4 elements to Get into Federal Court (or any court)

Subject matter jurisdiction – power over the topic

Personal jurisdiction – authority over the persons involved
Proper notice – notifying parties of action
Venue – locale

Subject Matter Jurisdiction - which kind of cases belong in which courts.

Federal Question
Diversity of citizenship and greater than $75,000

Power of a court to decide certain kinds of cases. Full Faith and Credit, Due Process Clause.
Subject Matter - the topic or issue that is being considered; the issue in dispute before a court,
legislature or an administrative body.

Constitution: Article III, sec. 2

Section 2. Judicial power extended to:

Constitutional disputes
Law and Equity
U.S. law and treaties
Disputes in which the U.S. is a party
Disputes between two or more states
Diversity of citizenship

Trial of all crimes (except Impeachment) shall be by jury

Statutes: 28 U.S.C. §§ 1331, 1332

§1331. Federal Question The district courts shall have original jurisdiction of all civil
actions arising under the Constitution, laws, or treaties of the United States.

Federal Question – cases arising under the laws of the U.S., treaties, or the Constitution; Not
exclusive to the federal courts (concurrent jurisdiction), state courts may also hear cases.

U.S.C. Federal jurisdiction is exclusive in cases involving admiralty (§1333), bankruptcy (§1334), and
antitrust (§1335)
“Arising under” = that which comes from the (Π) theory of the case
 Louisville & Nashville Railroad v. Mottley LIFETIME RAILROAD PASS U.S. Sup. Ct., 1908

Railroad (∆) v. invalid lifetime pass holder (Π)

Summary: (Π) was given a lifetime pass for transportation on (∆) railway as a settlement for an accident. Congress then
outlawed lifetime passes. (∆) railroad refused to accept the passes and (Π) filed a suit for specific performance. (Π) was
awarded damages in federal trial court. (∆) Appealed to the supreme court.

Ruling & Rationale: Court ruled the Trial court was without jurisdiction. Supreme Court has a duty to see that the
jurisdiction of the Circuit Court is not exceeded → court can make its own motion without a motion from either of the
parties involved (sua sponte).

Well- Pleaded Complaint Rule: Suit arises under Federal Question only when the (Π)’s statement
of his own cause of action shows that it is based upon those laws or that Constitution. (there was no
diversity of citizenship in this case)
 §1332. Diversity of Citizenship

(a). The district courts shall have original jurisdiction of all actions where the matter in
controversy exceeds the sum or value of $75,000 (exclusive of interest and costs) and is
between:

Citizens of different states

A citizen of a state and subjects of a foreign state
Citizens of a different state and in which foreign states or citizens are additional parties.
A foreign (Π) and a citizen of a state

(c). Definition of a Corporation.

where it is incorporated and where it has its primary place of business (except where an insured (Π)
sues his insurer; insurer will be determined to be a citizen of that state.)
Legal representative of a decedent, or legal representative of an infant/incompetent, shall be a citizen
only of that of the represented person.

*** *** *** *** ***

To be a citizen

First must be a citizen of U.S.

Must be a citizen at the time the complaint is filed
All (Π)s must be diverse from all (∆)s (Strawbridge v. Curtis)

Citizenship = domicile (Louisville Railroad)

Must have residence

Must have intent to stay
until you acquire a new place, you retain the last domicile

Mas v. Perry PEEPING-TOM LANDLORD 5 th

Circuit Court of Appeals, 1974

(Π) couple tenants (husband foreigner, wife state) v. (∆) peeping-tom (Louisiana)

Summary: (∆) appealed from a judgment for (Π) awarding damages incurred as a result of the discovery of "two-
way" mirrors through which the appellant landlord watched them. Jury awarded $5,000 to Mr. Mas and $15,000 to Mrs.
Mas. (∆) Appealed claiming lack of jurisdiction (for diversity of citizenship).

Ruling & Rationale: Awards were affirmed. Two separate legs of jurisdiction stood → claim of an alien v. state
citizen, and an action between citizens of different states.
Partnerships – for diversity purposes not considered entities (as in property) but as collection of in

dividuals; i.e. 1 (Π) v. 2 (∆)’s

Corporation citizenship § 1332 (c) (1) – dual citizenship; where it is incorporated an where it
has its chief place of business

Often business incorporate under the law of a state deemed to have more permissive corporation
laws (Delaware)

“Chief place of business” = question of fact.

Saadeh v. Farouki FOREIGNER LOAN DISPUTE D.C. Court of Appeals, 1997

(Π) lender, Greek citizen v. (∆) borrowing “permanent resident”

Summary: (∆), a Jordanian citizen residing in Maryland (“permanent resident” immigration status in U.S.) defaulted on
a loan from (Π), a Greek citizen. While litigation was underway (∆) became a citizen of the U.S.

Rule & Rationale: Court dismissed the case for lack of subject matter jurisdiction. 28 U.S.C. §1332(a): “an alien
admitted to the United States for permanent residence shall be deemed a citizen of the State in which such alien is
domiciled.

A literal reading of the statute would produce an unconstitutional result - a federal diversity jurisdiction over a lawsuit
brought by one alien against another. The Judicial power of the U.S. does not extend so far

The legislative act “clearly appears to have been intended only to eliminate subject matter
jurisdiction of cases between a citizen and an alien living in the same state” as that citizen.
Amount in controversy is tested by the (Π)’s complaint.

Must be $75,000.01 or greater: (Π)’s good faith claim of damages.

Whether you can aggregate multiple clients, claims

a single (Π) may aggregate any claims he has against a single (∆) to reach the required sum
Cannot add claims from multiple (∆)’s to reach required sum
Cannot add his claim to that of another (Π) to reach required sum

Amount in Controversy – significant issues:

Injunctive relief instead of $

Value of the injunction to the (Π)

Cost to the (∆) of complying
Cost or value to the party invoking federal jurisdiction
Allow jurisdiction if any of the tests above yields statutory amount
Aggregation of Claims

A single (Π) with two or more unrelated claims against a single (∆) may aggregate claims
2 (Π)s each have claims against a single (∆), they may not aggregate claims if their claims are
“separate and distinct”
If one (Π) has the required limit and another does not, both may invoke federal jurisdiction if their
claims are related.
Multiple (Π) or multiple (∆) with a common undivided interest and single title or right, the value of the
total interest will be used
Class actions: aggregating the claims of all the class members CANNOT satisfy the amount in
controversy.
Counterclaims - (Π)’s claim exceeds limit → counterclaim allowed regardless of amount. However
unsettled if (Π) claim less than limit and the counterclaim exceeds limit.
 Supplemental Jurisdiction
Supplemental Jurisdiction: allows parties to expand the litigation by joining claims in a single
action; cases that if brought independently, would not have fit within the federal courts subject
matter jurisdiction.

Title 28 § 1367: supplemental jurisdiction = pendent or ancillary

Pendent Jurisdiction (adding a claim): when a (Π) has 2 claims, one a federal claim, and a
second under state law, both can be brought in federal court providing they both arise from the
same “nucleus of facts”

The Federal Claim:

Must have substance sufficient to confer subject matter jurisdiction on the court, AND
must derive from a common nucleus of operative fact.

Gibbs: the federal court has the power to hear claims that arise from the same nucleus of facts,
but it is not required to hear the related claims.

Ancillary Jurisdiction (adding a party): related claims asserted by (∆) or other additional
parties after the initial complaint, although not separately under federal jurisdiction, can be
brought in federal court so long as they are closely related.

{ 3rd party (Π) can only recover from the 3rd party (∆) if the (Π) recovers from the 3rd party
(Π) }

United Mine Workers v. Gibbs U.S. Supreme Court, 1966

Striking union (∆) v. temporary help (Π)

Summary: Striking union (∆) prevented (Π) from fulfilling a haulage contract, and (Π) began to lose other tucking
contracts and mine leases allegedly because of the (∆)’s “concentrated plan against him.” (secondary boycott –
striking against 3rd party workers – illegal under federal law)

Procedural Context:

federal claim of breaking federal law

state claim of “unlawful conspiracy and an unlawful boycott”

Federal Circuit court ruled on both; union pressure didn’t fall under the federal law, but the employment
relationship was under a state claim

Issue: Whether the Dis. Court properly entertained jurisdiction of the claim based on state law. Ruled it was with in
same nucleus of operative fact
 Pendent Jurisdiction exists whenever there is a claim arising under the Constitution or U.S. Law, and the
relationship between that claim and the state claim permits the conclusion that the entire action before the court
comprised but “one” constitutional “case.”

The Federal Power to hear state actions need not be exercised in every case in which it is found to exist.

If the federal claims are dismissed before trial, the state claims should be dismissed
If the state issues are substantially predominant (can be dismissed without prejudice.
Reasons independent of jurisdiction, i.e. jury confusion.
Issue of whether pendent jurisdiction has been properly assumed remains open throughout the litigation

Removal - (∆)’s chance at federal jurisdiction; only applies when the (Π) has brought the case in state
court.

Removal § 1441

(a)

civil action brought in state court

over which the federal court has original jurisdiction
(∆)’s can remove the case to the federal district court embracing the place where the case is pending.

(b)

if based on a federal question, may be removed regardless citizenship

if not, must have diversity of citizenship.

§ 1446 (b) – notice of removal must be filed within 30 days of

the service of process, or within 30 days of service of summons.
(GENERAL RULE for TIMING) But if it not removable, notice
of removal my be filed 30 days after the case becomes
removable, except that a case may not be removed upon
diversity after one year following the filing of the action

Caterpillar, Inc. v. Lewis REMOVAL

Bulldozer manufacture (∆) v. injured (Π)

(Π) citizen of KY → (∆) incorporated in DE, primary place of business IL

 (Π) citizen of KY → (∆) maintenance company in KY

(Π) settled with the (∆) Maintenance company; Diversity remained

(∆) Caterpillar, one day before year jurisdiction, removed the case when complete diversity did not yet exist; settlement was
reached, paperwork was not complete.

Case went to trial, jury verdict for the (∆). Court of Appeals reverses. U.S. Supreme Court says at the time of judgment
there was no diversity, so although the removal was wrong, the judgment of the jury was affirmed.

Personal Jurisdiction
Pennoyer v. Neff PRESENCE 1877

Case A: Lawyer (Π) v. former client (∆) Neff

Lawyer sues for client for fees [action in person – action for a personal obligation; used the presence of the property
(attachment) in place of his personal presence (quasi in rem)]
Default judgment entered (Π) lawyer
Neff receives land
Sheriff sells Neff’s land; lawyer gets $
Pennoyer buys Neff’s acquired land, receives sheriff’s deed

Case B: Neff (Π) sues Pennoyer (∆) for his land [action in rem – action for property]

Neff claims he was not served process

Attachment of Property – posting notice on the actual property; must occur at the beginning of the lawsuit to notify you of
the lawsuit.

*** Presence gives the court power of jurisdiction. Although the (∆) was not in court, the court obtained power over the
(∆) through (∆)’s land

RULE – substitute of process by publication is effectual only where:

Property in the State is brought under the control of the court and is subjected to its disposition by process adapted to that
purpose, OR
Where the judgment is sought as a means of reaching such property or affecting some interest therein.

Exceptions:

If cause of action is one of status: court can dissolve status without having the absentee spouse in court. If child support or
other claimed, then the person must be present
Contract, partnership, or association. If you have an agent in the state, then that substitute can receive notice – out of state
partner doesn’t need service
Corporation – agents get notice

POWER NOTICE

Presence Personal
Presence Constructive - publication

Presence of property Constructive – posting on land

In personam jurisdiction: Lat. Against the person. In procedure: An action taken against a person
which involves his personal rights and is based on jurisdiction over him. One must personally serve
that person with process within the borders of the state in question.

In rem jurisdiction: Lat. Actions against a thing (res) and not against a person. A lawsuit in
rem involves settlement of a property claim without reference to the individual claimants. This
judgment is binding on all claimants to the property, whether they are parties to the action or
not

Quasi in rem jurisdiction: when in rem jurisdiction was used to adjudicate claims unrelated
to the property itself. I.e. the lawyer Mitchell wanting to sell Neff’s property to satisfy a
(personal jurisdiction) legal fee.

Collateral attack: Pennoyer links Full Faith and credit to jurisdiction – the courts of State Y
need not heed the a judgment by the courts of State X if X lacked personal jurisdiction over the
(∆).

Harris v. Balk

Harris owed Balk money

Harris traveled to MD, Epstein served Harris w/ process. Harris to pay Epstein the money he owed Balk.
Court said that yes you can do this.
Harris was the same as property

Personal Jurisdictional Challenges:

Decline to appear, suffer a default judgment and attack the judgment only when the (∆) seeks to
enforce it in a subsequent proceeding (collateral attack). RISK = if second court rejects the
jurisdictional challenge, (∆) can raise no defenses on the merits. Only jurisdiction is open to collateral
attack.
Raise the defense in a pre-answer motion, or in (∆)’s answer to the charges.
Making an appearance or litigating other issues but failing to challenge personal jurisdiction results in
waiver of the jurisdictional defense.
If no pre-answer motion is filed but (∆) challenges jurisdiction in his answer, he must promptly move
for dismissal on this ground.
“Special appearance” (few state systems and old cases): permitted the (∆) to object to jurisdiction
without the action of objecting being itself basis for jurisdiction.

Federal Rule 12(b): (∆) can file a motion, before filing a response. If no jurisdiction over the subject
matter or no jurisdiction over the person. Personal jurisdiction MUST be the first thing you do.

International Shoe Co. v. Washington U.S. Supreme Ct., 1945

(∆) shoe company v. (Π) State

(∆) incorporated in DE / principle place of business in MO

Cause of Action: (Π) sued to collect taxes against (∆) company. Notice of assessment was personally served upon a
sales solicitor employed by (∆) in the state, and a copy was mailed (registered) to the (∆) in St. Louis.

Procedural Context: (∆) appeared specially; claimed service was not proper; it was not a corporation in
Washington, not doing business in the state; no agent within the state whom service could be made; (∆) is not an
employer and does not furnish employment within the state.

(∆) company is incorporated in Delaware and has its principle place of business in St. Louis. It maintains places of business
in several states other than Washington. No office, contracts for sale or purchase, no stock, no deliveries of goods.

Issue:

whether the (∆) corporation has by its activities in the state rendered itself amenable to proceedings in the courts of that state
to recover unpaid contributions to the state fund enacted by statutes
whether the state can exact those contributions consistent w/ due process

Supreme Court of Washington:

solicitation of orders resulted in a continuous flow of (∆)’s product into the state sufficient to constitute doing business
solicitation w/ additional activities = doing business. Additional activities included: temporary and permanent display areas

U.S. Supreme Court:

To subject an (∆) not present within the territory, to a judgment in personam, due process requires (∆) have certain
minimum contacts.
Whether due process is satisfied → depends on the quality and nature of the activity in relation to the fair and orderly
administration of the laws which it was the purpose of the due process clause to insure

Presence = continuous and systematic activities that are related to the cause of action. Privilege of conducting
activities within the state, and enjoying the protection of that state’s laws = gives rise to obligations.
Stream of commerce which constitutes “minimum contacts” between (∆) and forum state such that the exercise of
jurisdiction “does not offend ‘traditional notions of fair play and substantial justice.’”
Isolated, casual contacts which are unconnected to the activity = no jurisdiction
Lots of Activities, but unrelated = possible jurisdiction
Few Activities, but related = probably not, but maybe.
(∆) activities were significant to establish the obligations

The agent, whose activities established the presence, is a sufficient party to be served process to give proper notice; mailing
was O.K.

Specific Jurisdiction - (∆)’s actions relate directly with the cause of action

General Jurisdiction - (∆) has so many actions within the jurisdiction that the (∆) can be called
into court under any action

Circumstances where (∆) may be sued for all claims

Corporations → incorporation Individuals → domicile

Derivative action – A representative of a corporation, independent of its directors, sues the

directors/trustees charging misguiding of the corporation’s affairs; proceeds of a successful suit go to
the corporation.

Shaffer v. Heitner WIPED OUT QUASI IN REM U.S. Supreme Court, 1977

Greyhound officer/directors (∆) v. shareholder (Π)

(∆) incorporated in Delaware; principle place of business = Phoenix

(Π) non-resident of Delaware, sued in Delaware court.

Procedural Context: (Π) filed a shareholder’s derivative suit against the Board because the company was subjected
to an antitrust action

Simultaneously, (Π) filed a motion of sequestration of the Delaware property → The individuals were
non-residents of Delaware, but their common stock was to be Delaware property (Delaware law)
Delaware courts rejected all of (∆)’s arguments.

Issues: Whether the International shoe standard of fairness and substantial justice for presence=privilege=obligation should
apply to in rem as well as in personam.

Potential liability to a (∆) in an in rem case is limited by the value of the property. However the fairness of subjecting a (∆)
to state court jurisdiction does not depend on the size of the claim being litigated
State’s strong interest in assuring the marketability of property within its borders and in providing a procedure for peaceful
resolution of disputes = support for jurisdiction
All assertions of state court jurisdiction must be evaluated according to the standards set forth in International Shoe.
Quasi in Rem is not fair under the International Shoe standard.
Assertion of jurisdiction in this instance: the property is not the subject matter of this litigation, nor is the underlying cause
of action related to it.

(∆) holding of stock do not provide sufficient contact with Delaware to support the jurisdiction.

Procedural Outcome: Judgment against the (∆) REVERSED and remanded.

Quasi in rem – wiped out by Shaffer. Pure In rem still allowed.

McGee v. International Life Insurance Co. U.S. Sup. Ct. 1957

(Π) insurance beneficiary v. (∆) insurance co.

Cause of Action: (Π) claimed life insurance $ from (∆) company which refused to pay. (Π) sued in California where the
insured was a resident. (∆) claimed the court didn’t have jurisdiction because the company had no office or agent in
California.

Ruling: Residents of California would be at a severe disadvantage if they were forced to follow the insurance company to a
distant state in order to hold the company legally responsible.

Rational: Sufficient for purposes of due process that the suit was based in a contract the substantial connection with the
state.

contract was delivered in CA

premiums were mailed form CA
Insured was a resident of CA

INTEREST OF THE STATE – interjected into the case

Hanson v. Denckla Sisters v. sisters – over deceased mom’s estate 1958

Family fight over the assets of a mother who had established a trust fund in Delaware and some years later, moved to
Florida

Had to get jurisdiction over the trustee

if Florida courts have jurisdiction → one sister gets all

if Delaware courts have jurisdiction → three sisters split evenly

Issue: whether the Florida court could acquire jurisdiction

(∆) trust company had no offices in FL, transacts no business, and has no solicitation
Mom did transfer domicile to FL and conduct trust administration
The trustee performed no acts in FL

Outcome: there was no act by which the (∆) company purposefully benefited itself of the privilege of conducting activities
within the state.
(∆ ) must have directed and purposeful act which avail the (∆ ) to the benefits provided by the jurisdiction.

World-Wide Volkswagen Corp. v. Woodsen 1980

(∆) New York car distributor v. (Π) Family car owner

Cause of Action: (Π) attempted to sue dealer, distributor, and importer

Procedural Context: Filed in state court, Oklahoma Trial court said there was jurisdiction, could appeal
immediately, so (∆)s filed petition to the OK Supreme Court, which denied to limit jurisdiction. Cert granted by the
Supreme Court of United States.

Facts: World-Wide was incorporated and its primary place of business were in New York. Accident occurred in
Oklahoma and (Π) was not a resident

Rationale

Minimum Contacts will be weighed against the “reasonable or fairness” of a possible suit

burden on the (∆)

Forum State’s interest
(Π) interest of relief
Interstates interest
Social policy

Foreseeability alone is not sufficient for personal jurisdiction (unless you know the product is going to serve a specific
market within the state)

(∆) must avail himself to the privileges and benefits of the state laws

Procedural Result: (∆) did not have the contacts necessary, nor was foreseeability presence = no jurisdiction

Asahi Metal Industry Co. v. Superior Court U.S. Sup. Ct. 1987

(∆) tire valve manufacturer out of Japan / Sells to Cheng Shin

No claim because of fairness

Cause of Action: (Π) Gary Zurcher lost control of his motorcycle after the rear tire blew out.

The accident, which occurred on a California highway, killed his passenger/wife.

(Π) filed a product liability action in the Superior Ct. of Cal. against numerous defendants of the motorcycle.
All but Asahi were settled or dismissed.
 Issue: Whether the mere awareness on part of a foreign (∆) that the components it manufactured, sold, and
delivered outside of the U.S. = stream of commerce which constitutes “minimum contacts” such that the exercise
of jurisdiction “does not offend ‘traditional notions of fair play and substantial justice.’” International Shoe Co. v.
Washington.

Procedural Context: In an affidavit from a manager which did business with Asahi, said that Asahi was fully aware
that his company did a large amount of business with the U.S. The President of Asahi said that he had never
contemplated such.

- On this basis, Superior court denied motion to quash summons.

- Supreme Court granted certiorari, and now reverse

Rationale: “Substantial connection” necessary for finding of minimum contacts must come about by an action of
the (∆) purposefully directed toward the forum State.

Placement of a product into the stream of commerce, without more is not a purposeful act of the (∆)
Purposeful acts include

Advertising in the state

Designing the product for the market in the state
Establishing channels which provide service within the state
Burden on the (∆) v. Interests of the forum state

Seeks the most efficient resolution of controversies and the shared interest of several states in furthering fundamental social
policies World-Wide Volkswagen.
Burden on (∆) is severe: must come from Japan to submit to the California courts; must submit its dispute with the foreign
tire manufacture to a foreign national’s judicial system.
Interests of (Π) and the state are slight: the transaction between the companies in the stream of commerce occurred in
Taiwan, the components were shipped from Taiwan to Japan; (Π) is not a resident of California.
Where World-Wide Volkswagen considered the procedural and substantive polices of several states, this court would be
considering the policies of several nations

Procedural Result: Exercise of personal jurisdiction by a California court over Asahi in this instance would be unreasonable
and unfair.

This was one case in which the minimum contacts were significant, but the jurisidiction was so unfair, that jurisdiction was
not warranted

Burger King Corp. v. Rudzewicz

(Π) Fast food chain v. (∆) franchiser

(Π) Headquarters in Florida, Regional offices in numerous areas.

(∆) Investor with franchise in Michigan (dealt with Michigan Office)

Summary: (∆) Rudzewicz entered into a partnership with (∆) MacShara. Both were to purchase a Burger King
franchise and slip the profits evenly. (∆) MacShara was to be the operations manager and (∆) Rudzewicz was to
provide over $1 million in working capital.
 (∆)s negotiated with both the local district office and with the headquarters in Miami Florida and received a
franchise. They were trained in Florida and bought equipment from Florida. Business went sour and payments to
the (Π)company fell behind.

Cause of Action: (Π) sued in federal district court in Florida (invoking both personal and trademark jurisdiction).

Procedural Context: (∆)’s challenged personal jurisdiction. District Court rejected their challenge; Judge awarded
(Π) damages and injunctive relief.

Court of Appeals: Reversed based upon a Florida statute which said (∆) did not have reasonable notice of
jurisdiction and was financially unprepared for the prospect of litigation in Florida.

Supreme Court: Reversed; (Π) wins

Rationale:

Where a forum seeks to assert specific jurisdiction over an out-of-state (∆) who has not consented, the “fair warning” is
satisfied if:

the (∆) has “purposefully directed” ( contacts ) his activities at residents of the forum and;
the litigation results from alleged injuries that “arise out of or relate to” those activities

“foreseeability of causing injury in another State” is not a sufficient benchmark for exercising personal jurisdiction. World-
Wide Volkswagen.

Foreseeability critical to due process: (∆)’s conduct and connection with the forum state are such that he should reasonably
anticipate being haled into court there.

(∆) must present some evidence of other considerations which render jurisdiction unreasonable IF (∆) has purposefully
directed his activites at forum residents

Find jurisdiction unconstitutional

Forums laws clash with the “fundamental substantive social policies.”
(∆) can claim a substantial inconvenience for change of venue.

An individual’s contract with an out-of-state party CANNOT automatically establish “minimum contacts” in that foreign
state.
The franchise grew out of a contract which had “substantial connection with that state. International Shoe. Co.
(∆) negotiated a long-term contract with a Florida corporation
(∆) voluntarily accepted the long term contract, which emphasized Burger King’s operations were conducted and supervised
from the Miami office.
Decision making authority was vested in Miami; district offices served as an intermediate link.
(∆)’s were experienced and sophisticated businessmen than at no time acted under economic duress or disadvantage
imposed by (Π).

Procedural Result: Reversed. Jurisdiction enforced.

 Washington Equipment Manuf. Co. v. Concrete Placing Co.

(Π) machinery sales v. (∆) buyer.

(Π) – Washington corporation. Sale took place in Washington

(∆) – Idaho corporation; obtained a statutory mandated certificate to do business in Washington.

Cause of Action: (∆) obtained a certificate of authority to build two roads in Washington in 1985 and 1986.

In 1994 it bought a concrete placing machine from a (Π) Washington corporation; (∆) refused to pay the full
purchase price; (Π) sued to recover balance of the purchase price.

Procedural Context: Washington trail court dismissed the complaint for lack of jurisdiction. (Π) appeals.

Issue: Does a foreign corporation consent to general personal jurisdiction by securing a certificate of authority to
do business and appointing a registered agent? NO

Rationale (consent to General Jurisdiction)

Nothing in the Washington Business Corporation Act states, or implies, that by complying with these mandatory
requirements a foreign corporation consents to general jurisdiction in Washington.
When the Legislature has wanted to impose jurisdiction, it has said so
Consent, including consent to general jurisdiction requires some knowing and voluntary act.

Rationale (Waiver)

A (∆) waives the jurisdiction issue by asserting affirmative relief.

forum non conveniens is NOT a claim for affirmative relief.

Rationale (dismissal with prejudice)

Dismissing a claim with prejudice because of lack of jurisdiction only affects (Π)’s ability to renew the claim in that
specific jurisidiction.

Specific Jurisdiction: appropriate when a particular action arises out of, or relates to, the foreign
corporation’s activities in the state.

General Jurisdiction: unrelated to the corporation’s specific activities in the state. Focuses on
whether the foreign corporation’s general business activities in the state are substantial and
continuous. (usually limited to state of incorporation and primary place of business)
forum non conveniens Lat. Inconvenient forum. Doctrine which allows a court which has jurisdiction
over a case to decline to hear the case out of fairness to the parties if there is another court available
which would be more convenient

Burnham v. Superior Court U.S. Supreme Court, 1990

Husband v. Court where separate wife lives

Summary: While visiting his children at his ex-wife’s home state, (∆) husband was served with process of service
in an action to recover damages from their separation agreement. Husband challenged jurisdiction

Procedural Context. (∆) appeared specially, moving to quash service. Cal. Superior court denied the motion. Court
of Appeals denied mandamus relief (mandamus Lat. We command. A writ or order, issued by courts only in
extreme necessity, to a public official or corporation, commanding the performance of some public duty required
by statute.) Court held that the fact he was present within the state was adequate.

Issue: Whether the Due Process clause of the 14th Amendment denies California Courts jurisdiction over a non-
resident, who was personally served process while temporarily in that State, in a suit unrelated to his activities.

Presidential value: Need to know both of the opinions; no majority opinion; all the justices just agreed with the
outcome.

Public Policy: did not want to subject visiting parents to jurisdiction of court and discourage visitation of kids;
court came up with a different way of asserting jurisdiction.
 Scalia Opinion – International Shoe test was created to substitute presence when the (∆) is not present. No reason
to apply the International Shoe test to actual presence. Actual presence is always valid. Criticizes Brennan opinion
because benefits might not be as evident in a 15 minute visit.

Brennan Opinion – International Shoe test should be used. Presence gives notice to the risk that the State will
exercise its power over his person and property while there.

To determine Jurisdiction

Look at the state’s LONG-ARM STATUTE

Are there MINIMUM CONTACTS If the contact does not arise directly out of the actions, is there
enough to satisfy fairness?

Directed / Purposeful acts by the (∆)

Foreseeable that the (∆) would be haled into court
FAIRNESS

burden on the (∆)

Forum State’s interest
(Π) interest of relief
Interstates interest (social policy)
Efficiency

Federal courts are subject to the jurisdictional laws of the state in which it sits.
 Insurance Corp. of Ireland v. CBG

(∆) Insurer (from Ireland) v. (Π) person insured

The court has jurisdiction to determine jurisdiction, as the (∆) had submitted itself to defend itself on
the matter of jurisdiction. Didn’t enter a special appearance = had to comply with discovery

Forum selection clause – agreeing that any litigation will be heard in a specific court. Often
occurs in international contracts.

If a representative is appointed to receive process, a waiver of jurisdiction is assumed, but

jurisdiction is not required.

Carnival Cruise Lines v. Shute

(∆ ) cruise v. (Π ) injured customer

If you consent to / waive jurisdiction you cannot renig on that agreement.

Shute purchased tickets from travel agent in Washington

Cruise headquarters in Florida
Cruise departs form California
While on the cruise, (Π) was injured
Cause of action for injury filed in Washington; forum selection clause stated all claims would be brought in California
(Π) argue that the non-negotiable forum clause was against Due Process; prevented the (Π) from having her day in court.

Constitutional Requirement of Notice

Mullane v. Central Hanover Bank & Trust U.S. Sup. Ct., 1950

(Π) special guardian for beneficiaries v. (∆) trust fund

 - State statute allowed for a mere publication of notice as to the possible beneficiaries of a trust
fund.

Bank cannot give notice by publication when they had previously given notice by mail and currently had their addresses

Constitutional standard of what is fair:

Must choose a forum which is reasonably certain to inform those affected, where circumstance do not reasonably
permit such notice, the next best thing is require.

Publication OK when

Supplemental to another form

Large number of persons / not practical
Interests are hypothetical

Notice fundamental to Due Process

Must reasonably convey the required information

Must afford reasonable time to respond

Rule 4. federal Rules of Civil Procedure

A. Summons

Signed by the clerk

Bear the seal of the Court
Identify the court and the parties
Directed to the (∆)
Name and address of (Π)’s attorney
Time (∆) is to appear
Notification that failure to appear = default judgment
Issuance

Copy must be signed and on file

Copy issued to all (∆)’s named
What is served

Summons served w/ copy of the complaint

Must be served by a non-affiliated person at least 18 years-old. If court directs, service can be by U.S.
Marshall
waive service; duty to save costs

(∆) who waives service does not waive objection to venue or jurisdiction
(∆) expected to waive service if

in a foreign state
in a foreign country
corporation
if (∆) waves he has 60 days to respond as opposed to 20

(∆)’s whom it is impermissible to get a waiver

Infants
The United States and it agencies, corporations and officers
Foreign, State, or local governments
Proof of service

Person effecting (if not a U.S. Deputy) must provide an affidavit making proof thereof
Failure to make proof of service does not affect the validity of the service.
Time limit for service – if service is not effected within 120 days of filing the complaint, the court may dismiss the claim without prejudice to
the (∆)

Self-Imposed Restraints in Judicial Power:

Long-Arm Statutes, Venue, and Discretionary Refusal of
Jurisdiction
Situations in which the Courts or Legislature have framed rules that restrict

where a lawsuit may take place – even when the Constitution does not.

Long-Arm Statutes as a Restraint on Jurisdiction – statutes that allow a state to reach

beyond their own boarders.

For laundry-list long arm statutes – first see if the (∆)’s actions fall within the “laundry list” imposed by
the legislature.

Gibbons v. Brown Florida Dist. Ct. of Appeals, 1998

(∆) driver (Texas Resident) v. (Π) wife (Florida resident)

Background: while driving together in Canada, Mr. Brown gave Ms. Gibbons faulty directions resulting in a head
on collision.

Ms. Gibbons sued Mr. Brown in Florida court

Two years later Mrs. Brown sued Gibbons in Florida court for injuries sustained in the accident claiming

Mrs. Brown is a resident of Florida

Ms. Gibbons had subjected herself to the personal jurisdiction of the state by bringing the prior lawsuit.

Issues:

(Π) has not shown that (∆) “is engaged” in any activity in this state whatsoever other than defending the present suit.
2 year length of time between the commencement of the two suits
In the prior suit, Mrs. Brown was NOT named as a party.

Procedural Outcome: (Π) has not alleged a satisfactory ground for personal jurisdiction. Trial court directed to
DISMISS the complain

To establish In personam jurisdiction over a non-resident:

(Π) must allege sufficient jurisdictional facts to bring the (∆) within the coverage of the states long-arm
statute (facts must be substantial and not isolated)
Whether sufficient “minimum contacts” are shown to comply with due process.

Venue as a Further Localizing Principle

Flows solely from statutory sources

Typically tries to place suits in areas either connected to the parties or to the events giving rise to the
action
Locates not just in a state, but in a particular federal judicial district within that state.

Title 28 U.S.C. § 1391. District Courts; Venue Generally

Founded only on diversity of citizenship; District where

where any (∆) resides, if they all reside in the same state
substantial part of the events/property
(∆) was subject to the personal jurisdiction at the time the action was commenced, if 1 and 2 are not
satisfied
Not solely on diversity of citizenship; District where

(∆) resides
substantial part of the events/property
where the (∆) may be found, if 1 and 2 are not satisfied
Corporations; Districts where the corporation reside (if a state has more than one judicial district → the
districts must be treated as a separate state)

1. Subject to personal jurisdiction

where contacts are sufficient (incorporation, primary place of business)

d. An alien may be served in any district (personal jur. → serves as a check and balance )

Piper Aircraft v. Reyno U.S. Supreme Court, 1981

(∆) American airplane manufacture / (∆) Scottish air taxi

v. (Π) legal secretary for probate attorney appointed for decedents estates
 Summary: Small commercial aircraft crashed in Scotland killing the pilot and 5 passengers (all Scottish, as are all
their heirs and next of kin)

The airplane was owned and operated by a Scottish air taxi company.
British Dept. of Trade found no evidence of defective equipment.

Cause of Action: (Π) commenced separate wrongful-death actions against both (∆)s in the Superior court of
California. (filed in the U.S. because its laws regarding liability, capacity to sue, and damages are more favorable
to her position than in Scotland.

Procedural Context:

(∆)s first removed to federal district of California

(∆)s motioned for transfer to the Middle District of Penn (where (∆) Piper does business) then motioned for and were
granted a dismissal on the basis of forum non conveniens
Court of Appeals reversed reasoning that dismissal for forum non conveniens is never appropriate where the law of the
alternative forum is less favorable to the (Π)
Supreme Court Reversed

Rationale - forum non conveniens

if the remedy provided by the alternative forum is so clearly inadequate or unsatisfactory that it is no remedy at all, the
unfavorable change in law may be given substantial weight
Although the potential damages award may be smaller in Scottish courts, there is no danger that they will be deprived of
any remedy or treated unfairly.

Rationale – Gilbert analysis (connections, interests, and benefits)

fewer evidently problems would be posed if the trial were held in Scotland
Joinder of the pilot’s estate, Air navigation, and the Aviation Co. was critical to the (∆)’s case; if the (∆) could prove that
the action was caused by any negligence, the (∆) would be relieved of liability.
Public interest

Scotland has a strong interest in litigation

If in U.S. case would be confusing to the jury: Pennsylvania law would apply to one (∆) and Scottish law would apply to
another.
American interest is not sufficient to justify the enormous commitment of judicial time and resources.

Procedural Outcome: REVERSED (and dismissed?)

Forum non conveniens - Lat. Inconvenient forum. (common law doctrine)

Doctrine which allows a court which has jurisdiction over a case to decline to hear the case out of fairness to the
parties if there is another court available which would be more convenient.

Private “Interest factors”

Ease of access to sources of proof

Availability of forcing unwilling witnesses
Cost of obtaining willing witnesses
Possibility of view of premises, if appropriate
Any other practical problems

Public “Interest factors”

Administrative difficulties flowing from court congestion

Local interest in settling local disputes
Trial of a diversity case that is at home with the law that must govern the action
Avoiding unnecessary problems with a conflicting laws or the application of foreign laws
Unfairness of burdening citizens in an unrelated forum with jury duty

Civil Procedure Week 10

State Courts as Lawmakers in a Federal System

28 U.S.C. § 1652. Rules of Decisions Act

The laws of the several state, except where the constitution or Acts of Congress otherwise
require or provide (federal question/statute), shall be regarded as rules of decisions in civil
actions in the courts of the United States, in cases where they apply.

Swift v. Tyson

Furnishes a rule obligatory on the court to follow the decisions of state tribunals in all cases which they
apply
Decisions of the state courts do not constitute laws, at most they are evidence of what the laws are
Swift became a charter of judicial independence, a declaration that the Federal courts could ignore state
law even when sitting in cases that were not explicitly governed by federal law.

________________________________________________________________

Erie Railroad v. Tompkins U.S. Supreme Court (1938)

(∆) train v. (Π) walking man

Summary: man was walking along the (∆)’s tracks, with several feet between him and the
tracks. As a train passed, a door swung open and hit the (Π), knocking him under the train; his
right arm was severed.

Under Penn. Law, Tompkins was a trespasser and the railroad was only liable for “wanton”
negligence.

Procedural Context: (relying on Swift v. Tyson) the federal district court instructed the jury as to
“general law” that the railroad was liable for only “ordinary negligence”.

Jury verdict for the (Π)

 (∆) appealed; 2nd Circuit upheld the decision

U.S. Supreme Court granted certiorari

Issue: Whether the federal court was free to disregard the alleged rule of Pennsylvania common
law.

Ruling: No

Rationale:

Swift v. Tyson held that federal courts exercising jurisdiction based upon diversity of citizenship need
not in matters of general jurispridence, apply the unwritten law of the State as declared by its highest
court; that the federal courts are free to exercisr an independent judgement as to what the common law
of the state is.
State courts followed their own opnions on questions of common law which prevented uniformity
among states. Now there was incertainty as to both general law and local law.

Diversity of Citizenship was conferred in order to prevent discrimination in state courts against non-
citizens.
Swift v. Tyson introduced grave discrimination by non-citizens against citizens.

________________________________________________________________

Guaranty Trust Co. v. York

(∆) bond trustee v. (Π) bond holder

Summary: (Π) bond holder sued trustee in a federal diversity action alleging misrepresentation
and breach of trust.

Procedural Context: (∆) invoked the New York statute of limitations.

(Π) argued the statute of limitations did not bar the suit because it was on the “equity side” of the
federal court.
The courts had not thought of themselves strictly bound by the statutes of limitation
Circuit court ruled the (Π)’s suit was not barred.

Ruling: Supreme Court reversed.

in all case where a federal court is exercising jurisdiction solely because of the diversity of citizenship
of the parties, the outcome of the litigation in the federal court should be substantially the same

*** *** *** *** ***

Page 280, note 5

Case Federal Law State Law Who won

Regan, 1949 action commences commences when (∆) is state (outcome

when complaint served determinative)
filed

Cohen, 1949 (Π) had no bond to (Π) must post bond in a state law (not outcome
post shareholders derivative determinative)
suit

Bernhardt, enforce arbitration didn’t have to enforce state (possibly outcome

1956 agreements in determinative, not to a
interstate commerce. CERTAINTY)

Woods, 1949 state of out-of-state state → cannot bring even

incorporation corporations cannot use in federal district court in
determines (Rule the court system if they the state (not outcome
17B) don’t pay taxes determinative)

*** *** *** *** ***

Outcome determinative test:

Need to look at the state law in conflict with the federal law

Is that law bound up in the rights and obligations of the parties → yes, apply state law.
Even if you determine state law should be applied, federal interest can still trump state law

De-Constitutionalizing Erie

________________________________________________________________

Hanna v. Plummer

State law: if the suit concerns an estate → must be personally served

Federal law: can serve wife

Procedural Context: Trial court applied state law and granted (∆)’s motion for summary
judgment

Issues:

Rules Enabling Act: Legislature has the power to enact laws regulating practice and process of the
district courts.
Significant because
28 U.S.C. §2072: The Supreme Court shall have the power to prescribe general rules of practice
and procedure and rules of evidence for cases in the United States district courts (including
proceedings before magistrates thereof) and courts of appeals
Erie had two aims:

Discouragement of forum-shopping: would a (Π) because of the difference in law, force him to pick
state/federal court.
Avoidance of inequitable administration of the laws

Erie test (outcome determinative) was meant to cover a situation in absence of legislative power.

When you have legislative power to determine a case: only question

Is the exercise of that power Constitutional?

When you DON’T have legislative power (power has been delegated)

Is the delegation of the power constitutional?

Is the rule is within the SCOPE of the power given to the court to fashion the rule

Does the rule really regulate procedure?

Does the rule apply it.

If a matter of custom/practice and not law

“Outcome determinable” in Erie

does it discourage forum-shopping

Does it avoid it avoid inequitable administration of law

Case Federal Law State Law Result

Wood, 1987 Award costs to the Awards 10% No conflict. The court
winner of an damages and the could award the mandatory
appeal, and nothing costs %10 penalty for an
further unless unsuccessful appeal and an
frivolous additional damage if the
appeal was frivolous. State
law yields.

Stewart v. Forum selection: as Forum selection Not in conflict on its face.

Ricoh, 1988 defined by federal clauses are Court can use state’s
statute §1404 unenforceable opposition to forum
selection as a factor – but
only as a factor and perhaps
not a dispositive one. State
law yields.
Gasperini v. 7th Amendment: no NY statute: 7th Amendment wins. A
Center for reviewing court can reviewing court can district court can examine
Humanities, re-examine a jury change the award if it, district court can’t
1996 verdict doing so was (headache for professors to
reasonable figure out)
How does a federal court know what the state law is?

if there is no preseidnet → look at what state courts have done in similar circumstances
if presidence hasn’t been changeid in a long time

pierce – federal court followed state law; state later overturned the state law; court allowed the case to
be reopened
the reverse didn’t work, can’t reopen a state court case because the state law changed
Civil Procedure Week 11 Class Notes 4/4/2001

PAGE 894

1. A, a citizen of IL, sues B a citizen of IL, alleging that B violated federal civil rights statutes in firing
her. A seeks to add a state law claim Is there supplemental jurisdiction?

Rule 18 - (Π) can join as many claims as she wishes

Not diversity → must look at nucleus of facts, do they giver rise. §1367(a)

Yes they arise under the same facts

2. A, a citizen of IL, sues B a citizen of IL alleging that B violated federal civil rights statutes in firing
her. A seeks to join a claim that B caused injuries by backing into A in the company parking lot

Rule 18 - (Π) can join as many claims as she wishes

Not diversity → must look at nucleus of facts, do they giver rise. §1367(a)

No, they don’t arise under the same facts

3. A, a citizen of IL, sues B a citizen of IL, alleging that B violated federal civil rights statutes by
permitting sexual harassment. A seek to join C, the co-worker who engaged in the harassing behavior.

Assuming Rule 20 is satisfied

§1367 (a) allows for additional parties

4. A, a citizen of IL, sues B a citizen of WI for a breach of employment contract seeking an excess of
$75,000. A seeks to join C a citizen of IL alleging conspiracy (assume same nucleus of facts)

§1367 (a) satisfied; same nucleus

claim is not federal question, solely on diversity → look at §1367(b)
(Π) cannot bring a party in under 14, 19, 20, or 24 and the party will destroy diversity = NO GO.
 *** *** *** *** ***

A sues B for breach of contract,

I represent B
A made fraudulent representations
K induced by fraud = defense
B was damaged by the fraudulent representations = counterclaim
Allowede by Rule 13(a) and 13(b)

________________________________________________________________

Plant v. Blazer Financial Services

(Π) debtor v. (∆) lender

Original Claim: (Π) debtor sued (∆) lender for non-disclosure under the Truth-in-Lending Act
Counterclaim: (∆) lender sued (Π) debtor to get the loan $ back

Counterclaim – is it compulsory or permissive?

Court uses Logical Relation test

A logical relationship exists when the counterclaim arise out of the same aggregate of operative facts
Court finds the loan or transaction at issue gives rise to both claims

*** *** *** *** ***

What if (Π) sued (∆) for a skin rash from the ink from the paper.

*** *** *** *** ***

Passenger sues driver 1 and 2. Can Driver 1 state a claim against Driver 2, yes → cross-claim

Civil Procedure Week 12

Joinder of Parties by Plaintiff

________________________________________________________________

Mosley v. General Motors

(Π) 10 black and women workers v. (∆) employer

Summary: (Π) sued for damages arising out of discrimination in the work environment; that
each of the (Π)’s had been injured by the same general policy.
 Procedural Context: (Π)’s filed complaint with the Equal Employment Opportunity
Commission which made a reasonable cause finding against (∆)

Trial Court: separated the 10 separate counts into 10 individual actions finding that there was no
question of law or fact common to all the (Π)’s sufficient to sustain joinder; the incidents were
separate.

Appellate Ruling: Reversed; the 10 counts should be joined together

Rationale:

Purpose of Joinder: single trial = less time, less money

Under the rule of civil procedure the impulse is toward entertaining the broadest possible scope
of ation consistent with fairness to the parties; joinder of claims, parties, and remedies is
strongly encouraged

For Joinder:

claim must arise out of the same transaction or occurrence

depend on logical relationship rather than immediateness of the connection

logically related events = transaction/occurrence
must contain some question of law common to all the parties

Ruling:

Conclude that a company-wide policy purportedly designed to discriminate against blacks in

employment similarly arises out of the same series of transactions or occurrences

Discriminatory character of (∆)’s conduct is basic to the class, and the fact that the individual
members may have suffered different effects from the alleged discrimination is immaterial for
purposes of “same transaction”

*** *** *** *** ***

Derivative liability

(insurance - if you are liable for some act and the act is covered by your insurance
policy, then the insurance is liable to you for whatever you are found liable to the
injured party)

To establish Derivative Liability

(Π) → (∆)/3rd party plaintiff → 3rd party

must be some legally cognitive relationship between (∆)/3rd party plaintiff → 3rd party (can be tort,
contract, etc.)
must be the same relationship that makes the 3rd party liable to (∆) that makes the (∆) liable to the (Π)

NOT appropriate when the defense is “It was him, not me”
Appropriate where 3rd party plaintiff says “ If I am liable to the (Π) then the 3rd party is derivatively
liable and must inbure me for all or part of anything I owe to the (Π)”

________________________________________________________________

Watergate Condo Owners’ Assoc. v. Wiss Engineering

(Π) Condo Assoc.

(∆)1 Real estate co.

Cross-claim

(∆)2 Wiss

Engineers

3rd party

Claim

3rd Party (∆) Brisk

Issue: Whether (∆)/3rd party plaintiff’s third party claim is maintainable under Rule 14 (a)

Rationale: The acts which are involved in the main claim are separate and distinct form the acts
which arise in the 3rd party claim

(Π) condo assoc. claim against (∆) real estate = breach of contract in delivery of the specifications
3rd party claim deals with negligent performance of repairs, a separte event which occurred later in time
and specifically disclaimed in the the complaint as a basis of action

3rd party and (∆) Real estate did not share a common duty to the (Π).

More Complex Litigation

Page 918 note 2.

________________________________________________________________

Kroger v. Omaha Public Power District.

(Π) Kroger

Iowa

(∆) OPPD

Nebraska
Rule 14

Owen – crane owner

3rd Party (∆)

Inc. in Nebraska, Primary place = Iowa

Procedural Context

Kroger sues OPPD

OPPD joins Owen
Kroger sues/joins
OPPD files motion for summary judgment
Motion for summary judgment granted, now only Kroger v. Owen
Owen challenges jurisdiction; no diversity

Ancillary jurisdiction: if one claim concerns federal question then the (Π) can bring non-federal claims
so long as they are apart of the same nucleus of fact.

1367 not in effect at the time of the case – IF IT WERE

Kroger/ owen

do you have federal permission – yes

sub jurisdiction 1331 –no, 1332 no, 1367 a yes → same operative fact, 1367 b no → original claim
founded on diversity, 3rd party brought under Rule 14, and that is inconsistent with diversity. Claim
thrown out of federal court. The (Π) could not have sued owen origionally

*** *** *** *** ***

What if Owen sued Mrs. Kroger

permission under the rule → Rule 14, yes 3rd party (∆) can sue if it arises out of same facts
Power? 1331 no 1332 no, 1367 (a) possibily. 1367 (b) claim not brought by a defendant the exception
does not kick out the claim.

*** *** *** *** ***

What if in response to Owen suing Kroger, Kroger now sues Owen

permission yes rule 14

power? 1331 no 1332 no, 1367 (a) yes, 1367 (b) possibily Kroger is now viewed as a (∆), or Rules for
counterclaim
 *** *** *** *** ***

________________________________________________________________

Helzburg’s Diamonds Jewelers v. Valley West

Shopping mall entered into a lease for a jewelry store. In the K they promised not to lease to more than

(∆) made a motion to dismiss b/c (Π) failed to join Lords.

does the absentee have an interest

will he be impaired if he does not protect that interest → yes, satisfied 19a

Lords was not prejudiced → could bring is own suit, had an opportunity to intervene and it
chose not to.

Valley west was not prejudiced by the suit → major problem came from Valley West entering into 2
different contracts

*** *** *** *** ***

p. 936, problem 3

1. same nucleus of operative fact? → No, two separate K and transactions / Yes pertain to same mall.

If yes, to 1367(a), is (b) satisfied. No

Note 6, page 937

Susan, ex-wife. Mrs. Joseph Axt; Mary current wife, “Mary (Mrs. Joseph) Axt. Mary brings suit

(∆) Georgia phone company would want to join Susan with Mary as a compulsory party
Larry, beneficiary of spend thrift trust, California resident, (remainder to children)

Larry sues trustee, Illinois resident, seeking a declaration that the trust should be his
Trust would want to join children
Homer, husband & Wilma, wife are injured in a collision between a car driven by Wilma and a car
driven by Triandos.

In the jurisdiction the (∆) is only liable for the portion that is his own fault. Complete relief exists from
Triandos
19
Civil Procedure Week 13
Intervention
Intervention: Allows an unjoined party with strong interests in the litigation the power to insist
upon joinder.

Gives the interveining party the right to present arguments and evidence
The ruling is binding upon the previously unjoined party

Complicates and perhaps weakens parties litigation strategy

Makes settlement more difficult
(to extremes) turns lawsuit into a town meeting.

Intervention

Must be timely; intervener may not wait until the lawsuit is on the brink of settlement
Must have a “interest” in the property or transaction that is the subject of the suit.
“Interest” must be in some strong way of risk
“Interest” must not already be adequately represented by present parties

________________________________________________________________

Natural Resource Defense Council v. U.S. Nuclear Reg. Comm.

(Π) Don’t want to grant licenses without an impact statement / (∆) want licenses

Opposed Intervening Parties: American Mining (trade association), Kerr-McGee Nuclear Corp.
(potential license applicant)

Unopposed Intervening Parties: United Nuclear Corporation

Cause of action: (∆) NRC, federal commission, and (∆) NMEIA, New Mexico state
commission, were to be enjoined from issuing licenses for the operation of uranium mills in
NM without first preparing environmental impact statements.

American Mining and Kerr-McGee are potential recipients of the licenses

Action was to prevent the use of Atomic Energy Act of 1954 so as to avoid the requirement of
an impact statement for which the provision of the act was made.

(Π) Nat. Res. Def. Council:

NRC’s involvement in the licensing procedure, notwithstanding the delegation to the state NMEIA is
sufficient federal action, and the impact statement requirement is not elimited
If the impact statement is not required in the granting of licenses, the state program is in conflict with
the Federal Atomic Energy Act.
Procedural Context:

(Π)s filed suit

United Nuclear sought intervention; motion was granted, unopposed
5 other corporations filed motions to intervene; all denied on the ground that the interest of the parties
were adequately represented by United Nuclear
American Mining and Kerr-McGee appealed

Issue: Whether denial of intervention was correct. Must look to the standards set forth by Rule 24(a)
(2)

Whether the applicants have an interest which is the subject of the action

Movant does not need to have a direct interest in the outcome; only needs a significantly protectable
interest.
Immediate interest = issuance and delivery of the license
Consequence of the litigation (different from immediate interest) = imposition of required impact
statements and a possible injunction between the federal and state regulation agreement.
Both Am. Mining and Kerr-McGee have intrests

Whether the claimants are so situated that the disposition of the action would impair or impede the
applicants ability to protect that interest

“Imparement” = practical matter and not limitedto strictly legal consequences

Court not limited to a res judicata test (Lat. A thing already judged. Doctrine that a final judgment of a court is
conclusive against the same parties in any further, identical cause of action between the parties)

Whether the interest is not adequately represented by existing parties

Burden is on the petitioner to show that the representation of the parties may be inadequate
United Nuclear situatied differently than the other member of the industry because it was already
granted a license; has the defense of laches. (An equitable defense doctrine which prevents enforcement of a claim
or right which, because of neglect, lapse of time, and other circumstances, has resulted in some change in the condition or
relationship of the property or parties that is prejudicial to the adverse party.)
Divergence of the interest need not be great in order to satisfy the burden.
Value in having the parties before the court → bound by the result.
Trial court thought the intervention of the parties would make the litigation cumbersome. Appellate
holding applies only to the two appealing parties and not all that were denied intervention

Procedural Result: Reversed; motion to intervene granted.

*** *** *** *** ***

________________________________________________________________
Martin v. Wilks

Blacks v. Whites

Racial discrimination class action law suit.

3 separate lawsuits

NAACP and 7 black lawyers → City of Birmingham

Bench trial, consent decree, parties settled

Before settlement, B. Fire Assoc. moves to intervene; denied
7 white Firefighters → City of Birmingham

Sought injunctive relief; case was rejected on the merrits

Wilks (white Firefighters) → City of Birmingham

Reverse discrimination; Martin (black FF) moves to intervene

Martin argued that the same people who argued and loss at the fairness hearings in the NAACP case,
can’t now collaterally attack the ruling of that case

Procedural Context: District Court granted (∆)’s motion to dismiss. Appellate court Reversed
and Supreme court affirmed.

Ruling:

*** *** *** *** ***

Interpleader
Interpleader: stakeholder anticipates 2 parties will fight over the insurance $; stakeholder can
bring the two parties into court.

Stakeholder has the power to give the fund to the court and say “here you decide.” (Π) becomes
the (∆).

Two ways for a stakeholder to bring interpleader:

Rule 22
Statutory Interpleader

Issue Statutory Rule 22

Subject Matter Minimal diversity; need Complete Diversity; stakeholder must
Jurisdiction: only have diversity of have complete diversity with all the
Diversity two or more of the claimants
claimants

Subject Matter $500 in controversy $75,000+

Jurisdiction:
Amount

Personal Nationwide service of Need personal jurisdiction; service under

Jurisdiction; process Rule 4
Service of Process

Venue Residence of one or Residence of any claimants (if all from

more claimants one state); district where dispute arose;
district where property is; district where
any claimant found if no other basis for
venue.

Page 961 #4

Greta, Nebraska resident / Fred, Kansas resident / Chicago National Bank

STATUTORY: Sub. Diversity → ok / Amount → ok / personal juris → ok / venue → must be

in either NB or KS

RULE 22: Diversity → ok / amount → ok / personal juris → probably IL only / venue IL

Problems for next week. Page 257, 258 #1-12