I have a few questions concerning the material taught today. As I
can't attend the review sessions - I thought id put them in an email.
Perhaps I can come to your office at some other time.
You mentioned in class that Shaffer, created a fourth theory of
jurisdiction, but throughout the Shaffer case the majority judgment
appears to be applying the minimum contacts standard of International
Shoe, and therefore they find that the necessary contacts were not
substantial enough to create jurisdiction. Therefore isn't the idea
that this fourth category of jurisdiction, i.e. that D could reasonably
have anticipated jurisdiction based on his activities, merely support
for the application of International Shoe (i.e. further evidence of
connection or not) or alternatively obiter dictum rather that a new
theory of PJ on its own?
A.
I agree that there is nothing in Shaffer itself that requires the
fourth theory. Their refusal to grant PJ can be understood in terms of
the
standard Int'l Shoe approach. The problem is future cases. First of all
quasi in rem is still allowed in connection with bank accounts and real
property and it is hard to see how the contacts in such cases are
substantial and continuous enough to allow PJ for unrelated causes of
action. Second, there is the problem of tagging, where the contact
often is clearly not substantial and continuous. In both these cases
this
fourth theory starts playing a role. We will see this in Burnham.
Furthermore, even if he did not travel to Maine, there still might
be PJ over Dave in Maine, since he created a defect in the cage that he
knew was going to travel with the circus to Maine. There is at least an
argument for PJ here.
But let's assume there is no PJ over Dave in Maine. That means
that there is no place where Kelly and Dave can be sued together
(unless Bob can tag Dave on a trip to Maine or find some property of
Dave's in Maine etc.). That means that there has to be separate
lawsuits - one against Dave and one against Kelly. That happens
sometimes.
Q. 9. Question about sua sponte
dismissal on venue grounds.
A number of you have mentioned an inconsistency between what I said in
class a bit back about sua sponte dismissals on venue grounds and what
Glannon says on p. 144 (Q. 5).
A
What Glannon primarily says there is that he thinks sua sponte
dismissals on venue grounds
should be
OK, because the purpose of the venue statute is not merely to prevent
inconvenience to defendants but also to allocate judicial resources to
a federal court with some connection to the case. I agree that the
venue statute has this purpose. Glannon fails to note, however, the
waivability of venue, as
spelled out in FRCP 12(h), which suggests that sua sponte dismissals
are not
OK.
The real question is how many cases are on Glannon's side. He cites a
Supreme Court case (Gulf Oil v. Gilbert), but that case is one in which
the court dismissed on
forum non
conveniens not venue grounds, and in which the defendant
requested dismissal. The dismissal
was not sua sponte. Glannon merely cites it for the airy proposition
that certain private and public interests might make a court an
inappropriate place for litigation.
The truth is that Glannon has some cases, and so do I, but that more
are on my side. Glannon notes that several cases have said that
dismissals sua sponte are not OK. In this connection he cites Wright
& Miller, which also largely backs up my view: "Since an
objection to venue is a personal privilege of the defendant,
the burden is on the defendant to object in a proper and timely fashion
if he thinks venue is improper. The failure to raise the objection
properly is a waiver of the defense. Because of the waiver principle
and the personal nature of the defense, it generally (but not always)
is thought inappropriate for the district court to dismiss an action on
its own motion for improper venue if there has been no objection from
the party for whose benefit the privilege exists. However, some courts
occasionally say that the objection may be raised
sua sponte
under extraordinary circumstances." 15 Wright & Miller 3826.
As Wright & Miller note, some courts of appeals have hedged their
bets. Although striking down the trial court's sua sponte dismissal,
they have suggested that a sua sponte dismissals on venue grounds might
be OK in "exceptional circumstances." Concession Consultants v.
Mirisch, 355 F.2d 369 (2d Cir. 1966). They did not say exactly what
these extraordinary circumstances might be.
But I was able to find a case in which those exceptional circumstances
were held to exist. In Stich v. Rehnquist, 982 F.2d 88 (2d Cir. 1992),
the plaintiff filed suit against all nine justices of the United States
Supreme Court and others alleging a conspiracy dating back to 1963 to
prevent enforcement of air safety laws and alleging that the defendants
exploited the plaintiff's marital difficulties in order to deprive him
of his property. Without waiting for any of the defendants to assert
the defense of improper venue, the trial court simply dismissed sua
sponte on venue grounds and this dismissal was upheld on appeal.
Christopher v. U.S., 2001 WL 1256915 (N.D. Cal. 2001) is a similar case
of a crazy plaintiff (in this case suing the US, the Sect'y of the Navy
etc.) in which sua sponte dismissal on venue grounds occurred
(basically as a way of getting rid of the case without bothering the
VIP defendants)..
But Wright & Miller do cite a few cases that go Glannon's way even
though they do not involve crazy plaintiffs suing VIP defendants.
Nevertheless, the majority of the cases discussed there reject the sua
sponte dismissal.
Finally, it is OK, for the court sua sponte to transfer the
case to a better district. This is clear from 28 USC 1404(a).
Q. 10 Questions about Allapattah
scenarios
After the discussion of Allapattah in class I had some hypotheticals
about Kennedy's "infection" (I wouldn't be surprised if these come
up
eventually in class).
These would all be state law claims (SMJ through diversity under
§1332 and the P2 action would be the same constitutional
"case or
controversy"):
P1 (NY) sues D (NJ) for $100k. P2 (NJ) joins and sues D for $25k.
(Joined suit is not diverse and below the jurisdictional minimum).
A. No suppl jur.
P1 (NY) sues D (NJ) for $100k. P2 (NJ) joins and sues D for
$100k.
(Joined suit is not diverse but above the jurisdictional minimum).
A. No suppl. jur.
P1 (NY) sues D (NJ) for $100k. P2 (NY) joins and sues D for
$25k.
(Joined suit is diverse but below the jurisdictional minimum).
A. Suppl. jur. But notice if it was
P(NY) sued D1(NJ) for $100K and D2(NJ) for $25K there would be no suppl
jur for P's suit against D2!
P1 (NY) sues D (NJ) for $100k. P2 (NY) joins and sues D for
$100k.
(Joined suit is diverse and above the jurisdictional minimum -
has
it's own source of SMJ?)
A. Yes - its own source of SMJ
Q. 11 Question about quasi in rem and general PJ
1. We discussed in relation to Pennoyer that when
litigating quasi-in-rem actions, you could only litigate up to the
value of the property. Anything beyond that would have to be
brought in a different suit. Is this still applicable?
A. There are a couple of questions
here. First of all, let us assume that the case is one that would
satisfy the concerns expressed in Shaffer. The property would have to
be something like real property or a bank account (not stock considered
by law to be located in the forum state).
Now one question to ask is whether
*under state law* in such cases PJ is asserted only up the value of the
property. The answer is yes. This is still common.
The more tricky question is whether as
a constitutional matter PJ *must* be limited to the value of the
property. That's hard to say. The SCt has never said anything more
this. I could imagine arguments on either side. Someone might say that
the only reason that PJ is OK in quasi in rem cases post-Shaffer is
that the property is a substantial and continuous contact with the
forum state allowing for the D to be sued on any cause of action. This
argument appeals to the standard for general jurisdiction spelled out
in Int'l Shoe. But if that is true then why should PJ be, as a
constitutional matter, limited to the value of the property?
On the other hand, one might say that
the real reason that there is quasi in rem PJ through real property or
bank accounts is that one can reasonably anticipate PJ (and one
couldn't in Shaffer). But if that's true one might say that one can
reasonably anticipate PJ only up to the value of the property. that
would limit PJ up to the value of the property as a constitutional
matter.
2. Can you get general
personal jurisdiction over a person? In Perkins the court said
that there was general personal jurisdiction for the time that the
company was located in Ohio. Therefore any causes of action that
occurred during that time period could be brought in Ohio. If a
person was domiciled in a TN for 10 years and then moved, could you sue
them in TN for causes of action that occurred during those 10
years? (assuming the statute of limitations was still in play)
A. This too is a complex question.
First of all, the Perkins court did not say that there was general PJ
over the company for actions arising during the time it was located in
Ohio. The cause of action at issue arose before the war, that is,
before there were any Ohio activities at all. But that's not a problem.
There is general PJ over a corp if the corp has subst continuous
contacts with the state. If there is general PJ, you can sue that corp
on any cause of action, whenever it arose. It does not have to arise
during the time there were subst continuous contacts.
Let's move on to the question of
general PJ over an individual. First of all, there can be general PJ
over an individual through tagging. If tagged you can be sued on any
cause of action at all. What about domicile? Well if the state is your
current domicile, there is also general PJ. You can be sued on any
cause of action at all.
Now what if you were domiciled
from 1995-2005 and now have left. Can you be sued for causes of action
arising during that period? Let us first set aside cases of specific
jurisdiction. You can clearly be sued in that state for activities *in
that state* that occurred during the ten year period. But can you be
sued concerning causes of action that arose during the ten year period
but did not arise in that state? In other words, is there general PJ
over you? The answer is...NO - although you are very perceptive to have
worries here, since PJ would appear from the language of Int'l Shoe.
The same point applies to corps. If a
corp has substantial continuous current contacts with the forum state,
there is general PJ and it can be sued on any cause of action. But if
all the subst continuous contacts are in the past, there is no general
PJ, not even for causes of action that arose during the period that
there was subst continuous contacts. The only source of PJ is specific,
by arguing that the cause of action is related to one of those past
in-state contacts.
Q. 12 Question about Twombly.
I was looking through my notes and wanted to make sure I had
the
distinction between Sierocinski and Twombly correct.
Sierocinski made conclusory allegations that added up to a
claim.
Essentially, he said that DuPont was negligent in manufacturing
and
distributing a blasting cap that would explode when used under
normal
circumstances. In Bell v. Twombly, the plaintiff made a
conclusory
allegation that did not state a claim because they alleged
that
parallel conduct on its own constituted a violation of the
Sherman
Antitrust Act. As I understand it, the distinction is that
if
Sierocinski's allegations were correct, DuPont was certainly
negligent. Bell's allegations, however, could be true and
still not
be a violation of the Sherman Act b/c parallel conduct could
occur
without the two parties agreeing or conspiring to do it. Is
that
correct? If so, it seems that the plaintiffs could have made
a very
broad allegation about when or how the baby bells agreed to
their
alleged non-competition (subject to Rule 11, of course) to cure
their
complaint. Why didn't the plaintiff's attorneys amend
their
complaint in that way?
A. I pretty much agree with
everything you say about Twombly. But you miss out on the following
statement from footnote 10 of Souter's opinion: "FN10. If the complaint
had not explained that the claim of agreement rested on the parallel
conduct described, we doubt that the complaint's references to an
agreement among the ILECs would have given the notice required by Rule
8."
So it looks like if there had been a
bare allegation of an agreement
(and the parallel conduct was just thrown in as some evidence of the
agreement), there would have been a failure to satisfy 8(a). That's why
the plaintiffs didn't bother to amend. And that's why I said that
Twombly is really about 8(a), not failure to state a claim. It looks
like the pleading requirements under 8(a) have been increased, at least
for antitrust actions.
Q. 13 Question about relation back and
compulsory counterclaims
I have a question about relation back for compulsory
counterclaims.
I have in my notes that relation back only applies to
amendments.
Does this mean that if P files a complaint against D for damages
in a
brawl on the last day permitted by the statute of limitations,
D
cannot bring his compulsory counterclaim for his own damages in
his
answer? I see the arguments on both sides of this, but I
wanted to
make sure I had this correct. Even compulsory counterclaims
are not
saved by relation back--only amendments to pleadings or motions.
A. The language in 15(c) applies only
to amendments. So it looks like
one cannot, technically, use that provision to save the compulsory
counterclaim. But courts have considered them saved anyway if they
satisfy the standards in 15(c). Or rather they consider them saved,
provided that the compulsory counterclaim would have been within the
statute of limitations had it been brought at the time of the original
complaint. (There is an argument that the compulsory counterclaim would
be saved even if the statute of limitations for the counterclaim was
shorter than the statute of limitations for the plaintiff's original
claim, such that the counterclaim would have been outside the statute
of limitations if it had been brought at the time of the plaintiff's
original complaint. We discussed this is class. But I cannot find a
case accepting this.) OK?
Q. 14 Question about waiver and
counterclaims.
Dear Prof. Green,
In looking over the questions about counterclaims, I came across
something that I have no notes on. You asked the following question:
Assume that P sues D for battery in fed ct. D answers, asserting
defense of insuff. service and joins a counterclaim for his own damages
in the brawl. P argues that D has waived defense of insuff service by
counterclaiming. Result? Is this questions answered by FRCP 12(b): "No
defense or objection is waived by joining it with one or more other
defenses or objections in a responsive pleading or in a motion"?
I know that courts have found that the assertion of even a permissive
counterclaim will not defeat a defense like venue or PJ in the same
responsive pleading, but I guess I am wondering about the last part of
the question, on whether it is answered by R. 12b.
My feeling is that this can be used as analogy, but the better
explanation is the "use it or lose it theory," where if you don't use a
compulsory counterclaim, you will lose it later, and should not be
punished for using it now.
Is this line of reasoning in explanation correct?
A. First of all, 12b does not answer
the question because it says there is no waiver by adding another
defense or objection. A counterclaim is not a defense or an objection.
But courts have tended to find no
waiver here anyway. The reason I gave is not the use it or lose it
theory. After all, D could put in his defense of service alone, wait
for the defense to be determined, and if it was decided against him,
amend his answer to add the compulsory counterclaim. The counterclaim
would not be lost. The argument I gave is that there is no good reason
to force D to go through such a process. Why not allow him to put the
defense and the counterclaim in the answer from the beginning?
But there may be something to
your use it or lose it theory, since if D doesn't put the counterclaim
in the answer and P's action is dismissed on service grounds, D stands
a chance of being precluded if he tries to sue on the counterclaim
later. He would be more protected if he put the counterclaim in his
answer from the beginning and then when the P's action is dismissed on
service grounds, he asked that the court allow him to voluntarily
dismiss the counterclaim without prejudice.
Q. 15 Questions about impeachment
evidence.
Some quick questions while cleaning up on scope of discovery:
In general the policy is that the surprise of catching a lying
witness
with impeachment evidence in front of the jury is a good thing,
but
indications are still that the evidence is discoverable with
some
qualifications (that mitigate the impact of its discoverability on
the
lie-catching?).
CORRECT
Is evidence that you have impeaching your own witness discoverable
by
the other side (if it is not work-product)?
YES - CLEARLY. IT MAY ALSO BE
DISCOVERABLE EVEN IF IT IS WORK PRODUCT, SINCE THE USEFULNESS FOR
IMPEACHMENT MIGHT BE USED TO OVERCOME THE QUALIFIED WORK PRODUCT
PRIVILEGE.
What qualities of the
evidence are looked toward in finding out if it is discoverable,
or is
it discoverable in general for its relevance alone?
ITS USEFULNESS FOR IMPEACHMENT MAKES IT
RELEVANT, BUT OF COURSE IT MUST REALLY IMPEACH THE WITNESS (THAT IS,
SUGGEST THAT HE IS A LIAR) NOT SIMPLY MAKE THE WITNESS LOOK LIKE A BAD
PERSON. THERE ARE MANY FIGHTS ABOUT WHETHER MATERIAL IS GENUINELY
IMPEACHING RATHER THAN SIMPLY PREJUDICIAL.
Is evidence that you have impeaching the opposing side's
witness
discoverable by the opposing side? What has to be shown about
the
evidence to make it discoverable, or is it discoverable in general
on
relevance alone?
THERE HAS BEEN A MOVEMENT TO MAKE IT
DISCOVERABLE, BUT WITH A POSSIBILITY OF DEPOSING THE OTHER SIDE'S
WITNESS BEFORE TURNING IT OVER. IF THE MATERIAL IS WORK PRODUCT,
HOWEVER, THE PRIVILEGE WILL HAVE TO BE OVERCOME, IF IT CAN BE.
Does the policy of allowing depositions of witnesses before
the
evidence is turned over the compromise to allowing this discovery,
in
that it allows the impeachment evidence to be scrutinized yet
allows
the party to expose them in their lie?
RIGHT.
Sorry that these turned more into statements then questions. A
mere
confirmation that I'm on the right track might suffice. Thanks!
Q. 16 Questions about relation back
and new parties.
I have a question about relation back and the addition of new
parties. It seems that the only provision that speaks to this is
15(c) about the changing or renaming of parties. So from what
this says, is it true that the naming of additional parties does not
relate back? For instance in the case of a co-defendant: Say you
had a contract issue and there were two defendants that signed it and
you only sued one. Then the statute of limitations runs
out. If you amend to add the second signer, the case against the
co-defendant would be dismissed for statute of limitation because the
issue did not relate back?
Also, does that work the other way for plaintiffs? Say the
defendant beat up two people at a bar. You did not know who the
other plaintiff was so you filed alone. The statute of
limitations on battery runs out. Then the other person who was
beat up suddenly approaches you and wants to join as
co-plaintiff. This claim would be dismissed for statute of
limitations concerns because they do not relate back?
A. You are right that relation back
for change of parties is governed by 15(c) (or, more
specifically, 15(c)(1)(C)). You are also right that the adding of
additional defendants would not allow for relation back. The only
situation in which the defendants are changed and relation back is
allowed is when the name of
an original defendant in the complaint is corrected (and the
other requirements of 15(c)(1)(C) are met, of course). Adding an
entirely new defendant won't work. And it shouldn't work, since that new defendant would not
have notice within the statute of limitations period.
Now the question about adding a new
plaintiff is a very nice one indeed. Here is what Wright & Miller,
6A Federal Practice and Procedure section 1501 have to say on the
matter:
Although Rule 15(c)
does not expressly apply to a new pleading adding or dropping
plaintiffs, the Advisory Committee Note to the 1966 amendment of the
rule indicates that the problem of relation back
generally is easier to resolve in this context than when it is
presented by a change in defendants and that the approach adopted in
Rule 15(c) toward amendments affecting defendants extends by analogy to
amendments changing plaintiffs. As long as defendant is fully apprised
of a claim arising from specified conduct and has prepared to defend
the action, his ability to protect himself will not be prejudicially
affected if a new plaintiff is added, and he
should not be permitted to invoke a limitations defense. This seems
particularly sound inasmuch as the courts will require the scope of the
amended pleading to stay within the ambit of the conduct, transaction,
or occurrence set forth in the original pleading.
Q. 17 Question about counterclaims and removal
If defendant's compulsory counterclaims against plaintiff
exceed the jurisdictional minimum for diversity suits, can D use this
as basis for removal? I realize that D cannot aggregate his
counterclaim with P's claim to rise above the jurisdictional minimum,
but is D unable to bring his causes of action against P in federal
court simply because P was able to file his claim first?
A. Most (although not all) federal
courts have held that the defendant's counterclaims, including
compulsory counterclaims, are irrelevant in determining removability.
The question is answered solely by reference to the plaintiff's
complaint. This is true even when the compulsory counterclaim on its
own is above the jurisdictional minimum. See e.g. Shaw v. Dow Brands, 994 F.2d 364, 366 (7th Cir.1993); Martin Pet Prod. v. Lawrence, 814 F.Supp. 56, 58 (D.Kan.1993) Video Connection of Am. v. Priority
Concepts, Inc., 625 F.Supp. 1549,
1551 (S.D.N.Y.1986). But see,
Fenton v. Freedman, 748 F.2d 1358
(9th Cir.1984).
Q. 18 Question about the jurisdictional minimum in diversity and
injunctions
I have in my notes
that if a diversity case claim involves only
injunctive relief, that removal to federal court can be based
on
potential losses of the defendant were he to have to shut
down his
taxidermy business as a result of the injunction. Is this true?
If
so, I have a second question about this question presented in
class:
7) P1 and P2 are suing D. (P1 and P2 each have property
adjoining
D's.) P1 and P2 ask the court to enjoin D from polluting
their
property by shutting down his rendering plant. Assume that the
cost
to D in lost revenue if he shuts down the plant is $140,000.
The
value of the injunction to P1 and P2 is $70,000 each. Is the
amount
in controversy satisfied for diversity?
I understand how this could fall under the Shields v. Thomas
exception, but couldn't this also be removed by the defendant
because
his losses, if the injunction is given, would be above 75K?
A. There are a couple things going on
here. First of all, there is some
disagreement in the federal courts about how to measure the value of
injunctions for jurisdictional minimum purposes when the value to the
plaintiff is different from the cost to the defendant. Some courts say
value to the P, some say either can be used, other say the
cost to the D applies when the D is removing and the value to the P
applies when the P is suing originally in federal court. For citations,
see Olden v. Lafarge Corp., 383 F.3d 495, 503 n. 1 (6th Cir.2004).
But there is another element to your
question. In question 7, one might
say that there is a common and undivided right asserted by P1 and P2
because injunctive relief must be given to both of them if it is given
to one of them. For this reason, under Shields, aggregation is
possible. I think your question is whether we might get the same
result, without appealing to the common and undivided right principle
of Shields, if one simply looked to the defendant perspective in
valuing injunctions.
I think the answer is no. But to see
this we need a case in which
Shields does not apply. Imagine P1 and P2 are suing D because of
flooding from D's property. Each is asking for injunctive relief, but
P1 is asking that D dam one part of a stream and P2 is asking that D
dam another. Injunctive relief flowing to P1 is possible without it
flowing to P2 and visa versa. So Shields does not apply. Now assume
that the cost to D of satisfying P1's injunction is 70K and the cost of
satisfying P2's injunction is also 70K. There would be no aggregation,
even if the court took the defendant perspective when determining the
value of injunctions.
Q. 19 Question about Erie in
Supplemental Jurisdiction Cases
What if federal procedure applies to a federal question action, Erie
analysis says that state procedure applies to a state law action
brought in on supplemental jurisdiction, and the state and the federal
procedure simply are incompatible in the same case?
A. The answer appears to be that
federal procedure applies. Something similar happens with respect
privilege law. Under Fed. R. Evid. 501, state law privileges apply to
state law causes of action in federal court. But what if the state
privilege law says the material is excluded, federal privilege law says
it is included, and both state and federal actions are being
entertained by the same jury? The jury can't really consider the
evidence with respect the federal action but ignore it with respect to
the state law action. Federal courts have concluded that in this case
federal privilege law applies. E.g. Hancock v. Dodson, 958 F.2d 1367,
1373 (6th Cir.1992). I believe that the same thing would apply in your
example. But keep in mind that it is not always impossible that federal
procedure be applied to the federal cause of action and state procedure
applied to the state law cause of action.