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2
has to follow the discovery; no genuine dispute as to any material fact
Rule 56(a)
o option to file Motion in Limine
request advance ruling on variety of issues, (ie) evidence, limit scope of
witness testimony
Opening Statements
Plaintiffs Case
Defendants Case
o *Motion for Directed Verdict
challenging sufficiency of the evidence presented in support of the non-
moving partys claim
judge will grant motion only if it determines no reasonable juror could
interpret the evidence in favor of non-moving party
Closing Arguments
Verdict
o Motion for Judgment: following the juries verdict/ gives the judge one final time
to change her mind about anything is case (evidence sufficient to support jurys
decision); Similar to Motion for Directed Verdict
o Motion for New Trial: final opportunity for trial judge to correct any serious legal
errors that may have occurred during the trial.
o Final Judgment
Appeal: Address the correctness of trial court rulings that are could affect outcome
o Court of Appeals; State Supreme Court
3
Class Framework: Where are We Going
Step 1: Select a Court with Jurisdiction
o Subject Matter Jurisdiction & Removal;
o Personal Jurisdiction
Step 2: Select the Proper Court in a Jurisdiction
o Venue
Step 3: Determine the Applicable Law
o Erie Doctrine
Step 4: Initiate the LawsuitPleadings
o Complaint;
o Answer
Step 5: Discovery
Step 6: Disposition without Trial
Step 7: Trial
Step 8: Post-Trial Motions
Step 9: Judgments & Appeals
4
Ch. 3: Subject Matter Jurisdiction
Federal courts are courts of limited jurisdiction
o Ie. Some cases have to be heard in federal court
most are concurrent with the states; does not say that cases cannot be heard in other
courts
o If claim arises under federal statutes, it CAN be filed in federal court BUT it does
not have to be (ie. not exclusive) BUT Some claims are (ie. admiralty matters)
Constitutional Framework
U.S. Const. Art III, 2, Cl. 1
o Authorizes federal jurisdiction in certain types of cases
o only creates one Supreme Court BUT gives congress power to create inferior
courts (lower federal courts)
o U.S. Constitution authorizes federal courts to hear certain claims and Congress
confers, via statutes (e.g. 28 U.S.C.____), power to hear such claims
Limits on Power: Art III, . 2
o Provides list of set case subjects that must AND are only type to be heard in
federal court
o If your case is not on the list, it cannot be in federal court
Congress & Federal Statutes
o Congress enacts jurisdiction-conferring legislation, via federal statutes, to give
lower courts the authority to hear cases
SMJ Uniqueness
Courts will raise this issue even when none of the parties or earlier courts have raised it
Unlike Personal Jurisdiction, which has to be raised immediately, Subject Matter
Jurisdiction can be raised at any time by any party
Judgment becomes void and plaintiff must refile in court with Subject Matter Jurisdiction
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(A) 28 U.S.C. 1332: Diversity Jurisdiction
Two Basic Requirements:
1. Diversity of Citizenship; and
2. Amount in Controversy
28 U.S.C. 1332
(a)The district courts shall have original jurisdiction of all civil actions where the matter in
controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between:
(1) citizens of different States;
(2) citizens of a State and citizens or subjects of a foreign state, except that the district
courts shall not have original jurisdiction under this subsection of an action between citizens of a
State and citizens or subjects of a foreign state who are lawfully admitted for permanent
residence in the United States and are domiciled in the same State;
Key Topics
Definition of state citizenship;
Definition of diversity (between what parties);
Amount in controversy (money);
Citizenship determined at time the action is filed;
Legal Representation
o For minors; mentally incompetent; decedent-lawyer is citizen of state where
person represented is from
Requirements
must be a natural person;
citizen of the United States;
domiciled within the State
Domicile
Where you permanently live and plan to stay
o *note: a person may have multiple residences but can only have one domicile
Changing Domicile: Must be physically present in the new place & intend to make this
home permanently
6
Mas v. Perry (5th Cir.; 1974) pp. 200
See attached Brief.
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(E) Citizenship: 1332(a)(2)-(3) Aliens
(a)The district courts shall have original jurisdiction of all civil actions between:
(2) citizens of a State and citizens or subjects of a foreign state, except that the district
courts shall not have original jurisdiction under this subsection of an action between
citizens of a State and citizens or subjects of a foreign state who are lawfully admitted for
permanent residence in the United States and are domiciled in the same State;
(3) citizens of different States and in which citizens or subjects of a foreign state are
additional parties;
Alienage Citizenship
Citizen of a Foreign State
o Person must be a true citizen of foreign state and domiciled in that foreign state
Aliens
o lawfully admitted aliens deemed to be a citizen of state in which they are
domiciled
Permanent Resident Aliens
o New York (Pl.) vs. French Citizen domiciled in New York (D): no diversity
Examples
Alabama (Pl) vs. Mexico (D): Yes
Alabama & Mexico (Pls) v. France & New York (Ds): Yes
France (Pl.) vs. Germany (D): No
France & Alabama (Pls) vs. Germany (D): No
8
(f) Special Rules on Diversity Jurisdiction
Complete Diversity
Cannot have citizens of the same state on each side of a dispute
o Ie. No plaintiff can be from the same state as any defendant for diversity
jurisdiction
Example: New York (Pl.) vs. Virginia (D1) + New York (D2): no diversity
Exceptions to Diversity
Even with complete diversity, federal court will not hear domestic relations claims or
claims involving probating wills
Examples: divorces, child support claims, child custody decrees, probate wills
Rules
Only applies in diversity jurisdiction
o If claim is under federal law, it does not need to comply with amount in
controversy because there is federal question jurisdiction
Diversity Exceptions: Even if claim goes over $75k, invalid if claim is a domestic
dispute or probate of a will
Court is lenient and generally will accept the complaint on its face
o Ie. "my claim is worth $75k"
Good rationale argument must be madebut it is still ok if the claim does not get $75k in
the trial
o Only way it will not work is when it is clear to a legal certainty that this amount
will not be received
Punitive Damages: only second guessed when they cannot be received in particular state
for the action
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Aggregating Claims
Issue: may a plaintiff or plaintiffs combine/aggregate their claims against a single or
multiple defendants to satisfy the amount in controversy requirement? Maybe
1. Single Plaintiff may aggregate claims (related or unrelated) against a single defendant
Plaintiff (Claim 1: $31k & Claim 2: $45k) vs. Defendant: Yes
2. Single Plaintiff may NOT aggregate separate claims against multiple Defendantsunless
Defendants are jointly liable
Plaintiff (Claim 1: $31k) vs. Defendant 1 + Plaintiff (Claim 2: $45k) vs. Defendant 2: No
Plaintiff (Joint Liability Claim: $76k) vs. Defendant 1 and Defendant 2: Yes
3. Multiple Plaintiffs may aggregate claims against single defendant so long as the claim is
based on a common undivided interest
Common Undivided Interest: Plaintiff 1 & Plaintiff 2 own building destroyed by
Defendant; Plaintiffs may assert 1 claim against Defendant exceeding $75k
Unrelated Claims: Plaintiff 1 & Plaintiff 2 each sued Defendant for breach of contract
seeking $50k eachcannot aggregate because claims are unrelated as each plaintiff had
an independent contract, rather than a shared undivided interest
4. Multiple Plaintiffs may NOT aggregate separate and distinct claims against a single
Defendant
Car Wreck Example: Plaintiff 1 (Claim 1: $40k) & Plaintiff 2 (Claim 2: $40k) vs.
Defendant: No
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(B) 28 U.S.C. 1331: Federal Question Jurisdiction
Art. III, 2: Extends Power
o Extends judicial power to all Cases, in Law and Equity, arising under this
Constitution, the Laws of the United States, and Treaties.
1331: Grants Authority
o The district courts shall have original jurisdiction of all civil actions arising
under the Constitution, laws, or treaties of the United States.
Louisville & Nashville R.R. Co. v. Mottley (S. Ct. 1908) pp. 224
See attached Brief.
Hypo #1
Worker sues employer; claims violation of FLSA (a federal statute that established
minimum wage); employer does not contest the statute BUT contends the number of
hours the employee worked are debatable and he is not entitled to amount sought
Federal Question Jurisdiction? YES
o Plaintiff's claim is under a federal statute and defendants claim is a factual
dispute; and
o Relief for plaintiff is on federal statute
Hypo# 2
Plaintiff sues newspaper claiming defamation; newspaper's defense rests on 1st
amendment (not liable unless they acted negligently)
Federal Question Jurisdiction? NO
o Plaintiff's COA does not arise federal statute; only the defense does; Same as in
Louisville RR. V. Mottley
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3. The "Essential Federal Element" Requirement
Context: plaintiff asserts a state-law claim that requires determination of federal legal
issues the claims ultimate resolution
Example
o P sues D for breach of fiduciary duty (state-law claim) on basis that Ds conduct
violated federal securities law; If D is found to have violated the federal securities
law, P prevailsbut if not, P loses
o As such, Ps claim hinges on a determination of a matter of federaldo these
claims arise under federal law as to satisfy the requirements for federal question
jurisdiction?
Rules
Plaintiff's cause of action must be created by federal law
Grable & Sons Metal Prods., Inc. v. Darue Eng. & Mfgr. (S. Ct. 2005) pp. 232
See attached Brief.
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(C) Removal Jurisdiction
Basic Rules
Must have Subject Matter Jurisdiction
o **based ONLY on plaintiffs claim[s]NOT defendants defenses/counterclaims
Only defendant can remove, provided that all defendants agree
Can only remove from State Court to Federal Court
Subject Matter Jurisdiction is determined for removal purposes at the time of filing
notice of removal
Notice of Removal is not a motion; Once it has been filed in federal district, it becomes a
federal matter and state court has no power
Rationale: Few actions have to be filed in federal court and most can also be heard in
state court (i.e. "concurrent")
Rule
If claim can get into court on federal question jurisdiction, it can always be removed to
Federal Court
If basis of claim is not federal question but is based on diversity defendant(s) can remove
only if he or any defendant(s) are not from the forum state
13
Hays v. Bryan Cave L.L.P. (7th Cir. 2006) pp. 272
See attached Brief.
Rules
Who can remove: only Defendant
1446(a) How to Remove: D files notice of removal
1446(b)Timing: D has 30 days from receipt of complaint to file a notice of
removalOR 30 days after receipt of amended complaint, which then makes the claim
removable
1446(b) Requirements
(1) Timing: Defendant has 30 days after he receives complaint to file notice of removal
*BUT even if defendant takes 60 days to file notice, it is up to the plaintiff to state
improper removal for going over allotted time limit under the statute
(3) Subsequent Changes: Plaintiff may send initial complaint with only $10k damages
BUT plaintiff can amend complaint seeking $85k; now defendant still has 30 days from
receipt of amendment complaint to file notice of removal
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(b) Post-Removal: 1447 Remand Procedures
1447(c)
A motion to remand the case on the basis of any defect other than lack of subject matter
jurisdiction must be made within 30 days after the filing of the notice of removal under
section 1446(a). If at any time before final judgment it appears that the district court lacks
subject matter jurisdiction, the case shall be remanded.
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Chapter 4: Venue
Venue limits choice of courts
o Must have personal jurisdiction (courts power)
o Must be in correct venue
Hypo
Pl. lives in Atl. & Def. lives in Birmingham; Pl. has claim against Def; Def. has
substantial contact with Ga and this gave rise to claim
Jurisdiction and Courts?
o All Alabama state and federal courts
o All Georgia state and federal courts
Which Court? Have to look at state venue rules
Rules
(1) venue is proper in any district where any defendant residesBUT only if all
defendants are residents of the state in which the district is located
(2) venue is also proper in the judicial district in which a substantial part of the events or
omissions giving rise to the claim occurredor substantial part of the property at issue
is located
(3) Default Rule: if neither (1) or (2) work, venue is proper in any district in where the
court would have personal jurisdiction over the action
o ie. Can be used if claim arose outside of U.S. soil or defendant is U.S. citizen
living abroad
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Hypos
1. P sues D.1 and D.2 for b/k/ D.1 lives in N.D.GA and D.2 lives in S.D.Ga./ what venue is
proper?
Could be either one/ both defendants live in the same state/ could also be in district where
the claim arises from but need more facts
2. P sues D.1 and D.2 for b/k/ D.1 lives in N.D.GA and D.2 lives in N.D.Ala./ what venue is
proper?
Have to be district in which the claim arises from/ need more facts
3. P sues D.1 and D.2 for injuries in car wreck/ D.1 lives in N.D.Ga. And D.2 lives in
N.D.Ala./ wreck happened in N.D.Ala./ what venues is proper?
N.D.Ala because the claim arises in this district. Cannot use residency
4. P sues D for b/k/ D lives in S.D.N.Y./ contract was for mfr and delivery of a machine/
machine was designed in N.M., Assempbled in N.D.ILL, parts from Ohio, Cal, and Penn,/
supposed to be delivered in W.D.N.Y./ what venues could work?
S.D.N.Y. and would have to know more about what the claim is to determine in what step
did the claim arise from, therefore giving another district that would work
Surface Supplied Inc. v. Kirby Morgan Dive Systems, Inc. (N.D. Cal. 2013) pp. 289
See attached Brief.
(b) Residency
1391(c): Residency
(1) A natural person, including an alien admitted for permanent residence in U.S., shall be
deemed to reside in the judicial district in which that person is domiciled
(2) an entity with the capacity to sue or be sued, whether or not incorporated, shall be deemed to
reside, if a defendant, in any judicial district in which such defendant is subject to the court's
personal jurisdiction in respect to the civil action, and if plaintiff, only in the judicial district in
which it maintains its principle place of business
(3) Defendant not resident in the United States may be sued in any judicial district, and the
joinder of such a defendant shall be disregarded in determining where the action may be brought
with respect to other defendants
Rules
(1) Individuals: for venue purposes, an individuals residency is his domicile
o Aliens: If alien is lawfully admitted citizen, alien is deemed to reside in judicial
district they are domiciled in
(2) Business Entities/Corporations
o Defendant: any district in which the court has personal jurisdiction
o Plaintiff: only in judicial district where principle place of business is located
(3) Alien Defendants: for venue purposes an Alien can be sued in any judicial
district.(but court would still need Personal Jurisdiction & Subject Matter Jurisdiction)
o Applies to: Aliens, U.S. Citizens domiciled abroad, and Foreign Corporations
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1391(d): Residency of Corporations in States with Multiple Districts
For purposes of venue under this chapter, in a State which has more than one judicial
district and in which a defendant that is a corporation is subject to personal jurisdiction
at the time an action is commenced, such corporation shall be deemed to reside in any
district in that State within which its contacts would be sufficient to subject it to personal
jurisdiction if that district were a separate State, and, if there is no such district, the
corporation shall be deemed to reside in the district within which it has the most
significant contacts.
Rules
Corporations are residents of any district where they are subject to the courts personal
jurisdiction
o If state has more than one district, a corporation is a resident of any district in
which it could be subject to personal jurisdiction were that district a state
Need to look at corporations contacts with particular jurisdiction
o Ie. Walmart is likely resides in every district in the U.S.
Challenging Venue
FRCP 12(b)(3): Motion to Dismiss for Improper Venue
o Brought by defendant
o Exists as a waivable defense meaning that unless the motion is made in
defendants initial response to plaintiffs complaint, venue is waived
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(B) Change of Venue (Transfer)
28 U.S.C. 1404
(a) For the convenience of parties and witnesses, in the interest of justice, a district court may
transfer any civil action to any other district or division where it might have been brought or to
any district or division to which all parties have consented.
(b) Upon motion, consent or stipulation of all parties, any action, suit or proceeding of a civil
nature or any motion or hearing thereof, may be transferred, in the discretion of the court, from
the division in which pending to any other division in the same district. Transfer of proceedings
in rem brought by or on behalf of the United States may be transferred under this section without
the consent of the United States where all other parties request transfer.
(c) A district court may order any civil action to be tried at any place within the division in which
it is pending.
(d) Transfers from a district court of the United States to the District Court of Guam, the District
Court for the Northern Mariana Islands, or the District Court of the Virgin Islands shall not be
permitted under this section. As otherwise used in this section, the term district court includes
the District Court of Guam, the District Court for the Northern Mariana Islands, and the District
Court of the Virgin Islands, and the term district includes the territorial jurisdiction of each
such court.
Overview of 1404(a)
Rule: If venue is proper and defendant makes initial motion, court uses MAY transfer the
case based on their own discretion
Venue must be proper and court can only transfer to another district where it could have
been in the first place;
Transferring district must still have PJ
Consider the convenience of parties
o Ie. Where the evidence is; witnesses; travel
Motion to transfer must be made early
Overview of 1406(a)
Rule: If the venue is improper and defendant makes initial motion, the court can either
dismiss the case or transfer to where it could have been (a proper venue)
19
See attached Brief.
Atlantic Marine Constr. Co. v. U.S. Dist. Court, W.D. Tex. (S. Ct. 2013) pp. 314
See attached Brief.
Smith v. Colonial Penn Ins. Co. (S.D. Tex. 1996) pp. 325
See attached Brief.
20
See attached Brief.
21
Chapter 2: Personal Jurisdiction
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(2) Notice
A. Statutory Requirement (not always sufficient; have to balance with Due Process)
Federal FRCP Rule 4
o Follow state laws of forum state;
o Follow state laws where service is effected;
o Personal service on defendant;
o Leave complaint at Ds dwelling or abode with applicable person who
resides there;
o Personal service on an authorized agent;
o Constructive service (certified mail) for waiver only
State Rules
B. Due Process/Constitutional Requirement
Sufficient information
Allow enough time to appear and defend
Method of service
o Use most reasonable method available UNLESS this method is a burden
(too expensive) stick with practical method available
Standard
o reasonably calculated under all circumstances to reach defendant and
allow time to defend
Response
o D has 30 days to waive service (if so, has 60 days to answer complaint)
o If not, D must be served with process and has 21 days to answer the
complaint
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Introduction & Overview
A court, state and federal, must have jurisdiction to hear the claim
Two aspects of a courts jurisdiction:
o Personal Jurisdiction: jurisdiction (power) over the litigations; and
o Subject Matter Jurisdiction: jurisdiction (power) over the subject matter of the
claim
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Modern Approach
1. Statutory Authority
FRCP 4(k)(1)
*Serving a summons of filing a waiver of service establishes personal jurisdiction over a
defendant:
(A) who is subject to the jurisdiction of a court of general jurisdiction in the state where
the district court is located;
o Ie. Any judicial district where a state court has personal jurisdiction
(B) who is a party joined under FRCP 14 or 19 and is served within a judicial district of
the United States and not more than 100 miles from where the summons was issued; or
o Ie. 100-mile Bulge Rule
(C) when authorized by federal statute
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2. Contacts & Fairness
Two Types of Personal Jurisdiction
1) General
continuous and systematic contacts with forum state BUT the claim does not arise from
the arise from the contacts
can be sued for anything in forum state
Contacts must be such that the defendant feels at home in forum state
2) Specific
casual and isolated contacts BUT the claim does arise from the contacts
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Calder Effects Test
Defendant can have purposeful contacts if such contacts have an intended effect in the
forum state and are purposefully directed therein.
Stream of Commerce
Must put product into stream of commerce directed at specific state, or at least have some
additional contacts with the forum state such as advertising/marketing its residents
o Not purposeful contacts if defendant sells product with knowledge/awareness that
its product may end up in the forum state
Asahi Metal Industry Co. v. Superior Court (S. Ct. 1987) pp. 89
See attached Brief.
Perkins v. Benguet Consolidated Mining Co. (S. Ct. 1952) pp. 123
See attached Brief.
Goodyear Dunlop Tires Operations, S.A. v. Brown (S. Ct. 2011) pp. 125
See attached Brief.
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(c) Power of Property: In Rem
True In Rem: power over property so long as such property gives rise to the plaintiffs
cause of action
Quasi In Rem: power over property within the forum state that does not give rise the
plaintiffs cause of action but may be proper so long as defendant has minimum
contacts with the forum state
o Rule: Requires contacts + claim arises from contacts
o Cannot merely exercise personal jurisdiction over a defendant based solely on
property within the forum state
Shaffer v. Heitner (S. Ct. 1977) pp. 134
See attached Brief.
1. Defendant inherits property in Idaho, but has no other contacts in the state. Defendant is
involved in a car accident in Alabama and the Plaintiff is from Idaho and sues in Idaho district
court. An Idaho Statute provides that Defendants property within the state can be seized and
notice through publication and mailed to Defendant. Does Idaho have personal jurisdiction over
the non-resident Defendant?
Under Pennoyer: YesTrue in Rem
o Sufficient notice was provided, property was seized before the lawsuit, and
property was located in forum state.
o Could not exercise In Personam jurisdiction because Defendant has never been to
Idaho and has virtually no contacts and the claim doesnt arise from contacts
Under International Shoe & Shaffer: Nofails under True In Rem and Quasi In Rem
o Defendants only contact with Idaho is the inherited property. Minimum Contacts
are lacking
Change of Facts: What if Defendants Aunt left money in bank (i.e. property in forum
state) instead of the land? No insufficient contacts
2. Defendant inherits a large property, including a home, located in Idaho. The property is large
and Plaintiff child enters the property and falls into a large hole, resulting in personal injury.
Plaintiff then files suit against Defendant for negligence in Idaho district court. An Idaho statute
provides that the property can be seized and notice is provided via publication and certified mail.
Does Idaho have personal jurisdiction over the Defendant?
Under Pennoyer: Yes
Under Intl. Shoe & Shaffer: YesTrue in Rem Jurisdiction
o Contacts are sufficient; Claim arises from contacts
**Difference between 1. and 2. is sufficiency of contacts and claim arising from contacts
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(d) Transient Jurisdiction
Arises when defendant is served with process while physically present in the forum state,
albeit temporarily, and with little to no other contacts with the forum state
Rule: court may exercise in personam personal jurisdiction over defendant who is
physically present in and served within forum state
Carnival Cruise Lines, Inc. v. Shute (S. Ct. 1991) pp. 160
See attached Brief.
29
(C) Notice Component
Notice has a Statutory and a Constitutional aspect
Rule/Statutory Requirements of court giving instructions on how to serve process
o Every state court has prescribed method of serving process
o Similar to long arm statute on power
Mullane v. Central Hanover Bank & Trust (S. Ct. 1950) pp. 173
See attached Brief.
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2. Statutory Prong: FRCP 4
Federal courts may use notice requirements of state that the court sits in
Federal courts may use notice requirements of state that service is being made in
o Ie. Alabama court serving in Georgia can use Georgia statutory laws
Serve directly on person
Leave at home with applicable person
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6. Give defendant reasonable time of at least 30 days/ 60 if not in the
U.S. to return the waiver
2. Failure to Waive
a. Defendant must pay expenses incurred in making service
b. AND the reasonable expenses, including attorney's fees, or any motion
required to collect those service expenses
3. Time to Answer After a Waiver
a. Defendant who, before being served with process, timely returns a waiver
need not serve an answer to the complaint until 60 days after the request was
sent
4. Results of Filing a Waiver
a. When plaintiff files a waiver, proof of service is not required
5. Jurisdiction and Venue Not Waived
a. Waiving service of a summons does not waive any objection to personal
jurisdiction or venue
e. Serving an Individual Within a Judicial District of the United States
1. Following state law for serving a summons in an action brought in courts of general
jurisdiction in the state where the district court is located or where service is made
2. OR doing any of the following
a. Delivering a copy of summons and complaint to the individual personally;
b. Leaving a copy of each at individual's dwelling or usual place of abode with
someone of suitable age and discretion who resides there;
c. Delivering a copy of each to an agent authorized by appointment or by law
to receive service of process
f. Serving an Individual in a Foreign Country
g. Serving a Minor or Incompetent Person
h. Serving a Corporation, Partnership, of Association
1. In a judicial district of the U.S.
a. In manner prescribed by Rule 4(e)(1) for serving individual
b. Delivering copy of summons and complaint to an officer, managing general
agent, or any other agent authorized by appointment or by law to receive
service of process OR if agent is authorized by statute (can be by mail if
statute requires)
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Chapter 5: The Erie Doctrine
Deals with diversity jurisdiction
Question: Which law, State or Federal, must apply to claims in Federal Court sitting with
diversity jurisdiction?
Constitution
Allocates/ Disperses Governmental Power
Embodies notion of federalism: enumerated powers
o Federal power exclusive
o Other powers given to state
Separation of Powers: Legislature; Judicial; Executive
o Checks and balances system to keep equal
General Limitations: Bill of Rights
Choice of Law
State Courts: Whatever state the court is in, that states law applies
Every state has choice of law doctrine
o Based on common law; Each side attorney will argue for what law applies
Federal Courts: If the case is not a federal question, court must determine what law will
be applied
o Either that of the state (common law); or
o federal common law
33
Issue: whether the Federal Court of New York was bound to apply the laws of New York,
or whether the court was free to develop its own view on the law?
Held: federal courts sitting in diversity jurisdiction are not bound to apply the substantive
law of the states, but rather are free to exercise an independent judgment as to what the
common law of the state is
Court interpreted 1652 as meaning only state statutes, not state common law.
o The decisions of local tribunals are not laws but merely evidence of what the laws
are
o Thus federal courts are entitled to create their own law in the area
Promote Uniformity
o States are all individualistic and do their own thing BUT society needs uniformity
in the law for commercial matters; Works to aid commerce
Philosophical Concept of Law
o In the 19th century, Common Law was reasoned to not be made by courts
o Instead courts deduced law by figuring out the law using their own judgment
o (used gift of reason to deduce unchanging, transcendental law; the law was
already out there unchanging and omnipresent)
o SO if state courts made common law rule and federal courts did not like it, they
would develop their own common law
Erie Holding
federal courts sitting in diversity must apply states substantive law (ie. Tort law),
whether that law is in the form of a state statute or state judicial decision
1. New Scholarship
Lost documents were found; Maybe writers of 1652 actually meant that state common
law applies
2. Experience with Swift
Uniformity did not develop
34
o Federal and state courts split even further
Confusing distinction between general and local law
o General law was law federal court could use and local law state common law;
Hard to tell the difference between the two
Unfairness of Forum Shopping: Discriminated against in state citizens
3. Legal Realism
Law is now seen as what an authority says it is; Even if it goes against human injustice;
Laws are viewed as unjust because we fundamentally disagree with them NOT because
some transcendental, unchanging law is inconsistent with it
Laws are now seen as a matter of policy; Courts & legislature decide if laws are just; We
have procedural system set up; States can have bad law if they want to and federal courts
cannon change it
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