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Subject Matter Jurisdiction

Scenario 1: Case is originally filed in federal district court Basis: Diversity jurisdiction a. How to meet establish requirements of 28 USC 1332 i. Complete diversity rule requires complete diversity between the parties; cannot have the same state on both sides of the suit. See Strawbridge (1806). 1. How to determine citizenship a. If party is a US citizen: i. You start with domicile of your parents. If domiciled separately, then traditionally the domicile of the father. ii. If you move abroad with intent to stay in new country, then your domicile is abroad. b. If party is a resident alien: citizen of whatever state they are domiciled in. c. If party is an alien: domiciled abroad. All aliens are considered to be domiciled in the same foreign country. d. If party is an incorporated business, then citizenship exists in all of the following (1332(c)(1)): i. Every state in which the business is incorporated; and ii. The one principal place of business; the "nerve center," which is "the place where the corporation's officers direct, control, and coordinate the corporation's activities." See The Hertz Corporation v. Friend (2010) e. If party is an unincorporated business, then it has citizenship in every state that a member has citizenship. Includes LLCs. 2. How to change domicile (for citizens of US states); see Mas v. Perry; two requirements: a. Take up new residence; and b. Intend to remain there indefinitely: means no current plans to leave the place at either end of set period of time or upon the occurrence of a particular event 3. Problems a. Alien v. alien (or PRA) is not constitutional, though SCOTUS hasn't ruled on it yet. b. US citizens domiciled abroad can neither sue nor be sued on basis of 1332 c. Stateless aliens can neither sue nor be sued on basis of 1332 1


4. Time period: complete diversity must exist only at time of filing, not at time of incident giving rise to the suit, and not later on in the suit. Amount in controversy > $75,000 1. Determining the amount in controversy: St. Paul Mercury rule a. Prima facie acceptance: The court shall accept the plaintiff's claim so long as it could be awarded by a reasonable jury. b. Evidence or small hearing can be held if the AIC is challenged. c. Grounds for challenge i. No reasonable basis in fact. Facts alleged are too petty to get such a big award. ii. No reasonable basis in law. Plaintiff is asking for punitive damages to meet AIC, but they are barred by state law. 2. Rules for calculating AIC a. Types of relief i. If claim is for damages, are they for more than 75k? ii. If claim is for equitable relief (like injunction), then the majority rule is to use whichever is higher: either the value to the plaintiff or the cost to the defendant of compliance. b. Aggregation rules i. Do not consider counterclaims by def. ii. Single pl w/multi claims v. single def=OK to agg. iii. Single pl v. multi defs=MAYBE. 1. If separate claims=NO agg. 2. If joint tortfeasor where each def can be held liable for > 75k=OK to agg. iv. Multi pl v. single def=MAYBE. 1. If separate claims=NO agg. 2. If plaintiffs have common undivided interests (joint claim)=OK to agg. 3. Penalties for failure to meet AIC a. 1332(b): "the district court may deny costs to the plaintiff and, in addition, may impose costs on the plaintiff." b. Report plaintiff's counsel to the bar (R11 violation) 4. Excluded from determination: costs and accrued interest. 5. Rationale for rule: keep petty things out of the smaller federal court system. 2

b. Sources of law i. Constitutional foundation: Art. III, s. 2 (between citizens of different states, between citizens and aliens) 1. only requires minimal diversity between the parties such that some plaintiff must be diverse from some defendant. Applies in only a few cases, like some class actions and federal interpleader actions. See State Farm Fire & Casualty v. Tashire (1967). ii. Statutory foundation: 28 USC 1332 c. Purposes: i. To protect against local bias ii. To encourage foreign investment Basis: Federal question (arising-under) jurisdiction a. Requirements for federal question J i. Well-pleaded complaint/Mottley rule (See Mottley, 1908): a nonfrivolous issue must appear in a well-pleaded statement of a plaintiff's claim, without consideration of responses to anticipated arguments by the def 1. Holmes's "creation test"/rule of thumb: a. If cause of action comes from fed law (Con., statute, reg), then SMJ b. If cause of action comes from state law, then NO SMJ 2. Exception: if plaintiff has used a state cause of action that is preempted by federal law, then court shall find SMJ (ex: ERISA cases) 3. Rationale: furthers sensible judicial administration by allowing court to determine J at the outset of the case ii. Smith exception (Smith v. Kansas City Title and Trust Co., 1920): if a federal issue is embedded in a state law claim, and is essential to resolution, then fed SMJ exists b. Sources of law i. Constitutional foundation 1. Art. III, s. 2 (all cases arising under the Const, the laws of the US, and treaties) 2. Very broad scope found in Osborn v. Bank of the United States (1824) ii. Statutory foundations 1. 28 USC 1331: same words as the Con., but interpreted much more narrowly. 2. 28 USC 1257: appellate jur for appeals to SCOTUS from highest state courts. 3. Specific statutory authorizations c. Purposes i. Allow federal government to interpret its own law

Prevent states from interpreting federal law to detriment of federal goals Basis: Supplemental jurisdiction a. Requirements i. Independent basis for federal SMJ: one of the claims must have independent basis for SMJ ii. Limitations: problems attaching claims/parties when independent basis for SMJ is 1332. b. Strategy: can help get around AIC and diversity problems. c. Earlier doctrines, superseded by 1367 i. Pendent claim jurisdiction: created to allow in claims that are part of the same "case or controversy" as claims that have independent basis for SMJ. See Gibbs, 1966. ii. Pendent party jurisdiction: created to allow addition of a new party to a claim, without an independent basis for SMJ. iii. Ancillary jurisdiction: created to allow in counterclaims by defendants that could be construed as part of the same "case or controversy." See Moore, 1926. d. Sources of law i. Constitutional foundation: Art. III, s. 2 (cases and controversies with independent basis of SMJ) ii. Statutory foundation: 28 USC 1367 e. Purpose: to allow the most efficient resolution of cases Basis: Exclusive federal jurisdiction a. Intellectual property: patents, copyrights, and trademarks b. Bankruptcy c. Admiralty d. Claims made under federal securities law e. Claims made under anti-trust laws


Scenario 2: Case is removed to federal district court Basis for hearing removed case a. Requirements for removal jurisdiction i. Federal district court had original jurisdiction, 1441(a). Exceptions: 1. In-state defendant rule: if 1332 is basis for removal AND suit is brought in state in which any def is citizen, then removal is barred; 1441(b). Purpose: no outsider bias. 2. If otherwise non-removable claims are joined to claims based on 1331, then the entire case may be removed; 1441(c) c. Preemption: if plaintiff's cause of action is a state claim preempted by a federal law, then case can be removed anyways. ii. Defendants must file notice of removal within 30 days of service on first defendant. Exceptions: 4

a. Defendant unanimity rule: All served defendants must sign off on the removal. b. If plaintiff amends complaint so that it becomes removable, then defs get new 30 day window. c. New defendants added after expiration of time i. Majority/new rule: defendant gets new 30 day window to remove. However, defendants only get a maximum of one year to remove from time state claim commences, unless there is a 1331 claim. ii. Traditional rule: new defendant has waived by proxy if original defs didn't remove. See Nobles. b. Procedural steps to remove i. File notice of removal with appropriate federal district court within 30 days. a. Appropriate federal district court: the court whose district encompasses the lower state court. ii. File copy of notice with state court in which action is pending iii. Give written notice to all adverse parties a. Plaintiff has 30 days from receipt of notice to challenge removal, unless challenging for lack of SMJ, in which case plaintiff has until right before entry of final judgment Blocking removal and getting remand a. Judge's discretion i. If state law predominates, then judge can remand at his discretion; 1441(c) ii. If plaintiff amends complaint to add def(s) who would destroy diversity, then court may deny joinder or remand. 1447(e). b. Attacks on procedure i. Defs failed to remove within 30 days of first def's service. 1441(b). ii. Defs failed to remove within 1 year of commencement of state claim. 1441(b). iii. (Older rule) New defendant has waived right of removal by proxy because original defendants failed to remove within 30 days c. Attacks on SMJ i. Federal court lacks original jurisdiction, plaintiff has until entry of final judgment: no diversity, AIC not met, no federal question. 1447(c). ii. In-state def rule: 1332 was basis for removal and at least one def was from state hearing the case iii. Plaintiff 30 days to move to remand for lack of removability from 1) receipt of notice of removal; or 2) first time at which lack of removability may be ascertained. 1441(b). Any defect other than lack of SMJ, 30 days. 1447(b). Sources of law

a. Constitutional foundation: Art. III, s. 2: if court had original jurisdiction over the suit, then it should be removable b. Statutory foundation: 28 USC 1441, 1446, and 1447

Personal Jurisdiction
State court procedure for determining personal jurisdiction I. Has defendant consented? a. Has defendant expressly consented (waived objection in advance)? i. Does defendant have a forum selection clause in a contract with plaintiff? ii. Did defendant appoint a registered agent to receive process for the company? i. Lower courts are split over whether or not this waives objection because it is often not voluntary. b. Has defendant implied his consent by his conduct in the lawsuit? i. Did defendant appear ordinarily in court without following special court procedures to avoid consenting? ii. Did defendant fail to comply with court orders and thus waive objection via contempt of court? iii. Did defendant fail to object? II. Is there statutory authority? a. What type of statute permits PJ? i. Does statute permit court to go to the limits of the Constitution? ii. Does statute enumerate which acts establish PJ? 1. Are the enumerated acts interpreted broadly? iii. Does the statute enumerate acts but give broad construction instruction? b. Was the defendant (INDIVIDUAL) in the state at time of service, regardless of relationship to purpose of the suit? If yes, then PJ. i. Burnham v. Superior Court of California: custody battle. Mom needs to serve dad in Cali. Dad gets served while visiting the kids. PJ established and upheld. ii. Exceptions to the rule (first two are probably constitutionally required) 1. Defendant's presence was gotten through fraud 2. Defendant's presence was forced 3. (Only in some J's) Defendant's presence was due to subpoena for an unrelated matter III. Is the statutory authority constitutional? a. GENERAL PERSONAL JURISDICTION ANALYSIS i. Does the defendant have his home base in the state? 1. Individuals: is the defendant domiciled in the state? If so, then PJ. 2. Businesses (all) a. Is the business organized under the laws of the state? If so, then PJ. b. Is the state the business's principal place of business? If so, then PJ but a few courts still continue onto the reasonableness test. ii. Does the defendant (BUSINESSES ONLY) do substantial business in the state? (Controversial and disfavored) 1. If yes, then


Some courts stop analysis here but are incorrectly applying Perkins. b. Continue onto five factor reasonableness test. 2. If no, then ??? 3. Perkins v. Benguet Mining Co: company relocated HQ from the Philippines to OH during WWII. Carried on business from there. a. Some courts see Perkins as holding general PJ because it was doing substantial and continuous business in the state b. Some courts (and Saunders) see Perkins as holding general PJ because HQ were in the state iii. If defendant isn't at home in the state, is the exercise of general jurisdiction reasonable? 1. Burden on def 2. Interests of the forum state 3. Plaintiff's interest in obtaining relief 4. Efficiency in interstate judicial system 5. Shared interest of states in furthering social policies SPECIFIC PERSONAL JURISDICTION ANALYSIS i. What are the defendant's contacts with the forum state? ii. Purposeful availment analysis of the minimum contacts 1. Do the ones left show purposeful availment? a. Single and isolated occurrence is not enough; WWV v. Woodson b. The def must take some affirmative act to put it on clear notice and make it foreseeable that it may be sued in the FS i. WWV v. Woodson: Pl. bought car in NY and took it to OK, where it had accident; defs had done nothing to serve the OK market; no PJ c. Don't count contacts that are the result of unilateral actions of a third party i. Hanson v. Denckla: Del. resident created trust at Del. bank; she then moved to FL and died; bank is not subject to PJ in FL d. Were effects of def's conduct targeted at the FS? Calder test for libel (Calder v. Jones found PJ over FL writer and editor of defamatory article where it harmed pl in CA; the publication had wide circulation in CA) i. Could def have anticipated effects of conduct in the FS? ii. Were the harmful effects targeted at the FS? 2. Stream of commerce cases; McIntyre v. Nicastro analysis a. Kennedy (4/9) (same as O'Connor): insertion into SOC + awareness (objective) + conduct targeting market of FS b. Breyer (2/9): uses all of the tests from Asahi v. Superior Court



O'Connor (4/9): PA= insertion into SOC + awareness (objective) + conduct targeting market of FS ii. Brennan (4/9): PA= insertion into SOC + awareness (objective) iii. Stevens (3/9): PA= insertion into SOC + awareness (objective) + sufficient volume/value/hazard c. Ginsburg (3/9): PA= insertion into SOC + conduct targeting the US as a whole 3. Internet cases (Zippo and Revell) a. Is the website interactive or passive? Pure passive sites don't count. (Zippo scale) b. If at all interactive, then does the website target the FS in particular? If not, then website doesn't count. i. Revell v. Lidov: defamatory article written in and published onto general forum in NY; author sued in TX; held: no PJ in TX Relationship between the claims and the contacts: do claims arise out or are sufficiently related to the contacts?


1. Arises out of, directly or indirectly a. Use the but-for test: but for the contact, would the claim exist? b. When contact between def and FS is minimal, claim must arise directly out of the contact i. McGee v. International Life Ins. Co.: CA resident had life insurance policy with TX company, whom he sent his payments; def had not solicited business in CA because it had bought an AZ co.; contact was sufficient for PJ ii. Keeton v. Hustler: NY residents sues in NH because only place statute of limitations was still open; held: claim arose directly out of def's publishing activities in the FS, and NH had interest in allowing the suit 9

2. Sufficiently related to: does the claim look like something the def would expect to defend given its contacts with the FS? a. Conditions: 1) but-for test failed; and 2) claims are more than minimal iv. Asahi reasonableness test: if there is both purposeful availment and relation between contacts and claims, then is PJ reasonable? 1. Asahi v. Superior Court found unreasonableness of specific IPJ despite case passing first two tests (dispute between two foreign defendants) 2. Typical use: foreign defendants whose actions create no real connection to forum state. 3. Factors: a. Burden on def b. Interests of the forum state c. Plaintiff's interest in obtaining relief d. Efficiency in interstate judicial system e. Shared interest of states in furthering social policies (no real use) Federal Court procedure I. Was service of process sufficient? II. Is there statutory authority? a. Is there federal statutory authority? i. Is this a state law claim? 1. 4(k)(1)(A): is the defendant subject to the jurisdiction of a court of general jurisdiction in the state where the district court is located? a. Is the exercise of PJ consistent with the due process clause of the 14th amendment? DO STATE COURT ANALYSIS 2. 4(k)(1)(B): was the defendant joined per Rules 14 or 19 and served within 100 miles of the court house? 3. 4(k)(1)(C): is PJ authorized by a federal statute? ii. Is this a federal law claim? 1. 4(k)(1)(C): is PJ authorized by a federal statute? 2. 4(k)(2): a. Claim must arise under federal law b. Def must be not be subject to jurisdiction in any state court III. Is the exercise of PJ constitutional under the due process clause of the 5th Amendment? a. Is def a US company/US citizen? i. If yes, then general jurisdiction b. Is def a foreign company or foreign citizen? i. Majority view: Def needs only minimum contacts with entire US ii. Minority view: Def needs both minimum contacts with entire US + minimum contacts with the federal judicial district in which case is brought

I. Picking the right venue 10


Suit originally filed in federal court, 1391 i. SMJ=only diversity, 1391(a) 1. 1391(a)(1): Venue=proper, if brought in a district where any defendant resides, if all defendants reside in the same state a. Natural person defendant i. Majority rule: def resides in the judicial district of his domicile (only resides in one district at a time) ii. Minority rule #1: def resides wherever he has a residence (multiple residences possible) iii. Minority rule #2 (emerging): takes the best from both tests?? b. Collective defendants (corps., ass'ns), 1391(c) i. General rule: any judicial district where def is subject to PJ at time complaint filed ii. Single district states: def resides in the entire state iii. Multi-district states: (1) in a district with sufficient contacts for PJ in that district; or (2) in the district where def has the most contacts 2. 1391(a)(2): Venue=proper, if brought in district with substantial part of events, omissions, or property in dispute is located a. Verbatim: "a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated" 3. 1391(a)(3), [FALLBACK PROVISION]: Venue=proper, if def subject to PJ in district at time of complaint AND there's nowhere else the action may be brought ii. SMJ=not diversity, 1391(b)=(a): same analysis as SMJ=only diversity 1. 1391(b)(1), district where any defendant resides, if all defendants reside in the same state 2. 1391(b)(2), substantial part of events, omissions, or property in dispute is located 3. 1391(b)(3), FALLBACK PROVISION iii. Exceptions to the general rule 1. Local action rules: special rules requiring disputes over property be brought in district where the property is located 2. Forum selection clauses: not a guarantee for venue, but courts usually give them great weight 3. Statutory venue provisions: may add or subtract proper venues 4. Aliens: no venue protections, 1391(d) b. Suit removed to federal court: venue=proper, if removed to district court for the district that encompasses the state courthouse Transfer and dismissal scenarios a. When venue was proper i. Dismissal: forum non conveniens




Transfer: 1404(a), "for the convenience of parties and witnesses, in the interest of justice" 1. Alternate forum: must be a venue in which plaintiff could have originally brought suit; Hoffman 2. Court can transfer sua sponte 3. District court judge has broad discretion whether or not to transfer 4. Judge may transfer even without PJ over def; Goldlawr 5. If party objects to transfer/non-transfer: party must wait until entry of final judgment to appeal decision; reversal only for abuse of discretion (hard) 6. Choice of law: a. if transferor court had PJ, then substantive law travels with the case (Van Dusen) b. if transferor court didn't have PJ, then substantive law doesn't travel with the case b. When venue was improper i. Dismissal: almost never granted for improper venue; but may be brought under 1406(a) or 12(b)(3) ii. Transfer: 1406(a), "if it be in the interest of justice" 1. Alternate forum: must be a venue in which plaintiff could have originally brought suit; Hoffman 2. Judge may transfer even without PJ over def; Goldlawr 3. If party objects to transfer/non-transfer: party must wait until entry of final judgment to appeal decision; reversal only for abuse of discretion (hard) 4. Choice of law: substantive law doesn't travel Dismissal for improper venue a. 12(b)(3) b. Forum non conveniens (common law doctrine) i. Choice of law: substantive law doesn't travel because of dismissal ii. Standard of review: party must show judge abused discretion iii. When used 1. In federal court: to allow suit to be litigated in foreign courts 2. In state court: to allow suit to be litigated in foreign courts, federal courts, or another state's courts iv. Two prong test 1. Adequate alternative forum exists a. Alternative forum in a different judicial system b. Alternative forum must provide some remedy to pl c. Alternative forum need not favor the plaintiff; Piper d. Dismissal may be conditioned upon suit in alternative forum; def waives PJ and statute of limitations if it fails to subject itself to alternative forum 2. Balance of conveniences favors the alternative forum (Gilbert factors) a. Private factors (private interests of litigants) 12



Relative ease of access to sources of proof Availability of compulsory process for attendance of unwilling witnesses iii. The cost of obtaining attendance of willing witnesses iv. Possibility of view of premises, if view would be appropriate to the action v. All other practical problems that make trial of a case easy, expeditious, and inexpensive Public factors i. Administrative difficulties flowing from court congestion ii. Local interest in having localized controversies decided at home iii. Interest in having the trial of a diversity case in a forum that is at home with the law that must govern the action iv. Avoidance of unnecessary problems in conflict of laws, or in the application of foreign law v. Unfairness of burdening citizens in an unrelated forum with jury duty

i. ii.