JURISDICTION y Two kinds of jurisdiction before a court can decide a case, it MUST have jurisdiction over the parties

as well as over the subject matter o Subject matter jurisdiction refers to the courts power to decide the kind of case before it o Jurisdiction over the parties refers to whether the court has jurisdiction to decide a case between the particular parties, or concerning the property before it Jurisdiction over the parties there are 2 distinct requirement which MUST be met BEFORE a court has jurisdiction over parties: o Substantive due process the court MUST have power to act, either upon given property, or on a given person so as to subject her to personal liability.  The 14th Amendment Due Process Clause imposes this requirement of power to act, as a matter of substantive due process o Procedural due process the court MUST have given the D adequate notice of the action against him, and an opportunity to be heard  These are the requirements imposed by the 14th Amendment Three kinds of jurisdiction over the parties (THEORIES OF AMENABILITY) o In personam (jurisdiction over the Ds person) gives the court power to issues a judgment against her personally. ALL of the persons assets MAY be seized to satisfy the judgment, and the judgment cab be sued upon in other sates as well. o In rem (jurisdiction over a thing) gives the court power to adjudicate a claim made about a piece of property or about a status. Ex: an action to quiet title to real estate, OR an action to pronounce a marriage dissolved o Quasi in rem jurisdiction the action is BEGUN by seizing property owned by attachment OR debt owed to garnishment the D w/in the forum state.  The thing seized is pretext for the court to decide the case w/out having jurisdiction over the Ds person.  Any judgment affects only the property seized, and the judgment CANNOT be sued upon in any other court o Minimum contacts requirement IF jurisdiction in the case is in personam or quasi in rem, the court may NOT exercise that jurisdiction UNLESS D has minimum contacts w/ the state in which the court sits.  D has to have taken actions that were purposefully directed towards the forum state Ex: D sold goods in the state, or incorporated in the state, or visited the state, or bought property in the state, etc.)  W/out such minimum contacts, exercise of jurisdiction would violate D's 14th Amendment federal constitutional right to due process  Unreasonable exercise EVEN IF D has the requisite minimum contacts w/ the forum state, the court will NOT exercise jurisdiction IF considerations of fair play and substantial justice would require making D defend in the forum state so unreasonable as to constitute a due process violation. y In MOST cases, IF D has the required min. contacts w/ the forum state, it will NOT be unreasonable for the case to be tried there Long-arm statute permits the court of a state to obtain jurisdiction over persons NOT physically present w/in the state at the time of service o Substitute service long-arm statutes provide a substitute means of service 1

Ex: long-arm statute might allow the P to cause the D to be served out of state by registered mail Flow chart figure 2-1

A. PERSONAL JURISDICTION (a) Over PERSONS y Different categories a. Presence w/in the forum state b. Domicile/residence w/in the forum state c. Consent to be sued w/in the forum state d. Driving a car w/in the forum state e. Committing a tortious act w/in the forum state (OR committing out-of-state acts W/ in-state tortious consequences) f. Ownership of property w/in the forum state g. Conducting business w/in the forum state h. Being married in w/in the forum state (or living while married) o NOTE recall that due process requires that the individual have min. contacts w/in the forum state BEFORE personal jurisdiction may be exercised over her y Presence even if the individual is an out-of-state resident who comes into the forum state only briefly, personal jurisdiction over him may be gotten as long as service was made on him while he was in the forum state Ex: Burnham v. Superior Court D and his wife, P, separate while residing in NJ. P moves to CA with their children. D visits CA on business and stops briefly to visit the children. While D is visiting, P serves him with process in a CA suit for divorce. D never visits the state-again HELD CA can constitutionally assert personal jurisdiction over D based on his PRESENCE in the state AT THE TIME OF SERVICE, even though that present was brief, and even though D had virtually NO other contacts with the state y Domicile jurisdiction may be exercised over a person who is domiciled w/in the forum state, EVEN IF the person is temporarily absent from the state. o A person is considered to be domiciled in the place where he has his current dwelling place, if he also has the intention to remain in that place for an indefinite period y Residence jurisdiction may be exercised on the bases of D's residence in the forum state, even though he is absent from the state. o A person may have several residences simultaneously o The SC has NOT yet passed on the dues process validity of jurisdiction based solely on residence, so this remains presumptively a valid method of gaining jurisdiction y Consent jurisdiction over a party can be exercised by virtue of her consent even if she has NO contacts whatsoever with the forum state Ex: P, who does NOT reside in OH or have any contacts with OH, brings suit against D in OH. By filing the suite in OH, P will be deemed to have consented to OH jurisdiction. D may then counterclaim against P. Even if P dismisses his own suit, his consent to the action will be binding, and the OH courts WILL have personal jurisdiction over him on the counterclaim. y Non-resident motorist jurisdiction over a non-resident motorist may be exercised (IF state has statute allowing for this), who have been involved in accidents IN the state Ex: P is a resident of the forum sate. D, NOT a resident of the forum state, is driving his car IN the forum state, and has a collision w/ Ps car. EVEN IF D has NO other contacts 2

w/ the state, a non-resident motorist statue will probably be in force in the state, and will probably give the forum states courts jurisdiction over a tort suit by P against D. o Service on state official most non-resident motorist statutes provide for IN-STATE service of process on a designated state official (e.g., the Director of Motor Vehicles) and for registered mail service on the OUT-OF-STATE D himself. In-state tortiousness jurisdiction over a party may be exercised over persons committing tortious acts w/in the state Ex: D, an out-of-stater, gets into a fight with P at a bar in Ps home state. P wants to bring civil battery claims against D in the state. IF, as is likely, the state has a long-arm provision governing tortious acts w/in the state, P WILL be able to get personal jurisdiction over D in the battery action Out-of-state acts w/ in-state consequences o Gray v. American Radiator Corp. o Some in-state tortious acts long-arm clauses have been interpreted to include acts done outside the state which produce tortious consequences w/in the state. o In a products liability situation, a vendor who sells products that he knows will be used in the state may constitutionally be required to defend in the state, if the product causes injury in the state Owners of in-state property jurisdiction over a party may be exercised over owners of instate property in causes of action ARISING from THAT property o Conducting business jurisdiction over a party may be exercised over non-residents who conduct business w/in the state.  Since states may regulate an individuals business conduct in the state, they may constitutionally exercise jurisdiction relating to that doing of business Domestic relations cases jurisdiction over a party may be exercised over a non-resident party to a domestic relations case. The requirement of min. contacts APPLIES here, as in EVERY personal jurisdiction situation (and that requirement may BAR the state from taking jurisdiction) Ex: Kulko v. Superior Court A father resides in NY, and permits his minor daughter to go to CA to live there w/ her mother. HELD the father does NOT have sufficient min. contacts w/ CA to allow the mother to bring an in personam suit in CA against him for increased child support.

(b) Over CORPORATIONS y Domestic corporations ANY action my be brought against a domestic corp. (i.e., one which is incorporated in the forum state y Foreign corporations a state is much more limited in its ability to exercise jurisdiction over a foreign corp. (i.e., one NOT incorporated in the forum state) o Minimum contacts the forum state may exercise personal jurisdiction over the corp. ONLY IF the corp. has min. contacts w/ the forum state such that the maintenance of the suit does NOT offend traditional notions of fair play and substantial justice (International Shoe v. Washington) o Dealings w/ residents of forum state a corp. WILL be found to have the requisite min. contacts w/ the forum state ONLY IF the corp. has somehow voluntarily sought to do business in, or w/ the residents of, the forum state. Ex.1 (min. contacts found): International Shoe Co. 3

D has no activities in Washington except for the activities of its salesmen, who live in the state and work from their homes. ALL orders are sent by the salesmen to the home office, and approved at the home office. The salesmen earn a total of $31,000 per year in commissions HELD the company has minimum contacts with Washington Ex.2 (min. contacts found): McGee v. International Life Insur. Co. D is a Texas insurance company. It does NOT solicit business in CA. However, it takes over, from a previous insurance company, a policy written on the life of X, a CA resident. D sends X a new policy; X sends premiums from his CA home to Ds out-of-state office. X dies; P (the beneficiary under the policy) is a CA resident. P sues D in CA for payment under the policy. HELD D has min. contacts w/ CA, and can thus be sued in personam there in a suit by P for payment on the policy Ex.3 (min. contacts NOT found): Hanson v. Denckla D is a DE bank, which acts as trustee of certain trust. S, the settlor of the trust, is a PA resident at the times she sets up the trust. Years later, she moves to FL. Later, her 2 children, also FL residents, want to sue D in FL for a judgment they are entitled to the remaining trust assets. D has NO other contacts with FL. HELD D does NOT have min. contacts w/ FL, and therefore CANNOT be sued in personam there  NOTE the idea is that D WILL be found to have min. contacts w/ the state ONLY IF D has purposefully availed itself of the chance to do business in the forum state. Thus in McGee, the insurance co. offered a policy to someone who it knew was a resident of the forum state. In Hanson, in contrast, the trustee NEVER voluntarily initiated business transactions with a resident of the forum state or otherwise did business in that state it was only Ss unilateral decision to move to the forum state that established any kind of connection w/ that state, so the min, contacts did NOT exist. Use of agents sometimes an out-of-state company does NOT itself conduct activities w/in the forum state, BUT uses another company as its agent in the state. Even though ALL business w/in the state is done by the agent, the principal (the foreign corp.) CAN be SUED, IF the agent does a significant amount of business on the foreign companys behalf Operation of an Internet Website that reaches in-staters in order to establish min. contacts, one must ask: did the website operator intend to target residents of the forum state? o If YES, there are probably min. contacts o If NO, there probably are NO min. contacts o Passive site that just posts info. if an out-of-state local business just passively posts info on the web, and does NOT especially want to reach in-staters or conduct transactions w/ them, this probably does NOT amount to min. contacts, EVEN IF some in-staters happen to access the site Ex: Cybersell, Inc. v. Cybersell, Inc. D operates a local jazz caf in a small town in Kansas, He puts a websites with a schedule of upcoming events, and uses a trademark belonging to P on the site. P, based in NY sues D in N.Y. federal court for trademark infringement. Even though a few New Yorkers may have accessed Ds site, this will NOT be enough to constitute min. contacts w/ NY because D wasnt trying to attract business from NY 4

o Conducting transactions w/ in-staters if D runs an e-commerce site that actively tries to get in-staters to buy stuff from the site, and some do, that probably WILL be enough to constitute min. contacts w/ the state, at least where the suit relates to the in-staters transactions.  If the web-based transactions w/ in-staters are systematic and continuous, then these contacts will be enough for jurisdiction in the state on claims NOT related to the in-state activities Claims unrelated to in-state activities All of the above law assumes that the claim relates to Ds in-state activities (so that specific jurisdiction is involved). Where the cause of action does NOT arise from the companys in-state activities (i.e., general jurisdiction is involved), greater contacts between D and the forum state are required. The in-state activities in this general-jurisdiction situation MUST be systematic and continuous Ex: Helicopteros Nacionales de Columbia v. Hall D is a South America corp. that supplies helicopter transportation in South America for oil companies. D has NO contacts w/ TX except: (1) one negotiation there w/ a client, (2) the purchase by D of 80% of its helicopter fleet from a TX supplier, (3) the sending of pilots and maintenance people to TX for training, and (4) the receipt out-of-state of 2 checks written in TX by the client. D is sued in TX by the Ps (TX residents) when they are killed in South American while being transported by D. HELD the Ps CNANOT sue D in TX. Because the Ps claims did NOT arise out of Ds in-TX activities, those TX contacts had to be systematic and continuous in order to be sufficient for jurisdiction. The contacts here were too sparse for that Products liability o Effort to market in forum state the mere fact that a product manufactured or sold by D outside of the forum state finds its way into the forum state and causes injury there is NOT ENOUGH to subject D to personal jurisdiction there.  D can be sued in the forum state ONLY IF it made some effort to market in the forum state, either directly or indirectly Ex: World Wide Volkswagen v. Woodson The Ps are injured in OK in an accident involving an allegedly defective car, they had purchased the car in NY while they were NY residents. The Ps sue in OK. D1 is the distributor of the care, who distributed only on the East Coast. D2 is the dealer, whose showroom was in NY. Neither D1 NOR D2 sold cars in OK or did any business there. HELD NETIERHY D may be sued in OK. Nether D had made efforts to serve directly or indirectly the OK market. Any connection between the Ds product in OK was merely an isolated occurrence, completely due to the unilateral activity of the Ps o Knowledge of in-state sales enough IF the out-of-state manufacturer makes or sells a product that he KNOWS will e eventually sold in the forum state, this fact by itself is probably ENOUGH to establish min. contacts  HOWEVER, if this is the only contact that exists, it may nonetheless be unreasonable to make D defend there, and thus violate due process Ex: Asahi Metal Industry Co. v. Superior Court P I injured while riding a motorcycle in CA. He brings a product liability suit in CA against, inter alia, D, the Taiwanese manufacturer who made the cycles rear inner tube. D impleads X, the Japanese manufacturer of the tubes valve assembly, claiming that X MUST pa D any amount that D has to pay P. X has NO 5

contacts with CA, except that X knew that: (1) tires made by D from Xs components were sold in the US, and (2) 20% of the US sales were in CA. the PD suit has been settled but the P-X case is to be tried HELD X HAD min. contact w/ CA because it put its goods into a stream of commerce that it knew would lead many of them to CA. BUT despite these min. contacts, it would be unreasonable and unfair and thus a violation of due process for CA to hear the case, because of the burden to X of having the to defend in CA, the slenderness of CAs interest in having the case heard there, and the foreign relations problems that would be created by hearing an indemnity suit between two foreign corps. Unreasonableness even when the min contacts exist, it will be a violation of due process for the court to heart a case against a non-resident D where it would be unreasonable for the suit to be heard. The more burdensome it is to the D to have to litigate the case in the forum state, and the slimmer the contacts (although min.) w/ the forum state, the more lily this result is to occur Suits based on contractual relationships the fact that one party to contract is a resident does NOT by itself automatically mean that the other party has min. contacts the existence of a contract is just one factor to look at o Contractual relationship involving the state where the contract itself somehow ties the parties business activities into the forum state, this will be an important factor tending to show the existence of min. contacts.  For instance, if one party is to make payments to the other, and the latter will be receiving the payments in the forum state, this stream of payments coming into the state IS LIKELY to establish min. contacts and thus to permit suit against the PAYOR. Ex: Burger King Corp. v. Rudzewicz D runs a fast food restaurant in MI under franchise from P, which ahs its headquarters in FL. The contract requires D to make royalty payments to P in FL. HELD P MAY sue D in FL. The fact that the payment stream comes into FL is an important factor, though NOT by itself dispositive, in the courts conclusion that there were min. contacts w/ FL. o Choice of law clause where there is a contract between the parties to the suit, the fact that the contract contains a choice of law clause requiring use of the forum states law will ALSO be a factor (although NOT a dispositive one) tending towards a finding of min. contacts Ex: on the facts of Burger King, the franchise contract state that FL law would be used. This was an actor helping lead the court to conclude that D had min. contacts with FL o Reasonable anticipation of D the min. contacts issue always boils down to this: Could the D have reasonably anticipated being required to litigate in the forum state?  The fact that the other party was a resident of the forum state, the fact that a stream of payments went into the forum state, and the fact that the forum states law was to be used in the contract, are ALL NON-DISPOSITIVE, BUT important, factors tending towards the conclusion that the out-of-stater HAD min. contacts with the forum state.

Libel and slander cases the 1st Amendment imposes certain limits on the substantive libel and slander laws of the states (e.g., that NO public figure may recover w/out a showing of actual malice). o BUT this special 1st Amendment protection does NOT affect the personal jurisdiction requirements for libel and slander suits NO more extensive contacts between D and the forum state MUST be shown in defamation suits than in any other type of case (Calder v. Jones)

(c) Over THINGS y Two type of actions in rem actions and quasi in rem actions o In rem actions do NOT seek to impose personal liability on anyone, BUT instead see to affect the interests of persons in a specific thing Ex: Probate court actions; admiralty actions concerning title to a ship; actions to quite title to real estate or to foreclose a lien upon it; actions for divorce  No personal liability NO judgment imposing personal liability on anyone results ALL that happens is that the status of a thing is adjudicated Ex: in a quite title action, a determination is reached that A, rather than B, is the owner of Blackacre o uasi in rem actions actions that WOULD have been in personam IF jurisdiction over Ds person had been attainable. INSTEAD property or intangibles are SEIZED NOT as the object of the litigation, BUT merely as a means of satisfying a possible judgment against D. y In rem jurisdiction o Specific performance of land sale contract even IF the D is out of state and has no connection w. the forum state other than having entered into a contract to convey in-state land, the forum state MAY hear the action. D does NOT have to have min. contacts w/ the forum state for action to proceed it is ENOUGH than the contract INVOLVED in-sate LAND, and that D has received reasonable notice o Effect of SHAFFER almost NO effect on in rem suits. Shaffer holds that there MUST be min. contacts BEFORE a quasi in rem action may proceed; BUT NO min. contacts are needed for the court to adjudicate the STATUS of property OR some other thing located in the state, even though it affects the rights of an out-of-stater y uasi in rem jurisdiction o Definition an action that WOULD have been in personam IF jurisdiction over D's person had been attainable. Property or intangibles are seized NOT as the object of the litigation, BUT merely as a MEANS of satisfying a possible judgment against D Ex: P wants to sue D on a contract claim in CA state court. The contract has NO connection w/ CA, nor does D himself have sufficient contacts w/ CA to allow that state to exercise personal jurisdiction over him. D does own a bank account in CA. Putting aside constitutional due process problems, P COULD attach that bank account as a basis of jurisdiction, and bring a quasi in rem action on the contract claim. IF P wins, he will be able to collect ONLY the value of the bank account, and D will NOT be personally liable for the remainder IF the damages exceed the value of the account o No res judicata value (a case in which there has been a final judgment and is NO longer subject
to appeal. The term is also used to refer to the doctrine meant to BAR (or PRECLUDE) relitigation of such cases between the same parties) quasi in rem NO res judicata value

Ex: if P wins against D in a quasi in rem action in CT, he CANNOT in a later suit against D in CA claim that the matter has been decided for ALL time. Instead, he MUST go through another trial on the merits IF he wishes to subject D to FURTHER liability  Possible exception IF D makes a limited appearance (an appearance that does NOT confer personal jurisdiction over him) and fully litigates certain issues, he will NOT be allowed to re-litigate those ISSUES in a subsequent trial. y BUT other courts hold that even here, the 1st suit WILL NOT prevent D from re-litigating the same ISSUES later on o Requirement of min. contacts (SHAFFER) quasi in rem jurisdiction over D CANNOT be exercised UNLESS D had such min. contacts w/ the forum state that in personam jurisdiction COULD be exercised over him. Ex: Shaffer v. Heitner P bring a shareholders derivative suit in DE on behalf of XYZ Corp. against 28 of XYZs non-resident directors and officers. None of the activities complained of took place in DE, nor did any D have any other contact w/ DE. P takes advantage of a DE statute providing that ANY stock in a DE corp. IS deemed to be present in DE, allowing that stock to be attached to provide quasi in rem jurisdiction against its owner. Thus P is able to ties up each Ds XYZ stockholdings even though there is NO other connection w/ DE HELD this use of quasi in rem jurisdiction VIOLATES constitutional due process. NO D may be subjected to quasi in rem jurisdiction UNLESS he has min. contacts w/ the forum state. Here, neither the Ds actions nor the fact that those actions related to a DE corp. were sufficient to create min. contacts, so the exercise of jurisdiction was improper o Jurisdiction based on debt, insurance or other obligation Shaffer abolishes the utility of quasi in rem jurisdiction since quasi in rem is ONLY used where there is NO personal jurisdiction, AND since the same min. contacts needed for quasi in rem WILL suffice for personal jurisdiction, quasi in rem will RARELY be advantageous  The EXCEPTION is where min. contacts ARE present, BUT the state longarm for personal jurisdiction is too narrow to reach the D, yet a state attachment statute applies  Attachment of 3rd partys debt to the D, OR attachment of an insurance co.s obligation to defend and pay a claim, are largely wiped out as bases for jurisdiction. Ex.1: Harris v. Balk Harris, of NC, owes $180 to Balk, of NC. Epstein, of MD, has claim against Balk for $300. While Harris is visiting MD, Epstein attaches Harris debt to Balk by serving Harris w/ process in a MD suit. Under PRE-Shaffer law, this established a quasi in rem jurisdiction over the $180 debt, on the theory that the debt goes wherever the debtor goes. If Epstein won, he could require Harris o pay the $180 to him rather than to Balk AFTER Shaffer, the fact that Balks debtor happened to be in NC AND available for personal service was IRRELEVANT. Since Balk himself did NOT have min. contacts w/ MD, and thus could NOT be sued there personally, Shaffer means that a quasi in rem suit based on Harris debt to him MAY also NOT be heard in MD. 8

Ex.2: same facts, except that instead of Harris being sued, Insurance Co., which had an obligation to defend Balk and pay judgments issued against Balk, was served in MD. PRE-Shaffer, this would have enough for quasi in rem jurisdiction over Balk AFTER Shaffer, the fact that Insurer had min. contacts w/ MD would be irrelevant an insurance companys obligation to defend the debtor in the forum state and to pay claims arising out of suits in the forum state is NOT enough to subject the insured to a quasi in rem suit in the forum state Limited appearance o Definition under a limited appearance, D appears in an in rem OR quasi in rem suit, contest the case on its merits, BUT is subjected to liability ONLY to the extent of the property attached or debt garnished by the court  Distinguished from special appearance in special appearances, the D against whom personal jurisdiction is asserted is allowed to argue the invalidity of that jurisdiction w/out having this argument, or his presence in the court, itself constitute a submission to the courts jurisdiction o Federal limited appearances federal courts usually follow the rule of the state in which they are sitting in determining whether to allow a limited appearance Federal quasi in rem jurisdiction o General rule quasi in rem jurisdiction IS allowed in federal courts IF Rule 4(n): (1) The law of the state in which the fed. ct. sits PERMITS such quasi in rem jurisdiction; and (2) P CANNOT obtain personal jurisdiction over D in the state through reasonable efforts Ex of conditions satisfying (2): D = fugitive, OR the local long-arm statute is too weak to reach D even though he has min. contacts w/ the state where the district court sits o Amount in controversy In fed. quasi in rem cases, courts are split as t whether it is the value of the attached property, or the amount claimed which should control for the $75,000 amount in controversy requirement

2 aspects of personal jurisdiction: Amenability (whether the state has POWER over the individual) and Notice. B. NOTICE y Notice generally EVEN if the court has authority to judge the dispute between the parties or over the property before it, the court may NOT proceed UNLESS D received adequate notice of the case against him FRCP Rule 4 (SUMMONS) a. Form: signed by clerk, bear seal of court, id court and parties b. Issuance: c. Service: i. MUST be served along WITH complaint ii. service may be affected by any non-party over 18 d. Waiver of service i. waiver of service does NOT waive jdx or venue objections. ii. duty of D to avoid unnecessary costs of service, incentives to waive service (more time, do NOT have to pay for service) 9

e. service SHOULD be pursuant to state law OR by delivering personally OR leaving at their abode with a person of suitable age or authorized agent f. service on individuals in a foreign country g. service on infants and incompetent persons h. service upon corporations and associations i. service upon US, agencies, corporations, officers, employees j. service upon foreign, state, or local govts k. territorial limits of service ABOUT AMENABILITY/(federal courts MUST apply state law under 4(k)(1)) l. proof of service m. time limit for service n. seizure of property, service NOT feasible o Reasonableness test in order for D to have received adequate notice, it is NOT necessary that he ACTUALLY have learned of the suit. RATHER, the procedure used to alert him MUS have been reasonably likely to inform him, even if they actually failed to do so Ex: Ps process server leaves the summons and complaint at Ds house, w/ Ds wife. Ds wife throws it in the garbage and D never learns of it. D HAS received adequate notice, so the court can exercise jurisdiction over him. CONVERSELY, if Ps process served had left the papers on the sidewalk outside the house, and D had happened to pick them up, this would NOT be adequate notice to D the procedures used were NOT reasonably lily to give D notice, and they re NOT saved by the fact that D in fact learned of the suit o Substitutive serviced personal service handing the papers to D himself WILL ALWAYS suffice as adequate notice. BUT ALL states, and the fed. syst., ALSO allow substitute service some form of service other than directly handing the papers to the D  Leave at dwelling (Rule 4(e)(2)) usually requires the papers to be left with an adult who is reasonably likely to give the to D  Mail (Rule 4(e)(1)) via 1st class mail. y HOWEVER, this method is allowable ONLY if D returns an acknowledgement or waiver form to Ps lawyer. y If D does NOT return the form, some other method of service MUST then be used o Service on out-of staters in a state court suit, this can ONLY be done IF the state has a long-arm statute covering the type of case and D in question.  Mail notice via registered or certified mail  Public official service may be made by serving a public official PLUS giving notice by mail to D  Newspaper publication if Ds identity or resident are unknown, some states allow service by newspaper publication. BUT this may only be used where D truly CANNOT be found by reasonable effort o Corporations  Corporate officer many states require that the corp., if it wishes to be incorporated in the state or do business in the state, MUST designate a corp. official to receive process for suits against the company. Service on this designated official is, of course, deemed to be adequate notice. 10

Federal Rule (Rule 4(h)(1)) more liberal, in that they allows service on ANY person associated w/ the corp. who is of sufficiently high placement. y Thus Rule 4(h)(1) provides that service on a corp. may be made by giving the papers to an officer, a managing OR general agent, OR to ANY other agent authorized by appointment or by law to receive service of process Constitutional due process International Shoe 14th Amendment Due Process Clause PROHIBITS jurisdiction over a D who lacks min. contacts with the forum state Mullane v. Central Hannover Bank 14th Amendment Due Process Clause PROHIBITS jurisdiction over a D who has NOT been given reasonable notice of the suit
Notice must be reasonably calculated, under all the circumstances, to apprise parties of the action and afford them opportunity to present their objections. Must be reasonably certain for inform those affected

o Mail notice to ALL the identifiable parties if a partys name and address are reasonably ascertainable, publication will NOT be sufficient, and instead notice by mail (or other means equally likely to ensure actual notice) MUST be used (Mennonite Board of Missions v. Adams) o Actual receipt does NOT count what matters is the appropriateness of the notice prescribed by statute, NOT whether D actually got the notice. Opportunity to be heard D MUST be notified of the suit against him AND MUST also be given an opportunity to be heard (BEFORE his property may be taken away, he MUST be given a chance to defend against the claim this opportunity to be heard MUST be given to D not only when his property will be taken forever, but even before there is any significant interference with hi property rights) o Pre-judgment remedy two common forms of pre-judgment remedies are the attachment of Ds bank account and the placing of lis pendens against her real estate o 3 part test the court will weigh 3 factors against each other to determine whether due process was violated when Ds property was interfered with through a prejudgment remedy: (1) the degree of harm to Ds interest from the pre-judgment remedy (2) the risk that the deprivation of Ds property rights will be erroneous (especially if the state COULD have used additional procedural safeguards against this BUT did NOT), and; (3) the strength of the interest of the party (typically P) seeking the prejudgment remedy Ex: Connecticut v. Doehr A state statute allows P to get a prejudgment attachment of Ds real estate w/out Ds having a hearing first, so long as P verifies by oath that there is probable cause to sustain his claim. Factor 1 (the strength of Ds interest) works AGAINST allowing attachment, since an attachment clouds Ds title and affects his credit rating. Factor 2 (risk if erroneous deprivation) also supports NOT ALLOWING the attachment, since the judge CANNOT accurately determine the likely outcome of the litigation based solely on Ps one-sided conclusory statements in the oath 11

Factor 3 (strength of Ps interest) also works AGAINST the attachment, since P is NOT required to show D is dissipating his assets. Consequently, the grant of prejudgment attachment of Ds property VIOLATES his due process rights C. THE HISTORICAL ROOTS y Pennoyer v. Neff o 1st case in which the Supreme Court established a constitutional LIMIT on court jurisdiction  State courts do NOT have personal jurisdiction over someone who is NOT in the state  Rationale States have sovereignty within their territory, so they most likely have authority over ALL those within the state, NOT just residents y (Requirement of notice) Milliken v. Myer o Domicile ALONE is sufficient to bring D within reach of the state. o States authority is NOT terminated by residents absence, provided there is proper notice. (Notion of reciprocal duties)  Incorporation is the corporation version of domicile

D. STATUTORY CONSTRAINTS ON PERSONAL JURISDICTION y Long arm statutes do NOT always allow for the exercise of personal jurisdiction to the full extent granted by the Due Process Clause. o Courts will often decides cases based on Long arm statutes, instead of the DP Clause  Ashwander Doctrine decide on statutory grounds before constitutional grounds

Crocker v. Hilton y Crockers, Mass. Couple, sued Hilton Barbados in Mass. Fed. court for negligence in connection with rape that occurred in Barbados. Hilton challenges personal jurisdiction. Federal court assert 2 sections of state long-arm statute: o Ch. 223A 3(a) transacting business in this commonwealth o Ch. 223A 3(d) causing tortious injury in this commonwealth if regular solicitation of business, substantial revenue in commonwealth (arising from)  Federal courts MUST apply state law under Rule 4(k)(1) (see also the section on consent for motor vehicle statutes, etc.) E. THE MODERN FRAME WORK EMERGES y y (SEE ABOVE) Two new concepts in Intl Shoe o Certain minimum contacts may suffice o BUT the obligations on which the suit is base MUST arise out of or be connected with the activities in the forum state  Minimum contacts the forum state may exercise personal jurisdiction over the corp. ONLY IF the corp. has min. contacts w/ the forum state such that 12

the maintenance of the suit does NOT offend traditional notions of fair play and substantial justice (International Shoe v. Washington) F. PROCEDURES FOR CHALLENGING JURISDICTION (a) 1880s Texas System (no state has this system now) showing up conferred personal jurisdiction. a. Only way to challenge was to default and attack collaterally (b) Special Appearance State (see chart) if you contest personal jurisdiction, you CANNOT attack collaterally. a. You have accepted the authority of the court to decide the issue. If you lose you can default on the merits and appeal jurisdiction OR try on the merits (c) Rule 12 state ALL issues (personal jurisdiction AND merits) CAN be appealed. a. But if you challenge personal jurisdiction under Rule 12, you CANNOT attack collaterally y RULE 12 o If you use Rule properly, you can challenge jurisdiction, loose, wait until the trial is over, loose, and STILL appeal BOTH issues o Rule 12 gives Ds MORE rights  Special appearance waives certain rights o Rule 12 is still better because it allows a person to DIRECTLY (vs. collateral attack) attack a judge by appealing

G. SPECIFIC JURISDICTION After 1945 y D CAN be sued on a claim that has some connection with the forum

International Shoe in cases against a non-resident, due process requires certain min. contacts w/in the state. The obligations on which the suit is based MUST arise out of or [be] connected with the activities in the forum state. McGee single life insurance policy sold in CA. Offer and payment of premiums are min. contact enough for CA to properly exercise personal jurisdiction over insurance company. Contract was substantial connection to CA. No question of relatedness claim arose out of contact in question (fundamental transformation in national economy makes it LESS burdensome for a party to be sued outside its home state) Hanson v. Denckla did trustees have min. contacts with FL to make them amenable to FL jurisdiction? NO. Activity was unilateral (does this really distinguish it from McGee?) and There MUST be some act by which the D purposefully avails itself of the privilege of conducting activities w/in the forum state, thus invoking the benefits and protections of its laws Shaffer v. Heitner DE law allows sequestering of Ds property in DE, permitting exercise of personal jurisdiction. Court holds that quasi in rem jurisdiction REQUIRES min. contacts of International Shoe in the same way personal jurisdiction does. (compare with Harris v. Balk) 13

o When property is unrelated to the claim at hand, it CANNOT be used merely to establish personal jurisdiction. Product Liability / Defective Products cause a lot of personal jurisdiction issues; everyone in the chain is liable y Foreseeability test if the manufacturer could foresee that the product would be send into the forum state there is jurisdiction. y World Wide Volkswagen foreseeability test is TOO broad. Use reasonable anticipation of being haled into court test ECONOMIC TEST: NOT an isolated sale, BUT result of an effort to serve the market for its products. Forum state does NOT exceed due process if it asserts personal jurisdiction over corporation that delivers it products into stream of commerce w/ expectation that they will be purchased by consumers in the forum state Keeton v. Hustler regular circulation of magazines in NH: (1) IS sufficient to support assertion of personal jurisdiction; and (2) establishes min. contacts. Hustler has continuously and deliberately exploited the NH market therefore, it can reasonably anticipate being haled into court there Calder v. Jones Effects Test o CAs exercise of personal jurisdiction over reporter and editor was PROPER because of the effect on CA o The conduct was targeted at CA resident and therefore, Ds could have anticipated being haled into court. o Injury was caused in CA and Ds act was calculated to do so. Pavlovich Knowledge, by itself, CANNOT establish purposeful availment under the effects test o Lack of targeting make exercise of personal jurisdiction improper  Pavlovich did NOT know DVD CCAs place of business, had never heard of trade association, did NOT intentionally target CA Burger King R could reasonably expect to be sued in FL b/c of contract provisions, contacts, amount of control, choice of law provisions. Min. contacts are in the DETAILS. Once min. contacts are established, they may be considered in light of other factors to determine if jurisdiction is w/in notions of fair play and substantial justice Asahi NO personal jurisdiction. o 2 separate analyses: 1) minimum contacts? 2) fair play and substantial justice? 1) Did Asahi serve the market? 4 justices (OConnor): awareness that product may enter market is NOT enough, D MUST have intent to purposefully avail itself of market, indicate intent to serve market 4 justices (Brennan): injecting goods into stream of commerce is sufficient to establish min. contacts 2) Exercise of personal jurisdiction offends notions of fair play and substantial justice. 14

Three part test court MUST consider: burden on D, interest of forum state, Ps interest in obtaining relief (pp. 110) y Burden here, given Asahis international status, is too great. H. GENERAL JURISDICTION D can be sued in the forum on any claim Bryant v. Finnish National Airline In some instances, corporate presence is enough to confer general jurisdiction (in this case the co. was selling) Perkins v. Benguet Mining affirmation of International Shoe dictum: if a corporation has enough contact (substantial and continuous, NOT min.) it may be sued there based on claims that are unconnected to those contacts Helicopteros v. Hall large volume of purchases is NOT enough to confer general jurisdiction, BUT general affirmation of Perkins that corporation may be sued under theory of general jurisdiction as long as there is continuous and systematic presence in forum state. (distinct from Bryant buying v. selling) Gator.com case moving towards general jurisdiction for internet sales? LL Bean was found to be subject to general jurisdiction in CA despite the fact that it lacked many of the factors traditionally associated with physical presence. Court cited its extensive marketing and sales in CA, contacts with CA vendors, and the fact that its website is structured to operate as a virtual store in CA. (This decision was appealed to en banc panel, but settled before decision) I. CONSENT Ex: motor vehicle laws consent to exercise of personal jurisdiction if you drive into a state y Pennoyer state may require the appointment of an agent for non-resident doing business in the state (usually for corporations) [pp. 66] Carnival v. Shute y Forum selection clauses distinct from choice of law clauses o Tickets had boiler plate forum selection clause on them should it be enforced? o Ability to negotiate is NOT a necessity in upholding the clause. o The clause IS permissible for several reasons:  Cruise lines have a special interest in selecting the forum because their passengers are from all over  Clause facilitates cases by saving litigation over forum (and these savings may be passed on to customers)  NO indication that the forum was selected to disadvantage P or discourage suits. y J. Stevens dissents citing concerns about free bargaining, power disparity. y If the contract did NOT have the forum selection clause, the Shutes couldve sued in: o Washington (where they bought the tickets) o California (where they got on the cruise) o Florida (where the companys headquarters are) 15

(a) NECESSITY Helicopteros v. Hall o Footnote 13 suggests that IF P had shown that all 3 Ds could NOT be sued in the same forum the court might consider exercising personal jurisdiction by necessity Shaffer o Footnote 37 is presence of property in a state a sufficient basis for jurisdiction when no other forum is available? J. TRANSIENT JURISDICTION y Transient jurisdiction helps the people within the state (usually P in these cases) and hurts non-residents

Burnham y Non-resident served in forum state. Service of process w/in the forum state IS enough to establish personal jurisdiction. 3 rationales: 1) SCALIA jurisdiction over non-residents who are physically present in the forum state is among the most firmly established principles of personal jurisdiction. Jurisdiction based on physical presence alone constitutes due process 2) BRENNAN fairness analysis a. By visiting the forum state, the D avails himself of significant benefits provided by the state: health and safety, roads, water. It is illogical (and unfair) to allow the D these benefits w/out allowing the state the benefit of exercising personal jurisdiction. 3) STEVENS no real reason given, concerned about over breath of both approaches. y Under this decision anyone can get sued by anyone else in any state as long as they are served w/in that state (regardless of whether P and D are residents of the forum state) (a) EXCEPTIONS Exception for fraud Ex: Wyman case Wyman is suing over a broken contract (oral for marriage and $$$) You should try to establish if the agreement was actually made in FL in order to tag jurisdiction Constitution does NOT prohibit fraudulent inducement Ex: if an alleged murder is kidnapped and taken to the state where he committed the crime, he can be tried and executed there (EVEN though he was kidnapped) There are several instances where people induce others into the state to negotiate; after the negotiations, they serve the opposing party and tag on the summons Some states offer immunity to tagging jurisdiction in order to get people to come to testify in OTHER cases (usually criminal, although this happens in civil cases as well) 16

If fraudulent inducement OK, is NY (in this case) required to give it full credit? y With some exceptions, the full faith and credit clause requires that NY honor the FL judgment IF it is based on valid grounds according to FL laws Then the next thing to do is to see if FL law allows fraudulent inducement y FL law is unclear o Therefore, we can use NY law o And since NY law does NOT allow this, well assume FL law will NOT allow it either IF amenability were NOT allowed via fraudulent inducement, THEN you would try to establish min. contacts to see if forum state had jurisdiction IF FL DOES have jurisdiction If you default in Florida jurisdiction and you are wrong, then judgment WOULD be enforced in NY and you are out $$$ o WITHOUT the possibility of defending on merits What sources of law might guide us to determine whether or not 2nd circuit court made the right decision: y Whole faith and credit of the constitution y Florida law y Due process clause of the constitution (1) CONSPIRACY Gudatis IF one co-conspirator is subject to personal jurisdiction, others might be as well. o Requirements are not quite clear. o Some states require that other conspirator know that he would cause harm in forum state, or intended effect in forum state, or foresee effect in forum state.  None require purposeful availment (b) REOPENING JUDGMENTS Rule 60 relief from judgment or order y (a) Clerical mistakes may be corrected by the court at any time of its own initiative or upon motion of either party. MUST be corrected BEFORE appeal. y (b) on motion and on such terms as are just, court may relieve for: 1. Mistake, inadvertence, surprise, or excusable neglect 2. Newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial (59(b)) 3. Fraud, misrepresentation, or other misconduct of adverse party 4. Judgment is void 5. Judgment has been satisfied, released, or discharged, a prior judgment upon which it is based has been reversed or otherwise vacated, or it is no longer equitable 6. Any other reason justifying relief from the operation of the judgment y Statute of Limitations 1, 2, 3 MUST be made not more than one year after judgment 17

K. FEDERAL SUBJECT MATTER JURISDICTION (a) Subject matter jurisdiction if the case is a federal case, you MUST then ask whether the court has subject matter jurisdiction. y Diversity either the case is between citizens of different states (w/ complete diversity required, so that no P is a citizen of the same state as any D) and at least $75,000 is at stake y Federal Question the case raises a federal question. Essentially, this means that the Ps right to recover stems from the Constitution, a federal treaty, or an act of Congress o There is NO min. amount required to be at stake in federal question cases (b) Diversity y Residency at time of filing is what counts, NOT at time of event. o COMPLETE diversity is required (Strawbridge v. Curtiss, 1806) y 1332 There is federal subject matter jurisdiction when that matter in controversy exceeds $75K and is between o Citizens of different states o Citizens of a state and citizens or subjects of a foreign state o Citizens of different states and in which citizens or subjects of a foreign state are additional parties o A foreign state (1603) as P and citizens of a state or different states For purposes of 1332, 1441, and 1603, an ALIEN = admitted to US for permanent residence shall be deemed a citizen of the state in which he is domiciled. For purposes of 1332 and 1441, a CORPORATION = is a citizen of ANY state in which it has incorporated and of the state in which it has its principal place of business. o In direct action against insurer, INSURER shall be deemed a citizen of that state of which the insured is a citizen, as well as where it is incorporated and has its principal place of business. Legal representatives are deemed to be citizens of the same state as those whom they represent (decedent, minor, etc)

(b)(1) How to determine residence? y Redner v. Sanders (2000) R claims to be a citizen of the United States residing in France for purposes of diversity jurisdiction with 2 Ds from NY. HELD that residence and citizenship are NOT synonymous.  No diversity jurisdiction because R is NOT a citizen of foreign state as required by 1332(a)(2). R then argues for CA as his domicile (drivers license, education, business, etc.) HELD he did NOT present enough proof. No diversity jurisdiction. y 1332(a)(3) is construed to prevent one foreign national from suing another in federal court simply by joining a US citizen on one side. 18

Saadeh v. Farouki (1997) S claims federal jurisdiction under 1332(a)(2) (citizens of a state and citizens or subjects of a foreign state). F is a permanent resident living in MD. S argues that F is deemed a citizen because he is an alien admitted to US for permanent residence. F argues that he is not a citizen of the USclaims that 1332 and the amendments made in 1998 were designed to RESTRICT fed sub matter jurisdiction, NOT expand it. Legislative history argument, bad draftingthis would allow one alien to sue another w/out a citizen of a state on either side. Court agrees with F. dismisses case. Partnerships and Unincorporated Associations are generally considered citizens of ALL the states in which they have general partners or members are domiciled. Therefore, it is hard to sue a national labor union, for example, in federal court on diversity grounds because they have members in every state.

(b)(2) Amount in controversy y Diversity only P MUST satisfy an amount in controversy requirement. In ALL diversity cases (NOT federal question cases) the amount in controversy MUST exceed $75,000 (i.e., $75,000.01) o Interest NOT included the $75,000 figure does NOT include interest or court costs y Standard of proof the party seeking to invoke fed diversity jurisdiction does NOT have to prove that the amount in controversy exceeds $75,000. All she has to show is that there is some possibility that that much is in question o Legal certainty test the claim CANNOT be dismissed for failing to meet the $75,000 requirement UNLESS it appears to legal certainty that the claim is really for less than the jurisdictional amount (St. Paul Mercury Indemnity Co. v. Red Cab) o Eventual recovery IRRELEVANT the fact that P eventually recovers far less than the jurisdictional amount does NOT itself render the verdict subject to reversal and dismissal on appeal for lack of jurisdiction  Discretion to deny costs but the federal court has discretion to deny costs to P, and EVEN to impose costs on hi, IF he recovers less than $75,000 ( 1332(b)) y Whose point of view followed the courts are split as to which partys point of view is to be considered in calculating the amount at stake. MOST courts hold that the controversy MUST be worth $75,000 to the P in order to satisfy jurisdictional amount y INJUNCTION value? 4 options: 1) determine the value of the injunction to P, 2) determine the cost of the injunction to D, 3) determine the cost or value of the injunction to the party claiming fed. jurisdiction, 4) allow jurisdiction if any of these 3 exceeds $75K (b)(3) Aggregation of claims in multi P or multi claim litigation: y Aggregation by single P If a single P has a claim in excess of $75,000, he may ADD to it ANY other claim of his against the same D, EVEN though these other claims are for less than the jurisdictional amount. o This is the doctrine of SUPPLEMENTAL JURISDICTION  No claim exceeds $75,000 even if P does NOT have ANY single claim worth MORE than $75,000, he may ADD together ALL of his claims against a single D. So long as these claims against a single D total MORE than $75,000, the amount in controversy requirement is satisfied 19

Additional Ds BUT a P who has aggregated his claims against a particular D, usually may NOT join claims against other Ds for less than the jurisdictional amount Ex: P has two claims, each for $40,000, against D1. P WILL be deemed to meet the amount in controversy requirement as to these claims, because they aggregate more than $75,000. BUT if P tries to bring D2 into the lawsuit, and has a single claim worth $40,000 against D2, most courts will NOT allow this claim, because Ps total claims against D2 do NOT exceed $75,000, and the doctrine of supplemental jurisdiction does NOT apply o Aggregation by multiple Ps in suits involving multiple Ps, where NOT ALL Ps meet the jurisdictional amount, there are 2 analytically different cases:  @ least one P meets amount if @ least one P meets the amount, other Ps may join their related claims against the same D. (this is a result of supplemental jurisdiction Ex: Exxon Mobil Corp. V. Allapattah SUPPLEMENTAL JURISDICTION  No single claim meets the amount if NO single P has a claim or claims meeting the jurisdictional amount, aggregation is normally NOT allowed. HOWEVER, an EXCEPTION is made where two or more Ps unite to enforce a single title or right in which they have common and undivided interest  Special rule for class actions in diversity-based class action, as long as ONE named member of the class meets the $75,000 requirement, the others do NOT have to do so (they get the benefit of supplemental jurisdiction for an amount-in-controversy purpose) (b)(4) Counterclaims y Suit initially brought in federal court if P sues in federal court for less than the jurisdictional amount, and D counterclaims for an amount which exceeds the jurisdictional amount, probably the amount in controversy is NOT met y Removal by D if P originally sues in state court for less than $75,000, and D tries to remove to federal court, amount in controversy problems work as follows: o P removal the P may NEVER remove, EVEN if D counterclaims against him for more than $75,000 (the removal statute simply does NOT apply to Ps apart from amount in controversy problems  D removal If D counterclaims for more than $75,000, but Ps original claim was for less than $75,000, the result depends on the type of counterclaim. y If Ds counterclaim was permissive (under state law), ALL courts agree that D may NOT remove y If Ds claim was compulsory under state law, courts are split about whether D may remove (c) Federal question under 1331, the fed courts have jurisdiction over ALL civil actions arising under the Constitution, laws, or treaties of the United States y Federal claim there is NO precise definition of a case arising under the Constitution or laws of the United States. BUT in the vase majority of cases, the reason there is a federal question is that federal law is the source of the Ps claim

20

Ex: a claim of copyright infringement, trademark infringement, or patent infringement raises a federal question, because in each of these situations, a federal statute is the source of the right the P is asserting o Interpretation of federal law it is NOT enough that P is asserting a state-created claim which requires interpretation of federal law Ex: Merrell Dow Pharmaceuticals, Inc. v. Thompson P brings a state court product liability suit against D for injuries sustained by taking a drug made by D. P claims that D violated the federal FDA statute by mislabeling the drug, and that this mislabeling automatically constitutes commonlaw negligence. D wants to remove to federal court, so it claims that the case is w/in federal question jurisdiction, because its disposition requires interpretation of a federal statute HELD NO federal question is raised, because Ps claim did NOT arise under federal law o Claim based on the merits if Ps claim clearly rises under federal law, it qualifies for federal question jurisdiction even if the claim is invalid on the merits  HERE, the federal court MUST dismiss for failure to state a claim upon which relief may be granted (Rule 12(b)(6), NOT for lack of subject matter jurisdiction) o Anticipation of defense the fed question MUST be integral to Ps cause of action, as revealed by Ps complaint. It does NOT suffice for fed question jurisdiction that P anticipates a defense based no a federal statute (RIPE), OR even that Ds answer does in fact raise a federal question (RIPE). The federal question MUST be part of a well pleaded complaint Ex: Louisville & Nashville RR v. Mottley P claims that D RR has breached its agreement to give P free RR passes. A recently-passed federal statute prohibits the giving of such passes. In Ps complaint, he anticipates the RRs federal statutory defense, claiming that the statute violates the 5th Amendment HELD since Ps claim was merely a breach of contract claim, AND the federal statute was NOT essential to that claim, there was NO federal question the fact that federal law was an integral part of Ds anticipated defense is IRRELEVANT (SC dismissed for lack of subject matter jurisdiction because the ORIGINAL cause of action did NOT arise under the Constitution, but under performance of the contract) y y Other cases: Smith v. Kansas City Title & Trust Co. (1921) S alleged that the bank had violated state law by investing in illegal securities (bonds issued by a federal agency under a federal law the S claimed was unconstitutional). HELD SC found federal question jurisdiction T.B. Harris Co. v. Eliscu (1964) Issue was NOT whether the copyright had been infringed (fed question), but whether the owner of the copyright had assigned it to another (property and contract state law). A suit arises under the law that creates the action, but federal law MAY govern what may seem like a state issue IF the federal interest is dominant

(See pp 186-189 for challenging subject matter jurisdiction) y Ex: Rule 12(b)(1); Rule 12(b)(6), etc 21

L. SUPPLEMENTAL JURISDICTION (pendant and ancillary) y Supplemental jurisdiction (1367) suppose new parties or new claims are sought to be added to a basic controversy that by itself satisfies federal subject matter jurisdictional requirements. Under the doctrine of supplemental jurisdiction, the new parties and new claims may NOT have to independently satisfy subject-matter jurisdiction they can in fact be tacked on to the core controversy Pendant and Ancillary doctrines REPLACED supp. jurisdiction REPLACES these Pendant v. Ancillary Pre-1990 doctrines to PERMIT the efficient adjudication, in one case, of claims that were closely related, but NOT explicitly authorized to have federal subject matter jurisdiction under 1331 OR 1332. o Pendant federal courts power to hear a claim based on state law that involved the same facts as a federal claim being asserted by the P in the same case o Ancillary federal courts power to hear claims by a D (counterclaims, claims against 3rd parties) arising out of the same facts as the Ps (fed. jurisdiction.) claims against the D Ex.1: Gibbs Sued miners union over federal labor law, joined a claim under TN conspiracy law. Could NOT invoke diversity jurisdiction b/c union had members in every state, including TN. HELD Lower court found that union did NOT violate fed law, dismissed that claim, but allowed G to continue in federal court on state claim (exercising pendent jurisdiction because claim arose from same nucleus of factsarticle 3 of Const. allows jurisdiction to extend that far) Ex.2: Finley v. United States (1989) Threatened the validity of supplemental jurisdiction doctrines that were not codified. Led to the passage of 1367. Plane crash in CA. F sues US under Federal Tort Claims Act which provides for exclusive federal jurisdiction. Tried to join claim against power company (CA resident) HELD SC refused; F had to bring 2 claims, 1 in state court, 1 in federal court. 1367 supplemental jurisdiction (enacted in 1990 in order to codify this case law) y Except as provided in (b) and (c), or by federal statute, in any civil action of which the district courts have original jurisdiction, they shall have supplemental jurisdiction over ALL other claims that are so related to claims in the action w/in such original jurisdiction that they form part of the same case or controversy o Includes (some) claims that involved joinder or intervention of additional parties. Ex: Ps husband is killed when their small plane hits power lines near an airfield. P sues D1 (the US) in federal court, under the federal tort claims act, for failing to provide adequate runway lights. Then P amends her complaint to include state-law tort claims against D2 and D3 (a city and a private co.) who maintain the power lines. There is NO diversity of citizenship between P and D2 and D3, and NO federal question claim against them. BUT because Ps state-law claim against D2 and D3 arise from the same chain of events as Ps federal claim against D1, P may ring D2 and D3 into the suit under the supplemental jurisdiction concept, AND the last sentence of 1367(a) (OVERRULES Finley case) 22

y y

In cases founded solely on diversity of citizenship, district courts do NOT have supplemental jurisdiction over claims made by Ps against persons made parties under Rules 14 (3rd party practice), 19 (joinder), 20 (permissive joinder), 24 (intervention) when exercising supplemental jurisdiction over such claims would be inconsistent with jurisdictional requirements of 1332 District courts may DECLINE supplemental jurisdiction if: y the claim raises a novel or complex issue of state law y the claim substantially predominates over the claim over which the district court had original jurisdiction y the district court has dismissed ALL claims over which is has original jurisdiction y in exceptional circumstances, there are other compelling reasons for declining jurisdiction Period of limitations shall be tolled while the claim (under (a)) is pending and for 30 days after it is dismissed

Jin v. Ministry of State Security (2003) Falun Gong case. RICO claims (federal law) and slander, defamation claims (state law). Ds challenge supplemental jurisdiction, claiming that RICO is very different from libel and that the issues are too complex. Court decides that the claims arise from a common nucleus of operative facts and that because Ps would ordinarily be expected to try them in one proceeding, there IS supplemental jurisdiction. Additionally, economy, convenience, and fairness SUPPORT exercise of supplemental jurisdiction. While the choice-of-law issues would be time-consuming, they are NOT so complex that supplemental jurisdiction MUST be denied. NOTE where supp. jurisdiction applies, probably venue requirements do NOT have to be satisfied w/ respect to the new party. (Usually, venue will NOT be a problem in these situations) M. REMOVAL 1441 Actions Removable Generally y ANY action may be removed by the D to the district court for the district and division where such action is pending. y Federal question claims are ALWAYS removable. o Other claims (diversity) are ONLY removable IF none of the Ds are citizens of the state in which the action was brought. y When Federal question claim is joined with non-removable claims, the entire case may be removed. District court may decide all matters or may remand matters in which state law predominates. y ANY civil action brought in state court against a foreign state (1603(a)) may be removed BY the foreign state. Upon removal, case is tried w/out a jury. o Time limitations in 1446(b) may be enlarged for cause shown y Removal of 1369 claims y Court is NOT precluded from hearing and determining any claim because the state court from which the civil action was removed did NOT have jurisdiction over that claim. 23

1446 Procedure for Removal 1447 Procedure after removal generally

VENUE y Definition refers to the place w/in a sovereign jurisdiction in which a given action is to be brought. It matters only IF jurisdiction over the parties has been established Ex: State X is found to have jurisdiction over the person of B, in suit against him by A. Venue determines in which county or district of state X the case should be tried) o Cases that are removed from state court to federal court are NOT brought in federal court w/in the meaning of 1391, and are therefore NOT subject to federal venue requirements State action venue is determined by statute in state trials. The states are free to set up venue rules as they see fit (w/out having to worry about the Fed Constitution) o Basis for venue IS authorized based on the country or city where the D resides. It could be based on where the cause of action arose, where the D does business, etc. o Forum non conveniens the state may use its discretion NOT to hear the case in a county where there is statutory venue. (SEE BELOW FORUM NON CONVENIENS) Venue in federal actions 1391 which federal district court shall try the action? o Still need personal jurisdiction venue is NOT a substitute for personal jurisdiction: the fact that venues lies in a particular judicial district does NOT automatically meant that suit can be brought there. Suit can be brought ONLY in a district that satisfies both the venue and the personal jurisdiction requirements as to ALL Ds o Three methods in which there might be venue in a particular judicial district: y If ANY D resides in that district, AND ALL Ds reside in the state containing that district y If a substantial part of the events . . . giving rise to the claim occurred, OR a substantial part of property that is the subject of the action is situated in the district y If at least ONE D is reachable in the district, and NO other district qualifies. (1) Ds residence venue for both diversity and federal question cases, venue lies in ANY district where ANY D resides, so long as if there is more than ONE D, ALL the Ds reside in the state containing that district Ex: P, from MA, brings a diversity suit against D1 from S.D.N.Y, and D2 from the E.D.N.Y. Venue will like in either the SDNY or the EDNY each of these is home to at least on D, and each of these two districts is in a state that is home to ALL the Ds. BUT if D2 had been resident of the District of CT instead of ANY NY district, there would NOT be any Ds residence venue anywhere (2) Place of events or property venue for both diversity and federal question cases, venue lies in ANY district in which a substantial part of the events (or omissions) giving rise to the claim occurred, or a substantial part of property that is subject to the actions is situated this is place of events venue 24

o Multiple districts there can be multiple districts qualifying for the place of events venue, as long as ea. district was the locus for a substantial part of the events (or omissions) relating to the claim Ex: P, from MA sues D, a car dealer from CT. P alleges that D sold P a car in CT, that P drove the car to MA, and that a defect in the case caused P to be injured in MA.. Probably venue in EITHER the District of MA OR the District of CT would be allowed under the place of events provision, since probably both the selling of the defective car and the incurring of the accident were substantial part of the events. (3) Escape hatch provision for both diversity and federal question cases, there is an escape hatch by which venue MAY be founded in a district w/which some or ALL Ds have close ties, IF there is NO district in which the action may otherwise be brought. This escape hatch is used mainly for cases in which nearly ALL the events occurred abroad  Diversity 1391(a)(3) the escape hatch gives venue in ANY judicial district in which ANY D is subject to personal jurisdiction at the time the action is commenced, IF there is NO district in which the action may otherwise be brought Ex: P from MA, brings a diversity suit against D1 from SDNY and D2 from District of CT. Ps suit is brought in the SDNY. The suit relates solely to matters which occurred in Mexico. The escape hatch APPLIES even though there is NO Ds residence venue OR place of events venue in SDNY; the escape hatch works because at least on D (D1) is subject to personal jurisdiction in SDNY by virtue of his residence there. The escape hatch works ONLY because there is NO OTHER DISTRICT where the suit could have been brought *** There still has to be personal jurisdiction over EACH D. So D2 will have to have min. contacts w/ the NY, and be reachable under the NY long-arm  Federal question cases 1391(b)(3) the escape hatch gives venue in any judicial district in which ANY D may be found, IF there is NO district in which the action may otherwise be brought o NO P residence venue there is NO venue based on Ps residence o Corporation the residence of a corp. for venue purposes matters ONLY IF the corp. is a D. A corp. is deemed to be a resident of any district as to which the corp. would have the min. contacts necessary to support personal jurisdiction IF that district were a separate state. Thus the corp. is a resident of: y At least the district where it has its principal place of business y ANY district in it has substantial operations y Probably ANY district in its state of incorporation BUT, merely because a corp. does business somewhere in the state, this does NOT make it a resident of ALL districts of that state. Ex: XYZ Corp. is incorporated in DE, and has its only office in SF. XYZ has NO contacts w/ any part of CA other than SF. If XYZ is a D, it will reside, for venue purposes, in the District of DE and in the N.D. of CA. XYZ is NOT a resident of ANY other districts in CA thus Ds residence venue would NOT lie against XYZ, for instance, in a suit brought in the C.D. of CA, located in Los Angeles. 25

o Removal 1441(a) a case removed from state to federal court passes to the district court for the district and division embracing the place where such action is pending 1391(a) Diversity of Citizenship claims may be brought ONLY o In a judicial district where any D resides, if all Ds reside in the same state o In a judicial district in which a substantial part of the events giving rise to the claim occurred, or property is situated o In a judicial district where D is subject to personal jurisdiction, if there is NO other district where the action can be brought 1391(b) Federal Question claims (not solely div. of cit.) may be brought ONLY o In a judicial district where any D resides, if all Ds reside in same state o In a judicial district in which a substantial part of the events occurred, or property is situated o In a judicial district in which any D may be found, if NO other district where the action can be brought 1391(c) Residence of Corporation o Corporation is deemed to reside in ANY judicial district in which it is subject to personal jurisdiction. 1391(d) Alien Ds may be sued in any district. o 1391(b) MUST be evaluated FIRST, w/out regard to alien Ds, THEN apply 1391(d). 1391(e) 1391(f) 1391(g) D is an officer or employee of US Action against a foreign state Jurisdiction based upon 1369

A. FORUM NON CONVENIENS (a) STATE y Forum non conveniens the state may use its discretion NOT to hear the case in a county where there is statutory venue. Sometimes, this involves shifting the case to a different place w/in the state. At other times, it involves the state NOT having the case take place in-state at all. Usually, it is the D who moves to have the case dismissed or transferred for FNC o Factors state courts consider in deciding whether to dismiss for FNC: 1. Whether the P is a state resident 2. Whether the witnesses and sources of proof are MORE available in a different state or county 3. Whether the forums own state law will govern the action (transfers is more likely if a different states law controls) (b) FEDERAL y Federal forum non conveniens when a D successfully moves for FNC, the original court transfers the case to another district, rather than dismissing it.

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Under 1406(a), for the convenience of parties and witnesses a district court may transfer ANY civil action to any other district or division where it might have been brought y Ds motion Usually it is the D who moves for FNC. When it happens, the case may be transferred ONLY to a district where P would have had the right, independent of the wishes of D, to bring the action y Choice of law when the federal FNC is granted, the state law of the transferor court is to be applied by the transferee court Ex: Ferens v. John Deere Co. P brings a diversity action against D in Mississippi federal court. That court grants Ds motion to have the case moved to PA District Court. IF, as is likely, Mississippi federal court would have applied Mississippi stat law rather than PA state law under ERIE principles, the PA federal court MUST also apply Mississippi law

Piper Aircraft v. Reyno (1981) Plane crash in Scotland, decedents are Scottish, pilot was Scottish, next of kind are Scottish. Plane and propellers were manufactured in US. Wrongful death action commenced by lawyers secretary as administratrix of estates. Ds first removed to CA federal court, then transferred to PA on grounds of convenience, then move for dismissal on grounds of FNC. Presumption in favor of Ps forum choice, BUT: o Factors to consider (pp. 166, n6): o Private interest factors (affecting the convenience of the litigants): o Relative ease of access to sources of proof o Availability of compulsory process for attendance of unwilling, and the cost of obtaining attendance of willing, witnesses o Possibility of view of premises, if view would be appropriate to the action o All other practical problems that make trial of case easy, expeditious, and inexpensive o Public interest factors (affecting he convenience of the forum): o Administrative difficulties flowing from court congestion o Local interest in having local controversies decided at home o Interest in having the trial of a diversity case in a forum that is at home with the law that must govern the action o Avoidance of unnecessary problems in conflict of laws or in the application of foreign law and the unfairness of burdening citizens in an unrelated forum with jury duty.

Ps CANNOT defeat a FNC motion by showing that the substantive law that would be applied in the alternative forum is less favorable. The possibility of a change in substantive law should ordinarily NOT be given conclusive or even substantial weight in the inquiry. BUT IF the remedy provided by the alternative forum is so clearly inadequate or unsatisfactory that it is NOT remedy at all, the unfavorable change in law may be given substantial weight y When you challenge a case on the grounds of FNC you are conceding jurisdiction to the forum to which you are transferred. 27

y y

Court requires that you waive objections to personal jurisdiction in the forum in which the case is transferred. THEORY OF CONSENT Sometimes the court ALSO requires a waiver of the statute of limitations. (footnote 25, p 173 about American-style discovery) o Some courts will even go so far as to require Ds to concede liability (most cases that are dismissed from US courts under FNC are NOT brought abroad. Therefore, many lower courts impose high burdens on Ds to get a dismissal.) Appellate courts tend to be very deferential to trial courts opinions on FNC o Zone of reasonableness if it would be reasonable to go either way, appellate court will usually defer.

B. TRANSFER y 1404 allows transfer from one district to another where it could have been brought in the first place (this is at the discretion of the judge) Applies ONLY to transfers from one federal district to another. o Like FNC in that the factors to consider are similar and the movant can be required to agree to certain conditions. o But the case is transferred, rather than dismissed, so NO statutory limitations, do NOT have to re-serve Ds, etc. o 1404(a) Federal courts have the ability to move cases w/in the system, w/out dismissal and refilling. Van Dusen doctrine in diversity cases in which a D moves to transfer a case from one district to another (1404) the law of the state of the transferor applies in the transferee state. o D CANNOT transfer to obtain different/better law. o Ferens v. John Deere Co.  S.C. extends Van Dusen doctrine to apply EVEN IF the P moves for transfer 1406 when a case is filed in the wrong venue, the judge can dismiss entirely OR transfer to correct venue. o If this occurs (either under 1406 OR 1631 lack of personal jurisdiction) the law of the transferee state applies (OPPOSITE of Van Dusen doctrine) 1407 multidistrict litigation (pp. 173) o Limited to pretrial stage o Purpose = efficiency via consolidation

THE ERIE DOCTRINE y y Forum shopping to prevent forum shopping, the courts generally apply state law in diversity cases. Rules of Decision Act ( 1652) based on the Supremacy Clause, this Act is the main statute stating when the federal court SHOULD apply federal law, and when it SHOULD apply state law o Federal law applied the federal constitution, treaties, and constitutional statutes enacted by congress, ALWAYS take precedence, where relevant, over ALL state provisions 28

o State statutes in the absence of a federal constitutional or statutory provision on point, the fed courts MUST follow state constitutions AND statutes o Despite about common law what should the federal court follow where was is at issue is common OR judge made law (no controlling constitutional or statutory provision)? Ex: P sues D in a diversity action arising out of an automobile accident that took place in KS. The KS courts apply common-law contributory negligence. Must the federal judge hearing the case apply KSs common-law contributory negligence, or is the court free to make its OWN determination that comparative negligence is a sounder principle? The answer is that KS common law MUST be followed Erie v. Tompkins federal courts MUST apply the law of the several states, except where the constitution or acts of congress otherwise require. (this applies to state common-law as well as state statutory law. o Net result in diversity cases, the federal courts MUST apply state judge-made law on any substantive issue o Discrimination against citizens the contrary rule that had been followed before Erie  Swift v. Tyson which held that federal judges could IGNORE state common law in diversity cases which allowed non-citizens to discriminate against citizens of he state where the federal court sat Ex: P from OH sues D from KS in federal court for the District of KS. KS law would be favorable to D. Swift, which would allow P to choose federal or state court in KS, which ever was more favorable to him., would thus allow P to profit at Ds expense. Erie, by forcing the federal court to apply to KS law, guarantees D, the KS citizen, the benefits of his own states laws

(a) Historical Evolution y Swift v. Tyson (1841) SC held that NY state substantive case law regarding defenses that could be raised concerning bills of exchange were NOT part of the laws of state and therefore, were NOT binding of federal courts. In cases of unwritten law, federal judges could find right principles of law on their own, just as state judges could. They do NOT have to follow state judges answers. y Erie RR. V. Tompkins (1938) Question was what duty the RR had to trespassers. Under PA law, RR was only liable for wanton negligence (which was unlikely to be found), but the judge, relying on Swift, instructed the jury on the general law regarding ordinary negligence.  SC OVERRULES Swift and says that PA law must be applied: 1) Swift doctrine allows for law-shopping like in the taxi cab case. 2) Swift doctrine did NOT bring about the benefits it was expected to. State courts did NOT abandon their own opinions as expected and therefore uniformity did NOT result. Doctrine is also pernicious in that it was discriminatory towards in-state parties because it made the law vary according to whether the case was in STATE or FEDERAL court. 3) EXCEPT in matters governed by the Federal Constitution or by Acts of Congress, the law to be applied in any case is the law of the State. And whether 29

the law of the State shall be declared by its Legislature in a statute or by its highest court in a decision is not a matter of federal concern. There is NO federal general common law. y Guaranty Trust Co. v. York (1945) Involved a NY common law doctrine: laches, similar to statutes of limitations. Generally, these doctrines were viewed as procedural, but SC held that regardless of whether it was procedural or substantive Erie doctrine applied (i.e. too late to file in state court = too late to file in federal court). Opinion said that the outcome of the litigation in the federal court should be substantially the same, so far as legal rules determine the outcome of a litigation, as it would be if tried in a State court. outcome-determinative test Ragan v. Merchants Transfer & Warehouse Co. (1949) State law determines when an action was commenced for purposes of statute of limitations Cohen v. Beneficial Indus. Loan Corp. (1949) Fed court MUST apply state statute allowing a corporation to require P to post bond for the expenses of defense of a shareholders derivative suit. Bernhardt v. Polygraphic Co. of America (1956) State law concerning the enforceability of arbitration agreements SHOULD control (narrowly construed the federal arbitration statute) Woods v. Interstate Realty Co. (1949) State statute closing courts to out-of-state corporations that had NOT paid taxes ALSO closed federal courts. Byrd v. Blue Ridge Rural Electric Cooperative (1958) Issue was whether same work issue of a workers comp case should be decided by a judge (state practice) or jury (federal practice). This issue is NOT necessarily outcome-determinative because there is NO way of knowing which decision either will make. Court balances the interests to determine which practice should apply. There is a weak state interest, but a strong federal policy in favor of jury trials (and uniformity, desire to have a rule book?) Hanna v. Plumer (1965) P served D according to Rule 4 of FRCP. D got notice of lawsuit, but moved to dismiss for improper service because Mass law required executors to be served personally. SC holds that FRCP should apply because it is valid under the Rules Enabling Act. o Twin aims of Erie DISCOURAGEMENT of forum-shopping and avoidance of inequitable administration of laws. o Court can only choose NOT to apply federal rule IF rule violates Rules Enabling Act or the Constitution. o What if there is no federal rule? the importance of a state rule in indeed RELEVANT, but ONLY IF application of the rule would make so important a difference to the character or result of the litigation that failure to enforce it would 30

unfairly discriminate against citizens of the forum state, OR IF application of the rule would have so important an effect upon the fortunes of one or both of the litigants that failure to enforce it would be likely to cause a P to choose the federal court y Walker v. Armco Steel Corp. (1980) Determination of when an action is commenced for the purpose of tolling the state statute of limitations. State law (service MUST be w/in 60 days of filing) OR Rule 3? o SC says this case is indistinguishable from Ragan.  There is NO indication that there is a direct conflict between state rule and federal rule  Federal rule is NOT necessarily intended to toll the statute of limitations; it could have other purposes: order, time for requesting jury, measure of domicile for diversity claims? 1652 Rules of Decision Act o The laws of the several states, except where the Constitution or treaties of the United States or Acts of Congress otherwise require, or provide, shall be regarded as rules of decision in civil actions in the courts of the United States, in cases where they apply. 2072 Rules Enabling Act (a) The SC shall have the power to prescribe general rules of practice and procedure and rules of evidence for cases in the United States district courts and courts of appeals. (b) Such rules shall NOT abridge, enlarge or modify any substantive right. ALL laws in conflict with such rules shall be of NO further force or effect. 2073, 2074 are procedures for prescribing rules

Rules to follow (see Chart ***): y y Make sure the federal rule is really in conflict with the state rule. In absence of REAL conflict, follow the state rule Figure out the basis for the federal practice. o Statute. Constitutionally valid? Yes = federal rule, No = state rule o Rule. Valid under Rules Enabling Act? Yes = federal rule, No = state rule o Mere Practice.  Some circuits simply determine the extend to which is violates (or upholds) the twin aims of Erie, that is discouraging forum-shopping and avoiding discrimination against citizens  Some circuits apply a Byrd balancing test and weighing federal v. state interest in ADDITION to examining the twin aims of Erie.

REMEDIES y Rule 64 Seizure of Person or Property

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Rule 65 Injunctions o Preliminary Injunctions  Notice MUST be given to adverse party  Consolidation of hearing with trial on the merits o Temporary Restraining Order may be granted W/OUT NOTICE if  It clearly appears from specific facts that immediate and irreparable injury, loss, or damage will result to the applicant before the adverse party or atty can be heard in opposition  Applicants atty certifies the efforts to give notice and reasons why notice should NOT be required  TRO will expire w/in such time AFTER entry NOT to exceed 10 days, UNLESS extended for good cause  NO restraining order OR preliminary injunction shall issue EXCEPT upon giving of security by the applicant for the payment of such cost and damages as may be incurred or suffered by any party who is found to have been wrongfully enjoined or restrained.

Schiavo (2005) Ps have established irreparable harm will be suffered and the threatened injury outweighs any damage the proposed injunction could cause. y But they have NOT established substantial likelihood of success on the merits (likely or probable, rather than CERTAIN, success) y Substitutionary Remedies o Compensatory Damages  Mental injuries y Law is still evolving y Ex: Zone of mental injury (biting down on glass in restaurant but not actually cutting yourself you are in the zone of mental injury) o Liquidated, Statutory, and Punitive Damages  Punitive damages y Unbridled power to juries (i.e., non-supporters) y Where the negligence was willful and gross courts have allowed a certain amount of punitive damages y The S.C. ordinarily single digit multipliers should be the limit for punitive damages

State Farm Mutual Automobile Insurance Co. v. Campbell y Specific Remedies

PLEADINGS A. COMPLAINTS y Rule 1 FRCP govern procedure in US district courts in ALL suits of civil nature (EXCEPTIONS in Rule 81). 32

o PURPOSE of FRCP They shall be construed and administered to secure the just, speedy, and inexpensive determination of justice. y y Rule 2 one form of action, known as civil action

Rule 7 Pleadings and Motions (a) Pleadings complaint and answer, reply to counterclaim, answer to cross-claim, 3rd party complaint, 3rd party answer. No other pleading allowed, except that court may order a reply to an answer or 3rd party answer. (b) Motions, etc applications for orders shall be made by motion, MUST state grounds therefore and set forth relief sought Rule 8 General Rules of Pleading (a) Claims for Relief short and plain statement of grounds upon which courts jurisdiction depends, short and plain statement showing pleader is entitled to relief, demand for judgment for relief (b) Defenses state partys defenses, admit or deny averments upon which adverse party relies. If NO knowledge, party MUST so state. (c) Affirmative Defenses party shall set forth affirmative defenses (listed). When defense is mistakenly designated as a counterclaim or counterclaim as defense, if justice so requires, the court may treat the pleading as though there had been PROPER designation. (d) Failure to Deny averments NOT denied (other than amount of damages) are deemed to have been admitted when responsive pleading is required. When NO responsive pleading is required, they will be deemed denied to avoided. (e) A party may set out two of more statements of claim or defense (alternatively or hypothetically). (f) All pleadings shall be so construed as to do substantial justice.. Rule 9 Pleading Special Matters o 9(b) & 9(g) (fraud, mistake, special damages) require more specificity than 8(a) o Averments of time and place are material Rule 10 Form of Pleadings

y Rule 11 Signing on Pleadings, representations to the court, Sanctions (a) ALL pleadings MUST be signed by attorney with name, address, phone # (b) By presenting pleading, motion, or other paper, signed certifies that (after reasonable inquiry) (1) It is NOT presented for improper purposes (harass, delay, needless increase in cost of litigation) (2) Claims, defenses, and contentions are warranted by existing law OR nonfrivolous argument for the extension, modification, or reversal of existing law or establishment of new law (3) Allegations and factual contentions have evidentiary support (or are likely to have evidentiary support AFTER discovery of investigation) (4) Denials of factual contentions are warranted on the evidence or reasonably based on lack of information or belief. 33

(c) If court determines that (b) has been violated, the court may impose sanctions. Sanctions are limited to what is sufficient to deter such conduct. y Burden of Pleading (see also Burden of Production and Burden of Persuasion) o One MUST allege the element in the pleading or defense one CANNOT expect the other party to do so. Ex: Gomez v. Toledo (1980) Question is whether P MUST allege that an official (whose position might entitle him to qualified immunity) acted in bad faith, OR MUST the D plead this as an affirmative defense? HELD D has this burden b/c the nature of the qualified immunity defense is such that it depends on facts peculiarly w/in the knowledge and control of the D B. RESPONSES Rule 12 (a) D shall serve an answer w/in 20 days of being served, w/in 60 days of request for waiver. o Party served with cross-claim shall answer 20 days after being served. o P shall serve reply to counterclaim 20 days after service of answer o See other provisions about US employees, request for more definite statement (b) EVERY defense, in law or fact, to a claim for relief in any pleading, whether a claim, counterclaim, cross-claim, or third-party claim, shall be asserted in the responsive pleading thereto, EXCEPT that the following defenses may be made by [pre-answer] motion: 1. lack of subject matter jurisdiction 2. lack of personal jurisdiction 3. improper venue 4. insufficiency of process 5. insufficient service of process 6. failure to state a claim upon which relief can be granted 7. failure to join a party under Rule 19 (c) Motion for Judgment on the pleadings (d) Preliminary Hearings defenses (b)(1)-(7) AND (c) (e) Motion for a More Definite Statement if the pleading is so vague or ambiguous that a party cannot be reasonably required to frame a responsive pleading, the party may move for a more definite statement, pointing out the defects (f) Motion to Strike upon timely motion, the court may order stricken from any pleading, any insufficient defense or any redundant, immaterial, impertinent, or scandalous matter (g) Consolidation of Defenses in Motion motions under this rule may be joined with any other motions available and provided for under the rule. If a defense or objection is omitted from a motion, the party shall NOT thereafter make a motion based on this defense EXCEPT as provided in (h)(2) or (3). [NOTE: 12(g) applies to objections as well as defenses. This includes 12(e)] (h) Waiver or Preservation of Certain Defenses 1. A defense of: lack of personal jurisdiction (2), improper venue (3), insufficiency of process (4), OR insufficiency of service of process (5) is WAIVED if OMITTED from motion or was never made or included by amendment as a matter of course 34

2. A defense of: failure to state a claim (6), failure to join indispensable party (7), OBJECTION of failure to state a legal defense may be made in any pleading permitted under 7(a) or by motion for judgment on the pleadings, or at the trial on the merits. y Pre-Answer Motion Rule 12(b) o Permits certain defenses to be raised in a pre-answer motion o Motion, notice of motion, affidavits (if any), memorandum, proposed order (optional) Answer D MUST respond to complaints factual allegations o Denials Rule 8 (be wary of general denialsthis may get you Rule 11 sanctions!) Ex: Zielinski v. Philadelphia Piers, Inc. (1956) PPI denied the whole of the complaint that said that it owned, operated, and controlled the forklift that hit the P. PPI intended to deny negligence, but denied whole paragraph. HELD the answer MUST make it clear to the P the defenses he must be prepared to meet. Court says that PPI MUST be estopped from denying agency because its failure to correct its inaccurate statements (which it had the means of knowing were inaccurate) deprived P of right to action. o Affirmative Defenses see Rule 8(c)  Where is the division between a denial and an affirmative defense? Ex: Layman v. Southwestern Bell Telephone Co. (1977) P brought an action for trespass. D thought it had an easement. D only denied trespass, did not plead easement affirmatively. If the D has a defense in the nature of a confession of the facts of the Ps petition but avers that the Ps theory of liability does NOT apply to it because of additional facts then such a defense MUST be set forth in his answer. (Test is whether D intends to rest his case upon a fact NOT included in the allegations)  see pp. 398-400 for special cases of affirmative defenses. Reply o Rule 7(a) required a reply ONLY IF the answer contains a counterclaim (that is denominated as such). UNLESS the court also orders a reply on its own.

C. AMENDMENTS Rule 15 y 15(a) A party may amend a pleading as a matter of course ANY TIME BEFORE the responsive pleading is served or 20 days after initial pleading is served IF NO response is required. Otherwise, a party may amend ONLY by written consent of adverse party or leave of court, which shall be freely given when justice so requires. Beeck v. Aquaslide N Dive Corp. (1977) P sued D, claiming they manufactured the slide involved in his accident. D initially admitted to manufacture, but later moved to amend its answer to deny manufacture. Motion was granted. Court must now determine if P is prejudiced if the amendment is allowed. Court determines that D did NOT act in bad faith (relied on insurance reports). y 15(b) Amendments to conform to the evidence 35

o Automatic amendment UNLESS other side objects. If there is an objection, party offering evidence can move to amend. 15(c) Relation back of Amendments o Amendments after the statute of limitations has run to add a new claim or new D treat the amended pleading as though it were filed with the original. Permitted when:  By statute  The claim or defense in the amended pleading arose out of the same conduct, transaction, or occurrence set forth in the original pleading OR o Amendment changes the party if 15(b) is satisfied and party to be brought in has received notice and will NOT be prejudiced and know or should have known that the action would have been brought against the party. Bonerb v. Richard J. Caron Foundation (1994) Original complaint alleges P was injured when he injured himself on Ds basketball court. He moved to amend to add counseling malpractice. Court permits amendment on the grounds that relation back doctrine is based upon the principle that one who has been given notice of litigation concerning a given transaction or occurrence has been provided with ALL the protection that statutes of limitation are designed to afford. Amendments that change legal theories are appropriate IF factual situations are the same. (Court relies that initial allegations were sufficient to give facility notice of potential for a lawsuit. No showing of delay or bad faith).

JOINDER A. JOINDER OF CLAIMS AND REMEDIES Rule 18 y Joinder of Claims A party asserting a claim to relief as an original claim, counterclaim, cross-claim, or third party claim, MAY JOIN, either as independent or as alternate claims, as many claims, legal, equitable, or maritime, as the party has against an opposing party (BUT a judge may sever under Rule 42) Joinder of Remedies; Fraudulent Conveyances Notwithstanding Rule 18, federal court MUST still have subject matter jurisdiction under 1331, 1332, 1367.

y y

Counterclaim and Cross-claim y Compulsory Counterclaims arises from the same transaction or occurrence that is the subject matter of opposing partys claim (and does NOT require presence of 3rd parties). o These MUST be asserted as counterclaims or are lost forever. Permissive Counterclaims do NOT arise from same transaction or occurrence. o These MAY be asserted, but do NOT have to 36

Cross-Claim claims by one party against co-party. Arising out of transaction or occurrence that is the subject of the original claim OR counterclaim, or relating to any property that is the subject of the original action.

Plant v. Blazer Financial Services (1979) Is an action on an underlying debt a compulsory counterclaim that MUST be asserted in a truth-in-lending cause of action? HELD COMPULSORY, goal of judicial economy furthered by a single presentation of facts. (see pp. 744-45 for arguments for permissive, state interest, etc other courts have decided differently (Whigham case)) B. JOINDER OF PARTIES y PERMISSIVE JOINDER o Rule 20  Ps y  Ds y May be joined as Ds if right to relief asserted against them arises out of same transaction, occurrence, or series of transactions or occurrences and common question of law or fact May join as Ps if they assert right to relief jointly, severally, or arising out of the same transaction, occurrence, or series of transactions or occurrences and if any common question of law or fact.

Mosley v. General Motors Corp. (1974) 10 Ps, all employees of GM (8 in Chevrolet Div, 2 in Fisher Body Div) sought to be joined in discrimination lawsuit. District court refused joinder b/c ea. P was claiming a different act at a different time in a different place (no common question of law or fact). Appellate court reverses all logically related events entitling a person to institute legal action against another generally are regarded as comprising a transaction or occurrence. Therefore, all reasonably related claims are permitted to be tried in a single proceeding. HELD that general policies arise out of the same transaction and occurrence. y COMPULSORY JOINDER o Rule 19 necessary v. indispensable parties  Necessary: y in partys absence complete relief CANNOT be granted y claims interest in subject matter, judgment w/out him would impair ability to protect interest y claims an interest, leaves another party open to inconsistent obligations  Indispensable: If necessary party CANNOT be joined, court MUST consider: y to what extend judgment in absence would be prejudicial y can prejudice be mitigate y judgment in absence will be adequate? y remedy elsewhere if case dismissed? 37

Temple v. Synthes Corp. (1990) P sues Dr/hospital and device manufacturer in 2 separate suits. Synthes did NOT bring in Dr and hospital as 3rd party Ds, but sought to have the case dismissed on the grounds that P had failed to join indispensable (necessary) parties. HELD joint tortfeasors are NOT indispensable (necessary) parties it has long been held that joint tortfeasors need NOT be joined in a single lawsuit and are merely permissive parties. Helzbergs Diamond Shops v. Valley West Des Moines Shopping Center (1977) contract between H and VW saying no more than 3 full line jewelry stores. Lords opens at 4th store. H brings diversity action against VW for injunction. VW moves to dismiss on the grounds that Lords was an indispensable party. Lords is NOT subject to personal jurisdiction in Missouri, therefore court MUST determine if it is an indispensable party. HELD Court says NO: L will retain ALL of its rights regardless of outcome (can sue if VW tries to evict). The conflicting obligations that VW could be subject to are the result of its execution of both leases. Lords also chose not to intervene. [It would, however, have been reasonable to transfer this case to Iowa that would have gotten rid of the problem.] C. THIRD PARTY PRACTICE Rule 14 y When D may bring in 3rd party: o A person NOT a party to the action who is or may be liable to the 3rd party P [D] for all or part of the claim. o No need to obtain leave if w/in 10 days of serving of the original answer. Otherwise, obtain leave on motion. o 3rd party D shall make any defenses under Rule 12, any counterclaims and crossclaims under Rule 13 o 3rd party D may assert any claim against P arising out of same transaction or occurrence; P may assert any claim against 3rd party D arising out of same transaction or occurrence. o Any party may move to strike 3rd party D, or for severance or separate trial

Price v. CTB (2001) Latco (CTB) wants to bring ITW (nail manufacturer) into suit as 3rd party P. Risk of conflicting judgments2 different juries could find in one case that coop was defective and in the other that it was not (no claim preclusion if ITW was not a party to the first suit). 3rd party liability must be derivative of the original claim. y To find out if there is derivative liability, look to substantive law. 4 possibilities: o Contract providing for indemnification of original D (like an insurance contract) o Right of indemnification as a matter of common law (e.g. implied warranty)  If you sell a product you imply that it will work correctly: implied guarantee of merchantability. o Contribution among joint tortfeasors (in some states)  Instead of suing partner for half, you can implead them. 38

o Statute requiring indemnification y 3rd party MUST be liable to D. CANNOT implead under it wasnt me, it was him. o When P may bring in 3rd party:  When a counterclaim is brought against P, same circumstances under which D could bring 3rd party. o Jurisdictional Problems While many of the counterclaims will have supplemental jurisdiction under 1367, the SC is reluctant to extend supplemental jurisdiction to non-diverse 3rd parties in diversity cases. This would allow the P to circumvent diversity requirements by only suing one party and waiting for the other to be impleaded. (see Owen)  This is affirmed in 1367(b) NO supplemental jurisdiction under Rules 14, 19, 20, 24 (only apply to claims by Ps)

D. INTERVENTION Rule 24 y Intervention of Right upon timely application, ANYONE is permitted to intervene: o when a statute of US confers unconditional right to intervene o when applicant claims an interest relating to property or transaction that is subject of the case.  MUST be so situated that disposition of the case may impair ability to protect interest.  MUST be permitted to intervene unless another party adequately represents that interest. Permissive Intervention upon timely application, ANYONE is permitted to intervene: o when a statute of US confers unconditional right to intervene o when applicants claim and main action have a question of law or fact in common.  Officer or agency of govt may be permitted to intervene when action relies on statue or executive order  Court shall consider whether the intervention will unduly delay or prejudice the adjudication of the rights of the individual parties.

Natl Res. Def. Council v. U.S. Nuclear Regulatory Commn (1978) Underlying action is NRDC v. NRC and MMEIA seeking an injunction prohibiting agencies from issuing licenses to operate uranium mills w/out environmental impact statements. UNC moved to intervene unopposed. Now Kerr-McGee and AMC seeks to intervene as well. 1) interest relating to property or transaction? consequences of ruling may have an impact on KMG and AMC 2) So situated that disposition may impair ability to protect interest? ruling is an issue of 1st impression, would therefore have a stare decisis (MUST follow precedent) effect 3) Not adequately represented by another party? UNC is in a different position than the companies that seek intervention because its license has already been granted. Martin v. Wilks (1989) A group of white firefighters attempted to intervene in a discrimination suit by black firefighters against Birmingham. They were denied. After that case concluded, consent decrees were entered into, setting up hiring goals, etc. A new group of white ffs sued the city saying they were 39

being discriminated against because of the decrees. 11th Circuit held that because ffs were NOT parties to the original case, their claims were NOT precluded. Intervention rules are drafted in permissive terms. But when cases require the presence of another party, there are mandatory joinder rules and it is the responsibility of the current parties to utilize them.

CLASS ACTIONS Rule 23 y Technically, class actions are a joinder device that allows one or more parties to sue or be sued as representative parties on behalf of all those similarly situated. (reap the benefits of combining many lawsuits into one) *** Hansberry v. Lee (1940) pre-dates modern Rule 23, was background for the drafting of the modern rule. o 1st suit (Burke v. Kleiman)  B sued K to enforce racially restrictive covenant. B brought the case as a class action. nd o 2 suit (Hansberry v. Lee)  L brought suit to enforce same covenant on different piece of land. IL SC held that Burke was a class action (with Hs as represented Ps) and therefore Hs were bound by its decision (even though judge never stated that it was a class action) y SC holds that it is a failure of D/P when the procedure does not protect the interests of absent parties. o Burke was NOT an adequate representative of the many interests of the signers of the covenant (some would want to enforce, some would want to challenge, etc.)

A. Pre-requisites to a Class Action y y y y Numerositythe class is so numerous that joinder of ALL members is impracticable Commonality there are questions of law or fact common to the class Typicality the claims or defenses of the representative parties are typical of the claims or defenses of the class Adequacy of Representation the representative parties will fairly and adequately protect the interest of the class

B. Class Actions Maintainable y Class action IS maintainable IF (a) pre-reqs are satisfied AND: o separate actions would create risk of inconsistent adjudications with respect to individual members of the class or adjudications that would as a practical matter be dispositive to the interest of the other members or substantially impair their ability to protect their interests;

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o the party opposing the class has acted or refused to act on grounds generally applicable to the class, making appropriate final injunctive relief or corresponding declaratory relief with respect to the class as a whole; or o questions of law or fact common to the members of the class predominate over questions affecting individual members and a class action is superior to other available methods of adjudication.  Factors to consider: y interest of members of the class in individually controlling separate actions y extent and nature of litigation concerning the controversy already commenced. y desirability or undesirability of concentrating the litigation in a particular forum y difficulties likely to be encountered in the management of a class action C. REPRESENTED PARTIES y Provisions to make proceedings fair to absent members (represented parties) o The court MUST determine by order whether to certify the action as a class action. An order certifying a class action MUST define the class and class claims, issues, or defenses AND appoint class counsel under Rule23(g). This certification order may be altered or amended before final judgment. o For class certified under Rule 23(b)(1) or (2) (risk of inconsistent judgments, judgments dispositive to others claims, injunctive or declaratory relief) the court MAY direct appropriate notice to the class,  For class certified under Rule 23(b)(3) (common questions of law or facts), the court MUST direct best notice practicable under the circumstances to class members, including individual notice to ALL members to can be identified through reasonable effort. (see Rule 23, for what the notice MUST state) o For actions under (b)(1) or (2), the judgment shall include and describe those whom the court finds to be members of the class.  For actions under (b)(3), the judgment shall include and specify or describe those to whom notice under (c)(2) was directed and who have not requested exclusion and whom the court finds to be members of the class. o A class action may be brought with respect to particular issues. A class may be divided into subclasses More provisions to make proceedings fair to absent members determining the course of proceedings and measure to avoid repetition and complication, requiring notice be given of any step in the action or of judgment to permit members to intervene, imposing conditions, requiring that pleadings be amended, dealing with other procedural matters D. Settlement, dismissal, compromise: y Court MUST approve any settlement, voluntary dismissal, or compromise. The court MUST give notice in a reasonable manner to class members who would be bound by a 41

y y y

proposed settlement, dismissal, or compromise. The court MAY approve the settlement, etc ONLY AFTER a hearing and upon finding that it is fair, reasonable, and adequate. Parties MUST file a statement identifying any agreement made in connection with proposed settlement, dismissal, compromise. Actions under 23(b)(3) the COURT may refuse to approve a settlement unless it allows individual class members who did NOT have a chance to do so before to request exclusion. Any class member may object to a proposed settlement, etc.

E. Appeals y Court of appeals may in its discretion permit an appeal from an order of a district court granting or denying class action certification if application is made w/in 10 days after entry of the order.

F. Class Counsel y Appointing o Court MUST appoint class counsel, UNLESS a statute provides otherwise o Appointed attorney MUST fairly and adequately represent the interests of the class o In appointing the class counsel, the court MUST consider: y Work counsel has done in identifying or investigating potential claims y Experience in handling class actions, other litigation, and claims of the type asserted y Knowledge of applicable law y Resources counsel will commit to representing the class y Court MAY consider other matters pertinent to counsels ability to fairly and adequately represent the interests of the class, as well as direct potential counsels to provide information pertinent to appointment, etc and make further orders. Procedure

G. Attorney Fees y Court may award reasonable attorneys fees and nontaxable costs authorized by law or agreement of parties. See Rule 23(h), pp. 56

Walton v. Franklin Collection Agency (2000) Typical decision on Ps motion to certify a class of Ps for a class action. [However, in this case, the court agrees with the D that Waltons claim is not typical. It removes him from the case, BUT certifies the class.] Heaven v. Sun Trust Company Bank (1997) H brought suit against Sun Trust under the Consumer Leasing Act (federal law), sought to certify a class under 23(a) and 23(b)(3). District Court found that H satisfied reqs of (a), but NOT of (b)(3) because ST counterclaimed on the grounds that individual class members either defaulted on lease agreements or made false statements on their forms. Court found that STs counterclaims were compulsory and that their inclusion in the case might potentially compromise individual Ps interests, as well as require separate factual considerations a factor 42

to consider under 23(b)(3)(D). Appellate court defers to district court, suggests considering breaking the class into subclasses. Wadleigh v. Rhone-Poulenc District judge found that class did NOT qualify under 23(b)(3) on proximate cause issues, but attempted to save the class by maintaining the class only with respect to negligence and fiduciary duty, as he is permitted to do under 23(c)(4)(A). Suggests submitting a series of questions to the jury so that they can make different determinations of negligence and standard of care. HELD Posner rules that this was BEYOND the bounds of judges discretion and orders decertification. Cites pressure class action puts on D to settle (thinks Ps claims lack merit is this so? The more successful ones may have settled rather than go to trial) Allison v. Citgo Petroleum Corp. (1998) Question of class certification for suit on behalf on black employees and applicants seeking injunctive, declaratory, and monetary relief (compensatory and punitive damages). Court decides that the class in unsuitable for certification under Rule 23. Judge found that while the class met 23(a) requirements, money damages predominated and therefore it could NOT be certified under 23(b)(2). Need for individualized determinations disqualified for 23(b)(3). Very nature of compensatory damages requires individualized consideration they are an individual remedy and introduce new factual and legal issues [in the past, 5th circuit had often certified classes in discrimination even when there was a request for back pay try liability of a class basis, employer could rebut back pay on a case by case basis. Special Master would make the determination.] H. RULE 82 y These rules shall NOT be construed to extend or limit the jurisdiction of the United States district courts or the venue of actions therein.

I. THE PROBLEM OF NOTICE (and manageability) Eisen Prospective class of 6 million odd-lot traders, 2 million could be identified by name and address (+250K in special investment programs) y Cost of mailing notice would be $225K plus publication notice. (P's overcharge was unusually large: $70. this case had to be brought as a class action or it wouldnt be brought at all.) y Trial judges creative solution individual notice MUST only go to largest buyers. Then individual notice to 5,000 other individuals on a random basis. Notice by prominent publication to everyone else Preliminary hearing on the merits (similar to hearing for preliminary injunction) to determine who must pay for notice: likelihood of success on merits. Concluded Ps had a 90% chance on winning, therefore Ds must pay 90% of notice costs. Ds arguments: Rule 23 requires best notice practicable Since E has names and addresses, the best notice would be to mail individual notice (including all members who can be identified through reasonable effort) rule has already decided what is practicable. Ps arguments: best notice practicable UNDER THE CIRCUMSTANCES 43

Spending $1 million to send notice to all these people is really NOT practicable. Rule 23(d)(2)? But this seems to apply not to notice of beginning of the action, but of other steps along the way What IS individual notice? Can publication notice be individual notice? What if you publish an ad with all 2 million names? But Mullane has absent parties too best notice practicable, which meant mailed notice. Can we distinguish Mullane? (YES NOT A CLASS ACTION) There is more court-supervision here And in Mullane, much more $ could have been at stake (we dont know) Preliminary hearing? y Defense o Guilt hasnt been proven violation of due process o Preliminary hearing is unfair because P has much more time to research, etc. Can crank up costs for Ds since now they dont have to pay. o If Ps want class action, they should pay for it. o Rule 23 doesnt deal with dividing costs; court therefore has NO authority to do this y P o Rule 23(h) could you include this in costs and award them ahead of the judgment?  NOTHING in the rule saying the judge CANNOT apportion the costs. y Defense: see 54(d)(1) there is NO prevailing party yet. o D will NOT get $ back if it wins. Maybe Ps should have to buy a bond. SC sides AGAINST Eisen on BOTH grounds: y Rule 23s requirement of individual notice means that mail MUST be sent, cost is $2 million y Finds NOTHING in the history of Rule 23that gives the court ANY authority to conduct a preliminary inquiry into the merits of a suit in order to determine whether it may be maintained as a class action. Contingency plan? y Create a smaller class, one of 2,000 with the largest claims. Therefore less notice would have to be given. Or you can set whatever threshold you want. J. PERSONAL JURISDICTION OVER PS? Phillips Petroleum v. Shutts (1985) S brought case claiming interest on royalties. 97% of class lived outside of KS (case was brought in KS because PP was incorporated there). PP argues that KS does NOT have personal jurisdiction over class members who did not opt out. Court decides that while Ps DO have due process rights that MUST be protected, the opt-out forms were sufficient in this case. Additionally, burden of judgment is NOT as severe. They CANNOT suffer a default judgment, only lose their right to claim. If SC had said that this scheme violated due process, this just would have led to up to 50 class actions occurring in the nation. 44

HELD Remanded to supreme court of KS. Found that the law of the 6 states was the same on the key question of whether Ps are entitled to recover. The interest rate was different in each state however. Applied each individual states interest rate. y Class action Ps an absent P in a class action that takes place in the forum state may be bound by the decision in the case, even if that P did NOT have min. contacts w/ the forum state (Phillips Petroleum CO. v. Shutts).

K. AGGREGATION OF CLAIMS AND ACHIEVING DIVERSITY STATUS y In Federal Question cases, there is NO min. $ req. Therefore, there is NO min. $ in a class action based on federal law (like truth in lending). o Diversity of Parties only consider domicile of named Ps ignore unnamed Ps, lack of diversity with them will NOT defeat diversity. o Amount in Controversy

Snyder v. Harris SC, based on historical interpretation of 1332 and Rule 82, held that you CANNOT aggregate in class action. Zahn Paper company polluted Lake Champlain. Brought class action on behalf of property owners whose property value was reduced. Zahn himself exceeded the jurisdictional amount, argued that court should exercise ancillary jurisdiction over other claims. SC rejected this reasoning, however. In Snyder and Zahn, the SC pretty much destroyed the possibility of getting class actions based on state law into federal court. Amount in controversy requirement was interpreted in a very strict way matter in controversy was the matter in EACH case, not the total aggregate amount in controversy. Today, hover, 1367 has been enacted. Nothing under Rule 23 is divested. 2005 - SC concluded that 1367 OVERRULED Zahn in Exxon. Exxon SC supported Strawbridge? (Stromberg?) decision (pp. 201) stating that when one P has a claim in excess of the statutory amount and a second has a claim for less, the second may invoke supplemental jurisdiction under 1367. Now: simply aggregating the claims of ALL the class members CANNOT satisfy the amount in controversy; at least some of the members MUST have claims that individually satisfy the jurisdictional amount. But 1367 permits a class action as long as the class representative satisfies the jurisdictional amount. L. SETTLEMENT OF CLASS ACTIONS y Fees see rule 23(h) o But how to calculate?!?!? (see pp. 832-33) o i.e., Coupon settlements 45

Damages and Injunctive Relief (see pp. 835) o Fluid Class Recovery damages are distributed to future consumers through rate reductions. This has the effect to penalizing the D, but NOT compensating the actual Ps. o Settlement Class (see pp. 830-31)

Amchem Products, Inc. v. Windsor (1997) y This suit did NOT begin with the usual summons, complaint, etc. Parties had already reached a settlement when it was filed. They just need certification. Sought to settle current and future claims (proposed settlement covered people who didnt yet have symptoms or didnt know they had been exposed) At negotiations, counsel for inventory Ps attempted to represent the interests of the future Ps, even though there was no attorney client relationship proposed settlement wants to settle all claims not filed before January 15, 1993; exceptional claims may qualify for compensation, but agreement would cap the number of these claims. Only a small # may reject the settlement and pursue their own claims In settlement-class cases, provisions designed to protect absentee members must be paid great attention. (This class does NOT satisfy Rule 23! ) Concerns about adequacy of representation See class notes for pros/cons of this decision!(pp. 836 - 11/07) y Company got o No punitive damages o Damages for pain and suffering limited by schedule o Ten year max liability $3 billion o Annual ceiling on payouts o No bankruptcy y Class member got o No need to prove liability or causation (just exposure and symptoms) o Schedule of damages like workers comp o No need to rush to court after 1st symptom Involuntary bankruptcy would serve the best interest of all parties (i.e., class action members who dont yet have injuries) M. CLASS ACTION FAIRNESS ACT Passed in 2005, designed to enlarge access to federal courts by class action claims y Essentially, the new law provides federal subject matter jurisdiction in class actions in which aggregate amount exceeds $5 million. o Min. diversity requirements: any diversity at all, does NOT have to be complete. y District courts MAY decline to exercise jurisdiction when greater than 1/3 but less than 2/3 of the P class members and the primary D are citizens of the same state. y Court should consider: o whether the claims involve matters of national or international interest, o whether the claims asserted will be governed by the laws of the state in which the action was filed or by the laws of other states, o whether the class action seeks to avoid federal jurisdiction, o whether the action was brought in a forum with a distinct nexus between members, Ds, or alleged harm, 46

y y

o whether # of citizens of the state in which the action was filed is substantially larger than the members from other states, o whether similar class actions have been filed during the prior 3-year period. District courts MUST decline jurisdiction IF the action was brought in the home state of the primary D and 2/3 of the P class members are residents of the primary Ds home state. There IS federal jurisdiction when action is filed in primary Ds home state and less than 1/3 of P class members are residents of the primary Ds home state. Court will DECLINE jurisdiction when more than 2/3 of the class members are residents of the forum state but the primary Ds are not, if: at least one D is a D from whom significant relief is sought, whose alleged conduct forms the basis for the claims, and who is a citizen of the forum state AND the principal injuries resulting from the alleged conduct were incurred in the forum state.

DISCOVERY A. Rule 26 general provisions governing discovery, duty of disclosure (a) Required Disclosures 1. Initial Disclosures a party MUST, w/out awaiting a discovery request, provide to other parties y Name (address & telephone) of each individual likely to have discoverable info that the disclosing party may use to support its claims y Copy of, or description by category and location, of all docs etc that are in the possession, custody, or control of the party and that the disclosing party may use to support its claims y Computation of any category of damages claimed (And docs for inspection and copying under Rule 34) y Insurance agreement (Rule 34 as well) y EXEMPT FROM INITIAL DISCLOURE o Action for review on administrative record o Petition for habeas corpus to challenge to criminal conviction or sentence o Action brought without counsel o Action to enforce or quash administrative summons or subpoena o Action by US to recover benefit payments o Action by US to collect on student loan o Proceeding ancillary to proceedings in other courts o Action to enforce arbitration award Disclosures MUST be made w/in 14 days after Rule 26(f) conference UNLESS a different time is set. 2. Disclosure of Expert Testimony  A party shall disclose to other parties the identity of any person who may be used at trial to present [expert testimony]  This disclosure shall be accompanied by a written report containing a complete statement of all opinions to be expressed and the basis and reasons 47

therefore, data and info considered by the witness in forming opinions, qualifications of witness, compensation, other cases in which he has testified 3. Pre-trial Disclosure  name address telephone # of each witness, designation of witnesses who testimony is to be presented by deposition (and transcript), identification of each document or other exhibit. Made at least 30 days before trial. W/in14 days, other party may file objections, objections not disclosed are waived. (b) Discovery Scope and Limits 1. Parties may obtain discovery relating to any matter, not privileged, that is relevant to the claim or defense of any party. y For good cause, the court may order discovery of any matter relevant to the subject matter in the action. y Relevant info need NOT be admissible at trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence. 2. The court may limit rules on # of depositions and interrogatories (or length) under Rule 30. Court may also limit # of requests under Rule 36. y Court may also limit if it determines that the discovery sought is unreasonably cumulative or duplicative or is obtainable from some other source that is more convenient, less burdensome, or less expensive, the party seeking discovery has had ample opportunity to obtain info sought, or burden or expense of proposed discovery outweighs its likely benefit 3. A party may obtain discovery of docs, etc otherwise discoverable and prepared in anticipation of litigation or trial by or for another party or by or for that partys representative (atty, consultant, insurer, etc) ONLY upon a showing that the party seeking discovery has substantial need of the materials in the preparation of the partys case and is unable w/out due hardship to obtain the substantial equivalent by other means. y Court shall protect against disclosure of the mental impressions, conclusions, opinions, or legal theories of an atty or other rep of a party concerning the litigation. y A party may obtain a statement concerning the action or its subject matter previously made by that party. 4. Experts experts may be deposed, but deposition shall NOT be conducted until after the report is provided. y A party may discover facts known or opinions held by an expert who has been retained or specifically employed by another party in anticipation of litigation or preparation for trial and who is not expected to be called as a witness at trial only as provided in Rule 35(b) or upon showing of exceptional circumstances under which it is impracticable for the party to obtain facts or opinions on the same subject by other means 5. Privilege when a party withholds info under claim that it is privileged, they MUST make the claim expressly and shall describe the nature of the documents etc to enable other parties to assess the applicability of the privilege or protection (c) Protective Orders 1. Court may make any order which justice requires to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense, including: a) That the discovery or disclosure NOT be had 48

b) c) d) e)

That the discovery or disclosure only be had under certain conditions That the discovery be had by another method That the scope of disclosure or discovery be limited That the discovery be conducted with no one present except designated persons f) That the deposition be sealed and opened only upon order of the court g) That a trade secret NOT be revealed h) That parties simultaneously file info in envelopes to be opened as directed by the court

(e) Supplementation of Disclosures and Responses a. a party is under a duty to supplement if the party learns that in some material respect the information disclosed is incomplete or incorrect and if the additional or corrective information has not otherwise been made known to the other parties b. a party is under duty to amend a prior response to an interrogatory, request for production, or request for admission if the party learns that the response is in some material respect incomplete or incorrect and if additional corrective info has not been made known to other parties. (f) RULE 26(f) conferences! (g) Disclosures, requests, responses, and objections MUST be signed that they are consistent with the rules, not improper, not burdensome, etc a. IF certification is made in violation of this rule, the court SHALL impose an appropriate sanction B. RULE 30 y Depositions Upon Oral Examination

A party may take the deposition of any person w/out leave of court (EXCEPT for if person is in prison, # of depositions would be over the limit, person has already been deposed, deposition is before time specified in 26(d)). Attendance of non parties may be compelled by subpoena (Rule 45) o See 30(b)-(g) for notice, methods, requirements, OBJECTIONS TO QUESTIONS, failure to attend, etc Use of Depositions in Court Proceedings Interrogatories to Parties Production of Documents

C. RULE 32 D. RULE 33 E. RULE 34

F. RULE 35 Physical and Mental Examination of Persons G. RULE 36 Requests for Admission

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H. RULE 37 Failure to Make Disclosure or Cooperate in Discovery, SANCTIONS (a) Motion for order compelling disclosure or discovery (37(a)) o motion should be made to the court in which the action is pending (for a party) or to the court in the district where the discovery is being taken (for a non party) o if a party fails to make a disclosure under 26(a), any other party may move to compel disclosure and for appropriate sanctions. Motion MUST certify that movant has conferred or attempted to confer with non disclosing party o if a deponent fails to answer a question (or allow inspection, etc), discovering party may move for an order compelling answer, inspection, etc (good faith requirement) o evasive or incomplete answers (disclosures, etc) are to be treated as FAILURES to respond o if the motion is GRANTED, the court shall require the party or deponent (or the atty advising the conduct) to pay the moving party reasonable expenses incurred in making the motion, unless the motion was made without good faith effort to obtain disclosure w/out court action or that the nondisclosure was substantially justified o if the motion is DENIED the court may enter a protective order (26(c)) and require the moving party (or atty) to pay to the party or deponent expenses incurred in opposing the motion (b) Failure to comply with order (37(b)) o failure to answer question at deposition after being directed to do so may be considered contempt of court o if a party (or officer, director, etc) fails to obey an order to provide or permit discovery, or an order entered under rule 26(f), the court MAY make such orders as are just, including: o Ordering that matters regarding which the order was made or other designated facts shall be taken to be established for the purposes of the action in accordance with the claim of the party obtaining the order o Refusing to allow the disobedient party to support or oppose certain claims or defenses, or prohibiting that party from introducing designated matters into evidence o Striking the pleadings or parts of pleadings or staying further proceedings until the order is obeyed, or dismissing the action or proceeding or any part thereof, or rendering judgment by default against the disobedient party o Contempt of court (EXCEPT order to submit to physical exam) o The court shall also require (in lieu of or in addition to these other sanctions) the disobedient party or atty to pay the other sides attorneys fees caused by the failure UNLESS the court finds the failure substantially justified or other circumstances (c) Failure to disclose o A party that fails to disclose 26(a) info or 26(e)(1) info w/out substantial justification is NOT permitted to use a witness or info not disclosed as evidence. Sanctions under 37(b) may be imposed as well o If a party fails to admit the genuineness of a document or the truth of a matter under Rule 36, they MUST pay reasonable expenses incurred in proving the matter by the other side. 50

(d) Failure to Attend own Deposition or Serve answers to Interrogatories or respond to request for inspection: o Court may make such orders as are just, included 37(b)(2) sanctions I. RULE 45 -- SUBPOENAS J. Relevance? (Rule 26(b)(1)) Davis v. Precoat Metals (2002) Employment discrimination case, alleging race and national origin discrimination. Ps seek discrimination complaints made against D by other employees at the same plant. Is this relevant? Could be good evidence (could also generate more fees for the lawyers). Court rules that this info is discoverable (esp., since Ps narrowly tailored the time frame of their request and type of discrimination) as it may be used to establish pretext Steffan v. Cheney (1990) Navy asks P to say whether he committed homosexual acts. P objects that the question is NOT relevant to the legality of his separation (discharge), which is the subject of the action and which was based on his statement that he was homosexual. Judicial review of an administrative action is confined to the grounds upon which the record discloses the action was based. Therefore, other potentially disqualifying conduct is irrelevant. K. Privilege (26(b)(1)) and Trial Preparation Material (Rule 26(b)(3) did NOT become effective until 1970) y Common privileges self-incrimination, attorney-client, doctor-patient, psychotherapistpatient. o You can waive privileges (as relevant to the case by bringing the case (i.e. if you, yourself, raise the question) see pp. 439-40

Hickman v. Taylor (1947) to what extent can a party inquire into oral and written statements of witnesses, or other information, secured by an adverse partys counsel in the course of preparation for possible litigation after a claim has arisen? D lawyer interviewed survivors of crash and took statements which the survivors signed. He also interviewed other witnesses. P asked for copies of the statements and details of the oral statements. HELD the statements and mental impressions fall outside the scope of attorney-client privilege, but that Rule 26 does NOT compel discovery of these materials and to rule that they are discoverable contravenes public policy underling the orderly prosecution and defense of claimsit is essential that a lawyer be able to work with a certain degree of privacy. Production might be justified if witnesses were NO longer available y 26(b)(3) codified this decision and went farther it protects the work product of all investigators, not just attorneys (but you CAN discover the investigative report if it was not written in anticipation of litigation or you have a special need

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L. Expert Information (Rule 26(b)(4)(B)) y In general, you CANNOT find out what non-testifying experts told a party, but there are some EXCEPTIONS.

Thompson v. The Haskell Co. (1994) P seeks to protect psychological evaluation done for previous counsel. Court rules that even if the report is covered by 26(b)(4), it is STILL discoverable because it was prepared very close to Ps firing and no other report was prepared. Therefore D CANNOT obtain the same info by different means there are exceptional circumstances Chiquita International Ltd. v. M/V Bolero Reefer (1994) P brought case for lost cargo (allegedly due to faulty loading cranes on the boat). P had the boat examined by a marine surveyor shortly after it docked. D seeks the experts file and deposition. P claims he is a non-testifying expert protected by 24(b)(4). Court finds NO exceptional circumstances because D could have had the boat examined by its own expert and had ample time to hire one. M. Remedies: Management and Sanctions: Pressey v. Patterson (1990) Police Dept destroyed tapes of an interview, told Ps counsel that tapes had been reused (false). P moved for sanctions, district court struck citys answer and entered default judgment (is this an appropriate sanction? 37(b) is for court orders, there was no court order here.) Appellate court reverses, decides that Reiser could have destroyed the tapes for any number of reasons and had reason to believe that the info would get to P anyway. Requires bad faith Thompson v. Dept of Housing and Urban Development (2001) Ps request 20 years of documents, D opposes on the ground that it is burdensome. Judge, rather than ruling on the matter, tells the parties to work out a compromise (maybe 5 years of docs and then reevaluation?) N. ETHICS, ABA MODEL RULES most states have adopted some version of the Model Rules (SEE SUPP. 176-184)

ALTERNATIVES TO TRIAL y 6 ways in which lawsuits can be TERMINATED W/OUT TRIAL

1. Negotiated Settlement (60%) y D agrees in writing to do something, P agrees to dismiss case need a new lawsuit to enforce the contract y OR P agrees to consent decree (stipulated judgment) that provides that D will do certain things o This 2nd option allows the sheriff to seize Ds assets if he doesnt pay, gives you preference in a bankruptcy proceeding (a contract would put you on the level with other creditors) 52

y y y

** when there is a fee-shifting statute, it only applies when there is a prevailing party, which requires a judgment (Buckhannon) In fraud cases, Ds are very likely to ignore judgments Problems with sending out the sheriff o under state law, there are exceptions to what sheriff can seize. Ex.1: house held in tenancy by the entirety CANNOT be seized on judgment of just one spouse. Ex.2:In FL, house CANNOT be seized at all (homestead exemption) o may have to post bond in case sheriff wrongfully seizes property and is sued. o If D leaves the forum, you need to get a judgment on the judgment in the new state o Hidden assets uniform fraudulent conveyance act PERMITS another lawsuit to get back property from Ds spouse, etc if the conveyance what not for full value (was a sham). If D is a wage-earner, you can serve employer with a wage garnishment SECRECY AGREEMENTS should Ds be able to purchase silence? Should the court be able to breach confidentiality agreements? When there is a settlement, there is NO proof that the D is actually guilty or liable. Ex: Kalinauskas v. Wong (1993) P wants to depose a former employee of D who also filed a sexual harassment suit against D, but settled and signed a confidential settlement agreement. Court allows deposition, but not on facts of settlement, only on employment and sexual harassment.

2. Default Judgment based on complete failure to defend (rare in federal system, 14% in state system) 3. Judicial dismissals (Rule 12) 4. Involuntary dismissal of case by the court at a later stage (Rule 41 permits the court to dismiss if P violates rule, excessively delays, does not demonstrate right to relief 5. Voluntary dismissal by P, either as of right or with permission of the court (Rule 41) 6. Summary judgment (Rule 56)

DEFAULT JUDGMENTS AND DISMISSALS y Default Judgment Rule 55 o When a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend and that fact is made apparent by affidavit, the clerk shall enter the partys default o When claims is for sum certain or for which computation can be made certain, the clerk shall enter judgment upon request and affidavit if he has defaulted. In all other cases, the court may conduct hearings (see 55(b)(2)). If party has appeared, he shall be served 3 days prior to hearing. o court may set aside default and judgment (Rule 60(b)) for good cause o these provisions apply whether party entitled to judgment is P, 3rd party P, or party to a counterclaim or cross-claim 53

Dismissal Rule 41 o Voluntary Dismissal  By P an action may be dismissed w/out order of the court by filing a notice of dismissal at any time BEFORE service by the adverse party of an answer or of a motion for summary judgment OR by filing a stipulation of dismissal signed by all parties. Dismissal is w/out prejudice EXCEPT when filed by a P who has once dismissed based on the same claim. (subject to 23(3) and 66)  By order of the court except as provided in section 1, an action CANNOT be dismissed except by order of the court upon such terms and conditions as it deems proper. Counterclaims shall NOT be dismissed against Ds objection UNLESS it can remain an independent action. o Involuntary Dismissal D may move for dismissal for failure to prosecute or comply with rules or order of the court. o Dismissal of counterclaim, cross-claim, 3rd party claim similar provisions as 1st . Voluntary dismissal by claimant shall be made BEFORE a responsive pleading is served OR BEFORE the introduction of evidence at the trial or hearing. o Costs If P brings a once dismissed action, the court may make such order for the payment of the costs of the previous action as it may deem proper.

SUMMARY JUDGMENT Rule 56 When the record shows that there is NO genuine issue as to any material fact, the moving party is entitled to a judgment as a matter of law. If the case has several issues, partial summary judgment can be granted to narrow the issues and go forward (ex: judgment on liability, trial on damages). Adickes v. S.H. Kress & Co (1970) D moving for summary judgment has the burden of showing that the P CANNOT prevail at trial. Celotex v. Catrett (1986) Issue was whether P had ever been exposed to Celotex. D moved for summary judgment on the grounds that P could NOT prove causation. P argues: 1) D cannot move for summary judgment w/out an affidavit, and 2) D has to show that P cannot prove that he was exposed to Celotex product. D CANNOT do this because of a letter from Ps supervisor. D has not rebutted letter. HELD there is NO need for an affidavit, D can make its showing just by suggesting an absence of Ps evidence (look to the substantive law to tell you what the burdens of the P are). Once that showing has been made, P has the burden of proving at least some evidence (remand to Court of Appeals to decide if letter is sufficient). y The party that has the burden of proof has the equivalent burden at summary judgment

Bias v. Advantage International, Inc. (1990) Basketball player cocaine case. 54

Specific knowledge (testimony of 2 friends) v. general knowledge (coach, parents, test) It seems that general is not sufficient to rebut specific.

TRIAL A. Trial Preparation B. Pretrial Conferences and Orders Rule 16 y y Conference for the purpose of expediting disposition, establishing control, discouraging wasteful pretrial activities, facilitating settlement. Judge, after receiving 26(f) report shall set a schedule for joinder, amendments, motions, discovery, etc. The schedule shall NOT be modified except on showing of good cause. o The pretrial order shall control the course of action UNLES modified. The final order shall be modified only to prevent manifest injustice. o Sanctions judge may impose sanctions for failing to obey an order

McKey v. Fairbairn (1965) Counsel for P moved to amend pretrial order to permit him to introduce housing regulations. HELD trial judge did NOT abuse his discretion in denying the motion C. Jury Trial y 7th Amendment: in suits at common law the right of trial by jury shall be preserved. This means that the right to a jury trial is limited to those cases in which you would have received a jury trial in 1791 (i.e. legal claims) see pp. 570-71, -75. But for equity cases, there is no right of trial by jury.

Amoco Oil Co. v. Torcomian (1983) How to deal when equity claims are combined with legal claims? Amoco makes some legal claims: ejectment, damages. It also has some equitable claims. Furthermore an equitable main claim CANNOT preclude a jury trial on a legal counterclaim (Ts lost profits) Beacon Theaters Jury trial should precede [bench] hearing on equitable claims and the jurys findings control as to any common factual issues Judges are also authorized to empanel an advisory jury in equitable cases. D. Settlement/ADR y y Alternative Dispute Resolution Act of 1998 requires each federal district court to authorize, devise, and implement its own alternative dispute resolution program Federal Arbitration Act allows for enforcement of arbitration agreements in the federal courts. Designed to force the parties to honor their agreement to arbitrate 55

Courts have begun to discriminate among arbitration agreements on the basis of the fairness of the procedures they employ and refuse to enforce agreements they find fundamentally unfair (see pp. 508) such as lack of mutual obligation.

E. Trial Procedure F. Burden of Persuasion y In civil cases, burden of persuasion is variously defined as the preponderance of evidence, more probable than not, more likely than not o This means that the trier of fact can find for the party with the burden of persuasion if he finds the material fact probable. Burden of Production which party is required to produce (present) the evidence in the first place? o Ex: D MUST produce evidence supporting a statute of limitations claim, o Ex: P MUST produce evidence of negligence

G. Judgment as a matter of law (Rule 50), New Trials (Rule 59) y JMOL if during trial, a party has been fully heard and there is NO legally sufficient evidentiary basis for a reasonable jury to find for that party on that issue, the court may determine the issue against that party. Motions may be made at any time before submission to jury. o If court does NOT grant motion for JMOL at close of evidence, the court is considered to have submitted the case to the jury SUBJECT TO the courts later deciding the legal questions raised by the motion. Movant may then renew his request no later than 10 days after entry of judgment and may also request new trial under rule 59. New Trials (see rule 59) Can be granted when the judge concludes that the process was flawed (impermissible arguments to jury, erroneous jury instructions, etc) OR if judge decides that the verdict is unjustifiable against the great weight of the evidence

Lind v. Schenley Industries (1960) Verdict should be scrutinized more carefully when trial is complicated and deals with unfamiliar subject matter. The contract case at hand though, turned on the credibility of the witnesses and was squarely w/in the comprehension of jurors. (Dissent points out unbelievable nature of Ls story) Inferences and Presumptions Lavender v. Kurn (1946) You MUST uphold the jury verdict when there are conflicting theories, if the jury could have reasonably decided that way by making inferences. (in this case, both stories required inferences). Only reversible when there is a complete absence of probative facts to support the conclusion reached.

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Pennsylvania RR v. Chamberlain (1933) NOTE THAT THIS CASE WAS DECIDED BEFORE LAVENDER Was there a conflict of testimony as to the facts? At most, there was an inference drawn from observed facts which gave equal support to the opposite inference (which cars crashed). In such cases, JMOL MUST go against party upon whom rests the necessity of sustaining one of these inferences before he is entitled to recover.

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