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October 2, 2008

For make-up class tomorrow, be prepared to discuss practice exercise 16 (10:30 am JG103)

Starbucks hypo: (vs. Coffee Contractors general contractors who subcontracted flooringto Cemento)

- Rule 14: CC can implead Cemento if CC has a theory of liability that Cemento may beliable to CC for what CC owes to Starbucks (CC = 3rd party plaintiff, Cemento = 3rdparty defendant) if Cemento brings someone else in, it becomes 4th party plaintiff

- CC has 10 days after serving original answer to Starbucks to implead Cementowithout leave of court 14(a)(1)

o Besides an original answer, defendant could file amended answer (Rule 15)o If CC files 12(b)(6) motion, it doesnt trigger the 10-day time frame (motion,

not a pleading)o If after 10 days, defendant can file motion to implead a third party rule

doesnt offer clear standard for whether court can allow for this- if CC impleads third party, process is like starting a whole new lawsuit: Cemento

must consider Rule 12 defenses, filing cross-claims and counterclaims as a newdefendant in a lawsuit

- theory of derivative liability Cemento failed to perform properly according to itscontract with CC; CC has a claim against Cemento for all or part of what it will oweStarbucks

o indemnification one party gives security to another party if the other partysuffers a loss/injury; subcontractor agreements typically containindemnification provisions, also employer-employee

o subrogation one party steps into the shoes of another if the other partysuffers a loss/injury (ie. insurance companies)

o contribution (ie. contributory negligence) A and B are both responsible tosome degree for Cs injury or loss contribution law allows one tortfeasor torecover from another, one defendant has to contribute to what the otherdefendant owes to the plaintiff 3rd party liability is dependent on a judgment against the original defendant

- CC is not required to bring its indemnification claim against cemento at this point,can bring lawsuit against cemento later defendants not required to bring in a thirdparty at time of suit

- Cemento can bring claim against Starbucks for stealing construction helmets 14(a)(2)(D) include claim here, dont risk a court later deciding that the claim was

part of the construction litigationo may, notmust no direct connection between Starbucks and Cemento,

court will not force Cemento and Starbucks into adverse situations (vs. Rule18 where once parties are adverse, they must bring all claims orcounterclaims)

o if Cemento brings the claim, Starbucks must assert Rule 12 defenses or bringmotion to dismiss; starbucks must also assertcompulsory counterclaimsb/c parties are now adversarial (Rule 18)

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- Rule 14(a)(2)(C) cemento may assert against Starbucks any defense that wouldcontribute to CCs defense against Starbucks claim

- Rule 13 counterclaims are compulsory when they arise from the same transactionor occurrence; if you choose not to bring a compulsory claim, its permanentlywaived

o Strategic consideration: bring all claims b/c theres greater likelihood of afavorable settlement (most corporate litigation settles out of court)New hypo: Starbucks sues Cemento directly; can Cemento implead Countertops inc. (itsnot us, its their fault) not a good impleader because no derivative liability, norelationship between Countertops and Cemento that would implicate Countertops in anyliability they may have to Starbucks; impleader is not a defense.

Impleader vs. relation back (rule 15) in derivative liability cases, statute of limitationsdoesnt really come into play

Gross v. Hanover3 theories for derivative liability Hanover moves to implead Rizzo Brothers

- Joseph was negligent in securing the goods- Joseph was involved in stealing the goods- Anthony was negligent in hiring Joseph

court has discretion to grant motions for impleader court will balance benefits ofallowing impleader vs. prejudice to plaintiff or 3rd party defendants;

- court allows this impleader here because the same transaction and set of facts apply,more efficient to deal with both here

- Plaintiffs argue against allowing impleader b/c case will become more complicatedand slower higher attorney fees; Gross asks that Hanover sue Rizzo later for

indemnification- Rule 14(a)(1) impleader does not have to rest on an iron-clad claim of liability,

rule allows for third parties who may be liable

DISCOVERY

The next step of trial after complaint-answer (12b motions to dismiss denied)- lack of coherence to the rules? Frequent amendments- current atmosphere skepticism about the value of discovery but acceptance of its

place in litigation process

- why discovery? Reduces chances of trial by ambush; promote settlement when eachside has a more realistic picture of the other sides case; reduces drain of resourceson courts because parties can narrow the scope of their disputes, but also maycreate new disputes (motions for leave to amend pleading, relation back rule not toocomplicated when only adding new claim arising from the same transaction)

- most cases involve minimal discoveryRule 26 Rule 37 (bookends for discovery rules)

- submit discovery plan to court in anticipation of rule 26 conference

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- Schollansky v. Ronan, Schollansky must turn over to Ronan the following:o Rule 26(a)(1) initial disclosures; 26(a)(1)(ii) required initial disclosures

only include documents that support partys defenses, not info that wouldhurt the partys case will eventually have to turn over a harmful documentupon request later, but not during initial disclosure phase

- 3 phases of disclosure initial, expert, pre-trial disclosure (Rule 26(a)(1-3))o experts: experts written report turned over to the other side, other side will

find contradicting opinions and for preparing deposition questions initialdisclosures provide the basis for further discovery

o expert disclosure indicate how much the expert is being paido pretrial disclosure of witnesses and exhibits other side cant directly

contact other sides witness- tools of discovery:

o required disclosureso depositions flexible, allows follow-up questions, spontaneous (down side

can become very expensive)

o interrogatorieso producing document/objectso physical/mental examso requests for admissionso informal discovery internet searches, talking to other lawyers, private

investigators protective order under Rule 26(c)

Rule 30(b)(6) subpoena asking for an expert or definitive person to depose (preventswaffling)

Transnational litigation: unique American context where regulatory action happens

through civil litigation; in other countries where there is less discovery, there are differentregulatory initiatives (ie. state may be more involved) e.g. Germany gives fact-finding jobto the court who decides what experts/witness/facts are relevant for trial

Moss v. Blue Cross- defendant typically objects to every single interrogatory when drafting

interrogatories, think about avoiding these objections (clear language,time/duration); too many objections may be seen in bad faith and defendant couldbe sanctioned

October 3, 2008

E-discovery:- procedure is trans-substantive and applies to all sizes of litigation problem with e-

discovery, still a work in progress re: limitations or regulations- costs and difficulties associated with e-discovery are quite different from other

types of discovery

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- expenses E-D more involved and more expensive than ordinary discovery, verydifficult and highly technical process who pays?

o In regular discovery, defendant pays for disclosure in response to plaintiffsrequests and vice-versa; default rule - each side pays for its own discovery

o Default presumption of each side paying for its own discovery does notcarry over to E-D

o Quiby v. WestLB: how to you assess the burden of discovery and figure outwho pays for it? (Zubulake v. UBS Warburg test is key for e-discovery) 7factor test (p.395 CB) balancing costs, benefits and alternative routes of info-gathering many of these factors can also be applied to regular discovery,but not applied by default

cost-shifting may apply (would NOT apply to regular discovery)Teague v. TargetClaim: plaintiff files complaint alleging unfair dismissal due to discriminationMitigation principle: to rule out contributory actions, old computer data was crucial to

show that she made a serious effort to find another job (mitigation evidence); very little ofher job search was done through formal systems where there is a better record.

Defendants: spoliation of evidence plaintiff did not take adequate care in preserving theevidence and should have known that the old computer data court agrees and sanctionsplaintiff by giving adverse inference instruction to the jury who can conclude that plaintiffmay not have the evidence she claims to have

- worse than a monetary sanction b/c it dramatically decreases chances for recoveryof damages

Hickman v. Taylor (1947, 9 years after adoption of FRCP)

Facts: tugboat sinks and counsel for tugboat company interviews witnesses and survivorsbefore any actions are initiated.

Issue: does tugboat lawyer have to turn over to the plaintiff his work product createdbefore the litigation started.

SCOTUS analysis: discovery intended to fill the gap between the complaint (short and clearstatement) and the conclusion of the trial; ruled that tugboat lawyer did not have to turnover the statements.

- lawyer of the plaintiffs could depose the witnesses and find the same evidence thatthe tugboat lawyers have

- the work product of tugboat lawyer is the result of his thinking and his ideas,represents what he thinks is important the interview statement reflects the mentalimpressions of the lawyer, not just the particular words of the witness or survivor

o work product: work a lawyer does in assembling information and filteringout what he believes to be important in anticipation of forming a legalargument or advancing a theory of liability (tangible and intangible ways inwhich the lawyer process info in the clients interest)

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- point of discovery is to reveal the truth, not to allow one side to hide from the other maximize the exposure of the various versions of the truth in order to come to theright conclusion

- court believes that forcing tugboat lawyer to turn over work product will have anegative effect on the practice (ie. stop writing things down)

- multiple goals should be served by the adversarial litigation system: the lawyers jobis to protect the clients interests; by forcing lawyer to turn over work productwould go against this

- accepting lawyers work product as evidence would turn the lawyer into a witness(not his professional role)

- attorney-client privilege only extends to clients, not to the witnesses or survivorsthat the lawyers interview

Tools for limiting discovery:- protective orders- sanctions- rules

Ethics Scenario (p.386)- possibility to directly contacting the other side to request more reasonable demand

for document production- most lawyers will not want to turn over papers to an adversary without first

reviewing them- redact/remove confidential info or request courts protective order to ensure that

the info is not made public not necessarily effective b/c order is a piece of paperand seeking legal remedy for violating protective order requires even moreexpenses

- risk of objecting to requests as overly broad and burdensome rules afford a largedegree of latitude for discovering relevant info

Pros and Cons of discovery: (Brazil and Keith critiques of discovery vs. Landsman)- cons: system design argument (adversarial system not conducive to truth-finding,

different goals and incentives); comparative argument (other judicial systemsfunction without having an expansive scope of discovery) an administrativesolution? Placing responsibility on the govt rather than on private attorneygenerals; rules were originally designed to streamline litigation process butdiscovery allows for both parties to abuse the system (maybe we shouldnt havenotice pleading?)

- pros: discovery not used often, why take away that option? Costs of discoverygenerally commensurate with the costs at issue in the trial; individual initiative andincreased legitimacy of the system by having regulations and limitations come fromthe people rather than from the government country founded on skepticism ofgovt and encouraging people to challenge the govt;

October 7

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Two days on summary judgment (Oct. 9, Oct. 10)

Complaint answer (compulsive/permissive counterclaims, implead 3rd parties)^ dispositive motions (ie. 12b)

discovery (chance for another dispositive motion, Rule 56 motion for summary

judgment) trial post-trial motions appeal

*good time to read Buffalo Creek*How do you get a trial? What role do trials play in the litigation process?

Juries:Chauffeurs, Teamsters and Helpers v. Terry

- no majority opinion on PartIII(A)- truckers file a claim against the truck company (unfair firing) and the union (failure

to represent their interests) seek permanent injunction and monetary damageso trucking company goes bankrupt, all claims against it voluntarily dropped, no

further need for injunctive relief;- court: to get money damages, plaintiffs must make case under Section 301 of Labor

Management Relations Act for a claim of breach of fair representation duty, prove(1) breach of collective bargaining agreements and (2) breach of duty of fairrepresentation

o without breach of collective bargaining, there is no provable injury- at issue in the case is whether P has a right to a jury trial (7th Amend applicable?)

o text: in suits at common law, where the value of the controversy shallexceed 20 dollars, the right of trial by jury shall be preserved

suits at common law does not generally cover equitable forms ofrelief (leftover from writ pleading history)

- 2-piece framework to address this problem:o (1) 1791 comparison of whether the present action would fall into equity

or law (examine historical cases) preserved: right to jury trial carried down from enactment of 7th

Amend courts must look to the time when the text took effecto (2) nature of the remedy sought (remedy at law or in equity?)

- fair representation: when there is an exclusive representative for a group of works,the rep must represent the interests of all the workers fairly

o Ds analogies both are in equity, no jury trial; P proposes malpracticeanalogy relief in law Court accepts trustee analogy

- breach of collective bargaining agreement: legal claim- remedy: money damages legal- holding: on balance, this is a claim at law and entitled to a jury trial

o fact that a party is seeking money damages is not sufficient to guarantee jurytrial

o money damages not considered restitution (equitable damages) because theunion wasnt holding the money

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- Brennan concurring: if everyone agrees that nature of the remedy is moreimportant, why look at the history? Judges not qualified to draw proper analogies toold writs of action

- Kennedy dissent: preserved in 7th Amend instructs judges not to skip over thehistory; judges cant pretend that they dont have a preservation job which requires

them to do historical work;o Majority made a mistake breaking out the trust analogy and (?) court must

look at the nature of the overall action (breach of duty of fair representation)rather than at the individual elements of the claim; if looking at the overallaction, falls in equity (trust analogy applies)

- if you have a legal and an equity remedy, you are entitled to a jury trial for your legalclaim (court can sever the two and put one before the jury) practically, efficiencyconcerns push for trying the equity and legal claims together and jury decides oneclaim, the judge decides the other (or you get two separate trials)

City of Cleveland firefighters gender discrimination claim:

Prove: (1) intentional discrimination based on sex; (2) statistical info to show thatdesigners of the test should have understood the result of the test (excluding women) andwritten a better test (to make room for women in the dept)

- P arguments against jury trial:o Jury biaso Jurys fears, protectiono Subtle argument, difficult for jury to sort out?o Manipulating jury poolo Judges record allows you to predict outcome of trialo Resources needed to proceed with jury trial city in a better position to take

advantage?

o Jury prone to influence by lawyerso Emotional susceptibilityo Judge better able to separate facts and lawo Judge required to give reasons for his judgment, juries are noto Bad group dynamicso Different points of view

- P arguments for jury trial:o Judges personal biaso Manipulation of jury pool can go either wayo Jury may disregard precedent or law (does not sense itself as being bound

the way the judge would be)o Familiar controversy unfair testso Social pressures of group setting no comfortable expressing or acting on

personal biaso Mock jury testing outcome may be more predictableo More leverage for settlemento Accountability and transparency

JCPenny Review Question 1

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- State the standard of review: court must take all of plaintiffs allegations to be trueand draw all reasonable inferences from them;

- Make general remark about 12(b)(6) standard relatively low threshold, althoughits unsettled and in transition;

- Cite the rule: rule 8(a) standard; discuss Conley (traditionally loose standardappears beyond doubtno set of facts; can also mention Dioguardi) andBellAtlantic re-interprets Conley rule (plausibility) discuss the meaning/possibleinterpretations of plausibility

o APPLY THE LAW TO THE FACTSo Relationship b/w Bell Atlantic and Conley (and how does this affect this

case?) controversy, is Bell Atlantic restricted to anti-trust? Does BellAtlantic totally over-rule Conley?

Most cases will satisfy both Conley and Bell Atlantic- Context of federal rules shift from writ pleading to notice pleading- We care about notice because of due process

Application:

- P must allege enough facts to state a possible malicious prosecution claimo (1) termination of criminal proceeding in Ps favor facts satisfy this element

because she was acquitted of the bad-check chargeo (2) lack of probable cause for the criminal charges look at footnote re:

probable cause for bad-check statute facts show that P did not write thecheck knowing it would not be honored by the drawee (she intentionallycancelled the check afterwards)

two presumptions for bad-check: issuer is presumed to know that thecheck would not be paid if (1) issuer had no account with drawee attime of issuance and (2) payment was refused by drawee b/c of lackof funds and issuer failed to make good within 10 days of refusal

statues definition of probably cause does Ps facts meet thisstandard?

o (3) element of malice see statutes definition of malice and see if theresanything in the facts to support the claim

October 10, 2008

Summary Judgment (continued)- a procedural device that allows courts to adjudicate cases before a full blown trial;

SJ allows court to decide a case when there are no facts in dispute (genuine disputes

material to elements of Ps claim)- cross-motions in summary judgment occurs when both parties admit no facts in

dispute (vs. usual context where one party believes no dispute of facts and non-moving party believes there is a dispute to be decided at trial)

Celotex v. Catrett- what must the moving party show before burden of proof is shifted to the moving

party in deciding SJ?

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o Motion for SJ brief + statement of uncontested factso Opposition to motion brief + material supporting contested factso Reply brief + more documentation to rebut opposing partys argumentso Judge evaluates and adjudicates

- 1stquestion: has the moving party done enough in motion for SJ to shift the burdento the nonmoving party?

o Then, did nonmoving party sufficiently rebut?o If sufficient, was moving partys reply sufficient?

- what does Celotex need to do in order to make the court look at non-moving partysrebuttal

- Rehnquist vs. White vs. Brennan interpretation of moving partys burdeno Celotex: Catrett did not show enough evidence that her husband was exposed

to Celotex asbestoso Rehnquist: Celotex has done enough if moving party does not bear the

burden at trial, it does not need to create its own evidence, but its notenough to simply say that there is no proof;

o White: elaborates on Rehnquist opinion Celotex has done enough, butgenerally, moving party must support the motion (Rule 56(c) types ofevidence admissible in support of SJ motion)

o Brennan critique: majority has not specified whatenough is Agrees with Rehnquists rule, but that Celotex has not met its burden

- is the evidence in this case of a sufficient form to require that Celotex respond to it?o If Ps evidence inadmissible at trial, P still has nothing to prove her case

- lack of amicus briefs imply that people generally didnt think that standard for SJwould be changed as the outcome

- SCOTUS msg to public: SJ is not a disfavored shortcut, encourages lower courts touse this device to dispose of cases when its appropriate

o Has the definition of what is appropriate changed since Celotex?Notes:1. conflicting burdens of persuasion?

- Catrett bears burden of proof at trial how does Celotex show that she has not orcannot achieve this?

- Evidence must be read in the light most favorable to plaintiff2. admissibility of evidence?- P has to be able to show that it would have admissible evidence to avoid SJ- Rule 56(c) allows for affidavits, documents, admissions, etc. affidavits generally notadmissible at trial b/c they are sworn statements w/o opportunity for the other side to

cross-examine- handout p.355 (Shapiro article) why didnt Celotex depose Hoff?-**to meets its burden, Celotex has to show that the evidence on the record does NOT showthat P has a sufficient claim

Anderson v. Liberty Lobby- P brings libel case has to prove that libeling party acted with conscious malice; D

moves for SJ arguing that P has no evidence proving actual malice

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- Court: P must have evidence to show actual malice that a reasonable jury would findconvincing (legally sufficient evidence)

o If not legally sufficient evidence, court should grant motion for judgment as amatter of law (no dispute as to material facts)

o Majority grants SJ: role of judge is to evaluate legal sufficiency of the factso Dissent: judge is usurping the power of the jury by weighing the facts(whether D acted intentionally a fact-finding jury function)

Matsushita v. Zenith- Ps claim based on expert opinion re: business practices of D

o D would have received Ps export report as part of discovery; then wouldveevaluated it with their own expert and rebut the theory; depose expert, etc.

D includes findings from above into SJ motion in arguing that there isno basis for Ps claim or negate Ps evidence

- Court: Ps theory is implausible, grants SJ motion b/c jury could not possiblyconclude in the plaintiffs favor notlegally sufficient

- Dissent: court is acting in place of the jury, weighing their own economicinterpretation jurys job to evaluate plausibility of the experts theoryScott v. Harris

- Scalia: videotape does not need to be turned over to a fact-finding jury; court mustfirst evaluate video for legal sufficiency (did the policeman act reasonably)

- Stevens: court is improperly taking on the role of the jury by interpreting theevidence if two judges can view the video and come to different conclusions, thecase should be put before a jury

**7th Amendment rights, due process rights vs. efficient use of judicial resources theres

no cost free choice**

October 15, 20082nd review question due a week from Friday

Judgment as a matter of law- ways in which judge takes away decision-making power from the jury jury has

participated in the case, but their thoughts may or may not have an effect on thecase

- judges device for efficient treatment of case or control of the jury- Rule 50(a) vs. Rule 52(c)

o Rule 50 (for jury trials) focused on the burden of production (has the non-moving party produced enough legally sufficient evidence) vs. Rule 52(c)finds against a party on an issue when legally sufficient evidence is notpersuasive (bench trial where judge is acting as fact-finder) party hasntmetburden of persuasion

if burden of production (legal sufficiency question) is not met, burdenof persuasion cannot be met (credibility of facts presented)

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in rule 50, judge determines legal sufficiency; the jury thendetermines the persuasiveness of the evidence presented

in rule 52(c), if judge finds against party on an essential element of theclaim, judge has the option of entering a judgment or letting the trialplay out

y judges interest in allowing the trial to play out if judgmenton partial findings is overturned on appeal, judge does notwant to have to retry entire case (vs. efficient use of courtsresources and possible prejudice to moving party)

**should judges have this much control over juries?Trial Ps evidence judgment as a matter of law Ds evidence renewed motion

for judgment as a matter of law case turned over to jury judgment as a matter of law- what then is the value of having a jury?

o Jury as leverage for settlement negotiations**role of procedure what role do post-trial motions play?

p.541 practice exercise no.24- motion for judgment as a matter of law does not apply b/c we dont want court tooverturn the verdict- Rule 59: motion for a new trial (1) judges error in admitting irrelevant (or highlyinflammatory/prejudicial) evidence; (2) legal error in the amount of the jury verdictbecause evidence suggests a much higher verdict than found here, verdict tainted byprejudicial evidence

- to get higher judgment, request new trial and hope that judge gives additur- risk: new trial would be focused on damages (bifurcated trial) unable to show

Dinkins in the most sympathetic light for damages, loses opportunity to tell a story andframing the facts through testimony

- Rule 60 cannot be used to persuade judge to grant more damages- Rule 59 motion to alter or amend the judgment 7th amend prevents judge from adding toverdict w/o going through the jury

7th amendment concern:- remittitur is reducing judgment to what was already found by the jury (jury clearly

found enough facts to justify a greater verdict)- additur is going beyond the verdict found by the jury

Remittitur:Hypo: jury finds $1mil verdict, judge finds that 750k is the highest acceptable

verdict, 500k is more reasonable, 250k is the lowest acceptable limit

- judges remittitur for 750k shows the maximum amount of deference to the jurysdecision

Rule 60- vacate judgment becomes null and void, unenforceable- rule vs. standard issue: strict 1 year deadline to file several of the rule 60 motions

(you can only extend time period for weekends and holidays when youre operatingunder a short time limit)

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- does rule 60 destabilize the system?Jury verdicts (1) general verdict (we find defendant liable for x amount); (2) specialverdict (jury finds on the facts, judge determines matter of law); (3) general verdict withanswers to interrogatories (combines elements of 1 and 2, good way for judge to give jury

better directions; plaintiff risks losing holistic finding on the overall facts of the case)

Bifurcation and trifurcation:- bifurcation: liability and damages- trifurcation: causation, liability and damages- severance (when you take a party or a claim out of the trial) is different separating

claims or parties for separate trials to avoid prejudice or over-complex trials- individual cases vs. class action suits (pros and cons of bifurcation?)

October 16, 2008 (no class next Wednesday, make-up on Friday)Questioning the adversarial system, and ADR

- globalization and convergence of different systemsLuban:

- no better alternative- consequentialist (instrumentalist) arguments

o trutho ethical and sensible division of laboro best way to defend legal rightso checks and balance against govt power (especially the judicial power)

- non-consequential arguments (dignitary) the system is a good in and of itselfo intrinsic good in having a special purpose friendo human dignity value giving a voice to individualso social fabric embedded social practice part of cultural identity

German system:- different fee structure (set by law)- court selects its own experts- different role of lawyers

o lawyers allegiance: primary loyalty is to the courto limited interaction with witnesses

- lack of jury in civil litigation- law is statutory- discovery process managed/led by the court

ADR- courts may or may not order parties to submit to mediation depending on local

statuteso tension: mediation in good faith vs. being ordered to attend

- fiske: against settlement

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o precedent is the value of litigation guides future behavior and builds uplegal system; informal settlement means less capital in the legal system andthat the precedents we do have are not representative of the majority ofcases

- managerial judgingo tied to rule 16 and discovery rules

October 23, 2008 Personal jurisdiction

International Shoe Co. v. State of Washington- vs. Pennoyers physical presence rule (defendant or his property had to be

physically within the jurisdiction of the forum state) Harris and Hess cases try to reworkthis rule to adapt to booming interstate economy

o to contest jurisdiction 12(b)(2) motion to dismiss for lack of jurisdiction,make a special appearance to contest (direct attack) or default and challenge

when court goes to enforcement the judgment (collateral attack)o risk in collateral attack all or nothing; defaulting waives all other defenses,

take the risk that a valid judgment WILL be entered against youo when reading personal jurisdiction cases: (1) close attention to the facts

(particularly the facts that would like D to the forum state); (2) closeattention to the courts reasoning; (3) how the courts applying the reasoningto the facts; (4) every sentence counts.

- Mailed notice of service to company offices AND personal service to one of the salespeople (court characterizes this as substituted service service on a substitute forthe actual defendant)

- Defendant specifically took steps to avoid action that would give Washingtonjurisdiction over them (1 shoe, out-of-state supervision, sales took place out of state;products shipped F.O.B. freight on board, meaning that once a shipment leaves themanufacturer, it becomes the property of the buyer)

- Contacts that connect D to Washington: salespeople reside in state, long-termemployees, company sales are in state, display in state, salespeople paid in state(fair amount of salary sufficient compensation for doing work in Washington)

o In personam action: corporations are considered legal peopleo In personam - Jurisdiction over proceedings against a persono In rem - Jurisdiction over proceedings against propertyo Quasi in rem - Proceeding against property of a person in order to secure

some judgment

- Ps arguments:o Implied consent by having salesmen operate in the stateo Sufficient contacts in the stateo Claim arises directly out of Ds connection to the state

- Ds argument:o No property or personal presence in state; unfair in due process

- Court: minimum contacts testquality and nature of those contacts sufficient tojustify subjecting D to suit in forum state consistent with due process (reasonable

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conclusion drawn from all the circumstances frequency of acts, regularity of theacts, continuous & systematic vs. irregular & isolated, nature of the acts,reasonableness of the burden of going to forum state to defend the case)

o To the extent that D benefits from protections of the state, its fair to expect Dto defend against claims arising from activities in the state

- Once sufficiency of contact is established, question of sufficient service registeredmail to out of state office is sufficient notice of proceedings (change from Pennoyer,where service is limited to in-state physical presence, service is now mainly forpurpose of notice rather than bringing D into forum state jurisdiction) P does nothave to find a physical presence of D in state, no need for personal service to anagent or representative

- Jackson: this discussion is unnecessary states have the power to tax parties whooperate or do business within their borders and states have the power to establishcourts as forum for citizens/state govt who wants to sue; as long as the notice isadequate, suit is ok; majority is depriving the states when majority conditions thepower to sue non-residents on minimum contact

Long-arm statutes- statutory basis for state courts to reach beyond their borders to bring in non-

resident defendants (tortfeasor)- CAs general jurisdiction long-arm statute not inconsistent with constitution, i.e.

is this extension of jurisdiction to the non-resident consistent with due process- Consistent with minimum contacts analysis?

General vs. specific jurisdiction- specific jurisdiction over D for claims arising out of Ds contact in the forum state- general jurisdiction over D for any action occurring anywhere

o court always has jurisdiction over the plaintiff filing of complaint impliesconsent to jurisdiction

o general jurisdiction over D when D is domiciled in the state, D isincorporated in the state, systemic and regular contacts in the state, etc.

McGee v. International Life Insurance

- D: we lack minimum contact with CA looking at the facts of our case as comparedto International shoe; does not answer

- Court enters default judgment for McGee- McGee files new suit in Texas to enforce judgment; D argues that judgment was

invalid because CA courts lacked jurisdiction (collateral attack)o Court wont dismiss suit on its own for lack of jurisdiction if D does not

bring personal jurisdiction defense, D waives that affirmative defense; if Ddoes not respond to suit, court cannot raise personal jurisdiction objectionon Ds behalf

- SCOTUS decision: contacts are sufficient for minimum contact testo Concerned with fairness to D (what kind of contacts in forum state), fairness

to P (interests in suing at home) and the interest of the forum state

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Personal Jurisdiction in Federal Courts- 4(k)(1)(A): federal courts must follow the jurisdiction rules of the state in which the

court is located long-arm statute + minimum contact & due process concerns- 4(k)(1)(B): (100-mile bulge rule) personal jurisdiction of federal court exercised

over impleaded D if impleaded 3rd party is within 100 miles of state borders

(minimal inconvenience)

October 28, 2008

3 steps of personal jurisdiction analysis:1. Long-arm statute2. Ds sufficient minimum contacts3. Reasonableness and fairness factors

a. Unfairly prejudice in having to defend in the forum stateb. Forum states interest in having the case play outc. Ps interest in having the case adjudicated in his forum stated. State interest in efficient resolution of controversies (where is the evidence,wheres an efficient place to try the case)e. Furthering fundamental social policy (what kinds of policy interests do the

shared states have) 2 and 3 grow out of 14th amend due process provision

How do you serve a corporation? Paid entity as agent of service of process

What are the requirements for determining what D has to do to submit itself to thejurisdiction of the forum state? what does it mean when D purposefully avails itself ofthe benefits of engaging the commerce in the forum state

AsahiCompeting visions of stream of commerce and minimum contacts (although the court isunanimous on the decision to dismiss the case)

- Oconnor view (II-A): its not enough to know that parts might travel into a state(mere awareness is insufficient) purposeful action is needed in addition toawareness (i.e. advertise in the state, provide advice to customers in the state, set upspecific distributor in the state, market products specifically to the state)

o Not a majority proposition (4 votes only)- Brennans view: stream of commerce view should be broader its predictable that

Asahis products would end up in CA, Asahi is benefitting from the presence of their

products in CA (awareness is sufficient, no need for plus factors)- If the goal is clarity to D, it doesnt matter what the rule is as long as the rule is clear

Unanimous agreement focuses on the fairness factors (reasonableness of exercise ofjurisdiction) elaboration of these factors

- burden to D: relatively long distance to travel; difficulty in submitting itself to aforeign nations judicial system

- CAs interest: Zurcher settled case out of court CA has relatively little interest inthe action b/c there is no longer a CA citizen involved

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o Originally, state would have had an interest in preventing defective products- Nothing efficient in resolving this dispute in CA from a litigation standpoint b/c it

involves the law and practices of other nationsWhite:

- stream of commerce debate is irrelevant because unfairness/unreasonable factorsare sufficient and decided

Burger King v. RudzewiczIssue: (contracts case, not a torts case)

- How do courts assess contracts cases (vs. torts cases)?o Mere contract with a party in forum state is not sufficient for exercise of

jurisdiction examine contract and the subsequent business actions that theparties take in the forum state

The extent to which D is conducting the contracted business in theforum state (actual course of dealings)

Terms of contract, what does the contract contemplate? Negotiations leading up to contract Experienced and knowledgeable business parties in this case Choice of law conditions Florida law will apply (different from

saying that all disputes will be settled in Florida) suggests that Dperceived itself as having sufficient contacts to warrant jurisdiction

- How do courts weight fairness factors (vs. minimum contacts)?o Efficiency: application of Florida law is most easily done in Florida courtso Even if the contacts are weak, it seems fair to submit the parties to Florida

jurisdiction

Possible tension between fairness and predictability: test for personal jurisdiction has

some flexibility in it more fair because case-specific application? Or less fair because lackof predictability?

October 29, 2008

Shaffer v. HeitnerPennoyer (1877) International Shoe (1945) H (1958) Shaffer (1977) WWV (1980) Calder (1984) Keeton (1984) Burger King (1985) Asahi

Any proceeding against property is not against the property itself but fundamentallyagainst the owners interest in the property.

- shareholders derivative lawsuit: right to recover damages derives from theshareholders stake in the corporation

- Heitner (single shareholder) and sues Greyhound, various subsidiaries and 28present and former corporate officers on grounds of mismanagement (that led tothe anti-trust prosecution which took place in Oregon)

o Greyhound incorporated in Delaware- Delaware statutes:

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o 366 sequestration statute allowing state to assert jurisdiction over non-resident and compel their appearance by sequestering the defendantsproperty in the state

o 169 situs of stock is in Delaware for all corporations incorporated inDelaware

- property gives court jurisdiction (ultimately to bring the defendants intojurisdiction) claim does not arise from the property; property as a means- Ds entered a special appearance to challenge jurisdiction

Issue: whether the state can exercise jurisdiction over an out-of-state defendant based onthe defendants in-state property what is the test that applies? (Pennoyers physicalpresence rule enough after Ints shoe decision?)

SCOTUS: for quasi in rem proceedings, minimum contact rule should replace physicalpresence rule constitutional due process

- quasi in rem jurisdiction is about the persons interest in the property, a way tohook someone the court would not otherwise have jurisdiction over

- courts should look at context to determine jurisdiction over in-state property:o contactso forumo claim (has to arise from contacts with the forum state)

stock the source of the claim some of the directors sued do not holdcorporate stock

Heitners arguments for maintaining Pennoyer formulation for quasi in rem jurisdiction:- state has interest in its ability to control parties incorporated in-state

o if no quasi in rem, possible property of the runaway defendant who keepsmoving property to avoid prosecution

- quasi in rem establishes a clearer standard than the Intl Shoe regime greatercertainty

- status quo its always been done this way (ifI were a fiddler on the roof)Counterarguments:

- if you get a valid judgment (where court had personal jurisdiction over thedefendant), that judgment can be enforced in another state (full faith and creditclause); in many states, property can be secured;

- in most cases, the fairness standard is enough and it will work; to the extent thefairness standard doesnt work, we must sacrifice jurisdiction over the defendantb/c due process clause requires it;

- history is important, but history of personal jurisdiction is not decisive generalstandards of fairness and justice can be offended by tradition

**constitutional interpretation: what does the constitution require (justice as predictabilityor flexibility?)

Heitner: minimum contacts fulfilled b/c corporation incorporated in Delaware (state hasinterest in asserting jurisdiction over them) and the directors voluntarily affiliated

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themselves with the corporation and the state purposefully availed themselves of thebenefits of Delaware law

- SCOTUS: not enough no purposeful availment; statute does not assert thatdefendants must submit to state jurisdiction;

o Ownership of shares too broado Delaware did not have a long arm statute to reach out-of-state shareholderso Not all directors had stock and they were not served b/c there was no way to

sequester their property and bring them into jurisdictiono Availment here only relates to choice of law whichever jurisdiction over the

defendants should apply choice of law; directors do not have to submitthemselves to Delaware jurisdiction;

Delaware response to decision: establishes long arm statute to capture stockholders ofDelaware corporations (now in place)

Powell and Stevens concurrences

- Powell concurs (agree with the judgment and the reasoning, but adding aqualification or additional point)- Stevens concurs with the judgment (agrees with the outcome of the case,

specifically not agreeing with the majoritys reasoning)- Less eager to abandon quasi in rem jurisdiction, especially regarding real property

(as opposed to intangible property like corporate shares)- If fully abandoned quasi in rem, increased element of uncertainty (notice? Due

process?)

Brennan dissent- this is an advisory opinion court should not have reached out and decided

minimum contacts issue because this originated as a quasi in rem case and theparties believed/intended it to be so

- even if minimum contacts was relevant, there was sufficient contact directorsvoluntary association, Delawares significant state interest together mean that itsnot unfair to subject defendants to Delaware jurisdiction

o jurisdiction only relates to claims arising from fiduciary actions as corporatedirectors or a Delaware corporation specific, not general jurisdiction

Consequences for quasi in rem jursidction:- in rem jurisdiction only for claims arising from the property itself (ownership

disputes)

- quasi in rem no longer a useful framework because its ultimately a means toacquire personal jurisdiction

Practice Exercise #30 (p.671)- examine contacts: what facts are given? Are they sufficient?

o NH defendant sets up marketing booth in Bostono Knowledge that they sell to MA residents

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o Ultimates radio ads are received in MA; NH newspaper ads can be purchasedin MA

Ads text we will take you on the road, including in MAo Well-known by MA residents

- Long arm statute: 3(d) causing tortuous injury by actor or act of omission outsidethe state if he regularly does or solicits business in the state

o Use all the facts to show that3(d) applies to this case- Due process inquiry: (1) minimum contacts and (2) fairness

o Minimum contacts: should it have been foreseeable to Ultimate Auto that itwould be subject to jurisdiction in the forum state? Purposeful availment?

Contiguous states reasonably foreseeable Stream of commerce concerns (OConnor v. Brennan)

o Fairness: MAs interest in hearing the case Ps interest in bringing the case in MA Burden on D to defend in MA

October 30, 2008Personal jurisdiction wrap-up: is physical presence ever sufficient for personal jurisdiction

Burnham v. Superior Court of CA- no majority opinion about physical presence jurisdiction one collective judgment

November 4, 2008 NoticePennoyer: a person is presumed to know whats happening to his property (constructivenotice, i.e. published in newspaper, is sufficient)

Mullane (1950, after International Shoe but before Shaffer v. Heitners end to quasi-in rem)- NY law: fund goes to court for an accounting (to evaluate performance and handling

of the fund; if no objections, claims are waived and accounts are settled for theyear); notice by publication (constructive notice no one really finds out but noticeis considered given)

- Mullane a special guardian appointed by the court for all persons who might haveinterest in the common trust fund none of the beneficiaries had notice of theproceedings

o Legislature: expectation that people should be paying attention to whatshappening with their property (statute included with fund info sent out)

- Mullane enters special appearance to contest jurisdiction and notice procedure asviolation of due process constructive notice violates due process right of fundbeneficiaries

- Jackson: in rem and in personam categorizations are irrelevant here;- Basic rule: reasonably calculated under all the circumstances to apprise interested

parties of the pendency of the action and allow them a meaningful opportunity to beheard (echoes Goldberg v. Kelly)

o Notice by publication is a mere gesture, insufficient and only reaches peopleby accident

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o Notice by publication is not always inadequate: sometimes there is no otherway to notify the defendant cant obtain contact information throughreasonable due diligence

Notice by publication is not reasonable unless there is no availablealternative

No need for personal service here:y So many parties with a limited interesty Parties all share the same interest as long as enough people

receive notice, the beneficiaries interests will be safeguarded. show the court why your actions fulfill the test

Jones v. Flowers

Issue: does the state have to do anything after receiving returned letter of notice toproperty owner for seizure of property?

Majority opinion: baseline rule (reasonably calculated) not fulfilled in this case how seriously the court takes notice is proportional to the seriousness of the deprivationin question distinction from Mullane: only one party involved (majority of beneficiaries can defendthe interests of all beneficiaries)

Thomas: ex ante (vs. ex post) analysis ofreasonably calculated notice occurs at thepoint where the state puts the letter in the mailbox; certified mail seems reasonablycalculated to reach the defendant.

Venue (strategy and convenience)

- where is most advantageous for P to bring the lawsuit?- 1391 and 1392

o 1391(a) venue for diversity cases bring where the defendant resides; events occurred in the state; any forum where D is subject to personal jurisdiction at the time that

action is commenced if no other jurisdiction where claim may bebought

o 1391(b) venue for non-diversity caseso 1391(c) where a corporation resides any judicial district where the

defendant can be subject to personal jurisdiction at the time the action is

commenced cant determine if a corporation resides in a state unless we do

minimum contacts/ fairness analysis for personal jurisdiction.o 1404 Change of venue: for the convenience of parties/witnesses in the

interest of justice consistent with venue and jurisdiction concerns Farrens v. John Deere 494 US 516

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Piper v. Reyno (forum non conveniens)- case starts in CA state court, then removed to federal court in CA, then transferred

under 1404 to federal district court in PA.o state courts not subject to FRCP venue transfer (only moves within the

state); once in federal court, you can transfer to other federal courts in the

system.- Piper moves to dismiss case on forum non conveniens grounds, with the provision of

agreeing to submit to Scottish jurisdictiono Not at 12(b) motion to dismsso Forum non conveniens: asking court to exercise its discretion to decline

exercise of jurisdiction when the convenience of the parties and the interestsof justice would be better served if the action is brought in another forum.

- 6 Gilbertfactors: p.753 footnote 6o private interest factors problems involved in the mechanisms of the lawsuito public interest factors court efficiency, interest of jurors in resolving local

disputes, application of foreign law questions

- **THERE HAS TO BE ANOTHER FORUM**o what if the law in the other forum is not as favorable to the plaintiff?

Court does not want to address this question of assessing comparativeadvantages of law exceptwhen the court decides that the plaintiffdoes not have access to a reasonable remedy in the other forum

- Doctrine has only narrow applicability generally only used when there are non-USparties involved

1404: moving venue1406: district court of a district shall dismiss or transfer venue