Civil Procedure Outline

A. Traditional Bases for Jurisdiction

Pennoyer v. Neff

 Personal Jurisdiction is acquired by personal service inside the territorial limits of the forum state or by the
voluntary appearance of the defendant there to contest the suit on its merits.

 Plaintiffs are not free to bring suit wherever they chose. The 14th Amendment to the U.S. constitution forbids the
states from “depriving any person of life, liberty or property without due process of law.” No State shall make or
enforce any law which shall abridge the privileges or immunities of citizens of the United States

 No state can exercise jurisdiction over persons or property outside its territory

 In Personam jurisdiction State exercises jurisdiction over the person because:

i) the person is present in the State;

ii) the person consents to (or waives objection to) the exercise of jurisdiction, agreeing to be present in the State.

iii) the person is a citizen of the state;

iv) the person's status is being determined based on a relationship to a citizen of the state.

[2] Consent
A defendant may consent to the court’s personal jurisdiction in advance of suit, and such consent, if expressly made, functions to cure
any jurisdictional defects that might otherwise exist. Examples of express consent include:
(1) forum-selection clauses in contracts [see Carnival Cruise Lines, Inc. v. Shute,499 U.S. 585 (1991), in which the Court upheld a
clause printed on the back of the plaintiff’s steamship ticket]; and
(2) consent documents filed by foreign corporations with state authorities as a condition for doing business in the forum.

[3] Waiver
When a nonresident defendant objects to a state’s personal jurisdiction over him/her on due process grounds, he/she must preserve
such objection or risk waiving it. Waiver need not be express. It is enough that a party act in a way which is incompatible with the
party’s argument that the forum lacks a basis for asserting personal jurisdiction over him/her. Defendant will waive his/her challenge
to personal jurisdiction if he/she either fails to
include it in a motion to dismiss made on other grounds, or fails to otherwise raise the matter by motion or pleading. Today, most
states, as well as the federal system, no longer require a defendant to make a
special appearance for the purpose of contesting jurisdiction, separate and apart from any other grounds on the merits of the case.
Defendant does not prejudice his/her motion to dismiss by joining with it other grounds for dismissal.

Blackmer v. United States: Personal jurisdiction authority can be based on upon U.S. citizen ship (served outside the U.S.
was a U.S. citizen)

Miliken v. Meyer: Personal Jurisdiction may be based upon the defendant’s domicile within the forum (domicile in WY
lived in CO).

 In Rem jurisdiction: State exercises jurisdiction over property based on the property's presence in the State.

 quasi in rem jurisdiction: State exercises jurisdiction over a person based on his/her ownership of property
present in the State. Jurisdiction limited to disposition of the property, or judgment in an amount no greater than the
value of the property

 To satisfy the Constitutional requirement of due process, personal jurisdiction requires the presence or consent (actual
or implied) of the defendant or his property.

Could Mitchell serve Neff by mail based on:

1) Neff's close relationship to Oregon,
2) his having engaged Mitchell to do legal work there,
3) his ownership of property there,
4) his having lived there when the debt was incurred,
5) his use of Oregon law and courts to file his claim for his land, and
6) his intent to return there to live?

 1877 -> 1945

Under Pennoyer, a state could not exercise jurisdiction in an action in personam over an absent, non-consenting, non-resident
defendant. But if the defendant was “doing business” in the state, it was sometimes construed to have consented or be
present in the state, and therefore subject to jurisdiction under Pennoyer.

B. Expanding the Bases of Personal Jurisdiction

Hess v. Pawloski

 Personal Jurisdiction may be acquired by enactment of a nonresident motorist statute. The decision rests upon the state police
power.

 Massachusetts has a statute that states by driving in the state you appoint the registrar (now the secretary of state) as your
agent for service process

 Limited the proceedings to accidents in the state no hostile discrimination of non-residents but tends to put them to the same
standards of their residents.

C. A new theory of Jurisdiction

International Shoe Co. v. Washington

 Implies that the minimum contacts jurisdiction is limited to claims arising out of or related to the defendants contacts with
the forum state (i.e. claims arising out of shoes sold in Washington).

 In an action in personam, a State MAY exercise Personal Jurisdiction over persons found outside its borders if they have
such minimum (read substantial) contacts, ties or relations with the forum state that the exercise of jurisdiction does not
offend traditional notions of fair play and substantial justice. Contacts cannot be casual or isolated.

 The Supreme Court extends jurisdiction in actions in personam to certain absent, non-consenting, non-resident defendants,
as long as their contacts, ties and relations with the state are sufficiently substantial that the exercise of jurisdiction does not
violate traditional notions of fair play and substantial justice.

 What criteria do we look for

- Undue Burden -- substantial inconvenience to Defendant.

- Whether Defendant had systematic & continuous activities in the state which gave rise to the claim.

- Whether Defendant has exercised the benefits and protections of the state’s laws.

D. Specific Jurisdiction and State Long Arm Laws

 Specific Jurisdiction is properly asserted when the defendant’s activities in the state gave rise to the claim. (arise from or
related to) A nexus exists between the defendant, the state, and the claim
 1. The development of the Long Arm Laws: reach out of the state to call a nonresident defendant back into the state
to defend lawsuits. If they base personal jurisdiction on specific acts they require that the claim arises out of those
acts.

 Gray v. American Radiator & Standard Sanitary Corp.

In this case the court assumes that the valve is going to be sold in interstate commerce (other places than Ohio). The Gray
court concluded the that Ohio valve maker (which had done nothing in Illinois) had “committed a tortious act” in the state,
since the explosion that caused P’s injury took place in Illinois. Expansive interpretation (criticized but not overruled)

 “As a general proposition, if a corporation elects to sell its products for ultimate use in another State, it is not unjust to hold it
answerable there for any damage caused by defects in those products.”

McGee v. International life Insurance Co.

Although the defendant has only single or isolated contact with the forum sate, there is personal jurisdiction on a cause of
action related to that forum activity (specific jurisdiction)

 In the due process test they focus on California’s interest in litigating this claim and the convenience factors. Balance the
interests of the plaintiff, defendant, and the forum to determine if exercising jurisdiction is desirable.

 Note that in note 2 on p. 90 the authors ask if the case should be seen as:

1) illustrating a two-part test. First, are there enough contacts to satisfy the requirement of due process. Second, if yes, do
the interests of the plaintiff, defendant and forum, on balance, favor jurisdiction; or

2) illustrating a relaxed requirement of contacts when the interests of the forum state and the plaintiff strongly favor
jurisdiction

Hanson v. Denckla

 It is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of
conducting activities within the forum sate, thus involving the benefits and protections of its laws.

 Choice of law: A claim with multistate contacts or a claim of federal or state, we have to decide what law to use. Separate
from choice of jurisdiction.

 Unilateral activity cannot satisfy the requirement of contact. . . .

 "It is essential in every case that there be some act by which the defendant purposefully avails itself of the privilege of
conducting activities within the forum state, thus invoking the benefits and protections of its laws". (p.92)

 Minimum contacts may be based on systematic and continuous relationship, or on single substantial contact, but there must
be a purposeful relationship with the forum state, an intentional affiliation.

2. Due Process and Long-Arm Statutes

World-Wide Volkswagen Corp. v. Woodson

 Supreme Court held that Oklahoma had no jurisdiction because foreseeablity is not enough. Quantity as well as quality of the
contacts, only one car it is too much of a stretch to get jurisdiction.

 Forseeabilty question is not whether product will forseeably reach forum state, but whether Defendant’s contacts with the
State are such that it should "reasonably anticipate being haled into court there" (foresee itself being sued there). (p. 98).
 Keeton v. Hustler Magazine: The plaintiff’s lack of contacts with the forum state will not defeat otherwise proper personal
jurisdiction

Kulko v. Superior Court: In order for the defendant to be subject to personal jurisdiction based on an act done outside the
forum state that has effects there, the act mst be “wrongful activity” or “commercial activity” affecting state residents.

Burger King Corp. v. Rudzewicz

 An individuals contract with an out-of-state party alone cannot automatically establish sufficient minium contacts in the other
party’s home forum. The factors of prior negotiations, and contemplated future consequences along with the terms of the
contract and the parties actual course of dealing that must be evaluated in determining whether the defednat purposefully
established minimum contacts.

 Supreme Court: The contract by itself is not enough and needs contacts, and the contacts need to be purposefully
established.

 Two Prong Test: Have to find minimum contacts then the Court must consider burden on the Δ, interests of the forum state,
plaintiff’s interest in obtaining relief, the interstate judicial system interest in obtaining the most efficient resolution, shared
interest of the several states in furthering fundamental substantive social polices. If these things can be found then the
contacts can be more minimal. (pg 109 last paragraph)

Asahi Metal Industry Co. v. Superior Court: Failed to establish minimum contacts if they did find minimum contacts it would fail
the second prong because it was unreasonable to subject a Japanese company to CA jurisdiction.

 Everyone joins in Part I (statement of the facts), Part (II A) O’Connor, Powell, and Scalia (minimum contacts: no minimum
contacts in this case, awareness/foreseeabilty not enough need other things), Part (IIB) O’Connor, Brennan, White, Marshall,
Blackmun, Stevens, Powell, Reinquest even if they did have minimum contacts would not be reasonable because they still
need to look at other factors (burden on the Japanese company) Court must consider burden on the Δ, interests of the forum
state, plaintiff’s interest in obtaining relief, the interstate judicial system interest in obtaining the most efficient resolution,
shared interest of the several states in furthering fundamental substantive social polices. If these things can be found then the
contacts can be more minimal. (pg 109 last paragraph) Part III did not establish minimum contacts so not subject to
jurisdiction

 Dissent Brennan, White, Marshall and Blackum thought that there were minimum contacts agree with parts I (statement of
the facts) and IIB (not reasonable to subject Japan company to CA jurisdiction). Do not agree with IIA (no minimum
contacts) said that they did have minimum contacts because of the foreseeability/awareness of placing the product in the
stream of commerce do not need to add other stuff (i.e. Green paragraph)

 Dissent Stevens, White, Blackum: Part IIB alone requires reversal (unreasonable and unfair to subject Asahi to CA
jurisdiction) so there is no need to even talk about if there are minimum contacts since it fails on the other part.

E. General Jurisdiction and State Long-Arm laws

Perkins v. Benguet Consolidated Mining Co. : If contacts are continuous and systematic then it is ok to have jurisdiction over the
Company. Contacts were continuous and systematic (had an office, files, correspondence, salary checks, meetings, and bank accounts)
so it is not violating federal due process.

Helicopteros Nacionales de Columbia, S.A. v. Hall: If the cause of action does not arise out of or relate to the nonresident defendant’s
activity in the forum state, the defendant cannot be sued there unless there is significant continuous and systematic form activity.

 Justice Brennan believed that if the lawyers of the decedents attached a negligence charge on the piolots then the contacts
would arise out of and relate to the claim
 New Bases of Jurisdiction-technological Contacts
Bellino v. Simon

 No jurisdiction over Mr. Spence because they only had one phone conversation initiated by Mr. Aubert. (his ads in a national
trade magazine was not sufficient because they were maintained by his company not by him personally.) Jurisdiction over
Simon because although in the beginning initated by Mr. Aubert, Mr. Simon’s contacts were more continuous, and on his
website that invited communication (by filling out a form on the web, he invited people to talk to him). Court said that this
was sufficient to establish contacts. Looking at the five factors in the reasonable test (in green) the court said it was. (the
defendant did not show that it would be unreasonable or he would suffer a great burden).

 Sliding scale test: (active, passive, interactive) Active (conducts business over the net) Passive (gives information) Interactive
(exchanges information with a host computer) pg 141

Harris v. Balk: The situs (position or site) of a debt is not the place where the creditor is located, but wherever the debtor may be. The
debt seized was not related to the plaintiff’s cause of action

F. Jurisdiction Based upon Power over Property

Shaffer v. Heitner: changed the rule means that the minimum contacts analysis of personal jurisdiction is now applicable to
quasi in rem and in rem jurisdiction. In this type of quasi in rem where the cause of action is closely related to the property
sequestered (seized) the factual nature of the controversy is likely to provide the necessary minimum contacts among the
forum state, the defendant, and the litigation. In this case the court did not find minimum contacts and held that Delaware did
not have jurisdiction.

In in rem: because the presence of the property within the forum state suggests that there would be other ties among the
defendant, the forum state, and the litigation. Unless there are other contacts with the non -resident there is no jurisdiction.

Jurisdiction based on physical Appearance

Burnham v. Superior Court

 Husband goes to CA to visit his kids and conduct business after dropping off the kids the wife serves him with a CA court
summons. The defendant tries to say that his contacts are not minimum as stated in Shaffer v. Heitner. The court says that
minimum contacts are not needed when served and present in the forum state (it has been that way for over a 100 years).
Other rules are needed to prove consent or presence for an absent defendant.

 Brennan talks about the benefits that someone has when they visit the state (are the minimum contacts) in addition to being
present. Scalia says that minimum contacts are not necessary when present because then when someone were to visit those
minimum contacts (benefits) are then sufficient to be served when you leave. Scalia says fairness exists because of the
continuing tradition. Brennan says that fairness exists by the contacts.

Insurance Corp. Of Ireland v. Compagnie Des Bauxites

 CBG incorporated in DL but principal in Republic of New Guinea purchased insurance from a domestic insurer in Penn. And
from a group of foreign insurance companies through a London brokerage. Sued in Penn foreign insurance companies
contested jurisdiction.
 CBG was trying to get proof of jurisdiction through discovery the insurers did not have the option of blocking the reasonable
attempt of CBG to meet its burden of proof.

Bremen v. Zapata off-shore Co.

  Zapata a Houston based American Co. contracted with a Unterweser a german Co. to move a drilling rig from LA to Italy.
The rig was damaged off of FL. Contract had a provision that all disputes would be litigated in “London court of Justice”.
 Contract had a provision to bring suit in London cannot sue in Florida.

Carnival Cruise Lines, Inc. v. Shute

 Had a provision that all disputes would be litigated in Florida plaintiff tried to sue in Washington (Wash. Resident injured on
the ship). The court said because of the provision it was ok to litigate in Florida because the Cruise had many locales, limits
confusion to what forum to bring suit conserves judicial resources, passengers benefit by having reduced fares.

 Forum selection clauses will be honored unless enforcement is shown by the resisting parties to be unreasonable under the
circumstances.

FEDERAL COURTS

Rule 4K: (1)(A) federal court piggybacks the states long-arm statute Policy issue do not want to give more rights in federal
court Federal JX over the Parties: There is a two step analysis involved for finding federal jurisdiction over the litigating parties: (1)
statutory authority and (2) Constitutional authority under the 5th Amendment.
Rule 4K: (1)(B) parties joined under rules 14 and 19 “100 miles from the place from which the summons issues.
Rule 4K: (1)(C) defendant who is subject to federal interpleader jurisdiction which allows for nationwide service
Rule 4K: (1)(D) is a service rule that the federal court may use when a federal statute authorizes jurisdiction
Rule 4K: (2) limited federal long arm provision applies to defendants whom claims arising under federal law are asserted
when there is no applicable federal process provision and who are not amenable to suit in any one of the fifty states.

• R: The 5th Amendment due process clause has been held to allow a federal court to exercise jurisdiction over a non-resident ∆
if she has the appropriate national contacts (FRCP 4(k)(2)) and when authorized by statute of the United States under rule 4
(k)(1)(d).
• R:Under FRCP 4(k)(1)(A) the π won’t be able to obtain jurisdiction over a resident ∆ in federal court unless she could do so
in local state courts.
Fair notice: Even if a court has authority to judge the dispute between the parties or over the property before it, the court may not
proceed unless ∆ received adequate notice of the case against him. The procedure used must be reasonably calculated to apprise the
parties of the action.

Feasibility of Individual Notice

Alternative means of notice, such as newspaper publication, may satisfy due process where individual notice is impracticable and the
party seeking to bypass individual notice can demonstrate that (1) the suit is in the interest of the absentees, (2) they will be adequately
represented by one before the court, and (3) the value of their individual interests is not too great. Where the identities and parties can
be reasonably ascertained, however, individual notice is required.

Mullane v. Central Hanover Bank & Trust Co.

 The court felt that the banking law was unconstitutional did not have sufficient notice. The statute notice to known
beneficiaries is inadequate, not because it fails to reach everyone but because under the circumstances it is not reasonably
calculated to reach those who could easily be informed by other means (mail). It would not be a burden to have them mail the
notice.

Greene v. Lindsey

 Posting a summons on the door of a tenant’s apartment was not sufficient notice, they should have mailed it as well. Brennan
said that notice provided must be tested with reference to the existence of feasible alternatives.
 O’Connor, Burger, and Rehnquist dissented saying that the mail might fail as well due to loss, misdelivery. Posting notice at
the tenant’s door at least says that the notice got as far as to the tenant’s door.

FRCP 4(d)(2) provides incentives for a defendant to agree to waive formal service and instead accept service by mail. Upon
notice of the commencement of the action and a request for waiver of service from the plaintiff, a defendant who so agrees is
 granted an extended time within which to answer – 60 days instead of the 20 days granted when process is formally served. FRCP
4 imposes upon the defendant “a duty to avoid unnecessary costs of serving the summons,” and therefore, failure to accept
process by mail subjects the defendant to liability for costs of service as well as attorney’s fees incurred in any motion to collect
the costs of service.

Maryland State Firemen’s Association v. Chaves

 Said that the service was not valid under the old rule 4(c)(2)(C)(II) or the new 4(d) because they mailed it 1st class mail not
certified mail as stated in the old rule. In the new rule send notice and a request for waiver of service. If the defendant refuses
to waive service the court imposes the costs on the defendant unless there is good cause. The Maryland rule says that the
notice also needs to be certified mail not the case here so invalid.

Personal Service:
Service By Whom:
Federal Rule 4(c)(2)(A) permits service “by any person who is not a party and is not less than 18 years of age

Service by an Individual
federal Rule 4(d)(1) permits service by: (a) personal delivery(b) abode service, leaving a copy of the summons and process at home or
place of abode (c) to an agent authorized by appointment or by law
Federal Rule 4(c)(2)(C)(i) permits the plaintiff to borrow the forum-state’s methods of service of process
Federal Rule 4(c)(2)(C)(ii) permits mail service to be used but if the defendant does not acknowledge the mail service then follow up
service by another method must be utilized.

Service to a Business Entity

Federal Rule 4(d)(3) permits service by:(a) personal delivery to an officer or a manager or general agent or (b) to an agent authorized
by appointment or by law.
Federal Rule 4(c)(2)(C)(i) Permits borrowing the forum-state’s methods
Federal Rule 4(c)(2)(C)(ii) permits mail service with follow up alternative service required if mail service is not acknowledged

National Equipment Rental, LTD v. Szukehent

 The court decided that Florence Weinberg was their “agent authorized by appointment” to receive process within the meaning
of Federal Rule 4(e)(2). Even though they did not have a personal relationship with her.
 Justice Black dissented because he said it was not fair to appoint Florence Weinberg as their agent (not fair to put that kind of
stuff in contracts) because it will burden people to defend and travel.

State Ex Rel. Sivnksty v. Duffield

 Majority: If in the state voluntarily then jailed you can be served.

 Dissent: voluntary became involuntary because he could not post bail. Not fair to serve incarcerated people.

Wyman v. Newhouse (not on midterm)

 He flew to Florida and when at the airport saw her and her sister and was served with a suit for 500k (promise to marry). A
stranger came upon him happened to be an attorney that knew the case but he decided to go with his own attorney in NY.
 The NY attorney told him to ignore the summons and a default judgment was entered. The appeals court said served by fraud
and lacks jurisdiction makes the judgment null and void.

Fuentes v. Shevin (not on midterm)

 The Supreme Court says that before a provisional remedy (garnishment or attachment) is used to seize property the 14th
amendment requires notice and an opportunity to be heard “at the time when the deprivation can still be prevented”. Ex Parte
provision: there may be cases where a creditor could make a showing of immediate danger that a debtor will destroy or
conceal disputed goods.

Service of process: A case can be dismissed even if jurisdiction is found for the defendant if there is a defect in the service of process.
North Georgia Finishing, Inc. v. DI-Chem, Inc.

 The trial court thought this was different from Fuentes because it was between two corporations. Owed $51,279 and the
Plaintiff got a bond to garnish the bank account and the defendant got a motion to discharge the notice. Still not notice and no
provision for an earlier hearing only requires to file with a clerk stating the amount claimed and reason to apprehend the loss,
bond for double the amount to protect Defendant, and the defendant can dissolve bond if files a bond conditioned for
payment. This does not matter still no notice and no prior hearing not different from Fuentes.

Connecticut v. Doehr

 No notice or hearing or extraordinary circumstances or post of a bond. An assault and battery claim that attached 75 k on the
Defendant’s home. Even though the land was not taken away the credit (title) of the defendant was tarnished and is sufficient
to require prior notice (due process). Violated due process ex parte absent extraordinary circumstances

Richmond Tenants Organization, Inc. v. Kemp

 Evicted drug offenders from public housing immediately without notice and without a hearing. When the action involves the
government less notice and opportunity to be heard is needed.

Opportunity to be heard: Defendant must be given an opportunity to be heard, which must be given to the ∆ before there is a
significant interference with his property rights.

• Weighing Analysis:
1. Interest of property owner (degree of harm)
2. risk of error
3. interest of the party requesting the prejudgment remedy

Defenses to claims of jurisdiction:

• Special appearance: In a special appearance, the ∆ appears in court with the express purpose of contesting jurisdiction. By
making a “special appearance”, the ∆ has not consented to personal jurisdiction. In accordance with rule 12, the objection for
a motion to dismiss suit due to lack of jurisdiction must be made on the first response to the court.
• General Appearance: Can have a general appearance by filing anything other than a special appearance.
• Limited Appearance: file in conjunction quasi in rem jurisdiction appearance is limited to the particular piece of property.
(cannot serve them on another non related suit)
• Collateral attack: A judgment won in one jurisdiction is generally enforceable in another, under the full faith and credit
doctrine. If the action is won as a default judgment in one jurisdiction, the ∆ may collaterally attack the suit in another
jurisdiction on the grounds that the first court had no personal jurisdiction.
• Statute regarding notice is not valid under due process (Mullane).

FRCP 12(g) and 12(h)(1) provide that the following defenses are waived unless they are
asserted in a single pre-answer motion, or, if none is filed, in an answer or reply or any amendment thereto permitted as a matter of
course:
• lack of personal jurisdiction. [FRCP 12(b)(2)]
• improper venue. [FRCP 12(b)(3)]
• insufficiency of process. [FRCP 12(b)(4)]
• insufficiency of service. [FRCP 12(b)(5)]
In contrast, a defense of lack of subject matter jurisdiction [FRCP 12(b)(1)] may be raised at any time, even after the trial. [FRCP
12(h)(3)]

Subject Matter Jurisdiction

I. Subject matter jurisdiction is the authority of a court to hear a particular type of case, as opposed to personal jurisdiction,
which is the authority of a court to hear a case concerning a particular defendant.
II. The constitution allows congress to grant the federal courts much more authority than it actually has. As such, the
question of subject matter jurisdiction in federal courts almost always focuses on statutes, rather than the constitution.
III. Diversity of citizenship
a. 28 U.S.C. § 1332: federal courts have original jurisdiction over cases in which the plaintiff and defendant are
citizens of different states, and the amount in controversy exceeds $75,000.
i. Under Strawbridge v. Curtis, complete diversity is required, meaning that no plaintiff can be a citizen of
the same state as any defendant.
ii. For individuals, citizenship is determined by domicile.
1. Mas v. Perry: “domicile” means living in a place with intent to stay there.
iii. A corporation is a citizen of the state in which it is incorporated, and the state in which it has its principal
place of business.
1. “Principal place of business” – 3 tests
a. “Brain” test: a corporation’s principal place of business is wherever it is headquartered;
where most business decisions are made.
b. “Brawn” test: a corporation’s principal place of business is wherever it engages in the
most activities (sales, manufacturing, etc.)
c. “Holistic” test: a combination of the two tests.
IV. If an unicorporated association is not treated as a citizen for purposes of federal diversity jurisdiction but instead courts
consider the citizenship of each of its members.
V. An alien admitted to the United States for permanent residence shall be deemed a citizen of the state in which such alien
is domiciled. Diversity jurisdiction unaffected by the presence of aliens from the same foreign nation.

i. Amount in controversy - $75,000

1. A.F.A. Tours v. Whitchurch
a. All that is required is that the plaintiff believe in good faith that the damages pleaded are
accurate.
b. To warrant dismissal based on the amount in controversy, the defendant must prove to a
legal certainty that it is less than the required amount.
2. If the defendant pleads the correct amount in controversy, but ends up being awarded less, the
court can, at its discretion, refuse to award costs, or even award costs to the defendant.
Arnold v. Troccoli
i. In a federal court asked for 15k and in a state court originally asked for 6k. Cannot do that did
not have a good reason for the increase.

Zahn v. International Paper Co.

i. The Supreme Court held that only those plaintiffs who individually met the then applicable 10k
jurisdictional amount requirement could be members of the class.
3. Aggregation of claims
a. A single plaintiff may aggregate all claims against a single defendant, and add up the
damages for all of the claims for the purpose of the amount in controversy
b. If suing one defendant for more than 75k, other parties can tag along with related claims
for less than 75k
VI. Federal question
a. 28 U.S.C. § 1331 – the federal district courts have original jurisdiction over any claim arising from the constitution,
laws, or treaties of the United States.
b. In determining what, exactly, is required for a federal question, there are a few tests which may be applied.
i. Osborne v. Bank of The United States (1824)
1. The court granted a temporary injunction restraining the state auditor from collecting tax. The
state auditor forcibly entered the bank and took the money he claimed the state was owed. The
court ordered the state officials to return the money that had been taken from the bank. The only
federal question was that the bank was federal it is too remote for federal jurisdiction.
2. The claim is that the state tax violates the federal state constitution (this really is a federal
question) even though the court says it is not.
c. TB Harms Co. v. Eliscu
i. The fact that a certain property interest is created by federal law does not make all claims related to that
interest federal questions.
ii. In this case, the issue involved a copyright, which is the province of federal law, but the question was over
who had a contractual right to the intellectual property, which is a matter of contract (state) law.
iii. Therefore, there is no federal question.
d. Louisville & Nashville R. Co. v. Mottley
i. Anticipated defenses which rely on federal law do not create a federal question.
ii. A well-pleaded complaint, stripped of all surplusage, must raise an issue of federal law in order to
constitute a federal question.
 e. 2 tests
i. Justice Holmes – “Creation” test
1. For there to be a federal question, federal law must create the cause of action under which the
plaintiff is suing.
2. This test will work 99% of the time, and is quite easy to apply.
ii. Justice Cardozo – “Meaning and Application” test
1. When a state claim raises an issue of federal law, or hinges on the interpretation of a specific
federal law, there is a federal question, if the federal law at issue creates a private right of action.
a. Merrell Dow v. Thompson
i. Using a federal statute as evidence of negligence per se does not raise a federal
question, when that statute creates no private right of action.
2. The test has been somewhat refined
a. Grable & Sons Metal, Inc. v. Darue Engineering and Manufacturing
i. A state law claim hinged on the interpretation of a federal law which did not
create a private right of action.
ii. The Supreme Court found that this is sufficient to raise a federal question if:
1. The claim necessarily raises an issue of federal law
2. Said issue is substantial
3. Exercising jurisdiction over the claim would not upset the balance of
federal and state judicial responsibilities
VII. Supplemental Jurisdiction
a. United Mine Workers v. Gibbs
i. When a claim over which the federal courts have original jurisdiction is brought along with a state law
claim, can the federal courts hear the state law claim?
1. Yes, if the claims all arise out of a common nucleus of operative facts (CNOOF), that is, the exact
same occurrence gave rise to all of the claims.
2. Reasons in Gibbs: If federal claims are dismissed state claims should be as well, if state claims
predominate, whether in terms of proof, of the scope of the issues raised, or the
comprehensiveness of the remedy sought the claims may be dismissed without prejudice (back to
state court). If the state claim is closely tied to federal policy then it should stay in Federal Court.
Diminishing the likelihood of jury confusing that would justify the separation of the claims.

b. 28 U.S.C. § 1367 codified the rule in Gibbs

i. 1367(a)
1. All claims which are so related to a federal question (CNOOF) that they form part of the same
case are subject to federal jurisdiction. This includes claims against other parties.
ii. 1367(b) – when jurisdiction is founded solely on diversity:
1. Adding parties which destroy diversity also destroys supplemental jurisdiction.
c. 1367(c)
i. District courts my, at their discretion, decline supplemental jurisdiction if:
1. The claim raises a novel or complex issue of state law
2. The state claim substantially predominates over the claim over which the federal court has original
jurisdiction
3. The federal court has dismissed all claims over which it had original jurisdiction
4. in exceptional circumstances, there are other compelling reasons to decline jurisdiction
d. 1367 (d)
i. provides a tolling period for SOL for any supplemental claim that is dismissed and for any other claims voluntarily
dismissed at the same time thereafter. Tolling period at least 30 days (more if state law allows) for the
nonsupplemental claims voluntarily dismissed in federal court and refilled in state court.
i. The above list is exhaustive. If none of those features are present, the district court MUST exercise
supplemental jurisdiction.
ii. When additional parties are joined, based on supplemental jurisdiction, only one of them needs to meet the
amount in controversy requirement, if jurisdiction is founded on diversity (Exxon Mobil case).

Ankenbrant v. Richards

 As a matter of judicial economy, state courts are eminently more suited to work of this type then are federal courts, which
lack the close association with the state and local government organizations dedicated to handling issues that arise out of
conflict over divorce, alimony, and child custody decrees. Only exception over a tort action arising out of the domestic
relations.
Marshall v. Marshall

 Bankruptcy court did not have jurisdiction over probate matters it did have jurisdiction over tort action arising out of probate
matters.

e. Counterclaims
i. FRCP 13(a) – compulsory counterclaim
1. If the defendant wants to bring a counterclaim against the plaintiff, and the counterclaim arises out
of the same transaction or occurrence (CNOOF), the defendant MUST bring the counterclaim at
the time of the main claim, or it is waived
ii. FRCP 13(b) – permissive counterclaim
1. If a counterclaim is unrelated to the claim, the defendant may or may not bring it at the time of the
main claim. It is not waived if the defendant does not immediately raise it.

Federal courts § 1312 (d) (1969) which provides that a federal court may retain subject-matter jurisdiction even when the complaint
does not present a claim within its original jurisdiction if defendant introduces a federal defense or counterclaim.

Holmes group Inc. v Vorna Do Circulation Systems, Inc.

 The core of the courts decision as the view that federal law counterclaims cannot form the sole basis for federal question
jurisdiction.

Skelly Oil Co. v. Phillips Petroleum Co.

 Suit was brought under the Declaratory Judgment Act for a declaration that certain contracts had not been terminated. Had
the Plaintiff simply sued to enforce the contract, the complaint would not have raised a federal question. Artful pleading
anticipates a defense based on federal law would contravene the whole trend of jurisdictional legislation by congress.

Smith v. Kansas city Title & Trust Co.

 An example of a claim that although created by state law “arises under” a law of the United States by virtue of requiring a
determination of the meaning or application of such law. Shareholder sued to enjoin the Trust Company, a Missouri Corp.
from investing in certain federal bonds on the ground that the Act Of Congress authorizing their issuance was
unconstitutional. Supreme Court said it was under federal law because the right of relief depended upon the construction or
application of the Constitution or laws of the U.S. , even though it was a state-created cause of action.
 Justice Holmes (professor Kionka agrees) dissented on the ground that the cause of action had been created by state law and
not by federal law so it did not “arise under” federal law.

Moore v. Chesapeake & Ohio Ry. Co.

 Kentucky Employer Liability Act, which provide that the Plaintiff could not be held responsible for contributory negligence
or assumption of risk where his injury resulted from the violation of any state or federal statute enacted for the safety of
employees. (using the federal Safety Appliance Act as a standard of care) Plaintiff alleged that his injury was due the
Defendant’s failure to comply with the Federal Safety Appliance Act. Supreme Court said it was not a federal question
because the central issue of the case was a tort and the standard or care was measured from a federal statute so it was really a
state action.

Shoshone Mining Co. Rutter

 Allowed miners to file patents on their claims and which set up a shceme for settling the conflicting claims of miners. The
federal statute provided that the right to possession was to be determined by the “local customs or rules of miners in the
several mining districts, so far as the same are applicable and not inconsistent with the laws of the United States. This case
arose from a federally created cause of action that turned on issues of state law so no federal jurisdiction.

Luckett v. Delpark, Inc.

  Pantee apparently could have sued for infringement of his patent but chose instead to sue for breach of contract. It was his
choice to bring breach of contract so he did not give federal court jurisdiction of the cause as one arising under the patent
laws.

f. Third-party defendants
i. FRCP 14(a) – when defendant may bring in third party
1. A defendant may bring a suit against a third party who is or may be liable for all or part of the
plaintiff’s claim against the defendant.
2. Third party defendants may then bring counterclaims against the defendant, or the plaintiff
ii. FRCP 14(b) – when plaintiff may bring a third party
1. When a counterclaim is made against a plaintiff, the plaintiff may bring third parties in any way
that a defendant may, unless diversity is destroyed.

Equipment & Erection Co. v. Kroger

 Kroger (citizen of Iowa) brought a suit in a Federal District court of Nebraska based on diversity Citizenship that OPPD
negligent operation of the power line had caused her husband’s death. OPPD in turn filed a third-party complaint against
Owen saying that it was their fault. Plaintiff amended the complaint to name Owen as a defendant. Later found out that Owen
and the Plaintiff were both from Iowa. Could not have originally brought the claim to Federal Court because Owen and
Plaintiff were from the same state (cannot evade the complete diversity requirement by using supplemental jurisdiction).
 Would be alright if the Defendant brought Owen but because the Plaintiff amended the complaint it made it wrong.

Removal

I. 28 U.S.C. § 1441 – statute concerning removal

a. 1441(a) – any claim over which the federal court has original jurisdiction, which is filed in state court, may be
removed, by the defendant (by all defendants, if there are multiple defendants), to the district court sitting in the
same geographic location as the state court in which the action was originally brought.
b. 1441(b) – when jurisdiction is founded solely on diversity, defendants may not remove if they are citizens of the
state in which the action was brought.
c. 1441(c) – when there is a federal question, with unrelated state-law claims joined to it, all claims may be removed to
federal court, and the district court, at its discretion, may remand all claims in which state-law predominates.
d. 1441 also serves as a venue statute. When a case is properly filed in state court, and properly removed to the federal
district court in the same geographic region, that court is automatically the proper venue.
e. When defendant asserts a federal law counterclaim, the plaintiff may not remove (Shamrock Oil v. Sheets).
f. If a plaintiff wants to avoid removal, he cannot amend the complaint to reduce the amount in controversy.
i. If the plaintiff drops all federal claims, the court may, at its discretion, remand to state court.
g. The district court may remand all claims which raise novel and complex issues of state law, when such claims are
joined pursuant to 1367, but it may never remand federal law claims.

Executive Software North America Inc. v. United States District Court for the Central District of California

 The district court did not rely on the supplemental jurisdiction statute, 28 U.S.C.S. § 1367(c), in making its decision and
failed to articulate how the circumstances that warranted declining jurisdiction were exceptional and compelling under the
statute. OUTCOME: The court reversed, holding that the district court clearly erred when it relied on a basis for remanding
pendent state claims that was not permitted by statute and failed to articulate its reasons for remanding the pendent claims.

American Fire & Cas. Co. v. Finn

 The U.S. Supreme Court held that there was no right to removal because the claim against the insurer was not separate and
independent from the claim against the non-diverse codefendant as required under 28 U.S.C.S. § 1441(c). The Court held that
the suit involved a single wrong to the insured. The Court then held that the insurer was not estopped from protesting the
removal action because a lack of party diversity deprived the district court of original jurisdiction over the action..

Borough Of West Mifflin v. Lancaster

 Because the district court had jurisdiction, the action was properly removed from state court under 28 U.S.C.S. § 1441. The
court found that § 1441(c) granted to the district court only limited authority to remand a case, and that respondents' claims
were not separate and independent. The court found that 28 U.S.C.S. § 1367(c) did not sanction the remand of the entire case
because the district court had supplemental jurisdiction over the other claims.
 1441 (c) is unconstitutional – when there is a federal question, with unrelated state-law claims joined to it, all claims may be
removed to federal court, and the district court, at its discretion, may remand all claims in which state-law predominates.

Venue

I. Venue is the place of trial. It is governed by statute.

II. 28 U.S.C. § 1391(a)
a. Applies to cases in which jurisdiction is founded on diversity
b. Civil actions may be brought in a district where:
i. Any defendant resides, if all defendants reside in the same state, or
ii. A substantial part of the events giving rise to the action occurred, or a substantial part of the property which
is the subject of the action is situated, or
iii. Where any defendant is subject to personal jurisdiction, if there is no district where the action might
otherwise be brought.
1. This only applies when the event giving rise to the claim occurs outside the United States, and
there are multiple defendants, all of whom reside in a different state.
III. 1391(b)
a. Applies to cases where jurisdiction is not founded on diversity (federal question)
b. Civil actions may be brought in a district where:
i. Any defendant resides, if all defendants reside in the same state, or
ii. A substantial part of the events giving rise to the action occurred, or a substantial part of the part of the
property which is the subject of the action is situated, or
iii. A judicial district where any defendant may be found, if there is no district where the action may otherwise
be brought.
IV. 1391(c) – a corporate defendant is said to reside in any district in which it is subject to personal jurisdiction.
a. In a state which has more than one district, and in which a corporate defendant is subject to personal jurisdiction, the
corporation resides in any district in that state within which its contacts would be sufficient to subject it to personal
jurisdiction if that district were a separate state.
i. If there is no such district in that state, the corporation is said to reside in the district with which it has the
most significant contacts.
b. Residence, for individuals, is determined by domicile.
c. An alien, under 1391(d) may be sued in any district.

Transfer of Venue

I. Transfer from a proper venue to another proper venue

a. 28 U.S.C. § 1404
i. For the convenience of parties and witnesses, and in the interest of justice, the district court may transfer a
case to any other district in which it might have been brought.
1. Hoffman v. Blaski – where a case “might have been brought” means where the defendant could
have been served, and where there was personal jurisdiction and proper venue.
2. Essentially, where the plaintiff could have brought the action in the first place
ii. Public and private interests are to be considered when determining when transfer is warranted
iii. Private interests
1. Ease of access to proof
2. Ability to compel witnesses to attend
3. Cost of compelling witnesses to attend
4. Access to the site of the accident (if applicable)
5. Any other problems which show a need to transfer
iv. Public interests
1. Administrative difficulties of trial in an inconvenient forum
2. Burden on the community for jury duty
3. Interest in following public proceedings
4. Local interest in local controversies
5. Choice of law issues
 v. State law travels with a case transferred under 1404, but not 1406.

Ferrens v. John Deere Co.

 Plaintiff is a resident of Penn. missed the Statute of Limitations in Penn. so sued in Penn. for contract and warranty claims. In
a second suit he sued for Torts in a Mississippi court and that case was transferred to Penn., but the court refused to use
Mississippi law and dismissed. Supreme court reversed in holding that, in a diversity suit, the transferee forum is required to
apply the law of the transferor court, regardless of who initiates the transfer.
II. Transfer from an improper venue to a proper venue
a. 28 U.S.C. § 1406
i. If an action is brought in an improper venue, the district court shall dismiss, or transfer to a proper venue.
ii. If there is no proper venue in the United States, the case must be dismissed.
b. Any party who wishes to contest venue must do so in a timely manner, or such objection is waived.

Goldlawr, Inc. v. Heiman

 Section 1406 authorizes the transfer of an action even if the transferor court lacks personal jurisdiction. Recognizes that the
interest of justice may require that the complaint not be dismissed but rather that it be transferred in order that the plaintiff not
be penalized.

Forum Non Conveniens

I. Gulf Oil v. Gilbert

a. Factors to include for forum non conveniens
i. Is there an available alternative forum which is more convenient than the current forum?
1. If so, and that forum is within the United States, it may be transferred
2. If not, it must be dismissed
ii. Is the forum selected by the plaintiff prejudicially inconvenient?
iii. Consider the public and private interests
Private
relative ease of access to sources of proof
witnesses
evidence
view of premises and all other practical problems that make trial of a case easy, expeditious and
inexpensive.
Public
congestion of the court
Jury duty is a burden to impose money and time cost to a community that has no relation to the suit
Local interest in having localized controversies decided at home
II. Piper Aircraft v. Reyno
a. If the superior forum is outside the United States, the case must be dismissed.

Choice of law: State law in Federal courts

I. Rules of Decision Act – 28 U.S.C. § 1652

a. The laws of the several states, except when Congress or the Constitution has provided otherwise, are to be applied in
all civil actions where jurisdiction is founded on diversity.
b. This means that in diversity actions, state law is to be the rule of decision, but what type of state law should be
applied?
II. Substantive law: Law which governs how people interact in society (criminal law, tort law, contract law, property law,
etc.)
III. Procedural law: Law which governs how the court system functions, and how disputes are to be resolved in a legal
context (rules of pleading, statutes of limitations, etc.)
IV. Swift v. Tyson
a. Only state statutory law is to be applied in diversity actions.
b. Absent the presence of a state law which is on point, the “general law” (common law) is to be applied.
c. This rule led to forum shopping, and companies would even reincorporate in different states to gain favorable law
for a given suit.
V. Erie Co. v. Tompkins
a. Under Swift, when there is no applicable state statute, the decisional law of the federal courts is to be applied.
b. In this case, there was a direct conflict between state decisional law and federal decisional law.
c. Swift v. Tyson was supposed to create uniformity in the law, which never happened.
d. The general rule from Erie is that federal courts are to apply state substantive law (whether decisional or statutory),
and federal procedural law.
VI. Guaranty Trust Co. v. York
a. Under Erie v. York, all substantive state law is to be applied in federal courts, while applying federal procedural law.
b. This case involved a statute of limitations which would have denied the plaintiff recovery. Should the court apply it?
c. The court decided to apply it, rejecting the distinction between substantive and procedural state law in federal courts.
d. Instead, it focused on whether a law is “outcome determinative”
i. That is, whether the outcome of the case can be significantly affected by the application of, or refusal to
apply, the state rule.
e. This is based on the notion that the outcome of a case heard by a federal court sitting in diversity should be
substantially the same as that of a case heard by the court of the state in which the federal court sits.
f. This decision is designed to eliminate the phenomenon of forum shopping, since the outcome of a case should now
be somewhat the same in federal and state court.
VII. “Outcome determinative” test:
a. Strictly speaking, any state procedural law can be seen as outcome determinative, such as rules related to service of
process, and how complaints need to be filed.
b. However, nobody really thinks that these purely technical rules should be applied in federal courts.
c. So, the de facto test is whether a state rule will encourage forum shopping.
i. Would a party be inclined to choose a different forum based solely on the application or non-application of
this rule?
ii. If so, the state rule is to be applied
iii. If not, the federal rule is applied.
Outcome Not Outcome
Determinative Determinative

Substantive Apply state law Apply state law

Not Substantive Usually apply state law Do not apply state law

VIII. Hanna v. Plummer

a. What if Congress provides for specific procedural rules to be applied in federal courts, as specified by the Rules of
Decision Act?
b. If it is a procedural rule, it is to be applied, since Congress lacks the authority to pass substantive rules of general
application.
c. So, when Congress has passed a procedural law to be applied in federal courts, and such a rule directly conflicts
with a state rule of law, the federal rule should be applied, since it is a case where Congress has “provided
otherwise” pursuant to the Rules of Decision Act.
IX. Walker v. Armco Steel
The Court noted that in diversity actions, Rule 3 governed the date on which various timing requirements of the Federal
Rules began to run, but it did not affect state statutes of limitation. Rule 3 and Okla. Stat. tit. 12, § 97 (1971) therefore
each controlled its own intended sphere of coverage without conflict.
a. Federal rules should be read to comport with their plain meaning.
b. When possible, federal rules should be read narrowly enough that they do not create a conflict with the state rule,
enabling the application of both rules without any problem.
X. Stewart Organization, Inc. v. Ricoh Corp.
The state law controlled the motion and that state law disfavored contractual forum-selection clauses. The Court held that
§ 1404(a) governed the parties' venue dispute. The fed rule was more fair takes into account more factors to determine a
transfer.
a. If a federal statutory rule clashes with a state rule, look at whether the federal rule is constitutionally valid.
b. A federal statute is valid if it is “arguably procedural.”
i. If a good faith argument can be made that a federal statute does not affect any substantive right, the
assumption is that it is procedural, and therefore valid.
XI. “R” and “r” rules.
a. A federal Rule (capital R) is one which is statutory (FRCP or 28 U.S.C.).
i. When there is a conflict between a federal Rule and a state rule (statutory or decisional), the problem is to
be analyzed under Hanna, Walker, and Stewart.
 ii. Ask: is the rule valid?
1. For a federal rule to be valid, it must be arguably procedural.
iii. If the rule is valid, apply it over state law.
b. A federal rule (lowercase r) is one which is decisional.
i. When there is a conflict between a federal decisional rule and a state rule (statutory or decisional), analyze
the problem under Erie and York.
ii. Ask: is the state rule substantive? If yes, apply it.
1. If the state rule is not substantive, ask: is the state rule outcome determinative, and will it
encourage forum shopping? If yes, apply it.