1 Civil Procedure Outline Keyed to Yeazell (7th Edition) I. Jurisdiction: Introduction 1.

*Jurisdiction defined: legal term for where, i.e., which court a lawsuit may be permissibly filed. Also, power of a court to hear a case. 2. *Jurisdictional facts: facts that determine jurisdiction; info a court must have in order to determine whether it has competency to properly adjudicate the issue and render a binding judgment. (e.g. where parties reside, subject matter) 3. Venue: where in the state a lawsuit may be brought. (e.g. Eastern district) 4. General jurisdiction: (State court): open to all claims; state courts can hear any claim a federal court can hear except for particular cases limited to federal court by statutes 5. Limited jurisdiction: (Federal court): can only hear some claims A. Court systems a. State: each state has its own, many have specialized courts also (e.g. family court) i. Typical structure: trialappellatecourt of last resort ii. 10th Amendment: constrains federal govt from interfering with state courts. Each state is sovereign and other states cant interfere. iii. Litigation begun in state courts will typically stay in state court b. Federal i. Supreme Court11 circuits (contains Court of Appeals) districts (divide regions further by geography) c. Why choose federal or state court? i. Docket congestion, jury pools, substantive law applicable in case ii. Determining factor: plaintiff must choose venue that has valid jurisdiction. Otherwise, court will dismiss because it cant render a binding judgment without jurisdiction (goal of court: render binding judgments) d. Limits on federal court power i. Constitution 1. Article III a. Section 1: establishes Supreme Ct, federal cts. b. Section 2: limits power of courts to adjudication of 11 categories ii. Statutory limitations set by Congress 1. Congress can curtail Article III powers of fed courts B. Types of jurisdiction court must have to adjudicate case i. Personal (PJ) ii. Subject Matter (SMJ)

2 1. Court must have jurisdiction over the parties (PJ) and the subject matter (SMJ) to render binding judgment C. Constitutional constraints on personal jurisdiction over a defendant (only D is relevant, P brings self under jurisdiction of the court by filing) a. 14th AmendmentDue Process Clause: restricts state courts i. nor shall any state deprive any person of life, liberty, or property without due process of law. ii. Protect nonresident D from suffering unreasonably from Ps choice of forum iii. Does not apply to Fed courts b. 5th AmendmentDue Process Clause: restricts fed courts with similar language as 14th Amendment D. Full Faith and Credit Clause a. States must recognize and enforce judgments of other states. But only if state rendering judgment has proper jurisdiction to do so. i. (Must have PJ and SMJ) Personal jurisdiction Analysis: (1) long arm statute (2) Shoe (long arm statute must be constitutional; due process limitations) In order to exercise jurisdiction over a defendant, a forum state must either have (1) power or (2) consent. The discussion of power begins with Pennoyer. II. Personal Jurisdiction: Pennoyer v. Neff Ruling in Pennoyer: Oregon courts did not have in personam, or personal jurisdiction over Neff because: 1. Neff was not a resident of Oregon 2. He was not served in Oregon 3. He made no voluntary appearance B. Three types of personal jurisdiction under Pennoyer v. Neff a. In personam: personal; jurisdiction over the person; ability to adjudicate personal obligations (tort/contract claims) i. Residence in state ii. Service of process in the state iii. Voluntary appearance 1. Requirements for asserting personal jurisdiction focused on land and territory. Persons within the boundaries of the state are subject to jurisdiction. b. In rem: focusing on particular item or property located in forum i. Court has jurisdiction over all the world in relation to the property located within the boundaries of the forum

3 ii. Concerns property; involved attachment of property by court at beginning of suit iii. Resolve questions of ownership and control of property iv. In rem still affects persons; distinction is a bit artificial c. Quasi in rem: related to particular property, but not directly concerned with property; property must be attached at beginning of suit to subject nonresident defendant to jurisdiction. i. Adjudicate personal obligations, but jurisdiction operates on property located within the forum and not on the person of the defendants. ii. Property is attached for the purpose of satisfying a possible judgment iii. Judgments bind the parties only in reference to their interests in the res, the property upon which jurisdiction is based. The value of quasi in rem judgment cant exceed value of the property. iv. [LATER: Shaffer v. Hetiner says that quasi in rem must meet the standards regulating personal jurisdiction, thereby practically getting rid of quasi in rem.] d. A judgment in rem or quasi in rem only authorizes liquidation or alteration of the legal status of the property underpinning jurisdiction III. Personal jurisdiction shifts: International Shoe Co. v. Washington Spectrum of International Shoe: specific and general jurisdiction 1. If D has no contacts with state: no personal jurisdiction unless D consents 2. General personal jurisdiction for domiciled individuals, corporations incorporated in the state, or that have their principal place of business in the state, and for individuals or corporations that have systematic and continuous contact with the state. 3. Casual or isolated acts not enough for general personal jurisdiction, but could be grounds for specific jurisdiction, if they are of a nature and quality such that they support specific jurisdiction, that is, jurisdiction over claims arising out of that single act. a. specific: arising out of the Ds contacts with the forum state b. Starting with International Shoe, court begins to define the minimum contacts and fairness required for specific personal jurisdiction The court ruled that the activities undertaken by International Shoe in the state of Washington, brought it under the jurisdiction under the state court. It overruled Pennoyer and instituted a new test for personal jurisdiction. The Shoe test involves two elements: A. Minimum contacts: a. Evaluate the nature and quality of the contacts based on the intersection of contacts, litigation and the forum state

4 b. Extent of activities: continuous and systematic? Or casual, single and isolated? B. Fairness a. Assertion of personal jurisdiction must not offend traditional notions of fair play and substantial justice Presence in the state under Shoe extends beyond territorial presence of Pennoyer. Clause from Shoe: defendant had certain minimum contacts with forum state such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice. (Other ways for state to assert personal jurisdiction in addition to consent (implied and explicit), and waiver) IV. McGee v. International Life Insurance (S.C. CA, 1957), furthering Shoe Established beyond question the forums authority to assert jurisdiction over nonresident defendants in lawsuits arising from their forum-directed activities (If those activities meet minimum contacts.) A. Met minimum contacts requirement because the TX corporations contacts with CA were more than isolated or single and gave rise to the litigation. (Intersection of contacts, litigation and forum) B. Texas corporation purposefully availed itself of the benefits of the state by soliciting business of Lowell Franklin, and conducting business with him via mail in CA. V. Hanson v. Denckla (1958) furthering Shoe test Defendant must purposefully avail itself of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of its laws. --Defendant (DE trustee) did not purposefully avail himself of the benefits of the forum; therefore, there were no minimum contacts. --If no min. contacts, dont need to go to fairness prong. VI. Harris v. Balk Under Pennoyer, the presence of property in the forum state could be the basis of jurisdiction over claims of any sort (language not from case) (p. 85) Under Pennoyer, a MD court attached the debt of Harris (nonresident) while he was in MD, and asserted quasi in rem over him in order to adjudicate a claim brought by Epstein. Quasi in rem was used to bring defendants under jurisdiction to adjudicate claims not related to the property attached, until Shaffer. VII. Shaffer v. Heitner (1977) (Greyhound/Delaware) We conclude that all assertions of state court jurisdiction must be evaluated according to the standards set forth in International Shoe and its progeny (90).

5 A. This statement is precedent for quasi in rem, because the case was about Delawares assertion of quasi in rem jurisdiction over the officers of Greyhound, based on the statutory decree that their stocks in Greyhound were located in DE. In essence, quasi in rem is gone. No advantage to using it anymore a. Court said that even if debtor leaves state to avoid debts, plaintiff can get in personam in another state under Full Faith and Credit Clause. B. This statement is considered dicta for in rem because the Shaffer case was not about property. C. DEBATE: does Shaffer require the application of the Shoe test to in rem jurisdiction? a. Minority: Yes: Jurisdiction over property necessarily means jurisdiction over persons, since the courts decisions affect the lives an fortunes of people involved with the property. b. Majority: No: Minimum contacts wont affect in rem because claims in rem are about the property. Also, Shaffer was not about in rem, but only quasi in rem. BIG PICTURE International Shoe represents the courts attempt to restrain the states from violating a defendants right to due process (14th amendment). BIG PICTURE: battle between states who want to assert jurisdiction and the Constitution that aims to protect defendants from being deprived of their life, liberty, or property without the due process of law. Shoe test used to push back against long-arm statutes. General jurisdiction: testsubstantial contacts with state -Allows plaintiffs to bring cases against defendants in state where activity did not occur; claims can be brought against D for activities outside of state for things not related to activities in state; no connection between in-state activities and claims needed. Example: Microsoftsubject to general jurisdiction in most states Test for general jurisdiction: For corporation: state of incorporation, state where primary business located For individuals: domicile If defendant falls short of general jurisdiction, then court tests for specific jurisdiction using Shoe test of minimum contacts and fairness. *Specific used for nonresidents only Specific jurisdiction is exercised either in: in personam or in rem. BUT debate whether Shaffer got rid of in rem/in personam distinction and tests ALL personal jurisdiction using the Shoe test of minimum contacts and fairness. To gain personal jurisdiction over a defendant:

6 1. Decide if court has general jurisdiction Ycourt can render binding judgment Ntest for specific jurisdiction using Shoe test *look at long arm statute and see to what extent PJ allowed; if its allowed to the fullest extent under the Constitution, then apply Shoe test 2. Shoe testminimum contacts/fairness 3. DEBATE: agreed in Shaffer v. Heitner that Shoe test applies to in personam and quasi in rem. But does it also apply to in rem? Majority: no Always focus on D when applying Shoe test.

VIII. World Wide Volkswagen v. Woodson (U.S. Supreme Court, 1980) (Auto accident in OK, victims sued in OK courts; defendants contested personal jurisdiction) A. The idea of fairness of the Shoe test is further developed by WWVW: -Court considers the following in determining fairness: 1. Interest of forum state; why would court want to hear? 2. Location of witnesses 3. Defendants interest: is it fair to D? Undue burden? 4. Plaintiffs interest: covenant and effective relief? 5. Judicial systems interest in obtaining effective resolution of the suit 6. Public policy interest B. Unilateral actions of plaintiff cant bring defendant under personal jurisdiction of the forum state because the defendant is not availing himself of the benefits of the forum state. (See Hanson v. Denckla). Car dealer did not inject the car into OK, but rather, the plaintiff took the car there. Ds actions must show that he purposefully availed himself of the forums benefits and protection. *Ds contacts are what matter under due process clause. C. Foreseeability argument: Could D have foreseen that he would be liable to cases arising out of the forum state? In WWVW v. Woodson, the court determined that foreseeability alone is insufficient under the due process clause to establish personal jurisdiction. Must have minimum contacts and fairness. Even if the car dealer could foresee that the plaintiff would take the car to OK, this is not enough to subject him to personal jurisdiction in OK. D. Motorist Statutes: Court has jurisdiction over nonresident drivers, on the grounds that they are availing themselves of the benefits of the state

7 by using the states roadways. This is not applicable in WWVW because the defendant was not a motorist on OKs roads. Yet, Justice Brennan, in his dissent, argued that the court did not take account of the states interest in protecting its highways. IX. Asahi Metal Industry Co. v. Superior Court (U.S. Supreme Court, 1987) A. Decided by S.C. on the issue of fairness; disagreement on issue of minimum contacts. B. Fairness a. Burden on D i. Significant: foreign corp. b. Interests of forum state i. None: neither party is resident c. Ps interest in relief C. Minimum Contacts a. Two theories for min contacts: intent v. mere awareness i. (1) OConnor (Section IIA) 1. Purposeful availment requires intent or purpose to serve forum state. a. Intent test: i. Designed product for use in area ii. Marketed to forum iii. Have a channel of communication to customers iv. Sales agent in the area 2. Mere awareness that product placed in stream of commerce will end up in the forum state is not enough for minimum contacts 3. Intent to serve forum state + Injection of goods into stream of commerce + awareness that product will be in forum state = minimum contacts ii. Brennans theory 1. Awareness that product will be in forum state is sufficient; no intent to serve forum state is necessary for D to be subject to jurisdiction 2. injecting goods into a stream of commerce should suffice to support jurisdiction 3. D getting economic benefit from CA marketthis is enough for jurisdiction 4. Awareness + injection of goods into stream of commerce = minimum contacts *Asahi: the only case decided on fairness prong; debate on min contacts X. Burger King Corp. v. Rudzewicz (U.S. Supreme Court, 1985)

8 A. Fair warning requirement is met if the defendant has purposefully directed his activities to the state. The defendant had fair warning that he might face litigation in the forum. Even though contract was signed and filed in forum state, D must still have minimum contacts with the state (the contract is included in the min contact calculation) and fairness. B. Florida has specific jurisdiction over the defendant because he reached beyond Michigan. Minimum contacts met because: a. He purposefully availed himself of the benefits of doing business in FL i. Negotiated in FL with FL corp. ii. Negotiation directed towards FL corp. iii. Contemplated consequences of contract: liability to FL corp. b. Fairness (WWVW) i. States interest in finding solution ii. Burden on D iii. Interstate judicial systems interest in resolution iv. Public policy v. Location of witnesses c. Random contacts arent enough for PJ under Shoe; unilateral activities on part of plaintiff or 3rd party doesnt satisfy minimum contacts, must have purposeful availment

XI. Pavlovich v. Superior Court: D may be subject to specific jurisdiction even for actions outside of state A. (1) step: long-arm statute: fullest extend allowed under the Constitution B. Effects test: Calder v. Jones a. A court may have PJ if the forum state experiences the effects of an out of state action b. Sliding scale of internet cases i. Doing business onlineinteractive websitesmake info available (passive) ii. Pavlovich: fits into the passive category c. Court: no PJ because: i. Pavlovich did not particularly target plaintiff ii. No purposeful availment of benfits of CA. d. Dissent i. expressly aimed at CA because movie industry/Silicon Valley in CA; general knowledge that they will be affected by his actions is enough contact with the state for PJ.

Shoe test: (1) Minimum contacts; nature and quality: a. Purposeful availment of the benefits and protections of the forum state (Hanson v. Denckla, motorist statute) b. Forum-directed activities (McGee) c. Reached beyond and into fair warning of litigation in forum state (Burger King) d. Forseeability not enough (WWVW) e. Stream of commerce i. Asahi 1. OConnor a. Minimum contacts = intent to serve forum state + injection of goods into stream of commerce + awareness that product will be in forum state 2. Brennan a. Minimum contacts = injection of goods into stream of commerce + awareness that product will be in forum state f. Effects test: for activities outside of state i. Sliding scale of internet cases (2) Fairness a. BK/WWVW i. Burden on D ii. Forum states interest in adjudication iii. Ps interest iv. Interstate judicial systems interest in adjudication v. Procedural and substantive interests of other nations b. Asahi: only case decided on fairness General Jurisdiction (up to now, only discussing specific jurisdiction, claims arising out of contacts with the state) A. General jurisdiction allows court to hear any claim about a defendant B. Gained: a. Over person: domicile (intent to stay) b. Over corporation: state of incorporation, principal place of business c. Defendant must have substantial contacts with the state I. Perkins v. Benguet (U.S. Supreme Court, 1952)

A. Nonresident suing alien corporation for claim arising from activities outside the state: needs general jurisdiction B. High standard for general jurisdiction, since court can hear any claim.

10 a. Must show its principal place of business: substantial contacts II. Helicopteros Nacionales de Columbia v. Hall (US Supreme Court, 1983)

A. Alien corp. sued in TX for injury in Peru. a. Helicol must have systematic and continuous contacts with TX to be subject to general jurisdiction in TX B. Contacts a. Negotiated contract in Houston b. Bought 80% fleet from Ft Worth company c. Sent pilots to Ft Worth for training d. Received bank payments in TX i. NOT ENOUGH FOR GENERAL JURISDICTION III. Burnham v. Superior Court

A. Burnham, a NJ resident, was served in CA B. Pennoyer is not dead: still in the game regarding service of process in the state. a. If defendant is served while physically present in the state, he is subject to general jurisdiction in that state. b. Dont need minimum contacts if nonresident defendant is in the state. Shoe test only required when nonresident D is outside of the state and the court wants to bring him into the state to defend claim IV. OConnor v. Sandy Lane

A. Did claim arise out of in-state activities (specific jurisdiction needed) or out of continuous and systematic activities in the state (general jurisdiction needed) a. Court found that it did not have general jurisdiction over Sandy Lane because the corporation did not carry on continuous and systematic contacts with the state. b. However, they have specific jurisdiction because: i. Sandy Lane purposefully availed itself of the benefits and protections of PA 1. Advertising, website, toll free number, mailers ii. Ps claim arises out of contacts with PA 1. Approaches to determine if Ps claim arises out of Ds contacts with state (Is there a sufficient connection

11 between Ps claim and contacts to support specific jurisdiction?) a. (1) proximate cause/substantive relevance test; contacts must be substantively related to cause of action in order to confer personal jurisdiction b. (2) but for (adopted in this case) c. (3) substantial connection i. case by case determination iii. Court found that but for the brochures sent to the OConnors, the injury would not have happened. Therefore, specific jurisdiction established and minimum contacts applied B. Due process requires reasonable forum; not best or most convenient if claim arises out of contacts with forum state Consent as substitute for power Consent is expressly or impliedly given 1. Implied consent, according to Supreme Court a. Nonresident motorist statute i. Nonresident driver who uses states roads, impliedly consenting to PJ in state (Hess v. Pulowski, 1929) b. Sales of securities i. (Dorrity v. Goodman, 1935): nonresident defendant selling securities in forum state for claims arising out of those sales c. Activities after commencement of action i. Waiver of consent by failure to object 1. Failure to object to states PJ ii. Waiver of consent by failure to comply with discovery requests for jurisdictional facts iii. Ds general appearance 1. Only appear to object to jurisdiction; dont bring up objections to claim iv. Non resident plaintiffs and counter claims 1. If P brings claim in other state, consent to PJif counterclaim brought by D 2. Express Consent a. Show up in court b. Appointment of instate agent

12 i. As condition for doing business in state, many states require corporations to appoint agents in states (Supreme Court has upheld these statutes) c. Forum selection clauses i. Parties may contractually consent to have disputes litigated in particular forum via forum selection clauses ii. Parties specify which forum they will be subject to; most courts upheld these clauses, but they are subject to contract defenses of unconsciousability or duress 1. Cant contractually agree to subject-matter jurisdiction; only personal jurisdiction d. Cognivot clauses i. In a loan agreement, debtor consents to personal jurisdiction and waives service of process and notice ii. Supreme Court: such clauses dont violate due process, but are subject to contract defenses as above (duress etc) Carnival Cruise Lines v. Shute

I.

A. Express forum-selection clause a. Court enforces the clause; P had notice, on ticket; interest of cruise line, dispels confusion of where to file, convenience; lower fares for passengers B. Forum-selection clauses are valid only if (1) (made?) under reasonable circumstances and (2) fundamentally fair (as determined by court) a. Questions to keep in mind on exam i. Bad faith on the part of the defendant? ii. Did P have notice of the clause? iii. Are there benefits for P under the clause? iv. Are there benefits for D under the clause? 1. Fairness A. Defendant must have notice a. Service of process on nonresident while present in state (Burnham) B. Two steps for service of process a. (1: Statutory) Determine if rule or statute gives method for service of process Notice

13 1. file complaint in appropriate court (this doesnt commence suit; must give D notice to respond) 2. Issuance of summons by court (service of process begins) 3. Service of process i. Federal rules: 4(e)(1) allows federal court to follow state law methods For example, in FL, service of process on spouses living in same home is allowed, except if the dispute is between the spouses. Also, in FL, may deliver process to mailbox. 4(e)(2) (p15): 3 methods for service of process 1. Personal service: basic; service on person individually, or agent/officer of corporation 2. Substantive service: service at Ds dwelling or usual place of abode with person of suitable age and discretion (in FL=15 yrs of age) If person doesnt deliver to D, out of luck. 3. Service on the agent: service authorized by statute or appointment 4(f): serving individual in a foreign country 4(g): serving minor or incompetent 4(h) Service to corporations -within the US: (A) in the manner prescribed in 4(e)(1) for serving an individual; (B) delivering a copy of the summons and complaint to agent, officer; and also by mailing copies of each to the D -outside US: any manner set out in 4(f), except for personal delivery (mail or other means allowed by international agreement; follow countrys rules as to service) 4(m) Time limit for service If D not served within 120 days after the complaint is filed, the court must dismiss without prejudice, or order that service be made within a specified time. But if the P shows good cause for the failure, the court must extend the time for service for an appropriate period. (Does not apply to service in a foreign country). 4(l): Proving service Unless service is waived, proof of service must be made to the court. Except when service made by US marshal or deputy marshal, proof made by servers affidavit. 4(d): Waiver of service P may inform D of lawsuit and request that D waive service to avoid cost. Notice and request must be in

14 -writing, -addressed to defendant or agent; -name of court; -include a copy of the complaint and -two copies of a waiver form, -a prepaid means of returning the form, -notice of which court the claim is filed. -Date sent Must be send first class mail or other reliable means. Must give D at least 30 days after request sent to respond; or at least 60 days if D outside US. Answer If they waive, get to answer complaint within 60 days if in the country; or 90 if outside US. -Failure to waive results in liability for costs of service; 21 days to answer b. (2: Constitutional inquiry: Mullane Test) Assess whether rule or statute applied in the specific case meets the requirement of due process; does it allow the defendant to respond? i. Mullane v. Central Bank and Trust Co. 1. Banks failure to notify beneficiaries violates the due process clause a. Beneficiaries are liable to lose property (money) if they do not respond to claim. They need notice of the litigation. 2. Proper Notice (**take away point) a. Awareness is not enough; actual notice is not enough i. Mullane test: Notice must be fair: reasonably calculated to allow defendant to respond ii. Constitutionally proper notice =fair notice iii. Questions to ask 1. How effective was notice? 2. Burden of the notice 3. State interest in the notice 4. What are the alternatives? (e.g. mail is alternative to personal process) 3. Contesting improper service of process a. Time: didnt have proper time to respond Long-Arm Statutes *International Shoe sets boundaries, but states decide how close they want to get to that boundary

15 Two types of long arm statutes 1. General: go all the way to the limit allowed under International Shoe (e.g. CA, PA) 2. Some have specific instances prescribed by enumerated statute. (e.g. FL: breach of con tract) Federal courts -want to exert personal jurisdiction over nonresident Rule 4(k) governs personal jurisdiction by federal courts (1)(a) D located within federal district is subject to PJ by federal court if it meets the standard of the long arm statute (1)(b) Bulge rule: Federal Court exerts PJ over certain Ds located within 100 miles of courthouse, even if in other state -3rd party claims; cross-claim action; impleader (eg. Asahi); does not apply to original defender (1)(c) Federal court may exert PJ over D if authorized by federal statute (e.g. Federal Impleader Act) 4(k)(2) Federal Long-arm statute -federal jurisdiction possible over federal question claims if non resident D has insufficient contacts to be amendable to process under state long arm statute (no min contacts) but sufficient national contacts to be held under 5th amendment. If D doesnt met long arm statutes of any state, then federal court has PJ. (international cases) Gibbons v. Brown (1998) B. Court interpreting own long-arm statute i. PJ not always allowed under long-arm statute, meaning that court doesnt always get to apply to shoe test. Long-arm statute is the first stop in the analysis ii. Gibbons, a Texas resident, had brought a suit two years earlier in Florida. Brown tried to sue her in Florida. iii. Under FLs long-arm statute, the defendant must have substantial activities in the state, whether or not they are related to the suit. This is stricter than Shoe 1. The court ruled that Gibbons did not have substantial contacts Venue

A. Where case can be filed a. Choice of forum is determined by three things: i. Subject matter jurisdiction

16 ii. Personal jurisdiction iii. Venue rules 1. Statutory authority, not constitutional issue 2. Identifies more precisely in which court claim may be brought 3. Bring suit into the state because of personal jurisdiction, then narrow the field further through venue rules. B. Federal venue rules a. General Federal venue rules: 28 USC 1391 i. 1st question: (a) or (b)? ii. USC 1391(a): for diversity cases (a) A civil action wherein jurisdiction is founded only on diversity of citizenship may, except as otherwise provided by law, be brought only in (1) a judicial district where any defendant resides, if all defendants reside in the same State, (2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated, or (3) a judicial district in which any defendant is subject to personal jurisdiction at the time the action is commenced, if there is no district in which the action may otherwise be brought. iii. USC 1391(b): federal question cases (b) A civil action wherein jurisdiction is not founded solely on diversity of citizenship may, except as otherwise provided by law, be brought only in (1) a judicial district where any defendant resides, if all defendants reside in the same State, (2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated, or (3) a judicial district in which any defendant may be found, if there is no district in which the action may otherwise be brought. USC 1391(c ): for corporations: citizen in any district where it is subject to PJ at time action commenced (for purpose of venue) USC 1391(d): if defendant is an alien, may be sued anywhere But cant use alien can be sued anywhere idea to bring suit against all Ds under 1391(a)(3) or (b)(3)

17

C. Challenges to venue in federal cases (under USC 1391) a. Rule 12(b)(3) (of Federal Rules of Civ Pro) motion: current venue is improper b. Challenge venue in answer to pleading i. Otherwise, under 12(h)(1), the D waives objection, and consent is implied 1. 12(h)(1): failure to make a motion under rule 12 or to include objection in responsive pleading amounts to implied consent. c. Defendant may also make a 12(b)(2) motion to challenge personal jurisdiction or a 12(b)(1) motion to challenge subject matter jurisdiction, or challenge PJ or Sub-Matter J in responsive pleading i. Rule 12(g): Defendant is allowed to join motions, so that all objections are dealt with at one time. ii. If no objections made, consent is implied iii. 12(h)(3): lack of SMJ: if the court determines at any time that it lacks SMJ, the court must dismiss the action. SMJ is not waiveable! D. Transfer a. Transfer of venue does not cross the state/federal chasm i. No transfer from state to federal court, or vice versa, except in removal process ii. Transferor court makes the decision to transfer the claim to the transferee court. 1. The party seeking transfer has the burden to show that transfer should occur. b. Transfer made under 28 USC 1404(a): federal courts i. When claim is in proper venue ii. Dismissal is not allowed iii. Only within federal court system; forum non conviens for intl, or state to state iv. Moving party has burden of showing transfer is warranted v. Transfer made in the interest of justice and convenience of parties vi. Court considers same private/public interests as in forum non convienes inquiry vii. Plaintiffs choice is given considerable weight; assumed it was most convenient c. Transfer made under 28 USC 1406(a) i. Claim is in improper venue ii. Dismissal allowed d. Each state court has own version of federal rules 28 USC 1404(a) and 1406(a) concerning transfer e. Prefer to transfer than dismiss in the interest in justice

18 E. Forum non convienes a. Court may dismiss case if venue is not convenient, even if proper i. Different from 1404(a) because 1404(a) does not permit dismissal of properly venued cases ii. Greater showing of incovenience required for forum non convienes. b. Uses i. Move between state court systems ii. Move internationally c. Assume home forum chosen by plaintiff is most convenient forum for plaintiff d. Why would court dismiss? i. Cant transfer 1. State court cant transfer to anothers state court (no FLCA transfer) e. Inquiry for motion to dismiss on forum non conveines (from Piper Aircraft v. Reyno (1981, US Supreme Court): plane crash in Scotland; plane manufacturer in PA, propeller manufacturer in OH; transfer to Middle District of PA, moved to dismiss on grounds of forum non conveines. The test is taken from Gulf Oil Corp v. Gilbert (1947). i. Private factors 1. Ease of access to proof 2. Cost of obtaining witness (both willing and unwilling) 3. View of premises: where it occurred 4. All other considerations that make a case easy, expeditious, and inexpensive ii. Public factors 1. Administrative difficulties flowing from court congestion 2. Local interest in having local controversies decided at home 3. Interest of having a diversity case tried in forum that is well suited to apply the law that must govern the action (Scottish law was involved in Piper) 4. Avoidance of unnecessary problems with conflict of laws, or application of foreign law 5. Unfairness of burdening citizens in an unrelated forum with jury duty. f. Standard of review for forum non conveines i. Lower courts have discretion to determine motions, and the Supreme Court will only review if there is an abuse of discretion g. Piper

19 i. It doesnt matter if alternative forum isnt as favorable to the plaintiff 1. not deciding factor, but might be relevant concern if transferring to alternative court is inadequate for providing a remedy. 2. Court will be less likely to dismiss a case if plaintiff would have no remedy anywhere else h. Flexibility in application i. Court wants flexibility, not a bright line rule with forum non conveines ii. Some courts will require existence of another more convenient forum before they will grant motion of dismissal for f.n.c., others wont iii. Some courts condition dismissal for f.n.c. on defendant waiving objection to PJ in alternative forum Attacks on jurisdiction in Federal Court A. Objection to subject matter jurisdiction: 12(b)(1) B. Objection to personal jurisdiction: Rule 12(b)(2) a. Objection by D to PJ via a 12(b)(2) motion b. In answer, or in response to Ps amended complaint (responsive pleading) C. Other objections a. Improper venue: 12(b)(3) b. Insufficient process: 12(b)(4) i. rare c. Insufficient service of process: 12(b)(5) d. Failure to state a claim upon which relief can be granted: 12(b)(6) e. Failure to join a party under Rule 19: 12(b)(7) D. 12(g)(1): Right to join motions a. Motions under Rule 12 may be joined together in same motion E. 12(g)(2) Limitation on Further motions a. Once a party makes a motion under Rule 12, they may not make another objection or raise a defense that was available to them but they omitted from earlier motion. Subject-Matter Jurisdiction Court must have both personal and subject matter jurisdiction to render a binding judgment. Personal jurisdiction=specific or general Subject matter jurisdiction 1. for federal courts=federal question or diversity

20 2. for state court=statutes set forth substantive claims that may be heard in each court and determining subject matter jurisdiction. Usually state courts can hear anything; though there may be particular courts for particular claims, e.g. for wills, trusts etc. I. U.S. Constitution: Article III a. Section I: establishment of Supreme Court and lower federal courts b. Section II: Judicial power limited to certain types of cases; Congress is not required to allow federal courts to hear all the types of cases allowed by the Constitution. And they currently dont. (greater than $75,000 requirement) II. Most important statutes for federal subject matter jurisdiction a. 28 USC 1331 and 1332: federal question and diversity i. If claim arises under either of these two statutes, then federal court has smj over the claim. b. 1331: Federal Question i. The district courts shall have original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States. (p339 supplement) ii. Federal court has smj when case arises under federal law 1. Constitution 2. Federal statute 3. Treaties iii. Reasons 1. Federal government is better at interpreting federal law than any other court. 2. Avoidance of state hostility: state might interpret federal law to benefit of own citizen iv. To determine if Federal question: 1. Court looks at only the plaintiffs complaint, not the defendants assertion of defenses or defendants filing of counterclaims. Well pleaded complaint rule a. Louisville and Nashville RR v. Mottley i. It was not enough that P alleges that anticipated defense would come under federal law; plaintiffs complaint must be a well-pleaded complaint that shows in the complaint that case falls under federal question 1. Need federal claim, not federal defense (as plaintiff did in Mottley)

21 2. Court will ignore extraneous info: wont look at plaintiffs rebuttal to an anticipated defense. c. 1332: Diversity i. Constitution 1. Article III, Section II: judicial power of US shall extend to controversies between citizens of different states or between state citizens and aliens. ii. 1332 (a) the district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between (1) citizens of different States (2) citizens of a State and citizens or subjects of a foreign state check note 8c on p 194 (3) citizens of different States and in which citizens or subjects of a foreign state are additional parties; and (4) a foreign state, defined in section 1603(a) of this title, as plaintiff and citizens of a State or of different States. iii. Amount in controversy MUST exceed $75,000 iv. Complete diversity 1. Between all plaintiffs and all defendants. No plaintiff from same state as any defendant. Parties on same side of dispute can be from same state. a. Two Ps from CA v. Two Ds from AZ: OK b. One P (CA) and a P (AZ) v. D (NY) and D(CA): not OKP and D from same state (CA); therefore, there is not complete diversity on both sides of the v v. How to determine citizenship 1. Individuals a. Domicile: fixed place of abode coupled with intent to remain there 2. Aliens a. Alien v. Alien: cant be heard b. Under 1332 (a): Alien admitted to US with permanent resident status: deemed citizens of the state, for purposes of diversity jurisdiction, where alien is domiciled i. Applies only to cases where a state citizen is involved in suit with permanent resident alien; allows state court to hear this case

22 ii. Does not apply to litigation between alien and permanent resident alien (Saadeh v. Farouki) c. Aliens, not US citizens in residence in another country (Redner v. Sanders: P, a US citizen tried to claim diversity jurisdiction under 1332(a)(2) since he lived in France; no good. Failed under (a)(1) also, since he couldnt prove domicile in USsame thing happened to Liz Taylor when she was sued when living in Europe, on a claim related to the movie Cleopatra) 3. Foreign states a. 1332(a)(4)defined 1603(a) i. Foreign states to include political subdivisions of states, government agencies, or instrumentalities of the state 4. Corporation a. 1332(c )(1) i. Corp has dual citizenship: deemed citizen of: 1. Any state by which it has been incorporated 2. Any place the corporation has principal place of business a. Only has one place of business: TEST for principal place of business in White v. Hallston i. Nerve center: focus on corps decision making authority and overall control ii. Corporate activities: focus on location of production or services and activities iii. Total activities: all activities considered, including where decisions are made 5. Partnership (e.g. LLP) a. Not viewed as single legal entity for purposes of diversity. Citizenship of each and every member

23 of the partnership must be considered in determining diversity jurisdiction 6. Unincorporated association (LLC) a. Treated like partnershipsnot treated as single entity 7. Legal representatives of an estate (1332 (c)(2) a. Decedents citizenship is what matters, not the representative 8. Legal representatives of infants/incompetents a. Citizenship of the infant or incompentent is what matters d. Amount in controversy must exceed $75,000 i. Ps ultimate recovery is irrelevant: if P recovers less than $75,000, it does not affect jurisdiction. 1. However, under 1332(b), if P recovers less than $75,000, the court may deny recovery by the plaintiff and even require P to pay Ds court costs. a. Meant to deter P inflating allegations to have suit in federal court ii. Ps good faith allegation that jurisdictional amount is satisfied unless D can prove with legal certainty that claim is less than $75,000 iii. Class Action cases 1. each class members claim in a federal class action suit must meet the jurisdictional amount in controversy requirement iv. Aggregation 1. P can aggregate: a. Single P with multiple claims arising from the same event, against a single defendant. b. Single P with multiple claims that are unrelated, against a single D. Even though unrelated, claims may be aggregated if arising from same event i. Rule: single P may aggregate multiple claims against single D, even if unrelated, but arising from same event or transaction. 2. Plaintiff cannot aggregate: a. Single P cannot aggregate claims against multiple Ds, even if arising out of single event b. Multiple Ps cannot aggregate claims against single D

24 i. Exception: if claims are joint or common interest (e.g. joint tenancy) Supplemental Jurisdiction A. In 1990, Congress enacted USC 1367 which governs all assertions of supplemental jurisdiction. a. 1367(a): in any civil action of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the U.S. Constitution. Such supplemental jurisdiction shall include claims that involve the joinder or intervention of additional parties. b. 1367(b): In any civil action of which the district courts have original jurisdiction founded solely on section 1332 of this title [diversity], the district courts shall not have supplemental jurisdiction under subsection (a) [diversity] over claims by plaintiffs against persons made under Rule 14, 19, 20, or 24 of the Federal Rules i. if original jurisdiction is based on diversity, no supplemental jurisdiction over claims that destroy diversity by means of the Rules that are invoked to join parties. c. 1367(c): The district courts may decline to exercise supplemental jurisdiction over a claim under subsection (a) if: (1) the claim raises a novel or complex issue of State law a. See Szendrey-Ramos v. First Bancorp (involved Canon 21 of the Puerto Rico Code of Professional Ethics and would require plaintiff to divulge info, violating this rule. But the court in PR have never ruled whether a lawyer may divulge info if she is suing a client) (2) the claim substantially predominates over the claim or claims over which the district court has original jurisdiction a. See Szendrey-Ramos v. First Bancorp: state claims mimic federal, but go beyond and require different standard of proof. (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. B. Allows federal courts in its discretion to add parties to a dispute who would otherwise not have a valid jurisdictional basis to be in federal court; or to add claim that lacks independent federal jurisdictional basis.

25 a. Never available to get the original case in federal court; only available to add additional state claims. i. At least one claim must be in federal court on own merits (either diversity or federal Q). ii. Supplemental jurisdiction is not needed if independent basis for subject matter jurisdiction over the claim C. In re Ameriquest a. A loose factual connection between state and federal claims is sufficient to confer supplemental jurisdiction as long as the facts are common and operative. i. Plaintiff, Barbara Skanes, wants a rescission of her mortgage and statutory damages, alleging that Ameriquest defrauded her. She brings a Truth in Lending Act (TILA) claim which was heard in federal court (federal question) and because there was sufficient connection with her state law fraud claims, these charges were brought in federal court too, under supplemental jurisdiction. Removal A. Ability of D to move or shift a cause that P filed in state court, to a federal district court. B. Only civil claims over which district federal court would have original jurisdiction can be moved (federal Q or diversity) C. 28 USC 1441(a) (p. 359) Except as otherwise expressly provided by Act of Congress, any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending. For purposes of removal under this chapter, the citizenship of defendants sued under fictitious names shall be disregarded. 1441(b): if removal is based on federal question, claim is removable. Period. Diversity cases are more tricky Any civil action of which the district courts have original jurisdiction founded on a claim or right arising under the Constitution, treaties or laws of the U.S. shall be removable without regard to the citizenship or residence of the parties. Any other such action shall be removable only if none of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought. -For diversity cases, if any defendant is a citizen of forum state, then no removal

26 1441(c): if state law claim added to federal claim under 1331, (and therefore there is supplemental jurisdiction), entire case (state claims) may still be removed to federal court at discretion of court D. Removal is only from state court to federal court; not state to state, or federal to state E. Only nonresident D may remove F. No reverse removal right G. How does case get back to state court? Dismissal for lack of SMJ or PJ (12(b)(1) or (2)) H. If Plaintiff has possible federal claim, but does not assert it, defendant may not remove based on this unasserted claim a. Similar to the well-pleaded complaint rule I. Diversity removal a. D may remove only if none of the Ds are in-state citizens b. Removal only for out of state Ds i. Diversity removal meant to protect out of state citizens. c. Catepillar, Inc. v. Lewis, 519 U.S. 61 (1996) i. As long as the court has SMJ at time of judgment, its ok that at the time of filing, removal was improper ii. Catepillar filed a notice of removal to federal court on the grounds of diversity after Lewis, a KY resident, settled with Whayne Supply Co., a KY corporation. Though the settlement was not finalized at the time of filing, Catepillar needed to file in time before the 1 year deadline, so it did so in anticipation of the settlement. After the case was removed, and by the time judgment was rendered by the federal court, the settlement was complete, giving rise to diversity and making removal proper. 1442(a): rule for armed forces 1446(b): notice of removal within 30 days of receiving state court complaints J. Non-removable cases: 1445 a. Four types: i. Involving railroad ii. Involving common carriers for less than $10,000 iii. State workers comp proceedings iv. 403 Violence Against Women Act K. How does P challenge removal? a. 1447(c) i. Once D files notice of removal, P has 30 days to file motion of remand ii. Diversity: have 1 year limit

27 Choice of Law: Erie Problem I. Erie: vertical choice of law problem a. P and D are citizens of different states, and under diversity, suit ends up in federal court. Which law applies? Federal or state? b. Not dealing with horizontal choice of law problem (which state) c. Federal court: i. If Federal question, then federal law applies ii. If diversity, federal courts apply state substantive law. Problem arises in regards to procedural laws. Starting point: Rules of Decision Act, (1789) 28 USC 1652 a. The laws of the several states, except where the Constitution or treaties of the Unites States or Acts of Congress otherwise requires or provide, shall be regarded as rules of decision in civil actions in the courts of the United States, in cases where they apply. (p. 366) i. NOTE: Erie only dealing with diversity What is the meaning of laws? 1. Swift v. Tyson(1841) a. In federal court in NY under diversity b. NY state courts (case law) adhered to rule that discharge of debt was not consideration c. But Justice Joseph Story (US S.C.), in an opinion for the Supreme Court wrote that the court need not follow this rule because the word laws in the RDA refers only to statutes or common law property rules, and not case law generated by state judges. 2. Swift: laws = statutes and common law property rules 3. Under Swift, judge can make independent judgments as to what the proper rule should be on issues of general common law. Judge could be influenced by c/l of the state and of other states 4. Good law for 100 years, until Erie Erie Railroad v. Tompkins (1938) a. Tompkins loses arm after being hit by open door on passing railcar. Sues in federal court under diversity. PA case law uses standard of gross negligence, while federal law employs ordinary negligence. The lower courts, following Swift, found in favor of Tompkins, using the standard of ordinary negligence (federal). Erie RR appealed, and the Supreme Court overruled Swift b. Erie: i. (1) Swift is an incorrect interpretation of RDA 1652 1. Court looks to Charles Warrens Harvard L. Review article to find that Congress intended to include both written and unwritten law in RDA

II.

III.

IV.

28 ii. (2) Swift failed because it did not create the expected uniformity 1. No general, uniform, national common law: federal courts have own common law iii. (3) Swift created discrimination 1. Erie RR wanted federal court to applyforum shopping; 2. Out of state D could game the system by choosing federal or state court depending on the law applied in each iv. (4) Swift is unconstitutional v. the federal courts exercising jurisdiction in diversity of citizenship cases would apply as their rules of decision the laws of the State, unwritten as well as written. 1. Swift narrowed meaning of state law, giving broader room for application of Federal law. Violates states power by augmenting federal power. Congress has power to rule specific things, but cant supplant whole body of state, then Article I of Constitution (which delineates Congress power) would be rendered meaningless. Congress would have unlimited power. Give them a back door to legislating states interests. vi. Whether the law of the State shall be declared by its Legislature in a statute or by its highest court in a decision is not a matter of federal concern. vii. Laws = case law + statutes c. Erie Take-away: Federal courts must apply the law that would be applied by the courts of the state in which they sit. (1) avoid forum shopping and (2) inequitable application of law. i. In Diversity cases, the Constitution requires that federal courts apply both state statutes and state common and there is no federal common law. Reeds concurrence: the Rules Enabling Act (1934) controls procedural aspect of federal courts. Reed: Erie muddles the water. Reed: how do you distinguish between procedural and substantive laws? Erie: (1) federal courts (2) diversity cases (not federal Q) Question: what laws apply? Rules of Decision Act: Erie interprets laws as state statutes and case law. State laws apply; but what about procedural rules? (Reed) Under supremacy clause, Federal Rules of Procedure preempt state rules PROBLEM EMERGES: what about procedural rules? V. Guaranty Trust Co. v. York (1945)

29 a. Seeks to answer the question raised by Justice Reed in his concurrence in Erie: what about Rules of Procedure? i. Reed: refrained from calling Swift unconstitutional; b. Must consider if the law concerns (1) substantive right or (2) form or mode of enforcing that right (procedural) c. Test: (1) Substantive or Procedural (2) Is the procedural rule outcome determinative, and therefore substantive? *York: If procedural rule is outcome-determinative, apply state law i. Outcome-determinative test to distinguish between procedural and substantive rules ii. From the 1950s onward, courts retreat from this case d. Federal court must apply state statute of limitations, because they determined that a S/L is substantive, because it affects the outcome. i. Problem: every procedural law could be outcome determinative e. Erie applies only substantive laws, not procedural VI. Byrd v. v. Blue Ridge Rural Electric Cooperative (1958) i. Maintains Guaranty test: is state rule (1) Substantive or Procedural (2) Is the procedural rule outcome determinative, and therefore substantive? And adds: (3) Federal interest? 1. In this case, the federal interest related to 7th amendment, and whether jury should be the trier of fact 2. Federal interest may override state law even if substantive law 3. Federal interest is trump card? a. Balancing act between federal interest and state statute. b. Court did not think likelihood of a different outcome was so strong that as to require the federal interest to yield to state statute. c. Cant give state all the power; when considering whether a rule is outcome-determinative, also consider federal In Guaranty Trust and Byrd the Erie problem is cast in a constitutional light. In Hanna, the court frames the issue as one of statutory interpretation, rather than constitutionality. Hanna v. Plumer (1965): Saves Federal Rules of Procedure a. Still good law b. Supplements Guaranty Trust and Byrd: apply outcome-determinative test in light of twin aims of Erie: (1) discourage forum shopping and (2) prevent inequitable application of law

VII.

VIII.

30 i. In essence, Hanna narrows Guaranty Trust; application of outcome determinative test must not be done mechanically, but must be guided by twin aims of Erie, (discouragement of forum shopping and avoidance of discrimination). In Hanna, no need to substitute state rules for federal rules of procedure unless failure to do so would go against twin aims of Erie i. Federal courts must apply state law only when failure to do so would likely result in forum shopping between state and federal courts. Going with federal rules would not result in better deal in federal courts because the federal rule does not violate the REA because it doesnt abridge, enlarge or modify substantive rights. The federal and state rules in this case werent so different that the plaintiff would forum shop. Apply federal rule unless it violates Rules Enabling Act and is unconstitutional Issue: service of process by state or federal law? i. Federal rules 4(e)(2)(B) allows for summons and complaint to be left with a competent person ii. Massachusetts: service of process on a defendant served as an executor of an estate. Take-away: Federal courts apply Federal Rules unless it exceeds Rules Enabling Act. i. Holding: Federal Rule did not exceed congressional mandate embodied in the Rules Enabling Act, and did not transgress constitutional bounds Rules Enabling Act: 28 USC 2072: Congress gave S.C. the power to create rules of procedure for federal courts (1934) i. Only limitation on procedural rules: they shall not abridge, enlarge, or modify any substantive right.

c.

d. e.

f.

g.

IX.

Gasperini v. Center for Humanities, Inc. (1996) i. Gasperini sues for loss of transparencies; awarded $450,000 in compensatory damages; D moved for new trial under Federal Rule 59, saying verdict was excessive. COA applies NY law CPLR 5501(c) which judges whether an award is excessive if it materially deviates from reasonable compensation. This differs from the federal standard of shocks the conscience. 1. Which standard should the federal court apply? State or federal? ii. Federal: Rule 59(a)(1): new trial granted after jury trial for any reason 1. Generally, trial court judge has original discretion to overturn verdicts that go against weight of evidence: shocks the conscience standard, including overturning for excessiveness

31 a. Shocks the conscience: more stringent than materially deviates 2. 7th Amendment: Re-examination clause: no fact tried by a jury shall be otherwise re-examined in any court of the United States, than according to the rules of the common law. iii. NY law: materially deviates from reasonable compensation iv. Supreme Court ruling: 1. No tension between federal interest and state interest embodied in the two rules because it doesnt violate 7th amendmentNY law only a review of abuse of discretion, judged by the materially deviates standard. Additionally, meets the Erie goal of discouraging forum shopping a. CPLR 5501(c) is substantive law under Hanna, therefore, should try to meet aims of Erie b. The review of jury awards is a matter of substantive law. If federal courts apply the more stringent shock the conscience test under federal law in reviewing jury awards for claims governed by New York law, there will be substantial variations in money judgments depending on whether they are brought in New York state courts or federal courts in diversity. 2. Federal courts may apply a state law standard of review rather than shocks the conscience federal standard v. No conflict between state and federal: may apply state vi. Apply Hanna test with twin aims of Erie: 1. (1)procedural or substantive? 2. If procedural, is it outcome-determinative? 3. Is there a federal interest? (Byrd) a. Byrd balance test b. NOTE: REREAD Gasperini for help on Erie analysis X. Shady Grove v. Allstate Insurance Co. a. Using Hanna standard: there is conflict between state and federal rule; apply Federal Rule unless it violates Constitution or REA i. Only limitation by REA: Federal Rule shall not abridge, enlarge, or modify any substantive right. ii. Court states: The short of the matter is that a Federal Rule governing procedure is valid whether or not it alters the outcome of the case in a way that induces forum shopping. iii. Procedural rules are valid as long as they do not violate the REA

32 Swift: Federal courts apply state statutes, but not state C/L Erie: Federal courts apply state law, including C/L, to avoid forum-shopping and discrimination Guaranty Trust v. York: If law is outcome-determinative, then follow the state rule. Byrd: Federal court defers to state procedural rule if it is outcome-determinative; Courts must consider federal interest; federal interest overrides state law, even if substantive Hanna: Part 1: apply outcome-determinative test with aims of Erie: forum shopping/discrimination; Part 2: (Federal rule conflicts with state law): if federal rule violates REA by abridging, enlarging, or modifying substantive right, apply state rule. Framework for analysis (1) Federal constitutional provisions trump state law, procedural or substantive (2) Federal statutes trump state statutes if Congress has the authority to enact it. For example, Congress is authorized to enact Federal Rules of Procedure, but cant legislate a RRs duty to a trespasser. If the statute is arguably procedural, then the federal rule must be applied, even if the federal statute conflicts with state statute (Hanna). (3) Federal rules of civil procedure are applied even if they conflict with state rules. As long as they dont abridge, enlarge, or modify a substantive right, federal rule should be applied. (Hanna). (4) Federal Judicial practice: judges make decisions not addressed by federal statute, the Constitution or Federal Rules. Under Erie, such practices are invalid if they purport to establish rules of primary behavior for which there is no federal constitutional power to make. Other times, it relates to litigation. Apply state rule if practice would be outcome-determinative. Litigation and Remedies XI. Substitution Remedies a. Compensatory damages: redress a concrete loss b. Punitive damages: deter and punish i. State Farm Mutual Automobile Insurance Co. v. Campbell 1. Campbell caused car accident that killed Ospital and disabled Slusher. State Farm, as part of national scheme

33 to cap claim payouts, decided not to settle with Ospital and Slusher, despite clear evidence of Campbells fault. At trial, the Ps were awarded a large sum, and State Farm refused to pay. Slusher and Ospitals counsel approached Campbell and made an agreement with him that he would pursue a bad faith action State Farm and they would not enforce judgment against him. At trial, the jury awarded $1 million in compensatory damages and $145 punitive damages. It appeared that the jury was punishing State Farm for their nationwide policy, rather than just for their actions in the case. ii. Gore test for punitive damages(BMW v. Gore): 1. Degree of reprehensibility a. Repeated? Isolated? Economic/physical harm? 2. Disparity between the actual or potential harm suffered by the plaintiff and the punitive damages award a. Disparity between actual or potential harm and recovery 3. Difference between the punitive damages awarded by the jury and civil penalties authorized or imposed in comparable cases. XII. Specific Remedies a. Equitable i. Permanent injunctions: court commands party to do or not do something 1. Sigma Chemical Co. v. Harris a. Covenant with employees that they will not share information with competitors or work with competitors; Harris violated covenant, and Sigma seeks injunction to keep him from working for competitor i. Covenant was valid ii. Balancing test: more harm done to Sigma than to Harris if injunction not granted Fees a. Evans v. Jeff D i. Attorney Johnson negotiated settlement for client in which he got far more compensation than would be possible at trial; but he had to waive attorneys fees. So he did. The District Court approved of the settlement. Johnson then came back and argued that he deserved a fee and that court abused discretion by not considering purpose of Fees Act (which, he argues, is to provide incentive for attorneys to present low income defendants). b. Fees Act

XIII.

34 i. Evans: court reviewed legislative history of Fees Act and found that Congress didnt intend to ban fee waivers. ii. When viewing settlement, District Court looked at overall fairness of settlement, as required under Rule 23(c); no abuse of discretion. c. Buckhannon v. West VA Dept of HHS i. Who is the prevailing party? Buckhannon argues that under 42 USC 3613(c)(2) they are entitled to attorneys fees as the prevailing party. 1. Buckhannon, however, did not have judicial recognition of their success. 2. Under catalyst theory, Buckhannon argues that it is the prevailing party if it achieved the desired result because the lawsuit brought about a voluntary change in the defendants conduct, even without a merit-based judgment 3. Court: rejects catalyst theory and says that to collect attorneys fees, a prevailing party must have judicial recognition of their success. a. Settlement approved by the court or judgment on the merits XIV. Provisional remedies a. Equitable and specific remedies b. Forms of relief prior to adjudication. Court action before litigation is over i. Preliminary injunctions, restraining order c. Issue: are provisional remedies a violation of due process? i. Potentially hurts defendants; need balancing test ii. William Inglis and Sons Baking Co. v. ITT Continental Baking Co (1976) 1. Wants preliminary injunction to stop bakers from offering cheap bread; wants to stop price fixing while waiting for court to hear anti-trust case. a. Needs the preliminary injunction; otherwise will probably go bankrupt. b. Court: dont need to be reasonably certain to succeed; only need fair chance i. Balancing test: 1. Probable success and irreparable injury 2. Or, such serious questions raised, and balance of hardship tips sharply in favor of party seeking injunction

35 iii. New test 2008: Winter v. Natural Resources Defense Council, Inc 1. Possible standard is too lenient; instead, success and injury must be probable a. Test: (1) P must show will likely succeed on the merits, (2) likely to suffer irreparable harm in the absence of preliminary relief, (3) balance of equities tips in his favor, (D will be not be harmed more than P helped by giving P preliminary injunction) and (4) injunction is in the public interest (navy sonar affecting whales) d. Due process issue i. Fuentes v. Shevin 1. Fuentes purchased gas stove and phonograph from Firestone, and fell behind on payments. Firestone filed small-claims action, seeking to repossess the items, and obtained a writ of replevin (from a court clerk, as per state statute) ordering a sheriff to seize the goods immediately. The sheriff seized her goods even before she was served with the complaint. a. Writ of replevin: obtained by Firestone from clerk, without showing proof of entitlement; Fuentes had three days to post bond, or Firestone got the goods. 2. Supreme Court: a. no bright-line rule. Even if deprivation is for a short time, could still be unconstitutional (against due process) b. due process applies to any significant property interest, even household goods; irrespective of whether fully paid for or not c. Exceptions in extraordinary circumstances: these three factors are required: i. Seizure directly necessary to secure important government or public interest ii. Need for prompt action iii. State keeps strict control over legitimate use 1. Narrowly drawn statute, interpreted by public official d. To protect due process rights of defendant i. Right to notice and be heard at meaningful time and in meaningful manner

36 ii. Notice and opportunity to be heard before seizure with time for prevention iii. Informed evaluation of claims by neutral official Pleadings I. II. III. English C/L: very technical; 30 or 32 writs Modern: less technical; claims not as easily dismissed, but some restrictions to keep frivolous suits out. (Federal Rules) Rules Enabling Act: power to S.C. to make Federal Rules of Procedure a. Rule 1: all civil claims in District Ct are governed by Rules b. Rule 2: all claims are civil actions IV. Pleadings: documents where plaintiff and defendant set forth their claims and answers (Rule 7(a) p.29) a. Complaint: (P) b. Answer: (D) Rule 10: Basic Rules for Pleadings: captions, paragraphs etc. (p.33) Complaint serves many functions a. Notice i. Enough to let defendant know what he or she must defend against, and to give court idea what kind of remedy is possible ii. But not too much 1. Dont want to share too much information with D, possibly revealing strategy 2. Expensive to gather lots of info, deposing witnesses etc. b. Tension between too much and too little info gives rise to Rule 8 i. Standard of federal courts: notice pleading; purpose is to give D time and info to prepare defense ii. Court assumes all factual allegations in complaint are true 1. Guidelines for complaint: a. Rule 8 (p.30): (a) A pleading that states a claim for relief must contain: (1) a short and plain statement of the grounds for the courts jurisdiction, unless the court already has jurisdiction and the claim needs no new

V. VI.

37 jurisdictional support; [SMJ and PJ] (2) a short and plain statement of the claim showing that the pleader is entitled to relief; and (3) a demand for the relief sought, which may include relief in the alternative or different types of relief. i. Failure to state a claim: Rule 12(b)(6) ii. Dismissal without prejudice: may amend iii. 8(a)(1) similar to well-pleaded rule 2. Forms to help with pleadings a. Form 7: Statement of Jurisdiction (p.173) 3. 28 USC 1367(c)(3): court has discretion not to exercise SMJ iii. Signature on pleadings 1. Rule 11 (p.33): goal is to deter improper conduct a. (a) pleading, written motion must be signed by attorney, or if not represented by counsel, by the party b. (b)whatever is submitted is certified to be reasonable under the circumstances: dont waste courts time! i. documents: (1) were not filed for improper purpose, e.g. delay, harass, (2) for a claim warranted by existing law and are not frivolous; (3) with evidentiary support for factual allegations; (4) denials of factual contentions are warranted on the evidence. c. (c) Sanctions for violation of 11(b) i. Discretion of court: Bridges v. Diesel 1. claim brought under Americans with Disabilities Act; but lawyer hadnt exhausted administrative remedies yet; lawyer admitted mistake and learned. Court didnt fine him ii. 11(c)(2): notice and opportunity to be heard 1. party intending to make 11(c) motion must give other party copy of motion before court will give sanctions 2. This gives the other party a chance to change their pleading

38 3. Party has 21 days to change pleading; if they dont other party can file 11(c) motion in court d. Rule 11: only for papers; not for sanctioning other conduct related to litigation, discovery etc. Standard for complaint: Rule 8(a)(2): a short and plain statement of the claim showing that the pleader is entitled to relief a. Conley v. Gibson (1957) i. Complaint ok, unless there is no doubt that the facts cant be proven b. Leatherman (1993) and Swierkiewicz v. Sorema (2002) i. Ok, as long as you can plead some facts c. Bell Atlantic v. Twombly (2007) i. New standard: facts must be plausible, not just possible 1. Need more than speculative facts; mere conclusory statements will not do. d. Ashcroft v. Iqbal (2009) i. Emphasizes plausibility standard ii. Complaint must contain factual matter, accepted as true, to state a claim to relief that is plausible on its face. (Supp.421) 1. More than possibility, less than probability=plausibility

VII.

Conley, Leatherman, Sorema: possible Twombly, Iqbal: plausible 8(a)(2) analysis using the Bell Atlantic v. Twombly (supplemented by Iqbal) standard *Two prong test: (1) Court accepts all facts in a complaint as true; if the facts are true, is it plausible that the case will have merit? However, assumption of truth does not extend to legal conclusions. Conclusory statements are not good enough. (2) Complaint that states a plausible claim for relief survives a motion to dismiss. Special cases for complaints -Certain claims have more stringent standards, such as fraud, which is governed by Rule 9. Under Rule 9(b), need particularity concerning the circumstances of fraud; but malice, intent, knowledge, and other conditions of the persons mind need only be alleged generally. e.g. Stradford v. Zurich Insurance -Dentists cheats insurance company; insurance company does not allege specific facts of fraud; court gives insurance co leave to amend. Allocating elements of claim

39 Assumptions: (1) Court knows all elements of the claim, and (2) plaintiff has burden of proving elements. Jones v. Block: should exhaustion be argued by plaintiff, or is it an affirmative defense? The court rules that under Rule 8(a)(2) the plaintiff is required only to make a short and plain statement. Therefore, exhaustion is an affirmative defense because the court cant require a heightened pleading standard. Responding to Complaint -D can file (1) answer or (2) pre-answer motion Rule 55(a): default answer entered if D doesnt respond. Rule 12(a)(1)(A): D must respond within 21 days after being served with summons and complaint -If service of process is waived: 60 days after request for waiver was sent, or within 90 days after it was sent to D outside of U.S. Rule 12(a)(4): Pre-answer motion: D has 14 days after courts decision on preanswer motion to file answer. Pre-answer motions: contained in 12(b)(1)-(6) Rule 12(b) (1) lack of subject-matter jurisdiction (2) lack of personal jurisdiction (3) improper venue (4) insufficient process -rare; insufficient process means papers are not in order (5) insufficient service of process -insufficient service; method of service challenged; does it violate the Mullane decision? (6) failure to state a claim upon which relief can be granted (7) failure to join a party under Rule 19 Rule 6(a): computing time; include Sun., Sat., and legal holidays; exclude day of event that triggered the period Rule 12(g)(2): first response must include 12(b) defenses, or you lose the ability to use them 12(h)(1): omission in 1st response=waiver, or failure to include in amendment

40 12(e): motion for more definite motion. Rarely granted because if the complaint is so vague, D will make 12(b)(6) motion and try to get it dismissed. 12(f): motion to strike -Remove certain parts of complaint that are redundant, scandalous, immaterial, or impertinent matter. 12(c) Motion for judgment on the pleadings -Theres no case; after all the pleadings, its obvious that one party should win. Answer to complaint (1) denying allegations (2) raising affirmative defense to Ps claims Denials 8(b)(2-5) (1) (A) short and plain defense to each claim asserted against D (B) must admit or deny allegations respond to substance (2) respond to substance of allegation (3) general denial: deny all claims; specific denial of particular claims; or denial of all claims except for those specifically admitted (4) If denying part, admit the part that is true and deny the rest (5) lack of sufficient information to deny or admit; amounts to denial (6) if responsive pleading if required and the allegation is not denied, then allegation is considered admitted; if responsive pleading is not required, an allegation is considered denied 8(b)(6): If response pleading is not required, an allegation is considered denied or avoided (to protect P). General denial: P has to prove everything in the complaint at trial 8(c)(1): affirmative defenses; list is not exhaustive Reply: response to the answer; ordered by the court under 7(a)(7). Not mandatory, but court can order it Amendments to pleadings -Promotes notice (1) fix ambiguities, defects that would cause unnecessary or costly delays caused by bad pleading (2) Provide D with more notice about lawsuit

41

(3) Litigants ought to have claims tried on merits, rather than thrown out for pleading issues (technical rules) Qualification: most courts use liberal approach; balances against burden on opposing party; also look at potential prejudice that would result. Rule 15 -apply to all pleadings How do amendments come into play? (1) new facts, during discovery (2) problem with your pleading and you want to fix it (3) new things happen that are somehow related to your existing claim Rule 15 (a)(1): a party may amend its pleading once as a matter of course: (A) 21 days after serving it; or (B) If the pleading is one to which a responsive pleading is required, 21 days after service of a responsive pleading or 21 days after service of a motion under Rule (b)(e) or (f) whichever is earlier. First shot amendment without leave of the court or opposing party For P: amend as matter of course, within 21 days after service of Ds answer or after motion 12(b), (e), or (f) 15(a)(2): if you miss free shot of (a)(1), need opposing partys consent or leave of court Test for allowing amendment (1) No undue prejudice (2) No bad faith (3) No bad motive (4) No undue delay (5) No repeat failure to fix deficiencies Beeck v. Aquaslide Court says because there was no bad faith, and no prejudice to the plaintiff, D may amend and deny manufacture of the slide. Decided on bifurcated trial, in the interest of judicial economy Rule 15(c)(1): Relation Back of Amendments 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;

42 (B) the amendment asserts a claim or defense that arose out of the conduct, transaction, or occurrence set outor attempted to be set outin the original pleading; or (C) the amendment changes the party or the naming of the party against whom the claim is asserted, if Rule 15(c)(1)(B) is satisfied and if, within the period provided by Rule 4(m) for serving the summons and complaint, the party to be brought in by amendment: (i) received such notice of the action that it will not 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 partys identity. Relation back: amended pleading treated as if were filed at time of original pleading; allows the P to avoid the ban of S/L Relating back under 15(c)(1)(C), where P wants to add a party by amending Need 3 things: (1) Satisfy requirement of 15(c)(1)(B): claim arises out of the same conduct as original pleading (2) Must be filed within 120 days of the first filing (4m), the D has received such notice of the suit that he or she will not be prejudiced in defending. Two ways to do this: (a) serve copy of original complaint on new D within 120 days of filing (b) New D has constructive notice within 120 days (3) New D knew or should have known that action wouldve been brought against it but for a mistake by the P concerning the proper parties identity. Key issue: does original complaint give notice to D of possibility of facing allegation in amended complaint? Is the amendment properly related to the original complaint? Moore v. Baker 1st complaint: consent, before surgery 2nd complaint: negligence, during and after surgery problem: not arising out of same conduct. Contrast with: Bonerb v. Richard J. Caron Foundation 1st complaint: negligent maintenance of basketball court 2nd complaint: counseling malpractice Take away for 15(c)(1)(C): relation back depends on what the D knew, or should have known, not what the P knows.