Civil Proceedure 2225358

Civil Procedure I Outline Fall 07
Subject Matter Jurisdiction the federal court must have SMJ to exercise power over a particular case/action. SMJ can be brought up at any time during proceedings. Judge has a duty to seek SMJ regardless of whether the parties have brought it up. o US Const Art III Secs. 1, 2 Section 1. Establishes Judicial branch (Supreme Court + lower courts) Section 2. Specifies the subject-matter jurisdiction of the federal courts and requires trial by jury in all criminal cases, except impeachment cases US Const Art IV Sec 1
Section 1. Provides for the responsibilities states have to each other, and the responsibilities the federal government has to the states (full faith and credit given to the states) US Const Art VI The Supremacy Clause - establishes the Constitution, Federal Statutes, and U.S. treaties as "the supreme law of the land." The Constitution is the highest form of law in the American legal system. State judges are required to uphold it, even if state laws or constitutions conflict with it.
I.
Federal Question Jurisdiction a. Title 28 U.S.C. 1331: The district courts shall have original jurisdiction of all civil actions arising under the Constitution, law or treaties of the United States i. Arising under a case arises under federal law if the plaintiff is alleging a right or interest that is substantially founded on federal law, which consists of federal common law, federal constitutional law, federal statutory law, treaty law, and federal administrative regulations. ii. Federal Question must appear in the complaint must appear as part of plaintiffs cause of action, as set out in a well-pleaded complaint. (FRCP 8a) 1. A suit arises under the Constitution and laws of the United States only if the original statement of the plaintiffs cause of action shows that it is based on the Constitution or federal statutes. A complaint does not raise a federal question if it does so only in anticipation of some defense. Likewise, the court may not look to a counterclaim asserted by the defendant to determine whether the plaintiffs complaint states a federal question claim. a. Louisville & Nashville Railroad v. Mottley (1908) - Mottleys recd lifetime passes for RR use in a settlement with named RR co. Later, Congress made it illegal to issue free passes, and RR refused to honor Mottleys free passes. Fed court lacked SMJ b/c Mottleys original complaint failed to state a cause of action in terms of federal question. The federal law did not give rise to the plaintiffs claim, although it was the cause of the plaintiffs troubles. The federal question issue only arose as a matter of anticipated defense by RR company, b/c RR company was just following federal rule in refusing to honor Mottleys pass. b. Some actions are under the exclusive jurisdiction of federal courts (under other specific statutes). 28 U.S.C. 1333-1365. c. In order to have a good Federal question claim, you will need to show (1) the conduct of which you are complaining is substantively wrong under federal law, and (2) the federal courts have the jurisdictional authority to redress the wrong. Diversity of Citizenship Jurisdiction 28 U.S.C. 1332 Complete diversity, & amount in controversy exceeds $75k. The federal courts have been given SMJ over controversies between
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citizens of different states, even thought the controversies do not involve questions of federal substantive law, in order to protect an out-of-state party from possible local bias in state courts. a. Amount in Controversy (>$75k) i. Exclusive of interest and costs; Determined only by what is claimed in the complaint, & doesnt include defenses or counterclaims ii. Doesnt matter if ultimate judgment is less than $75k all that is necessary is that there is a good faith allegation that the amount in controversy is more than $75k. 1. Good faith means that there is a legal possibility to get this recovery. Complaint can be dismissed only if theres no legal possibility to recover more than $75k. iii. Amount In Controversy 1. Collateral effects of a judgment may not be considered in this amount a. Ex. If disability installments due, only the amount currently due can be claimed. Future installments cannot. 2. Exclusive of Interests and Costs a. Attorneys fees that are recoverable by contract or statute can be considered. Otherwise it cannot. b. Interest that is part of the claim is considered, as opposed to interest accrued by delay in payment (which is not). 3. Equitable relief (ex. Specific performance, injunction, etc.) since plaintiff doesnt seek money damages, it may be hard to calculate the amount in controversy. a. Courts may look from plaintiffs viewpoint what is the value of harm caused by defendant? b. Or, Courts may look from defendants viewpoint what would be cost to defendant if equitable relief were ordered? c. Or, some courts say amount in controversy satisfied if, under either of the 2 above tests, the amount exceeds $75k 4. Punitive Damages if it is permitted under state substantive law, then ok to consider because there is no legal certainty amount cannot be recovered. iv. Aggregation of separate claims 1. 1 P v. 1 D Where a single plaintiff has multiple unrelated claims against a single defendant, that plaintiff can aggregate those claims (add the amounts together), to satisfy the amount in controversy requirement. 2. 1 P v. 2+ D - In cases involving more than one defendant, a plaintiff may aggregate the amount claimed against multiple defendants only if the defendants are jointly liable (any of the defendants can be held liable for the full amount of the claim). However, if the defendants are severally liable (where the parties are liable for only their respective obligations), plaintiff must satisfy the amount in controversy requirement against each individual defendant. 3. 2+ P v. 1 D Several plaintiffs can aggregate their claims against a defendant only where they are seeking to enforce a single title or right in which they have a common or undivided interest (like in class actions) b. Complete Diversity - Every plaintiff must be of diverse citizenship from every defendant. If one defendant and one plaintiff are citizens of the same state, there is no diversity jurisdiction (includes state citizen v. alien or foreign state, but not between 2 foreign entities, a U.S. state citizen must be involved). i. Mas v Perry (1974) Plaintiffs in LA to go to school (P1 from Miss., P2 from France). Action brought in Federal Court against LA domicile. Issue was whether there was a diversity of citizenship to have SMJ.
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1. If any plaintiff shares a common citizenship with any defendant, then diversity is destroyed and along with it federal jurisdiction. 2. Citizenship of an Individual is their domicile; mere residence in that State is not sufficient a. A persons domicile is the place of true, fixed, and permanent home and principal establishment, and to which he has the intention of returning whenever he is absent therefrom. A change in domicile may be effect by a) taking up residence in a different domicile and b) with the intention to remain there. b. A woman does not have her domicile or State citizenship changed solely by reason of her marriage to an alien. ii. Citizenship of a corporation 1. Any and every state of incorporation, and 2. State in which it has its principle place of business a. Principle place of business is a fact question b. Courts have generally held that: i. If corporation has its executive officers in one state and its physical operation wholly pr predominantly in another state, the principle place of business is the state where physical operations are conducted. ii. If corporation performs its operational activities in many states, then the nerve center test applied, and the principle place of business is where the executive officers are located. c. Note: if incorporated in foreign state, then alien for diversity purposes. If principle place of business in U.S., then citizenship is of that state. d. Note: if opposing party is of same citizenship of any of the corporations citizenships, then no diversity. iii. Citizenship of unincorporated Associations 1. Citizenship is that of each and every one of its members. The association may sue or be sued in their own name if local law permits. If not, and state follows the common law rule, then it is an aggregate of individuals 2. Class Action the relevant citizenship is that of the named members who sue or are sued on behalf of members of an association 3. Partnerships citizenship is that of each and every partner c. 1359 Federal court does not have jurisdiction if any party, by assignment or otherwise, has been improperly or collusively made or joined to invoke the jurisdiction of such court. i. If a claim is assigned to another party, court would ignore citizenship of assignee to determine diversity jurisdiction (someone may do so just for purposes of getting SMJ). However, if the assignor retains no interest in the claim, then citizenship of assignee ok to consider for SMJ. ii. For class actions, ok to select named members for purposes of diversity. iii. Voluntary change in state citizenship - To be considered for diversity, the change must have been made before the suit is brought (although ok if changed after the cause of action). Change must be genuine, but motive is irrelevant. iv. Ok to manipulate the choice of a rep, or assignment of a claim to defeat diversity (and so also removal). However, fraudulent joinder of an in-state defendant is no bar to removal. d. Class Action complete diversity & more than $5 million e. Subsequent Addition of Parties must still satisfy SMJ or if not, invoke supplemental jurisdiction i. Rule 24(a) Intervention of Right - A potential party has the right to intervene in a case either (1) when a federal statute explicitly confers upon the applicant an
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unconditional right to intervene, or (2) when the applicant claims an interest relating to the property or transaction which is the subject of the lawsuit (and only by getting involved can they protect it). ii. Rule 24 (b) Permissive Intervention may be permitted in the courts discretion where the intervenors action and the main action have a claim or defense involving a common question of law or fact. Requires independent SMJ, or if none, Suppl. Jurisdiction (which is unlikely). iii. Rule 25 Substitution Changes in parties to a lawsuit ok if necessary due to death, incompetency, etc., after action has commenced. Citizenship is still of the original party. 1. Ex. If A sues B, and A dies, then C, administrator of As estate, is substituted. Citizenship considered is that of A, not C. 2. As opposed to replacement, which happens if A sues B, then finds out that C, not B, is the right defendant. So C replaces B, and citizenship considered is of C iv. Rule 14 Impleader - one party joins a third party into a lawsuit because that third party is liable to an original defendant. 1. Example: A (NY) sues B (CA). B impleads C (NY) because C is liable to B. A and C have same citizenship, but doesnt matter because the impleader is between B and C. However, if A impleads C, no diversity, and cannot use supplemental jurisdiction (but maybe ancillary). If a federal question, then theres SMJ. f. Cross-Claims (Rule 13) allows a party to assert a claim against a co-party, but only if the claim arises from the same transaction or occurrence as the underlying dispute. Must still invoke SMJ (or if not ancillary jurisdiction) g. Counterclaims (Rule 13) i. Defendants counterclaim cannot be combined with plaintiffs claim to reach amount in controversy requirement (for plaintiffs original claim). ii. A compulsory counterclaim (arising from the same transaction or occurrence as the original claim) does not need to meet amt in controversy requirement (this is ancillary jurisdiction, and also like impleader) iii. A Permissive counterclaim (arising from a unrelated transaction) must meet the amount in controversy independently iv. No removal to federal court based on counterclaim (where plaintiffs claim does not meet amount in controversy requirement, but defendants counterclaim does.) 1. A plaintiff cannot remove because removal is reserved for defendant 2. But, traditionally, a defendant cannot remove either. So, a plaintiff with a small claim can require a defendant with a large claim to litigate in state court by being the first to file. However, there is a recent trend allowing removal. h. Exceptions no matter if SMJ is satisfied, federal courts will not hear the following: i. Domestic Relations divorce, alimony, child support ii. Probate Proceedings the claim must involve actual probate (legal process of settling the estate of a deceased person) or annulment of a will or seek to reach property in the custody of a state probate court
III.
Supplemental Jurisdiction a. 28 U.S.C. 1367 i. The authority of United States federal courts to hear additional claims substantially related to the original claim even though the court would lack the subject-matter jurisdiction to hear the additional claims independently.
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ii. The claim to be joined must arise from a common nucleus of operative fact as the claim that invoked SMJ. This means the claims must arise from the same transaction or occurrence. iii. This encourages efficiency by only having one trial at the federal level rather than one trial in federal court and another in state court. iv. However, if the case is brought as a diversity action (i.e., each defendant comes from a state different than each plaintiff), there generally is no supplemental jurisdiction if such claims would destroy complete diversity. b. Ancillary jurisdiction i. Applies when the parties are in federal court because of diversity (i.e., each defendant is from a state different than each plaintiff) and one party wants to bring a claim against another party (possibly a third-party) which would otherwise defeat that diversity. ii. Ancillary jurisdiction allows the federal court to continue hearing the case despite this lack of diversity because bringing in the 3rd party (the party that would destroy diversity) is sufficiently related to and necessary for the fair conclusion of the claim iii. Restraints of ancillary jurisdiction 1. The additional non-federal claim must be sufficiently related to the original claim ("ancillary and dependent" rather than "new and independent"). Compulsory claims, claims which must be heard in the present case or they will be lost, are especially likely to be heard. 2. A court is far more likely to grant ancillary jurisdiction to a claim asserted by the defendant rather than the plaintiff because the plaintiff chose the court in which to bring their case whereas the defendant was forced into the plaintiff's choice. This preference for defendants helps prevent a plaintiff from getting into federal court through suing one diverse defendant and simply impleading in the necessary non-diverse parties. c. Pendent jurisdiction - is the authority of federal court to hear a closely related state law claim against a party already facing a federal claim (based on federal ques OR diversity), or "jurisdiction over nonfederal claims between parties litigating other matters properly before the court." Such jurisdiction is granted to encourage both "economy in litigation," and fairness by eliminating the need for a separate federal and state trial hearing essentially the same facts yet potentially reaching opposite conclusions. However, in diversity complete diversity must be kept, only applies if additional claim does not meet amount in controversy. i. United Mine Workers of America v. Gibbs, 383 U.S. 715 (1966) - Gibbs was a manager who got in trouble with a union and was shut out of work. He sued the union on two claims: one state (tort) and one federal (labor statute). The issue was whether it was proper for federal court to exercise jurisdiction over the state claim. Court decides yes. Gibbs has been read to require that (1) there must be a federal claim (whether from the Constitution, federal statute, or treaty) and (2) the nonfederal claim arises "from a common nucleus of operative fact" such that a plaintiff "would ordinarily be expected to try them in one judicial proceeding." ii. Ex.: P (NY) asserts 2 claims on D (also NY), in fed court. Both claims arise from the same transaction. Claim #1 invokes federal question jurisdiction, but Claim #2 is based on state law and doesnt. No diversity here to bring Claim #2 to fed court. However, pendent jurisdiction would allow Claim #2 to be brought in with Claim #1 in fed court. d. Pendent party jurisdiction - the court's authority to adjudicate claims against a party not otherwise under the court's jurisdiction because the claim arises from the same nucleus of facts as another claim properly before the court. i. Where plaintiff sues more than 1 defendant if there is federal jurisdiction over the claim against one defendant, then the claim against 2nd defendant which does not invoke SMJ may invoke suppl. Jurisdiction under pendent party jurisdiction if the
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claim arises from the same nucleus of common facts as the claim which did have SMJ. ii. If multiple plaintiffs asserting claim against 1 defendant P1s claim against D invokes SMJ, but P2s claim does not (no diversity or federal question). However, Suppl. Pendent party jurisdiction can be invoked if arising from a common transaction with claim that did have SMJ. 1. Exxon Mobile Corp v Allapattah Services, Inc. - dealers of a fuel company (1) filed a class action, and invoked the District Court's diversity jurisdiction. The issue was whether the court had properly exercised supplemental jurisdiction over the claims of class members who did not meet the jurisdictional amount. Yes. The Supreme Court found that, where the other elements of jurisdiction were satisfied and at least one named plaintiff met the amount-in-controversy requirement, 1367 authorized supplemental jurisdiction over claims of other plaintiffs in the same U.S. Const. art. III case or controversy, even if those claims were for less than the jurisdictional amount. By enacting 28 U.S.C.S. 1367, Congress overruled prior Supreme Court precedent that had required every plaintiff to separately satisfy the amount-in-controversy requirement.
IV.
Venue (The exercise of discretion by the courts) Venue determines what county or judicial district a case may be brought in. The purpose of venue rules is to limit the plaintiff's choice of forum in order to insure that the locality of the lawsuit has some logical relationship to the litigants or the subject matter of the dispute. Venue, unlike subject matter jurisdiction, may be waived. Stated another way, the distinction is this: jurisdiction is the power to adjudicate, venue relates to the place where judicial authority may be exercised and is intended for the convenience of the litigants. a. 1391 Venue Generally - Summarized: i. Venue is proper in a judicial district: 1. where any defendant resides, if all defendants reside in the same state. 2. in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of the property in dispute is located 3. if there is no district in which the action may otherwise be brought a. if federal jurisdiction based on diversity only, i. in which any defendant is subject to personal jurisdiction at the time the action is commenced b. if federal jurisdiction is not based solely on diversity i. any district in which any defendant may be found, if there is no district in which the action may otherwise be brought c. Where defendant is the U.S., or agency of, acting in official capacity i. Where the plaintiff resides if no real property is involved in the action ii. For purposes of venue, a defendant that is a corporation is deemed to reside in any district in which it is subject to personal jurisdiction. iii. For purposes of venue, an unincorporated association resides where it does business iv. An alien may be sued in any district. v. Improper venue may be waived (SMJ cannot). Venue is considered to be waived unless timely objection is made to the proper venue.
b. Transfer or Change of Venue & Forum Non Conveniens - This doctrine permits a court
having jurisdiction over an action to refuse to exercise its jurisdiction when the litigation could be brought more appropriately in another forum.
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i. Where original venue is improper - 1406(a) provides that if a civil action is

commenced in the wrong district or division, the court shall dismiss, but if it is in the interest of justice, the court may instead transfer the case to any district or division in which it could have been brought. Transfer is preferable to dismissal since it avoids the necessity of commencing a new lawsuit. Transfer can be ordered only if the court in which the action was brought has jurisdiction of the subject matter but it is not necessary that it have personal jurisdiction. 1. Applicable Law the originally applicable laws carry over to the transferred-to venue (Under Erie). ii. Where the original venue is proper - 1404(a) states: allows transfer to another district where the action might have been brought for convenience, but new venue still needs SMJ, PJ, and new venue must also be proper. 1. Under the rule of "forum non conveniens" a court can dismiss a suit even though it has both personal and subject matter jurisdiction and the venue is properly laid if there exists another forum so much more convenient for the parties and the courts that plaintiff's privilege of choosing his forum was outweighed. a. Gulf Oil Corp v Gilbert Gilbert sues Gulf Oil on a tort claim. Gilbert brought an action in NY on diversity grounds (b/c more favorable). There was proper venue in NY, but Gulf Oil could also be served w/ process in VA, and the accident happened in VA, many of the witnesses were in VA, and Gulf Oil is in VA. The court issued a forum non conveniens dismissal, and Supreme Court upheld it. i. Unless the balance is strongly in favor of the defendant, the plaintiffs choice of forum should rarely be disturbed. ii. One reason to change the forum is if the burden and oppressiveness to the defendant is out of proportion to the convenience of the plaintiff. iii. The court must consider and balance certain public interest factors and private interest factors. b. Piper Aircraft v Reyno (1981) A small plane crash in Scotland. Scottish relatives sued the American manufacturers (PA). Plaintiff filed in PA b/c ore favorable for plaintiff. Defendant removed the case to Federal Court, transferred to PA, and was granted a forum non conveniens dismissal. The issue was whether trial court had a right to issue the forum non conveniens dismissal. Court follows Gulf Oil, and decides the best forum is in Scotland. i. Forum non conveniens cannot be inflexibly defeated merely on the basis that the alternative forum would have laws less favorable to the plaintiff. ii. The interests of foreign plaintiffs should be weighted less heavily than the interests of domestic defendants (more convenient and favorable for defendants to litigate in Scotland). iii. Court acknowledges that Scotland has many contacts with the litigation and that it would be best if it moved there 2. Applicable Law is the applicable law of the transferred-to venue (the proper venue) iii. Procedure for Transfer 1404(a) Motion for transfer may be made by any party, including the plaintiff. Motion may be made at any time though delay in moving is a factor that will be considered in passing on the motion. Once the motion is
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granted the transferor court loses all jurisdiction over the case. If the transfer is on motion of the defendant, the transferee court must apply the law that would have been applied in the transferor court; a change in forum means only a change of courtrooms but not a change of law. This means that in passing on the motion to transfer the court must consider the effect that retaining the law of the transferor state will have. (E.g., if law is unclear in transferor state that would influence against transfer.)
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Removal Jurisdiction - allows the defendant in state court to have the case transferred to the federal court. This is not an appeal. a. Removal governed by 3 statutes: 1441, 1446,1447 i. You can remove from state to district court if there was original federal SMJ (to the district court where the action is pending) ii. Only Defendants can remove, plaintiffs can NEVER remove iii. All defendants must agree - rule of unanimity iv. You can remove only to the federal district that embraces the state court v. You must remove within 30 days of the service of the document that first made the case removable. Diversity cases are removable only if none of the defendants is a citizen of the state in which the action is brought (doesnt matter if SMJ based on federal question) b. 28 U.S.C. 1441-1452 *See additional info. i. Details removable/non-removable actions and the procedures of removal.
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Personal Jurisdiction (PJ) refers to the ability of a court to exercise jurisdiction over a particular defendant or item of property. The existence of personal jurisdiction depends upon a sufficient connection between the defendant and the forum state to make it fair to require defense of the action in the forum and the giving of reasonable notice to the defendant that an action has been brought. An exercise of personal jurisdiction must not exceed the limitations of either state statutes & U.S. Constitution. s I. Statutory Limitations on In Personam Jurisdiction states have power to decide over whom their courts may exercise jurisdiction. So, first look at state statute to see if personal jurisdiction ok. If yes, then ask the question Is this constitutional? A. Bases of In Personam Jurisdiction: i. Traditional Bases for Personal Jurisdiction 1. Pennoyer v Neff (1877) [modified by international shoe) Mitchell (Oregon domicile) was an attorney for Neff (nonresident of Oregon). Neff failed to pay fees to Mitchell, and Mitchell sued him. Neff was served notice through a newspaper in Oregon. He never showed up in Oregon court to answer, and Judgment was entered upon his default. Neff then bought land in Oregon, and Mitchell had a sheriff seize the property. Sheriff sold the property to Pennoyer, and the sheriff paid Mitchell amount owed from the lawsuit. Neff reappeared in Oregon and when he found his property was seized, filed suit against Pennoyer to get his property back. The issue was whether Oregon had personal jurisdiction over Neff in the original lawsuit by Mitchell. Court found that the courts original verdict was invalid because Oregon didnt have in personam jurisdiction over Neff, and so it was wrongly seized and sold to Pennoyer. Pennoyer v Neff established that: a. To have in personam jurisdiction, there must be personal service or process or defendant can make a voluntary appearance. (Presence, Consent) b. A state has exclusive jurisdiction over people and property within its borders, and cannot exercise jurisdiction over people in other states (Domicile) c. The Full Faith and Credit clause of the Constitution only applies when the court rendering the judgment had jurisdiction of the parties and of the subject-matter. ii. Physical Presence at Time of Personal Service - where the defendant is present in the forum state and is personally served with process in the forum state, no matter how long he was present (i.e., even if just passing through). 1. Supreme Court has upheld this type of jurisdiction, allowing a transient defendant to be served with process for a cause of action unrelated to his brief presence in the state a. Burnham v. Superior Court (1990) NJ petitioner under CA jurisdiction because he was served on a divorce action while in CA on unrelated matters. If defendant is voluntarily in a state, and is personally served in that state (so due process satisfied), then the state has jurisdiction. Cant claim you were unfairly dragged into state, b/c you should know that by going into the state you are putting yourself at risk of being under the state's jurisdiction if served. You are under protection of state laws while there. Easier and fairer, due to advanced technology in travel. Also, evidenced that it would not be burdensome for defendant to travel to forum state, since he had done it once before. No unfairness because he is already in the state. 2. Exceptions: Even though personal service in forum state requirement met, there are limitations.
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a. If P brings D into forum state by fraud or force to serve process, most courts will find the service invalid. b. Immunity of personal jurisdiction to nonresidents of a forum state whose only purpose of being the state is due to judicial proceedings in that state or elsewhere iii. Domicile - Where the defendant is domiciled in the forum state, even if defendant is not physically within the state when served with process 1. Citizenship A U.S. citizen, even if domiciled abroad, is subject to PJ in the U.S. iv. Consent - Where the defendant consents to jurisdiction, whether express or implied, or through the making of a general appearance 1. Express consent express consent whether given before or after suit commenced, is a sufficient basis for PJ a. A person can, by contract, give advance consent to jurisdiction in the event a suit is brought against him. i. Carnival Cruise lines v Shute Shutes took cruise, and on back of ticket, there was a forum selection clause for Florida jurisdiction for any disputes arising. Issue is whether the forum selection clause is enforceable. It is a form contract, nonnegotiated. Court says it is permissible because not made in bad faith (i.e. to discourage potential plaintiff from filling a suit), and it is fair since Carnival primarily does business in FL. Court says clause benefits because otherwise potentially suits from all over, eliminates uncertainty, avoids costly pre-trial motions, and lowers cost of fare because litigation costs are lower. Dissent says there is unfairness in the unequal bargaining power. b. A person, by contract, can appoint an agent in a particular state to accept service of process in that state. Terms of the contract determine extent of agents power and scope of jurisdiction i. Sometimes states require a business (which the state heavily regulates) to appoint an agent. 2. Implied Consent when the state has substantial reason to regulate the instate activity of a nonresident of the state, it may provide that by engaging in such activity, the nonresident thereby appoints a designated state official as his agent for service of process a. Hard to get personam jurisdiction through the traditional bases from Pennoyer. As society becomes more mobile, def can more easily leave jurisdiction. So, Court has expanded the traditional bases because of this problem i. Hess v. Palowski (1927) - Court allows to expand consent to include implied consent. A state can legislate that a nonresident motorist using its highways be deemed to have appointed a local official as his agent to receive service of process in any action growing out of the use of the vehicle within the state 3. Voluntary Appearance i.e., by contesting the case without challenging personal jurisdiction, becomes subject to PJ a. By making an "appearance" in response to a lawsuit a defendant is in effect submitting to the jurisdiction of the court and waiving any defects, if any, in personal jurisdiction. In most states a defendant who wishes to challenge jurisdiction may do so by making a special appearance which is limited to the issue of jurisdiction. If he or she
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raises any other issues or claims he has made a general appearance and waives any defects in jurisdiction. b. In federal courts no special appearance is necessary. Jurisdiction may be challenged in a motion or included as a defense in the answer. v. Long Arm Statutes - Where the defendant has committed acts bringing him within the forum states long-arm statutes, there is PJ, service can be within or outside forum state, but limited to acts performed within the state 1. Unlimited Long Arm Statutes a few states (CA) have this; it gives their courts power over any person or property over which the state can exercise jurisdiction. 2. Limited (or Specific) Long Arm Statutes most states have this; specify in detail situations in which their courts can exercise jurisdiction Constitutional Limitations once determined that a state statute allows PJ, we must then ask if it is constitutional. The due process clause. A. General Jurisdiction when defendant engages in systematic and continuous activity within the forum state, PJ for any cause of action (however, casual occasional or indirect activities within the state do not give general jurisdiction i. Helicopteros Nacionales de Colombia v. Hall (1984) - recognizes a distinction between "general" and "specific" jurisdiction. In order to assert general jurisdiction there must be substantial forum related activity on the part of the defendant. The threshold for satisfying minimum contacts is higher than in specific jurisdiction cases B. Specific Jurisdiction - the claim asserted arises out of defendants contact with the forum (with the specific in-state activity). There is an isolated transaction/business. You put yourself in that area, you have such contacts that it is fair to be held in that state (you have voluntary action to go into the area), as long as lawsuit arises directly out of it. Depends on the quality & nature of transaction to apply specific jurisdiction. ***Must be minimum contact; related-to; it shouldnt violate fair play & justice. C. Sufficient Contacts with the Forum i. Traditionally, jurisdiction over a person (or res) was based on the states physical power to carry out its judgment. a. There is no personal jurisdiction over a defendant unless the defendant is served while physically within the forum state 2. Court later expanded states physical power to extend not only to those defendants who were served within the state (Pennoyer v Neff), but also those defendants who consented to the states power or who were domiciled in the state, regardless of where they were served. ii. Modern Due Process Standard (if traditional view cannot be met, we can come to the International Shoe test) the focus became whether sufficient minimum contacts exist between the defendant and the forum so that it does not offend traditional notions of fair play and substantial justice. There must be contact and fairness. 1. The due process clause does not permit a state to exercise personal jurisdiction over an individual or corporation with whom the state has no contacts, ties or relations. 2. Minimum Contacts - Having sufficient dealings or affiliations with the forum jurisdiction so that the exercise of jurisdiction would be fair and reasonable, and such that compelling him to appear and defend in the forum does not offend traditional notions of fair play and substantial justice. a. International Shoe Co. V. Washington (1945) International Shoe is a DE company based in Missouri. They have some salesmen working on commission in Washington but dont have any offices there. Washington state trying to get International Shoe to pay into an unemployment fund, and personally served one of the salesmen in Washington with the notice, as well as sending registered mail to their
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b.
3. There a.
b.
c.
home office in Missouri. The issue was whether Washington had jurisdiction over International Shoe. Court said yes, because there were sufficient contacts with the state (minimum contacts). International Shoe benefited by having business in Washington, and was protected by its laws while doing so. International Shoe held: i. To exercise personal jurisdiction, there must be: 1. Contact with the forum (minimum contacts) a. purposeful availment b. foreseeability 2. Fairness a. cannot offend traditional notions of fair play and justice. must be purposeful availment and Foreseeability. Purposeful Availment the contacts with the forum state cannot be accidental. Defendant must reach out to the forum in some way, such as to make money there or use the roads there. The court must find that through these contacts the defendant purposefully availed herself of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of its laws. Foreseeability in addition to purposeful availment, the contact requirement of International Shoe requires that it be foreseeable that the defendants activities make her amenable to suit in that forum. The defendant must know or reasonably anticipate that her activities in the forum render it foreseeable that she may be haled into court there Case Examples: i. McGee v International Life Insurance - McGee had a policy, signed contract (w/ Texas corp.) mailed to him in CA, mailed his premium payments from CA. Wife recovered when he died by filing suit in CA against insurance co. Issue was whether CA had jurisdiction over TX insurance company. Yes. No minimum contacts, but there is relatedness, where the plaintiffs claim arises out defendants contact with the forum. Also, Defendant reached out to CA to solicit business. Finally, it is in the states interest in making sure their citizens get justice. ii. Hanson v. Denckla (1958) Decedent established trust in DE, but later moved to and died in FL. Trust company had no dealings in FL, except to pay decedent in FL via mail. Issue is of whether FL had jurisdiction. Says no jurisdiction because insufficient minimum contacts. Court creates the concepts of purposeful contacts; must purposefully avail" themselves of activities and benefits in the forum state. iii. Burger King v. Rudzewicz (1985) Defendant opened BK franchise in MI; BK in FL, and Def were trained in FL. Issue is whether FL had jurisdiction. The Supreme Court concluded that the defendants purposefully availed themselves to the protections of the forum state (FL) and are, therefore, subject to jurisdiction there. The Court reasoned that the defendants had a "substantial and continuing" relationship with BK in Florida and that due process would not be violated because the defendants should have reasonably anticipated being summoned into court in Florida for breach of contract.
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Therefore, minimum contacts is established. Burden on defendant to show unfairness, and they could not. iv. Kulko v. Superior Court (1978) sending child to CA doesnt subject father to CA jurisdiction. It didnt constitute minimum contacts. Also, unfair and unreasonable. v. Stream of Commerce 1. World-Wide Volkswagen Corp. v. Woodson (1980)- Car purchased in NY, accident in OK. Plaintiffs brought suit in OK, but were still domiciles of NY. Distributor had no business dealings in OK; did not solicit business there, no purposeful availment. Only contact was this accident, but car bought in NY, so no relevant contacts. Court says foreseeability IS relevant - test is not whether the product would get to OK. Rather, it must be foreseeable that the defendant would get sued in that forum, OK. Court says OK has no jurisdiction over the local distributor. However, the joint party, a national distributor would be under any jurisdiction, b/c they have business dealings nationally. 2. Asahi Metal Industry Co. v. Superior Court - Asahi (Japan) sold parts to manufacturer in Asia who put them in stuff sold in CA. No purposeful availment by Asahi of CA market, therefore no jurisdiction even if it was foreseeable that Asahis products would end up there. Interpretation of stream-of-commerce theory played a part in opinion, also consideration of fair play and substantial justice, said it was a severe burden for Asahi, an alien corporation, to have to defend itself in CA. Also, interpreted minimum contacts test as also requiring fair play and substantial justice). vi. Pavlovich v. Superior Court 1. Pavlovich worked on defeating DVD copy protection and put up a web page with information about the DeCSS program. DVD CCA brought suit against Pavlovich in California alleging that the defendant had misappropriated its trade secrets. The defendant moved to quash service based on a lack of personal jurisdiction in California. Def says yes, there is PJ, b/c his actions hurt the movie industry, largely based in CA, so Pavlovich should have known that (foreseeability). Internet webpage is available anywhere, and in CA. The issue was whether California had specific jurisdiction over Pavlovich based on the web page he posted? Court says no. Pavlovichs intention in having info on webpage was for programming development, not to broadcast how to defeat the copyright. Therefore, no personal availment, no foreseeability, and thus no minimum contacts. d. Fairness cannot offend traditional notions of fair play and justice. It is possible that a strong showing of fairness might make up for lesser amount of contact, but minimum contact always necessary. Several factors relevant to determine whether jurisdiction would be fair:
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i. Relatedness of claim to contact- must arise out of the

transaction in the forum to have specific jurisdiction ii. Convenience forum doesnt have to be the best available, so long as it is not so gravely difficult and inconvenient that a party is unfairly put at a severe disadvantage in comparison with his opponent. 1. World-Wide Volkswagen Corp. v. Woodson (1980) not fair for local NY retailer to be dragged to OK. National retailer suffers no inconvenience b/c they have insurance company to deal with this. 2. This is a hard standard to meet and defendant will probably not be able to meet it simply by showing that the plaintiff has superior economic resources. a. Burger King v. Rudzewicz iii. Forum States Interest forum may have a legitimate reason for providing redress for its residents 1. McGee v International Life Insurance Insurer (TX), insured resident of CA. Issue was whether CA had jurisdiction over TX insurance company. Yes. Court referred to CAs interest in providing its citizens with means of redress. 2. World-Wide Volkswagen Corp. v. Woodson (1980) OK cares about safety in their state. iv. Other Factors 1. Plaintiffs interest in obtaining convenient and effective relief 2. The interstate judicial systems interest in obtaining the most efficient resolution of controversies 3. The shared interest of the states in furthering fundamental substantive social policies
D. Notice in addition to minimum contacts and fairness, due process requires that a
reasonable method be used to notify the defendant of a pending lawsuit so that she may have an opportunity to appear and be heard (traditionally called service of process). i. Due process must be reasonably calculated, under all circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections. ii. Federal Rule 4 1. Process consists of the summons and a copy of the complaint a. Summons very important - symbol of govt power over defendant. Rule 4(a)(1) b. Service can be made by any non-party who is at least age 18. Rule 4(c)(2) 2. This is important because defendant must be given an opportunity to be heard Rule 4(c) a. Factors to protect defendant i. Plaintiff must give an affidavit - under penalty of perjury, a statement why they have to get property back ii. Affidavit must state specific facts iii. Plaintiff must get an order from the court (not sheriff) iv. Plaintiff may have to post a bond v. Defendant should get a hearing at some point iii. How do we serve an individual?
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iv.
v.
vi.
vii.
1. Rule 4(e)(2) a. Personal Service can be done anywhere b. Substituted service i. Ok if it is in defendants usual abode ii. We serve someone of suitable age and discretion who resides there c. You can serve the defendants agent i. You can appoint one yourself, or one can be appointed by law 2. Rule 4(e)(1) incorporates method of service from state law a. Look at the state in which the federal court sits Or look at state where service is effected 3. Rule 4(d) Waiver of service by mail a. Allows you to mail the process and waiver form to the defendant. Also must send a self-stamped envelope. Def can waive formal service of process. If they do not return waiver, then you DO have to personally serve def. Requirement that agent notify defendant 1. If agent is automatically appointed by contract, or by operative law, the agents failure to notify defendant will prohibit jurisdiction, since defendant was not given an opportunity to be heard 2. If agent is voluntarily appointed by the defendant, then any failure by agent to notify defendant will not prohibit jurisdiction, since the mistake will be attributed to the defendant Requirements for cases involving multiple parties or unknown parties 1. Mullane v Central Hanover Bank & Trust Co. action brought against vast number of trust beneficiaries, scattered throughout the world. Supreme Court said constitution does not require personal service on each beneficiary, since cost would be prohibitive. However, each beneficiary had to be notified by the best practical means (by publication, etc.). 2. Mullane discusses whether the notice is constitutional a. It is ok if it is reasonably calculated under all the circumstances to apprise the party of the suit. If you meet Rule 4, almost never a constitutional problem. Ok, even if def did not get the notice. 1. But, if plaintiff becomes aware that defendant did not receive it, plaintiff may have to pursue other means of notice. Defective service of process can be challenged by a FRCP 12(b)(5) motion to dismiss or the objection can be made in the answer. Defective service of process goes to lack of notice. Due process requires notice and an opportunity to be heard.
III.
In Rem Jurisdiction (jurisdiction over the property) the basis of jurisdiction is the presence of the property in the state. Since the state has a great interest in adjudicating any rights regarding this property, it is constitutional. An in rem judgment does not bind the parties personally, but is binding as to the disposition of the property in the state. 1. A court has no in rem jurisdiction of a property not located in the forum state 2. A court has no in rem jurisdiction if the property was brought into the state by fraud or force ii. Notice The early view held that attachment of property, when supplemented by publication of notice in a local newspaper or by posting of notice on the property, would give all interested persons sufficient notice of the action. However, such procedures are no longer adequate, and the requirements of Mullane v. Central
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Hanover Bank & Trust apply to in rem actions. Thus, persons who interests are affected and whose addresses are known must at least be notified by ordinary mail.
IV.
Quasi in Rem Jurisdiction In quasi in rem cases, the plaintiff is unable to obtain personal jurisdiction over the defendant, but the defendant has property in the state that the plaintiff attached (trying to use the property to get PJ). The court then adjudicates the dispute between the parties on the basis of its power over the property. Since the courts sole basis of jurisdiction is the property, any judgment against the defendant can be satisfied only out of that property. A. When the dispute involves the rights of the parties in the property itself, jurisdiction based on presence of the property in the state is proper. The close connection between the litigation and the property provides the necessary minimum contacts. This is the same as in rem now. Previously, quasi in rem meant something else (below), which was found to be unconstitutional. B. When the dispute is unrelated to the ownership of the property, jurisdiction cannot be based solely on the presence of property in the forum state; there must be minimum contacts between the defendant and the forum. i. Before 1977, a state clearly had power over all persons and property found within its borders. A defendant with no other connections with the state could be sued in the state for any dispute simply because he owned property there 1. Pennoyer v Neff if was ok to attach the property to gain jurisdiction. Problem here was that Mitchell didnt attach the property. Instead, he seized it after getting judgment. If he had attached the property in the beginning, then there would have been PJ based on quasi in rem. ii. However, in 1977, the Supreme Court held that the minimum contacts standard is applicable to every exercise of jurisdiction. And the court found that the mere presence of property within a state is not itself sufficient to permit a court to exercise quasi in rem jurisdiction over property in a quasi in rem action. 1. Shaffer v. Heitner (1977) Heitner was a shareholder in Greyhound who sued a number of officers of the company. He moved to sequester their property in Delaware. This property included the defendants stock in Greyhound and other financial instruments. The issue was whether DE had jurisdiction over the defendants, their property, or both. Court says International Shoe test must also apply to in rem as well as in personam. Court says you can no longer attach property to gain in personam jurisdiction. So, quasi in rem jurisdiction is proper only when minimum contacts exist making exercise of jurisdiction fair and just. C. Procedural Requirements to obtain quasi in rem jurisdiction, a plaintiff must bring the asset before the court by attachment (or garnishment). D. Notice requires best practical notice, as in Mullane How to Analyze a Personal Jurisdiction Issue A. Does a statute (long-arm-statute) purport to authorize the exercise of personal jurisdiction? B. If answer is "no" then end of analysis. No personal jurisdiction can be asserted. If the answer is "yes" then; C. Does the statute go beyond the constitutional limits of due process set forth in International Shoe? D. If "yes" then no personal jurisdiction. If "no" then personal jurisdiction can be constitutionally asserted.
V.
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The Erie Doctrine A federal court, when exercising diversity jurisdiction (or supplemental jurisdiction), must apply the substantive law of the state in which it is sitting. However, federal courts will apply federal procedural law in these diversity cases. A state law claim sitting in federal court. I. Swift v Tyson (1842) - held that federal courts were free to apply the law so as to reach a result they thought was justice regardless of state common law. Overturned by Erie. II. Erie Railroad v. Tompkins (1938) A. Plaintiff walking alongside RR tracks when his right arm was severed by an object protruding from defendant's train; this happened in PA. Plaintiff filed a lawsuit in NY Fed. Court, b/c more favorable for plaintiff. The issue was what level of duty is owed to a trespasser. If PA law applied then only "wanton negligence" created liability, & no recovery. If "federal common law" applied the plaintiff could recover if the railroad was guilty of "ordinary" negligence. B. Erie held that federal courts in diversity actions apply the substantive law of the state in which they sit. In diversity actions federal courts must treat the decisions of the state courts in the jurisdiction in which they sit as a source of law. I.e., a federal court in a diversity case must apply the same law that the state court would apply. There is no longer a "federal common law," a federal court must apply the common law of the state. The rule of Erie serves the purposes of discouraging forum shopping and avoiding the unfair administration of laws (i.e., avoiding the potential for state and federal courts sitting in the same state reaching different outcomes based on the same facts.) III. If there is a federal law (statute, Federal Rule of Civ Pro, etc.) on point, then federal law will apply, provided that it is valid. A. Ex. Federal Rule 4 permits substituted service of process. Suppose that state law (of the state in which the federal court sits) does not permit substituted service. The court will apply the Federal Rule, because it is on point and is valid. A Federal Rule of Civil Procedure is valid if it is arguably procedural. i. Hanna v. Plumer (1965) Hanna, from Ohio, sued the estate of Osgood, from Massachusetts, over a car accident in South Carolina. Hanna served process by leaving documents with the wife of the executor, which complied with the FRCP, but not Massachusetts law. The issue was whether a civil action brought in federal court based on diversity jurisdiction, shall service of process be based on the FRCP or on state law. 1. Erie had established that substantive issues (when its the elements of a claim or defense at issue) would use the state law. 2. In Hanna, the law was procedural, not substantive (service of process). 3. Supremacy Clause - if federal law is on point, then it trumps state law, as long as it is valid. FRCP is very likely to be valid.. a. Rules Enabling Act establishes that FRCP good i. Rules Enabling Act prevents litigants from challenging the validity of constitutional Federal Rules via the Erie Doctrine, but the rules shall not infringe on substantive right 4. So, ok to use federal law on the service of process issue in Hanna. IV. If there is no Federal Directive on point, a federal judge can still choose to ignore state law, but it depends if the issue is substantive or procedural A. Substantive then must follow state law (Erie Problem) B. Procedural here is where it becomes a problem. Courts had never really defined this, but has given three ways to approach the problem i. Outcome-Determinative Test - holds that an issue is substantive if it substantially affects the outcome of the case 1. Guaranty Trust Co. v. York (1945) In Guaranty Trust the issue was whether a federal court in a diversity case must apply the state statute of limitations (procedural), which would have barred the suit in state court. Court used the "outcome determinative test." A state law which is normally regarded as
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"procedural" should be applied by a federal court in a diversity case if it would, or could, vitally affect the outcome of the case. a. Guaranty Trust redefined the Erie doctrine. The intent of Erie was to insure that where a federal court is exercising jurisdiction solely because of diversity, the outcome of the litigation in federal court should be substantially the same as it would be if tried in State court. Goal is to avoid reaching a different result in federal court than would otherwise be had in state court. If applying federal law would mean a different outcome, state law controls therefore state statute of limitations applies. ii. Balance of Interests Test the court weighs whether the state or federal judicial system has the greater interest in having its rule applied. 1. Byrd v. Blue Ridge Electric Cooperative, Inc. (1958) Byrd brought a tort claim against Blue Ridge. Byrd working as independent contractor, but Blue Ridge says for purposes of the workers compensation act he was an employee, b/c he was doing same work as an employee. Issue is who determines if plaintiff falls under workmans comp? In SC it would the judge. Under federal law, it was a matter for the jury. This is a procedural issue. a. Under the outcome-determinative test, the court would have to use state law. However, court found that the possibility of a different outcome was less important than the right to a jury trial (7th amendment). Therefore, court doesnt want to use the outcomedeterminative test, and establishes the balance of interests test instead. The federal interest outweighs any state interest, so plaintiff should get a jury trial. b. But problem with Byrd - never really been told how to apply it. iii. Forum Shopping Deterrence test the federal judge should follow state law on the issue if failing to do so would cause litigants to flock to federal court. 1. Hanna v. Plumer (1965) a. Under the outcome-determinative test the defendant would win i. Court here says that the outcome-determinative test from Guaranty is not absolute because there were more basic principles of Erie. 1. The Twin aims of Erie were to avoid Forum shopping and the unfair differences in administration of justice between state and federal courts. ii. Court says that while the outcome of the current case is determined by which law is applied, the rights in question are not substantial enough to create problems of unequal protection. 1. The Court says that the competing rules, though outcome-determinative, have little or no relevance to the choice of a forum. You wouldnt decide to file in state versus federal court based solely on the choice between these two laws. 2. In the current case the federal and state laws are in direct conflict. The court has been instructed to follow the Federal Rule in these cases and there is no constitutional reason not to do so. iii. In short, outcome determinative judgments are important for deciding if a state or federal rule applies but in the current case denying the federal rule would remove any power whatsoever the federal courts have over their procedures.
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V.
Interpreting State Law when fed court bound to apply state substantive law A. If state court has not decided the issue, or if the decisions on point are old and not current with decisions of other jurisdictions, then fed court may consider the law of other jurisdictions in reaching its decision. The focus of the federal court is to determine what decision the highest court of the state would reach if confronted with the issue.
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Why am I here? Incentives to Litigate; Remedies I. Incentives to Litigate a. Before going to court, questions to ask: i. What is the remedy? Are you going to get something for your client? ii. Where is the financing? How is the litigation going to get paid for? I iii. If theres nothing beneficial for yourself or your client, you wont proceed. b. Facts and figures on the success of and composition of most cases II. Two types of Remedies: a. Specific compel someone to do something b. Substitutionary Remedies are about money damages i. Compensatory Damages - Damages sufficient in amount to indemnify the injured person for the loss suffered. 1. United States v Hathaley (1958) U.S. brought suit against Navajo tribes. Govt (federal agents) illegally seized and sold the Navajo's horses and burros to a glue factory before a lawsuit that they instituted against the Navajos for grazing on federal land had commenced. The Navajos then sued U.S. for tort of illegal seizure of their property, and the Supreme Court found for Navajo, and sent the case back to district court to determine damages. The Navajos then appealed, and the issue was whether the determination of the damages awarded was appropriately calculated. No. a. The rule of damages is that the injured party needs to be put in the position it would have been in absent the wrong of the injurer. Applying the rules of compensatory damages the following must be considered: i. The market value (or replacement cost) the cost of the seized property at the time of taking. Here, cannot use fair market value b/c the animals were unique and trained to a particular purpose. So, The court should have considered the availability of like animals and all other value that go to make up market value ii. The mitigation principle (loss of use damages) Court says determine proximate cause, then calculate the reduction based on the loss of profits; and the calculation of damages fall within the time frame of from the point of the loss until the point when a reasonable and prudent person would have replaced the items. iii. Individualized measures of pain and suffering court had awarded each plaintiff same amount (b/c evidence showed that many families mourned the loss of the animals for a long time), but you cant say everyone suffered the same amount of pain and suffering. It is an individual thing, not a common injury. III. Liquidated , Statutory, and Punitive Damages a. Liquidated Damages - An amount contractually stipulated as a reasonable estimation of actual damages to be recovered by one party if the other party breaches. (Blacks Law Dictionary) b. Statutory Damages - Damages provided by statute (such as a wrongful-death-and-survival statute), as distinguished from damages provided under the common law. (Blacks Law Dictionary) c. Restitution Damages - Situations where the wrong is worth more to the wrongdoer, than the injury it caused to the plaintiff. Give plaintiff full benefit amount def got, even though it goes over the compensable damages for the plaintiff. This measure of damages is unusual usually in torts.
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d. Punitive Damages - Damages awarded in addition to actual damages when the defendant
acted with recklessness, malice, or deceit; specif., damages assessed by way of penalizing the wrongdoer or making an example to others. (Blacks Law Dictionary) i. How do you justify punitive damages, where plaintiff has been fully compensated with compensatory damages? 1. Defendant must be punished. No one else to give damages to. Court wants someone to bring def to court, so they offer punitive damages as a reason to come forth ii. Problem - some arbitrarily large amount could be awarded in punitive damages, because jury can do what they want in awarding punitive damages. This is a due process problem. 1. State Farm v. Campbell . State Farm led Campbell believe he could win the suit (which there was a very slight chance) and not settle for $50k, the maximum policy amount that State Farm would have had to pay, hoping he would win and they wouldnt have to pay anything at all. Instead, Campbell lost the suit, and he has to pay $100k in excess of what State Farm would contribute. Campbell then sued State Farm for their fraudulent practices (there was evidence that this was deliberate) and court awarded Campbell $1M compensatory and $145 in punitive damages. State Farm appealed. The issue was whether the punitive damages were excessive. a. The Court used 3 prong test (from BMW v. Gore): i. the degree of reprehensibility 1. State Farms conduct was reprehensible, to the extent that they made Campbell go to court with a losing case & then said they wouldnt pay for it. But in terms of their reprehensibility of their nationwide scheme to cap payoffs, the court did not have a right to determine this because it would violate due process ii. The ratio between actual or potential harm suffered by the plaintiff 1. Basically, to be fair there should be a 10 to 1 ratio for punitive damages to compensatory damages. Otherwise, it wouldnt comport with due process. Single-digits multipliers ok, but above 10, probably not. iii. Criminal Sanction - the difference between the punitive damages awarded by the jury and the civil penalties authorized or imposed in comparable cases 1. in comparable cases there was a $10k fine for fraud b. These methods of assessing punitive damages that the court used amounted to an irrational and arbitrary deprivation of the plaintiff's property, violating the Due Process Clause of the 14th Amendment. c. Dissent due process clause or the rest of the constitution doesnt actually provide a basis for rule in giving punitive damages; its up to states discretion. Also, State Farms behavior warranted the damages (they also destroyed documents requested in discovery). Specific Remedies a. The idea of specific relief i. Specific relief could be (consider that the Campbells sold their house to pay for the damages) 1. Injunctions to make them to do or stop doing something (most common) 2. They sell the house, sign the contract, then decide not to sign the deedthe court commands them to leave under threat of contempt of court
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3. They sell the house, but don't leavethe court sends a sheriff to eject them 4. They leave the house but forget some jewelry in itthe court sends the sheriff to retrieve it on act of replevin 5. Specific relief solely cases are tried by a judge b. Equity and Specific Relief i. Key point is that the accepted standard was that equitable remedies were available only if the legal remedy was inadequate ii. Specific performance is an equitable remedy (equitable remedy - where money damages are not available). 1. If def doesnt pay money damages - you can just seize their property and sell if off. If def doesnt do the specific performance, then they are in contempt of court and can go to jail. 2. So equitable remedy is secondary 3. So if you can accomplish the same purpose with money damages, better to just use this. More efficient for the judicial system. c. Is there a Remedial Hierarchy? i. Equitable remedies require a showing that money damages are inadequate ii. But courts are more lenient these days to grant injunctive relief iii. However there are situations where injunctions usually wont be grantedlibelous newspapers (because of infringing on the first amendment), or when it might be too hard on the defendant iv. The Sigma case rejects the latter argument in this case v. You can only get injunctive relief (permanent injunction) - requiring specific action, only if here is no adequate remedy at law. 1. Sigma Chemical v. Harris Upon employment at Sigma, Harris signed a noncompete agreement, where he was barred from working for a competitor for 2 years after leaving Sigma, and to never divulge trade secrets. Harris ended up breaching agreement on both terms, and Sigma sued. Issue is whether permanent injunctive relief sought by plaintiff is valid. Competitor benefits from the wrongfully acquired knowledge. Sigma doesnt want money damages, but only for Harris not to disclose trade secrets. Too hard to quantify the amount of profits received from the knowledge - no adequate remedy at law for this. So injunctive relief valid. a. Harris breached the agreement - it is relevant because in equitable remedies, such matters as the relevant moral worth of parties are considered. Compensatory damages not enough, so we need to prevent him from disclosing trade secrets. b. Why doesnt court order him to work for Sigma? - may not be effective b/c both parties may not want this. c. Court can say that Harris cant work at other places instead. More efficient to forbear them from working somewhere else. This is what they do. d. Injunctive relief - better to give a prohibitory injunction, rather than a mandatory injunction. e. Injunctive relief requires ongoing court supervision. f. Normal thinking in equity is "can we effectively work something out that would accommodate all the interests involved?" as opposed to money damages
V.
Declaratory Relief a. Declaratory relief/judgment declares the rights, duties, or obligations of each party in a dispute. It is typically requested when a party is threatened with lawsuit and the threatened
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lawsuit is not yet filed; or when it is thought by one of two (or more) parties that their rights under law and/or contract might conflict; i. What problem does this try to solve? - there are cases where you want to get a declaration because it would be inefficient to incur damages after actions have started ii. On the other hand - there is a constitutional limitation (article 3); there have to be actual cases or controversies. iii. Has to be within the context of an actual controversy in a jurisdiction Cant expand the jurisdiction of the federal courts. VI. Financing Litigation a. The American rule i. There are all different methods of financing litigation. In practice, this question becomes increasingly important. How are we going to be paid? ii. Under the American Rule, everybody pays their own lawyer. Under the English Rule, the loser pays all litigation costs. 1. There is no incentive to file a totally frivolous lawsuit under the American rule. 2. The marginal case is dropped in the English system, because its not worth the risk of incurring both your own costs and the defendants costs. a. Problem with this is: you have to pay for both legal fees. Plaintiff may not bring a case if they think they would have to pay def legal fees as well as their own. i. Modification for this problem - statute will provide for loser to pay the winners legal fees, (section 1988) but a winning def doesnt unless def can show lawsuit shouldnt have been brought. In favor of lawsuit being brought. iii. Undercompensation problem 1. Fees many times subtracted from winnings. Without compensation of legal fees, the winnings greatly decreased because of this. 2. Ppl may not go to court because of the legal fees, because it wouldnt be economic. 3. Access to justice problem a. Without a lawyer, probably wont be a recovery. This problem is solved if loser pays the winners legal fees. b. Other ways to give access to lawyers rather than having loser pay fees. i. Insurance - How do you defend yourself when you get sued for a car accident? You start out by calling your insurance company; your car insurance usually has coverage for legal representation when you get sued. So who becomes one of the parties in interest? The insurance company takes an interest in the outcome of the suit. Insurance companies bear a lot of litigation costs and therefore want to settle even frivolous claims. ii. Contingency fees - The lawyer agrees to provide legal services with fees to be paid out of a percentage of the proceeds of the litigation. This is the chief way that plaintiffs are able to finance meritorious litigation. Thats because the costs per hour for attorneys fees are simply too great for most individuals to bear except in certain contexts. 1. Illegal in criminal cases and divorce cases - we dont market to sort out those cases. Give lawyers incentive to do things you dont want done. iii. Public subsidies (legal aid) - There are agencies at all levels of government that provide legal assistance to needy plaintiffs. iv. Professional Charity (pro bono) - Pro bono work is free work that regular old lawyers would do for needy plaintiffs.
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c. From fee spreading to fee shifting i. Fee Spreading 1. The common fund plaintiff creates a fund for others to chip in for litigations costs, when the lawsuit benefits others, not just the plaintiff. ii. Fee Shifting 1. By contract you can contract that if litigations arises, loser pays winners lawyer. 2. By common law a situation where by common law, the loser would pay winners fees is when plaintiff has groundlessly brought a suit (malicious prosecution) 3. By statute states enact statutes that will shift legal fees.
VII.
VIII.
Provisional Remedies decided before trial; if situation is not dealt with immediately it will result in irreparable harm to the plaintiff, you need preliminary relief; designed to maintain the status of the item in question from now until trial begins. a. Rules 64-66 Rules of Provisional Remedies i. Types of remedies arrest, attachment, sequestration, replevin, etc. 1. Replevin - repossession of personal property wrongfully taken or detained by the defendant ii. Rule 65 (a) Preliminary injunctions Need hearing first. Youre going to order someone not to do something following a hearing. iii. Rule 65(b) Temporary restraining orders b. Issue with provisional remedies. i. In theory - provisional remedy only lasts until trial; and no harm done. ii. In practice, this is not true. Many cases are disposed of in the provisional remedy stage. Not because of what happens in the litigation, but of the resulting pressure. Judge may say "you survived this long, so why shouldnt I leave it as is?" If plaintiff gets strong provisional remedy - strong settlement and even surrender is likely c. Justification for provisional remedy as state law nothing on point in FRCP, so follow state. d. William Inglis & Sons Baking Co v. ITT Continental Baking Co - Some baking companies sued some of their competitors in an antitrust action. Def says bread prices made in good faith to meet competition. One plaintiff moved for a preliminary injunction. i. The district court denied the injunction. 1. Said the plaintiff is entitled to a preliminary injunction if: a. P will suffer irreparable injury if injunctive relief is not granted b. P will probably prevail on the merits c. In balancing the equities, the defendants will not be harmed more than P is helped by the injunction d. Granting the injunction is in the public interest 2. The court found that plaintiff probably would not win, and that's why they denied the injunction ii. This was appealed. The issue now is if the district court applied the correct test in denying a preliminary injunction 1. Court here says there is an alternative test which allows a preliminary injunction even when the chance that the plaintiff will win is uncertain. Under that test, there need only be a fair chance of success on the merits so long as the damage that the plaintiff may suffer is sufficiently serious. The Court of Appeals finds that the district court needs to consider this test as well as the one it actually applied. Provisional Remedies and Due Process - Before the government can take your property, you must have notice, and you must have a hearing of some sort. Thats procedural due process.
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a. Due process problem for plaintiff to seize property with the provisional remedy because if right to property is protected because then we are more likely to come to a just result. We want our provisional remedy to mirror the result of trial. i. Possible Loss - you dont have your property (property deteriorating); irreparable injury continues; The more process, the more delay. b. Fuentes v Shevin - Fuentes bought from Firestone and later had a dispute over the property. Firestone went to small-claims court to repossess the property and got a writ of replevin before Fuentes was even notified of the proceeding. Fuentes sued, saying that her 14th Amendment right to due process had been violated. i. Fed court finds that state stature on replevin no good. It violated due process item seized w/o notice. ii. Originally, burden of proof that property was taken w/o merit on Fuentes, but the burden is on the wrong party. How can Fuentes know why they seized it if she had no notice? So, she couldnt prove anything b/c she didnt know what she had to prove. 1. Also, no hearing to prove she didnt make payment as Firestone said. 2. The person who has the item has a right to keep it until the verdict, and whoever wants to displace it has the burden of proof. a. Ultimate merits of who is entitled to the item is decided during trial
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Framing, Answering and Amending the complaint I. Simple pleading and practice a. Pre-code pleading and practice i. Common law issue pleading and practice if you plead wrong writ, out of court. ii. Equity pleading & practice flexible but encrusted with barnacles b. Code fact pleading and procedure i. Used in colonies. Less formal, but rigid. Abolished common law pleading in favor of fact pleading. Some jurisdictions still use it (CA pleading on the facts). II. Modern notice pleading a. The specificity of notice pleading to give notice of claims or defenses i. Could just be a notice of suit, or detailed statement of fact ii. For the complaint to be dismissed, the pleader has to make allegations that on the face show a bar to relief iii. Pleading purpose is more to prepare the defense than to let the court determine case validity iv. Court struggles in deciding if they should bar insufficient claims b. Consistency and the theory of the pleadings in modern pleading i. Test for sufficient of claim is whether pleader has stated a claim under any legal theory 1. Not wholly there because 1. Compelled election of the type of claim is not fair 2. Rule 8(e)(2) and Rule 8(a) allow multiple claims despite inconsistency and alternate claims for relief 3. Rule 15 (b) allows pleadings are adapted to the evidence and to variances, with consent 2. But still relevant because of estoppel, statute of limitations, jury, pretrial orders, obligations of candor and care c. The form of notice pleading no special forms; official forms are examples d. Special pleading rules in modern pleading not the norm (ex. Mistake or fraud)
III.
FRCP Chapter III: Rules of Pleadings, Answers, Amending a. Rule 7: Pleadings allowed - complaints, answers to complaints/Crossclaim/counterclaim, 3rd party complaint, etc. Request for court order must be made by motion, which must be in writing, specifics of why seeking the order, what relief you want b. Rule 8 General Rules of pleading i. 8(a) Requires short & plain statement of the (1) claim, (2)grounds for courts jurisdiction, (3)showing that the pleader is entitled to relief and (4) demand for judgment ii. 8(b) states that the defendant's answer must admit or deny every element of the plaintiff's claim iii. 8(c) also requires that the defendant's answer state any affirmative defenses. c. Rule 9: Special Matters. Rule 9 sets out matters which have special requirements of pleading (for ex. Fraud or mistake requires additional details instead of short statement) d. Rule 10: Form of Pleading - describes the format required. e. Rule 11: Signing of the Pleadings, Motions, and Other Papers; Representations to the Court; Sanctions i. 11(a) Everything has to be signed by at least one attorney, or by party if pro se. Also needs contact info of signer. ii. 11(b) Representations to court - by signing the attorney is certifying to the best of her belief, formed after an inquiry reasonable under the circumstances, that: 1. it is not being presented for any improper purpose such as to harass or to cause unnecessary delay or needless increase in the cost of litigation
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2. the claims, defenses, and other legal contentions therein are warranted by existing law, or a nonfrivolous argument for modification of a law, or establishment of a new law. 3. the allegations and other factual contentions have evidentiary support or, will probably have after further investigation or discovery 4. the denials of factual contentions are warranted on the evidence or reasonably based on lack of reasonable belief or information 5. Note: Certification: Rule 11(b) the certification applies anew each time an attorney or pro se litigant later advocates a position contained in the pleading, motion, etc. Thus, a paper that was not sanctionable when first presented may become sanctionable if the attorney or pro se litigant advocating a position contained in the paper has since learned that the position no longer has merit. iii. 11(c) Sanctions The court has discretion to impose sanctions, limited to deter repetition of such conduct, against a party who presents a paper to the court on any of the above requirements, either on the courts own initiative or on a motion of the opposing party. Where appropriate, sanctions may be imposed against parties, attorneys, or law firms, and may consist of nonmonetary directives or monetary penalties including payment of expenses and attorneys fees incurred b/c of the improper paper. iv. Note: Usually, client will bring the lawsuit last possible moment - only 3 weeks to respond. If you dont assert defenses in answer, cant use it in trial. But if you include every defense, you violate Rule 11. Usually, a lawyer will get extensions to properly investigate and file the answer with appropriate defenses Rule 12: Defenses and Objections: i. 12(a): Specifies the time to serve a responsive pleading, unless otherwise stated as federal statute ii. 12(b): Prior to filing an answer, the defendant may, if he chooses, file a motion and raise any or all of the following defenses: (*Defense that can be raised at any time) 1. Lack of subject matter jurisdiction (*Defenses that must be raised at the time defendant files a motion or his answer whichever is first. If he does not, the he waives these defenses) 2. Lack of personal jurisdiction 3. Improper venue 4. Insufficiency of process 5. Insufficiency of service of process (*Defenses that can be made at any time until trial ends) 6. Failure to state a claim upon which relief may be granted (i.e., even if plaintiffs allegations are taken as true, relief could not be granted as a matter of law); or 7. Failure to join a party needed for a just adjudication (includes necessary and indispensable parties iii. 12(c) after pleadings are closed, a party may move for judgment on the pleadings iv. 12(d): Result of Presenting Matters Outside the Pleadings. v. 12(e): Motion for a more definite statement - A party may move for a more definite statement of a pleading to which a responsive pleading is allowed but which is so vague or ambiguous that the party cannot reasonably prepare a response. If court orders, and not done within time limit, court may strike the pleading or issue any other appropriate order. vi. 12(f): Motion to strike - The court may strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.
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V.
VI.
Mitchell v. E-Z Way Towers, Inc. Mitchell alleges EZ violated the Fair Labor Standards Act and an action for injunction against the defendant. District Court granted defendants motion to dismiss the complaint for failure to state a claim, because there was a lack of specifics on the employees hours and wagesthe subject of the Act (actually plaintiff would have to get this from def during discovery, no way for him to have known the specifics).The issue was whether the dismissal was appropriate. Held that it was not. The complaint should not have been dismissed for failure to state a claim, because it did not appear beyond all doubt that plaintiff could prove no set of facts. The trial court confused FRCP 12(b)(6), motion to dismiss for failure to state a claim, with 12(e), motion for a more definite statement (which just allows for discretion), the latter of which is not grounds for dismissal. Allocating the elements Which party has the burden of pleading, producing evidence, or proving a particular element of a claim? a. Different approaches to systemizing the burden allocation; they are incomplete i. Easiest access to knowledge (but doesnt accurately describe most cases) ii. The party asserting the improbable iii. Policy usually a substantive one (rather unclear) b. Gomez v Toledo Gomez is a cop in P.R. when he finds out about some shady stuff going on, and hes the whistle blower. He gets moved around, then fired. He sues on being denied due process under 1983 (deprivation of rights under color of law), b/c Toledo is a govt official. But 1983 gives immunity to govt officials if they were acting in good faith. So Toledo moves to dismiss under Rule 12(b) failure to state a claim because Gomez did not says that Toledo was acting in bad faith. Issue was who had the burden to plead this. Court says its Toledo, because good faith/bad faith is an affirmative defense. Basically, all Gomez has to plead are the objective parts. Toledo subjective intent (good/bad faith) couldnt be pleaded by Gomez because under Rule 11 how could he possible state the officers intent here? However, Toledo knows what his intent was, so his burden. This would eventually be found out during deposition and discovery, but for pleadings purposes, its defs burden. Ethical limitations and disfavored claims a. Ethical Principles of a limitation Rule 11 places a great emphasis on the duty of lawyers to avoid abuse of litigation by requiring an attorney to investigate both the legal and factual basis of a claim before filing suit, and by promoting increased use of sanctions for violation of various rules. Courts have begun using sanctions energetically (some think too energetically) to punish those who bring groundless suits, an effort that may deter some groundless litigation. i. Business guides v. Chromatic Communications Enterprises (1991) - Rule 11 requires the lawyer to conduct a reasonable inquiry into the facts and the law before filing a claim, and the applicable standard is one of reasonableness under the circumstances. ii. Religious Technology Center v Gerbode (1994) RTC sues Gerbode on fraud. RTC amended complaint was dismissed. Def argues the claims presented were filed
and presented for an improper purpose which was not warranted based on established or existing law. Reasonable inquiry would have had RTC realize that
the complaint was unwarranted, so defendant seek attorneys fees for having to defend against frivolous lawsuit. Rule 11 says that you have to make reasonable inquiry before submitting the complaint, so court says sanctions ok for plaintiff. Courts discretion whether to award def attorneys fees, but here they do, in addition to monetary penalty paid to court. Answer the answer must contain a specific denial or admission of each averment of the complaint, or a general denial with specific admissions to certain averments (Rule 8(b)) a. Zielinski v. Philadelphia Piers, Inc. (1956) Zielinski sues PPI on a tort claim. What Zielinski doesnt know (and he made reasonable assumptions), is that another company CCI, leased PPIs stuff, and CCI would have been the one liable. But when PPI answers
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b.
c. d. e.
f.
g.
Zielinskis complaint, they deny them in general, but not specific parts. If they had plaintiff would have realized his mistake and sued CCI instead. But statute of limitations has run out, so they cant sue the right party. The court lets PPI go to trial, and instructs the jury that PPI admitted they were the ones responsible for all equip and employees that caused the tort (so if negligence proved, PPI will be responsible). i. It was an ineffective denial under Rule 8b (which required that defendant file a more specific answer than a general denial). A proper denial would have broken down the component parts, which would have been a signal to the plaintiff that the plaintiff sued the wrong party. The plaintiff could have then amended his pleadings. PPI needed to clearly state that yes, they owned it, but they did not operate it. ii. Note: although court believes there was no bad faith here, they still say PPI must go to trial. A big consideration was that both PPI and CCI had same insurance, which would ultimately pay any damages, so it didnt really matter who gets sued. iii. If the complaint is written in an organized way, they will get a better answer. But, the burden is on the responding party. iv. Note: Rule 15c wasnt in effect at this time, but if it was could have been used. Amendments given extension if it relates back to original complaint. Where the defendant is without knowledge or information sufficient to form belief, a statement to that effect constitutes denial. A failure to deny constitutes an admission (except for denial of amount in damages). The answer must also state any affirmative defenses the defendant may have, such as statute of limitations, Statute of Frauds, res judicata, etc. Denial - In some situations, denials can be evasive so the court will hold them insufficient, and could it as an admission. i. Negative pregnant a negation which implies an affirmation. i.e. I didnt steal money from you last Tuesday, may imply it could have happened another day. ii. Making a contradictory statement rather than a categorical denial. i.e. alleged def was in Chicago on said date, and def answers that he was in NY on said date - this could be held bad as an argumentative denial. Two opportunities for defendants to respond: i. Pre-answer motion - permits defendants to raise certain types of objections to the action at a very early stage of litigation. Responses include: 1. Reasons why the court should not proceed with the action 2. Assertions that the complaint, even if true, provides no basis for legal relief 3. Denials 4. Affirmative defenses 5. Requests for clarification and more information 6. All responses except requests for info may be included in the defendant's answer. If def doesnt make such a motion, or the motion is denied, they must file and additional pleading, called an answer. ii. Answer - responds to the allegations of the complaint and asserts any additional information or affirmative claims that the defendant may have against the plaintiff. 1. Both the pre-answer and the answer serve as key strategic early moments of the lawsuit, as the parties define the contours of their disagreement and maneuver for early advantage. Affirmative Defenses (Rule 8c)
Layman v Southwestern Bell Telephone Co. - Bell lays cable on Layman's land. She thinks they've trespassed onto her land, causing the value of her property to depreciate. Court finds for defendant Bell because they show they had an easement granted by the previous owner and that plaintiff had given permission for installation of cable across her land. However, Bell's answer only made a general denial (they denied everything and demanded
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VIII.
proof of everything). The issue is whether the easement is to be considered an affirmative defense that Bell had to have put in answer, or else waive the right to use as evidence during trial. Court says it is, under Rule 8(c), although doesnt list easements specifically, it says, any other matter constituting an avoidance or affirmative defense. 1. Test is that if there are any facts that would let the defendant avoid any legal responsibility, the defendant must out them in the answer, as an affirmative defense. 2. The pleadings are supposed to show each party the issues, and to put them on notice, w/o surprise, and Layman did not know, and was surprised. For justice and efficiency. Layman should know what she has to prove (maybe she would settle instead), and court wants to efficiently sort out cases during pleadings. Also, burden on def b/c they HAD to know of the easement b/c they sent employees to property. Reply In most cases the pleadings end with the answer. This is true whether there are specific or general denials. However, if the answer contains a counterclaim (which is labeled as a counterclaim), Rule 7(a) requires plaintiff to reply. Also,, court, at its discretion, can order a reply (but this is very rare). Amendments a. There are 3 ways to amend: 1. One way for the plaintiff 2. One way for the defendant 3. One way the judge can help you out ii. You may amend once "as a matter of course" before you get the answer. This is basically a plaintiff's rule. The plaintiff files a complaint, and you can amend it once before the answer comes back. If there is no responsive pleading due (like an answer, because there's nothing that comes after it), you have 20 days to amend it. Typically, you also have 20 days to answer the complaint, so it's kind of a mirrored rule. If you dont qualify for these two windows, you must ask leave of the court, which will be given freely as justice requires. a. Rule 15 15(a): A pleading may be amended once before a responsive pleading is served, or if no responsive pleading is required, within 20 days of service of the pleading. Thereafter, a pleading may be amended only by written consent of the adverse party or by leave of the court upon motion. Leave of the court is freely given when justice so requires. 15(b): Amendments During and After Trial A pleading may be amended during or
after trial or even after judgment to conform to the evidence, reflect an issue actually tried by express or implied consent of the parties, or permit raising new issues at trial. However, a party may not raise a claim or defense for which the opposing party had no opportunity to prepare and which would result in prejudice in maintaining his action or defense.
IX.
15(c): (1) Relation Back: Amendments relate back to the date that the original pleading was filed if the conduct, transaction or occurrence set forth in the amendment was set forth or attempted to be set forth in the original pleading. Amendments also relate back if relation back is permitted by that provides the statute of limitations applicable to the action. (2) Changing
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Party: An Amendment changing the party or the naming of the party against whom a claim is asserted relates back if the amendment concerns the same conduct, transaction, or occurrence as the original pleading and if, within 120 days after filing the complaint (and such additional time as the court may order upon showing of good cause) the party to be brought in by amendment: (a) Has received such notice of the action that she will not be prejudiced in maintaining her defense on the merits; and (b) Knew or should have known that but for a mistake concerning the proper partys identity, the action would have been brought against her. 15(d): Supplemental pleadings relate to matters occurring after the date of the original pleading. The permission of the court, upon motion, is required. Permission may be granted even though the original pleading is defective in its statement of a claim for relief or a defense. b. Prejudice Rule 15 suggests a tension btwn 2 goals: easy amendment, which allows the pleadings to reflect the parties changed view of the case as it develops; and the notion of prejudice, which reflects the idea that at some point the other side has to make decisions about how to present its case, decisions that become difficult if the story it has to meet continually shifts. Beeck v. Aquaslide N Dive Corp (1977) Aquaslide sued on products liability claim. Aquaslide insurance investigates, and says, yes it was manufactured by defendant, so Aquaslide admits this in answer and in discovery. President of Aquaslide then goes to look at it, and realizes its not Aquaslide, wants to amend their answer, but 20day window has run out. Court gives leave to amend, according to Rule 15. Court says leave to amend will be freely given in the absence of any reason that leave shouldnt be granted; courts mustn't allow delay, bad faith, or prejudice. No bad faith, Aquaslide reasonably relied on info from insurance rep. 1. The plaintiffs didnt really do anything wrong, but theres a good reason to grant leave to amend. The plaintiffs say that there is prejudice though, because the statute of limitations has run out - the plaintiffs cannot now sue the true manufacturer for personal injury. But the court says the plaintiff might have causes of action that can get around the statute of limitations, so the prejudice isnt as great as the plaintiff says. 2. Plaintiffs later sued Aquaslide on fraud b/c they have had other lawsuits based on copied Aquaslides designs, and president should have known this was possible, so according to Rule 11, he failed to make a reasonable inquiry. Statute of limitations and relating back (Rule 15(c)) i. Absent some absolute cutoff, you can always beg the court to amend. But if the statute of limitations has run, the cause of action is cut off. Rule 15c talks to use about what we can do with regard to amending our petitions and having those amendments relate back to when we initially filed the complaint. This is a tool to get out around limitations. If we can get our amendment to relate back, then we've avoided the statute of limitations problem. It will relate back if it relates to the same "conduct, transaction or occurrence." This was an unclear, problematic amendment when it was adopted, but now there is more clarity about when it applies. Moore v Baker (1993) Moore sues Baker on medical malpractice, lack of informed consent. Statute of limitations runs out, and Moore wants to amend
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complaint to include simple negligence. Issue is whether Rule (c) relating back will allow her. 1. Court says Moore's claim does not arise out of the same conduct, transaction, or occurrence as the claims in the original complaint there was no negligence mentioned in the original complaint. Therefore, the amended complaint does not relate back to the original complaint, and the proposed new claims are barred by the statute of limitations. The doctor wasnt on notice that he had a negligence claim against him. The concept behind pleading is that we put you on notice. But all the doctor knew about was the claim involving informed consent. Bonerb v Richard J Caron Foundation (1994) Bonerb sues on tort claim that def negligently managed the facility. Plaintiff then wants to amend with a new allegation of counseling malpractice, but statute of limitations has run out. Def argues new claim doesnt relate back to original claim, but court says it relates back to same facts, so allows the amendment. Difference btwn the two: 1. One reason the two cases are different is the surprise element. Courts are more willing to let you relate amendments back if its not going to be to the detriment of the other side. In first case, since def filed for summary judgment, prob discovery already over, so the amendment would be a surprise and unfair. 2. In the Bonerb case, we start with the general claim of negligence and then try to slice out a particular kind of claim. Thus, courts may favor amendments that move from the general to the specific. 3. Two courts look at the same Federal Rule with the same language, but come out differently. So the Rule doesnt have complete clarity on its face.
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