would be solely for impeachment, (ii) a copy of all documents, etc. that the disclosing party has in its possession and may use to support its claims or defenses, unless solely for impeachment, (iii) a computation of each category of damages claimed by the disclosing party, and (iv) any insurance agreement under which an insurance business may be liable to satisfy all or part of a possible judgment or to indemnify or reimburse for payments. Cummings v. General Motors Corp. (10th Cir. 2004): P sued GM alleging design defect in a seat belt that caused injuries during an accident. P lost, then moved for relief from the judgment 60(b)(3) for misconduct, after discovering a safety demonstration video that showed the seatbelt was not safe- they found the video after trial (it was brought out in a different suit). P tried to hold D was required to disclose the video under FRCP 26(a)(1)(A)- Held, for D. D is only required to disclose evidence it intends to use (D was not going to use this). Limitations on Discovery: Attorney Work Product and Attorney-Client PrivilegeFRCP 60(b)(3) and 60(b)(5) – attorney work product (documents made in preparation for trial) is not discoverableThe Duty to Supplement Responses, Spoliation, and the Duty to Preserve EvidenceFRCP 26(e) – A party must supplement or correct any disclosure under FRCP 26(a), an interrogatory, request for production, or request for admission, etc. if in some material respect the disclosure or response is incomplete or incorrect, and if the additional or corrective information has not otherwise been made known to the other parties during the discovery process or in writing. [The duty to supplement does not apply to deposition testimony, except only when opinions expressed by an expert in deposition change – 26(e)(2)]Spoliation Doctrine (=duty not to spoil evidence before litigation has begun. Rules of discovery protects the spoliation of evidence once litigation begins) – Silvestri v. General Motors Corp. (4th Cir. 2001): P failed to preserve material evidence in anticipation of litigation or to notify GM of the availability of the evidence (car in car accident, P claiming products liability, car fixed), thus breaching his duty not to spoliate evidence. Punishment? The power to impose sanctions for spoliation derives from the inherent power of the court to control the judicial process and litigation (federal law), but the power is limited to that necessary to redress conduct “which abuses the judicial process.” Here, case is dismissed. Usually a lesser sanction is preferred (that which is necessary to perform the necessary function), but here, car was the only evidence from which D could make a defense, so district court did not abuse its discretion by imposing the dismissal sanction. Summary Judgment – FRCP 56Introductory Materials and AdickesRecall, 12(b)(6) motion only looks at the pleadings. SJ is like 12(b)(6) after some discovery (see Rule 12(d), if things outside of the pleadings are considered in a 12(b)(6) motion, it is treated like a SJ 56 motion)Asks the question: Is this claim “trial worthy”? Juries serve one purpose, that is, finding facts. If there are no material issues of fact, there is no reason to go to the jury. If there is a credibility dispute though, that is for the jury. Defendants win SJ motions more than plaintiffs. Why? P must show all elements of her prima facie case in order to win SJ (P bears the burden of proof/persuasion on prima facie case), but D need only poke one dispositive hole. FRCP 56 Summary JudgmentA) A party claiming relief may move, with or without supporting affidavits, for summary judgment on all or part of the claim.B) A party against whom relief is sought may move, with or without supporting affidavits, for summary judgment on all or part of the claim. C) (1) Timing- A party may move for SJ at any time until 30 days after the close of all discovery. A party opposing the motion must file a response within 21 days after the motion is served (see E(2) for requirements of the response). (2) The judgment sought should be rendered if the pleadings, the discovery, and the disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law. (if there is a dispositive issue against P, D gets SJ)When deciding whether or not to grant a SJ motion, the judge draws all inferences in favor of the non-moving party, resolves all questions in his or her head about the credibility of affidavits, or the depositions or the documents in favor of the non-moving party. D) Partial SJ (can get SJ on a specific issue or claim). Establishing facts that are not at issue. E) (1) Affidavits (2) When a motion for SJ is properly made and supporting, an opposing party may not rely merely on allegations or denials in its own pleading; rather, its response must – by affidavits or as otherwise provided in this rule – set out specific facts showing a genuine issue for trial. If the opposing party does not so respond, SJ should, if appropriate, be entered against that party. Early understanding of SJ (not as likely to be granted): Adickes v. S.H. Kress (1970): Civil rights case, white teacher refused service in restaurant when with black students then arrest for vagrancy, she claimed conspiracy, D moved for SJ. (Note, P bears the burden of proof/persuasion on conspiracy at trial. Everyone denies the conspiracy, P points to the deposition testimony of one of her students and an unsworn statement from restaurant employee that police officer had been in the store). Held, for P (no SJ for D)- The D has not met its procedural burden of “showing the absence of any disputed material fact” regarding conspiracy. D did not carry its burden because of its failure to foreclosure the possibility of a conspiracy between Kress and the police (by a cop being in the store). While D contends P has not met a burden of showing that there was a conspiracy, court responds that she is the nonmoving party, the D must meet its burden (moving party) first in deciding whether to grant a SJ motion before the burden shifts to the nonmoving party. (mostly overruled) Summary Judgment: The “Trilogy” (and Scott v. Harris)Celotex Corp. v. Catrett (1986): Shift in attitude toward SJ motions – integral part of the FRCPs designed to secure the just, speedy and inexpensive determination of every action. Burden on the moving party: When the D makes a motion for SJ on an issue that is an essential element of the P’s case for which the P bears the burden of proof: 1) the P is not obligated to make a responsive showing unless the D’s motion is “made and supported as provided in Rule 56” (which, notably, does not mean D’s motion needs to be supported by affidavits), 2) the D may discharge that burden by showing that there is “an absence of evidence” to support an essential element of the P’s case on which the P will bear the burden of proof at trial (point out a deficiency in P’s case), 3) the D can make this showing using any documents in Rule 56(c0, pleadings, depositions, answers to interrogatories, admissions, with or without supporting affidavits, 4) If the D makes that showing of an absence of evidence on an essential element of the P’s case, the P must respond by making “a sufficient showing” with respect to that element, 5) the P’s showing is sufficient when her supporting material are such that “if reduced to admissible evidence,” they would be sufficient to carry her burden of proof at trial.No requirement in Rule 56(c) that the moving party support its motion with affidavits or similar materials negating the opponent’s claim (that is one route, from Adickes). Another route to the grant of a SJ motion is simply pointing out an absence of evidence on the other party’s side when that party bears the burden of production/persuasion.Concurrence/Dissent – very similar. Two ways for moving party to get SJ when the nonmoving party bears the burden of proof. 1) foreclose the possibility- Adickes. 2) point out an absence of evidence – Celotex. When the party with the burden of proof might win a SJ in its favor: Scott v. Harris (2007): D pled qualified immunity (D bears burden of proof) in civil rights action case where P was running from the cops and cop ran him off the road. S.Ct. granted D’s motion for SJ because of videotape of the accident clearly contradicts P’s version of the facts, so no reasonable jury could believe P’s version, so there is no genuine issue of material fact. Anderson v. Liberty Lobby (1986): Substantive evidentiary standards for SJ = same as for trial. The substantive evidentiary standards that apply to the case at trial guide a determination of whether a genuine issue of material fact exists when making a SJ determination. In ruling on a motion for SJ, the judge must view the evidence presented through the prism of the substantive evidentiary burden that would need to be met at trial (so here, in a libel case, the standard is “clear and convincing” evidence in proof of malice. P has failed to present “clear and convincing” evidence, so SJ for D properly granted).Matsushita Electric Industrial Co. v. Zenith Radio Corp. (1986): While we give all reasonable doubts to the non-moving party in evaluating a motion for SJ, the doubts have to be reasonable, and when the moving party’s theory is implausible, we can demand very strong evidence in order to avoid SJ. Facts: American TV manufacturers suing Japanese manufacturers for conspiracy in predatory pricing to monopolize the US market. SJ for D. Held- absence of a plausible motive to engage in predatory pricing, and this absence is highly relevant to whether a “genuine issue for trial” exists, since if the Ds had no rational economic motive to conspire, and if their conduct is consistent with other equally plausible explanations, the conduct does not give rise to an inference of conspiracy. Therefore, no triable issue of fact. Trial by Jury and Motion for Judgment as a Matter of Law (Directed Verdict)Introduction to Trial7th Amendment: In suits at common law, where the value in controversy shall exceed $20, the right of trial by shall be preserved. (Historical test- would you have had a right to a jury trial in 1791?)Choosing a Judge or Jury for TrialEither party can demand a trial by jury if it a jury-triable issue. Under FRCP 38(d), if neither party demands a jury trial, it is waived. FRCP 38 Right to a Jury Trial; Demand: a) The right of trial by jury as declared in the 7th Amendment of the Constitution is preserved to the parties inviolate. b) (1) On any issue triable of right by a jury, a party may demand a jury trial by serving the other parties with a written demand – which may be included in a pleading - no later than 14 days after the last pleading directed to the issue is served. c) A party may demand that all issues be tried by a jury, or only certain issues. d) A party waives a jury trial unless its demand is properly served and filed. A proper demand may be withdrawn only if the parties consent.FRCP 39 Trial by Jury or by the Court: a) When a jury trial is demanded, action is set on the docket as a jury action. The court may on its own or by motion find that some or all of the issues however do not have a federal right to a jury trial. b) If no demand for a jury trial is made, issues are to be tried by the court. But the court may, on motion, order a jury trial on any issue for which a jury might have been demanded. (exercised sparingly) The Federal Constitutional Right to a Jury TrialThe Law/Equity Distinction & Fact/Law Distinction: In 1791, claims for legal relief (“common law” 7th amendment) had a right to a jury trial, but claims for equity (injunctions, declaratory judgments, etc.) were tried by judges. The distinction continues today. What about claims where legal and equitable are both sought? Also, conditional on having a right to a jury trial, juries only try facts, judges try law. Bereslavsky v. Caffey (2nd Cir. 1947): original complaint only requested equitable relief (no jury trial), complaint was then amended to include complaint for monetary damages. Court held, even though the Rule 38(b) time period had expired, while the original complaint carried no right to a jury trial, a later amendment changing the claim from equitable to legal relief renewed the right and gave P an additional 10 days to demand a jury. But see American Home Products v. Johnson & Johnson (SDNY 1986) where opposite conclusion was reached.Pre-Beacon Theaters If case involves law and equity, look to the center of gravity of the case to determine if it should be tried by a jury or a judge. Beacon Theaters v. Westover (1959): (major expansion of a right to a jury trial in the law/equity distinction) 1) If an issue of fact underlies a claim for legal relief, it must be tried by a jury, without regard to whether the overall thrust or tenor of the case is equitable. 2) If an issue of fact underlies both a claim for legal relief and equitable relief, it must be tried to a jury. 3) Only if an issue of fact underlies a purely equitable matter is it tried to the judge without a jury. 4) Unless there are “imperative circumstances, circumstances which in view of the flexible procedures of the FRCPs we cannot now anticipate” to the contrary, the jury issues shall be tried before the equity issues. This order of trial ensures that the judge will be bound by the jury’s determination of the facts, rather than vice versa. What about cases where the cause of action did not exist in 1791? Chauffers, Teamsters v. Terry (1990): Two-pronged test: 1. Federal court is to determine whether the claim asserted has an 18th century analog in common law. 2. Examine the remedy sought and determine whether it is legal (jury) or equitable (judge) in nature. Fact/Law Distinction: Conditional on having the right to a jury trial… In a bench-trial, judge decides issues of fact and law. In a jury trial, judges decide law (through jury instructions) and juries decide facts. FRCP 51 requires a party to make a precise objection to a jury instruction before the jury retires to deliberate, or the objection is waived. Can be difficult to tell if a question is a question of law or of fact- court should allocate in a manner based upon the idea that one party may be better suited to decide something than another (Markman v. Westview Instruments 1996) Juries usually return general verdicts, but they can return special verdicts (FRCP 49(a)) where juries respond to specific questions. FRCP 58(a)(1) - Once a verdict is returned, judge must enter judgment. Once only judgment is entered does the clock start running for post-trial motions/appeals.Challenging Individual JurorsTwo types: 1. For cause challenges – unlimited. 2. Peremptory challenges – 3 each in federal system (28 USC §1870).Flowers v. Flowers (Tx. App. 1965): Potential juror expressed extreme displeasure with wife (P’s) occasional drinking in child custody dispute. Held- the juror should have been dismissed for cause (i.e. bias/prejudice). Where a reasonable probability of bias is shown, disqualification for cause is not a matter of discretion with the trial court, but is a matter of law (must be disqualified). Edmonson v. Leesville Concrete Company (1991): excluding jurors by race (in civil or criminal actions) is unconstitutional. Same reasoning of a constitutional violation for excluding jurors in criminal cases for race (Powers 1991, Batson 1986) applies to private litigants in jury selection because the entire process of determining who will serve on the jury constitutes a state action. Dissent: this is not state action, private litigants doing the excludingJEB v. Alabama (1994): Use of preemptory challenges to exclude persons on the basis of gender also unconstitutional violation of the 14th amendment’s equal protection clause Motion for Judgment as a Matter of Law (JMOL) (Directed Verdict) – FRCP 50(a)Does JMOL violate the 7th Amendment? No Galloway v. United States (1943): In 1791, not all issues went to the jury- there were demurrers and motions for new trials. While today’s practices of DV/JMOL differ from the old procedures, the 7th amendment was designed to preserve the basic institution of jury trial in only its most fundamental elements, not the great mass of procedural forms and details, varying even then so widely among common-law jurisdictions. It is not unconstitutional for a federal court to take a case from the jury by directed verdict where evidence is clearly insufficient to support a right to relief. Dissent (Black): A verdict should be directed, if at all, only when, without weighing the credibility of the witnesses, there is in the evidence no room whatsoever for honest difference of opinion over the factual issue in controversy. We must restrain our power. FRCP 50(a) – If a party has been fully heard on an issue during a jury trial and the court finds that a reasonable jury would not have a legally sufficient evidentiary basis to find for the party on that issue, the judge may resolve the issue against the party and grant a motion for JMOL against the party.So after a P has presented all of her evidence, D can move for JMOL. Then after the D has presented his evidence, P or D can move for JMOL. (the opposing party must have had their chance to present their evidence. P goes first in trial)50(a)(2) – a JMOL motion can be made at any time before the case is submitted to the jury. 52(c) is a 50(a) JMOL for judge-tried cases. If a party has been fully heard on an issue during a nonjury trial and the court finds against the party on that issue, the court may enter judgment against the party on a claim or defense. Tests for determining if a JMOL should be granted:1) “Mere Scintilla” Test (mentioned in Galloway): As long as there is a mere scintilla of evidence supporting the non-moving party’s case, deny the motion2) “Plaintiff’s evidence” (nonmoving party’s evidence) test: Look at only the evidence of the nonmoving party, take all reasonable inferences therefrom in light most favorable to the nonmoving party, and enter JMOL only if that evidence standing alone would be insufficient. 3) Federals standard for evaluating SJ (56), JMOL (50(a)), and JNOV (50(b)) Motions – Reasonable Persons could not Disagree: (articulated in Boeing Co. v. Shipman 5th Cir 1969): Court should consider all evidence (not just evidence which supports nonmoving party’s case), but in the light and with all reasonable inferences most favorable to the nonmoving party. There must be a conflict in substantial evidence to create a jury question (a mere scintilla is insufficient- reject that test). However it is the jury’s role, not the Court, to weigh conflicting evidence and inferences and determine the credibility of witnesses. If the facts and inferences point so strongly and overwhelmingly in favor of one party that the Court believes that reasonable men could not arrive at a contrary verdict (no reasonable jury could reach a contradicting conclusion), granting of the motion is proper. Application – Penn RR v. Chamberlain (1934): direct conflict of testimony upon a matter of fact is a question for the jury to resolve. But here, there is no conflict in the testimony as to the facts. Witnesses say they say no collision, P’s only witness does not testify to seeing collision, only hearing a loud crash. JMOL should be granted. Post-Trial Motions(Focus on 3 post-trial motions: 1) Renewed JMOL (or JNOV), 2) Motion for a New Trial, 3) Motion for Relief from a Judgment or OrderThe Renewed Motion for Judgment as a Matter of Law (RMJOL) (aka Motion for Judgment as a Matter of Law After the Verdict- JNOV) – FRCP 50(b)JNOV = judgment “non obstante verdicto” (notwithstanding the verdict) = Renewed Motion for Judgment as a Matter of Law = RJMOL. Must have moved for an original JMOL in order to move for a Renewed JMOL. Why? Constitution 7th Amendment says “no fact tried by a jury shall be otherwise re-examined in any Court of the US, other than according to the rules of the common law.” It was in that regard that the S.Ct. in Slocum v. New York Life Insurance Co. (1913) held that once the trial court has denied a D’s directed verdict motion and allowed the case to go to the jury, the court could not order a judgment contrary to the jury verdict, but could only order a new trial. Baltimore & Carolina Inc. v. Redman (1935): A RJMOL is constitutional because under Rule 50(b), the court does not deny the original JMOL, it merely reserves judgment on it until after the jury has returned its verdict; jury verdict is taken subject to trial court’s decision on the motion. This is constitutional. FRCP 50(b): If the court does not grant a JMOL under 50(a), the court is considered to have submitted the action to the jury subject to the court’s later deciding the legal questions raised by the motion. No later than 28 days after the entry of judgment, a party may move for RJMOL, and may include an alternative or join request for a new trial Rule 59. The court may then 1) allow judgment on the verdict, 2) order a new trial, or 3) direct entry of judgment as a matter of law. Standard of review is the same as original JMOL (federals standard, supra). In order to file a RJMOL, a party must have filed an original JMOL.Recall that a defendant can make a JMOL twice (once after close of P’s evidence, then after close of his own evidence). When making a RJMOL, it is on the basis of whatever the original JMOL was- so if a D only makes a JMOL at the end of P’s evidence, its RJMOL will only consider P’s evidence (so D should always make the JMOL twice, or definitely after the close of his own evidence). Motion for a New Trial – Rule 59 (often combined with RJMOL motion)FRCP 59 (b): A motion for a new trial must be filed no later than 28 days after the entry of judgment. 59(d): Court can grant a new trial without a motion (sua sponte) within 28 days after entry of judgment. FRCP 59(a) Grounds for a New Trial: The court may, on motion, grant a new trial on all or some of the issues – and to any party – for any reason for which a new trial (or rehearing, in nonjury trial) has heretofore (i.e. previously) been granted in an action at law in federal court. (note, can grant “partial” new trial i.e. to just one issue or one party)Two main reasons for granting a new trial: 1) Procedural error (ex: improper admission or exclusion of evidence, improper jury instructions that put burden of persuasion on wrong party, must be “prejudicial”, not a harmless error2) Verdict against the great weight of the evidence: Aetna Casual & Surety Co. v. Yeatts (4th Cir. 1941): P insurance, D illegal abortions, indemnification dispute. Held- affirmed denial of motion, but also affirmed right of trial courts to grant a new trial. Why? The right of the court to grant a new trial whenever, in its sole discretion, the verdict constituted a miscarriage of just was well recognized in common law. Therefore, grant of a new trial for a verdict against the weight of the evidence is not an unconstitutional deprivation of the limited right to jury trial reserved by the 7th amendment. What is the difference between standard for granting a RJMOL v. a motion for a new trial? The distinction between the rules to be followed in granting a new trial and in directing a verdict (RJMOL) are: where there is substantial evidence in support of P’s case, the judge may not direct a verdict against him, even though he may not believe his evidence or may think that the weight of the evidence is on the other side (that would be unconstitutional). He may however set aside a verdict supported by substantial evidence where in his opinion it is contrary to the clear weight of the evidence or is based upon evidence which is false. For even though the evidence may be sufficient to preclude the direction of a verdict, it is still his duty to exercise his power over the proceedings before him to prevent a miscarriage of justice. (lesser standard for granting a new trial than RJMOL- there’s a gray area where granting RJMOL is not proper, but granting new trial is) Modern Statement of Standard for Granting 59 Motion for a New Trial: If, having given full respect to the jury’s findings, the judge on the entire evidence is left with the definite and firm conviction that a mistake has been committed, it is to be expected that he or she will grant a new trial. (Wright & Kane treatise)Application: Marsh v. Illinois Center (5th Cir. 1949): new trial can be granted even if there are no errors of law. Trial judge believed that the weight of the evidence was overwhelmingly against the P, but the jury returned a verdict for the P. While there was not enough evidence for the grant of JNOV since the jury believed the evidence for the P, the trial judge can authorize a new trial. Motion for a new trial cannot be appealed immediately (because it is not a final judgment- see final judgment rule, infra). A party opposing a motion for a new trial must wait until the resolution of the second trial in order to appeal the grant of the new trial. If that appeal is granted, original judgment is reinstated. If that appeal is denied (lose on appeal), judgment of the second trial stands. Combined RJMOL and New Trial Motions: (allows the appellate court to consider all of the losing party’s objections without remand for decision of further post-trial motions- efficient)FRCP 50(c) Granting the JMOL, conditional ruling on a motion for a new trial – If a court grants a RJMOL, it must also conditionally rule on any motion for a new trial by determining whether a new trial should be granted if the judgment is later vacated or reversed (i.e. if the appellate court reverses the trial court’s grant of RJMOL). Conditionally granting the motion for a new trial does not affect the judgment’s finality; if the judgment is reversed, the new trial must proceed (unless the appellate court orders otherwise). FRCP 50(d) If you win at trial, but a RJMOL is granted by the trial court against you (so the court directs a verdict against you), within 28 days of judgment, you can yourself move for a 59 new trial.FRCP 50(e) If the court denies the RJMOL, the prevailing party may, as appellee, assert grounds entitling it to a new trial should the appellate court conclude that the trial court erred in denying the motion. (hedging your bets- you win, but the other party is appealing their RJMOL- saying that if appellate court reverses on the RJMOL, you want to appeal for a new trial)Conditional New Trial (additur and remittitur)Recall, a new trial can be partial. It could just be a trial on damages, or, court can use additur and remittitur to adjust damages.Remittitur: take less (P), or I will grant a new trial on damages. An order denying D’s application for a new trial conditional on the P consenting to a specified reduction in the jury’s award. Widely recognized, can use in federal courts Additur: give more (D) or I will grant a new trial on damages. An order denying the P’s application for a new trial conditional on the D consent to a specified increase in the jury’s award (some states use, cannot use in federal court)Dimick v. Schiedt (1935): In federal courts, remittitur is constitutional, but additur is not. Additur violates the 7th Amendment because the jury has set a maximum, which a court cannot increase. (was not recognized in English courts when Constitution was written)Fisch v. Manger (NJ 1957) established additur as constitutional under NJ law (remember, 7th amendment doesn’t apply to the states, about federal deprivations), saying it violates none of NJ’s constitutional interdictions and serves a laudable purposeMotion for Relief from Judgment – FRCP 60FRCP 60(a) – correction of clerical errors in the entering of judgmentFRCP 60(b) (court changing its mind) On motion and just terms, the court may relieve a party from a final judgment for the following reasons: 1) mistake, inadvertence, surprise, or excusable neglect (often for default judgment) 2) newly discovered evidence that with reasonable diligence could not have been discovered in time to move for a new trial under Rule 59(b), 3) fraud, misrepresentation, or misconduct by the opposing party, 4) the judgment is void (usually for lack of SMJ), 5) judgment has been satisfied, released, or discharged, is based on an earlier judgment that has been reversed or vacated, or applying it prospectively is no longer equitable, or 6) any other reason (not covered by 1-5) that justifies relief. (extraordinary circumstances) C) Timing – must be within a reasonable time, 1-3 must be within a year of judgment entry. The motion does not affect the judgments finality or suspend its operation. Consequence of a grant of a 60(b)- depends on the situation, sometimes the judge can correct the error, sometimes new trial. Denial of a 60(b) motion is reviewed (appealable) for abuse of discretion. Example: Patrick v. Sedwick (AK 1966): Held- trial court did not abuse its discretion in denying D’s motion (seeking new trial, like 60(b)(2) motion) on the grounds of newly discovered evidence because newly discovered evidence means evidence that existed at the time of the trial, not evidence discovered after the trial (medical technique did not exist at the time the trial took place, so cannot be used as reason to reduce P’s damages for mitigation). Test for 60(b)(2): To get relief on newly discovered evidence, you must meet the following requirements: 1) must be such as would probably change the result on a new trial, 2) must have been discovered since the trial, 3) must be of such a nature that it could not have been discovered before trial by due diligence (this is where Cummings case, supra, failed), 4) must be material, 5) must not be merely cumulative or impeaching, 6) must relate to facts where were in existence at the time of trial (this is where this case fails). Note- Title v. United States (9th Cir. 1959): Rule 60(b) does not permit a case to be reopened for consideration of a change in the applicable law. Nor is a change in the judicial view of applicable law after a final judgment a sufficient basis for vacating the judgment entered before the announcement of the change. Changes in law not enough. Peacock Records v. Checker Reocrds (7th Cir. 1966): If judgment was obtained in party by the use of perjury, it is the duty of the district court to set aside the judgment. Appellate court held district court abused its discretion by not granting the FRCP 60(b)(3) motion. Brown v. Pennslyvania Railroad (3rd Cir. 1960): P sued his employer D under FELA. D’s medical experts said P could work again, so his damages reduced. D then fired P, relying on P’s experts (who said he could not work). P moved for a new trial on damages under Rule 60(b)(3), but the motion was denied and appellate court affirmed- consistent with Peacock? AppealThe Final Judgment Rule (and Built-In Exceptions)Basic rule = only final judgments are appealable (28 USC §1291: The courts of appeals shall have jurisdiction of appeals from all final decisions of the district courts). 28 USC §1292 There are enumerated exceptions for when an interlocutory decision is appealable including rulings on injunctions and appointments of receivers. Also, when a district judge makes an order that is normally not appealable but he feels involves a i) controlling question of law as to which there is ii) substantial ground for difference of opinion and iii) an immediate appeal may materially advance the ultimate termination of the litigation, he may ask the Court of Appeals to permit the appeal- this is certification. (both have to agree) Liberty Mutual Insurance Co. v. Wetzel (1976): P had one claim for gender discrimination, but sought various types of relief. Court granted P’s motion for SJ on D’s liability and won. D appealed- S.Ct. held, this was not appealable (S.Ct. raised the issue sua sponte). The order establishing D’s liability is not a final judgment under §1291 because the issues of damages/injunction still need to be decided. [All theories of appealability fail- 1) 54(b) appealability under §1291 does not apply to a single claim action, but is only for appellate review of a final judgment for one claim in a multi-claim case, or review of final judgment against one party in a multi-party case. 2) while partial SJ can be granted (56(d)(2), it is not always a final judgment- other things may still need to be done, so not appealable under §1291). 3) Not a 1292(b) certification. 4) None of the §1292 exceptions apply.] Why are only final judgments appealable? NY Approach- allows appeals for many situations in which no final judgment has been rendered. System design question. The Collateral Order DoctrineCohen v. Beneficial Industrial Loan Corp. (1949): Dispute over whether P in a shareholder’s derivative suit in NJ federal court (state law claim) needs to post a bond (pursuant to NJ law, but not required by state law- Erie case). Was the issue of posting a bond appealable? Held- yes. Collateral Order Doctrine: This order was appealable because it is a final disposition of a claimed right which is not an ingredient of the cause of action and does not require consideration with it. Small class of decisions which i) finally determine claims of right ii) separable from, and collateral to, rights asserted in the action, iii) too important to be denied review and iv) too independent of the cause itself to require that appellate consideration be deferred until the chose case is adjudicated. Will v. Hallock (2006): Application of the collateral order doctrine of Cohen. Requirements of the collateral order appeal – very small and special class: 1) the order conclusively determines the disputed question, 2) the order resolves an important issue completely separate from the merits of the action, and 3) the order must be effectively unreviewable on appeal from a final judgment. Mere avoidance of a trial is not enough to invoke the collateral order doctrine, but avoidance of a trial that would imperil a substantial public interest that counts when asking whether an order is “effectively” unreviewable if review is to be left until later. Here, denial of D US agent’s motion to dismiss on the ground that a federal statute §2676 barred the action is not immediately appealable (different from denials of qualified immunity, which concerns a public interest, here, the agents just want to avoid litigation). Result – collateral order doctrine is very limited. One situation where it has be held applicable (i.e. an order is immediately appealable) is when a party refuses to obey a court order and would be held in criminal contempt (i.e. placed in jail)- see US v. Nixon (1974) Mandamus (brief lecture only)As another method of getting around the final judgment rule, a party can petition the appellate (or even S.Ct.) for “extraordinary writs” such as mandamus = ordering the trial court to do something it has a mandatory duty to do or prohibition = ordering the trial court to stop doing something it has no jurisdiction to do (28 USC §1651(a)). Required preconditions for granting writ of mandamus: 1) no adequate means to get the relief sought, 2) movant shows that the right to relief is clear and undisputable, 3) the court issuing the writ must exercise its discretion and be satisfied that the writ is appropriate under the circumstances. Standard of Review and Timing of AppealPure questions of law: Standard of review is de novo (no deference given to the trial court’s decision). Pure questions of fact (“historical fact”): (very deferential) When judge is sitting as fact finder, only set aside findings of fact that are “clearly erroneous” (only if “on the entire evidence, the appellate court is left with the definite and firm conviction that a mistake has been committed”- Pullman-Standard v. Swift 1982). When there is a jury trial (even more deferential because of the 7th amendment constitutionality concerns), ask if a reasonable fact-finder could have reached the conclusion reached, with all evidence, including all credibility determinations and inferences, resolved in the light most favorable to the verdict. Mixed questions of law and fact (applying law to fact): Reviewed de novo. Decisions at the district court’s discretion: Review is for “abuse of discretion”Timing: Appeals made by filing a “notice of appeal” with district court within 30 days after judgment pursuant to FRCP 58 is entered (FRAP 4(a)(1)(A)). If a post-trial motion (RJMOL, motion for a new trial, etc.) is pending, the time for filing a notice of appeal does not run until there is an order deciding that motion (FRAP 4(a)(4)). District court can extend the time to file, if the extension motion comes before the end of the 30 days (FRAP 4(a)(5)).Former Adjudication: Claim and Issue PreclusionClaim Preclusion (“Res Judicata”)Claim preclusion = the rule against claim splitting (a valid final adjudication of a claim precludes a second action on that claim or any part of it- forecloses litigation of matters that should have been brought in an earlier suit). Pled as a defense by D (Rule 8)The test for claim preclusion: To find claim preclusion, 1) case 1 must result in a final judgment, 2) the judgment in case 1 must be “on the merits”, 3) the decision in case 1 must be “valid”, 4) the claims must be the same in case 1 and case 2, 4) Case 1 and Case 2 must assert by the same claimant (or their privy) against the same defendant (or their privy).Final Judgment- cannot be an interlocutory order. If you bring multiple claims however and a court dismisses one of them, this is not considered a final judgment (yet) since the court can reconsider the claim later. See Federated Department Stores v. Moitie (1981) where Ps claims were dismissed, 5 Ps appealed, 2 instead refiled in state court, those 2 were held claim precluded from rejoining the action with the first 5 when their claims dismissal was reversed for change in law. There is simply “no principle of law or equity which sanctions the rejection by a federal court of the salutary principle of res judicata.” Res judicata is a rule of fundamental and substantial justice, of public policy, and of private peace, which should be cordially regarded and enforced by courts. On the merits- did you have the opportunity to litigate on the merits? SJ, JMOL, trial are all on the merits, a dismissal for lack of SMJ, PJ, or venue is not on the merits. 12(b)(6)? S.Ct. says (in Moitie) that if P has been given opportunity for amendment or amendment is futile, then 12(b)(6) dismissal is on the merits. (some states allow re-litigation when first case was 12(b)(6) dismissed) Valid- court adjudicating first case had SMJ and PJ (and no fraud).Claims must be the same in Case 1 and Case 2- Federal approach: A party pressing a claim in Case 1 is precluded from litigating another claim in Case 2 if that claim arises out of the same transaction and occurrence as the claim originally litigated (note implication for permissive claim joinder under FRCP 18(a)- it’s permissive, but if same T&O, you will be claim precluded). Consider T&O tests listed, supra. Primary Rights Theory (some states, like VA, use for whether the claims are “the same”): each separate right violated generates a separate claim, even if the rights were violated in the same T&OOther older approaches: if same evidence would support the claim in both actions, then this is the “same claim”; same claim if allowing case 2 to be litigated could impair or contradict the result in case 1; same claim if same legal theoryExample: Rush v. City of Maple Heights (OH 1958): P cannot separately litigate damage to personal property and personal injury resulting from the same motorcycle accident. D’s negligent action constitutes but one tort. Transactional test is the most commonly used test for determining the preclusive effect of a prior judgment- under the test, the preclusive effect of a prior judgment extends to all rights the original P had with respect to all or any part of the transaction, or series of connected transactions, out of which the original action rose- are they the same nucleus of operative facts (Petro-Hunt v. US 5th Cir. 2004). Rush overrules Vasu (OH case) that had previously allowed P to separate property and personal damages.Example: Mathews v. New York Racing Association (SDNY 1961): The term “claim” refers to a group of facts limited to a single occurrence or transaction (same T&O) without particular reference to the resulting legal rights. The P is not permitted to splinter his claim into a multiplicity of suits and try them piecemeal at his convenience. The same facts are pleaded here to support his claims for malicious prosecution/false arrest as he pleaded previously for libel/assault – this is not allowed. As the law provides a beginning for litigation, it must also provide an end. Same claimant against same defendant (or their privies) – Privy = substantial control (ex: insurance company controlling insured’s defense- the party vicariously participated in the first action by controlling or having the opportunity to exert control over the litigation), or virtual representation Issue Preclusion (“Collateral Estoppel”)BasicsIssue preclusion = if an issue of fact or law has been actually litigated and resolved by a valid final judgment, it binds the parties in any subsequent action (cannot relitigate the same issue). Party seeking issue preclusion bears burden of showing that the requirements are met by presenting the court with an adequate record of first case for judge to review.The test for issue preclusion: To get issue preclusion: 1) Case 1 must have ended in a valid final judgment on the merits. The issue for which you are seeking preclusion in Case 2 must 2) have been actually litigated and actually determined in Case 1, 3) necessarily determined in Case 1 (aka “essential to the judgment”), and 4) must be the same issue as the one that was actually litigated, determined, and necessarily determined in Case 1. (1) = valid, final, on the merits (same as 1-3 for claim preclusion)(2) Actually litigated and actually determined. See Cromwell v. County of Sac (1876) where P was allowed to sue separate on a different coupon, the issue of whether he was a valid holder of the bond had not been raised (actually litigated) in first case. Admissions made in pleadings, etc. are not actually litigated and cannot be issue precluded later (there may be many reasons why a party may not raise an issue or contest an assertion in a particular action – may be too small of a case. Want to encourage compromise and not intensify litigation, strong favor of nonpreclusion). When juries return general verdicts (where parties brought multiple theories of liability and defenses, so actually litigated), cannot get issue preclusion (because the particular theories were not actually determined- just generally). (3) necessarily determined – essential to the judgment. If issues are determined but the judgment is not dependent on those determinations, no issue preclusion. Ask yourself, if the finding on this issue had come out the other way, would the judgment be the same? (if so, no issue preclusion, it wasn’t necessarily determined). Why? Justifications of jury (in)attention and no appeal for winners, even if you disagree with part of the judgment. (Winning too much for Ds? Federal courts split as to whether the party can get issue preclusion) (4) Same issue (the “characterization” question) – Standard, multi-factorial test for whether the issues are the same: 1) Is there substantial overlap between the evidence or argument to be advanced in the second proceeding and that advanced in the first? 2) Does the new evidence or argument involve application of the same rule of law as that involved in the prior proceeding? 3) Could pretrial preparation and discovery relating to the matter presented in the first action reasonably be expected to have embraced the matter sought to be presented in the second? 4) How closely related are the claims involved in the two proceedings? Usually issue preclusion is for fact, or law applied to facts (not typically for pure questions of law)MutualityYou can only use issue preclusion against someone who was a party (or in privity with a party) in Case 1, because of the Due Process clause (opportunity to be heard). To simplify, a party can only be bound by issue preclusion if they (or their privy) were a party to Case 1.Original rule of mutuality- only parties who were bound by a judgment could invoke it later. New idea Bernhard v. Bank of America Nat. Trust & Sav. Ass’n (CA 1942): P sued D for stealing from mother (deceased), held for D that the money was a gift. Then in second suit, P sued Bank for allowing D to withdraw money from the bank, Bank sought to use issue preclusion (establish that the money was a gift). Held- Bank can use issue preclusion. No DP concern because P (who issue preclusion is sought against) was a party in the first case. No rational reason has been advanced for why this should not be allowed. All the other requirements of issue preclusion stand, but it is sufficient if the party against whom the estoppel is asserted was a party in the first case. Nonmutual defensive collateral estoppel – use of issue preclusion as a shield. Blonder Tongue Laboratories v. University of IL (1971): S.Ct. recognized nonmutual defensive collateral estoppel as constitutional. (Patent holder not permitted to sue on his patent after it had once been found invalid following opportunity for full and fair trial). Permitting a P to repeatedly litigate the same issue is a waste of resources. Judges have discretion to decide if a plea of collateral estoppel should be accepted or rejected. Nonmutual offensive collateral estoppel – use of issue preclusion as a sword: (a P seeks to preclude a D from relitigating an issue which D previously litigated and lost against a different P) Should we allow it? Efficiency/consistency v. fairness to D.Parklane Hoisery Co. v. Shore (1979): (P brought stockholder’s class action against D for false proxy statements. SEC had previously won a declaratory judgment establishing P’s liability on essentially the same issues.) Held- The preferable approach for dealing with allowing nonmutual offensive collateral estoppel is not to preclude it, but to grant trial courts broad discretion to determine when it should be applied. General rule - Parklane factors – 1) if P could have easily joined in the earlier action or where for other reasons 2) it may be unfair to the D to allow offensive estoppel ((a) procedural differences, (b) incentives in the first case to not litigate fully and vigorously, (c) inconsistent judgments have already been entered), a trial judge should not allow the use of offensive collateral estoppel. Next concern: There is not a constitutional problem for nonmutuality (because D had full opportunity to litigate in first case)- the law has evolved since 1791. Dissent: 7th amendment “preserves” the right to a jury trial. Common law in 1791 would have allowed D to have a jury trial (only defensive collateral estoppel was permitted) Some states do not allow nonmutual issue preclusion, but make an exception for vicarious liability/indemnification. Some states allow defensive issue preclusion, but not offensive.Federal system – defensive and offensive issue preclusion allowed at judge’s discretion (some states follow this)Class ActionsIntroductionEfficiency + empowerment of Ps (create incentives to deter institutional wrongdoing) v. fairness to absent class members, inflated product pricesCertification is critical, usually leads to settlement. Certification can be altered, amended, etc. at any time before final judgment 23(c)(1)(C). (not a final judgment, but is appealable)CertificationThe FRCP 23(a) RequirementsFRCP 23(a): One or more members of a class may sue or be sued as representative parties on behalf of all members only if 1) the class is so numerous that joinder of all members is impracticable, 2) there are questions of law or fact common to the class, 3) the claims or defenses of the representative parties are typical of the claims or defenses of the class, and 4) the representative parties will fairly and adequately protect the interests of the class.FRCP 23(c) – At an early practicable time, the court must determine by order whether or not to certify the action as a class action. The order must define the class. (23(c)(1)(B)).Example: Communities for Equity v. Michigan High School Athletic Association (WDMI 1999): Court certified class defined as “all present and future female students enrolled in MHSAA member schools who participated in athletics or were deterred from participating in athletics because of D’s discriminatory conduct and who are adversely affected by that conduct.” Held that it met the requirements. Six 23(a) requirements of identifiabiltiy (23(c)(1)(B)), class representative must be a member of the class (23(a) beginner), numerosity (23(a)(1)), commonality (23(a)(2)), typicality (23(a)(3)), and fair and adequate representation (23(a)(4)).Numerosity – more than 40 granted, less than 25 denied. In between, consider geographic dispersion and size of individual monality – common questions (usually found). Critical question is whether differences in the factual background of each claim will affect the outcome of the legal issue. See Wal-Mart v. Dukes (2011) – cannot certify 1.5 million Wal-Mart female employee class claiming Title VII discrimination based on “corporate culture” – claims don’t depend on a common contention (same supervisor, etc.)Typicality – each class member’s claim arises from the same course of events and each class member makes similar legal arguments to prove D’s liabilityGeneral Telephone Co. v. Falcon (1982): P’s class action was denied because it failed typicality- P claimed to have not been promoted because he was Mexican American, sought to certify class as all Mexican Americans wrongfully not hired and not promoted.Fair and adequate representation – representative must be adequate and the attorney must be adequate (23(g)(1)(A). Amchem Products v. Windsor (1997): there shouldn’t be conflicts of interest between named parties and the class they seek to represent. The interests here of those within the single class are not aligned. (An absent party whose interests have not been adequately represented will be permitted to collaterally attack the class action judgment)The FRCP 23(b) Requirements – 3 types of class actionsFRCP 23(b): 1) Prejudice Class Actions- where not maintain a class action would prejudice either the non-class party or other parties who could have been in the class. Mandatory class action (cannot opt out, similar to Rule 19). 23(b)(2) Injunctive and Declaratory Relief sought (most common type of class action). Mandatory class action, notice not usually required. Not everyone in the class has to be offended by D’s acts. Johnson v. General Motors Corp. (5th Cir. 1979): If a 23(b)(2) class seeks injunctive relief and compensatory damages, notice may be mandatory if absent class members are to be bound. But when only equitable relief is sought, the DP interests of absent members will usually be safeguarded by adequate representation alone. It may not always be necessary for notice here to be equivalent to the notice requirements for a 23(b)(3) (i.e. can delay). But before an absent class member may be forever barred from pursuing an individual damage claim however, DP requires that he receive some form of notice.23(b)(3) Damage Class Actions – the court finds that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods of fairly and efficiently adjudicating the controversy. 4 matters to consider in whether to certify this type: A) the class members’ interests in individually controlling the prosecution or defense of separate actions, B) the extent and nature of any litigation concerning the controversy already begun by or against class members, C) the desirability or undesirability of concentrating the litigation of the claims in the particular forum, and D) the likely difficulties in managing a class action. Castano v. American Tobacco (5th Cir. 1996): P sought to certify a class as all nicotine-dependent persons, their heirs, spouses, and estates (suing tobacco companies). No. Predominance and superiority requirements of 23(b)(3) need to be considered (variations in state law). This is an immature tort, class action is not a proper method of adjudicating here. Familiar Issues in a New ContextNotice, Appeals, and Other Useful Information23(c)(2) – Notice. For 23(b)(1) and 23(b)(2), notice is discretionary. For 23(b)(3), notice is required and must give opportunity to opt out. The cost of notice must be borne by the party seeking to certify the class (Eisen v. Carlisle & Jacquelin 1974)23(f) – interlocutory appeal of class certification is allowed (because it’s so important)23(e) – judge must approve any decision to settle, dismiss, or compromise a class action23(g) - adequacy of the counsel (should be knowledgeable, experienced)23(h) – judge can award a reasonable attorney’s fee, out of the P’s fund or separatelyHansberry (1940): If you are a member of a class, you can be precluded from bringing the same claim in future litigation based on the decision of the class action. But you can collaterally attack a preclusion argument by showing you were not adequately represented in the first class action.Subject Matter JurisdictionFederal SMJ can be based on FQ or diversity.Diversity + AIC: look at the citizenship of the named parties (Ben-Hur v. Cauble 1921). AIC: previously, each party had to individually meet the AIC requirement (see Snyder v. Harris 1969 and Zahn v. International Paper 1973). But then, Congress enacted §1367. S.Ct. said in Exxon Mobil (2005), that a P with an insufficient AIC can use supplemental jurisdiction §1367 to latch onto a P with an adequate AIC. Same for class actions. CAFA 2005 – allows for some minimal diversity and aggregation ($5M)Personal Jurisdiction and Horizontal Choice of LawPhillips Petroleum v. Shutts (1985): A court still must have personal jurisdiction over the D, PJ over the absent class members is achieved by giving them notice and an opportunity to be heard, including an opportunity to opt out (even if the absent class members do not have minimum contacts with the forum state- that requirement is for Ds). Horizontal choice of law (which state’s law to apply): (Shutts) For a State’s substantive law to be selected in a constitutionally permissible manner, that State must have a significant contact or significant aggregation of contacts, creating state interests, such that choice of its law is neither arbitrary nor fundamentally unfair. VenueOnly residences of the class representatives are relevant in determining venue.Erie and vertical choice of law issuesShady Grove v. Allstate Insurance Co. (2010): FRCP 23 allows the case to proceed as a class action, but NY statute prevents this group from being a class action. Whose law to apply? Hanna analysis- is FRCP 23 valid and applicable? Yes. So enforce the FRCP. Applicable- direct conflict. Rule 23 unambiguously authorizes any P in any federal civil proceeding to maintain a class action if the Rule’s prerequisites are met. Valid- does it fall within the statutory authorization (Rules Enabling Act) which says that the Court may promulgate rules of procedure with the limitation that those rules “shall not abridge, enlarge, or modify any substantive right” aka does it “really regulate procedure” (Sibbach, Hanna). Yes. It governs only “the manner and means” by which litigants’ rights are enforced (the rule only alter how Ps claims are processed). Dissent (Ginsburg+3): There is no conflict between FRCP 23 and the NY Civil Procedure: Alternatives and CritiqueCritique2 critiques: 1) The assumptions that make the adversarial system ideal are rarely, if ever, met. All sides do not have equally balanced resources, access to zealous representations, and relevant information. The decision maker is often not free of bias or undue influence. 2) Attack on the theoretical efficacy of the adversary system at its core- because truths are multiple, “truth-finding” is not a viable goal. Deny, attorney/judge focused instead of litigant focused Alternatives (ADR)Questions to consider: Who resolves the dispute? What is the source of the standard of resolution? Who speaks for the disputants? What is the nature and extent of fact-finding and standard-finding? Who decides the dispute? What is the binding effect of any resolution?Fit the forum to the fuss. Examples: negotiation, mediation, neutral factfinding and ombudspersons, early neutral evaluation, mini-trials, summary jury trial, arbitration, private judging. Critique of the AlternativesComplicated process of ADR can lead to the same problems as regular adversarial adjudication. Should everyone get a lawyer for free? Should everyone get the same quality lawyer? Scarcity – how to distribute legal aid services? ................
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