Chapter 3: Courts and Alternative Dispute Resolution

I. The Judiciary’s Role in American Government

Body of American law includes: federal and state constitutions, statutes passed by legislative bodies, administrative law, and the case decisions and legal principles that form the common law

Essential role of the judiciary – the courts – in the American governmental system: to interpret and apply the law

A. Judicial Review

Judicial branch can decide whether the laws or actions of the other two branches are constitutional

o This process is called judicial review Judicial Review: def.: the process by which a court decides on the constitutionality of

legislative enactments and actions of the executive brancho In line with the checks and balances

B. The Origins of Judicial Review in the United States

Courts had already overturned state legislature before judicial review Alexander Hamilton and James Madison saw its importance Marbury v. Madison – appointments of judges

II. Basic Judicial Requirements

Before a court can hear a lawsuit, you need requirements:o Jurisdiction, venue, and standing to sue

A. Jurisdiction

Juris means “law” and diction means “to speak”. Jurisdiction: def.: the authority of a court to hear and decide a specific case The court must have jurisdiction over:

o The person (or company) against whom the suit is brought (the defendant) oro The property involved in the suit. and o The subject matter of the dispute

1. Jurisdiction over Persons or Property

Court can exercise personal jurisdiction (in personam jurisdiction) over any person or business that resides in a certain geographic area

o State trial court has jurisdiction over residents or businesses in a particular area of the state, such as county or district

o State Supreme Court (or highest court) has jurisdiction over all residents of that state

Jurisdiction over property located within its boundaries o This is known as in rem jurisdiction

a) Long Arm Statutes

Long arm statute: def.: a state statute that permits a state to exercise jurisdiction over nonresident defendants

o A court can exercise jurisdiction over certain out-of-state defendants based on activities that took place within that state

The court must be convinced that the defendant had sufficient contacts, or minimum contacts, with the state to justify jurisdiction

o The defendant must have enough of a connection to the state for the judge to conclude that it is fair for the state to exercise power over the defendant

A state may exercise personal jurisdiction over a nonresident defendant who is sued for breach of contract that was formed within the state, even when that contract was negotiated over the phone or through correspondence

b) Corporate Contacts

Corporations are legal persons so the courts use the same jurisdiction principles Corporation is normally subject to the jurisdiction in the state in which it is incorporated,

has its principal office, and is doing businesso Courts apply minimum contacts test to determine if they can exercise jurisdiction

with out of-state corporations - Minimum contacts if the corporation advertises or sells its products within

the state, or places its goods into the stream of commerce with the intent that the goods be sold in the state

2. Jurisdiction over Subject Matter

Is a limitation on the types of cases a court can hear o In both federal and state court systems, there are courts of general (unlimited)

jurisdiction and courts of limited jurisdiction General jurisdiction:

o State trial court or a federal district court State court of limited jurisdiction is a probate court.

o Probate court: def.: a state court of limited jurisdiction that conducts proceedings relating to the settlement of a deceased persons estate

Federal court of limited jurisdiction is a bankruptcy courto Bankruptcy court: def.: a federal court of limited jurisdiction that handles only

bankruptcy proceedings, which are governed by federal bankruptcy law

Courts jurisdiction is usually defined in the statute or constitution creating the court Courts subject matter jurisdiction can be limited not only by the subject of the lawsuit but

also by the amount in controversy, by whether a case is a felony (a more serious type of crime) or a misdemeanor (a less serious type of crime), or by whether the proceeding is a trial or an appeal

3. Original and Appellate Jurisdiction

The distinction between the two normally lies in whether the case is being heard for the first time

Original courts are courts of the first instance, or trial courts – courts in which lawsuits begin, trials take place, and evidence is presented

o In the federal court system, the district courts are trial courts Appellate jurisdiction act as reviewing courts

o Cases can be brought only on appeal from an order or judgment of a trial court or other lower court

4. Jurisdiction of the Federal Courts

Jurisdiction of the federal courts is limited Subject matter jurisdiction in two situations

a) Federal Questions

Plaintiffs cause of action is based, at least in part, on the U.S. Constitution, a treaty, or a federal law, then a federal question arises, and the federal courts have jurisdiction

Federal question: def.: a question that pertains to the U.S. Constitution, an act of Congress, or a treaty and provides a basis for federal jurisdiction in a case

o Any lawsuit with a federal question can originate in a federal court- A federal court will apply federal law

b) Diversity of Citizenship

Federal district courts also exercise original jurisdiction over cases involving diversity of citizenship

Diversity of citizenship: def.: a basis for federal court jurisdiction over a lawsuit between citizens of different states and countries

Two requirements: 1. The plaintiff and defendant must be residents of different states2. The dollar amount in controversy must exceed $75,000

Corporation is both a citizen of the state it is incorporated and the state in which it principal place of business is located

o Case involving diversity of citizenship is filed in appropriate federal district court If case starts in a state court, it can sometimes be transferred, or “removed” to a federal

court

Law applied will be federal law for federal questions. For diversity of citizenship a federal court will apply the relevant state law

5. Exclusive versus Concurrent Jurisdiction

When both federal and state courts have the power to hear a case concurrent jurisdiction occurs

Concurrent jurisdiction: def.: jurisdiction that exists when two different courts have the power to hear a case

When cases can be tried only in federal court or only in state courts, exclusive jurisdiction exists

Exclusive Jurisdiction: def.: jurisdiction that exists when a case can be heard only in a particular court or type of court

Federal courts have exclusive jurisdiction in cases involving federal crimes, bankruptcy, patents, and copyrights; in suits against the U.S.; and in some areas of admiralty law (ocean laws)

State courts have exclusive jurisdiction – divorce and adoption Concurrent jurisdiction exists, a party may bring a suit in either a federal court or a state

court Factors to decide are availability of different remedies, the distance to the respective

courthouses, or the experience or reputation of a particular judge o Trade secret – federal court – which has exclusive jurisdiction over copyrights,

trademarks, patentso Resident of another state might choose federal court because the state court judge

might be biased with his own resident

B. Jurisdiction in Cyberspace

For a court to compel a defendant to come before it there must be at least minimum contacts

1. The Sliding Scale Standard

For determining when the exercise over an out of state defendant is proper Three types of Internet business contacts: (JURISDICTION)

1. Substantial business conducted over the internet (with contracts and sales, for example) (PROPER)

2. Some interactivity through a web site (IMPROPER)3. Passive advertising (MAY OR MAY NOT)

**Internet communication is passive if people have to voluntarily access it to read it and active if it sent to specific individuals

In certain situations, even a single contact can satisfy the minimum contacts requirement

2. International Jurisdictional Issues

Internet is global raising international jurisdiction issues

World’s courts seem to be following minimum contacts requirement A business firm has to comply with the laws in any jurisdiction in which it targets

customers for its productso Complication is that laws in different countries differ to varying capacities

C. Venue

Venue: def.: the geographic district in which a legal action is tried and from which the jury is selected

o The most appropriate physical location for a trial o Convenience is also important

Reflects the policy that a court trying a suit should be in the geographic neighborhood (usually the county) where the incident occurred or where the parties involved in the lawsuit reside

**Civil case – usually where the defendant resides **Criminal case – where the crime occurred Pretrial publicity might require a change of venue especially if right to a fair and

impartial trial has been impaired

D. Standing to Sue

Standing to sue: def.: the legal requirement that an individual must have a sufficient stake in a controversy before he or she can bring a lawsuit

o Party must have legally protected and tangible interest at stake in litigationo Party must have suffered harm or have been threatened by harm as a result of

action in the lawsuit Justiciable controversy: def.: a controversy that is not hypothetical or academic but real

and substantial; a requirement that must be satisfied before a court will hear a case Person may be standing to sue for another person such as a minor or a mentally

incompetent person

III. The State and Federal Court Systems

52 court systems – 50 states, D.C. and a federal system Federal court system is structured

A. The State Court Systems

State courts may includeo Trial courts of limited jurisdiction o Trial courts of general jurisdiction o Appellate courtso State’s highest court (usually State Supreme Court)

Any person party to a lawsuit has the opportunity to plead before a trial court and if guilty before at least one appellate court

o If federal then the appeal can go up to the U.S. Supreme Court Some states judges are elected some are appointed. Also state decides the years a judge

will serve Judges in federal system are appointed by the president with approval from the senate for

life or retirement

1. Trial Courts

Courts in which trials are held and testimony takeno State general jurisdiction trial courts – county, district, superior, or circuit courts

- Jurisdiction determined by size of county- Wide variety of topics – both civil disputes and criminal prosecutions

o Limited jurisdiction – special inferior trial courts or minor judiciary courts Small claims courts: def.: a special court in which parties can litigate small claims

without an attorney o Involving less than a certain amount, such as $5000 (varies by state)o Conducted informally

Inferior trial court is a local municipal court that hears mainly traffic caseso Both small claims and municipal may be appealed to state trial court of general

jurisdiction Limited jurisdiction courts: domestic relations or family courts, probate courts Some states have Islam courts

2. Appellate, or Revising, Courts

Every state has at least one court of appeals which may be the intermediate court or the state’s highest court

Panel of three or more judges reviews records of cases on appeal, which includes transcript of the trial proceedings, and determines whether the trial court committed an error

a) Focus on Questions of Law

Appellate courts generally focus on questions of law not on questions of fact Questions of fact: def.: in a lawsuit, an issue that involves only disputed facts, and not

what the law is on a given moment o Whether a party actually burned a flag

Question of law: def.: in a lawsuit, an issue involving the application or interpretation of a law

o Whether flag burning is a form of speech protected by the first amendment

b) Defer to the Trial Court’s Findings of Fact

Appellate courts usually defer to a trials courts findings on questions of fact because the trial court judge and jury were in a better position to evaluate testimony

They will challenge a trial courts findings of fact only when the finding is clearly erroneous or when there is no evidence to support the finding

c) Highest State Courts

Usually called the supreme court **Decisions reached by each state’s highest court on state law is final Issues of federal law are involved then it can be overruled by the U.S. Supreme Court

B. The Federal Court System

Three tiered: 1. U.S. district courts (trial courts of general jurisdiction) and various courts limited

jurisdiction2. U.S. court of appeals (intermediate court of appeals)3. The United States Supreme Court

Federal judges are appointed by the president and approved by the senate o Life terms

1. U.S. District Courts

The federal district court is the equivalent of a state trial court o At least one in every state o Judicial districts can vary over time due to population changes and corresponding

caseloads Federal cases usually originate in district courts

2. U.S. Court of Appeals

13 courts of appeals (known as the U.S. circuit court of appeals) 12 - They hear appeals from their district courts located within their judicial circuits The 13th national appellate court has national jurisdiction over certain types of cases, such

as patent law cases and cases where U.S. is defendant

3. The United States Supreme Court

The highest federal level court Only 1 All other courts inferior Has 9 justices Rarely does it have trial jurisdiction. It is mostly all appeals cases Can review any case by the federal courts and some by the state courts

a) Appeals to the Supreme Court To bring a case to the Supreme Court, a party must request that the court issue a writ of

certiorari Writ of certiorari: def.: a writ from a higher court asking a lower court for the record of a

case Rule of four: def.: rule of the U.S. supreme court under which the court will not issue a

writ of certiorari unless at least four justices approve of the decision to issue the writ Issue writs under its discretion and they are not required to issue one

o Most petitions for writs are deniedo A denial has no precedent

b) Petitions granted by the Court

The court grants petitions when the case rises important questions or when the lower courts are issuing conflicting decisions on a significant issue

o Justices don’t explain why thy choose some cases so it is hard to predict which one’s will be chosen

IV. Following a State Court Case

There is the plaintiff and the defendant and they are both represented by lawyers Litigation: def.: the process of resolving a dispute through the court system A large body of law – procedural law – establishes the rules and standards for

determining disputes in courts The applicable procedures will depend on whether the case is civil or criminal

A. The Pleadings

The complaint and answer (and the counterclaim and reply) taken together are the called the pleadings.

Pleadings: def.: statements by the plaintiff and the defendant that detail the facts, charges, and defense of a case

1. The Plaintiff’s Complaint

Complaint: def.: the pleading made by a plaintiff alleging wrongdoing on the part of the defendant. When filed with a court, the complaint initiates a lawsuit. It contains:

1. The facts necessary for the court to take jurisdiction2. A brief summary of the facts necessary to show that the plaintiff is entitled to

relief (remedy)3. A statement of the remedy the plaintiff is seeking

2. Service of Process

After the complaint has been filed, a process server – one who delivers the complaint and summons – serves a summons and a copy of the complaint

Summons: def.: a document informing the defendant that a legal action has been commenced against her or him and that the defendant must appear in court on a certain date to answer the plaintiffs complaint

Failure to answer the complaint and summons may result in a default judgment Default judgement: def.: a judgement entered by a court against a defendant who has

failed to appear in court to answer or defend against the plaintiffs claimo The plaintiff could be awarded their damageso The defendant has to have been properly served

3. The Defendant’s Answer

Answer: def.: procedurally, a defendants response to the plaintiffs complainto Either admits or denies the claimo If admits then they will enter a judgement o If denies then the litigation will go forward

There can be a counterclaim: def.: a claim made by the defendant in a civil lawsuit against the plaintiff. In effect, the defendant is suing the plaintiff

The plaintiff will have to answer with a pleading, normally called a reply: def.: procedurally, a plaintiffs response to a defendants answer

Admittance of the truth of the defendant but raising new facts – that may result in a dismissal is called an affirmative defense

4. Motion to Dismiss

Motion to dismiss: def.: a pleading in which a defendant admits the facts as alleged by the plaintiff but asserts that the plaintiffs claim to state a cause of action has no basis in law

Grounds of dismissal include: o Improper delivery of the complaint and summonso Improper venueo And plaintiffs failure to state a claim for which a court can grant relief

If judge grants the motion, the plaintiff is usually given time to file an amended complaint

If judge denies the motion, the suit will go forward, and the defendant must then file an answer

Court can also dismiss a claim on its motion

B. Pretrial Motions

Either party may attempt to get the trial dismissed through use of various pretrial motions One is the motion to dismiss previously mentioned

At the close of the pleadings, either party can make a motion for judgement on the pleadings: def.: a motion to a lawsuit requesting the court to decide the issue solely on the pleadings without proceeding to trial. The motion will be granted only if no facts are in dispute

o Only evidence contained in the pleadings Motion for summary judgement: def.: a motion requesting the court to enter a judgement

without proceeding to trial. The motion can be based on evidence outside the pleadings and will be granted only if no facts are in dispute

o No genuine questions of fact

C. Discovery

Each party can use a number of procedural devices to obtain information and gather evidence about the case from the other party or from a third party

Discovery: def.: method by which the opposing parties obtain information from each other to prepare for trial

o Gaining access to witnesses, documents, records, and other types of evidenceso Allowed regarding any matter that is not privileged and is relevant to the claim or

defense of any party Read book Pg. 77

1. Depositions and Interrogatories

Deposition: def.: the testimony of a party to a lawsuit or a witness taken under oath before a trial

o Person being deposed answers questions by attorneys they are recorded and then signed by him or her

o Answers will help attorneys prepare for trial o Can be used in court to impeach (challenge the credibility) of a party or witness

who changes their testimony Interrogatories: def.: a series of written questions for which written answers are prepared

by a party to a lawsuit, usually with the assistance of the party’s attorney, and then signed under oath

o Are directed towards a party of the lawsuit not a witness and the answers can be prepared by help from an attorney

o Parties are obligated to answer the questions even if that means disclosing information from their records and files

2. Requests for Other Information

A party can serve a written request on the other party for an admission of the truth on matters relating to the trial

o Conclusively established for the trial Gain access to documents and other items not in her or his possession in order to inspect

and examine them

o Gain “entry upon land” to examine the premises Physical or mental condition of one party is in question, the opposing party can ask the

court to order a physical or mental examination, but the court will do so only if the need for the information outweighs the right to privacy of the person to be examined

3. Electronic Discovery

Any relevant material including information stored electronically can be the object of a discovery request

E-evidence: def.: a type of evidence that consists of all computer generated or electronically recorded information

o Email, voice mail, tweets, blogs, spreadsheets, documents stored on computers o Can reveal important facts not otherwise seen

a) E-discovery Procedures

A party must usually hire an expert to retrieve evidence in its electronic format Expert uses software to reconstruct email exchanges and establish who knew what and

when o Recover files the user thought deleted

b) Advantages and Disadvantages

Advantages: o Back-up copies of documents and email can provide useful and often quite

damaging information about how a particular matter progressed over several weeks or months

o Can uncover the proverbial smoking gun that will win the lawsuit Disadvantages:

o Time consuming and expensive especially when lawsuits deal with big firms o Many firms are finding it difficult to preserve electronic evidence from a vast

number of sources

D. Pretrial Conference

Either party can request the pretrial conference, or hearing o Consists of an informal discussion between the judge and the opposing attorneys

after discovery has taken placeo It is to explore the possibility of a settlement without trial and, if this is not

possible, to identify the matters that are in dispute and to plan the course of the trial

E. Jury Selection

Trial can be held with or without a jury

In federal courts, a trial is guaranteed when the amount in controversy exceeds $20, but it’s not the same for state courts

For states the guarantees are similar but not the dollar amounts The right to a trial by jury does not have to be exercised In most state and in federal courts one of the parties must request a jury in a civil case or

the judge presumes that the parties waive the right Voir dire: def.: an important part of the jury selection process in which the attorneys

question prospective jurors about their backgrounds, attitudes, and biases to ascertain whether they can be impartial jurors

o Jurors are asked oral questions to determine bias or connections missedo Party may challenge a prospective juror peremptorily – ask that an individual not

be sworn in as a juror without providing reason o Also may challenge juror for cause – provide a reason why an individual should

not be sworn in as a juror - Cannot be excluded by discrimination, race or gender

F. At the Trial

Attorneys present their opening arguments, facts they expect to prove during the trial Then the plaintiffs case is heard

o Introduce evidence, witnesses …documents o Defendant has opportunity to defend the evidence and cross examine the

witnesses

1. Directed Verdicts

At the end of the plaintiffs case there can be a motion for a directed verdict Motion for a directed verdict: def.: a motion for the judge to take the decision out of the

hands of the jury and to direct a verdict for the party making the motion on the ground that the other party has not produced sufficient evidence to support his or her claim

o If not granted the defendants attorney then presents their evidence - The defendants can then ask for a motion for a directed verdict- Plaintiffs attorney can challenge any evidence

2. Closing Arguments and Awards

After defense concludes its presentation the attorneys present their closing arguments each urging a verdict in their favor

Judge instructs the jury in the law that applies to the case (the charges)o Jury retires to deliberate

The jury decides the verdict and also if there is an award the amount Award: def.: the monetary compensation given to a party at the end of a trial or other

proceeding

G. Post-trial Motions

After jury has rendered its verdict either party may make a post-trial motion If the plaintiff wins and the defendant had previously asked for a directed verdict then he

can ask for a motion for judgement n.o.v. Motion for judgement n.o.v.: def: a motion requesting the court to grant judgement in

favor of the party making the motion on the ground that the jury’s verdict against him or her was unreasonable and erroneous

o If judge grants then the jury’s verdict is out and the defendant wins Motion for a new trial: def.: a motion asserting that the trial was so fundamentally flawed

(because of error, newly discovered evidence, prejudice, or another reason) that a new trial is necessary to prevent a miscarriage of justice

H. The Appeal

If post-trial motion is denied then the defendant can appeal If the plaintiff wins but gets less money than they wanted they could appeal also A party MUST have a legitimate reason for appealing a case

o Must be able to claim an error The defendant becomes the appellate or petitioner and the plaintiff becomes the appellee

or respondent

1. Filing the Appeal

The appellant attorney files the record for an appealo All the trial material with the transcripts …

Also give a condensation of the record, an abstract, and a brief Brief: def.: a written summary or statement prepared by one side in a lawsuit to explain

its case to the judge There will also be an answering brief from the other party

2. Appellate Review

Court of appeal does not hear evidence only reviews the records for errors of law Attorneys can give oral arguments but then the case is taken under advisement The court then has to decide the options PG. 81

3. Appeal to the Higher Appellate Court

Only if the reviewing court is intermediate Corresponds like the writ of certiorari Losing party can petition the courts for one

o Discretionary power can hear whichever case they want If appeal granted then new briefs must be filed and attorney statements be presented

o Reverse or affirm the case

I. Enforcing the Judgement

Lack of guarantees that any judgment will be enforceable Even if plaintiff wins award the defendant may not have enough assets to pay it

V. The Courts adapt to the Online World

Internet has brought new methods for filing pleadings and documents and issuing decisions

New cyber courts, totally onlineA. Electronic Filing

Federal court system now has an electronic filing system Can create a documents save as PDF then log it onto the courts web site

B. Courts Online

Most courts have web siteso Each can decide what to post

Court rules, decisions (judgements), phone numbers Docket: def.: the list of cases entered on a courts calendar and thus scheduled to be heard

by the court Decisions of a lot of courts are posted onto their websites

C. Cyber Court’s and Proceedings

Judicial proceedings take place in the internet Parties meet online to present their arguments and evidence

o Email, video cameras, chats roomso Efficient and economical

Virtual lawyers, judges and juries Cyber courts dealing with cases of technology Use of video conferencing in regular courts Internet part of judgements

o Virtual visitation rights

VI. Alternative Dispute Resolution

Several years may pass before a case is actually tried Alternative Dispute resolution (ADR): def.: the resolution of disputes in ways other than

those involved in the traditional judicial process, such as negotiation, mediation, and arbitration

o Parties sitting down together and attempting to work out their differenceso Multinational corporations agreeing to resolve a dispute through a formal hearing

before a panel of experts

A. Negotiation

Simplest form ADR Negotiation: def.: a process in which parties attempt to settle their dispute informally,

with or without attorneys to represent them o Frequently advised instead of going to trial o During a trial and even after but before appeal

Involves the parties and their attorneys

B. Mediation

Mediation: def.: a method of settling disputes outside the courts by using the services of a neutral third party, who acts as a communicating agent between the parties and assists them in negotiating a settlement

o Mediator talks with them separately then jointly in attempt to help Mediators proposal- but not the decision Not as adversarial as litigation Mediator takes active role trying to help resolve

o Tends to reduce hostility- later able to resume relationship like before preferred method

C. Arbitration

Arbitration: def.: the settling of a dispute by submitting it to a disinterested third party (other than a court), who renders a decision

The third party makes the decisiono Usually parties decide that the decision is legally binding

Although it can be nonbinding o Parties can go forwards with lawsuits if they don’t agree

Resembles a trial

1. Arbitrators Decision

Arbitrators decision is called an awardo Final word

Parties may appeal decision, but appellate courts review is restricted in scope compared to if you stared with a trial

Court Reject the decision if … PG 85

2. Arbitrators Clauses

Arbitration clause: def.: a clause in a contract that provides that, in the event of a dispute, the parties will submit the dispute to arbitration rather than litigate the dispute in court

Found in contracts

3. Arbitration Statutes

States have statutes where arbitration will be enforced

4. The Issue of Arbitrability

Disputes usually arise when an agreement that contains an arbitration clause: one party wants arbitration and the other wants court trial

If covered by clause then it has to happen Only if the party consented to it. It cannot be forced Won’t let it happen if it unfair to a party

5. Mandatory Arbitration in the Employment Context

Rights aren’t protected when employers force employees as a condition of being hired to agree to arbitrate all disputes and waive their rights under statutes

Employers – be careful that you are not too one sided

6. Private Arbitration Proceedings New confidential arbitration process which allows parties to arbitrate in private

D. Providers of ADR Services

Services are provided by both the government and private organizations AAA nonprofit association PG. 88 For profit firms

E. Online Dispute Resolution

Dispute resolution on internet offered by companies and organizations Online dispute resolution (ODR): def.: the resolution of disputes with the assistance of

organizations that offer dispute resolution services via the internet