Civ Pro 2 Final Flashcards
(173 cards)
1
Q
Where do principles of personal jurisdiction apply?
A
State and federal court
2
Q
What is the source of law for personal jurisdiction?
A
14th Amendment
3
Q
In rem
A
Jurisdiction is based on property and suit is over property.
4
Q
Quasi in rem
A
Suit is not about land, but land formed basis for jurisdiction
5
Q
In personam
A
People suing each other over something unrelated to land.
6
Q
Pennoyer v. Neff
A
- Facts: Initially, attorney Mitchell sued Neff in Oregon state court for unpaid fees. Neff lived outside of Oregon and could not be found. Notice of the lawsuit was published in a church newspaper. Neff failed to appear, and received default judgment against him. Mitchell got an order for the sheriff to sell Neff’s land, which Mitchell bought and assigned to Pennoyer. Neff sued Pennoyer for eviction in federal court, and the trial court found for Neff, saying the original judgment against Neff was invalid due to personal jurisdiction issues
- Holding: Found in favor of Neff. The property needed to be attached before litigation in order for the court to have jurisdiction over it. Substitute notice via publication (e.g. constructive notice) is not acceptable for in personam cases, as the original case with Mitchell was. Needed actual notice to Neff in order for the original decision to be valid. “Presence” or “consent” to jurisdiction.
7
Q
Under Pennoyer, how do you achieve jurisdiction?
A
- D is physically present in state when served
2. D’s property is physically present in state AND attached prior to the suit.
8
Q
What problems are left unsolved after Pennoyer?
A
- Intangible property problem (where is something like IP physically present)
- Transient jurisdiction problem
- Fraudulent inducement into forum
9
Q
What was the basis of the Pennoyer decision?
A
Common law with a focus on state boundaries.
10
Q
Hess v. Pawlowski
A
- Facts: Hess, a resident of PA, was in an accident with Pawloski, MA resident, while driving in MA. A state statute in MA said that a non-resident driving on the roads appointed the state registrar as their agent for personal service simply by driving in the state. Pawloski sued Hess in MA, and served the process on the registrar.
- Holding: A state law may declare that a nonresident motorist impliedly consents to state court jurisdiction and substituted service of process for claims arising from the non residents use of the state’s highways.
- decided under rubric of Pennoyer
11
Q
What justifies the implied consent to personal jurisdiction in Hess v. Pawlowski?
A
The extreme dangers of automobiles.
12
Q
Why do corporations pose a problem under Pennoyer?
A
It’s difficult to determine physical presence for jurisdiction
13
Q
International Shoe
A
- Facts: Int Shoe Co. had 12-13 salesmen in the state of Wash. Int Shoe had no offices there - Delaware corp with headquarters in St. Louis. Salesmen used hotels and public spaces to set up product displays. The state sued Int Shoe for not paying into the state unemployment fund. Personal service on a salesman in the state and service by registered mail were used. Int Shoe made a special appearance at the unemployment office to dispute personal jurisdiction. Decided against them. Wash Superior and Supreme Courts affirmed. Int Shoe appealed to SCOTUS as a 14th Amend due process violation and unconstitutional burden on interstate commerce.
- Holding: Court ruled for the State. Said a corp needs to have “certain minimum contacts with it such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’” A ‘casual presence’ does not open a corp to suits unrelated to its activities, but “systematic and continuous” activities can. The obligations arose out of Int Shoe’s activities in the state, so it is not unreasonable (corp takes the benefits and protections of the state law, so they can face a lawsuit there too).
14
Q
What minimum contacts factors are identified in Int’l Shoe?
A
- Nature and extent of contacts with forum state
- Relationship between contacts and claim
- Inconvenience of traveling to defend
- Liability resulting from privilege of doing business with forum
15
Q
4 personal jurisdiction scenarios identified in Int’l Shoe
A
Scenario 1: Personal Jurisdiction Exists
Quality/nature of contacts high
Relationship of contacts to liability high
Scenario 2: No Jurisdiction
Quality/nature of contacts low
Relationship of contacts to liability low
Scenario 3: General Jurisdiction Alternative
Quality/nature of contacts high
Relationship of contacts to liability low
Scenario 4: Sometimes will be enough, sometimes won’t be (Specific Jurisdiction)
Quality/nature of contacts low
Relationship of contacts to liability high
16
Q
McGee v. International Life Insurance Co.
A
- Facts: California resident buys life insurance from an Arizona company. Arizona company is taken over by a Texas company. Texas company mails a reinsurance certificate to California where the policy holder lives, and where the premium checks are mailed from. Lawsuit over deinial due to policy holder’s suicide brought in California.
- Holding: Due Process Clause does not prevent a California court from entering a judgment binding the Texas company. California has an interest in protecting its citizens when a company refuses to pay out on insurance. Despite an inconvenience to the Texas company, it is not a denial of due process.
17
Q
Illinois Model of Long Arm Statute
A
specific examples of when you can sue nonresidents - “laundry list” (limits Plaintiffs to specific cases)
18
Q
California Model of Long Arm Statute
A
exercising jurisdiction over nonresidents on any basis not inconsistent with the Constitution. (Plaintiff-friendly)
19
Q
Method of Analysis for Long-Arm Statutes
A
- Long-arm statute says there is personal jurisdiction (IL or CA model)
- Is the exercise of jurisdiction consistent with the Constitution?
20
Q
What standard must a federal court meet for personal jurisdiction?
A
Requirements of state where it is located. Use state long-arm statute, then check constitutionality
21
Q
How might a defendant challenge personal jurisdiction?
A
- Show up: file 12(b)(2) motion to dismiss
- Refuse to show up and take a default judgment. P has to go to another forum to execute the judgment, and D can challenge PJ for judgment in the new forum.
22
Q
Hanson v. Denckla
A
- Facts: PA mother sets up DE trust with DE trustee. Mom retires to FL, where she issues occasional orders to trustee that he follows. After her death, children sued trustee in FL, arguing the trust was invalid because Mom exercised too much control.
- Holding: No, there is no jurisdiction for the Florida court over the Delaware bank. SCOTUS said Florida was not involved with the trust was created and Donner’s move to Florida did not create the jurisdiction. “It is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of its laws.”
23
Q
Gray v. American Radiator
A
- Facts: Gray sued Titan Valve Co. in Illinois over a water heater that exploded. Titan made a valve in Ohio and sold it to a Pennsylvania company that used it in making a water heater that was sold to the Illinois resident. Titan challenged personal jurisdiction over it in Illinois.
- Holding: Supreme Court of Illinois upheld jurisdiction. Titan enjoys the benefits from the state laws of Illinois with regard to its transactions there. Does not matter if the purchase was made through a middleman, as production of the valve was presumably made in contemplation of use in the state.
- example of IL long-arm statute*
24
Q
What are the personal jurisdiction factors after McGee/Hanson?
A
- Nature and extent of defendant’s contacts with the forum state.
- Relationship between defendant’s contacts with the forum and plaintiff’s claim
- Inconvenience to the defendant to travel to the forum?
- Did the defendant “purposefully avail” itself of the privilege of doing business in forum? (enjoy benefits/privileges of forum state)
- Interest of plaintiff in litigating in the forum
- Interest of the forum state
25
World Wide Volkswagen v. Woodson
- Facts: NY resident purchases an Audi car from a dealer in NY. Traveling to AZ, in a car accident in OK. Brings a products liability claim in OK over a defective gas tank (car rear ended, catches fire) against a number of defendants, including the car dealer and distributor. Dealer and distributor claim no jurisdiction by OK court. District court denied the claim. OK Supreme Court agreed based on a long-arm statute, because clearly good sold by the defendants were used in OK (even though the dealer and distributor had no business at all in OK).
- Holding: Reversed. Reaffirmed minimum contacts rule and also stated that states are co-equal sovereigns and have limits to where their powers can reach. There was no relationship between these defendants and the forum state (and they took no benefits of OK law at all). Foreseeability alone is not a sufficient test under the Due Process Clause, and a unilateral act by one party cannot satisfy the contact requirements. One isolated incident like the accident is not enough.
26
What does WWVW add to the personal jurisdiction analysis?
Adds foreseeability to the analysis. Foreseeability can be a relevant factor–it must be foreseeable that D will be pulled into court in a state, not that a product will end up there. If they have not reached out and availed themselves of the forum, it is not foreseeable that they will be called to defend a suit.
27
Calder v. Jones
- Facts: A writer and editor had a story published in the National Enquirer that defamed an actress. Actress sued in California, even though the writer and editor were resident of Florida, worked in Florida, and did not travel to CA for the article research.
- Holding: Upheld jurisdiction in CA court. The defendants wrote an article aimed at the CA activities of a CA resident using CA sources in a magazine with its largest circulation in CA. The defendants should have "reasonably anticipated being haled into court there." They acted intentionally.
28
Keeton v. Hustler
- Facts: Plaintiff was a resident of NY and sued Hustler, OH Corp, in NH for defamation. NH was only state where the statute of limitations hadn't run. Sued for damage to reputation in NH and nationwide.
- Holding: Upheld the personal jurisdiction for NH and nationwide–sales in NH were related to lawsuit. Said NH had an interest in cooperating with all other states for a unitary proceeding in court on the matter. Court only held Hustler was subject to suit in NH on causes of action arising out of the activity being conducted, but not necessarily all possible causes of action.
29
Walden v. Fiore
- Facts: Professional gamblers were returning from the Caribbean to Nevada. They had a stop in Atlanta where a federal police officer seized cash and wrote a false affidavit about it being from drug activity. The gamblers sued the officer in Nevada court for causing effects in Nevada. 9th Circuit upheld jurisdiction in Nevada.
- Holding: SCOTUS reversed. They said the defendant did not create contacts in Nevada. The plaintiffs were only denied of use of the money in Nevada because they decided to reside there, not because of the officer's actions. Court said, "our 'minimum contacts' analysis looks to the defendant's contacts with the forum State itself, not the defendant's contacts with persons who reside there."
30
Burger King v. Rudzewicz
- Facts: Rudzewicz and MacShara entered into a franchise agreement with Burger King, a Florida company (HQ in Miami), in 1979 after months of negotiation. Rudzewicz is a Michigan resident. Franchise documents indicate the franchise relationship is established in Florida and Florida laws apply, went to Florida for training. Recession hit, the Burger King store lost business, and Rudzewicz fell behind on his payments to corporate. HQ ends franchise and closes store, but Rudzewicz keeps operating it. Burger King sues in Florida federal district court, which exercises personal jurisdiction through a Florida long arm statute. 11th Circuit reverses, says no personal jurisdiction as it would offend the fundamental fairness of Due Process.
- Holding: Reversed, Florida District Court jurisdiction over Rudzewicz did not violate Due Process. Physical entry into the forum state is not required, although a contract alone is not sufficient minimum contacts in a state. Need to evaluate prior negotiations, terms of the contract, contemplated future consequences, etc. Rudzewicz was an experienced businessman who voluntarily accepted the terms of his business with BK HQ in Miami. Not unreasonable for him to expect to be sued in Florida (and the franchise agreement said Florida law applied; choice of forum clause). Substantial and continuing relationship, fair notice of possible suit in Florida.
31
What is the final personal jurisdiction analysis (from Burger King)?
1. Purposeful minimum contacts
- Nature and extent of contact
- Relationship between contact/claim - did they give rise?
- Purposeful availment
- Foreseeability of being hailed into court.
2. Other “fair play” factors (use for cases at the margin/close calls)
- Burden on the defendant
- Interest of plaintiff
- Interest of forum and other state
32
Asahi Metal Industry v. Superior Court
-Facts: Asahi manufactured tire valves in Japan and sold them to Cheng Shin which manufactured tires in Taiwan, and sold them in California. A CA resident is hurt when a valve on a motorcycle tire malfunctions and they crash. Sues Cheng Shin in CA who impleaded Asahi for indemnification.
```
-Holding:
The vote count:
Minimum contacts no: 4
Minimum contacts yes: 4
Stevens - “group hug” - says he doesn’t need to decide purposeful availment issue, but agrees on “fair play” factors from Burger King
```
*Court agrees that there is a burden on the defendants litigating in a foreign legal system.
33
McIntyre Ltd. v. Nicastro
-Facts: Nicastro injured his hand with a metal shearing tool manufactured by J. McIntyre. The injury occurred in New Jersey. J. McIntyre is a company in England with a US distributor. They never marketed products to the states or shipped products to the states. NJ Supreme Ct. found jurisdiction for NJ courts did not violate due process because the injury occurred in NJ, J. McIntyre knew or should have known its products were distributed nationally, and because McIntyre did not try to stop its products from going to NJ.
-Holding: Reversed, no jurisdiction in NJ. "Due process protects the petitioner's right to be subject only to lawful authority." There is no evidence McIntyre acted to avail itself of the benefits or protections of NJ. McIntyre did not target NJ in any specific way, although they did have activities in the US.
Majority of justices conclude:
Limited sales to state that are not purposefully directed there are insufficient to establish minimum contacts
High volume sales to a state through an intermediary, if known to defendant, are sufficient to establish minimum contacts, in absence of other “purposeful” conduct
Secondary factors not in play
- Breyer Concurrence: basically, this is not the case to make a broad rule from, because it does not encompass what are likely all of the modern day considerations we should worry about in commerce.
- Ginsburg Dissent: Targeting the US as a whole is sufficient targeting of every state individually. We cannot allow a big foreign company to use a distributor to avoid jurisdiction.
34
Shafer v. Heitner
- Facts: Plaintiff (non-resident of DE) is a stockholder of Greyhound (DE corp, AZ is PPB). Suing Greyhound, Greyhound Lines, and 28 current or former officers of the company in a shareholders derivative suit claiming they caused the company to lose money in an antitrust situation. The antitrust activities occurred in OR. Sued in DE and attached stock owned by the officers. Court applied a DE law and placed stock transfer orders to seize the stock. Defendant claims no DP of law, the property cannot be attached in DE, and they have insufficient contacts with DE. Court said sequestration was used not to secure possession of property but to compel an in person appearance of a non-resident. Ct. of Chancery said quasi in rem jurisdiction was fine. DE Supreme Ct. affirmed.
- Holding: Reversed. State courts need to follow International Shoe. Extending Int'l Shoe to in rem too. If there is not direct personal jurisdiction over a person, then how is indirect jurisdiction fair? The stocks are not the subject of the lawsuit and do not make for sufficient contacts with DE for a lawsuit. The defendants did not purposefully avail themselves of the laws of the state.
35
What is the effect of Shafer v. Heitner on quasi in rem?
Guts quasi in rem, where property seized has nothing to do with the suit
36
Burnham v. Superior Court
- Facts: A couple living in NJ decided to separate. The wife moved to CA with the kids, and they agreed to file for divorce based on "irreconcilable differences." Instead, the husband files in NJ state court for "desertion." The wife files in CA for divorce and child support (support requires in personam jurisdiction). When the husband came to CA for a business trip and to visit the kids, was there for 3 days, and he was served with the papers. CA court upheld jurisdiction because he was served while physically in the state.
- Holding: Supreme Court upheld personal jurisdiction based solely on the fact that the defendant was physically in the state when served with process. Scalia +3: “tag you’re it” = transient jurisdiction is constitutional because it has historically been permitted. It is a continuing tradition of our legal system and meets 'traditional notions of fair play and substantial justice.' Brennan +3: without transient jurisdiction the party could have full benefits of being able to sue there as a plaintiff with immunity from being a defendant. And if a defendant has already traveled to the forum state once, it cannot be a huge burden to come back to defend.
37
What are the takeaways from Shaffer and Burnham about personal jurisdiction?
- Shaffer: Physical presence of property alone is not sufficient - do normal minimum contacts analysis (so where property is related to suit this will be enough, but quasi in rem is not enough)
- Burnham: “tag you’re it” - Physical presence of person is “more or less enough.” Other justices say you have to be in the forum intentionally.
38
General Jurisdiction
Forum contacts are so omnipresent that it is not a due process problem to hold defendant answerable in the forum for events that did not occur there.
39
Goodyear v. Brown
- Facts: Two boys from North Carolina killed in a bus accident in France that was allegedly caused by a defective Goodyear tire. Parents sue Goodyear USA and 3 foreign subsidiaries in North Carolina; foreign subsidiaries challenge. NC S. Ct. argues that there is general jurisdiction based on stream of commerce.
- Holding: North Carolina did not have general jurisdiction over Goodyear subsidiaries. General jurisdiction exists where the corporation is “at home” in the forum state.
40
Where is a corporation "at home" for purposes of general jurisdiction?
- Where it is incorporated
| - Where its headquarters (nerve center) is located
41
Daimler Case
- Example of contraction of general jurisdiction
- Mercedes Benz USA incorporated in DE with principal place of business in NJ may not be subject to general jurisdiction in CA despite a massive sales presence.
42
Bristol-Myers
- Retracts expansive specific jurisdiction
- Plaintiffs from multiple states (including CA) sue in class action in CA for injuries.
- Holding: CA courts lack PJ over D for injuries that arose outside CA, even though the injuries sustained by CA and non-CA plaintiffs were the same
43
Ford Case
- Facts: Ford vehicles were involved in accidents in Montana and Minnesota, and Ford is sued in both states. Ford is headquartered in Michigan and incorporated in Delaware. In both states, Ford has many dealerships and repair shops, but the vehicles involved in the crashes were not sold in forum states. No general jurisdiction in either forum state because Ford is not “at home.”
- Holding: Ford is subject to personal jurisdiction in this case because Ford’s activities in the forum states influenced the plaintiffs to buy the used cars. There is no causal relationship, but there is a relationship that is meaningfully related to the injury/suit.
44
Specific Jurisdiction
Contacts with the forum clearly give rise to the lawsuit
45
Insurance Corp. of Ireland
- Facts: Compagnie was a DE corp. owned by a PA company and the Republic of Guinea. They sued a foreign insurance company when the insurance company died to pay coverage. Sued in PA district court. Insurance Corp. of Ireland challenges for lack of jurisdiction in the answer and moved for SJ. DC wanted to enter discovery to evaluate the PJ issue. Insurance corp. refused to comply with discovery orders. DC sanctioned Insurance by finding that it had PJ
- Holding: A defendant may waive its PJ defense by entering an appearance and failing to comply with rules requiring it to lodge a timely objection, and entering an appearance, raising the objection, and failing to comply with applicable discovery rules, the violation of which include waiver as an available sanction
46
Carnival Cruise Lines v. Shute
- Facts: Washington plaintiffs bought cruise tickets which contained fine prints saying you must sue in FL. Leave from CA to MX and plaintiff tripped and is injured and sues in WA. Carnival made two arguments. Not only is the forum selection clause valid, but also no PJ in WA. Carnival contacts in WA: sell tickets there, contacts did not directly lead to injury, but there is a relationship.
- Holding: Forum selection clauses are presumptively valid, but subject to scrutiny for issues concerning fundamental fairness. Plaintiffs had the option of rejecting the contract by not going on trip. Not fundamentally unfair, Florida is a logical, sensible forum.
47
Personal jurisdiction/consent mechanisms
- Federal Court: Failing to raise a timely 12(b)(2) defense = waiver (FRCP 12(g)) and 12(h))
- Many State Courts: entering a “general” versus “specific” appearance = waiver
- Litigating PJ in a forum = consent to the jurisdiction of that court to resolve PJ (Bank of Ireland)
- Forum selection clause = consent to the PJ of the forum selected
48
Riley v. Money Mutual
- Facts: MoneyMutual is a nationwide company that gets a finder’s fee for matching people. Sued via class action by people who received loans in MN, alleging that MM was in violation of state laws.
- Holding: Applying minimum contacts, there is personal jurisdiction over MoneyMutual in Minnesota. Emails count toward minimum contacts if the defendant knew where the email was going–here, MoneyMutual knew the loan applicants were in MN when they reached out. Also considers national television advertising (not specifically targeted at MN residents) and Google Adwords (relevant contact).
49
Zippo sliding scale
1. Defendant clearly does business over the internet: jurisdiction
2. Interactive websites where a user can exchange information: maybe jurisdiction
3. Defendant has simply posted information on an internet web site: no jurisdiction
*Some states apply Zippo and others apply Riley, which is on the transactional part of the scale*
50
What is service of process?
How you notify someone of a suit
51
What are the dimensions of service?
- Constitutional (14th amendment)
| - Rule
52
What are the 3 ways to serve someone in federal court?
Rule 4(e) service on individuals in US
1. Follow rules of state where court is located
2. Follow rules of state where person served is located
3. Serve personally at home
53
Mullane v. Central Hanover Bank & Trust Co.
- Facts: New York State banking law allowed small trusts to pool assets into a larger common fund with a single manager. This promoted economies of scale and risk management for smaller trusts that otherwise could not afford corporate fiduciaries. Central Hanover asked the NY court for a settlement of the common trust; it had 113 trusts participating and $3 million. The statute only required publication in the paper for 4 weeks. Central Hanover had also sent letters to everyone when the fund started.
- Holding: Reversed. Notice has to be "reasonably calculated" to inform known parties that are affected by the proceeding. The statute is unconstitutional for notice. That said, notice by publication is acceptable for unknown parties, parties who could not be found through due diligence, and any party whose future interest was not known with certainty.
- Takeaway: Even state service rules should be run through the Mullane test.
54
What FRCP covers service?
Rule 4
55
Under Rule 4(c), who can serve a complaint?
Any person who is (1) NOT a party and (2) over 18 years of age
56
What is venue?
Geographic location where the suit will be litigated
57
What must you have for a forum to be appropriate?
Personal jurisdiction, venue, and subject matter jurisdiction (you may have more than one appropriate forum, then you choose based on strategy/convenience)
58
Under 28 USC 1391, when is venue proper?
1. In a district “where any defendant resides, if all defendants are residents of the same state;” or
2. In a district “where a substantial part of the events or omissions giving rise to the claim occurred;” or
3. A judicial district in which any defendant is subject to PJ at the time the action commenced, IF there is not district in which the action may otherwise be brought.
59
What is the residence for a natural person under 28 USC 1391?
Where they are domiciled (state of which they are a citizen)
60
What is the residence of a corporation under 28 USC 1391?
Where they are subject to a court's personal jurisdiction
| so where they are at home or wherever specific jurisdiction applies
61
Earthdweller v. Rothenagel
- Facts: Catherine and Michael Rogers developed a concept for a business that marketed environmentally sound products. The business was incorporated and has principal place of business in Illinois. Rothenagel was hired as a business consultant, and began expanding the business in MN. The Rogers claim that Rothenagel misappropriated confidential information and trade secrets. They filed the case in Illinois and Rothenagel challenged venue under § 1391(a).
- Holding: Venue was proper in Illinois, no net gain in transferring venue to Minnesota.
- Takeaway: Under § 1404, must show net benefit to convenience overall, with deference to plaintiff’s choice. Burden on movant (usually D) to show net gain to convenience. Under 1404(a), will look at convenience of parties, convenience of witnesses, and the interests of justice (a multi-factored analysis focusing on the administration of the court system - possibility of jury view, access to sources of proof, public interest, familiarity with applicable law, and dockets)
62
What is forum non conveniens?
A doctrine permitting a court to dismiss a case over which it has jurisdiction if an alternate jurisdiction is more convenient for hearing the matter.
63
How does venue differ from forum non conveniens?
- Venue is from a statute, forum non conveniens is from common law
- Venue is designed to promote convenience, but forum non is a booster/supplement to convenience
64
When will forum non conveniens most likely be needed?
- Federal court: When events leading to suit did not occur in the US (see Piper)
- State court: More common here, when case is filed in one state court but logically another state would be the better forum
65
What are the factors considered in a forum non conveniens analysis?
Private Interest Factors:
- Access to proof/premises
- Availability of witnesses
- Other factors that make trial easy/inexpensive
Public Interest Factors:
- Court Congestion
- Local interest in suit
- Competence over applicable law
- Avoiding conflict of laws
- Burden to local jurors
66
Piper Aircraft v. Reyno
- Facts: Pretty complicated, but essentially there was a plane crash in Scotland and the case ended up in PA district court because the US had more favorable product liability laws.
- Holding: Forum non conveniens applies. The American interest in this case is not strong enough to burden the US legal system with such a complicated case. The alternate forum in Scotland is clearly adequate, we give less weight to the forum choice of foreign plaintiffs, Scotland has strong interest in trying case because all of the injured parties were Scottish and the accident occurred there.
67
Strawbridge
For cases in federal court on diversity, there must be complete diversity among parties (no plaintiff and defendant can be from the same state)
68
Mas v. Perry
- Facts: Mr. and Mrs. Mas were graduate students from Louisiana State, he was a French national and she was from Mississippi. The landlord, Perry, watched them through a two-way mirror. They filed suit in Louisiana in federal court. Perry challenged, saying they were not diverse from him.
- Holding: There was diversity jurisdiction because neither Mr. Mas nor Mrs. Mas were domiciled in Louisiana.
69
For purposes of diversity jurisdiction, where is someone domiciled?
Where they take up residence with the intent to remain indefinitely
70
What are the two approaches to determining where corporations are domiciled?
Principal place of business "total activities" analysis:
1. Nerve center approach
2. Locus of operations approach
71
In Hertz, what did the Supreme Court say about determining a corporation's principal place of business?
They adopt the nerve center approach. The principal place of business is where a corporation's officers "direct, control, and coordinate the corporation's activities."
72
Is the threshold amount in controversy satisfied if the ultimate recovery is less than the threshold (as it was in Mas v. Perry)?
Yes, so long as the threshold amount was sought in good faith.
73
Can a single party combine claims to reach the threshold amount in controversy for diversity jurisdiction?
Yes, they may combine related or unrelated claims against the defendant.
74
Can co-plaintiffs meet the diversity threshold requirement if none of them alone have the requisite $75,000 claim?
No, if none of them have $75,000 alone, they cannot combine to reach that amount.
75
Can co-plaintiffs meet the diversity threshold requirement if one of them has $75,000 in controversy and others have less?
Yes, the others may be joined under supplemental jurisdiction.
76
Are state service rules subject to the Mullane test?
Yes
77
What is the waiver process for service under Rule 4(d)?
- Alternative to service under 4e, f, h
- The plaintiff mails complaint to defendant/D's agent and gives them at least 30 days after mailing to return the waiver.
- If D does not comply, they are subject to service costs. If they do comply, they have 60 days to answer (which is an extension on the normal answer period)
78
Rule 4(h) service on corporations/partnerships
Basically the same as individuals:
- Follow service rules of state where court is or where service is accomplished OR
- deliver complaint to officer, general agent, or authorized agent
79
Rule 4(i): service on government
- Serve US attorney/designee AND
- Certified mail to attorney general AND
- Certified mail to officer/agency
80
What is bulge jurisdiction?
- Service reaches party impled under Rule 14 or joined under Rule 19 AND
- within 100 miles of court
81
What is the time limit for service (Rule 4m)
90 days from filing. Extension available if good cause is shown.
82
When would the third category of proper venue under 1391 apply?
When D is not a US entity or if Ds are from different states and none of the events took place in the US
83
What is the legal standard for transfer of venue?
Must show a net gain to convenience overall
84
If we have Art. III, why do we need 28 USC 1332?
- 1332 is an authorizing/enabling statute for what the Const. permits
- 1332 limits diversity to cases over $75K to keep small claims cases out of federal court
- 1332 authorizes suits from different states, but case law (Strawbridge) requires complete diversity among parties.
85
Louisville v. Mottley
- Facts: the Mottleys were injured in a railway accident, the railroad settled the claim with lifetime passes on the train. In 1906, Congress passed an act forbidding railroads to issue free passes. The railroad did not renew their passes and the Mottleys brought suit because it deprived them of their property under the 5th amendment. Mottleys argue that the act of Congress was not intended to forbid passes for people like them who got this compensation before the act was passed. Second, there is a 5th Amendment takings issue, because they are not being compensated. SCOTUS says this is actually a question of jurisdiction for the Circuit Court.
- Holding: Reversed, and Circuit Court needs to dismiss for lack of jurisdiction. Plaintiff's statement of his own case must show that the case comes under the Constitution or the laws of the United States, not that the defendant might raise an issue that could lead to it.
86
Can a federal question be anticipated to get SMJ?
No, the claim must arise from a constitutional question (see Mottley)
87
Gunn v. Minton
- Facts: Minton invents a stock trading computer program and leases it out. He then applies for a patent and files suit against NASD and NASDAQ for patent infringement. He loses the patent case because the system was “on sale” at least a year before the patent application. He then sues his lawyers because they did not raise the “experimental use” defense. To prevail on this, Minton had to show that he would not have lost the case but for the failure on the part of his attorneys.
- Holding: Appropriate for state court to consider this case based on four-factor analysis. The federal issue is necessary and actually disputed, but it is a hypothetical issue and the state court’s resolution of the question would not disrupt federal-state balance.
88
What are the two types of federal question jurisdiction outlined in Gunn v. Minton?
1. Holmes test - when federal law expressly or impliedly creates the cause of action
2. Four factor analysis for "special and small category." Federal question jurisdiction over a state law claim if the federal issue is...
(1) necessarily raised
(2) actually disputed
(3) substantial AND
(4) capable of resolution in federal court without disrupting the federal-state balance
89
Grable & Sons Metal Products v. Darue Engineering
- Facts: In 1994 the IRS seized property belonging to Grable. There is no dispute Grable had actual notice via certified mail. Darue bought the property at auction from the IRS. 5 years later, Grable files a quiet title action in state court against Darue claiming the IRS failed to provide personal service under the statute in question. Darue removed to federal court, based on federal question in interpreting federal tax law. District Court issued summary judgment for Darue, saying Grable's lack of a federal right of action against Darue does not bar an exercise of federal jurisdiction. 6th Cir. affirmed, saying there is a substantial federal interest in construing federal tax law.
- Holding: Affirmed (jurisdiction question only part considered). There is a significant federal issue or an "important issue of federal law" involved. The meaning of federal tax laws is important to the Government, buyers, and delinquents. There needs to be a consideration of the division of labor between state and federal courts established by Congress. But, it is a rare quiet title action that will involve a contested issue of federal law, so jurisdiction is okay here - it won't "materially affect . . . the normal currents of litigation."
90
What are the common features for claims subject to supplemental jurisdiction?
- One party/claim within original jurisdiction
| - Related party/claim not within original jurisdiction
91
What is the policy behind supplemental jurisdiciton
Promoting efficiency when many legal issues arise out of one incident
92
Do pendent and ancillary jurisdiction still exist?
No, they were eliminated by congressional statute in 28 USC 1367 (both of them are considered supplemental jurisdiction)
93
Pendent parties and claims
Raised by plaintiffs
- pendent claim: Rule 18
- pendent party: Rule 20
94
Ancillary parties and claims
Raised by defendants
- ancillary claim: Rule 13a
- ancillary party: Rule 14
95
What is UMW v. Gibbs an example of?
Pendent claim
96
UMW v. Gibbs
- Facts: Tennessee Consolidated Coal Company laid off 100 United Mine Workers Local 5881 workers when it closed a mine. Then, a wholly owned subsidiary called Grundy was planning to open a new mine. They hired Gibbs to be the superintendent and to haul coal to a nearby railroad. Gibbs planned to use Southern Labor Union workers, not United Mine Workers. UMW got wind of this, and showed up, armed, and beat a guy from SLU, the rival union. Gibbs lost his job and alleges he lost other truck contracts due to an effort by the union against him. Gibbs has a federal question claim under Section 303 of the Labor Management Relations Act and a state law claim for malciously interfering with his employment, which was included in federal court under pendent jurisdiction. Jury awards $60k on employment, $14.5k on haulage, and $100k punitive. Trial court sets aside the haulage award for lack of proof, says no Section 303 claim, but a valid state claim. 6th Circuit affirmed.
- Holding: Reversed. The Dist. Ct. did not error by allowing the state law claims. Established the common nucleus of operative fact test, where the claims (federal and state) must come from the same situation and that the plaintiff would ordinarily expect to try it all together in one case. Fed. R. Civ. Pro. want to have the broadest scope of an action that is fair to the parties. That said, pendent jurisdiction is discretionary for the courts, not a right for the plaintiff. The question of a federal court's power to hear a case is usually determined on the pleadings, but pendent jurisdiction is resolved throughout litigation.
97
Must the district court hear a supplemental claim?
The district court has a measure of discretion in deciding to hear these claims. It can be exercised only where it promotes efficiency.
98
When is SMJ determined?
At the time the case is filed. So for supplemental jurisdiction purposes, the other claim can still be heard even if the federal claim is thrown out.
99
Owen Equip. v. Kroger
- Facts: Kroger (Iowa resident) sued Omaha Power (OPPD, a Nebraska corp.) in federal court asserting diversity jurisdiction when her husband died electrocuted from power lines. OPPD filed a third-party complaint against Owen (the crane company from Nebraska). Kroger amended her complaint to add Owen and OPPD filed for summary judgment, and the district court granted the motion leaving only Owen and Kroger. Owen moved to dismiss because of lack of jurisdiction.
- Holding: In an action in which federal jurisdiction is based on diversity, the court may not exercise jurisdiction over the plaintiff's claim against a third-party defendant if there is no independent basis for federal jurisdiction over that claim. Jurisdiction under 28 U.S.C. § 1332 requires complete diversity of citizenship between the parties, or in other words, that each defendant is a citizen of a different state from each plaintiff.
100
What was the response to the Finley case?
Congress enacted 28 USC 1367 to codify Gibbs and Kroger to avoid the end of supplemental jurisdiction altogether.
101
Exxon Mobile/Rosario
Facts:
- Exxon: Was 1367 supplemental jurisdiction appropriate for Rule 23 class action where some members did not meet minimum amount in controversy?
- Rosario: Family members joined suit with girl who was injured from a tuna can, again an issue with minimum amount in controversy
Holding: Majority says that there must be complete diversity, but not all parties need to have above 75K in controversy. However, if there is not complete diversity, then no original jurisdiction.
102
As a general rule, what kinds of cases are removable?
Any civil action where district courts have original jurisdiction (so cases that could have originally been filed in federal court) - 28 USC 1441(a)
103
Plaintiff sues a non-diverse defendant, alleging that defendant's trademark violated plaintiff's rights under state and federal law. Is that removable?
Yes, it is removable because there was a federal question and supplemental jurisdiction for the state claim (so there would be original jurisdiction here)
104
If a plaintiff's suit is against two defendants, may either defendant remove the case?
No, all of the defendants must agree on the removal.
105
If suit is filed in IN state court, where can the case be removed to?
The district court where the state court is located. After removal, D can ask for 1404 transfer of venue if appropriate
106
If an IN plaintiff sues an IL defendant in IL state court for $100,000 in a state trademark claim, can the defendant remove the case?
There would be diversity jurisdiction, but D can't remove since D is "at home" in Illinois.
107
What is the policy disconnect with "at home" parties and removal?
Plaintiff can file diversity action in federal court in its home state, but defendant can't remove diversity action to federal court filed in its home state.
108
What if an Indiana plaintiff files a federal trademark claim against an Indiana defendant in state court and adds an unrelated claim for damages in an auto accident? Is this removable?
Not removable under 1441(a). Under 1441(c), both claims would be removed and then the separate state claim would be severed and remanded to state court. This prevents P from bringing an unrelated claim for the purpose of keeping a case in state court.
109
How much time does a defendant have to seek removal?
30 days once the case has been filed.
110
What if an IN plaintiff files a state trademark claim against an IN defendant in state court, then amends the complaint to include a federal trademark claim six months later. Can the defendant remove?
Yes, the cutoff is one year
111
How can bad faith impact removal?
If plaintiff acted in bad faith to prevent a defendant from removing an action, then the one-year limit can be lifted.
112
How can you file a case to avoid removal?
- If filing a diversity claim, file in the state court where the defendant resides
- Sue for less than the threshold amount
- Add a non-diverse defendant if you can do so legitimately
113
American Car & Foundry on removal
Removal permitted only if defendant removes the jurisdictional spoiler voluntarily
114
What happens if removal is improper?
1446(d) - Case will be remanded to state court
115
Why does the Erie doctrine matter?
1. It's federalism in action
| 2. Litigators need to know when to apply state versus federal law
116
Swift v. Tyson
* note - is no longer good law*
- Issue: Do “laws of several states” include the common law of states?
- Holding: State law includes state statutes, constitutions, and customs. Common law is not the law, it is evidence of the law. Rules of Decision Act only includes state black letter law
117
Erie v. Tompkins
-Facts: Tompkins injured by a train when he was walking along railroad tracks and brings a negligence action. PA common law would consider him a trespasser, but federal common law would impose some standard of care on the railroad.
-Opinion (4 parts):
1. Swift had incorrect reasoning about Rules of Decision Act–it is a misinterpretation and should include state common law (based on some scholar’s analysis of an early draft of RDA).
2. Policy argument: Swift doesn’t work. It allows plaintiffs to forum shop because different standards apply, which promotes discrimination by non-citizens against citizens of a state.
Policy objectives: discourage forum shopping, discourage inequitable administration of state law to detriment of state citizens.
3. Swift was unconstitutional - federal common law does not exist because Congress does not have the power to regulate in this area. Swift’s desire to unify common law is an impossible ideal (law is human institution, so Swift is unrealistic).
Fishy argument because Congress could have regulated railroads via commerce clause.
4. Part 4 exists, but it doesn’t do anything (Geyh’s actual words)
-Concurring/dissenting opinions: Reject constitutionality issue. Justice Reed specifically is concerned about the newly-authorized FRCP and how this decision might disrupt that by requiring the application of state procedural law.
118
Guaranty Trust Co. v. York
-Facts: York sues Guaranty for breach of trust. Guaranty’s defense is that the statute of limitations for state court has run. York argues that when they ask for equitable relief, the statute of limitations should not apply.
FRCP merges courts of law and equity. But courts of law are subject to SoL while courts of equity are not (they are subject only to equitable doctrine of laches).
- Issue: Is the statute of limitations a substantive issue or a procedural one? (shades of Reed’s concurrence in Erie)
- Holding: A rule will be substantive when ignoring a state law would significantly affect the result of litigation. A rule is procedural when it concerns the matter and means by which a right to recover is enforced.
119
Cohen (Erie issue)
```
Facts: State statute provides that plaintiff stockholders must post bonds before filing derivative class actions to reduce vexatious suits. Under FRCP 23, there was no bond requirement for class actions.
This difference is seen as outcome determinative, so it will lead to forum shopping and attempts to bypass state laws. Apply state statute.
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120
What choice of law rules must a federal court apply?
Choice of law is substantive, so federal court must apply the choice of law rules for the jurisdiction where they are sitting.
121
Byrd v. Blue Ridge Rural Electric Coop.
- Facts: Byrd (NC resident) was employed as a lineman in a construction crew as a construction contractor working for Blue Ridge (SC corp) in South Carolina. Byrd was injured and sued in SC district court under diversity for injuries due to Blue Ridge's alleged negligence.
- Erie issue: SC Supreme Court case Adams v. Davison-Paxon ruled that an issue of immunity should be decided by a judge. Federal norm is for a jury to decide this issue.
-Holding: Court balances interests of federal policy favoring jury decision vs. interest in avoiding a different outcome in federal court and applies the federal rule.
There is no certainty that the outcome would be different if a jury made the decision rather than a judge (so this is outcome differential but not determinative)
This was not a state statute, just a court decision made for efficiency purposes. If it was a state statute, the balance might have tipped in the state’s favor.
7th amendment is promoted by abrogating the state right.
122
Rules Enabling Act (28 USC 2072)
Gives S. Ct. power to promulgate general rules of practice and procedure, so long as those rules do not abridge, enlarge, or modify a substantive right.
123
Hanna v. Plumer
- Facts: A fatal accident in which Hanna survived and the other driver died. Hanna filed in federal court, based on diversity jurisdiction against the other driver’s estate. The summons and complaint was served to the executor of the estate’s home, to his wife. Under the federal laws, it is admissible to serve the wife, under state law executors are not liable unless they are personally served.
- Issue: If a plaintiff serves a defendant properly under federal rules, the plaintiff can proceed with a state-law claim that requires a different method.
- Holding: The difference in the rules does not alter the choice of forum. The Dist. Ct. should apply the FRCP 4(e)(2) as it did not exceed constitutional bounds or the Rules Enabling Act from Congress. The "twin aims of the Erie rule: discouragement of forum shopping and avoidance of inequitable administration of the laws." It is important to look at the outcome under state vs federal to see if it is materially different, but here not enforcing the FRCP would "disembowel either the Constitution's grant of power over federal procedure or Congress' attempt to exercise that power in the Enabling Act." We cannot have that; the rules are in direct conflict, and the court should use the federal rule. Here with a Federal Rule on point (direct conflict), apply the Rules of Enabling Act analysis, otherwise with no federal rule on point apply the Rules of Decisions Act analysis.
124
Burlington Northern Railroad v. Woods
-Facts: Tort action for personal injury removed to federal court on diversity. Court of Appeals imposed Alabama state rule for frivolous appeal, which was in conflict with Rule 38 of FRAP.
-Erie Issue:
Alabama statute imposes mandatory 10% penalty on the court’s judgment for frivolous appeals.
Rule 38 gives judges discretion on penalizing frivolous appeals.
-Holding: The federal and state rules directly conflict because the Alabama statute takes away the court’s discretion. Because FRAP 38 regulates matters that can “reasonably be classified as procedural,” it is valid and should be applied.
125
What is the general attitude toward federal rules in Erie analysis?
The process for creating a federal rule is so extensive that those rules will be presumptively valid (unlikely to be found unconstitutional)
126
Walker v. Armco Steel
- Facts: Walker filed a products liability suit against Armco in federal court on the basis of diversity citizenship. The complaint was filed before the Oklahoma SOL had run on the claim but service was not made until after the SOL.
- Issue: Conflict between Rule 3 FRCP and state statute of limitations, does Rule 3 impact state SOL?
- Holding: The Oklahoma SOL is a substantive decision made by the state and service of process is an integral part of the SOL. Since there is no controlling federal counterpart, ther Oklahoma statute governs this case, and the motion to dismiss is correct.
127
Stewart Org. Inc. v. Rioch Corp.
- Facts: Stewart brought suit against the Ricoh in federal court for breach of dealership agreement. The agreement had a forum selection clause that stated any dispute would be heard in a court in Manhattan, Ricoh filed a motion to transfer under 28 USC 1404(a)
- Issue: A federal court sitting in diversity should apply the federal law (1404) motion to transfer a case to a venue provided in the forum selection clause
- Holding: when determining whether the statute is broad enough to cover the issue in dispute and whether it is a valid exercise of congressional authority. The court determined it is broad enough to cover the dispute and it is within Congress’s authority so 1404(a) is applied
128
Gasperini v. Center for Humanities
-Facts: Gasperini was a journalist. He loaned some slides of photographs to the Center for Humanities, Inc. for an educational video. They lost the slides, and admit liability. He sued them in SDNY, and a jury awarded $1,500 per slide as an industry standard ($450,000 for all 300 slides). 2d Circuit determined, applying NY law, that the award "materially deviates from what is reasonable compensation." They ordered a new trial, unless Gasperini would accept $100,000
-Issue:
Trial court level - Can a federal trial judge disturb a jury award she regards as excessive? FRCP 59 - yes, if it shocks the consciousness. State -> if it deviates from what is reasonable.
Appellate level -> N.Y. Appellate Court standard -> deviate materially. Federal Appellate Standard -> abuse of discretion.
-Holding:
Trial court standard - Even though Rule 59 seems to apply, “shock the conscience” is a common law standard so conduct an Erie analysis. This results in forum shopping, so the state law should apply.
Appellate court standard - There is no applicable federal statute or rule, but 7th Amendment reexamination clause applies to appellate judges. There is a conflict between state and federal law and federal law is constitutional, so apply federal law.
129
What are the takeaways from Gasperini?
- Jury rights represent a special subset of cases where Byrd retains currency
- Where application of a state rule would be unconstitutional in federal court, the state rule must yield
130
Shady Grove
- Facts: Shady provided medical benefits to a patient that was in a car accident, she assigned her insurance benefits from Allstate to pay Shady. Allstate paid the bills but did not do so within the statutorily required time. Shady filed a diversity class action in federal court for similarly situated people to collect the statutory interest owed to them by Allstate. NY Civ. Prac. Law 901(b) precludes class action suits in federal court to recover a penalty despite FRCP 23 which permits class actions
- Issue: A state law that prevents certain types of damages from being pursued via class action may not limit federal class actions that satisfy the requirements of Federal Rule of Civil Procedure 23.
-Holding: Court is split
Majority: Scalia 5: the test of each did not say that, the NY statute says that they cannot maintain a class action for penalties so there is a conflict because you would not be able to file one at all- literal reading of the law puts the law in tension
Ginsburg 4: Rule 23 provides a base and NY can tweak it
Scalia 4: the federal rule does not modify a substantive right, and the rule is largely procedural. What matters is what the rule regulates: if it goevern only the manner and means by which the litigant’s rights are enforced- it is valid. If it alters the rules of decision by which the court will adjudicate those rights - it is not
Stevens: we need to look case by case to see if the rule modified something that is so intertwined we are modifying it, but in this case we are not modifying it because it would not enlarge NY law (trying to respect state rights if they are bound up in state law it is substantive and federal law would not apply)
131
Mason v. American Emery Wheel Works
- Facts: Mason was hurt by a wheel manufactured by AEWW. The place of harm was Mississippi and AEWW was a Rhode Island corporation, Mason brought suit in federal court in RI. The wheel was not bought by Mason but passed through other owners before him, AEWW filed a motion to dismiss based on Ford Motor a MS case that required privity to sue a manufacturer on a product liability claim. But another case, DuPont, in MS stated that did not overrule Ford but stated it was well understood that a person who has no privity may nevertheless recover
- Issue: How should courts handle controlling precedent that seems outdated based on newer developments in law?
- Holding: The federal court must apply the law they think the state supreme court would apply. Based on the age of the controlling precedent and more recent MS cases that suggest in dicta that national trends are changing, the court chooses to apply the modern rule.
132
What substantive law must federal courts apply when they are sitting in diversity?
State substantive law
133
What procedural law must federal courts apply when they are sitting in diversity?
Federal procedural law
134
How do you distinguish substance from procedure?
This process varies depending on the source of federal law (see Erie flowchart)
135
Does federal common law exist?
Yes, in areas like procedure and statute interpretation.
136
What is the purpose of appellate review?
- Correct honest error
- Counter trial court bias
- Facilitate reasoned deliberation
- Promote public confidence in the administration of justice
137
What are the problems with appellate review?
It's time-consuming, expensive, and inefficient
138
Bowles v. Russell
- Facts: Bowles misses a 30-day window to file an appeal, so he files a motion to reopen the period to file notice of appeal for another 14 days. District court granted motion and gave him 17 days to file the appeal. He relies on the judge’s order and files within that 17-day period but not within the 14-day window permitted by congressional statute.
- Issue: Did the court have the authority to extend the deadline from 14 to 17 days?
-Holding: Court-made rules are subject to court-made adjustments. When Congress sets a date, it’s jurisdictional and the court lacks authority to change it.
Overrules “unique circumstances doctrine”
Deadlines in acts of Congress are final and jurisdictional in a subject matter jurisdiction sense because if the deadline is missed, the appellate court no longer has jurisdiction over the case.
139
What are examples of literally final decisions?
12(b) dismissals, summary judgment, judgment as a matter of law, jury verdict, default judgment, dismissal with prejudice, judgment on pleadings
140
Bullard v. Blue Hills Bank
Bankruptcy claim, the court rejected Bullard’s proposed repayment plan and allowed him to submit a new plan. Bullard appealed. A party can only appeal a final judgment, the court said to review and resubmit which is not a final decision.
141
Moses Cone
Example of an "effectively final order"
Order suspending federal proceedings pending outcome in state court is “effectively final,” so it can be appealed because only the entering of judgment remains. All substantive work of the court is done.
142
Coopers & Lybrand
```
Example of an order that is not effectively final.
Ending a class action is practically final (in financial terms), but not appealable because the parties still have the legal right to proceed with the case.
```
143
Elements of collateral order doctrine
- Conclusiveness - Does the order represent a final determination of the question?
- Separability - Is the issue separate from the merits?
- Unreviewability - Does the order affect an important right that is effectively unreviewable later?
144
Cohen v. Beneficial (collateral order doctrine)
- Facts: P is shareholder who wants to file a shareholder action against managers & directors for breach of fiduciary duty. He doesn’t own enough shares to pass NJ’s threshold for paying defendants’ costs, which also requires bond payment to discourage frivolous appeals.
- Issue: Is the district court’s order refusing to require posting of a bond appealable?
-Why does the S. Ct. hear this case? Appealable collateral orders
Apply the elements of collateral order doctrine. It is effectively unreviewable because the defendant would lose their safety net (the bond requirement).
145
Mohawk Industries
-Facts: Mohawk is facing a class action for driving down wages by hiring undocumented workers. Carpenter, an employee, calls attention to these issues and is fired after refusing to recant his statements. He meets with Mohawk’s lawyers, and there are documents generated about that meeting. The issue is attorney-client privilege for those documents
-Applying collateral order test (first two met, third at issue) -
Conclusiveness: once documents are relinquished, they can’t be retracted
Separateness: Issue is about waiver of attorney-client privilege, which has nothing to do with core of case about undocumented workers or wrongful termination.
Effective unreviewability:
Mohawk says it is effectively unreviewable because the AC privilege is irreparably destroyed if appeal is delayed until final order (court does not agree with this)
Court says there are other ways to deal with the issue on appeal:
Disclose, seek review on appeal, get reversal, then get new trial OR
Refuse to disclose and take sanctions, which is reviewable earlier than after final decision.
146
Why is the collateral order doctrine so narrow?
Court keeps collateral order doctrine exception small so not every discovery order is immediately appealable (that would burden the CoA and delay trials at district court level).
147
Carson v. American Brands
- Facts: Carson sued American Brands for racial employment discrimination. The parties negotiated a settlement which included an injunction enjoining them from discrimination and forced them to restructure their policies. The district court denied the approval of the settlement because it violated Title VII. The plaintiffs appealed and it was dismissed for lack of jurisdiction.
- Issue: Is interlocutory order an appealable order
- Holding: An interlocutory order of the district court denying a joint motion of the parties to enter into a consent decree containing injunctive relief is an appealable order. If the plaintiffs are not able to appeal, it is possible and likely that they will lose the opportunity to settle their case.
148
Nystrom v. TREX
-Issue: Patent infringement case with counterclaims pending.
-Held: Parties may not appeal judgment that do not dispose of a pending counterclaim. The order is not final because of the pending counterclaim.
Different from Moses Cone because the parties were still planning on litigating those pending claims following appeal.
149
What were the options in Nystrom v. TREX to get an appealable order?
- Dispose of counterclaim through litigation to get final order
- Dismiss counterclaim without prejudice (manufactured finality)
- 54(b) partial summary judgment
- 1292(b) interlocutory appeal of controlling questions
150
Will v. United States
- Facts: Horwitz, a criminal defendant, got a discovery order from the trial court judge for sources of statements. Government objects to discovery order, saying it effectively requires them to turn over witness list. Government seeks writ of mandamus to order Will, the trial court judge, to vacate his order.
- When is writ of mandamus appropriate? Only under exceptional circumstances–when there is a “judicial usurpation of power.”
-Why was that standard not met?
No showing of usurpation of power in the record
Judge was not affirmatively/blatantly disregarding rules
Court of Appeals didn’t issue an opinion explaining the decision.
151
What is merger and bar?
Related to claim and issue preclusion. When you have tried a matter, all matters related to that claim that could have been litigated merge and are barred from later litigation.
152
What is res judicata?
Also known as claim preclusion. Bars relitigation of the same claim or cause of action.
153
What is collateral estoppel?
Also known as issue preclusion. Bars relitigation of the same issue.
154
What are the requirements of claim preclusion?
1. There must be a final judgment
2. Judgment must be on the merits
3. Claims must be the same in the two suits
4. Parties must be the same or in privity
155
Manego v. Orleans Board of Trade
- Facts: Manego wants to put a disco in a vacant lot near a skating rink, which is owned by a bank. He's denied licenses and the VP of the bank is involved with some of these other organizations that need to approve his actions. He first attempts a discrimination suit, and then brings a second suit based on antitrust.
- Issue: Does claim preclusion prevent Manego from bringing the second suit?
- Holding: Yes, the claim is barred because issues in the second claim arose out of the same "transaction" as the first claim. The same circumstances gave rise to both suits and Manego should have done more thorough discovery in the first suit.
156
Whole Woman's Health
- Issue: Does claim preclusion prevent a new suit premised on the development of new material facts?
- Holding: Constitutional challenges to different provisions in the same statute are separate transactions.
157
What FRCP operates as a claim preclusion rule for defendants?
Rule 13a - compulsory counterclaim
158
What are the requirements of issue preclusion?
1. Final Judgment
2. Issue is the same in two suits
3. Issue must have been actually litigated, determined and necessary to judgment in first suit.
4. Circumstances of second suit do not indicate that it would be unfair to invoke the doctrine.
159
In Hardy v. Johns-Manville, what did the court have to say about ambiguities?
Because of ambiguities in the jury verdict, issue preclusion did not apply to the defendants. You don't want to bind people in a new suit without fully litigating the issue in the first place.
160
What are the exceptions to nonparty preclusion from Taylor v. Sturgell?
1. Nonparty agrees to be bound
2. Legal relationships bind non-parties
3. Adequate prior representation of non-parties
4. Non-party assumed control of prior case
5. Relitigation by proxy
6. Statutory schemes (e.g. bankruptcy)
161
In Taylor v. Sturgell, did the Court adopt the theory of virtual representation?
No, the Court did not accept the FAA's theory of virtual representation. The default is that a non-party is not bound by prior representation.
162
What is mutuality of estoppel?
Parties must be the same in order to be estopped
163
Where do we still require mutuality of estoppel?
Claim preclusion, but not issue preclusion
164
What is an example of defensive estoppel?
When an auto dealer defends by raising issue preclusion the plaintiff had already litigated and lost the issue
165
What is an example of offensive estoppel?
When P wins the issue in court, another P wants to establish liability because the defendant has already litigated and lost the issue.
166
How does the court proceed regarding offensive estoppel in Parklane Hosiery Co.?
Allows use of collateral estoppel because there is no unfairness involved in applying the ruling to another case after the issue was already litigated and lost with the SEC.
167
What problems arise with offensive estoppel?
- May not produce judicial economy because it encourages a "wait and see" approach rather than joining all parties in a single action
- Can be unfair to defendants if the circumstances of the two suits differ
168
What are the requirements for an interlocutory order?
1292(b): District Court issues interlocutory order and believes it involves...
- a controlling question of law
- substantial grounds for difference of opinion
- immediate appeal from the order might materially advance the ultimate termination of the litigation.
169
Must the Court of Appeals accept appeal via interlocutory order?
The Court of Appeals has discretion to permit this appeal.
170
How does partial summary judgment work?
Rule 54(b): District Court must
- expressly direct entry of judgment to some but not all claims AND
- expressly determine there is no just reason for delay of an appeal.
171
What are the avenues of appeal?
1291 final decisions, 1292(a)(1) interlocutory orders concerning injunctions, 54(b) partial summary judgment, 1292(b) interlocutory appeal of controlling questions, writ of mandamus.
172
What type of injunction is most likely to give rise to an interlocutory appeal?
Preliminary injunction (TROs are excluded from 1292(a)(1) and permanent injunctions are typically 1291 final orders)
173
When is 1292(a)(1) appeal of interlocutory orders available?
Only if a litigant can show that an interlocutory order of the district court might have a "serious, perhaps irreparable consequence" and that the order can be effectively challenged only by immediate appeal.
