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Civil Procedure Outline Fall 2010

Part 1: Personal Jurisdiction


I. Constitutional Limits in Litigation A. Jurisdiction power to declare the law 1. Legislative jurisdiction signifying a state or territory whose government has the power to make law within its bounds 2. Judicial jurisdiction the power of a court to render a judgment that other courts and government agencies will recognize and enforce a. Federal Courts two ways for them to obtain jurisdiction i. Cases arising under federal law ii. Diversity jurisdiction parties are from two or more states b. State Courts i. Courts hearing only specific subjects (limited jurisdiction courts) ii. Courts that can hear any cases of parties within the state (general jurisdiction courts) B. Filing a case 3 core issues must overlap to have a properly filed case: 1. Personal Jurisdiction 2. Subject Matter Jurisdiction 3. Venue C. Jurisdiction and the Constitution 1. Personal jurisdiction v. subject matter jurisdiction a. Personal jurisdiction power over the defendant b. Subject matter jurisdiction power over a type of case 2. Constitutional components regulating jurisdiction: a. Article III i. Authorizes the establishment of the system of federal courts ii. Section 2: sets the limits of federal judicial authority b. Article IV, Section 1 i. Requires that Full Faith and Credit be given in each State to judicial proceedings of every other State. ii. Ex: A sues B in OR; court rules for A and awards damages from B s assets; B has no assets in OR b/c he keeps all money in an out of state bank account; the other state would be obligated to uphold the first state s holding regarding B s liability to A. c. Fourteenth Amendment, Section 1 i. Due Process Clause: No State [shall] deprive any person of life, liberty or property without due process of law. D. The Constitution and Choice of Law 1. Constitution shapes U.S. litigation by dictating which set of laws a court must apply to a dispute 2. Article IV

a. Supremacy Clause: The Constitution and federal laws shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby

II. Personal Jurisdiction A. Personal Jurisdiction = the power a court has over a person 1. Does any court have jurisdiction over any person? B. General Principles 1. Natural principle of law = states have power over their citizens Ex: If I fight in Times Square, a suit can be filed against me in LA court 2. States cannot assert power over non-residents 3. Personal jurisdiction is a defendant centered issue a. plaintiff submits to courts power by filing complaint in that court C. Types of Personal Jurisdiction 1. in personam jurisdiction = litigates the rights and obligations of people a. allows complete judicial control over a person can seize bank accounts, property, etc 2. in rem jurisdiction = litigates cases involving property a. very few true in rem cases state seizing land for public use, for ex. 3. quasi in rem: courts power is predicated on seizure of property a. arises out of failure to gain in personam jurisdiction b. litigates rights and obligations c. allows seizure of in-state property for seizure D. How to get these types of jurisdictions from out of-state residents 1. In personam a. voluntary appearance b. personal service within state lines * very difficult to achieve 2. quasi in rem a. two things must be done to obtain 1a) constructive notice of process (news ad) 2a) attachment of property at outset of proceedings [i.] if a defendant has no property, there is no cause of action E. Pennoyer vs. Neff 1. Sets up a conceptual scheme of 3 elements a. power over defendants and property based soley on presence b. consent to proceedings via business agents or voluntary appearance c. notice of proceeings being intertwined with power 2. Asserts the limits to personal jurisdiction a. a person s rights and obligations cannot be litigated without their consent/knowledge of the proceedings (no in personam w/o personal service) b. a person s property cannot be attached to a proceeding without due process 3. Carves out exceptions a. status adjudication: a state can declare the status of its residents 1a. necessary for an abandoned spouse to get a divorce 2

not applicable to child support, alimony, etc b/c that s not status b. interstate commerce 1b. States have the right to require out-of-state businesses to appoint an in-state agent to accept service of process III. Personal Jurisdiction Defenses A. Collateral Attack 1. Defendant fails to appear default judgment against him 2. B/c of Full Faith and Credit, a suit of enforcement can be filed in defendant s owns state a. defendant can attack PJ during this trial 3. VERY risky loss of collateral attack = affirmation of default judgment B. Pre-Answers and Answers 1. Defendant can file a motion 12 which, among other things, can seek to dismiss based on lack of personal jurisdiction 2. This must be the ABSOLUTE FIRST thing filed in the case a. failure to file motion 12 first = waiver of this defense b. this defense is easy to waive because judges do not want to see it become a defense of last resort if the proceedings were truly a burden, you would naturally file this motion first because of said burden 3. Benefits of Pre-Answer vs. Answer a. pre-answers are shorter and easier to get done b. pre-answers buy time for the lengthier task of composing an answer IV. Modern Constitutional Framework of Personal Jurisdiction A. Specific Jurisdiction v. General Jurisdiction 1. General is the best to have a. defendant has substantial connections to the state b. court has power over any claim against 2. Specific arises when there is not substantial contact a. Court must look at (1) minimal contacts and (2) relationship of the claim to those contacts b. Court only has power over the if the claim meets those 2 standards c. International Shoe deals with specific jurisdiction B. International Shoe 1. Completely shifts framework of personal jurisdiction from the Pennoyer regime a. Shoe focuses on fairness and minimal contacts b. Pennoyer focused on presence; very rigid 2. [D]ue process requires only that, in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice. 3. Shoe develops a two pronged approach to personal jurisdiction a. minimal contacts

1a. in Shoe, minimal contacts are found in the continuous and systematic relationship with the State of Washington b. traditional notions of fair play b. these contact allow claims that arise out of the sales and solicitation by IS in that state---other claims that are not related to the contacts are not subject to adjudication in WA (fair play) c. if a corporation affords itself to the benefits of a State, it should also have to bear the obligations of that enjoyment C. McGee 1. often cited to show how expansive PJ has come 2. a continual single act that was solicited by the defendant = PJ a. the insurance company mailed a letter to the insured saying they d continue service b. all maintenance of the account continued from CA by mail c. even though this is one tiny contact, Personal Jurisdiction was allowed ** compare to a non-continual act such as selling a snowboard from TX to a CA resident on ebay- single transaction w/ no solicitation = no PJ D. Hanson 1. asserts limits to personal jurisdiction, even in a Shoe world 2. the unilateral act of a consumer cannot impose minimum contacts on the defendant a. the trust was set up with a DE bank by a PA resident b. the testarix s decision to move to FL does not allow FL court to have personal jurisdiction over the DE bank i. Defendant must personally avail itself to business in the state ii. remember the enjoyment of laws = obligations---here there was no enjoyment of laws V. Absorbing In Rem Personal Jurisdiction A. Schaffer 1. applies International Shoe standard to all cases eliminates distinctions b/w in rem, quasi in rem and in personam jurisdiction a. jurisdiction over a thing = jurisdiction over a person s interest in that thing b. quasi in rem is an elliptical way to unconstitutionally assert PJ on a person i. violates notions of fair play 2. Applies International Shoe standard to individuals and corporations 3. What did Shaffer decide? a. Pennoyer: If land is attached at the beginning of a suit, it's ok b. Shaffer: not ok because the claim would have to arise directly out of the property issue claims that do not arise out of minimal contacts are unfair 4. The LAW in Schaffer is often cited, but the application to the facts is not wellreceived most modern courts agree with Justice Brennan s concurring opinion i. directing a company that is incorporated in DE should = minimum contacts VI. Specific Jursidiction: The Modern Cases A. Worldwide Volkswagon

1. Defendants must purposefully avail themselves to minimum contacts w/ the forum State 2. The burden on the defendant to litigate in the forum State can t be unreasonable
a. Court must consider five factors in determining reasonableness ("notions of fair play and substantial justice") of extending personal jurisdiction: 1) Burden on the defendant (primary factor) 2) Interests of the forum state in adjudicating the dispute 3) Plaintiff's interest in obtaining convenient and effective relief 4) Interstate judicial system's interest in obtaining the most efficient resolution of controversies (not mentioned often) 5) Shared interest of the several States in furthering fundamental substantive social policies (rarely ever mentioned)

B. Asahi 1) Different parts have different effects on doctrine of PJ - Part I: facts and conclusion; unanimous binding - Part IIA: minimal contacts/stream of commerce plus; 4/9 not binding - Part IIB: fairness prong; 8/9 binding 2) As a result of fragmentation, Lower courts go either with Brennan or O Conner but there is not a nationwide consensus - Brennan s is more lax, so if you can fulfill O Conner s standards you are automatically fulfilling Brennan s 3) Minimal Contacts (Part IIA) a) O Conner: stream of commerce plus i. mere awareness of your product entering the stream of commerce is not enough there must be something else ii. O Conner s plus factors 1) designed the product for the market in the forum State ex: hurricane proof housing materials for gulf coast 2) established channels for support for the product in forum State ex: service dept. of car dealership 3) advertised in the forum State 4) market through a distributed that is targeting the forum State ex: hired a distributor to distribute cars to NY/NJ only b. Brennan: mere awareness that your product can reach the forum State is OK 4) Fairness a. clarifies that although if elements 2-3 (plaintiff and forum state s interest) are satisfied, a litigation that burdens the defendant may be OK i. Burden on the defendant (primary factor) - Def. is international very burdensome ii. Interests of the forum state in adjudicating the dispute - plaintiff is not a CA resident (no interest in aiding their res) - suit does not involve CA laws iii. Plaintiff's interest in obtaining convenient and effective relief - Plaintiff has not shown that it is more efficient to litigate in CA they are both international companies 5

iv. Interstate judicial system's interest in obtaining the most efficient resolution of controversies - All of the other cases have been settled, only this one remains v. Shared interest of the several States in furthering fundamental substantive social policies - tread lightly when dealing with international business

C. Burger King 1. Even though it is in federal court, the process doesn t change (still use Shoe) 2. minimal contacts = entering a continuing and wide-reaching contact w/ FL; reached out to enter a contract with a BK company (McGee) 3. most people think that Burger King has overruled part 4 of schaffer (application of law to facts) i. sophisticated business people reaching out to a company in the forum State ii. contract specifically stated that contract will be governed under FL law 4. Ct of App was concerned that PJ in this case could lead to future cases in which large corporations can sue consumers ex: I buy a dishwasher from Sears, who is in IL. If I miss a payment, Sears can sue me in IL for payment. a. Sup. Ct says that this is a narrow situation and that we still recognize the imbalance of bargaining power we will protect the little man from big corporations b. in modern times, we have already fallen down this slippery slope 5. Dissent a. Stevens believes that there are no minimal contacts and its unfair to make little franchisees travel to litigate in the forum State of the big corporation 6. court in Burger King painstakingly went through fairness prong showed that a very heavy burden despite min. contacts can = PJ and vice versa D. Pavlovich 1. forst internet case we have seen 2. Calder effect a. if effects of the defendant s conduct target the forum State, then you can find PJ b. lower courts have struggled to apply this in the same way that Brennan and O Conner disagreed about the stream of commerce in Asahi i. mere awareness of foreseeable harm vs. ii. mere awareness + purposeful acts to induce harm 3. Zippo Test/Spectrum a. does not replace the Shoe analysis simply a guide b. spectrum of internet sites posting information interactive, virtual storefront c. the lower a defendant is on the spectrum, the harder the case for PJ 4. CA court decided a. Pavlovich is on the low end of the Zippo scale 6

b. ruled for mere awareness of harm + purposeful acts i. Pavlovich had no purposeful acts ex: had he sold the code to CA residents to bring down the creeps in the Silicon Valley different ruling VII. General Jurisdiction A. General Jurisdiction always exists for: a. corporations principal place of business and state of incorporation (Shoe was in MO and DE) b. individuals domicile (one state only) (mine is LA) B. having general jurisdiction requires substantial, pervasive contacts in a state a. Perkins did ALL of their business from OH during the war gen. jurisdiction b. Helicopteros did LIMITED business in TX no general jurisdiction i. drew some checks, had a bank account, bought some stuff C. if general jurisdiction exists, the claims don t have to be related D. unless it is a slam dunk case (prin. place of business or incorp.), gen. jurisdiction is rarely found a. no guidelines have ever been laid out b. usually deal with the factual background on a case by case basis c. see Reynolds Tobacco case VIII. Transient Jurisdiction (Burnham) A. Burnham s wife serves him with divorce papers while he is on business in CA and stops in to visit his kids B. rationale in Burnham isn t binding b/c there was no majority, but they agree that tagging within a state is OK of personal jurisdictions C. Scalia historically, if a person is in a state, they can be served. 1. tagging within the forum State is sufficient grounds for PJ D. Brennan visiting a state = availing yourself to the benefits of that State = minimal contacts 1. since you are there, its clearly not a burden to travel there for litigation 2. tagging a visitor in state is sufficient grounds for PJ IX. Contractual Provisions that Affect Procedure A. contractual provisions are relevant to personal jurisdiction analyses, but they are enough on their own B. Choice of Law Clause: can file anywhere, but ___ state s laws apply (Burger King) C. Consent-to-Jurisdiction Clause: if you bring a suit in this forum, you have PJ but there is more flexibility D. Forum-selection clause: any dispute will be heard in ___ state. E. Arbitration Clauses: no longer able to file in court, put into a secretive, private arbitration F. cognovits clause: waives any possible defense; agree to a specific judgment to be filed against the defendant 1. valid if they are knowingly entered into 2. some States ban them or restrict the language used in the G. Carnival (forum selection clause) 1. cruise tickets had a forum selection clause and by accepting tickets, the plaintiff consented to this clause 2. Court must look at the reason for having the clause to decide if PJ is allowed 7

a. minimizes litigation costs for the defendant and they can (arguably) pass those savings on to customers b. guides plaintiff in knowing where to file (more efficient) c. limits the court s uncertainty (no need for Shoe analysis) d. defendant doesn t have an underlying malicious rationale for including it i. if the clause was there simply to hinder plaintiffs from being suit, the clause would not be enforced ii. bad faith negates the clause s validity e. contract was not entered into fraudulently, no deceptive practices from def. X. Notice A. To exert PJ must have power OR consent and over the defendant + notice 1. Pennoyer recognizes that you can consent after the suit 2. Carnival extends consent to allow consent before the suit even starts B. Notice is a distinct requirement of personal jurisdiction 1. not the same thing as PJ 2. you can notify someone of a suit and they can challenge PJ & win C. Personal Service vs. Transient Jurisdiction 1. Burnham allows someone to be tagged in a state in which the suit it filed in order to exert PJ on them (transient jurisdiction) ex: tagged for a CA suit while on business in CA 2. If you serve someone by in CA with a LA suit, that is not automatic jurisdiction a. the defendant must be subject to PJ of the LA State Court system (long arm + shoe analysis) D. Mullane establishes that defendants must be notified in the most effective, reasonable way and that the notice must be meaningful and convey pertinent info 1. req d bank to mail notice b/c it was no burdensome 2. today, Rule 4 statutorily governs notice rather than relying on case law E. Rule 4 1. formal service of process Rule 4(c) a. process server must be over 18 b. different means of service apply to different classes of people (corporations, government agencies, individuals, in the US, out of the US, etc) c. Individuals Rule 4(e) i. follow State law for serving for either the state the suit is filed in OR the state you are serving in ii. tagging personal delivery of a copy of the summons & complaint iii. leave a copy of the complaint & summons @ the usual abode w/ another resident of that dwelling of suitable age iv. delivery to an agent authorized to receive service of process 2. informal service of process Rule 4(d) a. send a copy of the complaint and a waiver of formal service via 1st class mail b. signing the waiver is an incentive to the defendant i. 60 days instead of 21 to answer the complaint ii. failure to sign the waiver w/o good cause = you pay for the costs incurred while formally serving you good cause is rare: didn t rec v it or don t speak English 8

c. signing the form does not cause the defendant to give up any defense ex: he can accept and then challenge PJ, or file a motion to dismiss d. defendant usually has 30 days to return the form 3. Statute of Limitations & notice a. Claims w/ federal law: clock stops on the statute of limitations when the lawsuit is filed b. Claims w/ State law: clock stops on the statute of limitations when there is service i. if you have a short statute of limitations (45 days or so), informal service is not the best idea b/c the clock doesn t stop until the def sends the form in which could be 30 days minimum XI. Long Arm Statutes A. Long arm statutes range in their authorzation 1. some authorize PJ up to the full extent of the Const. (Int l Shoe) 2. some give a list and limit the authorization of PJ (FL or NY for ex) B. Gibbons 1. FL Long Arm authorizes general jurisdiction a. engaging in substantial, non-isolated acts within a state lead to PJ in all claims no matter if they are related to the acts 2. Gibbons prior lawsuit does not constitute substantial, non-isolated acts. It was one lawsuit 2 years ago no PJ 3. filing a suit in a state usually gives your consent to PJ in that state for that case any counterclaims or appeals arising from that suit are subject to PJ in the state (Saenger)

Part II: Venue


I. Venue A. Venue is statutory, not Constitutional B. completely separate from PJ 1. subject matter jurisdiction, personal jurisdiction and venue must all overlap to have a properly filed suit C. 28 U.S.C. 1391 sets up 3 tests for deciding venue 1. Residency Test a. venue is OK in any judicial district where the defendant resides if ALL defendants reside in the same states 2. Transactional Test a. looks at the heart of the lawsuit b. look at where the events occurred 3. Fall Back a. transactions occurs abroad and both defendants live in different states b. only use if both other tests fail c. judicial district = any district in which one of the defendant s has PJ i. use a mini shoe analysis to decide Ex: A car accident in Baton Rouge - if both defendants reside in LA, you can be in an judicial district in LA o - if one of the defendants is out of state, it can be in the middle district b/c that s where the accident occurred D. Venue can be waived (Carnival/forum selection clauses) 9

II. Venue and Aliens A. Venue provisions are waived for aliens (any jud. district you want) B. When there are international and US defendants, the US s cannot piggy back on the aliens venue must separately analyze venue for the domestic s C. in Dee-K court used a transactional test (events occurred abroad) and found: 1. international defendants can go anywhere 2. minimum contacts for the E.D.Va. had to be proven for at least one defendant before they could proceed III. Forum Non Conveniens A. court has the discretion to dismiss a suit it the moving party ( ) can show 1. there is another viable forum, AND 2. the original forum is oppressive him, OR 3. there is more judicial efficacy in the other forum B. There is a strong presumption that the plaintiff s choice of forum should not be disturbed UNLESS the plaintiff is not from that forum state 1. as a result, most FNC cases have international plaintiffs 2. if the plaintiff is a US citizen, dismissal on grounds of FNC is rare C. Court balances factors to decide if dismissal is appropriate 1. Private factors (burden, oppressiveness) a. relative ease of access to sources of proof b. ability to summon unwilling witnesses c. cost of bringing in willing witnesses d. possibility to view premises (wreckage site, for ex) 2. Public factors (judicial efficacy) a. court congestion in the original forum b. local interest in deciding local controversies c. familartiy/complexity of laws, sometimes foreign d. unfair for jury to hear a case they have no local interest in D. FNC is very much docket control E. In federal court, easier to use 1404 to simply transfer to another court 1. 1404 is n/a to state and foreign courts

Subject Matter Jurisdiction


I. In General A. SMJ addresses the courts power of the subject matter of the case B. SMJ arises from Article III of the constitution 1. gives judicial power to establish lower courts 2. limits the lower courts jurisdiction a. we will focus on diversity and federal question, see below C. Unlike PJ and Venue, SMJ cannot be waived 1. SMJ deals with the state and federal courts relationships 2. PJ and Venue deal with the individual parties and courts relationships 3. only parties that are members of the relationship can waive jurisdiction II. Federal Question Jurisdiction (28 U.S.C. 1331) A. applies to actions arising under the Const., laws, or treaties of the U.S. 10

B. Mottley and the Well Pleaded Complaint 1. well pleaded complaint rule = federal claim must be clearly stated in the complaint 2. Mottley complaint (a) the defendant railroad co. entered into an agreemenr to provice the plaintiffs with a lifetime free pass (b) the defendant railroad co. breached its agreement (c) if the defendant argues it is prohibited from honoring the agreement b/c of the fed statute, the statute does not apply here (d) in case the defendant relies on the statute ad the statute applies, there is a due process violation 3. the complaint does not address a federal complaint the federal issues (bullets c & d) only anticipate 2 defenses of the defendant that may or may not arise 4. the heart of the issue is contractual (state law), not federal law C. Courts can bring up subject matter jurisdiction sua sponte (at any time, even though the parties don t) Hypos Which case belongs in Federal Court? 1. Worker alleges that an employer violated the Fair Labor Standards Act which est. minimum wages. Employer says he only worked X number of hours, and that is why his payment is lower; worker says that is wrong. a. the plaintiffs claim is based on Federal Law (Fair Labor Standards Act) federal question jurisdiction b. counterintuitive b/c the meat of the discussion will be how many hours he worked, whereas the other claim will need a lot of discussion on the 1st amendment 2. Plaintiff claims newspaper libeled her, and her newspaper relies on First Amendment protections. a. the plaintiff s claim is based on state law (defamation) no federal question jurisdiction y The Well Pleaded Complaint rule only applies to the arising under language in 1331, not the arising under language of Art. III of the Const. III. Challenging Subject Matter Jurisdiction A. Two Types of Motions to Dismiss -- 12(b)(1) motions to dismiss for lack of SMJ ex: there is no diversity, no jurisdiction in federal court -- 12(b)(6) motion to dismiss for failure to state a claim ex: the plaintiff s claim that the defendant stuck her tongue out at him is not a valid claim B. The 2 motions have different consequences 1) 12(b)(1) does not preclude the plaintiff from re-filing in state court 2) 12(b)(6) does preclude the plaintiff from re-filling * no claim means you can t file in ANY court C. ask about note 1c in notes

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D. Dismiss meritless claims pursuant to 12(b)(1), but if there is a reasonable claim, dismiss under 12(b)(6) Why? IV. Diversity Jurisdiction (governed by 1332) A. Must have parties residing in different states + over 75k 1. suits between aliens are not eligible for diversity 2. claim must be OVER 75,000 75k not allowed 3. Examples: Mexico v. Japan = no diversity California v. New York = diversity; 1332(a)(1) California v. Japan & Mexico = diversity; 1332(a)(2) California & Mexico v. Japan & NY = diversity; 1332(a)(3) California & Mexico v. Japan = no diversity B. Special Cases of Diversity 1. Permanent Resident Aliens a. domiciled in the state in which they have permanent res 2. Partnerships (law firms, for ex.) a. considered a collection of individuals b. must look at the residency of each partner 3. Corporations a. reside in their principal place of business (PPB), or b. state of incorporation c. will always have 2 residences, but they might be the same state d. tests for PPB i. nerve center test: executive and administrative functions controlled from nerve center (adopted by the supreme court) ii. muscle test 4. Minors and Incompetents a. residence is based on the residence of the minor or incompetent, not the person representing them C. Complete Diversity rule 1. required for 1332 2. no person on the plaintiffs side can be from the same place as another person on the defendant s side a. NY & CA v. NY not complete diversity D. Adding Parties 1. If a party is added unnecessarily to create diversity diversity is ignored E. Diversity cases can also be heard in State court F. Claim of over 75K 1. rarely challenged, but if it is there is a legal certainty test 2. an analysis of diversity in cases of injunctive relief is based on a. the benefit to the plaintiff b. the cost to the defendant 3. Courts can look at it from the perspective of the defendant, the plaintiff or the party seeking diversity

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4. Aggregation of Claims (multi count complaints in one law suit can you add the claims up to make 75K?) a. single plaintiff v. single defendant = yes b. 2 plaintiffs v. 1 defendant i. can t aggregate if the claims are distinct c. generally, if there are mutiple parties on either side, no aggregation i. exception multiple parties w/ a common interest (co-owners of a condo, for example) 5. Counterclaims a. compulsory counterclaims (arising from the same set of facts) i. counterclaims under 75k can be heard in federal court b. permissive counterclaims (nothing at all to do with the plaintiff s claims) ii. counterclaim must satisfy SMJ on its own Redner v. Sanders 1. Redner tries to sue in federal court under 1332(a)(2) saying that he is an alien b/c he resides in France a. Court denies this b/c Redner is a resident of France, not a citizen 2. Redner tries to backpedal and invoke 1332(a)(1) saying he is a CA citizen, thus diversity still exists a. Court says there is not enough info about his life in France to make this determination does he plan to return to CA, for example? 3. Test for State Citizenship = (a) U.S. Citizen domiciled in the State (i) domicile = physical presence + intent to remain there in definitely Saadeh v. Farouki Amendment to 1332: an alien admitted to the U.S. for permanent residence shall be deemed a citizen of the State in which such alien is domiciled Issue: Under a literal reading of this amendment, there would be diversity jurisdiction Holding: Court held that the legislative intent of the amendment was to restrict jurisdiction, not expand it Rationale: meant to keep local aliens from suing each other -i.e. French citizen living in NY invoking DJ for a suit with a Mexico citizen also living in NY - Constitution does not recognize suits between aliens Romania v. France no - Some courts will refuse to look at legislative history and will allow diversity jurisdiction in this case V. Supplemental Jurisdiction A. In multi claim complaints that have one claim that can independently satisfy SMJ (hook), the other claims may be heard in federal court in certain circumstances B. 1367 governs supplemental jurisdiction 1. 1367(a) grants jurisdiction to State claims that are so related to the suit that they cannot be dropped without consequence a. the state claims and federal claims share a common nucleus of operative fact 13

2. 1367(b) limits the jurisdiction that 1367(a) grants (repo clause) a. 1367(b) only applies to cases arising under diversity jurisdiction No supplemental jurisdiction for: i. claims by plaintiffs against persons made parties uner Rules 14, 19, 20 or 24, OR ii. claims by persons proposed to be joined as plaintiffs under Rule 19, OR iii. claims by persons seeking to intervene as plaintiffs nder Rule 24 AND iv. when exercising supp jurisdiction over such claims would be inconsistent w/ diversity 3. 1367(c) gives the court discretion to dismiss supplemental claims when a. the state claims involve complex, novel issues b. state claims overwhelm the federal claim (hook) c. district court has dismissed all other federal claims d. other exceptional cases In re Ameriquest Facts: Plainitff alleges a violation of TILA, a violation of the Michigan Mortgage Brokers, Lenders and Services Lending Act and a civil conspiracy claim Analysis of Supplemental Jurisdiction 1. Hook Claim = TILA violation 2. type of SMJ federal question *no need to look at 1367(b) Repo Section, so we just need to look at if the two state claims are related 3. Court says that a loose factual connections is enough, must share a common nucleus of operative fact a. another general rule of thumb: would a resolution or dismissal of the supplemental claim impact the resolution of the hook claim? Application: In this case, the State claims arise from a common nucleus of operative fact overpricing of the house, fraud, TILA tender amount can be offset if the judgments in the state claims favor the plaintiff (TILA tender = amt borrower owes back to the bank, State fraud claims would cause the bank to owe money to the borrower if the plaintiff is successful) ** also discusses 1367(c) see above

Szendrey-Ramos
Federal Claim: discrimination under civil rights statute State Claims: SJ Analysis 1367(a): hook claim is the discrimination under federal civil rights statute; state claims all relate to her firing 1367(b): Repo doesn t apply b/c the hook is based on federal question, not diversity 1367(c): 1. state claims involve complex, novel issues a. the state claims were novel to Puerto Rico i. novel confidentiality claim 14

ii. does PR make an exception to confidentiality when a lawyer sues their former employer 2. state claims overwhelm the federal claim a. the supplemental claims dominated over the 1 federal claim b. courts often look at the sheer number i. 5 supplemental claims vs. 2 hook claims c. scope of state claims exceeds the scope of federal claims lots of evidence needed for state claims 3. D Ct has dismissed all other federal claims (not an issue) 4. other exceptional cases (not an issue) VI. Removal A. To remove to federal court, 1. the case must satisfy the requirements of subject matter jurisdiction; 2. you must file a notice of removal containing a. a short, plain statement on jurisdiction b. all documents from state court c. shows that the 30 day window has not elapsed B. Limits and Rules 1. Defendant has 30 days to file for removal a. if an amendment or something changing the circumstances is filed, the 30 day clock starts running again 2. For diversity cases only after 1 year, you cannot remove 3. Forum Defendant Rule (1441(b)) a. only applies to diversity cases b. if there is a defendant that is a citizen of the same state in which the lawsuit is filed, you can t remove c. if the plaintiff originally filed in fed court, it can be there d. denial of removal based on there being no bias to avoid if the defendant is in state court in his home state 4. If you fake your citizenship, you will be sanctioned. C. Hypotheticals 1. defamation claim no, no SMJ 2. defamation claim where the parties are from different States yes, diversity 3. claim under the equal protection clause yes, federal question 4. personal injury claim for 100k between a FL plaintiff and a NJ defendant in a FL court yes, diversity 5. personal injury for 100k between a FL and a NJ in a NJ court no, forum defendant rule 6. same as 5 + a federal claim yes, forum defendant rule doesn t apply to fed question 7. FL sues NJ and NY on a personal injury claim of 100k in NY state court no, forum defendant rule D. Caterpillar v. Lewis 1. two givens in this case a. it was improper for the lower court to remove to federal court 15

b. complete diversity did not exist at the time of removal 2. Court held that even though removal shouldn t have happened, the case has been completely heard and decided in federal court and it would be inefficient to re-try the case a. the case had complete diversity in the end 3. In addition, even though there was complete diversity in the end, the 1 yr clock would have run by the time diversity existed Caterpillar, Inc. v. Lewis (1996) I. Background A. Facts 1. Parties of Original Lawsuit a. Plaintiff Lewis = KY resident b. Defendants Caterpillar, Inc (incorp in DE, ppb in IL) & Whayne Supply Co. (Kentucky) c. new plaintiff Liberty Mutual (Massachusetts) 2. Lewis was injured while operating a bulldozer manufactured by Caterpillar and the bulldozer s servicing company B. Pro Hist 1. Lewis filed this lawsuit in KY State Court (6/22/1989) 2. Several months later, Liberty Mutual joined in as a plaintiff 3. Lewis settled with Whayne 4. Caterpillar filed for removal a. explained that case lacked complete diversity and was thus unremovable at the start, but with the pending settlement with the other defendant, Whayne will be dropped form the suit and there will be complete diversity b. Lewis objected saying that Liberty had not settled with Whayne, thus Whayne was still a def. and there was no diversity i. Judge denied the motion to keep it in state court 5. Whayne and Liberty settled 6. The case went to trial with only Lews v. Caterpillar remaining a. ruled for Caterpillar II. Issue A. Is the absence of complete diversity at the time of removal fatal to federal court adjudication? III. Holding A. No, the DC s error in failing to remand a case improperly removed is not fatal to the ensuing adjudication if federal jurisdictional requirements are met at the time judgment is entered. IV. Rationale A. Lewis has a point when he says that allowing this to happen denied him of his right to stay in state court, however, the Erie case says that once a diversity case has been heard in federal court, considerations of finality, efficiency and economy overwhelm all other considerations 1. too burdensome and costly to re-try the case once it has been decided 16

V. judgment A. affirmed

VII. Erie Problem A. the Rules of Decision Act, 28 U.S.C. 1652 said that when there was a diversity claim in federal court, the laws of the several states will govern B. Swift interpreted this to mean statutes, but not state case law 1. as a result, if there was no state statute on point in the issue, federal judges applied a general law of their making 2. Swift reigned for 100 years 3. led to tremendous forum shoppinG C. Erie overruled Swift 1. Why? a. uproar created by Swift and the taxicab case i. taxi cab: a KY cab co. dissolved is corp and moved it to TN just to get diversity jurisdiction and avoid state law b. original theory behind Swift was to create a uniform body of general, federal law i. this never materialized c. scholarly research of the language in 1652 referred to case law and statutes d. discriminatory, unfair results i. citizens are subject to 2 bodies of law ii. result depends on whether you are in state court or federal court ii. out-of-staters could use Swift to discriminate against in-staters 2. Holding: Except in federal question jurisdiction, there is no federal common law. Congress does not have the power to create state law, then the federal judiciary obviously does not have the right to do so. Erie Railroad v. Tompkins (1938) I. Background A. Facts 1. While walking home near railroad tracks, the plaintiff was struck by a car door of the defendant s train, ultimately causing him to fall on the tracks and lose an arm. B. Pro Hist 1. Tompkins filed a negligence suit in federal court in SDNY against the railroad company.

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PA laws labeled him a trespasser and the RR was only liable for gross negligence 2. Trial judge, operating under the Swift standard, instructed the jury to consider the claim under general law saying the defendant was liable even if only guilty of ordinary negligence a. jury ruled for plaintiff b. 2d Cir Confirmed c. Supreme Court granted certiorari II. Issue A. Is the Swift doctrine an equitable application of the law. III. Holding A. No, 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. There is no Federal General Law. IV. Rationale A. Swift said that the judge could exercise whatever they think the common law of that state is, or should be 1. The Swift court misconstrued the Rules of Decision Act 2. made the uniform application of law impossible B. The Swift doctrine is bad law and the laws of the state that the court lies in should be governing even in federal court

VIII. Pleadings A. 3 (or 4) Eras of Pleadings 1. Common Law writs 2. Facts based heavily on facts 3. Notice short and plain statement a. low hurdle to get into court b. only enough fact to notify the defendant what the action is about 4. Plausibility a. Twombley now requires the facts laid out to plausibly of there being a case no facts ------------*-------------------------------**--------------------------***-------------------- lots of facts notice plausibility fact B. Pre-Answer Motion 1. can assert rule 12(b) motions 12(b)(1) no SMJ 12(b)(2) no PJ 12(b)(3) improper venue 12(b)(4) improper service 12(b)(5) improper service of process 12(b)(6) no cause of action 12(b)(7) failure to join a party 2. asking the court to do something for you 3. PROS: can buy time, much shorter C. Answer 18

1. must reply to every allegation in the compliant, line by line 2. can still assert 12b motions 3. very lengthy, detailed D. Special Pleading Rules 1. Rule 8 a. inconsistent claims and defenses are ok i. I was not negligent. If I was negligent, it was not the cause of injury. b. affirmative defenses are listed i. no need to plead affirmative defenses 2. Rule 9 a. allegations of fraud my be detailed 3. Rule 11 a. signing a complaint and later advocating it means you agree that 1. purpose of filing is not to delay or harass 2. legal arguments are warranted by law OR you have a valid argument to change the law i. the diversity is too hard to prove case 3. facts have support i. Mattell case 4. denials have support b. does not apply to discovery verbal misconduct c. not required to amend if you figure out something is wrong, but if you advocate that point later, you violate Rule 11 d. how to bring a Rule 11 motion 1. serve the violating party with a draft of the motion 2. give him 21 days to amend or withdraw 3. if no action -> file it with the court e. must be brought separately from other motions f. sanctions can be verbal, written, monetary, etc can be against the lawyer, the client or both are on the spot punishment

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