Civil Procedure

Civil Pr Procedure: ocedure: A.J.C. 2009 Types of Jurisdiction (1) In Personam  Jurisdiction  Jurisdiction

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b.

General Jurisdiction Jurisdiction: Occurs if if company’s company’s activities activities in a state are are of such a continuous and systematic systematic nature that the corporation’s relations to the forum state are no different than those of a resident.  Jurisdiction  Jurisdiction over any claim in in state, even one completely completely unrelated to in-state in-state activities. activities. Specific Jurisdiction Jurisdiction: Covers only the the specific act act which satisfied the minimum contacts contacts standard.

(2) In Rem Jurisdiction:  Jurisdiction: Juris asserted over a person’s person’s real or personal personal property in-state. in-state. Affects interests interests of all parties in a piece of property; suit is limited to the property itself. (3) Quasi In Rem Jurisdiction: Jurisdiction: Affects interest of one party in a property a. Type Type 1: Resol Resolves ves a dispute dispute about about the the propert property y itself. itself. b. Type 2: Establishes rights to property where the underlying dispute is not about about property. property. 28 USC § 1655 – authorized territorial jurisdiction jurisdiction for in-rem and some quasi in-rem cases. Applies to lien/titles existing prior to the suit & present in the district. IF the absent D doesn’t appear, the judgment only affects the property that is the subject of the action. Rule 4n2 – If PJ cant be obtained after reasonable reasonable efforts to contact D, ct may assert juris over D’s assets found in the district. Satisfying jurisdiction 1. Is it stat statut utor ory? y? a. State State long-a long-arm rm statu statute: te: Rule Rule 4(k)( 4(k)(1)( 1)(A) A) b. Bulge Bulge juris jurisdict diction: ion: Rule 4(k)(1)( 4(k)(1)(B)—fo B)—forr 3rd parties (r14) & indispensibles (r19) 2. Is it cons consti titu tuti tion onal al? ? a. Minimu Minimum m cont contact acts s (Int (Int’l ’l Shoe) Shoe) b. Reasonab Reasonablene leness ss test test (World-Wi (World-Wide de Volkswa Volkswagen) gen)

PERSONAL JURISDICTION Scope of Personal Jurisdiction • State law provides the the ultimate source of personal personal jurisdiction jurisdiction (Rule 4(k)(1)(A)) • Federal statute statute may also provide federal court court with personal jurisdiction jurisdiction as per Rule 4(k)(1)(C) • R4k2: If no state state can exercise personal personal jurisdiction, allows allows personal jurisdiction jurisdiction when case case arises out of federal law law • Limit: Due Process – 14th Amendment

I. General Jurisdiction: Jurisdiction: Systematic contacts (Hall) Presence (Tag Service) • Burnham - even after min contacts, presence still enough under 14 th Amendment ( Husband Husband visits kids for 3 days, served by wife) • Grace v McArthur  – served on plane flying over AK  • Darrah v Watson – sued in VA while on business for a few days Exception: • Force or Fraud 2R§82 – State wont exercise judicial juris. juris. obtained by fraud/unlawful force force over D/D’s property property Wynam v Newhouse – D had meritorious relations w/P. P wrote mother dying, entreated D to come, served in FL. • Immunity from service service of process process (when presence presence if purpose purpose of participating participating in another another lawsuit as party, counsel, witness) Domicile • Where a Person lives, lived, chooses to say indefinitely. Even if not currently in the state. – Milliken v Meyer  (served in another state) • Corporation – place of incorporation + primary business activities Consent – appearance, contract, seeking license to do business within the state

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 You can waive T. Jurisdiction, Jurisdiction, and appear to to contest if you wish. (most (most Δ probably won’t) won’t) Implied consent no longer valid – Hess - Driving car in MA appointed state official as agent = implied consent

II. Specific Jurisdiction Territorial Jurisdiction– When D is out of state (1) State-Long-Arm + (2) Constitutional under 14th Amend. Due Process (Minimum Contacts + Reasonableness) (1) Long arm statutes (Rule 4k1A): calls nonresident D back to state to defend ( Authorize jurisdiction of Δ based on specific types of contact)

Tortuous acts • Committed Within State: Nelson v Miller – PJ if tortuous acts occurred within state + P states cause of action • Committed Outside of State: If they foreseeable affect within the State intentional & allegedly tortuous actions were expressly aimed at CA Calder v. Jones - SC, 1984 Facts: Shirley Jones sues National Enquirer  in CA for libel about her drinking habits. Reporter lived in FL but traveled to CA often on business. Editor oversaw just about every function of the magazine. Rule: When Δ’s acts outside the forum have foreseeable consequences in the forum, jurisdiction is valid. Conduct from an injury inseparable from injury itself  Gray v American Radiator Facts: Manufacturer of valve (OH) – installed in PA – shipped to ILL – Injured P Constitutional : maybe not, bc no proof of any business conducted within the state  attempt to stretch long-arm statute to constitutional limits (1) Constitutional under Due Process Minimum contacts (# of contacts + level of relatedness) o Casual + isolated not enough. Need specific acts/continuous & limited acts to convey specific jurisdiction, and pervasive acts to convey general jurisdiction o “A corporation enjoying benefits/protection benefits/protection of laws of that state. The exercise of that privilege may give rise to obligations…”

>> Number of Contacts + Relatedness Int’l Shoe Co. v. Washington - SC , Casual+Isolated Casual+Isolated not enough – High contacts / High relatedness 1945 | 163 Facts: Π is a Delaware corp. w/ principal place of business in Missouri. Π employed 11-13 salesmen in Washington, commissions of $31K. Salesmen had one sample shoe per pair & w ould rent out store space. Π doesn’t want to pay into the states unemployment fund. expect/foresee suit, good reason to sue in state (activity arose in state), state interest to Holding: P availed self, could expect/foresee control disputes in state Rule: Consider “quality & nature of contacts” w/ state. Sometimes a single contact will do, but not contacts that are “casual” or “isolated.” Policy : Relationship between Δ, forum, and the litigation becomes the central issue . Perkins v Benguet Consolidated Continuous business activities – High contacts / High Relatedness (general juris) Mining Co Facts: Gen juris granted OH for Phillipines mining co during Jap invasion. President moved to Ohio =, maintained co matters, kept office files, correspondence, correspondence, 2 bank accounts, directors mtgs, drew salary checks 1 contact, high relatedness (specific juris) McGee v. Int’l Life Ins. Co. -SC , 1957 | s Facts: Beneficiary of life insurance policy secured from Texas company in California. Defendant had no contact with California except for solicitation of policy through the mail. Contract was delivered to P’s son. Holding: “It is sufficient for purposes of due process that the suit was based on a contract w/ substantial connection w/ CA.” Weighing State/P interests: State- protect citizens subject to K’s and insurance policies, P- inconvenience of travel to TX for suit

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 You can waive T. Jurisdiction, Jurisdiction, and appear to to contest if you wish. (most (most Δ probably won’t) won’t) Implied consent no longer valid – Hess - Driving car in MA appointed state official as agent = implied consent

II. Specific Jurisdiction Territorial Jurisdiction– When D is out of state (1) State-Long-Arm + (2) Constitutional under 14th Amend. Due Process (Minimum Contacts + Reasonableness) (1) Long arm statutes (Rule 4k1A): calls nonresident D back to state to defend ( Authorize jurisdiction of Δ based on specific types of contact)

Tortuous acts • Committed Within State: Nelson v Miller – PJ if tortuous acts occurred within state + P states cause of action • Committed Outside of State: If they foreseeable affect within the State intentional & allegedly tortuous actions were expressly aimed at CA Calder v. Jones - SC, 1984 Facts: Shirley Jones sues National Enquirer  in CA for libel about her drinking habits. Reporter lived in FL but traveled to CA often on business. Editor oversaw just about every function of the magazine. Rule: When Δ’s acts outside the forum have foreseeable consequences in the forum, jurisdiction is valid. Conduct from an injury inseparable from injury itself  Gray v American Radiator Facts: Manufacturer of valve (OH) – installed in PA – shipped to ILL – Injured P Constitutional : maybe not, bc no proof of any business conducted within the state  attempt to stretch long-arm statute to constitutional limits (1) Constitutional under Due Process Minimum contacts (# of contacts + level of relatedness) o Casual + isolated not enough. Need specific acts/continuous & limited acts to convey specific jurisdiction, and pervasive acts to convey general jurisdiction o “A corporation enjoying benefits/protection benefits/protection of laws of that state. The exercise of that privilege may give rise to obligations…”

>> Number of Contacts + Relatedness Int’l Shoe Co. v. Washington - SC , Casual+Isolated Casual+Isolated not enough – High contacts / High relatedness 1945 | 163 Facts: Π is a Delaware corp. w/ principal place of business in Missouri. Π employed 11-13 salesmen in Washington, commissions of $31K. Salesmen had one sample shoe per pair & w ould rent out store space. Π doesn’t want to pay into the states unemployment fund. expect/foresee suit, good reason to sue in state (activity arose in state), state interest to Holding: P availed self, could expect/foresee control disputes in state Rule: Consider “quality & nature of contacts” w/ state. Sometimes a single contact will do, but not contacts that are “casual” or “isolated.” Policy : Relationship between Δ, forum, and the litigation becomes the central issue . Perkins v Benguet Consolidated Continuous business activities – High contacts / High Relatedness (general juris) Mining Co Facts: Gen juris granted OH for Phillipines mining co during Jap invasion. President moved to Ohio =, maintained co matters, kept office files, correspondence, correspondence, 2 bank accounts, directors mtgs, drew salary checks 1 contact, high relatedness (specific juris) McGee v. Int’l Life Ins. Co. -SC , 1957 | s Facts: Beneficiary of life insurance policy secured from Texas company in California. Defendant had no contact with California except for solicitation of policy through the mail. Contract was delivered to P’s son. Holding: “It is sufficient for purposes of due process that the suit was based on a contract w/ substantial connection w/ CA.” Weighing State/P interests: State- protect citizens subject to K’s and insurance policies, P- inconvenience of travel to TX for suit

High contacts, High relatedness – even if didn’t step foot, could reasonably  foresee “reached out beyond” – VERY REASONABLE Facts: R buys a BK then stops making franchise payments. Deals w/ HQ in FL & district office in MI. R’s partner goes to BK  college in FL. It’s clear that any “real” negotiations will happen w/ FL office. 21-year ongoing business relationship. statute, allowing jurisdiction over “any person, whether or not a citizen or resident of this Issue: Will FL’s broad long-arm statute, state” who “breaches a contract in this state,” as long as action arises from the breach, hold up? Holding: R deliberately “reached out beyond” MI, establishing minimum contacts w/FL. Even though he didn’t step foot into FL, his business associate associate did. Further, this is not a case in w hich inconvenience of Π achieves “constitutional magnitude.” Thus, reasonableness test is passed. Weighing: Burden on D substantial but expected, high interest of state to regulate in-state business, interest of P – convenience & predictability Policy : There are no “talismanic jurisdictional formulas.” Indeed, dissent feels that R never “purposefully availed himself of  the benefits & protections of FL’s laws.”

Burger King Corp. v. Rudzewicz - SC, 1985 | 196

No Minimum Contacts High contacts, Unrelated (no specific juris) Helicoperos Nacionales v. Hall - SC, 1984 | 188 Significant contacts, but not significant enough for general juris. : Columbia helicopter company hired on a Texas pipeline venture in Peru. T hey go to TX to get the deal, buy Facts choppers in TX &Court train their forconsent the venture TX. Copter crashes in Peru. , 1979in | sTX. Money Tacit is not notcomes direct from availment/be availment/benefit nefit (unilateral not enough) enough) Kulko v. Superior - SCpilots : Δ’s contacts notmoves sufficiently systematic. Plus, contacts didn’tinarise out of ormore relate to the Holding : Couple divorces in w/ NY,TX wife to CA.continuous Gradually & the kids join her there. Wife sues CA court for child Facts cause of action. support. : (against Due Process) noavailment? regulatory interest – esp toward negligence claim, P didn’t have Weighing State/P Interests Does his tacit consent to the move constitute direct Issue: good reason to sue Holding: P was not purposefully directing self to or availing self of CA – this was unilateral act by wife/kids. No benefit. Note: If diverse proceedings were in CA, there would be PJ

>> Directly Availed vs Tacit Concent Directly Availed: • McGee – one letter delivered to son • Burger King – repeatedly reached out, could reasonably foresee • International Shoe – purposely availed state’s protection/benefits protection/b enefits • Perkins – president reached out continuously  No Direct Availment (Unilateral Acts) • WW Volkswagon – had nothing to do with OK  Mullane v. Central Hanover Bank - SC, 1950 Beneficiaries didn’t directly avail self  | 281 Facts: Judicial settlement of a pool of small trust estates; beneficiaries notified by publication, per NY banking law. Reasonableness : D’s receive benefit, but likely don’t even know that trust is in their name. No purposeful availment. State interest: ease of administrating over funds in-state

>> Stream of Commerce + Unreasonable (burden on foreign D’s too high) • Gray - Manufacturer of valve (OH) – installed in PA – shipped to ILL – Injured P – Jurisdiction Jurisdiction allowed Unreasonable & Foreseeability STREAM OF COMMERCE CONTROVERSY. Asahi Metal Metal v. Superior Superior Court - SC, 1987 | 212 Reasonableness not met. Unsure if Min contacts met but Reasonableness : Asahi As ahi (Japan) (compone (component nt manufacturer) makes valves. Cheng Shin (Taiwan) puts valves on tires. tires. Gary Zurcher Facts crashes Honda motorcycle, sues Cheng Shin, which indemnifies Asahi. Z & CS settle. CS’s case against A remains. STREAM OF COMMERCE CONTROVERSY: Judges aren’t in agreement and you can argue either way • Some judges say: “Mere Awareness” is enough • (minority) O’Connor O’Connor Test: Awareness Awareness + Directly Targeting Targeting State (ie: (ie: marketing) Property in State – must still establish minimum contacts Old case For Quasi-in-rem jurisdiction, property must be attached. Pennoyer v. Neff - SC, 1877 | 147 Constructive notice not enough except for personal status (ie: divorce) (OVERRULED) You cant be served outside the state Facts: Mitchell sues N in Oregon state ct for $253.14. Service is by publication for 6 successive wks in the Pacific Christian  Advocate. N did not appear. Default judgment against N for $294.98. N’s Oregon property attached & sold at sheriff’s sale to M for $341.60. M sells to P for undisclosed amt. Holding: Power Theory – States don’t have authority over people through in-state property unless the property is 1 st attached (brings under ct. control) process. Rule: Fourteenth amendment: Due Property isn’t sufficient to establish PJ when its not related to claim (Quasi-in-rem Type Shaffer v. Heitner - SC, II) 1977 | 250 Quasi-in-rem, In-rem, and In-personam distinctions no longer matter! Facts: H. sues Greyhound officers & directors for violating their duties. H fil es quasi in rem type 2 suit against Δ’s shares in DE (unrelated to claim). The weird thing: these guys are all officers & directors of a DE company, so in personam  jurisdiction might should apply, but DE law bases jurisdiction not on Δ’s fiduciary role, but rather on the presence of their property. (They changed this after the suit) Rule: “all proceedings are against people” Holding: Claims must be sufficiently related to property. Presence of the property alone does not constitute minimum contacts & reasonableness. 

Kulko v. Superior Ct , said it also applies to individual as well as corporations

“Concurrent jurisdiction” – State ct can hear any case that can be heard in fed ct (unless Congress makes exception). Not true vice versa. Does State have PJ? (over parties) • Domicile – Milliken v Meyer  • •

Presence – doesn’t apply to corporations (when reps travel through), in state service (Burnham) Consent ( privilege of the D, which can be waived) – appearance, contract, seeking license to do business within the

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Territorial – Long-Arm-Statute (in-state tort, etc) + 14th Due Process (Min Contacts + Reasonableness) Corporation – incorporation, doing business (corporate presence), consent  Necessity – Mullane (all beneficiaries)

state

Does Federal have PJ? • Rule 4k1a: Only if state also has PJ • Exceptions: Federal Statute can authorize, NECESSITY: no juris of any other state, or joined parties from Rule 14 of 19 w/in 100 miles of ct  Does State have SMJ? (over actions) • General matter jurisdiction - over most claims – ie: tort, battery, K breach Does Federal have SMJ?F • Only if granted by Article III and Congress §1331 ( cant be waived) • (OR) Only if diverse §1332 (+Amt in controversy $75K) Is venue proper? §1391 (a) Diversity – (1) Any district any D’s “resides” if all from same state, (2) Substantial events/property, (3) (Fallback) PJ of any D (b) Not Diversity (1), (2), (3)(Fallback) where any D can be found (c) Corp – “Resides” where PJ (and in that district only) Minimum Contacts: General Jurisdiction • Natural Persons – domicile • Corporations – incorporation, doing business

Reasonableness Interest of the forum state to provide redress to citizens  Burden on D 

Specific Jurisdiction • Claim arises out of / relates to contracts • Foreseeability • Who initiated the contacts? • Purposefully directed • Stream of Commerce

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P’s interest in proceeding in this forum Interest of state in efficient conflict resolution (substance) Shared interest with other states in furthering substantive social policies (procedure)

1) State interests: provide redress (YES) protect enforcement of K’s and insurance policies for its citizens (McGee) (YES) regulate in-state business (Burger King) (YES) ease of administration of funds in-state (Mullane) (NO) – no regulatory interest of TX over crash in Peru, esp in a negligence claim ( Helicopteros) (NO) – little state interest to regulate b/c state law doesn’t deal with indemnity cases with foreign manufacturer ( Asahi) 2) P’s interest in proceeding in this forum (YES) inconvenient for insurance co. to travel to TX from CA (McGee) (YES) convenience & practical – for suit to be litigated in FL headquarters ( Burger King) (YES) trustees received benefits, but likely don’t even know that the trust is in their name (Mullane ) 3) Burden on D – (NO) High but expected b/c could forsee that negotiations would happen in FL office franchise from MI ( Burger King) (YES) Severe burden on foreign D ( Asahi) 4) Further social policies – focus on substance – ie: a tort law concerning reckless driving.. 5) Shared interest w/other states in efficitn conflict resolution – focus on procedure • Would other states have a legitimate beef with the state doing this? • Where are the witnesses located?

Challenging Personal Jurisdiction Full Faith and Credit Clause in Article IV, § 1 (US Constitution) – fed has to accept judgment in state court 28USC § 1738 – state must give same effect to a valid judgment that is has in the state that rendered the  judgment. ***So state courts don’t have to give full faith & credit to Fed cts!! – the preclusion effect of that  comes from common law (therefore, parties can appeal and get review from higher cts)

Special Appearance •

Some states will allow you to make a special appearance to challenge the personal jurisdiction without subjecting yourself to personal jurisdiction –  you must be careful not to raise anything on the merits or   you subject yourself to ct’s juris

Collateral Attack  • •

If an out of state defendant does not appear and suffers default, they are able to collaterally attack the  judgment’s validity based on jurisdiction when action on judgment made. (challenge in the enforcement action) Risky – once defendant suffers default, they only have ability to attack jurisdiction, and lose ability to challenge on the merits. Note: You cant challenge PJ in enforcement action if you’ve already challenged in original action

In Federal Courts: • •

Ability to challenge jurisdiction, (if loses) litigate merits, and preserve right to appeal both jurisdiction and merits Must raise 12(b)(2) at start– otherwise waived right to challenge

§ 1331 Federal Questions/Cases (SMJ) Article 3 permits jurisdiction over any case where federal law is an “ingredient”. It establishes the judicial system and the power given to the SC and inferior courts. USC 1331 is a statutory limit placed by Congress that limits the power of courts to hear federal cases. Under 1331, district courts have original jurisdiction over civil actions arising from the Constitution, laws, treaties of the US. Constitutional Power - Article III Federal Statutory Power - 28USC1331 • Federally chartered (e.g., Bank of US) or incorporated (e.g., Red Cross) groups can have fed Q jurisdiction even re: state claims • Holmes test “a suit arises under the law that creates the right of action” • Fed law creates (1) right sued for (enough on its own) + (2) right to sue (not enough on its own)

Well-Pleaded Complaint Rule  The well-pleaded complaint r ule applies to original, not appellate, ju risdiction. It is quite broad: under Osburn v Bank of  the US, it only requires that one party rely on federal law to establish the claim, defense, or side federal issue proving the main case. Holmes attempts to clarify the requirements of this concept by stating that “a suit arises under the law that creates the right of action”. Grable & Sons v Darne further stipulates that state claims that turn on a substantial question of federal law have SMJ. Louiseville & Nashville RR v Motley sets forth the rule of the modern “well-pleaded complaint rule”. Louisville & Nashville RR. v. Motley - SC, 1908 | 349 The “well-pleaded complaint” rule Facts: Ms released claims in exchange for lifetime RR passes; Δ reneges claiming that the free passes are a violation of recently enacted federal law. “Breach of K” claim clearly state claim. Rule: (1) Its not enough that a federal issue is raised in complaint, it must be necessary to the complaint. (2) Claim must have federal issue – its not enough that D’s defense contains federal issue – creates “race to the courthouse” Policy: Otherwise, people can just insert fed issues into complaint when not necessary. Docket control. • Can be overinclusive in application b/c can bring a suit on federal claim, but may not end up litigating on that in the end.

Bell v Hood  You don’t need a valid claim for SMJ Facts: Bell seeks to recover damages from FBI agents Hood for imprisonment/wrongful search and seizure in violation of Constitutional Rights under 4th & 5th Amend. Issue: Is jurisdiction defeated by possibility that averment might fail to state a cause of action? Holding: No. Failure to state claim = judgment on merits, not dismissal for want of jurisdiction. SMJ must be granted before judgment on merits can occur. • Can only dismiss when “wholly insubstantial/frivolous”. As long as there’s possibility of good claim, you’ll survive 12b1. You don’t need valid claim for SMJ.

§ 1332 Diversity Jurisdiction Diversity jurisdiction confers federal jurisdiction over parties that meet the requirements in 1332. The first requirement is that the amount in controversy be greater than $75,000. This is a flexible requirement. P’s only need to show that this figure can be met to a reasonable possibility. Per St. Paul Mercury – this can only be defeated if the D can show to a “legal certainty” that the P cannot recover this amount. For additional confirmation, courts can hold a mini-hearing to determine this. Policy: Diversity jurisdiction is allowed b/c it avoids the prejudice of out-of-state parties being tried in state courts. Cons: s to this are that it consumes resources, fed judges have no ‘special expertise’ with state law, it can create friction between state/federal courts, reduces the pressure to improve state jud. systems

Aggregation Under the old rules (pre-1990), multiple plantiffs could not aggregate their claims unless it was a common/undivided interests (ie: co-owners). This was difficult to meet. Snyder v Harris disallowed aggregation of claims in class actions where no single person met the minimum amount. Zahn v International Paper (a class action suit) also dismissed litigants who’s separate/distinct claims didn’t satisfy the minimum. Under the modern rule, per Allapattah and Star-Kist, parties can aggregate their claims as long as one party meets the minimum. § 1332b: Amount in controversy test > $75,000 “to a reasonable possibility”  • St. Paul Mercury – defeated only if shown to “legal certainty” that cant recover = good faith a. 1 P can aggregate all claims brought in a single complaint (to single or multiple D’s). b. Modern Rule : if one party meets minimum, parties can aggregate their claims Aggregation was not allowed b/c parties under minimum amount. However, both cases were successfully joined because of  supplemental jurisdiction. Exxon Mobile v Allapattah – class action aggregation allowed b/c Rule 23 not exempt from §1367b – only one party met  juris amt “contamination theory” Star-Kist – 9-year-old sliced hand on tuna can – family tried to join on emotional distress/med – Rule 20

§ 1332a: Diversity - Litigation between (a)(1) - Citizens of different states - - (must be UC citizen or legal resident alien) (a)(2) - Citizens of a State & citizens/subjects of a foreign state. (a)(3) - Citizens of different States and in which citizens/subjects of a foreign state are additional parties; (a)(4) - Foreign state as a plaintiff. (not defendants) • Citizenship is contemplated at commencement of litigation • As long as all D’s and all P’s are diverse, its ok if D’s or P’s are from same state (Strawbridge)

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Citizens of a state = Domicile s ec People: Presence + Intent to stay indefinitely Associations: any state where there are members, Trust: only the state of the trustee, Unemancipated minor has same domicile as parent (R of conflict of laws §22), Corporations:§1332 (c) (1) : citizen both principle place of business/place of incorporation Principle place of business = place of operations, bulk of corporate activity test, nerve center, total activity test o Action against insured: citizen of state where citizen, and incorporated, and principal place of business o Baker v Keck Motive doesn’t matter, domicile established by actions/surrounding circumstances 1936 Facts: P (OK/IL) filed conspiracy suit against Progressive Mine Workers (OK). P has farm in IL but claims had moved to OK for domicile Rule: Look to acts/circumstances and not to person’s declaration to determine domicile Holding: Worked on community project, registered to vote, participated in local activities – enough to prove intention to reside in OK even though there was evidence that he intended to return to IL. Look at acts not speculation! Kelly v US Steel Bulk of activities test, (not where final decisions are made) Corp Facts: P = PA citizen. D (USX) incorporated in NJ w/ principal place in NY or PA. NY: BOD, Chairmen & Execs meets there, central place of publications/decisions. PA: General operations: 32% of employees, 33% tangible property, 35% total productive capacity Rule: Look to bulk of activities, day-to-day corporate activity

§ 1441, 1404, 1406 Removal & Transfer § 1441 REMOVAL  The 1789 Judiciary Act was the first time Congress introduced removal. Per 1441(f), a fed ct is not precluded from hearing a case even if the state ct that transferred it lacked juris over it. Its an action intended to protect both parties – either can choose to remove to a fed ct in the same district where the state action is pending (stays within state), as long as the dc has original jurisdiction under 1331 or 1332, and as long as D is not is in his home state (he doesn’t need to be protected from prejudice). A 1331 claim can be removed regardless of the citizenship/residence of the parties. Under 1441(c), the entire claim is removed even if joined w/ separate and independent claims, although the TC can exercise discretion and remind/remove the state question claims if they want. 1446 governs the procedure for removal. Removal confers venue, regardless of whether or not venue would have been proper under 1391 if the case had been brought in federal ct initially. Per the unanimity rule, all D’s must agree to remove.

Does new court have SMJ? 1331 – can remove regardless of citizenship 1332 – diversity req. must be met Cant remove if D is in home state Removal – confers venue (Holds even if that fed ct would not have been the proper venue under USC§1391 if case had been brought in fed ct initially §1441(a): REMOVE to fed ct that (1) W/ original jurisdiction (SMJ) under §1331 statute) and §1332 (diversity) (2) To a fed ct in the district where state action is pending. (STAYS WITHIN STATE) • Unanimity Rule: ALL D’s must agree to remove! If they disagree, they cant move. Limits §1441(b): D cant remove if he’s in his home state - doesn’t need to be protected from prejudice. **Exception: Federal claims (1331) can be removed regardless of citizenship/residence of parties §1441(c) – Entire claim is removed even if joined w/ separate/indep claims (otherwise non-removable).  Trial Court can exercise discretion and reman d/remove state question claims if they want. §1445 – Exceptions on Removal

§1446 – Procedure for Removal – (a) short/plain st, (b) Within 30 days - If claim didn’t assert fed q (not initially removable), notice of removal can still be filed within 30 days o f amended pleading, motion or order that would make it removable

§ 1404 TRANSFER Venue TJ

convenience of parties & witnesses Interests of justice

§1404(a) One DC in fed system to another in diff state or district. (CAN MOVE OUT OF STATE) • Transferor law governs (old state) – Van Dusen v Barrack  - prevents forum shopping. - Ferens v John Deere – transferred from MI (SOL was okay), to new state, (SOL had run out). New state had to apply MI law so he’s ok • Transfer for inconvenience to parties AND witnesses • Must be where action could originally be heard – Hoffman v Blaski – Hoffman v Blaski – D transferred to place where he had affirmatively moved to recently, but didn’t have proper venue @ time of suit. Cannot transfer where couldn’t have originally brought suit. Otherwise, D would have more power and could move the action theoretically anywhere – could lead to discrimination & harassment. • If, after removal, still the wrong court = Piper Aircraft Co. v. Reyno (1981) forum non conveniens • Courts use this as a way not to unduly prejudice parties whose claim may be barred by statute of limitations if dismissed for lack of venue (keep alive to avoid SOL to run) §1406A – Transfer from wrong ct ( without territorial juris) (tho venue can be proper) – •  Transferee law governs • Allows for cases field in wrong court to be transferred in interest of justice • Initial court can transfer, even if lacks jurisdiction – Goldlawr v Heiman Forum nonconveniens – harder to show bc dismisses the case entirely & parties must bring up themselves in another district • State can transfer to other state. However, typically this is only used in fed ct where party wants to transfer out of country.

Venue restricts where P can sue, assures suits are tried where there is sensible relationship *Is D’s privilege and may be waived by failing to raise at response (12b3, 12gh) §1391 (a) Venue when Juris founded on Diversity 1. Where any D “resides” if all in same state 2. Substantial part of events or omissions occurred (or property is located) 3. FALLBACK - Where any Δ is subject to P. jurisdiction if above places cannot be met § 1391 (b) Venue when Juris not founded on Diversity 1. Same as (a) 2. Same as (a) 3. FALLBACK  - Where any Δ MAY be found (if above cannot be met) § 1391 (c) – Corporations “reside” in any judicial district where PJ can be established. If state has multiple districts, PJ is restricted to the district of (1) PJ or (2) most contacts.

Focus on judicial districts/ NOT states Reside only in your domicile OR, Reside (for venue) in several districts if many residences maintained. Forum selection clauses upheld generally (agreeing in advance on venue) (even if its an improper district under 1391) See Carnival Cruise v. Shute (1991) Exceptions to 1391 venue:  Copyright  Patent infringement 1400b  Federal officials  Interpleaders  CL: local actions where land is located! • If judge feels venue is inappropriate for justice, may transfer through 1404a even if parties like the venue §1406 Removal for Improper Initial Venue

Erie

1789 Rules of Decision Act (RDA), stated that federal courts would apply the “laws of several states” Rules Enabling Act of 1934: 28 USC § 2072 2072(b): “Such rules shall not abridge, enlarge or modify any substantive right. All laws in conflict with such rules shall be of no further force or effect after such rules have taken effect” Swift v. Tyson - SC, 1842 | s450 Use Statutory, not Common Law Facts: Tyson purchased land using a bill of exchange. The bill of exchange was then given to Swift, Tyson refused to pay alleging that he had been fraudulently induced into purchase. Swift sues Tyson. Issue: Was exchange for endorsement valid consideration? Under NY law – no. Fed law – yes. Holding: Ruled that Judiciary Act of 1789, §34: "the laws of the several states, except where the constitution, treaties or statutes of the United States shall otherwise recognize or provide, shall be regarded as rules of decision in trials at common law, in the courts of the United States, in cases where they apply." – only applied to statutory, and not common law • Asks judges to look @ common law to reach independent judgment as to proper rule. • Supposedly, uniform common law rules would evolve as body of “general common law” on similar issues accumulated. This failed. • In Black & White Taxicab – introduced discrimination in favor of out-of-stater by allowing them to pick fed law Use state law on “substantive issues” where there’s no federal-making power & where states have authority to create ite Erie RR v. Tompkins - SC, 1938 | 455 Use Statutory + Common Law Prevent forum shopping + inequitable administration of laws. Facts: T gets hit by a train. Negligence case. T forum shopped to use fed law’s “ordinary negligence” rather than PA law’s “wanton negligence” Holding: The damage of brushing aside the law of a state in conflict with their views is too great for federal courts to continue in the Swift v. Tyson model. Fed courts should follow the state’s substantive law. Use PA law and threw out case. • State law governs: standard of care to trespasser, enforceability of Ks, validity of wills, property transfers • Swift overstepped constitutional boundaries b/c allowed federal courts to regulate matters Congress couldn’t regulate under Constitution – state judicial decisions are binding • Twin Aims: prevent forum shopping + prevent inequitable administration of laws • Confirms existence of “judicial judge-made law” • Problem b/c corporations could create diversity by incorporating in another state Dissent: This is judicial activism, overruling the Swift  regime City Services v Dunlap - 1939 Expanded Erie to extend to “procedural issues”  Burden of proof on validity of title on the land – SC found that this burden of proof “relates to a substantive right”, even though it’s a procedural issue. Policy: Crap, do we abandon Federal Civil Rules of Procedure for State ones now? Klaxon v StentorFed cts should use State “body of conflict” laws to determine which state’s law to 1941 apply  Case brought in DE over breach of K, performance of K was in NY. “Body of conflict” law dictated NY law should apply. Fed cts should resort to each state’s “body of conflict” laws – principles they look to when they need to choose which State law to use for “substantive” issues. Policy: Ensures “vertical uniformity” between state/fed cts within each state, but destroys “horizontal uniformity’ among fed cts in diff states. P’s can choose btwn fed cts in diff states to get diff results. Note: A state court may choose another state’s substantive law, but they will KEEP THEIR OWN PROCEDURAL LAWS. After a transfer, the original cts “statute of limitations” will apply

“Substantial procedures” are not “substantive”, they’re still Procedural & Fed Laws Apply  (FRCP) Medical exam = substantive or procedural? Substantial + procedural. Sibbach- 1942

(Fed. judicial practice) The outcome determinative test  (Statute of limits = substantive) Facts: 1942 suit in equity for fraud in connection w/ transactions that took place in 1931. If state statute of limitations applied, case would be dismissed. But, if federal statute of limitations applied, the case would continue. Issue: Whether to apply the strict NY stds for statute of limitations or to apply the more flexible doctrine of laches of fed cts Holding: Consequences that intimately affect recovery should follow State law. Policy: The outcome in federal court should be substantially the same as it would be if tried in State court. Promotes consistency within State. Dissent: “As form cannot always be separated from substance in a work of art, so adjective or remedial aspects cannot be parted entirely from substantive ones in these borderland regions.” Guaranty Trust Co. v. York - SC, 1945 | 466

Bernhardt v Polygraphic Co. of America Used outcome determinative test to trump Fed Law 1956 Issue: Whether federal court sitting in diversity should enforce the Federal Arbitration Act, passed by Congress, where it conflicts with a state law that contradicts it. Holding: Didn’t use fed law despite it being within Congressional power and obviously applicable. Instead, it used outcome determinative test to determine that Erie concerned trumped federal law. Narrowly interpreted fed statute to avoid Erie complications. Confirmed people’s “worst fears” about the uncertainty in the wake of Erie. (Federal statutes and FRCP were in risk because of Erie jurisprudence under Guaranty Trust) (Fed statute) Balancing test (Weight Fed > State interest) - principle still used --Affirmed that Fed cts follow State law for “substantive rights” if they’re outcome-determinative Facts: State law would allow judge to det. Employee’s status in tort . 7th Amendment - Federal law which would permit the jury to det. His status. Holding: Federal interest in preserving the character and function of juries in federal courts outweigh the concern that applying federal law would lead to different outcome than if state law applied. Policy: Power momentary swings back to Fed a little Byrd v. Blue Ridge Elec. Coop. - SC, 1958-473

PART I: Goal of Erie is to prevent forum shopping/inequitable dist. PART II: FRCP win unless they “abridge or modify substantive right” (REA) Facts: Mass. Required in-hand service, but P served process by leaving sit at home with person of suitable age and discretion as per the federal rule 4(d)(1) Holding: Rule 4(d)(1) doesn’t exceed the REA/Constitution, it’s the one that should be followed. Outcome determination test is to discourage forum shopping. Rules: When Federal trumps State Law  Article III, § 1: congress has the power to establish lower federal courts  Article I, § 8: and make law “necessary and proper” for exercising that power. NOTE: also there is statutory power since Congress reviews FRCP before taking effect, See 28 USC § 2074 Hanna v. Plumer – SC, 1965 | 479

(1) Federal Constitutional Provisions– Constitution governs via “Supremacy Clause” – (ie: jury verdict Hanna) -A fortiodi – if a federal constitutional provision applies, it will control despite a contrary state statute/practice US Const Article VI §2 (what kind of test does this need? Why do we end up applying Hannah II to this p.210 glannon?) (2) Federal Statute –

Is there a conflict btwn State/Fed? - If not, use Hanna I test  Is Fed statute “arguably procedural” - if so, follow Fed statute b/c Congress has power to enact procedural governing statutes You could try to avoid trouble by arguing that there is no direct conflict (ie: Walker/Gasperini) Ie: governing burden of proof, jury instruction, etc. (3) Federal Rules (FRCP) –

Does Rule “really regulates procedure” (valid under REA) - it rarely wont  Does Rule “abridge , enlarge or modify” a substantive right (REA§2) Substantive Law = “judicial process for enforcing rights and duties” - Is is “bound up” with the substantive claim itself? ie: giving longer life to claim –Walker, type/measure of damages Erie, statute of limitations -York ) - Pt of statute to govern a non-procedural matter? Or aimed at augmenting efficiency of litigation process? Ie: primary rights outside the ctroom, incidentally affecting them is sometimes ok - Does it favor one party over another? - Does it trench on the policy underlying the state’s approach? (4) Federal Judicial Practice – “modified outcome-determinative test” – Would applying the judge-made law lead to major forum shopping? Inequitable administration of the law? - if so, use State law Ie: inequitable = when Fed law instead of state would open up significant diff. in litigation opportunity, viewed

prospectively

Szantay v Beech Aircraft Corp Balancing all three approaches (York, Hanna, Byrd) Representatives of Szantay (decedent in Illinois) brought suit against Beech (Delaware/Kansas) and Dixie (South Carolina) in federal district court in SC. SC “door-closing” law that prevented a foreign party from suing a foreign corporation on a foreign cause of action. (crash in TN, service in SC)

Outcome Determination (York) – Does refusing to apply SC statute materially affect outcome? YES, you can sue in Fed but not State ct Modified Outcome Determination – (Hanna) – Would this lead to forum shopping/inequitable distribution of laws? Not enough to outweigh federal concerns Do federal interests outweigh state interests (Byrd) – Fed: avoid discrimination, convenient forum, State: weak – Fed wins **We end up on the Federal Side Day & Zimmerman v Challoner Repudiation of balancing approach for Klaxon’s “choice of law”  Πs injured by exploding shell while fighting in Cambodia sued maker of the shell in Texas federal court. Texas conflict of laws rule applied a “place-of-the-injury” rule, so technically should apply Cambodian law on proof of  negligence. Holding: Adhere to Klaxon’s “conflict of laws” determination: “A federal court in a diversity case is not free to engraft onto those state rules exceptions or modifications which may commend the federal court, but which have not commended themselves to the State in which the federal court sits.” . Outcome determinative test (Hanna Part 1)  Use state law Inequitable to allow suit to go forward in fed ct that would be barred in State  The car accident happens, filing is made withi n the state statute of limitations, but D not served within the statute of  limitations. Issue: Kansas has a 2 year statute of limitations, but does the clock start when the lawsuit is filed, or when the defendant is served? Rules: Rule 3: action is commenced with filing  lawsuit is timely. Kansas statute: action is commenced at the date of  service  lawsuit not timely Holding: This is outcome determinative so according to York, we use State Ct. Walker v Armco Steel Corp (Same)(No conflict between state & fed Rule 3) – Hanna Part I analysis Facts of case were exact replica of those raised in Ragan. (Complaint filed against ∆ within two year statute of  limitations, but service occurs after 2-year period) Holding: Rule 3, which states when a civil action is commenced, does not apply to the issue of tolling the statute of  limitations. There is no conflict btwn state and federal rules, each govern their own sphere. Ragan v Merchants Transfer

Is there a Federal Rule? Rule 3 doesn’t work b/c it states when civil action is commenced, not when statute of  limitation tolls. (This is interpreted narrowly b/c otherwise it would infringe on substantive right of D to have peace after certain time)  Then apply judge-made law (Hanna Part II) – Yes, outcome determin ative. Inequitable to use fed over state – so must use state “There is simply no reason why, in the absence of a controlling federal rule, an action based on state law would concededly be barred in the state courts by the state statute of limitations should proceed through litigation to  judgment in fed court solely bc of the fortuity that there is a diversity of citizenship btwn the litigants”

Gasperini v. Center for Humanities - SC, 1996 | The Hybrid or Compromise Approach to satisfy state & federal interests 491 Facts: Diversity suit for damages for photographer’s lost slides: jury awards $450K ($1500 per lost slide); District Court denies Rule 59 motion for amended judgment. • Federal Standard: “shocks the conscience”  more deferential ------review of “abuse of discretion” (1 shot to overrule by showing abuse) • New York Standard: “deviates materially”  stricter less deferential -----“ de-novo review” (2 shots to overrule - @ TC and AC level) Therefore, state court is highly preferable! Issue: Should state or fed law apply to the trial & appellate procedures?

Is there a federal rule on point? SC says Rule 59 does not apply (no conflict btwn state/fed rule 59). (Therefore, skip Part I of  Hanna analysis)  TC Analysis: How about Judge-Made law? 1. Outcome Determinative: Yes (award may be overruled depending on standard) 2. Forum Shopping: Yes (more likely to file in federal to avoid excessive reward being overruled) 3. Inequitable administration of the law: Yes ***Therefore, must apply state law in federal diversity case at trial level AC Analysis: 7th Amendment – higher review of “abuse of discretion” to respect jury decisions (constitutional right) Holding: Combine the two: use state law but also apply higher federal “abuse of discretion” standard of review to respect state & fed interests. Policy: Rescues Federal Rules *Approved Byrd’s emphasis on importance of federal interests as a factor in making an Erie choice

Federal Court applying state statutes and law in Diversity jurisdiction § 1332

Federal Courts apply state law by: Applying state statutes Following state court interpretation of statutes Applying state laws as

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ANNOUNCED or WOULD BE announced by the state’s highest court.

FORK: what if state’s highest court hasn’t decided on the issue?



Court with Claim State trial court, appellate court

Applying State Law • Mandatory authority= State’s highest court • May look at federal courts application as PERSUASIVE authority if state appellate or supreme court has not made a decision. State Sup Ct Stare decisis, unless it decides to overturn previous decision Federal District Court • Mandatory authority= State’s highest court • Unless, no decision by them, then may look at what appellate courts have said, or GUESS what state’s highest court would do. Federal AC • Mandatory authority= State’s highest court • Persuasive Auth = other federal courts guessing what state’s highest court would do. Supreme Ct • Mandatory authority = only itself. • Persuasive authority = state’s highest court. **if a federal court applies the law, guesses what state court would do, but a year later, state supreme court goes the other way? “Certification” – fed courts can certify an issue with state supreme ct. (state courts discretion to review issue or not) (Uniform Certification of Questions of Law Act) • increased expense, burden on state ct, threat to judicial function of fed cts in diversity (diminished sense of  responsibility) 

Can the court reopen if parties request Rule 60 (b)(6)?  TENSION: NO—finality is important, it’s not fair to have diversity judgments never be final o  YES—important not to have weird judgmen ts out there/ it’s not fair o

 Joinder Rule 20 – (optional) Can join in one action as (1) Plaintiffs and as (2) Defendants: •

multiple claims if arise out of  same transaction/occurrence or series of  trans/occur. + common question of law or fact  Claims: Jointly, severally, or in the alternative  More efficient  Consistent judgments

 Joinder is NOT required, but permitted. b/c π has right NOT to sue if they don’t want to! For SMJ and P.  Jurisdiction issues/concerns

(a): compulsory counterclaim, - juris given by supp 1367  If it occurs out of  the same transaction/occurrence – use it or lose it!  Perhaps, brings out fair issues all at once, prevents Δ from waiting, taking it somewhere else and suing π.  NOTE: SMJ and P jurisdiction in this forum is NOT an issue, b/c already has PJ over π simply by virtue of  them filing claim there. Rule 13

(b): permissive counterclaim (unrelated claim), efficiency says, settle all claims w/o separate suit. – still need SMJ

(g): cross claim against co- Δ . If occurs out of  same

transaction/occurrence (optional)

 juris given by supp 1367

Responding to counterclaim (within 20 days) – Rule 12 Williams v. Robinson (D.C. 1940) - Not same transaction Facts: Husband sued his wife & X in divorce proceeding for adultery. X brings separate suit against husband for libel based on the charges for adultery. Husband moves to dismiss for failure to state claim upon which relief can be granted Holding: Motion dismissed – to hold it as the same transaction or occurrence would admit there was an adulterous affair, and fails “same evidence test.”

Rule 18(a): a party can join all claims against another ONLY IF (one) proper claim has already been asserted. (optional) >>>> still need SMJ

Rule 14 – D brings in 3 rd Party optional 14(a): for Δ to implead new parties against whom she has claims related to main claim; “all or part”  must follow R8-11

Impleaded 3P Δ is allowed to assert defenses against both π. 14(a)(2)(A): assert defense against 3P π 14(a)(2)(C): assert defense against original π. (D): assert claim against original Π (same subj matter) (3) Π can assert against 3P Δ (if same subject matter ) 14 (a) (1) timing: sue 3P Δ within 10 days of  answering  w/o Ct Permission, but generally Cts still have discretion Make sure SMJ is met in all cases Factors Courts Consider: In favor of impleader Efficiency of hearing related claims

Denial of Impleader Undue delay in seeking Complication of main issues

Avoid repeated suits Avoid inconsistent judgments

Potential prejudice to π from impleading sympathetic 3P.

 Jurisdiction Issues:  3P doesn’t count for venue  1367 a supplemental jurisdiction  3P Δ doesn’t have to be diverse from anyone.

Essentials and Interlopers: Rules 19 and Rule 24 Rule 19(a) Must join if feasible when: Should party be joined? 19(a)(1)(A): when ct cannot accord complete relief amongst existing parties UNLESS absentee also brought in, Eg: joint owners, and π only sues 1 Eg: sue landlord who is leasing from someone else. (19a3) - waivable

Is joinder feasible? -Do they object to venue

Is the party “indispensible? - Is there PJ/Ter Juris? – waivable 19(a)(1)(B)(i): Or if proceeding w/o person impairs their ability to protect their interest. - Will it deprive ct of SMJ? – non-waivable 19(a)(1)(B)ii): Or if NOT joining exposes one of the original parties to multiple obligations Shields v. Barrow (U.S. 1855) – old school interpretation of R19. Seller (CA) sues against two (MS) of six endorsers of a bad note. Other four endorsers + buyer left out of the action bc they’re from CA & would destroy diversity. In 1855, the court threw the case out because the missing parties could not be joined. Note that R19 has changed (due to 1966 amendments) since its application in Shields. 19(a): parties should be joined because judgment in federal court as present endorsers may hold them severally liable or it might prejudice

Rule 19(b): If Person should be joined under 19(a) but cannot? 3 Options:

 TODAY: Courts Consider the factors a) Would judgment in absence prejudicial to parties joined & not? b) Extent protection can be used to avoid prejudice c) Adequate w/o party? d) π gets adequate remedy (in another ct) if dismissed?

 Yoonjee’s Joinder Chart Stage in Trial

Parties

Claims

Designing that lawsuit

20(a) multiple Π suing together 20 (b) multiple Δs to a suit Can also use rule 20 when Δ is 13 a /13b counterclaiming…or cross claim.

18(a)--With one valid claim, can bring all kinds of  claims (for efficiency)

Defensive moves after suit is filed

14 (a)-- D1 can IMPLEAD D2 who for liabilities to Δ 1… (not original P) Completely voluntary. 19a--must be joined if feasible 19b--what to do if not feasible. Is this a move by the Δ? Usually used for the 19b  purpose, the get the claim dismissed.

13(a) compulsory counter claims 13(b) permissive counter claims

Once 13 counterclaims attached, 18a, bring all your claims. 14 (a)2(A)--D2 can counterclaim against D1 (B) defend against P, (C) claim against P, (4) vice versa

Parties that want IN (within 10 days after suit is filed)

24 (a)1-- right to join if there is statute (US govt) 24 (a)2--right to join IF 3 conditions MET 24b1B -- if 24a doesn't work.

Rule 24 Intervention 24(a)(1) MUST grant intervention if there’s a statute authorizing: Eg: for govt (uS AG, trademark office, etc) OR (2) (3 conditions) (a) interest relating to the property/transaction subject of action (b) and interest may be impaired if not allowed in case AND (c) absentee’s interest not already adequately represented by parties to the action 24(b)(1)(B): MAY grant permissive intervention when Ct has ultimate control  When: Limitations: same question of law,  Timely under 24b3? (will it delay or o o prejudice?) shared interest, o Require reopening of discovery? o more efficient o Did they attempt intervention sooner? o Given conditional right by fed o statute

Rule 22 Interpleader–

Allows P’s to interplead D’s whos claims may expose P to double/multiple liability, even if claims are independent, and even if P denies liability. – Allows D’s exposed to similar liabilities to interplead through cross/counter-claims Rule interpleader -Limited by Rule 4 effective service requirements and by general venue requirements in 28 USC §1391. -Complete diversity req. (both sides of v) -Normal rules of PJ -Minimum: $75,000. Statutory interpleader Limited by 28 USC §1397 venue requirements, but it has nationwide service of process under Rule 4(k)(1)(C) Personal jurisdiction is much less restrictive than the normal requirements. Minimal diversity between any two claimants (the insurance company, a.k.a. the stakeholder, is not even considered). Minimum claim requirement is $500. Only available to diversity of citizenship claims Statutory interpleader is intended to allow people to be brought into federal court, so service of process is less limited.

Supplemental Jurisdiction §1367 Pendant jurisdiction: Federal claim + related state claim 

See united mine workers v. Gibbs, federal LMPA + state contract interference. (1) Pendant Juris = Common nucleus of operative fact  United Mine Workers v. Gibbs - SC, 1966 | 376 (2) Ct has power to reject this Facts: G loses job/benefits, sues for violation s of § 303 of the Labor Management Relations Act of 1947 (fed SMJ) + TN state common law. Issue: Whether the court properly entertained jurisdiction of the claim based on TN law. Holding/Rule: (1) SMJ when state & fed claims “arose from the same nucleus of operative fact.” (2) SMJ up to Ct’s discretion. (consider judicial economy, convenience and fairness to litigants- state issue should not be predominating claim). Aldinge Gibbs met (Constitutional) BUT no Statutory grant of juris. (OVERRULED BY §1367) r Facts: Gibbs test met but State claim inconsistent w/ apparent intent of Congress to bar Fed. Civil right claims under§1983 Rule: (overruled by supp juris) In addition to Article III power (under Gibbs), the court must also have statutory power to hear the case

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Do we have power to hear claim? “common nucleus of operative facts” test o Federal courts have power to hear state claim, but not required. Ct can sever. o Does it make sense to hear claim together? YES→ federal court | NO→ dismiss, goes to state

Factors: State law claim predominates? o Sensitive issues of state law? o Confuse jury? o Federal issues resolved early? o

Ancilliary jurisdiction : claims by Δ over other 3P  



Close connection between original and added state claim → SINGLE court case Available for: 14(a)(1): D interpleads 3pD o 13(g): crossclaim against co-party o 24(a): intervenor o Deny for 13(b) permissive counterclaims. (not same subj matter) Owen Equip v Gibbs met BUT no Statutory grant of juris (§1332 diversity conflict). (OVERRULED BY §1367) Kroger Facts: Went against diversity §1332 to allow interpleading of nondiverse 3rd party D (14a) Rule: (overruled by supp juris) In addition to Article III power (under Gibbs), the court must also have statutory power to hear the case

Finley v. US

§ 1367 Supplemental jurisdiction   

made a statute in 1990 – added “statutory grant of jurisdiction” – in response to Kroger/aldinger § 1367 (a) Very broad, same as Gibbs, BUT § 1367 (b) Limits on claims brought by P under 14, 19, 20, 24 (preserving limits from Kroger) 3 part analysis Is the constitutional power Art III § 2 to hear supplemental claim? A proper claim exists within federal court jurisdiction? (SMJ/diversity)  Related claim arises from same operative facts? Gibbs 

Statutory grant of jurisdiction over supplemental claim? [newly provided by 1367(a), limited by (b) in diversity cases P claims] Use discretionary factors to decide whether to do so. NOTE:

If there’s no supplemental juris, always ask: Is there Independent SMJ?? (diversity/$)

Ch 17 Jurisdiction vs. Joinder - checking power (rules) + jurisdiction (§1331,1332) *If there is a separate basis for SMJ (via federal law) for some parties, their citizenship is exempt in the determination of diversity for the others. What rule that authorizes? Rule 13, 14, 18, 19, 20, 22, 24 (some req. same transaction/facts or law) Is there Independent SMJ? (Diversity + Amount) Is there Supplemental Jurisdiction? S ame nu cl eus of facts? Gibbs I s i t a di ver sity case? - Kroger nod 1. Did P’S CLAIM destroy diversity? §1367b (14-3 rdpD, 19-req joinder, 20-permissive joinder, 24intervenor) 2. (OR) proposed P’s under 19 (req) or 24 (intervenor)

Rule 23 - Class Actions &

Collusive Agreements

• a1 - So numerous, joinder infeasible b1 – possibility of inconsistent judgments, pool of funds insufficient (no notice req) • a2 - Common question of law or fact b2 – D made characteristics of class a basis for own conduct (no notice req) • a3 - Typicality b3 – class action superior to individual actions (notice req for all potential Ps) • a4 – Adequacy of representations c – members can opt out of b3 --d (power of representative), e (settlement) – cant settle w/out ct approval

Derivative actions by shareholders – Rule 23.1 • When one or several shareholders sue on behalf of all the other holders to get company to do something/stop doing something • Action takes on characteristics of a class action. Actions relating to unincorporated associations – Rule 23.2 • Class action can be used against unincorporated associations by naming a few members of the association as representatives. • By naming a few members in class action, lawyers satisfy diversity easily and limit the venue and service requirements Collusive Actions Kramer v Caribbean Mills 1969 – D entered agreement to purchase stock in Panama Finance Co. Paid down, but no installments. Assigned interest to Kramer (P) for $1, who promised to pay Panama 95% recovery. Collusive Agreements cannot be used to create diversity of citizenship – §1359 Collusive Agreements Rose v Giamatti – Rose sued D (commissioner) in OH state court. D removed them to fed. Rose tried to defeat diversity by  joining 2 unincorporated assoc (major leagu e baseball & Cincinnati reds) to destroy diversity. Nominal/formal parties will be ignored – suit will stay in fed ct – uses case law to establish (NYTimes)

Service of Process Service of process  

= delivery to a party or witness court orders. = service of initial notice to Δ of filing of lawsuit

Rule 4:Service of Process Rule 4(c )(1): what docs (summons + complaint) Rule 4(a) contents of summons 4 (e) and 4(d): how papers served  4(e): serve individuals: (1) follow state law or (2) Personal delivery, leave copies at individuals’ dwelling o or usual place of abode w/ person of suitable age/discretion who resides there, deliver to agent appt by D to receive 4(c) (2): after 1980: anyone over 18 and NOT a party can deliver, usually π’s lawyer hires someone o 4(e)(1) for ppl outside of state—follow state laws where Δ is. o 4(h): serving corporations:  4(h)(1) if corporation is in US→ serving officers, manager, or general agent is OK. o 4(h)(2) if corporation is outside of the US o 4(m): must serve D within 120 days of complaint filing date  4(c )(2): who must serve  4(d) waive requirement of service (get deadline extended to 60 days from 20 days)  4(d) waiving is sort of mandatory since o 4(d)(2)B: impose cost of service to Δ if w/o good cause  4(d)(3) gives 60 days to respond if they waive. Cf to 20 days. 

Service grants personal jurisdiction when 4k1a - State court has PJ (by long-arm), then Federal (in that state) automatically does too + (own test) 14th Due  process 4k1b - Impleaded parties (R14,19) served within judicial district