Chris Borniger Civil Procedure Outline Table of Contents

Chris Borniger Civil Procedure Outline Table of Contents..............................................1

CIVIL PROCEDURE
Chris Borniger Spring 2008 Professor Woolley

Claims and Defenses

I. Introduction A. Anatomy of Claims and Defenses Every rule of substantive law can be put in the form of a conditional imperative. Litigators translate conditional imperatives into claims and affirmative defenses. Valid claim = a set of facts that gives rise to a right to relief in the courts. o If = element material to the claim o Unless = affirmative defense B. Determining Validity of a Claim or Affirmative Defense Validity of claim o Do the if/then clauses accurately state a rule of substantive law? o Do the actual facts fit the conditional imperative? Affirmative defense: Ds only option if the claim is valid o Does the unless clause provide a defense to liability under the substantive law? o If it does, do actual facts correspond to the unless clause? C. Burdens for Asserting/Proving Elements of a Claim/Affirmative Defense Burden of Pleading (BoPle): Responsibility for alleging an element in the pleading o If on P: If complaint doesnt state a claim, D can file motion to dismiss (12(b)(6)). o If on D: If answer lacks an affirmative defense, the issue is out of the case. o Caveat: Pleadings can be amended, even at trial, even after other party has made motion to dismiss. Burden of Production (BOPro): Who loses if no evidence is produced with respect to a particular element? o Party meets this burden only if reasonable jury could find for that party. If not, court can grant judgment as a matter of law. Burden of Persuasion (BoPer): Risk of not persuading the factfinder o Can only be understood in the Standards of Proof Preponderance of the evidence: More likely than not (civil) Clear and convincing evidence: (some civil) Beyond a reasonable doubt (criminal) 1|Page

D. Allocation of Burdens Linguistic clues: Look to statutes enacting clause (but may not be clues) Gomez v. Toledo: o Issue: How to allocate elements material to a 1983 claim (civil rights) o Elements of a 1983 claim: Deprivation of federal rights Under color of state law (actions by official in official capacity) Only if official acted in bad faith (read in by SC). Question: Was burden of pleading on P (to allege bad faith), or on D (to plead as an affirmative defense)? Facts: P claims he was fired without procedural due process. Procedural history: P files complaint alleging first two elements of 1983; D answers with denial and asserts several affirmative defenses. D moves to dismiss under 12(b)(6). Inappropriate here. D has to make motion before answer. Should have gone for 12(c): Motion for judgment on pleadings P loses on 12(b)(6) motion. 1st Circuit affirms. P appeals to SC. Risky move P didnt amend his pleading. He didnt want to have to prove bad faith at trial, but he let trial court enter judgment against him. If P had lost at SC, that would have been the end of his case. Majority opinion: D has to plead good faith as an affirmative defense.

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Ds good/bad faith is entirely within Ds knowledge; subjective. (But similar issues often allocated to P, like in fraud: intent to deceive) Plain language of 1983 and legislative history (But qualified immunity was nowhere in statute; it was read in. So if you rely on QI, youre not relying on statute.) Precedent: Ambiguous and not helpful here Established practice in analogous legal areas (issue treated as AD) Real driver may be policy: In close cases involving qualified immunity, tip the scales in favor of the P. o Concurrence by Rehnquist: Aims to limit scope of the decision. Wants to leave open the issue of the burden of persuasion. Affirmative defenses vs. negative defenses o Affirmative: D has to assert it or its out of the case o Negative: Ds obligation to admit or deny allegations by P o Rule 8(c)(1): Matters to be asserted as affirmative defenses in a pleading Other considerations in allocation: Fairness, precedent, policy

II.

Pleading Claims and Defenses A. Pleadings vs. Motions Pleadings frame the dispute (requirements: Rule 7(a)) Motions ask judge for action (requirements: Rule 7(b)) 2|Page

B. Rule 11 Deters frivolous pleadings: Go no further than a reasonable lawyer would Must engage in a reasonable inquiry into law and facts before pleading. Failure to plead honestly, or pleading honestly without a reasonable inquiry, violates Rule 11. 11(b): rules for determining if pleadings or motions are valid C. Pleading Philosophy of the FRCP Pleadings much less important than they used to be (because of discovery) Early procedural systems had little to no mechanism of discovery; relied on pleadings. Thus, pleading rules were much stricter. D. Amending the Pleadings Purpose: Make pleading errors less critical. FRCP aim to resolve lawsuits on the merits instead of technicalities of pleading. Rule 15(a)(1): Right to amend pleading once as a matter of course If pleader doesnt satisfy conditions of (a)(1), 15(a)(2) says a party may amend with opponents consent or with courts leave o Court should freely give leave when justice so requires o Unless pleader is abusing process, an amendment will be allowed unless the other side would be prejudiced (i.e., opposing party would suffer because pleader got it wrong the first time. Example: Beeck v. Aquaslide. A admitted it had made defective waterslide, but it actually hadnt. Company president learns mistake while examining slide during deposition. Court allowed A to amend its answer even though it created major statute of limitations problems for B. Woolley: Court should have held A to its admission. If undue/unjustified delay in seeking to amend: The greater the lack of diligence in seeking to amend, the less prejudice the other side will have to show to defeat the amendment. E. Construction of the Pleadings In old procedural systems: Pleadings strictly construed. No benefit of the doubt. Today: Rule 8(e): Pleadings should be construed so as to do justice. F. The Complaint What must be pleaded in the complaint? o Rule 8(a)(2): Pleading must contain a short and plain statement of the claim showing that the pleader is entitled to relief. o Conley v. Gibson (1957): SC: Dont have to detail all the facts; just give a short and plain statement of the claim that gives the D fair notice of what Ps claim is and grounds on which it rests. Complaint shouldnt be dismissed unless P can prove no set of facts in support of his claim that would entitle him to relief. 3|Page

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But Conley and Rule 8 cant mean that an abstract statement is OK. Complaint has to give some discussion of the facts giving rise to the claim. Old Form 9 shows what level of specificity can be required at least in a simple negligence claim. Old Form 9 (now Form 11): Rule 84 said this is sufficient to state a claim for negligence, though it doesnt expressly allege all the elements. Duty and breach are implied. Twombly case answers some questions, raises more. 8(a)(2) is enforced through 12(b)(6). Use 12(e) (motion for a more definite statement) if its a vague claim that D has no idea how to answer. Policy considerations for what must be pleaded in the complaint Advocates of loose pleading standards: P with a good case shouldnt be tossed out of court before the discovery process can show that the case is good. Advocates of tighter pleading standards: Discovery processes and summary judgment motions are very expensive ways of finding out whether a claim has merit. Requiring a P to plead every element of a claim and provide some factual basis eliminates the wait for discovery, if the P in good faith under Rule 11 is unable to plead. Appropriate resolution may depend on complexity of the case. Discovery and SJ practice cost more as a case becomes more complex; more specificity and better pleading may make sense. Amendment of pleadings is another reason why dismissal may waste judicial resources. Bell Atlantic Corp. v. Twombly Key allegation: Ds agreed to avoid competition among themselves and stifle competition from others in order to inflate prices. (Agreement + parallel conduct) Procedural history: Fed.Dist.Ct. granted 12(b)(6). Fed.App.Ct. reversed. Issue: Did pleading state a claim for which relief could be granted? Majority opinion: 12(b)(6) was properly granted. Allegations of parallel conduct alone are insufficient under 8(a)(2) to show pleader is entitled to relief. Gives no weight to allegations of agreement; says complaint is really just restating allegation of parallel conduct by saying there was an agreement. Bare allegation of agreement doesnt give the notice required by Rule 8. Majority clearly trying to replace the Conley standard. Under no set of facts standard, allegations of parallel conduct should have been enough if complaint includes allegation of agreement. Courts typically say all elements of a claim must be pleaded expressly or impliedly. Twombly arguably says that if the element is pleaded in conclusory form, thats insufficient. Twombly will lead to significant heightening of pleading standards. It insists that the pleader show hes entitled to relief.

G. Responding to the Complaint: Rule 12 (see handout) 4|Page

D must respond in timely manner or risk default judgment. o May first file a pre-answer motion to dismiss under 12(b) o Or may answer the complaint Precision in terminology: A motion is not a pleading. And Rule 12(b)(1)-(7) arent motions, theyre defenses that can be set forth in a number of vehicles: o Motion to dismiss o Motion for judgment on the pleadings (if not waived) o Responsive pleading Rule 12 sets forth four disfavored defenses: o Personal jurisdiction o Insufficient service of process o Insufficient process o Venue Three favored defenses (can be asserted in motion for judgment on the pleadings or in the answer): o Lack of subject matter jurisdiction (can be raised at any time) o Failure to state a claim on which relief can be granted o Failure to join a party If D forgoes a pre-answer motion on any ground in Rule 12, D loses any of the 4 disfavored defenses that were available and that D failed to assert in the answer or in an answer amended as a matter of course under 15(a). o 12(e) [more definite statement] and 12(f) [strike]: Cant make these motions once youve made a pre-answer motion. They must be part of the pre-answer motion.

H. Responding to the Complaint: The Answer Overview o Contains response to Ps claim + any counterclaims or third-party claims o Claim vs. counterclaim: Depends on who sues first Counterclaims: o Compulsory: Arises out of the same transaction or occurrence. If D doesnt raise a compulsory counterclaim in the answer, its lost for good. o Permissive: Allowed if theyre not asserted in the answer; D could bring a separate suit. Defenses: Almost always included (or else D might as well fork over money) o 12(b) defenses o Affirmative defenses: elements material to a claim; D has BoPl. Counterclaims vs. affirmative defenses o Counterclaim: seeks relief against P o Affirmative defense: asserted to defeat Ps claim, even if its true Admissions and denials o Must admit or deny point by point. General denials OK only if Rule 11 (honest pleading) is satisfied. o 8(b)(3) lays out rules of general denial; D has to deny in good faith. o Fuentes v. Tucker: effect of admissions 5|Page

Facts: On day of trial, D amends answer to admit liability in deaths of 2 kids in auto accident; D doesnt want jury to hear evidence about circumstances of accident (he was drunk driving) when deciding on damages. Trial court let in the evidence anyway. CA.Sup.Ct. affirmed, saying evidence admission was harmless error that didnt prejudice the D (a dubious judgment). Two points: Matters admitted by D are omitted from case. Sometimes a good tactic to admit where not required by Rule 11.

I. Responding to the Answer Motion to strike: Rule 12(f) o Challenges a defenses legal sufficiency. o You never lose the right to have court conclude that a defense is legally insufficient. But you have to bring 12(f) motion within 20 days of pleading. But 12(h)(2) lets P argue failure to raise a defense in motion for judgment on the pleadings. Or P can argue at trial that defense hasnt been made out. Replying to affirmative defenses o Use a 12(f) motion o Generally, no reply to Ds affirmative defenses is required, but court may order one (very rare). o If reply isnt required, 8(b)(6) says an allegation is considered denied or avoided. Answering a counterclaim o P is always required to assert any defenses to Ds counterclaim, in the answer to the counterclaim. o Same rules govern answer to counterclaim as govern answer to complaint. o And same rules govern pre-answer motions in both cases.

Pleading practice a summary Claim [ ] Complaint [ ] Rule 12 pre-answer motion [ ] Answer [ ] 12(f) motion to strike [ ] [Rule 12(e) motion for more definite statement, if court orders a reply] [ ] [Reply, if ordered by the court] [ ]

Counterclaim [ ] Answer [ ] Rule 12 pre-answer motion [ ] Answer to the CClaim [ ] R. 12(f) motion to strike [ ] [Rule 12(e) motion, if court orders a reply] [] [Reply, if ordered] []

III.

Substantiality of Claims and Defenses A. Introduction Merits: 12(b)(6) is the only pre-trial motion that goes to merits 6|Page

Pleadings vs. proof o Trial goes beyond allegations and examines evidence of the issues. o Pre-trial motions address BOPle; trial motions address BOPro and BOPer. Burdens of production/persuasion: Judge and jury look to the evidence: o BOPro: Jury control device. Ensures party wont be allowed to prevail on an element for which it has burden unless reasonable jury could find for it. Pre-trial: summary judgment (SJ); based on affidavits Pre-verdict: judgment as a matter of law (JAMOL); formerly DV; vased on witnesses. Post-verdict: renewed judgment as a matter of law (RJAMOL); formerly JNOV. If BOPro is met, jury decides BoPer. o BOPer: If a party has met BOPro, jury has the final say.

B. Evidence Role of evidence in Civ Pro o Determining whether BOPro has been satisfied depends on evidence. o Key in summary judgment motions and motions for JAMOL. Rules of evidence o Main points Direct vs. indirect Hearsay and multiple hearsay Exam wont ask about admissibility under hearsay rules. Task is to see if type of hearsay allowed for summary judgment is the kind were dealing with. And if evidence is direct or indirect. Admissibility Evidence is introduced in 2 basic forms: Witness testimony Documents Personal knowledge (FRE 602) Witness must have personal knowledge of matter in testimony. Must have a foundation for that testimony. Authentication (FRE 901(a) and (b)(1)) Documents in evidence must be authenticated. Must support a finding that the matter in question is what its proponent says. Simplest way of authenticating: Testimony by a witness with knowledge, like the person who prepared it. Relevance (FRE 401) Testimony and documentary evidence are admissible only if relevant. Relevant testimony has some tendency to make what youre claiming more or less true. Dont assume that just because evidence is relevant, its admissible; much of evidence law is about exclusion of relevant evidence. 7|Page

If its relevant: Is it direct or indirect (circumstantial) evidence? o Direct: Eyewitness testimony about a fact in question o Indirect: Trier of fact has to infer a fact. Chains of inferences can be longer. But if theres direct evidence, its just a question of believing the witness. Jury doesnt have to credit direct evidence over indirect. Hearsay (FRE 801(c)) o May be relevant but not necessarily admissible. o Statement must be made at trial or at a hearing in order for it not to be hearsay. o Exceptions to the Hearsay Rule Over 20 exceptions listed in FRE 803, 804, 807, as well as in FRCP 56 (in SJ motion). Admissions of a party-opponent are not hearsay (FRE 801(d)(2)(A), (D)). Multiple hearsay (FRE 805): Hearsay within hearsay isnt excluded if each part conforms with an exception to the hearsay rule. Hearsay vs. personal knowledge: Dont confuse. Impeachment Casts doubt on credibility of testifying witness. May demonstrate that a witness is biased or otherwise cant be trusted. May also call a witness to contradict 1st witness. Jury determines who is more credible.

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C. Summary Judgment (Rule 56) Differentiate from summary adjudication o Summary adjudication: Resolves an issue less than the whole. (AKA motion for partial summary judgment.) o Summary judgment: Resolves everything. Moving party is entitled to SJ if a reasonable jury would be compelled to find for the moving party. (Not warranted if jury could find for either party.) Moving party is entitled to SJ if theres no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. o What is a genuine issue of material fact? Theres a genuine issue if a reasonable jury could find for either party. No genuine issue if a reasonable jury could find only for one. For P to win, all issues of material fact must be decided in Ps favor. D can win if either issue is decided in Ds favor. Very closely tied to question of who would have BOPro at trial. Whether theres a genuine issue of material fact on disputed elements of a claim can be determined only by looking at evidence introduced by the parties. 8|Page

When is a movant entitled to judgment as a matter of law? Occurs in most cases when there is no genuine issue of material fact. But there may be a dispute about the legal effect of those facts. In this situation, an SJ motion may be most economical vehicle for deciding a case. In negligence cases Sometimes neither party may be entitled to SJ even if there are no genuine issues of material fact. Reasonable jury could find for either party even on the undisputed facts. We often let jury decide whether theres been negligence, even if theres no disagreement between parties as to relevant facts.

SJ materials o Identified in Rule 56 Pleadings: Cant make issues genuine, but can determine what issues are material. SJ motions pierce the pleadings sees what actually is at issue in the case; what the parties actually contest and can prove. Discovery and disclosure materials Interrogatory devices (Rule 33) Requests for admission (Rule 36) Requests for documents (Rule 34) Depositions (Rule 30/31) o To subpoena a nonparty for deposition: Rule 45

Affidavits: Preferable to get an affidavit from a friendly party instead of taking deposition, which would make witness vulnerable to questions from other party. Rule 56 exceptions to the hearsay rule: Affidavit, interrogatory response, or deposition transcript may all be out-of-court statements. o 26(a)(1)(A)(i): Without awaiting a discovery request, party must provide to other parties information on each individual likely to have discoverable information, along with subjects of that information, that the disclosing party may use to supports its claims or defenses, unless the use would be solely for impeachment. SJ: When moving party has BOPro at trial o Conceptual framework Moving party must produce evidence that would compel a reasonable jury to find for the movant. Jury isnt compelled unless: Evidence, if believed, would require jury to find for that party And theres no basis for disbelieving the evidence o No basis for disbelieving testimony o Inferences drawn from indirect evidence could only support the partys case. If movant meets burden, BOPro shifts to opposing (nonmoving) party. Nonmoving party then has to come up with affirmative evidence that would let reasonable jury find for it. Exceedingly rare for BOPro to shift in this way. 9|Page

Movants indirect evidence often susceptible to other interpretations. o And theres often a basis for questioning witness credibility. Motion papers in opposition of SJ: Nonmoving party can: o Argue that movants evidence, even if believed, wouldnt compel a reasonable jury to find for the movant. Argue that theres a basis for jury to disbelieve the testimony. Produce evidence that would allow reasonable jury to find for it. Moving party can then reply to opposition papers. 15(a) only applies to pleadings, but courts typically allow parties to amend motions as well. Credibility: Nonmoving party without BOPro at trial can defeat SJ motion by raising a credibility issue about moving partys evidence. Credibility of evidence is a matter for the jury, not the judge. So when credibility is open to question, SJ is inappropriate. Question of biased testimony

Moving party w/ BOProT may rely on biased witness testimony if: Testimony is uncontradicted and otherwise unimpeached And nonmovant could easily rebut testimony but doesnt. Limits the notion that if theres a basis for disbelieving testimony, SJ should be denied to a moving party with BOProT. SJ: When moving party does not have the initial BOProT o Traditional approach: Negation Conceptual framework Nonmovant isnt required to show anything before trial unless movant submits affirmative evidence negating nonmovants claim or affirmative defense. So a D moving for SJ could force P to demonstrate that P could satisfy its BOProT only if D first produced evidence that, if believed, would compel a reasonable jury to find for D. Doesnt let D force P to put up or shut up. Motion papers in opposition of SJ: Nonmoving party could: Argue that movants evidence, if believed, wouldnt compel a reasonable jury to find for the movant. Produce evidence that would let a reasonable jury find for it. Adickes v. S.H. Kress & Co. Facts: White P is denied service because she ate with blacks; she leaves and is arrested for vagrancy. She files 42 U.S.C. 1983 claim, alleging conspiracy between D and local officials. Issue: D and police conspired to deny P equal protection rights. (P would have BOProT.) Ds showing on SJ motion 10 | P a g e

Deposition from store manager, affidavits from police, all saying there was no conspiracy. Court says this wasnt enough to negate Ps claim; presence of an officer in store would be enough to infer conspiracy. Ps showing: She got lucky. If D had satisfied BOPro on SJ, P would have been in serious trouble. Complaint asserted policemans presence, but pleadings arent evidence, just assertions; this wouldnt have helped P meet BOProT. Ps deposition statement that student saw officer is hearsay; should have gotten deposition/affidavit from the student. Store employees unsworn statement: Traded a hello greeting with an officer. o Today, probably would be treated as admission by partyopponent. But not at the time. o At time, it wasnt an admission, so its hearsay (because unsworn); would need deposition or affidavit. Ps affidavit denying situation in store was explosive: Casting doubt on store managers credibility not enough; P would need affirmative evidence. Affidavit wouldnt have satisfied Ps BOProT. P could have moved for continuance under 56(f) to get affidavits, depositions, other kinds of discovery. o Would have made admissible for SJ the evidence that didnt help her. o Courts have held that if evidence can be reduced to admissible form, continuance should be granted, even if no request has been made. Modern approach Celotex Corp. v. Catrett Facts: Catrett filed wrongful death suit alleging husband died from exposure to asbestos products. (P has BOProT.) Issue on Ds motion for SJ: Was Mr. Catrett ever exposed? o D says P produced no evidence that Mr. C was exposed. o Ps response: Mr. Cs deposition in a workmans comp proceeding (sometimes admissible under FRE 804(b)(1), but not this particular one). Letter from Hoff, potential witness Letter from insurer (hearsay) Procedural history: o Trial court granted SJ. Appellate court reversed, saying D hadnt negated Ps claim (relying on Adickes).

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Supreme Court reversed appellate court, emphatically rejected the view that a D has to negate Ps claim to make P show that she could satisfy BOProT. Decision only relevant in cases where movant doesnt have BOProT. o

The approach after Celotex Negation is sufficient but not necessary to satisfy the movants initial responsibility. Inquiry may be limited to whether nonmovant with the BOProT can satisfy its burden. Movants focus is on attacking evidence of nonmoving party with the BOProT. Justifications Language of Rule 56: Weak; it doesnt say affidavits required. Courts power to grant SJ sua sponte: Stronger; negation standard is inconsistent with this party. Proper role of SJ in notice pleading system: Most persuasive. But does assumption that motions to dismiss are fairly useless survive Twombly (which made them far more important)? Reconciling Adickes Court says Adickes would have been decided the same way under the Celotex standard, but doesnt explain why. How to make sense of this? It may be that even if Celotex standard were used in Adickes, SJ would have been denied and a 56(f) continuance granted to put in admissible form the evidence that would have satisfied her BOPro on SJ and at trial. So what is required to satisfy initial responsibility for SJ? Different ways of reading Celotex: o The accurate representation view: Moving party only has to make an accurate representation that theres no admissible evidence in the record that would permit reasonable jury to find for nonmoving party. Discovery not required. o The duty to investigate view (White/Brennan): Discovery required before a party can satisfy its initial responsibility. o Rehnquists majority opinion is arguably consistent with both. It may be that it requires identification of pleadings, depositions, motions, answers to interrogatories and admissions if they point to absence of a genuine issue of material fact. Whats the appropriate standard? o On the spectrum: Negation Duty to investigate Accurate representation put up or shut up 12 | P a g e

Which is better?

D. Possible approaches

From policy perspective: AR; focuses attention on whether party with BOProT can satisfy its burden. DI may distract from key issue by focusing on whether moving party conducted an adequate investigation; but it meshes with an intuition against requiring a nonmoving party to demonstrate before trial that it will be able to satisfy its burden at trial. Tactical considerations Regardless of Celotex, good lawyer wants to preview and shake other sides evidence. Take thorough discovery and negate the nonmoving partys claim even if you dont have to. Dont just do what is required under the law; make the most persuasive case possible. Celotex: The admissibility question and the will-call view It used to be clear that the nonmoving party, once put to its BOProT, must produce evidence admissible for purposes of defeating SJ. Since Celotex, many courts follow the will-call view o Will call: Nonmoving party can rely on inadmissible evidence if: Evidence would be reducible to admissible form at trial And nonmovant can persuade court that evidence will in fact be reduced to admissible evidence at trial. o But despite language in Celotex, its questionable whether court intended to relax evidentiary standard on an SJ motion. The two ambiguities in Celotex: E. Movants initial responsibility H. Accurate representation of the record K. Duty to investigate (White/Brennan) F. Quality of evidence that the nonmovant must submit I. Admissible evidence L. Will-call

G. Defense-oriented views J. Alternative approaches

Anderson v. Liberty Lobby Issue: Whats the relevance of the standard of proof on an SJ motion? Holding: Whether a genuine issue of material facts exists must be judged against the relevant standard of proof. Quantity and quality of evidence required to meet BOPro goes up as SOP rises. Paradox: Anderson says its up to the jury to make credibility determinations, weigh evidence, and draw legitimate inferences from facts. But how can court decide whether required quantum and quality of 13 | P a g e

evidence has been produced without actually weighing the evidence? It cant. o So court must mean that a judge should weigh evidence in the same way a jury would apply applicable standard of proof as to whether party has met BOPer. o Judge isnt a super-juror; appropriate question is whether it would be within the realm of rason for a jury to find for a party with the BOProT. Andersons real meaning: Relationship between direct and indirect evidence. o Direct is almost always sufficient to satisfy BOProT. But testimony may be ruled incredible as a matter of law (if contradicted by indisputable physical facts or law of nature). o Indirect: Andersons major impact

Says judges will decide what inferences are permitted, and jury will decide whether to draw those inferences. Seems to say that permissibility depends on the SOP; the higer the SOP, the more persuasive the chain of inferences must be. Strength of indirect evidence on a material issue of fact must be considered as whole to determine whether BOProT has been met. (On exam: Analyze!) Credibility and the BOProT Most courts agree that disbelief of the other sides witnesses usually isnt enough to satisfy a partys BOProT. Reeves v. Sanderson Plumbing (2000): Leaves open the possibility that the existence of a basis for concluding that a party testified dishonestly while insufficient in itself may help the opposing party satisfy its BOProT. o But Woolley is skeptical that courts will read this as having any effect on whats needed to satisfy the BOProT. On exam: Remember: o Its tempting to say that for a party with BOProT, if theres a conflict of evidence, its a credibility issue and SJ has to be denied. o Question of whether a nonmoving party can satisfy BOProT has nothing to do with credibility; its about whether theres direct evidence, or indirect evidence that is sufficiently persuasive. o Credibility does play a role when the party moving for SJ has the BOProT.

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The Jury Trial

I) The Right to a Jury Trial A. Introduction Jury trial hugely important in the American procedural system. In SJ: Availability of SJ is cabined by problems with taking issues away that a jury could decide either way. Dont confuse structural importance with frequency (jury trials are relatively rare). Its the effect of the jury on the system thats important. Availability of a jury trial and unpredictability of juries also has an impact on things like settlement value of a case. What is the jurys proper role? Involves: o Right to jury trial under the Constitution o Allocation of decision-making authority (between judge and jury) B. Juries and the 7th Amendment Overview o Two clauses: Right to jury in suits with amount in controversy (AIC) over $20. No re-examination of any fact tried by a jury. th o 7 Amendment hasnt been incorporated against the states. Applies only to federal courts. o Its been interpreted in light of English law existing in 1791. Two types of courts existed at the time: Common law courts legal remedies (money damages, usually restitution would be equitable) Courts of equity equitable remedies (injunctions) Curtis v. Loether o Issue: In a suit seeking damages on a statutory claim, is it a suit at common law within meaning of the 7th Amendment? Holding: Yes. Power of the jury o Civil juries not as powerful as criminal juries, but still a lot of sway. If facts are to be decided by a jury, court can do no more than instruct the jury as to the law and hope the jury obeys. If jury returns general verdict (the usual practice, but not in Texas), theres no way for court to even consider the jurys reasoning. Professor Moore: The general verdict, at times, achieves a triumph of justice over law. 15 | P a g e

Selecting the jury

Somewhat conflicting goals: Achieve a panel that Comprises a fair cross-section of community And is impartial

Two kinds of challenges to be exercises against jurors:

For cause: When a party can show juror is biased or in a category deemed to biased as a matter of law (wife of the D, for example) Peremptory: Any reason (other than race or sex) Understanding the 7th Amendment o Origins Founders viewed jury as protecting people against government abuses. But Framers provided that juries wouldnt act as a check in matters of equity (which had different rules of civil procedure) Federal courts and the FRCP Before the FRCP: Juries decided factual issues on law side; judges decided factual issues on equity side. Equitable cleanup doctrine: If equity suit was filed, incidental legal claims could be tried on the equity side to avoid separate suits. FRCP came into effect in 1938 the merger of law and equity. Established one set of rules for both legal and equitable suits. Beacon Theatres Inc. v. Westover Issue: Is a declaratory judgment a legal or equitable remedy? Facts: Fox pre-emptively sues Beacon seeking two things: Declaratory judgment that Fox wasnt violating antitrust law (equitable remedy) Injunction from litigation. Beacon filed counterclaim seeking damages (a legal remedy). Procedural history: District court ordered Foxs claims (which it saw as equitable) to be tried first to a judge, then Beacons counterclaim would be tried to a jury. Could have meant Beacon wouldnt have a chance because of principles of collateral estoppel. So Beacon sought writ of mandamus against Westover (judge) to change the order. 9th Circuit denied request. SC granted cert. Courts reasoning: Its an inverted lawsuit evaluating Foxs request for declaratory judgment requires a look at what kind of claim Beacon could have brought if Beacon had sued first. Because Beacon could have brought suit for damages first, the declaratory judgment in Foxs claim is legal, not equitable.

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Court rejects traditional approach, says it doesnt survive the merger of law and equity in 1938 (FRCP took effect). The merger shrinks the scope of equity. Preference for jury trial: When legal and equitable claims have facts in common, the right to a jury attaches to those fact issues. In practice: Normally, legal and equitable claims are heard at the same time. Jury decides common issues; judge handles remaining equitable issues.

Dairy Queen v. Wood Facts: Demand for a financial accounting between two parties (viewed as equitable issues too complex for jury). Courts holding: Theres an entitlement to a jury. Special master could be appointed to assist jury. No need to confine accounting to the court. Procedural innovations mean no need for equity to act. Makes clear that the Equitable Cleanup Doctrine is dead. Ross v. Bernhard Facts: Derivative suit by corporate shareholder. Common law didnt recognize right to sue on behalf of corporation; could only be done in equity. (Didnt matter if suit was for money damages; the issue was who actually sued the third party.) Courts holding: What matters after the merger of law in equity is the claim being asserted in the derivative suit. Derivative suit is just a procedural device to get into court. Nature of the procedural device no longer determines the form. Parklane Hosiery Co. v. Shore Facts: SEC sued Parklane seeking an injunction equitable claim, so judge made all findings. Then investors sued Parklane for money damages. Both suits involved same underlying facts. Parklane seeks to retry facts that had been resolved under equitable claim, saying collateral estoppel shouldnt apply. Issues: Does collateral estoppel apply when parties differ in next suit? Does the earlier equitable suit change need for jury determination of factual issues? Courts holding: Beacon rule (factual issues common to legal and equitable claims must be tried to a jury) applies only if the equitable and legal claims are brought in the same proceeding. Lytle v. Household Manufacturing Facts: P sued under 1981 (civil rights statute providing money damages remedy legal) and under Title VII (providing back-pay remedy equitable) Procedural history: District judge found that 1981 did not provide a legal remedy (he was wrong!), and essentially dismissed that claim; then used factual finding to enter judgment against P on Title VII claim. Issue: Should judges factual findings on Title VII claim be given collateral estoppel effect with respect to the 1981 claim? 17 | P a g e

Courts holding: If a judge erroneously denies a party a jury trial on the common issues, the party isnt bound by the judges findings. Beacon and state courts: Beacon rule is the minority approach in the states.

II)

Judge and Jury

A. Motions for Judgment as a Matter of Law vs SJ Standards o Essentially the same for JML and SJ. But theres a practical difference. Fact that you dont get SJ doesnt mean you cant get JML, even if evidence is identical. Latest revision to Rule 56(c) clarifies that SJ is within courts discretion; may be appropriate not to grant it even though the standard arguably has been met. The key distinction: SJ motions are on the papers; JML motions are based on the evidence at trial. In JML, dont have to worry about: Whether party with BoProT can meet its burden. Whether evidence will be admissible it either was or wasnt.

B. Post-verdict motions: Renewed JML and new trial motions Either motion has to be filed within 10 days of entry of judgment. RJML motion may be brought only if JML motion made pre-verdict. o Pros/cons Con: JML terminates trial, so jury is excused without a verdict. If appellate court concludes JML was improper, have to have a whole new trial. Pro: If its crystal clear that JML is proper, may save some time. New trial motions (NT): Broader scope than JML o NT based on errors/irregularities in trial process: Governed by Rule 61 (harmless error rule) o NT based on weight of the evidence. Less drastic than JML; you just have another jury weigh in. Standard in federal rules: No NT based on insufficient evidence unless verdict goes against great weight of the evidence. NT based on lack of evidentiary support for damages If court thinks damages were excessive, it can either reduce the amount (remittitur) or grant NT. Verdict winner can accept either. If damages were inadequate: Court can order NT. NT motions by verdict winner: Attacks things like errors or irregularities in the trial, not sufficiency of evidence. 18 | P a g e

Tanner v. United States and Rule 606(b) o Facts: Jurors getting drunk, high, etc. o FRE 606(b): Inquiry of validity of verdict or indictment: juror cant testify on: Any matter or statement occurring during deliberation Effect of anything on jurors mind/emotions as influencing assent/dissent. Anything concerning jurors mental processes. Exceptions: outside influence, newspaper articles, mistakes; and the rule doesnt apply to an inquiry before a verdict. Courts holding: Reads provisions broadly to exclude any evidence about anything that happened in the trial, once a verdict has been rendered. Courts policy considerations, and some critiques: Frankness in deliberations: How would it be affected by allowing testimony as to conduct during trial? Avoid harassment: But other ways to avoid this, like forbidding counsel from contacting jurors. Community trust: But hiding problems worse in the long run. Finality of verdicts: Does hold some water. Court focused on argument that drugs/alcohol arent outside influences under the meaning of 606(b) But this doesnt seem to be a reading required by text of 606(b). Question remains: Whats the basis for excluding the evidence? A defense of Rule 606(b) Doubtful that Tanner court properly weighed the matters. But thats not to say that 606(b) doesnt serve functions. Maintains privacy of juror deliberations; keeps jury independent Allows jury, within limits, to ignore courts instructions. Even if court learns of irregularities during deliberation or jury misconduct before verdict, court can order a new trial.

Choosing the Court and Law

I) Introduction A. Four Requirements for Bringing a Case in a Particular Court: Subject matter jurisdiction (SMJ): Courts power to hear a certain type of case Territorial/personal jurisdiction (TJ): Courts power to make a party appear. Venue: Provides more precise geographical location for suit than TJ Forum non conveniens (FNC): If federal court isnt best forum, then dismiss. B. Choice of law (federal or state), along with other considerations (convenience, characteristics of jury, etc.) may determine what course of action a lawyer will choose. II) Subject Matter Jurisdiction 19 | P a g e

A. Introduction: The Relationship Between Federal and State SMJ Every state has court of general jurisdiction that can hear federal or state claims. Federal courts have limited jurisdiction; can only hear cases where jurisdiction has been conferred by the Constitution and by statute. B. Federal SMJ Three bases: o General federal question jurisdiction (arising under jurisdiction) o Diversity jurisdiction o Supplemental jurisdiction Also consider when a case that could be brought in federal court is removed from state court to federal court.

C. General Federal Question Jurisdiction Introduction o Constitutional basis: Article III, 2 Authorizes Congress to grant jurisdiction to federal courts in types of cases identified in first paragraph of 2. Suit must arise under laws or treaties of the United States Osborn v. Bank of U.S.: Read broadly, stands for the proposition that a case arises under within meaning of 2 whenever a question of federal law might arise in the case. Statutory basis: 28 U.S.C. 1331 (narrower than constitutional basis) Grants original jurisdiction over all civil actions arising under the Constitution, laws or treaties of the U.S. Scope of arising under here is limited in two major ways: Fed. question must appear on face of a well-pleaded complaint. o Federal affirmative defense to a claim created by state law isnt a basis for satisfying the WPC rule. Even then, in a certain type of case its likely theres no statutory arising under jurisdiction Louisville & Nashville RR Co. v. Mottley Facts: Ps injured by RRs negligence. Compensation was free transportation for life (contractual). Later, a federal statute bans free rail passes, so RR refused to renew Ps pass. Ps seek specific performance. Railroad defends on federal issue. Ps won in circuit court. SC remanded because of lack of SMJ, and gave instructions to dismiss. Court itself raised the issue of SMJ. Case makes clear that if SMJ comes to courts attention, court must dismiss even if the issue wasnt raised by the parties or even on appeal, as here. No SMJ because Ps were anticipating a federal question defense.

20 | P a g e

SCs jurisdiction: 1257(a): SC has appellate jurisdiction whenever an issue of federal law might be dispositive of the case. Federal question jurisdiction over hybrid claims Federal law is incorporated into a state-created claim when: State law created the cause of action And liability under state law is determined by applying fed. law Relevant state law usually doesnt expressly refer to federal law. Hybrid claims vs. legislative plagiarism: A state supreme court is the final authority on meaning of legislation using same words as federal law. Federal question jurisdiction over declaratory judgment claims

In an inverted lawsuit: court will consider what Ds complaint would have looked like if P hadnt anticipated the suit. So no federal question jurisdiction in this sense unless Ds case (as a potential P) would have contained a federal question. Removal based on a federal question o Introduction: 1441(a), (b), 1446(a), (b), (d): Actions removable generally Removal OK if case could have been brought under 1331. All Ds have to consent to removal. ( 1441(a)) Notice of removal must be filed within 30 days after D has received service of summons. ( 1446(b)) Notice must contain short and plain statement of grounds for removal ( 1446(a)). If right papers are filed in fed./state court, state court is stripped of jurisdiction ( 1446(d)) Well-pleaded complaint rule and the complete pre-emption doctrine WPC applies to removal; P usually can determine where suit is triable based on whether claim relies solely on state law ground. Complete pre-emption doctrine is an exception to WPC. Pre-emption: Federal law supersedes state law. State law is completely pre-empted only when Congress creates an exclusive federal remedy that displaces state law. Distinguish from exclusive jurisdiction: If D fails to remove in a situation of complete pre-emption, but theres no exclusive jurisdiction, a state court can adjudicate the claim using federal law.

D. Diversity Jurisdiction (DJ) and Removal Based on DJ Ordinary Litigation [Art. III 2, 28 U.S.C. 1332(a)(1)-(3), 1332(c), 1441(b); Rule 21] Need complete diversity on both sides of the v. (Strawbridge) Mas v. Perry o Facts: Ps (husband = citizen of France; wife = citizen of MS) sue landlord D (citizen of LA). o D raises objection to DJ. 5th Circuit analyzes Ps statuses separately:

21 | P a g e

Husband: OK under 1332(a)(2): Jurisdiction between citizens of a state and citizens of a foreign state. (Today, husband would be deemed a citizen of LA; Congress amended the statute.) Wife: OK under 1332(a)(1): Jurisdiction between citizens of different states. o Would make more sense to analyze under 1332(a)(3): Jurisdiction between citizens of different states and in which citizens of a foreign state are additional parties. But: If landlord was a citizen of France: Still OK under (a)(3). Complete diversity required only between citizens of U.S. states. DJ and Rule 21: Court can drop a nondiverse party instead of dismissing the entire claim. The amount-in-controversy requirement o Under 1332(a)(2): AIC minimum = $75,000 Has been read to require claims of each P against each D meet the AIC requirement.

Aggregation rules All claims against a party can be aggregated to satisfy AIC requirement. (Woolley: A ridiculous fork in the law.) Example: A sues B for $50K contract claim and $30K tort claim. AIC requirement is satisfied. The legal certainty test In Mas: D couldnt show to a legal certainty that either husband or wife would be unable to recover more than AIC minimum on their claim. So AIC was satisfied. Court will credit P in good faith. Test easily satisfied when amount is capped under AIC minimum.

Removal o Mases removed under 1332. If Ps had filed in state court, could D remove? No. 1441(b): D is a citizen of state where suit was filed. o 1446: One-year deadline for removal in a diversity case if initial pleading wasnt removable. Citizenship of artificial entities o Person = citizen of state where domiciled o Corporation = citizen both of state where its incorporated and state where it has its principal place of business. o Unincorporated entities = citizen of all states where members are citizens. DJ and removal in class-action litigation o Normally Only named Ps had to be completely diverse from Ds (Supreme Tribe of Ben-Hur v. Cauble). But each member of the class had to satisfy AIC requirement (Zahn v. International Paper). The Class Action Fairness Act ( 1332(d), 1453) of 2005 Provides alternative basis for DJ over class suits. 22 | P a g e

1332(d) authorizes two major changes: DJ is OK if: o Theres minimal diversity instead of complete diversity (only one class member has to be diverse from one D) o Individual claims of less than $75K are OK as long as the aggregate sum exceeds $5M. But you have to have more than 100 class members to take advantage of 1332(d). And 1453 makes it easier to remove suits in three ways: 1-year limitation in 1446(b) doesnt apply No requirement for citizenship of Ds in state where suit brought Consent of all Ds for removal not required.

E. Supplemental Jurisdiction 1367 Introduction o Court can assert jurisdiction over a claim thats closely linked to a claim over which it has FQJ or DJ. o In 1990, Congress passed statute codifying SuppJ: 1367. United Mine Workers v. Gibbs o Facts: P (Gibbs) filed two claims one based on Labor Management Relations Act, the other on TN common law. o Issue: Can federal court exercise SuppJ over the state common law claim? DJ not possible because some members of UMW (unincorporated group) were from TN, as was P. So case would have to fall under FQJ. Holding: Court can act if theres FQJ and a common nucleus of operative fact with the state claim. Constitutional power Supplemental claim must be part of same case or controversy over which court already has jurisdiction. Osborn said theres jurisdiction if theres a federal ingredient. The freestanding claim test Can be no SuppJ in absence of a freestanding claim with arising under or diversity jurisdiction. Federal claim has sufficient substance if its not frivolous an attempt to get out of state court and into federal court. Substance requirement doesnt apply if diversity is the basis. Common nucleus of operative fact Test is satisfied when theres substantial overlap among the federal and state claims. 23 | P a g e

o o

o o o

But overlap isnt required; the trend is toward requiring a logical relationship. The logical relationship test: Do fairness and considerations of convenience and judicial economy indicate that it makes sense to try claims together? Statutory basis for SuppJ: Before 1990, courts generally inferred authority from 1331 and 1332. Discretion

Two-part inquiry: Judicial power and judicial discretion. Gibbs court insists courts have discretion not to exercise SuppJ. Ask: Even if claims are sufficiently related as part of one constitutional case, are there other considerations that would warrant not exercising jurisdiction over the state-law claims? Factors for a court to consider: 1367(c) Owen Equipment & Erection Co. v. Kroger o Facts: Kroger (citizen of Iowa) sued OPPD (of Nebraska) over fatal electrocution. OPPD impleaded Owen as a third party. Kroger amended complaint to add Owen. o Procedural history: Krogers claim against OPPD is dismissed; Ks claim against Owen proceeds. But its discovered that Owen is a citizen both of Nebraska and Iowa destroying DJ. o Issue: Is there SuppJ, since K waited to implead Owen until OPPD had? K in a difficult position; may have to re-litigate issues in state court. But Iowa SOL may have expired while K was in federal court. Majoritys analysis Ps cant avoid requirement of complete diversity (since no FQJ). P had a chance to have all claims heard in state court. Dismissal of Ks claim against OPPD didnt provide an alternative basis for the holding. Power to exercise SuppJ didnt disappear, but Gibbs tells us that if federal claims are dismissed, the claim that gave an independent basis for SMJ has disappeared, and the court should exercise discretion and not hear the state claim. Context rationale Court says context didnt justify SuppJ over Krogers claim. But if Owen filed claim against Kroger: That claim would be procedurally proper under Rule 14, and jurisdictionally proper for SuppJ purposes because Owen should be able to resolve all its rights arising from the incident in one lawsuit. Suggests that context rationale will always be available to a D. If Kroger had a compulsory counterclaim against Owen: K could have brought entire suit in state court. But she didnt choose to have Owen file claim against her in federal court. So in this situation, SuppJ appropriate over the counterclaim. But: Dont have to read the case as authorizing such a claim. Two readings of Kroger: Claims by Ps 24 | P a g e

Discussion of context just provides justification for treating Ds and other parties different from Ps for purposes of SuppJ. Or maybe court wasnt thinking about a reactive suit by Kroger against Owen; it was thinking about Kroger vs. OPPD. The SuppJ statute 28 U.S.C. 1367 o Subdivision (a): Gives federal courts power of SuppJ within limits of the Constitution, except as provided in (b) or (c) or another federal statute, provided the court has original jurisdiction over a civil action. Essentially, theres SuppJ over any other claims part of the same constitutional case. Also applies if court has DJ diversity suit is a civil action. Subdivision (b):

Limits only SuppJ over claims by Ps and persons proposed to be joined as Ps. The text: In any civil action of which the district courts have original jurisdiction founded solely on 1332 of this title, the district courts shall not have supplemental jurisdiction under subsection (a): over claims by plaintiffs against persons made parties under Rule 14, 19, 20, or 24 of the Federal Rules of Civil Procedure, or over claims by persons proposed to be joined as plaintiffs under Rule 19 of such rules, or seeking to intervene as plaintiffs under Rule 24 of such rules, when exercising supplemental jurisdiction over such claims would be inconsistent with the jurisdictional requirements of section 1332. The meaning of civil action under 1332 o Under 1331 (FQJ), its clear. More difficult under 1332 (DJ). Two possible ways of understanding it: The single claim approach Are diversity and AIC requirements met for at least one claim? If so, court may exercise SuppJ over other claims in the suit if authorized by law to do so. So complete diversity and AIC requirements are really limits imposed by 1332 on SuppJ. Its 1367(b) that enforces them. The whole complaint approach Complete diversity and AIC are required across the board. In this approach, you never get to 1367(b) in Kroger because of the lack of complete diversity. Huge consequences in the differences between the approaches Under whole complaint approach, 1367(b) is a lot less important. That matters because there are gaps in 1367(b), which was sloppily drafted. Single claim approach gives 1367(b) heightened significance. Gaps in 1367(b) Gap in Rule 20 (permissive joinder): 25 | P a g e

Two Ps join in one suit against one D. One P meets diversity and AIC requirements; other doesnt. Under whole complaint approach: No SuppJ because diversity and AIC requirements arent met by all Ps. Under single claim approach: No bar by 1367, so theres DJ over first Ps claim and SuppJ over second Ps claim. o One P sues two Ds in the same suit. P is diverse from one D and that claim satisfies AIC, but P is not diverse from other D and that claim doesnt satisfy AIC. Under whole complaint approach: Clearly no SuppJ. Under single claim approach: No SuppJ, because theres a D joined under Rule 20 conflicts with 1367(b). Gap in Rule 23 (class actions): o Named P sues single D on behalf of absent class members. Aggregate AIC is less than $5M. Named P has a claim for more than $75K, but none of the absent class members does. Since AIC is less than $5M, Ps main hope is 1332(a). Under whole complaint approach: No SuppJ. Theres diversity, but every class member has to meet AIC requirement. So no original jurisdiction under 1332(a). Under single claim approach: Named P meets diversity and AIC requirements. Class members are part of same constitutional case. So there will be SuppJ unless theres a bar by 1367(b); but thats no problem, since its claims by class members against a single D, not against persons made parties under Rules 14, 19, 20 or 24. o 1367(b) doesnt mention Rule 23 at all. But note that the gap is limited to single Ds; if there were multiple Ds, 1367(b) would apply. Allapattah v. Exxon Mobil o Facts: two suits: o Exxon: All named Ps in class diverse, but not all satisfy AIC. Star-Kist: Girls claim satisfies AIC, but familys claim doesnt. Issue: Is there jurisdiction even though AIC requirement from 1332(a) isnt satisfied? Courts holding: Yes SC uses single claim approach toward AIC requirement Uses whole complaint approach toward diversity requirement Reasoning: Dismissal of legislative history Court argues (incredibly) that 1367(b) isnt ambiguous, but says congressional intent is unclear. Woolley: Best reading of intent suggests that Congress didnt intend to change the complete diversity or AIC requirements. It certainly didnt want to create any 26 | P a g e

o o

single-D gaps. So the whole complaint approach is much closer to what Congress actually intended. SuppJ and removal o 1441 (removal statute) has been read to require removal of entire cases. So there has to be jurisdiction over every claim in the state court action before that action/case can be removed. o If P doesnt file to remand, court should remand sua sponte. o If complete diversity is lacking in state court and theres not another reason for removal (i.e., FQJ), you cant remove. o If theres complete diversity and AIC requirement is met in at least one claim, theres SuppJ unless barred by 1367(b). o Because FRCP dont apply to state courts, 1367(b) shouldnt bar any claim asserted while in state court. But claims asserted after removal are subject to limitations of 1367(b).

III)

Territorial Jurisdiction and Choice of Law A. Introduction: TJ SMJ is about authority to hear certain kinds of cases. Territorial jurisdiction (TJ) involves authority to adjudicate the rights of person, including the rights of a person in a thing. B. TJ in the Federal CourtsRule 4(k)(1)(A) Serving a summons or filing a waiver of service establishes TJ over a D who is subject to the jurisdiction in the state where the district court is located. Federal courts have same TJ as the states that have general SMJ. Two-step inquiry under the rule: o Does state law authorize the exercise of TJ? o Would assertion of TJ by a state court be consistent with 14th Amendments Due Process Clause? (If answer to both is yes, TJ is OK under Rule 4(k)(1)(A).) C. Pennoyer v. Neff Facts: Involves 2 separate suits o Mitchell v. Neff: Mitchell sued for attorneys fees and won a default judgment; Neff never showed up. Ns land was auctioned off; proceeds go first to satisfy Ns debt to M, then the rest of land goes to M. M sells land to Pennoyer. N sues in federal court. o N v. P 27 | P a g e

P defends, saying he had a sheriffs deed obtained as result of judgment in M v. N. N says deed was improperly obtained because there was improper service of the first suit and state court lacked power to render a binding judgment against N. This is a collateral attack on the first judgment judgment in the first suit is contested in a separate suit instead of an appeal. Collateral attack: the basics (Art. IV, 1; 28 U.S.C. 1738) o Generally not permitted; usually have to appeal, not bring a second action. Exception: Party who didnt appear can attack if court didnt have TJ. Appearance = participation (i.e., filing a motion to dismiss for lack of TJ) o Its risky: If you take a default judgment but are wrong about whether court had TJ, you give up the right to defend on the merits. But if you dont know about the first action, you have no choice but to mount a collateral attack. The Pennoyer Theory of Jurisdiction o Court applies two principles of 19th-century public international law: Each state has jurisdiction over persons and property within it. State cant exercise jurisdiction over a nonresident outside the state. Presence is the key element. Types of jurisdiction In personam: Jurisdiction over the body of the person. Two ways to accomplish it: o Service of process on an individual within the state o If D happens to be in state = transient jurisdiction Consent (including a voluntary appearance)

Agreeing to have disputes litigated in a certain forum Arranging to have a lawyer in the state appear on behalf If D appears without properly asserting a personal jurisdiction defense, theres a problem. Quasi in rem: Courts authority to render judgment up to the value of Ds property within courts power. o Cant assert it unless property has been attached (legally seized) at the outset of the litigation. o D can make a limited appearance to defend property. o Attachment has due process limitations.

Pennoyers exceptions to its theory of jurisdiction Cases affecting the personal status of resident Ps (i.e., divorce) Out-of-state corporations can be required to appoint an agent for service of process (responds to an important jurisdictional problem) Achievement of Pennoyer o Brings principles of international law into the Due Process Clause A judgment obtained in violation of these principles wasnt entitled to full faith and credit outside the state, but also not within the state as a matter of due process. 28 | P a g e

State could exercise jurisdiction within its borders as it saw fit; only limitation is when you had to go out of state to enforce it. Much of the case has been overruled, but it embedded TJ in the DP Clause.

Defects of Pennoyer o Problems applying the basic principle increased over time (i.e., out-of-state motorists; early statutes required consent to TJ). o Fatal flaw: With corporations, relying on consent and presence. Its not really consent if a corporation merely does business in state. And its not clear that the state has the power to prevent out-of-state corporations from doing business within the state.

D. International Shoe v. Washington Intro: o Narrow view: IS v. W merely handles the fact that Pennoyers requirements of consent and presence dont work well when evaluating corporations. Provides an additional basis for TJ: minimum contacts o Broader view: It redefines thrust of the DP clause from presence to fairness. Fairness isnt always present if you use TJ on basis of presence within a state (i.e., person served with process on airplane). Facts: International Shoe, headquartered in St. Louis, has a few salesman in Washington state. IS didnt pay into WA employment fund and was sued. IS argues its activities werent enough to manifest presence in WA. Holding: SC finds that there was TJ. o Due process requires only substantial justice. o Whats at stake: Whether the suit offends traditional notions of fair play and substantial justice. Shaffer v. Heitner broader view. Said all assertions of state court jurisdiction must be evaluated according to standards set forth by International Shoe and its progeny. Presence of property, by itself, doesnt allow TJ. o Two levels of analysis: Statutory prong (maybe, but not often, common law) Constitutional prong Presence (Pennoyer) vs. minimum contacts (IS)

Presence: Makes no difference whether the cause of action has any relationship to the state at all. Minimum contacts: States lack of connection to a claim may be fatal to an MC analysis. o One reading of Shaffer: If you have MC, you satisfy constitutional prong. Then the reach of the long-arm statute matters less. Burnham v. Superior Court o SC unanimously affirmed constitutionality of transient (tag) jurisdiction. o Court holds that service of process on individual within state is sufficient to grant state general jurisdiction over the individual. 29 | P a g e

Scalia opinion (4 justices) = traditional view Transient jurisdiction OK because it was accepted at time of the 14th Amendment. Contacts are only one basis for territorial jurisdiction. Brennan opinion (4 justices) = service of process is sufficient, but fairness is key. Transient jurisdiction consistent with fairness and concepts underlining the minimum contacts test. Might be open to strike down worst examples of exercising transient jurisdiction (i.e., on plane). Stevens agrees with both.

Summary: The law today: Seizure of property usually doesnt satisfy the territorial prong of jurisdiction; transient jurisdiction is a sufficient basis for exercising territorial jurisdiction.

E. Minimum ContactsA Framework for Analysis Two key questions: o What contacts count? Only Ds purposeful contacts. o Do the contacts that count justify TJ? Whether DP is satisfied depends on quality and nature of activity. Kulko: The test isnt mechanical; facts of each case must be weighed to determine whether the requisite affiliating circumstances are present. Few answers are black and white; the greys are dominant and even among them the shades will be innumerable. General jurisdiction (GJ) o Intro GJ = TJ over the D that doesnt depend on whether Ds claim has a relationship to the forum. Pre-International Shoe: All jurisdiction was GJ, theoretically. (If persons or property were within state, state could authorize TJ.) Shoe complicates matters says jurisdiction sometimes may depend on connection of the claim to the forum state. GJ in a minimum contacts analysis Points of agreement: Who has GJ? State in which individual is domiciled. States in which corporation has principal places of business. Harder questions: Less pervasive connections with forum Do corporations with less substantial continuous and systematic contacts qualify for jurisdiction? o Likely depends on fairness generally requires a relationship between clami and forum o How pervasive or significant are the contacts?

Case law is all over the place, but courts increasingly lower the bar for the exercise of GJ. Special jurisdiction (SpecJ) o Intro 30 | P a g e

SpecJ = requisite relationship exists between the D, the forum and the cause of action. But theres disagreement over what kind of relationship is required. The substantive relevance test strictest test for SpecJ Requires that the Ds purposeful contacts with the forum be substantively relevant to the dispute. If so, do the relevant contacts justify assertion of jurisdiction with respect to the claim being asserted by the P? Generally, if the test is satisfied, theres SpecJ. Problem is that the SR test may be underinclusive. May be no substantive relevance in a case, but state may have a legitimate interest in providing a forum for those injured as a result of something else within the state. The but for test Is there a but for relationship between cause of action and forum? Can be overinclusive. The mere fact that theres a but-for relationship isnt enough to justify SpecJ; necessary, not sufficient. Focus on whether the nature and quality justify assertion of TJ (a judgment call). A Jurisdictional Sliding Scale

Why must TJ be specific or general? Maybe court should be able to weigh related and unrelated contacts that D has with forum. As quantity and quality of Ds contacts increase, you could allow a weaker connection between Ps claim and those contacts, and vice versa. Camelback: Rare case to specifically endorse sliding scale. SC hasnt weighed in. Woolley: Cases dont need to be read as imposing a rigid dichotomy on specific and general jurisdiction. World-Wide Volkswagen v. Woodson o Facts: Family bought car in NY; while moving to AZ, theres an accident in OK, and fire causes severe injuries. Family alleges product defect and sues: Audi (manufacturer) Volkswagen of America (national distributor) World-Wide Volkswagen (regional distributor NY, NJ, CT) Seaway (dealership in NY) o Family members are NY citizens; they want WWV and Seaway in the suit to destroy complete diversity and keep suit in OK court, to prevent removal. o 2 questions: Does state law allow exercise of TJ? Would exercise of TJ here violate the 14th Amendments Due Process clause? Case was removed to federal court and Ds prevailed. But theres no way Ds strategy would work today. Currently, under 1446(b), case may not be removed on basis of 1332 jurisdiction more than 1 year after commencement of the action. Key issues: Purposeful contacts and purposeful availment 31 | P a g e

Ps argued purposeful contacts it was foreseeable that car sold in NY might cause injury. (SC: Foreseeability isnt enough.) Court requires purposeful availment focus is on whether the D purposefully availed itself of the privilege of conducting activities within the forum state, so that it has clear notice that its subject to suit there. (SC: No contacts that count between Ds and OK.) Other theories

A reasonable anticipation test? Courts sometimes focus on whether Ds conduct and connection to a state should make him reasonably anticipate being haled into court there. But this doesnt do much work. Purposeful availment is the test. Stream of commerce theory Provides just one basis for concluding that a D established purposeful contacts of such a nature and quality as to justify the exercise of TJ. Relevant only if a D delivers goods into a state through a chain of distribution. Court seems to endorse this theory, but it doesnt do enough to justify TJ in this case. Need purposeful availment. Similarity test for courts sympathetic to the but for test Another way of finding specific jurisdiction. If Ps claim easily could have arisen out of Ds contacts in a state, D has to defend there. But fairness notion needs to do a lot of work to prevent ridiculous claims. Example: Audi and Volkswagen of America sell cars in OK. Even though Ps car was sold in NY, its likely that Audi and Volkswagen should be prepared to defend a product-liability case in OK. o Could work if Audi and Volkswagen of America had objected to TJ; but they didnt. o If they had: Stream of commerce theory helps establish purposeful contacts. But is there the right relationship for specific jurisdiction? Substantive relevance: No, since car was sold in NY and wasnt manufactured or designed in OK. But-for: No, since none of Ds actions in OK could be viewed as a but-for cause of the accident. Helps solve problem of underinclusiveness. Can solve problem of the but for tests overinclusiveness by asking the second question in contacts analysis: Whether relevant contacts justify assertion of jurisdiction over the D with respect to the claim. Asahi Metal v. Superior Court o Facts: Tire explosion causes motorcycle accident. Cyclist sues tire-tube maker Cheng Shin (from Taiwan), which brings valve-maker Asahi (from Japan) into the case, seeking indemnification. Cyclist settles with Cheng Shin; only claim left is Cheng Shin v. Asahi. o Issues: 32 | P a g e

Were there purposeful contacts? Was there purposeful availment? Long-arm statutes: allow state jurisdiction over persons not served in state. Three types: Specifically authorizing jurisdiction to the full limits of the Constitution (CA) Drafted and interpreted more narrowly than Constitution (NY) Drafted more narrowly, but interpreted to permit jurisdiction when thats constitutional (TX). The stream of commerce issue CA sought to exercise jurisdiction over Asahi based on delivery of valves to CA by stream of commerce. OConnor 4: Placing item in the stream isnt enough to show purposeful availment. Must be additional conduct showing purpose or intent to serve the market in the forum state. Brennan 4: When a D benefits, placing goods into the stream with awareness that goods would end up in forum state is enough to to establish purposeful minimum contacts with the forum. Stevens: Rejects OConnors firm line between mere awareness and purposeful availment. Existence of purposeful availment is affected by volume/value/hazardous nature of the component. Relevance of Asahi the minimum contacts prong Not limited to stream of commerce cases. Is OConnor right that serving a market isnt enough to establish purposeful availment? Or is Brennan right that awareness is sufficient when there are systematic and continuous contacts from which D derives a benefit? Asahithe reasonableness prong Justices split 4-4-1 over minimum contacts prong. But it was 8-1 on reasonableness prong that it was unreasonable for CA to exercise jurisdiction over Cheng Shins action against Asahi. Purposeful availment requirement protects individuals, not states, from exercise of power by states that lack an appropriate connection. Appropriate connection is distinct from convenience. The state suit is filed in matters because of choice-of-law rules. Reasonableness prong asks whether the assertion of TJ would comport with fair play and substantial justice, which requires a balancing test. Development of reasonableness factors hinted at in World-Wide Volkswagen: Burden of defending in the forum VS: Forums interest in adjudicating the dispute Ps interest in obtaining convenient and effective relief Interstate judicial systems interest in obtaining the most efficient resolution of the controversy. Shared interest of the several states in furthering substantive social policies. 33 | P a g e

Application of the reasonableness prong Focus is on whether the inconvenience or burden of defending in the forum is so disproportionate in light of the other interests at stake that the Ds due process rights would be violated if the forum asserts jurisdiction. Court in Burger King v. Rudzewicz indicated that its very difficult to defeat jurisdiction under this prong and that a D should rarely be able to do so. If P is able to satisfy the minimum contacts prong, the burden shifts to the D to demonstrate that jurisdiction would be unreasonable. The two tests are separate. Just because the minimum contacts test is satisfied doesnt mean the reasonable test will be satisfied. General jurisdiction and the reasonableness prong By definition, if GJ is appropriate (because D has contacts so substantial with the state), there cant be a question of whether the forum is seriously inconvenient to the D. If courts threshold for GJ is very low, maybe the reasonableness prong cures some of the damage. But if you apply the reasonableness prong to GJ cases, youve essentially abolished GJ, which doesnt depend on circumstances of the case.

The effects test o D need not act within a state to be subject to TJ there; causing an effect within the state may subject him to TJ, but thats not enough by itself. o D who has caused effects is usually subject to TJ in that state only if D has purposefully availed itself of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of its laws. (Calder v. Jones; but Calder court recognized exception to the rule that benefit is required.) o Calder v. Jones Suggests that a D who allegedly commits an intentional tort might be subject to jurisdiction if he or she knew the P would be seriously affected in the forum. Effects test applied here focuses on whether D has purposefully caused effects in the state.

F. Choice of Law Phillips Petroleum v. Shutts o Facts: Dispute over whether gas royalty owners are entitled to interest on suspended payments for their royalties. Named Ps sued on behalf of a large class in KS court. Typical claim is only $100 (a negative value class suit) o D objects to TJ over absent class members absent Ps (unusual). D argues that court lacked minimum contacts with many of the Ps and that out-of-state Ps had to affirmatively consent. o Courts analysis Did KS have TJ? Minimum contacts: Enough 34 | P a g e

Consent: Failure to opt out is OK, as long as absent class members had adequate representation. Class Ps are in a different position from Ds; theyre not at the same kind of risk. So court says there was TJ. Choice of law: Could KS apply its law to all claims in this suit? Two-part analysis: o Is there a conflict with law of another state? o If so, does the forum state have a significant contact or aggregation of contacts creating state interests such that choice of its law is neither arbitrary nor unfair? Court says there might be and remands. Distinguish choice of law from minimum contacts. Tests have a lot in common, but focus is different: For MC: purposeful availment For COL: state interests Allstate Insurance Co. v. Hague o Facts: Man killed in motorcycle accident in WI with 3 Ds. P files suit in MN, where stacking of insurance coverage was allowed. o Issue: Can MN apply its law, even though nearly all contacts are with WI? o Courts holding: Yes. Three factors, put together, were sufficient to justify application of MN law: Man worked in MN Widow moved there for unrelated reasons D does business in MN o Case makes clear how much latitude a state has to apply its own law to a controversy under the choice-of-law standard seen in Shutts. Sun Oil Co. v. WortmanThe False Conflict Stage o Facts: Involved same issue as Shutts, but with a different D. o Procedural history: KS court essentially concluded that theres a false conflict between KS law on interest rates and other states laws though there probably were real conflicts. o Courts holding: Affirmed KS court. Says a misconstruction is OK unless: It contradicts a law of the other state that is clearly established And has been brought to the courts attention by the party seeking application of the other law. Also says that a forum can apply its own longer statute of limitations to a claim even if it doesnt have sufficient connection to the claim to justify application of its own law. So on issue of SOL, significant contacts arent required. The Constitution and choice-of-law rules o Sun Oil dealt only with SOL, but it suggests a state can apply its own law to any matter viewed as procedural when Constitution came into force (as SOL were.) 35 | P a g e

o o

So Sun Oil says that the significant contacts test applies only to matters of substantive law. Vindicates Stevens view in Shutts. Bottom line: Court has interpreted Constitution to allow states enormous latitude in choice of law; states just cant run afoul of the Constitution.

IV)

The Erie Problem A. Introduction Both federal and state courts apply federal and state law. Erie Problem is about when a federal court may apply federal law even though a state court would apply state law. Erie is about vertical choice of law state or federal (as opposed to horizontal choosing between law of different states). Not rooted in the Constitution; its a policy of restraint. B. Erie Railroad Co. v. Tompkins Intro o Involved an interpretation of the Rules of Decision Act (28 U.S.C. 1652). o Issue is how to interpret laws of the several States. In doing so, court overrules Swift v. Tyson. o At time of Swift v. Tyson, law had three parts: General law: Principles in common among states and nations State courts werent bound by federal decisions about what general law required, and vice versa. State (local) law: Could displace general law by passing something inconsistent with the general law. Federal law: Binding on everyone, when it applies.

Swift v. Tyson o Interpreted reference to laws of several States in the RDA to refer to state/local law. o Since general law was distinct, Swift read the RDA to let federal courts apply their own version of general law instead of states. Erie o Facts/procedural history P files negligence suit. D argued that P couldnt recover because P was trespassing (an interpretation of Pennsylvania law). P files in NY in hope that court will apply its version of general law over PAs pro-D law. Trial court ruled for P; appeals court affirmed. Holding: Court reverses. No more general law; federal courts must use state statutes and common law. Collapses into two categories state and federal law. Matters of general law, for the most part, become matters of state law.

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Significantly limited authority of federal courts by expanding the domain of state law, and bound federal courts to the decisions of a states highest court on matters of state law. Federal general common law vs. federal common law FGCL Dead and buried. Refers to federal courts application of principles that have force of law separate from a particular sovereign. FCL Alive and well. Judge-made law that addresses matters of special fed. concern. Derives authority from the U.S; binding in both state and federal court under the Supremacy Clause. If FCL falls within 1331 (statutory arising under jurisdiction FQJ stattue), it may be jurisdiction-conferring. Courts reasoning Swift misinterpreted the RDA: Court almost certainly wrong here. Practical considerations Genesis of the Erie Policy Swift led to lack of uniformity between fed and state courts. Forum-shopping caused by Swift rendered impossible equal protection of laws. [Not 14th Am. EPC that applies to states] Constitutional aspect Federal government is one of limited powers, and nothing gives Congress or courts right to impose a rule applicable only in federal court. Congress clearly had power to legislate on issue, but it didnt. Its not clear that federal courts, without authorization from Congress, can announce a rule of FCL. But it is clear that federal court cant constitutionally apply a rule of FGCL, binding in federal but not state courts. Critiquing the constitutional reasoning Theres little to no criticism of Erie. But theres Art. III, 2: Why doesnt reference to judicial power there include right to decide what common law should be in diversity cases? Theres support for the view that 18th-century Americans had a concept of general law that extended beyond boundaries of any single sovereign. So maybe Article III was meant to protect out-of-staters from idiosyncratic interpretations of the common law by state courts and maybe Swift was correct.

C. Guaranty Trust Co. v. York Issue: Where federal courts have equitable jurisdiction, should they be required to apply a state SOL? (Is this the type of case governed by Erie?) Courts holding: Yes Analysis: 37 | P a g e

o o

Federal courts arent bound by Erie with respect to procedure. But how do you determine whether something is substance or procedure? The outcome determination test: If difference between federal and state law would be outcome-determinative, the issue is substantive. If not, its procedural. Asks: Would it significantly affect the result of litigation for federal court to ignore a state law that would be controlling in an action on the same claim by the same parties in a state court? Scope of the test is very broad.

D. Byrd v. Blue Ridge Rural Electric Cooperative Facts/issue: South Carolina law let a judge decide definition of employee within meaning of workers comp statute. Federal law let a jury decide. Which one should decide here? Holding: Byrd was entitled to a jury determination of whether hes employee. Is the choice of decision-maker outcome determinative? o Court suggests it isnt; no certainty that a different result would follow. Distinguish issue here (who should the decision-maker be?) from issue in York (would a legal rule compel a particular result?). But in rest of opinion, court assumes choice is determinative. Hmm. o What makes this case important: Court treats outcome determination as just one part of the process; its not absolute. The Byrd Balancing Test: a two-step analysis: o Is the choice between federal and state law outcome-determinative? If no, Erie doesnt require state rule to be applied. If yes, then the federal interest in uniformity of outcome must be weighed against the federal interest in applying the federal rule at stake. Court assumes OD test would be satisfied, then weighs federal interest in uniformity of outcome (Erie) against federal interest in applying its jury rule (letting a jury decide the case). Problem with the balancing test: How much weight to give these federal interests. Court gives no guidance.

E. Hanna v. Plumer Facts: OH citizen sued MA citizen in MA. Ps lawyer served D in compliance with federal rule, but not state rule (which required in-hand service). Court grants SJ for D, saying state law governed. o Notice: Ps lawyer could have prevented problem by serving in compliance with state and federal rules. May have been malpractice. Holding: Supreme Court reversed, saying theres a direct collision between Rule 4(d)(1) and state law. (Because the rule is valid under the Rules Enabling Act, it applies.) Importance of the case: o Makes clear the constitutional breadth of federal power over procedure in federal courts. The outcome determination test isnt constitutionally required; its not a talisman. o Seeks to help draw a line between substantial differences in outcome that matter and those that dont. (The problem with York) 38 | P a g e

Makes clear that applicability of the FRCP over diversity cases doesnt depend on the outcome determination test. The Constitution and federal power over procedure o Majority opinion: o Court emphasizes that you always have to be able to tie back federal law to some authorizing provision of the Constitution (such as the Commerce Clause). If you can make a reasonable argument that a matter is procedural that it was traditionally procedural, or wouldnt affect outcome, or that conflict-of-laws doctrines treat it as procedural there is authority in the Constitution that would let Congress enact the rule. So Congress has plenary power over federal procedure; the outcome determination test is irrelevant when Congress has spoken. Harlans concurrence

Arguably procedural, ergo constitutional Harlan thought the court standard isnt deferential enough to state interests. Accuses court of finding a grant of substantive legislative power in the constitutional provision for a federal court system (Article III). But he wouldnt constitutionalize the OD test. Harlans proposed test: Inquire if the choice of rule would substantially affect primary decisions of human conduct normally left to state regulation decisions not related to the actual conduct of the litigation. Decision to file suit is a matter of private, primary activity. Once you file, conduct of the litigation isnt primary activity. Places greater limits on federal governments power than the majoritys test. Hanna: Overview of the law applied in federal court o If federal law is binding on states, theres no choice to be made. But federal power over procedure in federal courts doesnt extend to state courts. o Four sources of federal power over procedural law: Are they subject to the Erie Analysis? Constitution: no Federal statutes: no Federal rules: pursuant to Rules Enabling Act, so: no. Federal common law of procedure: yes The direct collision test o Erie Analysis doesnt apply if theres a direct collision between a federal text (Constitution, statutes or a rule) and state law. If theres a direct collision (a federal text covers the point), you apply the federal text. If no direct collision, then apply Erie Analysis (outcome determination and balancing tests). HannaThe Erie Analysis o Modified outcome-determination test 39 | P a g e

Many if not most procedural variations can be outcome-determinative. So Hanna narrows the OD test. Choice is outcome determinative in the Hanna sense if the choice between federal and state law is outcome-determinative and would lead either to forum shopping at the outset of litigation or inequitable administration of laws. o Depends on how substantial the difference between federal and state laws is. Not clear how much more of a difference in outcome is required, though. o But mushiness here isnt a problem because forum-shopping prong will capture most of the cases in which application of different rules would lead to inequitable administration. o So the inequitable administration prong is a catch-all, for when forum-shopping prong isnt reliable and it would be troubling to let federal law apply. Hanna and Byrd: The Byrd balancing test is still alive and well.

F. Validity of Federal Rules The Rules Enabling Act (28 U.S.C. 2072) o FRCP are promulgated under the REA, which passes muster under the arguably procedural, ergo constitutional standard from Hanna. o 2072 appears to state two requirements for validity of federal rules: Must address a matter of practice and procedure And the rule must not abridge, enlarge, or modify any substantive right. REA Analysis: Three key points important! o REA analysis is distinct from Erie Analysis. (Erie applies only when theres no direct collision between federal text and state law.) o SC has never found that a federal rule of civil procedure transgressed REA. o FRCP enjoy a presumption of validity. But some courts say rules couldnt be applied consistently with REA in some cases. Professor Elys take o Intro: Critical question is whether the state right was granted for one or more nonprocedural reasons. (Focus is on purpose of the state law.) If so, under 2072(b) the federal rules give way to state law in the event of interference with the state law. Example: Federal rule creating a SOL in diversity cases probably would have to give way to a state law under 2072(b). SOLs are passed in part to give Ds repose after a certain amount of time has elapsed a purpose typically viewed as substantive. Narrowly defines procedural as connected to the actual conduct of the litigation. 40 | P a g e

o o

Rules valid on their face may be invalid as applied A critique (from Woolley)

Under the Ely approach, federal rules give way when state has a substantive purpose. But that seems to conflict with a principal goal of the REA: promoting uniformity in rules of procedure among federal courts across the country. Ely approach gives too much latitude to state law. But then, Erie Policy promotes vertical uniformity among federal and state courts sitting in the same state, which Elys approach also does. Given policy of uniform FRCP, why should REAs goal of uniformity across federal courts be frustrated by a states idiosyncratic decision to use a mechanism usually thought of as procedural to achieve a substantive purpose? Better view: REA is intended to cordon off from federal rulemaking certain sensitive areas limitations periods, remedies, burdens of production and persuasion to tell the courts and the Advisory Committee not to create rules in these areas because theyll modify, enlarge or abridge substantive rights. REA Analysis and the Supreme Court o SC has given little guidance about proper interpretation of REA. o Court has basically said that: A rule is valid under 2072(a) only if it really regulates procedure (Hanna) And rules that incidentally affect litigants substantive rights dont violate 2072(b) if reasonably necessary to maintain the integrity of that system of rules. [Burlington Northern R. Co. v. Woods] o Court has applied these standards with little analysis; cant tell whether it agrees with Elys state-centered approach. REA Analysis in the lower courts o Some lower federal courts have concluded that a particular rule of civ pro couldnt be applied to a particular case. Elys approach gives rise to that kind of argument. o These courts typically use something like the Ely approach to determine whether a federal rule would modify, abridge, or enlarge state substantive rights. But they take the following into account: While Ely would have a federal rule give way if the rule affects state substantive rights, lower courts recognize that Hanna and Burlington are more protective of the federal rules than Ely would be. o So theres no doubt that Elys approach isnt applied full-force by courts.

G. Construing Federal RulesAn Advanced Look at the Direct Collision Prong Remember: o Question of whether theres a direct collision is all about the interpretation of the federal text. o If we conclude that a federal rule covers the point, the federal rule will apply unless it was invalid on its face or invalid as applied. Walker v. Armco Steel Co.

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Court says in a footnote that the FRCP should be given their plain meaning. But the court failed to follow that and read the rule narrowly in order to avoid a direct collision between the federal rule at issue and state law. o One can read the footnote so as to avoid a DC analysis, which might require court to strike down the rule under the REA. Semtek v. Lockheed Martin Co. o A more recent decision in this area. Suggests that federal rules should be interpreted narrowly not just to avoid conflict with REA, but also to avoid conflict with federal rules and outcome-determinative state law. o Interpreting rules: o Keep in mind: Erie Analysis isnt used to determine validity of a federal rule. Its just one tool in construing the rules. If federal rule has always been given a particular meaning, fact that the rule would conflict with OD state law isnt going to carry the day in terms of interpretation of the rule. But if the rule is ambiguous, the fact that it might conflict with OD state law will be a factor in interpretation. Many scholars rejection the notion that rules should be read narrowly to avoid conflict. REA is designed to promote uniformity across federal courts; narrow readings in this sense instead create uniformity between state and federal courts sitting in the same state. Reading the rule narrowly to avoid interference with OD state law shrinks the scope of operation of the FRCP and turns matters over to the states under the Erie Analysis. But you can also argue for construing federal rules in light of the Erie Policy. Scalia, dissenting in Stewart v. Ricoh, says court should assume that Congress is just as concerned with avoiding significant difference between state and federal courts. So a broad reading of a rule that would create significant disuniformity should be avoided if the text permits. o In Semtek: Court unanimously agreed with Scalia that Erie Policy is relevant to interpretation of the FRCP. But Semtek can also be criticized for misapplying the principle set out in Stewart. Rule 41(b), dismissal of actions: Dismissal on the merits has a commonly understood meaning among lawyers. But Scalia adopted a truly bizarre interpretation, in part to avoid a conflict with OD state law. No justification for reading a federal rule of civ pro in such a strained way. PW: Even if you say the Semtek court went too far, its a harder question whether Erie Policy should be used as a rule of construction for ambiguous federal rules. Dont forget other tools of interpretation (plain language, leg. history, etc) If federal court is bound by state law, in determining what state law is, federal court seek to predict what the state supreme court would do.

V)

Venue and Forum Non Conveniens 42 | P a g e

1391 the venue statute o 1391(a): Claims arising solely out of diversity; (b) for all other claims. o 1391(a)(1) and (b)(1): There is venue in a judicial district where any D resides, if all Ds reside in the same state. Some courts hold that an individual D only resides in state of domicile. Others say individual D can reside in several districts. Ds only need to be from same state; can be from different judicial districts within a state. o 1391(a)(2) and (b)(2) Venue in judicial district in which substantial part of events or omissions giving rise to the claim occurred, or A substantial part of the property that is subject to the action is situated. Not satisfied if claim arose solely in foreign country (not judicial district) Provisions will often authorize venue for a particular suit in several dists. 1391(a)(3) and (b)(3): Fallback provisions; only look to these if a district in which venue is proper cant be found under 1391(a)(1),(2), or (b)(1),(2). Diversity cases: Venue is proper in districts where any D is subject to TJ. But action must be brought against each D in the venue that has TJ over it. Non-diversity cases: Venue is proper in district where any D is found. Doesnt apply for removal (from state to federal) State venue rules are not necessarily the same as federal venue rules. 1441(a): Suits filed in state court can only be moved to a federal district court that embraces the place where the state court sits. 1391: General venue statute doesnt apply to removed cases. Venue is a personal privilege of D, just like TJ.

Can be waived. D waives objection to venue by failing to raise it when she responds to Ps complaint (either by a 12(b) motion or in the answer). Transfer of Venue: 1404(a) o Overview Provides for transfer from one federal district to another. If SMJ, TJ and venue are proper, but venue is inconvenient, 1404(a) provides for transfer to a forum where suit might have been brought. Factors that court considers are similar to those considered under reasonableness of TJ. Similar also to forum non conveniens factors. (Listed on pg. 430, note 2) Hoffman v. Blaski Construes 1404(a) language: where suit might have been brought Court held that this means that a suit may be transferred only if venue would be proper in the transferee district under the general venue statute, 1391, or one of the more specialized venue statutes; or because consent was obtained before suit was brought. 43 | P a g e

Ds willingness to waive objection once suit has been brought is irrelevant. In addition, Hoffman has been interpreted to require that TJ be proper in the transferee court. Transfer vs. Forum Non Conveniens o Transfer under 1404(a) is available only between federal courts. o If a state court concludes that the state is an inconvenient forum, the only remedy is dismissal under state law on grounds of FNC.. o But federal courts dismiss on FNC only when they conclude that the United States would be a seriously inconvient forum. If the question is whether the suit should be heard in a federal court in another district, the case must be transferred, not dismissed on FNC. o Transfer is obviously a less dramatic mechanism than FNC dismissal. Venue and Choice of Law in Federal Court o How do horizontal and vertical choice of law intersect o The basic rule: Klaxon v. Stentor Electric Mfg. Co. Klaxon held that under Erie a federal court must apply the choice-of-law rules of the state in which it sits. Vertical uniformity and horizontal chaos Glannon This is how it works in a diversity case. Different for transfer. Choice of law and transfer: Van Dusen v. Barrack Holding: Klaxon rule isnt mechanically applied to transfers. Van Dusen held that if a federal court in which suit was brought had TJ over the D and venue was proper in that case, then after transfer, the transferee court must apply the choice-of-law rules of the state from which suit was transferred. This is consistent with Erie Policy; courtrooms change, law doesnt. When Van Dusen doesnt apply If transferor court didnt have TJ, or venue wasnt appropriate there, it can transfer to an appropriate forum instead of dismiss. Then the transferee court applies the choice of law rule of the state in which it sits. When P Moves for Transfer: Ferens v. John Deere Co. Issue: Does the Van Dusen rule apply when the P, rather than the D, makes the transfer motion? Facts/procedural history: P brought contract claim in PA and tort suit in MS. (SOL for tort suit had expired in PA.) MS: o Venue is proper for D o And theres TJ over D under stream of commerce theory. Then Ps file motion to transfer to PA under 1404(a), which requires transfer to a district where suit might have been brought. D doesnt object. 44 | P a g e

Under Hoffman: You need TJ in PA. There is: P lives there D does business there. Venue: Yes under 1391.

Holding: Van Dusen rule still applies when P seeks transfer. PA has to apply choice-of-law rules from MS. MS could apply its longer SOL, even if it couldnt apply its own substantive law. (See Sun Oil) Piper Aircraft Co. v. Reyno Facts/procedural history: Plane crash in Scotland. P sues Piper and Hartzell in CA state court; Ds file notice of removal to federal court. Jurisdictional basis for removal: o Complete diversity (1441) o 1441(a): Fed. court has original jurisdiction, and AIC requirement is met. o 1441(b) And no D is from the state where suit was brought. Once in federal court, Piper moved for transfer under 1406(a); Hartzell moved for dismissal based on lack of jurisdiction, or for transfer in the alternative. o Goldlarr v. Heiman: Transfer proper under 1406(a) when both venue and TJ are lacking. But many courts have permitted transfer under 1406(a) when its not venue thats lacking, but TJ. Others say you have to rely on 1404(a). Still others say it doesnt matter. CA federal court held that it didnt have TJ over Hartzell and transferred to federal district in PA. Only OK if PA is where suit might have been brought. (Has to be TJ and venue/consent.) Both Ds have TJ and venue in PA. Which states COL rules apply? Piper: CA COL rules which lead to application of PA law o TJ and venue were proper in transferor court, so Van Dusen rule applied. o Piper could have objected to TJ in CA; its not a slam dunk. But if failed to object, so it consented to TJ in CA court. Hartzell: PA COL rules which lead to application of Scottish law. o CA court said there was no TJ, so COL rules of transferee court applied. Piper and Hartzell moved to dismiss on grounds of FNC. Court grants, says the proper forum is Scotland. Piper and FNC law: federal vs. state Piper is the leading case on FNC in federal court. 45 | P a g e

Are federal courts required to follow state FNC rules? o Its an Erie question. Federal law of FNC is federal common law. But the court ducks the issue, says state and federal FNC laws were the same (not true!). o SC still hasnt really resolved the question. Authority for federal FNC o Any authority to create federal common law of FNC is going to be based in Article III. o Other possibility: Federal FNC, which applies only when the U.S. isnt the appropriate forum, should be viewed instead as a rule dealing with foreign relations of the U.S. So FNC doctrine would be deemed common law of foreign relations. If so: Federal FNC law would be binding on federal and state courts, under the Supremacy Clause. FNC law wouldnt be a federal law of procedure. Woolley: Probably not how the SC will go. Without an alternative forum, a federal court cant dismiss on grounds of FNC. Figuring out whether theres an alternative forum isnt always easy. o Fact that alternative forum would apply different or less favorable law than in the U.S. doesnt really matter. o If alternative exists, court has to consider public and private interest factors in deciding whether to dismiss on FNC. o Theres a strong presumption favoring Ps choice of forum.

Size of the Litigation

I) Preclusion A. Introduction Legal effect of a judgment is typically divided into two categories: o Res judicata: Claim preclusion o Collateral/direct estoppel: Issue preclusion Preclusion principles provide a set of common-law joinder rules supplementing Rule 18 of the FRCP. o Example: 18(a) is very permissive; allows (but doesnt require) a P to assert any other claim that he might have against a D. But common law of RJ requires a P to bring certain 46 | P a g e

other claims against a D in the same suit or lose those claims forever, if a final judgment is entered in the lawsuit. B. Intersystem Preclusion: 1738 The principles applied by a judicial system to determine the preclusive effect of a different judicial systems judgments. For state court judgments: o 28 U.S.C. 1738: Requires federal courts to give full faith and credit to state court judgments to give the same effect that the rendering state court would. Constitution (Article IV, 1) puts this obligation on states only. 1738 is binding on both. o Notice: Erie and Klaxon require a federal court to apply the law of the state in which it sits. 1738 requires a court to apply the claim- and issue-preclusion law of the state that rendered the judgment. For federal judgments: o The Supreme Court recently explained in Semtek International Incorporated v. Lockheed Martin Corp. (2001) that federal common law requires state courts to give a federal judgment the same force and effect that a federal court would give to the judgment. o But federal preclusion law isnt uniform. Semtek says that in determining the preclusive effect of a federal judgment, sometimes you need to refer to the preclusion law of the state in which the federal court that rendered the judgment sits. What force and effect would a federal court give to a federal judgment? Supreme Court indicated in Semtek that an Erie analysis may be necessary to answer that. Many have interpreted Semtek to mean that in a diversity case, federal courts ordinarily will borrow the preclusion rules of the state in which the federal court rendering the judgment sits. In other words: Semtek might require reference to preclusion rules of the state where the federal court rendering the judgment sits when failure to do so would produce the sort of forum-shopping and inequitable administration of the laws that Erie seeks to avoid, unless applying state law in those circumstances would be incompatible with federal interests. o In a case based on federal question jurisdiction: Apply federal common law. C. Intrasystem Preclusion The principles applied by a judicial system to determine the preclusive effect of its own judgments. In federal courts: Semtek In state courts: A state court will apply its own preclusion rules to determine the preclusive effect of its own judgments. D. Claim Preclusion A final judgment on the merits o Judgment is final on entry of judgment, unless or until reversed on appeal. To have claimpreclusive effect, judgment must be on the merits. 47 | P a g e

Judgment after trial or JMOL = on the merits Dismissal for lack of jurisdiction or venue = not on the merits. Depending on the judicial system: may or may not be on the merits: Judgment that suit is barred by SOL Demurrer Dismissal for failure to state a claim Definition of a claim in preclusion context: o 24 of Second Restatement of Judgments Used in federal courts and many (but not all) judicial systems Known as the transactional approach When a valid and final judgment rendered in an action extinguishes the plaintiffs claim, the claim extinguished includes all rights of the plaintiff to remedies against the defendant with respect to all or any part of the transaction, or series of connected transactions, out of which the actions arose. (HTF, pg. 1172) What factual groupings constitute a transaction, and what constitute a series, are to be determined pragmatically. Essentially, ask whether theres a logical relationship between facts supporting the federal theory of liability and the facts supporting the state theory of liability. o The logical relationship test operates here much like it does in terms of supplemental jurisdiction. Claim preclusion and SuppJ ask the same question: What is an appropriate litigation package? o But CP and SuppJ approach the question from different perspectives. There are different considerations and policy concerns; tests are identical, but same basic idea. o What should be allowed to be heard vs. what must be tried together. Doesnt matter whether you win or lose; CP still applies.

Separate claims against each D General view is that P has a separate claim against each D for claim-preclusion purposes. (For logical relationship test of jurisdiction, multiple Ds may be part of the same case or controversy.) But there may be a problem with issue preclusion. Limited exceptions to Second Restatement approach 26(1)(c): P can split claim if he was unable to rely on a certain theory of the case, or to seek a certain remedy or form of relief in the first action, because of the limitations on the subject matter jurisdiction of the courts or restrictions on their authority. (Deals with jurisdiction)

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Example: State law says an action can only be brought in municipal court, but municipal court has no jurisdiction over federal question claims. 26(1)(d): Claim isnt extinguished if it is the sense of the scheme that the P should be permitted to split his claim. 26(1)(f): Used rarely; refers to a continuing restraint or condition having a vital relation to personal liberty. o

E. Issue Preclusion Three basic requirements for IP: Issue must have been: o Actually litigated o Determined o And essential to the judgment. Was the issue actually litigated? o Doesnt require trial. o Second Restatement: An issue is actually litigated when an issue is properly raised by the pleadings or otherwise and is submitted for determination and is determined. o But if D admits an allegation or fails to raise an affirmative defense, those issues have not been actually litigated. Was the issue determined? o General verdict: Hard to say what elements of the claim the jury decided. o Special verdict: Specific findings of fact. Clearer to determine what issue was decided. Was the determination essential to the judgment? o Competing ideas: An alternative determination is no less such for being alternative, especially given the multi-issue, alternative theory modes of litigation common in modern procedure. An alternative determination is dictum in the sense that a court would have reached the same result with or without the determination. Second Restatements weird compromise: An alternative determination is deemed essential to the judgment if a particular finding was reviewed and affirmed on appeal. (If you get the extra level of review, the determination will be deemed essential to the judgment.)

Is the same issue involved? o If issue in second suit isnt identical to the issue in the first suit, ask: Does it make sense from standpoint of fairness and efficiency to treat the matter as involving the same issue? o 27, comment c: Balance interests a desire not to deprive a litigant of an adequate day in court and a desire to prevent repetitious litigation of what is essentially the same dispute. Preclusion ordinarily is proper if the question is one of the legal effect of a document identical in all relevant respects to another document whose effect was adjudicated in a prior action. And, in the absence of a showing of changed circumstances,

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a determination that, for example, a person was disabled, or a nonresident of the state, in one year will be conclusive with respect to the next as well. F. Nonmutual Collateral Estoppel Generally o Occurs when a nonparty to first suit invokes judgment in an earlier suit. o Trend favors application of nonmutual collateral estoppel, though some scattered jurisdictions dont recognize it. o Due Process: NCE can only apply against a party to previous litigation. Cant apply against someone who wasnt a party to previous litigation. Types of NCE o Defensive: D uses the first judgment as a shield against liability. o Offensive: P uses first judgment as a sword for liability. Offensive NCE: o Parklane Hosiery Co. v. Shore Facts: Shareholders seek to rely on finding in earlier suit that Parklanes proxy statement was misleading (earlier finding used as a sword). Courts holding Considers two arguments against offensive NCE: o Offensive NCE doesnt promote judicial economy In defensive NCE, P has an incentive to join all the Ds. But in offensive NCE, P2 has no incentive to join in the first suit, because he can take advantage if D loses (a free ride) but isnt bound if D wins. Offensive NCE may be unfair to a D.

D may have had little incentive to defend against first suit because it was for small or minimal damages, and second suit wasnt foreseeable. Also unfair if the judgment relied on by P is inconsistent with one or more previous judgments. Train wreck hypo: Railroad collision injures 50 passengers. All sue. First 25 Ps lose, but 26th wins. Is it fair to allow Ps 27 through 50 to rely on that judgment? Procedural opportunities may not have been available in the first action that could have led to a different result. Court says it doesnt want to preclude offensive NCE in every case; its up to the trial court discretion. But no offensive NCE in this case. The 7th Amendment issue o Stewart used pro-jury opinion in Beacon Theatres to deny Parklane a jury in the second suit. Rehnquist dissents, arguing that because NCE wasnt available at the time the 7th Amendment was decided, theres a constitutional problem here. 50 | P a g e

Rhetoric is attractive, but its not faithful to 7th Amendments development. The amendment hasnt been used as a barrier to renewed motions for judgment as a matter of law, for example, and other things that werent around at the time the 7th Amendment was incorporated into the Constitution. It has never been viewed as a bar to procedural innovation. o But Rehnquist is right to point out absurdity of courts assertion that presence or absence of a jury should somehow be viewed as a neutral factor though implications of the view that juries arent a neutral factor are broad. CE, period, should be inappropriate if the first suit wasnt tried to a jury, under Rehn.s view. The easy joinder limitation on offensive collateral estoppela caveat o Parklane court: If P who easily could have joined first litigation doesnt join, offensive NCE should be denied. (Avoids the free rider problem.) But: Most courts have no adopted a principle of compulsory intervention. A party who didnt participate in the prior proceeding for sound tactical reasons but wasnt just sitting on the sidelines hoping to capitalize on a favorable result shouldnt be denied the benefits of collateral estoppel. Easily could have joined statement is a dead letter, essentially.

Defensive NCE o Similar considerations of fairness. o Example: If P brought series of patent infringement actions in 50 cases, and P wins first 25, but in 26th the patent is found invalid. o Presumably, a court may consider unfairness with respect to offensive and defensive NCE. NCESystemic issues o Does efficiency justify binding the D in innumerable future trials, based on a loss in the first trial? Sometimes irrational factors affect jury verdicts. o Judicial economy was one concern in Parklane; another was the aura of the gaming table. But why isnt a collective best guess trying the suit multiple times more consistent with avoiding the aura of the gaming table? The more juries you have addressing an issue, the more likely it is that on average, youll reach a fair result. o Probabilistic analysis: NCE disadvantages a D in a way that may not be appropriate. It may impose a greater risk on Ds than is appropriate. On the other hand, NCE certainly saves time and money. o Woolleys view: Its not that NCE isnt good; its that something is sacrificed when we use NCE, and in determining whether NCE is appropriate, we need to consider not just judicial economy but fairness to Ds as well.

II)

Joinder A. Generally 51 | P a g e

Two questions to ask about any claim in federal court: o Is it jurisdictionally proper? (Is there a basis for SMJ over the claim?) o Is it procedurally proper? (i.e., do the FRCP authorize this claim?) Scope of the joinder rules: Two basic principles o Rules 13 and 14 state only threshold requirements. If a proper cross-claim or third-party claim is asserted, any other claim may be joined under Rule 18. 18(a): Party asserting a claim, counterclaim, cross-claim, or third-party claim may join as many claims as it has against an opposing party. (Once youve met the requirements of 13(a).) 13(a): If you have a compulsory counterclaim but dont bring it, its gone forever. But if the claim has already been asserted in another action, you dont need to assert it as a compulsory counterclaim. o Parties who arent originally opposing parties for purposes of the compulsory counterclaim rule (e.g., co-defendants may become opposing parties later (if, e.g., a co-D asserts a cross-claim against another D). Venue, counterclaims, and Rule 14 claims o Courts typically have concluded that venue requirements do not apply to counterclaims, cross-claims, or Rule 14 claims, with one exception: Venue must be satisfied with respect to additional parties joined to a permissive counterclaim under Rule 13(h).

B. The Rules of Joinder Rule 20: Permissive joinder of parties o Authorizes plaintiffs to sue together if (1) they assert claims arising out of the same transaction or occurrence (or series of transactions or occurrences) (2) their claims against the defendant or defendants will involve a common question of law or fact. Allows plaintiff to sue multiple defendants in a single action if the same criteria are met. Does NOT require parties to be met whenever the criteria in the rule are met.

o o

Counterclaims and Cross-Claims o Authorize parties, once they are properly joined in a lawsuit, to assert additional claims against opposing parties. o Don't forget to make sure that SMJ is also proper o Rule 13: Once a proper cross-claim has been asserted, Rule 18(a) allows added unrelated claims. Rule 13: Authorizes a defending party in a suit to assert claims back against a party who has claimed against him (a) Compulsory: if it arises from the same transaction or occurrence as the claim against him. Authorizes any defending party (not just original defendant) "a pleading" to assert a claim against an opposing party. (b) Permissive: may assert claims completely unrelated to the original claim. Authorizes any defending party (not just original defendant) "a pleading" to assert a claim against an opposing party. 52 | P a g e

(g) provides for assertion of cross-claims arising out of the same transaction or occurrence as the main claim; asserted by one party against a co-party (i.e. D v. D, not an opposing party). (h) Allows a party who has asserted a counterclaim or cross-claim to join other parties against whom he or she has a transactionally related claim. (Rule 13(h) is to counterclaims and cross-claims what Rules 19 and 20 are to ordinary claims.)

Rule 18 (a) Party seeking relief from an opposing party may join with his original claim any additional claims he has against that opposing party. No common transaction or occurrence requirement Authorizes "a pleader" (original plaintiff and any party seeking relief against another party - on a counterclaim, cross-claim, or third-party claim) to assert as many claims as he has against an opponent Rule 14: impleader Gives a defendant a limited right to implead new parties against whom she has claims related to the main action. Examples of impleader: contribution, indemnity No right to substitute another defendant or add one under Rule 14; different from situations in which defendant contends that the other person is liable directly to the plaintiff. 3rd-party Ds liability will depend on the outcome of the main claim. Impleaded party may escape liability by defeating either Ps original claim or the Ds derivative claim against him Impleader claim treated like an original suit for pleading, service, etc. Must file a 3rd party complaint against impleaded 3rd party defendant under pleading rqts (Rules 8-11) Served (Rule 4) 3rd Party Defendant Respond (Rule 12) 3rd Party D may implead further parties (Rule 14) & plaintiff & 3rd party D can assert claims against each other if they arise out of the same transaction or occurrence as the main claim Time limit: within 10 days of answering the complaint without obtaining leave of court.

C. Rule 4(k)(1)(B): Another Ground for TJ Over a Party Joined Under Rule 14 Generally o 4(k)(1)(A) is the workhouse for federal TJ. o 4(k)(1)(B) gives an additional option for courts. Service 53 | P a g e

Establishes TJ over a D who is a party: joined under Rules 14 or 19 and is served within a judicial district of the U.S. and not more than 100 miles from where summons was issued. Still have to satisfy the Constitution in order for service to be appropriate, but thats rarely a problem under 4(k)(1)(B), because the Fifth Amendment allows jurisdiction so broadly the national contacts test. (The nation is the appropriate unit of analysis.) Theres controversy over whether the Fifth Amendment jurisdictional tests includes a reasonableness prong. Many federal courts reject the view that the Fifth Amendments due process clause requires a reasonableness test separate from the minimum contacts test. 4(k)(1)(C) and 4(k)(2) dont incorporate the 14th Amendments DP clause; what matters is the Fifth Amendments DP clause. Under 4(k)(1)(A), though you have to look at the state statute and state limits on TJ, governed by the 14th Amendment Due Process Clause. (The state is the appropriate unit of analysis.)

D. Rule 20: Permissive Joinder of Parties Makes it relatively easy to join Ps and Ds. For Ps: 20(a)(1): Persons may join in one action as plaintiffs if: o (A) they assert any right to relief jointly, severally, or in the alternative with respect to or arising out of the same transaction, occurrence, or series of transactions or occurrences; and o (B) any question of law or fact common to all Ps will arise in the action. For Ds: 20(a)(2): Persons may be joined in one action as Ds if: o (A) any right to relief is asserted against them jointly, severally, or in the alternative with respect to or arising out of the same transaction or occurrence or series of transactions or occurrences; and o (B) any question of law or fact common to all Ds will arise in the action. If joinder is improper under Rule 20: You can drop a party under Rule 21 instead of dismissing the claim.

E. Rule 19: Mandatory Joinder Generally o Two step inquiry under Rule 19: Must a party be joined if feasible? (If so, its a necessary party.) Should the suit be dismissed if joinder is infeasible? (If so, its an indispensable party.) Common mistake: Dont assume that Rule 19 applies more often than it actually does. For example, it doesnt treat jointly and severally liable tortfeasors as necessary parties to be joined if feasible.

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Temple v. Synthes: P chose not to sue all three Ds in the same action. The Supreme Court responded, in very summary fashion, to the argument that the other tortfeasors were necessary parties to be joined if feasible by granting cert and reversing summarily without even an oral argument. The main point is that Rule 19 is far narrower than novices often assume. Its read in light of the very high value our legal system traditionally has placed on party autonomy in the structure of lawsuits. A P should rarely be required to join parties he doesnt wish to join in the litigation. 19(a)(1)(A): Party must be joined if court cant afford complete relief. o Very narrow. Applies if lawsuit seeking conveyance of land were filed against one joint owner; one owner by himself cant transfer the property, so the other owner would be a necessary party. o Still doesnt apply to a J&S tortfeasor, or in train wreck hypo (from collateral estoppel). 19(a)(1)(B) o (i): Party must be joined if he has an interest in the subject of the action and disposing of the action in his absence may impair or impede the persons ability to protect the interest. Practical impairment of a legally protected interest is all thats required. o (ii): Party must be joined if he has an interest in the subject of the action and disposing of the action in his absence may leave an existing party subject to a substantial risk of incurring double, multiple or otherwise inconsistent obligations because of the interest. Inconsistent is read narrowly. Basically means a D might be forced to do something that different judgment might require him not to do. Feasibility of Joinder: o P is required to join a necessary party if it would be feasible to do so. And its usually feasible when: The court has TJ over the party Joinder wont destroy SMJ And venue is proper (but its up to the party being joined to object to venue) Remember: A P is usually required to join a necessary party as a defendant, rather than a plaintiff. o When joinder is infeasible If joinder would be infeasible, the court must decide whether the suit must be dismissed (Rule 19(b)). But the mere fact that a necessary party cannot be joined does not mean the suit will be dismissed. That decision is made only if the court concludes that in equity and good conscience the suit should be dismissed rather than allowed to proceed. Critical question: Would it be fair to allow the action to proceed despite the absence of the absentee? (Factors identified in 19(b)(1)-(4).) But some cases are clear cut: When D would suffer prejudice, and P can obtain full relief by proceeding in a state court: dismissal is warranted.

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But if D can protect himself by joining the party in question, D cant obtain a dismissal just because P failed to join him. o Important: Ds obligation to act to protect itself is important because a D often has greater freedom to bring in another party than a P does. o Thing about SuppJ: 1367(b) applies only to claims by Ps. And venue requirements often dont apply to claims asserted by a D.

F. Interpleader Generally o Interpleader claim or counterclaim requires claimants to fight among themselves about who is entitled to money or property. (Dont confuse with impleader.) o If stakeholder doesnt claim property, the stakeholder essentially ends up on the sidelines, and the litigation turns into a contest among the claimants Two kinds of interpleader: o Rule interpleader: FRCP 22(a) o The ordinary rules of SMJ, TJ, and venue apply.. Statutory interpleader: ( 1335) All thats required to establish SMJ is that the amount in controversy exceed $500 and that only one claimaint be diverse from another claimant. Moreover: Under 2361 and Rule 4(k)(1)(C), federal district courts in statutory interpleader cases are freed from the limitations of 4(k)(1)(A) and may exercise personal jurisdiction to the limits of the Constitution, provided the claimant may be served in the U.S. (because under 2361, theres nationwide service of process). And under 1397, venue in a statutory interpleader case is proper in a district where one of the claimants resides. Bottom line: Statutory interpleader substantially relaxes requirements for SMJ, TJ and venue.

III)

Class Actions A. Rule 23 Certification Suit brought as a class action may proceed as a class suit only if the court certifies it as a class suit. 23(a) sets out four requirements before a class suit can be certified: o Class is so numerous that joinder of all parties is impracticable o There are questions of law or fact common to the class o The claims or defenses of the representative parties are typical of the claims or defenses of the class. o Representative parties will fairly and adequately protect the interests of the class (very important). 56 | P a g e

B. Importance of Class Counsel 23(g)(4): Class counsel must fairly and adequately represent the interests of the class. o May be more important than (a)(4), since as a practical matter class suits are run by attorneys. o Class counsel is basically the decisionmaker in a class suit. Case law says class counsel can disregard instruction of the named Ps if he doesnt believe those instructions would be in classs best interests. Class counsel have settled litigation over named Ps objections. So its crucial that they be qualified and put classs interests before their own. C. Rule 23(b) In addition to 23(a), a class suit must fit within one of the subdivisions of 23(b). 23(b)(1): Similar to 19(a)(1). Addresses same problems as when there are too many potential parties to make joinder feasible. 23(b)(2): Allows injunctive or declaratory relief on behalf of the class when the opposing party has acted or refused to act on grounds that apply generally to the class. 23(b)(3): Class suits in general o Commonly known as damages class actions thats what they seek. o To certify a class under (b)(3), a court must find a question of law or fact common to the class predominates over individual issues, and class adjudication must be superior to other available methods for fairly and efficiently adjudicating the controversy. (Predominance + superiority) Basically asks: Does it make sense to try this suit as a class action? If certain issues arent common to the class, its possible to avoid the predominance problem by certifying an issue class under 23(c)(4) Key question in deciding whether to certify an issue class should be whether a class suit resolving an issue (i.e., of railroads negligence in train wreck hypo), followed by individual suits (i.e., damages incurred by train passengers), would be fairer and more efficient than having each P go out and bring a suit addressing all the issues. o Types of Rule 23(b)(3) Class Suits Negative value class suits: Not worthwhile for any individual P to bring a suit on his own. But it makes economic sense for an attorney to take on the litigation if you aggregate the little claims (Shutts). Essentially these are large-scale, smallclaim suits. Claims large enough to justify individual litigation, but there are efficiency gains to be achieved through use of the class device. (Rhone Poulenc) In Re Rhone-Poulenc Rorer o Facts: 300 suits with over 400 Ps filed in state court to determine liability of drug manufacturer to hemophiliacs. o Procedural history: All cases were transferred to one court for pre-trial proceedings under 1407 (which allows this when you have many suits and resolution would benefit from a coordinated set of pre-trial proceedings, but cases need to be sent back to district where they were filed to be tried). 57 | P a g e

District judge certifies one of the cases as a nationwide class action Effect: Everyone in the nation who fits the definition of the class becomes part of the class, including those who havent filed suit. Theyre members unless they opt out. Certification under 23(b)(3) Territorial jurisdiction: Class Ps consent to TJ at least if the class members are adequately represented. No need to opt in (Shutts). Common question of law or fact predominating over individual issues: District court tailored the suit to address only one of the issues that would have to be litigated before an individual class member could recover against the drugmaker the drugmakers negligence. Done under 23(c)(4): issue class certification Relevance of choice of law to certification District court relied on Illinois laws allowance to use Illinois negligence law. So it didnt have to interpret and apply the law of all the states. Ds who want to avoid certification will often argue that the law of multiple states must be applied in the class suit. And class counsel will often argue that one substantive law may be applied to all the claims in the class suit. Choice of law decision Analytical framework Shutts makes it easier to bring a nationwide class suit than would an optin requirement. But its choice of law holding could make adjudication of class suits impossible if laws of multiple states apply. (Erie and Klaxon put federal courts in the same difficult position as the state courts with respect to choice of law.) But Shutts doesnt create a problem when there are no relevant differences between the laws of potentially relevant states. Sun Oil: State can impose burden of conflict between law of the forums on the party seeking application of nonforum law (here, the D). To violate the Full Faith and Credit and Due Process Clauses, its not enough that a state misconstrue the law of another state; the misconstruction must contradict law of the other state that is clearly established and has been brought to the courts attention. District Courts reasoning District court was required to apply IL choice of law rules, provided those COL rules are consistent with the Constitution. And they are; they create a presumption that IL law applies. Court found that the Ds hadnt met burden of showing that negligence law of other states was different from IL law. So court concluded that the suit was manageable. Seventh Circuits decision Appellate review of certification decision: 1291, 1292(b), 1651 Certification isnt a final judgment. How did circuit get around the FJR? 58 | P a g e

1291: Appellate court has jurisdiction over appeals of all final decisions of district courts in the U.S. 1292(b): Provides for review of interlocutory decisions. But thats available only when the district court and the court of appeals agree that review would be appropriate. Today, a party can seek interlocutory review of a certification decision under Rule 23(f). Key difference from 1292(b) is that you dont need the district courts decision. Mandamus Argument Remember Beacon Theatres: Court there said denial of a jury trial is an appropriate use of mandamus, but otherwise its quite hard to get. Here: Court of appeals said mandamus is appropriate only if certification wont be effectively reviewable at the end of the case, and the ruling is usurpative. Appeals court decided mandamus would be appropriate because the certification decision could cause irreparable harm by forcing Ds to settle and would be an abuse of discretion. o Forcing Ds to stake their companies on outcome of a single jury trial is improper o District courts COL decision violated limits on COL imposed by Erie o And the issue class posed 7th Amendment problems. 7th Amendment issue Amendment says no fact tried by a jury shall otherwise be re-examined in any court of the U.S. than according to the rules of the common law. Lots of debate over what this means. Woolley: Major reasons to doubt Posners reading of this. o Makes the re-examination clause much more important than in the past. o Posners argument: Cant have comparative negligence without re-examining negligence Problem with that: It makes collateral estoppel impossible to use in certain circumstances that have never been thought problematic.

Choice of law issue 7th Circuit rejected the issue that there are no material differences in negligence law of the various states. o Woolley: 7th Circuit may be right as a matter of substantive law; not all states would agree on the novel legal theory that Ps had in this case. o But Sun Oil says that its not enough that a state misconstrue the law of another state; misconstruction must conflict with law of 59 | P a g e

the other state that is clearly established and has been brought to the courts attention. o And court doesnt cite to Klaxon which says a federal court must apply COL rules of the state in which it sits. Was Posner right that it would be unfair to have the claims tried by one jury the class jury? Posner relies on the fact that 12 of the 13 juries that had addressed the matter previously had found in favor of the Ds. But Ds can look at the whole portfolio of cases; Ps cant, so Ds have a strategic edge. Maybe a class is the way to even out the issue. Why is nonmutual collateral estoppel not available here? There are inconsistent judgments. Ds resistance to class certification Class suit can put enormous pressure on Ds. With negative value class suits, Ds have enormous incentive to resist class certification. Rhone-Poulenc and a slew of other cases demonstrate that the federal courts arent a good place to seek class certification. Generally, a Ps attorney will have better luck if he files class suit in a state judicial system (though some states have a hostile reputation). Class Action Fairness Act: Makes it easier for a D to remove a class suit to federal court a boon for Ds.

D. Class Suits as a Strategic Tool for Defendants A class suit isnt necessarily bad for a D and beneficial to a class; class members exercise very little control over class counsel. Class counsel have enormous discretion: o May settle a case over named Ps objections, and even over the objections of a majority of the class, provided that the court approves the settlement (which is required under Rule 23(e)). 23(e)(2): Court can approve only after a hearing and finding that the settlement is fair, reasonable, and adequate. This is the reason why class suits are always embodied in a judgment, whereas in ordinary litigation you dont have a judgment other than dismissal. o Counsels abilities to settle mean that the class device is a useful tool for Ds seeking to impose a settlement a way to manage risk. Class counsel may even negotiate a settlement before a class suit is filed. You can bring the settlement to court when you file suit and seek certification. Use of class device to impose settlement on large groups of claimants can be criticized and defended on various grounds. But focus on abusive settlements: Abusive settlements: These benefit class counsel who bargain, essentially, with D for handsome compensation in exchange for agreeing to a settlement that will benefit D by settling claims more cheaply than they should be settled for than would have been possible if class 60 | P a g e

attorney who was vigorously advocating for class interests would have been able to obtain. In extreme cases, this can give rise to a reverse auction where Ds are bargaining with a number of class counsel, each of whom is competing to settle the case more cheaply. Attorneys who lose that auction wont be able to recover any of their attorney fees. They essentially wont be compensated. Since courts have an incentive to clear dockets, theyre sometimes less than conscientious in supervising settlements to ensure theyre fair, adequate and reasonable. Traditional rule in the U.S. is that a class judgment is not entitled to full faith and credit, and can be collaterally attacked if absent class members arent adequately represented. But that traditional rule has come under sustained attack in recent years and may not survive. Summary: You cant assume that Ds will always be hostile to certification of a class suit. Sometimes they can achieve objectives through certification. In some ways Class Action Fairness Act provides some protection against reverse auctions (which are facilitated when multiple class suits are filed in multiple jurisdictions that dont coordinate with one another then D has some leverage, because as soon as the judgment is reached and approved in one jurisdiction, it becomes res judicata and becomes binding on class members, unless collateral attack is permitted). But if class suits are removed to federal court, mechanisms like 1407 (transfer of suits to one district judge for pretrial proceedings before suit is returned to forum of origin) and 1404(a) can lead to coordination of class actions brought in federal courts. Also: CAFA includes substantive restrictions on settlements reached in federal class actions. One provision in 28 U.S.C. 1713 provides protection against class settlement in federal court that ends up costing absent class members money. Some protection. But CAFAs removal provision (1453) doesnt allow absent class members to remove the suit from state to federal court. That means CAFA may provide no protection against abusive settlements to the extent that Ps counsel and Ds reach agreement to keep or file class action in state court. But if competing class counsel files competing suit in state court before abusive settlement is turned into state court judgment, it could be argued (controversially) that federal court has the power to enjoin the state court proceedings. Bottom line: Ds sometimes have strong incentives to resist certification. But class certification can be an important strategic tool for Ds.

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