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Author: Mr. Neal A. Davis (ndavis@mail.utexas.edu)
School: University of Texas School of Law
Course: Civil Procedure
Year: Fall 1995 and Spring 1996
Professor: Edward Sherman
Book: Civil Procedure: A Modern Approach, Second Edition (1995), by Marcus,
Reddish, and Sherman
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Civil Procedure Outline
1995-96
Prof. Edward
Sherman
Recommended study aids:
UT Prof. Charles Wright’s hornbook on the federal rules is outstanding,
and is often relied on and cited by federal courts in their opinions.
I highly recommend your purchasing this book. The Gilbert’s
on Civil Procedure is very good, particularly since it is written
by Marcus (a co-author of Sherman’s casebook). Since Wright’s
hornbook covers only the federal rules, it is worth consulting Arthur
Miller’s hornbook on civil procedure for non-rule issues (i.e., personal
jurisdiction). There is one simple rule to follow in Sherman’s
course--make sure you read the notes following the cases. Often
times, the answers on his exams can be found in these notes.
Choosing
a System of Procedure
I. Substantive Law v. Procedural
Law
A. The line between substantive and procedural law can sometimes
be
difficult to draw, but there are some basic distinctions:
1. Substantive law defines legal rights
and duties in everyday conduct.
2. Procedural law sets out the rules
for enforcing substantive rights in the court.
a. Without procedural law, there would be no standardized method of litigation, all cases would
be decided ad hoc, and there
would be no procedural consistency in similar cases.
b. The hardest and most important job of a
procedural system is to strike a wise balance
throughout the various points of conflict.
c. The courts often seek to accomplish
substantial justice by adhering to established
substantive law while manipulating procedural
rules in favor of the "right" party. This causes
the worst procedural rulings, and is
unjust.
II. Adversary (or Anglo-American)
System v. Continental (or European) Law
A. Our procedural system is adversarial. In civil disputes, it is up to the
parties, not the court, to initiate and prosecute litigation, investigate
the
pertinent facts, and present proof and legal argument.
1. The Court
a. The court's function is generally limited to
adjudicating the issues raised by the parties and
providing appropriate procedural sanctions
to the parties.
b. The court is an essentially passive arbiter, or what
Frankel calls a "passive umpire,"
while counsel handles the presentation and prosecution of a case.
(1) Depending on the case, a judge can play a more
active or passive role. In "public question"
litigation such as school desegregation and
prison administration, or in dispute resolution,
the judge plays a more active role.
(2) A fair generalization is that federal judges
are traditionally more active than state judges.
2. Counsel
a. Handles presentation and prosecution
of cases.
b. Prosecution and defense should have a balanced
opportunity to investigate and present proof and legal
argument.
3. Advantages and Disadvantages of
Adversarial System
a. The adversarial system operates under two assumptions, which
are its supposed advantages:
(1) The truth is likely to emerge more from bilateral
investigation and presentation, motivated by the
strong pull of self-interest, than from judicial
investigation motivated only by official duty
(as is the case in Europe)
(2) The moral force and acceptability of a decision
will be greatest when it is made by someone--in
our system a judge--who is not (or supposed to
not be) biased toward a certain side
or position.
b. Another advantage of our adversarial system is its
system of "checks and balances" between attorneys
and judges. Counsel can try to pursuade a judge to
rule a certain way, and can appeal judge's decisions
during or after trial.
c. The disadvantages of our system:
(1) Poorly prepared judges or counsel, which could
easily lead to unjust or unfair results.
(2) Overzealous judges or counsel who violate the
law or do unethical things in order
to forward their own cause.
B. The Continental system in Europe involves a much more active
judge with counsel playing a more passive role than their Anglo-
American counterparts. The chief function of the court in the
Continental system is to find out the truth and not merely decide
which
party has adduced better evidence.
1. Lawyers
a. The lawyers, through an examination of the facts, determine what the specific question will be in litigation. As result, counsel draws the perimeters of
the dispute and within these the court
must determine the issues raised by the parties.
b. Counsel asks the witnesses supplementary
questions, after the judge has finished interrogating witnesses.
2. Judges
a. The judge advances the course of the proceedings and
conducts the hearings at the trial.
b. It is the judge's duty to find and apply the law to the
issues in the case at hand.
c. A judge can do many things not normally allowed in
our system:
(1) He interrogates the witnesses and
experts
(2) He can appoint his own experts, even if counsel
has not requested him to do so.
(3) He is heavily involved in "document
production," and has the ability to request documents from litigants
or witnesses.
3. Advantages and Disdvantages of the
Continental System
a. Advantages
(1) The search for truth and justice is given
priority over what party merely produces the
best evidence.
(2) A poorly prepared attorney does not hamper
the pursuit of justice as much as it would in
the Anglo-American system, where counsel
plays a much more active role.
b. Disadvantages
(1) The judge, because he is officially
appointed, might not take the kind of interest in a case that counsel
does in Anglo-American system.
(2) Often times, the lawyers do not
question witnesses at length because they are afraid that extensive
questioning might appear to be critical of the court.
III. The Judge's Role in
our Anglo-American System
A.
Legal Theory: the Role of the Judge
1. Fuller, "The Problems of Jurisprudence"
(13)
a. The moral force of a judgment or
decision will be maximum when these six elements are all present:
(1) J doesn't act on his own initiative,
but on the application of one or both disputants.
(2) J has no direct or indirect interest
in outcome of case.
(3) J confines decision to controversy
before him and doesn't attempt to regulate parties' relations beyond
that controversy.
(4) Case presented to J involves an
existing, as opposed to future, disagreement.
(5) J decides cases solely on the basis
of evidence and arguments presented to him by parties.
(6) Each disputant is given ample opportunity
to present his case.
2. Zeidler, "Evaluation of the
Adversary System" (14) -- SEE COMMENTS ABOVE (IIB) ABOUT CONTINENTAL
SYSTEM
3. Frankel, "The Search for Truth:
An Umpireal View" (15)
a. The judge is a "passive
umpire" who views cases "from a peak
of Olympian ignorance." This can have negative consequences:
(1) J is often unprepared and ignorant
about the case at hand. As a result, his interruptions are sporadic
and out of character, and can sometimes mislead the jurors.
(2) "The judge is a blind and blundering intruder; acting in spasms as sudden flashes of seeming light may lead or mislead him at odd times."
B.
Cases: Judicial Power
1. What a judge can and cannot do:
a. Rule 16 in Rules of Civil Procedure
(RCP) outlines how much power a judge has in establishing pretrial conferences,
scheduling and management.
(1) Although the law favors the
voluntary settlement of civil suits, it does not sanction efforts
by trial judges to effect settlements through coercion. In short,
pressure tactics to coerce settlement simply are not permissible.
Rule 16(f) of FRCP "was not designed as a means of clubbing
the parties--or one of them--into an involuntary compromise."
Kothe v. Smith.
(2) Rule 16(f) says that if a party
or his lawyer fails to participate in the pretrial conference, fails
to do so in good faith, or fails to comply with scheduling or pretrial
order, the judge may apply whatever sanctions are “just.”
b. A judge must use the "greatest
restraint" in calling witnesses. Band's Refuse v. Borough of
Fair Lawn
c. A trial judge is supposed to be
impartial, but this does not mean that he cannot occasionally ask questions
of a witness in an effort to clarify testimony for the jury. Band's
d. Unless the circumstances require
it, a judge should avoid meeting with a party
ex-parte (appearance of impartiality). If he does this, he
must notify the opposite party that he is meeting with a party ex-parte.
Band's
e. A judge cannot add a new issue in
a trial without giving counsel appropriate amount of time -- a "full
and fair opportunity" -- to respond to issue. Band's
f. If an amicus curiae is appointed
or allowed, he should not be given a great deal of power, or at least
more power than we normally see in our adversary system. Band's
g. There should be a balancing of judicial power against the interests of a litigant. Judicial self-restraint and impartiality are crucial to the legitimacy of the judicial system. Band's
h. "Courts may not only be impartial;
they must give the appearance of impartiality." In Band's,
this especially refers to meeting with an attorney ex-parte.
NOTE: The extent of
judicial power has been re-considered over the last few decades as the
number of large-scale lawsuits and class-action suits has dramatically
increased. If a manufacturer of breast-implants is sued by 10,000 plaintiffs,
should the judge try his best to force a settlement so that the courts
are not flooded with these lawsuits? Just how far should a judge
go in dispute resolution? See the Agent Orange case on p. 23-24.
Should a judge exercise more power if the interests of the
“public good” are threatened? Remember that the judge in
Band's tried to justify his active judicial role by arguing that
he was trying to "protect the public interest." Also, see
Reserve Mining Co. on p. 11.
IV. Procedural Complications
of our Federal System (24-25)
A.
Subject Matter Jurisdiction
1. There are basically two situations
in which federal courts have such jurisdiction:
a. If there is a federal question,
such as a violation of civil rights or federal antitrust laws.
b. If there is diversity of citizenship,
in which two conditions must be met:
(1) No plaintiff can be a citizen
of the same state as any defendant (this does not prevent a pair
of plaintiffs, or defendants, from being co-citizens). There is
no diversity if there is a suit between two aliens (or non-US citizens),
but there is diversity if there's a suit between a citizen of one state
and an alien or foreign national.
Example: P1 and P2 are citizens
of Texas. P3 is a citizen of Alaska. D1 and D2 are citizens of California.
D3 is a citizen of Alaska. There is no diversity here because P3 and
D3 are citizens of the same state. There must be complete diversity.
(2) P contends in good faith that the
matter in controversy exceeds $50,000.
NOTE: There must be complete diversity when applying
FRCP, unless specifically stated otherwise
in rule.
2. If they so desire, the parties can
have their case heard in a state court of "general jurisdiction"
instead of a federal court.
3. If a case goes to federal court
because of diversity of citizenship and the case does not involve federal
claims, then a federal judge should apply substantive state law to determine
claim and should apply federal procedural law.
NOTE: The rationale
for the existence of diversity jurisdiction has
traditionally been that it offers a federal forum for out-of-state
litigant who would be exposed to local prejudice if suit was held in
a state court.
Prejudgment
Seizure and the Due Process Clause
I. Important Definitions
A.
The Due Process Clause of the Fourteenth Amendment states: "[N]or
shall any State deprive any person of life, liberty, or property, without
due process of law..." In order for there to be a violation of
the Due Process Clause, the State must be
involved on some level (i.e., a writ of replevin is issued by the
court or enforced by the sheriff).
B.
A prejudgment seizure of the defendant's property is a means
of insuring that property will be available for execution in case the
plaintiff prevails. All states have developed statutory procedures for
some prejudgment seizure of assets under a variety of names -- replevin,
garnishment, attachment and sequestration.
II. Procedural Protections
of Property Seizure
A.
Fuentes v. Shevin
1. A notice and a hearing should be
provided before seizure of property, so that a deprivation can
still be prevented. The hearing should take place before a judge.
2. Even if the title to property is
not in defendant's name, he owns property because he has made payments
on it. Thus, he is entitled to certain protections, such as a pre-attachment
hearing, under the Due Process Clause.
3. There are "extraordinary
situations" that justify postponing notice and opportunity
for a hearing.
a. Seizure must be directly necessary
to secure an important governmental or general public interest.
b. There has been a special need for
very prompt action.
c. The state has strict regulations regarding enforcement
of seizure; and the person initiating the seizure has been a
government official responsible for determining, under
the standards of a narrowly drawn statue, that it was
necessary and justified in the particular
instance.
B.
Mitchell v. W.T. Grant Co.
1. There must be a verified affidavit that includes specific facts
as to why attachment is necessary.
2. There must be some allegation of
extraordinary circumstances
3. There must be judicial authorization
4. An immediate post-deprivation hearing is required. A PRE-
DEPRIVATION HEARING IS NO LONGER REQUIRED.
5. There should be a bond requirement
(twice the value of property)
6. There should be damages awarded
for wrongful seizure.
C.
North Georgia Finishing, Inc. v. Di-Chem, Inc.
1. The Supreme Court ruled that a couple
of state statutes were unconstitutional because they:
a. Allowed a clerk, not a judge, to
issue a write of replevin.
b. There was no provision for a prompt pre- or post-
deprivation hearing.
c. There was no requirement for a bond to protect
against wrongful seizure.
d. It was easy to allege that lessee might hide or transfer
property. No personal knowledge was required to make
allegations.
D.
Connecticut v. Doehr (Sherman says that this is a reaffirmation
of the spirit of Fuentes.)
1. The Connecticut Statute was unconstitutional
because:
a. It authorizes prejudgment attachment of real estate
without prior notice (this is
to prevent arbitrary deprivations of property)
b. A lengthy period of time often passed before a
defendant was allowed a post-deprivation
hearing (weigh costs of this against constitutional rights)
c. The statue does not require a bond
2. What is required to make statute
constitutional:
a. There should be a timely notice
to defendant that his property is going to be seized AND
b. There should be a prompt pre- or
post-deprivation hearing.
c. Four of the nine justices -- not a majority of the court --
argued that a bond should be required to protect the
defendant against wrongful property
seizure.
3. The court in Connecticut
applied a three-part test (as enumerated in Matthews v. Eldridge),
normally used in government seizures, to seizures between private parties
(51). These three factors, used to judge the validity of a state
statute dealing with pre-judgment attachment, must be balanced against
each other:
a. Strength of D's private interest:
The interest of the private party being harmed by the attachment, which
places a severe restriction on the property’s alienability and encumberability
(i.e., diminishes property’s value). The more important D's
property right, the harder it is for due process to be satisfied.
Example: A record player
would be considered a less significant private interest than a refrigerator
(especially if D needs to take her medicine cold) or a house (which,
after a seizure, D will have difficulty selling or remortgaging).
b. Risk of erroneous deprivation:
The greater the risk that the particular procedures being used will
result in an erroneous interference with D's property rights, the harder
it is for the procedure to pass due process scrutiny.
NOTE: This is why a
bond is posted by P -- so that the individual will have recourse
if wrongfully deprived of his property. Sherman says that in some
cases a bond that is double the value of the property may not be enough.
NOTE: It is more difficult
to gauge the risk of erroneous deprivation for a suit for battery than,
say, a suit for breach of contract. This is because the former
is so much more fact-laden, and thus an affidavit doesn’t seem to
help much (two people are likely to have different versions of what
really happened).
c. Interest of the party seeking
the remedy: If the party seeking attachment has no reason
to fear that the property may be secreted (i.e., covertly appropriated),
then his interest is not all that compelling.
E. Clues to a bad statute -- These are statutory provisions that make it more
likely
that a due process violation will be found:
1. P doesn't post bond -- Due
process could be violated if the statute doesn't require P to
post a bond (even if there's a hearing and some showing of exigency),
from which D can collect damages should there be a wrongful attachment.
(No bond heightens the risk of erroneous deprivation.)
2. Deprivation before hearing -- If D does not get notice for a
hearing until after the attachment, a due process violation
is much more likely to be found than if the notice arrived
before attachment. But even a pre-attachment hearing does
not completely protect the statute, if the risk of an erroneous
deprivation is too high or P's interest in having attachment
is too weak.
NOTE: Even if D’s property
is attached before a hearing, Mitchell offers a number of safeguards
which, if followed, can perhaps still make the statute constitutional.
These safeguards include:
(1) allegations of extraordinary
or exigent circumstances
(2) verified affidavit authorized
by judge (or, less favorably, a justice of the peace)
(3) damages for wrongful seizure
(i.e., a bond)
(4) immediate post-deprivation
hearing
3. Clerk rather than judge -- If decision whether to allow the
attachment is made by a clerk rather than a judge, a due
process violation is more likely to
be found. (One who is personally knowledgeable about the matter.)
4. Conclusory statements -- If P is able to obtain attachment
by making conclusory statements rather than by making a
detailed disclosure of the underlying facts of the dispute, due
process is more likely to be violated.
NOTE: Sherman says that
we should approach a possible Due Process violation by first applying
the three-fold inquiry from Connecticut. (That is to say,
a statute can be found unconstitutional if it falls short under Matthews.)
He says there are really no hard-and-fast “rules" about an unconstitutional
statute.
Postjudgment
Remedies
I. Three Types of Damages:
Monetary, Equitable and Declaratory
A.
Monetary damages -- This is the usual remedy in our legal system.
1. Three primary types of monetary
damages
a. Actual or compensatory damages -- These are damages that will compensate the injured party for injuries sustained,
and nothing more. The rationale behind compensatory
damages is to restore the injured party to the position he
was in prior to the injury.
b. Punitive or exemplary damages -- These are damages on an
increased scale, awarded to P over and above what will
compensate him for his injury. The purpose of these
damages is to punish D and/or set an example for
similar wrongdoers, and they
are most often awarded in cases of defamation, civil rights violations,
and 4th Amendment violations.
c. Nominal damages -- These are a trifling sum awarded to P in
an action where there is no substantial
loss or injury to the compensated, but still the law recognizes a technical
invasion of his rights or a breach of D's duty. These are also
awarded in cases where, although there has been a real injury, P's evidence
entirely fails to show its amount.
NOTE: Sherman says that nominal damages (like for $1) vindicate
the cause of a plaintiff's case, and
that they are a way “for courts to speak out.”
2. Attaining monetary damages
a. Our legal system's concept of damages: "The cardinal
principle of damages...is that of compensation for the
injury caused to plaintiff by defendant's breach of duty...
[damages are available for actions] found to have been
violative of constitutional rights and to have caused
compensable injury." Thus, just as tort law requires
actual injury for compensation to be merited, violation
of constitutional rights requires actual injury for
damages to be merited.
Carey v. Piphus
NOTE: Must be actual
damage -- In the absence of actual harm, such as proven emotional
suffering or mental anguish that resulted from constitutional violations,
only nominal damages can be awarded. Thus, a violation of
constitutional rights does not automatically result in
punitive or compensatory damages -- actual damage
must be shown. Carey.
b. There is not always a scientific
measurement for damages. There are occasions, such as with mental anguish,
where there is no single formula for damages.
(1) Often times, the reality is that pain and suffering
are difficult to measure and prove, so Ps are
routinely allowed to recover without a specific
showing of the extent of these damages.
(77)
Example: In Mieske
v. Bartell Drug Co., Ps recovered $7,500 for loss of their home
movies, which included their wedding, honeymoon, vacations and their
children growing up. The jury was instructed not to compensate for sentimental
value, but it's doubtful they really followed these instructions.
(2) Market value is not the appropriate
measure for damages in all situations. Damages are meant
to compensate for the loss actually sustained, or the "actual
worth to the owner" (sentimental value excluded). No general
rule can be laid down as to how to determine the amount of such loss.
Wall v. Platt
Example: In Wall,
a railroad started a fire that destroyed P's house and the contents
of the house. Although the house would cost $5,250 to rebuild, rebuilding
it would only add $3,250 to the value of the lot without the house.
Ct. awarded P $5,250 on the ground that it reflected the "real
value" of the house. Although D attempted to argue that the items
in the house were used and second-hand items could be obtained very
cheaply, the court upheld a significantly higher amount as proper for
the "intrinsic value of the articles," looking at the cost
of new replacement articles and then determining their "worth to
the owner" in light of their condition at the time of the fire.
3. Enforcing monetary damages
a. A money judgment is "not an order to the defendant;
it is an adjudication of his rights or liabilities. No one may
be held in contempt for failing to pay some debts as
adjudicated by the law court" (78). If D does not pay
judgment, P, now known as "judgment creditor,"
must take further action against D, now known as
"judgment debtor."
(1) P's methods of acquiring money
judgment:
(a) Since judgments ordinarily can
be enforced against assets, as opposed to income, P only has a limited
opportunity to reach D's earnings (i.e., Deducting child-support
and alimony payments from income of "dead-beat" parent).
(b) Try to locate assets of significant value. If
they're located, P can obtain a writ of
execution from the court directing a sheriff
or similar officer to "levy" assets. "Levying"
can be the physical seizure of assets, or
service of an order on a debtor of D, such
as a bank or employer, ordering them to pay
the money over to court.
(2) D's methods of avoiding paying
judgment:
(a) Certain of D's assets, such as his car,
clothing, furniture, etc. are exempt from
seizure.
(b) D can declare bankruptcy, which can
protect him against creditors and judgments.
B.
Equitable relief: The court can impose an injunction or specific
performance
1. Injunction v. Temporary Restraining
Order (TRO). Rule 65.
a. An injunction can be issued only
after notice (and opportunity to be heard) to the adverse party and
can last indefinitely. In order for a temporary or permanent injunction
to be granted, the court must ask (as listed in Note 1, page 85):
(1) whether P has actually succeeded
on the merits
(2) whether he has an adequate remedy
at law
(3) whether he risks imminent, irreparable
harm
(4) whether the balance of hardships weighs
against issuance of an injunction
(5) whether an injunction would serve the public
interest; and
(6) whether the court can, as a practical matter,
administer the injunction
b. A TRO may be granted without
notice to the adverse party -- It can be done ex-parte, but
cannot remain in effect for more than 10 days. If "good cause"
is shown, the TRO can be extended for the same period as the previous
TRO. In order to get a TRO, P must show:
(1) Irreparable injury -- P's
interest far outweighs D's; AND
(2) That P has a good chance of winning
the suit on its merits.
NOTE: Rule 65(b) permits TROs on a verified complaint showing that the petitioner will suffer “immediate and irreparable injury, loss, or damage” if restraining order is not granted.
c. Both an injunction and TRO are similar
in that they direct a party to do, or cease doing, something.
2. Attaining equitable relief
a. Where monetary damages would prove inadequate, an
individual may seek an injunction enforcing some right
he claims has been violated. "Money damages, even
though inadequate, are the best possible remedy once
physical damage is done, but they are certainly
inadequate to compensate permanent injury which
could have been prevented. Plaintiff should not be
required to await the harm's fruition before he is entitled
to an inadequate remedy."
Smith v. Western Electric Co.
3. Enforcing equitable relief
-- There are three ways to enforce equitable decrees:
(1) Criminal Contempt -- Violation of a court's order
can be prosecuted as a crime. The distinguishing
feature of criminal contempt is that the penalty
imposed is not designed either to compensate P or
to prompt compliance in the future. Guilt must
be proven beyond a reasonable doubt.
(2) Compensatory Civil Contempt
-- The court can direct D to pay P an amount that will compensate P
for the harm caused by violation of decree.
(3) Coercive Civil Contempt
-- The court may impose a penalty on D in order to prompt future compliance
with the decree (rather than punishing D for past violations). The penalty
can be severe, including imprisonment for an indefinite period or hefty
fines (i.e. in a lawsuit, IBM was fined $150,000 per day until it turned
over documents). This would be best contempt remedy for Smith
if D did not comply with injunction.
C.
Declaratory Judgment -- This is a court order declaring the respective
rights of the parties. For example, A is using a process that
violates B's patent. B lets A know that A is in violation of B's
patent rights. A responds to B by saying that he is not violating
B's rights. A and B can go to court and have the judge decide
the issue in what is known as a "declaratory judgment."
This judgment allows A not to go through all the actions and consequences
-- what Sherman calls "taking the fatal steps" -- before going
to trial. Thus, A does not have to continue violating B's patent
and wait until B brings a lawsuit that claims all sorts of damages.
A and B can simply seek a declaratory judgment.
NOTE: A declaratory judgment
is neither equitable or legal. Generally, it is decided by a judge,
and it can involve a full trial.
D.
Collateral bar rule -- D cannot challenge the validity of the injunction
in the "collateral" contempt proceeding. In other words,
once an injunction is issued, then it must be followed. If D wants
to challenge the injunction's validity, then he can appeal it, but in
the mean time he must follow injunction. (93)
NOTE: D’s following
the injunction (like with the MLK march) is predicated on the belief
that there must be some certainty within a legal society.
II. Justiciability
A. In the federal judicial system,
courts are to decide only "cases" or "controversies."
The controversy must be definite and concrete, touching the legal relations
of parties having adverse legal interests. It must be a real and substantial
controversy, as opposed to an opinion advising what the law would be
upon a hypothetical set of facts.
B. Justiciability--whether it is feasible for a court to carry out and enforce
its decision--has been broken down
into a number of doctrines, each of which must be met in order to bring
suit:
1. Ripeness -- It is not enough that a controversy might
one day erupt; P must show that it has already done so,
thereby presenting a legal issue in
a concrete context.
2. Standing to sue -- P must demonstrate that he is
"himself among the injured," and that he has a direct
stake in the case or controversy. P must suffer an "injury
in fact" and have a "personal stake" in the outcome that
differentiates him from the public
at large; and
3. Mootness -- The requisite personal interest that must
exist at the commencement of the litigation (standing)
must continue throughout its existence (mootness). In
a sense, an amalgam of ripeness and standing--the suit
may be pursued only if there's an actual controversy
in which plaintiff still has a personal
stake.
NOTE: Where the controversy
would seem to unavoidably expire before adjudication, the mootness problem
may be disregarded if the problem is "capable of repetition, but
evading review."
4. Feigned or collusive cases -- P must assert himself: P
himself must assert his own interest.
Thus, a landlord cannot get a tenant to sue him over a "rent control"
regulation just to test the regulation's validity.
NOTE: In issues involving the First Amendment, there
is a more lenient standard for ripeness. The rationale
for this is two-fold: 1) there tends to be a chilling effect
from something, such as a speech code or local ordinance,
that curtails free speech and 2) we hold particularly sacred
our First Amendment rights. For example, if Stanford has an arguably unconstitutional speech code written into the
Code of Student Conduct, a student
can challenge the speech code, even though he has not actually violated
it or suffered an "injury in fact," since he is in general
subject to the speech code.
Alternatives
to Litigation
I. Types of alternatives
to litigation
A.
The means of dispute resolution range from the parties' informally discussing
and negotiating the conflict, to more formal processes outside the court
system (like mediation and arbitration), and finally to reliance on
alternative processes integrated into the court system (like summary
jury trials and court-annexed arbitration). Judges today are very
much involved in the promotion of settlement, whether through informal
jawboning, or more formal ADR devices. There are three alternatives
to a full trial:
1. Negotiation and settlement promotion
-- This is when the lawyers of parties meet together and try to resolve
the dispute. The court, under Rule 16, can try to facilitate settlement
by suggesting to parties that they negotiate.
2. Third-party intervention
-- This is when a third-party intervenes to help settle the dispute.
This mediation is different from negotiation because a third-party,
called the "mediator," is involved.
a. Unlike a judge, the mediator lacks
any authority to decide who is right. Furthermore, the parties
are not bound by legal rules about behavior.
b. The mediator performs primarily
two important tasks:
(1) Reducing the level of antagonism
between the parties, and persuading them to trust each other.
(2) Being creative and suggesting alternative
approaches which may facilitate agreement.
c. Once the parties agree voluntarily
to a specific solution, the mediator will put the agreement in writing
and have the parties sign it. This agreement is legally binding,
if it satisfies the requirements of contract law.
NOTE: Mediation is what
Sherman calls “bargaining in the shadow of the law.”
3. Arbitration -- This form
of dispute resolution resembles adjudication more than mediation because
a third person, the "arbitrator," has the authority to
decide the dispute, not merely to try to get the parties to agree
on a decision.
a. An agreement to arbitrate could
occur after the dispute arises, but ordinarily it is part of an agreement
on some other subject between the parties prior to the dispute (i.e.,
a clause in a contract that states, should there be a dispute, it shall
go to arbitration).
NOTE: These arbitration clauses are being challenged as a
"coerced abdication of the right
to jury trial," and as protecting companies and corporations from
large monetary awards by juries.
b. Evidence-gathering, calling witnesses,
the timing and place of hearing, etc., are all part of arbitration,
and are decided on by the parties.
c. After a hearing, the arbitrator
renders a decision, called an "award," which does not contain
the reasons for the result (except in labor arbitration). In reaching
this decision, the arbitrator does not have to follow the law, and his
judgment can be obtained in court on the basis of this award. His award
is final, and there can be no appeal -- absent something like bribery.
NOTE: Sherman considers
arbitration to be an extra-judicial measure, in which parties in essence
waive their 7th Amendment right to a trial by jury.
B.
Adjudication v. alternatives to litigation:
1. Alternatives to litigation are conducted
privately and extrajudicially.
2. Alternatives are not bound by court
procedures nor strict standards of evidence, and there is no "robed
judge and ritual."
C.
Advantages and disadvantages to alternative litigation:
1. Advantages
a. Savings of cost and time both
to litigants and court system
b. Tends to be a better outcome for
parties in a flexible system structured by the parties, as opposed to
rigidity of court procedure.
c. Finality -- If the settlement
is legally binding, then it cannot be appealed.
d. Case can be kept out of courts and
is not part of the public record, which can be an advantage or disadvantage
depending on how you see things.
2. Disadvantages
a. Does not explicate and give force
to the values embodied in Constitution and statutes. Prof. Fiss (110)
b. Arguably diminishes the judicial
development of legal rights for disadvantaged. Judge Edwards (110-111)
c. Arguably is "coerced abdication of the right to jury trial," and protects companies and corporations from large monetary awards by juries.
Describing
and Defining the Dispute
I. Historical Evolution
of Pleading
A.
The word "pleading" derives from the practice that developed
after the Norman Conquest (1066) by which the persons filed pleas in
the royal courts for a remedy against one who had wronged them.
B.
The courts responded to a pleading by issuing a writ
-- an order to the sheriff to bring the person before the judge on a
certain day to answer.
1. The standardization of writs resulted
in the development of forms of action, and a suit had to be cast
in one of the forms of action. Examples of different common law forms
of personal actions:
a. Trespass -- An action for
damages for direct, unlawful injury to plaintiff's person, property
or rights (i.e. hitting a person with a stick)
b. Case -- Action that developed from the situation in
which the injury was an indirect consequence of D's act
(i.e. leaving a stick on a walkway where a pedestrian is
injured tripping over it).
c. Covenant -- An action for
damages for b/K
d. Debt -- Action to recover a specific sum of money due
under an express agreement.
e. Assumpsit -- Action for damages for non-performance
of a contract not under seal. It was based on the premise
that D had promised to do something and injured P
in his person or goods by failing to
perform.
f. Detinue -- An action to recover personal chattels from
one who acquired them lawfully, but retained them w/o
right (i.e., a bailment).
g. Replevin -- Action to recover
possession of stolen goods.
h. Trover -- Action for damages against a D who had found
another's goods and wrongly converted
them.
C.
There were numerous disadvantages to the system of common law pleading,
which was used in U.S. until the 1830s.
1. The process of pleading was designed
to reduce the dispute to a single issue, which reached an extraordinary
degree of complexity in by the 19th century.
2. The old common law form of pleading
began to change because of the pigeon-hole strictness of writs.
D.
"The American Reform Experience" -- Changes in Pleading since
1830s
1. "Code pleading" came into existence in 1848. It abolished
the existing writs and mandated that there be only one form
of action. The complaint only had to contain "a statement of
the facts constituting the cause of action, in ordinary and concise
language."
2. Under code pleading, pleadings were limited to complaint,
answer, reply and demurrers.
3. Code pleading had a profound impact on the Federal Rules
of Civil Procedure (FRCP).
E.
The following functions may be served by pleadings:
1. Demonstrate that the court has jurisdiction of the subject
matter of the action (Rule 8(a)(1)).
2. To give notice of the nature of
party's claim to adversaries.
3. To identify and separate the legal and factual issues in an
action.
4. To present evidence
5. To narrow the issues for trial
6. To provide a guide for discovery
and trial
7. To expose insubstantial claims
F.
Typical Pleadings under the FRCP
1. The pleadings allowed in federal courts are: complaints,
answers, replies (to counterclaims), answers to cross-claims,
third-party complaints, and third-party
answers. Rule 7(a).
a. The complaint is the initial pleading filed in any civil
action and contains the basic allegations that describe P's
reason to complaint of D and the relief
or response P seeks.
b. Answers contain D's responses to the material in pleadings and can add additional material constituting
defenses of sorts. The answer may also contain a
counterclaim that presents allegations D makes against P,
and a cross-claim in which the defending party would
make against a co-defendant. P has to respond to this
counterclaim. Likewise, a co-defendant would have to
respond to a cross-claim.
c. Finally, a third party complaint is made by a defending
party against additional people who are not yet parties
to the controversy and the responses
of those parties.
Mnemonic: CAT PaC
2. As with any pleading seeking relief,
there are the three essential parts of
all claims (Rule 8(a)):
a. Jurisdiction: A short and plain statement of the grounds
on which the court’s jurisdiction depends (unless the court
already has jurisdiction and the claim needs no new grounds of
jurisdiction to support it, e.g., a
compulsory counterclaim.
b. Claim: a short and plain statement of the claim showing
the pleader is entitled to relief. It need only identify the
occurrence from which the claim arose so as to notify
defendant of the claim; AND
c. Relief:
A demand for judgment for relief the pleader seeks.
NOTE: These elements apply to crossclaims, third party claims, and
counterclaims, as well as complaints.
NOTE: There is a difference between pleadings and motions. If
a D files a 12(b)(6), this is not treated as a pleading, but as a motion.
This has important ramifications. For example, FRCP require that
a P is free to amend his complaint one, as of right, before D files a
responsive pleading. If D, instead of filing a pleading, files a motion
for 12(b)(6), then P still has the
opportunity to amend his complaint.
II. Describing and Testing
the Plaintiff's Claim
A.
"Notice Pleading" (Rule 8 of FRCP)
1. Rule 8, in an effort to get away from "facts" and "cause of action," requires only that P provide a "short and plain
statement of the claim showing that the pleader is entitled
to relief." This "statement" essentially serves the task of
general notice-giving.
a. Some federal courts have resisted the
liberal pleading requirements associated with
"notice pleading." As Judge Posner argues, it
is too much of a burden on federal courts to simply
admit pleadings in which "there is no reasonable
prospect that the plaintiff can make out a cause of
actions narrated in the complaint."
b. Some courts, though, will uphold the sufficiency
of the complaint even though there is a failure to
state the specific claim in the pleading.
EX: In Conley v. Gibson, black union-members accused their union of racial discrimination. Though the complaint contained no specific, direct factual allegation indicating conscious discrimination by the union, the
U.S. Supreme Court upheld the sufficiency of the
complaint, arguing that the complaint
gave the union fair notice of the legal issue at hand.
B. Motion to dismiss the complaint (Rule 12(b)(6)) and Rule 12(c),
12(e)
and 12(f)
1. If D believes that P's complaint does not state a legally
sufficient claim, he can make a 12(b)(6) motion to
dismiss for "failure to state a claim upon which relief may
be granted.” The motion should assert that the facts are true as
indicated in P's complaint, but that no recovery is possible under any
legal theory. Rule 12(b)(6) is similar to what was once called
a "demurrer" in old common
law.
2. A Rule 12(b)(6) motion must not be granted "unless it appears
beyond doubt that the plaintiff can prove no set of facts in
support of his claim which would entitle
him to relief."
3. If a motion under 12(b)(6) is granted,
P can either:
a. Continue the action in trial court by amending the
pleading without prejudice OR
b. Appeal the decision on the motion. If P loses on appeal, the
court can allow P to re-plead, or remand to the trial court and
let the trial court decide whether to allow re-pleading. It is
doubtful, though, on remand that a trial court would be
sympathetic to a plaintiff who gambled on appeal rather than
re-pleading.
4. Summary Judgment vs. a 12(b)(6)
Motion
a. Like a 12(b)(6) motion, a summary judgment is
another way to dismiss a complaint. However,
there is an important distinction between these
two motions:
(i) A 12(b)(6) motion tests the allegations
of the complaint and does not get into factual issues. A motion
for summary judgment, on the other hand, tests the factual support of
a complaint, even if the complaint is adequate.
5. Rule 12(c) is what Sherman calls the "plaintiff's 12(b)(6).”
Under 12(c), the plaintiff scrutinizes the defendant's answer to
see if by law the plaintiff is automatically entitled to judgment.
Rule 12(c) applies primarily to the plaintiff after there has been
an answer that is inadequate to stand up to the complaint, while
12(b)(6) applies to the defendant if he thinks the plaintiff's
complaint does not allege a cause of
action.
6. Rule 12(e) is a motion for a
more definite statement
a. Under 12(e), if the complaint is "so vague or ambiguous that
[the defendant] cannot reasonably
be required to frame a responsive pleading," then the defendant
may move for a more definite (or specific) statement.
b. The defense has recourse if the complaint does not
give them enough evidentiary information. They
can seek discovery under Rules 26-36. For this reason,
courts are reluctant to grant a more
definite statement. Board of
Harbor
c. If the pleading is "unintelligible,"
rather than lacking detail, then the complaint must be clarified.
U.S. v Board of Harbor Commissioners
d. There are strategic reasons to being evasive in a
complaint (i.e. plaintiff or prosecution does not have
to "flesh out" its case and
"tip its hand" to the defense). Board of Harbor
NOTE: Rule 12(e) applies to the plaintiff as well as the defense.
For example, if P thinks D’s counterclaim is, say, unintellgible
or too vague, then he can file a 12(e)
motion.
6. Rule 12(f) provides a motion to strike "redundant, immaterial,
impertinent, or scandalous matter"
or "any insufficient defense." It applies to all parties
involved.
III. Consistency and honesty
in pleading
A.
Inconsistent allegations (Rule 8(e)(2))
1. Numerous allegations, even if they are contradictory or
inconsistent, are permissible
in a case, so long as the plaintiff does not have knowledge of the true
facts. McCormick v. Kopmann
EX: P sought damages for a broken kettle, which he alleged
D had borrowed and returned in cracked condition. D
responded that: a) he never borrowed the kettle, b) it was
never cracked, and c) it was cracked when he borrowed it.
So long as D did not have actual knowledge of what exactly
happened, he can plead these three different, inconsistent
answers.
NOTE: Inconsistent allegations are allowed because of the uncertainty
in outcome of different trials. P is not forced to file different suits
because this puts P in a disadventageous position, since separate trials
could lead to inconsistent results.
(Note that this may lead to unfairness for Ds, as there is now a chance
that P can be in cahoots with one D.)
B.
Honesty in pleading and preventing frivolous lawsuits (Rule 11)
1. Rule 11 applies to all papers filed
with the court, whether they are papers, motions, answers, etc.
Its central purpose is to discourage
frivolous lawsuits, which have several adverse impacts:
a. unduly denigrate reputations of
companies
b. burdensome on the court system (this
has been a particularly salient concern over the last 10 years, in which
ADR has become more popular)
c. burdensome on society (see Albright
v. Upjohn)
NOTE: Most people feel that the 1993 amendments to the FRCP
weaken Rule 11.
NOTE: Sherman points out
the tension here between access to the court system and abusive lawsuits.
2. The pleader's lawyer must sign the pleading, "certifying that
to the best of his knowledge, information, and belief, formed
after an inquiry reasonable under the
cirumstances" that (this is Rule 11(b)(1-4)):
a. the pleading is not presented for any improper
purpose (i.e., to harass or to cause
unnecessary delay).
b. the claims, defenses and other legal contentions are
supported by existing law or by a non-frivolous argument
for the extension, modification or reversal of existing
law or the establishment of new law.
c. The allegations and other factual contentions have
evidentiary support
d. the denials of factual contentions are specifically
warranted on the evidence or are reasonably based
on a lack of information or belief.
e. Under 1993 amendment to Rule 11(b)(3), the allegations
for which there is a lack of present evidence must be
specifically identified in the pleading, as long as there is "likely to be evidentiary support," as opposed to
"factual support," after a reasonable investigation.
What precisely "likely" means depends on how a judge
decides to interpret it.
3. Defining "reasonable inquiry" -- a "reasonable inquiry" refers
to what a reasonable person would do in investigating the
facts of an allegation.
a. If a lawyer makes a "reasonable inquiry" before
filing the pleading, then later learns that the pleading
is not meritorious, then he must withdraw the pleading
or face sanctions.
b. A lawyer is not responsible for launching independent
investigations if he has no reason to doubt his client's
story. But he should ask client if his story can be
corroborated. 140-41
c. Sanctions can be awarded without a showing that the
lawyer behaved in bad faith. If he honestly believes
the inquiry to be true, but a reasonable person would have
made inquiries that would have shown complaint to
be false, then sanctions may be imposed.
4. Rule 11 allows the court to impose a number of sanctions
on lawyers who violate Rule 11. Sanctions are limited to
what will "deter repetition of such conduct" by others in a
similar situation.
NOTE: Normally, the opposing
party makes a motion to impose sanctions, but the court can also impose
sanctions on its own initiative.
a. Monetary sanctions -- The most common sanction is a
monetary fine. In the 1993 changes
of the Rule, the penalty is paid to the court, and will paid to the
other party only if "warranted for effective deterrence."
Rule 11(c)(2).
NOTE: The judge decides whether the lawyer or the
client is responsible for the violation of Rule 11,
and fines him accordingly.
b. Other sanctions -- These can include non-monetary
measures such as censuring the offending lawyer,
striking the offending pleading, etc.
c. Sanctions discretionary --
Since 1993, sanctions are no longer required.
5. "Safe harbor provision" -- Under the 1993 amendments to
Rule 11, if a party seeking sanctions serves a motion on the
other party, then the offending party has a 21-day "safe
harbor" in which to withdraw or correct any bad pleading.
If the offending party does withdraw the pleading, then there can be no sanctions, no matter how outrageous the original
misconduct.
NOTE: Even if a party withdraws a bad pleading, they are
still responsible for the opposing party's attorney's
fees and other "reasonable expenses."
IV. Scrutinizing the Legal
Sufficiency of Plaintiff's Claim
A.
Failure to include facts under 12(b)(6)
1. A complaint that fails to include facts constituting a cause
of action can be dismissed under 12(b)(6).
Mitchell v. A&K Inc.
EX: Mitchell (P) filed a complaint against A&K (D) for
injuries he sustained from a robber's shotgun blast
after D asked P to park and wait on a close side street
before making a delivery. The U.S. Appeals
Ct. upheld the lower court ruling to dismiss the complaint
on the grounds that the adjacent street was not part
of D's "premises."
2. The facts of a complaint cannot be amended between the
trial court and the appellate stage. The complaint should
be amended at the lower court stage.
Mitchell.
EX: Mitchell did not claim in his lower court complaint that
adjacent street was part of D's "premises." However,
he amended the complaint after the lower court ruling,
arguing to the U.S. Appeals Court that the street was part of D's
premises. The Appeals Court, though,
noticed the complaint was altered and affirmed the lower court’s dismissal
of the complaint.
V. Heightened Requirements
for Specificity
A.
Claims based on fraud or mistake (Rule 9(b))
1. When claims are based on fraud or mistake, Rule 9(b) requires
that the plaintiff plead "with particularity." Ross v. A.H.
Robins Co. The detailed evidentiary pleading applies to disputes like common law fraud, securities fraud, and actions to rescind
or modify a contract for mutual mistake.
a. For securities fraud it must specifically
be shown that:
(1) There were misrepresentations, which have to
specifically be pleaded, AND
(2). There was knowledge of misrepresentations,
or of what rule 9(b) calls "malice, intent,
knowledge, and other conditions of
mind." Ross.
2. Different courts view pleading "with particularity" differently. They
usually look to whether P has provided specifics concerning the
date and content of representations on which a fraud claim is
based. If there are multiple Ds, it may be necessary for P to
specify the involvement of each one, sometimes requiring
great detail. However, some courts say that to satisfy Rule
9(b), P need provide only "slightly more" than that required
in "normal" pleading under
8(a)(2).
3. Courts explain that the added specificity is important to
provide added notice and that it protects Ds against
unfounded claims that damage their reputations. However,
there are criticisms:
a. Some argue that it is difficult to understand why the claims covered by Rule 9(b) give rise to especially troubling problems compared with other types of claims.
b. Sherman adds that a judge can capriciously
rule under 9(b) what cases require heightened specificity in pleadings.
c. Sherman also feels that at the early pleading stage,
where there is no discovery yet, a great burden is put on
P to plead specifically.
d. Sherman's solution is to have some abbreviated form
of discovery in issues of fraud or mistake, instead of
simply dismissing complaints that do not conform to
Rule 9(b).
4. Supreme Ct. has disapproved of heightened specificity
requirements in civil rights cases, which are not governed
by Rule 9(b). However, the Ct. argues that suits involving
government officials might very well fall under the
strict pleading standard of Rule 9(b).
Leatherman.
5. Supreme Ct. has ruled that under "qualified immunity,"
which applies to government officials, the official's state of
mind at the time of the violation of a citizen's right should
be judged by a "reasonable person" standard, not by the
official's actual state of mind. The Ct. also ruled that "unless
the plaintiff's allegations state a claim of violation of clearly
established law, a defendant pleading qualified immunity is
entitled to dismissal before the commencement of discovery."
Harlow v. Fitzgerald. (The rationale
for this burden on P is that these sorts of claims directly interfere
with governmental functions.)
NOTE: Sherman points out that this puts a heavy burden on
the plaintiff -- a case can be dismissed if the official raises an
affirmative defense and D cannot state a "violation of clearly
established law,” which must occur before discovery.
P must prove that D acted in bad faith.
B. "Special matters" under Rule 9 that must be pleaded with
particularity.
1. In addition to the general requirement of a "short and
plain statement of the claim" imposed by Rule 8(a), certain
"special matters" must be pleaded with particularity if they
are to be raised at trial. These "special matters" are ones
of notice which are thought to be necessary in order for the
defendant to be able to prepare for trial. They are typically
claims which the adversary will not be expecting unless his
attention is specifically called to
them.
a. any denial of any party's legal capacity to sue or be
sued. 9(a)
b. the circumstances giving rise to any allegation of
fraud or mistake. 9(b))
c. any denial of the performance or occurrence of a
condition precedent. (9(c))
d. the existence of judgments or official documents and
acts, on which the pleader plans to rely. (9(d)) and (e))
respectively
e. material facts of time and
place
f. special damages. (9(g))
g. certain aspects of admiralty and maritime jurisdiction
(9(h))
NOTE: According to Rule
26, discovery is limited by pleadings.
C.
Two rules of construction in interpreting statues and contracts:
1. Expressio unius est exclusio alterius -- "Expression of one
thing is done at the exclusion of others." Supreme Ct. employs
this phrase in Leatherman to make the point that Rule
9(b) applies to what it says it applies to -- fraud and mistake --
and to nothing else (i.e., civil rights).
163
2. Ejusdem generis -- Refers to idea that when a general term is followed by an enumeration of specifics, the general term should
be limited to its specifics, not construed
to its widest extent.
EX: There is a lean against all property on a person's premises,
including jewelry, clothes, and antiques. However, the general
term of the lean is limited to machinery, followed by an
enumeration so specifics such as "computers," "electric tools,"
"automotive vehicles," etc. Is the lean against the property
legal? The answer is no, because this
violates the general term of the lean, as well as its enumerated specifics.
Defendant's
Response
I. The General Function
of a Motion and an Answer for Defendant
A.
The answer
1. Makes denials of factual allegations and asserts affirmative
defenses. Rule 7, 8(b), 8(c)
a. The FRCP provides that all objections--except a request
to make the complaint more definite and certain (which
should be raised in the motion)--can be raised in the
answer.
b. The answer may accordingly include denials,
affirmative defenses, a demand that complaint be
dismissed for failure to state a claim (Rule 12(b)(6)),
an objection to service of process, a request for change of
venue, etc.
B.
The motion
1. Deals with appropriate remedies--dismissal for defect in
service of process, want of jurisdiction, failure to state a claim,
expiration of statute of limitations, a requirement that P join
additional parties, or a requirement that P make the complaint
more definite and certain. Rule 12(b),(c),(e),(f)
a. The FRCP provides that D can have an optional preliminary stage by means of motion. As a preliminary, D can raise any objection--other than factual
denials and affirmative defenses, which are made in the
answer--by motion before answering (this is what Rule 12
calls a "pre-answer motion").
(1) If D makes a motion at this preliminary stage,
though, all preliminary or formal objections
must be included.
C. Objections not raised in either the answer or preliminary motion are
waived
except for:
(1) failure to state a claim;
(2) failure to join an indispensable
party;
(3) lack of jurisdiction over subject
matter.
These exceptions can be raised up until the commencement of the
"trial on the merits" (the actual trial where the merits of the cause of
action
are judged).
D.
Affirmative and negative defenses
1. The answer to the complaint can either deny one or more of
the allegations, or set forth new facts that avoid the legal effect
of the allegations, or both.
a. Denials of allegations are sometimes called a "negative"
defense.
Rule 8(b).
(1) A denial based on lack of information will be
deemed an admission by the court if the facts
relevant to the issue are within the denying
party's knowledge and control. A party has
the duty to use "due diligence" in denying or
affirming allegations. David
v. C&K Corp.
b. Setting forth new facts are called an "affirmative"
defense.
Rule 8(c).
c. Failure to deny an allegation results in it being
admitted. Rule 8(d)
d. FRCP carry forward a form of pleading that is neither a denial nor an admission but has the same legal
consequence as a denial. When a pleader is "without
knowledge or information sufficient to form a belief
as to the truth of an averment, he
shall so state and this has the effect of a denial." Rule 8(b)
EX: In David, D denied on lack of information that
it manufactured a machine. Ct. ruled that had D used
"due diligence" and investigated the issue--which the
evidence showed was within D's knowledge and
control--then their averment would not be deemed an
admission by the court.
II. Pleadings Under Rule
12
A. The pre-answer
1. If D files a pre-answer motion within 20-day period following
service of the summons and complaint, the deadline for filing
an answer is extended. Rule 12(a)(1).
2. If ct. denies the pre-answer motion or postpones its
disposition, D has until 10 days after the notice of the court's
action to file an answer.
3. If ct. grants the motion,
in most cases the suit will be dismissed.
4. But if a motion for a more definite statement is
granted under 12(e), then D has until
10 days to file his answer after service of an amended complaint containing
a more definite statement.
NOTE: The reason for filing a pre-answer motion is primarily
financial -- it saves D money since he does not have to go through
investigations, discovery, and so on.
B. Consolidation and waiver provisions concerning Rule 12 Motions
(Rule
12(g) and (h))
1. The purpose of Rule 12(g) and (h) is to prevent the pleader
from using multiple pre-answer motions for different
defenses and from omitting certain defenses from motions
or answers.
a. Rule 12(g) provides that if a party makes a pre-answer
motion, but omits one of the Rule 12 defenses then
available, that party cannot make any
further motions.
b. Disfavored defenses--lack of jurisdiction over the
person, improper venue, insufficiency of process, or
insufficiency of service of process--will be waived forever
if omitted from a pre-answer motion or, if no motion
is made, from the answer. Rule 12(h)(1)
c. Favored defenses--failure to state a claim upon which
relief can be granted, failure to join an indispensable party,
and failure to state a legal defense to a claim--can be made
in any pleading, or by motion for judgment on the
pleadings, or at the trial on its merits.
Rule 12(h)(2).
d. Finally, the most favored defense--lack
of jurisdiction of the subject matter--may be made at any time.
Rule 12(h)(3).
EX: A files a tort action against B, the one-armed man, in
federal court, alleging diversity jurisdiction. B then makes
a motion to dismiss for lack of personal jurisdiction. The motion
is denied. B then makes a motion objecting to venue. Can
it be granted? No. When D files a Rule 12 motion, he must
include in it all defenses and objections raisable by motion at
that time (in order to avoid waisting time). Thus, the
disfavored motions cannot be made after the pre-answer or,
as in this case, the answer. Favored defenses can be raised
until judgment is rendered.
C.
Motion to strike (Rule 12(f)) and motion for a more definite statement
under Rule 12(e) must be made before responding to the challenged pleading.
III. Pleadings Under Rule
15
A. Rule 15 sets forth an extremely liberal policy on the amendment of
pleadings.
B. Under the following circumstances, a pleading can be amended
as
a matter of course (i.e., without leave of court):
1. If the pleading is one to which the adversary must make a response (i.e., a complaint must be responded to by an answer --
Rule 7(a)), the pleading may be amended any time before the
answer is served. Rule 15(a).
NOTE: Motions like a 12(b)(6)
are not considered an answer for this purpose.
2. If the pleading is one to which a responsive pleading is not
required, it may be amended within 20 days after it was served.
Rule 15(a).
C. If the requirements for amendment are not met, the pleading may be
amended
only by leave of court, or by consent of the other side.
1. Leave by court to amend "shall be given when justice so requires" (Rule 15(a)). "Justice so requires" is a very loose
standard.
NOTE: The court, though, cannot undercut Rule 12 by granting,
say, an amendment to add a defense that is unfavored under
Rule 12(h). The court is also, of course, subject to the waiver
provision of Rule 12(b).
2. Normally, leave to amend should be denied only if it would
cause actual prejudice to the other
party.
EX: In David v. C&K Corp.,
D denied, on lack of information, that it had manufactured a machine
that injured P. D later moved to amend its answer to deny this allegation.
The court held that if a party waits a
lengthy period of time between discovery of facts making an
amendment appropriate and moving to amend, the motion may be
denied since it often times prejudices P. (For more on this
case, see "Defendant's Response" above.)
NOTE: The are several ways in which the passage of time can
prejudice a party. One example is cited in David. The other
common instance is loss of evidence
over time (memories also fade).
3. In addition to the general principle that leave to amend shall
be given if justice so requires (Rule 15(a)), amendment is
generally allowed at trial when the evidence is objected to as
being outside the scope of the pleadings.
Rule 15(b).
D. Rule 15(c) is specifically designed to circumvent potential problems
with
the statute of limitations, and allows P to add new defendants. There
are three conditions that must be met in order to add a new D:
1. Amendment arose out of same transaction or occurrence as
stated in the original complaint.
Swartz v. Gold Dust Casino
2. New D was aware of the original litigation before the
limitations period ran. Swartz
3. The D added to complaint knew, or should have known,
that he was a proper D. Swartz
EX: In Swartz v. Gold Dust Casino, Inc, P slipped and fell down a stairway. She sued Gold Dust (D). alleging negligent maintenance. Upon discovering a basis for an allegation of defective construction, P amended the complaint to add
Cavanaugh (the other D), a partner in the partnership owning the building. Cavanaugh was also president of Gold Dust Casino, Inc. Cavanaugh's addition was after the statute of limitations
had run. Cavanaugh moved for summary judgment. The
court held that under Rule 15(c), when a newly added defendant has been aware of the litigation, the statute of limitations may
not apply to him. Here, Cavanaugh, as president of Gold Dust,
certainly had notice of the suit.
NOTE: Rule 15(c) cannot "abridge or substitute" the state laws
concerning the statute of limitations.
E. Under 15(d), supplemental pleadings can be filed. The function of
supplemental pleadings is to call the court's attention to material
facts that have occurred subsequent to the filing of the original complaint.
The most typical kind of supplemental pleading under
Rule
15(d) deals with medical conditions.
EX: In an action for personal injuries, a supplemental pleading might
allege aggravation of injuries or increments of damage sustained after
filing
of the original complaint.
NOTE: There is even less chance of prejudice in supplemental
pleading than amending pleading, since the supplemental pleading
just
adds to the original pleading and does not alter the claim or defense
originally asserted.
1. There is no right to file a supplemental pleading. The filing
of such pleadings is permissive, within the sound discretion
of the court.
2. The function of supplemental pleading is merely to add to,
not modify, the original pleadings. If permitted, it does not
replace the original pleading (as would an amended pleading),
but it is a supplement to the original.
3. Rule 15(d) gives the court discretion to allow supplemental
pleadings despite the fact that the original pleading is defective,
or that the supplement would change
the nature of relief sought.
EX: In Swartz, P sued Gold Dust (D) alleging negligent maintenance. Upon discovering a basis for an allegation of defective construction, P was allowed to amend the complaint
under Rule 15(d).
IV. Default under Rule 55
A. Under Rule 55(d), if D has asserted a counterclaim, and P neglects
either to serve a reply or to move against the counterclaim, a default
judgment
may be entered against the P on the counterclaim.
1. Under Rule 55, a default entry may be set aside for "good
cause." Shepard Claims Service, Inc. v. William Darrah &
Associates. Three factors should be considered when deciding
"good cause":
a. Whether P will be prejudiced.
b. Whether D has a meritorious defense.
c. Whether culpable conduct of D led to default. This
culpable conduct has been considered
to be at least a willful disregard for the rules of civil procedure.
Thus, this culpable conduct must be worse than mere negligence.
Shepard Claims.
V. Counterclaims and Cross-Claims
under Rule 13
A. The Federal Rules, in order to promote judicial economy, have
gone beyond the codes with respect to counterclaims. Rule 13
provides
for both "permissive" and "compulsory"
counterclaims.
1. Permissive counterclaim: Rule 13(b) allows assertion as
a counterclaim at the defendant's discretion of "any claim...not
arising out of a transaction or occurrence that is the subject matter of the opposing party's claim." This means that no claim is too far removed from the subject of the plaintiff's claim to be
allowed as a counterclaim. (Exceptions are indicated in Rule
13(d), and in the "presence of third parties" clause of 13(a), but
these are minimal). D may assert this counterclaim in an independent action. It is up to the judge whether or not to grant a permissive
counterclaim.
2. Compulsory counterclaim:
If a claim does arise "out of the transaction or occurrence
that is the subject matter of the opposing
party's claim...," its assertion is compulsory, under Rule
13(a). “Compulsory” here means that it must be asserted in the action
or it will be barred. A counterclaim is compulsory when:
a. It arises out of the transaction
or occurrence that is the subject matter of P's claim; AND
b. Does not require the presence
of third parties over whom the court has no jurisdiction.
EX: In Wigglesworth V. Teamsters Local Union No. 592,
Wigglesworth (P) sued the Union (D) for violation of his
First Amendment rights. At the same time, P accused D
of being associated with organized crime. D filed a counterclaim
almost two months later for defamation. P moved to have D's
counterclaim dismissed for lack of jurisdiction (apparently,
defamation is a state issue, not a federal one). If D could
prove that the counterclaim was compulsory, though, it
could be raised in federal court. The court denied
D's compulsory counterclaim, arguing that it did not have
any "logical relationship"
or share the "same evidence" with P's original claim. The
counterclaim was dismissed.
NOTE: Sherman says that the court in Wigglesworth is wrong
and that there is indeed overlap between the claim and
counterclaim in this case. He also says that the court is not quite clear
in deciding how much evidence a claim and counterclaim
should share in order for the counterclaim to be admitted
(i.e., should it be substantial evidence,
or some lesser amount?). Sherman thinks that the compulsory counterclaim
should have been granted in this case.
NOTE: The most accepted verbal formula is that a compulsory claim arises out of the same "transaction or occurrence that is the subject matter of P's claim" if it is "logically related" to P's claim. Many courts, in deciding whether a counterclaim meets the "transaction or occurrence" test, are especially interested in
whether there is a substantial amount of evidence that bears
upon both the claim and the counterclaim, and which would
therefore have to be considered twice if the counterclaim were
not allowed. Judicial economy, along with the “logically related
test,” play a major role in determining whether a compulsory
counterclaim will be allowed.
3. An important issue is whether a counterclaim is barred by the
statute of limitations (SoL) where it is filed after the statute has
run, but the action (P's complaint) was filed before the statute
ran. The question is considered "substantive" for Erie doctrine
purposes, and hence is resolved by
appropriate state law.
a. The general view is that if the counterclaim arises out of the "same transaction" as P's claim, it will not be barred
if P's complaint was filed before the running of the
statute.
B. Under Rule 13(g), the defendant may set forth in the answer
any claims that he has against a co-defendant that relate to the
"transaction or occurrence" or to any property that is the subject of P's
complaint.
Such cross-claims are not compulsory, however.
EX: P sues D1 and D2, claiming they were jointly negligent in causing
his injuries. Either defendant may cross-claim against the other on
any claim arising out of the same accident. Alternatively, either
defendant could file a cross-claim for contribution against the other,
asserting that both are jointly liable to P and requesting that any
judgment be fashioned accordingly. Also, if one defendant is
only secondarily liable, he may cross-claim for indemnification
against
the other who is primarily liable.
1. Like a counterclaim, the cross-claim should be set forth
as part of the defendant's answer rather than as an independent
pleading. Also, the co-defendant against whom the claim is
asserted must file an answer to
cross-claim under Rule 7(a).
C. There are important differences between cross-claims and counter-
claims. A counterclaim lies only against the opposing party (plaintiff),
whereas a cross-claim is against a co-party (D2). Also, a counterclaim is
sometimes
compulsory, whereas a cross-claim is always permissive.
D. In both cross-claims and counterclaims, if the party subject to the
cross-claim or counterclaim does not serve a reply or move against
the cross-claim or counterclaim, a default judgment may be entered
against
that party. Rule 55(d)
Voluntary
Dismissal by Plaintiff
I. Filing for Voluntary
Dismissal under Rule 41
A. Under the FRCP, the plaintiff retains the right to dismiss his own
action
by filing a notice of dismissal. Rule 41(a)(1)(i)
B. P is limited to one (voluntary) dismissal by notice. Thereafter, any
dismissal operates as a dismissal with prejudice, meaning P cannot
bring
suit again.
C.
P in federal court may voluntarily dismiss his complaint without
prejudice any time before D serves an answer or moves for summary
judgment. Thus, P may dismiss his suit without leave of court and
without prejudice, meaning that he can bring suit again (Rule 41(a)(1)).
EX: In D.C. Electronics Inc. v. Nartron Corp., P dismissed an antitrust
action before D had filed an answer or motion for summary judgment.
The district court entered an order vacating the dismissal, holding
the action had proceeded too far to permit a dismissal without court
approval. The appeals court sharply disagreed with the lower court,
holding that a plaintiff has an absolute right to dismiss an action
before
the defendant files an answer or motion for summary judgment.
D. After D serves an answer or moves for summary judgment, P cannot dismiss without D's consent or a court order. The following is
a
list of what is involved in a court order:
1. The court may grant P's motion for leave to dismiss without
prejudice at any time prior to judgment -- i.e., even after the
trial on its merits has commenced.
Rule 41(a)(2).
2. The discretion of the court to refuse a dismissal without
prejudice is limited.
EX: P making a good faith request based on newly discovered
evidence has been held entitled to a dismissal without
prejudice (to allow re-filing of the action and a new trial) unless
D's substantial rights would be jeopardized.
But the court in this case should not order a dismissal without prejudice
merely to accommodate P's desire to get another 10-day period within
which to demand a jury trial.
NOTE: The court cannot dismiss over the objection of a D who
has filed a counterclaim prior to P’s
motion to dismiss unless the counterclaim can remain pending for independent
adjudication. Rule 41(a)(2).
3. The court is not limited as to the number of times it may
grant motions to dismiss the same action without prejudice --
provided, of course, that there is a legitimate reason for the
repeated requests.
4. P seeking dismissal without prejudice may be required to
bear the full cost of litigation to date, including the
adversary attorney's fees (Rule 41(a)(2)). But such condition
may not be imposed on P seeking to dismiss his claim with
prejudice. Under Rule 11, however, sanctions may be imposed
on P who voluntarily dismisses a groundless
suit.
NOTE: When deciding whether to dismiss P's suit, a court
must consider if the dismissal will prejudice D. This
is essentially the test of dismissal.
Establishing the Structure and
Size of
the Dispute
I. Proper Parties to a Suit
under Rule 17(a)
A. Rule 17(a) provides that "every action shall be prosecuted in the
name of the real party in interest." This means that the plaintiff
must sue in his own name, since it is he who will benefit from the
judgment.
1. The same rule covers subrogation. Suppose an insurer has
already compensated its insured, who is a tort victim. The
insurer is said to be subrogated to the rights of the insured,
and may sue the tortfeasor just as the insured himself could.
Under Rule 17, subrogee insurers have been held to be "real
parties in interest," and must therefore sue in their own
name, not in the name of the
insured.
2. The citizenship of the real party in interest (assignee or
subrogee) controls for diversity purposes.
3. The reason for requiring the real party in interest to be named
relates to the res judicata
effects of the judgment.
EX: Insurance Company pays off claimant, the victim of a tort
allegedly committed by Tortfeasor. Insurance Co. is, by the
usual common-law rules of subrogation, entitled to sue
Tortfeasor just as Claimant could have. If Insurance Co. is
permitted to sue in the name of Claimant, and loses, it might
try to sue again in its own name. Since res judicata is often
determined, at least preliminarily, from the pleadings,
Tortfeasor might have difficulty showing that Insurance Co.
had already had its day in court, and lost. Therefore, Rule 17(a)
requires Insurance Co. to sue in its own name. See Advisory
notes to Rule 17(a).
4. Executors, administrators, bailees, and other types of persons
listed in Rule 17(a) are considered as being themselves "real
parties in interest," and do not need to bring suit in the name of
the person they represent. This makes explicit the fact that the
real party in interest need not have a beneficial interest in order
to sue so long as it has sufficient
interest in the outcome.
II. Fictitious Names under
Rule 10(a)
A. Rule 10(a) provides that an action shall contain the names of the
parties. Courts have carved out an exception to this rule in certain
types of cases involving particularly private matters, such as abortion
and homosexuality, to protect those people's identities. Furthermore,
plaintiffs that have previously been anonymous challenged the
constitutional, statutory and regulatory validity of governmental
activity,
not a private party (i.e., individual, business or corporation) whose
reputation could be damaged.
EX: In SMU Association of Women Law Students v. Wynne and Jaffe, various individuals brought an action under Title VII of the
1964 Civil Rights Act Against various law firms for alleged gender
bias. Several individual plaintiffs sued anonymously. Several
defendants moved to compel disclosure of their true names. The
trial court required disclosure since the plaintiffs' case challenged
a
private party and did not involve a particularly private matter.
NOTE: Sherman thinks the court's logic in SMU is dubious. He
thinks the women's case does involve a particularly private
matter,
and that they should probably be able to file suit anonymously.
III. Joinder of Claims under
Rule 18(a)
A. Rule 18(a) provides that "a party asserting a claim to relief as an
original claim, counterclaim, cross-claim, or third-party claim, may
join, either as independent or alternate claims, as many claims,
legal, equitable or maritime, as the party has against an opposing
party." In other words, once a party has made a claim against some
other party, he may then make any other claim he wishes against
that party. There are limitations to multi-party cases, as explained
below.
EX: P sues D, claiming that D intentionally assaulted and battered
him. Rule 18(a) allows P to join to this assault and battery claim
another claim that D owes P money on a contract entirely unrelated
to
the alleged tort.
1. Joinder of claims is never required by Rule 18(a), but is left at
the claimant's option. However, the rules of res judicata,
particularly the rule against splitting a cause of action, will
often as a practical matter induce
the claimant to join claims.
EX: P is involved in a car collision with D, and suffers both
personal injury damage to his car. If P were to sue only for the
bodily injury, the rule against splitting the cause of action might
result in his losing his claim for property damage, whether he
wins or loses the bodily injury suit.
2. While there are no restrictions on the number or nature of
claims that may be joined where a single plaintiff is suing a
single defendant, the rules on joinder of parties impose
limitations where there are several co-plaintiffs or co- defendants. Where there are multiple parties, at least one of
the claims by or against each party must arise out of "the
same transaction or series of transactions" and must
involve a "common question of law or fact" affecting each of
the parties joined.
EX: In Kedra v. City of Philadelphia, Kedra (P) and her children
filed a civil rights action against the City of Philadelphia (D),
stemming from an alleged series of incidents constituting
police brutality. The incidents involved various individuals
over a 15-month period. Several defendants moved to dismiss,
contending that the joinder had been improper due to the
expansive length of time involved. The court held that the fact
that certain claims and parties span a lengthy period of time will
not, in itself, prevent joinder. The court also held that the
various events over the 15-month period were part of an alleged
pattern and therefore a sufficient
relationship for joinder exists.
3. In its discretion, the trial court may remedy any possibility
of prejudice or inconvenience caused
by the joinder of claims by ordering separate trials. Rules 20(b) and
42(b).
IV. Permissive Joinder (may
be joined) of Parties under Rule 20 (Plaintiff’s measure)
A. Determining which parties are to be joined as plaintiffs or
defendants requires a consideration of the rules of permissive and
compulsory joinder. Compulsory joinder covers parties who
must be joined ("indispensable parties") and those who should be
joined if possible ("conditionally necessary parties"). The rules of
permissive joinder apply to parties who may be joined ("proper
parties").
B.
Under Rule 20(a), persons may join or be joined in one action if:
1. A right to relief is asserted by (or against) them jointly,
severally, or in the alternative
2. The right to relief arises out of the same transaction or series
of transactions; AND
3. There is at least one question of law or fact common to all
parties
sought to be joined.
C.
What these three different requirements mean is:
1. Relief sought:
a. Separate or joint: Each plaintiff is not required to have
in interest in every cause of action in all the relief prayed
for. If there are several Ps, they have the option to seek
separate relief or joint relief. Likewise, if several Ds are
joined, the relief sought may be against each separately
or against them jointly.
b. "In the alternative" -- plaintiff "in doubt": Sometimes,
a P may be in doubt as to which of several Ds is liable
for his injuries (i.e., P is injured by a bullet fired by either
D-1 or D-2). In such case, it is proper for P to set forth a
claim against each D in the alternative, so that their
respective liabilities can be determined.
2. "Same transaction" requirement: The requirement that the
right to relief arise from the "same transaction or series of
transactions" is construed very broadly. Some causal
relationship or interrelation among defendants' conduct, or
in the interest being asserted by multiple Ps, is sufficient. This
tends to merge with the "common question" requirement,
below.
3. "Common question" requirement: It is sufficient if there is a
single question of law or fact common to all parties joined.
However, it is not necessary that the "common question" be
in dispute.
EX:
P-1, a driver, and P-2, a passenger in the car, sue D for injuries sustained
in an auto accident. The “common question” was whether D was
negligent. This is sufficient for joinder purposes, even though
there are also many separate questions involved (i.e., injuries sustained
by each, any contributory negligence barring P-1’s claim, etc.)
D. Additional unrelated claims: As long as the requirements for
joinder
of parties (above) are met, each of the parties joined may assert
as many claims as he has against any opposing party. Rule 18.
The policy of the law is to allow unlimited joinder of claims
as long as there is a transactional connection among all of the
parties.
EX: P joins D-1 against whom he claims injuries while a passenger in
D-2's vehicle, and D-2 against whom he claims for the same injuries
in the accident, and also for failure to pay a promissory note that
D-2
executed in favor of P. This joinder is proper.
E. To curb expense, delay or other prejudice that might result from the
joinder of numerous parties asserting numerous separate claims
against one another, the court may order separate trials for various
claims joined, or otherwise regulate the proceedings to minimize
the
difficulties involved. Rule 20(b)
NOTE: Unlike compulsory joinder of parties under Rule 19 -- which is for
both plaintiffs and defendants -- permissive joinder of parties is a plaintiff’s measure. The reason for this is that the plaintiff, not the defendant, should be able to choose what parties are inolved in a suit if those parties are not necessary to
the
suit.
V. Compulsory Joinder of
Parties under Rule 19
A. Joinder is required for any person who has a material interest in the
case and whose absence would result in substantial prejudice to the
absentee
or to other parties before the court. Rule 19.
B. Person to be joined if feasible: Rule 19(a) provides that any person
with an interest in the subject of a pending action shall be joined as
a
party if:
1. In his absence, complete relief cannot be accorded those
already parties (Rule 19(a)(1));
OR
2. His interest is such that to proceed without him would be
substantially prejudicial
as a practical matter because it would:
a. Impair his ability to protect his interest in later
proceedings. Rule 19(a)(2)(i); OR
b. Expose the parties already before the court to the risk
of double liability or inconsistent
obligations. Rule 19(a)(2)(i).
Situations in which compulsory
issues commonly arise:
EX: Tortfeasors: Although the plaintiff may join in one action
all defendants potentially liable to him as a result of a given
transaction or occurrence, ordinarily he is not required to do so,
and a joint tortfeasor is not considered a necessary party. Often,
there is a right of contribution among joint tortfeasors. Where
this is so, those defendants who are sued can file third-party
complaints or cross-complaints (depending on the jurisdiction)
against the other torfeasors for indemnity (this is called an
impleader, and is explained
below).
EX: Partial assignees or subrogees: In an action by a partial
assignee or subrogee to enforce its share of a debt, all other
partial owners are necessary parties who should be joined if
feasible. This was one of the central issues of Janney
Montgomery Scott, Inc. v. Shepard Niles, Inc.
NOTE: Sherman often uses the terms "necessary" and "indispensable"
to refer to the parties. He urges us to avoid such intellectual laziness
and follow the recent amendment of Rule 19, which refers to parties as
"feasible"
and "non-feasible."
C. Effect of nonjoinder--possible dismissal: If a person to be joined
cannot be made a party (i.e., because he is not subject to the court's
jurisdiction), the court must determine whether "in equity and in
good conscience" the action can proceed without him or whether the
action should be dismissed. The court's determination is based on the
following
practical considerations (Rule 19(b)):
1. The extent to which any judgment rendered in the action
would be prejudicial to the interest of the absent party, or the
interests of those already before the
court;
2. The extent to which such prejudice could be lessened or
avoided by appropriate court
action;
3. Whether relief rendered without the absent party would be
adequate; AND
4. Whether the plaintiff has any other adequate remedy if the
action is dismissed for nonjoinder
of the absent party.
D.
There are procedures for compelling a joinder:
1. In the complaint, plaintiff should set forth the names of all
necessary persons who have not been joined, and the reasons
for the nonjoinder. Rule 19(c).
NOTE: This provision is not really effective because Ps rarely
concede that nonparties are necessary
parties.
2. If the plaintiff has failed to join necessary parties, the court
will order that they be joined unless it is impossible to do so
because their joinder would destroy subject matter jurisdiction
or because the court lacks personal
jurisdiction over them.
a. Involuntary plaintiff: If the absentee should be aligned
as a plaintiff, he may be joined as an involuntary plaintiff.
Rule 19(a)
b. Necessary parties too numerous: Where the necessary
parties are too numerous to be joined, it is possible that
the case might be handled as a class
action.
c. If addition of the necessary party would make venue
improper, the added party must be dismissed if he objects
to venue. Then the court must decide
whether to dismiss.
3. Where the court cannot order the necessary parties
joined because of lack of personal jurisdiction or because their
presence would destroy diversity of citizenship (as the defense
argued in Janney), then the court must decide whether to
dismiss the action.
VI. Impleader under Rule
14
A. Third-party defendant: Under Rule 14(a), a defendant alleging that a third person is liable to him “for all or part of the plaintiff’s claims against him” may “implead such a person as a ‘third-party defendant.” Sherman says the test of
Rule 14(a) is whether third-party defendant is liable or not to defendant.
The typical fact pattern in which federal courts have permitted impleader
is where one event gives rise to double liability, defendant to plaintiff and
third-party
defendant to third-party plaintiff.
Under impleader, the defendant is called a “third-party plaintiff,”
and the third-party defendant is, naturally, the “third-party defendant.”
EX: An employer who is sued on the theory of vicarious liability wishes to
recover from his allegedly negligent employee on an indemnity theory. Rather
than wait for a judgment against himself, and then bring a separate action against
the employee, the employer may choose to bring the employee into the original
action. The employer is called a “third-party plaintiff,” and the employee is a
“third
party defendant.”
EX: In Cappellini v. Unification of World Christianity, P sued a “deprogrammer”
who had been hired by P’s parents to hold P against his will for five weeks and
make him give up his association with the Unification Church. He alleged D
violated his constitutional rights. D filed a third-party complaint seeking
compensatory and punitive damages against the Church, its President, and its
attorney. The proposed third-party complaint in this action, though related to
the original action, does not bear an adequate causal connection to the main
action to warrant impleader. P’s claims arose out of the events from 1977 to
1978, when D tried to persuade P to abandon membership to the Church.
D’s claims, on the other hand, arose out of the filing of P’s lawsuit and the
events that occurred afterward--the signing of the contract between P and
the church, and the alleged harassment and injuries to the third-party plaintiff
as an individual. The court found that if the church were liable to D on these
claims it would not be as a direct result of the determination of the main claim.
These
third-party claims are independent.
B. Claim must not be derivative: For a third-party claim to be valid, the third
party P may not claim that third-party D is the only one liable to P, and he
himself is not liable at all. The third-party P’s theory must be one that has the
third-party P’s liability as a prerequisite for throwing liability on the third-
party D. Thus, impleader is confined to those situations in which the
defending party has a right to indemnity, in whole or in part, against the
impleader third party (i.e., where D asserts that if he is held liable to P, he
would
be entitled to collect all or some part of the judgment from third part
D).
NOTE: Sherman points out that impleader does not require same transaction
or occurrence. It deals with derivative liability -- third party D is liable to
third
party P.
1. The third-party P is not precluded from claiming in an alternative
pleading
that neither he nor the third-party D is liable.
C. Impleader by Plaintiff: Just as D may implead a third-party D, so a P
against whom a counterclaim is filed may implead a third person who is liable to
him
for the counterclaim. Rule 14(b).
D. Leave of court is not needed if D serves a third-complaint and summons
upon the third-party D within 10 days of the time the original D served his
answer to P’s claim. After this 10 day period, the court’s permission to plead
is
necessary.
E. If the main claim is dismissed before or during trial, the court still has
the authority to hear the third-party claim based on it. Whether to exercise
this
authority is left to the court’s discretion.
VII. Interpleader under
Rule 22 and 28U.S.C.A. 1335
A. Interpleader is a technique whereby a party (called the “stakeholder”)
who
owes something to one or two more persons (called the “claimants”),
but isn’t sure which, may force them to argue out their claims among
themselves before coming to sue him. It is designed to prevent the
party from being made to pay the same claim twice.
EX: X and Y both claim a bank account at Bank Two. Y alleges that is was
assigned to him by X; X denies the assignment, claiming that a document Y
offers as evidence was a forgery. Y demands the money from the bank. Bank
Two interpleads to have X and Y argue out their claims among themselves.
If the bank did not have this remedy of interpleading, it could not avoid the
possibility
of having to pay X and Y.
NOTE:
It is common for insurance companies to try to interplead.
B.
In federal practice, there are two distinct interpleader actions:
1. Statutory interpleader: Interpleader is permitted by 28 U.S.C.
section 1335, which contains special provisions as to jurisdiction, venue,
and service of process, if:
a. Two or more claimants (defendants) of diverse citizenship
are making adverse claims to the same
property owed or held by the plaintiff; AND
b. The value of the property is
more than $500.
c. Service of process can be made
anywhere in the U.S.
d. Venue is residence of one or more
claimants
2. FRCP interpleader: Interpleader
is permitted under Rule 22 if:
a. Stakeholder cannot have the same citizenship as any of
the claimants
(this is diversity of citizenship) AND
b. The value of the property is
more than $50,000.
c. Service of process is limited to personal or individual
service (Rule 4). This means that the summons has to be
served at the residence of the claimant(s). Long-arm
statutes will allow claimant(s) in
different states to be served.
d. Venue is the residence of all claimants, or where the
events occurred or where property is
located.
C. Other suits restrained under 28 U.S.C.: To further the goal of
protecting the stakeholder from double liability, 28 U.S.C. 2361 allows a
court hearing a section 1335 action to enjoin (prohibit) all claimants from
starting or continuing any other action, in any state or federal court, which
would
affect the property.
EX: Insurance Co. is sued in state court by the son of a recently deceased policy-
holder; the son asserts that he is entitled to the policy’s proceeds. The widow
of the policy holder also files a claim, in federal court. Insurance Co. may bring
an interpleader action in the federal court of the district in which either the
son or the widow resides, as long as the two are citizens of different states. The
federal judge will then enjoin both the son’s suit and widow’s suit, and decide
the
matter himself.
D. Cross-claims and counterclaims: The interpleaded claimants may (and
usually do) cross-claim against each other, counterclaim against the plaintiff,
and
implead third parties, unless jurisdictional problems prevent their
doing so.
a. Subject matter jurisdiction: Such additional claims must have an
independent basis of jurisdiction unless they relate to the original
impleaded claim (and thus fall within
supplemental jurisdiction).
VIII. Intervention under
Rule 24
A. Intervention generally: Rule 24 allows certain persons who are not
initially part of the lawsuit to enter the suit on their own inititiative. Such an
entry is called “intervention,” and the person who intervenes is called an
“intervenor.”
1. Rule 24 recognizes two types of
intervention:
a. “Intervention of right” (Rule 24(a)) does not require
leave of court for entry into case.
b. “Permissive intervention” (Rule 24(b)) is left to the
court’s discretion.
B. Who may intervene as a matter of right: A stranger to an existing action
has an automatic right of intervention, under Rule 24(a), if he meets all of the
following
criteria:
1. Interest in subject matter: The Supreme Court has said that a “significantly protectible interest” suffices to support intervention of
right. Some lower courts emphasize that a direct, substantial and legally
protectible interest to satisfy the standard, while others take a more
relaxed standard.
EX: Rate-payers of a utility could not intervene in a contract action
between the utility and a supplier concerning the amounts the utility
would have to pay for boiler fuel. Although the outcome of the litigation
could affect the rates intervenors would have to pay, they had no
legally protectible interest in the contract dispute. New Orleans Public
Service Inc. v. United Gas Pipe
Line Co.
2. Impaired interest: The intervenor must also show that the
resolution of the litigation would impair his interest. What is examined
is the practical impact of resolution of the litigation on the intervenor’s
interest.
EX: In an action challenging issuance of licenses to operate uranium mills
without environmental impact statements, intervenors with applications
pending would be affected, as a practical matter, by the litigation’s
outcome if it caused defendant’s agency to alter its mode of operation and
require more of applicants for licenses. Natural Resources Defense
Council v. U.S. Regulatory Commission
3. Inadequate representation: Where the intervenor claims the right
kind of interest and shows a threat of practical impairment, intervention
could be denied on the ground that the intervenor’s interest is
adequately represented by the present parties. Many factors can be
taken into consideration, including the ability and resources of the
present parties to litigate effectively, and the existence of any conflicts
of interest between the present party
and the intervenors.
C. Rule 24(a)(1) states that intervention is granted as a matter of right where a
federal statute confers an unconditional right to intervene (i.e., 28 U.S.C.
2403, which allows federal intervention of rights in actions involving the
constitutionality
of an act of Congress).
D. Compare--intervention of right with compulsory joinder: The criteria
which allow a person to intervene as of right are the same as those which require
that he be “joined if feasible” under Rule 19(a)(2)(i). As the Advisory
Committee’s Notes to Rule 24(a) put it, “where, upon motion of a party in an
action, an absentee should be joined so that he may protect his interest which as
a practical matter may be substantially impaired by the disposition of the action,
he
ought to have a right to intervene in the action on his own motion.”
E: Permissive intervention: The court has discretion to permit a nonparty
to
intervene if:
1. A federal statute
confers a conditional right to intervene; OR
2. A question of law or fact in common with the main action is part of
the applicant’s claim or defense. For example, in a suit to set aside a
zoning ordinance, property owners may intervene if their claims present
common questions of law or fact. The court has a great deal of
latitude in granting or denying
a permissive joinder.
IX. Class Actions under
Rule 23
A. One or more members of a class of persons similarly situated may sue or
be sued on behalf of all members of that class. Such lawsuits are permitted
where considerations of necessity or convenience justify an action on
behalf of the group rather than multiple actions by (or against) the class
members
individually.
B Rule 23 provides that members of a class can sue or be sued with binding
effect
on the class as a whole.
C. Prerequisites to Class Action: Under Rule 23(a), all four of the following
conditions
must be established in any type of class suit.
1. Numerous parties: The class must be so numerous that joinder of
all members individually is impractical
(Rule 23(a)(1));
2. Common question: The actions must involve at least one question
of law or fact common to the class
(Rule 23(a)(2));
3. Representative’s claims typical: The claims (or defenses) of the
persons maintaining the action on behalf of the class must be
typical of those of the class generally
(Rule 23(a)(3); AND
4. Adequacy of representation: The persons representing the class
must be able fairly and adequately to protect the interests of all
members of the class. Rule 23(a)(4)
D. No fixed minimum: There is no fixed minimum number required to make
a class “too numerous” for joinder of all member individually. Some cases have
held 25 enough, while others have held that 39 is not enough. Usually, permitting
a
class depends on a number of different factors:
1. The size of each member’s claim (the smaller the claim, the more
likely a class suit will be allowed);
2. The practical likelihood that individual suits will be brought
(the lower the likelihood, the more
likely a class suit be allowed); AND
3. The public importance of the right being enforced (the greater the
public importance, the more likely
a class action will be permitted);
E.
Common question requirement: There must be at least one “question
of law or fact common to the class.”
F. Typical claim requirement: The claims of the representatives suing on
behalf
of the class must be typical of the class generally.
EX: A Mexican-American employee who challenged the denial of a promotion
was not typical of a class of Mexican-American job applicants who had not been
hired, even though he alleged that the job application had, like him, allegedly
been discriminated against on grounds of national origin. His claim of denial
of a promotion in a specific instance was not typical of the claims of other
Mexican
job applicants who were never hired.
G. Adequate representation requirement: The requirement that the
representatives “fair and adequately protect the interests of the class”
has often been seized upon by the defendant in a plaintiff class action to show
why the class action should not be allowed. The class representatives must no have any conflict of interest with the absent class members, and they must further
competent legal counsel
to fight the suit.
H. If the above four elements are met, the most common basis for a class suit
is under Rule 23(b)(3)--the situation in which questions of law or fact common
to the class predominate over questions affecting only individual members, and,
on balance, a class action is superior to other available methods, for
adjudicating
the controversy.
1. In deciding whether common issues “predominate” and whether a
class action is “superior” to individual
litigation, the court must consider:
a. The interest of individual members in personally
controlling their cases;
b. The nature and extent of any litigation in progress
involving the same controversy;
c. The desirability of consolidating all claims in a single action
before a single court; AND
d. Any probable difficulties
managing a class action.
I. Defendant Class Actions: Rule 23 states that suits may be brought against
a defendant class. For such actions, the Rule does not provide any procedures
different
from those for actions on behalf of a plaintiff class.
Obtaining
Information for Trial
I. Discovery in general
A.
Discovery under the FRCP takes several forms:
1. Automatic disclosure, in which each party
must disclose in writing the names of occurrence
witnesses, facts about documents, etc., early on in
the litigation without a request from the other
side. Only about 50% of jurisdictions have adopted
automatic disclosure.
NOTE: Scalia says that
mandatory discovery puts a lawyer in the awkward position of helping
the other side more than assisting his own client. Also, he says
that what is “relevant” to “disputed facts” will produce massive
litigation.
2. Depositions, taken from both written and
oral questions (this is probably the most important
part of discovery)
3. Interrogatories addressed
to a party
4. Requests to inspect documents or property
(second most important part of discovery)
5. Requests for admission
of facts
6. Requests for physical or mental
examination
B.
Non-privileged relevant material:
Any relevant material which is non- privileged may be discovered.
C.
Objectives of discovery:
a. Narrow and clarify the basic issues between
the parties AND
b. Ascertain the facts
relative to those issues.
NOTE: Courts generally will not allow discovery for the
purpose of determining whether or not there is a factual
basis
for a cause of action not yet made.
D. General scheme: Determining whether material falls
within the scope of discovery can be accomplished by
addressing
the following seven questions:
1. Is the material subject to "Initial Disclosure"
provisions of 26(a)(1) or the "Pretrial Disclosure"
provisions of 26(a)(3) (remember only 50% of
jurisdiction adopt mandatory discovery)?
"Yes"--automatically discoverable,
regardless of questions below.
"No"--go to step 2.
NOTE: Scalia says that
mandatory discovery puts a lawyer in the awkward position of helping
the other side more than assisting his own client. Also, he says
that what is “relevant” to “disputed facts” will produce massive
litigation.
2. Is the material relevant to the subject matter in
the pending action?
"No"--discovery will not
be allowed.
"Yes"--go to step 3.
3. Will the material be admissible
at trial?
"No"--discovery will not be allowed unless
the information appears reasonably calculated to
lead to the discovery of admissible evidence. If
it is calculated to lead, go to step
4.
"Yes"--go to step 4
4. Is the information sought
privileged?
"No"--go to step 5
"Yes"--if it is privileged, it is not discoverable,
unless the privilege is waived.
5. Is the information outside of the work product
immunity?
"No"--Discovery is allowed only if there is a showing of
substantial need of the material, and an inability to
acquire it by other means without undue hardship.
If this showing can be made, go to step 6. Examples of
this include: other attorney has a deposition of a
witness that has died.
"Yes"--go to step 6
6. Is the material composed of facts and/or opinions
held by experts?
"No"--go to 7
"Yes"--It may or may not
be discoverable. See Rule 26(b)(4)
7. If the material sought for the purpose of discovering
whether the other party has evidence to impeach the
discovering party's credibility (i.e. a witness whose
sole goal is to impeach credibility)?
"No"--then material is probably
discoverable
"Yes"--It may or may not be discoverable. Rule 26(a)(3)
suggests not--names to not have to automatically be
provided for evidence that is expected to be "solely
for impeachment purposes."
D.
Discovery Scope and Limits (Rule 26(b))
1. Rule 26(b)(1): Rule 26(b)(1), which applies to all forms of discovery, provides that the parties may obtain discovery regarding any matter that is relevant to the subject matter involved in the pending action. This "relevance requirement" is very lenient--it is sufficient that the material is relevant to the subject matter of the action, and not to the precise issues which will arise at trial. This matter must not be privileged (i.e. attorney- client privilege). But Judge Brazil states that accessing this material involves common sense and good faith, not using discovery for ulterior
motives or for totally ineffective
and inefficient reasons. Convergent
Technologies Securities Litigation
2. Rule 26(b)(2):
Rule 26(b)(2) is very important, according to Sherman, since it limits
discovery. One major purpose is to limit wealthier parties
from bullying or over-burdening less wealthy parties during the
discovery process. The court must
limit discovery if it finds one of the following circumstances to exist:
a. Discovery unreasonably cumulative:
If discovery is obtainable from some other
source that is more convenient, less burdensome,
or less expensive, the court may limit or forbid
discovery (but court must be careful of letting
a party freeload and get information at the
other party's expense).
b. Party has already had the opportunity
for discovery: If the party seeking discovery
has already had ample opportunity in the action
to obtain discovery of the information sought,
the court may limit or forbid discovery.
c. Discovery unduly burdensome: If discovery
is unduly burdensome or expensive in view of the
needs of the case, the amount in controversy, the
limitation on the parties' resources, and the
importance of the issues at stake in litigation, the
court may limit or forbid the discovery. This
is essentially a proportionality test that
requires considering cost-benefit
principles.
EX: There is a $500 case, and it would cost $10,000 for discovery. The judge could use 26(b)(2) to limit
discovery.
NOTE: Rule 1 is in accord with Rule 26(b)(2),
since it states that the purpose of FRCP is "to
secure the just, speedy, and inexpensive
determination of every action.
E. Sanctions (Rule 37): Applied if there is an abuse
of discovery, such as when discovery is used to harass or
club
an opponent into settlement.
II. Discovery Devices
A. General characteristics: The various forms of
discovery (including depositions, interrogatories, and
document requests) are set out in Rules 30, 31, 33, 34,
and 36. With the exception of Rule 35--requests for a
physical or mental examination--each of these forms shares
several
characteristics:
1. These modes of discovery operate extrajudicially,
without the intervention of the court. It is only when
one side refuses to comply with the other's discovery
request that the court intervenes.
2. The material sought to be discovered must be
relevant to the subject matter of the lawsuit,
and unprivileged.
3. Every request for discovery of any type, and any
response or objection to discovery, must be signed
by the lawyer preparing it. (Rule 26(g))
4. Rules 26(g)(3) and 37 can
be used for sanctions (depending on the discovery violation).
B.
Planning for discovery (Rule 26(f))
1. At least 14 days before a scheduling conference with the judge occurs under Rule 16(b), there must be a meeting between the parties to discuss their claims, defenses, and possibility of prompt settlement of their case, and to develop a proposed discovery plan. The discovery plan will be submitted to the court meeting under Rule 16. No formal discovery can take place until counsel meets under Rule 26(f) (unless a
witness is about to leave the country).
C.
Document Inspection (Rule 34)
1. Materials discoverable:
A party is entitled to inspect and copy
a variety of items in the possession of the other party, including documents,
photographs, maps, records (however kept), and correspondence.
Information stored on computers can also be inspected.
2. Designation of items: The moving party must
describe the items to be produced with sufficient
certainty.
a. Category (most common):
Most often, a party will request all material that falls within a category
(i.e., "all documents that relate to the meeting on January 4,
1994") rather than specifying individual items.
NOTE: Rule 26(a)(1)(B) calls for parties to
automatically disclose pertinent documents, or
provide a listing of them by category, before
formal discovery begins. Thus, these documents may
not need to be formally discovered.
3. Writing/interpreting discovery
requests: The producing party will interpret discovery requests
as narrowly as possible.
The moving party will draft discovery requests as broadly as
possible.
4. "Control" and "Influence"
of documents: A party must produce all requested items that are
within its possession, custody, or control. The "control"
idea can be extended to making the party obtain documents
from others if it has "influence" over the possessor (i.e.,
docs in possession of D's British affiliate were in D's custody or control
for purposes of discovery).
5. Organization: The responding party must produce
documents as they are kept by the producing party,
or grouped according to the specifications of the
request.
6. Difficulty of obtaining docs not an excuse: The responding party cannot avoid producing documents by claiming "impossibility" or "great difficulty" if it can obtain information from sources under its control. This generally requires a good faith effort. Also, the burden should not be on the moving party to go on a gigantic treasure hunt to find the documents in the possession of the producing party, since the producing party is generally more familiar with their
organizational systems.
EX: Fact that a record search
of 2.8 million invoices would requires a great deal of time and money
is not sufficient to avoid doc production (of course, the proportionality
test of 26(b)(2) would apply here).
EX: Fact that Sears had a poor
indexing system and it would be a "Herculean effort" to locate
requested docs is not an excuse not to produce docs or put burden on
moving party to locate docs.
D.
Non-party production (Rule 45)
1. Non-party production:
Rule 45 authorizes a subpoena to produce designated documents in its
control or permit inspection of premises. But "reasonable
steps" should be taken to "avoid imposing undue burden or
expense" on that non-party.
E.
Interrogatories (Rules 33)
1. Interrogatories are written questions from one
party to another party requiring written responses
under oath.
a. Interrogs v. Depositions:
(i) Interrogs
may be addressed only to a party
to the action, while depos can be taken from a party or nonparty
witness.
(ii) Interrogs are prepared in writing, usually by counsel for the answering party.
Depo questions may be oral or written, but
the answers are always given orally
before the court and are transcribed.
(iii) Interrogs require the
party to answer not only of his own knowledge, but also on the
basis of information to which she has reasonable access.
But a deponent may limit his answers to only matters of which she has
personal knowledge.
2. Who must answer:
a. A non-party witness is not subject to interrogs. But oral or written depos are available (which of these two depos are
available depends on how far
the witness lives).
b. Interrogatories served on a corporation
may be answered by any officer or agent
designated by the corporation.
(Rule 33(a))
3. Limiting interrogs:
A party, under Rule 33(a), is limited to 25
interrogs absent stipulation or court order.
4. Use of interrogs: Interrogs are very helpful
for identifying witnesses and discovering
the location of documents and other tangible
items, although 26(a)(1) may mandate disclosure of
many of these things.
5. What is and is not appropriate
in interrogs:
a. Appropriate: to ask what the other
side's position is, what their opinion is,
even what their opinion is about the
application of law to fact. These are
known as contention interrogs.
Rule 33(c)
b. Innapropriate: Getting into the
details of the other side's strategy. This
is known as "work product."
6. Extensive search required:
Since an answering party must give all info under his conrol in response
to an interrog, he might have to conult his own files or employees.
This requires a "good faith" effort. If the answer
can only be supplied by an extensive search of docs, then it is sufficient
to specify the pertinent records
and allow the inquiring party to examine and copy them.
Rule 33(d)
EX: P sought detailed statistical info from D in an
employment discrimination suit. D objected, invoking
Rule 33(d). P responded that D could find info easier
than P could. Held: Rule 33(d)'s applicability depends
not on familiarity but with the difficulty of analyzing
thos records to derive the info. for P's request. P is
just as capable as D of finding docs, and a kowledgeable
employee shall help P locate those
docs.
NOTE: Unlike Rule 34 (Sears
case), Rule 33(d) allows the burden to
be shifted onto the moving party.
6. Objections: Objections during interrogs are
later ruled on by the court. Rule
36(a)--3rd para
E.
Depositions (Rules 30, 31, and 45)
1. Depositions: A deposition is the examination of a witness under oath in the presence of a court reporter. Counsel can examine and cross-examine the witness. If the witness is recalcitrant, the
examination may be held in front of
a judge.
2. Form of notice:
A party wishing to depose a witness must give reasonable notice
in writing, not a subpoena, to the party (deponent)
and every other party, identifying the deponent, and time and
place of depo. Rule 30(b)
a. Non-parties: Non-party witnesses must be told to attend by means of a subpoena under Rule 45(a). Under Rule 45, the moving party must pay non-party. Moving party may also end up
antagonizing non-moving party.
3. Production of documents: A subpoena or notice
may direct the witness to bring along and produce at
deposition any docs that could properly be sought by
a request for production (this can be very efficient,
since it allows the moving party to go through the
whole process of requesting documents).
Rule 30(b)(5)
4. Place of depo: Depo must take place within 100
miles of the place where he resides, is employed, or
transacts business. Rule 45(c).
5. Numerical cap on depos:
A 10-deposition limit is not per party, but
cumulative (for Ps, Ds, and third-party Ds). A witness' depo
can be taken only once. (Rule 30(a)(2)(A))
6. Advantages and disadvantages of depos:
They are very expensive, but an important part
of discovery (2/3 of discovery consists of depos)--
they are the workhorse of discovery. The advantage
of depos is that they are spontaneous--witnesses
cannot prepare their answers in
advance.
7. Oral (Rule 30) v. Written
(Rule 31) depos
a. Oral (Rule 30): A party may take the oral
testimony of any person (party or non-party)
thought to have information within the scope of
discovery, by asking oral questions. This is
more expensive than written depos, but it
allows the examiner to follow up answers
effectively and does not allow deponent to
sit and think about their answers.
b. Written (Rule 31): An examining party can
submit its answers in writing. This may be
less expensive than oral depos, but it does not
allow for follow up answers. The written
depo is a midway point between
the prepared answers of interrogs and high cost of spontaneous depos.
Written depos are much less common
than oral ones.
(i) Two main purposes--deposing distant non-party witnesses and low cost: Deposing distant non-party witnesses who cannot be served with interrogs (since these apply only to parties) and saves the expenses of
making a trip to interview that witness.
8. Objections: Objections during interrogs are
later ruled on by the court.
Rule 36(a)--3rd para
F.
Physical or mental examination (Rule 35)
1. When the physical or mental condition of a party
(not a non-party) or of a person in the custody or under
legal control of a party is in controversy, the court
may order the party to submit a physical or mental
examination only if good cause is shown. Notice
must be given to the person examined and to all other
parties.
a. Good cause means that the exam sought must
be shown to be reasonably likely to produce
information
about the condition in issue.
2. Rule 35 v. other discovery
devices: There are two important
differences between Rule 35 and other discovery devices discussed
previously:
a. Motion required: Unlike the other discovery
devices, Rule 35 does not operate extrajudicially. The discovering party must
make a motion showing good cause.
b. Controversy: Mental or physical condition
must be related to an actual issue in controversy that is raised directly in pleadings or in the factual contentions of parties through discovery (this is a stricter standard than other discovery devices, where
the material simply has to be relevant to the
subject matter
in the pending action).
EX: P sued D for defamation, alleging that D's letter to
potential employers stating that P was a bad
employee caused her mental anguish. D issued a motion
for the mental examination of P, but
P objected. Ct. upheld a mental examination, holding that that P's claims
and her desired compensation went directly to the issue of mental anguish.
NOTE: Many cases, such as those involving sexual
harassment, fall into the gray area of whether or not a
mental exam should be ordered.
3. Counsel cannot attend the
exam.
G.
Sanctions for discovery
1. General sanctions: Several types of orders and
sanctions are available to parties
to enforce the discovery process.
2. Abuse of discovery: A party may use discovery
to harass or bully his adversaries, such as requesting
that discoveree reveal trade secrets. There are two
ways discoveree can react:
a. He can object to that particular request.
The usual ground for such an objection is that the
request does not fall under the scope of
discovery under Rule 26(b)(1), or that it is
priveleged (i.e., attorney-client
privelege). OR
b. He can seek a protective order under Rule 26(c). A proptective order may be issued to prohibit an entire line of questioning, the use of
a particular form of discovery, or the examination
of a particular witness. Rule 26(c) lists the eight
different kinds of protective orders.
3. Compelling discovery: Under Rule 37(a), a party
seeking discovery may seek an order compelling discovery. Such an order is sought when the discoveree refuses to divulge the requested
information. Rule 37(a) applies to when the discoveree
fails to answer, or provides
an evasive or incomplete answer, and so on.
4. Sanctions: Rule 37(b) provides for a number of
sanctions, such as attorney's fees or contempt of court,
depending on how serious the lack of
compliance is.
H.
Admissibility at trial
1. Use of results generally: Once a party has
obtained discovery through trial, he may wish to
put that information into evidence at the trial.
Whether or not this info is admissible is set out
in the various rules.
2. Requested documents under Rule 34 are
generally admissible, as long as they are
authenticated as to their genuineness.
ASK SHERMAN TO CONFIRM THIS.
3. Depositions (Rule 32(a)): Admissibility of depos depends on whether the depos would fall under the
exceptions listed or whether they would
be hearsay.
a. Generally inadmissibe: Statements in depos
are hearsay and thus are generally
inadmissible.
EX: Deponent stated, "X told me that D went through
the red light." This statement would probably not
be allowed on P's behalf at the actual civil trial because of the hearsay rule. Thus, since the
statement could not be made at trial, the
deposition likewise would not be admissible
at rial.
b. Exceptions: However, if the statements fall
under the following circumstances then they may
be admissible.
(1) Party admissions: The depo of an
adverse party, or of a director or officer
of an adverse corporate party, may be
admitted for any purpose at all
(2) Impeachment: The depo of any
witness, whether he is a party of non-party,
may be used to impeach the witness'
credibility on the stand.
EX: W testifies at trial that he saw X run the
light and kill his friend Y. In his depo, W
admits to having once falsified a job
application. Even though W is not a party to the suit, his deposition
testimony can be used to impeach his credibility.
(3) Unavailability of deponent: If
deponent is dead, more than 100 miles from
the trial, too ill, or there are "exceptional
circumstances," then the deposition of any
of that deponent can be used for any purpose,
including at trial.
(4) Exceptional circumstances: If there
are "exceptional circumstances" and in the
interest of justice, a depo can be
used at trial.
NOTE: A party cannot introduce a depo to buttress
he own case or to bolster witness'
credibility.
EX: D is testifying. His manager, X, is in the
courtroom. P wants to put X's depo into
evidence to impeach D. Under 32(a)(2), a party's
manager's depo can be used, even though that
manager is sitting in the courtroom.
EX: P took depo of an engineer, who is not a party
to the lawsuit. The engineer lives in the same
city. Can the engineer's testimony be used? If
it is to impeach a witness, it can be used under
32(a)(1). But if not, then it can only be used under
"exceptional circumstances" as required by Rule
32(3)(E).
4. Interrogatories (Rule 33(c)):
The interrogatory answer of a party can be used by an adverse
party for any purpose, including substantive as well as impeaching
purposes.
a. Not binding: Statements made in depos and
interrogs are not irrefutably binding on the
maker, and he can contradict
them in court.
5. Physical and mental exams (Rule 35): The
results are almost always admissible
at trial.
J.
Request for admission (Rule 36)
1. Acknowledge issues: A request for admission may
be served by any part on any other
party, whether adverse or not. Such a request imposes a duty
on the party to acknowledge the existence of facts
that are not in doubt and that should not be necessary to prove
at trial.
2. Subject of request: A party can request that the
other party admit the genuineness of a document,
admit an opinion
(i.e., extent of damages), and so on.
3. Requests and responses:
A request can be served any time after the 26(f) conference and must
be responded to within 30 days.
a. If there is no response to the request, then
the matter is deemed admitted. Sherman
says this is one strategy available to get the
other party to admit things.
K.
Duty to supplement responses (Rule 26(e))
1. Supplementing disclosure: If party makes a
disclosure that is accurate but later learns it is no
longer accurate, or the party is honestly mistaken
about some fact at the time of disclosure and later
learns of his mistake, then that party has a duty
to amend or supplement his disclosure. This
duty to supplement includes interrogs, document
requests, requests for admission, expert
opinion (if it changes), and any automatic
disclosures under 26(a). Rule
26(e)(1) and (e)(2)
ASK SHERMAN TO DEFINE PARTY
L.
Discovery sequence and tactics
1. Streamlining complaint: A carefully drafted
complaint can narrow the issues and streamline the
discovery process. It should make clear as to what
the acknowledged facts are.
2. After pleading stage: After the pleading stage,
many lawyers launch into interrogs, followed by doc
requests based on interrogs, followed by depos. But
an alternative approach is to use depos to
accelerate discovery since they get a case moving
better than any other discovery device. See rules 27
and 30(a) for time requirements. See
Sherman p. 329
III. Managing the Scope
and Burden of Discovery
A.
Exemptions from discovery
1. Privelege (Rule 26(b(1)): Rule 26(b)(1) allows
discovery of any matter that is not priveleged.
Examples of privelege would be an attorney-client
privelege, doctor-patient privelege, and whatever
other priveleges are protected under
the state law of the applicable state.
a. Attorney-client privelege: Protects
only legal advice between an attorney and his
client.
b. Corporate client privelege: Many courts previously limited the privelege to communications between lawyers and the "control group" of the corporation--the employees who were high up and
controlled the corporation, and could act on
attorney's advice. But the problem with this
"control group" test is that it did not allow
the high up employees to investigate middle
and lower eschelon employees about a certain
issue (i.e., Union Carbide polluting the Amazon),
since there is no attorney-client privelege.
It created a zone of silence.
(1) "Control group" test rejected: But in Upjohn v. U.S., the Sup Ct rejected the "control group" test and adopted a test that can extend the privelege all levels of employees. This privelege--or confidential
relationship--would allow a corporation to
better prepare for litigation. The
corporate client privelege is really an
extension of the attorney-client
privelege in that it protects all
eschelons of corporate employees.
2. "Work-product" immunity (Rule 26(b)(3) and
(b)(4)): Certain immunity from discovery is given to the materials prepared by counsel fo trial purposes (26)(b)(3), and to the opinions of experts 26 (b)(4) that counsel has consulted in trial preparation. This immunity is referred to as "work-product" immunity, and applies to all
preparation for trial done by the
lawyer or any representative of the
party unless the discovering party can show substantial need
and an inability to obtain equivalent material
without undue hardship.
(a) Prepared for trial purposes
means that materials being sought
were prepared for litigation, and for
materials not to fall under this immunity,
there must have been no foreseeable possibility of litigation.
Rationale: Without this rule, there could be a problem of
attorneys getting a free ride, and using opposing
counsel's (or his expert's) notes, investigations, etc., gratis.
a. Qualified v. absolute:
(1) Absolute immunity: Documents
containing the subjective thoughts
(i.e., legal theories, opinions, mental
impressions) of a party's lawyer or
other representative are given absolute
immunity, which is impossible to
overcome. Rule 26(b)(3).
Caveat: Sup. Ct. in Upjohn stated briefly that such an "absolute immunity" may be overcome
if at the very least a substantially
stronger showing of need, along with
unavailability, can be made over and
above the requirements for overcoming
qualified work-immunity. In Hickmen, the Sup. Ct. held
that discovery of mental impressions will be possible only in exceptionally
rare circumstances.
(2) Qualified immunity: All other
documents in anticipation of litigation by a party or his representative (i.e., notes on what prospective witness said when interviewed) are given qualified immunity. This immunity may be overcome by a strong
showing that the discovering party had
a substantial need for the materials and
that the substantially equivalent docs were not available through other means without undue hardship (i.e, experts, who were going to be called at trial, examined and xeroxed important docs that were later
burned in a fire before the opposing experts
could scrutinize them--xeroxes should be
turned over to opposing experts).
(a) Substantial need means that
the material sought is of substantial
importance to its case, not just
minimally relevant
(b) Party must show that it is
unable to obtain the substantial equivalent without undue hardship.
3 Hickman v. Taylor is the leading case dealing with work-product immunity.
Facts: A tugboat sank, drowning most of the crew-members (including
P’s decedent). Counsel for Ds, the tug owners, interviewed
each survivor separately and obtained signed statements from each.
Counsel for P requested that the lawyer “attach exact copies of all
statements [by the survivors] if in writing, and if oral, set forth in detail
the exact provisions of such oral statements and reports.” Counsel for
Ds refused the request, claiming that it called for “privileged matter obtained in preparation for litigation” was an attempt to get at his
work-product.
Held: P’s discovery request was improper because it violated the trial-
preparation or “work-product” immunity of D’s counsel. But it did not
violate the attorney-client privilege, since this privilege only protects
communications from client to lawyer, not from lawyer to witnesses. The attorney’s mental impressions in this case were absolutely privileged, but the transcriptions of the interviews and signed statements were only
qualifiedly
privileged.
the discovering
party has the burden of showing:
difficult to locate, and that there is no altenative
source for
the information.
privileged information elsewhere, then he has not met the
burden of special
circumstances to overcome qualified privilege.
exceptionally rare
circumstances.
NOTE: A minority
of courts have held that mental impressions can be discoverable with
no showing of relevance or only when they are compelling
and relate to a pivotal issue.
EX: What if a third party--a witness of P’s--is wanted by D for a
deposition, but he does not say anything? He can be subpoened, and if
he refuses to speak or is hostile, then D could make a strong argument
for seeing any written statements between P’s attorney and witness.
Remember, any conversations between P’s attorney and witness is
not protected by the attorney-client privilege and is considered “work
product.”
4. Hickman contrasted with Rule 26(b)(3): In federal court, the
protections of both Rule 26(b(3) and Hickman apply, although they
usually overlap.
There are significant differences, however:
It thus has
no application to mental impressions. But
Hickman is not limited to tangible items and does protect
mental impressions.
lawyers as well as trial preparation by any other representative
(i.e., an agent or consultant) of the
party.
5. Experts
under Rule 26(b)(4)(A) and (b)(4)(B): Lawyers are increasingly
dependent on experts, whether to help them prepare for trials and testify
at trials.
and opinions held by non-testifying experts, are discoverable
only in exceptional
circumstances. The test for whether these facts and opinions are
discoverable is very similar to 26(b)(3):
(i)
The information must be essential
AND
(ii)
There must be exceptional circumstances
(i.e., one party has monopolized qualified experts, or one party had
access to material that disappeared or was destroyed before the other
party looked at it).
P’s lawyer decides not to use one of his non-testifying expert’s assistance in a case since it might contradict P’s cause of action, can D’s attorney hire that expert? No,
only if he can show extraordinary circumstances (i.e.,
there are no
other experts that D can hire).
(2)
In-house experts: Shell Oil Refinery dealt with in-house
experts.
specific case, then they are protected under Rule
26(b)(4)(B)
(ii)
If in-house experts are not retained or specially employed for the
case, then they are treated as normal witnesses under Rule 26(b)(1)
anticipation or in preparation of trial,
then they fall under the work product doctrine of
Rule
26(b)(3).
Rationale: This encourages parties, whether they are poor
or not, to do their own research and
not free-load.
ASK SHERMAN TO CONFIRM THIS.
What is the diff. Between (i) and (iii).
General Hypo: P sues Ford for defective design of a steering mechanism.
How
would P go about discovery?
First, under Rule 26(f), the parties have a meeting to come up with a discovery
plan. Within 10 days
after this meeting, mandatory discovery occurs, and any documents that
fall under 26(a)(1) must be turned over. Under 26(a)(1)(B), all docs
related to the disputed facts, alleged with particularity in the pleadings,
must be either turned over or described. (This is why it is best
for parties to allege their facts with particularity in their pleadings--separating
each thought or factual allegation into separate paragraphs).
This assumes these docs are not protected by any privileges, or that
these privileges are not overridden (as in Dianna Ross case).
If P requests “all docs related to the steering mechanism,” then
under 26(b)(2), it would probably be denied since it is so burdensome
on D and the discovery outweighs its benefit. But if documents
are requested that relate to a specific ballbearing, then under Rules
34 these documents must be turned over. After these docs are turned
over, then interrogs and depos will usually occur.
must be a motion to compel under Rule 37(a). After court compels the party to
respond to the discovery request, and it does not, then sanctions under Rule
37(b)
or (c).
37(b) covers a variety
of sanctions. The more serious ones under Rule 37(b)(2)(B), such
as dismissal or contempt, can be used, even if the offender’s conduct
was not willful or intentional but negligent.
In Cine Forty-Second Street v. Allied Artists, the Second Circuit
held that severe sanction was appropriate where the discovery to comply
with the discovery order was grossly negligent. Even if
the offender finally filed the required interrogatory answers, he can
still be sanctioned severely.
Rationale: Gross negligence delays litigation as much as intentional disregard of
court discovery rules.
EX: When P failed to provide adequate answers to interrogs regarding dams, the ct precluded P from introducing evidence of dams, leaving P only a claim for
injunctive relief.
Cine Forty-Second Street
Adjudication
Before Trial: Summary Judgment
that A exists, the judge must direct the jury to find that A does not exist.
The party in such a
situation bears “the burden of production,”
which means that there must be sufficient evidence that a reasonable
trier of fact could render a decision without having to speculate.
If this burden is not met, then the judge can grant, say, a motion
for summary judgment or an order a directed verdict.
evidence, the jury cannot decide whether A exists or not, it must find
that A does not exist. The party seeking to prove A bears the “burden
of persuasion,”
which is a preponderance of the evidence
(more than 50%).
The burden of production is not necessarily placed on the same party as the
burden of persuasion. Indeed, the burden of production may itself shift
throughout
the course of the trial:
EX: A trial consists of only one issue, A, which P asserts and D denies. P starts
out bearing initially the burden of producing some evidence of A. If he produces
just enough evidence so that the judge finds that a reasonable jury might find that
A exists, P had met his burden of production. If P produces so much evidence
that he is, in the absence from D, entitled to a directed verdict, P has shifted
the burden of production to D. If D now produces the evidence, he can either
make a jury issue of A
(in which case neither P nor D bears the burden of production any more)
or he can produce enough evidence so that P must once more meet the
burden of production, or suffer a directed verdict against him.
as a 12(b)(6), look
only at the face of the pleadings and test only if they are legal sufficient
(i.e., they state a legitimate cause of action). A summary
judgment, though, allows the court to go beyond just the pleadings
and look at evidentiary material.
matters as to which the affiant has personal knowledge and
which would be
admissible at trial. Rule 56(5)
the fruits of discovery (i.e. depositions, interrogatory
answers, etc.), no matter which side they were obtained
from.
Rule 56(e)
persuasion on an issue at trial, the movant bears the initial burden of
of production
on that issue. That is, as part of his SJ papers, he bears the
burden of coming forward with info. that clearly shows there is no factual
dispute and that warrants granting a motion for SJ.
the burden of proof
had to make as strong a showing as one with the burden
of proof to invoke SJ. Addickes v. S.H. Kress
(where D moved for SJ, and Sup. Ct. held that, even though P could not
prove in a conspiracy charge the presence of police earlier in the day,
the burden was on D to prove they were not there).
b. Modern view (Celotex): Celotex v. Catrett altered the early view. The Sup Ct in this case liberalized the burden on a moving party and made it easier to obtain SJ. Normally, the movant will,
as already mentioned, use affidavits or discovery materials
to show the lack of a genuine issue of fact. But in those
situations where the responding party will bear the burden
of persuasion at trial, the movant will not necessarily
have to come up with affidavits, depositions, or other
evidentiary materials. Instead, he may be entitled to SJ by
merely showing that the existing record contains no evidence
that the other side (which bears the burden of persuasion at
trial) will
be able to prove an essential element of its case.
EX: P claimed to have been injured by exposure to asbestos
manufactured by D. After discovery, D moved for SJ on
the grounds that there was no evidence in the record that any
of D’s products caused the injury, an issue on which P would
clearly have the burden of persuasion at trial. D did not produce
affidavits, depos, or any other info. In support of the proposition
that its products were not the ones that caused P’s injury--it
simply pointed out to the court that P had no evidence
implicating D’s products. Held: SJ is granted to D. Under
Rule 56, there is no express or implied requirement that
the moving party support its motion with affidavits or other
similar materials
negating the opponent’s claim. Celotex. This is
modern view (the traditional view would have required that D affirmatively
proved that he was not the manufacturer of asbestos).
(1). Bald assertions not sufficient: Even under
Celotex, however, the moving party must do more than
merely state in a conclusory fashion that there is no
evidence for an essential element of the other party’s
claim. The moving party must review all affidavits,
depos, interrogs, and other parts of the record, and must
explain to the court in some detail why these materials
fail to establish the existence of an essential element in
the
other side’s case.
Rationale: SJ could be converted
into a tool of harassment.
under Addickes and Celotex
can do two things:
non-moving parties claim, and thereby show that
there is no
genuine issue of fact, OR
establish the
existence of an essential element
(i.e., other side could not prove D made asbestos)
NOTE: It is usually easier for moving party to opt
for #2 instead
of #1.
standard as a directed verdict. He thinks that the moving party
puts on the opposing party, with the burden of proof, the task of
producing evidence sufficient to sustain a verdict in its favor.
The problem with this is that it would require basically a full
trial at the SJ
stage.
4. The jury and SJ
a. “Slightest
doubt” standard contrasted (and overturned):
Some App. Ct. cases hold that a jury should decide issues of
slightest doubt. Arnstein v. Porter (where 2d Cir held
that SJ was not appropriate since, even though D had never met P and
P claimed D stole his music compositions, D’s music was similar to
P’s and P’s compositions were widely distributed). Nowadays,
though, judges are skeptical of juries, and so SJ is often
granted.
b. “Disbelief evidence”: The theoretical possibility that a jury could disbelieve an uncontradicted witness and render a judgment
against that witness,
is irrelevant to an SJ motion. Dyer v. MacDougal (where
SJ in a defamation action was granted in favor of D when D produced
evidence that everyone to whom the alleged defamation was published
denied receiving such statements). Thus, in order to get past
SJ, it is smart for an attorney to try to get the witness during depos
to be recalcitrant, evasive, etc. (however, attorney would not be acting
in very good faith).
NOTE: This case differs from Arnstein in that: In Arnstein, SJ was
inappropriate if there was any doubt whatsoever, while in Dyer
SJ
can be granted even though there is some theoretical doubt.
6. Complex cases and clash of the experts: In complex case, court have
have evinced more willingness than in the past to entertain SJ, even
when discovery reveals that the experts
disagree with each other.
EX: Ps, a group of American TV manufacturers, accused Ds, a group
if Japanese TV makers, of conspiring to lower prices (“predatory
pricing”) in an attempt to take over the market. P’s experts affirmed
P’s theory, while D’s experts said that “predatory” pricing is not
economically efficient and that they had virtually no chance anyway
of monopolizing the market. D moved for SJ, saying they would never
engage in such a conspiracy since it would be economically inefficient.
Held: Even though there is a clash of the experts, SJ is granted since
D would have never engaged in “predatory pricing” for economic reasons.
Ed adds that this ruling is good, since experts will say anything for
the right amount of money.
Matsushita v. Zenith
NOTE: In Eastman Kodak, the Sup. Ct. limited the extent of Matzushita,
arguing that the nonmoving party’s inference--that based on the
evidence the moving party is guilty--must be reasonable, and that
there
is no special burden on Ps in antitrust cases.
ASK SHERMAN TO CLARIFY WHAT EXACTLY THE “INFERENCE” TEST IS (he mentioned that it also replaced the “slightest doubt” test).
Judicial Supervision of Pre-Trial
and Promotion
of Settlement
A. Pretrial conference generally: 1993 changes to the FRCP provide for
mandatory meet and confer sessions among the parties (Rule 26(f)), numerous
pretrial conferences (Rule 16(a)-(c)), and a final pretrial conference (Rule 16(d)).
The following is order
for scheduling sessions:
“scheduling order”
within 120 days after service of complaint.
This scheduling order must set a time limit for joinder of additional
parties, amendment of the pleadings, filing of motions, and completion
of discovery.
under discovery, at least 14 days before the Rule 16(b) scheduling conference order, the parties must meet and confer regarding “the nature
and basis of their claims and defenses” and to develop a discovery plan.
Within 10 days after this meeting, they are to submit a written report
to the court on their
plan.
NOTE: As has been previously discussed, for certain reasons (i.e.,
discovery is “unduly burdensome”) then judges can limit discovery
under Rule 26(b)(2).
stipulated or directed by the court, initial disclosures shall be made at or
within 10 days after the meeting under Rule 26(f). Under 26(a)(2),
disclosure of expert testimony must be made at least 90 days before
the trial date.
Responses to this testimony must be filed within 30 days after disclosure
by the other party.
discretion direct the attorneys for the parties to appear before it
for a conference, or have a conference before the trial to prepare
for the trial. The court can order counsel to appear at a pre-trial
conference, and it can also order litigants represented by attorneys to appear (i.e., a “corporate representative with the authority to
settle”). Of course, these litigants must show up to court on their
own terms, not those imposed by a judge who might want them to
settle for a certain amount of money, in order for there not to be
abuse of discretion
by the court. G. Heileman Brewing v. Joseph Oat.
Rule 16(f) allows judge to apply sanctions where just. It gives the judge
authority
to use the sanctions imposed under Rule 37(2)(b)(2)(B) and (C).
best, since the judge attempts to settle the case and his neutrality
could be undermined
in court (Hofstra case)
lawyer who offers his
views.
4. Court-annexed
arbitration: Three arbitrators rule on the dispute.
These people decide
the case
decision is not binding.
ADD HERE INFO CONERNING ATTORNEY’S
FEES, PARTS OF A TRIAL, ETC. ?
suits at common law…the right of trial by jury shall be preserved.”
This provision clearly
applies to federal trials.
effective, there was a split between equity and legal issues. In courts of
equity, there was no right to trial by jury, while in the law courts, this right
existed. Nowadays, a federal court will consider whether the claim is “legal”
or “equitable” as such terms were understood in 1791, the year in which the
Seventh Amendment became
effective.
“equity” was vague and shifting. The main distinction related to the
remedy
sought.
damages were not available, such as injunctions, specific
performance, recission, etc., or an adequate remedy at law
was unavailable.
Contempt sanctions would be enforced in the event of disobedience.
and other remedies (i.e., replevin, ejectment) that could be
enforced by court officers with or without the cooperation of
the parties. For an issue to be tried by jury, there must have
been an adequate
remedy at law available.
“Dairy Queen” trademark. The K terms provided that D make
certain payments
for the use of the trademark.
kinds of relief: (1) an injunction preventing D from further
use of the trademark, and (2) an “accounting” to determine
the amount D owed,
and a judgment for that amount.
accounting demand, arguing that since it was a demand for
a money judgment, it was clearly legal, not equitable.
(Obviously, D thought it would have better luck with a
jury as the trier
of fact instead of the judge).
since it asked
not for dams but for “accounting.”
dams or trademark infringement, or for the sum owed under
the contract (it was not clear which was being sought), the claim
dealing with
“accounting” was definitely legal.
(1) Use of certain language does not necessarily
determine nature of claim: The use of the word “accounting” in the complaint did not make the
claim equitable. To say that its money claim was
equitable because it was cast in terms of an “accounting”
instead of an action for “debt” or “damages” would be
to make the constitutional right to trial by jury depend
on the choice
of words used in pleadings.
(2) Legal relief not adequate: The claim would have
only been equitable if no adequate legal remedy was
available. Where a money judgment is sought, the only
reason legal relief might be inadequate is because the
accounts between the parties are so complicated that a
jury cannot understand them. But now that special
masters are available under Rule 53(b) to assist the
jury in understanding such complicated matters, it
certainly cannot
be said that legal relief is inadequate.
E.
Actions joining legal and equitable claims (as in
Dairy Queen):
issues affecting the claim for legal relief must ordinarily be tried
first to the jury. Then, after the jury makes its decision, the judge
will decide whether equitable relief (i.e., an injunction) will be
granted.
NOTE: A party can seek interlocutory injunctive relief (a TRO or preliminary injunction) if they would suffer irreparable harm from delay
in granting an injunction. The party
need only show provisional findings.
A. Judgment N.O.V. and Directed Verdict (now combined as
“judgment as a matter of law”)--Rule 50: Prior to its amendment in 1991, Rule 50 provided for two different motions to control the
jury’s verdict--JNOV and directed verdict. Under the prior Rule 50,
a party could move for directed verdict before the case was submitted
to the jury, while a party could move for JNOV after the jury verdict
was rendered. Other than the difference in timing, the two motions
were identical. In 1991, JNOV and directed verdict were merged and subsumed by the term “judgment as a matter of law.” In
many
jurisdictions, though, the traditional terms are used.
1. Judgment N.O.V v. Directed Verdict: At the close of proof, motions may be used to determine whether a party has carried the burden of producing evidence. A judge who is requested to grant a directed verdict is in a dilemma. If he grants the directed verdict, the appeals court may find that he erred, and a whole new trial will be necessary, wasting the
original jury’s work. But he can avoid this problem by reserving
judgment on a motion for a directed verdict, and submit the case to
the jury. Then if the jury decides against the movant, the judge can
evaluate the legal sufficiency of the evidence on a motion for JNOV.
A JNOV results in the entry of judgment for the party who lost
the verdict it is a finding that the verdict had no sufficient legal
basis.
trial if the appellate court holds, contrary to the trial court,
that the evidence was not sufficient to take the case from
a jury, since the jury’s verdict can simply be reinstated.
But if the appellate court holds there was an error in granting
a directed verdict, a new trial
will be necessary.
NOTE: Motions for a judgment as a matter of law (JNOV and
Directed Verdict) effectively acts like a delayed summary judgment,
in that it determines whether there are genuine issues of fact for
the jury to decide.
(Summary Judgment,
JNOV, Directed Verdict): The general standard for granting motion
for judgment as a matter of law is whether there is a legally sufficient
evidentiary basis on which the jury could find for the nonmoving
party. The jury can draw inferences from the evidence, as long
as they do not involve great leaps of logic. The application of
this standard depends on whether or not the moving party has the
burden of proof on the issue raised.
has the burden of proof, judgment as a matter of law is
appropriate only if the evidence favoring the moving party is
of such compelling
strength that the jury could reasonably find for the opposing
party.
judgment as a matter of law does not have the burden of
proof, then the
motion should be granted only where the opposing party has no substantial
evidence to permit a jury to reasonably
find in the opposing party’s favor. Galloway v. U.S. (where
P had such large gaps in his story--including an eight year period with
just a few incidents that only he could testify to--that a directed
verdict was granted since there was no substantial evidence to permit
the jury to reasonably find for P).
jurisdictions the “scintilla rule” is evoked. Under this rule, a party with a scintilla of evidence would be allowed to have
his case presented to the jury. “Scintilla” has not been
defined--some say the tiniest bit of evidence that a
reasonable jury could believe and come to a conclusion,
but this definition
still begs the question.
process really must be made on a case-by-case basis, but
a number of governing
principles are helpful in analysis:
favor of
the non-moving party, and to view the evidence in the light most
favorable to that party.
issue to present to the jury; it may not choose between
two versions of events and grant a judgment as a matter
of law to the
party whose version seems more persuasive.
some speculation is not a ground for taking the
case from the jury. If facts are in dispute or
reasonable people may draw different inferences
from the evidence, the jury may use speculation and
conjecture to choose the most reasonable inference. Lavendar v. Kurn (where Sup. Ct. held that a jury verdict cannot be reversed if there is at least some
plausible evidence from which a jury could draw
reasonable
inferences and rule).
said that the case should be taken from the jury
when the evidence presented on any essential
fact by the party with the burden of proof shows only an equal possibility of that fact. This
analysis has been rejected in most jurisdictions
and by
the Lavendar court, as long as there is some basis on which the
jury could choose between conflicting versions of events.
should go to
the jury. However, there are limits to this if:
truly
perceptive.
EX: A claims to see B run a red light and hit a car. Two
witnesses say B did not run red light. This case would
probably survive a judgment as a matter of law and go
to the jury. But if A could not see the red light, perhaps
because it was proven a building obstructed his view, then
a judgment as a matter of law would
probably be granted.
trial on all or part of
the factual issues in dispute. Unlike a directed verdict or NOV,
a judge under Rule 59 weighs the evidence.
1.
Appropriate grounds include the following:
a. Judicial error: A judge that, say, oversteps his bounds and
forces parties to settle against their will. Or judge gives bad
jury instructions.
b. Error during trial: Someone in audience screams “this
company is uninsured,” which has an indelible impression on
juror’s minds.
c. Jury misconduct: From fights in the jury room to strange,
capricious verdicts.
Also, if jurors lie during voir dire.
d. Jury verdict against the evidence: A new trial may be ordered
if the evidence is not legally sufficient to support the verdict.
(A judgment n.o.v.
may also be appropriate here if requirements are met).
e. Newly
discovered evidence:
been obtained
by due diligence before trial.
days after
the entry of judgment. Rule 59(b)
misconduct, newly discovered
evidence, etc.
2. Time limits: A motion for relief from judgment must be made within
a reasonable time. But if the motion is for an issue of fraud, misconduct,
etc., then it must be filed within
a year.
on the form of jury
instructions.
of the verdict, in which the jury makes a decision in favor of
one party or another.
answers to specific factual questions that it is instructed to
decide. In this situation, the jury does not decide directly
which party should prevail on the law. Instead, the special verdicts
should resolve all the material issues so the court can then enter
judgment. Rule 49(a)
jury what the law and reduces jury’s need to understand the
law.
jury may find it harder to reach a unanimous verdict.
Moreover, inconsistent findings on an issue may
necessitate
a new trial.
what is a combination of a general verdict and a special verdict,
can instruct the jury to return a general decision as to which party
should prevail on the law, while simultaneously answering
specific questions
of fact posed by the evidence. Rule 49(b)
letting cross check that the jury understood and adhered
to the instructions
on the law.
instruction with special interrogs carries the risk of
inconsistency
necessitating a new trial. In considering motion for new trial
based on inconsistencies in jury's answers to special interrogatories,
the court is required to harmonize the answers if possible
under a fair reading of them, and try to make the jury’s answer
consistent by reading the verdicts
as expressing a coherent view of the case.
If there is an inconsistency between the special
finding and the general verdict, the judge may
disregard
the general verdict and enter judgment according to the special finding.
Rule 49(b)
if there are inconsistencies among several of
the finding, the judge must order a new trial
unless
he can reconcile the inconsistencies.
EX: Administrator
of estate brought civil rights action against state police officer
and sheriff's deputies, arising out of death of arrestee. Recovery
was sought against state police officer on the basis of unreasonable
excessive force in a seizure, denial of medical treatment in violation
of due process, wrongful death, and assault and battery.
Recovery was sought against deputies for excessive force in violation
of due process, wrongful death, and assault and battery.
After jury verdict finding defendants liable for battery only,
and awarding compensatory and punitive damages, plaintiff moved for
a new trial on basis of inconsistencies in jury's answers to special
interrogatories. The District Court, McKinney, J., held that:
(1) plaintiff did not waive right to challenge alleged
inconsistencies in special interrogatories submitted under rule
governing "special verdicts," by not objecting to allegedly
inconsistent answers to interrogatories prior to jury's
discharge, and (2) it was not inconsistent for jury to have found that
defendants battered decedent, and that defendants should be liable for
punitive damages, but that defendants were not liable for torts
of a constitutional magnitude. There was evidence supporting
the finding that after striking arrestee officer left the scene and
had no additional involvement in securing medical treatment for
arrestee; but jury properly found that any delay in securing medical
treatment that might have been caused by officer's acts or omissions
was not sufficient to rise to level of constitutional violation.
Motion denied. Fed.Rules Civ.Proc.Rule 49(a). Whitlock v.
Jackson
decision, it is not improper for the court to emphasize to the jury the
expense of a new trial and the unlikelihood that another jury would reach
a better verdict, and ask each juror to make a renewed effort to reach
unanimity.
to testify to any “extraneous prejudicial information” or “outside
influence”
that may have altered the verdict. Fed. R. Evid. 606(b)
through juror testimony
(i.e., through affidavits of jurors).
ASK SHERM TO CONFIRM E. 1. a.
EX: Where polling
of jury in open court disclosed a unanimous verdict for defendant
in action arising out of automobile accident, affidavits of jurors respecting
their own observations at scene of accident before returning verdict
were inadmissible to impeach verdict rendered by jury who had
been taken to scene of accident at commencement of trial. Sopp
v. Smith
2. State rules:
Some states, such as CA, are much more permissive in allowing juror
testimony to attack verdicts. In CA., any improper influence--inside
or outside of the courtroom--may be shown.
EX: An L.A. judge
entered a judgment convicting the defendant of possession of marijuana
and he appealed from the order granting probation and order denying
new trial. The CA. Sup. Ct. held that the affidavit of a juror,
which related to the remarks and tone of delivery by bailiff, was admissible
on motion for new trial to prove bailiff's statements and alleged misconduct.
Orders vacated with directions. People v. Hutchinson
Sherman
Hypos (note 5, page 664):
The quotient
verdict: All 12 jurors write down how much they think
D owes, divide that number by 12, and award that amount. This
award could be vacated by the statutory prohibition of resorting to
chance.
Using juror notes
created during private deliberation to impeach its verdict:
Would result in the destruction of all frankness and freedom of discussion
and conference.
Juror says jury
intended higher amount: Extrinsic v. Intrinsic.
What if a juror says after the verdict is announced and the jury has
been excused that the jury intended to award P a much higher amount?
In Attridge v. Cencorp, the court upheld a decision to
refuse to hear the juror’s affidavit on the ground that there was
no assertion the jury had read a different verdict, but only revealed
perhaps the jury’s though processes. Extrinsic evidence suggests
that the verdict the jury delivered was not the actual verdict it intended.
Intrinsic evidence suggests that the extrinsic evidence is merely a
manifestation of the jury’s thought processes.
Getting
into Federal Court
A. Subject matter jurisdiction: The court must have the power to
adjudicate the controversy (i.e., either there is a “federal question”
involved,
or there is diversity of citizenship).
letter, or notice by publication if D could not be located within a particular
state).
KNOW SOP under RULE 4 (c) (d) (e).
jurisdiction (there
must be sufficient contact between D and the state).
commonly available
for giving notice of suit to corporations:
be made on an officer or agent of the corporation. Usually,
the Constitutional test is whether this official or agent is
likely to
pass on the process papers to corporate lawyers or directors.
NOTE: Often times, it is very difficult just getting past the reception desk of a large corporation. Cts are split over whether
leaving service
with the receptionist is Constitutional.
Choosing the Forum--Geographical Location
have both subject matter
and personal jurisdiction.
adjudicate the controversy (i.e., either there is a “federal question”
involved, or there
is diversity of citizenship).
defendant’s person. All of D’s assets can be seized to satisfy
the judgment.
There are two kinds of in personam jurisdiction:
1. General in personam: Appropriate when D’s activities
in the state
are so systematic, substantial and continuous that he would expect
to be subject to a suit there and would suffer no inconvenience from
defending there. Examples include a major American oil co. that
has extensive activities and facilities in a state, or a CEO would fall
under in personam if he very often visited a state where he had a branch
office.
arise out of
contact with the state.
NOTE: Because general jurisdiction is more difficult to
obtain than specific, it is easier
to argue first for spec. jurisdiction.
An action to quiet title to real estate, and an action to pronounce
a marriage dissolved, are examples. The presence of property
in a state vests the state with jurisdiction to adjudicate the rights
of any individual--whether in the state or not--in that property.
How does one distinguish in rem from personal jurisdiction?
If the property was located in the state but the defendant was not
subject to service, then P could claim in rem jurisdiction. But if
prop was beyond the state’s borders but D was subject to
service of process, then P could claim personal jurisdiction. The key to in rem jurisdiction is that the cause of action must arise
out of the property
(A breaks his leg on Ed’s Austin estate, but Ed is domiciled in Louisiana.
A could claim in rem jurisdiction.
action is begun by seizing the property owned by (an attachment), or a debt owed by (a garnishment), the defendant, within the
forum state. This is different from in rem jurisdiction because here
the action does not arise out of the property seized; instead, the thing seized is a pretext for the court to decide the case without any
personal jurisdiction. Any judgment affects only the property seized, and cannot be sued upon in any other court. Shaffer took
the bite out of in rem jurisdiction, requiring that in rem jurisdiction
could not be exercised unless D has such “minimum contacts” with
the forum state
that Int. Shoe was satisfied.
when the person is physically within the state at the time of
service:
individual by virtue of his presence within the forum state. D must be served within the forum state. But nowadays, there
are statutes in
states allowing for out-of-state service.
D is within state for a very short period of time (i.e., man
who was served over Arkansas on a flight from NY to TX.) But Brennan in concurring opinion of Burnan says that there should be some minimum contact with the forum
state and person served should voluntarily enter the state.
Thus, under
Brennan, the man on the plane should probably not be served since he
was in Arkansas for a short time and could not control, and probably
did not know, he would be flying over Arkansas.
(TX lures A,
a resident of OK and a Longhorns fan, into Austin by giving him football
tickets and then serves A).
was justifiably
in the forum state for judicial reasons, i.e., because of an quasi in
rem case or depositions for another case, then he cannot be served.
who is domiciled within the forum state, even if he is
temporarily absent from state (A, who is domiciled in TX with his
family, leaves his wife and lives in CA, where he tries to avoid
child-support payments, but is served by TX in CA for being
a “dead beat dad.” If notice is proper, TX has personal jurisdiction
over A and he must
return to his domicile to stand trial).
Rationale: D receives privileges and protection by virtue of
citizenship of
a state, so state can exact reciprocal duties.
A person is
domiciled where:
Domicile is changed if:
(2) He intends on severing
his relationship with that state.
virtue of his consent, even if he has no contacts whatsoever with
the forum state.
within a state’s jurisdiction (i.e., filing a suit there, agree
to jurisdiction,
etc.).
2. The following is a list of how personal jurisdiction can be exercised
when the person (or corporation) is not physically within the state at
the time of service.
Two questions must first be asked:
out of the state liable? (Today, all states have different kinds of long-arm statutes, which allow courts in a state to obtain jurisdiction over persons not physically present within the state at the time of service.) If no long arm
statue exists,
then cases like International Shoe would apply.
Constitutional? That is, does it cover the case presented?
Does it satisfy
the two-prong test (“minimum contacts” and reasonableness of D going
to the forum state)?
a. In-state
tortious act and the long-arm statute:
Many states have statutes allowing their courts jurisdiction over persons
committing tortious acts within the state. The Illinois long-arm
statute--the first far-reaching long-arm--permits Ill. Courts to exercise
jurisdiction over any person in a cause of action arising from “the
commission of a tortious act within the state” by that person or his
agent.
(1) Out of state acts with in-state consequences: The
clauses in long-arm statutes referring to “a tortious act” or
“tortious conduct” within the state have sometimes been
interpreted to include acts done outside the state which
produce tortious consequences within the state. This has
happened most often in products liability
cases.
EX: Titan, an Ohio co., makes valves which it sells to another
co., which incorporates them into a boiler that is sold to P. The
boiler explodes in Ill., injuring P, who sues Titan in Ill. The Ill.
long-arm allows suit in Ill. Based upon a “tortious act within the
state.” Held: A tortious act is committed where the resulting
damage occurs. Thus, the Ill. Courts have jurisdiction in the
present case. Also,
the ct. inferred that surely it was not the first time that a valve
produced by Titan ended up in Ill. (although dissent disagrees with
this inferrence), and that sale was made knowing the valve would be
placed in interstate commerce and could conceivably end up in Ill.
Gray v. American Radiator Corp. (1961).
NOTE: Ed says Grey has often been cited as saying that if one
product flows through the normal course of commerce, then the
maker of the product is subject to the long-arm statute of the
state where the
product leads to injury.
b. Federal Court jurisdiction:
c. Corporations
(also applies to individuals):
The Supreme Court has dealt with many cases
involving jurisdiction and corporations. Nevertheless, the two-prong
test of these cases applies to individuals
just as well.
1. International Shoe’s approach has generated a two prong
test, which subsequently was refined:
Reasonableness
2. In detail: minimum contacts and purposeful availment: Purposeful availment focuses solely on the
activities
of the defendant and not on P’s interest.
(1) Purposeful availment: The purposeful availment inquiry looks to some voluntary action by D establishing a relationship with the forum, usually one in which D seeks to benefit from the relationship (i.e., selling his products there, advertising in the forum state, designing products for that state, etc.). International Shoe. How do we
know if this action is enough to establish
jurisdiction? The Supreme Ct. has defined
“minimum contacts” differently in the cases. No
contact with the state, or isolated contact,
will not meet the minimum contacts test. But a
single act or continuous and systematic contact with
the state will most likely lead to specific jurisdiction. Systematic, substantial and continuous
contact
will most likely lead to general jurisdiction.
reasonably
foresee being taken to court into forum state. But this forseeability
alone is not sufficient for jurisdiction. World-Wide
Volkswagon
3. In detail: Fair play and substantial justice--reasonableness: While the first prong focused on D’s interest, this second prong focuses on P’s interest. This
prong is only analyzed when the first prong has been satisfied. P’s interest, the forum state’s interest, and other fairness issues (i.e., inconvenience to D if he is forced to
defend away from “home”), are taken into consideration.
Remember: It is only when deliberate contacts exist between the forum state and D that this prong will become
an issue and
need to be analyzed. International Shoe
Cases dealing with the “minimum contacts”
test, and refining it:
1. International Shoe (1945): A Washington statute set up a scheme of unemployment compensation which required contributions by all employers. The statute authorized the state, Washington (P), to issue an order and notice of assessment to delinquent contributions by mailing the notice to nonresident employers. International (D), a Delaware corporation having its principal place of business in Missouri, employed 11 to 13 salespersons under the supervision of managers in Missouri. These salespeople resided in Washington and did most of their work there. But they had no authority to enter into contracts or make collections. D did not have any offices in Washington and made no contracts there, but the salesmen occasionally rented display rooms. Notice of assessment
was sent to one of D’s employees in Washington, and a copy of
it was sent by
registered mail to D’s address.
Held:
Ct. establishes two prong test. The majority held:
--D’s activities
were neither irregular or casual; rather, they were systematic and continuous.
--The obligation
sued upon in this case (i.e., payment for insutance) arose out of these
systematic and continuous contacts, which were sufficient to establish
“minimum contact.”
--D benefited
from its sales in Washington--over $30,000--which is a lot of business.
D must stand trial in Washington.
Other:
What if International Shoe shipped shoes to 30 customers in Washington
from Delaware, and they sued for bad shoes? Yes, this would probably
be minimum contacts, since Int. Shoe benefited from sale and knew where
it was shipping. What if shoes were shipped to Washington, but
fell apart in Oregon? Int. Shoe could not anticipate being brought
to trial in Oregon and there is no availment, so no minimal contact.
insurance from International Life’s (D) predecessor. When D assumed the obligations of the predecessor, it mailed a certification of insurance to the son, who lived in CA. P paid the premiums by mail to D to its home office in TX for two years. He was the only CA policyholder, and D solicited no other business in that state. Upon his son’s death, P, as beneficiary, filed a claim which D denied, claiming the son died because of suicide. P sued in CA, basing his long-arm jurisdiction on a statute allowing suits on insurance contacts with CA residents. This statute was passed after P had begun his relationship with D. P obtained a default judgment in CA, because D did not show up to court. P sued on the
judgment in TX,
but TX ct. refused to enforce judgment.
Held:
The majority held:
--Since insurance was involved, the CA long-arm did apply
to D (the fact that the statute was created after P and D
entered
into a relationship is irrelevant).
--There were
sufficient contacts to allow jurisdiction in CA because CA has a
substantial interest in protecting its citizens, by giving them
a local forum.
--There was also sufficient contact because P and D had entered into a contract (an insurance policy), which
lasted two
years.
--The fact that D had not actually entered the state is irrelevant. Because of technological developments--fast mail, modern transportation, etc.--a D need not enter into
the forum state any longer in order for there to be minimal
contacts.
--It was less
of an inconvenience for D to go to CA than for P to go to TX (this is
the second prong of test). TX must enforce the judgment.
Other:
If insurer had bought policy in TX and then moved to CA, there would
almost surely be no jurisdiction in CA (lack of availment, forseeability
and minimum contacts).
NOTE: This
case represents a very liberal approach to min. contacts.
3.
Vergara (1975): Generally, courts have rejected jurisdiction
in cases where the out-of-state defendant advertises in the estate inviting
residents to sample its wares elsewhere. But in Vergara,
Ps had booked an around-the-world flight with their travel agent in
Omaha, but their Tashkent-Kabul link on Aeroflot (D0, a Soviet airline,
was canceled due to the Afghanistan revolution. P sued Aroflot,
and court held that the Russian airline had authorized Pan Am to act
as its agent, and that Pan Am had in turn authorized the local travel
agent to act as its agent, thus showing that D transacted business in
Omaha and that there was minimum contact for jurisdiction.
4.
World Wide Volkswagon (1980): P sued Seaway
(D), an Audi distributor (not a manufacturer), for negligent
placement of a gas tank which caused the car, bought in New York, to
explode in a crash in Oklahoma.
Held:
The majority found:
--The foreseeability alone of the car going into OK, without “affiliating circumstances” (i.e. purposeful availment), was
insufficient
to establish jurisdiction. Otherwise, every seller of chattels
would have to face suit wherever his chattel ended up and there was
a cause of action. Specifically, the ct. said that the dealer
had not sold cars there, advertised there, cultivated OK customers,
or focused on OK market. In short, it did not avail itself of--or
directly benefit from--OK. (However, the tri-state area in the Northeast
could gain personal jurisdiction over these Ds should an accident occur
there, since Ds purposefully availed themselves in this area and had
established min. contacts).
--The Audi’s
presence in OK was the result of P’s unilateral activity, not
D’s efforts.
--In dicta, the ct. explained that OK could assert jurisdiction over the manufacturer and national importer of Audis, since they cater to a national market, distribute their product across the country (either themselves or through dealers),
and receive economic benefit countrywide and expect to
reasonably
be subjected to lawsuits in any state.
To summarize, WW VW indicates that the ct must find purposeful
conduct either
by direct acts of D in the forum state (not P’s unilateral acts) or
by conduct outside of the state that, because of its character, D should
have foreseen going to court in the forum state.
Dissent (Brennan): Brennan’s dissent stated that Ct. should not
distinguish between goods taken into the state by a consumer from
those taken into the state by the normal stream of commerce. Also, Brennan argued that the sale of a car purposefully injects the
vehicle into the stream of interstate commerce and that D should thus have anticipated litigation from any of the states. Finally, he
says that the state
has an interest in protecting its own citizenry (CA’s arg in McGee).
5. Asahi (1987): WW VW establishes that the mere fact that the consumer takes the product into the forum state is not sufficient to confer jurisdiction over the manufacturer, even if the latter should have foreseen that the user might do so. Suppose, however, that a
Manufacturer, a foreign company, repeatedly sells to Merchant,
a non-forum-state business, who repeatedly resells some of the goods in the forum state, that Manu. knows this is happening, but that Manu. makes no other efforts directed at the forum state (i.e,
advertising, sales office, etc.). In Asahi, the court split on just
this issue. P lost control of his motorcycle while riding in CA,
and was seriously injured. He brought suit, claiming the cycle’s
rear tire and tube were defective. One of the co-defendant’s
was Cheng Shin, the Taiwanese manufacturer of the tube. Cheng
Shin in turn impleaded Asahi, the Japanese manufacturer of the tube’s valve assembly, and sought indemnity from Asahi for the full amount of Cheng Shin’s payment to Zurcher. P settled all of his suits, leaving only Cheng Shin’s impleader suit against Asahi.
Over a five-year
period, Asahi shipped over a million valve assemblies to Cheng Shin,
and was aware that valves sold to Cheng Shin would end up in the U.S.
and CA. However, Asahi made no direct sales in CA, had no offices
or agents there, and did not control the system of distribution that
carried its products into the state.
Held:
--As to the first prong of the min. contacts test, the maj. of the Ct. (except for O’Connor) agreed there were minimal
contacts, but
there was no majority in terms of which test ought to be used:
--O’Connor’s “stream of commerce plus” test:
O’Connor, in her plurality opinion, stated that
a manufacturer’s contacts must be “more purposefully directed that the forum State than the mere act of placing a product in the stream of commerce.” Asahi’s mere awareness that the valve
assemblies
it sold would eventually end up in CA was not sufficient to establish
min. contacts.
--Brennan (“regular and anticipated flow” test):
Brennan said that there were sufficient contacts,
and that any additional contact, outside of just
the regular and anticipated flow of products in the
stream of commerce, was not necessary to establish
min. contacts.
--Stevens
(“quantity test”): A very similar test to Brennan, focusing
on how often, how much, and value, to determine minimum contacts.
Also agrees Asahi had minimum contacts.
--As to the second prong of the min. contacts test, the majority says it would be unreasonable and unfair for
CA to hear the case because of the: (1) Burden to Asahi of defending itself in a foreign legal system; (2) slenderness of CA. and Cheng Shin’s interests in having the indemnity claim hear in CA; (3) CA. jurisdiction would create foreign relation problems between two foreign defendants--their
indemnity claim
should be dealt with in one of their countries. Thus, CA has no
jurisdiction over Asahi.
min. contacts rule
has been applied in the dom. relations context.
EX: P, a divorced wife residing in CA, brought an action in CA against D, her former husband, who was domiciled in NY, to
gain custody of their children and to increase the husband’s
child support obligations. The couple entered into a separation agreement in NY under which the children, a son and a daughter,
were to live with the father in NY and spend vacations with the
mother in CA. Shortly thereafter, D’s son and daughter decide
they want to live with their mother, and move to CA., the son
w/o his father’s
consent.
Held:
The majority held:
--CA. does not have jurisdiction over D for lack of
minimal contacts. D did not benefit in anyway from
the CA by his children moving there (he did not derive
any financial benefit from the move, and any dimunition
in his household costs was not due to the children’s
presence
in the forum state but their absence from NY).
--D’s act had not been purposeful and volitional; rather, his kids unilaterally acted and moved to CA on their
own
accord--he did not make them move.
--The cause of action arose not from D’s comm.
transactions in interstate commerce but rather from his
personal, domestic
relations.
--For policy
reasons, CA should not have personal jurisdiction. If it did,
parents would be deterred from cooperating in custody agreements that
were in the best interests of the children.
--Even though CA may had a strong and substantial state
interest in
the case, the existence of min. contacts remains the essential criterion
for jurisdiction.
action does not arise from the company’s in-state activities (as
in the previous cases above), contacts between D and the
forum state must be so “systematic and continuous” that they
establish general
jurisdiction.
EX:
Helicopteros (1984):
D, a Columbian corporation which provided helicoptor transportation
for oil construction companies in South America,
signed a contract to provide such services to Consorcio. Ps, the
estates of Consorcio employees, brought suit for these employees’
deaths when a helicopter piloted by D crashed in Peru. D’s contacts
with TX, the forum state, included:
Consorcio officials
Helicopter
Co. of TX, at a cost of more than $4 million.
(4) The receipt in two non-TX American banks of payments
by Consorcio drawn upon a TX bank.
Held:
The majority held:
--Since D’s activities did not arise out of its in-state activities, Ps must prove that there were substantial,
continuous activities sufficient to create general
jurisdiction.
Here, these contacts are lacking.
--The single trip to negotiate was not a “continuous,
systematic”
contact.
--The receipt of checks drawn on a TX bank was a
“unilateral activity of another party” (Consorcio) and
thus should not be taken into account (Kulko was cited
on this point).
--The sending of personnel to be trained did not have any
independent
significance; it was “part of the package of goods and services purchased
by D.”
--In the most significant part of its decision, the Court
held that “mere purchases, even if occurring at regular
intervals, are not enough to warrant a State’s assertion
of in personam jurisdiction over a non-resident corporation
in a cause
of action not related to those purchase transactions.
Dissent (Brennan--“cause of action ‘related to’ test”): Brennan, the only dissenter, argued that the cause of action was related to (although not “arising out of”) D’s in-TX contacts.
After all, D bought its product in TX, negotiations occurred in TX,
and the pilots trained in TX, so it was “fair and reasonable” to
allow the suit
to go forward in TX.
Other: If a Bell-manufactured part on the helicopter led to the
crash, or if the helicopter pilots who were negligently trained in TX
caused the crash,
then TX would have general jurisdiction over Bell.
NOTE: Helicopteros is a good example of a case where Ps could not establish personal jurisdiction (since the cause of action did not
arise out of D’s activities in the forum state), and thus had to make
the very difficult
argument for general jurisdiction.
Publications (“effects test”): In libel cases, where the cause of action does not arise from contacts with the forum state, the
court has employed
an “effects test,” which examines where the focal point is of
both the story and harm suffered
(it focuses on P’s on harm to P).
1.
Calder v. Jones (1984):
D, the National Enquirer (which is a Fla. Corporation), wrote a story
about Shirley Jones, who lives and works in CA. It said that she
was a drunk. P, Jones, sued the Enquirer for libel in CA state
ct. Perhaps because some 12% of its nationwide circulation of
5 million is sold in CA, nearly twice the distribution of any other
state, the paper answered without raising any objection to jurisdiction.
Jones also sued Calder, the paper’s editor, and South, the reporter
whose byline appeared on the story. Both were Fla. residents and rejected
jurisdictions. Calder and South said they went to CA only a couple
of times for research.
Held:
The court established the “effects test.” The majority held:
--Ds wrote an article knowing that the brunt of the
effect of the harm would be felt in CA, where P lives and works and where the Enquirer has its
largest circulation of any state. CA’s personal
jurisdiction
is justified, since “effects test” is satisfied.
--Ds should also have foreseen the possibility of going to court in CA, because of their article (although mere foreseeability alone will not
justify personal jurisdiction).
2. Hustler (1984): P, a NY resident, sued D, an Ohio
corporation, in Ohio, but the suit was dismissed due to
an SoL problem. P (who was not a resident and had no
other contacts with it) filed suit in NH, where SoL had not
expired, and claimed that Hustler injured her reputation
in NH and elsewhere. D’s contact with the forum state
consisted solely of the circulation there of from 10-15,000
copies per
month of its magazine, Hustler.
Held:
The majority held:
--The cause of action arose “out of the very
activity being conducted, in part, in NH”--namely,
the regular monthly sales of thousands of
magazines,
which could hardly be described as random, isolated or fortuitous.
--NH had a state interest in redressing D’s injuries,
which occurred within the state. Even though she
was otherwise
unknown to NH, D’s misrepresentations harmed her.
in-state P and the out-of-state D have a contractual relationship?
The Sup. Ct. has
held that, even though one party to the contract is a resident of the
forum state does not automatically mean that the other party has “minimum
contacts” with that state, the whole contractual relationship may
well, in a particular case, be sufficient to confer jurisdiction.
In Burger King, the Ct said the following must be taken into
consideration when deciding whether the contractual relationship establishes
personal jurisdiction:
(4) The
parties’ actual course of dealings.
EX: Burger King (1985): The K allowed D, an individual
residing in MI, to run a fast-food restaurant in MI under a
franchise from P, Burger King, which had its headquarters in
Fla. BK brought suit in order to terminate the franchise agreement
and to collect payment alleged to be due under it. The agreement
provided that Florida law could control, but expressly stated that this choice of Fla. law “does not require all suits concerning this
Agreement to be filed in Fla.” D never went to Fla., but there
were some mail and phone negotiations between P and D. K
required all payments and notices to be sent by D to Fla. office.
The Fla. long-arm
provided for service if there was any b/K.
Held:
The majority held there was personal jurisdiction:
--D, in the present case, entered into a long-term (20 yr.),
highly structured K with P involving continuing and
wide-reaching
contacts with P in Fla.
--Negotiations
were made, through the mail and phone, with the Fla. office (not a local
office, say, in MI)
--His refusal to vacate the premises and continuing to use
the BK trademark after termination caused foreseeable
injuries to
P, along with the “choice of law” agreement, put him on notice that
he could be taken to court there.
--D’s connection
with Fla. was hardly “random” or “fortuitous.”
--The court attached special importance to the contract’s
designation of Fla. law as the controlling law. By signing
such a contract,
D has purposely availed himself of the benefits and protections of the
forum state’s law.
--D’s only defense to personal jurisdiction here would be
that there was fraud or unequal bargaining power, but that
is not the
case (both parties were sophisticated).
--Finally, as to the second prong of the test, D’s lesser
financial resources are not sufficient to make P go to
court in MI.
Dissent (Stevens): 1) D had few actual contacts with Fla; 2) D’s
negotiations were mostly with people in MI, not Fla., office; 3) D
had reason to believe that since MI office was the office that
negotiated and supervised K, any suit would be brought in MI;
4) There was substantial inequality
in bargaining power.
NOTE: BK establishes several
useful principles:
relationship
will go a significant distance towards establishing minimum contacts
(but is not dispositive).
the forum state’s law the law to be used in any lawsuit will
carry significant weight, since such a provision indicates that the out-of-stater has chosen to receive the benefit of the
forum state’s
legal system.
required by
K to send payments and reports into the forum state will also be a significant
factor.
a very short period of time, if K terms are obtained through fraud or unfair bargaining power, if franchise if “primarily
intrastate in character” or if the franchiser’s decision-making structure are different (i.e., more authority is vested in the local office and less in the forum-state-based office),
then there may not be jurisdiction. The underlying question is whether the franchisee should reasonably
anticipate
out-of-state litigation.
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