BROAD QUESTION - Did Court screw up or is it Due Process violation of life, liberty and property?

Does court have power over this jurisdiction?

Subject Matter Jurisdiction
"what type of case does a particular court have the power to hear?"
e.g. divorce cases heard in divorce court
STATE COURT
can hear any case in that state (the forum state)
FEDERAL COURT
limited jurisdiction
cases heard under federal subject matter jurisdiction
diversity
those involving a federal question
e.g. Constitutional or statutory issue

PERSONAL JURISDICTION
"Power" Theory of Personal Jurisdiction (PP 680-700)
Assuming we have subject matter jurisdiction.
PERSONAL JURISDICTION - ct's power to exercise authority over D; Where relationship b/t P's
COA arises out of D's contact w/ forum state
*No relationship b/t COA and property, unlikely there will be personal jurisdiction w/in the state
a 784 This argument doesn't ignore the fact that the presence of property in a state may bear on
the existence of jurisdiction by providing contacts among the forum state, the defendant, and
the litigation.
what person can be brought before this court?
the power of a court to enter a final judgment that has the full force of the law behind it
a court's "territory"
2 Constitutional Bases
Due process clause (Amendment XIV)
validity of judgments rendered against non-residents without personal service of process
upon them and their enforcement have been resisted on the ground that proceedings in a
court to determine rights and obligations of parties over whom that court has no jurisdiction
do not constitute due process of law
Article IV (1)
Full Faith and Credit shall be given in each State to the public Acts, Records, and judicial
Proceedings of every other State. And the Congress may by general Laws prescribe the
Manner in which such Acts, Records and Proceedings shall be proved, and the Effect
thereof.
FEDERAL v. STATE
Analysis - 2-step analysis:
PERSONAL JURISDICTION IN FEDERAL COURT
FFEDERAL
Rule 4. Summons
(k) Territorial Limits of Effective Service.
(1) In General. Serving a summons or filing a waiver of service establishes personal
jurisdiction over a defendant:
(A) who is subject to the jurisdiction of a court of general jurisdiction in the state where
the district court is located;
Statutory jurisdiction - State's Long Arm Statute (Burger King)
Service of summons establishes PJ over df if:
Rule 4(k)(1)(A)

"court of general jurisdiction"

refers to subject matter jurisdiction
What case is this court allowed to hear?
"any old state court"
(B) who is a party joined under Rule 14 or 19 and is served within a judicial district of the
United States and not more than 100 miles from where the summons was issued; or
Rule 14/19 - w/in 100 miles of closet courthouse w/o submitting self to minimum
contacts standard as long as parties are joined under 14/19
"bulge" jurisdiction
within 100 miles from where summons was issued
even if across state line, but not more than 100 miles
(C) when authorized by a federal statute.
by federal statute
(2) Federal Claim Outside State-Court Jurisdiction. For a claim that arises under federal
law, serving a summons or filing a waiver of service establishes personal jurisdiction over
a defendant if:
PJ over a foreign df with contacts , but not minimum contacts, within the forum
state is established
Loophole provision
Applies to intl D - claim MUST be based on federal law
No state can exercise jurisdiction over the intl D
(A) the defendant is not subject to jurisdiction in any state's courts of general
jurisdiction; and
creates one state out of the 50 states, such that the contacts of the df in all the
states suffices for minimum contact, BUT
(B) exercising jurisdiction is consistent with the United States Constitution and
laws.
MUST be consistent with U.S. Constitution and laws
STATE
LONG ARM STATUTES
a Does long arm statute cover this situation?
TYPES
a STATUTORY - COA comes w/in forum state's long arm statute If so, then:
FL - lists circumstances where it applies - go through sections to argue applicability
(1) Specific
(2) General
a CONSTITUTIONAL - Exercise of personal jurisdiction comports w/ due process
(OK/CA)
Statute says court is authorized to exercise jurisdiction to the extent of US Constitution
-Rule 4(k)
1.
Assuming situation is covered (also argue Constitutional standing)
14th Amendment - Due Process Clause
Whether exercise of jurisdiction over party comports w/ Due Process clause?
Note: Argue Due Process violation because of improper venue
Gray v. American Radiator & Standard Sanitary Corp. (1961) P 714
FACTS
Phyllis Gray (Plaintiff) was injured when a water heater exploded. This took place in
Cook County, Illinois. Subsequently, Plaintiff brought suit in Illinois against both Titan
Valve Manufacturing Company (Titan) of Cleveland, OH. and American Radiator &
Standard Sanitary Corporation (Defendant). The suit alleged that the safety valve had
been negligently constructed for use in the water heater.
RULE OF LAW

In a products liability action, a defendant who sells products that he knows will be used
within a given forum may be required to defend an action within that forum state, if the
product sold in fact causes injuries within the state.
Gray v. American Radiator
FL Long Arm Statute
West's Florida Statutes Annotated Currentness
Title VI. Civil Practice and Procedure (Chapters 45-89) (Refs & Annos)
Chapter 48. Process and Service of Process (Refs & Annos)
48.193. Acts subjecting person to jurisdiction of courts of state
(1) Any person, whether or not a citizen or resident of this state, who personally or through an
agent does any of the acts enumerated in this subsection thereby submits himself or herself and,
if he or she is a natural person, his or her personal representative to the jurisdiction of the
courts of this state for any cause of action arising from the doing of any of the following acts:
(a) Operating, conducting, engaging in, or carrying on a business or business venture in
this state or having an office or agency in this state.
(b) Committing a tortious act within this state.
(c) Owning, using, possessing, or holding a mortgage or other lien on any real property
within this state.
(d) Contracting to insure any person, property, or risk located within this state at the
time of contracting.
(e) With respect to a proceeding for alimony, child support, or division of property in
connection with an action to dissolve a marriage or with respect to an independent action
for support of dependents, maintaining a matrimonial domicile in this state at the time of
the commencement of this action or, if the defendant resided in this state preceding the
commencement of the action, whether cohabiting during that time or not. This paragraph
does not change the residency requirement for filing an action for dissolution of
marriage.
(f) Causing injury to persons or property within this state arising out of an act or
omission by the defendant outside this state, if, at or about the time of the injury, either:
1. The defendant was engaged in solicitation or service activities within this state;
or
2. Products, materials, or things processed, serviced, or manufactured by the
defendant anywhere were used or consumed within this state in the ordinary
course of commerce, trade, or use.
(g) Breaching a contract in this state by failing to perform acts required by the contract
to be performed in this state.
(h) With respect to a proceeding for paternity, engaging in the act of sexual intercourse
within this state with respect to which a child may have been conceived.

(2) A defendant who is engaged in substantial and not isolated activity within this state, whether
such activity is wholly interstate, intrastate, or otherwise, is subject to the jurisdiction of the
courts of this state, whether or not the claim arises from that activity.
(3) Service of process upon any person who is subject to the jurisdiction of the courts of this
state as provided in this section may be made by personally serving the process upon the
defendant outside this state, as provided in s. 48.194. The service shall have the same effect as if
it had been personally served within this state.
(4) If a defendant in his or her pleadings demands affirmative relief on causes of action
unrelated to the transaction forming the basis of the plaintiff's claim, the defendant shall
thereafter in that action be subject to the jurisdiction of the court for any cause of action,
regardless of its basis, which the plaintiff may by amendment assert against the defendant.
(5) Nothing contained in this section limits or affects the right to serve any process in any other
manner now or hereinafter provided by law.

TWO-STEP ANALYSIS IN DETERMINING WHETHER LONG ARM STATUTE IS APPLICABLE

[Cf. Long arm statute handout (1/26/10)]
1. Does the defendant's action fit a part of the applicable long arm statute?
interpret meaning of terms (e.g. based on state case law) to determine if df action applies
under long arm statute (Shoe)
2. If so, is the court's exercise of personal jurisdiction over the defendant constitutional under
the due process clause of the Fourteenth Amendment?
THUS, court has specific jurisdiction over defendant, and personal jurisdiction is
constitutional under 14th Amendment
Pennoyer (df/ ant) v. Neff (PL/ ee)
FACTS
This case arises from the initial action taken by J.H. Mitchell against Neff in Oregon, for the
alleged nonpayment of legal fees. A default judgment was entered against Neff, a nonresident of
Oregon, after notice by publication. The second action is a suit by Neff (Plaintiff) to recover
possession of a tract of land, which Pennoyer (Defendant) acquired under a sheriff's deed, made
upon sale of property on execution issued upon a judgment recovered against Neff in the prior
action.
After filing the initial suit, Mitchell submitted an affidavit that stated that Neff was a resident of
the State of California. As a result of that affidavit, the Circuit Court of the United States for the
District of Oregon allowed Mitchell to serve notice to Neff by publication once a week for six weeks
in a paper of general circulation in Multnomah County, Oregon. After publication, Mitchell's
Judgment by Default was entered against Neff. As a consequence, Neff's land, which was located
in Oregon, was sold to Pennoyer at a sheriff's sale.
2 Lawsuits
1. Mitchell v. Neff
OR state court
unpaid legal fees by Neff to Mitchell
default judgment entered for Neff's failure to appear
judgment executed on the land
2. Neff v. Pennoyer
Federal court
ejectment claim by Neff after judgment in first suit
Statutory basis for allowing substituted service in this case
Code of Oregon
provides for such service (by publication) when an action is brought against a non-resident
and absent defendant, who has property within the state.

"an illegitimate assumption of power"

ct. states this is any attempt to exercise authority beyond the limits of the State
Circuit ct.
found judgment against Neff in original suit was invalid due to defects in the affidavit used to
prove service by publication
because it came from the editor of paper, and statute calls for affidavit of "printer, his
foreman, or his principal clerk"
this ct. held judgment against Neff invalid; App. Ct. found affidavit of editor sufficient
State App. Ct.
found judgment against Neff was invalid for lack of personal service of process on him
premises in controversy could not be subjected to payment of demand of resident creditor
except by proceeding in rem
by direct proceeding against the property for that purpose
SUPREME COURT
Lower ct. decision was affirmed, but for reasons given by App. ct., above
These decisions are sound under: Two principles of public law of the independent States
1) that every state possesses exclusive jurisdiction and sovereignty over persons and
property within its territory
2) that no State can exercise direct jurisdiction and authority over persons or property
outside its territory
3 methods for a court to properly exercise jurisdiction over a person before it under Pennoyer v.
Neff
1) Personal service in-state, OR
2) Attach the property at the time of filing
e.g. posting a lien
3) Voluntarily appearing
"special" or "limited" appearance
Exception to this method
when the suit involves a "thing"
in rem jurisdiction
e.g. a divorce
RULE OF LAW
The substituted service of process by publication, where actions are brought against nonresidents in connection with process against the person for commencing the action, is effectual
only where the action is in the nature of a proceeding in rem.
WAYS TO ESTABLISH JURISDICTION
SERVICE OF PROCESS
1.
JURISDICTION IN PERSONAM - makes D personally liable
"against a person"
where the object of the action is to determine the personal rights and obligations of
the defendant
constructive (substituted) service upon a non-resident is ineffectual for any purpose
most common type of jurisdiction
affects an individual up to the value of the damages
NOTE: for further explanation, Cf. P 688.
1. Personal service of process (direct) on D in the forum's state
Notice v. Jurisdiction - BOTH are needed
Can have notice but no jurisdiction and jurisdiction but no notice
1. State can req co to appoint agent to receive service of notice
p. 700 - Corp are fictional entities
1. States enacted comprehensive reqs that all corps engaging in business
w/in their borders register and appoint agents for service of process
Many statutes provide that corp which engaged in business but
did not register would be deemed impliedly to have consented to
service on a state official

1.

Doctrine of corporate presence - corp was present wherever it engaged

in a suff amt of activities and it would therefore be served like a
natural person who was present
JURISDICTION OVER CORPORATE DEFENDANTS
Old law
a corporation could be sued in the state in which it was
incorporated
New law
1) all corporations engaging in business within their borders
MUST register and appoint agents for service of process
if no agent in the forum state is named by the
corporation, the Secretary of State will serve as agent
under Pennoyer v. Neff
2) Doctrine of Corporate Presence
a corporation is present wherever it engages in a
sufficient amount of activity, and could therefore be
served like a natural person who was present
continuous and substantial commercial activity is
necessary to constitute presence

Personal Jurisdiction: Service Within the Forum (PP 799-811)

BURNHAM (df/ pet) v. SUPERIOR COURT (resp) (1990) P 799
Mrs. Burnham (CA) v. Mr. Burnham (NJ)
JUSTICES
Chief Justice and Kennedy, J. join Scalia, J. in his opinion
White, J joins in I, II-A, II-B, and II-C
FACTS
Dennis Burnham married Francie Burnham in West Virginia in 1976. In
1977, the couple moved to New Jersey, where their two children were born.
In 1987, the couple decided to separate. Mrs. Burnham (Respondent)
intended to move to California, so they agreed that she would retain custody
of the two children. Shortly before Mrs. Burnham was to move to California,
she and Mr. Burnham (Petitioner) agreed that she would file for divorce on
the grounds of "irreconcilable differences."
After the Petitioner and his wife agreed to divorce, Mr. Burnham filed a
Petition for Divorce in New Jersey based on grounds of "desertion."
However, Petitioner did not obtain the issuance of a summons nor did he
attempt to serve her with process. Mrs. Burnham was not successful in
convincing Mr. Burnham to heed their prior agreement. Therefore, in 1988,
Mrs. Burnham filed suit for divorce in California. In January, 1988,
Petitioner visited San Francisco, California as part of a business trip and to
visit his children. While in San Francisco, Petitioner was served with a copy
of Mrs. Burnham's divorce petition. Petitioner sought relief in the California
state courts, asserting that the Due Process Clause of the Fourteenth
Amendment prohibited California courts from obtaining jurisdiction over
him because he lacked "minimum contacts" with the state. His only contacts
with the state were a few short visits to conduct business and to visit his
children. The Superior Court denied his Motion to Quash, and the Court of
Appeals of California denied his Petition for Writ of Mandamus. The court
held that physical presence in the state when service is obtained is sufficient
personal jurisdiction.
Mr. Burnham contacts within CA
visited his children
business
his wife and children were there

this was her doing, however

ISSUE
Whether the Due Process Clause of the Fourteenth Amendment prevents
jurisdiction of a state over a nonresident, who was served with process while
temporarily present in that state, for an action, which is totally unrelated to
his activities in that state (i.e. transient jurisdiction)?
II-A
assertion of PJ is consistent with Due Process if PJ does not violate
"traditional notions of fair play and substantial justice." Int'l Shoe
whether Due Process requires similar connection between litigation and df
contacts with the State when df is physically present in the State at the time he
is served
B
it remains the practice of all the States and the federal govt. that in-state
personal service on an individual is sufficient to confer personal jurisdiction,
if one disregards the few erroneous opinions since 1978 that render the
practice unconstitutional. (what a douche!)
C
df contends that his presence in the forum is no longer sufficient to establish
personal jurisdiction
Scalia states that jurisdiction based on physical presence alone constitutes
due process because it defines the standard of "traditional notions of fair
play and substantial justice."
since it is traditional, it is due process
D
df strongest argument relies on Shaffer
that a State lacks jurisdiction over an individual unless the litigation
arises out of his activities in the State
BUT, Shaffer, like Shoe, involved jurisdiction over an absent
defendant
Shoe confined its minimum contacts requirements to defendants that
were not present within the territory of the forum
nothing in Shaffer expands the requirement
III
contemporary notions of due process applicable to PJ are the "traditional
notions of fair play and substantial justice."
concurrence (Brennan) proposes standard of contemporary justice requires
more:
measures state court jurisdiction not only against traditional doctrines
in this country, including current state court practice, but against each
Justice's subjective assessment of what is fair and just
subjectivity and inadequacy of this approach becomes apparent when
concurrence tries to explain why assertion of jurisdiction in present
case meets its standard of continuing-American-tradition-plus-innatefairness
it is traditional because it is due process
nothing the ct. says today can prevent individual States from limiting or
abandoning the in-state basis of jurisdiction
BUT, States have declined to adopt such limitation
HOLDING
App. Ct. judgment affirmed
RULE OF LAW
Jurisdiction can be exercised over an individual through his presence in the
forum state. This is true even if the individual is a non-resident of the forum
state, who came to the forum state only briefly. Personal jurisdiction within

the forum may be obtained as long as service was made upon the individual
while he was within the forum state.
MAYBE, according to Hata (Cf. infra)
CONCURRENCE
(Brennan, J.) II
by visiting the forum State, transient df avails himself of significant
benefits provided by the state
without transient jurisdiction, an asymmetry would arise:
a transient would have the full benefit of the power of the forum
State's courts as a PL while retaining immunity from their authority
as a df
IN ENGLISH:
Transient jurisdiction MAY or MAY NOT be found constitutional, because a
slight majority in this case found it to be constitutional.
NOTE: Transient jurisdiction applies to individuals only, not corporations

1.

Burnham v. Superior Court - Family law dispute - married in NJ. W moved to Ca

w/ custody. W files in CA for irreconciliable differences. As long as she meets
residency in CA, can file for dissolution. For any $ order, needs to have CA assert
jurisdiction over H. W waits for H to come to CA on business and be served with
process.
State courts tend to want to exercise jurisdiction over non-resident
SCALIA - this is the way we've always allowed jurisdiction => OK
BRENNAN - All assertions must be subject to min contacts std - CA jur over
H was OK but elaborate justification
Enjoying police protection, etc.
RULE - Service of process in the forum state is gen always constitutional
Keeps door open for unusual situation, it might be unfair and unreas to
subject D to min contacts std
JURISDICTION IN REM - focuses on property - service by publication - AT THE TIME
LAWSUIT IS FILED
"against a thing"
where the object of the action is to reach and dispose of property in the State, by
enforcing a contract or a lien respecting the same, to partition it among different
owners, or, when the public is a party, to appropriate it for public purpose
substituted service by publication is sufficient to inform the party of the object of
proceedings
affects an individual only to the extent of of the value of his property
Attaches D's prop in state (putting something on title)
EVERY state has an attachment statute i.e. adding lien as security
a. Quasi in rem
i.
Type 1 - actions in the nature of rem (more common)
(action in the nature of rem)
against only known individuals with an interest in the property
a direct relationship between the PL claim and the property
e.g. a suit for ejectment
Prop is the subject of suit, direct connection
a Smith v. Jones - suit is about prop at issue
a Ex Bank sues Owners for foreclosure (action pertaining to ppl's
interests in prop)
i.
Type 2 - attachment jurisdiction
(quasi in rem)
no relationship between the PL claim and the property
PL has a statutory reason for claim as to why the property can
be attached
e.g. breach of K claim by Mitchell in original suit in Pennoyer

Attachment jurisdiction (Pennoyer) - overturned by Shaffer

1.
Mitchell v. Neff - didn't attach at beginning
a.
Prop had nothing to do with suit which was for unpaid
atty fees
DOCTRINE OF FRAUDULENT INDUCEMENT (INTO THE
FORUM)
invalidates service where PL has lured df into the jurisdiction with
falsehoods
limits ability of PL to invoke the power of a distant state through
subterfuge
Harris (df/ debtor) v. Balk (PL/ creditor)
Lawsuit 1
Epstein, resident of MD, had a claim of over $300 against
Balk (NC)
writ of garnishment issued by MD ct. at request of
Epstein also garnished a $180 debt that Harris (NC) owed
Balk
Harris paid Epstein $180 in MD
Lawsuit 2
upon returning to NC, Balk sued Harris for $180 debt
Balk argued MD court had no jurisdiction over Harris
NC lower ct.
ordered Harris to pay Balk $180
NC Supreme Ct.
held NC had to enforce MD judgment; MD
judgment was valid
Which method did the court use to exercise
jurisdiction?
2) attaching property at the time of the filing
in this case, the money was attached
"situs of the debt"
obligation of the debtor to pay his debt accompanies him
wherever he goes
RULE OF LAW
It is the duty of the garnishee to give notice to his own
creditor, so that the creditor may have the opportunity to
defend himself against the claim of the person suing out
the attachment
Harris v. Balk
1

Pure in rem (rare) - ct purporting to settle

an action on a piece of property "as against the entire world"
e.g. the govt. seeks to condemn an office building
thus extinguishing everyone's title in the property (as against the entire
world)
i.
Action to quiet title, govt condemning prop, proceedings to close an
estate
1.
US v. $13,460 (rem-thing) in US currency
a. Trying to claim no one has further interest in the prop but
the US
NOTE: for further explanation of true in rem, quasi in rem: Type I (in the nature of
rem), and quasi in rem: Type II (quasi in rem), Cf. P 689.
i

VOLUNARY APPEARANCE BY DEFENDANT

1
Special appearance voluntary appearance, state doesn't assuming jurisdiction
a. Special appearance to contest jurisdiction, NOT on merits of case

a.

Direct attack

Hess v. Pawloski
PL (MA) sued df (PA) in Massachusetts for personal injuries sustained in auto accident in MA.
Jurisdiction in this case
based on MA statute providing that acceptance by a non-resident of the "privilege" of operating
motor vehicle in that state "shall be deemed equivalent to an appointment by such nonresident... upon whom may be served all lawful processes in any action proceeding against him,
growing out of any accident in which said non-resident may be involved while operating a
motor vehicle in MA."
BUT, notice sent outside the state to a non-resident is unavailing to give jurisdiction in an action
against him personally for money recovery. Pennoyer v. Neff
in advance of the operation of a motor vehicle on its highways by a non-resident, the State
may require the non-resident to appoint one of its officials as his agent on whom process
may be served
RULE OF LAW
The use of the highway by a non-resident is the equivalent of the appointment of the registrar as
agent on whom process may be served. The difference between the formal and implied
appointment is not substantial, so far as concerns the application of the due process clause of
the 14th Amendment.
Hess v. Pawloski
PENNOYER PRINCIPLES - only points that are GOOD LAW, overturned by Shaffer v. Heitner
i
Judgment that is void when entered is void forever
i
If one ct enters judgment against D w/o proper personal jurisdiction and winner tries to
enforce elsewhere, other state doesn't have to enforce
1
Normally ALL states MUST give full faith and credit unless forum state lacked
jurisdiction
1
CAVEAT - Direct v. Collateral Attack
a. COLLATERAL ATTACK - argument against jurisdiction after 1st
judgment was entered
HYPO - Neff defaults, goes into 2nd case to enforce in CA, waived when he
didn't bring it up in the 1st trial, can only raise personal jurisdiction
i
DIRECT ATTACK - argument against juridiction made on lawsuit
1
i.e. 12(b)(2) mtn
i
If court enters judgment w/o personal jurisdiction, it is a Due Process violation
HYPO
P v. D, personal injury
Dism'd for lack of personal jurisdiction
P v. D, personal injury, diff state
Dismissal for lack of jur - not on merits
Can only make collateral attack if D defaulted
Directed atttack w/ direct appeal
Whether exercise of jurisdiction over party comports to Due Process?
CASE LAW - TWO PART QUESTION
NATURE AND EXTENT OF CONTACTS W/ FORUM STATE
1.
"MINIMUM CONTACTS STANDARD"
1.
PURPOSE of minimum contacts std (Fair and Reasonable Factors):
a.
Inconvenience/ burden to D
a.
Sovereignty
a.
P's interest in convenience and effective relief
a.
Forum state's interest in adjudicating dispute
a.
Interstate judicial system - effective resolution of controversy
2 suits in 2 diff places - not efficient => OK

1
1

Substantial social policies

MINIMUM CONTACT STANDARD

RELATIONSHIP b/t P's COA and D's CONTACTS w/in D's FORUM STATE
Defines difference b/t Specific and General Jurisdiction
McGee - GA example => one contact is sufficient
INTERNATIONAL SHOE CO. (df/ app) v. STATE OF WASHINGTON (PL/ resp) (1945) P. 700
FACTS
df corporation registered in MO with 15 salesmen in WA
df failed to pay taxes for Unemployment Compensation Fund in WA
Service of Process by PL
sent notice to df office in MO, AND
personally served notice to one of the salesmen in WA as an agent of the
corporation
df argued
salesman was NOT an agent of the corporation within the state of WA
its activities within the state of WA did not constitute sufficient "presence" in the
forum state
THUS, court would have no jurisdiction over df
violation of Fourteenth Amendment due process clause
THUS, federal issue = U.S. Supreme Ct.
MINIMUM CONTACTS RULE OF LAW (P. 703)
Due 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 maintenance of the suit does not offend
"traditional notions of fair play and substantial justice." (Stone, J.)
PURPOSEFUL AVAILMENT REQUIREMENT OF MINIMUM CONTACTS
RULE
defendant's exercise of privilege of conducting activities in the forum state,
and enjoying the benefits and protections of its laws, gives rise to obligations
that arise out of activities within the state
703 - SC => Def of presence - Presence in the state in this sense has never been doubted
when the activities of the corp there have not only been continuous and systematic, but
also give rise to the liabilities sued on, even though no consent to be sued or authorization
to an agent to accept service of process has been given
Taxes based on employees within state
Liability - failure to pay taxes
703 - Minimum contacts std - Now that that the capias ad respondendum (service by
sheriff who took D to ct to ensure appearance) has given way to personal service of
summons or other form of notice, due process requires only that in order to subj D to a
judgment in personam, if he be not present w/in territory of 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."

McGee v. Int'l Life Ins. Co. (1957) P 707

In the context of personal jurisdiction, today many commercial transactions touch two or more states and
may involve parties separated by the full continent. With this increasing nationalization of commerce has
come a great increase in the amount of business conducted by mail across state lines. At the same time
modern transportation and communication have made it much less burdensome for a party sued to
defend himself in a state where he engages in economic activity.

SPECIFIC JURISDICTION (1-2 applies to every case)

When there is a strong relationship b/t P's COA and D's contact w/in forum state
Traditional Formulation - presence w/in the State
1

PURPOSEFUL AVAILMENT v. Unilateral Activity

a. PURPOSEFUL AVAILAMENT - D purposefully availed itself to forum state's
jurisdiction through purposeful contacts
Enjoying the benefits and protections of the forum state's law
i.e. doing business in the state
WORLD-WIDE VOLKSWAGEN CORP. (pet.) V. WOODSON (resp.) (1980) P 720
[C.O.A. = PRODUCTS LIABILITY]
FACTS
Harry and Kay Robinson (Respondents) brought an action in Oklahoma
against the World-Wide Volkswagen Corporation (World-Wide) and Seaway
under a product liability theory. The Respondents purchased a new Audi
from Seaway Volkswagen in Massena, New York, in 1976. They moved from
New York, where they had resided at the time of purchasing their
automobile, to Arizona. As they traveled through Oklahoma, another vehicle
struck the Respondents' car in the rear, causing a fire, which severely
burned Kay Robinson and her two children.
World-Wide VW and Seaway were added as defendants by Audi and VW to
destroy diversity with the Robinsons
World-Wide is incorporated in New York and has its principal office
there. Seaway is a retail distributor for World-Wide, which is
incorporated in New York, and has its principal office there.
ISSUE
Whether the Due Process Clause of the Fourteenth Amendment is violated
when an Oklahoma court exercises in personam jurisdiction over a

nonresident automobile retailer and its wholesale distributor in a products

liability action, when the Defendant's only connection with Oklahoma is the
fact that an automobile sold in New York to New York residents became
involved in an accident in Oklahoma?
PROCEDURE
District Court
The Respondents subsequently brought a product liability action in
the District Court for Creek County, Oklahoma against Audi,
Volkswagen, and petitioners World-Wide Volkswagen( regional
distributor) and Seaway (retail dealer).
Robinsons v. Audi + Volkswagen + World-Wide VW + Seaway
World-Wide and Seaway entered special appearances in district ct. to
challenge the court's jurisdiction over them
Petitioners were denied m/ reconsideration by District Judge Woodson
(resp.)
Supreme Court of Oklahoma
Petitioners (World-Wide VW and Seaway) then sought a writ of
prohibition in the Supreme Ct. of Oklahoma to restrain Woodson
from exercising in personam jurisdiction over them
because World-Wide had no minimum contacts with the State of OK, the
actions of the district judge were in violation of their rights under the
Due Process Clause
Supreme Ct. of OK denied writ, holding pers. jurisdiction over
petitioners was authorized under OK "long-arm" statute
Court's rationale
product being sold and distributed by petitioners is so mobile that
petitioners can foresee its possible use in OK
Supreme Court of the U.S. (White, J.)
reverses appellate ct. decision; grants certiorari to consider due process
issue
NOT reviewing OK Supr. Ct's application of Oklahoma's own long
arm statute, but determining if it can exercise personal jurisdiction
over defendants constitutionally under the due process clause (?)
minimum contacts standard under the Fourteenth Amendment (due
process)
burden is on the defendant to show that maintenance of the suit
offends traditional notions of fair play and justice
burden is considered in light of (as applied to W-WVW):
1. forum state's interest in adjudicating the dispute
(McGee)
OK court interested in adjudicating dispute because of
severe tragedy
2. plaintiff's interest in obtaining convenient and effective
relief (Kulko)
due to their injuries, plaintiffs can obtain most convenient
relief in OK
3. interstate judicial system's interest in obtaining
efficient resolution
more efficient to try one case in OK, as opposed to 2
separate cases in OK and NY
4. substantial social policy
manufacturers may make safer products at the fear of
products liability actions
SO, based on factors considered in establishing defendant's
burden, court should be able to easily establish personal
jurisdiction over defendant.

Why not?
sovereignty of the state
THUS, the due process clause "does not contemplate that a state
may make binding a judgment in personam against an
individual or corporate defendant with which the state has no
contacts, ties, or relations." Shoe
petitioners' foreseeability of the use of their product in Oklahoma
There is no evidence that World-Wide or Seaway does any business in
Oklahoma.
"foreseeability" alone has never been a sufficient benchmark for
personal jurisdiction under the due process clause
it is not the mere likelihood that a product will find it's way into
the forum State, but that the defendant's conduct and
connection with the forum state are such that he should
reasonably anticipate being haled into court there
Audi and VW did not object to jurisdiction
"Stream of Commerce" Theory
Court does not exceed its jurisdiction under the Due
Process Clause of the 14th Amendment if the corporation
delivers its products into the stream of commerce with the
expectation that they will be purchased by consumers in the
forum state
Dissents
Justice Marshall: Certain industries, such as the automotive
industry, do not lend themselves to being structures as to avoid suit in
foreign jurisdictions.
Justice Brennan: The majority accepts the fact that states may
exercise jurisdiction over a distributor that indirectly delivers its
products into the stream of commerce knowing that the goods will be
used in the forum state. Justice Brennan does not understand how the
majority differentiates
e.g. of Rule 4(k)(1)(A) as applied to this case
if this case is brought in federal district court in Oklahoma, the court would
look to the OK long-arm statute to determine its jurisdiction based on a court of
general jurisdiction in Oklahoma
World-Wide VW v. Woodson
World Wide Volkswagen the rest of the story.doc
GENERAL JURISDICTION
exists where claim is unrelated to defendant's contacts within the forum
permits all claims, of whatever origin, to be asserted against the defendant
SPECIFIC JURISDICTION
exists where the claim arises out of or is related to the defendant's contacts within the
forum
the defendant's ability to foresee being haled into court in the forum (Cf.
foreseeability above)
1

UNILATERAL ACTIVITY - activity by P caused COA, not D (opposite of purposeful

availment)
a.
Hansen v. Denckla - unilateral activity
i.e. food poisoning from bad burger from GA then drove to FL, cannot
sue Burger King in FL because no jurisdiction due to P's unilateral
activity

FORESEEABILITY - Foreseeable that D will be subject to suit in that forum state's ct in the
event of suit
a.
STREAM OF COMMERCE (Product liability)

a.

WWV - Ct => no contacts on OK; D didn't foresee suit in LK

ASAHI METAL INDUSTRY CO. (df/ ant) v. SUPERIOR COURT (PL/
ee) (1987) P 756 [C.O.A.= PRODUCTS LIABILITY]
Zurcher v. Cheng Shin v. Asahi
(CA) (Taiwan/tires) (Japan/valves)
FACTS
In 1978, Gary Zurcher, a resident of the State of California, was
injured when the rear tire of his Honda motorcycle exploded
while he was driving on the freeway in California.
Zurcher filed suit in California state court against Cheng Shin
Rubber Company, a Taiwanese company that manufactured the
tube used in the tire. Consequently, Cheng Shin filed a crosscomplaint against Asahi Metal Industry Company, a Japanese
company that supplied tube valve assemblies to Cheng Shin.
Cheng Shin submitted an affidavit of its purchasing manager,
which asserted that Asahi was aware that its valve assemblies
would, ultimately, be used in products that were sold in
California.
Asahi filed writ of prohibition, and motion to quash (equivalent
to 12(b)(2) m/ dismiss for lack of PJ) to challenge CA jurisdiction
affidavits of Asahi president, stating he never contemplated
being haled into ct in CA, attached to motion
ISSUE
Whether knowledge by a defendant of the fact that a product
manufactured by it will be eventually sold in a forum state
might not be enough to satisfy minimum contacts analysis?
RULE OF LAW
Normally, if a non-resident defendant manufactures a product
that it knows will be eventually sold in the forum state, this fact
alone will be enough to satisfy minimum contacts under
International Shoe. However, if this is the only contact that
exists, it might be unreasonable to make the defendant
manufacturer defend in the forum state. To hold otherwise
would violate the Fourteenth Amendment's due process
guarantees.
Superior Ct. of CA
applies "stream of commerce" theory from W-WVW in
interpreting the Due Process Clause
court's exercise of PJ based on no more than the df act of
placing the product in the stream of commerce
U.S. Supreme Court
STEP 1: PURPOSEFUL MINIMUM CONTACTS WITHIN
FORUM STATE
(O'Connor, J)
different interpretation of W-WVW "stream of
commerce" language
requires the action of the df to be more purposefully
directed at the forum state than merely placing
product in stream of commerce
df awareness that stream of commerce may or may
not sweep product into forum state does not convert
the mere act of placing the product into the stream
into an act purposefully directed toward the forum
state
THUS, exercise of PJ over Asahi by Superior Ct. of CA
exceeds limits of Due Process

(Plurality Opinion)
Supreme Ct. of CA application of "stream of commerce"
theory from W-WVW
court's exercise of PJ based on no more than the df
act of placing the product in the stream of commerce
THUS, exercise of PJ over Asahi by Superior Ct. of CA
DOES NOT exceed limits of Due Process
STEP 2: REASONABLENESS AND FAIRNESS
Depends on:
1. burden on the defendant
burden in this case is "severe" for having to defend
in a foreign legal system
2. forum state's interest in adjudicating the dispute
(McGee)
interests of the forum in CA assertion of jurisdiction
are slight
3. plaintiff's interest in obtaining convenient and effective
relief (Kulko)
interests of the PL in CA assertion of jurisdiction are
slight
4. interstate judicial system's interest in obtaining
efficient resolution
re: claim for indemnification asserted by Cheng
Shin (tire-maker who bought Asahi tube valves)
against Asahi
"Cheng-Shin has not demonstrated that it is more
convenient to litigate its claim in California rather
than Taiwan or Japan"
since Asahi is not a CA resident, CA's legitimate
interests in dispute have diminished
5. substantial social policy
federal interest in its foreign relations policies will
best be served by an inquiry into the reasonableness
of the assertion of jurisdiction, and an unwillingness
to find the serious burdens on an alien defendant
outweighed by minimal interests on the part of the
PL or forum state
Justices concurring in part
agreed with STEP 2
THUS, step 2 is majority opinion
disagreed with O'Connor's interpretation of "stream of
commerce" theory in STEP 1, creating a plurality opinion
wanted to apply Superior Ct. of CA interpretation
O'Connor's opinion in step 1 is not binding due to
plurality opinion
justices could not come to a majority decision in
interpreting stream of commerce theory to est.
purposeful minimum contacts
O'Connor - plurality => req more than putting it in stream of
commerce
Mere awareness is NOT enough (II.A) - MUST having
something additional - marketing, advertisements
Speaking for 4 justices + herself - speaking for
PLURALITY, NOT majority
ONLY has persuasive effect

Brennan plurality => not binding - 21st Cent - easy to put in

stream of commerce; enough for purposeful availment
1
Stevens dissent - consider dangerousness of product, qty of
product in forum state
EFFECTS TEST (Torts) - ONLY on int torts - Effect on victim - focal point
of harm
Tortious conduct aimed at someone w/in forum state with substantial effects
to constitute a contact
1
Whether D did something in state that affects forum state
LIBEL
1
Cf. Keeton v. Hustler P 738
regular monthly sales of thousands of magazines cannot. . . be
characterized as isolated, random, or fortuitous
1
Calder (df/ pet.) v. Jones (PL/ resp.) (1984) P 736 [C.O.A. = LIBEL]
FACTS
Shirley Jones sued the Nat'l Enquirer (a FL corporation) for
libel in CA state court
newspaper did not raise objection to jurisdiction
Jones also sued Calder (editor) and South (story reporter)
both were FL residents and objected to jurisdiction
Jones v. National Enquirer + Calder + South
Nat'l Enquirer did not object to jurisdiction
Supreme Court
DEFENDANT'S CONTACTS
upheld jurisdiction under minimum contacts rule required
to meet due process clause of Fourteenth Amendment
"The Effects" Test
CA is the focal point both of the story and of the harm
suffered. Jurisdiction over petitioners is therefore proper in
CA based on the "effects" of their FL conduct in CA.
the effects created the contacts
limited to intentional torts
brunt of harm suffered based on petitioners'
intentional, and allegedly tortious, actions expressly
aimed at CA
petitioners must have reasonably foreseen
being haled into court in CA
SPECIFIC JURISDICTION (Cf. above)
the effects of an alleged intentional tort are to be
assessed as part of the analysis of the defendant's
relevant contacts within the forum
Fl wrote article in Fl but knew it affected Ca resident the most
in CA
PROPERTY As Contact - Prop itself MUST have contact w/in state
a
Shaffer v. Heitner - If D owns prop in forum state, it's not enough for
jurisdiction
Overruled Pennoyer
PRESENCE OF DEFENDANT'S PROPERTY IN THE FORUM AS A
"CONTACT"
SHAFFER (df/ ant) v, HEITNER (PL/ ee) (1977) P 781 [C.O.A. =
stockholder's derivative action]
Heitner (AZ) v. Greyhound (DE) + officers and directors (AZ)
Greyhound did not challenge jurisdiction, since suit
brought in DE
FACTS

Heitner (Appellee), a nonresident of Delaware, was the

owner of one share of stock in the Greyhound Corp., a
business incorporation under the laws of Delaware, with
its principal place of business in Phoenix, Arizona. On
May 22, 1974, Appellee filed a shareholder's derivative
suit in the Court of Chancery for New Castle County,
Delaware, and named as defendants both Greyhound and
twenty-eight present or former directors of either
Greyhound Corp. or Greyhound Lines, Inc.(Greyhound),
the subsidiary corporation.
Appellee alleged that the individual defendants had
violated their duty to Greyhound by causing it and its
subsidiary to engage in actions that resulted in the
corporations being held liable for substantial damages in
a private antitrust suit and for a large fine in a criminal
contempt action. All of the activities in these suits took
place in Oregon. Simultaneously with his complaint,
Appellee filed a Motion for an Order of Sequestration of
the Delaware property of the individual defendants,
pursuant to Delaware state statute. The sequestration
order was signed the day it was filed and, as a result,
caused approximately 82,000 shares of Greyhound
common stock to be seized. The court held that the stock
was located in Delaware, so it was subject to seizure in
Delaware. The twenty-one defendants affected by the
seizure, filed a Motion to Quash Service of Process and to
Vacate the Sequestration Order. They contended that the
seizure was a violation of due process, there were not
sufficient minimum contacts to sustain Delaware's
jurisdiction under International Shoe, and the stocks
were not capable of being seized in Delaware. The Court
of Chancery denied these motions. The Supreme Court of
Delaware affirmed this judgment.
ISSUE
Whether a statute that allows a court of that state to take
quasi in rem jurisdiction of a lawsuit by sequestering any
property of the defendants that happens to be located
within that forum state is constitutional
statutory DE situs of the stocks provided a sufficient basis
for the exercise of quasi in rem jurisdiction by a DE court
Quasi in rem: Type II (quasi in rem)
no relationship between the PL claim and the
property
PL has a statutory reason for claim as to why
the property can be attached
traditionally based on attachment of
property present in jurisdiction, not on
contacts between defendant and the State
Adverse judgment in rem directly affects the
property owner by divesting him of his rights
in the property before the court.
"minimum contacts" standard from Shoe
would not affect many types of actions
brought in rem
"For the type of quasi in rem action typified
by Harris v. Balk and the present case,

however, accepting the proposed analysis

would result in significant change. These
cases where the property now serves as the
basis for the state court jurisdiction is
completely unrelated to the plaintiff's cause
of action. Thus, although the presence of the
defendant's property in a State might suggest
the existence of other ties among the
defendant, the State, and the litigation, the
presence of the property alone would not
support the State's jurisdiction." (Marshall,
J.)
Whether the standard of fairness and substantial justice
set forth in International Shoe should be held to govern
actions in rem as well as in personam.
Property cannot be subjected to a court's judgment unless
reasonable and appropriate efforts have been made to give
the property owners actual notice of the action.
the primary rationale for attaching property to
adjudicate claims over which the State would have no
jurisdiction is that a wrongdoer "should not be able to
avoid payment of his obligations by the expedient of
removing his assets to a place where he is not subject to
an in personam suit." Restatement 66.
HOWEVER, attachment in a federal court is not
enough to exercise jurisdiction
must look to the State's attachment laws to
determine if jurisdiction is proper
"[W]hen the claims to the property itself are
the source of the underlying controversy
between the plaintiff and the defendant, it
would be unusual for the State where the
property is located not to have
jurisdiction."(Marshall, J.)
HOLDING
All assertions of state-court jurisdiction must be
evaluated according to the standards of traditional
notions of fair play and justice set forth in International
Shoe and its progeny.
State of DE substantial interest in supervising mgmt of a DE
corporation
Heitner argues DE courts must have jurisdiction over
corporate fiduciaries to protect this interest
this argument undercut by DE legislature asserting its
interest based on df presence of property in the State, NOT
on df status as corporate fiduciary
RULE OF LAW
Quasi in rem jurisdiction over a defendant cannot be
exercised unless that defendant had such minimum
contacts with the forum state that in personum
jurisdiction could be exercised over him.
CONCLUSION (Marshall, J.)
It is appropriate for DE law to govern the obligations of
appellants to Greyhound and its stockholders

BUT, it does not demonstrate that appellants have

"purposefully availed themselves of the privilege of
conducting activities within the forum state."
Appellants have had nothing to do with the state of DE, and
had no reason to expect to be haled into court there
judgment of DE Supreme Ct. is reversed.
CONCURRING
Powell, J.
ct. can avoid the uncertainty of the Int'l Shoe standard
without significant costs to traditional notions of fair play
and substantial justice by applying quasi in rem
jurisdiction over real property only
Stevens, J.
concerned about the reach of fair notice to df in future
actions
Brennan, J.
Concurring in part
agrees with ct's application of minimum-contacts
standard from Int'l Shoe
Dissenting in part
"as a general rule, a State forum has jurisdiction to
adjudicate a shareholder derivative action
centering on the conduct and policies of the
directors and officers of a corporation chartered by
that State."
IN ENGLISH:
If the defendant's minimum contacts have been
established by the standard set in International Shoe, then
quasi in rem: Type II jurisdiction may be established
ONLY under the forum State's statutes regarding
attachment of property.

Enough to seize during pending case, but not enough to make a

decision
Rel b/t COA and property
1
It's ok as long as property is attached at beginning of case and is
quasi in rem
1
Minimum contacts w/ quasi in rem
Kulko - notecase
RULE - if allow personal jurisdiction, will negatively affect
parents from entering into amicable agrmt
CONTRACT As Contact
a
BURGER KING CORP. (PL/ ant) (FL) v. RUDZEWICZ (df/ ee) (MI)
(1985) P 743 [C.O.A.= BREACH OF K/ trademark infringement]
FACTS/ PROCEDURE
When Defendant failed to timely provide the royalty payments
per the franchise agreement, Plaintiff brought a diversity action
in Florida. Plaintiff served the Defendant in Michigan under the
Florida Long-Arm Statute. Plaintiff alleged that Defendant had
breached their franchise obligations, requesting damages and
injunctive relief. Defendant claimed that since he was a
Michigan resident, and Plaintiff's claim did not arise in Florida,
the district court lacked personal jurisdiction over him.
However, the district court held that it did have personal
jurisdiction over Defendant, pursuant to its long arm statute,
which extends to any person, whether or not a resident of the

state, who breaches a contract in the state by failing to perform

required acts pursuant to the contract. The district court
entered judgment for the Plaintiff. The United States Court of
Appeals for the Eleventh Circuit reversed, holding that
jurisdiction in Florida would violate fundamental fairness
under the due process clause.
State of FL long-arm statute
extends jurisdiction to any person person who breaches a
contract in this state by failing to perform acts required by the
K to be performed in this state, so long as the cause of action
arises from the alleged contractual breach
ISSUE
Whether this exercise of long-arm jurisdiction offended
traditional conceptions of fair play and substantial justice
e=mbodied in the Due Process Clause of the Fourteenth
Amendment.
District ct.
denied df 12(b)(2) m/ dismiss for lack of personal jurisdiction
after 3-day bench trial, entered judgment for BK for $228,875,
and ordered df to cease operation of restaurant
df settled trademark infringement aspects
found BK made no misrepresentations, that df was experienced
businessman, and that at no time did df act under economic
duress or disadvantage imposed by BK
STANDARDS
Due Process Clause gives a degree of predictability to the legal
system that allows potential defendants to structure their
primary conduct with some assurance as to where the conduct
will and will not render them liable to suit (W-WVW)
this fair warning requirement is satisfied if the defendant
has purposefully directed his activities at residents of the
forum (Keeton v. Hustler)
foreseeability
it is not the mere likelihood that a product will find it's
way into the forum State, but that the defendant's
conduct and connection with the forum state are such
that he should reasonably anticipate being haled into
court there (W-WVW)
purposeful availment
so long as a commercial actor's efforts are purposefully
directed towards the residents of another State, ct rejects
notion that absence of physical contacts can defeat
personal jurisdiction there
11th Circuit ct.
held for df
Supreme Court (Brennan, J.)
DEFENDANT'S CONTACTS
payments to FL headquarters of BK
MacShara (df partner) trained at BKU in Miami
20 year contract with FL corporation for $1, 000, 000; FL
law applies
negotiations with FL corporation
equipment purchased in FL
District ct's conclusion that the assertion of personal jurisdiction
over df in FL for his alleged breach of K did not offend due
process

JUSTICE BRENNAN'S 2 STEP ANALYSIS FOR

ESTABLISHING PJ OVER DEFENDANT
1) Purposeful minimum contacts within the forum state
prior negotiations and contemplated future
consequences
df deliberately reached out beyond MI and
negotiated with a FL corporation for
purchase of a long-term franchise and the
benefits that would derive from affiliation
with nationwide organization
quality and nature of his relationship to PL
cannot be viewed as random, fortuitous, or
attenuated
df caused foreseeable injury to PL
THUS, it was presumptively reasonable for
df to be called into court in FL
terms of the K and parties actual course of dealing
df learned during negotiations that MI office
was powerless to resolve disputes and could
only channel their communications to Miami
df and PL carried on continuous course of
direct communication
franchise agreement
"choice of law designation does not require
that all suits concerning this agreement be
filed in FL"
choice of law analysis, which focuses
on all elements of a transaction, and
not simply on df conduct, is distinct
from minimum contacts jurisdictional
analysis, which focuses on df
purposeful connection to forum
2) Reasonableness and Fairness
1. forum state's interest in adjudicating the dispute
(McGee)
2. plaintiff's interest in obtaining convenient and
effective relief (Kulko)
3. interstate judicial system's interest in obtaining
efficient resolution
4. substantial social policy
On the other hand, where a df who purposefully
directed his activities at forum residents seeks to
defeat jurisdiction, he must present a compelling
case that the presence of some other considerations
would render jurisdiction unreasonable.
through means short of finding jurisdiction
unconstitutional
HOLDING
Plaintiff can maintain an action against the Defendant
within Florida. Although no true physical ties to the
Florida exist, the dispute grew directly out of a contract
that had a substantial connection with the state.
DISSENT (Stevens, J. and White, J.)
There is unfairness in any decision that forces a
franchisee to defend an action in the forum state chosen
by its franchisor. Furthermore, the only business that was

contracted by the Defendant in Florida involved

submission of royalty payments.
What is the significance of this case when we have a breach of K
in a PJ case?
The defendant's "contact" with the forum state was
entering into the contract with the plaintiff/ resident of
the forum state.
NOTE: falls under specific jurisdiction (Cf. jurisdiction
quadrant chart supra)
Will I always be subject to PJ in the state of the person with whom
I have a K?
where a df who purposefully directed his activities at
forum residents seeks to defeat jurisdiction, he must
present a compelling case that the presence of some other
considerations would render jurisdiction unreasonable.
e.g. inability to travel for health reasons
in such case, prior negotiations and contemplated future
consequences, along with the terms of the K and the
parties' actual course of dealing must be evaluated to
determine whether the defendant purposefully
established minimum contacts within the forum

K in forum state not enough to get specific jurisdiction

Look at terms, length, negotiations, anticipated performance to
establish jur
INTERNET As Contact - depends on the situation
SLIDING SCALE ANALYSIS
PJ on the Internet/ Property in the Forum as a Contact/ Choice of Law(PP
766-799)
PJ ON THE INTERNET
Pavlovich (df/ pet.) v. Superior Court (PL/ resp) (2002) P 766 [C.O.A =
misappropriation of trade secrets]
FACTS
df posted DVD decryption ("DeCSS") on his website, enabling
public to circumvent PL technology ("CSS") contained on the
DVDs. PL, a CA corporation, sues df in CA state ct. df lives and
works in TX, and has no contacts with CA (other than the effect
of his cyber-actions). df moved to quash service of process based
on lack of personal jurisdiction in CA. Court of Appeal found
CA had jurisdiction, and df appeals.
DVD CCA contends Calder "effects test" is sufficient to confer
jurisdiction
Trial ct.
DVD Copy Control Ass'n, Inc. (real party in interest) + Superior
Court of Santa Clara County v. Pavlovich
PL complaint sought injunctive relief
df filed m/ quash service of process, contending CA lacked
jurisdiction
PL contended jurisdiction was proper
because df "misappropriated trade secrets knowing such
actions would adversely impact an array of substantial
CA business enterprises"
citing Calder v. Jones, ct. denies motion
Supreme Ct. of CA
trial court's exercise of jurisdiction over df was improper

merely asserting that a df knew or should have known that his

intentional acts would cause harm in the forum state is not
enough to establish jurisdiction. . . PL must show that df expressly
aimed its tortious conduct at the forum
citing Calder v. Jones
SLIDING SCALE ANALYSIS FOR SCOPE OF PJ BASED
SOLELY ON INTERNET USE
1. situations where a df clearly does business over the internet
PJ is proper
2. interactive websites where a user can exchange information
with the host computer
exercise of jurisdiction determined by examining level of
interactivity and commercial nature of exchange of
information that occurs on the website
3. situations where a df has simply posted info on a website which
is accessible to users in foreign jurisdictions
PJ is improper
a passive website that makes information available
to those interested in it is not grounds for exercise
of PJ
THUS, Pavlovich's alleged conduct was not an act
purposefully directed toward the forum state
ISSUE
Whether df knowledge that his tortious conduct may harm
certain industries centered in California (motion picture,
computer, and consumer electronics industries) is sufficient to
establish express aiming at California
HOLDING
This knowledge, by itself, cannot establish purposeful availment
under the effects test.
RULE OF LAW
In order for a state to exercise specific jurisdiction over a
foreign defendant, it must show that the defendant has
minimum contacts related to the claim such that fair play is not
offended.
APPLYING THE EFFECTS TEST
1. because nothing suggests that Pavlovich encouraged website
visitors to use DeCSS to illegally pirate copyrighted motion
pictures, his mere awareness that they might do so does not
show purposeful availment
2. Pavlovich's tortious conduct had a foreseeable effect in CA,
but mere foreseeability is not enough for jurisdiction
otherwise, the commission of any intentional tort affecting
industries in CA would subject a df to jurisdiction in CA
THUS: defendant's knowledge of industry-wide effects in the
forum state, in conjunction with other evidence of express aiming
at the forum state establishes personal availment under the
effects test.
NARROWING THE INTERPRETATION OF THE EFFECTS TEST
ct. will not exercise jurisdiction over a df because he should
have known that his conduct may harm, not a CA plaintiff, but
industries associated with that plaintiff
such a broad interpretation would effectively eliminate the
purposeful availment requirement in the intentional tort context

HOWEVER, such tortious conduct is undoubtedly relevant to

any determination of PJ
THUS, this knowledge, alone, is insufficient to establish express
aiming at the forum state as required by the effects test
DISSENT
df intentional act was "expressly aimed" at California
GENERAL JURISDICTION (PP 811-819)
D's contacts are continuous and systematic but there's no relationship b/t COA P is suing on
and those contacts
No strong relationship b/t P's COA and D's contacts w/in forum state
Continuous and Systematic Test
Compare and contrast # of contacts
HELICOPTEROS NACIONALES DE COLOMBIA, S.A. (df/ pet) v. HALL (PL/ resp) (1984) P 811
ONLY SC case that is relatively modern that addresses gen jur
Hall (family of decedents) v. Consorcio/WSH (employer) + Bell (manufacturer) + Helicopteros
Nacionales de Colombia (pilot)
$1,000,000 jury trial
FACTS
Petitioner, a Colombian corporation, entered into a K to provide helicopter transportation for
Consorcio/WSH, the alter ego of a joint venture that had its headquarters in Houston, Tex.,
during the Consorcio's construction of a pipeline in Peru for a Peruvian state-owned oil
company. Petitioner has no place of business in Texas and never has been licensed to do business
there. Its only contacts with the State consisted of sending its CEO to Houston to negotiate the
K with Consorcio, accepting into its New York bank account checks drawn by Consorcio on a
Texas bank, purchasing helicopters, equipment, and training services from a Texas
manufacturer, and sending personnel to that manufacturer's facilities for training. After a
helicopter owned by petitioner crashed in Peru, resulting in the death of respondents'
decedents--United States citizens who were employed by Consorcio--respondents instituted
wrongful-death actions in a Texas state court against Consorcio/WSH, Bell Helicopter Co. (the
Texas manufacturer), and petitioner.
Helicopteros Nacionales contacts within forum State (TX)
president met with Consorcio in Houston re: K for helicopter service
purchased helicopter that crashed from Bell
pilot that crashed helicopter trained in TX
payment to Helicopteros Nacionales made from TX bank
GENERAL JURISDICTION
exists where claim is unrelated to defendant's contacts within the forum
permits all claims, of whatever origin, to be asserted against the defendant
may be used when contacts are continuous and systematic
SPECIFIC JURISDICTION
exists where the claim arises out of or is related to the defendant's contacts within the forum
the defendant's ability to foresee being haled into court in the forum (Cf. foreseeability above)
NOTE: General jurisdiction is a backup if specific jurisdiction is denied first.
IN ENGLISH (DIPSHIT MOVE IN THIS CASE):
Plaintiff conceded specific jurisdiction, and brought claim under general jurisdiction.
usually, a plaintiff makes complaint under both
THUS, Helicopteros Nacionales' contacts within the forum state were NOT continuous and
systematic, to satisfy general jurisdiction

FAIRNESS AND REASONABLENESS FACTORS (Worldwide) - speaking for 8 Justices incl O'Connor
Applies to:
1
SPECIFIC
1
GENERAL

NOTE: 5 Standards for Reasonableness and Fairness in est. Minimum Contacts from W-WVW, Asahi
apply to both general and specific juris.
REASONABLENESS AND FAIRNESS FACTORS
Depends on:
1. burden on the defendant
2. forum state's interest in adjudicating the dispute (McGee)
McGee - hints that ct says if P can't sue in home state, P won't sue at all
3. plaintiff's interest in obtaining convenient and effective relief (Kulko)
If P resides in state, state ALWAYS has interest in its citizens OR Asahi
4. interstate judicial system's interest in obtaining efficient resolution
5. substantial social policy
P's COA - if court doesn't allow, how might it impact social policy
DISTINGUISHING - Relationship b/t D's contacts w/ forum and P's COA
No relationship => General
Relationship => Specific
Contacts are continuous and systematic
Perkins - ct did uphold gen jur over company in OH
Co incorporated in OH, availing themselves to jur
Rosenberg
Keeton - both gen/pers jur - cont/systematic activity
If you do conclude that D's activity is continuous and systematic enough and find no relationship,
MUST use same factors for reasonableness test as for specific jurisdiction
LITIGATING JURISDICTION/ CONSENT TO SUIT IN A FORUM, (PP 819-825)
Rule 12. Defenses and Objections: When and How Presented; Motion for Judgment on the Pleadings;
Consolidating Motions; Waiving Defenses; Pretrial Hearing
(g) Joining Motions.
(1) Right to Join. A motion under this rule may be joined with any other motion allowed by this
rule.
(2) Limitation on Further Motions. Except as provided in Rule 12(h)(2) or (3), a party that
makes a motion under this rule must not make another motion under this rule raising a defense
or objection that was available to the party but omitted from its earlier motion.
(h) Waiving and Preserving Certain Defenses.
(1) When Some Are Waived. A party waives any defense listed in Rule 12(b)(2)-(5) by:
(A) omitting it from a motion in the circumstances described in Rule 12(g)(2); or
(B) failing to either:
(i) make it by motion under this rule; or
(ii) include it in a responsive pleading or in an amendment allowed by Rule 15(a)(1) as a
matter of course.
Rule 37. Failure to Make Disclosures or to Cooperate in Discovery; Sanctions
(b) Failure to Comply with a Court Order.
(2) Sanctions in the District Where the Action Is Pending.
(A) For Not Obeying a Discovery Order. If a party or a party's officer, director, or
managing agent--or a witness designated under Rule 30(b)(6) or 31(a)(4)--fails to obey an
order to provide or permit discovery, including an order under Rule 26(f), 35, or 37(a),
the court where the action is pending may issue further just orders. They may include the
following:
(i) directing that the matters embraced in the order or other designated facts be taken as
established for purposes of the action, as the prevailing party claims;
(ii) prohibiting the disobedient party from supporting or opposing designated claims or
defenses, or from introducing designated matters in evidence;

(iii) striking pleadings in whole or in part;

(iv) staying further proceedings until the order is obeyed;
(v) dismissing the action or proceeding in whole or in part;
(vi) rendering a default judgment against the disobedient party; or
(vii) treating as contempt of court the failure to obey any order except an order to submit
to a physical or mental examination.
WAYS TO CHALLENGE JURISDICTION
1
Motion to dismiss for lack of personal jur (12b2)
1
Filed answer w/ mtn to dismiss
1
Default - Rule 55
CONSENT TO SUIT IN A FORUM
WAYS TO CONSENT TO SUIT IN A FORUM
1
D appears in ct to defend and fails to challenge jurisdiction (Voluntary Appearance)
1
Consent
1. Waiver
2. Forum Selection Clauses in Contracts
parties entered into K w/ cl - if any dispute arises, agrmt that states place of excl
jursidiction
Like saying #1 - but more directly
Normally enforceable
Supreme Court consistently upholds forum selection clauses to establish
jurisdiction
trumps otherwise valid jurisdiction
Cf. Carnival Cruise Lines, Inc. v. Shute P 825
The Shutes purchased passage on a 7 day cruise with petitioners ship. Shutes paid
the fare to the agent, who forwarded payment to Petitioners HQ in Miami.
Petitioner then prepared tickets and sent them to Shutes in the State of WA. Each
ticket contained an admonition subject to conditions on contract on last pages.
On those pages under the terms and conditions of passage acceptance of the ticket
was acceptance to FL as the State where all suits would be brought to the exclusion
of all other States.
3. Consent to service of process in the State (through an agent)
D assigns agrmt that appoints someone to receive process - Szuhkent p. 823
D - farmers entered into equipment lease w/ P, provided that said farmers
appointed agent to receive service of process in NY
Pennoyer - can appt someone for service of proces
4. By the use of State procedures
leaving yourself open to countersuit
Consent by use of court procedures - Adam v. Saenger p. 824
1
Filing complaint is subjecting self to state's jurisdiction
5. "Opt-out" clause in class actions
1
Not often - unnamed P in class action
a
Rule 23(b)(3) - damages action
a
Cf. Phillips Petroleum Co. v. Shutts
class members may sit back and allow litigation to run its course, knowing that
there are safeguards provided for their protection
By not opting out of action, consenting to jurisdiction
1
Rule 23(b)(1-2) doesn't have opt-out opportunity - open question at Supreme
level
Federal ct - whether you get ability for oral argument is on the ct
FL => presumption - Judge decides mtn on briefs and specifically ask for oral
agrmt
Oral arg at TC level
Diff from Appellate Ct - MORE formal

6. Discovery Sanctions
Cf. Insurance Corporation of Ireland, Ltd. (df/ pet) v. Compagnie des Bauxites de
Guinee (PL/ resp) P 819
defendant/ insurance company moved for summary judgment in its answer to
plaintiff's complaint
THUS, defendant availed itself subject to forum State court's jurisdiction
CBG (PA) v. Ins. Corp of Ireland
Bought business interruption ins from Irish Co
Downside - can't defend on the merits
CBG would've had to take Ireland for ct to use
CBG => MSJ based on lack of personal jurisdiction
How to determine jurisdiction => jurisdictional discovery
If responding to motion to dismiss, MUST undergo
jurisdictional discovery
What did CBG ask for? ALL business interruption ins policies in PA
Not McGee v. Intl Life OR trying to show general jurisdiction
Sanctions include finding of particular fact in violation of discovery rules
ICI - trying to decide whether judge has jurisdiction over ICI to order
participating in discovery
SC => waived right by default
Committed by filing mtn => concede to jurisdiction
Finding personal jurisdiction can be found through discovery sanctions
JURISDICTIONAL REVIEW (aka Finding Personal Jurisdiction)
I. "Easy" ways
II. Minimum Contacts
A. Statutory authority of a particular court
1. Federal court
Rule 4(k)(1)(A)
whatever long-arm statute of the court in which I sit applies, that is the one I will use
2. State court
the forum State's long-arm statute
B. Constitutional authority - 14th Amendment Due Process Clause (Shoe)
SPECIFIC JURISDICTION
1. contacts with the forum state
a. relationship between defendant's contacts with the forum State and plaintiff's
cause of action
if none exists = general jurisdiction
Cf. Helicopteros Nacionales
b. purposeful availment in creating those contacts vs. unilateral activity of
someone other than
c. reasonable foreseeability that someone would be haled into court under this
COA
d. Stream of Commerce theory
Effects test/ intentional torts
Cf. Jones
Property as a contact
Cf. Schaffer; Harris
Contract alone is NOT enough
must analyze the terms of the K
Cf. Burger King; McGee
2. Reasonableness and Fairness (W-WVW)
a. burden on to litigate in the forum state (Asahi)
b. forum state's interest in litigating the dispute (McGee)
c. interest in obtaining convenient and effective relief (W-WVW)

d. interstate judicial system's interest in obtaining an efficient resolution

e. shared interests of the States in substantive social policies (Kulko)
GENERAL JURISDICTION
1. continuous and systematic contacts with the forum state
2. Reasonableness and Fairness (W-WVW)
a. burden on to litigate in the forum state (Asahi)
b. forum state's interest in litigating the dispute (McGee)
c. interest in obtaining convenient and effective relief (W-WVW)
d. interstate judicial system's interest in obtaining an efficient resolution
e. shared interests of the States in substantive social policies (Kulko)
NOTE: Analyze specific jurisdiction first. If it cannot be established, then analyze general
jurisdiction.

VENUE
NOTICE
Constitutional - Notice and Opportunity to be heard
Rule 4 - Due Process - life, liberty, and property
MAIN CASE
Mullane (ant) v. Central Hanover Bank and Trust Co. (ee) P 825
FACTS
In March, 1947, Appellee filed a petition for the settlement of its first accounting, thus
foreclosing any beneficiary from bringing an action for negligent management of the trust fund
for the period covered by the settlement. In compliance with state law, Appellee published
notice of the action on four occasions, listing the name and address of the trust company, the
name and date of creation of the common trust fund, and a list of all included funds. The names
of the beneficiaries were not included in the advertisements. Further, Appellee did not attempt
any other method of personal service upon the beneficiaries, either resident or non-resident.
Counsel for the beneficiaries (Appellant) made an appearance to object to the lack of personal
jurisdiction. The United States Court of Appeals of New York overruled the objections that the
statutory notice contravenes the requirements of the Fourteenth Amendment.
only notice given to Mullane by bank re: decree extinguishing rights of beneficiaries to sue the
bank was by publication in newspaper
under the Due Process Clause, Mullane would lose property
ct. held this did not satisfy Due Process
RULE OF LAW
In addition to the Fourteenth Amendment's requirement prohibiting jurisdiction over any
defendant who lacks minimum contacts with the forum state, due process also requires that a
reasonable method be used to notify the defendant of a pending lawsuit so that he may have an
opportunity to appear and be heard. Due process requires that the notice be reasonably
calculated to apprise interested parties of the pendency of the action and afford them an
opportunity to present their objections.
Due Process does NOT require or guarantee that notice be received.
Alternative means of service if personal service impracticable
Fundamental rule
notice must be of such nature as reasonably to convey the required information, and it must
afford a reasonable time for those interested to make their appearance
1) in some instances, notice may be reinforced by steps likely to attract the parties' attention to
proceeding
2) notice reasonably certain to reach most of those interested in objecting is likely to safeguard
interests of all, since any objection sustained would inure to the benefit of all
Notice met statutory guidelines but NOT Due Process
Bank - trustee, administers trust - normally gave first-class mail submissions of income
Yearly pitch as good trustee - notice by publication under statute

Mullane - appointed to represent beneficiaries; successfully argued that it didn't meet notice req
under Due Process
1
If Bank allowed court approval => Bank gets fee as trustees
1
Final judgment would prevent beneficiaries from brining case in the future
SC => reasonableness, sliding scale standard
Due Process p.826 - Notice and Opportunity to be heard
Mullane - could've mailed to beneficiaries
Reasonableness on type of notice given
If there is statutory means, discusses publication => Constitutional question
Rule 4 => constitutional basis
Broken down by type of D you're trying to service
Particular subdivisions under type
Statutory - each state has its own process of giving notice, constructed to satisfy jurisdiction under
Constitutional standard
Constitutional - notice and opportunity to be heard
Personal service - not req'd in every suit i.e. mail notice
D doesn't have to receive notice - focus on P's actions
w/ some circumstances - publication ok
Rule 4. Summons
(a) Contents; Amendments.
(1) Contents. A summons must:
(A) name the court and the parties;
(B) be directed to the defendant;
(C) state the name and address of the plaintiff's attorney or--if unrepresented--of the plaintiff;
(D) state the time within which the defendant must appear and defend;
(E) notify the defendant that a failure to appear and defend will result in a default judgment
against the defendant for the relief demanded in the complaint;
(F) be signed by the clerk; and
(G) bear the court's seal.
(2) Amendments. The court may permit a summons to be amended.
(b) Issuance. On or after filing the complaint, the plaintiff may present a summons to the clerk
for signature and seal. If the summons is properly completed, the clerk must sign, seal, and
issue it to the plaintiff for service on the defendant. A summons--or a copy of a summons that is
addressed to multiple defendants--must be issued for each defendant to be served.
(c) Service.
(1) In General. A summons must be served with a copy of the complaint. The plaintiff is
responsible for having the summons and complaint served within the time allowed by Rule 4(m)
and must furnish the necessary copies to the person who makes service.
(2) By Whom. Any person who is at least 18 years old and not a party may serve a summons and
complaint.
(3) By a Marshal or Someone Specially Appointed. At the plaintiff's request, the court may order
that service be made by a United States marshal or deputy marshal or by a person specially
appointed by the court. The court must so order if the plaintiff is authorized to proceed in
forma pauperis under 28 U.S.C. 1915 or as a seaman under 28 U.S.C. 1916.
(d) Waiving Service.
(1) Requesting a Waiver. An individual, corporation, or association that is subject to service
under Rule 4(e), (f), or (h) has a duty to avoid unnecessary expenses of serving the summons.
The plaintiff may notify such a defendant that an action has been commenced and request that
the defendant waive service of a summons. The notice and request must:
(A) be in writing and be addressed:
(i) to the individual defendant; or

(ii) for a defendant subject to service under Rule 4(h), to an officer, a managing or general
agent, or any other agent authorized by appointment or by law to receive service of process;
(B) name the court where the complaint was filed;
(C) be accompanied by a copy of the complaint, two copies of a waiver form, and a prepaid
means for returning the form;
(D) inform the defendant, using text prescribed in Form 5, of the consequences of waiving and
not waiving service;
(E) state the date when the request is sent;
(F) give the defendant a reasonable time of at least 30 days after the request was sent--or at least
60 days if sent to the defendant outside any judicial district of the United States--to return the
waiver; and
(G) be sent by first-class mail or other reliable means.
(2) Failure to Waive. If a defendant located within the United States fails, without good cause, to
sign and return a waiver requested by a plaintiff located within the United States, the court
must impose on the defendant:
(A) the expenses later incurred in making service; and
(B) the reasonable expenses, including attorney's fees, of any motion required to collect those
service expenses.
(3) Time to Answer After a Waiver. A defendant who, before being served with process, timely
returns a waiver need not serve an answer to the complaint until 60 days after the request was
sent--or until 90 days after it was sent to the defendant outside any judicial district of the United
States.
(4) Results of Filing a Waiver. When the plaintiff files a waiver, proof of service is not required
and these rules apply as if a summons and complaint had been served at the time of filing the
waiver.
(5) Jurisdiction and Venue Not Waived. Waiving service of a summons does not waive any
objection to personal jurisdiction or to venue.
(e) Serving an Individual Within a Judicial District of the United States. Unless federal law
provides otherwise, an individual--other than a minor, an incompetent person, or a person
whose waiver has been filed--may be served in a judicial district of the United States by:
(1) following state law for serving a summons in an action brought in courts of general
jurisdiction in the state where the district court is located or where service is made; or
(2) doing any of the following:
(A) delivering a copy of the summons and of the complaint to the individual personally;
(B) leaving a copy of each at the individual's dwelling or usual place of abode with someone of
suitable age and discretion who resides there; or
(C) delivering a copy of each to an agent authorized by appointment or by law to receive service
of process.
(f) Serving an Individual in a Foreign Country. Unless federal law provides otherwise, an
individual--other than a minor, an incompetent person, or a person whose waiver has been
filed--may be served at a place not within any judicial district of the United States:
(1) by any internationally agreed means of service that is reasonably calculated to give notice,
such as those authorized by the Hague Convention on the Service Abroad of Judicial and
Extrajudicial Documents;
(2) if there is no internationally agreed means, or if an international agreement allows but does
not specify other means, by a method that is reasonably calculated to give notice:
(A) as prescribed by the foreign country's law for service in that country in an action in its
courts of general jurisdiction;
(B) as the foreign authority directs in response to a letter rogatory or letter of request; or
(C) unless prohibited by the foreign country's law, by:
(i) delivering a copy of the summons and of the complaint to the individual personally; or
(ii) using any form of mail that the clerk addresses and sends to the individual and that requires
a signed receipt; or
(3) by other means not prohibited by international agreement, as the court orders.

(g) Serving a Minor or an Incompetent Person. A minor or an incompetent person in a judicial

district of the United States must be served by following state law for serving a summons or like
process on such a defendant in an action brought in the courts of general jurisdiction of the
state where service is made. A minor or an incompetent person who is not within any judicial
district of the United States must be served in the manner prescribed by Rule 4(f)(2)(A), (f)(2)
(B), or (f)(3).
(h) Serving a Corporation, Partnership, or Association. Unless federal law provides otherwise or
the defendant's waiver has been filed, a domestic or foreign corporation, or a partnership or
other unincorporated association that is subject to suit under a common name, must be served:
(1) in a judicial district of the United States:
(A) in the manner prescribed by Rule 4(e)(1) for serving an individual; or
(B) by delivering a copy of the summons and of the complaint to an officer, a managing or
general agent, or any other agent authorized by appointment or by law to receive service of
process and--if the agent is one authorized by statute and the statute so requires--by also
mailing a copy of each to the defendant; or
(2) at a place not within any judicial district of the United States, in any manner prescribed by
Rule 4(f) for serving an individual, except personal delivery under (f)(2)(C)(i).
(i) Serving the United States and Its Agencies, Corporations, Officers, or Employees.
(1) United States. To serve the United States, a party must:
(A)(i) deliver a copy of the summons and of the complaint to the United States attorney for the
district where the action is brought--or to an assistant United States attorney or clerical
employee whom the United States attorney designates in a writing filed with the court clerk--or
(ii) send a copy of each by registered or certified mail to the civil-process clerk at the United
States attorney's office;
(B) send a copy of each by registered or certified mail to the Attorney General of the United
States at Washington, D.C.; and
(C) if the action challenges an order of a nonparty agency or officer of the United States, send a
copy of each by registered or certified mail to the agency or officer.
(2) Agency; Corporation; Officer or Employee Sued in an Official Capacity. To serve a United
States agency or corporation, or a United States officer or employee sued only in an official
capacity, a party must serve the United States and also send a copy of the summons and of the
complaint by registered or certified mail to the agency, corporation, officer, or employee.
(3) Officer or Employee Sued Individually. To serve a United States officer or employee sued in
an individual capacity for an act or omission occurring in connection with duties performed on
the United States' behalf (whether or not the officer or employee is also sued in an official
capacity), a party must serve the United States and also serve the officer or employee under
Rule 4(e), (f), or (g).
(4) Extending Time. The court must allow a party a reasonable time to cure its failure to:
(A) serve a person required to be served under Rule 4(i)(2), if the party has served either the
United States attorney or the Attorney General of the United States; or
(B) serve the United States under Rule 4(i)(3), if the party has served the United States officer
or employee.
(j) Serving a Foreign, State, or Local Government.
(1) Foreign State. A foreign state or its political subdivision, agency, or instrumentality must be
served in accordance with 28 U.S.C. 1608.
(2) State or Local Government. A state, a municipal corporation, or any other state-created
governmental organization that is subject to suit must be served by:
(A) delivering a copy of the summons and of the complaint to its chief executive officer; or
(B) serving a copy of each in the manner prescribed by that state's law for serving a summons
or like process on such a defendant.
(k) Territorial Limits of Effective Service.

(1) In General. Serving a summons or filing a waiver of service establishes personal jurisdiction
over a defendant:
(A) who is subject to the jurisdiction of a court of general jurisdiction in the state where the
district court is located;
(B) who is a party joined under Rule 14 or 19 and is served within a judicial district of the
United States and not more than 100 miles from where the summons was issued; or
(C) when authorized by a federal statute.
(2) Federal Claim Outside State-Court Jurisdiction. For a claim that arises under federal law,
serving a summons or filing a waiver of service establishes personal jurisdiction over a
defendant if:
(A) the defendant is not subject to jurisdiction in any state's courts of general jurisdiction; and
(B) exercising jurisdiction is consistent with the United States Constitution and laws.
(l) Proving Service.
(1) Affidavit Required. Unless service is waived, proof of service must be made to the court.
Except for service by a United States marshal or deputy marshal, proof must be by the server's
affidavit.
(2) Service Outside the United States. Service not within any judicial district of the United States
must be proved as follows:
(A) if made under Rule 4(f)(1), as provided in the applicable treaty or convention; or
(B) if made under Rule 4(f)(2) or (f)(3), by a receipt signed by the addressee, or by other
evidence satisfying the court that the summons and complaint were delivered to the addressee.
(3) Validity of Service; Amending Proof. Failure to prove service does not affect the validity of
service. The court may permit proof of service to be amended.
(m) Time Limit for Service. If a defendant is not served within 120 days after the complaint is
filed, the court--on motion or on its own after notice to the plaintiff--must dismiss the action
without prejudice against that defendant or order that service be made within a specified time.
But if the plaintiff shows good cause for the failure, the court must extend the time for service
for an appropriate period. This subdivision (m) does not apply to service in a foreign country
under Rule 4(f) or 4(j)(1).
(n) Asserting Jurisdiction over Property or Assets.
(1) Federal Law. The court may assert jurisdiction over property if authorized by a federal
statute. Notice to claimants of the property must be given as provided in the statute or by
serving a summons under this rule.
(2) State Law. On a showing that personal jurisdiction over a defendant cannot be obtained in
the district where the action is brought by reasonable efforts to serve a summons under this
rule, the court may assert jurisdiction over the defendant's assets found in the district.
Jurisdiction is acquired by seizing the assets under the circumstances and in the manner
provided by state law in that district.
MANNER OF SERVING PROCESS
an exercise of the court's power through summons, which directs df to file or answer
Cf. FRCP 4/ p 829 in CB
VENUE
place of trial
Completely guided by statute
Federal Court
in which judicial district do I file?
28 U.S.C. 1391. Venue generally
(a) A civil action wherein jurisdiction is founded only on diversity of citizenship may,
except as otherwise provided by law, be brought only in:
(1) a judicial district where any defendant resides, if all defendants reside in the
same State,

(2) a judicial district in which a substantial part of the events or omissions giving
rise to the claim occurred, or a substantial part of property that is the subject of
the action is situated, or
(3) a judicial district in which any defendant is subject to personal jurisdiction at
the time the action is commenced, if there is no district in which the action may
otherwise be brought.
Only basis for DIVERSITY
(b) A civil action wherein jurisdiction is not founded solely on diversity of citizenship may,
except as otherwise provided by law, be brought only in:
(1) a judicial district where any defendant resides, if all defendants reside in the
same State,
(2) a judicial district in which a substantial part of the events or omissions giving
rise to the claim occurred, or a substantial part of property that is the subject of
the action is situated, or
(3) a judicial district in which any defendant may be found, if there is no district in
which the action may otherwise be brought.
Other bases for subject matter
One or the other to be met
Never use (a)(3) or (b)(3) unless there is no other basis for jurisdiction
(c) For purposes of venue under this chapter, a defendant that is a corporation shall be
deemed to reside in any judicial district in which it is subject to personal jurisdiction at
the time the action is commenced. In a State which has more than one judicial district
and in which a defendant that is a corporation is subject to personal jurisdiction at the
time an action is commenced, such corporation shall be deemed to reside in any district in
that State within which its contacts would be sufficient to subject it to personal
jurisdiction if that district were a separate State, and, if there is no such district, the
corporation shall be deemed to reside in the district within which it has the most
significant contacts.
NOT a definition of where a corporation resides
1391(a)(1), (b)(1) - tells you that venue is proper in any judicial district where any
D resides
Residing for corp defined under 3191(c)
(d) An alien may be sued in any district.
State Court
in which county do I file?
use the applicable state statute
Motion to dismiss for improper venue - 12(b)(3)
motion MUST be made during pre-answer motion/ answer or it is LOST (use it or lose it)
Bates (PL/ant) v. C & S Adjusters, Inc. (df/ee) (1992) P 831
FACTS
Phillip E. Bates (Plaintiff) commenced this action in the District Court for the Western
District of New York following receipt of a collection notice from C & S Adjusters,
Incorporated (Defendant). Plaintiff alleged a violation of the Fair Debit Collection
Practices Act. Plaintiff had incurred the debt in question while he was a resident of the
Western District of Pennsylvania. The creditor also had its principal place of business in
that district. The creditor referred the matter to Defendant, a local agency, which
transacted no business in New York. After Defendant mailed a collection notice to
Plaintiff in Pennsylvania, the postal service forwarded the notice to Plaintiff at a new
address in New York. Defendant filed a Motion to Dismiss for Improper Venue, which
was granted by the District Court for the Western District of New York.
Injury (of Due Process violation) happens when notice was rec'd
Former version of 28 USC 1391
Amendment (1990) - substantial part of events
There can be MORE THAN ONE district that applies
Substantial part - improper notice in NY

Personal Jurisdiction and Proper Venue but Court can still transfer case to
different court or dismiss
Venue was proper under 28 US.C. 1391(b)(2)
(b) A civil action wherein jurisdiction is not founded solely on diversity of citizenship may,
except as otherwise provided by law, be brought only in; (2) a judicial district in which a
substantial part of the events or omissions giving rise to the claim occurred, or a substantial
part of property that is the subject of the action is situated
federal question
allows an action to be brought in a judicial district in which a substantial part of events
or omissions giving rise to claim occurred
RULE OF LAW
The statutory standard for venue focuses not on whether a defendant (creditor) has made
a deliberate contact with the venue, but on the location where the events occurred.
HOLDING
Venue was proper under 28 U.S.C.A. 1391(b)(2) because a substantial part of the events
giving rise to Plaintiff's claim occurred in the Western District of New York. Here, the
collection notice is located in New York. Therefore, venue in New York is proper. The
United States Court of Appeals for the Second Circuit reversed and remanded the case.

Where P filed suit

Where D wants suit

Rule/ Law governing

1 State ct

Another state ct or foreign

ct

Forum non conveniens - no mechanism available hwereby state ct can tra

only dismiss it

1 Fed ct

Another fed ct

1404(a), 1406(a), 1631, 1407

1 Fed ct

Foreign ct

Forum non conveniens - dis'd

If there is a foreign court that is more convenient, 12(b)(6) for forum non
conveniens
Final judgment is NOT on the merits

1 State ct

Fed ct

Removal

TRANSFER - CANNOT transfer for forum non conveniens

Can ONLY transfer to another federal court
CANNOT transfer to state court or foreign nation
Only remedy is case to be dismissed and refiled into other court as a NEW CASE
VENUE STATUTES
FEDERAL COURT TO FEDERAL COURT
1
1404. Change of venue
(a) For the convenience of parties and witnesses, in the interest of justice, a district court may
transfer any civil action to any other district or division where it might have been brought.
1

1406. Cure or waiver of defects

(a) The district court of a district in which is filed a case laying venue in the wrong division or
district shall dismiss, or if it be in the interest of justice, transfer such case to any district or
division in which it could have been brought.

1631. Transfer to cure want of jurisdiction

Whenever a civil action is filed in a court as defined in section 610 of this title or an appeal,
including a petition for review of administrative action, is noticed for or filed with such a court
and that court finds that there is a want of jurisdiction, the court shall, if it is in the interest of
justice, transfer such action or appeal to any other such court in which the action or appeal

could have been brought at the time it was filed or noticed, and the action or appeal shall
proceed as if it had been filed in or noticed for the court to which it is transferred on the date
upon which it was actually filed in or noticed for the court from which it is transferred.
1

1407. Multidistrict litigation

(a) When civil actions involving one or more common questions of fact are pending in different
districts, such actions may be transferred to any district for coordinated or consolidated pretrial
proceedings. Such transfers shall be made by the judicial panel on multidistrict litigation
authorized by this section upon its determination that transfers for such proceedings will be for
the convenience of parties and witnesses and will promote the just and efficient conduct of such
actions. Each action so transferred shall be remanded by the panel at or before the conclusion
of such pretrial proceedings to the district from which it was transferred unless it shall have
been previously terminated: Provided, however, That the panel may separate any claim, crossclaim, counter-claim, or third-party claim and remand any of such claims before the remainder
of the action is remanded.
(b) Such coordinated or consolidated pretrial proceedings shall be conducted by a judge or
judges to whom such actions are assigned by the judicial panel on multidistrict litigation. For
this purpose, upon request of the panel, a circuit judge or a district judge may be designated
and assigned temporarily for service in the transferee district by the Chief Justice of the United
States or the chief judge of the circuit, as may be required, in accordance with the provisions of
chapter 13 of this title. With the consent of the transferee district court, such actions may be
assigned by the panel to a judge or judges of such district. The judge or judges to whom such
actions are assigned, the members of the judicial panel on multidistrict litigation, and other
circuit and district judges designated when needed by the panel may exercise the powers of a
district judge in any district for the purpose of conducting pretrial depositions in such
coordinated or consolidated pretrial proceedings.
(c) Proceedings for the transfer of an action under this section may be initiated by-(i) the judicial panel on multidistrict litigation upon its own initiative, or
(ii) motion filed with the panel by a party in any action in which transfer for coordinated
or consolidated pretrial proceedings under this section may be appropriate. A copy of
such motion shall be filed in the district court in which the moving party's action is
pending.
The panel shall give notice to the parties in all actions in which transfers for coordinated
or consolidated pretrial proceedings are contemplated, and such notice shall specify the
time and place of any hearing to determine whether such transfer shall be made. Orders
of the panel to set a hearing and other orders of the panel issued prior to the order either
directing or denying transfer shall be filed in the office of the clerk of the district court in
which a transfer hearing is to be or has been held. The panel's order of transfer shall be
based upon a record of such hearing at which material evidence may be offered by any
party to an action pending in any district that would be affected by the proceedings under
this section, and shall be supported by findings of fact and conclusions of law based upon
such record. Orders of transfer and such other orders as the panel may make thereafter
shall be filed in the office of the clerk of the district court of the transferee district and
shall be effective when thus filed. The clerk of the transferee district court shall forthwith
transmit a certified copy of the panel's order to transfer to the clerk of the district court
from which the action is being transferred. An order denying transfer shall be filed in
each district wherein there is a case pending in which the motion for transfer has been
made.
(d) The judicial panel on multidistrict litigation shall consist of seven circuit and district judges
designated from time to time by the Chief Justice of the United States, no two of whom shall be
from the same circuit. The concurrence of four members shall be necessary to any action by the
panel.
(e) No proceedings for review of any order of the panel may be permitted except by
extraordinary writ pursuant to the provisions of title 28, section 1651, United States Code.
Petitions for an extraordinary writ to review an order of the panel to set a transfer hearing and
other orders of the panel issued prior to the order either directing or denying transfer shall be

filed only in the court of appeals having jurisdiction over the district in which a hearing is to be
or has been held. Petitions for an extraordinary writ to review an order to transfer or orders
subsequent to transfer shall be filed only in the court of appeals having jurisdiction over the
transferee district. There shall be no appeal or review of an order of the panel denying a motion
to transfer for consolidated or coordinated proceedings.
(f) The panel may prescribe rules for the conduct of its business not inconsistent with Acts of
Congress and the Federal Rules of Civil Procedure.
(g) Nothing in this section shall apply to any action in which the United States is a complainant
arising under the antitrust laws. Antitrust laws as used herein include those acts referred to
in the Act of October 15, 1914, as amended (38 Stat. 730; 15 U.S.C. 12), and also include the Act
of June 19, 1936 (49 Stat. 1526; 15 U.S.C. 13, 13a, and 13b) and the Act of September 26, 1914,
as added March 21, 1938 (52 Stat. 116, 117; 15 U.S.C. 56); but shall not include section 4A of the
Act of October 15, 1914, as added July 7, 1955 (69 Stat. 282; 15 U.S.C. 15a).
(h) Notwithstanding the provisions of section 1404 or subsection (f) of this section, the judicial
panel on multidistrict litigation may consolidate and transfer with or without the consent of the
parties, for both pretrial purposes and for trial, any action brought under section 4C of the
Clayton Act.
STATE COURT TO FEDERAL COURT
1441. Actions removable generally
REMOVAL - QUASI-VENUE STATUTE
(a) Except as otherwise expressly provided by Act of Congress, any civil action brought in a
State court of which the district courts of the United States have original jurisdiction, may be
removed by the defendant or the defendants, to the district court of the United States for the
district and division embracing the place where such action is pending. For purposes of removal
under this chapter, the citizenship of defendants sued under fictitious names shall be
disregarded.
Case can be removed by D when P could've brought suit into federal ct to begin
with
Used to have to petition to remove
NOW => file notice of removal
(b) Any civil action of which the district courts have original jurisdiction founded on a claim or
right arising under the Constitution, treaties or laws of the United States shall be removable
without regard to the citizenship or residence of the parties. Any other such action shall be
removable only if none of the parties in interest properly joined and served as defendants is a
citizen of the State in which such action is brought.
(c) Whenever a separate and independent claim or cause of action within the jurisdiction
conferred by section 1331 of this title is joined with one or more otherwise non-removable
claims or causes of action, the entire case may be removed and the district court may determine
all issues therein, or, in its discretion, may remand all matters in which State law predominates.
NOTES:
Subsection (a)
in the case of multiple defendants, all defendants must agree to removal
("defendant or defendants")
Subsection (b)
in cases based solely on diversity, "shall be removable ONLY if no party in
interest joined and served as a defendant is a citizen of the state where the
action is brought."
Cf. Notice of Removal Handout; Problems P 915
NOT "motion" for removal; no motion necessary
FOR EXAM: APPLIES ONLY TO DIVERSITY ( 1332) AND FEDERAL QUESTION ( 1331)
Fact pattern presented will probably be a Subject Matter Jurisdiction hypo where the Plaintiff
moves to "remand"
if m/ is GRANTED = NO REMOVAL
if m/ is DENIED = case is REMOVED

28 USC 1446. Procedure for removal

(a) A defendant or defendants desiring to remove any civil action or criminal prosecution from a State
court shall file in the district court of the United States for the district and division within which such
action is pending a notice of removal signed pursuant to Rule 11 of the Federal Rules of Civil
Procedure and containing a short and plain statement of the grounds for removal, together with a
copy of all process, pleadings, and orders served upon such defendant or defendants in such action.
(b) The notice of removal of a civil action or proceeding shall be filed within thirty days after the
receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth
the claim for relief upon which such action or proceeding is based, or within thirty days after the
service of summons upon the defendant if such initial pleading has then been filed in court and is not
required to be served on the defendant, whichever period is shorter.
If the case stated by the initial pleading is not removable, a notice of removal may be filed within
thirty days after receipt by the defendant, through service or otherwise, of a copy of an amended
pleading, motion, order or other paper from which it may first be ascertained that the case is one
which is or has become removable, except that a case may not be removed on the basis of jurisdiction
conferred by section 1332 of this title more than 1 year after commencement of the action.
(d) Promptly after the filing of such notice of removal of a civil action the defendant or defendants
shall give written notice thereof to all adverse parties and shall file a copy of the notice with the clerk
of such State court, which shall effect the removal and the State court shall proceed no further unless
and until the case is remanded.
28 USC 1447. Procedure after removal generally
(a) In any case removed from a State court, the district court may issue all necessary orders and
process to bring before it all proper parties whether served by process issued by the State court or
otherwise.
(b) It may require the removing party to file with its clerk copies of all records and proceedings in
such State court or may cause the same to be brought before it by writ of certiorari issued to such
State court.
(c) A motion to remand the case on the basis of any defect other than lack of subject matter
jurisdiction must be made within 30 days after the filing of the notice of removal under section
1446(a). If at any time before final judgment it appears that the district court lacks subject matter
jurisdiction, the case shall be remanded. An order remanding the case may require payment of just
costs and any actual expenses, including attorney fees, incurred as a result of the removal. A certified
copy of the order of remand shall be mailed by the clerk to the clerk of the State court. The State
court may thereupon proceed with such case.
(d) An order remanding a case to the State court from which it was removed is not reviewable on
appeal or otherwise, except that an order remanding a case to the State court from which it was
removed pursuant to section 1443 of this title shall be reviewable by appeal or otherwise.
(e) If after removal the plaintiff seeks to join additional defendants whose joinder would destroy
subject matter jurisdiction, the court may deny joinder, or permit joinder and remand the action to
the State court.
RATIONALE FOR REMOVAL
that defendants as well as plaintiffs should have the option to choose federal court cases within the fed
jurisdiction
28 USC 1441(a) provides that removal juris. should be available to df, "for the district and division"
where the PL brought the original action, only in cases that PL could have commenced in federal ct.
df may allege any facts necessary to demonstrate grounds for removal
Exception
28 USC 1441(b) provides that if a df is sued in his home state, he may not remove on basis
of diversity
General removal statute (1441) applies to cases, not claims
entire suit is removed, including both the specific claim that gave rise to removal, but any related
claims fed. ct. has power to hear under supplemental juris.
PROCEDURE FOR REMOVAL
State ct. complaint and answer will be filed with notice of removal under 28 USC 1446(a)

must be filed within 30 days of receiving plaintiff's pleading in the state suit
once notice is filed and state ct. is notified, state ct. loses control of case automatically under 28
USC 1447(d)
if df has not properly followed procedural requirements, PL may make m/ remand the case back to
state ct. under 28 USC 1447(c)
remand motion must be made within 30 days after removal, or objection is waived
REMOVAL
1
Everything about diversity and federal question jurisdiction - only difference is that subject
matter jurisdiction of district ct of US
1

Add layer of analysis - Is this case something that could've been filed into court by P?
a
If so, generally so, D can remove it
a Where do you file notice for removal?
a When to file?
How does D know where to file?
If P filed in fed district ct, meet reqmt for fed subject matter
Bases for fed jur
1331 - federal question
1332 - diversity of citizenship
1
ONLY EXC - in div case, D is citizen of state where action was brought, then idea is
that D is citizen of home state, no prejudice
a
1441(b)
a
Can't destroy div by switching cts
a
Once case properly removed, then case can be transferred to any fed dist ct
under 1404(a)
Various procedural reqmts set forth in stat - 1441, 1446, 1447
a
Jur pt - same
a
Mottley - say they filed in st ct originally, if RR tried to remove to fed ct, oh this is a
case arising under fed law under1331, would get kicked out same as P would get
kicked out bc can't base fed subj matt jur on an anticipated fed defense to be
raised by D

**All Ds served MUST join in removal

CANNOT unilaterally remove
1
Motion to Remand
If P wants to challenge removal => P files mtn to remand
If basis for technical violation, must be made within 30 days of notice for removal
1447 (c) mtn for reman
1
Motion to dismiss - 12(b)(1)-(2)
D wants to challenge juridiction
If removal for lack of jurisdiction, can be raised ANYTIME
AFTER REMOVAL TO FED. CT.
PROCEDURAL TO REMOVE
case proceeds in fed. ct. under FRCP 81(c)(2). Removed Actions.
Rule 81(c) Removed Actions.
(1) Applicability.
These rules apply to a civil action after it is removed from a state court.
(2) Further Pleading.
After removal, repleading is unnecessary unless the court orders it. A defendant who did not answer
before removal must answer or present other defenses or objections under these rules within the
longest of these periods:
(A) 21 days after receivingthrough service or otherwisea copy of the initial pleading stating
the claim for relief;
Sm # of states don't req that P serve complaint with summons

Normally, both serve with summons and complaint

(B) 21 days after being served with the summons for an initial pleading on file at the time of
service; or
(C) 7 days after the notice of removal is filed.
fed ct. may order parties to file discovery materials and other filings from state ct. under 28 USC
1446(a) (maybe 1447(b))
Other applicable statutes (Cf. P 918-919):
28 U.S.C. 1441(e)
removal provisions for multi-party, multi-forum situations where minimal diversity is met, and
litigation from accident resulting in death of 75 ppl
28 U.S.C. 1453
Class Action Fairness Act
removal of state law class actions where minimal diversity is met and AIC is more than
$5,000,000
Pleading std applies to notice of removal
Look to complaint on well-pleaded complaint rule to see if removal is justifiable
D needs to supplement and explain why there is federal jurisdiction for removal
P v. D1 + D2
IL
DE, MD Bahamas
P cannot file in MD state ct
IL - not removable bc no complete diversity jur
If in MD st ct, D can hopefully enjoy less out-of-state bias
FEDERAL COURT TO FOREIGN NATION OR STATE COURT TO STATE COURT/ FOREIGN
NATION
FORUM NON CONVENIENS
A.
PROPER WHEN ALL ARE MET:
A.
JURISDICTION
A.
VENUE
A.
NOTICE
Forum Non Conveniens (PP 837-849)
A.
1.

APPLICATION
FEDERAL COURT/ STATE COURT TO FOREIGN NATION
PIPER AIRCRAFT CO. (df/ pet) v. REYNO (PL/ resp) (1981) P 837
Reyno (PL) v. Piper (df) + Hartzell (df)
FACTS
In July 1976 a small commercial aircraft crashed in Scotland, killing the pilot and
five passengers instantly. The aircraft was manufactured in Pennsylvania by Piper
Aircraft Co., and the propellers were manufactured in Ohio by Hartzell Propeller,
Inc. The aircraft was registered in Great Britain, owned by Air Navigation and
Trading Co., Ltd. (Air Navigation), and operated by McDonald Aviation, Ltd.
(McDonald). After reviewing the crash, the British Department of Trade
determined that there was no evidence of defective equipment. In 1977, a
California probate court appointed Gaynell Reyno as administratrix of the estates
of the five passengers (Plaintiff). Plaintiff filed wrongful death actions against both
Piper and Hartzell (Defendants) in the Superior Court of California, claiming
negligence and strict liability. Air Navigation, McDonald, and the estate of the pilot
were not parties to this case, because Plaintiff had already filed a case against them
in the United Kingdom. Plaintiff admitted that this suit was filed in the United
States, because its laws regarding liability, capacity to sue, and damages were more

favorable to Plaintiff. Scotland did not recognize strict liability actions, and only
allowed wrongful death actions to be brought by decedent's relatives. After the suit
was removed to the United States District Court for the Central District of
California, Piper filed a Motion to Transfer the action to the United States District
Court for the Middle District of Pennsylvania. Hartzel moved to dismiss for lack of
personal jurisdiction, or in the alternative, to transfer. The district court quashed
service on Hartzel, and transferred the case to Pennsylvania. Service was then
properly obtained on Hartzel. In May, 1978, after transfer to Pennsylvania, both
Piper and Hartzell moved to dismiss based upon forum non conveniens. The
district court granted those motions, but on appeal, based upon the test in Gulf Oil
v. Gilbert. The United States Court of Appeals for the Third Circuit reversed and
remanded, stating that dismissal is never appropriate when the law of the
alternative forum is less favorable to the plaintiff. Supreme Court reverses App. Ct.
decision, since the decision of the district court complies with the standard established
in Gulf Oil v. Gilbert. The proper standard for determining whether an action will be
dismissed for forum non conveniens was established in Gulf Oil v. Gilbert. The court
of appeals improperly considered the difference in substantive law between the two
forums, when making its decision regarding forum non conveniens.
RULE OF LAW
When an alternative forum has jurisdiction to hear a case, and when trial in the
chosen forum would establish oppressiveness and vexation to a defendant out of
proportion to the plaintiff's convenience, or when the chosen forum is
inappropriate because of considerations affecting the court's own administrative
and legal problems, the court may, in the exercise of its sound discretion, dismiss
the case for forum non conveniens. Gulf Oil Corp. v. Gilbert.
ANALYSIS
Piper moved to change venue under 1404(a)
Under what standard?
where dist. ct. may transfer to any other dist. ct. where action may have been
brought based on PJ and Venue:
Venue
of a defendant that is a corporation under 1391(c) - Piper +
Hartzell
PJ
Piper's specific jurisdiction based on minimum contacts
Piper located in PA
Hartzell's specific jurisdiction based on its stream of commerce
into PA
Hartzell moved to change venue under 1406(a), claiming PJ
was improper
THUS both s moved to dismiss on the ground of forum non conveniens
Gilbert v. Gulf Oil cases - MEMORIZE FACTORS
Balancing test - considerations made
PRIVATE INTEREST FACTORS AFFECTING THE CONVENIENCE OF
LITIGANTS (Cf. note 6, P 839)
1. relative ease of access to sources of proof
where the relevant evidence is located
2. availability of compulsory process for attendance of unwilling, and the
cost of obtaining attendance of willing, witnesses
when witnesses are located beyond the reach of compulsory process, requiring
extensive investigation by defendants would defeat the purpose of the motion
affidavits describing evidentiary problems may bolster defendants motion
3. possibility of a view of the premises, if a view would be appropriate to the
action

4. all other practical problems that make trial of a case easy, expeditious and
inexpensive
forcing a defendant to rely on subsequent actions for indemnity or
contributions because of trial in plaintiff's forum would be burdensome, but
not unfair
A
Joinder of other parties of interest
A
Implead as 3rd party complaint - can't be done abroad
NOTE: burdensome = supports dismissal on grounds of forum non
conveniens
PUBLIC FACTORS
PUBLIC INTEREST FACTORS AFFECTING THE CONVENIENCE OF THE
FORUM (Cf. note 6, P 839)
1. administrative difficulties flowing from court congestion
2. local interest in having localized controversies decided at home
3. interest in having trial of a diversity case in a forum that is at home with
the law that must govern the action
Choice of Law analysis
if two or more sets of laws apply to different defendants, the result would
be too confusing to a jury
lack of familiarity of foreign law may be confusing to the court
a forum's interest in the litigation must be sufficient
4. the avoidance of unnecessary problems in Choice of Law rules
Cf. application of Choice of Law rule by transferor under 1404(a)/ transferee
under 1406(a) and 1631, above
5. unfairness of burdening citizens in an unrelated forum with jury duty
Fed ct will apply choice of law rules in st where case sits
Fed ct => fed ct
Presumption of 1404(a) - jurisdiction and venue proper in orig ct
Choice of law => transferred to transferee state
2 choice of laws apply to 2 diff D
Scotland => Scottish citizens died
US => Am made products
1. STATE COURT TO STATE COURT
REVIEW OF WHAT CAN USE TO AFFECT VENUE
Where files suit Where wants the suit Doctrine used by to move the suit
State court another state ct, or a foreign ct Forum non conveniens
Federal court another federal court 1404(a); 1406(a); 1631
Federal court foreign court (another country) Forum non conveniens
State court federal court Removal
28 U.S.C. 1404. Change of venue
(a) For the convenience of parties and witnesses, in the interest of justice, a district court may transfer
any civil action to any other district or division where it might have been brought.
Transferor's Choice of Law rule applies
jurisdiction and venue in original court was proper
28 U.S.C. 1406. Cure or waiver of defects
(a) The district court of a district in which is filed a case laying venue in the wrong division or district
shall dismiss, or if it be in the interest of justice, transfer such case to any district or division in which
it could have been brought.
Transferee's Choice of Law rule applies
did not file suit in the proper district
since fucked up by not filing in proper jurisdiction, ct does not allow that to bring his chosen
ct's law with him.

28 U.S.C. 1631. Transfer to cure want of jurisdiction

Whenever a civil action is filed in a court as defined in section 610 of this title or an appeal, including a
petition for review of administrative action, is noticed for or filed with such a court and that court
finds that there is a want of jurisdiction, the court shall, if it is in the interest of justice, transfer such
action or appeal to any other such court in which the action or appeal could have been brought at the
time it was filed or noticed, and the action or appeal shall proceed as if it had been filed in or noticed
for the court to which it is transferred on the date upon which it was actually filed in or noticed for the
court from which it is transferred.
Transferee's Choice of Law rule applies
did not file suit in the proper district
since fucked up by not filing in proper jurisdiction, ct does not allow that to bring his chosen
ct's law with him.
forum non conveniens
The doctrine that an appropriate forum even though competent under the law may divest itself
of jurisdiction if, for the convenience of the litigants and the witnesses, it appears that the action
should proceed in another forum in which the action might also have been properly brought in the
first place

SUBJECT MATTER JURISDICTION

"What type of case does a particular court have the power to hear?"
unlike PJ, SJ NEVER waived during the course of a case; parties cannot confer this type of jurisdiction
on a court that does not have it
TYPES OF CASES COURTS CAN HEAR
Jurisdiction set up through statutes, bounds of Constitution
1
LIMITED - court whose jurisdiction is limited by statutory provisions
MUST have reason to get into federal court
1
GENERAL - court that has statutory power to hear any kind of cases
Like 4(k)(1) - federal court looks at state's long-arm statute
State court in that court has jurisdiction to hear ANY type of case, unless it belongs in a
specialized court
1
CONCURRENT - case that could be brought in federal court but if statute allows concurrent
jurisdiction, it can be heard in state courts also
Fed law - 42 USC 1983 - can be brought into state court also even though it's a federal
law
1
EXCLUSIVE - when federal statutes reserves jurisdiction to federal courts, case CANNOT be
heard in state court
i.e. Antitrust cases
TWO WAYS TO GET ORIGINAL JURISDICTION
1
DIVERSITY JURISDICTION
Some are the same terms as personal jurisdiction but different meaning
If question asking about court's subject matter jurisdiction pending in federal district court,
DO NOT WORRY about Constitution
Rule 3 has better coverage than 1331, 1332, and 1441
A civil action is commenced by filing a complaint with the court.
1
1

Rules in Statute, SC case law

REAL policy - to prevent against prejudice against non-state residents
Policy to include federal diversity jur - guard against perceived prejudice against
out-of-state parties or against foreigners
Home-towning - home game advantage
i. Citizens from different states
1. Outsider is supposedly protected from degree of prejudice by filing in federal court
rather than state court

CORPORATIONS
8(a)(1) - short plain statement of grounds for jurisdiction
Forms 7 - statemtn of jurisdiction
7(a) - diversity of citizenship
Problem #11
P v. Umbrella + D.Corp
PA
UT, TX DE, PA
DE, PA
Hertz Corp. (df) v. Friend, et al. (PL) 2009 TWEN
Friend (CA) + Nhieu (CA) + s unnamed class members v. Hertz Corp.
(incorporated in NJ/ principal place of business = CA?; NJ?)
NOTE: case law states citizenship of a class is based on the citizenship of the
named parties
named s are from CA
Hertz' principle place of business
executive offices ("nerve center") located in NJ
largest business operations in CA
ISSUE
Where the defendant's nerve center is in one state (NJ) and the majority of
their operations/ business is conducted in another state (CA), is the nerve
center the determinant factor in establishing a principal place of business for
diversity jurisdiction under 28 USC 1332(c)(1)?
RULE
28 USC 1332(c)(1)
(c) For the purposes of this section and section 1441 of this title-(1) a corporation shall be deemed to be a citizen of any State by which
it has been incorporated AND of the State where it has its principal
place of business
HOLDING
Yes. A corporation's "nerve center," typically found at its corporate
headquarters, is its principal place of business.
What about citizenship of unnamed class members?
No - ONLY look to citizenship of named parties
DIRECT ACTION
Look at citizenship of ins co and the insured bc of possibility of collusion in destroying
diversity
Injured party sues party itself with insurer in background paying claim but not
named a party
DE has highly developed law of corporations
1332(c) - one of states of citizenship - incorp'd and place of business
Only applies w/ direct actions where insurer is not named party due to contract
with liability ins
Liability ins - ins against claims against you where you would be liable
Problem #12
Posey v. Delivery Corp - diversity exists
LP
DE, TX
OK, AK
w/ respect of partnerships, of what state are partners citizens of?

Kramer v. Panama
TX
Phony assignment bc Haitian corp had claims to collect
i

LIMITATIONS
1. COMPLETE DIVERSITY RULE
1. Statute itself doesn't say that
1. Can't be party who is citizen of same state on both sides of V
MUST have complete diversity of citizenship
P1 + P2 v. D1 + D2
FL GA FL AL - some diversity but not complete diversity

1.

Strawbridge v. Curtis
Complete diversity - not in 1332 (a) but old standing interpretation
Minimum diversity - 2 Ds from SAME state doesn't destroy diversity diversity on both sides of V
i
Exxon - we don't have original jurisdiction in this case - 1332(a)
MINIMAL DIVERSITY - 1332(d) - CAFA
1.
P altogether cannot aggregate claims, clajming more than $5mil
1. As long as one D is different from other D
1. Unless in CAFA section, 1332 means regular diversity
CLASS ACTION FAIRNESS ACT
Codified in 1332 (d)
1453 rules when removing for subject matter jur based on class actions
Not given class action certification - scrutiny
Congress wanted more class actions to be brought in federal ct w/ belief that
fed ct would be stricter
"Regular Diversity"

CAFA

1 Complete diversity

Minimal diversity 1332(d)

If any P different from any D => minimal => within
Constitutional limits

1 No aggregation of claims by sep P

P1(40) P2 (50) 90 (fails)

$5,000,000 and allows aggregation of claims

Not difficult if you incl punitive times

1 No D can be citizen of forum st where action

was filed for action to be removed -
1441(b)

Citizenship of D irrelevant - 1453 (b)

1 One year limit in diversity case - 1446(b)

No time limit on removability - 1453(b)

1 All Ds must unanimously join in and agree

for removal

Any D can unilaterally remove case - 1453 (b)

1 Remand order to state ct is normally NOT

appealable - 1447(d)
GEN RULE - if D removes and ct decides
case should be remanded, normally can't
be done

Remand order can be appealed within 7 days of

remand order at app. Ct's discretion - 1453(c)(1)

Class action in st ct dwindling bc any case can about get into fed ct
Definiteive exc to jur under CADa

Intent to exc clear

Westerfield v. Independent Processing
Westerfield + MO residents v. Independent + Provident
MO
MO
CA
56 loans
3891 loans (primary D)
Not removal under normal diversity of citizneship
Minimal diversity, exceeds $5mil
P move to remand on 1332(d)(4)
1332(d)(4)(B) - 2/3+ members and primary D are citizens of state
Provident is primary D + resident of CA
IND - 56 laons
Prov - 3891 loans
All P class members citizens of MO
Is Ind someone from whom significant relief is req'd?
Counts
1-2 => class 1 against Ind
3-4 => class 2 against Prov
Person seeking to get into fed ct initially bears burden to show fed jur
Exc applicability - has burden to prove that
If there is doubt, ruling against person w/ burden
TC - applied wrong std of proof
Discretionary decline of jur
1332(d)(3) - less than 2/3
If more than 2/3 => mandatory 1332(d)(4)
1453. Removal of class actions
(a) Definitions.--In this section, the terms class, class action, class certification
order, and class member shall have the meanings given such terms
under section 1332(d)(1).
(b) In general.--A class action may be removed to a district court of the United
States in accordance with section 1446 (except that the 1-year limitation
undersection 1446(b) shall not apply), without regard to whether any defendant is
a citizen of the State in which the action is brought, except that such action may be
removed by any defendant without the consent of all defendants.
(c) Review of remand orders.-(1) In general.--Section 1447 shall apply to any removal of a case under this
section, except that notwithstanding section 1447(d), a court of appeals may
accept an appeal from an order of a district court granting or denying a
motion to remand a class action to the State court from which it was
removed if application is made to the court of appeals not more than 10 days
after entry of the order.
(2) Time period for judgment.--If the court of appeals accepts an appeal
under paragraph (1), the court shall complete all action on such appeal,
including rendering judgment, not later than 60 days after the date on which
such appeal was filed, unless an extension is granted under paragraph (3).
(3) Extension of time period.--The court of appeals may grant an extension
of the 60-day period described in paragraph (2) if--

(A) all parties to the proceeding agree to such extension, for any
period of time; or
(B) such extension is for good cause shown and in the interests of
justice, for a period not to exceed 10 days.
(4) Denial of appeal.--If a final judgment on the appeal under paragraph (1)
is not issued before the end of the period described in paragraph (2),
including any extension under paragraph (3), the appeal shall be denied.
(d) Exception.--This section shall not apply to any class action that solely involves-(1) a claim concerning a covered security as defined under section 16(f)(3) of
the Securities Act of 1933 (15 U.S.C. 78p(f)(3) [FN1]) and section 28(f)(5)(E)
of the Securities Exchange Act of 1934 (15 U.S.C. 78bb(f)(5)(E));
(2) a claim that relates to the internal affairs or governance of a corporation
or other form of business enterprise and arises under or by virtue of the laws
of the State in which such corporation or business enterprise is incorporated
or organized; or
(3) a claim that relates to the rights, duties (including fiduciary duties), and
obligations relating to or created by or pursuant to any security (as defined
under section 2(a)(1) of the Securities Act of 1933 (15 U.S.C. 77b(a)(1)) and
the regulations issued thereunder).
1

AMOUNT IN CONTROVERSY
STATUTORY
Amt in controversy - limits not granted by Constitution
Mas (PL) v. Perry (df) 1974 P 851
Jean (FRA) and Judy (LA?; MS?) Mas v. Perry (LA)
NOTE: Under FRCP 12(h)(3)
court MUST dismiss action if it determines at any time that it lacks
subj. matter jurisdiction
Establishing a "citizen of a State" under 1332
1. must be a citizen of the United States
2. must be domiciled in that State
a) resident of that State
b) intent to remain indefinitely in that State
Establishing adequacy of "amount in controversy"
1. Plaintiff's claim must be made in good faith
2. Defendant is unable to show, to a legal certainty, that the plaintiff
could NEVER possibly recover up to the amount in controversy
if can show could never possibly recover up to jurisdictional amount
($75,000), then 1332(b) applies:
"district court may deny costs to, and impose costs on, the
plaintiff"
NOTE: "costs" do NOT include attorney's fees

St. Paul Mercury - p. 853

It must appear to a legal certainty that the claim is really for less than the jurisdictional
amount to justify dismissal. The inability of the plaintiff to recover an amount adequate
to give the court jurisdiction does not show his bad faith or oust the jurisdiction
Easy to go backward, P doesn't have to prove amt with legal certainty
Under governing law, even though their claim of amt of controversy, doesn't need
legal certainty
Place of domicile - MUST be a US citizen, live in US state with the intent to remain
permanently
Place of his true, fixed, and permanent home and principal establishment, and to
which he has intention of returning whenever he is absent therefrom
Change of domicile may be effected ONLY by a combination of TWO elements:
1
Taking up residence in a different domicile

Intent to remain there

If Mr. Mas was a French citizen - new provision or amendment

An alien admitted to the United States for permanent residence shall be deemed a
citizen of the State in which such alien is domiciled.
Prov didn't exist at time of Mas v. Perry - if existed, outcome would be different
Mr Mas would be a citizen of LA, losing diversity of citizenship
EXCEPTION
Ankenbrandt v. Richards - p. 860
SC => Domestic Relations excluded from diversity jurisdiction (EXCEPTION)
Domestic relations exception relates to CORE issues of divorce law
1
Child Support
1
Alimony
1
Property division
State court experts in divorce law
EXCEPTION TO EXCEPTION
1. Tort claim liability - has federal jurisdiction
NOT a core issue of divorce and can meet amt in controversy
2. Probate court - traditionally exercised by state courts
Facially diversity jurisdiction cases but NOT
STATUTORY LIMIT OF THE COURT'S SUBJECT MATTER JURISDICTION UNDER
DIVERSITY
1332. Diversity of citizenship; amount in controversy; costs
(a) The district courts shall have original jurisdiction of all civil actions where the matter
in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is
between-(1) citizens of different States;
(2) citizens of a State and citizens or subjects of a foreign state;
(3) citizens of different States and in which citizens or subjects of a foreign state are
additional parties; and
(4) a foreign state, defined in section 1603(a) of this title, as plaintiff and citizens of
a State or of different States.
For the purposes of this section, section 1335, and section 1441, an alien admitted
to the United States for permanent residence shall be deemed a citizen of the State
in which such alien is domiciled.
(b) Except when express provision therefor is otherwise made in a statute of the United
States, where the plaintiff who files the case originally in the Federal courts is finally
adjudged to be entitled to recover less than the sum or value of $75,000, computed
without regard to any setoff or counterclaim to which the defendant may be adjudged to
be entitled, and exclusive of interest and costs, the district court may deny costs to the
plaintiff and, in addition, may impose costs on the plaintiff.
(c) For the purposes of this section and section 1441 of this title-(1) a corporation shall be deemed to be a citizen of any State by which it has been
incorporated and of the State where it has its principal place of business, except
that in any direct action against the insurer of a policy or contract of liability
insurance, whether incorporated or unincorporated, to which action the insured is
not joined as a party-defendant, such insurer shall be deemed a citizen of the State
of which the insured is a citizen, as well as of any State by which the insurer has
been incorporated and of the State where it has its principal place of business; and
(2) the legal representative of the estate of a decedent shall be deemed to be a
citizen only of the same State as the decedent, and the legal representative of an
infant or incompetent shall be deemed to be a citizen only of the same State as the
infant or incompetent.

NOTE: Hertz Corp. v. Friend, et al. 2009

ruling a corporation's principal place of business is its nerve center
(e) The word States, as used in this section, includes the Territories, the District of
Columbia, and the Commonwealth of Puerto Rico.
1332 requires complete diversity, unless otherwise specified in a statute
CONSTITUTIONAL LIMIT OF THE COURT'S SUBJECT MATTER JURISDICTION
UNDER DIVERSITY
if not in the list in Art. III 2, the case is NOT PROPER constitutionally under subject
matter jurisdiction
Sets forth parameters of jurisdiction of federal courts
Constitution Art. III 2
Section 2, Clause 1. Jurisdiction of Courts
Section 2. The judicial Power shall extend to all Cases, in Law and Equity, arising
under this Constitution, the Laws of the United States, and Treaties made, or which
shall be made, under their Authority;--to all Cases affecting Ambassadors, other
public Ministers and Consuls;--to all Cases of admiralty and maritime
Jurisdiction;--to Controversies to which the United States shall be a Party;--to
Controversies between two or more States;--between a State and Citizens of
another State;--between Citizens of different States;--between Citizens of the same
State claiming Lands under Grants of different States, and between a State, or the
Citizens thereof, and foreign States, Citizens or Subjects.
Section 2, Clause 2. Supreme Court, Original and Appellate Jurisdiction
In all Cases affecting Ambassadors, other public Ministers and Consuls, and those
in which a State shall be Party, the supreme Court shall have original Jurisdiction.
In all the other Cases before mentioned, the supreme Court shall have appellate
Jurisdiction, both as to Law and Fact, with such Exceptions, and under such
Regulations as the Congress shall make.
Section 2, Clause 3. Criminal Trial by Jury
The Trial of all Crimes, except in Cases of Impeachment, shall be by Jury; and
such Trial shall be held in the State where the said Crimes shall have been
committed; but when not committed within any State, the Trial shall be at such
Place or Places as the Congress may by Law have directed.
Constitution requires only minimum diversity
1

FEDERAL QUESTION JURISDICTION PP 864-888

28 U.S.C. 1331. Federal question
The district courts shall have original jurisdiction of all civil actions arising under the
Constitution, laws, or treaties of the United States.

PROGRESSION OF SUBJECT MATTER JURISDICTION BASED ON A FEDERAL

QUESTION ( 1331)
claim "creates" a COA --> Mottley (1908)

vindication of a right under state law turns on some construction of federal law --> Smith
(1921)
non-compliance with a federal regulation constituting negligence is "not
sufficiently substantial" to support arising-under jurisdiction --> Merrell Dow
(1986)
a claim recognized by state law that turns on an embedded federal issue that IS
sufficiently substantial to support arising-under jurisdiction based on the 4
standards set by the ct.--> Grable (2005)
Standards established by Grable for whether a state claim should appear in fed. ct.
under 1331
1. whether the fed law is actually disputed or contested
2. whether the issue is substantial
3. whether the government has an interest in having this COA heard in a
federal forum
4. maintaining the balance of power between federal and state judicial
powers
WELL PLEADED COMPLAINT RULE - can't create federal jurisdiction by raising federal
defense
i. SC - P's claim itself has to be referred to and rely on federal law in order for case to arise
under federal law for purposes of 1331
i. Issue of Federal law must arise in P's complaint
Could be a docket limitation mechanism and looked at filing of complaint
Court needs to be able to determine jurisdiction at the time of filing of complaint
P's COA doesn't invoke federal law
Court brings 12(b)(1) itself - Subject matter jurisdiction NEVER waived
1331 - 99% of all federal question cases
MOST claims of federal law are based in federal law
RARE situations => P's COA based on state law
There is some effect on federal law that is enough to make it "arise from
federal law" alleged under 1331
State law COA - federal issue incorporated within state claim
P cannot anticipate that D is going to bring up federal defense that involves federal issue
if P herself relies on state law
There are other bases for federal subject matter jurisdiction
MOST important when US govt is a party
No diversity
P doesn't rely on federal law
Might still have case that falls under 1331 arising federal law if it's a case like
Grable
Provides that federal district court has subject matter jurisdiction when there is a claim arising
from federal law
1.
Federal Constitutional Law
Art. III, 2 - outer limits of federal courts w/ respect to federal question
The judicial Power shall extend to all Cases, in Law and Equity, arising
under this Constitution, the Laws of the United States, and Treaties made, or
which shall be made, under their Authority;--to all Cases affecting
Ambassadors, other public Ministers and Consuls;--to all Cases of admiralty
and maritime Jurisdiction;--to Controversies to which the United States
shall be a Party;--to Controversies between two or more States;--between a
State and Citizens of another State;--between Citizens of different States;-between Citizens of the same State claiming Lands under Grants of different
States, and between a State, or the Citizens thereof, and foreign States,
Citizens or Subjects.
Language - cases that arise under federal law

1.

1.
1.

Unlike Constitutional/ Statutory provision

Federal Statute
Statutory => 1331 reads like Constitution
1331. Federal question
The district courts shall have original jurisdiction of all civil actions arising
under the Constitution, laws, or treaties of the United States.
Statutory grant didn't occur until 1875
State courts were being resistant to fedeal law
Original grant of federal jurisdiction - amt in controversy - amt no
longer exists
Federal Rule i.e. FRCP
Ordinance of Agency

KEY QUESTION - When does a case arise under Federal Law?

Louisville & Nashville R.R. (df/ appellant) v. Mottley (PL/ appellee) P 865
MAJOR limitation on language of statute
Mottley (KY) v. RR (KY)
FACTS
Mr. and Mrs. Mottley (Appellees) are domiciliaries of the State of Kentucky and
brought suit in the Circuit Court for the Western District of Kentucky against
Louisville & Nashville R.R. (Defendant), a railroad company and citizen of
Kentucky. Appellees, while passengers on the railroad, were injured by Defendant's
alleged negligence. The Appellees sought specific performance of a contract entered
into between themselves and Appellant. The contract originally provided that, in
consideration for the Appellees releasing the Appellant from all claims resulting
from injuries received during an accident, the Appellant would provide free
passage for life on its rail lines. Although the contract was honored for
approximately thirty-six years, the Appellant, in 1907, refused to issue new tickets.
The appellant based its decision upon an act of Congress, which forbid the granting
of free passes or transportation.
s COA
breach of K
s response
filed demurrer (m/ dismiss) for failure to state a claim under FRCP 12(b)(1)
did NOT file m/ dismiss for lack of jurisdiction
Jurisdictional History
Fed Cir. Ct.
overruled demurrer/ judgment for
appeals
Fed. Supr. Ct.
court itself moved to dismiss for lack of jurisdiction (to remove to state circuit ct.)
No Constitutional application for breach of K as COA in fed. ct.
State Cir. Ct.
judgment for
appeals
State Supr. Ct.
had proper jurisdiction to hear this appeal of this COA
RULE OF LAW
28 U.S.C. 1331. Federal question
The district courts shall have original jurisdiction of all civil actions arising under
the Constitution, laws, or treaties of the United States.
Well-pleaded complaint rule
The federal question must appear as part of the plaintiff's cause of action as set out
in a well-pleaded complaint.

HOLDING
It is not enough that the Appellant allege some anticipated defense to his cause of
action, and asserts that the defense is invalidated by some provision of the
Constitution, or other federal statute. The federal question allegation must be on the
face of Appellee's well-pleaded complaint. In the case before the court, the Appellees
attempt to assert that an anticipated defense to their complaint will be barred by the
United States Constitution. This, as the court held, is not enough to sustain federal
question jurisdiction
KY SC has federal jurisdiction. Why?
Dispositive federal question
Breath of SC's jurisdictional provisions, when case goes through federal system,
original district court idn't have
KYSC hearing from 28 US 1257
(a) Final judgments or decrees rendered by the highest court of a State in
which a decision could be had, may be reviewed by the Supreme Court by
writ of certiorari where the validity of a treaty or statute of the United States
is drawn in question or where the validity of a statute of any State is drawn
in question on the ground of its being repugnant to the Constitution, treaties,
or laws of the United States, or where any title, right, privilege, or immunity
is specially set up or claimed under the Constitution or the treaties or
statutes of, or any commission held or authority exercised under, the United
States.
As long as highest court of state has federal question, final court will hear
case
.Court deprives its appellate jurisdictionfinal state court judgment
HIERARCHY OF FEDERAL STATUTE
Hierarchy of application of 1331
i. Express private right of action (MOST CASES)
28 USC 1331 applies
cause of action "arises under" federal law
i.
Typical stat that says employers should not discrminate for race, age, gender
i.
Says expressly in stat and ppl who are discriminated against have right to sue
their employee
i. Implied private right of action by Congress (if there is no "express")
Factors that ct will consider in determining whether statute provides implied COA
28 USC 1331would NOT be applied if any of the following 4 standards are
shown:
1. s are not part of the class for whose special benefit the statute was passed
2. The indicia of legislative intent reveals no congressional purpose to provide a
cause of action
3. a federal COA would not further the underlying purposes of the legislative
scheme
4. The respondents' COA is a subject traditionally relegated to state law

Employers should not discr employees for race, age, gender

a.
Doesn't mention whether anyone can sue
a.
Will try to use stat under pvt rihgt of action under 1331 and ct decides if
Congress mean to give P's pvtt right of action to sue for violation of statute
i.
YES, there is pvt right of action => 1331
No pvt right of action
If there is no implied private right of action, or parties' concede such, then there is no
federal question (LEAST CASES)

1.

No express right of action and either ct has held that there is no implied pvt right of
action or parties concede there is no implied pvt right of action but is STILL some
part of other state law
Grable & Sons Metal Products, Inc. (PL/ pet) v. Darue Engineering &
Manufacturing (df/ resp) 2005 P 873
FACTS
In 94, the IRS seized real property belonging to Grable to satisfy a
delinquent tax debt. The IRS gave notice by certified mail as required
by Title 26 USC 6335; and this would become the foundation for the
claim. The IRS sold the property to Darue, after notification of
Grable. And after Grable did not exercise its statutory right to redeem
the property after 180 days, it was sold. Five years later, Grable
brought a quiet title action in state court (MI?) claiming that Darues
title was invalid because the IRS had notified Grable incorrectly.
Grable claimed that the statute, 6335(a) required that written notice
be given by the secretary to the owner or left at his usual abode.
Grable argued that certified mail didnt count.
Darue removed the case to federal court after Grable brought the
original claim to state court. Darue filed that the complaint raised a
federal question, because the claim of title depended on the
interpretation of the notice statute in the federal tax law. The District
Court declined to remand the case, as plaintiff requested, for even
though the federal claim of Grables wasnt enough to win, it could keep
fed. Jurisdiction for the case. The court granted summary judgment for
the defendant, explaining that sufficient compliance with the statute was
enough, they didnt have to hand deliver the notice. The court of appeals
for the Sixth Circuit affirmed. The Supreme court only granted cert to
review the jurisdictional issue. The question for the Supreme Ct was
whether Merrell Dow always required a federal cause of action as a
condition for exercising federal question jurisdiction.
ISSUES
1) Whether the holding in Merrell Dow v. Thompson (that a title claim
DOES raise an issue of federal law that must be resolved, thereby
implicating a federal interest) ALWAYS requires a federal cause of
action for exercising fed. question jurisdiction.
NO. Merrell didnt make a bright line rule, it left discretion to the
judges. It showed that other remedies were available to THIS in state
ct. If federal labeling without an arising under claim could get in, then
any federal standard w/o a federal claim could get in, thereby opening
the floodgates.
2) Whether a state-law claim necessarily raises a stated federal issue
(under 1331), actually disputed and substantial, which a federal
forum may entertain without disturbing any congressionally approved
balance of federal and state judicial responsibilities.
MAYBE. Federal forum's ability to hear an embedded issue could only
be evaluated after considering the "welter of issues regarding the
interrelation of federal and state authority and the proper management
of the federal judicial system."
Standards established by this court for whether a state claim
should appear in fed. ct. under 1331
1. whether the fed law is actually disputed or contested
2. whether the issue is substantial
3. whether the government has an interest in having this
COA heard in a federal forum

4. maintaining the balance of power between federal and

state judicial powers
Why this ct held in favor of Grable:
there was no other forum available to provide a remedy, for
the rare state quiet title claim under federal law, except in
federal court
EXAM ANALYSIS POINT
Fact pattern will have a state law COA that violates a federal statute
OTHER RULES UNDER SUBJECT MATTER JURISDICTION
28 USC 1359. Parties collusively joined or made
A district court shall not have jurisdiction of a civil action in which any
party, by assignment or otherwise, has been improperly or collusively made
or joined to invoke the jurisdiction of such court.
U.S.C. Const. Art. III 1
Section 1. The judicial Power of the United States, shall be vested in one
supreme Court, and in such inferior Courts as the Congress may from time
to time ordain and establish. The Judges, both of the supreme and inferior
Courts, shall hold their Offices during good Behaviour, and shall, at stated
Times, receive for their Services, a Compensation, which shall not be
diminished during their Continuance in Office.
1.

1.

Smith v. KC Title p. 880

P - bond holder - KC title - shareholder
COA - breach of fiduciary duty
Bonds under federal statute allowing issuance of bonds
Smith - issuance is unconstitutional
Necessary to decide whether federal statute was Constitutional
Ct didnt consider facts bc law hadn't developed
Arises only under Statute
"Federal ingredient" that allows federal question
jurisdiction
Constitutional grant - broader set forth in Osborne
Osborne v. Bank of United States p. 888
Congress could grant the federal court jurisdiction over a
"whole case" so long as a federal issue was an "ingredient in the
original cause" asserted
Statute more limited than Constitutional

Merell Dow
P had one of its 6 state law claims, which was negligence per se
Bc you violated statute, state law => neg per se
FDCA - products shall not be labeled in a deceptive way, subject to suit by P
injured by deceptive product
Doesn't give right of action
Whether Congress intended on an implied right of action
Depends on judge
Confusion after Merell - Does it mean that when a court finds no implied COA, you
can't have claim under 1331?
Grable => Yes, can still have federal question jurisdiction
ESSENTIAL ELEMENTS p. 876
1.
State law claim necessarily raises federal law
1331 - "arising under federal law"
Holmes - Am. Well Works
Look at whether it's a federal or state claim and it ends there cts never agreed with Holmes

1.

1.
1.

Actually disputed
Moore v. Chesapeake p. 880
If Chesapeake had shown to have violated particular federal statute,
state law cannot raise assumption of risk as a defense
Not Moore's negligence under state law
Like Mottley - anticipated federal defense
Federal issue not embedded in state issue
Fed issue MUST be disputed
In contrast, claims to land in West set up through federal govt - title issues go
towards fed govt - federal ingredient
Has to be in case NOW
Federal issue is substantial
Govt has a strong interest in tax issues - MOST important federal
issue
No disturbance of federal/state judicial responsibility
MOST difficult to apply
If ct decides to grant federal question jurisdiction, does it open
floodgates to litigation?
YES - ct will probably step back
Congress has not created private rights of action for P
Less inference
Merrell - neg per se
If that were deemed to arise under federal law, tons of cases from state court
would flock to federal ct
Grable - quiet title action
Almost never brought into federal ct
COA based on federal IRC is extremely unlikely - important
consideration
Ct allowed bc it would not carry great precedence bc quiet title action

EXPRESSED v. IMPLIED RIGHTS OF ACTION

EXPRESSED

IMPLIED

a.k.a expressed COA

Statute itself doesn't indicate whether P has right to sue on that

statute

i.e. If US Congress passed 1983, any person whose

Constitutional rights violated by state official, can sue in
federal ct => 1331

YES

1331
complicated

NO

Whether its arising from federal law is mo

SUPPLEMENTAL JURISDICTIONAL
"Federal claim"

"Non-federal claim"

Arising under fed law

Arising under state law

Claim that culd've been brought into fed dist ct originally and there is fed
subj matt jur standing on its own

If you looked at it alone, there would be no fede

subj matt jurisdiction

If you can get everything in case under 1331/1332, don't need supplemental If looking on its own, no fed subj matt jur to ana
jur
1367

Cf. Supplemental Jurisdiction Handout

Used as a backup, if original (subject matter) jurisdiction cannot be satisfied
"Once we are validly in a federal district court, how can we bring in other parts of this case without
affecting jurisdiction?"
CONSTITUTIONAL BOUNDS OF SUPP. JURIS.
U.S.C.A. Const. Art. III 2
Section 2, Clause 1. Jurisdiction of Courts
Section 2. The judicial Power shall extend to all Cases, in Law and Equity, arising under this
Constitution, the Laws of the United States, and Treaties made, or which shall be made, under
their Authority;--to all Cases affecting Ambassadors, other public Ministers and Consuls;--to all
Cases of admiralty and maritime Jurisdiction;--to Controversies to which the United States
shall be a Party;--to Controversies between two or more States;--between a State and Citizens
of another State;--between Citizens of different States;--between Citizens of the same State
claiming Lands under Grants of different States, and between a State, or the Citizens thereof,
and foreign States, Citizens or Subjects.
Section 2, Clause 2. Supreme Court, Original and Appellate Jurisdiction
In all Cases affecting Ambassadors, other public Ministers and Consuls, and those in which a
State shall be Party, the supreme Court shall have original Jurisdiction. In all the other Cases
before mentioned, the supreme Court shall have appellate Jurisdiction, both as to Law and
Fact, with such Exceptions, and under such Regulations as the Congress shall make.
Section 2, Clause 3. Criminal Trial by Jury
The Trial of all Crimes, except in Cases of Impeachment, shall be by Jury; and such Trial shall
be held in the State where the said Crimes shall have been committed; but when not committed
within any State, the Trial shall be at such Place or Places as the Congress may by Law have
directed.
STATUTORY BOUNDS OF SUPP. JURIS.
1.
1367 (a) - GEN RULE
1367 - Supplemental jurisdiction ANALYSIS
GENERAL INQUIRY
1. Congress referencing Constitutional limits under Art 3 and recognizing Gibbs case (same
case or controversy - does case arise from common nucleus of fact)
Does non-federal claim arise from "common nucleus of material fact"?
1367 (a) - federal and state claim must be part of the same "case or controversy"
within Art. III
ALWAYS start at subsection (a)
1.
If so, go on => If case solely founded on diversity jur under 1332, then (b) has
certain exc to (a)
Do claims meet 1367(a)?
Considerations - Would you normally try both claims in same proceeding?
Narrow construction based on case law and legislation/ Constitutional
language is too broad
Except as provided by subsection (b)
Wouldn't apply to Gibbs
1.
If bringing in new supplemental claim would be inconsistent with
jurisdictional reqmt under 1332
Is 1367(b) applicable?
1367 (b) - Civil action where courts have original jurisdiction
found solely on 1332 (diversity citizenship)
1.
Something about claim trying ot bring in supplementally, wouldn't
make it in fed ct on its own
1.
MUST know JOINDER RULES
i.
Rule 14. Third-Party Practice
(a) When a Defending Party May Bring in a Third Party.

(1) Timing of the Summons and Complaint.

A defending party may, as third-party plaintiff, serve a summons and
complaint on a nonparty who is or may be liable to it for all or part of
the claim against it. But the third-party plaintiff must, by motion,
obtain the court's leave it if files the third-party complaint more than
14 days after serving its original answer.
(2) Third-Party Defendant's Claims and Defenses.
The person served with the summons and third-party complaintthe
third-party defendant:
(A) must assert any defense against the third-party plaintiff's
claim under Rule 23;
(B) must assert any counterclaim against the third-party
plaintiff under Rule 13(a), and may assert any counterclaim
against the third-party plaintiff under Rule 13(b) or any
crossclaim against another third-party defendant under Rule
13(g);
(C) may assert against the plaintiff any defense that the thirdparty plaintiff has to the plaintiff's claim; and
(D) may also assert against the plaintiff any claim arising out of
the transaction or occurrence that is the subject matter of the
plaintiff's claim against the third-party plaintiff.
(3) Plaintiff's Claims Against a Third-Party Defendant.
The plaintiff may assert against the third-party defendant any claim
arising out of the transaction or occurrence that is the subject matter
of the plaintiff's claim against the third-party plaintiff. The thirdparty defendant must then assert any defense under Rule 12 and any
counterclaim under Rule 13(a), and may assert any counterclaim
under Rule 13(b) or any crossclaim under Rule 13(g).
(4) Motion to Strike, Sever, or Try Separately.
Any party may move to strike the third-party's claim, to sever it, or to
try it separately.
(5) Third-Party Defendant's Claim Against a Nonparty.
A third-party defendant may proceed under this rule against a
nonparty who is or may be liable to the third-party defendant for all
or part of any claim against it.
(6) Third-Party Complaint In Rem.
If it is within the admiralty or maritime jurisdiction, a third-party
complaint may be in rem. In that event, a reference in this rule to the
summons includes the warrant of arrest, and a reference to the
defendant or third-party plaintiff includes, when appropriate, a
person who asserts a right under Supplemental Rule C(6)(a)(i) in the
property arrested.
(b) When a Plaintiff May Bring in a Third Party.
When a counterclaim is asserted against a plaintiff, the plaintiff may
bring in a third party if this rule would allow a defendant to do so.
(c) Admiralty or Maritime Claim.
(1) Scope of Impleader.
If a plaintiff asserts an admiralty or maritime claim under Rule 9(h),
the defendant or a person who asserts a right under Supplemental
Rule C(6)(a)(i) may, as a third-party plaintiff, bring in a third party
defendant who may be wholly or partly liableeither to the plaintiff
or to the third-party plaintifffor remedy over, contribution, or
otherwise on account of the same transaction, occurrence, or series of
transactions or occurrences.
(2) Defending Against a Demand for Judgment for the Plaintiff.

The third-party plaintiff may demand judgment in the plaintiff's favor

against the third-party defendant. In that event, the third-party
defendant must defend under Rule 12 against the plaintiff's claim as
well as the third-party plaintiff's claim; and the action proceeds as if
the plaintiff had sued both the third-party defendant and the thirdparty plaintiff.
1

Rule 19. Required Joinder of Parties

(a) Persons Required to Be Joined if Feasible.
(1) Required Party.
A person who is subject to service of process and whose joinder will
not deprive the court of subject-matter jurisdiction must be joined as
a party if:
(A) in that person's absence, the court cannot accord complete
relief among existing parties; or
(B) that person claims an interest relating to the subject of the
action and is so situated that disposing of the action in the
person's absence may:
(i) as a practical matter impair or impede the person's
ability to protect the interest; or
(ii) leave an existing party subject to a substantial risk of
incurring double, multiple, or otherwise inconsistent
obligations because of the interest.
(2) Joinder by Court Order.
If a person has not been joined as required, the court must order that
the person be made a party. A person who refuses to join as a plaintiff
may be made either a defendant or, in a proper case, an involuntary
plaintiff.
(3) Venue.
If a joined party objects to venue and the joinder would make venue
improper, the court must dismiss that party.
(b) When Joinder Is Not Feasible.
If a person who is required to be joined if feasible cannot be joined,
the court must determine whether, in equity and good conscience, the
action should proceed among the existing parties or should be
dismissed. The factors for the court to consider include:
(1) the extent to which a judgment rendered in the person's absence
might prejudice that person or the existing parties;
(2) the extent to which any prejudice could be lessened or avoided by:
(A) protective provisions in the judgment;
(B) shaping the relief; or
(C) other measures;
(3) whether a judgment rendered in the person's absence would be
adequate; and
(4) whether the plaintiff would have an adequate remedy if the action
were dismissed for nonjoinder.
(c) Pleading the Reasons for Nonjoinder.
When asserting a claim for relief, a party must state:
(1) the name, if known, of any person who is required to be joined if
feasible but is not joined; and
(2) the reasons for not joining that person.
(d) Exception for Class Actions.
This rule is subject to Rule 23.

i.

Rule 20. Permissive Joinder Of Parties

(a) Persons Who May Join or Be Joined

(1) Plaintiffs.
Persons may join in one action as plaintiffs if:
(A) they assert any right to relief jointly, severally, or in the
alternative with respect to or arising out of the same
transaction, occurrence, or series of transactions or
occurrences; and
(B) any question of law or fact common to all plaintiffs will arise
in the action.
(2) Defendants.
Personsas well as a vessel, cargo, or other property subject to
admiralty process in remmay be joined in one action as defendants
if:
(A) any right to relief is asserted against them jointly, severally,
or in the alternative with respect to or arising out of the same
transaction, occurrence, or series of transactions or
occurrences; and
(B) any question of law or fact common to all defendants will
arise in the action.
(3) Extent of Relief.
Neither a plaintiff nor a defendant need be interested in obtaining or
defending against all the relief demanded. The court may grant
judgment to one or more plaintiffs according to their rights, and
against one or more defendants according to their liabilities.
(b) Protective Measures.
The court may issue ordersincluding an order for separate trials
to protect a party against embarrassment, delay, expense, or other
prejudice that arises from including a person against whom the party
asserts no claim and who asserts no claim against the party.
i.

Rule 24. Intervention

(a) Intervention of Right
Upon timely motion, the court must permit anyone to intervene who:
(1) is given an unconditional right to intervene by a federal statute; or
(2) claims an interest relating to the property or transaction which is
the subject of the action, and is so situated that disposing of the action
may as a practical matter impair or impede the movant's ability to
protect its interest, unless the existing parties adequately represent
that interest.
(b) Permissive Intervention
(1) In General.
On timely motion, the court may permit anyone to intervene who:
(A) is given a conditional right to intervene by a federal statute;
or
(B) has a claim or defense that shares with the main action a
common question of law or fact.
(2) By a Government Officer or Agency.
On timely motion, the court may permit a federal or state
governmental officer or agency to intervene if a party's claim or
defense is based on:
(A) a statute or executive order administered by the officer or
agency; or
(B) any regulation, order, requirement, or agreement issued or
made under the statute or executive order.
(3) Delay or Prejudice.

In exercising its discretion, the court must consider whether the

intervention will unduly delay or prejudice the adjudication of the
original parties' rights.
(c) Notice and Pleading Required
A motion to intervene must be served on the parties as provided in
Rule 5. The motion must state the grounds for intervention and be
accompanied by a pleading that sets out the claim or defense for which
intervention is sought.
a.

Even if we do meet (a), made it through (b) w/o getting kicked out, still look
at (c) for various reasons even if would be jur proper, discretionary reasons
ct may decline to exercise suppl jur
Can Ct decline jurisdiction via 1367(c)?
1367 (c) - Gives court discretion to decline jurisdiction
i.
If you don't see anything in facts that implicate one of these
discretionary declines - nothing in facts indicate it would be
appropriate for cts to exercise
i.
If no, done but on exam - continue
Pendent/Ancillary - NONE
Cases - do know as leg history
LEGISLATIVE HISTORY
Fed ct of limited subj matter jurisdiction - litigation complicated
Frequently point of case that would easily have federal jurisdiction over claim (diversity/ fed question)
P has non-federal claim arising out of same transaction/ occurrence that wouldn't stand on its own in
federal court
First TWO cases decided before 1367
Pendent jur

Obsolete by 1367

Ancillary jur

=============>

Supplemental Jurisdiction

United Mine Workers (df) v. Gibbs (PL) 1966 P 888

Gibbs (TN) v. UMW (citizenship of the union based on every member; some from TN)
NO diversity
COA #1
Gibbs sued under Labor Management Relations Act (LMRA) 303 which authorizes
recovery for losses suffered as a result of an unlawful secondary boycott
had caused coal mine to fire Gibbs
COA #2
TN state law claim for tortious interference with a K
STANDARDS FOR PENDANT JURISDICTION
1. all PL claims must arise out of the same nucleus of facts
2. it must "make sense" to exercise jurisdiction, dependent upon:
whether the state law claim predominates;
whether the federal court would have to decide sensitive issues of state law;
whether a jury would be confused by hearing the claims together; and
whether the federal issues may be resolved early, leaving only state claims to be decided.
NOTE: Predecessor to 1367(c)
COMPULSORY COUNTERCLAIM, JOINDER, INTERVENTION OK
Permissive counterclaim NOT OK
Aldinger (PL) v. Howard (df 1) P 891
PL brought action against df and other individual dfs for dismissal from her county job under
42 USC 1983
PL also asserted a state claim against Spokane County (df 2)

 1983 bars federal civil rights claims against counties

Standard for "PENDENT" element 1 is MET
BUT, No statutory grant of jurisdiction over pendent party claim for element 2
Owen Equipment (df) v. Kroger (PL) P 890
PL (IA) sued OK Public Power District (NE) (df) in diversity under 1332
df then impleaded Owen (NE and IA) 3Pd), who was not diverse from either party, under FRCP
14(a)
Extending ancillary jurisdiction to this claim would be inconsistent with requirement of complete
diversity under 1332
Kroger could not have sued OPPD and Owen together originally, so she could not do the
same after Owen was brought in as 3Pd
COMPULSORY COUNTERCLAIM, JOINDER, INTERVENTION, IMPLEADER OK, only with
COMPLETE DIVERSITY
Permissive counterclaim NOT OK
Standard for "PENDENT" element 1 is MET
BUT, No statutory grant of jurisdiction over pendent party claim for element 2
Finley v. US p. 893, n.2
Finley's H killed in plane crash
FTCA - exclusive jurisdiction to federal ct, allowed concurrent jurisdiction
Finley v. FAA + State Ds
(CA)
(CA) state law
FTCA exclusive
SC ended era of judge-made pendant party and ancillary jurisdiction, holding that the absence
of a statutory underpinning was fatal to exercise of jur over claims by P against non-diverse
parties added to litigation
Ct => no federal statute that allows federal ct to exercise jurisdiction over state Ds
1367 (a) - common nucleus => same plane crash
Last sentence meant to allow joinder of different parties
1367 (b) - jurisdiction not based solely on diversity
Would come out different today
Zahn v. Intl Paper
Unnamed class
Class action under diversity statute
MUST be showby P that each unnamed party meets amt in controversy
JOINDER
Under FRCP, is there a rule which will allow joinder?
If yes, is there original jurisdiction over the claim?
If no original jurisdiction, is there supplemental jurisdiction?
P

v.

D1 +

13(a)-(b)
13(g)
Add unrelated claims under 18(a)

D2

v. TPD
14(a)
Mr. X
Rule 19 OR Rule 24
(mtn for
intervention)
Class actions for Rule 23

Exxon Mobil
Case no 1 - Allapath + class (of Exxon deals) v. Exxon

COA - overcharging for fuel scheme

Issue - Allapath meets $ in controversy; other party P don't
Supreme Tribe of Benttur establishes diversity of named class member applies to diversity std
for entire class
Ct allows party members on R. 23 class actions
Case no 2 - Rosario v. Star-Kists
COA - injury
Issue - injured meets $ in controversy; family doesn't
Ct does NOT allow family on R.20 permissive joinder
Majority Analysis
"Original jurisdiction over civil action"
1367(b) strictly read doesn't cut out supplemental jurisdiction in Rosario (only applies to D
joined via R.20)
1367. Supplemental jurisdiction
(a) Except as provided in subsections (b) and (c) or as expressly provided otherwise by Federal
statute, in any civil action of which the district courts have original jurisdiction, the district
courts shall have supplemental jurisdiction over all other claims that are so related to claims in
the action within such original jurisdiction that they form part of the same case or controversy
under Article III of the United States Constitution. Such supplemental jurisdiction shall include
claims that involve the joinder or intervention of additional parties.
GEN RULE
(b) In any civil action of which the district courts have original jurisdiction founded solely
on section 1332 of this title, the district courts shall not have supplemental jurisdiction under
subsection (a) over claims by plaintiffs against persons made parties under Rule 14, 19, 20,
or 24 of the Federal Rules of Civil Procedure, or over claims by persons proposed to be joined
as plaintiffs under Rule 19 of such rules, or seeking to intervene as plaintiffs under Rule 24 of
such rules, when exercising supplemental jurisdiction over such claims would be inconsistent
with the jurisdictional requirements of section 1332.
(c) The district courts may decline to exercise supplemental jurisdiction over a claim under
subsection (a) if-(1) the claim raises a novel or complex issue of State law,
(2) the claim substantially predominates over the claim or claims over which the district
court has original jurisdiction,
(3) the district court has dismissed all claims over which it has original jurisdiction, or
(4) in exceptional circumstances, there are other compelling reasons for declining
jurisdiction.
(d) The period of limitations for any claim asserted under subsection (a), and for any other
claim in the same action that is voluntarily dismissed at the same time as or after the dismissal
of the claim under subsection (a), shall be tolled while the claim is pending and for a period of
30 days after it is dismissed unless State law provides for a longer tolling period.
(e) As used in this section, the term State includes the District of Columbia, the
Commonwealth of Puerto Rico, and any territory or possession of the United States.

CHOICE OF LAW
Whichever court has established its jurisdiction over a cause of action, that court will apply its own
Choice of Law rule.
2-PART PROCESS - after establishing personal jurisdiction then...
A.
CHOICE OF LAW rule (Restatement - place where there is the strongest relationship to
transaction)
Ct always applies its own Choice of Law rules
What is the state's choice of law to choose choice of law rules?
A.
SUBSTANTIVE LAW
THREE LEVELS

CONSTITUTIONAL LIMITATIONS
this standard is less demanding than minimum contacts standard for personal jurisdiction
Likely that a state which has constitutional basis for exercising jurisdiction would generally be
able constitutionally to apply its own law as well if its choice of law analysis points in that
direction (as it usually does)
A.
Choice between different states' governing laws - STD ERIE ANALYSIS
i.
If we have a transaction or some event that involves from ppl from more than one
state, frequent problem of which state's law applies to this dispute
i.
Generally laws of diff state are pretty similar but significant differences
i.
EX - K case
1.
Negotiations in TN, signed in FL
1.
Dispute - ct action in TN/FL - which K law to follow
i
Every state has adopted Choice of Law rule
1.
State the ct is sitting in is always going to apply that state's own choice of
law rule
a.
Forum ct - TN => apply TN choice of law rule
i
2 TYPES OF CHOICE OF LAW RULES A STATE MAY APPLY:
1 Restatement 2d, Conflicts of Laws - MOST POPULAR
calls for application of the law of the state that is most significantly related to the
occurrence and its parties
Factors considered to identify the state that is most significantly related
a) needs of the interstate and international systems,
b) relevant policies of the forum,
c) relevant policies of other interested states and the relative interests in those
states in the determination of the particular issue,
d) protection of justified expectations,
e) basic policies underlying the field of law,
f) certainty, predictability, and uniformity of result, and
g) ease in the determination and application of the law to be applied
NOTE: applies only to matters of substance, not procedure
A
Law of place with the most significant relationship to the transaction is the
rule that applies
A
Reform of Lex Loci
i
TN ct => Rest => TN subst law of K
A
Lex Loci Rule - OUTDATED
calls for the application of the laws of the state where the contract was signed
a.
Law of the place where it happened
a.
Benefit is that it's pretty definite, no gray areas
a.
Drawback - very arbitrary
i.
K - law of place where K was executed whose laws govern transactions
i.
TN => Lex loci => signed in FL => FL law of K applies
a
Federal district ct - 2072
i.
Klaxon Co. v. Stentor Electric Manufacturing Co. 1941 P 945 (notecase)
"The conflict of laws rule to be applied by the federal court in a particular state
must conform to those prevailing in that state's courts."
a court's choice of law rule may have a substantive effect
Courts continue to adhere to Klaxon
a
a

A.

Fed ct sitting in diversity, includes state's choice of law rule

Dist ct in TN will apply TN's choice of law rule (lex loci), same conclusion that fed dist ct
applies FL law of K
Transfer of venue
1404(a)
i. Transferor ct - move to transfer to S.D. Fla - transferee
1. Fed dist ct of TN - transferor case
i
Proper in orig ct to be transferred in transferee ct

P originally filed in place proper procedurally, whatever choice of law rule attached to
transferor ct and transfers with case to transferee ct
1406(a) - assumes that venue in orig ct was improper jurisdictionally or venue-wise
i
Inappropriate ct dose NOT get benefit of having orig ct's choice of law rule move with it
to proper ct
i
FL's chocie of law rule
1. Rest - most sig rel to transaction governs => TN => FL fed dist ct will apply TN's
subst K law to dispute

ERIE DOCTRINE (PP 924-935)

28 USC 1652. State laws as rules of decision
The laws of the several states, except where the Constitution or treaties of the United States or Acts of
Congress otherwise require or provide, shall be regarded as rules of decision in civil actions in the
courts of the United States, in cases where they apply.
Born of the Rules of Decision Act of 1789
The laws of the several states, except where the Constitution or treaties, or statutes of the United
States shall otherwise require 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.
When the fed. court has judicial power to hear the case, even though there is no federal legislative
power to create the governing law:
What law should be applied to this situation?
question addressed in Erie and Swift
Swift (PL) v. Tyson (df) 1842 P 924
FACTS
Plaintiff sued in federal district court in New York to enforce a bill of exchange (a check written
by Tyson to Norton). Defendant argued that the federal court was required to apply prior New
York decisions to the present case. Defendant based his argument on the language behind the
Rules of Decision Act.
Norton owed money to Swift; Norton endorses check to Swift; Swift unable to collect
Tyson argues Swift cannot collect on endorsement of a check from another pre-existing
debt, under NY case law
NY State decisions
pre-existing debt does NOT equal valid consideration
wins
Federal commercial law
pre-existing debt DOES equal valid consideration
wins
TWO possible applicable laws governing transaction:
i
Holder in due course (person accepts instrument w/o knowing defect)
Cannot accept bill of exchange in place of previous debt
Law - cannot collect
i
Gen law - Holder can collect on past bill of collection - current law now
Ct applied "gen common law" => Swift collected on note
SC => state statute - Rules of Decision Act
RULE OF LAW
Federal courts exercising jurisdiction predicated upon the ground of diversity of citizenship
need not, in matters of general jurisprudence, apply the unwritten law of the state as declared
by its highest court. The federal court is free to exercise an independent judgment as to what
the common law of the state is, or should be.
FORUM SHOPPING AS A RESULT OF SWIFT
As a result of the decision in this case, plaintiffs were effectively able to "forum shop" between
state courts and federal district courts within the same state in order to determine which would
be more favorable to their case. This case was overturned by Erie.
allows nonresident plaintiffs of the state where the federal court sits to discriminate against
resident defendants of the forum state.

Story, J
state law (as applied to a diversity of jurisdiction case in federal ct.) =
Statutes of that state + the local construction of those Statutes thereof; and rights and
titles to real estate
e.g. rights and titles to things having a permanent locality
NOT "in the decisions of local tribunals"
a court does not make the law, but merely finds or declares the law
Bastardization of the law applied by Story in Swift
Black & White Taxicab Co. v. Brown & Yellow Taxicab Co.
FACTS
The Brown and Yellow Cab Company, a Kentucky corporation, sought to create a
business association with the Louisville and Nashville Railroad, where Brown and Yellow
would have a monopoly on soliciting passengers of the railroad, effectively eliminating the
competition, the Black and White Cab Co. Black and White sued, and the KY Supr. Ct.
found that such an agreement was illegal under Kentucky common law. Brown and
Yellow dissolved itself, reincorporated in Tennessee, and executed the same exact business
agreement with Louisville there.
HOLDING
The Federal Court upheld the agreement, citing Swift v. Tyson (41 U.S. 1 (1842), and arguing
that under general Federal common law, the agreement was valid.
The Court didn't care whether the agreement would be legal under Kentucky law or
Tennessee law, they only considered whether it would be legal under Federal common
law.
NOTE: If Brown and Yellow had brought suit in a Kentucky State court, then Kentucky
common law would have applied and the agreement would not have been upheld.
If there is no federal law that applies, the state law of the state in which that court sits will
apply.
Erie Railroad Co. (df) v. Tompkins (PL) 1938 P 925
Tompkins (PA) v. Erie (NY)
COA
negligence
FACTS
Harry J. Tompkins (Plaintiff), a citizen of Pennsylvania, was injured while walking on a wellworn footpath that runs along the railroad tracks. A train operated by the Erie Railroad
Company (Defendant) was passing along the railroad tracks, when an open door on the train hit
Plaintiff and injured him. Defendant is a New York company. If Plaintiff had filed a negligence
action in Pennsylvania, he probably would have lost because, under PA law, as declared by its
highest court (according to df), he was a trespasser and, as a result, the Defendant would have
been liable only for gross, as opposed to ordinary negligence. However, Plaintiff filed his suit in
the Southern New York federal court. PL contends there is no statute of the state (PA) on the
subject. By filing in federal district court, Plaintiff hoped that the court would follow the prior
decision in Swift v. Tyson, ignoring the state common law and requiring him to establish
ordinary negligence, as opposed to gross negligence by the Defendant. The district court applied
"general law" and awarded Plaintiff $30,000.00 in damages. The court of appeals affirmed this
decision on the same grounds. Supr. Ct. majority reverses and remands.
PA state decisions
RR not liable to trespassers unless its negligence is wanton and willful
Federal general common law
RR liable to licensee for negligence
General Law held to include (as defined by Brandeis, J):
obligations under Ks entered into and to be performed within the state
liability for torts committed within the state upon residents or property located there
the right to exemplary punitive damages
ISSUE

Whether the law of the state, declared by its Legislature in a statute or by its highest court in a
decision, is a matter of federal concern.
RULE OF LAW
A federal court, in the exercise of its diversity jurisdiction, is required to apply the substantive
law of the state in which it is sitting, including that state's conflict of law rules. However, the
federal courts should apply federal procedural law in diversity cases.
HOLDING
The Court concluded that the application of the rule in Swift had invaded rights, which were
specifically reserved for the states by the United States Constitution. The effect of the decision
in Erie is to require federal courts to apply state law on substantive issues, which includes
judge-made common law as well as state statutes. As a result, Pennsylvania law must be
followed in this case, which required that Defendant refrain from willful or wanton injury. This
case was remanded to PA fed. ct., applying PA state law, for further proceedings in conformance
with this opinion.
Unconstitutionality in Swift declared by Brandeis
decision authorized judges to make the law in areas in which the federal govt. has no delegated
powers.
because no applicable Constitutional or Legislative law had been made yet
According to Story, J, judges should merely declare the law.
Butler, J and Reed, J base their dissents on this unconstitutionality decree.
state that judges making the law is merely erroneous; NOT unconstitutional
Reasons to overturn Swift
statutory
constitutionality
policy reasons
RESULT OF ERIE
Positivism in the Law
judges ability to create law with the legislature and the Constitution
instead of Natural Law
law created by Constitution and legislature alone
ERIE AND THE PROCEDURAL LAW OF THE STATE
NOTE: (1938) - FRCP promulgated; Erie decided
Guaranty Trust Co. (df/pet) v. York (PL/resp) 1945 P 935
COA
breach of fiduciary duty
claim in equity; not common law (Cf. 7th Amendment)
THUS, Erie applies in equity cases
FACTS
In May 1930, Guaranty Trust Company (Petitioner) was named as trustee for some of the
noteholders of the Van Sweringen Corporation (Van Sweringen). In October 1930,
Petitioner loaned to corporations affiliated with Van Sweringen. When Van Sweingen
began having financial problems, Petitioner agreed to purchase notes for 50% of face
value of the note ($500) and twenty shares of Van Sweringen stock for each $1000.00 note.
Offer remained open until 12/15/1931. In 1934, York (Respondent) received as a gift
$6000.00 worth of the notes from a donor who had not accepted Petitioner's offer. In
April 1940, three accepting noteholders brought a diversity suit alleging that Petitioner
had breached its fiduciary duties, allegeing fraud and misrepresentation. Respondent's
application to intervene in this suit was denied, and summary judgment affirmed for
petitioner. Hackner v. Morgan. After respondent's dismissal from Hackner, she began
present proceedings on 1/22/1942. Petitioner filed a Motion for Summary Judgment in the
district court, due to the fact, that the New York statute of limitations had run. The
district court granted this motion upon authority of Hackner. The United States Court of
Appeals for the Second Circuit reversed this decision when it held that in a suit brought
in equity in federal district court, that court could apply laches doctrine (did not have to
follow the New York statute of limitations even though jurisdiction was based on

diversity, if it was unreasonable and prejudicial to the defendant). The Supreme Court of
the United States reversed and remanded
York v. Guaranty Trust Co. 1942 borne out of:
Hackner v. Morgan 1940
COA = fraud
Due Process Clause:
York tried to intervene under FRCP 24 in Hackner suit = denied
York had right to bring suit after being denied intervention and judgment in
Hackner
York brought suit as a Class Action under FRCP 23
NY State law
NY SOL = 5 years
Federal law
laches doctrine
did not have to follow the New York SOL, even though jurisdiction was based on diversity, if
it was unreasonable and prejudicial to the defendant
RULE OF LAW
When there is diversity jurisdiction, the federal court should use the outcomedeterminative test to ensure that the outcome of the federal court's application of law
would not be different than the outcome if the state had tried the case. In this case, the
federal court sitting with diversity jurisdiction must follow a state statute of limitations.
"Outcome-determinative" Test
The outcome of the litigation in the federal court should be substantially the same as it
would be if tried in the state court.
To be followed in cases involving diversity jurisdiction
Results of the Test
A party should not be able to manipulate the state and federal court systems solely
to bring a claim in federal court that would, otherwise, be defeated by a statute of
limitations if brought in state court.
This test is designed to prevent forum shopping between federal and state courts.
The state's interest in controlling the outcome is very important as it seeks to
protect its citizens.
Alternatively, the federal interest is relatively weak, and there is very little to be
gained from uniformity between federal districts.
Substantive vs. Procedural Standard in majority of cases today
SUBSTANTIVE LAW PRINCIPLE
Erie (1938)
Rules of Decision Act 1652
PROCEDURAL LAW PRINCIPLE
FRCP (1938)
Rules of Enabling Act 2072
NOTE: Frankfurter, J did not support this delineation to his opinion in York
RATIONALES FOR ERIE
1. statutory interpretation of 1652 (RDA) - Swift
2. constitutional (federalist) issue of court's ability to make or decide law - Erie
3. forum shopping/ inequity - York
outcome of a litigation should be substantially the same in federal ct as if tried in State ct.
Cf. 3 note cases that applied York decision P 941
FRCP STRIKES BACK
28 U.S.C. 2072. Rules of procedure and evidence; power to prescribe
(a) The Supreme Court shall have the power to prescribe general rules of practice and
procedure and rules of evidence for cases in the United States district courts (including
proceedings before magistrate judges thereof) and courts of appeals.
(b) Such rules shall not abridge, enlarge or modify any substantive right. All laws in conflict
with such rules shall be of no further force or effect after such rules have taken effect.

(c) Such rules may define when a ruling of a district court is final for the purposes of appeal
under section 1291 of this title.
Byrd v. Blue Ridge Rural Electric Cooperative, Inc. 1958 P 947
FACTS
Byrd (Petitioner), a resident of North Carolina, filed a diversity suit in the District Court
for the Western District of South Carolina for injuries allegedly caused by the negligence
of Blue Ridge Rural Electric Cooperative, Inc.'s (Respondent), a South Carolina
corporation. Petitioner was a lineman in a construction crew of a contractor who had
contracted to build power lines for the Respondent. Petitioner was injured while
connecting power lines during the course of his employment. The Respondent offered, as
an affirmative defense, that the Plaintiff had the status of a statutory employee under the
South Carolina Workmen's Compensation Act (Act). Therefore, he was barred from
suing Respondent at law, so he had to settle for statutory compensation benefits as the
sole remedy.
At trial, the jury returned a verdict for Petitioner. However, the United States Court of
Appeals for the Fourth Circuit reversed, and directed judgment for the Respondent.
Respondent urged the Supreme Court of the United States to follow the decision rendered
by the Supreme Court of South Carolina in Adams v. Davison-Paxon Co., when the court
found that it was for the judge, not the jury to decide whether a business owner was a
statutory employer. Supreme Court of the United States reversed the decision of the court
of appeals and remanded for further proceedings consistent with its opinion.
ISSUE
Whether the "outcome-determinative test" as established by the court in Guaranty Trust
Co. should apply to the decision of whether to try an issue before a judge or a jury?
HOLDING
The likelihood of a different result is not so strong as to require the federal court practice
of jury determination of disputed factual issues to yield to the state rule in the interest of
uniformity of outcome
RULE
There are varying degrees of the Guaranty Trust Co. "outcome-determinative test." The
fact that the decision of which law, federal or state, to apply will should be outcomedeterminative is not conclusive.
Test established by this court to determine issue before a JUDGE or a JURY
Whether the state rule (case) is bound with the rights of the State Statute that its
application in Federal Court is required.
Whether the litigation would come out differently in Fed. and State Cts, if the Fed. Ct.
failed to apply a particular rule.
(Fed.) - Jury decides if an employee
(State) - no jury/judge decides if an employee under workers comp.
Whether the issue of immunity is decided by a judge or a jury.
Whether the Fed. interest asserted is more or less important than the interest in
preserving uniformity of result with the State Ct.
Applying ERIE's balance between the State and Federal interests.
(1) States - not having its policies undermined in diversity cases.
(2) Federal Cts - administering justice in accord with the Federal principal.
(3) Federalism (Federal interest) - not having the outcome of the case turn exclusively on
the forum in which the case was brought.
THE BYRD CHART
State law bound with substantive rights
/\
/\
YES _by mere form or mode _ (procedure)
||
apply Is it outcome determinative? (York case)
state law. / \

YES NO
||
are there then apply Fed. Law.
countervailing
Fed. considerations?
Hanna (PL/pet) v. Plumer (df/resp) 1965 P 953
FACTS
Hanna (Petitioner), a citizen of Ohio, filed a complaint in District Court for the District of
Massachusetts, claiming damages in excess of $10,000 for injuries resulting from an auto
accident in South Carolina, allegedly caused by the negligence of Louise Plumer Osgood,
a resident of Massachusetts, and deceased at time of filing. Husband/executor was named
Respondent On February 8, 1963, service was made by leaving copies of the summons
and complaint with Respondent's wife at his residence in compliance with Rule 4(d)(1) of
the Federal Rules of Civil Procedure. Respondent answered on February 28, 1963,
alleging that an action could not be maintained because it was brought in violation of
Massachusetts General Laws Chapter 197, Section 9. The district court granted
Respondent's Motion for Summary Judgment and the United States Court of Appeals for
the First Circuit affirmed.
The Supreme Court of the United States reversed the decision of the court of appeals.
ISSUE
Whether, in a civil action when the jurisdiction of the district court is based upon
diversity of citizenship between the parties, the Rules Enabling Act (28 USC 2072)
allows service of process to be made in the manner prescribed by state law or that set
forth in Rule 4(d)(1) of the Federal Rules of Civil Procedure?
ANALYSIS
Federal rule
FRCP 4(e)(2)
various delivery methods, including but not limited to personal service
State law
Personal service on df within 1 year SOL
Is there a FRCP that governs this situation?
/\
YES NO
FRCP 4(e)(2) Rules of Decision Act ( _RDA _) 28 U.S.C. 1652 [aka: "True" Erie
analysis]
I|
28 USC 2072 Outcome determinative? (York)
| - Forum shopping
(1) Is the rule w/in REA? YES - Inequitable Administration
(2) Does 2072(b) abridge, enlarge * when the PL is deciding whether to file in State or Fed
Ct.
or modify a State substantive right? NO * non-substantial, trivial variations.
(3) Does the rule transgress other
constitutional bounds?
If (1) YES, but if (2) NO; then apply Fed. Rule.
RULE
In a diversity action, federal courts are to determine adequacy of service under Rule 4(d)
(1) of the Federal Rules of Civil Procedure.
HOLDING
The Court stated that Rule 4(d)(1) was designed to govern service of process in diversity
actions. In addition, Rule 4(d)(1) is in harmony with the Rules Enabling Act, since it is
largely procedural in nature.
Further, Rule 4(d)(1) applies to the matter before the court because it specifies the
allowable method of service in a federal matter. As a result, the rule shall take precedence
over any divergent state statute or rule, even if application of the rule will produce a
different outcome than had the state rule been followed in the first instance.

Hanna - Does federal rule answer question in dispute?

NO - Ginsburg

YES - Scalia - DISSENT

1652 - Rules of Decision Act

2072 - Rules Enabling Act

No federal rule that answers question in dispute, no conflict

59 is not specific enough to govern

Interpret FRCP w/ sensitivity to important

state interest
Reflection of fear of jury verdicts are unreasonably
high
NY purpose (substantive) to limit P's recovery
=> Changes name to Outcome-Affective Test
Twin aims of Erie - to prevent:
1.
Forum shopping
Difference in federal and state law => rather go
to federal court
1.
Inequitable administration of law

Procedural - R. 59 controls
Doesn't even reach Erie question
2 conflicting standards
Scalia - not every ct uses "shocks the conscious standard" - not
much of a diff b/t stds

1st issue - Did 7th Amendment make it unconstitutional for AC to review?

7th Amendment, 2 - Re-Examination Clause
AC can review TC's denial of mtn but has to apply fed std => "abuse of discretion"
Trying to avoid forum shopping
Makes difference if it had to go up onto appeal
Burlington Northern Railroad Co. v. Woods notecase P. 968
Fed. rule
Fed. R. App. P. 38
awards just damages and single or double costs if appeal was frivolous
State law
Ala. mandatory affirmance penalty
awards 10% of amount of judgment ($300K) if appeal was frivolous
Conflict?
Supr. Ct. holds that Fed rule allows for possibility of less than 10% penalty; whereas Ala.
state law does not
THUS, the Fed. Rule controls.
Walker v. Armco Steel Corp. notecase P. 974
Fed. rule
FRCP 3 (SOL tolled upon filing complaint)
State law
SOL tolled upon service of process upon defendant
ANALYSIS
Is there a FRCP that covers this situation? (Hanna Analysis)
/\
YES NO
FRCP 3 Rules of Decision Act ( _RDA _) 28 U.S.C. 1652 [aka: "True" Erie analysis]
I|
28 USC 2072 Outcome determinative? (York) YES (see (3) in YES column)
| - Forum shopping
(1) Is the rule w/in REA? YES - Inequitable Administration
(2) Does 2072(b) abridge, enlarge * when the PL is deciding whether to file in State or Fed Ct.

or modify a State substantive right? YES * non-substantial, trivial variations.

(3) Does the rule transgress other
constitutional bounds? YES. (Supr. Ct. holds FRCP 3 governs timing requirements, but does not affect
state SOLs)
If (1) YES, and if (2) YES; then GO TO NO and apply State law
Stewart Organization, Inc. v. Ricoh Corp. notecase P. 966
Fed. rule
28 U.S.C. 1404(a). Change of Venue.
For the convenience of parties and witnesses, in the interest of justice, a district court may
transfer any civil action to any other district or division where it might have been brought.
State law
unfavorable towards Forum selection clause
ANALYSIS
Is the statute sufficiently broad to control the issue before the court?
1404(a) is sufficiently broad to control.
The statute covers if the ct. finds the statute represents a "valid exercise of Congress'
authority under the Constitution."
THE PENDULUM SWINGS (A LITTLE)
Gasperini (PL) v. Center for Humanities, Inc. (df) 1996 P 977
FACTS
William Gasperini (Petitioner), a journalist for CBS News and the Christian
Science Monitor, reported events within Central America during a seven year
period from 1984 through 1990. During this time, Petitioner took over five
thousand slide transparencies of war zones, political leaders and daily life in
Central America. In 1990, Petitioner agreed to supply his original transparencies to
the Center for Humanities, Inc. (Respondent), for use in an educational video
entitled "Conflict in Central America." Petitioner selected three hundred
transparencies for use in making the video. However, despite the fact that the
Respondent agreed to return the transparencies, when the project was complete,
the transparencies could not be located.
New York state law provides that appellate courts are empowered to review the size
of jury verdicts and to order new trials when the jury's award deviates materially
from what would be reasonable compensation. Alternatively, the Seventh
Amendment provides that the right of trial by jury shall be preserved, and no fact
tried by a jury, shall otherwise be re-examined in any court of the United States
Petitioner filed suit in the United States District Court for the Southern District of
New York, under diversity jurisdiction, alleging several state-law claims for relief,
including breach of contract, conversion and negligence. After trial, the jury
awarded Petitioner, $450,000. The Respondent moved for a new trial, in part on the
grounds of excessiveness in the jury award. The United States Court of Appeals for
the Second Circuit vacated the jury award and ordered a new trial, unless
Petitoner agreed to an award of $100,000.
ISSUE
Whether New York state law regarding reasonable compensation can be given
effect without detriment to the Seventh Amendment, in an action based on New
York law, tried in federal court under diversity of citizenship jurisdiction.
YES
RULE
Just as the Erie principle precludes a federal court from giving a state-created
claim longer life than the claim would have had in state court, so too does Erie
preclude recovery in federal court, which is significantly larger than the recovery
that would have been allowed in state court.
ANALYSIS
, seeking compensatory damages, was awarded $450K at trial by the jury

 did not deny liability; moved for new trial, due to a verdict for excessive damages
(Cf. Remittitur), under FRCP 59.
Federal standard
Whether damages awarded by the jury would "shock the conscience" of the
court
NY state standard
Whether damages awarded by the jury "deviate materially" from what is
considered "reasonable compensation"
more stringent than federal standard = easier for to get remittitur
THEREFORE, does an FRCP apply/ govern/ or conflict directly with state law?
Ginsberg, J. (MAJORITY)
There is NO substantive standard in FRCP 59.
THUS, the court should use the standard set by the state on a
procedural issue.
Scalia, J. (DISSENT)
If there is a consistent federal interpretation of the state law, and Congress
has not amended it, then it is presumed that Congress agrees to the standard
set by the federal courts.
THUS, the federal standard of "shock the conscience" is implicit in
FRCP 59.
DOES AN FRCP APPLY/ GOVERN/ CONFLICT DIRECTLY WITH STATE
LAW?
/\
YES NO
Rules Enabling Act (REA) 2072(b) Rules of Decision Act (RDA) 1652 [aka: "True" Erie
analysis]
(Scalia dissent) (Ginsberg Majority)
1) Is the Rule w/in REA? "OUTCOME- AFFECTIVE"
2) Does 2072(b) abridge, enlarge - without this test, a non-resident would choose Federal court
or modify a State substantive right? - prevents discrimination of in-state citizens by nonresidents by forum shopping
3) Does the Rule transgress other - same as "outcome determinative," but under a different name
now
Constitutional bounds? - (Byrd, Erie, and York analysis)
NOTE: Supr. Ct. MAJORITY'S VIEW of preventing "abuse of discretion" by the
Appellate Court:
Appellate Court CANNOT review the standard set by Trial court's application of state
law
Procedural Progression
Federal District Court
in reviewing the jury's verdict, the court MUST apply the state
statutory standard if the FRCP conflicts directly with it
In this case:
application of NY statutory standard creates award of damages
that "deviate materially" from the FRCP broad standard
Federal Appellate Court
CANNOT review the jury verdict at trial, UNLESS
There has been an "abuse of discretion" by the trial court
What the hell is THE POINT?
The outcome determinative test is still applied, but it's just called "outcome affective"
now
Shady Grove Orthopedic Assoc. (PL/pet) v. Allstate Insurance Co. (df/resp) 2010 TWEN
ISSUE
Does the Federal Rule at issue answer the question before the court?

NOTE: Overriding issue in any Erie case

28 U.S.C. 1332. Diversity of citizenship; amount in controversy; costs
(d)(2) The district courts shall have original jurisdiction of any civil action in
which the matter in controversy exceeds the sum or value of $5,000,000,
exclusive of interest and costs, and is a class action in which-(A) any member of a class of plaintiffs is a citizen of a State different
from any defendant;
(B) any member of a class of plaintiffs is a foreign state or a citizen or
subject of a foreign state and any defendant is a citizen of a State; or
(C) any member of a class of plaintiffs is a citizen of a State and any
defendant is a foreign state or a citizen or subject of a foreign state.
1332 allows:
a class action if there is MINIMUM DIVERSITY, and AIC of more
than $5M
to remove a class action to Federal Ct.
CONFLICT
State law
N.Y. Civ. Prac. Law 901(b)
precludes a suit that seeks to recover a "penalty" from proceeding as a class
action
Federal Rule
FRCP 23. Class Actions.
defines the scope of class actions; BUT is it substantive?
ANALYSIS
Trial and Appellate Courts
applied 901(b):
by not allowing case to proceed as a Class Action, PL claim had an AIC of
about $500 (less than $5M required AIC)
Supreme Court
5-4 MAJORITY:
allowed claim to proceed as a class action AND reaffirmed outcome-affective
analysis in Gasperini (though not applicable here)
SPLIT b/w MAJORITY & DISSENT; Whether the FRCP answers the question
before the court?
aka: Is the Fed Rule sufficiently broad to control the issue, thereby leaving NO ROOM for
appllication of state law?
/\
YES NO
Rules Enabling Act (REA) 2072(a) Rules of Decision Act (RDA) 1652 [aka: "True" Erie
analysis]
(Scalia, Stevens, Majority) (Ginsberg dissent)
He collapses issue down to 2072(a) "OUTCOME- AFFECTIVE"
- Whether the Fed. Rule:
- without this test, a non-resident would choose Federal court
"REALLY REGULATES PROCEDURE
- prevents discr. of in-state citizens by nonresidents by forum shopping
Scalia basically ignores effect of 2072(b) - (Byrd, Erie, and York analysis)
What the hell is THE POINT?
Same decision reached by Scalia's Majority and Stevens' concurrence.
Scalia just had to apply his convoluted, clusterfuck analysis... fuck Scalia.
IN EXAM ANALYSIS, MUST APPLY BOTH the 2072(a) ANALYSIS (HANNA)
AND 2072(b) ANALYSIS (SHADY GROVE) underYES
NUTSHELL
If YES:
2072 analysis
Hanna/ Shady Grove = Federal Rule (FRCP) will trump state law.
if NO:

 1652 ("True" Erie) analysis

Byrd, Erie, and York = prevent FORUM-SHOPPING through OUTCOMEAFFECTIVE analysis
Progression of case law answering whether FRCP is sufficiently broad to control the issue
Shady Grove - Does FRCP answer Q in dispute?
NO - Ginsburg (3 Justices)
Asks is federal rule
Outcome-Affective
If P asked to choose, which would be
chosen?
Obviously fed ct bc it cannot be brought
into state court

State law applies

o
Looked at legislative
history - NY trying to reduce class
action suits
o
Rule 23 narrowly
interpreted w/ sensitivity to state's
attempt to reduce class actions

YES - Scalia (5 Justices)

Rule 23 governs
Sets criteria => certification
No room for 901(b) as a precondition
Cohen case - 23.1
Stockholder derivative suit
Doesn't mention that bond must be posted
NJ - stat - P to post
To prevent one stockholder to hold cor
hostage
Forum shopping would result
"Maintains" => option of P
Rule 23 govern

Stevens thinks should

be separate questions
Still room for
application of
2072(b)

4 Justices - only Plurality

<=Stevens drops out
Does it comply w/ REA 2072?
(a),(b) - both answered by Sibbach
Scalia's dissent loses Stevens
If "really regulates procedure" => w/in REA
Fast track to apply federal rule

Identify federal rule that should be applied

Fed "rule"
If fed rule within federal Constitution - always trumps
Levels of hierarchy:
o
Fed Const > state
o
Fed state passed directly by Congress > state
Same type of question begins analysis
If statute related to something procedural => Necessary and Proper clause
1.
Fed rule (i.e. FRCP/FRAP/FRBP) w/in delegation of authority of federal cts from
Constitution promulgated into FRCP
Yes - w/in 2072 => Constitutional
1.
Federal practice, custom, not embodied in a rule/statute
"True Erie" practice
i.e. York - custom of fed ct to apply Laches
i.e. Byrd case - general preference for factual questions to be answered by
jury => fed practice
Fed ct operates on calendar system
Once we decide fed ct will apply state law
Issue - What is that law? (not crystal clear)
Does Federal law answer Q?

NO

YES

Gasperini - FRCP 59

Shady Grove - FRCP 23

Ragan - FRCP 3

Hanna - FRCP 4(e)(2), now 4(d)

Cohen - FRCP 23.1 (then 23)

Sibbach - FRCP 35

Erie - no fed C/L for torts

Stewart - 28 USC 1404(a)

York - only fed "rule" was an equitable doctrine of

laches

Burlington-Northern - FRAP 38

Byrd - only fed "rule" was practice of preferring juries

to decide disputed fact issues

ANALYSIS IN AN ERIE CASE

1. Fed district ct - usually almost always diversity
FQ - 1. Fed statute
2. Supplemental jurisdiction - state law count
Case otherwise governed by state law, you're going to not both
1.
State law - oddball that doesn't apply but someone pops up and tries to apply it
1.
Fed law
Competing state and federal rules that aren't clearly substantive and clearly procedural
Clearly subst => Erie
Clearly proc => FRCP
Ragan p.937
St rule - process served to stop S/L from running
P brought suit in time but didn't effectuate service on D in time before S/L ran
P - FRCP Rule 4 governed, providing civil case initiated and caused S/L to stop running
D - state law
FRCP - Rule 3 - commence at filing of ct
SC => Fed ct must go w/ state rule
Rule 3 doesn't cover issue, it's a housekeeping rule, doesn't mention S/L => 1652
Rule 3 didn't apply - mechanical hwo to start an action
Person who wants st ct wins
Woods v. Interstate Realty
St - door closing statute - corp not registered to do business in state then don't have opportunity
to bring case into fed ct
Fed - no such thing, anyone can sue
=> different outcome => st rule applies
Cohen v. Beneficial Life Case
Cohen - stockholder
Derviative action in NJ - like Shaffer v. Heitner
If you own one share, can file action
NJ - statutorily, shareholder who owns less than certain # of shares must post bond to bring
derivative action
Fed - Rule 23.1 - reqmts but doesn't req bond
TEST
St => dism'd w/o bond

Fed => Ok
Different outcome => State law applies
Does FRCP cover this situation?
NO

YES

1652 - Rules of Decision Act

2072 - Rules Enabling Act

Erie => RDA

Didn't use bc FRCP didn't exist yet
Erie & York - Laches v. State C/L

Outcome Determinative Test - Guaranty Trust v. York

1 Does rule in question fall within 2072?
1.
Evaluate in terms of twin aims of Erie
(Is REA sufficiently broad enough to include?
1.
Discouraging forum shopping
SC go beyond its authority?)
1.
Avoiding inequitable
Decides if rule falls within REA - whether it really
administration of law
regulates procedure
If we apply fed rule instead of st law, would it
Sibbach - "really regulates procedure"
substantially affect outcome of the case?
The test must be whether a rule really regulate
1
Focusing on substantial variation in federal and state
procedure,-the judicial process for enforcing r
law
and duties recognized by substantive law and
1
Ct says let's look at choice of fed and state law ex ante
justly administering remedy and redress for
(before it subsides), not ex poste (not after it has had
disregard or infraction of them.
its delegatory effect)
Would lack of fed law discriminate against
1 Is rule in question constitutional?
party?
Falls within Necessary and Proper clause
Byrd - countervailing federal consideration
FRCP never held to be outside of REA
Prefer question of fact tried by jury

Is there a federal statute or FRCP/FRAP, etc. that answers the question in dispute (i.e. conflicts) with
state law such that both the fed and state law cannot be applied?
NO 1652

=> stronger argument

YES 2072

8(a)(3) too broad to govern

8(a)(3)

8(a)(3) - you only state demand for relie

"True Erie problem"

15(a)

PA stat - here's how you state demand fo

Still allows punitive but is directing
Seemingly addressed to pleading

Outcome-Affective/ Determinative
If fed ct were to apply fed rule instead of state,
would P be more likely to choose fed ct over st
ct bc outcome would be different?
Twin aims of Erie to prevent:
1. Forum shopping
2. Inequitable administration of
the law

26(b)(1)
Is 8(a)(3) within delegation of REA 20
But doesn't really answer problem
Does it "really regulate procedure"? Y
Clearly procedural => pleading

If person w/ diversity of citizenship would they

be unfairly discriminated bc they couldn't
purposefully avail themselves to jurisdiction?

May be more than one fed rule

that conflicts

Constitutional Test - Was rule w/in

Congressional auth?
Is rule rationally capable of being cl
as procedural? Yes.

If fed ct were to apply 8(a)(3) v. tort reform

statute, would P be more likely to choose fed
over state bc outcome would be different? YES
- less work

2072 is valid and can be applied

=> conflicting state law trumped by fed
=> apply 8(a)(3)

=> Byrd - affirmative countervailing federal

interest (some int that trumps OutcomeDeterminative test)
1
Gasperini - concern about federal
division of authority b/t fed district ct
and Appellate level reviewing ability
1
Division b/t judge and jury
1
Fed civil procedure should be applied
uniformly governing fed ct - basically
REJ'D bc proves too much
Would it really change the outcome?
No - you'll have the evidence eventually
Yes - punitive $ puts more weight to
settle

PRECLUSIVE EFFECTS ON JUDGMENT

Preclusive Effects of Judgment
COLLATERAL ESTOPPEL (Issue Preclusion)
prohibits re-litigation of issues already decided in previous litigation
backup to res judicata
use when the claims are different, but the issues are the same
RES JUDICATA (Claim Preclusion)
prohibits re-litigation of a claim already decided in previous litigation
Merger
if PL wins: claim is said to be merged into the judgment
claim is extinguished and replaced by judgment
Bar
if df wins: PL claim is barred by the adverse judgment
no further suit can be brought on that claim
PRECLUSIVE EFFECTS OF JUDGMENT (MERGER AND BAR) APPLY ONLY WHEN:
1. The second claim is based on the same claim or cause of action, AND
2. Parties to the suit are the same, or are in privity, AND
3. Determination of the first action is a final, valid judgment "on the merits"
RECURRING SITUATIONS
1
Installment K
1
Child custody - divorce
Dad => mtn to modify custody
Not barred by RJ bc claim not from the same transaction
New facts after divorce - not same claim
Child custody ALWAYS subject to modification
1
Taxes - each year for tax returns is a separate transaction for res judicata
1

CLAIM PRECLUSION/ RES JUDICATA - go through first then issue preclusion

1.
Elements in Restatement
1.
ELEMENTS

Usually applies to P
Can happen with respect to D
Merger - if P wins, can't come back and sue for more things under same claim
1
Two cases involving the same "claim" - 24
Transactional Test
Don't want to split COA - modern trend: bring any and every theory
in the same action
Operates as monolithic stone wall
Reqmt met => precludes you from claim you brought and also
any theory you could've brought but didn't think so
Rules are liberal but once there is a judgment and time for appeal has
passed, finality of the judgment and conservation and resources come
into play
Don't want to countenance equitable exceptions bc it would undercut
res judicata
Manego (PL) v. Orleans Board of Trade (df) 1985 P 1097
FACTS
In late 1978 and early 1979, Manego (Plaintiff) applied to the
Orleans Board of Selectmen for entertainment and liquor
licenses for a disco, which he wanted to build on a vacant lot.
The lot was located in a commercial district a few hundred feet
from an ice skating rink that was owned by Cape Cod Five
Cents Savings Bank (Bank). The Bank opposed Plaintiff's
application and, eventually, the Orleans Board of Selectmen
denied Plaintiff's applications for both the liquor and
amusement licenses. The Bank had plans of its own to offer live
music, roller-skating, and dancing at the rink.
Plaintiff brought a lawsuit in federal district court naming the
Board of Selectmen, the Bank and David Willard (Willard), the
vice president of the bank as Defendants, claiming they had
conspired to deny him entertainment and liquor licenses
because of his race. The district court dismissed the state law
claims for failure to state a cause of action and granted the
Defendants' Motion for Summary Judgment as to the remaining
claims.
Plaintiff then brought another lawsuit, this time against the
Bank, Willard and the Orleans Board of Trade alleged antitrust
violations under the Sherman Antitrust Act. Willard and the
Bank moved for summary judgment on the grounds that the
new claims were barred by the doctrine of res judicata.
The district court held that the facts forming Plaintiff's claim of
antitrust violations were the same as those which formed the
basis of his earlier civil rights claims and that they were,
therefore, barred by the final judgment against Plaintiff on the
civil rights claims.
RULE
Under the doctrine of res judicata, a final judgment on the
merits of an action precludes the parties or their privies from
relitigating issues that were or could have been raised in that
action. This bar is limited, however, to cases arising out of the
same cause of action or claim.
ISSUE
Is Plaintiff barred from bringing a second lawsuit involving
some of the defendants in a prior action, when the claims are

based upon the same facts as those that formed the basis for the
first suit?
HOLDING
Yes. Since each alleged conspiracy had the same practical end,
keeping Plaintiff from operating the disco, and each used
essentially the same means, denial of the licenses, the difference
in motive for the conspiracy did not create separate
transactions. As a result, Plaintiff's antitrust claim is barred by
res judicata as to the Bank and Willard
ANALYSIS
Suit #1
s Claim Court Result
Manego Bd. of Selectman/Willard/Bank racial discrim. Fed. Dist. Ct. granted
summ judg due to s lack of evidence
" " " Fed. App. Ct. affirmed
Suit #2
s Claim Court Result
Manego Bd. of Trade/Willard/Bank violated Sherman Anti-Trust Fed. Dist. Ct.
granted SJ due to res judicata (transactional)
" " " Fed App. Ct. affirmed
The court adopted a transactional definition of the underlying
claim or cause of action.
same evidence was used by the PL in both claims
Choice of law issues can arise when in state court
Separate claim if violation was of a separate right
State's choice of law has its own res judicata
Federal ct follows Restatement => 18-19

Suit
1

P(s)

D(s)

Court

Claim(s)
brought

Manego

Selectman
Bank
Willard

Fed

Racial discr
under 1981

Manego

Bank
Willard
Trade (claim
against each D is
separate)

Fed

Sherman Act
Can join
claims under
18(a)

Parties to two suits are the same or in "privity" w/ a party from the former
suit
1.
If parties not same or in privity, NOT claim preclusion => issue
preclusion
1.
Rule 17(a). Real Party in Interest
(1) Designation in General.
An action must be prosecuted in the name of the real party in interest.
The following may sue in their own names without joining the person
for whose benefit the action is brought:
(A) an executor;
(B) an administrator;

Issue(s) [for issue

preclusion]

(C) a guardian;
(D) a bailee;
(E) a trustee of an express trust;
(F) a party with whom or in whose name a contract has been
made for another's benefit; and
(G) a party authorized by statute.
Martino v. McDonald => 22
Suit
1
1

P(s)

D(s)

Court

Claim(s) brought

McD

Martino

Fed

Breach of
franchise agrmt

Martino

McD

Fed

Anti-competitive
of franchise agrmt
violates anti-trust
law

Issue(s) [for is
preclusion]

<= Sherman A

Consent judgment - b4 Martino answered, parties entered into consent

judgment giving McD the right to take over
W/ ct's blessing of settlement agrmt
If violates, will be held in contempt of court order
Compulsory counterclaim - 22
Should've brought claim in 1st case
13(a) didn't apply
13(a)(1) - if D goes and files answer
Martino never filed an answer => settled
22(2)(b) - ct blessed judgment that D violated agrmt
2nd suit would nullify 1st judgment
HYPO
Suit
1

P(s)

D(s)

Court

Claim(s)
brought

McD

Martino

State

Breach of
franchise
agrmt

Martino

McD

Fed

Personal injury
to Martino by
Mcd's thugs

If state had no compulsory counterclaim rule, as long as state court

followed C/L idea - nullifying rights on 1st action
II - no compulsory counterclaim
Will rights in 1st suit be impaired by 2nd suit? Martino allowed
to proceed
1

First suit ended in a valid, final judgment on merits

On merits other than issues i.e. jurisdiction - venue, personal jurisdiction,
subj matter jurisdiction

Issue(s) [for issu

preclusion]

Rinehart v. Locke
Suit

P(s)

D(s)

Court

Claim(s) brought

Rinehart

Police
officers

Fed

4th Amendment
violation - no
probably cause

II

Rinehart

Police
officers

Rinehart - judgment on merits unless ct says otherwise - "w/o prejudice"

Rehnquist bars both fed and st claims on artful pleading
Blackman - gets it right - everything part of same claim whether or
not it was explicitly mentioned
1
Statement of res judicata wrong
1
Overall holding proper - dind't pursue every avenue to obtain a
reversal
Exclusive - fed antitrust claims - state law
Can only be brought into fed ct if supplemental or diversity
I.
St - state claim
I.
Fed - fed claim
Technically an exception w/ 26(1)(c)
Some courts will say should've filed in fed ct first but won't bar by res
judicata
Final judgment on the merits?
Semtek 41(b)
i. Full faith and credit clause embodies some of the choice of law doctrine
1. Req one state ct give full faith and judgment to another st ct
1. Along with that judgment of a aprticular state ct is wrapped up that state's RJ rules
i
1738 - enacted to tell fed cts to do the same thing when interpreting preclusive effect of st
ct judgment
1. Fed ct when being called upon to see an earlier st ct judgment precludes a judgment,
wil llook at preclusion law of that state
1. Marese case - said that gen rule and a fed ct can never give a state ct judgment more
preclusive effect than the st ct itself could give
a. If st itself would not cut off somebody, fed ct can't
a. Some situations, fed ct MAY give less than preclusive
i.
Not sure when there is an EXC to 1738 but theoretically it's out
there
i
If first fed ct entered judgment, fed ct sitting in 1331 (fed Q) then fed ct gen follow Rest
and SC case law, normally dealing with Rest when fed ct judgment when case based on
fed law arising under fed Q jur
i
When sitting in div, tricky
1
Semtek
Scalia => True Erie analysis bc 41(b) doesn't govern => Outcome Determinative
Test
All ct interpreting res judicata effect of fed ct judgment sitting in diversity must
apply res judicata law of ct its sitting in

Issue(s) [for issu

preclusion]

MD - supposed to look at CA law

SC => rem'd to MC ct to make proper analysis of st governing law of res judicata
Byrd - consider whether major fed int might be impinged by state law
Ex - if fed ct sitting in diversity had dismissed caes against P or intered
default judgment on discovery violation, in order to protect ct's integrity to
protect against sanctions, might be able to fashion its own rules of fed C/L
rule to of res judicata (possibility), otherwise look to fed ct which it sits
When you may be able to override scheme - akin to Byrd
In GEN - ct later deciding preclusive effect of fed ct judmgent, will try to apply
preclusion law of the state in which fed ct sat
i
Fed dist ct - DE - (div)
i
State ct - MD (called upon to determine preclusive effect of judgment)
CT - in gen, st ct in MD would apply DE st law of preclusion to determine
preclusive effect of that judgment
Even may not be complete end
Could say state of De follows Rest of Judgment making its RJ decisions
Aware of complexity of system
Recognition as to WHY Restatement of Judgments is being applied rather than
some other law of RJ
1.

COLLATERAL ESTOPPEL/ ISSUE PRECLUSION

ELEMENTS
1. Same issue in both cases
1. Issue was actually litigated in first action
1. Issue was actually decided in 1st action
1. Issue was essential to the judgment in 1st action
Handout
Prob
1.

Suit

P(s)

D(s)

Court

Claim(s) brought

Issue(s) [for issue

preclusion]

Re

Pond

Drug

Fed

Goods sold

Did orig party pay?

Jud

II

Drug

Pond

Fed

Breach of warranty on
same goods

22 - Compulsory Counterclaim - fed ct => FRCP

13(a) - Does claim arise out of same transaction or occurrence? Yes
Don't need to go further than claim preclusion => barred by claim preclusion
Prob
1.

Suit

P(s)

D(s)

II

Court

Claim(s) brought

Issue(s) [for issue

preclusion]

Res

Goods sold Jan 1

A fraud

Jud

Goods sold Jun 1

a. No - bc suit b/t Jan and Jun, not in the same claim

a. Issue

1. Fraud in both
1. Only defense
1. Verdict for A - couldn't have found for A if ruled there was fraud
1. Essential
Issue preclusion - Was it actually decided?
Nothing in 1st suit about impossibility - NOT precluded

Prob

Suit

P(s)

D(s)

Court

Claim(s) brought

Issue(s) [for issue

preclusion]

Resu

3a

Fed

Installment K #1

S/F

Judg

II

Fed

Installment K #2

S/F

Fed

Inst K #1

S/F

II

Fed

Inst K #2

Mutual Mistake

Fed

Inst K #1

S/F

II

Fed

Inst K #2

Mutual Mistake

Fed

Inst K #1

S/F

II

Fed

Inst K #2

Mutual Mistake

3b

3c

3d

a
a
a

S/F is a legal issue

Wouldn't have found for A if judge ruled unenforceable
Not decided in first case- not barred in 1st case
Installment K - depends on when you bring suit
Can't raise - issue precluded - not enforceable

AFFECTS ISSUE PRECLUSION

GENERAL VERDICT - doesn't explain reasoning
How do you know it was decided?
Verdict for D - diff category for issue preclusion
P

Offer/acc/cons

S/F

Breach

M/M

Damages
Verdict for P - by logic, P must prove factors and that D couldnt prove
Verdict for D - only has to disprove P's claims
SPECIFIC VERDICT - certain key questions are asked of jury regarding liablity
Jury not coming out w/ bottom line
Judge takes specific verdict and enters gen verdict on spec verdict

SPECIFIC w/ Interrogatories
See reasoning more in-depth
Barred - jury must've found in favor for D
More hairy when verdict for D

Judg

Gen

Gen

Prob
a

Suit

P(s)

D(s)

Court

Claim(s) brought

Issue(s) [for issue

preclusion]

No CC

P.I for A

E neg?

Fo

II

P.I for E

A neg?

Contributory negligence
Claim is really diff - not same claim
Issue
Restatement Commentary - same issue given an ultimate meaning?
Was E negligent? Judge could've found ofr E bc he wasnt neg or A was
Don't know if actually decided => 29
Hardy v. John-Mansville
Suit

P(s)

D(s)

Court

Claim(s) brought

Borel

6 mfr [JM]

Fed

P.I asbesthos

II

Hardy

Same D (not all)

[JM]

Issue(s) [for issue

preclusion]

Resul

Judgm

New P trying to sue D for same claims as old P

2nd suit incl same D but not all
If w/in new D #7, #7 cannot be collaterally estopped bc it would violate due process
Issue
CT => jury must've found that products were unreas dangerous, therefore duty to warn
Jury not specific about when mfr knew prod dangerous and when there was duty to warn
Issue preclusion NOT allowed
Sunnen - BOTH Claim AND Issue Preclusion Issues
Tried to assign income to wife while still having control over her accts
Suit

P(s)

D(s)

Issue(s) [for issue preclusion]

Result

IRS

Sunnen

1928 K: tax ability of income

payments 1928-31

Judgment for D
Sunnen wins, makes other similar Ks like th
K

II

IRS

Sunnen

1.
1.

1928 K:
<= seems like it should be barred by claim
payments after 1931
preclusion
Payments under,
after 1928

Claim Preclusion
Each year, tax obligations
1. @ time IRS brought suit, IRS couldn't raise bc in future
1. Every tax year is a separate claim even if exactly the same circumstances
NO claim preclusion => Issue Preclusion
CT rejects - IRS not barred as to issue preclusion
(2) ct relies on formality
K after 1928 similar but it was diff - same issue

Not determined
Removes issue preclusion to (2)
(1) problematic
Essential issue - Did Mrs. Sunnen's assignment of income constitute a violation?
EXC to normal operation of issue preclusion
CT - as time goes on, change in substantial law, unfair to other taxpayers that Sunnen enjoys
tax benefit
Disparty b/t Sunnen and other taxpayers
Rest => Exc under 22(2)
Although issue litigated and determined, re-litigation in subseq act
1. Legal issue as matter of law - not reqmt that it'd be an issue of fact, can be issue of law
1. 2 actions involved 2 claims substantially related
1. To avoid inequitable administration of law
Was issue essential to judgment?
Judgment for D issued
(separate but equal)
1. P contri neg <= essential to judgment in 2nd suit?
Rest => Neither finding essential to judgment
Other courts disregard and consider both essential, therefore, either
barred
1. D not eng
PRIVITY - legal relationship that provides that another person is considered same party
i. Applies in issue and claim
Little v. Blue Goose
Suit

P(s)

D(s)

Court

Claim(s)
brought

Issue(s) [for issue

preclusion]

Result

BG

Dr

Justice of
Peace

Bus damages

Neg

Judgmen
$139

II

DR

BG

City ct

Pers injury

BG => barred from res judicata

Why doesn't 22 bar frm 2nd suit bc its counterclaim?
Case in Justice of Peace, no rule for CC
Possible limit on subj matt jur
Rule of ct prob prevents
Claim preclusion => privity - legal relationship
Mrs if Dr's executrix
BG => issue preclusion
Defense
i.
Dr was neg
i.
BG not neg
Implicit in 1st suit serves to decide neg
Contr neg defense not available to willful neg
Necessary to make proof of willful neg
Harsh operation - could've appealed => barred in 2nd suit

i. Taylor v Sturgell
1. Situation where ct upheld privity where party bound to judgment of another
1. Rejected virtual rep - amorphous concept
i
Should know law NOT in Restatement
Taylor v. Sturgell - wanted specs submitted to FAA and wanted to refurbish old plane to fly
Suit

P(s)

D(s)

Herrick

FAA

II

Taylor (Pres of FAA

org)

Court

Claim(s) brought

Issue(s) [for issue

preclusion]

Result

1.
Wyo

FOIA - fed statute

Is it trade secret?

SJ for FAA
secret exc p
applied
AC => aff'd

1.
D.Ct

FOIA allows going to

TC for review of agency
holding

Tc relied on Doctrine of Virtual Representation

Like Hansbury v. Lee
Fundamental idea - each have right to day in ct
EXC develoepd - Rest beyond 42
VIRTUAL REPRESENTATION - SC not willing to go off of 6 broad categories to due process
rule
1. [a] person who agrees to be bound by the determination of issues in an action between
others is bound in accordance with the terms of his agreement.
dismissing certain defendants from a suit based on a stipulation that each of said
defendants ... will be bound by a final judgment of this Court on a specified issue
Agree whatever judgment in test cases
Binding on everyone else under issue preclusion
1. nonparty preclusion may be justified based on a variety of pre-existing substantive legal
relationship[s] between the person to be bound and a party to the judgment. Qualifying
relationships include, but are not limited to, preceding and succeeding owners of
property, bailee and bailor, and assignee and assignor. See 2 Restatement 43-44, 52, 55.
These exceptions originated as much from the needs of property law as from the values
of preclusion by judgment.
May be subst legal relationship
Prop relationships tend to fall within this section
1. we have confirmed that, in certain limited circumstances, a nonparty may be bound by a
judgment because she was adequately represented by someone with the same interests
who [wa]s a party to the suit. (internal quotation marks omitted). Representative suits
with preclusive effect on nonparties include properly conducted class actions, and suits
brought by trustees, guardians, and other fiduciaries
Nonparty bound by judgment bc adequate rep - on behalf of stronger person
42 - trustee, lawyer, executor, guardianship, conservator (legal relationships)
23 - rep of a class who is deisnged
1. a nonparty is bound by a judgment if she assume[d] control over the litigation in which
that judgment was rendered.
Because such a person has had the opportunity to present proofs and argument, he has
already had his day in court even though he was not a formal party to the litigation.
If she assumed control over litigation in which judgment is rendered
Montana v. Us
US req'd Kor to sue Montana and lost

D.ct => bar

preclusion

Then US tried to bring suit in its own name

SC barred bc "technically" had its day in court
1. a party bound by a judgment may not avoid its preclusive force by relitigating through a
proxy. Preclusion is thus in order when a person who did not participate in a litigation
later brings suit as the designated representative of a person who was a party to the prior
adjudication. And although our decisions have not addressed the issue directly, it also
seems clear that preclusion is appropriate when a nonparty later brings suit as an agent
for a party who is bound by a judgment.
Relitgating by party
1. in certain circumstances a special statutory scheme may expressly foreclos[e] successive
litigation by nonlitigants ... if the scheme is otherwise consistent with due
process. Examples of such schemes include bankruptcy and probate proceedings,
and quo warranto actions or other suits that, under [the governing] law, [may] be
brought only on behalf of the public at large,
Stat scheme
Ex - bankruptcy
Ct takes debtor's assets and discharges
GINSBURG - doesn't think there needs to be 7th exc
=> RJ bc it avoids unnecessary litigation
Rules out based on parties' concessions, 4/6 has no grounds
2nd suit - Was Taylor adequately represented in Herrick's case?
ADEQUATE REPRESENTATION
1. Interest of nonparty and so-called rep aligned AND
Ex. Where this isn't met => Hansbery
Herrick and Taylor's interests aligned
1. (a) special procedures in 1st case that there were employed to protect interests of nonparties;
OR
(b) parties in 1st suit understand they are acting of representative capacity of unnamed
parties
AND
1. Non party has to have rec'd notice of 1st suit (Ct never addressed)
Notice of 1st suit in damages claim only in 23(b)(3)

a.

23(b)(1)-(2) - not absolute, req'd in case of due process

CT rej adequate rep as applied to Taylor
Only exc to due process => precluded bc nonparty brought suit prior to adjudication
CT rem'd to lower ct - Did Herrick get Taylor to act as agent
1179
The preclusive effects of a judgment in a federal-question case decided by a federal court should
instead be determined according to the established grounds for nonparty preclusion described
in this opinion
Fed Q suit decided by fed ct
RJ developed by C/L of Fed Sc
Richards v. Jefferson Cty
Suit

P(s)

D(s)

Court

Claim(s) brought

Issue(s) [for issue

preclusion]

Re

Bedingfield+ cty
taxpayers

Jefferson Cty

AL state

Enjoin occupational
tax

AL constitution

Fo
up

II

Richards + non-fed
employees

Jefferson Cty

AL state

Enjoin occupational
tax

Fed and AL
constitution

SC = no indication that 1st P acting in rep capacity and 2nd P had no notice of 1st suit
=> violation of due process to bind to judgment of 1st suit
MUTUALITY - when you do not have privity
Parties not in privity
If in privity, same person even though 2 diff entities
=> Mutuality of Preclusion
Only applies to issue preclusion
Parklane - propriety of use of offensive collateral estoppel
MUTUALITY OF ESTOPPEL
Assumed parties are the same
Now, diff party involved against 1 common party
If enough of a relationship, then maybe diff party subject to preclusion
If not, due process consideration and binding to prior judgment is a possible due
process violation
NON-MUTUALITY
FOUR EXHAUSTIVE SITUATIONS where you can see non-mutuality of parties
Situation A
Suit

P(s)

D(s)

P1
not same

II

P2

Court

Claim(s)
brought

Issue(s) [for issue

preclusion]

Result

Same

Same

Judgment for D
P1 loses

Same

Same

Due process violation to

unless exceptions in Stur

Assume all elements of claim/ issue preclusion have been met

D will try to argue P2 barred
Gen Rule - If hold P2 to adverse judgment to P1, due process violation if bound since not named
=> 6 exceptions
Currie Ex
P-1 v. Train

P-1 loses

P-2

P-2 loses

P-3

P-3 loses

.
P-25 v. Train
P-26.
P-50
Unfairness f result

Judgment for P-25

Can collaterally estopp from litigating against claim for negligence

IRS
P-1 v. IRS
Tax that P-1 argues is illegal

P-1 wins - tax illegal

P-2 v. IRS
Same issue, D should be estopped from relitigating
Consideration - legal environment is changing, govt has duty to act in public's best interest, if
new P allowed to use against govt, govt would have to appeal every decision - too much pressure
Offensive estoppel not going to happen against US govt
US v. Mendoza - INS
Problems

Suit

P(s)

D(s)

Court

Issue(s) [for issue

preclusion]

Result

1-2

Pia

Dart

WCC

Is Pia C/L wife?

Judgment for D-Dart

II

Pia

Truck

Fed

Same

Pia

Dart

Fed

a.

C/L
Dart

Gen verdict for Dart - could

under either grounds so don
which issue was decided

C/L

Gen verdict for Pia

wife?
a.
neg?

II

Pia

Truck

Pia

Dart

C/L wife

Fed

1.
wife?
1.

Dart
neg?

5-6

II

Pia

Truck

Pia

Dart

II

Ryan

Dart

C/L wife

Fed

Reasoning for Parklane applies to both defensive and offensive estoppel - EXC in 28

Gen verdict for Pia