Civil Procedure 1 – Martin


Civil Procedure

Professor Martin

Personal Jurisdiction

  1. Traditional Basis
    for Jurisdiction

    1. Pennoyer v.
      Neff

      1. Rule: Every
        state possesses exclusive jurisdiction and sovereignty over
        persons and property within its territory; therefore, the courts
        of that state may enter a binding judgment against a non-resident
        only if he is personally served with process while within the
        state, or, if he has property within the state, if that property
        is attached before litigation begins
      2. Reasoning: In a
        quasi in rem action such as this, you must attach land at the
        beginning of the lawsuit, usually on the same day you file,
        because you need to establish jurisdiction before the suit can go
        on.
    2. Overview of Two
      Types of Jurisdiction

      1. Subject matter
        jurisdiction:
        The ability of the court to hear a particular
        type of case.
      2. Personal
        jurisdiction
        : The ability of the court having subject matter
        jurisdiction to exercise power over a particular defendant or
        piece of property. The plaintiff seeks to assert PJ through
        service of process on defendant (D). Service of process is means
        by which court symbolically “tags” the defendant or his or her
        property.
    3. Three Type of
      Personal Jurisdiction

      1. In Rem: This
        action is against the actual property, real or personal, and is
        solely about who has ownership over that property. Is a suit of
        person against “the world,” to gain power over property. The
        property must be located within the physical borders of the forum.
      2. Quasi In Rem:
        This action is against the land in order to establish jurisdiction
        where cause of action is related to property between specific
        parties (i.e. not a person against “the world”) or where cause
        of action not related to the property, but property is used to
        enforce judgment.

        1. Note: The
          basis of the court’s power to exercise in rem and quasi in rem
          jurisdiction is the property within the state. The judgment does
          not bind the D personally and cannot be enforced against any
          other property belonging to the D.
      3. In Personam:
        This action is against the person and the awards are not limited,
        and the judgment can be enforced anywhere that the person has
        property.
    4. What is general
      jurisdiction?

      1. Situation where
        the suit is unrelated to the in-state activities.

      2. Continuous and
        systematic activities in forum state are required.

    5. What is specific
      jurisdiction?

      1. Situation where
        the suit concerns D’s in-state activities.

      2. Minimum contacts are
        needed.
    6. Ways to get
      jurisdiction over an individual:

      1. Domicile:
        Jurisdiction may be exercised over a person who is domiciled
        within the forum state, even if the person is temporarily absent
        from the state. A person is considered to be domiciled in the
        place where he has his current dwelling place, if he also has the
        intention to remain in that place for an indefinite period.
      2. Residence:
        Some states allow jurisdiction to be exercised on the basis of
        residence in the forum state, even though he is absent from the
        state. A person may have several residences simultaneously.
      3. Physical Presence:
        Jurisdiction may be exercised over an individual by virtue of his
        presence within the forum state. That is, even if the individual
        is an out-of-state resident who comes into the forum state only
        briefly, personal jurisdiction over him may be gotten as long as
        service was made on him while he was in the forum state. (Burnham)
      4. Property:
        Many states exercise jurisdiction over owners of in-state property
        in causes of action arising from that property.
      5. Consent:
        Jurisdiction can be exercised by virtue of her consent, even if
        she has no contacts whatsoever with the forum state. Consent can
        either be implied (Hess) or explicit (Kane).
      6. Tortious acts
        committed in state
        : Many states have statutes allowing
        their courts jurisdiction over persons committing tortious acts
        within the state. Some of these “in-state tortious acts”
        long-arm clauses have been interpreted to include acts done
        outside the state which produce tortious consequences within the
        state. (Gray)
      7. Conducting
        business
        : States often exercise jurisdiction over
        non-residents who conduct business within the state. Since states
        may regulate an individual’s business conduct within the state,
        they may constitutionally exercise jurisdiction relating to that
        doing of business.
      8. Domestic relations
        cases
        : Courts sometimes try to take personal jurisdiction
        over a non-resident party to a domestic relations case. However,
        the requirement of “minimum contacts” applies here (as in
        every personal jurisdiction situation) and that requirement may
        bar the state from taking jurisdiction. (Kulko)
    7. The Role of the
      Constitution in Establishing Jurisdiction

      1. Full Faith and Credit
        Clause
        – “Full faith and credit shall be given in each
        state to the public acts, records and judicial proceedings of
        every other state”. Once congress authenticates such acts,
        records, and proceedings, “they should have such faith and
        credit given to them in every court within in United States as
        they have by law, or usage, in the courts of the state from which
        they are or shall be taken.”
      2. 14th Amendment
        Due Process – “Proceedings in a court of justice to determine
        the personal rights and obligations of parties over whom that
        court has no jurisdiction do not constitute due process of law.”
  2. Expanding the Bases
    of Personal Jurisdiction
    1. Express Consent
      Kane v. New Jersey

      1. Expressed consent to
        jurisdiction over matters arising from a party’s activity within
        the state by requiring an out-of-state motorist to file a formal
        instrument appointing a New Jersey agent to receive process prior
        to using the state’s highways.
    2. Implied Consent
      Hess v. Pawloski

      1. Rule: State
        has the power to declare that all non-residents who use its
        highways have impliedly consented to submit to the state’s
        jurisdiction for all actions arising from that highway usage
      2. Policy reason:
        “Motor vehicles are dangerous machines, and, even when
        skillfully and carefully operated, their use is attended by
        serious dangers to persons and property. In the public interest,
        the state may make and enforce regulations reasonably calculated
        to promote care on the part of all, residents and non-residents
        alike, who use its highways.”
  1. A New Theory of
    Jurisdiction

    1. International
      Shoe Co. v. Washington

      1. Rule: A
        corporation will be subject to the jurisdiction of any state with
        which it has “minimum contacts” that make the exercise
        of jurisdiction consistent with “traditional notions of fair
        play and substantial justice
        “.
      2. Reasoning: State
        has jurisdiction based on location. First, location is presence
        in general, asking whether or not corporation does a fair amount
        of business in the state. “Minimum contacts” with the
        forum state is sufficient to sue corporation so long as it is
        “fair and reasonable“. Second, presence at the time of
        the tort, asking whether or not the corporation was receiving
        benefits from the forum state at the time of the tort.
        Corporation receiving benefits from laws of forum state should be
        subject to that state’s jurisdiction.
  2. Specific
    Jurisdiction and State Long-Arm Laws

    1. The Development of
      Long-Arm Laws

      1. Long-arm statutes seek
        to provide personal jurisdiction over nonresidents who cannot be
        found and served in the forum.

        1. Substitute
          service
          : Long-arms typically provide for substitute means of
          service, since in-state personal service is not possible.
      2. Long-arm
        statutes allow jurisdiction on the basis of certain links between
        the defendant and the forum state, such as domicile, ownership of
        property, commission of a tortious act, etc.

      3. Out-of-state
        acts with in-state consequences: Many states long-arms explicitly
        cover acts done outside the state with in-state consequences, and
        where they do not, courts can interpret the statute to be read as
        such.

      4. Unlimited
        long-arm statutes: A few states, such as California, have long-arm
        statutes that given their courts power over any person or property
        which the state can constitutionally exercise jurisdiction.

      5. Long-Arm Statute
        Test:

        1. Is there a
          long-arm statute?
        2. Is it
          constitutional?
  3. Analyzing Personal
    Jurisdiction Problems

    1. Was D present in
      the forum state when process was served on him?

      1. Burnham v.
        Superior Court

        1. Rule: The DPC
          does not deny a state jurisdiction over a person personally
          served with process while temporarily in a state, in a suit
          unrelated to his activities in the state. (Need to show minimum
          contacts to get 8 judges)

          1. 3 Justices
            (Scalia, Kennedy, Chief Justice) say a state can have
            jurisdiction over persons physically present in state.
          2. 4 Justices
            (Brennan, Marshall, Blackmun AND O’Connor) say there must also
            be minimum contacts per Shaffer. (Concurred with judgment
            because thought there was minimum contacts)
          3. 1 Justice
            (White) says it doesn’t matter because the rule is service
            alone is sufficient to gain personal jurisdiction.
          4. 1 Justice
            (Stevens) is on the fence because the parties didn’t introduce
            the issue.
      2. Note Case: Quill
        v. North Dakota

        1. Holding: DPC
          did not prohibit a state court from asserting personal
          jurisdiction in a suit brought by the state to enforce its use
          tax against an out of state mail order house with no outlets or
          sales reps in the State. Contacts with instate consumers and
          mail were sufficient because the goods were used in the state
        2. Rule: DPC does
          not require physical presence in the forum state to collect tax.
    2. Does the forum
      state’s long arm statute provide for jurisdiction over D?

      1. Substantial
        connection?

        1. Yes – Gray
          v. American Radiator & Standard Sanitary Corp.
          (S.
          Ct. of Illinois, 1961)

          1. Holding/Rule of
            Law
            : D manufactures valves in State A and sells them to a
            heater manufacturer in State B. The heater manufacturer
            incorporates B’s valves into its heaters and sells in States
            C, D, and E. Valve explodes and injures P in State E. D is held
            liable because it knew that some of the valves it manufactured
            would go to State E and expected to be protected by the laws of
            State E. The International Shoe minimum contacts requirement is
            satisfied even when a corporation conducts no business within a
            state, so long as the act giving rise to the lawsuit has a
            substantial connection” to the state
        2. No – Note Case:
          Green v. Advance Ross (1981) – Illinois
          long-arm statute that said an out-of-state resident submits to
          the jurisdiction of Illinois when he commits a tort that cause a
          diminution of the funds of a Illinois corporation was
          unconstitutional because it would allow corporations to bring
          people in to Illinois courts no matter how remote their
          connection with the forum. IL Supreme Court distinguishes itself
          from Gray
    3. Is any of the
      following true?

      1. D is domiciled in the
        forum state.
      2. D has consented to be
        sued in the forum state.
        See Another Base of Jurisdiction:
        Consent
      3. D owns property in
        the forum state.
        See Jurisdiction Over Property
      4. D regularly transacts
        business in the forum state.
        (These contacts are so
        completely voluntary and unambiguous that they automatically
        constitute minimum contacts and entitle the state to exercise
        personal jurisdiction over D, whether the claim relates to D’s
        in-state activities or not.)
    4. Are at least some
      of D’s contacts with the forum state voluntary?
    5. Does the cause of
      action arise out of or relate to D’s contacts with the forum
      state?

      1. If yes, go to F.
      2. If no, are D’s
        contacts with the forum state “systematic and continuous”?
      3. YesPerkins
        v. Benguet Consolidated

        1. Holding: The
          mining company president’s in-state activities were held to be
          extensive enough so that Constitutional due process neither
          prohibited nor compelled Ohio’s jurisdiction over the mining
          company; the matter was left to the courts.
        2. Rule: The court
          held that where the cause of action does not arise from business
          done within the forum state, Constitutional due process requires
          that the in-state business actually conducted be so systematic
          and continuous as to make it not unjust that the corporation be
          forced to defend a suit there.
      4. No
        Helicopteros Nacionales v. Hall

        1. Rule:
          Negotiations and purchasing in the forum state do not constitute
          continuous and systematic contacts sufficient to satisfy the
          requirements for general in personam jurisdiction.
        2. Reasoning:
          Sending the CEO for contract negotiations, accepting checks drawn
          on Houston bank, purchasing helicopters equipment and training
          services in Fort Worth, and sending personnel there for training
          are insufficient for general jurisdiction.
        3. Dissent: Brennan
          believes Helicol’s purposeful availment of the benefits and
          obligations of Texas constitute sufficient minimum contacts to
          make it fair and reasonable for the State to assert jurisdiction
          over Helicol. The undisputed contacts between Helicol and Texas
          are sufficiently related to the underlying cause of action, and
          jurisdiction does not offend traditional notions of fair play and
          substantial justice. Because of their participation in
          interstate and foreign commerce, Helicol should reasonably expect
          to be called into Texas for litigation, based on the doctrine of
          general jurisdiction. Also, he believes that the wrongful-death
          claim is sufficiently related to the contacts between Helicol and
          Texas to warrant specific jurisdiction.
      5. No – 15,000
        Magazines Per Month Not Enough To Be Systematic and Continuous –
        Note Case:
        Keeton v. Hustler Magazine

        1. Hustler sold 15,000
          copies of a magazine a month to the forum state, but the court
          would only hold that this—though continuous and
          systematic—GENERAL jurisdiction would not occur-only specific.
      6. No – Contacts
        Must Be Overwhelming – Note Case:
        Fisher Governor Co. v.
        Superior Court

        1. Similar to Keeton –
          Sales and sales promotion to a state by independent, no exclusive
          representatives are not enough to assert general jurisdiction.
          This case makes clear that there needs to be an overwhelming
          number of contacts for general jurisdiction.
      7. Yes – Note
        Case:
        Frummer v. Hilton Hotels Int’l, Inc.

        1. When two
          corporations are interlocked in ownership thereby creating an
          agency relationship between the two, but are in different
          countries, either company can be sued in either country.
      8. No – Note Case:
        Ratliff v. Cooper Laboratories, Inc.

        1. Drug manufacturer
          case. When the plaintiffs are non-resident of the state, the
          defendants have their principal places of business outside of
          that state and are incorporated outside that state, the action
          arises outside of that state, general jurisdiction cannot be
          obtained.
    6. Are D’s contacts
      with the forum state sufficiently great that they should be deemed
      “minimum contacts”?

      1. Minimum Contacts
        Rule: 2 part analysis
      2. Purposeful Availment
        & Foreseeability

        1. D’s contact with the
          forum must result from his or her purposeful availment with that
          forum. Contact cannot be accidental. D must reach out to the
          forum in some way, such as to make money or use roads.
        2. Contacts that exist
          only through unilateral acts of 3rd parties are
          insufficient.
        3. Rationale: It is unfair
          to non-resident D to defend in forum state unless, given his
          purposeful activities, he could reasonably foresee being haled
          into that state’s courts.
        4. D must have
          purposefully availed self of privileges of conducting activities
          in forum state, thus invoking the benefits and protections of its
          laws.
        5. Among the facts
          considered significant in analyzing purposeful availment
          are

          1. Soliciting
            business in the forum state
          2. Having offices
            and/or employees in forum state
          3. Visiting the forum
            state in connection with the events leading to the litigation
          4. Entering into a
            contract

            1. With a party in
              the forum state; and/or
            2. That calls for
              some aspect of its performance in the forum state; and/or
            3. That calls for
              application of the forum state’s law; and/or
            4. That contemplates
              long-term relationship with someone in forum state
            5. Owning/renting
              property in forum state
            6. Deriving revenue
              from forum state
            7. Sending/receiving
              mail, email, calls, or faxes to/from forum state
            8. Engaging in
              intentional and harmful conduct, the effects of which are felt
              (targeted toward?) the forum state
        6. No – Because
          Unilateral Act by Third Party –
          Hanson v. Denckla

          1. Holding/Rule of
            Law:
            The Delaware trust company has no office in Florida,
            and transacts no business there . . . The record discloses no
            solicitation of business in that State either in person or by
            mail. The unilateral activity of those who claim some
            relationship with a nonresident cannot satisfy the requirement
            of contact with the forum state. There must be some act by which
            the defendant purposefully avails itself of the privilege of
            conducting activities within the forum state, thus invoking the
            benefits and protections of its laws.
        7. Yes – When
          Contract Ties Parties’ Business Activities to Forum State Will
          Tend To Show Minimum Contacts-
          Burger King v. Rudzewicz

          1. Holding/Rule of
            Law:
            This franchise dispute grew directly out of “a
            contact that had a substantial connection w/ that State.”
            The parties’ repeated course of dealing confirmed that
            decision-making authority vested in Miami. The court held that
            by signing the contract with the provision regarding Florida
            law, the defendant had purposefully availed himself of the
            benefits and protections of the forum state’s laws.  A
            party who establishes purposeful minimum contacts with a state
            is subject to that state’s exercise of personal jurisdiction
            over him. Further, choice-of-law provision D signed means that
            in an agreement, the parties agree to apply the law of a forum
            state. Standing alone, the provision would not be sufficient to
            establish jurisdiction to bring suit in that state. However,
            because the agreement is accompanied by a relationship and
            contacts within that state, there would be jurisdiction in the
            forum state.
        8. Yes – If
          Manufacturer Knows Product Will Eventually Be Sold In Forum
          State, Should be Enough for Minimum Contacts –
          Asahi
          Metal Industry Co. v. Superior Court
          (HOWEVER,
          SEE FAIRNESS SECTION)

          1. Rule: The
            defendant must purposefully avail himself of the forum by more
            than just putting a product into the stream of commerce with the
            expectation that it will reach the forum state, however, such
            conduct is enough to satisfy the minimum contacts requirement.
            Nonetheless, once it has been established that minimum contacts
            exist, the fairness requirement must still be met as well, which
            will be much harder to do in the case of a non-U.S. resident.
          2. Reasoning:
            1. O’Connor’s 4
              require knowledge that the stream of commerce will move
              the product into the forum state’s market plus additional
              conduct
              such as advertising or marketing in that state or
              deliberately designing product for that state. Although there
              are minimum contacts, exerting jurisdiction over Asahi would
              offend traditional notions of fair play and substantial justice
              such that jurisdiction is improper.
            2. Brennan’s 4
              disagree with O’Connor that additional conduct is needed.
              Knowledge that the product with end up in the forum state is
              enough to exert jurisdiction over defendant. However, they
              agree with O’Connor that jurisdiction is improper in this
              case because it would offend traditional notions of fair play
              and substantial justice.
            3. Stevens: “I
              would be inclined to conclude that a regular course of dealing
              that results in deliveries of over 100,000 units annually over
              a period of several years would constitute ‘purposeful
              availment’ even though the item delivered to the forum State
              was a standard product marketed throughout the world.”
        9. No – Adopted
          O’Connor’s Purposeful Availment Test – Note Case:
          Rodriguez
          v. Fullerton Tires Corp. v. Custom Metal Spinning Corp.

          1. “Even assuming D had
            specific knowledge that the stream of commerce would move its
            tire rims into Puerto Rico, this awareness alone would not be
            enough to constitute the purposeful availment that is necessary
            for a showing of minimum contacts.”
        10. Misapplication
          of
          Asahi – Note Case: Parry v.
          Ernst Home Center Corp.

          1. Japanese co.
            makes a maul, given to CA corporation, goes to Idaho retailer
            (D), where Linda buys it, takes it to Utah to give to dad, who
            lets friend borrow it & friend (P) is injured in Utah while
            splitting logs. Court found that there was no jurisdiction here,
            because as in Asahi, company didn’t have the additional
            conduct necessary to sell product in Utah or Idaho.
        11. Yes – Phone
          and Mail Contacts Enough –
          Alchemie International, Inc.
          v. Metal World, Inc.

          1. Mail and telephone
            contacts, seen as “significant contacts” with plaintiff,
            were enough to establish jurisdiction when those contacts had
            solicited, executed, and allegedly breached a substantial
            commercial contract.
        12. Yes – One Act –
          Specific Jurisdiction –
          McGee v. International Life
          Insurance Co.

          1. Rule: A
            state may exercise jurisdiction over a defendant whose contacts
            with that state consist of only a single act, provided that that
            act is what gave rise to the claim for which jurisdiction is
            being sought, and was deliberately directed toward the state.
          2. Reasoning:
            Commerce has become more nationalized and contracts are
            increasingly between states. Given the nature of the insurance
            business, small policy holders would be denied justice if forced
            to file suit in a foreign jurisdiction. Also, the fairness
            factor of the insurance company having to come out to California
            is outweighed by California’s interest to protect its
            citizens. And, because the company had a policy in CA and
            because they communicated with the policyholder in California,
            they could foresee being haled into court there.
        13. No – Simply
          Causing an Effect in FS Not Enough
          Kulko v.
          Superior Court

          1. Rule: A
            state may not exercise jurisdiction over a defendant who has not
            purposefully availed himself of the benefits of that state, even
            if the state has a strong interest in the litigation.
          2. Reasoning:
            “Merely causing an effect within the forum state without
            purposeful availment will not support jurisdiction. There is no
            claim that the defendant has visited physical injury on either
            property or persons within the state of California. The cause
            of action here asserted arises from personal relations, not
            business relations.”
        14. Effects Test –
          Note Case:
          Harris Rutsky Co. Insurance Services v. Bell
          & Clements Ltd.

          1. D must have 1)
            committed an intentional act, 2) expressly aimed at the forum
            state, 3) causing harm, the brunt of which is suffered – and D
            knows is likely to be suffered – in the forum state.
        15. Yes – First
          Amendment No Protection – Note Case:
          Calder v. Jones

          1. P was entertainer
            defamed by National Enquirer. NE claimed no personal
            jurisdiction and Superior Court agreed on the ground that First
            Amendment concerns outweighed jurisdictional concerns. Supreme
            Court disagreed and said there was no trouble finding NE could
            foresee being haled into court in CA.
        16. No –
          Foreseeability Alone Not Enough – Must Be Effort As Well

          World-Wide Volkswagen Corp. v. Woodson

          1. Rule: In order
            to be subject to a state’s jurisdiction, a defendant must have
            chosen to come contact with that state; considerations of
            fairness, convenience, and the interests of the state in
            overseeing the litigation are otherwise irrelevant.
          2. Reason: The
            unilateral activity of bringing a product into a state is not
            enough for that state to have jurisdiction. Foreseeability
            alone has never been enough under the Due Process Clause; what
            is critical to due process is rather the foreseeability of being
            sued in the forum state. Minimum contacts must be based on some
            act committed by the defendant and the defendant must have
            chosen to purposefully avail itself of the forum state. The
            Court is trying to protect people from being pulled into court
            in a forum state where they had absolutely no contact and
            purposely chose to have no contact. If we ignored the minimum
            contacts rule, WWV could be sued anywhere because a car they
            sold in NY might have foreseeably be driven in another state,
            even if WWV made a conscious decision not to sell in that state
            and never had any contact whatsoever with that state.
          3. Policy reason:
            If foreseeability alone is enough, then the defendant can be
            sued everywhere.
          4. Dissent: Brennan.
            The defendant need not deliberately seek contacts with the
            state if defendant has some contacts with the state, especially
            with regards to cars and its mobile nature. Considering factors
            other than extensiveness of defendant’s contacts, such as
            fairness and convenience of the plaintiff, it is reasonable to
            subject the defendant to the forum state’s jurisdiction.
            Fairness factors include efficiency of forum court, location of
            evidence in forum state, plaintiff’s hospitalization in forum
            state, the minimal inconvenience suffered by defendants in being
            required to defend themselves in the forum state.
      3. Internet Cases –
        Active v. Passive Websites

        1. Yes – Sending
          Tortious Emails to FS
          Bellino v. Simon

          1. Personal jurisdiction
            is not exercised on Spence based on one unsolicited telephone
            call from forum state to nonresident Spence. Although allegedly
            defamatory comment made by Simon first occurred during the
            telephone call made by Aubert, this phone call resulted from
            several email communications which, in a broad sense, Simon
            initiated through his website. Simon affirmatively directed the
            allegedly tortious emails to Louisiana. Although FDS (Simon’s
            company) and Bellino do not live in LA and would therefore have
            to defend suit there, the principal witness Aubert is in
            Louisiana and the effect of the tortious activity was felt in
            Louisiana. Therefore, this does not offend “traditional
            notions of fair play and substantial justice”.
        2. Yes – Note Case:
          Inset Systems, Inc v. Instruction Set, Inc.

          1. Internet website
            advertisement operated by non-resident sufficient to establish
            personal jurisdiction under purposeful availment test. Since
            then, courts have been reluctant to find jurisdiction based
            solely on the existence of website advertisements.
        3. No – Note Case:
          Cybersell, Inc. v. Cybersell, Inc.

          1. Need something more
            than maintenance of website to show that defendant purposefully
            directed activities at the forum.
        4. Sliding Scale
          Test – Note Case: Zippo Mfg. Go v. Zippo Dot Com, Inc.

          1. The court articulated
            what has become known as the ‘sliding scale’ test, under
            which ‘the likelihood that personal jurisdiction can be
            constitutionally exercised is directly proportionate to the
            nature and quality of commercial activity that an entity
            conducts over the Internet.’
          2. Active”
            websites
            : If defendants conduct business over the Internet
            with residents of a particular forum through these websites, the
            assertion of jurisdiction is almost always proper.
          3. Interactive”
            websites
            : The sliding scale becomes relevant in these cases
            where a user is permitted to exchange information with a host
            computer; the debate is over this middle ground. “The Supreme
            Court has yet to consider the issue of personal jurisdiction
            based upon Internet contacts.”
          4. Passive”
            websites
            : If defendants do little more than make information
            available to those who are interested, there are rarely grounds
            for the assertion of personal jurisdiction.
        5. No – Note case:
          Hycite Corp v. Badbusinessbureau.com, L.L.C

          1. Court didn’t follow
            test articulated in Zippo. They stated cannot determine whether
            P.J. is appropriate by deciding what type of website it is
            (passive or active). Contacts through the website must be so
            substantial that they may be considered “continuous and
            systematic” for the purpose of general jurisdiction.
        6. Yes – Online
          Contracts are Purposeful Availment – Note Case: Compuserve,
          Inc. v. Patterson

          1. Court held that D
            purposefully perpetuated a relationship with Compuserve via
            repeated communications with its system in Ohio by entering into
            a written contract with Compuserve and choosing to transmit his
            software to Compuserve’s system in Ohio so that others gained
            access to his software via that system.
    7. Is jurisdiction
      fair and reasonable?

      1. Fairness Factors
        (as spelled out in Burger King)

        1. Burden on the D
          – multiple concerns including relative health and/or wealth of
          the D. Forum easily reached? Will case come to trial quickly in
          this forum? Almost any factor that can be argued.
        2. Forum state’s
          interest
          – The forum state may have a legitimate interest
          in providing redress for its residents.
        3. Plaintiff’s
          interest
          – similar to Burden on D – lack of truly
          available alternative forum, lack of adequate discovery or other
          procedural benefits in another forum or unfavorable choice of
          law.
        4. Convenience
          – The forum is constitutionally acceptable unless it is “so
          gravely difficult and inconvenient that a party is unfairly put
          at a severe disadvantage in comparison to his opponent.” This
          is a very difficult standard to meet and D will usually not be
          able to meet it simply by showing that P has superior economic
          resources.
        5. Shared interests of
          several states
          – directs concern to the risk of
          arbitrariness in allowing one forum to advance its public
          policies by adjudicating a case touching many states and
          implicating their public policies also.
        6. From Asahi
          foreign policy – “unique burdens placed upon one who must
          defend oneself in a foreign legal system”
      2. Qualifications to
        fairness factors:

        1. If minimum contacts are
          clearly found then D must present a “compelling case that the
          presence of [these factors] would render jurisdiction
          unreasonable.” Burger King
        2. If fairness factors
          are found, then the court is willing to fudge a bit on the
          minimum contacts. They can be REALLY LOW. “These
          considerations sometimes serve to establish the reasonableness of
          jurisdiction upon a lesser showing of minimum contacts than would
          otherwise be required.” Burger King
      3. No – The More
        Burdensome It Is For Defendant & the Slimmer the Contacts,
        More Likely It Is To Be Unreasonable –
        Asahi Metal
        Industry Co. v. Superior Court

        1. Rule: The
          defendant must purposefully avail himself of the forum by more
          than just putting a product into the stream of commerce with the
          expectation that it will reach the forum state, however, such
          conduct is enough to satisfy the minimum contacts requirement.
          Nonetheless, once it has been established that minimum contacts
          exist, the fairness requirement must still be met as well, which
          will be much harder to do in the case of a non-U.S. resident.
        2. Rationale: A
          consideration of the facts reveals the unreasonableness of an
          assertion of jurisdiction over Asahi, even apart from the
          question of the placement of goods in the stream of commerce.
          Considering the international context, the heavy burden on the
          alien defendant, the slight interests of the plaintiff and the
          forum state, the exercise of personal jurisdiction by a CA court
          over Asahi would be unreasonable and unfair.
      4. Yes – Burger
        King Corp. v. Rudzewicz

        1. Rule: Once
          it has been established that the defendant has minimum contacts
          with a state, it is up to the defendant to prove that being
          required to defend a suit there would be “fundamentally
          unfair”.
        2. Reasoning:
          Minimum contacts give the presumption of jurisdiction unless the
          fairness factors are so overwhelmingly in opposition to
          jurisdiction.
        3. Dissent: Stevens
          stresses due process concerns of the defendant rather than the
          forum state’s interest in the litigation.
      5. Are Fairness
        Factors Applicable in Cases of General Jurisdiction? Note Case:
        Metropolitan Life Insurance Co. v. Robertson-CECO Corp.

        1. The Second Circuit held
          that the exercise of general jurisdiction was unreasonable in
          light of the five-factor Asahi test, but other courts have
          not consistently applied this approach.
    8. Another Basis of
      Jurisdiction: Consent

      1. Waiver – Failing
        to raise an objection regarding jurisdiction either in your answer
        or to make a 12(h)(1) motion at the appropriate time.

        1. Insurance Corp.
          of Ireland v. Compagnie des Bauxites de Guinee

          1. Rule:
            Failure to comply with jurisdiction related discovery may
            constitute implied consent to jurisdiction.
          2. Rationale: By
            submitting to the jurisdiction of the court for the limited
            purpose of challenging jurisdiction, D agrees to abide by that
            court’s determination on the issue. P was seeking through
            discovery to respond to D’s contention that there was no
            personal jurisdiction. Having put the issue in question, D did
            not have the option of blocking reasonable attempt of P to meet
            its burden of proof.
      2. General
        Appearance
        – If D appears and presents defenses or
        objections other than those regarding jurisdiction, he has
        consented to personal jurisdiction.
      3. Counter-claim
        – If non-resident plaintiff is hit w/ counter claim he has
        consented to personal jurisdiction.
      4. Implied
        1. In doing business with
          the forum state, there is implied consent to personal
          jurisdiction in that state through the state’s long-arm
          statutes. This “fiction” of consenting to jurisdiction
          through business requires that the business have minimum contacts
          with the forum state (International Shoe). The state’s
          long-arm statute might authorize jurisdiction, however, the
          jurisdiction must also be Constitutional.
        2. Ratliff v.
          Cooper Labs., Inc.
          – “Applying for the privilege of
          doing business is one thing, but the actual exercise of that
          privilege is quite another. The principles of due process
          require a firmer foundation than mere compliance with state
          domestication statutes.”
      5. Express (Does
        not hold if contract is unconscionable or party under duress)

        1. M/S Bremen v.
          Zapata Off-Shore Co.

          1. Rule: The
            United States courts should enforce reasonable forum selection
            clauses even if the clause mandates jurisdiction in a foreign
            court.
          2. Rationale: “The
            expansion of American business and industry will hardly be
            encouraged if, notwithstanding solemn contracts, we insist on a
            parochial concept that all disputes must be resolved under our
            laws and in our courts. We cannot have trade and commerce in
            world markets and international waters exclusively on our terms,
            governed by our laws, and resolved in our courts.”
        2. Carnival
          Cruise Lines, Inc. v. Shute

          1. Rule:
            Reasonable forum selection clauses are effective in imposing
            jurisdiction.
          2. Rationale: 1)
            Cruise line has a special interest in limiting the for a in
            which it potentially could be subject; 2) the clause dispels any
            confusion about where suits arising from the contract must be
            brought and defended; 3) passengers benefit in the form of
            reduced fares reflecting the savings that the cruise line enjoys
            by limiting the for a in which it may be sued. It will be valid
            as long as the clause is reasonable. The clause is reasonable
            when it is fair. It is fair because the plaintiffs benefited
            from lower prices resulting from decreased litigation.
  4. Jurisdiction
    Over Property

    1. Two types of
      jurisdiction

      1. Quasi in rem: Cause
        of action isn’t necessarily about property. The property is
        attached to get jurisdiction. Requirements of quasi in rem
        jurisdiction are:

        1. Notice to person that
          you are taking property
        2. In the forum state
        3. That was attached at
          beginning of lawsuit
      2. In rem: Cause
        of action is about property.

        1. Has to deal with
          property.
        2. Has to be within
          the state.
        3. Against the universe (I
          exercise dominion over the chalk – anybody who wants to challenge
          the ownership of the chalk can come into the lawsuit. Anybody
          with interest in the chalk.)
      3. Tyler v.
        Judges of the Court of Registration

        1. Rule: Personal
          notice to all adverse claimants is not required in a motion in
          rem to quiet title to property.
        2. Rationale: In
          rem jurisdiction is secured by the power of the court over the
          property. Otherwise, the judicial proceeding to clear title
          against all the world would not be possible, for the very nature
          of the proceeding is to rid the property of any known or unknown
          claimants.
      4. Pennington v.
        Fourth National Bank

        1. In rem proceedings
          require seizure of the property within the forum state’s
          jurisdiction as well as an opportunity for the owner to be heard.
          Applies to both tangible and intangible property.
      5. Harris v. Balk

        1. Rule: Courts
          may assert jurisdiction over debts provided personal jurisdiction
          over the debtor can be attained.
        2. Rationale: The
          situs of the debt travels with the debtor for jurisdictional
          purposes. The original situs of the debt is irrelevant. Debt is
          an item of intangible personal property and the typical rules for
          in rem jurisdiction should apply.
        3. Note: After
          Shaffer, the attachment of a third party’s debt to D or
          attachment of an insurance company’s obligation to defend and
          pay a claim, are largely wiped out as bases for jurisdiction.
      6. No Minimum
        Contacts, Therefore No Quasi In Rem Jurisdiction – Shaffer v.
        Heitner

        1. Rule:
          Minimum contacts must exist in order for in rem jurisdiction to
          attach.
        2. Rationale: Since
          jurisdiction over property involves jurisdiction over a person’s
          interest in the property, the proper standard is the minimum
          contacts standard elucidated in International Shoe (due
          process requires that minimum contacts exist for in personam.
          jurisdiction). If a direct assertion of personal jurisdiction
          over the defendant would violate the Constitution, it would seem
          that an indirect assertion should be equally impermissible.
        3. Reasons against using
          the minimum contacts test (or to put it another way, reasons for
          allowing automatic quasi in rem jurisdiction)

          1. A wrongdoer
            “should not be able to avoid payment of his obligations by the
            expedient of removing his assets to a place where he is not
            subject to an in personam suit. Rebuttal by court: You
            can still sue where the money isn’t and use the Full Faith and
            Credit Clause to take your judgment to the state where the money
            is and execute the judgment.
          2. Traditional in rem
            jurisdiction avoids the uncertainty in the International Shoe
            standard and assure a plaintiff a forum. Rebuttal by court:
            The test is rather easy to apply. And, simplifying the
            question of jurisdiction is not more important than “fair play
            and substantial justice”
          3. This is the way it has
            always been, why change the tradition? Rebuttal by court:
            Just because it is the way it has always been doesn’t mean
            that it is fair.
          4. Sometimes this may be
            the only forum available this was not raised nor discussed in
            court.
        4. Effects of
          Shaffer

          1. Pure In Rem Actions
            Shaffer had almost no effect on in rem suits.
            Jurisdiction is permissible where the presence of property
            within the state is itself the subject matter of the
            dispute—where tangible or intangible—and is directly related
            to P’s cause of action.
          2. Quasi In Rem
            Actions
            – Quasi in rem will rarely be advantageous.
            Jurisdiction permissible where the P’s claims relate to rights
            and obligations arising out of the defendant’s ownership of
            property within forum state provided D has minimum contacts.
            The one situation where it might be useful is where minimum
            contacts are present, but the state’s long-arm statute for
            personal jurisdiction is too narrow to reach D.
      7. Owning Land
        Satisfies Minimum Contacts – Note Case: Rhoades v. Wright

        1. Court
          considered the presence of the land (as distinguished from the
          intangible prop. in Shaffer) together with the fact that
          the Colorado D actively used the land as sufficient

      8. Exception –
        Admiralty Cases – Note Case:
        Amoco Overseas Oil Co. v.
        Compagnie Nationale Algerienne de Navigation

        1. A federal admiralty
          court after Shaffer can exercise jurisdiction based on an
          attachment of property (foreign bank account) in the district
          when the defendant otherwise lacks contacts with the forum.
          “This tradition suggests not only that jurisdiction by
          attachment of property should be accorded special deference in
          the admiralty context, but also that maritime actors must
          reasonably expect to be sued where their property may be found.”
      9. Note Case: Feder
        v. Turkish Airlines

        1. Quasi in rem
          jurisdiction okay when attaching bank account that is only
          contact with forum. Decision not consistent with Shaffer.
      10. Note Case: Rush
        v. Savchuk

        1. Insurance obligation
          could not be attached to get quasi in rem jurisdiction because
          there were not enough contacts.
      11. Cybersquatting –
        Note Case:
        Harrods Ltd. V. Sixty Internet Domain Names

        1. Registering a domain
          name can expose D to an in rem action wherever the name is
          registered because states have a sovereign interest in protecting
          property registered within its borders if dispute is directly
          related to the property itself.

                  1. Jurisdictional
                    Reach of the Federal District Courts
    2. Rule 4(k)(1)(A):
      If the state court has jurisdiction, the federal court has
      jurisdiction. The federal court “borrows” the long-arm statute
      of the state court. Personal jurisdiction is valid in state court,
      and therefore federal court, when the state’s long-arm statute
      authorizes it and when it is constitutional.
    3. Rule 4(k)(1)(B):
      Personal jurisdiction valid over a third party in a lawsuit when
      that third party was served within a 100 mile radius (even across
      state lines) of the courthouse.
    4. Rule 4(k)(1)(C) and
      Rule 4(k)(1)(D): other long-arm statutes

      1. “Because the federal
        courts are federal, it is not about the state, it is about you
        being a citizen of the US in
        some instances, you can be served anywhere.” (Quote from Ben)
        For unusual cases:

        1. National Residence
          Theory:
          if you are a resident of the US, then it is up to the
          federal court where you are sued. It is automatically fair
          because you are a resident of the US, so the fairness factors are
          not considered
        2. National Contacts
          Theory
          : if you have contacts with the nation, then the
          federal court is going to be concerned with minimum contacts with
          the US and they will apply fairness factors.
    5. Rule 4(k)(2):
      allows federal courts to exercise jurisdiction over a defendant
      against whom federal law claims are asserted in a case in which the
      defendant is not subject to the jurisdiction of any single state
      but the Constitution of the US would permit jurisdiction (almost
      always because D is a foreigner).

      1. Rule 4(k)(2) promulgated
        partly in response to Omni Capital International v. Rudolf
        Wolff & Co.
        – Foreign defendants doing
        business in the US might not be amenable to service of process in
        any particular state if long arm-statute could not reach them and
        thus would be unaccountable in the US for alleged violations of
        federal law, but Supreme Court held that it was for legislature,
        not courts, to fashion a rule authorizing service of process in
        this situation.
    6. Which party has
      burden of proving the amenability or lack of amenability of the
      defendant to suit?

      1. Note Case: BP
        Chemicals v. Formosa Chemical Corp.

        1. Burden stays with
          plaintiff
      2. Note Case: US
        v Swiss American Bank

        1. Once P makes prima
          facie case for application of the rule, the burden shifts to
          defendant
      3. Note Case: ISI
        International v. Borden Ladner Gervais LLP

        1. Defendant who wants to
          stop Rule only has to name some other state. Naming a state would
          amount to consent to PJ. If defendant says he can’t be sued
          anywhere and doesn’t say where he can be sued, then Rule can be
          applied.
    7. How is nationwide
      in personam jurisdiction justified?

      1. Note Case:
        Stafford v. Briggs

        1. Justice
          Stewart-dissent: Theory of “national contacts”: Due Process
          Claus requires minimum contacts between defendant and sovereign
          that has created court.
      2. Note Case:
        Oxford First Corp. v. PNC Liquidating Corp. – Federal
        statutes authorizing extra-district service of process are limited
        by the fundamental notions of “fairness” derived from the Due
        Process Clause of the Fifth Amendment. The factors relevant to
        the “fairness” inquiry were: 1) the extent of the defendant’s
        contracts with the place where the action was brought, 2) the
        inconvenience of defending in a distant forum, 3) judicial
        economy, 4) the probably locus of discovery, 5) the interstate
        character and impact of defendant’s activities.

        1. Most courts have
          declined to adopt the Oxford factors as a test of whether
          an assertion of personal jurisdiction by a federal court complies
          with due process.
  5. Challenging A
    Court’s Exercise Of Jurisdiction Over The Person Or Property

    1. Raising the
      Jurisdictional Issue Directly

      1. In federal court and
        half of the states, if you defend on the merits, you do not waive
        personal jurisdiction. You can defend the lawsuit in federal
        court and half of the states on the merits and then on appeal, you
        can raise whatever issue you want, including lack of personal
        jurisdiction.
      2. The other half of
        the states have “special” and “general” appearances
      3. Special”
        appearances
        : D is appearing just to contest personal
        jurisdiction. If he loses, he can appeal. If the court decides
        that they do have jurisdiction, D can defend on the merits or
        default. If you defend on the merits and therefore make a
        “general” appearance and lose, you can appeal but not on the
        grounds that the court lacked jurisdiction.
      4. General”
        appearances
        : D consents to personal jurisdiction. If D
        defaults but does not make a general appearance, judgment will be
        entered against him and he can then collaterally attack.
      5. Trial Courts Have
        Broad Leeway In Determining Procedures –
        Data Disc, Inc.
        v. Systems Technology Associates, Inc.
        “A
        defendant may move, prior to trial, to dismiss the complaint for
        lack of personal jurisdiction…The limits which the district
        judge imposes on pre-trial proceedings will affect the burden
        which the plaintiff is required to meet…Accordingly, if a
        plaintiff’s proof is limited to written materials, it is
        necessary only for these materials to demonstrate facts which
        support a finding of jurisdiction in order to avoid a motion to
        dismiss. If a plaintiff makes such a showing, however, it does
        not necessarily mean that he may then go to trial on the
        merits…where the jurisdictional facts are enmeshed with the
        merits, the district court may decide that the plaintiff should
        not be required in a Rule 12(d) preliminary proceeding to meet the
        higher burden of proof which is associated with the presentation
        of evidence at a hearing, but rather should be required only to
        establish a prima facie showing of jurisdictional facts…(P) must
        still prove the jurisdictional facts at trial by a preponderance
        of the evidence.”
    2. Collateral Attack
      on Personal Jurisdiction

      1. When P tries to enforce
        the judgment, D can contest that the judgment was made without
        jurisdiction. The court does not have to give judgment full faith
        and credit. D can file lawsuit arguing that there is an invalid
        judgment based on lack of jurisdiction. The court can then
        invalidate the judgment.
      2. D can’t defend on
        the merits in State X and then collaterally attack in State Y –
        Baldwin v. Iowa State Traveling Men’s Ass’n
        – If defendant appears specially to contest personal
        jurisdiction in federal court, defendant cannot collaterally
        attack; he can only appeal or had he wanted to collaterally
        attack, he should not have shown up at all. “Public policy
        dictates that there be an end of litigation; that those who have
        contested an issue shall be bound by the result of that contest;
        and that matters once tried shall be considered forever settled as
        between parties…[this] opinion repeats the established rule that
        a defendant who makes no appearance whatsoever remains free to
        challenge a default judgment for want of personal jurisdiction.
        The principle that a court has power to determine its own personal
        jurisdiction is limited to defendants who submit the question for
        resolution in that court.”
    3. The
      Limited-Appearance Problem

      1. Limited”
        appearance:
        Allows D in an action commenced on a quasi-in rem
        basis to appear for the limited purpose of defending his interest
        in the attached property without submitting to the full in
        personam jurisdiction of the court.

        1. If D appears to
          defend in QIR action, then PJ –
          U.S. Industries, Inc.
          v. Gregg
          – FL resident whose property had been
          sequestered in DE was refused the right to make a limited
          appearance and told that any judgment the court might enter in
          favor of P would be an in personam one.
                  1. Providing
                    Notice and An Opportunity to Be Heard
  1. The Requirement of
    Reasonable Notice

    1. In order to have personal
      jurisdiction, it has to be authorized under the long arm statute,
      constitutional, and triggered by the service of process.
    2. Reasonableness test: In
      order for D to have received adequate notice, it is not necessary
      that he actually have learned of the suit. Rather, the procedures
      used to alert him must have been reasonably likely to inform him,
      even if they actually failed to do so.
    3. Due Process Requires
      Notice Be Reasonably Calculated Under All The Circumstances.

      1. Publication Fails
        When Addresses Known –
        Mullane v. Central Hanover Bank &
        Trust Co.

        1. Rule: Notice by
          publication fails to comply with due process where the names and
          addresses of the parties are known.
        2. Rationale:
          Whenever legal proceedings affect life, liberty, or property
          interest of the parties, parties must be provided with notice
          under due process clause. Due process requires that notice be
          reasonably calculated, under the circumstances”, to
          appraise interested parties of the pendency of the action and
          afford them the opportunity to be heard. Personal service of
          written notice always complies with due process; notice by
          publication fails as a reasonable method depending on the
          circumstances. However, parties residing outside of the forum
          state do not necessarily have to be provided with written notice,
          as this would place impossible obstacles in the instant action
          where the number of interested beneficiaries is numerous. P had
          previously mailed information to a number of beneficiaries and
          likewise should have mailed notice of the legal proceedings to
          these beneficiaries, as this would not seriously burden the
          trust. The New York statute providing for service by publication
          in such circumstances is unconstitutional, failing to comply with
          due process. With regard to the beneficiaries whose addresses
          were unknown or interests uncertain, notice by publication did
          comply with due process.
      2. Publication In
        Last Known Abode Not Good Enough – Note Case:
        McDonald
        v. Mabee

        1. “There is no
          dispute that service by publication does not warrant a personal
          judgment against a nonresident…an advertisement in a local
          newspaper is not sufficient notice to bind a person who has left
          a state intending not to return. To dispense with personal
          service the substitute that is most likely to reach the defendant
          is the least that ought to be required if substantial justice is
          to be done.”
      3. Notice of Implied
        Consent Laws
        Expressly Required To Non-Residents – Note
        Case:
        Wuchter v. Pizzutti

        1. Every implied consent
          statute should require the plaintiff to have the duty of
          communication by mail or otherwise with the defendant that he has
          been served. If the statute does not require the plaintiff the
          duty of communicating to defendant service, then even if
          defendant is given communication of service, jurisdiction may not
          be established.
      4. Posting On
        Property Not Good Enough
        (Mail Or Personal Service
        Required) – Note Case:
        Mennonite Board of Missions v.
        Adams

        1. Notice by
          publication and posting does not provide a mortgagee of real
          property with adequate notice of a proceeding to sell the
          mortgaged property for nonpayment of taxes. Publication and
          mail is needed unless mortgagee is not reasonable identifiable.
      5. For Probate If
        Creditors Are Known/Ascertainable Mail Required – Note Case:
        Tulsa Professional Collection Services, Inc. v. Pope

        1. US Supreme Court held
          that if Tulsa’s identity as a creditor was known or “reasonably
          ascertainable” by executrix Pope, due process required that the
          collection agency be given notice by mail or other such means as
          is certain to ensure actual notice.
      6. Notice On Door of
        Tennant for Eviction Not Enough – Note Case:
        Greene v.
        Lindsey

        1. Supreme Court, in
          an opinion by Brennan, found notice in the form of posting
          summons on door of a tenant’s apartment in forcible entry and
          detainer actions (provided for by Kentucky statute) insufficient
          to satisfy due process. In circumstances of this case, merely
          posting notice on apartment door does not satisfy minimum
          standards of due process because in a significant number of
          instances, the statute allowing service of process in this manner
          failed to provide actual notice to tenant concerned. Due process
          clause required that the posting be supplemented by notice
          through mail. Notice posted upon property is adequate to alert
          owner or occupant of legal proceedings where notice is posted at
          a residence but when there are circumstances different from those
          in the instant case.
        2. Dissent: Since
          mailboxes are subject to plunder, at least posting on door gets
          it as far as the tenant’s door.
      7. For
        Impossible/Impractical Personal Service Then Mail To Last Known
        Enough – Note Case:
        Dobkin v. Chapman

        1. Regarding personal
          service that is impossible or impractical, New York Court of
          Appeals upheld service by ordinary mail to defendant’s last
          known address and publication in a local newspaper.
      8. Mail To Insane Or
        Committed Not Enough – Note Case:
        Covey v. Town of
        Somers

        1. US Supreme Court
          held that notice by mail, ordinarily sufficient, does not satisfy
          due process when it is mailed to someone known to be insane and
          committed to a hospital, or to someone who is without the
          protection of a guardian.
      9. Actual Notice Not
        Required To Prisoner From Fed Gov –
        Note Case: Dusenberry
        v. United States

        1. Supreme Court held
          that certified mail is sufficient in those circumstances when the
          federal government is the plaintiff and the defendant is
          incarcerated in federal prison.
        2. Ginsburg, Stevens,
          Souter, and Breyer dissented because “the Court condones a
          procedure too lax to reliably ensure that a prisoner will receive
          a legal notice sent to him.”
      10. On Small Claims,
        Summons Must Include Option Of Written Pleading – Note Case:
        Aguchak v. Montgomery Ward Co.

        1. On small claims cases,
          summons must include notification that defendant has option to
          appear by written pleading or that defendant had a right to
          request change of venue otherwise jurisdiction is improper. This
          case distinguishes between what methods for communicating notice
          are acceptable (see cases above) and what the content of the
          notice should be.
      11. Notice of
        Garnishment Must Contain Detailed Individualized Explanation of
        Reasons For Action Being Taken – Note Case:
        Finberg v.
        Sullivan

        1. Third Circuit struck
          down rules allowing creditors to seize bank accounts containing
          Social Security benefits without giving notice containing a
          detailed, individualized explanation of the reason(s) for the
          action being taken.
  2. The Mechanics of
    Giving Notice

    1. Ways to Serve
      1. Serve pursuant to law
        of forum state
        , or pursuant to law of state where service is
        effected (state where served) / Rule 4(e)(1)
      2. Personal service
        – place and leave papers with defendant

        1. Place and Leave With
          – Personal Delivery on Natural Persons: “McKelway, Profiles –
          Place and Leave With”, New Yorker

          1. “Place and leave
            with’ is the legal phrase for what a process-server must do
            with a summons when goes out to serve papers on a defendant, but
            the courts never have explained precisely what that means.
            Where the process-server must place the papers is still a nice
            legal question.”
      3. Service on
        defendant’s dwelling or usual place of abode / Rule
        4(e)(2) if papers are left with person residing there of suitable
        age and ability to accept service

        1. Service To One Of
          Many Homes – Note Case: National Development Co. v. Triad
          Holding Corp.

          1. Service to apartment
            of wealthy businessman who testified it was one of 12 residences
            he maintained around the world was upheld because he was living
            there at the time and serving him there was the most likely
            method of ensuring that he received the summons and complaint.
        2. Service To Home
          You’ve Just Left
          Note Case: Karlsson
          v. Rabinowitz

          1. Fourth circuit
            validated service that was left with the defendant’s wife in
            Maryland even though the family was in the process of moving and
            the defendant had already left for Arizona, with no intent ever
            to return.
        3. Service to
          Estranged Wife Not Valid – Note Case: Williams v. Capital
          Transit Co.

          1. On facts similar to
            Karlsson, District of Columbia Circuit held that service was
            invalid because the papers were left with D’s estranged wife
            and he did not receive the papers until three years after
            judgment was entered against him.
      4. Service via
        registered mail or regular first class mail only allowed
        when forum state allows pursuant to Rule 4(e)(1)
      5. Waiver of service
        / Rule 4(d)

        1. Plaintiff sends
          defendant waiver; defendant accepts or refuses waiving formal
          service
        2. Receiving request to
          waive does not create obligation to respond or basis for default
        3. If defendant refuses
          waiver (without good reason), must pay cost of personal service –
          financial incentive to waive service.

          1. Reasons why
            defendant may refuse to sign waiver of service:
          2. Statute of limitations
            – Sometimes the statute of limitations does not run until the
            defendant is served.
          3. If the defendant
            thinks that he can constantly evade service, then the plaintiff
            cannot effectively serve defendant and will be unable to sue
            defendant.
          4. The defendant may just
            want to make it difficult on the plaintiff.
          5. The defendant may be
            rich and therefore willing to pay for alternative form of
            service in hopes that plaintiff will be unable to carry them
            out.
        4. If defendant
          accepts waiver, Rule 4(d)(3) allows 60 days to file answer –
          Rule 12(a) allows 20 days to answer if defendant does not waive
          service
        5. P Must Strictly
          Comply With Service Provisions, Even If D Knows Of Suit

          Maryland State Firemen’s Association v. Chaves

          1. Rule: The
            plaintiff must strictly comply with the service provisions, even
            if the defendant has actual notice of the lawsuit.
          2. Rationale: For
            cases pending after December 1, 1993, Rule 4(d) replaces Federal
            Rule 4(c)(2)(C)(ii). The new rule authorizes the defendant to
            send notice of the action and a request for waiver of service.
            If the defendant does not consent to waiving, the rule does not
            provide a basis for default judgment. Maryland rules do not even
            help their case because Maryland Rule of Procedure 2-121
            requires service by process of certified mail, not first class.
        6. Private Delivery
          (FedEx) Is NOT First Class Mail – Note Case:
          Audio
          Enterprises v. B & W Loudspeakers

          1. Seventh Circuit
            district court rejected service by private delivery, reasoning
            that Rule 4(d) specifies first class mail, postage prepaid.
      6. Service by posting
        on property or publication
        – only constitutional when no
        good alternatives exist; may be sufficient is do both or
        supplement either with mailing to last known address
      7. Service pursuant to
        some international treaty
        / Rule 4(f) – Hague convention
        prevails if a country has signed it
      8. Service via authorized
        agent
        . Agent may be authorized by appointment or by law. There
        must be evidence that defendant himself intended to confer such
        authority upon the agent.

        1. National
          Equipment Rental, Ltd. v. Szukhent

          1. Rule:
            Service upon an expressly designated agent is proper, even if
            the agent is not required to deliver notice to the defendant.
            An express contractual appointment of an agent for service of
            process, and the subsequent transmittal of notice to the
            defendant, satisfies the requirements of Rule 4(e)(2).
          2. Rationale:
            Parties to a contract may agree in advance to submit to the
            jurisdiction of a given court through a forum selection clause,
            expressly designating an agent in New York for the purpose of
            accepting service of process. Although the agent in this case
            was not known to the defendant, her prompt acceptance and
            transmittal of the summons and complaint was itself sufficient
            to validate agency, even though there was no explicit promise on
            her part to do so. A failure to deliver service may have
            invalidated the agency, but that is not the case here. Since
            prompt notice was given to the defendant, the agent was his
            “agent authorized by appointment” to receive process. It is
            because Florence, the “fake agent” (because defendant did
            not have subjective intent to make Florence the agent), acted
            like an agent that she is authorized as being the agent. The
            Supreme Court considers form contracts as valid, even if there
            may be a conflict of interest, if the agency is validated.
          3. Dissent: 4 justices
            say that she was not authorized, including Black and Brennan.
            They do not like that Florence had a conflict of interest in
            being appointed through contract clause; they would bar agents
            who have conflict of interest as a matter of law and who are
            therefore not really authorized by appointment. The only time
            they would accept someone like Florence as an agent is if she
            was required to validate the agency by mailing a copy, but she
            was not required to so by either federal or state law. They do
            not like form contracts, believing that it is not real
            authorization.
        2. Cognovit Notes
          Should be Decided On Case-by-Case Basis – Note Case:
          D.H.
          Overmeyer Co. v. Frick Co.

          1. The Supreme Court
            considered the constitutionality of cognovit provisions
            (provisions where debtor may agree to waive objections to
            jurisdiction, notice, and service of process) and ruled that
            they were not per se violative of the Due Process Clause. Such
            agreements must be judged on a case-by-case basis, with
            particular sensitivity to whether there was inequality of
            bargaining power or lack of consideration.
          2. Most state courts
            have invalidated cognovit notes and other “consent judgment”
            provisions. They are rarely employed outside of Pennsylvania,
            Delaware, Ohio, and Illinois.
      9. Rule 4(h) authorizes
        service upon corporations, partnerships, and unincorporated
        associations
        that are subject to suit under a common name,
        with the most frequently invoked portion of the rule being the
        part that permits service by delivery of process to an officer,
        managing agent, or general agent.

        1. Delivery to Someone
          NOT Authorized by Company –
          Insurance Co. of North
          America v. S/S “Hellenic Challenger”

          1. Rule:
            Federal Rule 4(h)(1) has been liberally construed to allow
            service upon any representative of a corporation when delivered
            to one so integrated with the organization that he knows what to
            do with the papers.
          2. Rationale:
            Service of process upon a corporation does not necessarily have
            to be made upon an expressly designated employee. Service is
            generally sufficient when made upon an individual who stands in
            such a position to render it fair to imply the authority on his
            part to receive service. In this case, the service was
            reasonably calculated to alert the defendant to the initiation
            of the suit because the claims adjuster who was served was well
            integrated into the organization and was familiar with the
            formalities associated with service, as he had accepted service
            on behalf of the defendant on at least two previous occasions.
            The adjuster’s loss of summons and complaint is a mistake in
            the ordinary course of business and does not merit remedial
            relief.
        2. Service to
          Secretary Can Be OK – Note Case:
          Fashion Page, Ltd. v.
          Zurich Ins. Co
          .

          1. “A corporation may
            assign the task of accepting process and may establish
            procedures for insuring that the papers are directed to those
            ultimately responsible for defending its interests. The
            corporation however cannot escape the consequences of
            establishing alternative procedures which it may prefer.
            Reliance may be based on the corporate employees to identify the
            proper person to accept service.” In this case, an executive
            secretary who had regularly accepted summonses whenever the vice
            president was not in his office was considered an “agent
            authorized by appointment”.
      10. If D’s identity or
        residence is unknown, some states allow service by newspaper
        publication
        . But this may only be used where D truly cannot be
        found by reasonable effort.
    2. Return of Service
      1. After serving, server
        must file proof of service (affidavit detailing service and signed
        by server) to establish jurisdiction.
      2. Return of service can be
        rebutted if there is not absolute proof that service occurred.
      3. Sheriff Made a False
        Return of Summons –
        Miedreich v. Lauenstein

        1. The sheriff had
          made a false return of summons that resulted in judgment against
          plaintiff in this case. The Supreme Court upheld the judgment,
          stating that the plaintiff in the prior suit that the current
          plaintiff lost “did all that the law required in the issue of
          and attempt to serve process; and, without fraud or collusion,
          the sheriff made a return to the court that service had been duly
          made…the court was justified in acting upon such return as upon
          a true return. If the return is false the law of the state
          permitted a recovery against the sheriff upon his bond.” (Quote
          from Civ Pro book, p. 219)
      4. The return of
        service is considered strong evidence of facts stated, but it is
        not conclusive and may be controverted by proof that return is
        inaccurate. However, D’s testimony generally will not be
        sufficient to impeach the return unless other evidence
        corroborates it.
      5. Sewer Service –
        United States v. Brand Jewelers, Inc.

        1. The US had standing to
          seek an injunction preventing defendant from systematically
          obtaining default judgments against economically disadvantaged
          people by utilizing so-called ‘sewer’ service techniques, by
          which process-server simply disposes of the papers and makes a
          false affidavit of service.
    3. Service of Process
      and Statutes of Limitations

      1. Statutes of limitations
        fix specific times within which actions must be brought. A suit
        is “commenced” for purposes of a statute of limitations, in
        some states, when process is served on the defendant.

        1. Accrue & Toll:
          Causes of actions are said to “accrue” when the limitation
          clock begins to run on an action. If a plaintiff has been
          prevented from timely asserting her rights, the running of the
          clock is suspended or “tolled”.
      2. Statutes are
        generally deemed “procedural” but their impact is
        substantive” – plaintiff loses the opportunity to
        invoke the assistance of the courts to obtain relief for an
        otherwise valid claim.
      3. Defect in Service:
        A defect in service can be fatal to a plaintiff’s claim, because
        the statute of limitations may have run before the plaintiff has a
        chance to correct his error.
      4. In federal court, Rule
        3
        governs when the action is commenced.

        1. The suit is commenced
          when a copy of the complaint is filed with the district court.
        2. When the underlying
          cause of action is based on state law, state law will govern when
          the action is commenced.
      5. Rule 4(m)
        requires federal court to dismiss without prejudice an action when
        the defendant has not been served within 120 days of the filing of
        the complaint, if the plaintiff fails to show “good cause” for
        not completing service within that time.

        1. Prompt, but Improper
          Service in Federal Court
          : If service of process is promptly
          attempted but improperly made, the federal court has
          discretion
          over whether or not they will dismiss the action
          without prejudice or merely quash service and order the plaintiff
          to re-serve. Courts dismiss when plaintiff has little likelihood
          of effecting proper service. When plaintiff can make proper
          service quickly, courts generally quash the faulty service
          without prejudice to the plaintiff to serve again.
  3. Immunity from
    Process and Etiquette of Service

    1. Immunity from Process
      1. A court will sometimes
        immunize a party from service of process, despite the fact that
        the constitutional and statutory conditions governing personal
        jurisdiction and service of process have been met. In such cases,
        the grant of immunity usually is justified as promoting the
        administration of justice.

        1. Parties who are usually
          immune include witnesses, parties, and lawyers who come to state
          to participate in suit in order to alleviate fear of coming in
          state for suit
        2. Non-residents
          incarcerated for criminal charges are not immune from service for
          civil charges
        3. State ex rel.
          Sivnksty v. Duffield

          1. Rule:
            Nonresidents confined in jail on criminal charges are not immune
            from service of process for civil actions.
          2. Rationale: When
            the intended recipient of civil process has been charged with a
            crime, immunity furthers public policy to ensure that a
            nonresident charged with a crime will not be deterred from
            appearing before the criminal court by the threat of civil
            process. (“Chill of Appearance”) A nonresident who
            voluntarily submits himself to jurisdiction, in an answer to an
            indictment against him, is privileged while attending court from
            service of process in a civil suit. In the instant case, the
            defendant entered the jurisdiction on his own volition rather
            than in response to criminal process and at the time of entry,
            he had not yet committed a crime. In such instances, the court
            follows the rule that a person confined in jail on a criminal
            charge or imprisoned on conviction for such charge is subject to
            service of civil process if he was voluntarily in the
            jurisdiction at the time of the arrest and confinement.
          3. Dissent:
            Whether defendant came into jurisdiction voluntarily or not is
            irrelevant. His presence became involuntary when he was
            confined in jail and because of the majority opinion, he will be
            forced to trial in a county far from his residence. The holding
            in this case subjects to civil jurisdiction an unfortunate
            motorist who is arrested on real or fanciful criminal charges,
            potentially leading to widespread abuse of judicial process.
        4. Immunity From
          Service Confined to United Nations Headquarters District – Note
          Case:
          Kadic v. Karadzic

          1. President of breakaway
            Bosnian-Serb republic was served for federal court action on
            charges of genocide while he was in US as an invitee of the
            United Nations. Court upheld service and found that immunity
            from service is confined to the headquarters district of the
            United Nations and D was served in the lobby of a hotel, outside
            that district. The court also declined to treat D as an
            accredited diplomatic envoy because he was not a designated
            representative, only an invitee, of the United Nations.
      2. Today, immunity
        serves little purpose as long-arm statutes allow out of state
        service
    2. Etiquette of
      Service

      1. Service Gained By
        Fraud And Deceit Not Valid –
        Wyman v. Newhouse

        1. Rule:
          Service of process procured through trickery renders jurisdiction
          invalid. A judgment that is procured through fraud is void.
        2. Rationale:
          Defendant was fraudulently induced to enter jurisdiction of state
          of Florida to be served in an action for damages. Any judgment,
          procured fraudulently, lacks jurisdiction and is null and void.
          “A fraud affecting the jurisdiction is equivalent to a lack of
          jurisdiction.” Defendant did not have to make out a defense on
          the merits to the suit in Florida and any error made in entering
          judgment against a party over whom a court had no jurisdiction
          permits the defendant to attack the judgment collaterally.
      2. Service Gained By
        Trickery, But D In FS Voluntarily Is OK –
        Gumperz v.
        Hofmann

        1. The court
          distinguished between actions designed to induce a party into a
          jurisdiction and actions calculated to facilitate service on a
          party already in the jurisdiction, upholding service obtained by
          trickery on party who was voluntarily in New York. The trickery
          did not leave to quashing of service because it was only used to
          enforce the duty of the party to accept service of process.
      3. Today, issues of
        trickery are rare as long-arm statutes allow out of state service.
  4. Opportunity to Be
    Heard

    1. Due Process allows all
      parties the right to present their side of the case

    2. Sometimes a hearing
      is sufficient. Sometimes there is need for a full trial. It is
      usually something in between.
    3. Defendant must be given
      adequate time to prepare defense against charges in complaint

      1. Rule 12(a) provides
        20 days / Rule 4(d) provides 60 days if accept waiver
      2. 5 Days Was NOT Enough
        Time –
        Roller v. Holly

        1. One common requirement
          for a defendant to have adequate opportunity to be heard (when
          she is able to develop facts and legal issues in the case) is
          that the defendant must be informed of the action (that is, must
          receive notice) long enough in advance of the time when she is
          required to respond so as to allow her to obtain counsel and
          prepare a defense.
    4. Provisional
      remedies – a generic term for any temporary order of a court to
      protect a party from irreparable damage while a lawsuit or petition
      is pending.

      1. Due Process
        limits provisional remedies because they do not provide adequate
        opportunity to be heard.

      2. In general, seizure
        of property must be preceded by notice and opportunity to be
        heard.
      3. Must Consider
        Nature of P’s Interest – Note Case:
        Goldberg v.
        Kelly

        1. Court held that a
          pre-termination hearing is required for termination of welfare
          benefits because “termination of aid pending resolution of a
          controversy over eligibility may deprive an eligible recipient of
          the very means by which to live while he waits.”
      4. Can’t Garnish
        Wages W/out Hearing – Note Case:
        Sniadach v. Family
        Finance Corp.

        1. Struck down a
          Wisconsin prejudgment wage garnishment procedure as violative of
          due process guarantees. Where the taking of one’s property is
          so obvious, it needs no extended argument to conclude that absent
          notice and a prior hearing, this prejudgment garnishment
          procedure violates the fundamental principles of due process.
      5. Fuentes v.
        Shevin

        1. Rule: Absent
          extraordinary circumstances, notice and an opportunity to be
          heard must be provided PRIOR to depriving a party of a protected
          property interest. Consistent with procedural due process, we
          have repeatedly held that, prior to depriving a party of a
          property interest, an opportunity to be heard must be granted in
          a meaningful time.
        2. Reasoning of
          Majority 4
          (2 new judges on sidelines who had just been
          confirmed and that did not vote): Stewart: If notice and a
          hearing is to serve its full purpose, then the hearing must be
          granted at a time when the deprivation can still be prevented.
          Florida statute requires a post-seizure hearing in which
          the aggrieved party can argue her right to the goods.
          Pennsylvania allows for the aggrieved party to institute a
          lawsuit
          for the return of wrongfully seized goods. Pursuant
          to both statutes, the creditor seeking replevin (modern action
          allowing the title holder to repossess goods or chattels from a
          person who has wrongfully there must be a special need for prompt
          action, and the statute must be narrowly drawn.
        3. Dissent of
          Minority 3:
          Both the Florida and Pennsylvania statutes that
          allow for seizure of goods without providing opportunity to be
          heard prior to seizure are constitutionally valid methods of
          reconciling conflicting interests of the debtor and the creditor
          in an installment sales contract.
      6. Cognovit Notes
        Still OK – Note Case:
        D.H. Overmeyer Co. v. Frick

        1. Court held that a
          clause authorizing a creditor upon default to use a
          confession-of-judgment procedure (cognovit note) and secure the
          entry of judgment against a debtor without service of process or
          notice was not per se violative of the Fourteenth Amendment
          requirements of prejudgment notice and a hearing.
      7. Unequal
        Bargaining Leads to Invalid Waivers of Pre-seizure Hearings –
        Note Case:
        Kosches v. Nichols

        1. In contracts of
          adhesion where buyer has no alternative but to purchase on
          credit, the parties are not in equal bargaining position the
          clauses giving the seller the right to enter a debtor’s
          residence and seize the goods without a court order are
          unconscionable.
      8. Safeguards Make
        Seizures OK
        Mitchell v. W.T. Grant Co.

        1. Rule:
          Statutes allowing for attachment or sequestration without a prior
          adversarial hearing do not violate procedural due process, if
          procedural safeguards exist. The Louisiana sequestration statute
          does not violate due process.
        2. Rationale (2 new
          judges in!) Majority 5 (White, who dissented in Fuentes
          wrote majority opinion here): The Louisiana sequestration statute
          provides that a writ of execution could issue ex parte, but only
          when the nature of the claim clearly appears from a 1)
          verified petition
          . The statute required the clear showing to
          be 2) made to a judge and 3) allowed the debtor to seek
          dissolution of the writ
          , and then placed the burden on the
          creditor to prove that the writ was proper. 4) The debtor
          could regain possession by filing his own bond to protect the
          creditor against interim damage to the property.
          Sniadach
          and Fuentes differentiated from instant case, those cases
          involving a creditor with no prior interest in the property (not
          the case here with installment sales contract) and a sufficiently
          different factual and legal background from the instant case (not
          really!), respectively. Also, different from Fuentes, the
          statute in question here is narrowly confined. Based on the
          procedural safeguards of the Louisiana statute, there is far less
          danger here that the seizure will be mistaken, thus the
          sequestration standards are constitutional. Note that according
          to Martin, the majority does not overrule Fuentes – the
          distinguishing characteristics noted in Mitchell matter to the
          court.
        3. Dissent 4 (the same 4
          that were in the majority in Fuentes): The Louisiana
          affidavit requirement was little more than a standardized form
          that only tested the creditor-applicant’s own belief in his
          rights. Replacing the court clerk with a judge would have no
          effect on the assessment of the affidavit or the issuance of the
          writ. The factual issues in the instant case were no different
          from those in Fuentes. The majority unjustifiably
          disregarded stare decisis in overruling Fuentes
      9. Property May Not
        Be Attached W/out Notice/Hearing W/out Procedural Safeguards –
        North Georgia Finishing, Inc. v. Di-Chem, Inc.

        1. Rule: In
          order to comply with procedural due process, attachment by
          garnishment requires a prior adversarial hearing or certain
          procedural safeguards. The Georgia garnishment statute violates
          due process.
        2. Reasoning Majority 6
          (White, who handed down opinion of Mitchell one year
          before): The Georgia garnishment statute at issue provided for
          attachment of property upon filing an affidavit, without
          need to specify clear proof of need for attachment, with a court
          clerk (not a judge) and posting a bond equal to
          twice the amount alleged to be due. No provision for early
          hearing at which the creditor would be required to demonstrate
          probable cause for the garnishment. A writ of garnishment issued
          by a court clerk without notice or opportunity for an early
          hearing violates due process (Fuentes). The Georgia
          statute has none of the procedural safeguards necessary to make
          it constitutional (Mitchell). Although the property here
          (bank account) is different from that of the two preceding cases,
          the court does not distinguish among different kinds of property
          in apply the due process clause.
      10. Balancing Test –
        Connecticut v. Doehr

        1. Rule: Where the
          risk of erroneous attachment and the harm to the aggrieved party
          outweighs the interests of the party seeking attachment, property
          cannot be attached without notice and a hearing. Connecticut’s
          prejudgment attachment statute violates due process.
        2. Rationale (White
          again delivers this opinion and all justices agree!): The court
          relies on the form of the balancing test adopted in Mathew v.
          Eldridge
          – threefold inquiry to determine if government
          conduct comports with due process. The relevant inquiries in the
          instant case are as follows:
        3. Consideration of the
          private interest that will be affected by attachment

          1. The private property
            interests are significant, for attachment may cloud title,
            impair the ability to alienate the property, taint credit
            rating, and even place existing mortgage on default.
        4. Examination of
          the risk of erroneous deprivation through the statutory
          procedures and the value of additional alternative safeguards.

          1. There is a substantial
            risk of erroneous deprivation
          2. The Connecticut
            statute requires only a minimal showing of probable cause
          3. Judge could not make a
            realistic assessment of the merits of the action based solely on
            one-sided, conclusory assertions by defendant in an assault and
            battery action
          4. The statute does
            not provide sufficient additional safeguards
          5. It does provide for a
            prompt post-attachment hearing, but this would not cure
            the temporary deprivation of property that would have already
            occurred
        5. The interest of
          the party seeking the prejudgment remedy

          1. The interests of the
            defendant are too minimal to support the prejudgment attachment
          2. No indication that
            plaintiff was about to transfer his property or otherwise render
            his estate unavailable to satisfy a future judgment
          3. The court also
            provided an analysis of whether due process requires the party
            seeking attachment to post a bond. The bond, despite its
            use as remedy, does not excuse the need for a hearing or other
            safeguards prior to attachment. The bond cannot undo what
            hearings can prevent.
      11. Fed Can’t Evict
        Drug Dealers W/out Notice/Heard – Note Case:
        Richmond
        Tenants Organization, Inc. v. Kemp

        1. The court concluded
          that, in the absence of exigent circumstances, the Due Process
          Clause of the Fifth Amendment requires the federal government to
          provide notice and an opportunity to be heard before a tenant may
          be evicted, even when evicting drug offenders.
      12. Owner’s
        Interest In Property May Be Forfeited Even If She Did Not Know It
        Was Being Used For Illegal Purpose – Note Case:
        Bennis
        v. Michigan

        1. Court forfeited a
          family’s automobile following husband’s use of the car for
          sex acts with a prostitute. Wife tried to contest forfeiture on
          grounds of her joint ownership in the property, but court
          rejected that argument, holding that “a long and unbroken line
          of cases holds that an owner’s interest in property may be
          forfeited by reason of the use to which the property is put even
          though the owner did not know that it was put to such use.”
      13. Your Car Can Be
        Booted – Note Case:
        Patterson v. Cronin

        1. “Denver boot”
          case. Court applied Mathews factors and “found that the
          governmental interest in enforcing parking ordinances was
          important enough that a hearing prior to immobilization was not
          constitutionally mandated – provided that a hearing procedure
          was available after the immobilization. Denver failed to provide
          such a post-deprivation hearing and, as a result, the court
          concluded that the immobilization of plaintiff’s vehicle
          violated his due process rights.”
      14. Note Case:
        Shaumyan v. O’Neill

        1. Involved a challenge to
          the same statute at issue in Doehr, but in the context of
          a contract action, not an international tort case. It concerned a
          dispute between a homeowner and a repair contractor. Owner was
          not happy with quality of work and refused to pay, so contractor
          obtained an ex parte judgment attachment writ against their home.
          Owners sued to enjoin application of the attachment statute.
          Relying on the Mathews test, the court found that although
          the private interest in a family home is strong, the likelihood
          of erroneous deprivation is low and the contractor had a
          substantial interest in the property that resulted from his labor
          and the use of material that could not be reclaimed.
      15. Note Case:
        Peralta v. Heights Medical Center, Inc.

        1. Supreme Court held that
          requiring a party seeking to vacate a judgment to show a
          meritorious defense violated the Due Process Clause. Had
          defendant known of the lawsuit before default judgment entered
          against him (failure to personally serve him), might have turned
          out differently. Also, the entry of judgment against him had
          serious consequences, as it became a lien on his property, which
          was promptly sold. The judgment against him and the ensuing
          consequences occurred without notice and notice at a meaningful
          time and in a meaningful manner would have given him the
          opportunity to be heard.
    5. Temporary
      Restraining Orders Don’t Need Notice/Hearing
      – Federal Rule
      65(b) authorizes issuance of temporary restraining orders without
      notice or hearing, effective for 10 days during which time a
      hearing may be held to determine whether or not a preliminary
      injunction should issue. If a preliminary injunction is granted,
      it remains in effect until final judgment is rendered.

Subject
Matter Jurisdiction

  1. Subject Matter
    Jurisdiction in State Courts

    1. State courts are courts
      of general jurisdiction (open to hear all types of disputes). State
      courts often have different branches (probate, family law,
      criminal…civil (superior, municipal < $25,000, small claims
      court, etc.)).
    2. State Courts hears four
      different types of disputes:

      1. Lawsuits according
        to the law of the forum state.
      2. Lawsuits that arise
        under and are decided according to the law of a different state.
        (State cannot decline to hear violations of other states’ laws
        because of Article IV of the Constitution (Full Faith and Credit
        Clause).)
      3. Lawsuits that apply
        Federal law. (Can preempt state law.)
      4. Lawsuits that are
        decided according to the law of a different nation. (Not very
        common.)
  2. Subject Matter
    Jurisdiction in Federal Courts
    Diversity Jurisdiction

    1. Article III, § 2 and
      28 U.S.C. §§ 1332, 1359 in the Supplement: Federal courts can
      only hear the following types of cases according to § 2:

      1. Cases that arise under
        the Constitution because you are claiming that a state statute is
        unconstitutional…
      2. Cases that arise under
        the law of the US or any treatise made under their authority –
        federal laws or federal treatise…

        1. 1 and 2 are “arising
          under”
          jurisdiction
      3. Cases involving the
        following: ambassador, maritime, admiralty, controversy to which
        US is a party, neutral forum – controversies between two or more
        states, controversies between a state and citizens of another
        state, controversies between citizens of different states, between
        state citizens and foreign country or foreign country’s citizen
      4. Lawsuits missing
        from federal court are those between citizens of one state and
        citizens of that same state. These suits cannot be heard in
        federal court even if Congress wants them to (unconstitutional
        grant of subject matter jurisdiction)

        1. Strawbridge v.
          Curtiss
          – complete diversity needed
        2. Bank of the
          United States v. Deveaux
          – diversity jurisdiction to
          protect out of state litigants against local prejudice and to
          help speed economic growth
      5. Arguments
        Diversity Jurisdiction

        1. The congestion
          diversity cases allegedly causes in the federal courts
        2. Rule of Erie
          Railroad Co. v. Tompkins
          which requires the application of
          state law to substantive issues in diversity cases, has been
          thought by many to make handling of diversity cases by federal
          judges unnecessary, wasteful, and inappropriate

          1. Reasoning: only
            the state courts are considered to be authoritative on matters
            of substantive law and the federal courts therefore are unable
            to exercise their creative function and are performing an
            unneeded service in avowedly aiming to follow state-court
            decisions
        3. Judicial and
          legislative authority should be coextensive, and for federal
          courts to decide cases arising under state law is an undesirable
          interference with state autonomy
        4. The effect that
          diversion of litigation to federal courts may have in retarding
          the development of state law
        5. The continuation of
          diversity jurisdiction diminishes the incentives for state court
          reform by those influential professional groups who, by virtue of
          diversity jurisdiction, are able to avoid litigation in the state
          courts
      6. Defense of
        Diversity Jurisdiction

        1. Fear that state courts
          would be prejudiced against out-of-state parties
        2. Diversity jurisdiction
          is necessary in order to implement the constitutional guarantee
          that the citizens of each state shall be entitled to all the
          privileges and immunities of citizens of the several states
        3. The federal courts
          qualitatively are so superior to the state courts that it is
          desirable to channel as many cases as possible to the federal
          courts, or at least that out-of-state litigants, who have no
          opportunity to work for the improvement of the state courts,
          should be spared exposure to them; federal judges are appointed 
          not as susceptible to political pressure and local biases as
          state judges
        4. The existence of
          concurrent state and federal jurisdiction creates a competition
          between the two that acts as a spur to higher standards of
          justice in each court system
        5. The choice of forum
          undoubtedly will be utilized for tactical purposes but it is more
          an abuse of concurrent jurisdiction than an argument for the
          retention of diversity jurisdiction
        6. Interaction between
          state and federal courts that results from the existence of
          concurrent jurisdiction in areas of substantive law practiced by
          substantial segments of the bar has resulted in improvements in
          the procedures followed by both state and federal courts
        7. A fear on the part of
          investors that local prejudice may exist provides a justification
          for diversity jurisdiction
      7. New Developments
        1. The current debate
          about diversity jurisdiction focuses on whether a federal forum
          should be available to hear complex, multi-claim lawsuits that
          are based on state law but involve national concerns and multiple
          parties who reside in multiple states.
        2. Others see a shift of
          tort cases from the state to federal courts, where they will be
          decided by unelected judges, as posing a dilemma of
          “federalization” that raises important issues of federalism
          and separation of powers.
        3. Still others see a
          change in jurisdictional rules as a smokescreen for substantive
          choices that are likely to disadvantage plaintiffs.
        4. Yet another group
          recognizes special problems of multi-state class actions, in
          which the law of a single state can “bind the nation.”
        5. Finally, some critics
          emphasize the fact that enlarging the scope of diversity
          jurisdiction will generate increased costs to both the state and
          federal systems.
        6. In 2002 and 2005,
          Congress enacted two statutes that expand the reach of diversity
          jurisdiction and make a federal forum available for particular
          kinds of large scale, state law tort actions.

          1. 28 U.S.C. § 1369
            authorizes original federal jurisdiction in any civil action
            arising “from a single accident, where at least 75 natural
            persons have died in the accident at a discrete location”
            provided “minimal diversity exists between adverse parties.”
          2. 28 U.S.C. § 1332
            makes federal district courts available for any class action in
            which the amount in controversy exceeds $5 million and in which
            any defendant “is a citizen of a State different from any
            defendant.”
    2. Determining
      Citizenship

      1. US Citizen –
        Domicile –
        Mas v. Perry

        1. Rule: For
          purposes of federal diversity jurisdiction, a party changes
          domicile only by taking up residence in another state with the
          intention to remain there, and a wife’s domicile is not
          necessarily deemed to be that of her husband.
        2. Rationale: The
          court equates citizenship with domicile for purposes of diversity
          jurisdiction but distinguishes domicile from residence.
        3. In 1988, Congress
          amended Section 1332(a) to provide that for the purpose of
          diversity jurisdiction “an alien admitted to the US for
          permanent residence shall be deemed a citizen of the State in
          which such alien is domiciled.
      2. Person Descended
        From African Slaves Cannot be US Citizen – Note Case:
        Dred
        Scott v. Sanford

        1. Supreme Court held that
          an individual challenging his enslavement could not invoke
          diversity jurisdiction because a person descended from African
          slaves could not be a US citizen.
        2. Citizenship Clause
          of the 14th Amendment overrules this holding.
      3. Corporation Can
        Be A Citizen Of More Than One State – Note Case:
        White
        v. Halstead Industries, Inc.

        1. The state(s) in which
          it is incorporated
        2. The state in which it
          has its principal place of business
        3. The Circuit Courts of
          Appeals uses three different tests to determine a corporation’s
          principal place of business:

          1. The “nerve center”
            test – “the locus of corporate decision-making authority and
            overall control constitutes a corporation’s principal place of
            business for diversity purposes.”
          2. The “corporate
            activities” or “operating assets” test – greater weight
            is attached to the location of a corporation’s production or
            service activities in determining the principal place of
            business for diversity purposes.
          3. The “total activity”
            test – hybrid of the “nerve center” and “corporate
            activities” tests and considers all the circumstances
            surrounding a corporation’s business to discern its principal
            place of business. This “test provides a realistic, flexible
            and non-formalistic approach to determining a corporation’s
            principal place of business through a balancing of all relevant
            factors.”
          4. Partnerships
            An incorporated association is not treated as a citizen for
            purposes of federal diversity jurisdiction, but instead courts
            consider the citizen of each of its members. They are deemed to
            be citizens in every state in which they have a member. See
            Carden v. Arkoma Associates (1990).
      4. Courts disagree on
        whether Section 1332(a) authorizes jurisdiction over a suit
        between an alien plaintiff and an alien defendant.

        1. Note Case: Singh
          v. Daimler-Benz

          1. Court of Appeals held
            that jurisdiction under Section 1332 was available in a
            state-law action by a permanent resident alien residing in VA
            against a non-resident alien and citizen of state other than VA,
            reading the 1988 amendment to apply to actions under Section
            1332(a)(3).
        2. Note Case: China
          Nuclear Energy Indus. Corp. v. Andersen, LLP

          1. District Court held
            that Section 1332(a) does not permit an alien corporation to sue
            a partnership made up of both US citizens and permanent resident
            aliens; a partnership’s citizenship is determined by the
            citizenship of each of its individual partners. The court
            interpreted Section 1332(a) to adhere to the longstanding rule
            that there must be complete diversity between each plaintiff and
            each defendant, even in alienage cases.
        3. Diversity is Not
          Destroyed By Presence of Aliens on Both Sides of Controversy From
          Same Foreign Nation – Note Case:
          Tango Music, LLC v.
          Deadquick Music, Inc.

          1. Court gave Section
            1332(a) a literal reading and said it would make no difference
            to a court whether both parties were from the same foreign
            nation because diversity would be unaffected. An Illinois court
            would be biased in favor of an Illinois plaintiff and it would
            hardly matter to that court whether there was a French
            co-plaintiff and French co-defendant, since their citizenship
            would not weigh with that court.
      5. Citizens of
        Overseas Territories are Citizens of a Foreign State Under
        1332(a)(2) – Note Case:
        JPMorgan Chase Bank v. Traffic
        Stream Infrastructure Limited

        1. The Supreme Court
          explained that alienage jurisdiction was enacted in order to deal
          with the “penchant of the state courts to disrupt international
          relations and to discourage foreign investment.”

          1. Alienage jurisdiction
            exists where there is a suit between citizens of a state, on one
            side, and foreign states or citizens thereof, on the other.
      6. No Diversity for
        Stateless Alien – Note Case:
        Blair Holdings Corp. v.
        Rubinstein

        1. The court
          interpreted Section 1332(a)(2) to require a showing that the
          defendant was a citizen of a foreign state.
      7. You Can’t
        Improperly Create Diversity – Note Case:
        Kramer v.
        Caribbean Mills, Inc.

        1. Plaintiff attempted
          to create diversity of citizenship to have case heard in federal
          court. The Supreme Court affirmed the Court of Appeals holding
          that diversity was “improperly or collusively made” within
          the meaning of Section 1359. Section 1359 prohibits only
          the creation of diversity jurisdiction and says nothing about its
          destruction.
      8. Guardians and
        Executors – In 1988, Congress added to Section 1332(c) a
        provision that “the legal representative of the estate of a
        decedent shall be deemed to be a citizen only of the same State as
        the decedent, and the legal representative of an infant or
        incompetent shall be deemed to be a citizen only of the same State
        as the infant or incompetent.” This is a rule that prevented
        the appoint of administrators to create (or destroy) diversity.
      9. Real v. Nominal
        Parties – Note Case:
        Rose v. Giamatti

        1. P attempted to destroy
          diversity of citizenship to make removal to federal court
          impossible for the D. The District Court noted that a federal
          court in its determination of whether there is diversity of
          citizenship between the parties must disregard nominal or formal
          parties to the action, and determine jurisdiction based solely
          upon the citizenship of the real parties to the
          controversy. A real party in interest defendant is one
          who, by the substantive law, has the duty sought to be enforced
          or enjoined. A formal or nominal party is one who, in a
          genuine legal sense, has no interest in the result of the suit or
          no actual interest or control over the subject matter of the
          litigation.
    3. Amount in
      Controversy

      1. Good Faith Estimate
        Is Sufficient –
        A.F.A. Tours, Inc. v. Whitchurch

        1. Rule: The
          amount-in-controversy requirement for federal diversity
          jurisdiction is satisfied if the plaintiff makes a good-faith
          estimate that the value of the claims, including actual and
          punitive damages and the value of injunctive relief, meets the
          required amount.
        2. Rationale:
          Dismissal for failure to meet the amount is warranted only where
          it appears to a legal certainty that the claim is really for less
          than the jurisdictional amount. The amount may be measured
          either by a plaintiff’s losses or by profits unjustly received
          by the defendant. The demand for appropriate punitive damages
          may be included as well. Where an injunction is sought, the
          value of the claim is assessed by measuring the extent of
          impairment, including both past losses and future harm, to be
          prevented by the injunction.
      2. Test For
        Determining Whether P Has Met Amount In Controversy Requirement –
        Note Case:
        St. Paul Mercury Indemnity Co. v. Red Cab Co.

        1. The rule is that the
          sum claimed by P controls if it is apparently made in good faith.
          It must appear to a legal certainty that the claim is really for
          less than the jurisdictional amount to justify dismissal.
      3. Eventual recovery
        irrelevant
        : The fact that P eventually recovers far less than
        the jurisdictional amount does not be itself render the verdict
        subject to reversal and dismissal on appeal for lack of
        jurisdiction.
      4. Post Filing Events
        Relevant – Note Case:
        Hall v. Earthlink Network, Inc.

        1. Court said that it will
          look to post-filing events when they suggest that the amount in
          controversy allegation in the complaint was made in bad faith or
          that the complaint contained a mistake.
      5. Aggregation”
        doctrine – Note Case:
        Arnold v. Troccoli

        1. The rule that
          precludes a party from totaling all claims for purposes of
          meeting the minimum amount necessary to give rise to federal
          diversity jurisdiction under the amount-in-controversy rule.
      6. In general, single
        plaintiffs can aggregate claims against single defendants.
        However, a single plaintiff who has aggregated his claim against a
        particular defendant usually may not join claims against other
        defendants for less than the jurisdictional amount.
      7. Two plaintiffs may not
        aggregate if they have separate and distinct claims. If there is
        a single indivisible harm, plaintiffs may aggregate, which is
        usually done through supplemental jurisdiction.
      8. In class actions, until
        recently there has been an especially stringent and clear rule:
        every member of the class had to satisfy the jurisdictional
        amount. However, some courts have recently ruled that as long as
        the named class representatives meet the amount, the supplemental
        jurisdiction doctrine applies, so that the unnamed members need
        not meet the jurisdictional amount.

        1. Old Rule on
          Class Action Lawsuits – Note Case:
          Zahn v.
          International Paper Co.

          1. Four owners of VT
            lakefront property brought a diversity action on behalf of
            themselves and 200 other lakefront property owners. Supreme
            Court held that only Ps who individually met $10,000
            jurisdictional amount could be members of the class.
          2. However, Class Action
            Fairness Act allows for aggregation of individual class member
            claims to determine whether the statute’s $5 million amount in
            controversy requirement is met.
      9. Injunctive Relief
        – Note Case:
        McCarty v. Amoco Pipeline Co.
        (Approaches for determining amount in controversy for
        jurisdictional purposes in diversity cases seeking injunctive
        relief):

        1. “Plaintiff viewpoint”
          rule: only the value of the plaintiff may be used to determine
          the jurisdictional amount. Jurisdiction is present if the value
          to the plaintiff exceeds the required amount regardless of the
          value to the defendant.
        2. From the point of view
          of the party seeking to invoke federal jurisdiction, the court
          will look to the plaintiff’s viewpoint in a case brought
          originally in federal court and to the defendant’s viewpoint in
          a case removed to federal court from state court.
        3. “Either viewpoint”
          rule: In determining the matter in controversy, we may look to
          the object sought to be accomplished by the plaintiff’s
          complaint; the test for determining the amount in controversy is
          the pecuniary result to either party which the judgment would
          directly produce.
    4. Note on Judicially
      Created Exceptions to Diversity Jurisdiction

      1. Federal courts will not
        act even though diversity is present in the areas of probate and
        domestic relations. These are areas of the law in which the
        states have an especially strong interest and a well-developed
        competence for dealing with them.

        1. Ankenbrandt v.
          Richards

          1. Domestic-relations
            exception; the Supreme Court found that a domestic relations
            exception does exist as a matter of statutory construction, but
            that it is not mandated by the Constitution. The Court,
            however, limited the exception to cases involving the issuance
            of a divorce, alimony, or child custody decree.
  3. Subject Matter
    Jurisdiction in Federal Courts
    Federal Questions

    1. The Constitution gives
      federal courts the authority to hear federal question cases in 28
      U.S.C. § 1331
      , which states, “The
      district courts shall have original jurisdiction of all civil
      actions arising under the Constitution, laws, or treaties of the
      United States.”
    2. Overbroad
      interpretation of Congress’ power to authorize SM jurisdiction –
      Osborne v. Bank of the United States

      1. Rule: Congress
        has a broad power to confer subject matter jurisdiction over all
        cases that conceivably involve federal questions.
      2. Rationale: The
        bank was started by federal statute. In order for the case to be
        heard in federal court, it must be both authorized by Congress and
        the authorization must be Constitutional. It is authorized
        because it said in the congressional act that chartered the bank
        can sue and be sued in any Circuit Court of the US. Federal law
        is a necessary ingredient for the lawsuit. The act is
        constitutional, as any such lawsuit could conceivably involve a
        question of federal law and thus “arise under” the
        Constitution or laws of the US.
      3. Note Case: Bank
        of the United States v. Planters’ Bank of Georgia

        1. The BoUS had purchased
          notes issued by a state bank, which refused to honor them. The
          BoUS sued and the state bank contested the federal court’s
          jurisdiction. Supreme Court held that the question had been fully
          considered in Osborn and that it was unnecessary to repeat
          the reasoning used in that case.
    3. Plaintiff’s COA
      Must Involve a Federal Question –
      Louisville &
      Nashville R. Co. v. Mottley

      1. Rule: In
        order to obtain federal question jurisdiction, a plaintiff’s
        cause of action must involve a federal question, rather than
        anticipating that a defendant’s defense will raise a federal
        question.
      2. Rationale: The
        plaintiff’s complaint must itself raise the federal questions in
        order to obtain subject matter jurisdiction.
    4. FC Cannot Hear
      Issues Raised by Counterclaim – Note Case:
      Holmes Group,
      Inc. v. Vornado Circulation Systems, Inc.

      1. Court rejected argument
        that Federal Circuit Court, which has exclusive jurisdiction over
        patent claims, could hear an appeal in which the patent issue was
        raised by counterclaim and not on the face of the well-pleaded
        complaint.
    5. Can’t Just
      Anticipate A Federal Defense – Note Case:
      Skelly Oil v.
      Phillips Petroleum Co
      .

      1. Anticipating a
        defense based on federal law would contravene the whole trend of
        jurisdictional legislation by Congress, disregard the effective
        functioning of the federal judicial system and distort the limited
        procedural purposes of the Declaratory Judgment Act, which states
        that even when a defendant uses federal law as his defense in
        seeking declaratory judgment, courts must still look to see if
        action brought by the plaintiff arises under federal law.
    6. No Artful Pleading
      – Note Case:
      Bright v. Bechtel Petroleum, Inc.

      1. When a federal question
        complaint is written to seem like it involves a state law, it may
        still be removed to federal court because it is seen as artful
        pleading.
    7. COA Only Arises
      Under Federal Act If Complaint Has Remedy Expressly Granted by Act

      T.B. Harms Co. v. Eliscu

      1. Rule: A cause
        of action alleging assignments of copyrights does not arise under
        the Copyright Act for purposes of federal question jurisdiction.
      2. Rationale: An
        action “arises under” the Copyright Act, for purposes of
        federal jurisdiction under § 1338, only if the complaint is for a
        remedy expressly granted by the Act, asserts a claim requiring
        construction of the Act, or presents a case where a distinctive
        policy of the Act requires that federal principles control the
        disposition of the claim. The claim can also disclose a need for
        determining the application of the Act or there may be a
        distinctive policy of the Act which requires federal principle
        govern this claim.

        1. TB Harms Test
          (is an appeals court case, so it is not binding everywhere)

          1. When there is a remedy
            expressly granted by that law.
          2. When the case asserts
            a claim that requiring construction of federal law.
          3. Not as sure, but if it
            presents a case where there is some policy of federal law that
            might require the case to be heard in federal court.
    8. Yes, Arises Under
      US Law – Note Case:
      Smith v. Kansas City Title &
      Trust Co.

      1. Example of a claim that,
        although created by state law, “arises under” a law of the US
        by virtue of requiring a determination of the meaning or
        application of such law. The general rule is that where it
        appears from the bill or statement of the plaintiff that the right
        to relief depends upon the construction or application of the
        Constitution or laws of the US, and that such federal claim is not
        merely colorable, and rests upon a reasonable foundation, the
        District Court has jurisdiction.
    9. Not Arising Under
      US Law – Note Case:
      Moore v. Chesapeake & Ohio Ry.
      Co.

      1. (Appears to contradict
        Smith) – A suit that arises from a state law that incorporates a
        federal law is not regarded as a suit arising under federal law.
    10. Not arising under
      – Note Case:
      Shoshone Mining Co. v. Rutter

      1. (Reverse situation
        of Smith) – The claim arose from a federally created cause of
        action that turned on issues of state law and was not considered
        as one which necessarily arises under the Constitution and laws of
        the US.
    11. Patent
      infringement v. breach of contract –
      Luckett v. Delpark,
      Inc.

      1. The patentee apparently
        could have sued for infringement of his patent but chose instead
        to sue for breach of contract. The Supreme Court affirmed the
        District Court’s dismissal because the patentee did not give the
        federal district court jurisdiction of the cause as one arising
        under the patent laws.
    12. Requirements to
      dismiss a Federal Claim – A federal court must dismiss a claim
      arising under federal law for want of subject-matter jurisdiction
      if the claim is “so attenuated and unsubstantial as to be
      absolutely devoid of merit.” It must also dismiss for want of
      jurisdiction if the claim clearly is foreclosed by prior decisions
      of the Supreme Court. The test for dismissal is rigorous and, if
      there is any foundation of plausibility to the claim, federal
      jurisdiction exists.
    13. Requiring The
      Interpretation Of Federal Law Is Not Good Enough To Be Heard In
      Federal Court –
      Merrell Dow Pharmaceuticals Inc. v.
      Thompson

      1. Rule: A
        state-law private action, which alleges a violation of a federal
        statute, “arises under” the laws of the US only if Congress
        intended to provide a federal remedy for the statutory violation.
      2. Rationale (5/4
        Decision)
        : A complaint alleging a violation of a federal
        statute as an element of a state cause of action, when Congress
        has determined that there should be no private, federal cause of
        action for the violation, does not state a claim arising under the
        laws of the US. A case may “arise under” the Constitution or
        laws of the US, for purposes of § 1331, in two ways. First, and
        most commonly, federal law itself creates a cause of action.
        Second, a cause may arise under federal law where the vindication
        of a right under state law necessarily turns on some construction
        of federal law. The mere presence of a federal issue as an
        element of a state tort does not warrant federal jurisdiction.
      3. Dissent: Brennan:
        There may be federal-question jurisdiction, even though both the
        right asserted and the remedy sought by the plaintiff, are
        state-created. The P’s right to relief depended upon a
        construction of the Constitution or the laws of the US. Although
        Congress did not create a federal cause of action or federal
        remedy under the Act, it does not follow that Congress precluded
        federal jurisdiction over state-law claims involving violations of
        the Act. If Congress’s decision not to provide a private
        federal remedy does not pre-empt such a state remedy, then it also
        should not foreclose federal jurisdiction over the state remedy.
        Federal courts are better able to interpret federal laws, and the
        necessity of uniformity of decisions warrants federal
        jurisdiction.

        1. After Merrell:
          The factors used in determining whether there is a federal cause
          of action are:

          1. Whether the statute
            was passed for the benefit of individuals like Plaintiffs;
          2. Whether there was
            a congressional purpose that there be a private cause of action;
          3. Whether the
            federal cause of action would further the purposes of the
            statutory/regulatory scheme; and
          4. Whether the cause
            of action is usually under state law.
    14. If National
      Interest In Providing Federal Forum Is Sufficient, Might Support
      Exercise of Federal Question Jurisdiction – Note Case:
      Grable
      & Sons Metal Products, Inc. v. Darue Engineering &
      Manufacturing

      1. Supreme Court resolved
        the Merrell Dow split and held that the absence of a
        federal cause of action is not inevitably fatal to federal
        jurisdiction.
  4. The Subject Matter
    Jurisdiction of The Federal Courts – Supplemental Claims and Parties

    1. You have to have
      diversity/amount in controversy or a federal question to be heard
      in federal court. However, these can just be ways to get your foot
      in the door. Once that foot is in the door, supplemental claims
      allow the parties to attempt to bring up other claims that
      otherwise wouldn’t have been good enough to get them to federal
      court.
    2. Supplemental
      Jurisdiction Statute
      §
      1367

      1. 1367(a) states except as
        provided in subsections (b) and (c) or as expressly provided
        otherwise by Federal statute, 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 United States Constitution. Such
        supplemental jurisdiction shall include claims that involve the
        joinder or intervention of additional parties.
      2. 1367(b) states in any
        civil action of which the district courts have original
        jurisdiction founded solely on section 1332 of this title, the
        district courts shall not have supplemental jurisdiction under
        subsection (a) over claims by plaintiffs against persons made
        parties under Rule 14, 19, 20, or 24 of the Federal Rules of Civil
        Procedure, or over claims by persons proposed to be joined as
        plaintiffs under Rule 19 of such rules, or seeking to intervene as
        plaintiffs under Rule 24 of such rules, when exercising
        supplemental jurisdiction over such claims would be inconsistent
        with the jurisdictional requirements of section 1332.
      3. 1367(c) states 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,
        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.
      4. 1367 (b) “over
        claims by plaintiff against persons made parties by the following
        rules (we’ll learn later)” in confliction with the diversity
        statute (1332) – so if P sues D and D brings in another D from the
        same state as P, then it would still have diversity because of
        1367(b). However, D2 would only have to pay D1 because there is no
        claim from P.
    3. Under the doctrine of
      supplemental jurisdiction, new parties and new claims may not have
      to independently satisfy subject-matter jurisdiction – they can
      in effect be “tacked on” to the “core” controversy.
      Replaces two older judge made doctrines, pendant and ancillary
      jurisdiction.

      1. Pendent Jurisdiction has
        been used when the plaintiff, in her complaint, appends a claim
        possessing such a basis.
      2. Ancillary
        Jurisdiction has been used when either a plaintiff or a defendant
        injects a claim lacking an independent basis for jurisdiction by
        way of a counterclaim, cross-claim, or third party complaint.
    4. Yes – If State
      and Federal Claim From Common Nucleus of Facts –
      United
      Mine Workers of America v. Gibbs

      1. Rule: Under the
        doctrine of pendent jurisdiction, if the federal claim and the
        state claim arise from the same “case or controversy,”
        the federal court can exercise jurisdiction over the state claim
        as well. If the federal and state claims arise from a “common
        nucleus of operative fact,” then they comprise the same case
        or controversy. The court should not exercise jurisdiction if
        there would be high risk of jury confusion, the federal claims are
        dismissed, or it would otherwise preserve judicial expenses.
      2. Rationale:
        Pendent jurisdiction exists whenever the state and federal claims
        are so closely related as to comprise one constitutional case. It
        is a doctrine of discretion, based on considerations of judicial
        economy, convenience, and fairness to litigants. A federal court
        should not exercise pendent jurisdiction if the state issues
        predominate. It is unwarranted if there is a substantial
        likelihood of a jury confusing the legal theories of the federal
        and state claims. Dismissal of the pendent state law claims would
        be warranted only if the federal claims were dismissed before
        trial.
      3. Three Factors Must be
        Considered:

        1. Judicial economy
        2. Convenience
        3. Fairness to the
          litigants.
      4. The exercise of
        pendent jurisdiction must be judged by whether it furthers some
        federal policy. Pendent jurisdiction serves two purposes: 1) it
        ensures that litigants will not be dissuaded from maintaining
        their federal rights in a federal court solely because they can
        dispose of all claims by one litigation in the state but not the
        federal form and 2) assuming that the litigants are in a federal
        forum, pendent jurisdiction serves the interest of avoiding
        piecemeal litigation, thus promoting judicial economy and greater
        expedition for litigants.
    5. Pendant Party
      Jurisdiction is Sometimes OK –
      Aldinger v. Howard

      1. Rule: A
        federal court may grant pendent party jurisdiction to a state
        claim against a defendant which is derived from a common nucleus
        of operative fact with a federal claim against a separate
        defendant, if the statutory grant of subject-matter jurisdiction
        did not expressly or impliedly negate such joinder or if judicial
        efficiency warrants such joinder.
      2. Rationale: The
        Supreme Court refused to apply pendent jurisdiction to an
        additional party with respect to whom no independent basis of
        federal jurisdiction existed. Gibbs was distinguished on two
        grounds: 1) The addition of a completely new party would run
        counter to the well-established principle that federal courts, as
        opposed to state trial courts of general jurisdiction, are courts
        of limited jurisdiction marked out by Congress and 2) by virtue of
        the statutory grant of subject-matter jurisdiction, Congress has
        addressed itself to the party as to whom jurisdiction pendent to
        the principal claim is sought.
    6. Diversity – When
      A Pendant Party Destroys Complete Diversity Then No Federal
      Jurisdiction-
      Owen Equipment & Erection Co. v. Kroger

      1. Rule: A federal
        court does not retain jurisdiction over an action, based on
        diversity of citizenship, when the plaintiff adds a pendent party
        defendant who destroys complete diversity.
      2. Rationale: Beyond
        the constitutional minimum, there must be an examination of the
        posture in which the nonfederal claim is asserted and of the
        specific statute that confers jurisdiction over the federal claim,
        in order to determine whether “Congress in the statutes
        conferring jurisdiction has not expressly or by implication
        negated” the exercise of jurisdiction over the particular
        nonfederal claim. § 1332(a)(1) requires complete diversity of
        citizenship and diversity jurisdiction is not to be available when
        any plaintiff is a citizen of the same State as any defendant.
        Complete diversity was destroyed; the statutory requirement of
        complete diversity cannot be defeated by the simply expedient of
        suing only those defendants who were of diverse citizenship and
        waiting for them to implead nondiverse defendants.
    7. Congress Must
      Specifically Authorize Pendant Party Jurisdiction –
      Finley
      v. United States

      1. Rule: In
        order to obtain pendent party jurisdiction, the statute conferring
        federal jurisdiction must expressly authorize pendent party
        jurisdiction.
      2. Reasoning: Two
        things are necessary to create jurisdiction, whether original or
        appellate – The Constitution must have given to the court the
        capacity to take it, and an act of Congress must have supplied it.
        This case was distinguished from Gibbs in that it brings into
        question pendent party jurisdiction or jurisdiction over parties
        not named in any claim that is independently cognizable by the
        federal court. With respect to the addition of parties, as
        opposed to the addition of only claims, the court will not assume
        that the full constitutional power has been congressionally
        authorized, and will not read jurisdictional statutes broadly.
    8. Finley prompts
      Congress to pass
      § 1367
      because the court held in Aldinger that before a federal
      court may exercise pendent party jurisdiction it must satisfy
      itself that Congress has not “expressly or by implication
      negated its existence” and then instructed that “a grant
      of jurisdiction over claims involving particular parties does not
      itself confer jurisdiction over additional claims by or against
      different parties.”

      1. Supplemental Claims
        and Parties are OK
        §1367 (a) Except for the exceptions – 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 US
        Constitution. Such supplemental jurisdiction shall include claims
        that involve the joinder or intervention of additional parties.

        1. This includes
          additional claims asserted by plaintiff as well as cross-claims
          and counter claims.
      2. Limits on
        Supplemental Jurisdiction
        – § 1367(b) – A federal court
        does not retain jurisdiction over an action, based on diversity of
        citizenship, when the plaintiff adds a pendent party defendant who
        destroys complete diversity- fully implements the Kroger
        rationale by prohibiting the district courts, in actions founded
        solely on the diversity statute, from exercising supplemental
        jurisdiction over claims by plaintiffs against persons made
        parties through any of several of the joinder devices of the
        Federal Rules when doing so would be inconsistent with the
        jurisdictional requirements of section 1332. It also prohibits
        the exercise of supplemental jurisdiction in connection with the
        joinder or intervention of persons as plaintiffs when it would be
        inconsistent with section 1332
      3. Courts Discretion
        – § 1367(c): provides federal courts with discretion in some
        circumstances to decline to exercise supplemental jurisdiction.
        It codifies those factors that the Supreme Court in Gibbs
        recognized as providing a sound basis for a lower court’s
        discretionary decision to decline supplemental jurisdiction. It
        also accommodates exceptional circumstances, not defined, in which
        grounds for dismissal of the supplemental claim may be compelling.
        In each of these circumstances, the district court in exercising
        its discretion must undertake a case-specific analysis.

        1. The claim raises a
          novel or complex issue of state law.
        2. The state claim
          substantially predominates over the claim or claims over which
          the court has original jurisdiction.
        3. The district court has
          dismissed all claims over which is had original jurisdiction.
        4. In exceptional
          circumstances, there are other compelling reasons for declining
          jurisdiction.
      4. § 1367(d):
        providing a period of tolling of statutes of limitations for any
        supplemental claim that is dismissed and for any other claims
        voluntarily dismissed at the same time or thereafter.
      5. P Couldn’t Implead
        A Non-Diverse Party In Defense Against A Counterclaim – Note
        Case:
        Guaranteed Systems, Inc. v. American National Can
        Co.

        1. The defendant,
          after removing the action on the ground of diversity, asserted a
          counterclaim against the plaintiff. The plaintiff’s motion to
          implead a non-diverse third-party in defense against the
          counterclaim was denied by the court.
        2. Critic of § 1367(b)
          states that the section states: 1) if a claim is asserted against
          diversity plaintiff, she cannot implead a nondiverse third-party
          defendant who may owe her indemnity or contribution; 2) if a
          claim is asserted against diversity plaintiff, she cannot assert
          a cross-claim against a nondiverse co-plaintiff; 3) a nondiverse
          third-party defendant may assert a claim against the diversity
          plaintiff, but the diversity plaintiff cannot assert a compulsory
          counterclaim in response; 4) diversity plaintiff cannot assert a
          claim against a nondiverse intervenor or necessary party, even
          though their claims against her will invoke supplemental
          jurisdiction.
      6. Court Can
        Exercise Supplemental Jurisdiction Over Joined Plaintiff Not
        Meeting Amount In Controversy Requirement – Note Case:
        Exxon
        Mobil Corp. v. Allapattah Services, Inc.

        1. In 5/4 decision,
          Supreme Court held that a federal court in a diversity action may
          exercise supplemental jurisdiction over additional plaintiffs
          whose claims do not satisfy the minimum amount-in-controversy
          requirement, provided the claims are part of the same case or
          controversy as the claims of plaintiffs who do allege a
          sufficient amount in controversy.
      7. When Federal
        Basis For Action Disappears, Court May Decide Whether to Assert
        Jurisdiction Over Remaining Claims – Note Case:
        Shanaghan
        v. Cahill

        1. The Fourth Circuit
          ruled that, when the federal basis for an action disappears, a
          district court is free to decide whether to assert jurisdiction
          over the remaining claims, in accordance with section 1367.
      8. Executive
        Software North America, Inc. v. US District Court For the Central
        District of California

        1. Rule: In order
          for a court to decline to exercise jurisdiction over supplemental
          state law claims pursuant to 28 U.S.C. § 1367, the district
          court must find that one of the circumstances under 28 U.S.C. §
          1367(c) exist and articulate the circumstances in the order
          declining jurisdiction.
        2. Rationale: This
          case illustrates that if a District Court declines to exercise
          supplemental jurisdiction over state law claims that arise from
          the common nucleus of operative fact of the federal law claims,
          there must be articulated reasons that are mentioned in the
          statute in order to remand to state court. In enacting 28 U.S.C.
          § 1367(c), Congress has delineated specific circumstances in
          which a federal court can decline to exercise jurisdiction over
          state law claims. Under Section (c)(1)-(3), the District Court
          can use these exceptions so long as it agrees with the policies
          of “economy, convenience, fairness and comity.” Under
          Section (c)(4), the District Court must use these exceptions only
          in exceptional circumstances and must articulate what the
          compelling reasons for declining jurisdiction are.
  5. Removal
    1. Basic Rules of §1441.
      1. D can remove to federal
        court if it’s a federal question claim.
      2. D can remove to federal
        court on diversity if he’s sued in another state.
      3. D can remove separate
        and independent claims that joined w/ unremovable claims in one
        group.
      4. P can never remove
        (should’ve filed it in federal court if that is where P wanted
        lawsuit heard)
      5. Same rules of Federal
        Question, Diversity, and Amount in Controversy apply.
      6. Section 1446(b)
        requires the notice of removal to be filed by the defendant within
        30 days of receipt of the initial pleading or service of summons.
        The Supreme Court ruled that only formal service of process
        initiates the removal period.
      7. A plaintiff may
        choose to avoid federal jurisdiction by pleading only state law
        claims or joining parties who will destroy diversity jurisdiction.
        There are three exceptions:

        1. A plaintiff may not
          defeat diversity jurisdiction by fraudulently joining a defendant
          against whom the plaintiff has no cause of action.
        2. The plaintiff may not
          disguise federal causes of action that would make the case
          removable (artful pleading).
        3. A version of artful
          pleading mandates that certain causes of action are so
          exclusively federal in character that even if the plaintiff does
          not plead them, they will completely preempt any state cause of
          action and make any cause of action the plaintiff attempts to
          plead federal, and, therefore, removable.
      8. § 1445 –
        Non-removable claims

        1. Plaintiff cannot remove
        2. Railroad
        3. A carrier unless over
          $10k
        4. State worker’s
          compensation claim
        5. Federal Violence
          Against Women Act
      9. § 1446 – Time
        Line for Removal

        1. When a claim is filed,
          anytime after that it becomes removable within thirty days

          1. If it is a diversity
            claim and a party drops out or settles, if it has been over a
            year, the case cannot be removed. If it is within one year, the
            case can be removed within 30 days.
      10. Remand – a judge’s
        decision to remand a case back to state court is not appealable.
      11. Date of removal
        filing is when the case is analyzed.
      12. A case can be
        amended to include Federal Jurisdiction, but not amended by the P
        to defeat it.

        1. Exception –
          Diversity cases present an exception to the rule that
          removability is determined as of the time when the notice of
          removal is filed. It must exist at the time of filing and at
          notice of removal.
    2. P Can’t Remove
      to State Court if D brings up Federal Counterclaim –
      Shamrock
      Oil & Gas Corp. v. Sheets

      1. Rule: A plaintiff
        may not remove a state-court action to the federal courts, even if
        a defendant brings a counterclaim that satisfies the requirements
        for federal jurisdiction.
      2. Rationale: The
        court mentions that while the act of 1875 allowed for a suit to be
        removed by either party, the act of 1887 changed the wording to
        include only “defendants”.
    3. Third Party D May
      Not Remove to Federal Court Note Case:
      First National
      Bank of Pulaski v. Curry

      1. Court held that third
        party defendants may not remove an action to federal court. They
        explained that although Shamrock Oil was not dispositive of the
        precise issue before them, it dictated that the phrase “the
        defendant or the defendants” as used in 1441(a) be interpreted
        narrowly, to refer to defendants in the traditional sense of
        parties against whom the plaintiff asserts claims.
    4. If a case is removed
      erroneously, a federal court must remand it to state court. See
      Section 1447(c). Section 1447(d) states that a remand order is not
      reviewable, except in civil rights cases pursuant to Section 1447.
    5. Under
      1441(c), whenever a separate and
      independent claim or cause of action within the jurisdiction
      conferred by section 1331
      is joined with one or more otherwise non-removable claims or causes
      of action, the entire case may be removed and the district court
      may determine all issues therein, or, in its discretion, may remand
      all matters in which State law predominates.

      1. Separate and
        Independent Claims must be TRULY Separate –
        American
        Fire & Cas. Co. v. Finn

        1. Rule: A
          claim may not be removed pursuant to § 1441(c) unless the claim
          is separate and independent from one or more otherwise
          non-removable claims.
        2. Rationale: The
          Finn Court concluded that “where there is a single wrong to
          plaintiffs, for which relief is sought, arising from an
          interlocked series of transactions, there is no separate and
          independent claim or cause of action under § 1441(c).”
      2. A District
        Court’s Discretion To Remand Under § 1441(C) Can Pertain Only
        To Those State Law Claims That The District Court Could Decline To
        Hear Under § 1367. –
        Borough of West Mifflin v.
        Lancaster

        1. Rule:
          Remand of a case is governed exclusively by statute. Under §
          1441(c), “Whenever a separate and independent claim or cause
          of action within the jurisdiction of [Section] 1331 of this title
          is joined with one or more otherwise non-removable claims or
          causes of action, the entire case may be removed and the district
          court may determine all issues therein, or, in its discretion,
          may remand all matters in which State law predominates.”
        2. Rationale:
          Under § 1367(c), a district court has discretion to decline to
          hear certain state law claims it would have supplemental
          jurisdiction to entertain. However, nothing in this
          section permits the district court to decline to
          hear claims it has original jurisdiction over, i.e. the
          federal civil rights claim. Therefore, remand of the entire case
          is inappropriate even if the state law claims were properly
          remanded. The state law claims were not even properly remanded to
          the state court. Section 1367(c) permits remand at the discretion
          of the district court. The key language for purposes of the
          present case is that the federal claim must be “separate and
          independent” from the state law claims. In other words, the
          entire case is not removable if the federal claim and the state
          claims arise out of the same transaction or series of events.
          Here, the federal civil rights claim does arise out of the same
          series of events as the state law claims, namely, the plaintiffs
          being accosted and arrested. Therefore, removal under § 1441(c)
          was appropriate and remand of the case to state court is clearly
          forbidden.
  6. Challenging the
    Subject-Matter Jurisdiction of the Court

    1. Four ways to attack
      subject-matter jurisdiction:

      1. 12(b)(1) Motion made
        over lack of jurisdiction (must be made 20 days after service)
      2. 12(h)(3) If either
        party suggests lack of subject matter jurisdiction, court shall
        dismiss action.
      3. 60(b)(4) Even after
        judgment is final, can move to vacate that judgment because the
        court lacks subject-matter jurisdiction.
      4. Can argue on appeal.
    2. Direct Attack on a
      Court’s Lack of Subject-Matter Jurisdiction

      1. Federal Rules of Civil
        Procedure 8(a)(1), 12(b)(1), and (h)(3), 60(b)(4), and Official
        Form 2, and § 1653
      2. In the federal courts a
        lack of subject-matter jurisdiction may be asserted at any time by
        any interested party, either in the answer, or in the form of a
        suggestion to the court prior to final judgment or on appeal.
        Parties may not create the jurisdiction of a federal court by
        agreement or by consent.
      3. No Need to Decide PJ
        before SJ – Note Case:
        Ruhrgas Ag v. Marathon Oil Co.

        1. The Supreme Court
          held that since both subject matter and personal jurisdiction are
          required by the Constitution and affect a federal court’s power
          to adjudicate a case, there is no reason to require a district
          court to decide one before the other.
      4. Situation in
        Which Defects in Subject Matter Jurisdiction Should Be Immune From
        Direct Attack – Note Case:
        Di Frischia v. New York
        Central R. Co.

        1. D initially objected to
          jurisdiction, asserting lack of diversity, but then withdrew the
          objection. After the statute of limitations ran out, D then
          reasserted objection. District court dismissed action, but Third
          Circuit reversed, refusing to permit D to play “fast and loose
          with judicial machinery and deceive the courts.”

          1. This case has been
            criticized and distinguished as limited to its facts.
      5. Have to Follow
        Restraining Orders – Even W/O SMJ – Note Case:
        United
        States v. United Mine Workers

        1. Obedience to a
          temporary restraining order is required, even though the issuing
          court may lack subject-matter jurisdiction or otherwise may have
          based its decision on an incorrect view of the law, unless there
          is no opportunity for effective appellate review of the decree.
      6. The Federal Court
        May Impose Sanctions Upon A Plaintiff Pursuant To Federal Rule 11
        Even If It Lacks Subject-Matter Jurisdiction –
        Willy v.
        Coastal Corp.

        1. P brought a
          wrongful discharge action against employer, who removed to
          federal court. Court dismissed claim and imposed sanctions on P
          pursuant to Rule 11. P appealed, but Supreme Court upheld ability
          of District Court to impose sanctions because such an order
          implicates no constitutional concern and does not raise the issue
          of a district court adjudicating the merits of a case over which
          it lacks jurisdiction.
    3. Collateral Attack
      on a Judgment for Lack of Subject-Matter Jurisdiction

      1. Collateral attacks
        are not usually permissible against federal courts.
        Can only
        do so if subject-matter jurisdiction was obviously lacking,
        allowing the judgment to stand would substantially infringe on the
        authority of another court, or a court lacking the capability to
        make an informed determination rendered the judgment.

        1. A judgment rendered
          by a court that lacked jurisdiction over the subject matter is
          void and a nullity. A collateral attack is not always an
          available technique for challenging a judgment on the ground that
          the rendering court lacked subject-matter jurisdiction.
      2. The Restatement
        (Second) Judgments takes the approach that the judgment in a
        contested action, whether or not the question of subject-matter
        jurisdiction actually was litigated, is beyond collateral attack
        unless there are no justifiable interests of reliance that must be
        protected, and:

        1. The subject matter of
          the action was so plainly beyond the court’s jurisdiction that
          its entertaining the action was a manifest abuse of authority; or
        2. Allowing the judgment
          to stand would substantially infringe the authority of another
          tribunal or agency of government; or
        3. A court lacking
          capability to make an adequately informed determination of a
          question concerning its own jurisdiction rendered the judgment
          and as a matter of procedural fairness the party seeking to avoid
          the judgment should have opportunity belatedly to attack the
          court’s subject-matter jurisdiction.
      3. Supreme Court
        Refuses to Allow Collateral Act –
        Chicot County Drainage
        Dist. v. Baxter State Bank

        1. Parties who had notice
          chose not to appear in the original action then attempted to
          attack collaterally a judgment rendered by a district court. The
          Supreme Court refused to allow the attack saying, “if the
          general principles governing the defense of res judicata are
          applicable, [respondents] having the opportunity to raise the
          question of invalidity, were not the less bound by the decree
          because they failed to raise it.”
      4. Supreme Court
        Allowed Collateral Attack –
        Kalb v. Feuerstein

        1. The Supreme Court
          stated that while it is generally true that a judgment by a court
          of competent jurisdiction bears a presumption of regularity and
          is not subject to collateral attack, Congress may create an
          exception to that principle and render judicial acts taken with
          respect to the person or property of a debtor whom the bankruptcy
          law protect nullities and vulnerable collaterally.
      5. Collateral Attack
        Not Allowed When Questions Have Been Fairly Decided in Original
        Court –
        Durfee v. Duke

        1. A Missouri federal
          District Court allowed collateral attack on a Nebraska judgment
          quieting title to a tract of bottom land n the Missouri River, on
          the ground that considerations of territorial sovereignty
          outweighed policies of res judicata. The Supreme Court reversed
          on the grounds that a judgment is entitled to full faith and
          credit when the second court’s inquiry discloses that those
          questions have been fully and fairly litigated and finally
          decided in the court that rendered the original judgment.
      6. Recent Example of
        Supreme Court’s Attitude Toward Collateral Attack –
        United
        States Catholic Conference v. Abortion Rights Mobilization, Inc.

        1. D sued to revoke the
          tax-exempt status of the Roman Catholic Church because of the
          church’s intervention in favor of political candidates who
          supported the church’s position on abortion. ARM served P with
          a subpoena seeking evidence to support its claims. P refused to
          comply with subpoena and was held in civil contempt with a fine
          of $50,000 per day for further noncompliance. The Supreme Court
          held that a nonparty witness, the Conference, could challenge the
          court’s lack of subject matter jurisdiction in defense of a
          civil contempt citation.
Venue,
Transfer, and Forum non Conveniens

  1. Venue
    1. General Principles
      1. Venue means the place of
        the trial in an action within a state.
      2. Venue has two parts:
        1. Mandatory
          You cannot file a lawsuit in a place where venue is not proper
          (1406(a))
        2. Discretionary
          Sometimes even if the lawsuit is filed in the proper venue, it
          will end up being heard somewhere else (1404(a))
      3. A comparative study
        of contemporary venue provisions reveals some thirteen different
        fact situations upon which venue statutes are predicated.

        1. Where the subject of
          action or part thereof is situated.
        2. Where the cause of
          action, or part thereof, arose or accrued.
        3. Where some fact is
          present or happened.
        4. Where D resides.
        5. Where D is doing
          business.
        6. Where D has an office
          or place of business, or an agent, or representative, or when an
          agent or officer resides.
        7. Where P resides.
        8. Where P is doing
          business.
        9. Where D may be found.
        10. Where D may be summoned
          or served.
        11. In the county
          designated in P’s complaint.
        12. In any county.
        13. Where the seat of
          government is located.
      4. Note Case:
        Burlington Northern R.R. Co. v. Ford

        1. D raised a challenge to
          Montana’s venue rules on the ground that they violated the
          Equal Protection Clause of the 14th Amendment. The Supreme Court
          upheld the constitutionality of the state’s venue rules because
          the forum preferable to one party may be undesirable to another
          and the adjustment of such warring interests is a valid state
          concern. In striking the balance between them, a State may have a
          number of choices, any of which would survive scrutiny, each of
          them passable under the standard tolerating some play in the
          joins of governmental machinery.
    2. Local and
      Transitory Actions

      1. The distinction
        between local and transitory actions:

        1. Local actions are
          cases involving a piece of local, real, non-movable property.
        2. Transitory actions are
          cases that happen to anything movable and can arise anywhere.
      2. Modern Trend in
        Local and Transitory Actions –
        Reasor-Hill Corp. v.
        Harrison

        1. Rule: A lawsuit
          is maintainable for injury to real property located outside the
          forum state as long as the forum state has personal jurisdiction
          over the defendant.
        2. Rationale: Although
          traditionally cases involving real property were considered local
          actions and could only be brought where the property was located,
          this case articulates the modern trend. Policies supporting the
          traditional rule are expressed in the dissenting opinion.
        3. Dissent: Justice
          McFadden: It is not simple to decide questions of title from
          other states. In addition, each state is its own sovereign and
          there are certain issues that certain states must decide.
          Finally, providing a haven for delinquent citizens is an issue
          for the legislature, not the courts.

          1. Livingstone v.
            Jefferson
            is the leading case in the US. That suit was
            part of the famous litigation between Edward Livingstone and
            Thomas Jefferson. The case was heard by Marshall as circuit
            justice and Tyler as district judge. Both agreed that the suit,
            which was for a wrongful entry upon land in LA, could not be
            maintained in VA. American courts rely almost uniformly upon
            this case for the following three reasons:

            1. First, the ground
              most frequently relied upon is that the courts are not in a
              position to pass upon the title to land outside the
              jurisdiction.
            2. Second, it has been
              argued that since the tort must take place where the land is
              situated, P should pursue his remedy before D leaves the
              jurisdiction.
            3. Third, there is an
              understandable reluctance to subject one’s own citizens to
              suit by aliens, especially if the other jurisdiction would
              provide no redress if the situation were reversed.
    3. Venue in the
      Federal Courts

      1. 28 U.S.C. §1391 –
        The General Federal Venue Statute

        1. Diversity action
          must be brought only in

          1. A judicial
            district where any D resides, and if there is more than one D,
            if all D’s from 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 the property
            that is the subject of the action is situated
          3. Escape Hatch: A
            judicial district in which any defendant is subject to personal
            jurisdiction at the time the action was commenced, if there is
            no district in which the action may otherwise be brought.
        2. Not solely on
          Diversity – may be brought in

          1. A judicial district
            where any defendant resides, if all D’s reside in the same
            state
          2. A judicial district in
            which a substantial part of the events or omission giving rise
            to the claim occurred, or where the property is situated
          3. Escape hatch: A
            judicial district in which any D may be found, if there is no
            district in which the action may otherwise be brought.
        3. Corporations –
          are deemed to reside in any judicial district in which it is
          subject to personal jurisdiction. In a state w/ more than one
          district in which a D that is a corporation is subject to
          personal jurisdiction at the time an action is commenced if it
          had PJ in that district as if it were a state. If no venue
          qualifies, then the venue that it has the MOST contacts with.
      2. Three methods of
        determining venue
        – §1391 gives three basic methods for
        determining whether there is venue in a particular district

        1. If any D resides in
          that district, and all the D’s reside in the state containing
          that district (good for Diversity and Federal Question cases)
        2. If a substantial part
          of the property that is the subject is situated in the district
          (applicable to both Diversity and Federal Question cases).
        3. If all D’s are in
          some sense reachable in the district and there is no district in
          which the action may otherwise be brought.
      3. Debtors – Bates
        v. C & S Adjusters, Inc.

        1. Rule: Venue is
          proper in the district in which a debtor resides and to which a
          collection notice was forwarded.
        2. Rationale: §
          1391 allows an action to be brought in “a judicial district in
          which a substantial part of the events or omissions giving rise
          to the claim occurred.” Receipt of a collection notice is a
          “substantial part of events giving rise to a claim” and the
          place where that notice was received constitutes proper venue.
          The events giving rise to the claim do not necessarily have to be
          intentional.
      4. “Where the claim
        for relief arose” = Bates provided for venue in “a
        judicial district in which a substantial part of the events or
        omissions giving rise to the claim occurred, or a substantial part
        of the property that is the subject matter of the action is
        situated.”
      5. Unincorporated
        Associations – Note Case:
        Denver & R.G.W.R. Co. v.
        Brotherhood of Railroad Trainmen

        1. Suit against
          multi-state, unincorporated associations is permitted wherever it
          is “doing business,” otherwise 1391(b) would seem to require
          holding the association not suable at all or holding that the
          association resides in any State in which any of its members
          reside, which might present problems of inconvenience to
          litigants and witnesses in conflict with the purpose of venue.
  2. Transfer of Venue
    in Federal Courts

    1. If P filed suit in
      improper venue
      :

      1. In answer, D says that
        there is no venue and files for summary judgment.
      2. Faster and more usual
        method
        : file 12(b)(3) motion asking that the lawsuit be
        dismissed without prejudice so that it can be re-filed in a proper
        venue.
      3. § 1406(a):
        Mandatory transfer requirement.

        1. Instead of
          dismissing the lawsuit, asking court to transfer lawsuit to
          proper venue, but this is discretionary on the court.
        2. This can be done if the
          statute of limitations expires while suit is in the improper
          venue. If the suit is transferred, rather than dismissed, it is
          considered filed before the expiration of the statute of
          limitations and the case can be heard in the new venue.
      4. § 1404(a):
        Discretionary transfer requirement

        1. Not saying that P filed
          in improper venue but that there is a better place to hear the
          suit
        2. It would be more
          convenient to witnesses or parties to have the case transferred.
          This is a very high burden to meet. Only if the convenience
          factors are overwhelming can the case be transferred.
        3. Must prove: 1) P’s
          choice of forum should not be respected because there is a more
          convenient venue and 2) (in both transfer statutes – § 1406 and
          1404(a)) the transferee court could have heard the lawsuit to
          begin with.
      5. Hypo: If there is a
        lawsuit in VA, VA gets to decide what law applies. By contrast if
        lawsuit was heard in CA, CA law applies. If case is transferred
        from VA to CA under 1404(a), then VA law is still applied. The
        transfer is meant to be more convenient for witnesses, etc., but
        not necessarily to afford a change of law. If case was transferred
        under 1406 motion, then CA law would be applied because the venue
        was improper.

        1. Sometimes lawsuits are
          filed in one state to grab the law of that state and then
          transferred under 1404(a) motion with the law following.
      6. In federal question
        cases, the law does not transfer across districts, so a federal
        question case filed in CA and transferred to VA transfers from 9th
        circuit to 4th circuit. Supreme Court does not want VA to pretend
        its in 9th circuit. Federal law, unlike state law, is supposed to
        be uniform. Sometimes laws will change because they have been
        transferred across circuits and that sometimes will result in
        injustice, but Supreme Court is willing to suck that up and allow
        cases to be transferred.
      7. Transfers must be to
        a Ct. that the P could have initially filed in –
        Hoffman
        v. Blaski

        1. Rule: A federal
          court in which suit was properly commenced was not entitled under
          §1404(a) to transfer a case to a district in which the plaintiff
          could not have properly commenced suit.
        2. Rationale: To
          allow the defendant that kind of power would grossly discriminate
          against plaintiffs. By promising not to object to the transferee
          venue, defendants would be able to transfer into any district
          convenient to them. Plaintiffs, on the other hand, would still
          be statutorily limited in their choices of venue and could not
          freely motion to transfer because the defendant would still
          retain the right to object to improper venue.
        3. Hoffman has been
          criticized and courts don’t want to extend it unnecessarily.
      8. In Diversity
        Cases, The Law Applicable In The Transferor Forum Follows The
        Transfer – Note Case:
        Van Dusen v. Barrack

        1. The Supreme Court
          held that, in diversity cases, the law applicable in the
          transferor forum follows the transfer.
      9. Transferee forum
        must apply transferor forum law – Note Case:
        Ferens v.
        John Deere Co.

        1. The Supreme Court
          held that, in a diversity suit, the transferee forum is
          required to apply the law of the transferor court, regardless
          of who initiates the transfer
          .
      10. §1406(a)
        permits the district court to dismiss “or if it be in the
        interest of justice” to transfer a case to any district in which
        it could have been brought when it was brought initially in a
        court in which venue was improper. The law of the transferor
        court cannot govern in the transferee court – cannot benefit
        from filing in improper venue in diversity cases where state law
        governs the issue. The exception is federal question cases. If
        it’s federal law, it should be the same law across the US.
        Federal law, however, is not the same everywhere. So, the law may
        not be the same in the transferee court in federal question cases.

        1. This provision should
          be distinguished from §1404(a), which presupposes that venue in
          the district of commencement is proper.
      11. The Federal Court
        Can Transfer Venue Even If It Lacks Personal Jurisdiction Over The
        Defendants – Note Case:
        Goldlawr Inc. v. Heiman

        1. The Supreme Court
          held that Section 1406 authorizes a transfer even if the
          transferor court lacks personal jurisdiction. The court said the
          filing itself shows the proper diligence on the part of the P
          that such statutes were intended to insure. If by reason of
          uncertainties of proper venue a mistake is made, Congress, by the
          enactment of 1406(a), recognized that “the interest of justice”
          may require that the complaint not be dismissed but rather that
          it be transferred in order that P not be penalized.
      12. §1407:
        provides for the temporary transfer to one district of related
        complex cases such as multidistrict antitrust actions. Transfer
        is appropriate when the cases involve common questions of fact and
        law and when it would be for the convenience of the parties and
        witnesses and in the interests of justice. This provision
        frequently has been used to take advantage of coordinated pretrial
        discovery. The statute authorizes consolidation of cases for
        pretrial purposes only.
      13. Note Case: Lexecon,
        Inc. v. Milberg Weiss Bershad Hynes & Lerach

        1. The Supreme Court
          held that the language of §1407 requires the panel on
          multidistrict litigation to remand cases consolidated under §1407
          to their original courts for trial. Prior to this ruling, it was
          common practice for transferee courts to transfer cases to
          themselves for trial under 1404(a).
      14. Patents and
        copyrights, 28 U.S.C. § 1400
        1. Civil actions,
          suits, or proceedings arising under any Act of Congress relating
          to copyrights or exclusive rights in mask works or designs may be
          instituted in the district in which the defendant or his agent
          resides or may be found.
        2. Any civil action
          for patent infringement may be brought in the judicial district
          where the defendant resides, or where the defendant has committed
          acts of infringement and has a regular and established place of
          business.
  1. Forum non
    Conveniens

    1. A court having
      jurisdiction over a particular case may use is discretion to
      decline that jurisdiction, if the court concludes that the action
      could be more appropriately tried in some other jurisdiction.
      Defendants usually raise, but a court can dismiss on FnC grounds
      itself.
    2. The
      test for FnC –
      Gulf
      Oil Corp. v. Gilbert

A court may resist
imposition upon its jurisdiction even when the letter of a general
venue statute authorizes jurisdiction. Courts should consider:
      1. The private interest
        of the litigants

        1. Ease of access to proof
          – where is the evidence? What is the cost of witnesses to
          court? Is view of premises necessary?
        2. Enforceability of the
          judgment?
        3. Burden on the D?
        4. Residual factor –
          anything else you can think of that affects the individual
          litigants themselves?
        5. Is the alternative
          forum (a foreign country) so bad that it wouldn’t provide a
          remedy or if the court thought the remedy is monstrously lame
          either procedurally or substantively?
      2. Factors of public
        interest.

        1. Are courts congested,
          juries without connection to litigants, want to make sure that
          each jury has some interest, the localized interest in having
          localized controversy decided at home, application of foreign
          law?
If it’s a US P,
the factors must be overwhelming. When it’s a foreign P, need
only be slightly in favor of foreign tribunal. Don’t want
foreigners coming to US courts. The real parties in interest are
foreigners. The overlying test depends on citizenship.
    1. Unfavorable
      Change in Law is Insufficient –
      Piper
      Aircraft Co. v. Reyno

      1. Rule:
        The
        doctrine of forum non conveniens allows a court to dismiss a case
        that was brought in the wrong forum. When all or most of the
        significant events, witnesses and evidence are centered in one
        location, then a court must dismiss a case brought in another
        location under the doctrine of forum non conveniens unless the
        alternate forum provides the plaintiff with absolutely no remedy.
        Whether the law of the forum chosen by the plaintiff is more
        favorable to the plaintiff should not be given weight.
      2. Rationale:
        Plaintiff
        doesn’t want case to go to Scotland because they do not have
        strict liability laws, only negligence. Supreme Court doesn’t care
        about this argument in applying Gulf
        Oil

        test because it would require courts to compare laws of various
        forums and this is what forum non conveniens dismissals are meant
        to avoid. They also say that they do not mean it will never be a
        relevant consideration where the law of the alternative forum is
        inadequate or unsatisfactory, i.e. Scottish law said courts were
        not empowered to hear airplane crash cases, even when they
        occurred in Scotland or Scotland resolves cases by having a
        dance-off. It has to be barbaric or outlandish. Choosing a
        particular forum because the law is more favorable to the
        plaintiff cannot be given any substantial weight under a forum non
        conveniens analysis. Although the general rule is that a court
        should not dismiss a case on grounds of forum non conveniens
        unless there is an alternate forum in which the plaintiff can
        pursue a remedy, this rule only requires that the plaintiff be
        able to file a proper lawsuit in that alternate forum.
    2. There
      Must Exist Another More Convenient Forum Where P Can Obtain Relief
      – Note Case:
      Islamic
      Republic of Iran v. Pahlavi

      1. Lawsuit filed
        against Shah of Iran to recover $35 billion in Iranian funds they
        had allegedly misappropriated was dismissed on grounds of forum
        non conveniens because Shah had no connection with forum state.
        Court of appeals affirmed even though id appeared from the record
        that no alternative forum was available to P because of the
        political situation in Iran. Court of Appeals held that courts are
        not required to entertain litigation that had no connection with
        the state, especially when the burden on the state’s courts
        would be tremendous and the availability of another forum is just
        a “most important” factor to be considered.
The Erie
Doctrine
  1. State
    Law in the Federal Courts

    1. Analyzing
      Erie
      Problems

      1. Is this strictly a
        diversity case?

        1. If
          yes, go to 2.
        2. If
          no, ignore Erie.
      2. Is
        there a federal statute on point?

        1. If
          yes, ignore Erie.
        2. If no, go to 3.
      3. Is
        there a Federal Rule of Civil Procedure on point?

        1. If yes, go to 4.
        2. If no, go to 5.
      4. Can
        both the Federal Rule and state policy be followed simultaneously?

        1. If yes, follow both
          Federal Rule and state policy.
        2. If
          no, ignore Erie;
          ask only whether Federal Rule is valid under the Rules Enabling
          Act (Hanna).
      5. Does
        the federal policy conflict with the state rule or policy?

        1. If yes, go to 6.
        2. If no, follow the
          federal policy.
      6. Is
        the area one of the few areas suitable for federal common law
        (e.g., a defense raises a federal question)?

        1. If yes, use federal
          common law.
        2. If no, go to 7.
      7. Is
        the state policy or rule basically procedural or basically
        substantive?

        1. If basically
          procedural, go to 8.
        2. If
          basically substantive, follow the state policy or rule, as
          required by Erie
          v. Tompkins
          .
      8. Is
        the state policy weightier than the federal policy, viewed in the
        context of a federal diversity suit? Consider
        outcome-determinitiveness and forum shopping as non-dispositive
        factors in deciding this.

        1. If
          state policy is weightier, follow the state policy. (Example:
          Follow state statutes of limitations in Guaranty
          Trust v. York
          .)
        2. If
          federal policy is weightier, follow the federal policy. (Example:
          In deciding judge-jury allocation, follow federal, not state,
          principles. Byrd
          v. Blue Ridge
          .)
      9. Always
        analyze policy factors

        1. Trying to discourage
          forum shopping
        2. Trying to create
          uniformity (equal remedies under state & federal law)
    2. The
      Rule of
      Swift
      v. Tyson

      1. Rule:
        Federal courts must follow only state statutory laws, not state
        judge-made common law, in cases in which state law applies. There
        was a caveat, which was that federal courts had to follow state
        laws and a whole bunch of other local laws pertaining to real
        estate, etc.

        1. §1652
          Rules of Decision Act
          :
          The laws of the several states, except where the Constitution or
          treatises 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.
      2. Rationale:
        Decisions are not “laws” within the meaning of the Rules of
        Decision Act. Common law is judge made law and doesn’t’ count.
    3. The Erie Doctrine:
      The Rules of Decision Act and The Rules of Enabling Act

      1. Reasons for
        overruling Swift v. Tyson:

        1. Swift
          interpreted Rules of Decision Act incorrectly.

          Professor Charles Warren published an article in the Harvard Law
          Review that found an older version of the RDA that said federal
          courts were supposed to apply state law, both written and
          unwritten.
        2. Swift
          failed at creating uniformity.

          The Court had hoped the states would see what the “enlightened”
          view of the federal courts were and apply them in state courts,
          but instead they kept applying their own laws. Also created some
          uncertainty of its own because it was difficult to determine what
          was local law and what had to be followed, etc.
        3. Swift
          created discrimination
          .
          At first it was just that diversity cases in federal court got a
          different result, but then it became an incentive for people to
          create or destroy diversity (Taxi cab case) and the Court thought
          that was sleazy.
        4. Swift
          is unconstitutional.

          There is no federal common law and Swift allowed federal courts
          to disregard state law and thus basically trounce state rights in
          violation of the 10th amendment.
      2. Erie
        R. Co, v. Tompkins

        1. Rule:
          Federal courts are required to apply the substantive common law
          of the state in which they sit.
        2. Rationale:
          This
          case articulates what is known as the “Erie doctrine”:
          a federal court sitting in diversity applies substantive state
          law. Erie expanded the definition of Section 34 of the Judiciary
          Act of 1789 to include state court decisions. The two policies
          emphasized in Erie: uniformity of state court decisions and
          prevention of discrimination between residents and non-residents,
          are mentioned frequently in subsequent decisions that support and
          refine Erie.
        3. Concurrence,
          Reed
          :
          The Swift
          doctrine should have been overturned without analyzing the
          constitutionality of that decision. The majority should have
          read “laws” to include judge-made law rather than addressing
          the constitutionality of Swift‘s
          interpretation. Also, procedure may not be a rule of decision
          (what law must get applied) so might not have to apply state law
          anyway. Can make up procedural laws but must follow state law
          when it is substantive laws.
        4. Dissent,
          Butler
          :
          No constitutional question was suggested or argued, and it was
          unnecessary in adjudicating this case. Congress requires that
          the court first certify the constitutional question to the
          Attorney General so that the US might intervene as a party and be
          heard.
      3. Outcome
        Determinative Test –
        Guaranty
        Trust Co. v. York

        1. Rule:
          In a
          diversity suit brought in equity, an equitable right created by a
          law of the state whose laws govern the case must be followed by a
          federal district court if applying the federal law would
          significantly affect the outcome of the case.
        2. Reasoning:
          If it is a substantive right, then the federal court must apply
          state law. If it of remedial character, such as enforcing the
          right, then the federal court need not follow state law. It is
          not about whether or not the rule is procedural but whether it is
          a means or a mode or a matter of substance. Another way of
          putting this test is to ask if applying federal v. state law
          would change the result of the suit. If it changes the result,
          then it is bound up in the state substantive right. If does not
          change the result or if it just marginally changes it, then it’s
          merely a means and mode of enforcing that right.
        3. Why this test?
          1. Sovereignty
            – apply state law but in federal court way
          2. Practical
            – federal court does not want results to be different
            depending on federal or state court – no forum shopping or
            discrimination in results (outcome determinative test)
          3. Since fed court gets
            to apply same means and mode, fairly uniform procedure in
            federal court
        4. Dissent:
          Rutledge doesn’t like this outcome because he thinks that federal
          courts always did their own thing procedurally and he doesn’t
          think they should be required to switch over to doing what state
          courts are doing simply because of Erie. He also points out that
          if this is what Congress wanted after Erie then they would’ve
          changed it in the 7 years since the Erie decision. He thinks they
          are making federal courts too much like state courts.
      4. Use
        State Statute Of Limitation Rules – Note Case:
        Ragan
        v. Merchants Transfer & Warehouse Co.

        1. P tried to use Rule 3
          of the Federal Rules of Civil Procedure on statute of
          limitations, D wanted to use KS law. The Supreme Court held that
          Rule 3 of the Federal Rules was not intended to govern questions
          concerning the tolling of statutes of limitations, and,
          therefore, state law would determine in diversity when the
          statute was tolled.
      5. Security
        For Expenses Bond – Note Case:
        Cohen
        v. Beneficial Industrial Loan Corp.

        1. The Court held that a
          federal court must apply a New Jersey statute requiring a
          plaintiff in a shareholder derivative suit to post a
          security-for-expenses bond – even though what is not Federal
          Rule 23.1, which ostensibly governs such cases, did not require a
          bond. The Court found that whether the New Jersey statute was
          classified as procedural or substantive, it created substantive
          liabilities for expenses. Rule 23.1 did not contradict the New
          Jersey statute, but was addressed to independent concerns.
      6. Can’t
        Maintain A Diversity Case In A Forum State When That State’s
        Courts Are Closed To You – Note Case:
        Woods
        v. Interstate Realty Co.

        1. The Court held that
          a TN corporation that had not qualified to do business in MI
          could not maintain a diversity action in a federal court in that
          state if, by virtue of its failure to qualify, the MI state
          courts were closed to it.
      7. Substantive
        Right + Outcome Determinative + Federal Policy –
        Byrd
        v. Blue Ridge Rural Electric Cooperative, Inc.

        1. Rule:
          Federal courts may apply federal rules, even if state rules are
          outcome-determinative, if federal policy in enacting the rules
          outweighs state policy.
        2. Rationale:
          Although
          the test for determining whether a state law should be applied
          under Erie is whether it is “outcome determinative,”
          the court must weigh the state’s interests in applying its own
          law against the federal interest in applying federal law.
      8. Slight
        Federal Interest Not Enough – Note Case:
        Allstate
        Ins. Co. v. Charneski

        1. Federal
          interest involved in this case not enough (unlike in Byrd):
          slight federal interest consisted of general interest of the
          court controlling its own procedure, general policy evidenced by
          the federal Declaratory Judgment Act, federal government provides
          a fair and orderly forum in which to try the diversity case,
          relief under the Federal act is expressly discretionary
          (permissive and not absolute). (no right to jury trial involved
          here, WI law more connected with suit than federal government) 
          create unnecessary federal-state conflict.
      9. Pre-Byrd
        Case – Note Case:
        Bernhardt
        v. Polygraphic Co. of America, Inc.

        1. The Supreme Court
          held that a stay pending arbitration could be denied because VT
          law, which permitted revocation of an arbitration provision any
          time before an award was made, governed the arbitration
          provision. They stated that if a federal court allows arbitration
          where state court would disallow it, the outcome of litigation
          might depend on the courthouse where the suit is brought.
      10. IS
        IT
        ARUGABLY
        PROCEDURAL?

        The
        New Test Is Follow The Federal Law Unless It Is Invalid Under REA
        Because It Modifies, Expands, Etc. A Substantive Right Or Is
        Unconstitutional –
        Hanna
        v. Plumer

        1. Rule:
          If
          the rule at issue is procedural and the federal rule is on point
          with the state rule, then the Federal Rule must be applied as
          long as it complies with the Rules Enabling Act, 28 U.S.C. §
          2071 and the U.S. Constitution. If there is no federal rule on
          point, then the Erie doctrine should apply.

          1. Congress
            passed Rules
            Enabling Act § 2072

            in 1934:
          2. The Supreme Court
            shall have the power to prescribe general rules of practice and
            procedure and rules of evidence for cases in the United States
            district courts (including proceedings before magistrates
            thereof) and courts of appeals.
          3. Such rules shall not
            abridge, enlarge or modify any substantive right. All laws in
            conflict with such rules shall be of no further force or effect
            after such rules have taken effect.
        2. Rationale:
          Under
          Guaranty
          Trust Co.,

          whether the state or federal law is to be applied is not just
          whether the law is substantive or procedural, or whether it is
          outcome determinative, but whether it complies with the policies
          underlying the Erie doctrine.
          Rule
          4(d)(1) is not prohibited by the Constitution. Congress created
          the Federal Rules to create uniformity in the federal court
          system. The Erie doctrine and the extensions in York and Ragan
          were not meant to block the federal rules if they are “outcome
          determinative” or have “integral relations.”
          Service of process is not a substantive right intended to be
          enforced by the Erie decision because the method of service here
          only “altered the mode of enforcing state-created rights”
          rather than changing the actual rights. The majority opinion
          illustrates that the federal interest in creating a uniform code
          of procedure for the federal court system is secondary to the
          state’s procedural laws. In the event there is a direct conflict,
          the federal law must prevail so long as it complies with the
          Rules Enabling Act and the U.S. Constitution.
        3. Concurrence:
          Justice
          Harlan: The Court should focus on whether the rule applies to a
          situation that is normally one left to state regulation.
      11. Helps
        in Determining Procedural/Substantive – Note Case:
        Sibbach
        v. Wilson & Co.

        1. State law had a
          rule against compulsory physical examinations. District Court
          ordered P to undergo such an examination pursuant to Federal Rule
          35. Supreme Court affirmed that decision because it felt that
          Rule 35 does not abridge, enlarge, or modify substantive rights,
          in the guise of regulating procedure. The test must be whether a
          rule really regulates procedure – the judicial process for
          enforcing rights and duties regulated by substantive law and for
          justly administering remedy and redress for disregard or
          infraction of them.

          1. This is a good case
            that demonstrates how to determine if something is a means to an
            end (procedural) or the ends (substantive). Although poking and
            prodding seems like it would be a substantive right, it is the
            means to determine how much he would be owed if he were to prove
            his case.
      12. Walker v.
        Armco Steel Corp.

        1. Rule:
          A
          state’s provision tolling its statute of limitations should be
          analyzed under the Erie doctrine. Consequently, a state’s tolling
          provisions must apply if it would have prevented the plaintiff
          from filing a suit in state court. In addition, Rule 3 does not
          conflict with tolling provisions because it only refers to the
          time a lawsuit commences under the Federal Rules.
        2. Rationale:
          Under
          Hanna, a federal procedural rule must directly conflict with the
          state law dealing with the same issue in order for the federal
          rule to apply. In this situation, Rule 3 was interpreted not to
          address the statute of limitations, and thus did not fall into
          “direct conflict” with the Oklahoma state tolling
          provisions. Since there was no federal rule, the old test would
          apply and it would have to be determined if it was means/mode or
          substantive and if it was outcome determinative (and if there is
          a federal interest).
      13. Procedural
        Federal Rules Trump State Law – Note Case:
        Burlington
        Northern R. Co. v. Woods

        1. D
          had obtained a jury verdict against P in a PI action prosecuted
          in an AL federal district court. After verdict had been affirmed
          on appeal, court assessed penalty prescribed by AL law, but D
          objected because it felt Rule 38 of FRCP applied (penalty only
          applied if appeal was frivolous). The Supreme Court held that
          Rule 38 controlled because under
          Hanna
          ,
          the rule must be applied if it represents a valid exercise of
          Congress’ rulemaking authority, which originates in the
          Constitution and has been bestowed upon this court by the Rules
          Enabling Act. Rule 38 regulates matters that can reasonably be
          classified as procedural, thereby satisfying the constitutional
          standard for validity. Its displacement of the AL statute also
          satisfies the statutory constraints of the REA. The choice made
          by the drafters of the FR in favor of a discretionary procedure
          affects only the process of enforcing litigants’ rights and not
          the rights themselves.
      14. If
        There Is Federal Law On Point Follow It, Unless It Violates The
        REA Or Is Unconstitutional
        Organization,
        Inc. v. Ricoh Corp.

        1. Rule:
          The
          federal policy of having district court judges consider interests
          Congress has enumerated in a statute prevails over a state policy
          disapproving certain means by which venue might be decided.
        2. Rationale:
          1404(a)
          says if the balance of convenience favors it, you can transfer
          from one venue to another. Court says this is sufficiently broad
          because it allows judge to consider many different factors when
          determining if transfer is appropriate whereas state law says
          consider anything you want except forum selection clauses. It
          gives an answer to the question, so we are in new test land. The
          Alabama law articulated a clear policy against forum selection
          clauses. The federal statute, by contrast, required consideration
          of various factors such as bargaining power and convenience when
          evaluating the validity of the forum selection clause. The laws
          conflict because the Alabama law does not require consideration
          of these additional factors. Therefore, federal law prevails.
    4. The Problem of
      Ascertaining State Law

      1. Determining Which
        State’s Law Governs

        1. Choice-of-law
          Rules:
          Choice
          of law is a concept within the field of the conflict of laws,
          relating to relationships between individual states. Under
          certain circumstances, the courts of a particular legal
          jurisdiction will be called upon to apply the law of a different
          jurisdiction. This usually arises in the context of lawsuits
          arising from torts or contracts.
        2. Conflict
          of Laws –
          Klaxon
          Co. v. Stentor Electric Mfg. Co.

          1. The
            federal court must apply state law governing conflict of laws.
            In other words, the conflict-of-law rules of the state where
            the federal court sits

            must be followed. The proper function of a federal court is to
            ascertain what the state law is, not what it ought to be.
        3. States
          Given Significant Leeway In Establishing Choice-of-Law Rules –
          Note Case:
          Allstate
          Ins. Co. v. Hague

          1. The Supreme Court held
            that a state could apply its 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.
        4. If
          Case Is Transferred Under 1404(a), State Law Travels With Case –
          Note Case:
          Van
          Dusen v. Barrack

          1. A change of venue
            under § 1404(a) generally should be, with respect to state law,
            but a change of courtrooms.
      2. Ascertaining The
        State Law

        1. Even when you figure
          out which state’s law to apply, discerning what the “state
          law” actually is often presents a problem.

          1. Black Letter:
            Federal Court must apply the law of the state as that law is
            either declared by statute and interpreted by the highest ct of
            the state, or judicially declared by the highest ct of
            the state.
          2. When decisions of
            the state’s highest court are very old or nonexistent, fed
            court may look to lower court decisions (if available) or try to
            declare state law as it would be declared by the highest state
            court if the issue were to be presently tried before it.
        2. Court Does Not
          Have to Apply State Law When Obvious That Highest Court Of That
          State Wouldn’t Even Apply That Law –
          Mason v.
          American Emery Wheel Works

          1. Rule: The
            District Court does not have to apply the state law to be
            applied pursuant to the Erie doctrine if it is clear that the
            highest court of that state would not follow the case precedent
            that addresses the issue.
          2. Rationale:
            Federal district court applied state tort law as articulated
            in a 1928 Mississippi decision (no duty where no privity).
            Although that decision was never explicitly overruled, a much
            more recent decision talked about “modern trends” in the
            area and quoted with approval recent authorities in support of
            the “modern doctrine” (duty even w/o privity). On appeal,
            held that the Mississippi Supreme Court would undoubtedly agree
            w/the MacPherson decision were the issue put before it so case
            remanded to be decided under that standard. The majority’s
            opinion demonstrates a situation where the federal court does
            not have to apply a state’s case law under the Erie doctrine.
            However, the court as well as the concurring opinion, emphasize
            that the highest court of the state’s intent not to follow the
            relevant case law must be clear.
          3. Concurrence: It
            is clear that the dicta in E.I. Dupont implies that the Supreme
            Court of Mississippi no longer approves of the holding in Ford
            Motor Co. However, when the situation is less clear, applying
            the rule of this case will cause problems.
        3. If State’s
          Highest Court Has Not Addressed Issue, Look to All Relevant
          Sources of State Law, Including Decisions in Analogous Cases and
          Dicta – Note Case:
          McKenna v. Ortho Pharmaceutical

          1. Court of Appeals,
            trying to avoid “speculative crystal-ball gazing,” posited
            that the process of ascertaining the law requires an examination
            of all relevant sources of that state’s law in order to
            isolate those factors that would inform its decision. In the
            absence of authority directly on point, decisions by that court
            in analogous cases provide useful indications of the court’s
            probable disposition of a particular question of law. Considered
            dicta by the state’s highest court may also provide a federal
            court with reliable indicia of how the state tribunal might rule
            on a particular question.
        4. It Is Never
          Appropriate For a Diversity Court to Decline to Exercise
          Jurisdiction When State Law Is Uncertain – Note Case:
          Meredith
          v. Winter Haven

          1. In the absence of some
            recognized public policy or defined principle guiding the
            exercise of the jurisdiction conferred, which would in
            exceptional cases warrant its non-exercise, it has from the
            first been deemed to be the duty of the federal courts, if their
            jurisdiction is properly invoked, to decide questions of state
            law whenever necessary to the rendition of a judgment. Where
            such exceptional circumstances are not present, denial of the
            opportunity to afford suitors the opportunity to assert their
            rights in federal courts merely because the answers to the
            questions of state law are difficult or uncertain or have not
            yet been given by the highest court of the state, would thwart
            the purpose of the jurisdictional act.
        5. Federal Court
          Can Stay Proceedings For Interpretation by State’s Highest
          Court – Note Case:
          Louisiana Power & Light Co. v.
          City of Thibodaux

          1. A District Court,
            sitting in diversity, on its own motion, stayed its own
            proceedings to permit LA’s highest court an opportunity to
            interpret a state expropriation statute. The Supreme Court
            upheld this exercise of equitable discretion as a wise and
            productive discharge of judicial duty.
        6. Court Can
          Decline Certification if Delay Would Harm Interests of One or
          Both Parties – Note Case:
          Tunick v. Safir

          1. A photographer
            challenged a locality’s refusal to grant him a permit to
            conduct an outdoor photo shoot in NY based on a NY statute that
            bans public nudity. Court of Appeals petitioned NY’s highest
            court to resolve scope of ban, emphasizing the need for
            expedition given the important 1st Amendment rights at stake.
            Court declined to hear case because even with an expedited
            schedule, Court’s decisional process would add months to the
            case.
        7. Most Courts Are
          Hesitant to Read Law Where There Is None – Note Case:
          Pomerantz
          v. Clark

          1. In a diversity action
            by policyholders against an insurance company to retrieve for
            the company certain sums allegedly improvidently and illegally
            loaned, District Court held that no action was maintainable
            under MA law and stated that a federal judge sitting in a
            diversity jurisdiction case has not a roving commission to do
            justice or develop the laws according to his or what he believes
            to be the sounder, views. His task is to divine the views of the
            state court judges. The emphasis is on precedent and adherence
            to the older ways, not on creating new causes of action or
            encouraging the use of novel judicial remedies that have sprung
            up in less conservative communities. This basic philosophy
            permeates the Mass. Rules governing derivative suits.
            Therefore no action is maintainable under Mass. Law.
        8. District Court
          Required to Adhere to Circuit Decisions When No State Cases On
          Point – Note Case:
          Factors Etc., Inc. v. Pro Arts, Inc.

          1. Federal court
            sitting in New York was required to apply TN law to the question
            of whether Elvis Presley’s right to publicity survived his
            death.  TN state courts had never addressed that issue, but
            the Sixth Circuit (which includes TN) had. The District Court
            was bound by the Sixth Circuit’s view of TN Law.  Sixth
            Circuit was more familiar with TN law since it frequently was
            required to interpret TN law.
          2. Dissenting
            Opinion:
            There was no reason to follow the 6th Circuit
            views when they were not derived from the laws or decisions of
            the state.  Considering the physical size of the circuit,
            and the relatively small number of diversity cases, 6th Circuit
            was unlikely to have any special familiarity with TN law.
    5. Federal “Common
      Law”

      1. Three Perspectives on
        the Scope and Legitimacy of Federal Common Law Making Powers

        1. Meltzer, State Court
          Forfeitures of Federal Rights

          1. In a variety of
            subject matter jurisdictions, there may be federal common law:
            US as party, strong federal interest, interstate disputes, etc.
          2. Lawmaking power of
            federal courts is far more limited than Congress for 2 reasons:
            1. Ideas of separation of power and supremacy of Congress. 2.
            Federal law is and should be “interstitial”, operating
            against a background of existing bodies of state law.
          3. Court has
            recognized that federal common law may be necessary expedient.
          4. Fed. Common law
            fits most easily when it supplements federal constitutional or
            statutory provisions, providing rules of decision that implement
            or safeguard norms embodied in such provisions.
        2. Field, Sources
          of Law: The Scope of Federal Common Law

          1. The received academic
            tradition on common law assumes that there are particular
            enclaves in which federal common law is in fact appropriate, but
            that after Erie federal common law power is the
            exception, not the rule.
          2. He suggests that
            judicial power to act is not limited to particular enclaves and
            that it is much broader than the usual references to judicial
            power would suggest.
          3. He also suggests the
            only limitation on courts’ power to create federal common law
            is that the court must point to a federal enactment,
            constitutional or statutory, that it interprets as authorizing
            the federal common law rule.
        3. Kramer, The
          Lawmaking Power of the Federal Courts

          1. Defines federal common
            law as any rule articulated by a court that is not easily found
            on the face of an applicable statute.
          2. Asks: Why let courts
            make common law in a representative democracy?
          3. Answers: Because
            judge-made law is unavoidable.
          4. Federal common law has
            developed in several broad situations: in cases involving
            important federal interests, in admiralty context, and in cases
            implicating international relations of the United States.
      2. Two reasons we
        need federal “common law”

        1. Gap cases – In a
          perfect world when Congress passed a statute, it would tell
          everything that needed to be known. However, we do not live in a
          perfect world and when Congress passes a statute they usually do
          so with broad, general terms. It is then up to the courts to fill
          those gaps using federal law or state law. (Usually federal
          question cases)
        2. Federal interest
          cases
          – Cases where we aren’t necessarily suing under a
          federal statute (maybe on diversity grounds) but there is some
          federal ingredient involved (area of federal interest) and there
          is no law on point.
          (Usually cases that have failed Erie
          test)
      3. The Traditional
        Bases of Federal “Common Law”

        1. Erie Doctrine Does
          Not Apply In Cases Involving Legal Activities of US –
          Clearfield
          Trust v. US

          1. Rule: When
            application of the law requires a determination of the rights
            and obligations of the United States arising from a federal
            source of law, the Erie doctrine does not apply. Federal courts
            must interpret federal law to determine the legal and factual
            issues of the case.
          2. Rationale: This
            case illustrates that there is still a federal common law in a
            situation where the United States is a party and the issues
            involve rights and obligations of the United States that come
            from federal law. In this case, the Court must use case
            precedent to interpret the United States’ right as drawee to
            collect on a forged check. The Court’s creation of a general
            rule regarding commercial paper demonstrates the Court’s ability
            to create federal common law when circumstances warrant.
          3. Test:
          4. First we must ask
            if the court has the power to displace state law, which we do by
            asking if there is some necessary federal ingredient.
          5. The next question
            is should the court exercise that power.
          6. If there is a
            federal interest and a state law, should ask if state law is
            inconsistent with that interest.
        2. Even When
          Federal Law Controls, State Law Might Be Adopted Instead of
          Creating Federal Common Law – Note Case:
          United States
          v. Kimbell Foods, Inc.

          1. Court broadly
            interpreted Clearfield as permitting federal courts to develop
            federal law for “questions involving the rights of the US
            arising under nationwide federal programs. Having decided that
            federal law controlled, the Court turned to the second and more
            challenging task of determining the content of the federal law.
            After weighing facts of federal interests with respect to
            priority rules for the SBA and FHA loans, the Court held that
            there was no need for an independent federal rule.  Thus,
            the court chose to adopt the state rule as federal law rather
            than to develop a separate federal rule.
        3. No Need For
          Common Law In Every Case Involving Commercial Paper and US,
          Especially When Is Two Private Parties – Note Case:
          Bank
          of America National Trust & Savings Association v. Parnell

          1. Court declined to
            endorse a federal common-law rule of liability and held that
            securities issued by the Government generate immediate interests
            of the Government, but they also radiate interests in
            transactions between private parties and does not touch the
            rights and duties of US (in this case).
        4. Decision That
          May Remotely Affect the US’ Interests Is Not A Strong Enough
          Reason To Warrant Application Of Federal Common Law –
          Miree
          v. DeKalb County

          1. Rule: Federal
            common law does not apply in diversity cases unless the United
            States’ rights and obligations would be substantially affected
            by the outcome of the case. A decision that may remotely or upon
            speculation, affect the United States’ interests is not a strong
            enough reason to warrant application of federal common law.
          2. Rationale: The
            opinion shows that the rule articulated in Clearfield Trust Co.,
            infra, requires a determination of the rights and obligations of
            the United States, not other parties affected. In addition, even
            though federal law specifically states that a contract does not
            allow for a federal cause of action, this does not foreclose the
            possibility of a state cause of action pursuant to the federal
            law. This is why standing was analyzed under state law, to
            determine if Georgia law would allow such a cause of action.
        5. Government
          Contractor Defense –
          Boyle v. United Technologies Corp.

          1. Rule: The
            Supreme Court came up with the government contractor defense,
            which states that if a manufacturer makes a product in
            compliance with the government’s design and production
            requirements, but it was defective and caused injury, the victim
            cannot sue the manufacturer.
          2. Rationale: In
            a 5-to4 decision, the Court held that despite the absence of
            specific legislation immunizing government contractors from
            liability for design flaws, questions of their liability are of
            unique federal concern. As such, to the extent that it holds
            military contractors liable for design flaws, state law may
            significantly conflict with federal interests thereby requiring
            its displacement. The Court added that in the instant case, such
            displacement is appropriate since the United States approved the
            helicopter’s specifications, the equipment met those
            specifications, and Sikorsky warned the government of possible
            dangers in the helicopter’s use. Finally, since the Court of
            Appeals’ use of the “military contractor defense”
            failed to specify if a reasonable jury could have found for
            Boyle, the Court vacated its judgment and remanded.
          3. Dissent: Justice
            Brennan writes: There is no more reason for federal common law
            to shield contractors now that the Government is liable for some
            torts than there was when the Government was liable for none.
            The discretionary function exception does not support an
            immunity for the discretionary acts of Government contractors
            any more than the exception for “[a]ny claim [against the
            Government] arising out of assault,” supports a personal
            immunity for Government employees who commit assaults. In short,
            while the Court purports to divine whether Congress would object
            to this suit, it inexplicably begins and ends its sortilege with
            an exception to a statute that is itself inapplicable and whose
            repeal would leave unchanged every relationship remotely
            relevant to the accident underlying this suit. The tort system
            is premised on the assumption that the imposition of liability
            encourages actors to prevent any injury whose expected cost
            exceeds the cost of prevention. If the system is working as it
            should, Government contractors will design equipment to avoid
            certain injuries (like the deaths of soldiers or Government
            employees), which would be certain to burden the Government. The
            Court therefore has no basis for its assumption that tort
            liability will result in a net burden on the Government (let
            alone a clearly excessive net burden) rather than a net gain.
        6. Note Case: In
          Re “Agent Orange” Product Liability Litigation

          1. The court considered
            the problem of a nationwide class action involving veterans from
            all over the country who alleged injury resulting from the use
            of toxic defoliants in Vietnam. It concluded that every state
            court that would have adjudicated an Agent Orange class action
            would have decided that a national rule of decision would have
            been adopted by all other state courts adjudicating this type of
            case. The need for a uniform rule of decision, the unique
            relationship between the US and its servicemen, and the special
            relationship between the US and its defense would have compelled
            such an adoption.
        7. Note on Federal
          Common Law and Federal Rules of Preclusion

          1. The preclusive effect
            (prevents two bites at the apple) of a federal judgment, even
            when the federal court sits in diversity, is governed by federal
            common law. In determining the content of the federal rule of
            preclusion, the federal court may choose to borrow a state rule.
      4. Federal Law in
        the State Courts

        1. State courts are often
          called upon to construe and apply federal law.

          1. Federal question
            cases: Plaintiff can sue for federal statutes in state or
            federal courts (state courts have concurrent jurisdiction over
            almost all federal actions)
        2. When a state
          attempts to adjudicate such a right, the Supremacy Clause of the
          Constitution requires the application of federal law.
        3. A federally created
          right also may become germane to a state-court action when it is
          interposed as a defense to a claim based on state law.
        4. Federal
          Law is Supreme in State Court When Action Is Brought Pursuant to
          Federal Right –
          Dice
          v. Akron, Canton & Youngstown R. Co.

          1. Rule:
            In
            cases brought under the Federal Employers’ Liability Act
            (FELA), federal law determines issues pertaining to the
            employee’s ability to enforce his federal right. Fact issues
            to be decided under FELA are determined by a jury in order to
            comply with FELA and the Seventh Amendment to the U.S.
            Constitution.
          2. Rationale:
            The
            majority illustrates the supremacy of federal law in state court
            action when the action is brought pursuant to a federal right,
            such as under FELA. In order to reach its decision, the Court
            had to determine that the Ohio rule permitting state court
            judges to determine if fraud had occurred was a substantive rule
            affecting the claim of the Plaintiff based on federal law.
            Because the effect of the application of the state court rule
            regarding judicial finding of fraud is to, in its application to
            the facts presented here, preclude the Plaintiff’s federal law
            claim, the state court rule may not be applied.
          3. Concurrence:
            Justice
            Frankfurter found that the majority’s decision that the validity
            of the release is determined by federal law to be correct.
            However, the requirement by the Court that state courts in FELA
            cases have juries determine issues of fraud is contrary to the
            policy of allowing states to govern their own court systems.
            There is no case or statute requiring that states give jury
            trials for FELA cases so long as the state court does not have
            jury trials for negligence cases. The majority opinion requires
            Ohio to treat its FELA cases differently than other negligence
            cases. This is undue interference with the state court system
            and because it is not required by any precedent or statute, it
            should not be imposed on the state courts.
        5. Local
          Rules Cannot Defeat Federal Rights – Note Case:
          Brown
          v. Western Ry. Of Alabama

          1. The Supreme Court held
            that a log series of cases previously decided, from which it
            sees no reason to depart, makes it their duty to construe the
            allegations of this complaint in order to determine whether
            petitioner has been denied a right granted to him by Congress.
            This federal right cannot be defeated by the forms of local
            practice. Strict local rules of pleading cannot be used to
            impose unnecessary burdens upon rights of recovery authorized by
            federal law.
        6. Note Case: Federal
          Energy Regulatory Commission v. Mississippi

          1. The Supreme Court
            upheld provisions of the Public Utilities Regulatory Policies
            Act of 1978, which required state public utility commissions to
            observer certain federal procedures in regulating energy usage.
            The Court held that the state commissions could be required to
            enforce federal standards.  It upheld the mandatory
            consideration requirement on the ground that Congress, having
            power to preempt state regulation entirely, could adopt the less
            intrusive scheme of PURPA.

Modern
Pleading

  1. Pleadings
    1. Traditionally,
      pleading rules served four functions:

      1. Providing notice of the
        nature of a claim or defense
      2. Identifying baseless
        claims
      3. Setting each party’s
        view of the facts
      4. Narrowing the issues
    2. Modern pleading rules
      are generally not calculated to perform the last three of these
      functions.
    3. The Complaint
      1. Detail Required Under
        the Codes

        1. Although a majority of
          states have adopted the federal pleading rules, a number still
          follow all or part of the codes.
        2. Not Sufficient
          Complaint –
          Gillispie v. Goodyear Services Stores

          1. Under NC code then in
            force, P was required to make a “plain and concise statement
            of the facts constituting a cause of action.” NC cases
            interpreting the pleading standards had stated that the
            complaint must “disclose the issuable facts” and allege “the
            material, essential, ultimate facts upon which P’s right of
            action is based.” The court held that the allegations in P’s
            pleading were insufficient, noting that the pleading was
            necessary not only to enable the opposing party to respond, but
            also to enable the court to declare the law upon the facts
            stated. The court could not do so if “a mere legal conclusion”
            such as “assault” or “trespass” is stated.
        3. Yes –
          Sufficient Complaint – Note Case:
          Robinson v. Board of
          County Commissioners

          1. P alleged that D “did
            then and there falsely, maliciously, and without just cause
            arrest P on charges of disorderly conduct and resisting arrest
            and take him to the police station where he was forcibly
            imprisoned, kept, detained, and restrained of his liberty.”
            Court held that this passage stated facts sufficient to
            constitute a cause of action.
      2. Detail Required
        Under the Federal Rules

        1. Federal Rule
          8(a)
          : Pleading must contain short and plain statement showing
          entitlement to relief.
        2. Complaint Need Only
          State a Claim Upon Which Relief Can Be Granted –
          Dioguardi
          v. Durning

          1. Rule: A
            complaint need only state a claim upon which relief can be
            granted. It does not necessarily have to contain facts that can
            support a cause of action.
          2. Rationale: This
            case illustrates the standard for evaluating a complaint against
            a motion to dismiss under Federal Rules of Civil Procedure
            12(b)(6) (failure to state a claim upon which relief can be
            granted). This standard is known as “notice pleading.”
            A complaint need only state grounds that would entitle the
            plaintiff to relief. It need not contain specific allegations of
            facts that would constitute some specific cause of action. A
            complaint can be vague and incoherent, but if there is a
            discernable ground for relief, the complaint should not be
            dismissed for failure to state a claim.
        3. Complaint
          Shouldn’t Be Too Specific – Note Case:
          Conley v.
          Gibson

          1. The FRCP does not
            require a claimant to set out in detail the facts upon which he
            bases his claims. To the contrary, all the Rules require is a
            short and plain statement of the claim. This is made possible by
            the liberal opportunity for discovery and other pretrial
            procedures.
        4. Key is Short and
          Plain – Note Case:
          Deyo v. Internal Revenue Service

          1. District Court
            conditionally dismissed a pro se complaint for being “neither
            short nor plain.” Rather it consisted of 43 pages of verbatim
            dialogue from telephone conversations and is replete with legal
            argument.
      3. Pleading the
        Right to Relief

        1. Rule 8(a)(2)
          requires a short and plain statement of the claim showing that
          the pleader is entitled to relief
        2. Complaint Is
          Construed In Light Most Favorable to Plaintiff –
          Garcia
          v. Hilton Hotels International, Inc.

          1. Rule: When
            considering a motion to dismiss under Rule 12(b)(6) of the
            Federal Rules of Civil Procedure, all inferences drawn and
            allegations construed are in the light most favorable to the
            plaintiff. If there is some basis that the plaintiff can prove
            at trial that would entitle him/her to relief, then the motion
            to dismiss must be denied. Alternative relief for the defendant
            for a vague complaint is to require the plaintiff to make a more
            definite statement to strike certain allegations that cannot
            contribute to a cause of action.
          2. Rationale: The
            court’s analysis shows that dismissal of a case pursuant to Rule
            12(b)(6) of the Federal Rules of Civil Procedure should not be
            ordered unless there is no basis for relief. Vagueness or
            superfluous allegations will not defeat a complaint.
        3. In current
          practice, Rule 12(e) motions are disfavored (motion for more
          definite statement)
        4. The burden of pleading
          an issue usually is assigned to the party who ahs the burden of
          producing evidence of that issue at trial, although “the burden
          of pleading need not coincide with the burden of producing
          evidence.”

          1. P must plead those
            matters he must prove. If P cannot legitimately allege the
            existence of each of the basic elements of his claim, it may be
            assumed that he could not introduce evidence on them at trial.
          2. Burden is then placed
            on D to answer.
          3. Once D has established
            a defense, P will then have a second burden to introduce
            evidence as to facts that will avoid D’s defense.
      4. Pleading Special
        Matters
Rule 9- Pleading
Special Matters
        1. Capacity

          1. It
            is not necessary to aver the capacity of a party to sue or be
            sued or the authority of a party to sue or be sued in a
            representative capacity or the legal existence of an organized
            association of persons that is made a party, except to the
            extent required to show the jurisdiction of the court. When a
            party desires to raise an issue as to the legal existence of any
            party or the capacity of any party to sue or be sued or the
            authority of a party to sue or be sued in a representative
            capacity, the party desiring to raise the issue shall do so by
            specific negative averment, which shall include such supporting
            particulars as are peculiarly within the pleader’s knowledge.

        2. Fraud,
          Mistake, Condition of the Mind.

          1. In all averments
            of fraud or mistake, the circumstances constituting fraud or
            mistake shall be stated with particularity. Malice, intent,
            knowledge, and other condition of mind of a person may be
            averred generally.

            1. Heightened
              pleading requirements
        3. (g) Special
          Damages

          1. When items of special
            damage are claimed, they shall be specifically stated.
        4. Under
          Rule 9(b), Complaints With Heightened Requirements Should Be
          Construed As To Whether D Can Respond –
          Denny
          v. Carey

          1. Rule:
            Rule
            9(b) of the Federal Rules of Civil Procedure only requires that
            the plaintiff allege the circumstances of fraud such that the
            defendant will be able to sufficiently answer the allegations.

          2. Rationale:
            This case notes that although allegations of fraud require
            greater particularity, the complaint should be construed as to
            whether the defendant is able to respond. The court did not
            focus on whether the defendant was being falsely accused or
            whether this was a “nuisance” suit.
        5. Case Similar to
          Above Is Thrown Out For Not Adhering to Heightened Requirements –
          Note Case:
          Denny v. Barber

          1. In case brought by
            same P as above with virtually identical pleading, court held
            that Rule 9(b) had not been satisfied because the admission of
            P’s counsel that he could provide no further facts in the
            absence of discovery is exactly what courts are trying to avoid.
            The Supreme Court has admonished that to the extent that such
            discovery “permits a P with a largely groundless claim to
            simply take up the time of a number of other people, with the
            right to do so representing an in terrorem increment of the
            settlement value, rather than a reasonably founded hope that the
            process will reveal relevant evidence, it is a social cost
            rather than a benefit.”
        6. Dissatisfied with
          the judiciary’s uneven approach under Federal Rule 9(b) to
          securities-fraud cases (and the fact that too many lawyers were
          filing such cases), Congress imposed a “super-heightened
          pleading standard” on such lawsuits in the Private
          Securities Litigation Reform Act.

          1. The statute requires
            that the complaint specify each statement alleged to have been
            misleading and give the reasons why each is misleading. In
            addition, if an allegation is made on information and belief,
            all facts on which that belief is formed must be stated with
            particularity. Finally, facts giving rise to a “strong
            inference” that D acted with scienter must be stated with
            particularity.
        7. Pleadings on
          Fraud Need Lots of Info Which P Who Has Suffered Great Economic
          Loss Should Be Able to Provide – Note Case:
          Dura
          Pharmaceuticals, Inc. v. Broudo

          1. The Supreme Court
            dismissed a securities fraud action when the complaint alleged
            that the price of the stock “on the day of purchase was
            inflated because of the misrepresentation” because the Private
            Securities Litigation Reform Act of 1995 makes clear Congress’
            intent to permit private securities fraud actions for recovery
            where, but only where, P can adequately allege and prove the
            traditional elements of causation and loss. The Court conceded
            that ordinary pleading rules are not meant to impose a great
            burden upon P, but stated that it should not prove burdensome
            for a P who has suffered a great economic loss to provide D with
            some indication of the loss and the causal connection that P has
            in mind.
        8. Pleadings Are
          Not Supposed to Contain Facts Necessary to Establish a Prima
          Facie Case –
          Swierkiewicz v. Sorema N.A.

          1. Rule:
            Requirements for establishing a prima facie case for employment
            discrimination force P to prove more facts than necessary to
            pass muster under FRCP 12(b)(6).
          2. Rationale: This
            is a case that should turn merely on the facts supporting an
            allegation of employment discrimination.  Here, the lower
            court used the standard for evidence, not for pleading.
            All P had to do here was establish at the very least a
            possibility that D was guilty of the charge in the plea.
            Court held that no one should have to plead more facts than
            they might even use at trial to survive a motion to dismiss.

            There is also a conflict with FRCP 8(a), which states the
            simplified pleas standard is true for all civil rights cases.
            All P had to do under 8(a) was give respondent fair notice of
            the basis for the claim because this is a notice pleading
            system. The court compares the complaint to Form 9 and says
            it is sufficient. The fact that the claim may not survive at
            trial is another story, and not for this Court to decide.
        9. Supreme Court
          says Lower Courts Can Only Apply Heightened Pleading Requirements
          In Cases Specifically Stated in Rule 8 or 9 – Note Case:
          Leatherman v. Tarrant County Narcotics Intelligence &
          Coordination Unit

          1. A unanimous Supreme
            Court held that a federal court may not apply a more stringent
            pleading standard in civil rights cases alleging municipal
            liability under 42 U.S.C. § 1983. Can’t apply heightened
            requirements in cases not specifically listed in Rule 8 or 9 or
            some federal statute. These rules are designed to be exclusive.
        10. Note Case:
          Bautista v. Los Angeles County

          1. In a federal civil
            rights action, the trial court dismissed Ps second amended
            complaint with prejudice. Each judge on Court of Appeals wrote
            separate opinion.

            1. Judge Schwarzer,
              writing for the court, found the complaints to be lacking, but
              reversed the trial court on the ground that it had abused its
              discretion by failing to give P guidance as to how the defects
              in the complaint could’ve been cured and a chance to cure
              them.
            2. Judge Reinhardt
              concurred on the entirely different ground that the complaint
              met the requirements of Rule 8.
            3. Judge O’Scannlain
              dissented because while he agreed that the complaint was
              insufficient, he rejected the notion that the trial judge
              abused his discretion in failing to provide P with guidance on
              how to plead his case.
        11. Courts Don’t
          Like to Seek Info More Appropriate to Discovery – Note Case:
          Pelman v. McDonald’s Corp.

          1. The Second Circuit
            reversed the dismissal of a lawsuit against a fast-food company
            for deceptive business acts in inducing children to buy food
            that causes obesity, declining to endorse a heightened pleading
            requirement that the District Court had imposed because the
            information the DC sought was the sort of information that is
            more appropriate to the subject of discovery.
      1. Alternative and
        Inconsistent Allegations

        1. Under the original
          common-law rules, pleadings were not allowed to contain
          alternative and hypothetical allegations because they would have
          made the search for the single issue impossible.
        2. Under Rule 8(e)(2)
        3. Under Rule
          10(b),
          each claim founded upon a separate transaction or
          occurrence and each defense other than denials shall be stated in
          a separate count or defense whenever a separation facilitates the
          clear presentation of the matters set forth.

          1. If party violates this
            requirement, he will be allowed to amend his pleading to conform
            to the rules.
          2. Hypo: Paragraph 6 of a
            complaint might say that B hit A because he hated her or because
            he didn’t see her and was negligent. It then goes to the jury
            to decide. Can do it in federal court, but not in most state
            courts.
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