Civil Procedure Outline

I.

Chapter 1 Introduction
A. Normative values to consider
1. Efficiency
a. Operation of the judicial system
b. Out of court conduct
2. Distribution
a. Who do these procedural rules benefit and who do they hurt?
i. Groups in the nation e.g. poor/rich; corporations/individuals, etc.
3. Individual fairness
a. Does it satisfy our sense that people were given an adequate opportunity to be heard in
the system?
4. Legitimacy
a. Are the rules being carried out in such a way that there is a genuine sense that an
acceptable authority has acted? Are the outcomes likely to be accepted?
B. Outline of a Lawsuit
1. What is Civil Procedure?
a. Civil area of law that governs the obligations that individuals may enforce against
each other
b. Procedure the system of resolving disputes, usually in a judicial forum
2. Dispute Resolution by Courts versus Other Agencies
a. Disputes may be resolved outside of the judicial forum in nonadjudicative tribunals,
mediation, and arbitration
3. State versus Federal Systems
a. State system plenary authority
i. Three tiers (trial, intermediate, and a supreme court)
b. Federal system limited subject matter authority
i. Three tiers District courts, courts of appeals, and the U.S. Supreme Court
4. Stages of a Lawsuit
a. Investigation
i. Attorney interviews the client and then conducts legal research to determine
whether the client has a viable claim
b. Retainer
i. Arrangement for payment of the fee to the attorney
1. Contingent fee client agrees to pay his attorney a percentage of this
recovery should he win, but recover nothing if he loses
c. Subject Matter Jurisdiction Federal Court or State Court?
i. Two principle bases of federal subject matter jurisdiction:
1. Arising under jurisdiction
2. Diversity jurisdiction
d. Personal Jurisdiction
i. Can the D be sued within the geographical territory over which the court has
authority?
e. Service of Process
i. Notice to the D of the commencement of the lawsuit
1. Summons an official document issued by the court advising the D that a
lawsuit has been started
2. Personal service/mail
f. Pleadings
i. Complaint

ii. Answer
1. Motion to dismiss for lack of personal or subject matter jurisdiction
2. Demurrer so what? or motion to dismiss for failure to failure to state a
claim
3. Answer affirming or denying the allegations of the complaint
4. Counterclaim
g. Remedies
i. Ps requested form(s) of relief
1. Money damages
2. Injunction
3. Declaratory relief declaration of rights, statute, or other legal relationship
4. Interim relief temporary restraining order or preliminary injunction
h. Pretrial Discovery a process of obtaining information from the opposing party and
witnesses
i. Depositions recorded examinations of witnesses under oath
ii. Requests for production of documents
iii. Interrogatories - written questions
i. Summary Judgment judgment without trial
i. Granted when there is no genuine material issue for trial
j. Trial
i. Judge or jury trial
1. Voir dire determines juror bias, prior knowledge of the case, and prior
involvement with the parties
2. Peremptory challenges strike jurors without cause
ii. Opening statements
iii. Direct examination, cross examination, redirect, and re-cross
iv. Directed verdict the state of evidence is such that a reasonable jury could only
come out one way
v. Closing arguments
vi. Jury Instructions
vii. Verdict
1. General for the P or D
2. Special jury to answer certain questions leaving the judge to determine the
verdict
viii. Postverdict motions
1. Motion of judgment notwithstanding the verdict the case should not have
gone to the jury in the first place
2. Motion for a new trial - the judge made some error or the verdict was against
the clear weight of evidence
k. Appeal review by an appellate court of the decisions of a trial court
i. May affirm, reverse, modify, or remand
l. Enforcement of Judgments
i. Execution governed by state law
ii. Full faith and credit state and federal courts owe an obligation to give full faith
and credit to the judgment of other courts in the system
m. Finality once a court establishes the relative rights of the litigants, the parties will not
be permitted to relitigate their claims or defenses
i. Claim preclusion (res judicata)
ii. Issue preclusion (collateral estoppel)
C. Illustration of the Stages of a Lawsuit New York Times v. Sullivan (p. 13)

1. The Context of the Lawsuit - An ad appeared in the New York Times. Sullivan brought this lawsuit
claiming that the ad hurt his reputation although his name is not mentioned in the ad.
2. The Lawsuit Begins
a. Summons and Complaint
3. The Ds First Response
a. Demurrer
b. Motion of Quash Service of Process
i. Special appearance contesting personal jurisdiction
4. The Discovery Process
a. Motion to Produce P requesting documents from the D that will substantiate personal
jurisdiction
b. Deposition of Claude Sitton
5. The Motion to Dismiss D lost its motion to quash so now obligated to respond to the substance of
Ps complaint
a. Demurrer of the D
6. The Answer a response directly to the Ps complaint
a. Answer of the New York Times Co.
7. Pretrial Discovery on the Merits
a. Interrogatories to D
b. Answers of the D to the Ps Interrogatories
8. Note on Settlement, Burden of Proof, and Summary Judgment most lawsuits are either settled
voluntarily between the parties or resolved by the judge prior to trial
a. Settlement
i. Terms of a settlement depend on a number of factors
1. Each partys assessment of the likely outcomes
2. Pressure on the party to resolve the case quickly
3. The negotiating skills of each partys representative
4. The effects of settlement on the world beyond this lawsuit
5. The incentives of the lawyers themselves
b. Burden of Proof
i. P had the burden of proving to a jury, by providing it with sufficient evidence, that
the advertisement was about him, that it tended to injure him, and the D published
it
ii. D bears the burden of proof on the elements of any affirmative defenses he raises
c. Summary Judgment
i. Asks whether based on the evidence a reasonable trier of fact could rule in favor of
the nonmovant
9. The Trial
a. General verdict for the P
10. Post Trial Proceedings
a. D moved for a new trial which was denied
11. The Appeals
a. The United States Supreme Court reversed the Alabama judgment of 1 st Amend grounds
II.

Chapter 2 Personal Jurisdiction and Other Court-Access Rules

- Where may a lawsuit be filed?
i. One of the foggiest realms of civil procedure!
ii. P may not sue a D anywhere; there are limits on the places where a D can be required to defend a
lawsuit
- Always ask two questions
i. Does the state authorize jurisdiction?

1. Common law or statutory basis

ii. Is the states assertion of jurisdiction consistent with constitutional due process?
- Why do parties care?
i. Inconvenience
ii. Procedural substantive law differences
- Two relevant constitutional provisions:
i. The Full Faith and Credit Clause Article IV, Section 1 of the Const.
a. Compels the enforcement of one states judicial proceedings in every other state
b. Has been construed not to require the out-of-state enforcement of judgments where the
court issuing the judgment lacked jurisdiction over the D
ii. The Due Process Clause of the 14th Amend.
a. This guarantee has been used to prohibit excessive assertion of jurisdiction by state
courts
b. 3 theories of due process
1. Originalism backward looking approach; looks at what the framers thought due
process meant when it was enacted
2. Evolutionism due process is going to change over time as general social
conditions, understandings, norms, and values change; it is up to the court to shift the
meaning in accordance with those changes
3. Deferentialism Except in the most egregious and outrageous instances, the courts
should defer to the states and their understanding of due process
A. Traditional Bases of Jurisdiction: Power, Presence, Domicile, and Consent
1. Power over the Person or Property of the D Pennoyer v. Neff (p. 74) (1877) P suing D to
recover the possession of a tract of land in a collateral attack, challenging validity of prior judgment
in Mitchell v. Neff
a. Issue: Did the Dist. Ct. have an obligation to give full faith and credit to the judgment of
the OR state court under the full faith and credit clause and 28 USC Section 1738?
b. Holding: No! OR state court did not have personal jurisdiction over D
c. General Principle:
a. No state has power outside its boundaries and every state has exclusive power
within its boundaries;
b. Jurisdiction depends on court exercising power to deliver notice where person
or property is within the state
d. Narrow Principle: When notice is made by publication and the courts jurisdiction is
based on the presence of property, the D must own the property at the time notice is
given, otherwise D doesnt have incentive to look for notice.
e. 3 district forms of personal jurisdiction:
ii. In personam based on power over the individual b/c of presence of the individual
in the territory or some proxy
1. not available here because D was not physically present in the state
iii. In rem based on the existence of property within the state and the need to
adjudicate legal rights and interests related to that property;
1. not available here b/c the lawsuit was not a claim abt the property
iv. Quasi-in-rem based on the presence of property in the state but rights to the
property are not the subject matter of the lawsuit; can only recover value of ppty
1. could have been available here if D owed property at the time of the original
lawsuit
f. Critique of these principles:
v. Significant conceptual weaknesses and fictions
2. Raising Jurisdictional Objections

a. If a D believes that jurisdiction is improper he can decline to appear and a default

judgment will be entered against him. He can then bring a collateral attack against the
judgment. This is risky esp. since the D loses the opp to contest the merits of the action
b. D can raise the jurisdictional objection in the initial proceeding
vi. Special appearance D appears only for the purpose of contesting jurisdiction
vii. D may make a timely jurisdiction objection but is also permitted to defend on the
merits
c. Rule 12(b)(2) if D is going to make a motion, he/she has to include objection to
personal jurisdiction
3. Domicile and Consent
a. Domicile the place where the person resides and intends to remain for the indefinite
future
a. state can exercise authority over one of its residents even if he is not personally
served within the state: Milliken and Blackmer (p. 85) (1940) out-of-state
service on citizens of the forum issuing process allowed
b. Consent
i. A D can consent to jurisdiction in advance of litigation
ii. Hess v. Pawloski (p. 88) (1927) D (Pa.) negligently hit P (Mass.) on a highway in
Mass. P wants to recover damages. Brings suit in Mass. state court.
1. Issue: Does the Mass. enactment regarding the service of process violate the
due process clause of the 14th Amend?
2. Holding: No! D implicitly consented to jurisdiction by using Mass.
highways
3. Broad principle: The state has the power to regulate its highways use by
nonresidents and residents which includes the power to exclude a nonresident
until a formal appointment of an agent is made on whom process may be
served fair to allow D to be sued in state if suit arises from Ds activities in
that state
4. Narrow principle: Implied consent theory The use of the highway by the
nonresident is the equivalent of the appointment of the registrar as an agent
on whom process may be served
4. Jurisdiction over Out-of-State Corporation (corporations incorporated in another state)
a. Express consent when a corporation appoints an agent for service of process in a state
in which it does business
b. Presence general jurisdiction when a corporation has extensive activities within the
state
c. Implied consent specific jurisdiction when a corporation has less activity in the
state but the claim arises from a particular activity that took place in the state
B. Expansions of Personal Jurisdiction: Specific and General
1. The Minimum Contacts Standard
a. Intl Shoe Co. v. Washington (p. 93) (1945) Petitioner, a DE corp. seeking to overturn
a ruling ordering them to pay money to WA unemployment compensation fund.
iii. Issue: Is Washingtons assertion of jurisdiction over Intl Shoe Co. consistent with
the due process clause of the 14th Amend?
iv. Holding: Yes!
v. Broad Principle: In order for state to have jurisdiction over a corporation, the
corporation must maintain certain minimum contacts w/ the state such that the suit
does not offend traditional notions of fair play and substantial justice.
a. Quality and nature of the activity with the state
vi. Narrow Principle:
1. Systematic and continuous

2. Claim arises out of in-state activities

3. Balance of conveniences
4. Received benefits and protections from state
2. General Jurisdiction When a state asserts jurisdiction over a D on all claims against the D whether
or not they are related to the Ds in-state activity
a. Noncorporate Ds
i. Unclear area Ringo Starr case but the Supreme Court has cast some doubt on the
validity of an assertion of general jurisdiction over natural persons
b. Parents and Subsidiaries
i. Jurisdiction over a parent company does not, standing alone, establish jurisdiction
over a subsidiary company, and jurisdiction over the subsidiary is not equivalent to
jurisdiction over a parent, unless the parent so controls and dominates the
subsidiary to disregard the latters independent existence.
c. Does Intl Shoe Require a Re-examination of
Traditional General Jurisdiction Doctrine?
i. Helicopteros Nacionales de Colombia S.A. v. Hall (p. 103) (1984) P seeking to
recover in TX for helicopter crash that took place in Peru. D Peruvian, but
purchased helicopters and training pilots in TX.
5. Issue: Is the exercise of personal jurisdiction over Helicol a violation of the
due process clause of the 14th Amend?
6. Holding: Yes! Helicols contacts with the state of TX were insufficient to
satisfy the requirements of the Due Process Clause of the 14 th Amend. TX
had no general jurisdiction over Helicol
7. Broad Principle: When the cause of action does not arise out of or relate to
the foreign corporations activities in the forum state, due process is not
offended by a states subjecting the corporation to its in personum
jurisdiction when there are sufficient contracts between the state and the
foreign corporation
8. Narrow principle: When general business contracts are continuous and
systematic personal jurisdiction is appropriate
9. Justice Brennan dissents: general jurisdiction should have been found, b/c D
actively and purposely engaged in numerous transactions in TX; should have
also found specific jurisdiction b/c the contacts between the D and the forum
state are significantly related to the cause of action; evolutionist approach
3. Specific Jurisdiction and the Proliferation of Specific-Act Statutes
i. What kind of relationship between the contacts and the lawsuit is sufficient to say that the claim
arises out of those contracts?
1. element of claim, but for cause, or some relationship
ii. What type of contact w/ state supports specific juris.?
a. McGee v. Intl Life Insurance Co. (p. 115) (1957) D (TX) maintained a single contract
of life insurance with P in CA
i. Issue: Did the CA court properly exercise jurisdiction consistent with the due
process clause of the 14th Amend over the D?
ii. Holding: Yes! Single acts because of their quality and nature will support specific
in personum jurisdiction
iii. Principle: Insurance contract that has a substantial connection with the forum state
is enough
a. D solicited the insured
b. Connection between insurance agreement and CA put D on notice that it will
have to D actions arises from that lawsuit long-arm statute
c. CA has interest in protecting its insured

b. Gray v. American Radiator & Standard Sanitary Corp. (p. 118) (1961) P (IL) injured
when Ds water heater exploded; the safety value of Titan (OH) company was to blame.
State long-arm statute authorized jurisdiction over parties that committed tortious acts
w/in state, and injury in state = tortious act.
i. Issue: Is the exercise of jurisdiction by IL over D consistent with due process?
Does the tortious activity of the valve manufacturer have substantial contacts
within the forum state?
ii. Holding: Yes!
iii. Principle: If a corporation elects to sell its products for ultimate use in another
State, it is not unjust to hold it answerable there for any damage caused by defects
in those products
iv. Effect of this case - Part manufacturers have to be prepared for liability anywhere!
C. The Supreme Court Imposes Limits
1. The Requirement of a Purposeful Act
a. Hanson v. Denckla (p. 129) (1958) - Trust case
i. Issue: Court Fl constitutionally assert jurisdiction over the Del. trustee?
ii. Holding: No!
iii. How is this case different from Gray?
1. D has to choose (purposeful availment) to have the affiliation with the forum
state; in this case D had no control over where Donner moved
2. Personal Injury and Products Liability Cases
a. World-Wide Volkswagen Corp. v. Woodson (p. 131) (1980)
i. Issue: May an OK court exercise personal jurisdiction over a nonresident
automobile retailer and its wholesale distributor in a products-liability action when
the Ds only connection with OK is the fact that an automobile sold in NY to NY
residents became involved in an accident in OK?
ii. Holding: No!
iii. Shift from Intl Shoe to two-part test A state may exercise personal jurisdiction
over a non-resident D only so long as there exists
a. minimum contacts between the D and the forum state such that it is
b. reasonable to require the D to defend in that state.
i. 3-way balancing of interests of P, D and state
iv. Narrow principle: If the sale of a product of a manufacturer or distributor is not
simply an isolated occurrence but arises from the efforts to serve, directly or
indirectly, the market for its product in other states, it is not unreasonable to subject
it to suit in one of those states if its allegedly defective merchandise has there been
the source of injury to its owners or to others.
b. Asahi Metal Indus. Co. v. Superior Court of California (p. 145) (1987) Motorcycle
accident; P (non-CA) v. D (Japan) D(Taiwan)
i. Holding: No jurisdiction over D
ii. Two-part Test:
a. Minimum contacts (affiliating circumstances)
i. awareness alone not enough, no purposeful availment
b. Reasonableness (Substantial justice and fair play) 3 way balancing of
interests (P, D, and state)
i. significant burden in defending in foreign country
ii. CA has little interest in suit P not CA resident
iii. Fed. interests in foreign relations
iii. Narrow Principle: The placement of the product into the stream of commerce,
without more, is not an act of the D purposely directed toward the forum state.

Need clearer evidence that the D seeks to serve the market in the forum state like
designing the product for the market in that state or advertising there
c. Libel Cases
i. Keeton v. Hustler Magazine, Inc (p. 158) (1984) P (NY) sued D (incorporated in
NY and PPB in CA) in New Hampshire federal court
a. Holding: NH has personal jurisdiction over D b/c D sought to exploit the NH
market and thus must reasonably anticipate being haled into court there
ii. Calder v. Jones (p. 159) (1984) P(CA) v. Ds (FL) in CA
a. Holding: CA had jurisdiction over Ds
d. Personal Jurisdiction and the Internet
i. Question of how interactive the Web page is
a. Websites that process customer orders versus websites that simply convey
information
3. The Commercial Contract Cases
a. Burger King Corp. v. Rudzewicz (p. 161) (1985) Breach of contract case; P (FL corp.)
v. Ds (MI franchisees) in Fl federal court
ii. Holding: FL has Jurisdiction over Ds
iii. Principle: 2 part test
iv. Principle: Continuous but limited activity in the forum state will support
jurisdiction. While an individuals contract with an out of state party alone will not
automatically establish sufficient minimum contracts, other factors including
purposeful availment, prior negotiations, contemplated future dealings, the terms of
the contract and the parties actual course of dealing may establish minimum
contacts.
4. Property-Based Jurisdiction
a. Shaffer v. Heitner (p. 178) (1977) P (non-DE) v. Individual Ds (non-DE; stock considered to
be in DE by DE statute) filed a shareholders derivative suit in DE state court
i. Issues: Should Intl Shoe be held to govern in rem as well as in personam actions? Is DEs
assertion of jurisdiction over the Ds based solely on the statutory presence of Ds property
in DE consistent with the DPC?
ii. Holding: Intl Shoe governs in rem as well as in personam actions
1. not enough that property (stock) is in DE when that property is not the subject matter of
the litigation nor is the underlying cause of action related to the property
iii. Narrow principle: Where jurisdiction is asserted on the basis of property alone (rather than
on the basis of contacts), and the claim is unrelated to the property, and the property is
intangible, and there is no provision for a limited appearance, and there is no state statute
asserting a special interest in the suit, personal jurisdiction does not exist under Shoe
1. To assert jurisdiction over an absent D when the minimum contact that is a substitute
for physical presence consists of property ownership, it must, like other minimum
contacts be related to the litigation as explained in Burnham
iv. Brennans Concurrent/Dissent: Del. should be able to assert juris. under minimum contacts
test; b/c co. is incorporated in Del., state interest in hearing suit, Ds enjoy benefits of state
5. Transient Service
a. Burnham v. Superior Court of California (p. 198) (1990) P (CA) v. D(NJ) sues for divorce
in CA; the D was served with process when he was temporarily in CA visiting the kids
i. Issue: Does the DPC deny CA courts jurisdiction over a non-resident who was personally
served with process while temporarily in that State in a suit unrelated to his activities in the
State?
ii. Holding: No! Tag/presence is enough TRADITION
1. jurisdiction based on states power over all who are physically present in state
2. no reasonableness analysis needed when D is in state

3. goes against the direction of personal jurisdiction jurisprudence

iii. Brennans Dissent (concurring): must analyze under the 2-part affiliating circumstances and
reasonableness test; finds jurisdiction as well (test has low threshold)
b. *See Anthology reading (p. 63-98) Notes 2/7
6. Comparative Jurisdiction Regimes
a. The European Convention on Jurisdiction and the Enforcement of Judgments (the Brussels
Convention)
i. Overview:
1. Jurisdictional rules are directed to the relationship between the controversy and the
forum whereas in the U.S., the Const. requires a nexus between the individual D and
the forum state
a. More difficult to travel betw. countries than betw. states so want more of a
relationship between claim and forum
2. more hard and fast rules that extend specific juris. further than U.S.
3. more protective of businesses
4. Two basic categories jurisdiction that is required and jurisdiction that is prohibited
ii. No tag/transient jurisdiction
iii. No quasi in rem jurisdiction
iv. General jurisdiction only in place of incorporation of PPB
1. More narrow than U.S.
v. Jurisdiction based on stream of commerce (products liability)
vi. Contracts jurisdiction wherever the contract is to be performed
1. Broader than U.S.
vii. Libel suit in place of publication (like in U.S.) but damages limited to recovery of harm
suffered in that state (more restrictive than U.S.), unless suit brought where publisher
located
viii. Domestic relations where support creditor resides or domiciled
1. Probably not acceptable in a U.S. court
b. A New Intl Initiative?
i. A proposed Intl treaty on jurisdiction or recognition of judgments with other countries
1. Hague Convention substantially modeled after the Brussels Convention which
includes an additional category, a gray list which allows a court to exercise
jurisdiction if it chooses but does not require recognition of a judgment resting on such
ground
D. Why Litigants Care About Choice of Forum?
1. Convenience Costs and burdens on the parties
2. Values and Bias Judges and juries
3. Procedural Advantages The structure and character of the judicial process in a particular forum
4. Choice of Law
a. The question of whose law applies is separate from which court adjudicates
b. Conflict of law rules determine what the applicable law should be
i. Used to be very clear and predictable (Restatement First)
1. E.g. For a tort action apply law in the place of injury
ii. A revolution in choice of law provided new opportunities for forum shopping
1. The state with the most significant contacts or the state with the most significant
relationship to the parties and events should apply its law to the controversy
Restatement (Second)
iii. DPC acts as a restraint on when states can apply their own law
c. Allstate Insurance v. Hague (p. 221) (1981) Ps husband killed in a motorcycle accident in
WI; the insurance policy was delivered in WI and all persons involved were WI residents at the

time of the accident; P moved to MI after the accident but prior to the initiation of the lawsuit; P
brought suit in MI and sough to apply MI law which permitted stacking (WI law did not)
i. Issue: Is MIs choice of its own substantive law in this case consistent with the DPC?
ii. Holding: Yes! Ok to apply MI law
iii. Principle: Significant contacts, creating state interests, with the parties and the occurrence
or transaction such that the choice of its law is neither arbitrary or unfair
1. different from Intl Shoe test, b/c analyzes from perspective of states connection,
instead of Ds connection
iv. Application of principle: MI has significant contacts with the parties and the occurrence
giving rise to the litigation which, in the aggregate, permit selection of MI law
v. Other opinions:
1. Silberman contacts should be just as strong as for personal jurisdiction
2. Weintrabu should consider unfairness in forum applying its own law
vi. Implications of this decision on
1. Forum shopping - more productive
2. Personal jurisdiction
a. Expansive rules abt personal jurisdiction open the door for more shopping b/c
there is very little restraint with regards to a forum state applying its own law
b. May want to rethink having quasi in rem or tag jurisdiction at all
c. General jurisdiction does this mean that forum state gets to apply its own law
just b/c D does a lot of business there?
i. Allstate yes
ii. But Shutts seems to suggest that general jurisdiction does not
automatically mean the forum can apply its law
3. Specific jurisdiction
a. With a broad specific jurisdiction understanding, D is vulnerable to a less
convenient forum and to a law they never envisioned being subject to
i. So, may want to have more narrow rules for specific jurisdiction
4. Brussels convention
a. Allows broader personal jurisdiction that corresponds to old fashion choice of
law rules
b. More attentive to choice of law implication than is the U.S. system
d. Phillips Petroleum Co. v. Shutts (p. 231) (1985) P (28,000 royalty owners mostly non-KS)
v. D (DE corp, PPB OK) brought a class action suit in KS state court which applied KS law
i. Issue 1: Did KS possess personal jurisdiction over the absent P class members as required
by Shoe?
ii. Holding: Yes! Absent class-action Ps not subject to the same burdens as D. Thus, a forum
state may exercise jurisdiction over the claim of an absent class-action P even though the P
may not possess the minimum contacts with the forum state as long as the court requires a
minimum showing of consent (opt out ok)
iii. Issue 2: Did the KS court error in applying KS law to every claim in the dispute?
iv. Holding: Yes. First, need to determine that there is a conflict between KS state law and
other state law. Second, KS does not have a significant contact or significant aggregation
of contacts to the claims asserted by each member of the P class creating state interests in
order to ensure that the choice of KS law is not arbitrary or unfair
v. This case established limits on the ability of a forum to apply its own law and seemed to
offer some protection to nationwide Ds who might be sued in any forum
e. Sun Oil Co. v. Wortman (p. 244) (1988) KS applying its own SoL to a claim governed in its
substance by another states law
i. Issue: May a statute of limitations be considered as a procedural matter for purposes of the
FFCC and DPC? Which States law governs the SoL?

10

ii. Holding: Yes! KS did not violate the FFCC or DPC when it applied its own SoL (Scalia
looks at tradition)
iii. Big implications for SoL forum shopping!
E. The Specialized Problem of Nationwide Process
a. Omni Capital Intl v. Rudolf Wolff & Co. (p. 253) (1987) D (NY corp) v. 3rd party Ds
(Britain) in federal court in LA
i. Issue: Does the federal court have personal jurisdiction over 3 rd party Ds under LAs long arm
statute (or a federal statute) and is this consistent with the DPC of the 5 th Amend?
ii. Holding: The federal court does not have personal jurisdiction over British Ds because there
is not federal statute that authorizes it and the LA long arm statute does not reach them. The
court does not answer the constitutional question.
b. Rule 4 (k)(2) overturns Omni
i. District courts have world-wide jurisdiction over Ds in federal question cases, if the D is not
otherwise subject to jurisdiction in any state
ii. P must show that the D is not subject to personal jurisdiction in any state, while the D must
show that he is subject to jurisdiction in some other state
iii. Exercise of jurisdiction still must be consistent with the DPC of the 5 th Amend
1. Minimum contacts aggregate contacts theory foreign D needs only sufficient
contacts with the U.S. as a hole
2. Reasonableness not clear that due process requires this additional consideration once
sufficient aggregate contacts are found
a. Section 1404 transfer to a more convenient forum
F. Notice and the Mechanics of Service of Process
1. The Constitutional Requirement of Notice
a. The DPC requires that notice be given to the D before jurisdiction may be lawfully asserted
b. What notice is required?
i. Mullane v. Central Hanover Bank & Trust Co. (p. 267) (1950) an action to settle the
accounts of a common trust fund in NY; beneficiaries not all residents of NY; notice of this
action was published in a newspaper in accordance with NY law
1. Issue: Does this form of notice violate the DPC?
2. Holding:
a. No- this type of notice is sufficient for the beneficiaries whose interests or
addresses are unknown.
b. Yes this type of notice is inadequate as to those whose addresses and interests
are known because under the circumstances it is not reasonably calculated to
reach those who could easily be informed by other means (notice by mail is
fine; personal service is not required)
3. when notice is a persons due, process which is a mere gesture is not due process
4. Principle: Notice must be reasonably calculated under all circumstances to apprise
interested parties of their pendency of the action and afford them the opportunity to
present their objections
a. Look at the states interest and the beneficiaries interest. Then, look at the
burdens on the state (in sending notice) and the burdens on the beneficiaries (in
receiving) notice and identify any mitigating factors
b. Is the method of notice a reasonable way to actually reach the individuals
(when one actually wants to reach them)?
c. The nature of the action is relevant to a determination of the specific manner of
notice
d. If the name of an individual with a substantial property interest at stake is
known or is reasonable ascertainable, an effort must be made to notify that
party by mail or personal service

11

2. The Mechanics of Service of Process

a. Service of process the procedure by which a party is given notice of the commencement of a
lawsuit
i. Service delivery to the party
ii. Process the thing served (a paper giving the party info about the suit commenced)
1. Summons and/or a complaint
b. Structure of Rule 4
i. The summons and provisions for service
1. 4(a) form
2. 4(b) issuance
3. 4(e) service upon individuals
4. 4(g) service upon infants and incompetents
5. 4(h) service upon corporations and other associations
6. 4(j) service upon the U.S. as a D
7. 4(l) proof of service
8. 4(m) time limits of service
ii. Waiver of service
1. 4(d) P sends D written request for waiver of service, including prepaid means of
complying w/ the waiver require
2. Failure to comply w/ the waiver results in imposition of costs of subsequent service on
D
iii. Service in a foreign country: 4(f)
iv. Territorial limits of service: 4(k)
c. State Service of Process Statutes may differ from the federal approach in important aspects
d. Immunity from process
i. Certain persons may be immune for various reasons
e. Service of Process and Statutes of Limitations
i. P must commence the action before the applicable time period has run out
G. Local Actions, Venue, Forum Non and Transfer
a. Venue rules determine where w/in state or federal system the lawsuit will take place
i. Often thought of as being concerned only with the convenience of trial
1. The Local Action Rule Suit can only be brought in the county or district in which the land is
situated
2. Formal State and Federal Venue Statutes
a. Venue Rules in State Courts
i. Determine the appropriate location of a lawsuit within a particular state
ii. Statutes use a variety of criteria including the residency of one or both parties and where the
events occurred
b. Venue Rules in Federal Courts
1. 28 USC Section 1391 general default venue statute (as opposed to looking at venue
provisions that govern particular federal claims)
a. Operate intra-jurisdictionally to allocate a case within a multidistrict state and
inter-jurisdictionally to allocate a case within the nationwide federal judicial
system
b. Venue is tied to place of residence or where a substantial part of the events or
omissions giving rise to the claim occurred.
i. Corporations broad def. of residence
ii. Individuals more limited def of residence
c. Venue of last resort

12

i. Diversity cases Any district in which any D is subject to personal

jurisdiction at the time the action is commenced
ii. Federal question cases Any district in which any D may be found
1. May be found = actual presence
2. Forum Non Conveniens
a. A discretionary doctrine which further restricts a Ps ultimate selection of
forum and provides a D with some counter-control over where a suit may be
brought
i. Attempts to direct the litigation to a convenient, if not the most
convenient, forum
b. Piper Aircraft v. Reyno (p. 293) (1981) victims representatives of an
airplane crash in Scotland brought a wrongful-death action against U.S.
manufactures; action was ultimately transferred to PA district court; Ds moved
to dismiss on the ground of forum non conveniens; lower court granted the
motion; Court of Appeals reversed
i. Issue: Did the Court of Appeals err in reversing the lower courts
decision on the basis that dismissal is never appropriate where the law
of the alternative forum is less favorable to P?
ii. Holding: Yes! Only if the remedy provided by the alternative forum is
so clearly inadequate or unsatisfactory that it is no at remedy at all
should it be given substantial weight
iii. Rule: There is a strong presumption in favor of Ps choice of forum
that may be overcome only when the private and public interest factors
clearly point towards trial in the alternative forum (this strong
presumption applies only when the P is a resident or citizen of the
U.S.)
1. Private interests
a. Location of evidence, witnesses, ability to implead 3rd
party Ds
2. Public Interests:
a. Alternative forums versus chosen forums interest in
the suit
i. Deterrence value, etc.
ii. Congestion in court
3. D has the burden of demonstrating that the forum is not
convenient
c. Stangvik v. Shiley Incorporated (1991) P (Norwegian and Swedish citizens)
suing Ds (CA corp.) in Ca state court for defective heart valves; Ds moved to
dismiss on ground of forum non-conveniens
i. Holding: The balance of public and private interest favors the Ds so the
motion to dismiss is granted
d. Dow Chemical Co. and Shell Oil Co. v. Domingo Alfaro el at. Ps (Costa
Rica) v. D ( TX)
i. Ruled that Ps could sue in TX courts
ii. Wide ramifications of courts ruling
1. Dire economic predictions
2. Court congestion
3. Colonialism? Should we be imposing the values of our judicial
system on another country?
4. But, we do not want to let corporations avoid accountability!
e. Guidelines

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i. Burden is on the D to show forum is inconvenient

ii. Presumption in favor of Ps forum choice
1. Not if P is non-US
iii. Presumption of convenience in Ds place of residence (place of
incorporation or PPB)
1. Presumption is not conclusive (Stangvik) may be overcome
by evidence that the alternate jurisdiction is a more convenient
place for trial of the action
iv. No transfer where P lacks an effective remedy in alternate forum
1. Very low threshold (Piper)
v. Attachment of conditions to the transfer
1. Acceptance of jurisdiction
2. Make available witnesses and/or documents
f. Relationship between forum non conveniens and personal jurisdiction
i. Is the doctrine redundant?
g. State Forum Non Conveniens Doctrine
i. Piper was an application of federal forum non conveniences doctrine
ii. Some states have rejected the doctrine while others have accorded
different weight to the various factors that are considered in deciding
whether to dismiss
1. E.g. FL refuses to dismiss if one of the parties is a state
resident
iii. Differences in state and federal applications of the doctrine might
bear on the selection of a state or federal court as the forum
3. Transfer Within the Federal Court System
a. 28 USC Section 1404 (a) provides for transfer from one federal district court
to another fed. court where the suit could have been brought as an alternative to
outright dismissal
b. Courts have broader discretion to transfer an action under 1404 than they have
for dismissal under forum non b/c transfer is less drastic than outright dismissal
c. Transfer is proper even in the absence of personal jurisdiction over D in the
initial forum Goldlawr (p. 316)
d. Hoffman v. Blaski (p. 309) (1960) P (IL) v. D(TX) in TX District Court; D
moved to transfer to action to an IL District Court even though P could not
have brought it there
i. Holding: No transfer b/c against the plain meaning of the words
where it might have been brought
ii. This decision has received much criticism and some courts have
attempted to apply its rule as narrowly as possible
e. The Applicable Law on a Section 1404 Transfer
i. The law selected by the transferor forum continues to apply after a
Section 1404 transfer Van Dusen (p. 314)
1. Idea that one should not get a change of law bonus for a
change of venue convenience is the only thing that should be
taken into account
f. Ferens et ux. V. John Deere Co. (p. 317) P(PA) v. D (DE/IL) in PA District
Court (diversity) for contract and warranty claims; P could not file tort action
in PA because 2 year SoL had expired so brought a tort action in Miss. (6 year
SoL); P moved for a transfer to federal court in PA on the ground that PA was a
more convenient forum; motion was granted and the PA district court later
invoked the 2 year SoL and dimissed Ps tort action

14

i. Issue: Must the transferee court follow the choice of law rules that
prevailed in the transferor court when the P moves for the transfer and
not the D?
ii. Holding: Yes! Van Dusen (law applicable to a diversity case does not
change upon a transfer initiated by a D) is precedent and applies when
the P moves for a transfer as well. Thus, a transfer under 1404 does
not change the law applicable to a diversity case
1. must apply the same law state court where diversity suit was
brought would have applied
2. Three reasons
a. 1404 should not deprive parties of state-law
advantages that exist absent diversity jurisdiction
i. Dont want cases to be treated differently just
b/c they wind up in federal court based on the
accident of diversity of citizenship
b. 1404 should not create multiple opps for forum
shopping
c. The decision to transfer under 1404 should turn on
considerations of convenience only
3. More considerations
a. Foresight and judicial economy
i. Would be excess litigation and uncertainty
4. Dissent
a. Not Congress intent
b. Encourages forum shopping between federal and state
courts in the same jurisdiction on the basis of
substantive law
i. The use of PA federal court instead of PA state
court in order to obtain an application of a
different substantive law just what Klaxon
was trying to prevent
c. P gets to have his cake and eat it too!
Chapter 3
III. Subject Matter Jurisdiction
A. Federal vs. State courts
1. state courts: courts of plenary subject matter jurisdiction
2. federal courts: courts of limited subject matter jurisdiction
a. jurisdiction must be conferred by Article III or Congressional statute
B. Diversity Jurisdiction
1. Definition: fed. courts have jurisdiction over cases between citizens of different states or citizens of states
and citizens of foreign states when amount in controversy is over $75,000
2. Purpose: to prevent bias against out-of-state citizens
a. Exceptions: no DJ for probate or domestic relations cases
3. Issue: Should we eliminate federal diversity jurisdiction to save money and solve the budget crisis?
(Anthology readings)
a. Reasons to eliminate DJ:
i. Federal judges subject to political pressure

15

ii. Federal courts dont uniformly apply fed. law

iii. State courts better than fed. courts at applying state law
iv. Fed. courts dont create precedent for state law issues
v. Burdens fed. court system
vi. No more protection against bias b/c juries drawn from same pool as state courts
vii. Provides an excuse not to improve state courts
viii.Limiting federal jurisdiction keeps fed. judiciary more elite
b. Reasons to maintain DJ:
i. Fed. judges more elite decision-makers
ii. Affords forum shopping opportunities that benefit Ps
iii. Policies of individual states might lead to undesirable results
iv. Good for fed. judges to hear diversity cases so they remain familiar w/ common law
v. Bias still exists helps alleviate bias against out-of-staters
vi. Need for complex cases, class action cases
vii. People from out of state dont have opportunity to participate in decision making process re: states
judicial system, while they can participate in decision making process re: fed. system
4. Complete Diversity Requirement
a. One way to limit diversity jurisdiction
b. w/o this requirement Ps would have huge incentive to join out-of-state Ds to end up in fed. court
c. Strawbridge v. Curtis (p. 335): established complete diversity rule
i. Complete diversity rule derived from Article III: Fed. courts have jurisdiction over controversies
between citizens of different states
d. Rule codified in 28 U.S.C. 1332 but only applies rule to civil actions
5. Determining citizenship for purposes of Diversity Jurisdiction
a. Citizenship determined at time lawsuit is filed; subsequent events do not affect DJ
b. Individuals: citizenship based on place of domicile
c. Corporations: citizen of state where incorporated or principle place of business
i. under forum doctrine: if suit brought against corp. in one of its states of incorporation, it would
be treated as if it were incorporated solely in the forum state for purposes of the litigation
ii. different approaches to determining PPB based on district
d. Other artificial entities:
i. Limited Partnership: Carden v. Arkoma Assocs. (p. 345)
(i) Facts:
1. P ltd pshp. organized under laws of Az.
2. general partners not from Louisiana
3. 1 limited partner from La.
4. Brought suit in La. federal court
5. D moved to dismiss based on lack of complete diversity
(ii) Ps argued
1. functional approach: pshp should be treated as corporation; or
2. should only consider citizenship of general partners
(iii) Holding: No complete diversity Court took traditionalist view
1. must consider citizenship of all partners
2. legislature, not courts should determine citizenship of artificial entities for diversity
purposes
(iv) Dissent: Evolutionist view
1. citizenship for DJ should reflect changing business realities
2. only citizenship of general partners should matter
e. Class actions:
i. Only citizenship of class representative matters (Supreme Tribe of Ben-Hur v. Cauble)
6. Freedom to add parties to defeat DJ

16

a. Rose v. Giamatti (p. 356)

i. Facts:
(i) Rose (OH citizen) filed suit against baseball commissioner (NY citizen), MLB (citizen of state
of every team) and Cincinnati Reds (OH)
(ii) Ds sought removal to fed. court based on DJ
ii. Court said Rose had no claim against MLB or Reds fraudulent joinder (see below), so complete
diversity
(i) MLB and Reds had no contractual obligation to Rose to monitor Commissioners acts
iii. D did not waive removal right by defending preliminary injunction
iv. Holding: Removal to federal court granted
b. Ways to prevent parties from bringing in other parties to defeat DJ
i. Nominal parties: adding parties against whom you have no claim
ii. Fraudulent joinder: contriving someone to be a party when they dont have a stake in the litigation;
you have claim but not w/ that party
(i) Court must determine whether there is an underlying substantive law claim against the party
(ii) Decision on this issue is binding
7. Amount in Controversy
a. Required for diversity cases, not for federal subject matter jurisdiction
b. Current requirement is $75,000
c. Determined at time of filing of suit
d. Helps relieve congestion and keep fed. courts more prestigious
e. Zahn v. Intl Paper Co. (p. 374) Ps file class action for property damage caused by pollution from
Ds paper plant
i. Issue: Does each member of class action have to meet amount in controversy requirement
($10,000)?
(i) Aggregation allowed if:
1. 1 person has multiple claims that add up to $10,000
2. multiple parties unite to enforce single claim
ii. Ps also argue that court should have ancillary (supplemental) jurisdiction over claims under $10k
(i) Dissent takes this position supplemental juris. allowed for many other contexts (e.g., for
counterclaims under $10k)
iii. Holding: Court doesnt allow aggregation in this case b/c all Ps have separate and distinct claims
(i) Criticized as hindering efficiency of class action cases
(ii) Zahn rule no longer bars class actions b/c they can be brought in state courts
C. Federal Question Jurisdiction
1. Background and Rationale
a. Article III sets outer limits
i. 28 U.S.C. 1331 and 1332 determine what has been conferred to fed. courts
ii. Congress can supplement fed. jurisdiction by statute
b. Established almost 100 years after diversity jurisdiction
c. Fed. courts better able to and will more uniformly interpret fed. laws
d. Fed. Rules facilitate enforcement of fed. laws
e. Alleviates tension between fed. and state courts
2. Arising Under Federal Law
a. Louisville & Nashville RR Co. v. Mottley (p. 384) Ps sued to compel specific performance of
contract to issue free RR passes to Ps for life as settlement from previous lawsuit. D claimed fed. law,
which forbade the issuing on free RR passes, prohibited them from complying w/ contract.
i. Issue: Arising under federal law?
(i) Look at complaint and what Ps need to allege to succeed
1. P only needed to allege breach of contract; no federal law claim
2. more certain that considering what issues are likely to arise in the case

17

(ii) In this case, fed. law only came into play w/ Ds affirmative defense
ii. Holding: No fed. subject matter jurisdiction
D. Federal Supplemental Jurisdiction
1. One part of lawsuit independently satisfies fed. subj. matter jurisdiction, but other portion does not
a. Cant use to get around complete diversity requirement
b. Previously called ancillary and pendent jurisdiction
2. United Mine Workers of America v. Gibbs (p. 411) P (Gibbs) sued D (UMW) in fed. court
a. Ps has fed. law claim and state law claim:
i. Fed Law: Secondary boycott under Taft-Hartley Act
(i) Fed. subject matter jurisdiction over this claim
(ii) Court dismisses claim for not constituting secondary boycott
ii. State law: Unlawful conspiracy to interfere w/ Ps business and state secondary boycott claim
b. Issue: Can fed. court retain Ps state law claim?
i. More efficient to allow case to go forward than to require P to refile
(i) P would initially have to bring separate suits or bring in state court
ii. Test: whether both claims derive from common nucleus of operative fact consider whether facts
overlap to such an extent that hearing claims together would enhance efficiency
(i) Court has discretion to hear state court claim
(ii) If state issues predominate, fed. court can dismiss
c. Holding: Fed. court can exercise supplemental jurisdiction over state law claim
i. At time of great trust in federal courts, and broad view of same case or controversy
3. Fed courts have power to hear cases through supplemental jurisdiction b/c Article III grants fed. courts
jurisdiction over any case or controversy
i. Treat both of Ps claims as single case
4. Restatement (Second) of Judgments (p. 737): grouping by transaction
a. whether facts are related in time, space, origin, or motivation, whether they form a convenient trial unit,
and whether their treatment as a unit conforms to parties expectations or business understandings
5. Moore v. New York Cotton Exchange (p. 416) P filed federal anti-trust claim against D. D filed state
law counterclaim.
a. Issue: Can fed. court exercise supplemental jurisdiction over Ds counterclaim?
b. Test: whether counterclaim arose out of same transaction which was the subject matter of the suit
i. has a logical relation to the original claim
ii. Essential facts alleged by P constitute part of Ds counterclaim
c. Holding: Fed. court has supplemental jurisdiction over counterclaim
6. Owen Equipment & Erection Co. v. Kroger (p. 423) P (Ia.) filed wrongful-death action against D
(Neb.) in fed. court under diversity jurisdiction. D filed 3 rd party counterclaim against Owen (Ia.). Claim
against original D dismissed, and P files amended complaint against Owen.
a. Issue: Does federal court have supp. jurisdiction over 3 rd party D even though there is no complete
diversity between P and 3rd party D?
i. NO, court treats Owen as original D, b/c P filed amended complaint
ii. No basis for federal jurisdiction against Owen
b. Holding: Supplemental jurisdiction allowed over additional Ds, but not if it threatens complete
diversity requirement
i. D allowed to bring in additional Ds, but not P
7. Finley v. United States (p. 431) P asserted federal claims against FAA and state claims against the City of
San Diego and San Diego Gas Co.
a. Issue: Does federal court have supplemental jurisdiction over state claims?
b. Holding: Court lacked authority to exercise jurisdiction over state claims
i. Gibbs test doesnt extend to claims against nonfederal defendants
ii. Congress responded w/ 28 U.S.C. 1367
8. Current Supplemental Jurisdiction: 28 U.S.C. 1367

18

a. Fed courts have supplemental jurisdiction over claims so related to claims over which fed. courts have
original jurisdiction pursuant to fed. statutes that they form the same case or controversy
b. Exceptions for diversity jurisdiction cases
i. No supplemental jurisdiction for claims brought by Plaintiffs under Rules 14, 19, 20 or 24 (doesnt
apply to claims brought by Defendants)
(i) 14: Third-party Ds
(ii) 19: Compulsory Joinder
(iii) 20: Permissive Joinder
(iv) 24: Intervention
(v) Excludes Rule 23 class actions
c. Fed. courts may exercise discretion in dismissing state court claims if:
i. Raising novel/complex issue of state law
ii. State claim predominates over federal claim
iii. Court has already dismissed federal claim
iv. Other compelling reasons: e.g., efficiency and fairness concerns, court would split claims for trial,
claims would confuse jury
E. Removal
1. Cases originally filed by P in state court can be removed to federal court by D
2. P does not have right to remove
3. Only non-citizen Ds can remove
4. Ability to remove determined by Ps complaint
a. D cannot remove by asserting federal counterclaim
Ch. 4: The Law Applied in Federal Court, pg. 449-558
- 2 legal texts provide the starting point for identifying the law that should be applied in federal courts
o The Constitution
10th Amendment: doctrine of limited federal power. All powers not delegated to the federal
govt should be reserved for the States. Federalism.
Structure of the Constitution: sets aside enumerated powers of each branch of the federal
govt, any powers not enumerated to federal government are outside its powers. Separation of
powers.
Art. III, 1: The judicial Power of the United States shall be vested in one Supreme Court,
and in such inferior Courts as the Congress may from time to time ordain and establish. That
judicial power includes the authority to resolve certain kinds of cases and controversies,
including cases arising under federal law AND cases between citizens of different states.
Diversity cases are not cases arising under federal law, and therefore, even though the
federal courts have jurisdiction (if the amount in controversy is sufficient) the
substantive law that governs the claim cannot be created by Congress since it has no
delegated to power to create state laws (i.e. laws regarding contracts). The federal
court has judicial power to hear the case, even though there is no federal legistlative
power to create the governing law. The question to be addressed here is what law
should be applied in this analogous situation.
o 34 of The Judiciary Act of 1789, now codified as 28 U.S.C. 1652:
The laws of the several states, except where the Constitution or treaties of the United States or
Acts of Congress otherwise require or provide, shall be regarded as rules of decision in all civil
actions in the courts of the United States, in cases where they apply.
Also known as the Rules of Decision Act.
1. The origins of the debate: Swift and Erie. What is the meaning of the laws of the several states?
a. Swift v. Tyson (1842) pg. 451.

19

i. Dispute between D Tyson (NY) and P Swift (ME) about the enforceability of a debt instrument.
P filed a diversity suit in NY. Ds argued that the RDA required the federal court to apply NY
law that P was not a bona fide purchaser.
ii. Holding: General principles of common law of state courts did not constitute the laws of the
several states for the purposes of the Rules of Decision Act, and therefore no conformity with
NY state court decisions required of the NY federal court. The laws of the several states only
refers to statutes (local statutes and the state common law interpreting them) and certain
established local usages of the state.
1. Justice Story wanted the diversity court to provide both a neutral forum and a neutral
law. He thought that the federal courts would evolve their own correct general
common law that later would be adopted by the rest of the states courts because it was
a set of absolute, right rules (natural law view). A court does not make laws but
merely finds the law from evidence in the world, so did not seem beyond constitutional
authority for the federal courts to create law.
2. Holmes: There is no true body of law. Laws derive force not from being right but
from being enforced by a State with the authority to do so. Rules are right because
they are appropriate to that time and place (legal realism).
b. Erie R. Co. v. Tompkins (1938) pg. 454 Justice Brandeis, law ought to be responsive to the conditions
of society (legal realism)
i. P Tomkins (PA) injured when walking along D RR (NY corp) in PA. Tort action P lost his
arm. P sued in NY federal court seeking damages.
ii. PA state law says no duty owed to P, NY law says yes duty owed to P. Therefore, that PA law
NOT applied in this court crucial to Ps recovery.
iii. D argues against Swift that the laws of the several states includes state common law, and
therefore federal court bound by RDA to follow PA law here. No federal tort statute.
iv. Issues:
1. Does the RDA (or any applicable federal statute) require that federal courts be bound
by state common law (Matters of clearly substantive law)? (Issue of statutory
interpretation!)
2. If RDA doesnt compel following state law, would it be constitutional for fed courts to
create own law?
v. Result: RDA does require the court to follow PA common law.
1. The laws of the states should be interpreted to mean that unless federal law is
controlling (acts of Congress or cases arising under federal question), the federal courts
exercising jx in diversity cases should apply the laws of the states, unwritten and
written.
2. Court did not decide RDA unconstitutional, decision technically based on statutory
interpretation grounds so that the Court could avoid unnecessary constitutional
adjudication.
3. The Bottom Line: In diversity cases, federal courts must apply the law that would be
applied by the courts of the state in which they sit. Job to apply state common law and
not create general common law. Justice Brandeis rejects Justice Storys
interpretation of the RDA and not the RDA itself.
vi. Justifications for overruling Swift:
1. Constitutional concerns if we interpret the statute to allow fed common law making
then we are running afoul of a Const prohibition. Legitimacy issues! (Dictum, yet
strong dictum!)
a. Constitution doesnt empower Congress or federal courts to declare substantive
laws of states (not by CC, Art I power to ordain/establish lower federal courts,
or necessary and proper clause). No wholesale federal lawmaking allowed by
any branch of the federal government (Federalism).

20

b. Also, federal courts do not have full power to create law, much of it given to
Congress (Separation of powers). RDA a limitation on the law making powers
of the judiciary.
c. However, at time of Constitution, very little state law existed. Perhaps RDA
did actually mean general common law.
2. Change in jurisprudential view of the law.
a. Wrong that there is one correct law out there, change from natual law
jurisprudence to legal positivism. School acknowledges all legal rules
represent situated choices by lawmakers
3. Fairness concerns (forum shopping, discrimination)
a. Swift also gave an incentive to forum shop in that Ps would reincorporate or
move to another forum in order to create diversity that would allow them to
choose bn state and federal common law. The person able to choose the federal
forum would have an advantage under Swift. Discrim to citizens by noncitizens, bc in a diversity action the non-citizen gets to choose the court. If law
is different and can choose fed crt or state court, distinct advantage for the noncitizen P over the citizen P.
b. Swift also created legal uncertainty difficult to predict what laws you should
conform to because the law would change if a party happened to be diverse
from you. However, Erie still allows for the situation that you may be
amenable to different states laws.
c. Also, D who is sued in fed crt in their own state cant remove (cant remove on
diversity grounds if in your home state), so here Ps have choices that Ds
dont. When a diversity suit is brought against a D in his state, P can shop
between state and federal court and D is stuck. Promoted forum shopping
between State and Federal courts which has only gotten worse since state
choice of law doctrines have changed. However, federal courts under Eerie
bound by both state substantive law and a states choice of law as well.
2. Plain meaning/textual the law is the law, no matter who makes it (courts or
Congress), both statutes and common law.
4. New discovery, intent of Judiciary Act to encompass all laws and not just statutory
laws.
vii. After this, if federal courts get a case of first impression under state law, supposed to try to
figure out how the state courts would have decided.
2. Determining the Procedural Law Applicable in Federal Courts: Clearly courts had to apply substantive state
law, but what about procedural law?
a. Outcome Determination Supreme courts first major effort to distinguish substantive laws, which
were binding on federal courts, from procedural laws, which federal laws could develop independently.
i. Guaranty Trust Co. of New York v. York (1945) pg. 471
1. P beneficiary of trust, brings diversity suit in federal court with claims of breach of
fiduciary duty, fraud, and breach of trust on D bank serving as trustee on behalf of note
holders of NY corporation.
2. Time has passed, too late for P to bring suit in state court.
3. Issue:
a. Does the RDA require the federal court be bound by a states Statute of
Limitations?
i. Lang of RDA act to focus on is regarded as rules of decision. Is a
Statute of Limitation substantive, or procedural law, or both?
b. If not, would it be Constitutional for federal courts to create their own rule,
such as the doctrine of laches? Sources of enumeration of this power?
i. Commerce Clause? No.

21

i. Article I, section 8: Power to create tribunals? Perhaps federal

government should have power to structure their own tribunal system
(if not their own laws).
ii. Art III diversity jx + Necessary and Proper clause? Same argument.
Perhaps necessary for federal government to make rules that contribute
to the efficient and fair functioning of the tribunal system.
4. Result:
a. Statute of Limitation considered a rule of decision such that a federal court
must follow it. State statute of limitation must be applied and therefore P
cannot bring suit. Not decided on substantive/procedural ground.
b. Outcome determination test. If it affects the outcome of the case then it is a
rule of decision and the federal court must follow state law. Court wants to
prevent diverse parties from gaining unfair advantages simply because they can
choose federal court. Want predictability and uniformity between cases tried in
state/federal law.
c. But isnt every procedural rule outcome determinative if you dont follow it?
How do we know how to interpret this rule? Concern with forum shopping.
Ex ante will someones choice of the forum be affected by the S of L
applied? If yes, then outcome determinative.
d. This case seemed to extend Eerie well beyond the area where application of
state law was compelled by the US Constitution. Before, federal courts and
Congress didnt have the power to create tort law and so had to apply state law.
But here there is authority to create a rule of federal courts! (power to establish
lower courts and laws that are Necessary and Proper to make them function
well). This is a policy decision!
5. Dissent:
a. Should be cautious about extending Erie, Congress hasnt yet and so neither
should we.
b. Analyzing State and Federal Interests How should a court handle practices that less clearly implicate
the outcome of a case but nonetheless seem important?
i. Byrd v. Blue Ridge Rural Electric Cooperative, Inc. (1958) pg. 481 (Matters of procedure
where applying separate federal rule is unlikely to affect the outcome)
1. Should federal court be bound by a State law requiring that a statutory employee for
purposes of the Workmans Compensation act be determined by a judge (SC state law)
or is it okay if this issue is decided by a jury (federal custom/practice)?
2. Result: Here, the likelihood of a different outcome in federal vs. state court not so
strong as to require the federal practice of jury determination yield to the state rule.
Brennan says you must conduct a balancing test of interests in addition to the outcome
determination test. Even though outcome determination test addresses concerns about
forum shopping, there are other concerns, such as the strong federal interest in how the
constitution structures the court system (7th A has not been incorporated into the 14th A
and applied against the states.) Says state interests in having judges decide not as great
as federal interests. Elevates federal interest by allying it with the constitution. Matter
of procedure as to which federal court was not Const compelled to apply the state
practice.
c. The Impact of the Federal Rules of Civil Procedure
i. The Rulemaking Process:
1. Rules Enabling Act of 1934, currently codified as USC 2072:
a. Authorized the Federal Rules of Civil Procedure. A 20 year effort on the part
of the ABA to create uniform rules of federal civil procedure. Gives the
Supreme Court power to prescribe general rules of practice and procedure as

22

long as they dont abridge/change any substantive right. All these rules are
subject to Congressional veto.
2. Layers of Review:
a. The Advisory Committees are composed of judges, lawyers, etc appointed by
the Chief Justice. These committees specialize in a type of law and draft
proposals. These are reviewed by both the Standing Committee and the
Judicial Conference, and then submitted to the Supreme Court, who then
approves and submits them to Congress. Congress either does nothing, and
they become law, or affirmatively rejects them.
3. Status of the Federal Rules
a. They have the status of a congressional statute.
4. Criticisms
a. Rulemaking process too closed, lack of public participation, role of Supreme
Court has rule maker and adjudicator weird. Now more open to the
public/scrutiny.
5. Local Rules
a. Although uniformity the reason for the Rules, there is sensitivity to differing
procedural concerns of distinct districts and circuits. The lower federal courts
have the right to create procedural rules for their respective routs but they must
be consistent with the Rules.
6. Validity under the Federal Rules
a. There has never been a challenge that these rules have abridged, enlarged, or
modified a substantive right, violating the Enablng Act mandate.
ii. Hanna v. Plumer (1965) pg. 492
1. P served process on D by leaving summons at his home with his wife as required by the
Federal Rules. MA state law required in hand service. If apply federal law, case will
go on. If apply state law, case cannot go forward because statute of limitations has run.
Here a federal rule in place that is in conflict with state law!
2. Result:
a. This change in rules would not really be outcome determinative bc would not
compel forum shopping, so Erie does not require federal court to substitute the
state law for its own.
b. ALSO, a different analysis for cases in which an official Federal Rule conflicts
with state law, because the Rules are officially promulgated by the Supreme
Court (through the Rules Enabling Act) and implicitly endorsed by Congress.
REA authorized Congress to prescribe general rules of practice and procedure
for the federal courts.
i. Art III and N and P Clause provide broad Const authority to make rules
governing the practice and pleading in federal courts and regulate any
matters that are arguably procedural (as long as it doesnt impinge on
substantive rights).
ii. To invalidate one of the Rules, the Court would have to conclude that
the Advisory Committee, the Supreme Court, and Congress all erred in
their judgment that the rule could validly be applied in Federal Court.
iii. Hanna: track assignment testis there a Rule/statute/const provision
that governs process in the federal courts? If there is not, then we do
Guaranty Trust and Byrd. If there is a rule/statute/const provision we
follow it, as long as there is authority for the adoption of the law. Is it
rationally classifiable as at least partly procedural?
iii. Framework for determining when the federal court must defer to state law in case of conflicts:
1. Conflicts between a Federal Const Provision and State Law

23

a. Const the supreme law of the land. If the Const mandates a practice different
from state law, the Const requirement prevails (Think 7th A).
2. Conflicts between a Federal Statute and State Law
a. Federal statutes are also the Supreme law of the land, if they are valid (i.e. as
long as Congress has the authority to enact the statutes, and they do as long as
they are arguably procedural).
3. Conflicts between a Federal Rule and State Law
a. The Federal rule applies if it is valid. I.e. as long as arguably procedural and
dont modify a substantive right.
4. Conflicts between a Federal Judicial Practice and State Law
a. If relate to conducr of litigation only choose state law if outcome determinative
in the sense that a separate federal practice could lead to forum
shopping/ununiform administration of the laws.
d. Track Assignment Determining the Existence of a Pertinent Federal Law
i. Direct Collision Between State and Federal Rules when is there a direct conflict between a
federal rule/statute and state law?
1. Gasperini v. Center for Humanities, Inc.
a. No conflict found bn Federal Rule 59, which specifies that new trials may be
granted in federal court for the reasons for which new trials have heretofore
been granted in actions at law in the courts of the US and a state statute which
set a specific, stringent standard for review of damage awards.
b. The court resurrected Byrd. Approved Byrds emphasis on the importance of
the federal interests as a factor in making the Erie choice. So, where a federal
statute or rule is not directly implicated, weighing important federal policies
against the uniformity policy is part of the analysis.
3. Anthology
Chapter 5
V. Pleading, Discovery, and Adjudication
A. History of Pleading
1. The English Writ System common law courts
a. Writs corresponded to particular form of action
b. Pleadings very detailed b/c no discovery or summary judgment
c. Only remedy was monetary damages
2. English Courts in Equity
a. Provided remedies not available in writ system
b. More liberal pleadings than writ system and more access to witnesses and evidence
3. Code Pleading: P simply had to allege dry, naked, actual facts that stated a cause of action
a. Difficult to achieve proper balance between alleging facts and stating law
4. Modern Notice Pleading: Fed. R. Civ. P. 8
a. Rules embed pleading among other procedural devices
b. 3 Primary Purposes of pleadings:
i. Notice
ii. Discovery framing
(i) Pleadings set forth scope of discovery and indicate which facts are relevant for trial
(ii) Pleadings allow parties to determine which facts are contested
iii. Screening
(i) Pleading requirements form threshold for being able to file claim

24

(ii) Rule 11 requires attorney, when signing pleading, to certify that theres a factual and legal basis
for the claim
B. The Complaint
1. Requirements: must contain (1) short and plain statement of grounds for jurisdiction, (2) short and plain
statement of claim, showing that pleader is entitled for relief, and (3) demand for judgment
2. Have to state all elements of claim
a. Burden of pleading usually same as burden of proof at trial
b. How do you know if affirmative defense must be alleged in complaint?
i. Rule 8(c) tells us certain things are affirmative defenses
ii. Could depend on how likely it is that defense will be used, which party has information or
preference for placing burden on D
c. Rules allow for amendments to complaints, so can amend if unclear what is required
3. If unsure about the facts, Rule 8(e)(2) allows party to set out two or more alternative bases for claim
i. pleading not insufficient by failure to state other alternatives
4. If unsure about the law, Rule 11(b)(2) allows claims warranted by existing law or by nonfrivolous
argument for the extension, modification, or reversal of existing law or the establishment of a new law
C. Rule 11: Signing of Pleading
1. Garr v. U.S. Healthcare, Inc. (p. 584) 3 attorneys, Malon, Levin and Sklar, filed securities suits against
D. First attorney, Malone, researched the basis of his claim before filing. Levin and Sklar piggy-backed off
of Malones filing and performed no independent research.
a. Issue: Were Rule 11 sanctions against the attorneys appropriate?
i. Prior Rule 11 required that an attorney makes a reasonable inquiry into the contents of the pleading
and conclude that it is well grounded in fact and warranted in law
(i) Sanctioned attorney required to pay other sides attorneys fees
ii. Malone violated Rule 11 by failing to investigate into whether his client could adequately and fairly
represent the class (his clients son was connected to the D) did not appeal
iii. Levin and Sklar violated Rule 11 by failing to inquire into whether complaint was proper; relying
on Malones investigation not a reasonable inquiry
b. Holding: Rule 11 sanctions appropriate
c. Dissent: Shouldnt sanction attorneys, even if they failed to make an investigation, if there is a factual
basis for the complaint
2. Current Rule 11:
a. Can allege facts as long as you specifically identify allegation as likely to have evidentiary support after
a reasonable opportunity for further investigation
b. P has 21 days after filing complaint to retract or correct pleading
c. Sanctions limited to what is reasonable to deter future conduct
d. Sanctions paid to court, not opposing counsel, unless special showing
D. The Answer
1. Answer responds to complaint, motions ask judge to do something before filing answer
2. Rule 12: Pre-Answer Motions (See examples p. 614)
a. Rule 12(c): If you dont file any pre-answer motion, can file motion for judgment on the pleadings
b. Rule 12(e): Motion for more definite statement use if complaint didnt provide enough information to
allow you respond
c. Rule 12(g): Must consolidate defenses into single motion, otherwise defenses waived, except as
provided in 12(h)(2)
d. Rule 12(h)(1): Defenses of lack personal jurisdiction, insufficiency of service or insufficiency of service
of process waived if not raised by pre-answer motion
e. Rule 12(h)(2): Defenses of failure to state a claim, failure to join party under Rule 19, and failure to
state legal defense to claim can be made at any time
f. Court can dismiss for lack of subject matter jurisdiction at any time
3. Requirements for Answer:

25

a. Paragraph by paragraph response to complaint

b. D must make reasonable investigation into allegations of complaint
c. All defenses must be included; affirmative defenses must be stated affirmatively
i. Early disclosure of defenses promotes fairness and judicial economy
ii. Rule 15 allows amendment to pleadings if defense omitted
d. Answer should include any counterclaims (Rule 13)
E. Discovery
1. Functions: (1) Avoids surprise at trial; (2) Promotes settlement; (3) Levels playing field; (4) Enhances
legitimacy; and (5) Improves screening process
2. Discovery Rules
a. Rule 26: Scope of discovery
i. 26(a): Required initial disclosure
(i) party need only disclose information it will use in support of its claim/defense, not information
to support other sides claim
ii. 26(b): Scope and limits can seek anything relevant to claim or defense of any party
(i) Under 26(b)(2), court can limit scope of discovery if unreasonably cumulative/duplicative or
obtainable from other source, if party seeking discovery has had ample opportunity to obtain
materials sought, or if burden in producing discovery outweighs its likely benefit
iii. 26(c): Protective orders
iv. 26(d): Timing and sequence
v. 26(f): Discovery conference and plan
vi. 26(g): Sanctions
b. Rule 30: Depositions
c. Rule 33: Interrogatories
i. Party obligated to make reasonable investigation to determine the answer
ii. Allows party to probe opponents legal theory and evidentiary support
d. Rule 34: Document Production
e. Rule 35: Physical Examination
f. Rule 36: Requests for Admission
g. Rule 37: Sanctions
3. Discovery Devices
Depositions
Interrogatories
Requests for
Physical &
Requests for Admission
(Rule 30)
(Rule 33)
document
Mental
(Rule 36)
production
Evaluations
(Rule 24)
(Rule 35)
Towards
Party or any
Parties only
Party; need
Party (can
Party
whom?
witness
subpoena per
affect how
Rule 45 for
you choose
nonparties
parties)
How
To party directly To party directly
To party; need
Courts
To party
requested?
(dont need court (w/o leave of
subpoena for
permission
approval)
court if no more nonparty
reqd b/c of
Subpoena may be than 25)
intrusivenes
reqd for
s
nonparty
Any limits?
Court permission Court permission Keep in order
Must show
Need leave of court if
reqd if greater
reqd if over 25
good cause
serving out of sequence;
than 10 depos.,
or out of
If you deny something
2nd time for
sequence; leave
that is fairly
deponent, or
to serve addl
straightforward to prove,

26

Who
responds?

want to depose
out of sequence
(Rule 26(d))
Party or witness

limited by Rule
26(b)(2)
Attorney

Attorneys
guide party

Party

responsible for cost of

proving it at trial (R
37(c))
Attorney (may want to
admit to avoid jury
hearing proof and limit
damages)

4. Limits on Discovery
a. Attorney-Client Privilege
i. Protects communications between attorney and client concerning legal representation
(i) Can waive by communicating w/ third-party or but unintentional production of discovery docs.
ii. Reasons to have:
(i) prevents client from lying to attorney b/c of mistaken belief about the legal implications of her
actions
(ii) attorney in best position to counsel client that its in her best interests to tell the truth, or to
persuade her to tell the truth even if not in her best interests
iii. Upjohn Co. v. United States (p. 647) Ds general counsel interviewed Ds employees in
connection w/ legal investigation
(i) Issue: Were communications w/ lower-level employees privileged?
(ii) Court rejected lower courts control group test as too narrow
(iii) Purpose of privilege to encourage clients to make full disclosure to their attorneys and to enable
attorneys to provide informed legal advice
1. Communication w/ lower-level employees necessary to attorneys ability to effectively
counsel its client
2. Employees knew at time of communications that they were conducted as part of legal
inquiry
3. Employer directed employees to give statements as part of their job duties
4. Attorney and client must be able to predict which communications will be protected
(iv) Doesnt matter that it would be more convenience to other side to obtain privileged materials
than to interview witnesses directly
(v) Holding: Communications between attorney and clients employees privileged
b. Attorney Work Product Privilege
i. Protects materials prepared in anticipation of litigation or for trial
ii. Hickman v. Taylor (p. 657) Ds tugboat sank, and Ds attorney Fortenbaugh, took statements of
survivors and summarized statements in anticipation of litigation
(i) Issue: Are Fortenbaughs statements from survivors and his summaries of the statements
privileged?
1. Not protected by attorney-client privilege
2. Policy Concerns:
a. Efficiency:
i. encourages attorneys to write things down and can work w/o fear of disclosure
ii. prevents free-rider problem
iii. would be inefficient to have attorneys testify on the credibility of their own work
b. Fairness:
i. Demoralizing for attorneys to have to disclose their work
ii. Parties could negotiate to disclose if beneficial to both parties
iii. Party can achieve disclosure by showing that he cannot achieve materials by other
means or that he would be suffer hardship or injustice if the materials are not
produced

27

c. Distribution: Forced disclosure could level playing field in cases of corporate D against
individual P, but rule must be applied uniformly
d. Legitimacy: forced disclosure would undermine legitimacy of system
(ii) Holding: Materials protected by attorney work product privilege
iii. Rule 26 (b)(3): work produced in anticipation of litigation or for trial only discoverable upon
showing that requesting party has substantial need of materials and is unable to obtain substantial
equivalent of the materials by other means w/o undue hardship
(i) Mental impressions, conclusions and legal theories are absolutely protected
c. Sanctions
i. Rule 26:
(i) 26(b): limits discovery and provides for protective orders
(ii) 26(g): Sanctions if discovery request is unreasonable, unduly burdensome, or for improper
purpose or if response was not the result of a reasonable inquiry
ii. Rule 37: Sanctions and Motions to Compel
(i) 37(a): Motions to compel
1. movant must have made good faith effort to secure disclosure w/o court action
2. applies when party doesnt answer or when answer evasive/incomplete
3. if motion granted, moving party awarded attorneys fees
4. if motion denied, moving party must pay other sides attorneys fees
(ii) 37(b): Sanctions for failing to respond when ordered
(iii) 37(d): Sanctions for not showing up at deposition or failing to respond to interrogatories
F. Trial by jury
1. Right to jury trial for civil cases enshrined in 7 th Amendment
2. preserves right to trial by jury at common law which only applied to matters at law looks back to 1789
3. Pros
a. Perceived legitimacy
b. Judges may be susceptible to political pressure
c. Democratizes system by allowing different groups to be represented
d. Educates people about the legal system
e. Better to require multiple people agree than to rely on 1 persons opinion
f. Juries have more flexibility to bend legal rule to come out w/ the right outcome
4. Cons
a. Juries may not understand complex issues
b. More costly
c. Juries may based their decisions on the wrong reasons, e.g., sympathy
d. Jury verdicts dont provided findings of fact to give insight into decision-making process (unlike bench
trials)
i. But can insist on special verdict, so that jury has to answer specific questions
5. Different standards of review
a. Jury trial: no supporting evidence from which reasonable jury could find for prevailing party
b. Bench trial: clearly erroneous standard
6. Jury selection process allows attorneys to dismiss potential jurors for cause or by preemptory challenges
G. Summary Judgment
1. dispenses w/ trial when, after discovery, there isnt enough admissible evidence to generate genuine issues
as to material facts
a. occurs after discovery process has been completed
2. Celotex Corp. v. Catrett (p. 689) P sues multiple asbestos manufacturers, including D, for wrongful
death of her husband. Issue as to whether Ps decedent was exposed to Ds asbestos.
a. Issue: Should summary judgment for D be granted?
b. Burdens of Proof
i. burden of proof = burden of production + burden of persuasion

28

(i) P has burden of proof must show that Ds asbestos caused disease
(ii) For summary judgment motion, D has burden of proof must show no genuine dispute re:
material facts
c. How does D discharge burden of proof for summary judgment motion?
i. Earlier view was that moving party had to negate other sides evidence
ii. Court held that moving party didnt need to negate other sides evidence, but just prove that other
side doesnt have any admissible evidence
(i) Once moving party meets its burden, non-moving party must show that there is admissible
evidence to present genuine issues of material fact
d. Holding: Remanded to Court of Appeals for determination consistent w/ opinion
3. Judgment as Matter of Law same standard as for summary judgment, but used after 1 party has presented
its case at trial
4. Court can grant new trial under Rule 59 if verdict against the weight of the evidence, damages inappropriate
or where otherwise necessary to prevent injustice
H. Bone, Law & Economics
1. Normative Economics: which law will result in the best/most efficient outcome?
a. Vs. Positive Economics: descriptive and predictive based on presumption of rational economics
2. Which pleading rule is will lead to more accuracy?
a. Notice: will end up litigating potentially frivolous lawsuits
b. Strict Pleading: some meritorious claims wont get filed; deters both meritorious and frivolous filings
i. Increases process costs, but decreases likelihood that suit will be filed
ii. Should be applied selectively, only in suits where Ps are likely to be uninformed about the merits
and can easily investigate
c. Pleading rule doesnt matter when P is informed and cost of investigation is high
3. Discovery
a. Discovery can facilitate settlement if it causes parties to converge on Ps estimate of likely recovery
b. Are accuracy gains of discovery greater than the costs?
i. Forces us to consider incremental value of discovery
ii. Have to consider whether prospect of discovery will lead to settlement
iii. Discovery only warranted when increased value of accuracy at trial plus any deterrent value is at
least equal to the total costs on both sides of carrying out the discovery
c. Discovery can increase/decrease the likelihood of settlement depending on what information would be
disclosed in its absence
i. If no discovery, parties still have incentives to share information
(i) Will share favorable information to get other side to revise its recovery estimate, but incentive
diminished if other side will be skeptical of information
(ii) Will share unfavorable information, b/c if you dont, other side will think your case is worse
than it is
1. no incentive to disclose if party thinks other side will be unable to get information
d. Costs of Discovery
i. Pre-discovery settlements may be inaccurate if 1 side has more information
ii. Discovery abuse may occur b/c easy for 1 side to deflect costs onto other side
(i) Attorneys can use discovery to rack up fees
(ii) Discovery for its impositional value rather than its informational value unwarranted
(iii) Abuse leads to prisoners dilemma neither side has incentive to cooperate
e. Problems w/ proposed discovery reforms
i. Mandatory disclosure may lead to over-disclosure, less efficient than discovery requests, parties
can still abuse
ii. Cost-shifting unfair when 1 party has most of the information, parties can inflate costs
iii. Hard limits dont reflect realities of litigation

29

Chapter 6
VI. Prior Adjudication and Preclusion
A. Overview:
1. Provides finality in legal system
2. Exceptions to preclusion similar to writ of habeas corpus in criminal cases
3. Claim and issue preclusion is judge made law
4. Courts apply the preclusion law of the original forum
B. Claim Preclusion
1. Definition:
a. previously called res adjudicata
b. rule of compulsory joinder of claims on threat of forfeitures
c. Fed. Rules do not provide for compulsory joinder of claims, but have very liberal permissive joinder
rules, which may function as compulsory joinder rules for purposes of claim preclusion
2. Reasons for Claim Preclusion
a. Ensures that decisions are stable
b. Efficient and alleviates burdens on courts
c. Protects parties against addl litigation
d. Prevents double recovery
3. Same Claim
a. Rush v. City of Maple Heights (p. 727) (1958) Issue: Did Ps first claim against D preclude her
from bringing the second?
i. P injured when her motorcycle crashed on Ds bumpy street, and brought 2 separate claims:
(i) property damage in municipal court for $100 P wins
(ii) personal injury in superior court for $12,000
ii. Test: whether Ps actions arose from single tort/wrongful act
iii. Holding: P precluded from bringing second claim
b. Problems w/ requiring Ps to bring all claims together:
i. Puts huge burden on P
ii. Can result in claims that wouldnt have otherwise been brought
iii. Can result in complex litigation though Rule 42(b) allows for bifurcation of claims for trial
c. Herendeen v. Champion Intl Corp. (p. 731) (1975) Issue: Did Ps earlier claim against D
preclude him P from bringing second claim?
i. P filed 2 separate claims:
(i) State court claim for fraudulent breach of employment contract to deprive P of benefits D
wins for failure to state a claim
(ii) Federal claim for entitlement to pension benefits
ii. Test:
(i) whether different judgment in 2nd action would impair/destroy rights established by the
judgment in the 1st action
1. Court says 1st suit didnt establish Ds right not to pay benefits
2. Not a big burden to D to let 2nd action go forward, b/c first case dimissed
(ii) whether the same evidence is necessary
1. reflects efficiency concern
2. Court says evidence P need to sustain 2nd claim would not have sustained 1st claim, but
unclear how much of the same evidence is necessary to pass test
(iii) whether it is the same cause of action
1. 2 independent claims of wrongdoing by D
iii. Holding: No claim preclusion for Ps 2nd claim
d. Restatement (Second) of Judgments 24 (p. 737): claim preclusion if the claims are part of the
transaction or series of connected transactions

30

i. Rule followed by most courts

ii. What constitutes a transaction depends on
(i) whether facts are related in time, space, origin, or motivation, whether they form a
convenient trial unit, and
(ii) whether their treatment as a unit conforms to the parties expectations or business
understanding/usage
iii. Normative goals:
(i) Efficiency: concerned w/ whether there's a significant efficiency gain in bringing actions
together
1. though efficiency gains in bringing claims together must be balanced against efficiency
losses in people bringing claims they wouldnt otherwise have brought
(ii) Fairness: concerned w/ parties expectations
e.
When in doubt, courts tend to resolve against preclusion
i. Definition of same transaction/occurrence most broad for supplemental jurisdiction, more narrow
for claim preclusion, most narrow for counterclaims
4. Counterclaims
a. Mitchell v. Federal Intermediate Credit Bank (p. 749) (1932) Issue: Did Ps use of defense in
prior action preclude him from bringing an affirmative action based on that defense?
i. Two suits:
(i) Bank v. Farmer to recover outstanding notes Farmer pled defense and won
(ii) Farmer v. Bank to recover for excess crops assigned to bank
ii. Test: same transaction/set of facts
(i) Facts pleaded as defense in 1st action same as those in complaint for 2nd action, claims both
arose out of the same transaction
(ii) Cant split affirmative defense and counterclaim - Cannot use the same defense first as a
shield and then as a sword
iii. Concerned w/ party having to defend same claim twice
(i) Bank may have not fought as vigorously against a defense as it would have against an
affirmative action
(ii) Though not much of a concern in this case b/c bank had notice of 2 nd action, b/c it was
pending
iv. If P had asserted no defense in 1st action, he would be able to bring 2nd
v. Holding: P is precluded from bringing affirmative action
b. May want to treat counterclaims differently than 2 claims brought by P, b/c compulsory
counterclaim forces D to bring claim in time and place of Ps choosing
i. When in doubt, interpret preclusion rules narrowly for counterclaims
c. Under current rules, clear that Mitchell P couldnt bring 2nd action
i. Rule 13(a) Compulsory Counterclaim: a responsive pleading must state as counter-claim any
claim arising out of the same transaction
d. Restatement (Second) of Judgments 22: D who fails to bring counterclaim is only precluded from
bringing affirmative action on the claim if:
i. counterclaim is compulsory, or
ii. successful prosecution of 2nd claim will nullify judgment or impair rights established in 1st case
5. Dismissal On the Merits
a. Only cases disposed of on the merits will have preclusive effect
i. Dismissal on the merits = with prejudice
(i) Rule 41(b): unless the court specifies otherwise, any dismissal other than a
dismissal for lack of jurisdiction, for improper venue, or for failure to join
a party under Rule 19, operates as an adjudication upon the merits.
(ii) Rule 12(b)(6) dismissal for failure to state a claim

31

ii. Dismissal w/o prejudice doesnt trigger claim preclusion

(i) Rule 41(a)(2): Voluntary dismissals (by the P) and cases resolved by settlement
iii. A judgment is considered final upon the trial court rendering a judgment, and pendency of an
appeal or motion for reconsideration doesnt suspend operation of claim preclusion
b. Costello v. United States (p. 755) Issue: What constitutes a form of dismissal that triggers the
application of claim preclusion?
i. Ps (U.S.) earlier denaturalization action against D (Costello) was dismissed for failure to file
affidavit of good cause
(i) Order dismissing case didnt specify whether it was dismissed w/ or w/o prejudice
ii. Under Rule 41(b), a dismissal is w/ prejudice unless it specifies otherwise
iii. Court holds that dismissal falls under Rule 41(b) exception for dismissals for lack of jurisdiction
(i) Broad interpretation of jurisdiction: anything that is a threshold matter for bringing case is
jurisdiction
(ii) Possible court thought it would be unfair to P to consider prior dismissal as w/ prejudice b/c
P had no notice
iv. Holding: The earlier dismissal for failure to file an affidavit does not prejudice P from being able
to bring a second action
c. Semtex Intl (Supp. p. 29): dismissal with prejudice under Rule 41(b) doesnt automatically have
preclusive effect, but merely bars the renewing or refiling of the claims in the same federal court
from which the case has just been dismissed
C. Claim Preclusion vs. Issue Preclusion
Claim Preclusion
Issue Preclusion
claim that is sound on the merits can be
only applies when matter has already been
forfeited even though it was never litigated
litigated
forfeiture rule
not forfeiture for something you didnt litigate,
but rule against relitigating something
strictly limited to same parties or privies
doesnt always require same parties (nonmutuality)
strict rules limiting to same transaction or
dont need same transaction/cause of action cause of action
can invoke even if issue arises in entirely
different transactional setting
D. Issue Preclusion
1. Definition:
a. previously called collateral estoppel
b. applies when issue was actually litigated and was necessary to the courts determination in the
previous suit
c. Fairness Concerns:
i. Presupposes party had full and fair opportunity to litigate the issue
(i) If not, denial of full and fair opportunity to litigate is a due process violation
ii. Shifting parties may also affect fairness
d. Legitimacy Concerns: prohibiting parties from relitigating issues reinforces the legitimacy of the
initial judgments, while allowing relitigation threatens the legitimacy of the initial judgments
2. Determining when an issue was actually litigated
a. Allegations in complaint dont preclude issue if default judgment entered no concern about
legitimacy of first judgment or efficiency
b. Answer to complaint that fails to deny certain allegations doesnt preclude issue no legitimacy or
efficiency concerns, and Ds may sometimes want to make strategic admissions
3. Determining when issue was necessary to prior judgment
a. E.g., P v. D for personal injury special verdict for D that D was not negligent and that P was
negligent

32

i. Concern that jury didnt consider each issue (Ds non-negligence and Ps negligence) alone as
sufficient to support the outcome, b/c they had the other to fall back on
b. Restatement (Second) of Judgments 27: where judgment based on determinations of 2 issues, each
of which standing alone would have supported the result, judgment is not conclusive in a later action
w/ respect to either issue
4. Traditional Applications
a. Little v. Blue Goose Motor Coach Co. (p. 764) (1931) Issue: Is Ps precluded from litigating
issue of Ds negligence, when it was decided in a previous action?
i. Two suits:
(i) Blue Goose v. Little for property damage, Little offered defense of contributory negligence
P wins on general verdict
(ii) Little v. BG for personal injury and willful & wanton negligence (under modern law, Little
would have had to bring as compulsory counterclaim to first action)
ii. Suits involved the same parties and same material facts
iii. Issue of Little negligence precluded, b/c in order for court to have ruled in BGs favor in first
action, it must have found Little negligent
iv. Issue of BGs negligence precluded, b/c in order for court to have ruled in BGs favor in first
action, it must have found that BG was not contributorily negligent
(i) P claims willful and wanton negligence in second suit, but BG could not be willfully
negligent, b/c it was found not negligent
v. Holding: Little precluded from bringing section action
b. Examples See pp. 768-769
5. Exceptions to Issue Preclusion
a. If lawsuit 1 could have been decided as it was w/o the issue being decided the way it was, but on the
basis on some other issue, no issue preclusion (see 3 above)
b. Restatement (Second) of Judgments 28 (p. 780): Even when issue is necessary to judgment in
lawsuit 1, there are exceptions to issue preclusion if
i. Party against whom preclusion is sought did not have opportunity to appeal judgment in first
action
(i) e.g., if party won in 1st action
ii. The issue is one of law and (a) 2 actions involve claims that are substantially unrelated, or (b)
new determination is warranted b/c of changes in law or to avoid inequitable administration of
the laws
(i) e.g., interpretation of law has changed in time between first and section actions
iii. A new determination on the issue is warranted b/c of difference in quality/extensiveness of
procedures followed in the 2 courts or b/c of allocation of jurisdiction between them
(i) E.g., if first court didnt allow discovery, or second court had exclusive jurisdiction over
subject matter
iv. The party against whom preclusion is sought had a significantly heavier burden of persuasion in
the initial action, the burden has shifted to his adversary, or the adversary has a significantly
heavier burden than he had in first action (criminal cases)
(i) E.g., P v. D for personal injury, P has burden of proving no contrib. negligence D wins
1. Second suit: D v. P for personal injury no issue preclusion, b/c burden of proving Ps
negligence has shifted
v. Clear and convincing need for new determination of the issue (a) b/c the determination will have
a potentially adverse impact on the public interest, (b) b/c not foreseeable at time of initial action
that issue would arise in subsequent action, or (c) b/c party against whom preclusion is sought
did not have adequate opportunity or incentive to obtain a full and fair adjudication in initial
action
(i) E.g., (a) Unnamed class members might be bound by class action judgment in future suits in
ways they didnt anticipate

33

(ii) E.g, (b) If change in the law and same underlying fact becomes relevant in new law, would
have no way to anticipate issue arising in subsequent action
(iii) E.g., (c) Very evident compromise verdict in initial suit, trivial amount of controversy,
precluded party inhibited by some disability
c. Exceptions reflect unease w/ precluding issue in different contexts
i. When in doubt, no preclusion
ii. If not precluding, doesnt mean other side wins, but just that issue gets to be relitigated
6. Modern Applications
a. Kaufman v. Eli Lilly & Co. (p. 771) (1985) Issue: Is D precluded from litigating the issues of
negligence and concerted action, when these issues were considered in a previous lawsuit w/ a
different P?
i. Two suits:
(i) Bichler v. Lilly P wins on causation, concerted action theory and negligence
(ii) Kaufman v. Lilly should Lilly be precluded from relitigating concerted action and
negligence?
1. (clear that issue of proximate cause is not preclusive)
ii. D claims issues shouldnt be precluded b/c
(i) Cases dont involve identical issues b/c time elapsed between then Bichler took drug and
when Kaufman took drug
1. court says no significant change during time period
(ii) Indication that Bichler verdict was jury compromise
1. court says insufficient evidence of this
(iii) Other cases decided differently than Bichler
1. cases inconsistent w/ Bichler involved different issues, and only case decided differently
based on same issues did not involve Lilly
iii. Issue of concerted action not actually litigated in Bichler b/c Lilly didnt contest it
iv. Holding: D precluded from relitigating negligence, but not concerted action theory
E. Issue Preclusion w/ Different Parties in First and Second Actions
1. Vicarious Representation Privity
a. General Foods Corp. v. Massachusetts Dept. of Public Health (p. 784) (1981) Issue: Does a
previous action preclude Ps from relitigating issue of the unconstitutionality of Ds food labeling
regulations, when Ps were not parties to the previous action?
i. Two suits:
(i) GMA (trade assoc.) and AFFI v. Mass Dept. of Public Health D won
(ii) General Foods and Rich-SeaPak v. Mass Dept.
ii. Due process concern b/c Ps not parties to first action
(i) Must have full and fair opportunity to litigate
(ii) Must be in privity w/ parties to previous action
iii. General Foods
(i) Member of GMA
(ii) Declined opportunity to be party to first suit
(iii) Contributed $ to fund first suit
1. this alone not sufficient to show vicarious representation
(iv) Holding: GF had vicarious opportunity to be heard in first suit. As member of GMA who
declined opportunity to be party, GF implicitly consented to be represented by GMA in that
action
iv. Rich-SeaPak
(i) Not aware of GMA litigation
(ii) Not member of GMA or AFFI
(iii) Its parent co., Rich Prods. is member of AFFI and contributed $ to GMA lawsuit, but was
not a party to that suit

34

(iv) Holding: No privity between RSP and Rich prods. to preclude RSP from litigating issue in
second suit.
1. RSP had no ability to control Rich Prods. w/ respect to first suit
v. Holding: GFs interests were sufficiently represented in the GMA action to preclude GF from
bringing 2nd suit, while RSPs were not.
b. Sources of privity:
i. Authorization to represent
ii. Actually controlling party to prior suit
iii. Derivative rights e.g., successors in interest, beneficiaries
2. Mutuality
a. Definition:
i. Traditional view was that third parties were not allowed use claim preclusive to their benefit b/c
of lack of mutuality
ii. All about symmetry
iii. E.g., First suit: P1 v. D; Second suit: P2 v. D
(i) If D won in first suit, D couldnt use judgment from first suit against P2, b/c P2 never got
her day in court
(ii) Therefore, if P1 won first suit, P2 couldnt use P1s victory against D in second suit b/c of
no mutuality
iv. Exception for derivative liability
b. Bernhard v. Bank of America Natl Trust & Savings Assoc. (p. 794) (1942) Issue: Is P
precluded from relitigating an issue against a new party when she lost on the issue in a prior suit
against a different party?
i. Two suits:
(i) Cook v. Sathers beneficiaries (including Bernhard) for accounting to establish that the
money Sather gave to Cook was a gift Cook wins
(ii) Berhard v. BofA claiming bank wrongly authorized Cook to withdraw money
ii. D argues Ds claim is barred by issue preclusion
iii. Bernhard claims issue preclusion doesnt apply b/c of mutuality doctrine
(i) But court says that due process only requires that the party against whom issue preclusion is
asserted was a party, or in privity w/ a party, to the earlier action
(ii) There is no reason for requiring that the party asserting issue preclusion must have been a
party, or in privity w/ a party, to the earlier action
(iii) Berhard in privity w/ Ds in initial action, b/c she represents same persons and interests
iv. Holding: Judgment in first action precludes Bernhard from bringing second claim, b/c she is
representing the same interests and litigating the same right as in the first action.
c. Defensive nonmutual issue preclusion: Defendant is asserting another partys victory against
plaintiff as a defense
i. E.g., Berhard
ii. Efficiency gains b/c P has already had her day in court
iii. Encourages Ps to join Ds into 1 action, though may not be more efficient b/c court can later
split actions
d. Offensive nonmutual issue preclusion: Plaintiff is asserting another plaintiffs victory as a sword
rather than a shield
i. E.g., Eli Lilly, Parklane
ii. Efficiency concern: discourages joinder b/c P2 can wait and see what happens in 1 st suit
iii. Fairness concerns: Unfair to D, b/c P1 chooses time and place of suit, and then D can be bound
by judgment in later actions
e. Parklane Hosiery Co. v. Shore (p. 801) (1979) Issue: Did prior judgment against Parklane
preclude it from relitigating its liability for issuing a false proxy statement against a new party?
i. Two actions:

35

(i)

f.

SEC v. Parklane for issuing false proxy statement SEC wins

1. Bench trial; SEC awarded injunction
(ii) Shore v. Parklane for issuing false proxy statement
ii. P claimed Parklane precluded from relitigating issue
iii. Purpose of issue preclusion is to protect litigants from burden of relitigating identical issue w/
same party and of promotion judicial economy by preventing needless litigation
iv. Fairness and efficiency concerns for offensive issue preclusion
(i) doesnt promote efficiency b/c P can wait and see what happens, so issue preclusion
shouldnt apply when P could have easily joined the prior action
(ii) D may have had little incentive to defend vigorously in prior action e.g., if amount in
controversy was low
(iii) May be unfair if judgment relied on for basis of issue preclusion is inconsistent w/ other
judgments in favor of the defendant
(iv) May be unfair to allow preclusion where 2nd action affords D procedural opportunities that
were unavailable in the 1st action that could readily cause a different result
v. None of the above concerns apply, b/c P couldnt join earlier action, D had every incentive to
defend itself against SEC, prior judgment not inconsistent w/ any others, and no procedural
opportunities lacking in 1st action that would likely cause a diff. result
vi. D claims issue preclusion would violate its 7th Amend. right to trial by jury court says nothing
in 7th Amend. says parties are permitted to relitigate factual findings that have been decided
against them
vii.Holding: Earlier judgment against D has preclusive effect.
Restatement (Second) of Judgments 29 (781, see also 5(b) above): Should be no issue preclusion
in cases involved different parties from original case if
i. Judgment in prior action indicates it should not have preclusive effect
ii. Party seeking preclusion could have joined w/ another party in the previous action
(i) Courts cautious about applying this exception
iii. Forum for second suit affords party against whom preclusion is sought procedural opportunities
not available in first forum
iv. Judgment relied on for preclusive effect is inconsistent w/ another determination on the same
issue
v. Prior determination was affected by relationship between the parties not present in subsequent
action, or was based on compromised verdict/finding

Chapter 7 Joinder of Claims and Parties

I.
Approach to Joinder
a. Ask and answer these 4 questions:
i. Why would I? A question of strategy.
ii. May I? Issues of interpreting the Federal Rules, supplemental jx.
iii. Must I? Issues of the Federal Rules, preclusion.
iv. Should I be permitted or required to? Policy issues: Efficiency, fairness, distribution,
legitimacy.
II.
Joinder of Claims
a. Why would I want to join to claims and bring them together?
i. To get into a forum, maybe they overlap (efficiency), raise the stakes and enhance your chances
of a settlement, reach the amount in controversy for federal court, etc
b. May I?
i. Federal Rule 18, Joinder of Claims and Remedies
1. No limits on joining claims together! A party asserting a claim to reliefmay join
as many claimsas the party has against the opposing party.

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III.

2. What if I am in federal court and one of my claims has a federal question and one
doesnt?
a. Can only bring them together if there can be supplemental jx by having a
common nucleus of operative fact or being part of the same case and
controversy according to 1367.
Joinder of Counterclaims
a. Why would I, as a D, bring a counterclaim?
i. Make yourself look more sympathetic, might be more efficient, you are already hiring a
lawyer/in court anyway, put pressure on P with respect to settlement, to get supplemental jx so
you can have access to federal court.
b. Why would I not bring a counterclaim (and instead bring s separate claim)?
i. You may want to choose your own forum.
ii. Hearing Ps claim may be prejudicial to your counterclaim.
c. May I bring a counterclaim?
i. Rule 13 Counterclaim and Cross-Claim
1. Rule 13 (b), Permissive counterclaims: it is permissive to bring any counterclaim that is
not transactionally related to the subject matter of the opposing partys claim. Allowed
to bring any counterclaim you have against the opposing party.
2. Again, if in federal court must get supplemental jurisdiction over the counterclaim, can
only get this if contains underlying nucleus of operative fact. It is still possible to have
supplemental jx even if not a compulsory counterclaim because the test for
supplemental jurisdiction is broader than the definition for compulsory counterclaim.
This is because forfeiture is the harsh penalty for compulsory counterclaims, so courts
are hesitant to apply this broadly, whereas supplemental jx doesnt have this penalty. If
you cant get supp jx, its still possible to take have the claim heard in state court.
a. Wont apply the transactionally related test the same for both supp jx and
compulsory counterclaim.
d. Must I bring a counterclaim?
i. Rule 13 Counterclaim and Cross-Claim
1. Rule 13 (a), Compulsory counterclaims: a counterclaim is compulsory if it arises out of
the same transaction or occurrence as the claim that has been brought against you AND
it does not require the presence of 3rd parties of whom the court cannot acquire
jurisdiction.
2. If your counterclaim is compulsory, then you dont need to worry about not having
supplemental jx if in federal court because your claim must already be arising out of
the same transactiontherefore, will pass the test of containing nucleus of operative
fact for supplemental jx as well.
ii. Grumman Systems Support Corp v. Data General Corp (1988) pg. 848
1. Claim 1: DG v. Grumman for federal copyright infringement in MA federal court.
2. Claim 2: Grumman v. DG for anti-trust violation claim in CA state court, gets removed
to CA federal court.
a. DG asks for a motion to dismiss on claim 2 because says anti-trust claim a
compulsory counterclaim to his first claim for federal copyright infringement
b. Grumman adds two other Ps and two other Ds, trying to create a center of
gravity in CA so that the case will not be transferred to MA. Grumman also
brings other claims that are not related to the original claim regarding the
ADEX computer program.
3. Test for whether Grummans claim is a compulsory counterclaim to DGs original
claim is: are they part of the same transaction or occurrence? Is there a logical
relationship bn these two claims?

37

IV.

4. Court holds: yes, there is a logical relationship bn the 2 claims, DG says you are
wrongly using our program, Grumman says you are trying to monopolize this program
and you have no power to do so.
5. Seems that these cases have a common origin of events out in the world that gives rise
to these claimsso why dont they just make the test common origin?
a. Logical relationship is broader. Still, not very helpful.
b. Sometimes courts look at Restatement factors.
6. What happens if some claims are logically related but some arent? This court doesnt
mind as long as there is a logical relationship bn the core facts.
Joinder of Parties
a. Joinder of Ds
i. Why would I?
1. Want more parties who can share the costs of a judgment.
2. Join a less sympathetic D.
3. So you can use discovery devices against this person.
b. Joinder of Ps
i. Why would I?
1. More cloudt against a D.
2. Share the costs of litigation.
3. May incease your likelihood of settlement, show the stakes are high.
4. Join sympathetic parties.
5. To defeat diversity.
ii. Why wouldnt I?
1. You will lose control of the litigation.
2. The added confusion can work to your disadvantage.
3. Unsympathetic co-P will have adverse affects on your claim.
c. May I?
i. Joinder of claims by separate parties is not as generous as joinder of claims by one party.
1. A party can bring as many claims against a D as he wants and no connection is
necessary. Rule 20 (a), Permissive Joinder of Parties states that if joined parties, Ps
need claims to 1)arise out of the same transaxtion AND 2) have some common q of
law/fact to all parties.
a. Need some sort of efficiency gain to justify bringing suits together.
b. Complexity can become so high when joining parties that each partys ability
to defend/press their own claims could be hindered.
ii. Guedry v. Marino (1995) pg. 863
1. 6/7 Ps had free speech claims.
2. 4/7 had race discrimination claims
3. 1/7 had a retaliation for workers comp claim + a race/sex discrim claim.
4. D said these claims/parties were misjoined, filed a 42(b) motion to sever the claims.
5. Court holds that joining of Ps here is proper. Court says not concerned about workers
comp P, as long as there can be some overlap with people who are properly joined then
it is okay.
a. If P was not allowed to be joined, she could use other partys claim to
collaterally estop on a claim she brings later if they win. If they lose, she can
relitigate the issue because she never had her day in court. So, more of an
efficiency claim if the D loses.
6. Couldnt the chain just go on forever, every person has one claim properly claimed
with a party, and another claim, etc? Here, the common theme of an overall claim
against sheriff of firing decisions is what is causing the judge to want to bring all the

38

claims together. If didnt have some idea linking all the claims, crt probably wouldnt
allow them all to be brought together.
iii. What if the P to be joined doesnt satisfy the amount in controversy requirement for a diversity
claim?
1. 1367 (a) satisfied because same controversy and (b) satisfied because does not violate
any of the exceptions.
d. Must I?
i. Rule 19 Joinder of Persons needed for Just Adjudication (Compulsory Joinder of Parties).
1. There is an underlying concern about fairness to those who are already in the lawsuit
and fairness to the one who is not included (the absentee). P may not be allowed to
proceed because he cant get jx over the absentee, or because of some other reason why
the absentee cant be sued (sovereign immunity). P may either be deprived of his
choice of forum or may not be able to go forward with the lawsuit at all.
2. Unless the absentee is in privity with a party, they will not be bound because they have
never had their day in court. So why worry about the non-privity absentee?
a. Even if absentee not bound through issue preclusion, he may still be harmed as
a practical matter.
3. Must be concerned about these obstacles to (compulsory) joinder.
a. Personal jx:
i. Partial remedy! Rule 4k1b, if cant litigate bc no p jx, can go 100
miles past the court house to drawn in an absentee party if they are
being joined under 14/19. In these situations, the gains of having the
case go forward with everyone is strong, whereas the efficiency loss of
having to travel 100 extra miles is not very big.
ii. Nationwide process for interpleader actions.
iii. Personal jx important bc if you cant get p jx, no suit can be brought!
b. Subject Matter jx
i. What if absent party destroys complete diversity?
1. Too bad! Cannot have supplemental jx over parties joined by
P under Rules 14, 19, 20, 24less leeway than p jx because if
you cant get sm jx, can always sue in state court, whereas if
there is no p jx, cannot sue at all.
c. Can also structure recovery as a way to mitigate these fairness concerns:
i. Pg. 876 example, if absentees ruin complete diversity, can allow P to
go forward without joining absentees. Make P a trustee of P1 and P2
(put them in privity). If they win, trustee relationship. If P loses, then
other Ps wont be precluded from bringing suit.
ii. How does Rule 19 handle these situations? By creating 2 categories:
1. Persons to be joined if feasible
2. Parties who cant be joined
a. Rule 19(a) if you can get jx, then you MUST join the absentees. On/off
switch.
b. Rule 19(b) if the person cannot be made a party, then must determine
whether the case should be allowed to proceed without that person or whether
it should be dismissed. Factors to consider:
i. To what extent a judgment rendered in the persons absence will
prejudice them
ii. Whether the prejudice can be lessened/avoided
iii. Whether a judgment without them will be adequate
iv. Whether P will have an adequate remedy if the case is dismissed
1. Asking for a HOW much determination, a pragmatic inquiry!

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V.

VI.

iii. Broussard v. Columbia Gulf Transmission Co. (1968) pg. 877

1. P owners of a piece of property want an injunction against D gas company for removal
of a pipeline on property. Also want damages.
2. One of the co-owners of the property ruins complete diversity. Ps want to drop the coowner, but the court wont allow this bc concerned about the judgment not being final
without P and the danger of multiplicity of suits.
3. Goldberg not convinced this party has to be joined at all, says this court doesnt really
do a Rule 19(a) analysis at all, and need to do (a) before going to (b). If a party does
not satisfy 19(a) then joinder is not compulsory.
4. Court seems to be influenced by the fact that this is a dispute over land, and that this
case could be sued in state court, state courts have a stronger interest in this claim.
Also, no less convenient for the case to be held in state court.
5. Court holds that this claim should be dismissed because P must be joined as a party.
Impleader Joinder of 3rd parties under Rule 14
a. Impleader makes it possible for a D to argue that if Im responsible to P then YOU are responsible to
me.
i. Different from a cross claim, which is bringing a claim against someone that has already been
brought into the lawsuit. Implead a party that has not been joined into the lawsuit originally.
b. Why would I?
i. Can be spared having to bring another lawsuit, litigate all the issues again.
ii. Could lose to P and then lose to the person you want to implead. Want to avoid inconsistent
outcomes.
iii. PR advantages of pointing the finger at someone else from the very start
iv. 3rd party may have a great litigation team, they will do your fighting against P for you!
c. May I?
i. Rule 14 is a very favorable joinder device.
ii. Can only bring if there is a derivative liability argument. Cant say it wasnt me, it was him.
This can be a defense to your liability. However, if bringing someone in under Rule 14 you are
saying if I am liable to P, then this person is liable to ME.
iii. What about P and SM jx?
1. For personal jx there is the 100 mile bulge rule.
2. For SM jxwhat if the impleader destroys complete diversity?
a. Thats okay, because there is no exception for claims by persons made D under
Rule 14 by Ds in 1367.
d. Must I?
i. No.
Intervention Rule 24
a. This occurs when a person wants to join into a lawsuit either as P or D and has not been named in the
lawsuit originally.
b. Why would I?
i. As a community group may want to get involved in an issue, perhaps you dont think P is doing
the best job litigating.
1. Can always file a brief as a friend of the court, but this doesnt give you rights to
appeal, rights to discovery, and any other rights that you get by being a party!
ii. You might be harmed as a practical matter, are worried about an adverse legal precedent being
set.
c. May I? When do you get to crash someone elses lawsuit?
i. We are concerned about X if X is going to be potentially adversely affected by this lawsuit, but
we are also concerned about P. If Xs interests will be adequately represented by P, then X will
not be allowed to intervene.
ii. 24 (a) Intervention as of right:

40

VII.

1. Anyone can intervene if a statute confers the right to intervene or if the applicant
claims an interest relating to the action and is situated such that his ability to protect
that interest will be impeded.
2. Cannot intervene if interests will be adequately represented by P.
iii. 24 (b) Permissive Intervention:
1. According to the courts discretion, anyone may be admitted to intervene in an action
if conferred by federal statute OR if an applicants claim or defense has a common q of
law or fact with the main action.
iv. If you are going to ruin complete diversity, then as an intervenor you cannot take advantage of
supp jx through 1367. You are butting into someone elses lawsuit, cant ruin Ps choice of
forum!
d. Must I?
i. No. However, you can be denied certain benefits if you do not intervene.
1. Ex: non mutual issue preclusion
a. P1 v. D
b. P2, P3, P4etc v D.
c. All Ps after P1 hoping P1 wins and then they can use issue preclusion to win
their subsequent suits. However, one of the Restatement exceptions on pg 781
asys courts must consider whether Ps could have intervened into a lawsuit and
if yes may not allow them to use non mutual issue offensive preclusion.
2. Also, a case could be allowed to go forward under Rule 19 without you! Harsh
outcome. Here, X has to give up having choice of forum and waive personal jx in order
to get in on the suit at all. If the suit goes on without him, could be bad for him.
e. Should I be permitted to intervene?
i. It depends on the case.
1. If there is a large public interest, could be a good idea to strengthen a claim. However,
sometimes, it will really much up some Ps lawsuit.
ii. Unless you are a Rule 19(a) type party, courts monitor this pretty carefully. Take into
consideration Ps interest in controlling his own lawsuit, as well as partys interest in not be
included.
Class Actions
a. Distinguishing factor of class actions:
i. When a class action is brought its judgment has binding effect on individuals who are not
actually parties before the court, and who are not even in privity with those who are before the
court. Principle that you cant be bound if you have not had your day in court is thrown out the
window! Huge DP issue. Because of this, we are concerned about which cases that go forward
as class actions, and fairness to those that are not named members.
b. Policy considerations
i. Efficiency gains:
1. Where it is quite likely that all the members of the class would otherwise bring their
own separate lawsuits with overlapping legal and factual issues. Now we get to
consolidate them and litigate them all at once for everybody.
a. Some of this efficiency could be gained through non-mutual offensive issue
preclusion.
2. Some cases costing many people a thousand dollars, but bringing suit far exceeds a
thousand dollars. We can make it possible for all these people to band together and
pool their losses and bring a lawsuit to achieve an in the world efficiency. (lower
pollution)
ii. Efficiency losses:
1. Having to administer mechanisms for distributing recovery very complex!

41

a. Triggers fancy recovery schemes! People not used to courts doing this
triggers legitimacy issues! Courts becoming legislative bodies/administrative
agencies!
2. Costs of insuring fairness to all involved/bound
c. Why would I?
i. Yes - Could make your suit stronger, if want injunctive relief can prove there is a systemic
problem and make the court more inclined to grant systemic relief, may make the case seem
more sympathetic
ii. No Perhaps a personal claim, have enough of a claim to bring it on your own
iii. Maybe think about where your case is on the spectrum of variation in terms of harm suffered.
iv. Examples to think about:
1. Been injured through use of a contraceptive device, can no longer become pregnant.
2. Inmate at San Quentin, poor healthcare (no sanitation! Use same gloves! EW!!!).
3. One of 1500 co-owners of a piece of property that is being harmed by some sewage
being spilled on adjacent property. Some of these 1500 workers work in the company
that is producing spillage (maybe 10). Youre one who doesnt.
d. May I?
i. SM jx concerns: What if some members of the class are not diverse?
1. Diveristy - pg. 378 Supreme Tribe of Ben-Hur v. Cauble, citizenship of a class
representative is all that counts for purposes of diversity in a class action suit, there will
be supplemental jx over all the unnamed class members.
2. Amount in controversy may not aggregate to meet the amt in controversy unless have
a joint interest. But what if there is one person who has the amount in controversy?
a. Doesnt seem to violate 1367, but 1367 creaters said they were not
overruling Zahn, an issue before the Supreme Court right now.
ii. Personal jx concerns: Shutts.
iii. Due process concerns:
1. Hansbury v. Lee (1940) pg. 899
a. Case 1: Burke v. Kleiman.
i. Case where Burke wants to enforce racially restrictive covenant, keep
Kleiman from selling not within covenant.
b. Case 2: Hansbury v. Lee
i. Now Burkes husband wants to sell to black person, Hansbury.
ii. Lee trying to prevent Burke from selling to Hansbury, Burke wants to
bring open the q again of whether 95% of people have signed onto this
covenant.
iii. Lee says there should be issue preclusion bc Burke was part of the
earlier class of people seeking to enforce the covenant, class actions
binding on all class members, therefore Burke should not be permitted
to reopen this question.
iv. Should this earlier class action be binding on unnamed class members?
v. Court holds, no! Violates DP for it to be binding (no notice, etc). Out
of this caseRule 23 is born!
iv. Rule 23 has provisions for notice, for typicality, there are abilities to opt out, etc.
v. Rule 23 has requirements in section (a) that must apply to all actions:
1. Must be so large joinder of all parties impracticable
2. Qs of law/fact must be common to all
3. Claims/defenses of rep must be typical of the class
4. the rep parties must fairly and adequately represent the interests of the class
vi. Then the rule differentiates into 3 kinds of class actions:
1. 23(b)1 - class actions that are substitutes for compulsory joinder

42

2. 23(b)2 class actions where all you want is injunctive relief

3. 23(b)3 class actions where there are overlapping issues of fact/law and it is not
definite whether there will be efficiency gains from bringing a class action or not.
e. Must I?
i. No, unless all class members are subject to compulsory joinder!

43