Civ Pro Outline

Civil Procedure, Spring 2011 - Arkin
Table of Contents
PERSONAL JURISDICTION......................................................................................4
TYPES OF PERSONAL JURISDICTION....................................................................................4
PENNOYER V. NEFF............................................................................................................. 4
INTERNATIONAL SHOE: MINIMUM CONTACTS.....................................................................5
LONG ARM STATUTES: STATES & MINIMUM CONTACTS.......................................................6
SHAFFER v. HEITNER: s PROPERTY IN THE FORUM..........................................................6
WORLDWIDE VOLKSWAGEN CORP. v. WOODSON: REFINING MINIMUM CONTACTS.............6
BURGER KING v. RUDZEWICZ............................................................................................. 7
STREAM OF COMMERCE..................................................................................................... 8
EFFECTS TEST.................................................................................................................... 8
BURNHAM V. SUPERIOR COURT: RETURN TO TERRITORIALISM...........................................8
INSURANCE CORP. v. COMPANIE DES BAUXITES: CONSENT AS A BASIS.............................9
GENERAL JURISDICTION THEORY........................................................................................ 9
INTERNET CONTACTS....................................................................................................... 10
GLOBAL REACH OF PERSONAL JURISDICTION...................................................................10
CHALLENGING PERSONAL JURISDICTION..........................................................................10
NOTICE...............................................................................................................11
MULLANE V. CENTRAL HANOVER BANK: NOTICE TO .....................................................11
SERVICE OF PROCESS....................................................................................................... 11
METHODS OF SERVICE OF PROCESS ON INDIVIDUALS.....................................................11
WAIVER OF FORMAL SERVICE........................................................................................... 12
METHODS OF SERVICE OF PROCESS ON CORPORATIONS & ASSOCIATIONS.....................12
GEOGRAPHIC RESTRICTIONS ON SERVICE OF PROCESS IN THE U.S.................................12
VENUE - 1391, 1404, 1406...............................................................................12
GENERAL PRINCIPLES....................................................................................................... 12
LOCAL & TRANSITORY ACTIONS........................................................................................ 13
1391 VENUE FOR TRANSITORY ACTIONS IN FEDERAL COURT......................................13
TRANSFER........................................................................................................................ 13
FORUM NON CONVENIENS...................................................................................14
PIPER AIRCRAFT V. REYNO................................................................................................ 14
SUBJECT MATTER JURISIDICTION..........................................................................15
DIVERSITY OF CITIZENSHIP 28 U.S.C. 1332; 28 U.S.C. 1369..........................................15
FEDERAL QUESTIONS: 28 U.S.C. 1331.............................................................................. 17
REMOVAL - 1441, 1446, 1447...........................................................................19
PROCEDURAL ISSUES....................................................................................................... 19
ISSUES OF JURISDICTION & VENUE................................................................................... 20
III. DEFINING THE DISPUTE: PLEADINGS.......................................................22
PLAINTIFFS SIDE OF THE STORY: THE COMPLAINT................................................22

BASIC PRINCIPLES............................................................................................................ 22
SPECIFICITY, CONSISTENCY, & HONESTY IN PLEADING....................................................23
LEGAL SUFFICIENCY......................................................................................................... 23
HEIGHTENED SPECIFICITY................................................................................................ 24
STRANGE CAREER OF RULE 8(a)(2).................................................................................. 24
RULE 11 SANCTIONS........................................................................................................ 25
DEFENDANTS RESPONSE....................................................................................26
PRE-ANSWER MOTIONS UNDER RULE 12..........................................................................26
FAILURE TO ANSWER DEFAULT UNDER RULE 55............................................................28
ANSWER........................................................................................................................... 29

VOLUNTARY DISMISSAL RULE 41(a)...............................................................................29
AMENDED & SUPPLEMENTAL PLEADINGS..............................................................30
AMENDMENTS OF RIGHT & LEAVE TO AMEND RULE 15(a).............................................30
RELATION BACK OF AMENDMENTS (AMENDMENTS & STATUTE OF LIMITATIONS..............30
IV. PARTIES AND CLAIMS: ESTABLISHING THE SIZE AND STRUCTURE OF THE
DISPUTE..................................................................................................... 32
JOINDER OF CLAIMS & PERMISSIVE JOINDER.........................................................32

PERMISSIVE JOINDER OF CLAIMS RULE 18.....................................................................32
PERMISSIVE JOINDER OF PARTIES RULE 20....................................................................32
IMPLEADER/THIRD PARTY PRACTICE RULE 14......................................................33
PROCEDURAL & POLICY ISSUES........................................................................................ 33
JURISDICTIONAL & RELATED ISSUES.................................................................................34
COUNTERCLAIMS AND CROSS-CLAIMS RULE 13...................................................35
COMPULSORY COUNTERCLAIMS 13(a)...........................................................................35
PERMISSIVE COUNTERCLAIMS 13(b)..............................................................................35
CROSS-CLAIMS 13(g)..................................................................................................... 35
INTERPLEADER RULE 22 AND 28 U.S.C.A. 1335...................................................35
INTERPLEADER................................................................................................................. 35
SCOPE OF INTERPLEADER................................................................................................ 36
PROCEDURE OF INTERPLEADER....................................................................................... 36
RULE INTERPLEADER RULE 22....................................................................................... 36
STATUTORY INTERPLEADER 28 U.S.C.A. 1335..............................................................36
INTERVENTION RULE 24....................................................................................37
INTERVENTION OF RIGHT 24(a)..................................................................................... 37
PERMISSIVE INTERVENTION 24(b)..................................................................................37
PROCEDURE & TIMING...................................................................................................... 38
JURISDICTIONAL & RELATED ISSUES.................................................................................38
COMPULSORY JOINDER OF PARTIES RULE 19.......................................................38
THREE-STEP ANALYSIS...................................................................................................... 38
REQUIRED (NECESSARY) PARTIES.............................................................................. 38
FEASIBLE PARTIES............................................................................................................ 39
INDISPENSABLE PARTIES............................................................................................... 40
PROCEDURE & POLICY...................................................................................................... 40
CLASS ACTIONS RULE 23 AND 28 U.S.C. 1332(d) CAFA........................................40
DUE PROCESS HOW CAN CLASS MEMEBRS BE BOUND BY A JUDGMENT?......................41
RULE 23(a) - REQUIREMENTS OF ANY CLASS ACTION......................................................42
RULE 23(b) TYPES OF CLASS ACTIONS...........................................................................42
NOTIFICATION TO CLASS MEMBERS AND OPTING OUT..................................................43
FILING & CERTIFICATION OF A CLASS ACTION UNDER RULE 23........................................44
JURISDICTION IN CLASS ACTIONS..................................................................................... 44
JUDGMENTS, SETTLEMENTS, & DISMISSALS.....................................................................45
SUPPLEMENTAL JURISDICTION.............................................................................45
UNITED MINE WORKERS v. GIBBS..................................................................................... 45
FINLEY v. UNITED STATES................................................................................................. 46
POLICY JUSTIFICATIONS.................................................................................................... 46
1367............................................................................................................................... 46
V. WHAT LAW APPLIES IN FEDERAL COURT: OF THE ERIE DOCTRINE AND

DIVERSITY JURISDICTION............................................................................. 47
2

STATE LAW IN DIVERSITY ACTIONS THE PROBLEMS PRESENTED BY ERIE..............47
BASIC/BACKGROUND PRINCIPLES..................................................................................... 47
MODERN EFFORTS TO ENUNCIATE A WORKABLE TEST...........................................49
CONTEMPORARY PRINCIPLES............................................................................................ 49
APPLYING HANNA.............................................................................................................. 50
ERIE & HORIZONTAL CHOICE OF LAW............................................................................... 51
VI. THE EFFECT OF PRIOR ADJUDICATIONS: RES JUDICATA (CLAIM PRECLUSION)

AND COLLATERAL ESTOPPEL (ISSUE PRECLUSION)........................................52
CLAIM PRECLUSION.............................................................................................52
EXCEPTIONS TO THE OPERATION OF CLAIM PRECLUSION.................................................53
PRECLUSION IN STATE-FEDERAL COURT ADJUDICATIONS (1738 - FULL FAITH &
CREDIT).............................................................................................................. 54
ISSUE PRECLUSION/COLLATERAL ESTOPPEL..........................................................55
EXCEPTIONS..................................................................................................................... 56
MUTUALITY OF ESTOPPEL....................................................................................56
INTRODUCTION................................................................................................................ 56
NON-MUTUAL DEFENSIVE ISSUE PRECLUSION..................................................................56
NON-MUTUAL OFFENSIVE ISSUE PRECLUSION..................................................................57
COLLATERAL ATTACK ON CLASS ACTION JUDGMENTS.............................................57
VII. SUMMARY JUDGMENT (JUDGMENT AS A MATTER OF LAW): ADJUDICATION

BEFORE TRIAL............................................................................................ 58
II. CHOOSING THE FORUM: ISSUES OF PERSONAL

JURISDICTION & SUBJECT MATTER JURISDICTION IN THE
FEDERAL COURTS
PERSONAL JURISDICTION
TYPES OF PERSONAL JURISDICTION
-
In personam: exercised over the herself, because there is some appropriate

connection with the forum. Judgment creates a personal obligation a debt that the is
entitled to recover from the .
o Entitled to full faith and credit.
o s property may be seized in order to enforce the judgment.
In rem: involves a dispute over ownership of the property that is the jurisdictional
predicate and purports to determine the ownership interest in that thing as to every
person in the world.
Quasi in rem 1: adjudicates the ownership of the property that is the jurisdictional
predicate, and purport to determine that ownership as between and among the parties to
the case
o Quite similar to true in rem, but judgment does not bind the whole world.
Quasi in rem 2: no dispute over who owns the property; property is relevant as a
jurisdictional predicate only because the cannot obtain in personam jurisdiction over the
.
o Judgments made quasi-in rem do not create a personal obligation rather it is valid
only to the extent of the property that served as the jurisdictional predicate.
SPECIFIC JURISDICTION: jurisdiction created only for a claim that arises from activity
within the forum.
GENERAL JURISDICTION: under which a can be sued in the forum for a claim that
arose anywhere in the world.
PENNOYER V. NEFF
Principle: A person is not bound by a judgment unless the court properly acquired power
over that person; a courts power is limited by territorial boundaries.
Precise Holding: Oregon state court lacked p/j because it failed to seize Neffs land, the
jurisdictional predicate, at the outset of the litigation, violating statutory and constitutional
provisions of full faith and credit. Thus, the initial ruling was a void judgment, and was not
entitled to full faith and credit in the subsequent case.
o Due Process: opinion made clear that the constitutional propriety of p/j is judged
by principles of due process, and the due process assessment determines whether
the judgment is entitled to full faith and credit (i.e. if a court lacks p/j, its judgment
would deny litigants of due process).
o Sovereignty & Territorial Boundaries: states possess exclusive jurisdiction and
sovereignty over persons and property within its territory, and no state can exercise
direct jurisdiction and authority over persons or property outside its territory.
Physical Power: over people and things inside its boundaries which is
limited by concepts of due process and full faith and credit.
Summary of Bases of Jurisdiction under Pennoyer
Consent: a can be subject to in personam jurisdiction if she appears in the

court may be voluntary, or by mistake (i.e. failing to object appropriately to an
exercise of jxn)
Residence: states may exercise in personam jxn over residents
Presence: a state has in personam jxn over a found within the state i.e.
must be served with process while present in the forum.
Agent for service of process: for nonresidents entering into partnerships,
associations, etc. within its limits, or making contracts enforceable there
NOTICE: Constitution also requires that the be given notice and an opportunity to
defend herself in the forum consists of process, which is a copy of the complaint and
summons (the document symbolizing the courts exercise of power over the )\
o Under Pennoyer, the only way to give notice was to effect personal service of
process.
EXPANSION OF PENNOYER Use of Legal Fictions to Expand Personal Jurisdiction

o Harris v. Balk: allowed attachment of intangible property, i.e. a debt by means of
a debtor
o Hess v. Pawloski: Court upheld MA statute providing that by operating a motor
vehicle in MA, the nonresident had consented to jurisdiction in MA and to the
appointment of a MA state official as an agent for service of process (so long as
served process on the state official and that a copy was sent to the nonresident at
his residence)
Jurisdictional predicate is consent and the notice consists of service of
process within the forum on the s agent.
o Milliken v. Meyer: Court upheld personal jurisdiction based on s domicile in the
forum; even though the domicilary was not personally served with process in the
forum.
Set up foundation for in personam jurisdiction based on other forms of notice,
and for the possibility that process can cross state lines.
Domicile: the state in which a person is present that she intends to make
her permanent home is retained until a new domicile is acquired.
INTERNATIONAL SHOE: MINIMUM CONTACTS
Principle: to subject a to a judgment in personam, if he be not present within

the territory of the forum (Pennoyer), he have certain minimum contacts with it
such that the maintenance of the suit does not offend traditional notions of fair
play & substantial justice.
o Includes an estimate of the inconvenicies the would face in litigating away from
home.
Rationale: reciprocity to the extent that a corporation exercises the privilege of
conducting activities within a state, it enjoys the benefits and protection of the laws of that
state.
o If a company or individual gets the benefits of a state, then it should expect to be
subject to the power of that states courts.
Shift from power, sovereignty, and territorial boundaries (Pennoyer) to concerns of fair
play, reasonableness, and convenience.
Justice Black Concurrence: espoused concerns about the vague Constitutional criteria
and uncertain elements, and that this would be used to limit the ability of a state to
exercise in personam jurisdiction. However, International Shoe has been applied BROADLY.
Test: model assesses two variables: (1) the level of activity of the in the forum and (2)
whether the claim asserted against the is related to the s activites in the forum.
NO
MAYBE
has limited contact with the

forum and the claim does not arise
from that activity in the forum.
has continuous & systematic

activities in the forum but is sued on a
claim unrelated
-General jurisdiction if
substantial contacts-
MAYBE
YES
has casual contact with the

forum, and is sued on a claim
arising from that contact.
-Specific jxn if purposeful
availment & reasonableness
reqmts satisfied-
has continuous & systematic

activities in the forum & claim arose
from those activities.
-Specific jurisdiction-
Unrelated
NATURE OF CONTACTS
Related
Casual (isolated and sporadic) Continuous and systematic
LEVEL OF ACTIVITY
McGee v. International Life: CA resident purchased a life insurance K from AZ company,

which was subsequently acquired by a TX corporation; mailed a certificate of reinsurance to
the Insured who continued to pay his premiums; corporation refused to pay the claim when
the policys beneficiary attempted to collect.
o Minimum contacts satisfied: CA had in personam jurisdiction over the TX
corporation, even though their only contact with CA was this single insurance policy
o Relatedness: Suit was based on a contract which had substantial connection with the
forum.
o State interest: CA had a compelling state interest in providing effective means of
redress for its residents. (evidenced by statutes aimed at insurance regulation)
o Inconveniences: Balance of inconveniences favored allowing to sue in CA.
Hanson v. Denckla: PA widow set up a trust in DE with a DE bank; later moved to FL and
received periodic interest payments. Estate was probated in FL and litigation ensued was
the DE bank subject to inpersonam jurisdiction in FL?
o NO minimum contacts
o Purposeful Availment: to have a relevant contact under minimum contacts, the
must have purposefully availed itself of the privilege of conducting activities within
the forum sate, thus invoking the benefits and protections of its laws
Moving to FL was a unilateral activity FL lacked jurisdiction over the DE bank
because the bank had done nothing to avail itself of the privilege of conducting
activities in FL.
o Distinguished from McGee: DE bank did nothing to reach out to FL in the way the TX
insurance company reached out to CA.
LONG ARM STATUTES: STATES & MINIMUM CONTACTS
General approach: provides that the courts of the state can exercise jurisdiction over a
nonresident ot the full extent of the Constitution; then statutory analysis is coextensive
with constitutional assessment.
Laundry-list statute: contains a list of activities that subject a nonresident to in

personam jurisdiction.
Statutory analysis for in rem and quasi in rem: usually an attachment statute may
be used in a case in which in personam jurisdiction is impossible because the courts have
interpreted the long-arm statute narrowly If the long-arm statute does not apply, and thus
in personam jurisdiction is not possible, but the nonetheless has sufficient contacts with
the forum, the should try QIR-2 jurisdiction (assuming that there is property in the forum
that can be attached at the outset as the jurisdictional predicate).
SHAFFER v. HEITNER: s PROPERTY IN THE FORUM
Facts: shareholder of Greyhound Corp. brought a derivative suit against directors for
breach of fiduciary duty resulting in a loss of $12 million; attempted to exercise QIR-2
jurisdiction over the directors by asking the court to attach the shares of stock held by
the s in Greyhound. DE court upheld jurisdiction over the s based on a state statute
providing that the ownership interest represented by stock in a DE corporation was
present in DE.
Holding: Supreme Court rejected use of QIR-2 jurisidiction. DE could not have jurisdiction
simply by seizing property owned by the s in DE needed to be a showing that the s
contacts with DE satisfy International Shoe.
Rationale: DE has an interest in policing whether directors of DE corporations perform
their fiduciary duties in accordance with state law, but DE had based jurisdiction on
ownership of stock, which has no necessary correlation with being a director, as opposed
to fiduciary capacity.
Unclear if the Court determined that International Shoe supplanted Pennoyer, or whether
the two coexist.
In-rem and quasi-in-rem cases relevant inquiry is no longer simply whether the property
serving as the jurisdictional predicate is attached at the outset, but, instead, whether the
has such minimum contacts with the forum that the exercise of jurisdiction would not
offended traditional notions of fair play and substantial justice.
Presence of property in the forum probably satisfies minimum contacts.
o When claims to the property itself are the source of the underlying controversy, it
would be unusual for the State where the property is located not to have jurisdiction
(in-rem and QIR-1)
o s claim to the property would indicate that she expected to benefit from the
states protection of the interest, therefore the state would have a strong interest in
assuring that the the property is marketable and that the dispute is resolved
peacefully.
o Relevant evidence and witnesses will be present in the form
Clearly overrules Harris v. Balk and the part of Pennoyer that would uphold QIR-2
jurisdiction simply on the basis of seizure of property at the outset
Rule of Law: Presence of the property by itself will generally satisfy the standard in rem
and QIR-1 cases, in QIR-2 cases in which the property caused the injury suffered by the ,
and in cases involving status.
WORLDWIDE VOLKSWAGEN CORP. v. WOODSON: REFINING MINIMUM

CONTACTS
Facts: Injured persons sued in OK state court theorizing that the gas tank of the car was
positioned unsafely in a way that led to the explosion when the car was hit from the rear.
Issue: Are the regional distributor (Worldwide) and the dealer that sold the car (Seaway)
subject to personal jurisdiction in Oklahoma?
Rationale: No s had no relevant contact with OK because they did not purposefully
avail themselves of any benefit in OK.
Purposeful availment: s did not sell or service cars in OK, did not solicit
business or have salespeople in OK, did not regularly sell cars to OK residents or
seek to serve the OK market
Unilateral activity: s drove the car to OK; the s did not reach out to OK.
Foreseeability: Court conceded that it is foreseeable that the car would get to OK,
but tat sort of foreseeability is irrelevant. It must be foreseeable that the s
conduct and connection with the forum state are such that he should reasonably
anticipate being haled into court there. CIRCULAR REASONING.
Purposes of Minimum Contacts: (1) Protects s from litigation in an unduly

burdensome forum, and (2) Ensures that states (through their courts) do not impinge upon
the sovereignty of other states by overreaching their own jurisdictional power.
Fair play and substantial justice: meant to protect the from litigation in an
inappropriate forum.
Contact: between the and the forum protects against the usurpation of power
by one state over another.
FAIRNESS FACTORS
1. Burden on the defendant
2. Forums state interest in adjudicating the dispute (McGee)
3. s interest in obtaining convenient an effective relief
4. The interstate judicial systems interest in obtaining the most efficient resolution of
controversies
5. Shared interest of the several states in furthering fundamental substantive social
policies.
Only relevant after the Court finds a relevant contact
Kulko v. Superior Court: NY couple divorced in NY; husband remained in NY with two
children, and wife moved to CA. Father agreed to let the children move to CA and bought a
plane ticket for one. Mother then sued the father in CA for child support.
o Not subject to personal jurisdiction: sending the child to that state did not
constitute a sufficient contact to support jurisdiction, even for a claim of child
support father had not purposefully availed himself of the benefits and
protections of CA.
o Substantive social policy: Permitting suit against the father in CA would
discourage parents from accommodating the interest of family harmony.
BURGER KING v. RUDZEWICZ
Facts: s in Michigan entered a franchise agreement with BK corporation, and BK sued in

FL for breach of contract; personal jurisdiction upheld over the s in FL
Contact: relevant contact between the and the forum state, resulting from the s
purposeful availment, such that the could foresee being sued there reached out to
FL to negotiate a massive contract with a FL entity; operation was controlled by corporate
headquarters in FL; contract contained choice of law provision stipulating FL law
Fairness: burden is on the to demonstrate the unfairness of the forum; mere
inconvenience is not enough must show that the chosen forum is unconstitutional. Due
process does not guarantee the best forum or even a reasonably good one; simply
protects the against having to litigate in an unconstitutionally bad forum. Difficulty of
getting to FL was not an inconvenience of unconstitutional magnitude. Relative wealth of

parties was also not relevant.
Dissent: argued that the K was one of adhesion.
STREAM OF COMMERCE
Gray v. American Radiator & Standard Sanitary Corp: Court upheld jurisdiction over
IL manufacturer in OH; manufacturer had made valves to send to a PA water heater
company, who sold the finished product to Ohio.
Asahi:
OConnor stream-of-commerce-plus theory: merely putting a product into the
stream of commerce, even with the knowledge that it will get to the forum, is not
enough. Purposeful availment requires additional contact that indicates an intent or
purpose to serve the market in the forum state (designing the product for that
market, advertising, establishing channels for giving advice to consumers,
marketing through a distributor as a sales agent in the forum)
I.E. direct economic benefit, advertising in the forum, targeted product design
anything indicating a FOCUS on that market.
Brennan theory: so long as the places a product in the stream of commerce and
is aware that the final product is being marketed in the forum state, the possibility
of a lawsuit can come as no surprise. derives economic benefit from the retail
sales of the final products in the forum, so the litigation would not impose a burden
for which there is no benefit.
Pure stream-of-commerce view
s derive economic benefit from participating in an international economy
Fairness: severe burden on Asahi to defend thousands of miles away in the court of
a foreign country; only issue was whether Asahi owed Cheng Shin indemnity which
had nothing to do with road safety in CA; Cheng Shin not a CA resident, making the
states interest even more attenuated; as far as substantive social
policies/efficiency, Court found an interest in trying to keep American courts from
determining disputes between foreign corporations.
Court wary of forcing international companies to appear in the U.S.
economic policy issue
EFFECTS TEST
Keeton v. Hustler: NY citizen sued a magazine publisher in NH (because there was a

longer statute of limitations than any other state); Court upheld jurisdiction not only for a
claim of damage caused by publication, but also for injury suffered in any other state as a
result of the distribution of the magazine.
Social policy rationale: NH had a substantial interest in cooperating with other
States to provide a forum for efficiently litigating all issues and damages claims
arising out of a libel in a unitary proceeding.
Continuous and systematic, & Related
Calder v. Jones: Court upheld jurisdiction over the writer and editor of a tabloid story that
allegedly defamed Shirley Jones even though both worked in FL, Court held that they
could be sued in CA because they aimed their efforts at CA, where Jones lived and would
suffer the greatest harm.
Stands for the proposition that relevant contact between the and the forum can
be established not only by the s going to the forum and doing something there,
but by her intentionally causing an effect there.

BURNHAM V. SUPERIOR COURT: RETURN TO TERRITORIALISM
Facts: couple separated, wife moved to CA and they agreed that she would file for divorce
there, but husband filed for divorce in NJ. When he went on a business trip to CA and to
visit his kids, he was served with process in a CA action for divorce and monetary support.
Issue: does service of process within the forum give in personam jurisdiction, or does
jurisdiction have to be assessed under International Shoe? Does tag jurisdiction (or
transient jurisdiction) exist as an independent basis of in personam jurisdiction?
Scalia opinion: concluded that jurisdiction can be based on presence in the forum when
the is served with process without assessment of minimum contacts; based in some
measure on historical assessment, since the overwhelming majority of courts continued to
apply jurisdiction based on service in the forum.
Service in-state is not necessary to the exercise of in personam jurisdiction, but
certainly remains sufficient for it.
Universally-accepted practice in the past and universally understood now states
COULD disallow this practice and until they do it comports with traditional notions of
fair play and justice.
Brennan opinion: concluded that the historical pedigree of jurisdiction based on service
of process is not enough by itself to justify it asserted that Shaffer meant that all
exercises of personal jurisdiction (even those set forth in Pennoyer) must be assessed by
minimum contacts; accordingly, International Shoe displaced Pennoyer, and does not exist
alongside it.
Brennan says any transient avails herself of significant benefits provided by the
State, such as the health and safety protections afforded by the police and other
services, transient is free to travel in the state, and transient likely enjoys the fruits
of the states economy as well.
Seems to imply that a state can exercise general jurisdiction over anyone who has
spent a couple of days in the state, and that the benefits gained simply by being
there outweigh the burden of having to defend in the forum.
INSURANCE CORP. v. COMPANIE DES BAUXITES: CONSENT AS A BASIS
Principal Holding: was estopped from challenging jurisdiction because of

the s refusal to cooperate with jurisdictional discovery orders.
objects to jurisdiction in PA during discovery to determine personal jurisdiction,
refuses to comply with court orders to produce relevant documents.
Court says you could have just ignored the proceedings and defaulted, but instead you
chose to participate in the jurisdictional litigation
Consent by not utilizing its option of just staying home, and now has
forefeited its right to just ignore the court.
GENERAL JURISDICTION THEORY
Defined: s presence in the state is so solid that the courts of that state have power over
the without regard to where the claim arose.
Individuals general jurisdiction based on DOMICILE (Milliken v. Meyer)
Corporations
o Helicopteros Nacionales de Columbia v. Hall
Facts: representatives of 4 people killed in a helicopter crash in Peru sued a
Columbian corporation in TX. Contacts with TX were: (1) CEO visited TX to
negotiate a contract for the to provide transportation services (during
which the accident occurred); (2) received more than $5 million in
payments for the services through a TX bank; (3) bought more than $4
million worth of helicopters from a TX company which provided its
10
transportation services. Claim did not arise from the activities IN TX, so an
assertion of general jurisdiction was needed.
Holding: Conduct did not constitute continuous and systematic contacts
with TX. mainly engaged in purchasing products in the forum.
Take-away: if a company merely buys and sells a lot in a state, or
sends its employees there regularly to conduct business, that does
NOT give the state general jurisdiction over that company.
Perkins v. Beneguet Consolidated Mining
o Facts: D was a corporation formed under Philippine law, which continued to exist
while its mining operations in the Philippines were suspended. President, general
manager, and main shareholder set up office and accounts in Ohio, from which the
corporation paid salaries to personnel and other company experiences.
o Holding: Upheld personal jurisdiction in Ohio over a claim arising in the Philippines;
corporation conducted a continuous and systematic, but limited, part of its general
business in Ohio. Plus the president was served in the forum state while aciting in
his corporate officer capacity.
Discussion: in Perkins, the actual operation of the corporation was centered in the forum,
whereas in Helicopteros, engaged mainly in purchasing products in the forum.
Qualitative and quantitative assessment: perhaps measured in dollar value of
business, and perhaps measured by the percentage of business done in the forum.
Service of process in the forum: likely to support general in personam jurisdiction,
either because it historically always has or because of the Brennan conclusion that a
pretty minor contact supports it.
Domicile: also sufficient to support general jurisdiction.
INTERNET CONTACTS
Zippo Mfg. v. Zippo.com: website alone is not sufficient to support jurisdiction

propriety of jurisdiction depends on the location of the site on an
active/interactive/passive spectrum.
Passive no jurisdiction
Active jurisdiction
Interaction jurisdiction depends on degree of interactivity and commercial
nature of the website.
Ask: was the internet activity specifically aimed at the forum state?
GLOBAL REACH OF PERSONAL JURISDICTION
Goodyear Luxembourg Tires v. Brown (2009)

Whether a foreign corporation is subject to general personal jurisdiction, on
causes of action not arising out of or related to any contacts between it and the
forum state, merely because other entities distribute in the forum state products
initially placed in the stream of commerce by the corporation.
The lawsuit centers on an allegedly defective tire manufactured in Turkey and
involved in an auto accident in France. None of the events giving rise to the
accident occurred in the United States, and none of the defendantsthree tire
manufacturers operating in Luxembourg, Turkey, and Franceare citizens or
residents of the United States. These tire manufacturers took no affirmative
action to cause their tires to be distributed in North America, and the type of tire
involved in the accident is not distributed in the United States. Yet, despite the
absence of any meaningful connection between the three foreign tire companies
and the United States, plaintiffs sought to hale each of them into a North
Carolina state court.
11

The trial court denied the foreign affiliates' motion to dismiss for lack of personal
jurisdiction and the North Carolina Court of Appeals affirmed, concluding that the
defendants were subject to general personal jurisdiction in North Carolina
because they purposefully injected their product into the stream of commerce
without any indication that they desired to exclude that state from distribution.
The plaintiffs attorney emphasized the integrated distribution scheme of the
Goodyear subsidiaries and their American parent. But Justice Scalia pointed out
that the mere fact that an American distributor coordinates with its subsidiary
does not mean that the subsidiary is an agent of the parent. And when asked by
Justice Ginsburg to cite any case law that would support the suggestion that
wherever a parent is subject to general jurisdiction, the subsidiary must be as
well, the plaintiffs attorney had nothing to offer.
s also argue that purposely reached out like McGee, and that the
continuous flow of product into NC under the control of the parent
company is sufficient to support general jurisdiction.
Subsidiaries are agents of the parent, and parents conduct is attributable
to them.
J. McIntyre Machinery v. Nicastro (2010)
The plaintiff in that case is a New Jersey scrap metal employee who lost four
fingers while operating a metal recycling machine at a factory in New Jersey. The
plaintiff sued the machine's manufacturer, J. McIntyre Machinery Ltd., based in
the U.K., for his injuries.
The machine was sold in the U.S. through an exclusive distributor, McIntyre
Machinery America. McIntyre Machinery is a distinct corporate entity from J.
McIntyre and is independently operated and controlled. J. McIntyre moved to
dismiss for lack of personal jurisdiction, and the issue worked its way through the
state court system. Ultimately, the New Jersey Supreme Court held that J.
McIntyre was subject to personal jurisdiction because it placed its product in the
stream of commerce through a distribution scheme that targets a national
market, including New Jersey.
CHALLENGING PERSONAL JURISDICTION
Direct attack: makes a motion for dismissal of the pending case for lack of personal
jurisdiction.
Once determined, must litigate the case on the merits in the forum generally
cannot appeal a finding of personal jurisdiction until a FINAL JUDGMENT has been
entered in the case.
Collateral attack: may refuse to appear and allow the court to enter default
judgment against her, then wait for to seek enforcement of the judgment in a second
case and argue that the first court did not have personal jurisdiction over her.
Advantages does not have to travel to the first forum and retain a lawyer
there to raise the direct jurisdictional challenge, and gets to litigate at home.
Main drawback waives any right to litigate the case on its merits can ONLY
raise the question of whether the first court had personal jurisdiction.
NOT a good strategic choice for s who may have a strong defense to the claim
on the merits.
12
NOTICE
MULLANE V. CENTRAL HANOVER BANK: NOTICE TO
Facts: Involved a NY state that allowed banks acting as trustees to pool relatively small
trusts into one large account (to take advantage of economies of scale); statute required
the trustee/bank to make periodic accountings to a court, demonstrating how it had
invested the assets and what kind of return the investments had generated. If the court
approved, it entered an order that (1) provided the trustee/bank with its fee and (2)
extinguished the beneficiaries right to sue for negligence or misfeasance in discharging
its responsibilities. Beneficiaries were entitled to appear at the hearing and object to the
fee or the way it did its job.
Notice: was given to the beneficiaries of the pooled trusts by publication gave the name
and address, name and date of the establishment of the common fund, and a list of the
participating individual trusts in a local newspaper. Beneficiaries objected that this form of
notice did not provide due process.
Due process: An elementary and fundamental requirement of due process in any
proceeding which is to be accorded finality is notice reasonably calculated to apprise
interested parties of the pendency of the action and afford them an opportunity to present
their objections.
Reasonableness under all the circumstances: did not require notice to all the
beneficiaries only those of known place and residence and only notice reasonably
certain to reach MOST of those interested in objecting, as this is likely to safeguard the
interests of all. Individual formal service was not required; regular mail delivery is
sufficient.
Ad hoc inquiry
Does not have to actually provide notice, but must attempt to do so.
Jones v. Flowers: state sent a certified letter to a homeowner to inform him about tax
delinquency and warn of public sale of his land; letter was returned as unclaimed. Court
held that although sending a certified letter is reasonable, things change when the state
knows that the notice was not received; then, additional steps need to be taken to
comport with due process.
SERVICE OF PROCESS
4(a)(1): sets forth the required contents of the summons

Rule 3: an action is commenced when the complaint is filed.
4(m): gives the 120 days after filing in which to effect service of process on the ; if
service is not effected within that period, the case is dismissed without prejudice unless
the can show good cause for the delay.
4(c)(2): provides that service may be effected by any person who is at least 18 years old
and not a party.
METHODS OF SERVICE OF PROCESS ON INDIVIDUALS
4(e)(2): provides 3 methods of service of process on an individual personal service,

substituted service, and service upon an agent.
Substituted Service: in essence, appoints someone of suitable age and discretion
residing in the s dwelling as an agent for service of process.
Dwelling/usual place of abode: Generally means where the is living at present.
May have more than one.
Suitable age and discretion: could be a doorman
13
Reside at the place where service is effected: should be someone with enough
connection to the s dwelling that we are reasonably certain she will forward the
papers to the . Weekend guests should not suffice, but a month-long guest could.
Service on an Agent: if appointed, depends upon whether accepting service of process
is within the scope of the agency. May also have been appointed by operation of law, as
with a nonresident motorist statute.
WAIVER OF FORMAL SERVICE
4(d): permits the to waive formal service of process by mail (this provision does not
mean that service of process by mail is allowed)
4(d)(5): waiving formal service preserves any objection to venue or PJ + SMJ
4(d)(3): D who waives service gets extra time to answer the complaint may answer up
to 60 days after the sends the waiver form, instead of 20 days from formal service of
process on her.
4(d)(2): if fails, without good cause, to sign and return the waiver, the court must
impose on the the expenses incurred by the in undertaking formal service and the
costs/attorneys fees of any motion the brings to collect those expenses.
4(d)(4): if waiver form is returned, files it with the court and the case then proceeds as
if a summons and complaint had been served at the time of filing the waiver.
METHODS OF SERVICE OF PROCESS ON CORPORATIONS & ASSOCIATIONS
4(h)(1)(B): allows service of process on a business to be made upon an officer a

managing or general agent, or any other agent authorized by appointment or by law to
receive service of process.
Purpose of the Rule: find someone who can be said to represent the corporation or
association, who understands the importance of the papers, and who is likely responsible
enough to ensure that they are transmitted to those who can act upon them.
o Courts look to the level of responsibility and authority exercised by the person
receiving process.
o Ad hoc inquiry i.e. in most corporations a receptionist would not be sufficient, but
in some cases a receptionist may have played a larger role in structuring the
business and could be seen as a managing or general agent.
GEOGRAPHIC RESTRICTIONS ON SERVICE OF PROCESS IN THE U.S.
State Court: process runs throughout the forum state; a state court may permit service
of process on an out-of-state only if the state long-arm statute (1) applies, (2) is
constitutional on the facts of the case, and (3) if service is effected in manner prescribed
by the statute.
Federal Court 4(k)(1)(A): a federal court can exercise personal jurisdiction and
permit service of process outside the state in which it sits only if a state court in that state
could do so (applies regardless of the basis for federal subject matter or diversity
jurisdiction)
4(k)(1)(C): a federal court can service process outside the state in which it sits
when authorized by a federal statute (i.e. Federal Interpleader Act)
4(k)(1)(B): BULGE RULE: allows service out of state only if effected within 100
miles of the federal courthouse in which the action is pending, and applies only to
parties brought in later under Rule 14 (impleader) or Rule 19 (necessary parties).
4(k)(2): applies only to claims that invoke federal question jurisdiction; unlike the
bulge rule, this can be applied to original defendants. Does so only when the is
14

not subject to personal jurisdiction of a state court, but when the exercise of
personal jurisdiction would be constitutionally proper.
Ex/ if a s contacts with a particular state are not sufficient to support
personal jurisdiction in that state, but her contacts with the U.S. generally
support the exercise of personal jurisdiction over her, she may be served with
process anywhere in the U.S. for a federal civil case invoking federal question
jurisdiction.
VENUE - 1391, 1404, 1406

GENERAL PRINCIPLES
Where, within the chosen court system (federal or state based on SMJ), will a
case be filed?
- Where the resides
- Where the claim arose
must assert the defense of improper venue in a timely fashion, or it will be waived.
Transfer only possible from one court within a judicial system to another in that same
system.
- If transfer is impossible because the more convenient and appropriate forum is in a
different judicial system, the court may dismiss under the doctrine of forum non
conveniens.
Parties are free to agree where a case is to be filed
- May be after the claim arises, by waiver of a venue objection.
- Forum selection clauses (so long as reasonable and just)
LOCAL & TRANSITORY ACTIONS
Local
-
actions: venue may be laid only where the relevant real property is found.
Generally involving title, possession, or injury to land
In-rem or quasi-in-rem cases in which the land is used as a basis for jurisdiction
Cases claiming a remedy in real property (foreclose on a mortgage, quiet title,
ejectment)
- Cses involving damage to realty (i.e. via trespass)
Transitory actions: everything that is not local
1391 VENUE FOR TRANSITORY ACTIONS IN FEDERAL COURT

1391(a): applies to cases founded ONLY on diversity
1391(b): all other cases (federal question)
1391(a)&(b)(1) Venue Based Upon Residence of s
May lay venue in any district where any resides, if all s reside in the same
State.
Any district in which all s reside
If all s reside in different districts of the same state, venue is proper in any
of them.
Based on residence, not citizenship (though that is relevant for diversity SMJ)
Majority view: ones district of residence is that in which she is domiciled.
1391(d): aliens may be sued in any district (including permanent resident
aliens)
1391(c) Residence of Corporations: a corporate resides in all districts in which
it is subject to personal jurisdiction when the case commenced.
15

Must have sufficient contacts with the district in question residence not
assessed with respect to the state as a whole, but with respect to each
individual district.
If a corporation has sufficient contacts with a particular state, but not with a
particular district, the corporation resides in the district in which it has the
most significant contacts.
Also applies to non-incorporated associations.
1391(a)&(b)(2) Venue Based Upon Events Underlying the Claim
May lay venue in any district in which a substantial part of the events or omissions
giving rise to the claim occurred.
Bates v. C&S Adjusters: creditor mails a letter from PA to debtor in NY, and in
doing so violates a federal debt collection law. Debtor had moved to AZ new
tenant in NY forwarded the letter to him.
Venue is proper in AZ receiving and reading the letter there constitutes a
substantial part of the claim.
1391(a)&(b)(3) Fall-Back Provisions
Applies only when no district anywhere in the U.S. satisfiers either of the 2 venue
choices.
Generally only when a claim arose entirely outside of the U.S.
1391(a)(3) venue is proper in any district in which any is subject to personal
jurisdiction at the time the action is commenced. (Diversity cases)
1391(b)(3) permits venue in any district in which any may be found. (federal
question)
1391 not applicable to cases removed from state court
When a a case filed in state court is removed to federal district court, the relevant
venue provision is 1441(a)
Venue is proper only in the federal district embracing the state court in which the
case was filed.
TRANSFER
Introduction
- Transfer can only be effected within a court system.
- Virtually all judicial systems permit transfer when the transferor court does not
satisfy venue rules such a case can ten be transferred to a proper venue within
the judicial system.
- Even when filed in a proper venue, statutes generally permit transfer based upon an
assessment of the relative convenience to parties and witnesses.
- No time limits but courts are less likely to order transfer after having invested time
and resources.
- May also be raised sua sponte by the court.
- DIFFERENT FROM FORUM NON CONVENIENS transfer applies when the more
convenient forum is in the same judicial system, and FNC applies when it is not.
- IN REMOVED CASES venue is proper in the district embracing the state court in
which the case was filed transfer would be made under 1404(a) regardless of
whether it would have been proper under 1391 - because 1391 does not apply to
removed cases.
- Transfer under either statute can only be made TO a district that is a proper venue
and has personal jurisdiction.
- But transfer can be made FROM a court that lacks venue and lacks personal
jurisdiction over the .
Applying 1404(a) Transferor Court is a Proper Venue
16

Permits transfer for the convenience of parties and witnesses, in the interest of
justice.
Essentially trying to determine whether another district might be the center of
gravity for the case.
Case is presently in a proper venue but the question is whether there is another
venue that is sufficiently more convenient that the court should override the s
choice and send the case there.
FACTORS
s choice of forum given significant weight
Where the relevant events took place
Relative court docket loads
Familiarity with applicable law
Forum selection clause (Stewart v. Ricoh not automatically dispositive)
Applying 1406(a) Transferor Court is an Improper Venue
Subject to dismissal under FRCP 12(b)(3).
Court may dismiss or, if it is in the interest of justice, transfer.
Van Dusen v. Barrack: held that a transferee court in a 1404(a) transfer must apply the
choice of law rules that the transferor (the original district) would have applied.
Change of venue should simply change the courtroom, and not the law to be
applied to the merits of the case.
Federal courts sitting in diversity must apply state choice of law rules
(substantive)
Ensures that the choice of law rules do not change just because the venue has
changed.
Not applicable to 1406(a) transfers, since in such a case the transferor court is
not a proper venue, and would allow the to capture favorable choice of law
rules from an improper venue.
FORUM NON CONVENIENS

GENERAL PRINCIPLES
Generally refers to a doctrine of dismissal.

A case, though pending in an appropriate forum, is dismissed because there is another
forum that is far more appropriate, and that forum is in a different judicial system.
PIPER AIRCRAFT V. REYNO

Facts
-
Plane crash in Scotland 6 dead

All deceased individuals - Scottish
Company that owned and maintained the plane - Scottish
Company operating the charter business using the plane Scottish
Heirs and next of kin Scottish
Plane manufactured by Piper in Pennsylvania
Propellers manufactured by Hertzell in Ohio
Suit brought against PA & OH manufacturers as liable for wrongful death of the
passengers under various torts theories.
Reyno: administratix of the estates domiciled in CA
Suit brought in state court in CA
Properly removed to federal district court in CA
17
Granted s motion to transfer to Middle District of PA (Piper mfgr.)

PA District court dismisses on grounds of forum non conveniens; Third
Circuit reverses, SCOTUS affirms the dismissal.
Public Interest Factors
- Administrative difficulties of keeping the case
- Local interest in having localized controversies decided at home
- Desire to have a case tried in a forum well-versed in the applicable law
- Avoiding undue conflict of laws or in the application of foreign law
- Unfairness of burdening citizens with jury duty in a case unrelated to the forum
Private Interest Factors
- Relative ease of access to evidence
- Ability to compel attendance of witnesses at trial through subpoena
- Expense of obtaining attendance of willing witnesses
Rationale
- Alternative Scottish forum already had jurisdiction over related litigation
involving all interested persons (including the U.S. companies)
- Administratively difficult for PA court Scottish law applicable to Piper, PA law to
Hartzell
- Scotland has substantial stake in the outcome, not PA
- Inefficient, piecemeal litigation since the Scottish parties (pilot) could not be
joined in the U.S.
- Key point: only if the remedy provided by the alternative forum is so clearly
inadequate or unsatisfactory that it is no remedy at all.
Ps could not avail themselves of progressive theories of tort liability and
damages for anguish in Scotland not dispositive.
Conditionality: forum non conveniens dismissals often conditional on the s agreeing
to waive certain defenses (personal jurisdiction, statute of limitations).
SUBJECT MATTER JURISIDICTION

DIVERSITY OF CITIZENSHIP 28 U.S.C. 1332; 28 U.S.C. 1369
o
Policy regarding diversity

Misallocation of federal judicial resources; federal courts should not be forced to
spend valuable time interpreting and applying state law.
Provides a neutral ground for litigants out-of-state litigant feels she may get
hometowned in a local court, since local judges are usually elected and thus
must answer to members of the community
Has diversity jurisdiction outlived its usefulness? Modern travel and mass
communication have so homogenized American culture that local and regional
biases are no longer prevalent. But some contend that the litigants
apprehension of local bias is not irrational
Type of Diversity
Citizens of different states
Citizen of state and foreigner
Citizen of different states, plus
foreigner
Foreign state vs. citizen of
state
Statute
1332(a)(1)
1332(a)(2)
1332(a)(3)
Example
NY vs. SC
NY vs. Brazil
NY vs. SC , Brazil
1332(a)(4)
Brazil vs. SC
18

o
COMPLETE DIVERSITY RULE Strawbridge v. Curtiss: No may have the same

citizenship as any . Complete diversity is a statutory requirement applying to cases
under 1332(a)(1).
Statutory exceptions: Interpleader, CAFA, Multiparty, Multiforum Trial
Jurisdiction Act
Determined at the moment the case was filed.
DETERMINING CITIZENSHIP
NATURAL PERSONS: to be considered a citizen of a state for diversity
purposes, a human must be (1) a citizen of the U.S., and (2) domiciled in that
state.
Domicile: Requires (1) establishing physical presence in a state AND (2)
the subjective intent to remain indefinitely.
Subjective intent: may be inferred from objective facts such as voter
registration, qualifying to pay in-state tuition, car registration, payment of
real and personal property taxes, location of bank accounts a grab-bag
of inidicia re: everyday life
Resident aliens: foreign citizens or subjections admitted to the U.S. for
permanent residence shall be deemed citizens of the state in which they
are domiciled.
U.S. citizens domiciled abroad: cannot sue or be sued under diversity
jurisdiction.
CORPORATIONS: treated as a thing, separate from the people who run it.
1332(c)(1): a corporation is a citizen of any State in which it is
incorporated and the state in which it has its principal place of business.
o A corporation may be incorporated in more than one state, but
there is only principal place of business under this statute.
o Nerve center test: sees the principal place of business as the
state from which the corporation directs its activity (headquarters).
o Old muscle test: focus on the physical aspect of the corporations
business, such as where it performs the bulk of whatever it does
(manufacturing, providing services, etc.)
OTHER BUSINESS ASSOCATIONS: consistent with the laws treatment of such
businesses as aggregations rather than entities, citizenship is determined by
individual members.
1332(c)(1): look to the citizenship of each member.
Includes both general and limited partners in partnership arrangements.
Includes all members of unions.
Summary: is the business deemed to be a corporation under the law of the state
in which it was formed? If yes, 1332(c)(1) applies, if not, the corporation looks to
the citizenship of all members.
AMOUNT IN CONTROVERSY
Must exceed $75,000.
Is exclusive of interest and costs.
Costs virtually all expenses of litigation except attorneys fees (filing
fees, fees to compel attendance of witnesses, etc.) cannot be included.
Attorneys fees may be included if permitted to be recovered by statute.
Ultimate recovery is irrelevant.
If ultimately recovers less than $75,000, 1332(b) provides that the
may not recover her costs from the and that the may have to pay s
costs.
19
o
o
If claimed original amount in good faith, courts usually allow her to

recover costs from the , even if the ultimate recovery was less than the
statutory amount in controversy.
s good faith allegation that the amount is satisfied controls unless it appears to
be a legal certainty that the claim is really for less.
Claims for equitable relief: most courts adopt the s viewpoint test, but
there is a trend toward supporting jurisdiction if the amount in controversy
would be satisfied from either the or s viewpoint.
Aggregation adding together of 2 or more claims to meet the amount in
controversy requirement.
General Rule: can aggregate as many claims as she has, so long as
she is the sole and there is only one .
Corollary: if there are multiple parties on either side of the case,
aggregation is not allowed must look to each s claims against each .
o P against multiple s cannot aggregate
o Multiple s cannot aggregate against
o Unless the claims are joint (i.e. joint liability; joint tortfeasors)
TIMING: diversity assessed at the time suit is commenced.
Grupo Dataflux: limited partnership sued a Mexican under alienage
jurisdiction; after years, it was discovered that the limited partnership had a
limited partner who was a citizen of Mexico. Although the trial had been
completed, and that partner was no longer part of the company, the court
dismissed because the claim had not been diverse when filed.
Principle: when one of the parties changes its citizenship during the
litigation, and there was no jurisdiction at the outset, this will not cure the
defect.
Caterpillar: no complete diversity when a case was removed from state to the
federal court, but the parties and the court failed to notice; when the defect was
discovered, and before entry of final judgment, the court dismissed the diversitydestroying party.
Principle: no jurisdiction when the case was commenced, but the
jurisdiction-destroying party was dropped from the case to cure the
defect.
Rule 21: allows the court to drop parties at any stage of the litigation on
terms that are just. Party dropped must be dispensable.
1331(a)(1): gives courts the power to hear cases between citizens of different states
where the amount in controversy exceeds $75,000.
1332(a)(2): gives courts the power to hear disputes between a citizen of a state and
an alien (citizen or subject of a foreign country) on the other where the amount in
controversy exceeds $75,000. (alienage)
Foreign corporations generally, a corporation formed in another country but
with its principle place of business in the U.S. is considered a citizen of the state
in which it has its principal place of business, and conversely, a corporation
formed in the U.S. with its principal place of business abroad is considered a
citizen of the state in which it was formed.
Must be between an alien (foreigner, non-U.S. person) and a citizen of the United
States.
Ex/ if , a U.S. citizen domiciled in England, sues , a citizen of Kansas, on a
state law claim exceeding $75k, there is no diversity, because although is a
citizen of the U.S., she is not domiciled in a state.
20

FEDERAL QUESTIONS: 28 U.S.C. 1331
o
Introduction
Osborn v. Bank of the United States: SCOTUS gave a startlingly broad
interpretation to the constitutional grant of federal question jurisdiction a case
falls within Art III if federal law might form an ingredient in the overall case.
Went even further in asserting that the mere potential that a federal issue
might be injected in the litigation is enough to conclude that the case
arises under federal law.
1331 statutory grant of federal question jurisdiction does not appear to
narrow this broad constitutional power, on its face.
Gives U.S. district courts original jurisdiction over all civil actions arising
under the Constitution, laws, or treaties of the U.S.
Federal courts have interpreted the language in the statute as narrower than the
same language in the Constitution.
- Well-pleaded complaint rule
- Federal law must be sufficiently central to the s claim.
Well-Pleaded Complaint Rule

Looks only to the s complaint; not the assertion of s defenses or to any
counterclaims against the
Only assesses the well-pleaded parts ignores any extraneous material the
may have put in the complaint i.e. material that does not support or relate to
the claim.
Central question Is the plaintiff attempting to vindicate some right given by
federal law?
Louisville & Nashville RR Co. v. Mottley: Court held that well-pleaded
complaint would only involve issues of breach of contract, which did not
implicate the federal law in any way; even though the RRs defense would
depend upon a federal statute, an anticipated defense is not part of the
well-pleaded complaint.
Claim itself must arise under federal law.
At the most basic level, the Mottleys claim was simply breach of contract.
State Law Claims with Federal Ingredients

Federal courts have federal question jurisdiction over state law claims if:
Federal law constitutes an essential element of the pleaded claim,
The case implicates a substantial federal interest
Federal issue is contested
Federal jurisdiction would not significantly interfere with the division
between state and federal courts.
American Well Works Co. v. Layne & Bowler Co.: pump manufacturer sued
the patent holder of a pump, only invoking state trade libel law
Although the litigation would have focused on federal law whether the
manufacturers pump violated the patent SCOTUS rejected federal
question jurisdiction.
Holmes test a suit arises under the law that creates the cause of
action.
Smith v. Kansas City Title & Trust Co: as corporate shareholder sued to
prevent the corporation form investing in bonds issued under a federal statute;
argued that the statute was unconstitutional, and therefore the investment
21
would violate state law (which forbade corporations from investing in unlawfully
issued investments)
Court upheld federal question jurisdiction where it appears from the
complaint that the right to relief depends upon the construction or
application of the Constitution or federal laws, and that such federal claim
rests upon a reasonable foundation.
Moore v. Chesapeake & Ohio RR: sued his employer under a state
employers liability law, under which the employer could not claim that the was
guilty of contributory negligence if the employer had violated a statute enacted
for employee safety.
Ps claim was that the employer had violated a federal act.
Court held that there was no federal question jurisdiction state-created
claim in a case to be decided by construction of federal law.
Gully v. First National Bank in Meridian: national bank transferred its rights
and liabilities to a successor bank , and by contract, the successor bank was
liable for state taxes assessed on the stock of the national bank. When they
failed to pay taxes, state officer sued in state court, & the bank removed to
federal court.
Rejects federal question jurisdiction.
Power to tax a national bank was based in a federal statute but
concluded that the federal issue was merely lurking in the background
and probably would not arise.
State-law claim in which litigation would center on issues of state contract
law.
Merrell Dow Pharmaceuticals v. Thompson: claims for damages allegedly
caused by s mothers ingestion of a drug while the mothers were pregnant
asserting a variety of state law claims, including negligence per se based on
alleged violation of a federal statute.
Rejects federal question jurisdiction.
Majority spoke of the lack of importance of the federal law involved,
emphasizing the fact that Congress had not created a federal right of
action.
Once Congress determines that there is no federal remedy, Court is not
free to supplement that decision in a way that makes it meaningless.
Federal law must not only establish a necessary element of the s claim,
but there must also be a substantial federal interest in the resolution of
the matter.
Dissent majoritys focus on the importance of the federal interest is
so malleable as to be unworkable.
Conflicting views of federal question jurisdiction reflected in Merrell
Dow
Majority sees the purpose of 1331 as providing a federal forum for the
vindication of federally-created remedies.
Dissent embraces a broader view 1331 has a role in ensuring uniformity
of federal law therefore, there should be federal court jurisdiction
whenever the outcome of the case depends upon an interpretation of
federal law.
Grable & Sons Metal Products v. Darue: IRS seized s land for non-payment
of taxes and sold at public auction to ; sued in state court on a state law
claim for quit title.
22
Upheld federal question jurisdiction.

Revived Smith and rejected any notion that federal question jurisdiction
required a federally created claim
State-law claim can satisfy the centrality requirement by
implicating sufficiently a federal claim.
o Federal question jurisdiction exists at least in part to provide lower
federal courts for the interpretation of federal law.
Three Factor Test to determine whether a state-law claims should be seen
to arise under federal law:
o Case necessarily raises a federal issue
o Federal issue is actually disputed and substantial
o Federal jurisdiction will not disturb any congressionally approved
balance of federal and state judicial responsibilities.
Federal issue here was disputed whether the IRS had satisfied the notice
requirement of federal law
Federal government has an interest in prompt collection of taxes, and that
notice provisions were interpreted consistently.
Exercise of jurisdiction would not affect the allocation of cases between
state/federal courts (state law cases involving title will rarely raise a
serious federal issue whereas in Merrell Dow an enormous amount of
cases would have been shifted to fed. court)
Generally supplants the basic Holmes test with a set of pragmatic
standards.
Case
Law Creating Claim
Well Works
Smith
Moore
Gully
Merrell Dow
State
State
State
State
State
Law to be
Interpreted
Federal
Federal
Federal
State
Federal
1331 Jurisdiction
No
Yes
No
No
No
REMOVAL - 1441, 1446, 1447

-
Removal: a mechanism for a to override the s choice of forum and transfer a case from a
state trial court to a federal trial court.
PROCEDURAL ISSUES
o
1441(a) grants the right to remove to the or the s means that ALL s who
have been served with process must agree to remove a case if any one of them
refuses to join the notice of removal, the case CANNOT be removed.
Must remove to the case to federal court within 30 days of service of process.
Majority view last-served rule: 30 days begins to run when the later is
served with process.
Based upon a policy interest in ensuring fairness to a later , who would
lose an opportunity to remove based upon the inaction of the first .
Minority view first-served rule: second could not remove unless she
could show that knew about her within the 30-day period for serving process
on -1 and delaying joining her in bad faith.
23

o
o
1446(a): starts the process by filing a notice of removal in the federal court in
accordance with this provision.
1446(d): requires the give written notice of the removal to all adverse parties and
file a copy of the notice in the state court
Filing in state court effects the removal act divests the state court of
jurisdiction over the case.
1447(c): If removal is improper for a reason OTHER THAN lack of subject matter
jurisdiction must move to remand within 30 days of removal, otherwise the
procedural defect is waived.
Subject matter jurisdiction ahs no time limit court must remand sua sponte
whenever it determines subject matter jurisdiction is lacking.
may waive the right to remove by taking some action in the state court that she is
not required to take i.e. filing a permissive counterclaim.
Generally, filing an answer in state court that raises a defense that might
conclusively determine the merits of the case does not result in such waiver.
Removal also does not waive the defense of lack of personal jurisdiction.
ISSUES OF JURISDICTION & VENUE

o
o
o
o
o
o
o
1441(a): can remove a case only if it is one of which the district courts of the U.S.
have original jurisdiction.
Case must satisfy a basis of federal subject matter jurisdiction.
Venue a case can be removed only to the federal district embracing the
place where the action is pending.
The only federal district court to which a case can be removed is the one
that geographically embraces the state court in which the case is pending.
1447(c): case must be remanded whenever it is discovered that there is no subject
matter jurisdiction regardless of the amount of time/resources expended at that point.
If the jurisdictional defect is cured before entry of judgment in federal court, removal
might be upheld.
Caterpillar v. Lewis: when removed the case, there was no basis for federal
subject matter jurisdiction but the federal court did not realize that fact.
During litigation, the claim against the who destroyed diversity was
dismissed before judgment was entered.
Although the case should not have been removed, the defect was cured
before entry of judgment SCOTUS upheld the judgment.
Federal courts uphold removal is a case that was originally NOT removable because
removable by voluntary act of the then has 30 days from when the removability
was ascertained to do so.
General rule removal is permitted on the basis of diversity only if the requirements
for diversity are met both at the time case was filed in state court AND at the time the
removes the case.
1447(e): after a case is removed on the basis of diversity if the sees to join
additional s who destroy diversity, the court may deny joinder, or permit joinder and
remand the action to State court.
Can a plead a state-court case in such a way as to thwart removal?
may join a whose citizenship prevents removal can remove only if she
can convince the court that joinder of the jurisdiction-defeating party is
fraudulent (i.e. there is no bona fide claim by or against that party)
may sue for exactly $75,000 (assuming complete diversity) some courts
permit the to remove by making a clear showing that the s claim in fact
meets the jurisdictional amount requirement.
24

may choose not to assert a federal question claim generally cannot be
defeated cannot force someone to assert a federal claim and cannot invoke
federal question by asserting a federal defense (well-pleaded complaint rule).
Narrow exception Labor Management Relations Act/ERISA any
substantive area that has been completely preempted by federal law.
2 exceptions to removal in diversity cases
No removal of a diversity case if any is a citizen of the forum.
Rationale if one of the s is a citizen of the forum, she has no need for
the protection of the federal court.
No removal of a diversity case more than one year after the case was filed in
state court.
Only becomes an obstacle for cases that are not removable when filed but
subsequently become removable because of s voluntary act.
Separate and Independent Federal Question Claim

1441(c): if the joins a separate and independent federal question claim with
one or more otherwise non-removable claims, the s may remove the entire
case, including otherwise non-removable matters.
Vests the federal court with discretion to remand to state court all matters
in which State law predominates.
Separate and independent means that the claims must be truly unrelated
Very difficult to meet
Taken at face value seems to allow removal of non-diversity, non-federal claims
that do not qualify for supplemental jurisdiction (precisely because they are not
transactionally related to the federal question claim).
Remand provision is unclear some courts have concluded that it permits
remand of the entire case, including the federal question claim.
25
III. DEFINING THE DISPUTE: PLEADINGS

PLAINTIFFS SIDE OF THE STORY: THE COMPLAINT
BASIC PRINCIPLES
Complaint
A short and plain statement of the claim.
Code Pleading
Abolished forms of action and replaced them with a requirement that complaints
plead facts, at the appropriate level of specificity.
Notice Pleading
Adopted with FRCP
Primary function of a complaint is to give the notice of the claim
Sets out the basic allegations for each side of the dispute
Rule 7 Pleadings Allowed: Form of Motions

o 7(a) Pleadings.
There shall be a complaint and an answer;
A reply to a counter claim denominated as such;
An answer to a cross-claim, if the answer contains a crossclaim;
A third-party complaint, if a person who was not an
original party is summoned under the provision of Rule 14;
And a third party answer, if a third-party complaint is
served.
No other pleading shall be allowed, except that the court
may order a reply to an answer or a third party answer.
Rule 8 Complaint & General Rules of Pleading.
- 8(a) Claim for Relief. A pleading which sets forth a claim for relief, whether an
original claim, counterclaim, cross-claim, or third party claim, shall contain three things:
o (1) short and plain statement of the grounds upon which the
courts jurisdiction depends, unless the court already has jurisdiction and the
claim needs no new grounds of jurisdiction to support it,
Note: B/c federal courts have limited subject matter
jurisdiction, it is essential that the plaintiff allege that the case is properly
within the courts jurisdiction. Many state rules require such an allegation as
well, so that plaintiff must aver that she has selected the proper trial court for
her dispute. Some states also require the plaintiff to allege facts supporting
personal jurisdiction if the defendant is a nonresident, and a statement of fact
supporting venue.
o (2) a short and plain statement of the claim showing that the
pleader is entitled to relief, and
o (3) a demand for judgment for the relief the pleader seeks.
Relief in the alternative or of several different types may be demanded.
Note: In the demand, often called to prayer, the
plaintiff must tell the court what she wants to recover. Under Rule 54(c) and
26

many state provisions, the demand does not limit plaintiff recovery. She is
entitled to recover whatever relief she proves at trial, even if that is more
money than she asked for, and even if it is of a different type than she
requested. Plaintiffs can request damages or equitable relief such as
injunction, specific performance, or declaratory judgment, etc
- 8(d) Effects of Failure to Deny. Averments in a pleading to which a responsive
pleading is required, other than those as to the amount of damage, are admitted when not
denied in the responsive pleading. Averments in a pleading to which no responsive
pleading is required or permitted shall be taken as denied or avoided.
- Rule 8(e)(2) A party may set forth two or more statements of a claim or
defense alternatively or hypothetically When two or more statements are made in the
alternative and one of them is made independently would be sufficient, the pleading is
not made insufficient by the insufficiency of one or more of the alternative
statements.
o All statements must be made subject to the obligations set forth in
Rule 11.
SPECIFICITY, CONSISTENCY, & HONESTY IN PLEADING

o
United States v. Board of Harbor Commissioners (1977) specificity

s filed a complaint alleging s discharged oil into the river
s moved for a more definite statement because it did not specify which
was responsible for the discharge, how much was discharged, cost of
removal, and the actions that caused the discharge.
Motion for a more definite statement is granted if a pleading suffers from
unintelligibility, rather than a want of detail.
A complaint is sufficiently definite if the opposing party is fairly notified of the
nature of the claim against it.
Inconsistent Allegations
8(d)(2): any party may set out 2 or more statements of a claim or defense
alternatively or hypothetically, either in a single count or defense or in separate
ones.
If a party makes alternative statements, the pleading is sufficient if any
one of them is sufficient.
8(d)(3): allows a party to state as many separate claims or defenses as it has
regardless of consistency.
Recognizes that a party may not be in a position at the outset of the case to
know what actually happened or what facts may be established at trial.
McCormick v. Koppman (1959)
sued 2 s in a single case, seeking recovery for alleged wrongful death
of her husband in a car collision with a truck.
o Alleged negligence against the truck driver (and that her husband
was free from negligence)
o Alleged a dram shop violation against the owners of the tavern her
husband had been drinking in.
Judgment rendered against the truck driver, who argued that the
inconsistency in the s pleadings required dismissal of the claim against
him.
27
Without pleading in the alternative, would have had to choose one

theory at the outset and proceed against one at a time, with no
guarantee of relief.
Alternative pleading allows both claims to proceed in a single case,
allowing the to avoid the possibility of being left out in the cold if she
has to sue the s in separate suits.
LEGAL SUFFICIENCY
If on the face of the complaint, the allegations could not support a judgment for the ,
the case can be dismissed at the outset as legally insufficient.

If the alleged everything she has alleged here, would the law provide a
remedy?
At common law and today, under code pleading, the tested the legal
sufficiency of a complaint by filing a general demurrer to the complaint.
In the federal system, the same function is served by the motion to dismiss
for failure to state a claim under Rule 12(b)(6)
In ruling on a general demurrer or a 12(b)(6) motion, the court looks only to
the face of the complain; it does not consider evidence.
Issue is not whether will ultimately prevail, but whether she is entitled to
offer evidence to support the claim.
Mitchell v. Archibald & Kendall, Inc. (1978)
injured during a robbery attempt while parked in a public straight waiting to
enter s premises.
Dismissed for failure to state a claim
A motion to dismiss for failure to state a claim is decided on the basis of the
facts pleaded in the complaint, not legal conclusions that may be alleged or
drawn from the pleaded facts.
Original complaint did not set forth the theory that the public street was part of
s premises.
HEIGHTENED SPECIFICITY
o
o
o
As to certain topics, merely satisfying the notice pleading regime of FRCP is not
enough party must give more detailed factual allegations as to these topics.
Rule 9(b): allegations of fraud or mistake
Heightened pleading requirement must be raised by the opposing party.
Conclusory allegations of fraud are not sufficient
Should generally include the identity of the person making the statement,
when and where the misrepresentation was made, how it was
communicated, and the resulting injury.
9(g): items of special damage (those that do not ordinarily flow from an event)
Requires striking a balance between the requirements of Rule 9 and the simple,
concise, direct requirements of Rule 8.
Arises in context with certain statutes i.e. PSRLA
Tellabs Inc. v. Makor Issues & Rights Ltd. 2007
A complaint alleging securities fraud under the PSLRA will survive a motion to
dismiss only if a reasonable person would deem the inference of scienter cogent
and at least as compelling as any opposing inference one could draw
from the facts alleged.
28

STRANGE CAREER OF RULE 8(a)(2)
o
Conley v. Gibson (1957)

asserted employment discrimination claims, but complaint did not specifically
spell out what was discriminatory about the s acts.
SCOTUS held the complaint sufficient claimant not required to set out in detail
the facts upon which he bases his claim.
Rule 8 requires only that the give the fair notice of what the s claim
is and the grounds upon which it rests.
Claim should not be dismissed for failure to state a claim unless it appears
beyond doubt that the can prove no set of facts in support of his claim
which would entitle him to relief.
Helped established the idea of notice pleading. Thus, pleadings are
sufficient if they put the litigant on notice of what is claimed.
Swierkiwicz v. Sorema (2002)
claimed discrimination based on national origin.
SCOTUS rejected efforts to require detailed pleadings in employment
discrimination cases.
Courts have no authority to impose a heightened pleading requirement can be
imposed by Federal Rule or by statute only.
Requirement of greater specificity conflicts with Rule 8(a)(2) requiring only a
short and plain statement of the claim showing that the pleader is entitled to
relief.
Cautions against overly technical pleadings.
Twombly (2007)
s brought a class action on behalf of local telephone customers, seeking to
allege a violation of the Sherman Act, alleging that the ILECs had conspired not
to complete with each other in local phone service.
No direct proof of such an agreement.
Alleged conscious parallel behavior to support the claim s were
aware of what each other was doing (offering long-distance service but
not competing outside its region in local service) and did the same thing.
Overruled Conleys no set of facts approach SCOTUS held s failed to
state a claim by failing to allege facts that tended to rule out that the ILECs were
simply acting independently, and to suggest that an agreement was made.
Requires enough facts to state a claim that to relief that is plausible on
its face.
Sufficient to nudge the claim from one that is conceivable to one that is
plausible.
Even short and plain statements require sufficient factual allegations to support
the claim.
Iqbal (2009)
Contention that federal government officials discriminated against a Pakistani
Muslim on account of his race, religion, and national origin in violation of his
constitutional rights.
Would have to show acted with a discriminatory purpose to establish
liability
Complaint failed to meet Rule 8 pleading standard SCOTUS held that the
allegation of purposeful discrimination was conclusory.
29
Although a complaint need not include detailed facts, a cannot simply

assert conclusions such as discriminatory purpose without factual
allegations to back up those conclusions.
Twombly and Iqbal reflect a shift in pleadings doctrine to one less permissive than
Conley and Swierkiewicz convey a more cautious attitude based on the expense and
burden of discovery.
P needs to provide enough facts in the complaint to show that the key
allegations are plausible, or else litigation will not be permitted to go forward.
RULE 11 SANCTIONS
o
11(a) Signature
Every pleading, written motion, and other paper shall be signed by at least
one attorney of record in the attorneys individual name, or, if the party is
not represented by an attorney, shall be signed by the party.
Zuk v. Eastern PA Medical College (2007)
Sanctions imposed on s attorney, who had never litigated a copyright
infringement case.
Attorney here failed to make a reasonable inquiry into the facts and law
that governed the case.
Such investigation here would have resolved the statute of limitations
issues, and no limitation would have been filed.
11(b) Representations to Court/Certification
By presenting to the court a pleading, written motion, or other paper, an
attorney or unrepresented party is certifying that to the best of the
persons knowledge, information and belief, formed after an inquiry
reasonable under the circumstances.
(1) Not being presented for any improper purpose (to harass, cause
unnecessary delay or needless increase in cost of litigation).
(2) Claims and defenses have non-frivolous legal basis (warranted by
existing law or by a non-frivolous argument for extending, modifying, or
reversing existing law or for establishing new law)
(3) Factual allegations have reasonable factual basis (evidentiary
support, or likely will after reasonable opportunity for further investigation
or discovery)
(4) Denials have reasonable factual basis (warranted on the evidence,
or if specifically so identified, are reasonably based on belief or a lack of
information)
Obligates the lawyer to make a reasonable inquiry and to refrain from making
baseless accusations.
11(c) Sanctions
Purported violations of Rule 11 may be raised sua sponte by the courts own
initiative [11(c)(1)], or a party may move for sanction [11(c)(2)].
11(c)(1)
Court will enter an order to show cause requiring a party, attorney, or firm
to show cause why specified behavior did not violate Rule 11.
11(c)(2)
Safe Harbor Provision: Party must serve a Rule 11 motion on the other
party at least 21 days before the party may file the motion with the
court.
30

o
On Courts Initiative sua sponte

11(c)(4) - Nature of Sanctions
Limited to what is sufficient to deter repetition of such conduct or comparable
conduct by others similarly situated.
May consist of, or include, nonmonetary directives, an order to pay a court
penalty, an order directing payment to the movant of some or all reasonable
attorneys fees and other expenses incurred as a result of the violation.
Monetary sanctions may NOT be awarded against a party represented by
counsel for a violation of b(2), OR on the courts initiative unless the court issues
its order to show cause before a voluntary dismissal or settlement of the claims
made by or against the party which is, or whose attorneys are to be sanctioned.
DEFENDANTS RESPONSE
PRE-ANSWER MOTIONS UNDER RULE 12
- Defendants Options in Response
- Rule 12(a)(1) says that you have 20 days to answer or serve a motion, unless D
waives service of process under Rule 4(d) then he has 60 days, and 90 days if out of the
country. (Rule 6(a) - day of process NOT included in calculation)
- Rule 12(a)(4) serving a motion under this rule changes the time in which to serve
the answer. If the court denies the motion, the responsive pleading (answer) must be
served within 10 days after notice of the courts action.
- Modifications court is free to set its own table, a party may move for an extension
under Rule 6(b), or the parties themselves can stipulate to extensions (that must be
approved by the judge).
- The D has two basic choices in responding to a complaint:
o (1) Can make a motion or
A motion is a request that the court order something,
such as a dismissal of the case, etc
o (2) file an answer.
The answer, on the other hand, is a pleading that
responds to allegations of the complaint and may add new matter as well.
-Involve strategic choices
oA motion may result in dismissal of the case, obviating the need to draft an
answer.
oBut responding by answer may be more appropriate when the needs more time
to develop the facts supporting a particular motion to dismiss.
-
Motion
- Motions serve two basic functions:
o 1. Tests the legal sufficiency of the plaintiffs claim, questioning
whether the law accords a remedy on the facts alleged.
o 2. Tests the factual, or formal, sufficiency of the complaint, questioning
whether the plaintiff has set forth her claim in appropriate detail.
- Note: 12(h) Waiver If not raised in the first 12(b) motion then they are
waived. But see 12(g)(2) - Only applies if defense or objection was available to
party at time it made its earlier motion.
Rule 12(b) Motions:

- May be raised in an answer as an affirmative defense, or by motion.
* = Waivable is required to include these in her first response or else they are
waived.
31

-
12(b)(1)
12(b)(2)
12(b)(3)
12(b)(4)
12(b)(5)
12(b)(7)
12(b)(6)
Lack of Subject Matter Jurisdiction (Can be done at any time)

Lack of Personal Jurisdiction *
Improper Venue *
Insufficiency of Process *
Insufficiency of Service of Process *
Party Required to be There is Not Present
Failure to State a Claim Upon which Relief can be Granted
o The question is so what? [reverse of 8(a)(2)] As a matter of law
there is no relief.
o If granted, disposes of the claim. If only one claim, then the case is
over and dismissed
Rule 41(b) States that any dismissal under this
subsection or under any other rule is with prejudice, unless lack of
jurisdiction, venue, improper venue, or for failure to join a party under Rule
19.
12(b)6 is with prejudice unless the court orders.
However, normally granted with leave to amend.
Motion for Judgment on the Pleadings Under Rule 12(c)

The same as a motion to dismiss for failure to state a claim under 12(b)(6)
If raised after the has served her answer, it is a motion under 12(c).
12(e) Motion for More Definite Statement (rarely made/granted)
-If a pleading to which a responsive pleading is permitted is so vague and
ambiguous that a party cannot reasonably be required to frame a responsive pleading, the
party may move for a more definite statement.
-D claims the P has not pleaded enough to reply. Not enough information to reply.
-If granted, has 10 days to plead with more clarity. then has 10 days to respond
after service of the new complaint.
12(f) Motion to Strike
o Upon motion made by a party before responding to a pleading, the
court may order stricken from any pleading any insufficient defense or any
redundant, immaterial, impertinent, or scandalous matter. Might be prejudicial info
that would affect jurys decision (eg. P goes to church, D does not).
Moving party must show prejudice, as a practical matter.
o Can also be use by the P to in effect a 12(b)6 type of motion to test the
Ds affirmative defenses. P tests the legal sufficiency of the Ds answer.
o Disfavored often used simply to delay proceedings.
o Also allows the court to strike an insufficient defense.
12(g) and 12(h) Raising 12(b) Defenses
o Abolishes the special appearance and allows s to raise several defenses
simultaneously.
o 12(g)(2) requires a who makes a motion under Rule 12 to join in that motion a
defense or objection that was available to the party but omitted from its earlier motion.
If not, she must not make another motion under this rule as except as
provided in 12(h)(2) and 12(h)(3).
Concerned with a asserting two Rule 12 motions. In general, omitting a
Rule 12 defense that was available at the time, from a Rule 12 motion waives
the right to bring a second motion under Rule 12.
o 12(h)(1) defenses in 12(b)(2), (3), (4), and (5) must be put in the first defensive
response under Rule 12, whether a motion or an answer or else they are WAIVED.
32

Lack of personal jurisdiction, improper venue, insufficiency of process, and
insufficiency of service of process.
Rationale threshold issues that ought to be determined at the outset, and
waivable defenses so the burden is appropriate placed on the to raise them
first or lose them.
12(h)(2) defenses in 12(b)(6) and (7) may be raised as late as at trial (any time
before entry of judgment).
o Failure to state a claim upon which relief can be granted & failure to join an
absentee under Rule 19.
Rationale these defenses may mature later in the litigation.
o WAIVED only if not raised sometime before judgment is entered at the trial court.
12(h)(3) defenses in 12(b)(1) may be raised anytime.
o Lack of subject matter jurisdiction
o If a case does not invoke federal subject matter, a federal court must dismiss, even
if it has invested years in the case.
o
FAILURE TO ANSWER DEFAULT UNDER RULE 55

o Rule 55(a) - Entry of Default
Usually entered by the clerk of the court if the shows by affidavit or
o Rule
otherwise that the has failed to plead or otherwise defend as provided by

these rules.
I.e. failed to respond within the time period set forth by Rule 12.
Does not entitle the to obtain relief.
Cuts off the s right to file a response to the complaint.
If the 20 days have expired, could ask for an extension under 6(b) and
then file the answer but NOT if the has already had default entered.
If default has been entered, may not respond unless she convinces the
court to set aside the default.
55(b) - Default Judgment
Default is an absolute prerequisite to default judgment.
May be enforced like any other judgment.
55(b)(1) - Can be entered by a clerk ONLY IF:
Claim is for a sum or for an amount that can be made certain by
calculation.
must provide an affidavit of the damages due.
must have failed to appear in the case.
cannot be a minor or incompetent.
Only in those cases where there is no need for judicial discretion.
55(b)(2)
Otherwise, makes an application for default judgment from the judge.
Generally determined in a hearing by examining:
o (1) Whether s failure to respond is willful
o (2) Whether the has been harmed
o (3) Whether the has a meritorious defense to the underlying case.
Judge may refuse to enter judgment when it is clear that the merits are
disputed and the potential liability is large.
33
If the s contentions on the merits are weak, or if the delay has harmed
the , or if the has acted in bad faith, the court will be inclined to enter
default judgment.
Notice required? Written notice required, served at least 3 days before
the hearing, but ONLY if the has appeared personally or by a
representative in the case.
D may not contest whether liability will be imposed, but may argue that
the damages are less than what the requested.
54(c): judgment can never exceed the amount of damages the sought
in the complaint, nor can it include a type of relief not sought in the
complaint.
o Rule 55(c) Motion to Set Aside a Default
Requires that the moving to set aside the default show good cause
(reasonable excuse) for her failure to defend in a timely fashion.
Motion should be made within a reasonable time.
Court may also insist that the have a viable defense otherwise it makes no
sense to set aside a default and put the case back in the litigation stream
o Rule 60(b) Motion to Set Aside a Default Judgment
(1) motion to set aside is based upon mistake, inadvertence, surprise, or
excusable neglect
must convince the court that she was guilty of a mistake or of excusable
neglect that should be forgiven by setting aside the judgment.
(4) judgment is void (i.e. lacked personal jurisdiction, etc)
o Shepard Claims Service, Inc. v. William Darrah & Associates (1986)
Default may be set aside if it resulted from a misunderstanding between lawyers
for the respective parties
Motion to set aside a default will be granted if the will not be prejudiced, the
has a meritorious defense, and the s conduct was not willful to refuse to set
aside the default would be an abuse of discretion.
Misinterpretation of extension granted by s lawyer.
ANSWER
o
must accomplish 2 primary goals:

(1) Respond to the allegations of the complaint and
(2) Raise new matter through affirmative defenses
Responding to Allegations in the Complaint
D has 3 possible responses under 8(b)(1)(A) and 8(b)(5)
(1) Admit allegations
o Taken as true no proof of such issues required at trial
(2) Deny allegations
o Contested issue on which evidentiary determination is required
said to be joined
(3) Or say she lacks sufficient knowledge/information on which to
admit/deny.
o 8(b)(5): this has the effect of a denial, but must be done honestly
and properly, or run the risk of Rule 11 sanctions.
8(b)(6): failure to deny an allegation in the complaint is considered an
admission of that allegation.
Raising Affirmative Defenses
34

Differ from denials inject new material into the dispute. Generally, an
affirmative defense assumes the validity of a claim and then adds something
new. A who fails to plead an affirmative defense risks waiving the defense
omitted.
8(c)(1): lists classic affirmative defenses
David v. Crompton & Knowles (1973)
Court denied s motion to amend its answer to deny that it sold the machine
implicated in a products liability action.
Could have discovered this information earlier by making a reasonable
investigation prior to answering.
BLL: An answer that a is without knowledge sufficient to admit or deny an
allegation in a complaint will be deemed an admission if the matter is
something peculiarly within the control and knowledge of the D.
VOLUNTARY DISMISSAL RULE 41(a)

o
Rule 41(a)(1)(A)
Limits the s ability to take a voluntary dismissal without a court order, and do
so in only two situations, by two mechanisms.
(1) may unilaterally file a notice of dismissal (in writing)
o Must be filed before the adverse party serves either an answer or a
motion for summary judgment.
(2) may dismiss by stipulation of dismissal signed by all parties who
have appeared.
Rule 41(a)(1)(B)
Makes it clear that dismissal by either method is generally without prejudice.
But if the previously dismissed any federal- or state-court action based on or
including the same claim, a notice of dismissal operates as an adjudication on
the merits.
First voluntary dismissal is without prejudice, but if the refiles the case
and then dismisses by filing a notice of dismissal, that second
dismissal operates as an adjudication on the merits (meaning it is with
prejudice).
Does NOT apply when the second dismissal is by stipulation.
Rule 41(a)(2)
Address voluntary dismissal by court order.
In any situation not covered by Rule 41(a)(1), the court may grant a s motion
for voluntary dismissal.
Court may impose whatever terms and conditions it deems proper.
Unless otherwise stipulated, presumed to be without prejudice.
Expressly addresses dismissal of the case if a counterclaim is pending.
Court should dismiss only if the counterclaim can remain pending for
indepdent adjuciation.
AMENDED & SUPPLEMENTAL PLEADINGS

AMENDMENTS OF RIGHT & LEAVE TO AMEND RULE 15(a)
Reflects the modern attitude of liberal amendment of pleading.

Amendment as a Matter of Course
A party may amend the partys pleading once as a matter of course at any time
before a responsive pleading.
35
Responsive pleadings are ANSWERS, NOT MOTIONS

15(a)(1)(A) - An absolute right to amend pleading once as long as an
answer has not been served.
15(a)(1)(B) - If the pleading in question is the answer, the has the right to
amend within the first 20 days.
If the answer contains a counterclaim, the can amend up until the
replies.
Amendment by Consent
Any pleading may be amended if the adverse party consents to the amendment
in writing.
Amendment by Leave of Court
If its too late to amend as a matter of course and the opposing party wont
consent, a party must seek the permission of the court to amend a pleading.
Makes a motion for leave to amend the pleading.
Leave should be freely given when justice so requires.
Why would an amendment NOT be allowed?
If case is ready to go to trial
Other side claims prejudice
Due process limitations (i.e. adding a party at the last minute in a trial)
RELATION BACK OF AMENDMENTS (AMENDMENTS & STATUTE OF

LIMITATIONS
Reflects the modern attitude of liberal amendment of pleading.

15(c)(1)(A)
Applies when the law that provides the applicable statute of limitations allows
relation back.
15(c)(1)(B)
Deals with amendment to add a new claim after the statute has expired.
Permitted if the amended pleading arose out of the conduct, transaction,
or occurrence set out or attempted to be set out in the original
pleading.
Rationale if the amended pleading arose from the same real-world events as
the original pleading, the was put on notice of potential liability prior to the
expiration of the statute.
Thus courts routinely permit relation back under 15(c)(1)(B) unless the
amendment raises new material for which the was not fairly put on notice by
the original complaint.
15(c)(1)(C)
Deals with amendment to add a new defendant after the statute has expired.
Permits relation back in this context ONLY if three requirements are satisfied:
(1) Claim arises from the same conduct, transaction, or occurrence as that
stated in the original complaint,
(2) Within 120 days after filing of the original complaint, the new has
received such notice of the suit that she will not be prejudiced in
defending [15(c)(1)(C)(i)],
(3) Within the same period, the new knew or should have known that
the action would have been brought against it, but for a mistake
concerning the property partys identity. [15(c)(1)(C)(ii)].
Notice also Rule 4(m) and the requirement of 120 days for service of
process, or whichever is longer.
36
Basically applies only where the originally sued the wrong , but the right
knew about the case and knew that, but for a mistake, she would have been
named originally.
Krupski v. Costa Crociere (2010)
Clarified operation of Rule 15(c)(1)(C) where sues the wrong and seeks
to amend her complaint after the statute of limitations has run.
Emphasizes that the focus is on s knowledge, NOT s knowledge.
o Amendment allowed to relate back even if the knew of the
proper s existence earlier and delayed amending the complaint
for a significant amount of time.
o A can know that a party exists without knowing that the party is
the proper party to sue.
37
IV. PARTIES AND CLAIMS: ESTABLISHING THE SIZE AND

STRUCTURE OF THE DISPUTE
JOINDER OF CLAIMS & PERMISSIVE JOINDER
GENERAL PRINCIPLES
OVERARCHING POLICIES: Efficiency & Consistency

Trend toward trial packaging & avoiding duplicative litigation
Of heightened importance in an era of crowded dockets and litigation delay
Avoids the possibility of inconsistent outcomes
May erode public confidence in the justice system
But most joinder provisions are permissive: embody a policy of litigant
autonomy, tend to defer to the s structuring of the case.
Tension between the urge to package litigation efficiently and the sense that the
ought to be entitled to structure the case as she sees fit.
POLICIES BEHIND RULE 14/19/24
s joinder choices may lead to inefficiency and inconsistent outcomes by promoting
multiple litigation (efficiency)
May subject the interest of the absentee or of the to possible harm.
BASIC FRAMEWORK
Is there a joinder provision in the FRCP that allows assertion of this claim or joinder
of this party?
If so, does this claim invoke diversity or federal question jurisdiction? If so, it may be
asserted in the pending case.
If not, can the claim nonetheless be asserted in federal court under invocation of
supplemental jurisdiction?
PERMISSIVE JOINDER OF CLAIMS RULE 18
18(a): may assert all claims he/she may have against the they do not have to be
related in any way.
Runs risk of jury confusion in a trial dealing with disparate, unrelated claims but the trial
judge is given discretion to order separate trials.
Also applies to defendants with regard to asserting counterclaims, cross-claims, or thirdparty claims.
PERMISSIVE JOINDER OF PARTIES RULE 20
20(a)(1) and 20(a)(2): define who may be joined as co-plaintiffs and co-defendants,
respectively if their claims:
Arise out of the same transaction or occurrence; AND
Raise at least one common question of law or fact
Strategic Issues for Joining Defendants
Less expensive and burdensome for s to join everyone who might potentially be
liable
Issue preclusion
can benefit from each co-s effort to shift blame
Strategic Issues for Joining Plaintiffs
38

Suing alone may allow a to recover from a first before others can get at a s
assets
May believe that her case is more compelling, and adding a co- would detract
Widely held view that a single fares better simply because she does not have to
share a recovery with others.
Kedra v. City of Philadephia (1978)
sued for acts of police brutality and civil rights violations occurring over the
course of 1 years, and did not happen to all the parties.
BLL: Joinder of reasonably related claims for relief by or against different parties
is allowed.
Even though the events extended over a lengthy period of time, they are
reasonably related to one another as part of a systematic deprivation of rights.
Insolia v. Philip Morris, Inc. (1999)
BLL: Joinder of parties will not be allowed if each party has a highly individualized
claim.
Only common thread to these claims is the allegation of an industry-wide conspiracy
to suppress the truth about cigarettes.
Such misinformation reached the s in different ways, at different times,
from different sources.
Causes of cancer also different.
Judicial economy not served when a jury is subjected to evidence relevant to some
parties, and not to others.
SUPPLEMENTAL JURISDICTION CONNECTION
If two s properly joined under Rule 20 do not both meet the amount-incontroversy requirement for diversity, but 1367(b) only removes jurisdiction over
claims brought by s against persons made parties under Rule 20.
Does each s claim have to satisfy the amount-in-controversy
requirement to invoke diversity jurisdiction?
Exxon Mobil Corp. v. Allapattah Services: Court upheld supplemental
jurisdiction over jurisdictionally sufficient claims by s so long as they arose from a
common nucleus of operative fact with the claim of a that did satisfy the amountin-controversy requirement.
Rationale: if there is complete diversity, the presence of a single claim in
excess of $75,000 invokes diversity jurisdiction; IN CONTRAST, if there is not
complete diversity of citizenship between all s and all s, there is no
diversity case at all, and nothing to which supplemental jurisdiction can
attach.
If s are necessary, the ENTIRE case/controversy should not be in federal
court the operative unit fails.
Here, the anchor claim is the operative unit so permissive claims can piggyback.
Majority reads 1367 on its terms excludes Rule 20 & 23 s.
Issue - Allapatah did not clarify why supplemental jurisdiction should be
proper to overcome an amount-in-controversy problem in a diversity case
where there are multiple s but not where there are multiple s.
1367(b) expressly removes jurisdiction over claims brought by s against
persons made parties under Rule 20 (co-s)
Dissent: thinks more limited reading of 1367 fits with the case law
operative unit should be the entire case AS PRESENTED, not claim by claim
39

thus, it would fail 1367(a) and there is no need for Rule 20 & 23 to be
mentioned in 1367(b).
IMPLEADER/THIRD PARTY PRACTICE RULE 14

PROCEDURAL & POLICY ISSUES
o
o
o
May only be used by a defending party to join an absentee (includes s against whom
counterclaims have been made) who is or may be liable to the defending party for all
or part of the claim against it.
Defending party then referred to as third-party plaintiff and the absentee
joined by impleader is the third-party defendant.
Almost always claims for indemnity or contribution.
14(a)(1): establishes that a defending party has a right to implead within 10 days
after she serves her original answer to the s complaint; beyond that, she must make
a motion seeking court permission to implead.
Motions are generally granted unless doing so will unduly delay resolution of the
case.
Policy: fosters efficiency, consistency, and fairness to the outweighing the interest in
autonomy, because it compels joinder of an absentee to avoid a being saddled with
multiple or inconsistent obligations (in line with the goals of Rule 19).
Difference from Cross-Claims
Cross-claim is asserted by a party against a co-party; impleader claim is
asserted by a party against an absentee.
Cross-claims arise from the same transaction or occurrence as the underlying
case; impleader is narrower, for indemnity or contribution on the underlying
claim.
Claims created by 14(a)
Impleader claim under 14(a)(1) asserted by a defending party against an
absentee (the third-party ) who may owe her indemnity or contribution on the
underlying claim against her
Any subsequent claims between the third-party and third-party are
NOT cross-claims because they are now opposing parties, NOT co-parties
joined under Rule 20.
14(a)(3) claim by the original against the third-party (must arise from same
transaction or occurrence)
Once asserted, if the third-party wants to assert a claim against , it
would be brought under 13(a)(1) as a compulsory counterclaim NOT
under Rule 14.
14(a)(2)(D) claim asserted by the third-party against the (must arise from
same transaction or occurrence)
Once asserted, if wants to assert a claim against the third-party , it
would be brought under 13(a)(1) as a compulsory counterclaim NOT
under Rule 14.
JURISDICTIONAL & RELATED ISSUES

o
Personal jurisdiction: first look to the jurisdictional statutes of the state to see
whether jurisdiction is possible; but in an impleader stuation, one may also utilize the
Bulge Rule under 4(k)(1)(B) to serve the third-party outside the forum state in the
absence of a state long-arm statute.
40

4(k)(1)(B): only applicable to join third-party s n impleader and necessary
parties under Rule 19.
Venue: generally does not create a barrier to joining the third-party .
Likely that 1404(a) and 1406(a) apply only to the initial claims against the
Impleader claim is so closely related to the underlying case that courts routinely
recognize ancillary venue as long as venue is proper in the underlying case,
the third-party has no right to bject that venue is not proper as to her.
Subject matter jurisdiction:
Owen Equipment & Erection Co. v. Kroger: citizen of Iowa sued a citizen of
Nebraska invoking proper diversity jurisdiction; impleaded a third-party , and
the original asserted a 14(a)(3) claim under state law against the third-party .
During trial, discovered that third-party was actually a co-citizen of the ,
thus the 14(a)(3) claim did not invoke diversity or federal question jurisdiction.
Supreme Court held that supplemental JXN was precluded. Court
concluded that scheming s could circumvent the complete diversity rule
if this was permitted; might sue a diverse , knowing that the would
implead a co-citizen of the , and the would then be free to assert
claims against a non-diverse party in federal court.
Codified in 1367(b): removes supplemental jurisdiction over several
claims, including those asserted by s against persons made parties
under Rule 14.
Loophole if a third-party asserts a 14(a)(2)(D) claim against the , the
is then free to assert his/her claims against the third-party because
they will be deemed compulsory counterclaims brought under Rule 13,
which are NOT excluded from 1367.
Clark v. Associates Commercial Corp. (1993)
brought an action for personal injuries and property damage against s, who
filed a third-party complaint for indemnity from the individuals who conducted
the implicated repo.
BLL: a third-party complaint may be brought against a party who may be liable
for all or part of the original s claim against the third-party .
COUNTERCLAIMS AND CROSS-CLAIMS RULE 13

COMPULSORY COUNTERCLAIMS 13(a)
o
o
o
o
o
Arises from the same transaction or occurrence [13(a)(1)(A)] asserted against an

opposing party, and must be asserted in the pending case, otherwise the party loses
the claim and may not assert it in another proceeding.
Policy: serve to force the joinder of transactionally-related rights to relief into a single
case, which is efficient and convenient for the fact-finder.
13(a)(1)(B): a claim is simply not considered compulsory if an otherwise compulsory
claim would require adding another party over whom the court cannot acquire
jurisdiction.
If the counterclaim implicates non-parties who should be joined but cannot be
joined, it is not a compulsory counterclaim.
13(a)(2): if a has already asserted the claim by the time she is sued, her claim need
not be asserted when the sues her.
As always, the claim must then invoke federal subject matter jurisdiction or else it
cannot be asserted.
41

PERMISSIVE COUNTERCLAIMS 13(b)
o
o
o
MAY be asserted by the against the , and is transactionally unrelated to the s

claim against the mirrors the s unlimited right to join claims as in 18(a)
As always, the claim must then invoke federal subject matter jurisdiction or else it
cannot be asserted.
The fact that a permissive counterclaim does not arise from the same transaction or
occurrence as the underlying dispute means that it generally will NOT invoke
supplemental jurisdiction.
However, it is possible because the common nucleus of operative fact is
generally construed as broader than the transaction test; so sufficient factual
overlap between the supplemental claim and the underlying suit is possible.
CROSS-CLAIMS 13(g)
o
o
o
o
o
13(g) is permissive. (may assert the claim)

Requirements
Made against a co-party, AND
Must arise from the same transaction or occurrence.
May include an assertion that the co-party is or may be liable for all or part of the claim
against the party asserting the crossclaim (indemnity or contribution)
Once a cross-claim is asserted, the co-parties become opposing parties if one of them
wants to assert an additional claim against the other, it will then be a counterclaim and
could be compulsory if it arises from the same transaction or occurrence.
As always, the jurisdictional inquiry is a separate step here, undertaken after
determining that the claim is properly asserted under 13(g).
INTERPLEADER RULE 22 AND 28 U.S.C.A. 1335

INTERPLEADER
o
o
o
o
Defined: A procedural device that allows someone in possession of property or money

to force all adverse claimants to that property to litigate the ownership of that property
in a single proceeding.
Policy: solves a many-sided dispute economically and expeditiously, and relieves the
stakeholder from the obligation of determining who has the rightful claim to his money
or property; avoids possible multiple liability from inconsistent obligations, as well as
the expense and delay. Also benefits the claimants in that a limited fun can be
distributed equitably among them.
Timing: in federal court, interpleader may proceed without the claimants having
already won a judgment against the stakeholder. (many states require a judgment first)
2361: part of statutory interpleader; provides that the federal court overseeing an
interpleader case may enter its order restraining the claimants from instituting or
prosecuting any proceeding in any State or U.S. court affecting the stake.
Permits in an injunction against claimants from proceeding in any federal or
state court.
Does not apply in rule interpleader cases but the Anti-Injunction Act implicitly
grants the federal court the power to issue an injunction against a pending state
action in aid of jurisdiction.
SCOPE OF INTERPLEADER
o
Limited only to claims to the stake itself.
42

o
State Farm Fire & Casualty Co. v. Tashire: driver of a truck involved in a horrible
collision carried insurance with State Farm up to $10,000 per person for bodily injury,
and $20,000 per occurrence. State Farm filed an interpleader action, as it was obvious
that the claims against the insured for the collision would exceed the policy limit.
District court permitted the interpleader to proceed and entered an injunction
requiring that all claims against State Farm, the driver, Greyhound, and the
Greyhound bus driver be prosecuted in the interpleader proceeding (including
the tort claims)
Supreme Court modified the injunction to reflect the proper scope of
interpleader, and limit the claims only to those against the fund; the tort claims
are not claims against the stake until one tries to enforce a judgment against the
insurance fund.
PROCEDURE OF INTERPLEADER
o
May be invoked defensively; the (stakeholder) may file a compulsory counterclaim

invoking interpleader and naming the original as a claimant.
13(h) permits the to join as additional parties to the counterclaim any
absentee satisfying Rule 19 or 20.
What happens to the stake during the interpleader?
Statutory stakeholder must deposit the stake with the court or post a bond
with the clerk in a predetermined amount this is a jurisdictional prerequisite.
Rule does not expressly require deposit of the stake or of a bond, but the
court routinely orders this.
RULE INTERPLEADER RULE 22

o
o
o
Provides only a procedural mechanism for interpleader does not affect federal subject
matter jurisdiction or venue requirements.
Personal jurisdiction
Subject matter jurisdiction: requires an independent basis of federal subject matter
jurisdiction
Federal question rarely invoked courts look to whether coercive action by
the stakeholder would invoke federal question jurisdiction
Ex/ escrow accounts claimed under the Small Business Act, funds subject
to federal tax liens.
Diversity treated simply as diversity cases under 1332(a)(1); requires
complete diversity among the stakeholder and the claimants.
Venue: treated as a regular case governed by 1391(a) for diversity and 1391(b) for
federal question.
Any district where all the s reside
Any district in which a substantial part of the claim arose (essentially
meaningless)
Loophole for the stakeholder! 1391(a)(2) and (b)(2) contains a provision
permitting venue in a district where a substantial part of property that is the
subject of the action is situated.
If the interpleader is asserted defensively most courts adopt the idea of
ancillary venue, so as long as venue was proper in the original case by the
claimant against the stakeholder, venue is proper even as to additional claims
involving joinder of additional parties.
STATUTORY INTERPLEADER 28 U.S.C.A. 1335

o
Personal jurisdiction: permits nationwide service of process (2361)
43

o
Subject matter jurisdiction

Diversity requires minimal diversity only that any one claimant be of diverse
citizenship from any other claimant; stakeholders citizenship is irrelevant.
Only scenario where Rule is preferred where all claimants are from
the same state, statutory interpleader will be unavailable, even though
the stakeholder may be diverse from all claimants. Most courts have
adopted the view that the stakeholder is truly a claimant, and will find
that diversity is satisfied here.
Amount in controversy requirement: 1335 reduces the amount to
$500 or more
o Stake deposited must equal the highest amount claimed by any of
the claimants, even if she asserts that a lesser amount is actually in
controversy.
Venue: 1397 provides that venue may be laid in any district where any claimant
resides.
Type
PERSONAL
JXN
VENUE
DIVERSITY
AMOUNT IN
CONTROVERS
Y
STATUTORY
Nationwide
service of
process
District where
any claimant
resides
$500 or more
RULE
Same as state
court in state in
which situated;
service per Rule
4
Residence of any
(IF all s reside
in the same
state) or where a
substantial part
of events
occurred or
property located,
or where any is
subject to
personal
jurisdiction (if
there is no
district where the
action can
otherwise be
brought
(1391(a))
Between 2 or
more claimants
(minimal
diversity)
Between
stakeholder & all
claimaints
(complete
diversity)
INTERVENTION RULE 24
INTERVENTION OF RIGHT 24(a)
o
24(a)(1): a federal statute may confer the right to intervene.
44
In excess of
$75,000

Ex/ 28 U.S.C. 2403 requires that the Attorney General of the U.S. be notified
whenever a case calls into question the constitutionality of any act of Congress
affecting the public interest; then he has the right to intervene.
24(a)(2): provides for intervention of right in the absence of a statute if the absentee
can establish (1) that she claims an interest relating to the property or transaction that
is the subject matter of the action, AND (2) that she is so situated that disposing of the
action may as a practical matter impair or impede the intervenors ability to protect its
interest, AND (3) an existing party does not already adequately represent her interest.
Test of 24(a)(2) significantly overlaps with 19(a)(1)(B)(i) both aimed at
overriding the s party structure to protect an interested absentee from harm to
her ability to protect her interest.
Rule 19 is invoked principally by the , although the Court may raise Rule 19
issues on its own; in contrast, the absentee herself invokes Rule 24.
PERMISSIVE INTERVENTION 24(b)

o
o
24(b)(1)(A): absentee may seek to intervene if a federal statute confers a conditional

right to intervene. (conditional in that their intervention is allowed at the trial judges
discretion)
24(b)(2): allows intervention when the absentee has a claim or defense that shares
with the main action a common question of law or fact.
Claim or defense recognizes that an intervenor may come in as a or a .
Common question standard: quite broad; does not require that the absentee
have any interest in the pending case, or that the common question
predominate simply must be at least one common question presented both by
the pending case and the claim or defense.
Factors for the Court:
Whether the absentee has delayed unduly in seeking to intervene
Whether intervention might prejudice any existing parties
The status of the pending proceedings
PROCEDURE & TIMING

o
24(c): absentee seeking to intervene must serve on all parties (1) a motion to
intervene and (2) her pleading in intervention (even when the case involves
intervention of right)
Absentee thus chooses to participate on one side of the dispute, but may be
realigned by the court.
On timely application under 24(a) and 24(b): addressed to the trial judges
discretion
Factors for Assessing Timeliness:
How long the absentee knew of her interest (or should have known, with
reasonable diligence) before seeking to intervene
The extent of prejudice caused to existing parties by the absentees delay
The extent to which denial of intervention might prejudice the absentee
Unusual facts that augur for or against a finding of timeliness.
JURISDICTIONAL & RELATED ISSUES

o
Voluntary nature of intervention waives intervenors objections to personal jurisdiction

and venue.
45
COMPULSORY JOINDER OF PARTIES RULE 19

THREE-STEP ANALYSIS
1. Assess whether the absentee is a required party under 19(a) (necessary)
2. If required, determine if the absentee can be joined in the pending case
(feasible under 19(b)
- Personal jurisdiction
- Diversity
- Venue
3. If joinder is NOT feasible, determine whether in equity and good
conscience the court should allow the case to proceed without the absentee
or dismiss the case. (indispensable under 19(b))
o Process for assessing a 12(b)(7) motion
REQUIRED (NECESSARY) PARTIES
o
o
Persons whom the did not join in the case, but whose presence is so desirable that
the court will override the s choice by requiring them to be joined if joinder is
possible.
19(a)(1)(A): absentee should be joined if, without her, the cord cannot accord
complete relief among existing parties.
Does not require that the absentee have any interest in the pending case;
mandates joinder to achieve efficiency
Policy: Avoid inconsistent outcomes; promote efficiency by entering a judgment
that effectively resolves the dispute as a whole, obviating the need for other
suits and binding the absentee.
Broadly interpreted: would seem to mean that every time multiple litigation
could result, a party should be joined seems nonsensical otherwise no need
for impleader or intervention.
Narrowly interpreted: invoked only when nonjoinder of the absentee means
that the court in the pending case cannot wrap things up completely among
those who are presently parties also seems relatively useless either the
owes something to or he doesnt; it will wrap up the dispute among existing
parties regardless.
Application: thus courts generally do not rely on 19(a)(1)(A) exclusively to
order the joinder of an absentee; generally used in conjunction with 19(a)(1)(B).
19(a)(1)(B): requires that the absentee claim an interest relating to the subject of
the suit AND that somebody (either the absentee or the would be harmed if the
litigation proceeds without the absentee).
19(a)(1)(B)(i): focuses on the potential harm to the absentees interest;
specifically whether the absentee is so situated that litigating without her may
as a practical matter impair or impede her ability to protect the interest.
Stare decisis effect: occasionally, but rarely, constitutes a relevant
harm.
19(a)(1)(B)(ii): focuses on the potential harm to an existing party in the case;
must be so situated that not joining her might subject a (defending) party to a
substantial risk of incurring double, multiple, or otherwise inconsistent
obligations.
Applicable in suits for equitable relief; could not honor one judgment
without violating another.
46

Interest must be legally protectable and not mere a financial interest or interest
of convenience; a direct stake in the pending litigation.
Helzberg Diamond
FEASIBLE PARTIES
o
o
o
Absentee must subject to service of process (personal jurisdiction inquiry)

May use any long-arm statute available to the state courts of the state in which
the federal court sits.
Bulge rule: service outside the forum within 100 miles of the federal
courthouse (not available for service on an original , but available for necessary
absentees)
Absentee will not object to venue, or joinder of absentee would not make venue
improper. 19(a)(3)
Joinder of the absentee will not deprive the court of subject matter jurisdiction.
Most problems arise with state law claims asserted by or against the absentee,
and the effect on diversity of citizenship.
Alignment: once the court determines that the absentee should be joined, it
must align the absentee in the pending litigation (i.e. must determine whether
the absentees interest is more closely aligned with or ).
Supplemental JXN: will render joinder feasible if it allows the claim to be joined in the
pending case
1367(a): Claims by and against necessary parties generally satisfy this test.
1367(b): applies to cases that invoke diversity, and removes supplemental JXN
over claims by s against persons made parties under Rule 19 OR over
claims by persons proposed to be joined as s under Rule 19
Thus, not available in a diversity case for claims (1) asserted by s
against the necessary party joined as a , or (2) asserted by the
necessary party if joined as a .
Loophole: supplemental JXN statute may help facilitate joinder of
absentees under Rule 19 at least if they are brought in as additional
parties to a counterclaim or crossclaim (under Rule 13); but it does not
help when the absentee is brought in directly under Rule 19.
19(a)(2): if fails to add the absentee after the court determines she is necessary and
joinder is feasible, this provision provides that the court must order the absentee be
made a party.
Involuntary plaintiffs: rarely used by courts to join a party such a party will
be bound by the judgment even if she refuses to participate in the case.
Applied only when the absentee and the are so closely related that the
absentee must allow the use of her name to allow the existing to secure
relief (i.e. suits by an exclusive licensee of a patent patent holder may
be joined as an involuntary )
INDISPENSABLE PARTIES
o
o
o
Persons whom the did not join, and who (because necessary) should be joined, but
who cannot be joined (e.g. because the court cannot get personal jurisdiction over
them)
Court must either (1) proceed with the present litigation without joining the absentee,
or (2) dismiss the present case.
19(b): court determines whether to dismiss is appropriate in equity and good
conscience.
47
1. The extent to which a judgment rendered in the persons absence might

prejudice that person or the existing parties;
Focuses on the probability and severity of prejudice that would result,
rather than the theoretical possibility as emphasized by the 19(a)
assessment.
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. Adequacy of the judgment if rendered in the persons absence
Implicates both the goal of avoiding harm to absentee and , and also the
interest of courts and the public in complete, consistent, and efficient
settlement of controversies looks to the actual result if the case
proceeds.
4. Whether the would have an adequate remedy if the action were dismissed for
non-joinder
Does the have an alternative forum?
Essentially tells that she must give up her federal forum in the interest
of an efficient litigation package in state court that will avoid harm to
and A.
Republic of Philippines v. Pimentel: a holder of most of a dictators assets
instituted an interpleader action; claimants included the Republic of the Philippines and
a commission created by it, as well as thousands suing for human rights violations.
Republic and its commission could not be joined because of sovereign
immunity.
Court concluded that the interpleader could not proceed without them, and
that it had to be dismissed under Rule 12(b)(7).
Necessary under 19(a)(1)(B)(i): if not joined, the assets would be distributed to
others and lost to these claimants.
19(b): claims were not frivolous; in equity and good conscience, and to allow a
sovereign nation to determine in its own courts who owns the assets
absconded by its former leader.
PROCEDURE & POLICY

o
o
o
Almost always raised by the in a motion to join a necessary party, or a motion to

dismiss the case under Rule 12(b)(7).
19(a)(1)(B)(ii): s self-interest dictates that she raise the issue, i.e. wants to avoid
multiple or inconsistent obligations, and will want to force joinder of the absentee; or if
joinder is infeasible, she will want to argue that the case be dismissed under 12(b)(7).
19(a)(1)(B)(i): why would the raise an issue to prevent threatened harm to the
absentee?
If the joinder is not feasible so the case may be dismissed; generally has
nothing to gain other than getting the case dismissed.
19(c): requires a party asserting a claim to state the name, if known, of any person
who is required to be joined if feasible but is not joined as well as the reasons for not
joining that person.
Puts the court in a position to raise necessary parties issues, but in practice it
provides little protection.
Absentee may be protected more effectively by intervention.
48
CLASS ACTIONS RULE 23 AND 28 U.S.C. 1332(d) CAFA

BASIC PRINCIPLES
Walters v. Reno (1998) 23(b)(2) class actions standards for certification

Class action
Brought by or against a representative (or multiple representatives) on behalf of
a group.
Commonly brought as plaintiff class-actions, but defendant class-actions exist as
well.
FRCP Rule 23: governs class action practice in federal court
Class Actions Fairness Act of 2005 (CAFA)
1332(d)(2): grant of subject matter jurisdiction
1332(d)(2)(A): permits the exercise of minimal diversity a single
member of the class must be of diverse citizenship from any (broader
than Ben-Hur)
Amount in controversy is one that exceeds the sum or value of
$5,000,000 exclusive of interest and costs.
o 1332(d)(6): AIC figure is determined by aggregating the claims of
all class members.
1332(d)(3): federal court has discretion to decline subject matter jurisdiction
in the interests of justice and looking at the totality of the circumstances.
Engaged if more than but fewer than 2/3 of the members of the class
and the primary s are citizens of the state in which the case was filed.
Also includes whether the claims involve matters of national or interstate
interest.
*Even if the class satisfies the jurisdiction grant of 1332(d)(2), if a
substantial number of those involved are citizens of the forum and the
claims are mainly local in nature, the federal court might decline to
exercise subject matter jurisdiction and allow the parties to litigate in
state court.
1332(d)(4): requires the federal court to decline subject matter jurisdiction if
more than 2/3 of the members of the class and at least one from whom
significant relief is sought and whose alleged conduct forms a significant
basis for the claims asserted are citizens of the state in which the case is filed.
Class action meeting these requirements is essentially local and should
not proceed in federal court.
1453: permits removal of cases under 1332(d)(1).
Under regular removal (1446(b)), if any is a citizen of the forum removal
is not permitted, and no diversity case could be removed more than one
year after the case was filed in state court.
Neither of these removal restrictions apply in removal of cases invoking
CAFA.
1712 Coupon settlements requires that when a proposed settlement of a
class action in federal court provides coupons for class members, the attorneys
fees attributable to the award of coupons must be based upon the actual value
of the coupons to the class members.
Intended to avoid the award of large counsel fees to lawyers who procure
for the class coupons that are essentially worthless.
1713 settlements in which a class member is required to pay class counsel,
resulting in a net loss to the class member, can be approved only if the court
49
makes a written finding that nonmonetary benefits to the class member

substantially outweigh the monetary loss.
1714 prohibits approval of a settlement that discriminates in favor of class
members geographically situated closer to the court than others.
1715 allows governmental input on the desirability of the settlement.
Policy
Efficiency, Consistency, Empowerment
DUE PROCESS HOW CAN CLASS MEMEBRS BE BOUND BY A JUDGMENT?
Hansberry v. Lee (1940)

Due process provides that class members can be bound by a judgment ONLY if
they are truly members of the same class as the representative.
Concerned the enforcement of a racially restrictive covenant in a subdivision in
Chicago forbidding homeowners in the subdivision (all of whom were white) from
renting or selling their property to non-whites.
Burke v. Kleinman white homeowner who did not favor the racially restrictive
covenant rented property to an African American other property owners sued
to enjoin the rental, stipulating that covenant had been signed by the requisite
95% of owners and was therefore effective.
In fact, only 54% had signed and the covenant never should have gone
into effect.
Based on the 95% stipulation, the injunction was granted and the
covenant was upheld.
Here, s proved that only 54% of relevant homeowners had signed.
SCOTUS held that the people selling to the Hansberrys were NOT bound by the
class action judgment in Burke.
A judgment cannot bind class members unless they are adequately represented.
s in Burke sought to enforce the restrict covenant could not bind those
homeowners who opposed enforcement of the covenant.
RULE 23(a) - REQUIREMENTS OF ANY CLASS ACTION
Should contain reasonable temporal and geographic limitations on the class in the
complaint, to convince the court from the start that the class will be determinable.
Numerosity 23(a)(1)
Class must be so numerous that joinder of all members is impracticable.
Generally, more than 40 is sufficient.
Relevant Factors geographic dispersion, ability of members to pursue
individual litigation, other issues that affect an individuals incentive or ability to
pursue individual litigation (limited financial resources, mental inability, inability
so speak English)
Phillips Petroleum Co. v. Shutts
Involved a class of claimants whose claim average $100
SCOTUS concluded most of the s would have no realistic day in court if a
class action were not available (speaks to ability to pursue individual
litigation).
Commonality 23(a)(2)
Questions of law or fact common to the class.
50
Becomes at issue primarily in the context of 23(b)(3) class actions, where

common questions must predominate over individual questions.
All this rule requires is some commonality exists among the class members.
Typicality 23(a)(3)
Mandates that the representatives claims be typical of those of the class.
Helps to ensure adequate representation (the next requirement)
Without a typical claim, it is difficult to see what incentive the representative
would have to assert the class claims vigorously
Focus on the essential characteristics of the claim - should also suffer the
same general kind of harm suffered by the class at the hands of the same s as
the class membe.rs
Protecting the Class Interests 23(a)(4)

Representative must fairly and adequately protect the interests of the class.
Owes a fiduciary duty of loyalty to the class - her interests cannot be
antagonistic to those of the class mere differences of opinion concerning
litigation strategy will not defeat certification
May not be adequate if the representative is subject to a unique defense, is
deemed to have suspect credibility
Court must also be convinced that the representative has the financial ability to
prosecute the litigation.
Without adequate representation, a class action would violate the constitutional
guarantee of due process (Hansberry)
RULE 23(b) TYPES OF CLASS ACTIONS
23(b)(1) Prejudice Class Action

Mandatory class action - No opt-out
Individual notice not required
23(b)(1)(A) permits a class certification if individual suits would create a risk of
inconsistent or varying adjudications with respect to individual class members
that would establish incompatible standards of conduct for the party opposing
the class.
Focus on the effects on s.
If the putative class members sue individually (not in a class), might it
subject the to incompatible standards of conduct?
23(b)(1)(B) permits class certification if individual suits would create a risk of
adjudications with respect to individual class members that, as a practical
matter, would be dispositive of the interests of the other members not parties to
the individual adjudications or would substantially impair or impede their ability
to protect their interests.
Focus on the would-be class members
If the putative class members sue individually, might some be harmed as
a practical matter?
Typically involves a limited fund
23(b)(2) Equitable Relief

Mandatory class action - No opt-out
Individual notice not required
51
Permits certification of a class action when the has acted or refused to act
with respect to the entire class so that final injunctive or corresponding
declaratory relief is appropriate respecting the class as a whole.
Courts agree that the class must seek predominantly injunctive or declaratory
relief, but disagree about how to determine when money damages become too
prominent to be permissible.
If damages flow automatically from the grant or injunctive or
declaratory relief, and can be readily calculated, they may be recovered.
23(b)(3) Damages Class Action

Class members may opt-out.
Notice to all class members who can be identified with reasonable
effort.
Permits a class action if common questions predominate and if the court finds
that a class action is the superior way to adjudicate the controversy.
Predominance Questions of law or fact common to class members must
predominate over any questions involving only individual members.
Often involve the s conduct and class-wide defenses, while individual
questions often relate to causation and damages as well as individual
defenses (i.e. comparative fault)
Easier to find predominance of common questions if one defines the class
relatively narrowly.
Castano v. American Tobacco Co.
o Attempted certification of a nationwide class of nicotine-dependent
persons numbering in the millions.
o Complaint purported to rely on 9 causes of action, with huge
variations among states.
Superiority must find that a class action is superior to other available methods
for fairly and efficiently adjudicating the controversy.
Class members interests in individually controlling their cases (i.e. high
stakes for each claim)
Likely difficulties in managing a class action
NOTIFICATION TO CLASS MEMBERS AND OPTING OUT
23(c)(2)(A) permits the court, in its discretion, to give notice in 23(b)(1) and 23(b)(2)
cases.
Does this lack of notice violate due process?
Given the close relationship of the class members, adequacy of representation
without notice satisfies due process.
23(c)(2)(B) applies ONLY to 23(b)(3) classes.
Court is required to direct notice to class members, including individual notice
to all members who can be identified through reasonable effort.
Best notice practicable under the circumstances stricter than Mullane which
did not require individual notice to every person whose interest could be affected
by the judgment, even if they could be identified through reasonable effort.
Requires the notice to inform class members of the nature of the action, the
definition of the class, the class claims, issues, or defenses, that a class member
may enter an appearance through her own counsel if she desires, that a class
member may opt out (and when and how members may elect to opt out), and
that the class judgment will bind class members who do not properly opt out.
52

Costs of notice borne by the class representative undoubtedly makes it more
difficult to bring a class action.
23(e)(1) concerns notice of a settlement or dismissal of a class action
FILING & CERTIFICATION OF A CLASS ACTION UNDER RULE 23
Definition of the Class and Appointment of Class Counsel

23(c)(1)(B): if a court grants certification, it enters an order that must define
the class and the class claims, issues, or defenses, and must appoint class
counsel under 23(g).
23(c)(1)(C): expressly recognizes that an order regarding certification may be
altered or amended before final judgment.
Certification order is conditional court is able to react as the litigation
unfolds to alter the class definition or even to decertify.
Court continually monitors the class action to ensure that the interests of
class members are adequately represented and to consider its continuing
viability.
JURISDICTION IN CLASS ACTIONS
Subject Matter Jurisdiction

Federal question 1331
Diversity CAFA requires only minimal diversity and over a $5 million
aggregate amount in controversy (rather than $75K for each individual)
Ben-Hur established that only the class representatives citizenship must
be diverse from that of the opposing party.
Amount-in-controversy in diversity
Zahn required that the claim of each class member, individually, must
meet the AIC requirement (wholly inconsistent with Ben-Hur)
Exxon Mobil v. Allapattah (2005)
o Concluded that 1367 overruled Zahn if the representatives claim
satisfies diversity requirements (minimal diversity & AIC), then
supplemental jurisdiction can be exercised over the remaining
related claims by class members, even if those claims do not
exceed $75,000.
o 1367(b) does not withdraw supplemental jurisdiction from claims
brought in diversity under Rule 23.
o Lingering issue 1367 may only overrule Zahn where a single is
involved - 1367(b) removes supplemental jurisdiction over claims
joined by s against persons made parties under Rule 20, so if a
class asserts a claim against multiple s, this provision would
deprive the court of supplemental jxn over the claims by class
members.
Personal Jurisdiction
Minimum contacts does not apply as to class-action s (Phillips Petroleum v.
Shutts)
Limited holding applicable only to b(3) classes.
A court may enter a judgment that binds absent class members as long as
certain due process requirements are met
Notice and an opportunity to be heard
Right to opt out (at least for money damages 12b3 class actions)
Adequate representation
53
Choice of Law
Shutts SCOTUS held that the law of a state may only apply to parties who have
some significant connection with that state.
Raised the possibility of sub-classes.
Venue
No special provision for class actions
1391 applies
JUDGMENTS, SETTLEMENTS, & DISMISSALS
Rule 23(e): Class action settlements and voluntary dismissals require court approval.
23(e)(2): requires that the court hold a hearing to determine whether the proposed
settlement is fair, reasonable, and adequate.
Absent class members are unable to consent judge given the responsibility to
protect their interests in a settlement.
Applies only if the court has actually certified the clas, and only if the settlement,
dismissal, or compromise affects class issues.
23(e)(1) - Class members must get reasonable notice
23(e)(4) court may refuse to approve settlement of a certified 23(b)(3) class
unless the settlement affords a new opportunity request exclusion to individual
class members who had an earlier opportunity to request exclusion and did not
do so.
Thus, those who do not like the settlement terms are not bound.
23(e)(5) - may voice any objections.
Amchem: court must certify the class before approving the settlement.
Settlement Class Actions/Settlement-Only Class Actions
Parties ask the court to certify a class action solely for purposes of the
settlement already negotiated ask the court for settlement approval but only if
the class is certified.
may be willing to pay a large amount of money to settle the dispute, but only if
the settlement truly resolves the whole thing.
Concerns that s counsel lack any real leverage in these negotiations because
there has not been certification yet, and cannot make a realistic threat of going
to trial.
Nonetheless, court may approve a settlement class action as long as it finds the
settlement fair under 23(e) AND finds that the class meets the requirements of
23(a) and 23(b).
SUPPLEMENTAL JURISDICTION
BASIC PRINCIPLES
o
o
o
Supplemental jurisdiction is never available to get the original case itself into federal
court; it is only available for additional claims after the original claim meeting a basis
for federal jurisdiction has been asserted.
Supplemental jurisdiction is not needed if there is a standard independent basis of
subject matter jurisdiction over the claim.
Constitutionality: when the files an original claim that invokes federal subject
matter jurisdiction the federal court takes jurisdiction over the entire case or
controversy claims must be so closely related to the claim that invoked the federal
courts jurisdiction as to be considered part of the same or controversy as that claim.
54

UNITED MINE WORKERS v. GIBBS
o
Additional claim brought under state law derived from a common nucleus of operative
fact with the claim that invoked federal subject matter jurisdiction.
Slightly broader than same transaction or occurrence
Discretionary Factors in Declining Jurisdiction
FINLEY v. UNITED STATES

o
Court reversed the presumption in favor of supplemental jurisdiction in the absence of

congressional action; there could be no supplemental jurisdiction unless Congress
affirmatively granted it.
POLICY JUSTIFICATIONS
o
o
o
Efficiency
Convenience
Consistency of Outcome
1367
o
o
o
(a) Grant of Supplemental Jurisdiction

Over all claims asserted in a federal civil action if they share a common nucleus
of operative fact with the claim that invoked federal subject matter jurisdiction
(essentially a codification of Gibbs), and includes claims involving additional
parties.
(b) Withdrawal of Supplemental Jurisdiction in Certain Instances
Applies only in cases in which the jurisdiction-invoking claim is a diversity claim asserted under 1332.
Applies only in diversity cases with respect to claims asserted by plaintiffs of
parties subsequently joined on the plaintiffs side of the litigation.
Claims by s against persons made parties under Rule 14, 19, 20, or 24
Claims by persons proposed to be joined as s under Rule 19
Claims by persons seeking to intervene as s under Rule 24
Thus claims satisfying 1367(a) asserted in a diversity case by a
defendant (or a party joined on the s side) will invoke supplemental
jurisdiciton.
(c) Discretionary Factors in Declining to Exercise Supplemental Jurisdiction
Claim raises a novel or complex issue of State law
Claim substantially predominates over the claim that invoked federal subject
matter jurisdiction
Court has dismissed all claim over which it has original jurisdiction
In exceptional circumstances, other compelling reasons for declining jurisdiction.
Majority view is that 1367(c) replaced the Gibbs and limited the scope of
discretion enjoyed
Once one of the factors under 1367(c) applies, the court may look to the
full range of Gibbs animating values of judicial economy, convenience,
and fairness to litigants in deciding whether to decline jurisdiction.
Minority view is that 1367(c) does not restrain the common law discretion of
Gibbs, and seem to conclude that the Gibbs factors operate independently of the
statute.
(d) Tolling Provision
Statute of limitations is tolled while the case is pending in federal court and for
30 days after dismissal.
(e) Defines State
55
56
V. WHAT LAW APPLIES IN FEDERAL COURT: OF THE ERIE

DOCTRINE AND DIVERSITY JURISDICTION
STATE LAW IN DIVERSITY ACTIONS THE PROBLEMS PRESENTED BY ERIE
BASIC/BACKGROUND PRINCIPLES
Rules of Decision Act (28 U.S.C. 1652)
The laws of the several states, except where the Constitution or treaties of the U.S.
or Acts of Congress otherwise require or provide, shall be regarded as rules of
decisions in civial actions in the courts of the U.S., in cases where they apply.
Rules Enabling Act (28 U.S.C. 2072)
(a) Congress delegates to SCOTUS the congressional authority to promulgate rules
of practice and procedure for the federal courts.
(b) FRCP shall not abridge, enlarge, or modify any substantive right.
STATE OR FEDERAL LAW IN DIVERSITY ACTIONS, AN INTRO TO THE PROBLEMS
PRESENTED BY ERIE
Swift v. Tyson (1842)
Federal courts did not have to apply state law on all aspects of a diversity
case.
Interpreted laws of the several states to include only state statutes and
state common law of local concern.
Other matters federal courts sitting in diversity free to apply general
common law.
Excludes judicial decisions.
Based upon misguided notions of one true common law (natural law) whose
content can only be determined by the federal bench.
Key shortcoming: vertical disuniformity; states could apply a different version
of general common law not compelled to adopt federal courts reasoning.
Forum shopping
Black & White v. Brown & Yellow
Erie RR v. Tompkins (1938)
Case turned on s status as invitee/trespasser, RRs corresponding duty of
care
Under state law trespasser; federal common law invitee
Thus, claim brought in federal court
Doctrine of Swift had failed in practice universal general common law had
not emerged
Promoted discrimination between citizens and non-citizens
Held RDA constitutional, and Swift RDA application unconstitutional
Appears to rest on 10th Amendment Swift was an unconstitutional grab by
the federal courts of power vested in the states (i.e. to establish its own
applicable rules of common law)
No constitutional authority for the federal government to declare
substantive rules of common law
No such thing as federal general common law
57
State law must govern on matters of general common law.

Policy of litigant equality similarly situated persons should be treated alike
Governing law should not differ depending upon whether the case is in
federal or state court.
Klaxon v. Stentor Electric Manufacturing Co. (1941)
Federal courts sitting in diversity must apply choice of law rules of the state
in which that federal court sits.
Choice of law rules deemed substantive and constitute rules of decision as to
which state law must govern.
Sibbach v. Wilson (1941)
Concerned validity of FRCP Rule 35 requiring a person to submit to a physical
examination to determine the nature and extent of alleged injuries argued
that state law should govern.
Just because a procedural rule affects a substantial and important right does
not necessarily exceed the rulemaking authority granted by the REA.
substantive is not the same as substantial
Test must be whether a rule REALLY regulates procedure (the judicial process
for enforcing rights and duties recognized by substantive law and for justly
administering remedy and redress for disregard or infraction of them.
Challenged rule comports with the policy of uniformity Congress sought to
introduce in the federal system.
Guaranty Trust Co v. York (1945)
Facts
claim asserted in federal court under diversity
Barred under state statute of limitations
District court allowed claim to proceed based on doctrine of laches.
SCOTUS overrules Erie required that the district court apply the state
statute of limitations.
Form and mode of enforcement federal courts should be free to prescribe
the way in which substantive rights are enforced.
Outcome-determinative federal court cannot afford recovery if the right to
recover is made unavailable by the state; outcome of the litigation should be
substantially the same.
Applied unevenly by lower courts
Required federal courts to ensure that the outcome (who wins/loses)
not differ from the result in state court.
Superior interpretation - Outcome should be the same so far as legal
rules determine the outcome of a litigation.
Triple play cases show pendulum swinging too far to the state side of things
reading York too literally.
Ragan v. Merchants Transfer & Warehouse Co. (1949)
Question was when an action is commenced for purposes of tolling the
statute of limitations.
Statute of limitations expired after the filed the case but before was
served with process.
Under state law, claim would have been barred (statute tolls from date
of service)
Under FRCP, Rule 3 tolls from date of filing of complaint.
SCOTUS held state law had to apply based on outcome-determinative test.
58

Here, federal law would expand a state law-created right (under statute of
lim.)
Woods v. Interstate Realty Co. (1949)
Question was whether state door-closing statute should be followed by
federal court.
MS law required corporations formed in other states to register before
doing business in MS otherwise the right to sue in MS courts is
waived.
SCOTUS held state law had to apply based on outcome-determinative test.
Cohen v. Beneficial Life Insurance Co. (1949)
SCOTUS held the federal court must apply the state-law bond requirement,
despite being contrary to Rule 23.
MODERN EFFORTS TO ENUNCIATE A WORKABLE TEST

CONTEMPORARY PRINCIPLES
Byrd v. Blue Ridge (1958)

Facts
P brought diversity suit on the theory that he was not an employee of the
and thus was not limited to workers compensation recovery.
Question of whether was a statutory employee was crucial issue
Under state law, the judge made this determination.
Under federal law, preference was for jury determination.
Is the state rule bound up with state-created rights and obligations in such a way
that its application in federal court would be required?
State rule here merely a form and mode of enforcement.
Policy counsels, but does not require, the federal courts to apply state law in
cases in which failure to apply state law will be outcome determinative.
Gives context to the York analysis as to issues of form and mode, and when
failure to apply state law would be outcome determinative, federal court will
apply state law in the absence of other considerations.
Federal countervailing interests
As an independent system for administration of justice, federal courts have
an interest in keeping essential characteristics of that system free from
interference by state law.
Here, division of labor between judge and jury (influenced by 7 th Amendment)
and strong interest in allocating fact-funding functions between the two.
Justified in ignoring the state rule no strong state interest.
Summary of Byrd Test
If ignoring state law on this point will be outcome-determinative, the federal
court will apply state law.
But it will NOT do this if it would violate some interest of the federal courts as
a separate judicial system.
Balance the relative interests of the systems.
Hanna v. Plumer (1965)
Question was did Erie require the federal court to apply state law in this instance, or
was the federal court free to ignore state law and apply Rule 4?
MA law required personal service on an executor no substituted service
FRCP allows substituted service of process.
59
Hanna I - Modified Outcome-Determinative Test

Twin Aims of Erie guide RDA inquiry
Discouragement of forum shopping
Avoidance of inequitable administration of the laws.
Shifts focus to the outset of the case whether the difference between
applying state law and ignoring state law would influence the in choosing
the federal forum.
Looking at the rule in the abstract
Here, no would sue in federal court just to avoid the personal service of
process requirement of state law.
Take-away UNCLEAR if this supplements or replaces York.
Hanna II - REA Prong
Extensive process of adopting FRCP gives them presumptive validity under
both the constitutional and statutory constraints.
Incidental effects on substantive rights do not violate 2072(b)
Where there is a federal directive on point that (1) applies to the facts of the
case, and (2) is valid , the Supremacy Clause requires its application.
Harlans concurrence: thinks Hanna analysis goes too far
primary inquiry should be whether state law must govern when the issue is
one that would substantially affect those primary decisions respecting
human conduct.
Hanna I RDA Prong - Modified Outcome

Determinative Test
NO FEDERAL RULE ON POINT
Twin Aims of Erie
Avoid forum shopping
Inequitable administration of laws
Look at the rule in the abstract Harlan-type
analysis
Hanna II REA Prong
FEDERAL RULE ON POINT
Is there a direct collision? & does the federal rule apply?
If so, is it arguably procedural?
Does it violate 2072?
APPLYING HANNA
When is a federal directive on point?
Turns on whether the federal directive is read broadly or narrowly.
Greater sensitivity to state interests counsels a narrower interpretation of federal
directives.
Avoids thorny REA analysis about the validity of FRCP.
Generally leads SCOTUS to conclude that the rule is not on point so Hanna II
analysis does not apply.
Walker v. Armco Steel (1980) narrow reading
Indistinguishable facts from Ragan
Upheld Ragan by concluding that Rule 3 did not actually address tolling at all
instead, defines the commencement of a suit ONLY for purposes of applying
the FRCP and not for tolling of statute of limitations purposes.
60

Thus, Rule 3 was NOT on point.
Hanna I RDA analysis state law governs.
Looked to the plain meaning of Rule 3 and read it quite narrowly in order to
avoid a conflict between FRCP and state law on the topic.
Semtek v. Lockheed Martin Corp. (2001) narrow reading
Addressed Rule 41(b) governing involuntary dismissals providing, with some
exceptions, that such dismissals are to operate as adjudications on the
merits, with prejudice.
Read Rule 41(b) narrowly, holding that it meant only that a case could not be
refiled in another federal court, and that a dismissal did not bar refiling in
state court.
Broad interpretation of Rule 41 would potentially run afoul of REA by
modifying a substantive right.
Burlington Northern RR v. Woods (1987) broad reading
Rule 38 of FRAP, permitting (but not requiring) a Court of Appeals to impose
an award of double costs if it found an appeal to be frivolous.
Conflicted with state law requiring that an appellant be fined 10% of
the judgment.
Federal rule governs would deprive federal judges of discretion in imposing
sanctions.
Stewart v. Ricoh (1988) broad reading
Contract with a forum selection clause such clauses NOT recognized by
state law.
1404 on point and directed federal courts to consider the existence of a
forum selection clause as a factor in favor of transfer under the statute.
Problematic Holding
Nothing on the face of 1404(a) indicates the relevance of forum
selection clauses to transfer, nor did the legislative history.
Now there are inequitable results in Alabama based on whether suit is
brought in state/federal court such a clause not enforceable in state
court.
Illustrates the harshness of Hanna II analysis no opportunity to look to
outcome determination, twin aims, or balancing of state/federal interests.
Here, SCOTUS ran roughshod over legitimate state interests.
Gasperini v. Center for Humanities, Inc. (1996)
Divergent standards for reviewing excessiveness of jury awards
Federal standard NOT included in Rule 59 derived from case law as a
shocks the conscience standard.
State law applied more intrusive test deviates materially from what
would be reasonable compensation
o Also required appellate review de novo.
State goals were to invite more careful judicial scrutiny of verdicts, and limit
the outcome of litigation by limiting the range of jury awards.
Concluded Rule 59 not on point permits new trials for various reasons
including excessive verdicts, but gives no standard for determining when
excessiveness occurs.
Thus, no federal directive on point apply Hanna I
Determines that a statutory cap on damages would be substantive, thus the
deviates materially standard is substantive.
61

Applies twin aims and determines that ignoring state law would cause
s to flock to federal court.
Concludes that NY provision is not binding on federal courts countervailing
federal interest in Re-Examination Clause of 7 th Amendment
Scalia Dissent does not achieve uniformity allows 2 bites at the apple in
state court
MA agrees doesnt really get the Gasperini holding.
Is the federal directive valid?
Does it fall within the constitutional authority of Congress to prescribe procedural
rules for the federal courts?
Requires only that the rule be arguably procedural.
Does it fall within the REA?
2072(a) must deal with practice and procedure
2072(b) cannot modify, abridge, or enlarge a substantive right
Harlan analysis useful here
Shady Grove (2010)
Scalia Rule 23 governs manner and means by which rights are forced doesnt
affect the underlying cause of action, just makes it easier to collect.
May have an incidental effect on rights, but thats just the nature of
procedure.
Gives really strong reading to Sibbach does this really regulate procedure?
Forum shopping OK when analysis falls into the REA prong just the natural
result of having two systems.
Stevens reading governs dont read state law as broadly/deferentially as Ginsberg
assumes.
Thinks you do have to balance the state interest under REA analysis.
Gives broad reading to 2072(b) thinks Scalia is reading FRCP too broadly,
and Ginsberg is reading state law too broadly.
ERIE & HORIZONTAL CHOICE OF LAW

Rule: When applying state law, federal court sitting in diversity must predict how the
highest court of the state would rule.
Mason v. Emery Wheel Works
Relied on dicta by the MS court indicating that it would be wiling to overrule the
privity requirement.
62
VI. THE EFFECT OF PRIOR ADJUDICATIONS: RES JUDICATA

(CLAIM PRECLUSION) AND COLLATERAL ESTOPPEL (ISSUE
PRECLUSION)
CLAIM PRECLUSION
BASIC PRINCIPLES
Requirements
Same parties
Valid, final judgment on the merits from first case
Both cases based on the same claim
Same Parties
If Case 1 and Case 2 are brought by the same claimant against the same .
Or those in privity with the parties those so closely related that litigation by
one ought to bind the other.
Reflects constitutional due process concerns cannot be bound by a judgment to
which you were not a party, or without adequate representation.
Valid, Final Judgment On the Merits
Valid addresses the competence of the court in Case 1
Generally concerned with personal jurisdiction and subject-matter
jurisdiction.
Does not reflect whether the first judgment was correct proper means to
deal with that is through DIRECT APPEAL.
Final a judgment that has ended the litigation on the merits, leaving nothing else
for the trial court to do.
Same basic requirement most judicial systems use for determining whether
an order can be appealed.
What if Case 1 is on appeal when Case 2 is filed?
Majority view: before the appellate court has acted, it is generally
held that the final judgment is entitled to preclusive effect.
Minority view: pending appeals do not create preclusion.
On the merits judgment must be based on the underlying dispute who did
what, who showed they were entitled to judgment
Generally, cases resolved on jurisdictional or procedural bases are NOT on
the merits.
Does not literally mean on the merits more accurate that the court had the
opportunity to decide on the merits, even if it did not actually do so.
Includes summary judgment, default judgments, and most involuntary
dismissals.
Rule 41(b)
If involuntary dismissal based upon lack of jurisdiction, improper
venue, or failure to join a party under Rule 19 NOT an adjudication
on the merits
63

If involuntary dismissal based upon s failure to comply with FRCP
deemed an adjudication on the merits and given claim preclusive
effect unless the court provides otherwise.
o Why? had an opportunity to present her case for consideration
on the merits and failed to do so.
Rinehart v. Locke
Semtek v. Lockheed Martin (2001)
Rule 41(b) not to be read literally any dismissal not under this rule
operates as an adjudication on the merits would mean every involuntary
dismissal other than those for jurisdiction, venue, or Rule 19 are adjudications
on the merits.
Dismissal in Case 1 expressly stated that the dismissal was on the merits and
with prejudice.
But SCOTUS held that the original federal judgment was not entitled to claimpreclusive effect.
41(b) not aimed at preclusion means only that the cannot refile the same
claim in the same federal district court that entered the judgment of
dismissal.
If it did, potential Erie problems and REA violation by proscribing a
substantive rule.
Governed by federal common law which in this instance, would adopt the
law of the state in which the federal court sat.
Ultimately, the question of whether a federal judgment should result
in claim preclusion in a different state court will depend upon how
the rendering state court would have treated it as on the merits for
preclusion purposes.
Same Claim
Modern trend: defines claim broadly reflects more liberal rules of pleading and
joinder, leaving less of a need for the legal system to provide a with an
opportunity to bring a second case.
Majority view Transactional Test
RST a claim encompasses all rights to relief with respect to all or any part
of the transaction, or series of connected transactions, out of which the
action arose.
Facts closely connected in time, space, origin, or motivation, and
whether, taken together, form a convenient unit for trial purposes.
i.e. claims for property damage and personal injury from the same auto
collision should both be brought in Case 1, or the other will be claim
precluded.
Minority view - Primary Rights Theory
Claimant has a separate claim (and therefore can file a separate case) for
each right violated by the .
i.e. claims for property damage and personal injury from the same auto
collision involve the invasion of 2 different rights, and thus can be brought in
2 separate suits.
Considerations: should the judicial system countenance separate suits,
considered pragmatically? Should the have to defend more than one action?
Should the be expected to package all of these into one claim?
Policy: transaction-based approach promotes efficiency
64

Rights-based seems wasteful of judicial resources however, issue preclusion
may streamline Case 2, or influence settlement of Case 2.
Other approaches to same claim same evidence test, arising from a single
wrongful act.
Manego v. Orleans Board of Trade (same claim)
EXCEPTIONS TO THE OPERATION OF CLAIM PRECLUSION

Policy: may be good policy reasons for withholding an aspect of a claim, or in which due to
procedural or substantive limitations, a party may be involuntarily forced to split his case,
or in which application of rule against splitting causes of action results in unfairness.
When either the or the court in Case 1 agrees to allow the claimant to split her
claim.
Allows parties to simplify litigation by limiting it to one aspect of a claim,
while negotiating settlement to the remainder of the claim pending outcome.
might waive a claim preclusion objection by acquiescing in multiple suits.
Jurisdictional competence exception: When claimant could not have sought all rights
to relief for her claim because of limitations imposed on the court in Case 1.
I.e. brings a claim in small-claims court (<$1500) for property damage,
then brings a second claim for $15,000 in different trial court (>$1500) that
could not have been heard in the first suit.
Preclusion should not apply IF the state has a jurisdictional competency
requirement.
Federated Department Stores, Inc. v. Moitie
SCOTUS rejected an exception based on broad concepts of fairness
Purchasers brought suit against department store operators alleging violations of
federal antitrust law dismissed for lack of standing.
Group 1 appeals; Group 2 brings a second case reasserting their original claim in
state court.
Group 2 case removed to federal court and dismissed under claim preclusion
then appealed the dismissal.
While both appeals pending, SCOTUS decided a case that changed the rules about
antitrust injury, allowing both Groups the ability to show sufficient injury to invoke
the laws.
SCOTUS held Group 2 s barred by claim preclusion, rejecting open-ended
exceptions to claim preclusion and asserting the importance of the doctrine as a key
principle of justice.
Appropriate vehicle is DIRECT APPEAL.
PRECLUSION IN STATE-FEDERAL COURT ADJUDICATIONS (1738 - FULL

FAITH & CREDIT)
BASIC PRINCIPLES
Art IV 1 Full Faith & Credit Clause
Narrow provision applying only in state-to-state preclusion scenarios
Requires that each state give full faith and credit to judicial proceedings of
every other State.

1738
Provides that a state or federal court must give the same full faith and credit
as would be given by the state court that entered judgment in Case 1.
Applies directly only to state-to-state preclusion, and state-to-federal preclusion.
65
State-to-State Preclusion
Court in Case 2 must apply the preclusion law of the state of the rendering court
from Case 1.
Uncertainty as to how far this extends does a state court in Case 2 have to
adopt the state court in Case 1s views on nonmutual issue preclusion? Or only
core rules relating to preclusive effect?
State-to-Federal Preclusion
1738 requires that a federal court give the same full faith and credit to the state
court judgment in Case 1 as that court would do.
Marrese v. American Academy of Orthopaedic Surgeons
Case 1 - Group of surgeons sued a professional association in IL state
court alleging violations of state law judgment render against them.
Case 2 same parties, brought in federal court alleging violations of
federal antitrust law (under exclusive federal jurisdiction)
Should an exception to the preclusion doctrines be recognized where the
state court in Case 1 could not have entertained a second claim falling
under the exclusive jurisdiction of the federal court?
Matsushita Electric Industrial Co. v. Epstein
Case 1 class action in DE state court asserting only state law claims
pertaining to fraudulent behavior in securities transactions
Case 2- class action in federal court in CA asserting federal securities law
claims involving the same transaction (under exclusive federal
jurisdiction)
SCOTUS held that DE law governed the question of whether Case 2 should
be dismissed under claim preclusion.
o Court has to determine whether the rendering court would apply
claim preclusion as to assertions that simply cannot be made in
state court.
Ultimately concluded that the federal action had to be dismissed under
the claim preclusive effect of the DE judgment.
SCOTUS sees the full faith and credit statute as a strict command to give the
judgment from Case 1 truly the same full faith and credit it would receive in the
rendering court.
Could join all claims in federal court in Case 1 promotes efficient joinder
thus, when s decide to go to state court first, they run the risk of losing
a federal forum for their federal claims.
Federal-to-State Preclusion
Governed by federal common law.
Semtek v. Lockheed Martin
Case 1- filed in CA state court, removed to federal court under diversity,
dismissed as barred by CA statute of limitations.
Case 2 filed same claim in MD with a longer statute of limitations.
SCOTUS held that the MD court in Case 2 must apply federal common law
to determine whether Case 2 ought to be dismissed under claim
preclusion.
66
Thus, federal law governs to determine the preclusive effect of a judgment

entered by a federal court but based upon state law.
o Federal common law would usually adopt the preclusion law of the
state in which the federal court sat in Case 1.
Invoked Erie concerns finding use of the state rule would reduce the
incentive for litigants to shop for a federal forum in hopes of gaining
access to different preclusion rules.
MD court in Case 2 should dismiss under claim preclusion only if CA law
would dictate that result.
Left open the possibility that federal law would ignore state law when
there is a federal interest justifying the crafting of a federal rule (i.e. willful
violation of discovery FRCP might properly result in preclusion under
federal law regardless of state law)
Federal-to-Federal Preclusion
Generally, federal common law will govern the preclusive effect of the judgment.
What about where the original federal court was sitting in diversity and decided
Case 1 on the basis of state law?
Should follow Semtek approach federal court in Case 2 would apply federal
common law to determine the preclusive effect of the judgment from Case 1,
and federal common law will often incorporate state law of the state in which the
rendering court sat.
ISSUE PRECLUSION/COLLATERAL ESTOPPEL

BASIC PRINCIPLES
Applies only to preclude re-litigation of an issue that the parties actually did litigate and
the court determined.
Does not in itself cause dismissal simply streamlines the number of issues to be
litigated in Case 2
Ensures that the courts do not relitigate something that has already been determined by a
competent court
Inconsistent results
Requirements
Final, valid judgment on the merits
Same issue
Issue essential to the judgment
Due process asserted only against one who was a party
Mutuality
Final Valid Judgment ON the Merits

Same as for claim preclusion
Same Issue Litigated and Determined

Litigated Case went to trial and evidence presented on a particular issue (even
if insufficient evidence)
Does not include dismissals with prejudice, default judgments, or facts
admitted in pleadings.
67

Summary judgment CAN carry issue preclusive effect determines that there
is no material factual dispute is an adjudication on what facts exist and
constitutes litigation.
Determined concerns presentation of alternative theories of recovery,
alternative defenses, presentation of evidence on issues ultimately not submitted to
the fact-finder
Generally made clear in the findings of fact and conclusions of law, or jury
verdict.
Same Issue depends on broad/narrow characterization of the issue
i.e. auto collision judgment entered for with a finding that he was not
speeding is the issue just speeding, or is it a broader legal conclusion about
negligence?
RST: instructs the court to look at such things as the degree of overlap
between the evidence or arguments made in Case 1 and Case 2, whether
new evidence or argument in Case 2 involves the same rule of law as Case 1,
whether pretrial preparation in Case 1 could have reasonably embraced the
new evidence or argument in Case 2, whether there is a close relationship
between the claims asserted in Case 1 and Case 2.
Tends to allow a to pick and choose among potential defenses, retaining
others for another day.
Essential to the Judgment
Emphasizes the difference between the issue decided and the judgment entered in
the case.
Ask: if the finding on this issue had come out the other way, would the judgment be
the same?
Alternative Holdings
Traditional approach: holds that both alternative findings are essential.
RST/modern approach: alternative holdings are deemed not to be
essential, so NEITHER are entitled to issue preclusion (unless one or both are
expressly upheld on appeal)
Policy: because the alternative decision was not necessary to the
decision, it might not have been as fully considered by the factfinder,
or to protect the losing litigant (with 2 negative findings) from being
dissuaded from seeking appellate review.
Hardy v. Johns-Mansville Sales Corp.
EXCEPTIONS
If the party against whom it is asserted could not have obtained review of the judgment in
Case 1
If a new determination of the issue is needed because of differences in the quality or
extensiveness of the procedures followed by the two courts or by factors relating to the
allocation of jurisdiction between them.
MUTUALITY OF ESTOPPEL
INTRODUCTION
Traditional Mutuality: Only people who can use preclusion in Case 2 are people who would
be BOUND by the judgment in Case 1 (parties, or those in privity with a party)
68

Based on a basic sense of fairness one should not be able to take advantage of a
judgment if she would not be burdened by that judgment.
NON-MUTUAL DEFENSIVE ISSUE PRECLUSION

Rejection of Mutuality for Defendants why should a party who was not bound by a
previous action be precluded from asserting it as collaterally estopped against a party who
was bound by it?
Can be used by a who was NOT a party to Case 1, against a who WAS a party to
Case 1.
Due process prevents a who WAS a party to Case 1 from using issue preclusion
against a claimant who was NOT a party to Case 1.
Promotes efficient joinder in Case 1 (because if fails to do so and loses Case 1,
in Case 2 can use the adverse finding against the claimant)
Blonder-Tongue
Case 1 sued D1 alleging patent infringement, resulting in a valid final judgment
on the merits for D1 based on express finding that the patent was invalid.
Case 2 sued D2 alleging patent infringement on the same patent.
SCOTUS rejected mutuality and permitted D2 to use issue preclusion
Relitigation imposes a burden on the judicial system
Raises the possibility that avoiding that burden might justify discarding the
mutuality rule.
System of justice affords a litigant one full and fair opportunity to litigate an
issue
Once that protection has been afforded, he litigant may be bound by the
finding on that issue in subsequent litigation, even by persons who were not
parties (or in privity).
NON-MUTUAL OFFENSIVE ISSUE PRECLUSION

Rejection of Mutuality for Claimants
Counsels potential claimants NOT to join in as a party to Case 1 (by staying out of
Case 1, a potential claimant risks nothing and may gain something if P1 loses, P2
is not bound but if P1 wins, P2 can use P1s victory to her own advantage in Case
2) seems likely to increase rather than decrease total amount of litigation.
Potential Unfairness to s
D who is sued in Case 1 for a small amount may have little incentive to
defend vigorously unfair to allow issue preclusion in Case 2 where claimant
seeks a large recovery.
If there are multiple judgments concerning the underlying events, unfair to
allow a claimant to get issue preclusion from one in which the was found
liable and ignore one in which has won.
Preclusion unfair if in Case 1 did not have a full and fair opportunity to
litigate in Case 1.
Parklane Hosiery Co. v. Shore
Case 1- SEC won an equitable judgment against a
corporation/managers/stockholders expressly finding that they issued a materially
false and misleading proxy statement.
Case 2 - Private s sued same parties for damages on the same basic claim
concerning the proxy statement, and sought to use issue preclusion on the finding
that the s had issued a materially false and misleading proxy statement.
SCOTUS adopted non-mutual offensive issue preclusion as federal law.
69

Ps here could not have joined Case 1 private s not permitted to join SEC.
s had every incentive to litigate vigorously in Case 1 due to the seriousness of the
allegations and the clear foreseeability that private s would sue if the SEC won.
No procedural opportunities available in Case 2 that were not available in Case 1.
Ignored potential unfairness in that the use of issue preclusion robbed the of their
right to a jury trial on the issue.
Nonmutual Offensive Issue Preclusion appropriate in only if the court in Case 2 is
convinced:
Party using issue preclusion could not easily have joined in the earlier
action, AND
Use of issue preclusion is not unfair to the .
COLLATERAL ATTACK ON CLASS ACTION JUDGMENTS
Stephenson v. Dow Chemical Co.

MA would argue that allowing this collateral attack undermines the finality of the
first judgment.
70
VII. SUMMARY JUDGMENT (JUDGMENT AS A MATTER OF

LAW): ADJUDICATION BEFORE TRIAL
BURDEN SHIFTING
56(c): Standard for Summary Judgment No genuine issue as to any material

fact.
Based on the pleadings, discovery and disclosure materials on file, and any
affidavits.
Evidence viewed in the light most favorable to the non-moving party.
For a to win s/j, must be able to establish every element of the claim and show
that if the case were to go to trial, no reasonable jury could find for the .
cannot simply purport to dispute the acts, but must present enough
evidence to contract the s evidence.
For a to win s/j, must show that s evidence is so utterly lacking that no
reasonably jury could find for the on that element of the claim.
Court looks beyond the pleadings and considers evidence.
Adickes v. S.H. Kress & Co.
Celotex Corp. v. Catrett (1986)
Catrett brought wrongful death suit against manufacturers of asbestos-containing
products, claiming her husband died of exposure.
argued that lacked evidence showing that the decedent had been
exposed to their manufactured asbestos and moved for s/j.
argued that had not proved that he had NOT been exposed to their
asbestos, and therefore there was a genuine issue of material fact.
To win summary judgment, must a present evidence to negate an element of s
claim, or can a win summary judgment by only pointing out the s lack of
evidence?
SCOTUS concluded that the need only point out s lack of evidence.
A party who does NOT have the burden of proof at trial may move for s/j
without producing evidence.
Moving party may simply point out that the record is devoid of evidence
supporting the other partys position, causing the burden to shift to the
non-moving party to provide evidence supporting its position.
-friendly standard can simply move for s/j on the basis of an absence of record
evidence supporting an element of s claim, and basically force to lay her cards
on the table.
Plain language of 56(c) mandates entry of summary judgment, after adequate
time for discovery and upon motion, against a party who fails to make a
showing sufficient to establish the existence of an essential element of her
case, and on which that party bears the burden of proof at trial.
71

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Civil Procedure, Spring 2011 - Arkin

III. DEFINING THE DISPUTE: PLEADINGS.......................................................22

PLAINTIFFS SIDE OF THE STORY: THE COMPLAINT................................................22

Civil Procedure, Spring 2011 - Arkin

JOINDER OF CLAIMS & PERMISSIVE JOINDER.........................................................32

V. WHAT LAW APPLIES IN FEDERAL COURT: OF THE ERIE DOCTRINE AND

Civil Procedure, Spring 2011 - Arkin

VI. THE EFFECT OF PRIOR ADJUDICATIONS: RES JUDICATA (CLAIM PRECLUSION)

VII. SUMMARY JUDGMENT (JUDGMENT AS A MATTER OF LAW): ADJUDICATION

Civil Procedure, Spring 2011 - Arkin

II. CHOOSING THE FORUM: ISSUES OF PERSONAL

In personam: exercised over the herself, because there is some appropriate

Summary of Bases of Jurisdiction under Pennoyer

Civil Procedure, Spring 2011 - Arkin

Consent: a can be subject to in personam jurisdiction if she appears in the

EXPANSION OF PENNOYER Use of Legal Fictions to Expand Personal Jurisdiction

INTERNATIONAL SHOE: MINIMUM CONTACTS

Principle: to subject a to a judgment in personam, if he be not present within

Civil Procedure, Spring 2011 - Arkin

has limited contact with the

has continuous & systematic

has casual contact with the

has continuous & systematic

McGee v. International Life: CA resident purchased a life insurance K from AZ company,

LONG ARM STATUTES: STATES & MINIMUM CONTACTS

Civil Procedure, Spring 2011 - Arkin

Laundry-list statute: contains a list of activities that subject a nonresident to in

SHAFFER v. HEITNER: s PROPERTY IN THE FORUM

WORLDWIDE VOLKSWAGEN CORP. v. WOODSON: REFINING MINIMUM

Civil Procedure, Spring 2011 - Arkin

Purposes of Minimum Contacts: (1) Protects s from litigation in an unduly

BURGER KING v. RUDZEWICZ

Facts: s in Michigan entered a franchise agreement with BK corporation, and BK sued in

Civil Procedure, Spring 2011 - Arkin

getting to FL was not an inconvenience of unconstitutional magnitude. Relative wealth of

Keeton v. Hustler: NY citizen sued a magazine publisher in NH (because there was a

Civil Procedure, Spring 2011 - Arkin

INSURANCE CORP. v. COMPANIE DES BAUXITES: CONSENT AS A BASIS

Principal Holding: was estopped from challenging jurisdiction because of

GENERAL JURISDICTION THEORY

Civil Procedure, Spring 2011 - Arkin

Zippo Mfg. v. Zippo.com: website alone is not sufficient to support jurisdiction

GLOBAL REACH OF PERSONAL JURISDICTION

Goodyear Luxembourg Tires v. Brown (2009)

Civil Procedure, Spring 2011 - Arkin

CHALLENGING PERSONAL JURISDICTION

Civil Procedure, Spring 2011 - Arkin

4(a)(1): sets forth the required contents of the summons

METHODS OF SERVICE OF PROCESS ON INDIVIDUALS

4(e)(2): provides 3 methods of service of process on an individual personal service,

Civil Procedure, Spring 2011 - Arkin

WAIVER OF FORMAL SERVICE

METHODS OF SERVICE OF PROCESS ON CORPORATIONS & ASSOCIATIONS

4(h)(1)(B): allows service of process on a business to be made upon an officer a

GEOGRAPHIC RESTRICTIONS ON SERVICE OF PROCESS IN THE U.S.

Civil Procedure, Spring 2011 - Arkin

VENUE - 1391, 1404, 1406

LOCAL & TRANSITORY ACTIONS

1391 VENUE FOR TRANSITORY ACTIONS IN FEDERAL COURT

Civil Procedure, Spring 2011 - Arkin

Civil Procedure, Spring 2011 - Arkin

FORUM NON CONVENIENS

Generally refers to a doctrine of dismissal.

PIPER AIRCRAFT V. REYNO