Beruflich Dokumente
Kultur Dokumente
Subject Matter
we go to state or
Two ways to get into federal court / Windows to federal court2 forms of jurisdiction: 1. Diversity, 2. Federal question (both come from
Art III Sec 2).
1332 Diversity; 1331 Federal Question (No 1331 until 1875, no general fed question jurisdiction only statutes.)
1. Diversity ( 1332) suing under state law state common law claims and different state to avoid out of state prejudices to give a
fair chance: requires (i) diversity in citizenship (complete diversity under strawbridge); (ii) AIC: constitution says nothing about it but 1332.
(creates a filter, narrows jurisdiction.) - < $75,000
2. Federal Question ( 1331) second door to get into federal court; well-pleaded complaint rule
- Two kinds of cases the fed ct. wont hear: family law, (divorces etc. even after meeting AIC) and general probate cases (will, trust) even where
the requirements in div. are met.
A. State Court Cases: Family law, no state diversity, AIC < $75, 000
C. Federal Court Cases: ex. Patent law exclusive area of federal jurisdiction.
B. Overlap of A & C: Fed. Question claim can be brought to state court.
- Diversity met but does not want to remove.
- Challenge of SMJ is most fundamental challenge for constitutional reasons. - can be brought in anytime (can be used as a trap with SOL issues
in order to stall the case.)
A. Diversity of Citizenship
1332 (a)(1) - Two requirements for a diversity citizenship case: (a) Case must be between citizens of different states; (b) Amount in
controversy must exceed $75, 000. (Mas v. Perry, AIC $10,000 then)
a. Case must be between citizens of different states.
i. Complete diversity rule for invoking diversity jurisdiction there is no diversity if any plaintiff is a citizen of the same state as any
defendant. (Strawbridge v. Curtiss)
ii. An American is a citizen of the state in which she is domiciled. Domicile Test: RESIDENCE + INTENT TO STAY
b. Amount in controversy must exceed $75, 000. : Not constitutionally required, added by . (Art.III2 is further narrowed by 28
U.S.C. 1332(a) brings in AIC ($75, 000) governed by Strawbridge; complete diversity
Diversity Test: P or are domicile where? residence + intention to stay
at what point does one develop an intention to stay? have they put down roots like voters card, house, dl etc. - this means that even not
permanent but my house for now; domicile - not purely objective, court looks at transitions, where are they moving, plan to move etc. Mas v.
Perry - res. with intention to stay Mrs. Mas had left Miss. , even then didn't lose Miss res. until went somewhere
1.Foracorporation,citizenshipisdefinedby1332(c)(1).Corporationisacitizenofallstateswhereincorporated,and
thestatewhereithasitsprincipalplaceofbusiness(NERVECENTER.)corp.treatedaspersons.
2.Partnerships:Distinct,partnershipsofindividuals,ifpartnersliveinmanystatesthendomicile=everystatewherethe
partnerlives.
3.Familylaw(ex.Divorce)andProbate(ex.Will)wontbeacceptedinfed.courts;fallattheheartofstatecons.sov.
Rule of Complete diversity is required with multiple parties:
- No P from same state as any of the D - strawbridge case complete div not constitutionally required but court in 1886 read complete
diversity into the statute.
- Business entities 1332(c): corporations: state of incorporation and principle place of business. - NERVE CENTRE THEORY (the brain,
where decisions are made)
- Partnerships and other entities: 1332 doesn't speak, has been interpreted: domiciled in every place where their partners are domiciled.
- Aliens: 1332 a2, a3,c1 : If someone is here legally with green card they are domiciled in the state where they reside, PR are treated as residents
of that state 1332a2 makes clear that P and D some of whom are aliens living here; ex P from IL suing British PR residing in IN - can be sued
under 1332a2, but cant sue a PR residing in IL 1332a3: aliens not PR here.
- American citizen + British National can sue Australian National (as long as any one side has a US Citizen).
One exception to complete div = class action, 1332d (provides for how class actions are treated) - congress passed class action fairness act (10
years ago) : prevents minimal diversity as minimal diversity is all you need. Amt. in C. = $5mill. (all aggregated claims)
Aggregating claims:
P $30,000 D + another $50,000 claim, can aggregate but what cannot happen is two plaintiffs joining the claims and aggregating
Separate plaintiffs cant aggregate - will be the end run around the controversy.
Suppose there are two defendants: D1 and D2, can P get into fed court by aggregating the claims of these two Ds - NO
- Each party has to come in on his own against a particular defense. Cant bootstrap by suing a second D.
GRABLE v. DARUE
Facts: The IRS seized P's property to satisfy P's tax delinquency. IRS sold property to D. P did not exercise its right to
redeem the property within 180 days of the sale even though P was given notice of the sale through certified mail. 5 years
later, P brought a quiet title action against D and claimed that P was not notified in the exact manner required by federal
statute. (personal service v. certified mail). D removed the case to Federal District Court as presenting a federal question
because the claim of title depended on the interpretation of the notice statute in federal law. P sought to remand the case to
state court. District Court denied and granted summary judgment to D.
PH: Circuit Ct: Judgment for D (proper jurisdiction); COA: Affirmed; SCOTUS: Affirmed, found proper FQJ
Issue: How can a claim involving a cause of action not started by a federal statute be tried in federal court under federalquestion jurisdiction?
Rule: A federal court may have jurisdiction over a state cause of action, if the action has a substantial federal component in
actual controversy, and federal jurisdiction would not disrupt the balance of labor between state and federal courts.
Hold: A claim that doesn't follow the "creation test" can be tried in federal court if the court decides that the state law claim
necessarily raises a stated federal issue, actually disputed and substantial, which a federal forum may entertain without
disturbing any congressionally approved balance of federal and state judicial responsibilities.
26 USCS 6335 (a); This case warranted federal jurisdiction because the owners claim was premised on the IRS failure to give
adequate notice as defined by federal law.
The s meaning belonged in federal court given the governments strong interest in tax collection.
Forum non-convenience A discretionary power that allows courts to dismiss a case where another court or forum is much better
suited to hear the case. This dismissal does not prevent P from refiling his/her case in the more appropriate forum.
Two overlapping circles:
A: State Ct.
C: Fed. Ct. (Div. Juris and FQJ)
- Exclusive fed. jurisdiction
B: - Where P has a choice to go to state federal court.
o
For non-exclusive federal claim also.
RECAP:
o
P has federal cause of action, but brings it to state court.
o
Removal: Defendant can remove P to federal court, if P could have gone there in the first place. (This is consistent with Mottley.)
o
Can D remove on the basis of his counter claim.? with P and D, it is sometimes a matter of who got there first. If D got there first,
he could have gone into federal ct. if he had a fed. claim.
1
- On the face of Ps cause of action fed. cause of action.
o
D may bring later in another case if no intrinsic connection in federal court.
1
P state D
2
CC (fed. claim)
- Can D remove? No, because he can only go on Ps counter claim. (Ps original claim should have been fed. one)
o
Under Art.III Sec. I when 1331 was passed, it was written much more narrowly however, 1257 was written much broadly
increasing/extending FQJ 1257 and others constitutional (if there is some fed. q.) even though they could not be brought
under 1331.
o
Congress can pass a as long as there is somewhere a fed. issue. But, cant pass a general , that will be unconstitutional
and will go against Art. III.
Moving back to GRABLE v. DARUE
Falls between two cases: 1. Kansas City & Title 2. Merrel Dow v. Thompson
Smith v. Kansas City Title & Trust Co. 1920 (391-394)
Missouri bank invests in federal agricultural bonds. Shareholders complaint states that these bonds are illegal under the constitution, and under
Missouri law you cannot invest in something that is unlawful. He sought to enjoin the bank from investing in these bonds.
Merrell Dow Pharmaceuticals Inc. v. Thompson 1986 (394-401)
Scottish and Canadian claimants sue D over Benedictin in part because it was improperly labeled by FDA standards. They have state law claims
only the FDA standard is not privately enforceable, but it is argued that it creates a rebuttable presumption of negligence.
1. Smith v. Kansas City & Title (1921): Shareholders derivative suit: is suing his own corporation bonds issue.
- unconstitutional: They were federal bonds issued unconstitutional way by the corporation
Mottley: Fed. Q (one of the basis for well pleaded complaint) must be apparent on the face of a well pleaded complaint its a cause of federal
action.
o
How is federal issue relevant in Smith? does it go beyond Mottley? No federal clause of action (in Ps case).
o
In Smith Outside of scope of Mottley. There is a federal issue under Ps case. if a federal issue has to be determined, it doesnt
require it to be Ps cause of action but has to be part of Ps case could be a state claim depending on federal issue.
o
Smith enlarges FQJ
o
Smith -- s case (entire action dependent on determination of federal issue.)
o
or common law rights give P a right to recover.
2. Merrell Dow v. Thompson(1986)
- Ps case, its a tort case (Ps trying to keep it in state court.)
- P brought 6 causes of action, 5 state law; 1 loose interpretation (federal statute) was also state law (but if interpreted a particular way, an
inference could be drawn with fed. law).
- Ct. No Fed. Ct. Jurisdiction
In Darue, Smith was distinguished from Merrell Dow. Darue, not governed by Merrell Dow but Smith.
o
How did Smith go beyond Mottley?
o
How is Merrell Dow different from Smith?
o
Why is Darue more like Smith?
Mottley: Federal issue must be in claim itself.
Smith: In order to determine a state action, must understand the (underlying) fed. q. first.
o
Are bonds from fed. gov. illegal?
o
Similarly, in Grable cant answer until answer the fed. q.
In Merrell Q of liability does not depend on FDA regulation issue. still birth defects irrespectively (no matter the answer), hence, Tort Q.
Go to state remedy depends on what state decides.
- Labelling doesnt come into play.
C. SUPPLEMENTAL JURISDICTION
1. PENDANT
JURISDICTION
2. ANCILLIARY
Supplemental jurisdiction refers to the various ways a federal court may hear either: state law claims, claims from parties who lack the amount
in controversy requirement of diversity jurisdiction, when defendants are joined in claims, or when multiple plaintiffs are joined in claims, like
in class action suits.
- If state law claim arises from the same factual situation as fed claim not fair to make P go into both courts
No diversity jurisdiction because he is suing a union, and they have citizenship everywhere for diversity purposes.
This does not fall under 1331 because it is not a question of whether there is any federal claim at all, it is whether there is also
jurisdiction over the state claim.
The existence of pendant jurisdiction does not depend on the success of the federal claim, it just depends on the existence of a
federal claim.
This cannot be in federal court, because 1983 specifically states that entities cannot be sued.
o
violating the purpose of the statute of not suing entities under 1983 in federal court.
This is different from Kroger because this is not pendant party, it is pendant claim jurisdiction.
REVIEW:
Gibbs : Federal Question if the anchor claim is a federal question claim and there are other claims stemming from common nucleus all
those claims can go in (even if under state claim) as all come out of state claim.
Continuing with supplemental jurisdiction 1367
- after 1367 passage, if in federal court with anchor claim (state claim) 1367(a)[giveth] under Article III state claim arising
from common nucleus of operative facts, federal court will take it.
- 1367(a) is a very broad grant of supplemental jurisdiction
-1367(b)[taketh away] deals with 1332 (diversity cases) in situations where anchor claim is diversity claim.
Hypo: P(IN) (IL) + state claim
under 1367(b) same P, same hence, both come in under Div. in Fed Q but is P wants to sue II ; P(IN) D1(IL)+D2(IN) P
cannot sue from same state.
- 1367(b) under RULE 20 Joinder, you cannot join D1 and D2 as that would violate diversity and 1367(b) does not permit that.
- But if P wants to stay in state court, he will bring in 2 to beat diversity.
D. REMOVAL
(p1000)
1441, 1446, 1447
P CANNOT REMOVE, only D can remove, but only on the basis of whether P would have gotten into fed ct. in the first place - Same principle
as Mottley (well pleaded complaint rule)
1441(b)(2): if any of the D reside in the state where the suit is taking place, D cannot remove to fed ct As D can expect a fair treatment from
his own state if 1 D from Ca and 1 in OH, same principle cannot remove, all Ds will have to agree to the removal
1446: D has to remove within 30 days of getting the complaint1446 also says that in no case it shall be more than a year or later. In case of
diversity. No more than a year later unless a bad faith by P.
- Overlapping circles A:State Ct.; C: Fed. Ct. overlapped area B Removal involves cases where P could have gone to federal or state court
(Mottley ruling applies to removal and P going to federal court in the first place)
- Why P would choose to stay in state court? Fed Courts are overwhelmed (p1001) federal judges are leaning on P and D to settle. Ds know
that, hence, they try for removal.
- Removal is mostly in Ds interest
- Forum Non-Convenience (Forum non conveniens is a discretionary power that allows courts to dismiss a case where another court, or
forum, is much better suited to hear the case. This dismissal does not prevent a plaintiff from refiling his or her case in the more appropriate
forum.): easy to get case dismissed by D.
P 1011-1012: New things happen as litigation unfolds 1. Removal, 2. When can it occur, 3. Timing, 4. 144 (b), 5. Parties claims
added/dropped: state ct. claim may become fed. ct. claim and vice-versa.
- What a P can do to defeat removal?
o
In smaller amount case, can request < $75, 000
o
In big amount case, P can sue another D2 (bring in someone from state) and defeat diversity
o
Suppose D removes from state ct. to IN fed. court D has 30 days, from the day removal info is received.
o
For Div cases, 1year limit to remove (from filing of complaint)
o
FQ you can remove even after a year
HYPO: p IN
$1M
d OH
- P should go to OH, to remain in state Ct. and D cant remove to fed. ct. as no prejudice issue.
- 1441(b) one way to prevent removal in div. cases (motivated by fear of prejudice) go to D state court to beat prejudice issue.
p.1011-1012: Joinder and Remand
1441 permits D to remove an entire state court proceeding if it includes both a federal question claim under section 1331 and a claim not
within the original, supplemental or removal jurisdiction of dist.ct. Upon removal, section 1441 directs that the dist. Ct. shall sever-andremand the claims that do no fall within its original jurisdiction.
- 1447 permits P to move to remand a case that was not properly removed.
Part II
(PERSONAL JURISDICTION)
CHOOSING THE FORUM GEOGRAPHICAL LOCATION
as it involves property and everyone basically knows that every person gets some kind of notice to property
Doctrine of Fraudulent Inducement : P cannot be pulled into state to be served through fraud.
In quasi in REM, if you attach property, the court can only award = value of property but no more, as court has jurisdiction power only over
property
HYPO: NY D -- $10M suit, in CA court; he can only be sued up to the value of the property owned in CA. For rest of the money, P can sue D in
some other jurisdiction for the remaining amount. property is irrelevant to the substance of the case, only used to attach to the D to pull him in
CA court.
HYPOS: Ps lawyer IN, doesnt get paid for legal work by IN D; what if D leaves IN and moves to FL?
- What if D has property in IN? P can get value = value of property only
- Can D be sued in FL under NEFF, if no property quasi in REM case? They can be sued in FL court but not a very attractive
option.
- What if P doesnt want to go to FL?
- What about KY, where D has property? D can be sued quasi in REM in KY.
- Kids in IN, D in FL, no property in FL? If they are back for some reason, can be served; but this could be a problem too.
- Can you make fraudulent inducement to call them NO?
HYPO2: Suppose your client gets struck by a FL motorist and he goes back to FL, what can you do?
Harris v Balk
Harris (NC) owes Balk (NC) $180. Balk owes Epstein (MD) $300. Harris takes a trip to MD and Epstein
serves him for the $180 he owes to Balk. Epstein names Balk as defendant, and grabs Harris as the $180
in debt. Harris pays the debt to Epstein, goes back to NC and Harris sues Balk for his $180. The case
turns on whether MD had jurisdiction over Balk to adjudicate.
HESS v. PAWLOSKI
Doctrine of consent constitutional
- Two ways to exercise jurisdiction: 1. Presence; 2. Consent (in this case) by serving REGISTRAR, Sec. of State link
between POWER AND NOTICE.
s from Pennsylvania heading up to Massachusetts, where they have a car wreck. In order for the person who got hit in
Massachusetts to sue, they must serve the person that hit them personally in Massachusetts Rule (passed because of this) MA
statute stating that a non-resident that enters and utilizes MA road is implicitly consenting to personal jurisdiction for suits arising
from his motor-related activities.
International Shoe
Facts: DE Corp. based in MO does business in WA through independent contractor salespeople. Washington
is trying to get the company to ante up for its unemployment fund. Washington served Shoe notice of assessment by personally
delivering it to one of their salesmen in Washington as well as sending registered mail to their home office in St. Louis.
Procedural History: Shoe made a special appearance in Washington to argue that the service of process on the salesman was not
proper and that Shoe wasnt doing business in Washington according to the statute. The courts in Washington found that Shoe was
amenable to personal jurisdiction in that state. Shoe appealed up to the U.S. Supreme Court.
Issue: Under what conditions is a corporation subject to personal jurisdiction in a particular state?
Rule: A corporation that is protected by the laws of a state shall be subject to personal jurisdiction in that state.
Analysis: The court interprets the due process clause and the Fourteenth Amendment to mean that if a company has sufficient
contacts in a state, they may be subject to being sued in that state.
- 1945 case, an essence of a modern era case big shift in philosophy from Pennoyer, though not totally away.
- Corporation considered a person under law
- WA suing in WA; SCOTUS There is jurisdiction Indicated a shit in term Personal Jurisdiction over a in a state by the state can
be had if Minimum Contacts
- Traditional notions of Fair Play and Substantial Justice
- Two consequences of this case:
1. Minimum Contacts
2. Dont have to be in state to be served crucial links between power and service are broken new prevailing law therefore, after this in all
previous hypos, s can be served.
This is a case of general personal jurisdiction A nexis between basis for jurisdiction and suit subject of suit can be different from basis of
jurisdiction.
The minimum contacts test: International shoe the courts of a state may exercise personal jurisdiction over defendant if she has such
minimum contacts with the state that it would be fair to require her to return and defender lawsuit in that state.
- whether jurisdiction is permissible depends on the quantity and nature, even a single contact would do, but not casual or isolated.
- a Corporation that uses to conduct activities within the state accept reciprocal duty to answer for its in-state activities in the local courts. the
defendant to deliberately chooses to take advantage of the benefits and protections of the laws of a state will not be heard to cry foul when that
state holds her to account in its courts for her in-state acts. voluntary relation between the defendant the state power to exercise jurisdiction
arising from that relation.
- therefore, under international shoe, the corporation could not have been required to defend a claim in Washington arising from shoe sales in
Texas under the minimum context analysis, it must always consider the relationship between the contacts that give rise to the suit and the state
where the suit is brought.
- If Minimum Contacts In personam jurisdiction can be attained
After International Shoe In Personam is about minimum contacts
Cases where defendant has no contact with the forum state, State has no authority exercise personal jurisdiction over the defendant, unless she
consents to it.
SMJ + PJ both have to be satisfied in federal court
Using the Intl Shoe minimum contacts does not offend fair play and substantial justice.
PURPOSEFUL AVAILMENT
purposefully availing itself of the privilege of conducting activities in the forum state, availing the benefits and protections of its laws.
defendant must have made a deliberate choice to relate to the state in some meaningful way before she can be made to bear the burden of
defending there.
this case is different from McGee
Hansen v. Denckla
Facts: A family fought over the estate of Mrs. Donner, who had established a trust in Delaware but had then moved to Florida and died
there. If Florida had jurisdiction, one daughter would get everything, while if Delaware had jurisdiction, three daughters would share.
Issue: Are there sufficient contacts between the trust company and the state of Florida for the state to have specific jurisdiction?
Rule: If there are only minimal contacts between a state and a defendant, then the contacts must be closely related to the claim.
Analysis: The court says that the contacts were not sufficient in volume, nor were they sufficiently related. The court concedes that the
trust paid income to her in Florida and she did a little bit of work on administering the trust from Florida, but the court says thats not
enough.
Conclusion: The court rules that Florida does not have specific jurisdiction over this matter.
defendant must have purposefully availed itself of the benefits and protections of the forum states laws to have minimum contacts Did
took advantage of state in anyway, some attempt by to direct his act to that state. Purposeful Availment is a limiting principle.
10
Due process clause of the 14th amendment imposes fundamental limitations on the power of state courts to exercise personal jurisdiction over
defendant in civil suits. States may only assert jurisdiction over defendants who have established a significant relationship to the forum state,
such as domicile, in state presence, continuous and substantial business within the state, consent to suit in that state, our minimum contacts with
the state that gave rise to the claim in suit. only defines the outer bounds of permissible jurisdictional power.
Two-step analysis first, whether there is a state statute that authorizes it to exercise personal jurisdiction under the circumstances of the case,
second, if there is, whether it would be constitutional under the due process clause to do so.
Long arm statutes authorize courts to exercise jurisdiction over defendants based on specific types of contact with the forum state.
International shoe and succeeding cases States adopted long-term statutes to authorize their courts to hear cases arising out of such contacts.
for example cases such as transacting business in the state, owning property, committing tortious act within the state etc. a good deal of
jurisdiction authorized by the due process clause but not all of it.
Primary purpose of the long-term statutes to reach out that the state to call nonresident defendants back into the state to defend
lawsuits; even though the defendant has left the form state before he he is sued, he may be required to defend a suit there under the international
shoe analysis if this suit arises out of his prior contacts with the forum.
should not exceed its constitutional grasp refuse to apply to cases that fall outside the bounds of due process all long-term statutes that
base personal jurisdiction on specific enumerated acts require that the claim sued upon arise out of The act itself Limited in state contacts only
support jurisdiction over claims that arise from those contacts.
Reasonable inference that Grays product would lead to substantial use and
consumption in Illinois.
Modern times make commercial activity in other states necessary and foreseeable, not
inconvenient for D to defend there because of transportation and technology.
long-arm statute
o
the long-arm says that the commission of a tort within the state creates longarm jurisdiction
- IL says, well settled that a tort occurs where final act occurs
- says no Purposeful Availment as OH ->PA but no contact with IL
- Hence, IL Supreme Court broadly interprets statute to develop SOC
Court concluded that The Ohio water maker the tendon nothing in Illinois had committed
foreseeability alone has never been a sufficient benchmark for personal jurisdiction under the Due Process Clause.
law should give a degree predictability to the legal system that allows potential defendants to structure their primary conduct
with some minimum assurance as to where that conduct will and will not render them liable to suit.
SMJ + PJ may sometime clash with one another.
- P is a domicile of NY as hasnt reached AZ yet. Have yet to establish residency.
- Domicile is not necessary in PJ
11
- This case, P suing in OK St. Ct. as juries pro P, hence, P want to stay there hence, keep out of federal court in OK, otherwise will be
transferred to NY (jury not pro P)
- OK long arm State court says OK has jurisdiction OK superior court says if NY (Seaway and VW) derives substantial revenue from
goods used/consumed in the state This is the only car entering the state that we know of.
- Statutory language is the basis for courts jurisdiction and OK is trying to stretch it very loose reasoning.
Calder v. Jones Purposeful Availment + Minimal Contacts stands
P. + Publication both, very strong case
- Its an intentional torts case, combination of tort + constitutional law punitive damages can be recovered with intentional tort but not for
negligence tort, hence, Jones needs to show that Clader and Party were lying, it was an intentional tort.
the defendant publishing allegedly defamatory article about the California actress Im distributing it in California held as a deliberate
reaching into California.
- defendant may have sufficient contacts for the state to support minimum contacts just diction there even though she did not act within the state.
If a defendant coming select outside the state that she knows her cause harmful effects of it in the state, she may be subject to minimum context
jurisdiction there for claims arising out of that Act
CALDER EFFECTS: 1) committing an intentional act, 2) expressly aimed at forum state, 3) causing harm, the brunt of which is suffered
in forum state
Hypo Bomb TX CA (Explodes in NM enroute) yes, can sue in NM (Like shooting an arrow and somebody else coming in between
recklessness) Where activity is directed, where P lived, where it occurred?
Baltimore Case (note # 6) Trademark infringement (just because everything is happening in Baltimore, doesnt mean that it is not effecting IN)
Hypo: Can IU McKinney law student sue law professor for writing harmful LOR for job in CA NO, as some effects will aim at student and
law firm in CA, however, all activities centered in IN.
Keeton v. Hustler the defendant to purposefully availed itself to the opportunity to engage in In-state activities, by distributing its magazines
with interstate Pitch those contacts supported jurisdiction even though the defendants act had greater impact in other states, and the plaintiff a few
contacts with the forum state.
Rule: Personal jurisdiction is proper over a nonresident magazine in any state where that corporation has sold and
distributed a substantial number of copies.
Hustler purposefully availed itself of the privileges of doing business in New Hampshire, and should reasonably anticipated being haled into
court for claims related to the magazine it sells there. National publications may properly be sued for their content anywhere a substantial
number of copies are regularly sold and distributed. The ruling of the court of appeals is reversed, and the case is remanded.
Kulko v. Superior Court of California 1978 (142-144) [Sept. 20]
Stream of Commerce
Divorced couple, father lives in NY, mother lives in Cal. The kids live with the father but are unhappy, so he sends them to Cal to be with his
mother. Mother sues father for child support in Cal.
Supreme Court doesnt want to give jurisdiction to Cal., because it creates the wrong incentives. The father did a good thing, and it
would punish him if they let the mother adjudicate in California.
father did not purposefully avail himself of CA laws by sending daughter to livethere o Did send child support checks there, but that
was court-mandated (not voluntary)o Policy reasons of not wanting to discourage divorced parents from moving for fear of
jurisdiction
Burger King v. Rudzewicz
Burger King v. Rudzewicz 1985 (161-173) [Sept. 21]
Pennoyer Intl Shoe Hess McGee Burger King
Contract
Franchise buyers in Michigan get in a dispute with head office of BK. BK sues them for contract and tort damages s, subject of a suit in FL
even thought they never actually went to FL.
12
Nicastro v. J. McIntyre
Reconsidering stream of commerce J. McIntyre Machinery: defendant made a metal shearing machine in England and sold it to distributor in
the United States which resulted in New Jersey. The plaintiff was injured using it in New Jersey and sued there for his injuries. Majority held
that Contacts in New Jersey would not support the Specific in personam jurisdiction in New Jersey for nicastros claims. even though stronger
than Asahi, as defendant had reached out to sell his products in the United States, caused injury though indirectly in NJ not only knew that
his products were entering the US market but promoted that market. argument-purposefully availing to the United States but not to the states
where its products were resold. Majority opinion - jurisdiction may be proper if the defendant regularly serves in the market in the state where
its product causes injury. Manufacturing will not be subject to jurisdiction in another state Data distributor reasons the goods.
Two points: first, foreign manufacture selling credits to wholesalers outside United States without cultivating the US market-no jurisdiction.
Second, selling goods and encouraging sales, jurisdiction in the state fair dedicates good, that does a US distributor is located.
In conclusion purposeful availment must establish first after that other factors in determining whether the exercise of jurisdiction would
comport with fair play and substantial justice.
Hills Notes: Men(plurality) No Jurisdiction; Women (Dissenting all 3 women) Jurisdiction
Plurality its not the expectation/foreseeability but the action
- plurality talks about jurisdiction being everywhere in that case needs some sense of connection with the state.
Asahi
a manufacturer sells finished products to wholesaler outside the state, the wholesaler then resells to retailer in the forum state, and the retailer
resells to the consumer the party in the beginning of the stream of commerce did not import the production of the forum state itself, it sold to
others who did The manufacturer or component maker may or may not know or care about the Ultimate destination of product split court
in Asahi. OConnor mere awareness of product reaching the forum state through stream of commerce, not enough for purposeful availment.
Clear evidence required that the defendant seeks to serve the market in the particular state, suggest designing the product for the market in that
state or advertising there. Majority view: sending goods into the stream of commerce at least in substantial quantities constitutes purposeful
availment, even if original maker unaware or goods being sold there or cultivating customers.
- even if minimum contacts established, unreasonable to exercise jurisdiction on the unusual facts of the case.
Asahi Metal Indus. Co. v. Superior Court of California 1987 (145-154) [Sept. 20]
Pennoyer Intl Shoe Hess Grey Asahi
Tort
Tire valve built by Asahi (Japanese corp.) was faulty causing an accident in California. Asahi sold their product to other corp. that sold to
California. Their product was foreseaably going to the California market.
International company
Stream of Commerce
4 justices say no, 4 say yes, 1 says (in dicta) enough quantity
designing it for the forum state, advertising in forum state, providing advice to members of the forum state.
13
Shaffer v. Heithner: SCOTUS will use min. contacts in in personam context like in int. shoe. It was first case since pennoyer that
was quasi in rem. Reducing three categories to min. contacts. Even though in rem and quasi in rem contracts are being cont. used
as labels but behind them lies min. contacts.
There were 28 people out of which 21 got sued, who were stockholders and on that basis DE asserted jurisdiction. The other
seven did not have stock hence, weren't sued.
14
Justice Brennans dissent: P. is suing as the s ignored court order. The irony/real reason is that under DE law he can only sue
21. Its the ownership of the stock and not the things they did as officers that permitted quasi in rem jurisdiction.
Brennan things there were min. contacts because of the activities they engaged in as officers if the corporation. He thinks P.
should have been able to sue all 28.
They all agree that min. con. will now be the standard but other do not agree that there were min. contacts.
Hypo: Suppose P. lives in CA and wants to sue in CA court. lives in NY, has no business contacts but a million $ home in
San Fran. This is a $10 M. Suit.
Under Pennoyer can the be sued in CA? Yes, under Quasi in Rem for $1 M. Jurisdiction= value of property.
Under Shaffer? No Jurisdiction as no minimum contacts. Quasi in Rem J. goes away. P. will have to go to NY to sue him.
Hypo 2: Suppose the CA P. instead is renting his property of , whose guest ruins it. Can he sue him now in CA? Yes he can, as
the suit is related to property, now there is min. cont. He owns property and someone is injured on it, min. contacts.
Suppose P. has a $10 M suit, but prop. is $1M, but because of min. contacts now it is in personam min. contacts and hence, P.
can go after all $10 M. Court call is Quasi in Rem 1, in Shaffer. Jurisdiction is related directly to the property. Prop. is not just
being used to pull the in.
Husband is arguing that he has no International Shoe minimum contacts with California, and so under Shaffer v.
Heitner he should not be allowed to be served.
Holding and Reasoning (Scalia, J.) -Yes. A non-resident party may be properly served with process
while temporarily visiting a state without violating due process. It is well established that states have
jurisdiction over non-residents who are physically present in the state, no matter how long that
individual plans to stay in the state. This rule has a long and continuing tradition of being enforced by
the courts, across jurisdictions. Burnham argues that he lacks the minimum contacts necessary for
the court to properly apply personal jurisdiction, but that is a perversion of the standard; indeed, the
minimum contacts standard was created for use in the absence of a partys physical presence in the
state, which is not necessary in this case, as Dennis was physically present in California when he was
served. For the same reason, Dennis cannot rely on the holding in Shaffer v. Heitner, which held that
a state lacks jurisdiction over an individual unless the lawsuit arises out of his activities in the state,
because the non-resident litigant in that case was an absent one, unlike Dennis. Justice Brennans
concurring opinion disregards the fact that this body of law is based in traditional notions of due
process, not fleeting or contemporary notions. Because Dennis was physically present in California
when he was served with process, the state properly asserted personal jurisdiction over him, and the
holding below is affirmed.
Concurrence (Brennan, J.) - A long history of enforcement of personal jurisdiction when a nonresident party is present in a state, while informative and persuasive, is not necessarily dispositive. It
does mean, however, that defendants have notice that they might be served if they enter a different
forum state. By entering the state, the defendant avails himself of the benefits made available by the
This is Pennoyer style Tagging someone when they are in state. [In Kulko case, court disagrees. Court says that in future people wont let
15
children visit other parent. This case is in the background here.] No minimum contacts following Kulko.
Why no min. contacts, since he was in CA and was seeing his kids? He was there for a business trip unrelated to family law issue. Incidentally did
see his kids, not enough to give CA court Jurisdiction, according to most members of court. Has he purposefully availed himself? Justice Brennan
is concurring but does thinks there are min. contacts. Brennan tries to distinguish it from Kulko.
All agree with the decision, fighting is for the rationale. Scalia is a textualist : interpreting the due process clause. Thinks jurisdiction is fair on
basis of Pennoyer.
Brennan says there are minimum contacts. Also, if you don't have min. contacts than jurisdiction is not appropriate with due process clause.
What test should be used to determine the due process clause?
Test: Scalia for Textualist, Due Process, Ultimate conservative; Brennan for minimum contacts; Other two Judges who are moderates. On exam
talk about all of these.
Scalia: Theory of Textualism, in this case Due Process Clause, its meaning has to comport with what most people associate its meaning with and
not when it first came of in 1800s. According to textualist approach its illegitimate to take a clause that originally meant something else and
apply it today For him the meaning of constitutional causes is locked in time. Judges should do best to historically understand the meaning
when it was ratified.
Brennan its evolving according to changing social attitudes. We live in modern times, the court has to be practical. Court has the authority to
improvise.
After this case we can serve someone in the state without minimum contacts but not fraudulent cases. Presence in the jurisdiction
without min. contacts is going to be enough. Vestiges of Pennoyer continue to persist.
Theory of Acquiescence: If something has been accepted constitutionally for a long time, the court frequently says its hard to say how it is not
fair as it goes back so many years and we are not ready to throw it out.
This case is not about min. contacts but whether you are in the state.
16
Specific Jurisdiction: there has to be a connection, a minimum contact. s activity in the state have to be the basis for jurisdiction in
that state.
General Jurisdiction: when specific jurisdiction fails but lives in the forum state, hence, can be sued there. has to reside there as an
individual or as a business.
J VENUE
Venue is determined by 1391, which gives the rules where a federal action may be brought (either under diversity or a federal
question). Venue acts as a funnel, limiting the places where a case can be brought.
For diversity, 1391 says that venue is had where:
1. everybody resides if they reside in the same state, or
2. a substantial part of the event occurred
3. any defendant is subject to personal jurisdiction, if you cant get them under the first two.
For an action not based totally on diversity, venue is had where:
1. everybody resides if they all reside in the same state, or
2. a substantial part of the event occurred.
3. any defendant may be found., if you cant get them under the first two.
Corporations reside everywhere there is in personam jurisdiction over them.
Individuals reside in one state only.
may be found means actual presence, not just amenable to jurisdiction.
The structure of the statute
Part (b) deals with not-diversity, or federal question-type cases. Part (c) is a special provision for corporate defendants.
Hills Notes:
related to venue changed in 1990 and 2011.
Why do we need venue? Why separate requirement? Why is it above personal jurisdiction? Venue: for courts convenience, s too.
Because PJ can be over a in more than one place as there are min. contacts over more than one place. Venue statute is 1391 (amended again
2011).
1391 b: gives basic requirements of venue.
17
b1: Relevant in any district in which a lives if all s live in the same state.
b2: contemplating the convenience the ,
1391 b2: deals with the events of the case. Where does the substantial part of the events to. prop. etc is appropriate for venue.
VENUE is district by district and not state by state.
b3: fall back position when there is no venue and pj.
Difference between diversity and fed question before the amendment but more similar now.
1391c: where people are, where are they domiciled, same test as Mass v. Perry.
Corporations, business under c too. Very loose provisions.
Hypo: P. sues two brothers (B1, B2) in breach of contract.
P: IN wants to sue in IN
B1: IN
B2: IL
Can P. bring the suit in a district in IN? You can bring suit in any district in which lives if all s live in same state. For B2 bring suit under
b(2)
Venue requirements apply in federal court and not the state court.
If P. buys a vehicle from ford in southern district of NY, has his breaks fixed in Western Dist. of NY. Accident occurs in NJ.
Fords venue? look at c, its not limited.
For venue principle place of business is not needed for corporation, personal jurisdiction is enough.
Wants to sue break shop and ford in southern district? Yes he can as all s in NY, ford is subject to PJ.
Can he sue in NJ? Yes, he can under b2, accident is substantial part of the event.
Personal Jurisdiction: Venue enough.
Bates v. C & S - Debtor lived in west.d. of Penn, moves to w.d. of NY C&S debt collection agency, business only in Penn.
Fed. Q. Act: Unfair debt collection act Debtor wants to sue under this. This act gives protection if someone harasses you for
collection.
He sues in NY, C&S raise the venue issue You cant bring under b1. P. brings it under b2
Everything occurred in Penn, letter was sent from Penn to Penn, even when forwarded it wasn't from P.
So no substance in NY but court says it was a substantial portion. Amendments to it make the lang. loose.
There was no PJ over C&S, there was no aiming at NY, letter going to NY was incidental. It falls under Calder v. Jones.
There are certain timing issues If you don't claim PJ you waive the objection, C&S got into the venue thing.
After this case, talk about the language of b2The substantial portion language in b2 is pretty loose.
the action was brought in the right place, but there is a more convenient forum to bring it. The substantive law and procedural rules
travel with the transfer.
Can only be transferred to a court in which you could bring it on the day the action was filed under either in personam or venue rules.
1406 - The action was brought in the wrong place (no in personam, wrong venue), but there is a right place. None of the law travels.
When a plaintiff brings a change of venue motion the law works the same as if the defendant brought the motion:
18
To get to the fed ct. fed q/diversity = S M Jurisdiction, over the case, applies to fed. court
PJ = J over the parties, mainly Piper case deals with : SMJ, PJ, VENUE
PJ , same rule applies in state or federal court.
Exam: go through SMJ, PJ, Venue issues and decide. Think like an attorney, where do you want to go?
Venue is a district by district analysis whereas PJ is state by state Piper: venue and forum non-conveniens (FNC is related to venue)
Negligence or products liability are mostly tort cases, American tort law very lenient hence, popular When it comes to plaintiffs, America:
Better products liability, strict liability, law more favorable, punitive damages are betterCalifornia: very liberal tort laws hence makes CA very
attractive
- US laws more liberal than Scotland Plaintiffs are forum shopping in a big way.
Federal Question: Federal law applies; Diversity Cases: state law applies
Piper: Why California? No body from United States, decedents including pilot all from Scotland. CA has no real relation apart from the lawyer
who is in CA.
s have a three prong strategy, P files in state court CA, there is diversity here, but they decline to go to federal court, but s want to go to
federal court as once they go to Fed. Ct., they can transfer under 1404 a.
Whats the mechanism of getting into fed. ct. out of state court: they remove (removal) from CA fed court and, then seek transfer to PENN
Fed. Court then get it dismissed under forum non conveniens as more easily possible there.
CA fed. court decides that there is jurisdiction over Piper but not Hartzell, they lacked personal juris. over Hartzell, no min. contacts. Piper does
business in CA hence there is PJ over Piper. 1404 a permits transfer to PENN, if PENN would have jurisdiction over Hartzell, as they are
selling their propellers to Piper in Penn. Within the fed. system transfer is permitted from one state to another, even the case with no
jurisdiction as long as the receiving court has jurisdiction.
Doesn't work anymore, but here for our case, Reyno (from CA) was P. (today it will be people from Scotland).
Which law would apply? CA - No.
- Penn or Ohio, or Scotland.
Choice of law principles: each state has its own choice of law analysis. Only because you field suit in CA, doesn't mean those laws would apply,
other state laws may apply, decided by choice of law analysis.
CA no PJ over Hartzell, only Penn did hence, Penn choice of law principle had to be applied to decide what law would apply According
to district court of Penn, for Hartzell - Scottish law as there was where the accident occurred.
For Piper, CA had PJ, therefore CA choice of law, they said law will be applied of the place where the article was made, that was Penn But in
both these case, CA law wont apply in either case.
Was Venue proper against Hartzell and Piper? For corporation venue is where there is PJ No PJ over Hartzell, therefore, venue not appropriate
for Hartzell but only for Piper as there is personal jurisdiction.
Venue is a creature of federal court Piper might be selling directly to CA but not Hartzell, not directly targeting CA, hence no PJ over Piper.
Not enough of Nexus. If accident would have occurred in CA then under Grey, then also there would have been jurisdiction. Hence, this case if
different than Grey for Hartzell.
No Nexus to accident here in case of Hartzell.
Forum non conveniens has something to do with venue. Is it used when venue is proper or used when venue is not proper?
- It is proper when venue is proper. It is when the court says there is a proper place to do it. Footnotes p.919, factors list: Private
and Public FNC is discretionary.
Essence of these factors? There is this principle that the place where something occurs, the courts have to create an interest in deciding the issue.
Here all the decedents were Scottish. Public Factor: which court has the closest ties, greatest interest in being able to adjudicate this. If there are
local P.s who have been injured the forum of that place.
the efficiency and rights of the jurisdiction have to be kept in mind.
3rd Circuit dismissed because: 1. Scotland was going to be less favorable than U.S. (P.s might not get as much money), but SCOTUS
disagreed as even though they may be true, but Scottish law was most favorable. Even if the law is not as generous, there will be some
remedy.
P.s have a right to pick their own forum. But the court says, not as much here, why not? P. 923.
Preference is strongest when P.s want to pick their own forum the forum where case is being filed. For ex. if they had been from CA and
wanted to pick CA (as it was their own forum) but since they are picking it legally for being more attractive, hence doesn't matter All
this is called Forum Shopping.
Foreign P.s look for Nexus in U.S. hence flood of lawsuits here, because of generous laws.
19
3rd Circuit even change the choice of law analysis to make the case more favorable to make it stay in United States SCOTUS felt that 3rd
Circuit was way off.
FNC: discretionary doctrine used by courts to dismiss the case. Used when venue was otherwise technically proper. But in looking at
other factors the court says that it really is not the best place for the case to be held.
Decision is made by looking at factors in footnote 6. Also, which city or country has the greatest interest in adjudicating their claims.
Factors: where the evidence is? plane crash in Scotland. Nothing happened in CA, no evidence there.
A.
B.
What cuts against dismissing? P.s have picked the forum but court says, more credit would have been given had they picked their own forum
This was time where FQJ was already growing. Overflowing with litigation. Opening them to foreign litigation was a difficult situation for them.
P.s were forum shopping in a big way.
Why CA? P.s attorney lived and great place for tort law. Principle of P. picking its own forum doesn't get much weight when forum
shopping is going on.
20
Part III
Choosing the law to be applied THE ERIE PROBLEM
Exam Review: Identify whether the issue is like hanna or shady grove, is there a federal rule or like byrd, with just a federal policy If policy - 3
parts of balancing test will be waived, dont worry about fed. rules.
If fed. rule on point: is there really a conflict, Scalia says conflict as there is an addition. Ginsberg says no conflict.
II step: abridge, enlarge or modify
Is Shady rule: substantive state right?
RDA (Rules Decision Act) -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 decisions in civil actions in the
courts of the United States, in cases where they apply.
Erie Doctrine When a federal court is sitting in diversity, state law applies
Diversity (substantive law of a state) Quasi Procedural Procedural (federal courts have their own even when applying state law)
- Between substance and process there are quasi procedural rules such as SOL and there are therefore issues as to whether federal/state laws
should apply to these issues.
Latches stops a SOL from running Quasi Procedural
- Fairness issue in forum shopping.
In Swift v. Tyson, contracts past consideration case, is pre-existing debt past consideration? Fed Law Yes; NY Law No
Story says, common law doctrine applies federal courts need only apply state legislative law -- 34 RDA only applies to these laws
- Common law simply evidence of law, not law
Erie case: Common law applies
- Here, federal law more lenient towards plaintiff, PA Law Less Lenient
Cab Case clear manipulation of rules to take advantage of more favorable federal rule A company reincorporates to create diversity
Erie rules Swift as unconstitutional declares, common law + statutory law must be applied by a federal court in diversity
limits vertical forum shopping (state and federal); horizontal shopping, still ok (State A or State B)
- can one get into a state of more favorable laws.
the same court sitting in div. should not only use but state common law as well.
York Pushes Erie further
Because of forum shopping, fed ct. sitting in diversity have to go as far as possible from preventing any
differences ODT If the difference between state and fed. courts can be outcome determinative
then state rule should be followed.
- Before Erie, there was a gap, but now we are aligning Fed and State. Not just statute but the common law of state as well.
York says, behind Erie, there was a concern about forum shopping. If the difference between state and federal law is outcome
determinative, then State court rule will have to be followed a closely as possible. Erie said we will have to follow state common
law
1
Quasi Proc. Rules - can be outcome det. too.
2
York tried to stick to state laws as closely as possible (Erie on Steroids)
York set up a conflict, fed and state rules may differ.
Swift Statutes
Erie Statutes + Common Law
York Statutes + Common Law + ODT for quasi procedural
Ragan - If we apply the outcome-determinative test to this case, the outcome will definitely be affected if we use federal
instead of state rules. Do we follow the state rule in this case? According to York, we must, and thats what the Supreme
Court holds in Ragan.
Cohen - The federal rule has no bond. The New Jersey statute says you have to use a bond. Is this outcome-determinative?
Yes! Thus, the Supreme Court holds that New Jersey state law trumps FRCP Rule 23.1
Cohen : Fed. Rule 23 (this rule is how you bring class action).
State had a rule, before you can bring class action, Ps had to post a bond. Problem with that is, Fed. Rule 23 did not have that but state rule did,
hence, potential conflict, that could be outcome determinative. The state policy requiring bond is in state rule, to prevent strike suits. Based on
21
York, they look at it and decide in Cohen that rule 23 wont be applied the way not requiring bond, we will follow state procedure and bond will
be required. We will have to follow state rule to align state and fed. to prevent forum shopping. Fed. rules can very state to state.
Ragan : statute of limitations stops running under fed. rule 23 when we file the complaint in court. But under state law, statute keeps running
until the is served Court says, following the ODT, here we apply state rule.
Hannah says that if there is a conflict with federal and state rule, but federal rule is on point then federal rule should be
used. Hannah sides with the twin aims of erie: (1) Avoidance of forum shopping, (2) Avoidance of the inequitable
administration of the law.
RDA (a section of fed , when sitting in state, follow the substantive law) follow the substantive law Erie, York, Byrd
REA ( by which congress gives power to supreme court, the governing in Hannah) Applies to federal rules of civil procedure
REA: In a court when we have a fed. rule on Pt. we have the REA - where it says follows federal law unless it larges, abridges
or modifies a substantive law of state, or does something unconstitutional. REA tracks RDA
- Erie involves Quasi Proc. not governed by the REA.
22
Harlen says, this case seems to bend all procedural issues towards fed. rules.
Harlen - concerned with protecting sphere of state authority.
Scalia is channeling Warren in Shady Grove. - when you are in fed. ct. follow fed. rule. Interpreting Fed. Rule more broadly.
going back to Ragan and Cohen
Why does state says that SOL keeps running until is served?
If he files the complain he still doesn't know if he is off the hook, it is a way of assuring the .
Would justice Warren overrule Ragan?
How about Harlen? Does he think that they should follow fed. rule in Ragan? Yes he does.
Coehn : in addition to Rule 23, if you have to bring strike suit, you have to post a bond on the state rule.
Did Harlen follow fed. rule or would follow state rule?
Harlen would have followed the state rule, he argued the case for the .
The requirement of a bond is imp. state policy to discourage strike suits.
Harlen agrees with Ragan being overruled but not Cohen. Rule in Cohen, substantive state policy, we should be sensitive to that. Its not
that we disregard federal rule.
Ragan and Cohen both tilt is towards the state, not follow the fed. rule, Warren says follow fed. rule, Harlen comes back and splits the
difference.
Harlen : states have the authority to pass these primary rules. Its not about procedure but to create a substantive policy that should
be respected.
Walker v. Armco,
NY has a rule for service of process that says: serve first and then file in court, statute of limitations rule says an action is commenced
when the person is served. Federal court has a rule that says: file first and then serve, statute of limitations says an action is
commenced when the papers are filed Rule 3 of the Federal Rules of Civil Procedure. In diversity case, P files first and the service
gets lost behind the radiator and D isnt served within the statute of limitations.
1
(it is like Ragan) : Same conflict. State says SOL keeps running until person served, fed. rule, only until complaint
filed.
2
Ragan said follow the state rule and so does Walker.
3
Hannah seems to suggest, Ragan bad law but Walker disagrees, says Ragan good law.
4
Why did the court follow the state rule here? Court says no direct conflict between Fed. and State law. Hence, state
law is followed.
5
Walker reaffirms Ragan When isnt a conflict, follow state rule.
6
If you can't find a way out of the conflict then go to the REA, abridge, enlarge..line.
23
APPLICATION TEST
1.
Is a federal rule (arguably) on point?
a.
If no, ---- Byrd
If a case with Fed. Procedure, do the Byrd balancing formula: Fed. Int., State Int, Litigants interest in avoiding ODT, to avoid
forum shopping. (This third factor weighs in favor of state interest. By following state rule, you are minimizing difference
between fed. and state rule.)
Byrd is a good example of what we do when a conflict btw fed. policy and state policy
2.
If yes, does the fed. Rule (FCRP, FRAP) actually conflict with the state rule policy (Ragan, Cohen, Hanna, Plummer,
Burlington, Northern, walker v armco)
a.
These 6 cases with fed. rule on point. But is there really a conflict btw state and fed. rules, is there a way of avoiding
the conflict?
b.
In ragan and walker, the court used the state rule. Did they ignore the federal rule? No but narrowed it, found a way of
avoiding the conflict.
3.
If there is no conflict, use the state rule (i.e. supplement the fed rule with state rule/policy).
4.
If there is a conflict, the federal rule must be applied and the state rule disregarded.unless..
5.
Unless the federal rule abridges, enlarges or modifies (REA) a substantive rule/policy of the state.
Fed rule says judges have discretion, state rule says they do not in Burlington, conflict is unavoidable, we will have to follow fed
rule unless REA makes this allowance for state substantive law. In Burlington it is not a substantive rule/right (10% penalty), its
procedural. Therefore, no problem with REA definition issue
Shady Grove:
1.
Conflict between rule 23 and NY Law which prohibits class actions is suits seeking penalties or statutory minimum
damages.
Good claim made and to be given compensation within 30 days, if not then penalty but NY says not as a class action under
901 (b). $500 penalty amplified to multi-million $ class action is unfair, NY felt.
RULE 23 doesnt have this. If you meet 4 requirements, you can bring class action. State law doesnt agree and that is the
conflict.
Scalia: Likes bright line laws. Favors federal law, following Hannah and following Justice warrens opinion on Hannah.
Says there is a direct conflict. Between New York Law and Fed Law. Rule doesnt have an additional requirement, we will follow the
fed law.
Ginsberg : No direct conflict. Why? NY law has good substantive reasons like the Cohen case. This is an additional
procedural bound up with remedy. No direct conflict. Its bound up with substantive reasons. State feels unfair to overkill (All State)
Scalia: Channeling Warren: Not substantive, procedural, no problem under the enabling act. Not an Eerie Problem.
Ginsberg: Channeling Harlen.
For Ginsberg, still an Eerie problem.
Stevens: concurs with majority but takes Halen, Ginsberg approach.
Shady Grove is a lot like Hannah, follow the federal rule and ignore state rule, interpret fed rule very broadly
Burlington: Fed. rule but conflict
Rest all cases (above), state rule.
Mason v. American
Fed. Ct. sitting in div. has to apply substantive state law.
Mason case: how is that decided?
Legally binding supreme court precedent. If SCt. Precendent not available then lower ct. can be persuasive enough too.
Older rule that changed was never overruled by SCOTUS form 1928. They avoided the issue
This court says, there is a little bit of leeway.
What would the state supreme ct. do today even if there is this precedent going other way. This gives ct. leeway.
Holding: perfectly permissible for fed. ct. to have a leeway, fed. ct. can ignore it if they believe that state sup. Ct. will reach
a different result under some different rule today.
Notes: Fed, Ct. reaching the decision of state law, not binding on state. If fed. ct. makes a decision and circuit ct of appeals
affirms it, then it will be binding on lower cts. Unless the fed. ct. has evidence has state sup. Ct. will do something differently.
DICE v. AKRON
The converse erie problem: In erie fed ct sitting in div must apply state subs. law. Here State law applying federal rule.
But where a fed claim can be brought in state ct, state ct has to follow fed law and policy.
Section 1983 fed statute permitting a person to bring a tort like suit when a state officer has violated the constitutional
right, this section permits the victim to sue officer for violation of civil right. If goes into state ct, it will have to fully apply federal
law.
What if there are state defenses that might narrow fed law. Can it be done if congress wont do it otherwise?
In this case, release binding under state law, non-binding under federal law.
- Fed law has to be given full effect if congress disagrees with state law, state cannot limit fed law towards state tort defense in this
case.
- Who decides? Judge or Jury? Congress says you have to follow the fed law. Congress can require federal procedures to be followed.
24