WARNING!
This answer key does NOT take into account subsequent changes in the law. Some of what is said here may no longer be correct.
Civil Procedure
Law 112
Professor Green
Final Exam (Fall 1998)
Examination Number _________________
This exam has seven pages, including this cover sheet. It consists of
13 questions.
Question 2 has three subquestions. Question 6 has two subquestions. You
have four
hours for this exam.
The total number of points for the exam is 200. The points for each
question are
indicated. Pace accordingly.
Remember to keep the answers brief, organized and to the point. Write
in complete
sentences. When you start a new question, begin a new page in the
bluebook. Write on only one
side of each page of the bluebooks. Be sure to put your personal
examination number on each
bluebook and specify the bluebook number and the total number of
bluebooks, e.g. "1 of 4" or "2
of 5."
Write your examination number on this page and return this examination
with your
bluebooks.
Commercial outlines, hornbooks, treatises etc. are not permitted in the
examination. You
may bring into the examination only the following materials:
1) All materials assigned in this course:
Field, Kaplan & Clermont, Civil Procedure (7th ed. 1997)
Glannon, Civil Procedure: Examples and Explanations (3rd ed. 1997)
Federal Rules of Civil Procedure (Foundation Press 1998)
The set of Supplementary Materials that were available
through GMUSL print
services.
2) Any outline made by you or by a study group within which you participated
3) Your class notes.
The points given for correct citations to the Federal Rules of Civil
Procedure and to sections
of the United States Code will be minimal. For that reason (and because
you will probably be
very pressed for time), you should not take the time to look up a Rule
or section to get the correct
citation if you already know the answer. It is much more important to
know and to paraphrase
accurately what the Rule or section says than it is to get a Rule or
section number correct.
Do not simply quote a Rule or section. Put everything in your own words.
There may be more than one reason why something is not possible or more
than one
problem to be surmounted to show that something is possible. Spell each
out, while keeping your
answer brief.
If you need to make an assumption to answer a question, make your
assumption explicit.
Don't make an assumption if it is not necessary to answer the question.
1. Congress is considering passing a statute to protect abortion rights
by allowing for the
removal to federal district court of any civil case in state court the
outcome of which would ride
upon abortion rights derivable from the due process clause of the 14th
Amendment. In one
paragraph, is the statute constitutional and why or why not? [8 points]
2. A. P, a citizen of Wyoming, has sued D, a citizen of Colorado,
for state-law battery in the
Federal District Court for the District of Colorado. P's complaint
alleges that D hit him in a bar
room brawl in Denver in May of 1997, causing a number of injuries to P,
most prominently the
loss of sight in P's right eye. P is asking for $400,000 in damages.
Although D was throwing
punches at P, D believes that I, a citizen of Colorado, is the one who
threw the punch that harmed
P's eye. D therefore impleads I. In one paragraph, will D be able to
bring his impleader and why
or why not? Assume that personal jurisdiction and venue for the
impleader are satisfied. [10
points]
B. D also believes that P and P's partner, C, a citizen of Wyoming, are
responsible for an
injury D suffered while working on P's and C's ranch in Colorado in
June of 1996. D lost two
toes when a herd of cattle stampeded after their gate unexpectedly
opened. D believes that P and
C knew the lock on the gate was defective and failed to fix it. D
therefore brings an action against
P and C under state negligence law as a counterclaim to P's action
against D. D asks for
$100,000 from P and $100,000 from C in damages. In one paragraph, will
D be able to bring all
or part of his counterclaim and why or why not? Assume that personal
jurisdiction and venue for
the counterclaim are satisfied.
[10 points]
C. Assume that D is able to bring his counterclaim. A few weeks after D
files and serves his
counterclaim, P brings a state-law action against D in Wyoming state
court for losses to his cattle
as a result of the stampede, for which P alleges D was responsible. In
one paragraph, should P's
action in Wyoming be able to proceed? Assume personal jurisdiction by
the Wyoming court over
D is satisfied. [8 points]
3. P, a citizen of New York, has sued D1, a citizen of California, and
D2, a citizen of Nevada, in
California state court. There is personal jurisdiction over both D1 and
D2. P's complaint alleges
that either D1 or D2 committed state-law battery when one of them hit P
in a bar room brawl in
San Francisco. P asks for $80,000 in damages from defendant found to be
responsible for the
harm done to him. In one paragraph, may D2 remove all or some of P's
actions to federal court
and why or why not?
[8 points]
4. P1, a citizen of California, and P2, a citizen of the United
Kingdom, have sued D, a citizen of
New York, for state-law battery in the Federal District Court for the
District of Massachusetts.
P1's and P2's complaint alleges that D hit them in a bar room brawl in
Boston, causing a total of
$100,000 in damages, $80,000 of which was suffered by P1 and $20,000 of
which was suffered
by P2. In one paragraph, is there federal jurisdiction for any or both
of the actions against D and
why or why not? [10 points]
5. Congress has enacted the following statute: "Federal courts should
develop their own uniform
rules for determining what state's law applies in state-law actions in
federal court." In two
paragraphs, is the statute constitutional? [12 points]
6. P has sued D for state law negligence in the Federal District Court
for the Southern District of
Florida. After discovery has been completed, D makes a motion for
summary judgment and a
motion for Rule 11 sanctions. The Rule 11 motion claims that the
factual allegations in P's
complaint violate Rule 11. The court grants D's motion for summary
judgment but denies D's
motion for Rule 11 sanctions on the ground that the factual allegations
in P's complaint do not
violate Rule 11.
A. In one paragraph: Assuming that the court's decision concerning
summary judgment was
correct, doesn't its decision concerning Rule 11 sanctions have to be
incorrect and why or why
not? [10 points]
B. In one paragraph: Assuming that the court's decision concerning
summary judgment was
correct, doesn't that mean that P violated the pleading requirements
under Rules 8(a) and/or 9(b)
under the Federal Rules of Civil Procedure? [8 points]
7. P has brought suit against D for violation of section 10(b) of the
Securities Exchange Act and
section 10b-5 of the SEC regulations promulgated under the Act.
P's complaint alleges that D, an
officer of the C Corporation, misled P concerning how many oil leases
the C Corp. owned in
order to induce P to buy shares in the C Corp. According to P's
complaint, in February of 1997
D told P that the C Corp. had 200 leases, when in fact it had only 50.
P brings a motion for
summary judgment against D, offering in favor of his motion the
following two pieces of evidence:
1) an article from a financial magazine from September of 1997 in which
a reporter states that the
C Corp. had 50 leases in early 1997 and 2) an affidavit in which P
attests that D told P in
February of 1997 that the C Corp. had 200 leases. D offers no evidence
to contest the motion. In
two paragraphs, should P be granted summary judgment or partial summary
judgment and why or
why not? [12 points]
8. On June 30, 1997, P filed a complaint against D in the Federal
District Court for the Southern
District of New York alleging breach of contract. On August 31, 1997, P
served D by going to
D's home in Manhattan and leaving a copy of the complaint with D's
wife. On September 15,
1997, D filed with the court and served upon P's attorney an answer
pleading waiver and statute
of limitations as affirmative defenses to P's claim for relief under
the contract. P was allowed by
the court to submit a reply to D's answer. The court ordered that the
reply must be served by
October 31, 1997. On October 18, 1997, D moved to amend his answer to
include the defenses
of insufficiency of process and insufficiency of service of process. In
two paragraphs, should P's
complaint be dismissed for insufficiency of process and/or
insufficiency of service of process and
why or why not? (Ignore New York State's service of process statute for
the purpose of this
question.) [12 points]
9. The P Corporation filed a complaint in the Federal District Court
for the Eastern District of
Virginia against the D Corporation alleging that the D Corp. violated
federal antitrust law by fixing
the price of citric acid. The same day, the P Corp. served the S Corp.
with interrogatories. The
interrogatories asked for 1) the content of any statements made by
anyone at the D Corp. to
anyone at the S Corp. concerning any plan the D Corp. might have had to
fix the price of citric
acid and 2) the content of witness statements obtained by a private
investigator hired by the S
Corp. when the S Corp. was contemplating suing the D Corp. for fixing
the price of citric acid.
The interrogatory requested that C, the CEO of the S Corp., respond. In
two to three
paragraphs, must C respond to the interrogatories and why or why not?
[14 points]
10. P, a citizen of Indiana, brought an action against D, a citizen of
Illinois, in the Federal District
Court for the Northern District of Illinois under 42 USCA § 1983
(a federal statute allowing
plaintiffs to sue state officials for damages when the officials,
acting "under color of state law,"
violate the plaintiffs' constitutional rights). P's complaint alleged
that D violated P's constitutional
rights when he hit P in a bar room brawl in Chicago. P claimed that D,
although a private citizen
with no connection with the state of Illinois, was a state official
acting "under color of state law"
when hitting P because P and D got into a fight over whether there
should be a state income tax
and D hit P with the intent to vindicate the interests of the state of
Illinois. The district court judge
dismissed the action sua sponte in the following short opinion:
P's § 1983 action utterly and completely lacks merit. Indeed, it
is the most
improbable § 1983 action I have ever seen in my long years on the
bench. The
action is therefore DISMISSED.
P died soon after the dismissal of his 1983 action. Several months
later his wife and the executor
of his estate, E, brought a diversity action against D on behalf of P's
estate in the Federal District
Court for the Northern District of Illinois. E's complaint alleged that
D committed state-law
battery in the brawl and asked for $80,000 in damages. In two or three
paragraphs: On the basis
of what you know about this case what is the most promising affirmative
defense that D could put
in his answer to E's complaint, do you think this affirmative defense
will succeed, and why or why
not? [14 points]
11. The P Corporation, a distributor of kitchen equipment, sued the D
Corporation, a
manufacturer of kitchen equipment, in the Federal District Court for
the District of the District of
Columbia for breach of warranty under District of Columbia law. The P
Corp.'s complaint alleged
that the D Corp.'s use of a certain type of curved blade in its food
processors and its use of a
certain type of screw-on attachment to hold the blade in place led the
food processors to be
defective, forcing the P Corp. to recall the food processors it
distributed to stores. The P Corp.
alleged that the curved blades made the processors unable to cut
effectively after more than ten
uses and that the attachments put the blades at a high risk of flying
off during use. The court
granted the P Corp.'s motion for summary judgment, finding that the
curved blades and
attachments made the D Corp.'s food processors defective as a matter of
law, in violation of the
D Corp.'s warranty to the P Corp. The D Corp. was required to pay the P
Corp. $2 million in
damages. The D Corp. did not appeal.
Subsequently E sued the P Corp. for personal injuries due to a
defective food processor
that E had bought from a store that had received processors from the P
Corp. It seems that the P
Corp. was unable to recall the food processor before the sale to E. E
claimed that the food
processor's blade flew off because of the faulty attachment, causing
him to lose a finger. E's suit
was brought in the Federal District Court for the District of Maryland
and alleged a violation of
Maryland tort law. In its answer, the P Corp. denied that the
attachment was defective. In his
motion for summary judgment, E argued that the P Corp. could not
litigate the issue of whether
the attachment was defective. In three paragraphs, should the P Corp.
be able to litigate the issue
of whether the attachment was defective and why or why not? [12 points]
12. P visits L's law offices in California to complain that he had been
harmed by a $1 lighter he
bought from a drugstore in Sacramento, California. Some time after
purchase, the lighter flared
up, causing second and some third degree burns to P's thumb and
forefinger. It seems that in
attempting to light the lighters one can easily reset the height of the
flame to a dangerously high
level. Although P's damages are small (only $20,000), L is aware of
similar incidents occurring
and considers P to be a possible named plaintiff for a class action.
The lighters were sold
throughout the country with similar packaging and with no warnings
about the flareups. Around
two thousand have suffered harm from the flareups, although no one has
been harmed to a greater
extent than P. It is true that the D Corporation, the manufacturer of
the lighters, is doing very
poorly financially, but L thinks he can get at least a sizable part of
a class action judgment out of
the D Corp.
The D Corp. is incorporated in Delaware and has its financial offices
in Los Angeles,
California. Its primary business is the manufacture of lighters. The
manufacturing plant for the
lighters is in Allentown, Pennsylvania, which is where the lighters
were designed.
L plans to bring suit under state negligence law against D in the
Federal District Court for
the Northern District of California. P will be the named plaintiff for
a nationwide class that includes
all those who bought and were harmed by the defective lighters.
In addition to compensatory damages, L plans to ask for an injunction
requiring the D Corp.
to undertake an advertising campaign to inform those who bought the
lighters of their dangers.
In three paragraphs: What type of class action is this best brought as
and why? Assume that
personal jurisdiction, subject matter jurisdiction and venue are
satisfied. [12 points]
13. P lived in Carson City, Nevada from the time he was born until
November 1996. In
November 1996, he moved to Grass Valley, California to take a job with
a computer company,
although he believed when he moved that he would likely be transferred
to New York in
connection with his work at some point. The transfer has yet to take
place however.
In January 1997, P read about D's Used Car Lot ("D"), a Nevada
corporation, on D's web
page on the World Wide Web. D's only asset, a used car lot, is located
in Reno, Nevada. S, D's
sole shareholder, lives in Truckee, California. Although around 20% of
D's customers are from
California, D's only advertisements (aside from its web page) are
newspaper and TV ads in the
Reno/Sparks metropolitan area. This metropolitan area includes only a
small part of California
around Lake Tahoe and does not include Grass Valley, which is around 90
miles from Reno.
Despite the distance, P decided to travel to D in order to buy a used
Buick Skylark that
was advertised on D's web page. He paid $2,000 in cash for the Skylark
and drove it home that
day. A few months later, the Skylark caught fire while P was driving in
Grass Valley. P was
severely burned as a result.
P brought suit against D under state-law negligence, state-law breach
of warranty and
state-law strict product liability in the Federal District Court for
the Eastern District of California
(the district that includes Grass Valley and Truckee), asking for three
million dollars in damages.
California has the following jurisdictional statute:
Cal. C.C.P. § 410.10:
A court of this state may exercise jurisdiction on any basis not
inconsistent with the Constitution of this state or of the United
States.
In around eight to ten paragraphs: Is there personal jurisdiction,
subject matter jurisdiction
and venue for P's action against D? Ignore the California Constitution
for the purpose of this
question. [40 points]
END OF EXAMINATION
Answer Key for the Fall 1998 Civil Procedure (Law 112) Final
Prof. Michael Green
The following are the answers I was looking for in the Civil Pro Final.
1. This removal statute would expand federal question jurisdiction
beyond what is allowed under section 1331 by allowing for federal
jurisdiction when the 14th Amendment (in particular, abortion rights
under this Amendment) comes up in a civil case as a defense. The
question then is whether the Constitution gives to the United States
judicial power over such a case. Art. III, sect. 2 gives to the
U.S. judicial power to all cases “arising under” the Constitution and
this has been interpreted to include defenses. So the statute is
constitutional.
Most people utterly missed this question, bringing up
irrelevancies such as the Rules Enabling Act. The REA is
irrelevant first of all because a statute is at issue, not a Federal
Rule of Civil Procedure and second because one can never claim that a
statute is unconstitutional by pointing to another statute. A
statute is unconstitutional if it is incompatible with the
Constitution. The REA is not the Constitution. If the new
statute really were incompatible with the REA, which it is not, that
would simply mean that Congress had repealed (or partially repealed)
the REA by passing the new statute. For the same reason, it was
improper to rely on the removal statute, section 1441, or the federal
question statute, section 1331. These are not part of the
Constitution either.
You got points for the following:
1) mentioning that the constitutionality of the statute should be
assessed by looking to federal judicial power under Art. III section 2
2) recognizing that you had to determine whether the statute was
compatible with the constitutional scope of “arising under”
jurisdiction
3) recognizing that constitutional defenses are examples of “arising
under” jurisdiction
4) mentioning that the statute expanded federal jurisdiction beyond the
scope of section 1331 by allowing for constitutional defenses.
Points were sometimes taken off for important errors or
irrelevancies. Points were sometimes added or taken off depending
on the clarity and organization of the discussion.
2A. The impleader might be OK. If D is merely claiming that I
is the proper defendant and that P should be going after I rather than
D, then it is not OK, because Rule 14 allows an impleader by a
defendant only if the defendant is claiming that the impleaded party is
derivatively liable (e.g. through indemnification) to the defendant for
all or part of a judgment in favor of the plaintiff against the
defendant. Many of you did not state that I had to be liable to D
for the damages. You merely said that he had to be liable for the
damages, which left open the possibility that he was liable to P.
Points were lost for this.
But it sounds as if D and I were joint tortfeasors, since they
were both hitting P. That means that D could be claiming
contribution against I, which would make the impleader compatible with
R. 14. (I was looking for the words “contribution” and “joint
tortfeasors” here.)
But subject matter jurisdiction for the impleader remains.
There is no diversity jurisdiction, since the impleader is a suit by a
Coloradan against a Coloradan, and there is no federal question
jurisdiction, since the impleader is almost certainly under state
law. But there is supplemental jurisdiction under section
1367. You needed to say why. First of all the
impleader is part of the same constitutional case or controversy as P's
claim against D (NOT the same “transaction or occurrence” -- that is
not the test for supplemental jurisdiction). Second, although the
case with original jurisdiction (P's claim against D) is a diversity
action and adding the impleader is inconsistent with section 1332, the
impleader is not a claim by a plaintiff and so is not prohibited by
1367(b).
Points were sometimes taken off for important errors or
irrelevancies.
2B. D’s counterclaim against P is allowed as a permissive
counterclaim under R. 13(b). It need not concern the same
transaction or occurrence as P’s claim against D.
C can be brought in under R. 13(h) because joinder of parties is
allowed under R. 20. Joinder under R. 20 is allowed because D’s
claim against C concerns the same transaction or occurrence as D’s
claim against P and the two claims share at least one question of law
or fact in common. Many of you wrongly thought that C could be
joined only if D’s claim against C concerned the same transaction or
occurrence as P’s claim against D. That’s not so. Some
thought C was a necessary party under R. 19. That’s not so
either.
But the question remains whether there is federal subject matter
jurisdiction for the counterclaim. There is, under diversity
(section 1332), since the parties are completely diverse (D is from
Colo. and P and C are from Wyoming) and because the jurisdictional
minimum was reached.
Points were sometimes taken off for important errors or
irrelevancies.
2C. Because P’s claim against D in Wyoming state court concerns the
same transaction or occurrence as D’s counterclaim against P in federal
court in Colorado, under R. 13(a) P’s claim is a compulsory
counterclaim to D’s counterclaim and so, under the Federal Rules,
should have been brought in the Colorado case.
But P’s claim against D is brought in Wyoming state court.
So you had to note that the Wyoming state courts would probably help
federal courts enforce R. 13(a) even thought they might not have its
analogue in their own rules of procedure.
P’s Wyoming action is not claim splitting because P did not bring
the Colorado stampede action. Res judicata does not apply, first
of all because P did not bring the Colorado stampede action and
secondly because there is no final judgment in the Colorado stampede
action.
Points were sometimes taken off for important errors or
irrelevancies.
3. Removal is not proper. Although section 1332 is satisfied,
since the parties are completely diverse and the jurisdictional minimum
was satisfied, in non-federal question cases removal is not proper if a
defendant is from the forum state. Since this is a diversity case
and D1 is from California, D2 cannot remove. You lost points if
you said that removal can never occur if a defendant is from the forum
state. That’s not true since removal is OK in a federal question
case even when a defendant is from the forum state. You also lost
points if you said that only D1 could not properly remove but that D2
could.
Another reason removal is not proper is because D1 did not
consent to the removal.
Points were sometimes taken off for important errors or
irrelevancies.
4. There is federal jurisdiction for both actions against D.
First of all, complete diversity of parties is satisfied under
1332(a)(3) since this is an action between citizens of different states
in which citizens or subjects of a foreign state are additional
parties. You could also have said that P1's action falls under
1332(a)(1) and P2's action falls under 1332(a)(2). (You got extra
bonus points for noting that P2's claim would not satisfy diversity if
he was a permanent resident and domiciled in New York. See
1332(a).) In addition, the jurisdictional minimum for P1's action
against D is satisfied. But there is a problem with P2's action since
the jurisdictional minimum is not satisfied.
Aggregation of P1's and P2's claims is not allowed. (There
is no common and undivided interest here. Just because P1 and P2
have claims involving the same bar room brawl does not mean that they
share a common and undivided interest.)
But there is supplemental jurisdiction for P2's claim under
section 1367. First of all P2's claim is part of the same
constitutional case or controversy as P1's claim. Second,
although the case with original jurisdiction (P1's claim) is a
diversity action and adding P2's claim is inconsistent with section
1332, P2's claim is not a claim by a plaintiff against a person made a
party under Rs. 14, 19, 20, or 24 and P2 did not join under Rs 19 or
24. This interpretation of 1367 is controversial however,
something that should have been noted.
Note that federal jurisdiction is the same thing as subject
matter jurisdiction. The question is whether a federal court may
entertain the action. Discussions of personal jurisdiction or
venue were irrelevant.
Points were sometimes taken off for important errors or
irrelevancies.
5. This statute allows federal courts to come up with uniform
federal choice-of-law rules for diversity cases. In effect, it
abrogates the Supreme Court’s decision in Klaxon. Klaxon decided
that, under Erie, the choice-of-law rules of the forum state had to be
followed in diversity cases in order to avoid forum-shopping and
inequity between federal and state courts.
But notice that Klaxon did not concern a federal statute that
compelled federal courts to come up with their own choice-of-law
rules. The question in Klaxon was merely whether federal courts
should come up with such rules on their own. Once Congress has
decided to speak on the issue, the question becomes not the
York/Byrd/Gasperini one of whether federal choice-of-law rules will
promote forum shopping and differential outcomes between state and
federal courts and what the countervailing federal policies are, but
the simple question of whether choice-of-law rules are arguably
procedural and so within Congress’s power to regulate the procedure of
the federal courts. Choice-of-law rules are arguably procedural,
so the statute is constitutional.
Most recognized that this was an Erie question, but many got
things wrong after that. Some looked at the statute from the
perspective of the Rules Enabling Act, which is doubly wrong: 1) a
statute, not a Federal Rule, is at issue and 2) the constitutionality
of a statute cannot be determined by looking to another statute.
Many also looked to the Rules of Decision Act, which is also
irrelevant, since the RDA is not part of the Constitution. Many did not
realize that choice-of-law rules were at issue. And many cited
irrelevant cases, like Byrd or York. Byrd and York are irrelevant
because they concern federal common law (judicially created) rules of
procedure that are in conflict with state rules. Here there is a
statute directing federal courts to come up with choice-of-law
rules. So the question is similar to that in Hanna - are the
rules created by federal courts under the direction of Congress
arguably procedural? They are, so the statute is constitutional.
Points were given for the following:
1) recognizing that the statute concerned choice-of-law rules
2) mentioning that this statute is contrary to Klaxon (or Day &
Zimmerman, which reaffirmed Klaxon)
3) recognizing that because a federal statute is at issue rather than a
common law procedural rule, the only concern is whether Congress has
the constitutional power to enact the statute and that since the rules
that the statute directs federal courts to create are arguably
procedural, the statute is constitutional
4) noting that despite the fact that the statute is constitutional, it
might promote the forum shopping that was of concern in Klaxon
Points were sometimes taken off for important errors or
irrelevancies. Points were sometimes added or taken off depending
on the clarity and organization of the discussion.
6A. Just because summary judgment in favor of the defendant was
granted does not mean that the court’s decision not to grant R. 11
sanctions against the plaintiff was wrong. Note that I specified
in the question that the court decided not to grant R. 11 sanctions
because the factual allegations in P’s complaint did not violate R.
11. Some of you said the two orders were compatible because the
judge could have exercised his discretion not to sanction. That
was not the reason given by the judge. Some of you spoke of how
P’s legal arguments could have satisfied R. 11 even though summary
judgment was granted to D, citing the Golden Eagle case. Factual
allegations, not legal arguments, were at issue. Some of you
noted that R. 11 does not apply to discovery abuse. True, but the
R. 11 sanctions concerned P’s complaint, not his discovery
requests. The point of the question is making sense of how
P’s factual allegations in the complaint can not violate R. 11 and yet
summary judgment can be correctly granted to D.
In grading this question, the first thing I looked for was an
articulation of why one might think that granting summary judgment to
the defendant is incompatible with the factual allegations not
violating R. 11. If D got summary judgment, that meant that on
the basis of the evidence offered by each side, no reasonable jury
could find in favor of P. That would suggest that P had no
evidentiary support for his factual allegations. If he had some
evidentiary support there would be evidence on each side to weigh and
so summary judgment would have been inappropriate.
The solution is to look to R. 11(b)(3). The signer of a
pleading states that “to the best of the person’s knowledge,
information, and belief, formed after an inquiry reasonable under the
circumstances . . . the allegations and other factual contentions are
warranted on the evidence or, if specifically so identified, are likely
to have evidentiary support after a reasonable opportunity for further
investigation or discovery.” I was looking for a number of
explanations of the compatibility of the orders on the basis of
(b)(3). First of all, the lawyer could have reasonably believed
(not had a “good faith belief”) that there was evidentiary support and
simply have been wrong about this. For example, his client could
have lied to him in a manner that the lawyer could not have uncovered
after reasonable investigation. Second, the lawyer could have
identified a factual allegation as unsupported but as likely to be
supported during discovery, have reasonably believed that it would be
supported, and simply have been wrong about this. Another
creative explanation is that P had evidentiary support for his
allegations but D had iron-clad evidence in favor of a affirmative
defense unanticipated by P in his complaint. There were other
possibilities.
The maximum points were given for articulating the problem and
for providing a number of solutions. Most of you did not
articulate the problem and provided only one solution, if that.
Points were sometimes taken off for important errors or
irrelevancies. Points were sometimes added or taken off depending
on the clarity and organization of the discussion.
6B. First of all, fraud or mistake are not being alleged here, so R.
9(b) does not apply. Discussions of In re Glenfed etc. were
therefore irrelevant.
Many of you treated this question as if R. 11 and R. 8(a) are
equivalent and so said that P’s complaint could have satisfied R. 8(a)
because it was evidentiarily reasonable or non-frivolous. The
whole point of questions 6A and 6B was making sense of the differing
contributions that R. 11 and R. 8(a) made to pleading. Mixing
them up was a big mistake.
Lack of evidentiary support is not R. 8(a)'s point. Indeed,
P could have lied and still satisfied R. 8(a). All R. 8(a) asks
for is a short and plaint statement of why relief should be
granted. The facts alleged could be utter lies without
evidentiary support at all and R. 8(a) would still be satisfied,
although R. 11 would be violated. This point was made in very few
answers although many of you noted that you don’t have to provide much
in the way of facts to satisfy R. 8(a). Still, some facts have to
be alleged in a complaint and it is important to understand that R.
8(a) does not require that they have evidentiary support at all.
That’s R. 11's job.
Points were sometimes taken off for important errors or
irrelevancies. Points were sometimes added or taken off depending
on the clarity and organization of the discussion.
7. If you simply said that D did not offer evidence in response to
P’s motion for summary judgment and so (under R. 56(e)) summary
judgment should be granted to P, you got O points. This answer
showed a profound misunderstanding about summary judgment. Under
R. 56(e), only if P’s motion is supported does D have to offer evidence
in response and there are innumerable reasons why P’s motion is not
supported.
First of all, I was looking for an articulation of the standard
for summary judgment. Summary judgment for P should be granted
only if a reasonable jury would have to find for P with respect to
every element of the cause of action.
With that in mind, even if all the evidence presented by P were
admissible, P has failed utterly to satisfy this standard. Many
elements have no evidence in their favor. Most importantly there
isn’t a scrap of evidence that D made his statement with knowledge or
reckless indifference as to its falsity. There is no evidence
that P suffered damages much less damages that satisfied the proximate
causation requirement. Indeed, there is no evidence that P bought
a security or bought it in reliance on the statement.
Second, the article is hearsay and so is inadmissible for the
purpose of summary judgment. It is an out of court statement (it
is an article, not testimony at trial) offered in favor of the truth of
the matter asserted. It states that there were only 50 leases in
early 1997 and P introduced it in favor of the proposition that there
were only 50 leases in early 1997.
The affidavit is admissible. Although it is hearsay, there
is an exception from the rule for affidavits from those who will be
testifying at trial (which presumably D will be doing). Nor is
the affidavit inadmissible because its content is hearsay. The
content of the affidavit (that D said to P that there were 200 leases)
is not being offered in favor of the truth of the matter
asserted. P does not present this content to show that there were
200 leases -- he is offering it to show that P said that there were 200
leases. P’s whole argument is that there weren’t 200 leases.
The question about partial summary judgment still remains.
Many of you did not address this at all.
Partial summary judgment can be granted to a P with respect to an
element of a cause of action if no reasonable jury could find against
the P concerning that element.
So the question remains whether a reasonable jury would have to
find that D made the statement that there were 200 leases and that the
statement was false because there were only 50. Once again, the
mere fact that D has offered no evidence against P is not
dispositive. P’s evidence has to be such that it would have to
convince a rational jury. Even if you missed that the article was
hearsay, the question remains whether a reasonable jury would have to
find in favor of P on the basis of the unopposed article. The
article says that there were 50 leases in early 1997, not February of
1997, and we don’t know how the reporter came by that
information. I didn’t care which way you went on this issue (you
could have said it was enough for partial summary judgment or was
insufficient) -- all I was looking for is a sensitivity to the
criterion for summary judgment here. Points were lost for
assuming that merely because the article was unopposed partial summary
judgment had to be granted to P on the falsity element of a 10(b)
violation.
What about the unopposed affidavit by P stating that D said to
him that there were 200 leases in February of 1997? One might
think that, because a fact-finder might disbelieve P if he testified at
trial, summary judgment should not be allowed with respect to the
“statement” element of a 10(b) violation either. But if that were
so then it’s hard to see how affidavits could ever support summary
judgment motions, since the fact-finder could always not believe the
affiant. In general, if the affiant is unopposed (and there is no
internal inconsistencies in the affidavit casting doubt upon it etc.),
then the matter is conclusively established for summary judgment
purposes, even if there was no admission on the part of the other
side. But I did not take points off for those who said that the
affidavit was insufficient to establish that D said to P that there
were 200 leases however, since this point, although in error, showed a
sensitivity to the requirements for summary judgment.
So, in the end I was looking for the answer that P should be
granted partial summary judgment concerning D’s having said that there
were 200 leases in February.
Many of you discussed In re Glenfed. This case is
completely irrelevant. It concerns pleading standards for
securities cases under R. 9(b). There is nothing about the
pleadings in the question. The question concerns summary
judgment.
Points were sometimes taken off for important errors or
irrelevancies. Points were sometimes added or taken off depending
on the clarity and organization of the discussion.
8. First of all, was R. 4 violated? There was no summons
delivered with the complaint, so R. 4(c)(1) was violated. This
meant that there was insufficient process. In addition, service
was by a party (P), so R. 4(c)(2) was violated. Thus there was
insufficient service of process.
But under R. 12(h)(1), these defenses are disfavored and so must
be in (1) the pre-answer motion or (2) if there is no pre-answer
motion, in the answer or (3) in an amendment of right of these
documents under R. 15(a).
Many of you simply said that because 20 days had gone by there
was no possibility of an amendment of right. In fact one can also
amend of right (once) any time before a responsive pleading is served,
if a responsive pleading is permitted. Here a responsive pleading
(a reply) was permitted and D amended his answer before the reply was
served on him, so the defenses were saved. P’s complaint should
be dismissed.
Many of you wrongly said that the defenses could be preserved if
the court exercised its discretion to allow an amendment. That’s
not so. The defenses are preserved only if the amendment is of
right.
Points were sometimes taken off for important errors or
irrelevancies.
9. There are many things wrong with these interrogatories.
First of all, interrogatories can be served only on parties under
R. 33. In addition a party may not seek discovery (with immaterial
exceptions) until there has been a “meet and confer” among the parties
to set up a discovery plan, something that surely has not happened yet
since P served S with the interrogatory on the same day he served D
with the complaint. R. 26(d). In addition, since the
interrogatories were served on the corporation S, not on C, any officer
or agent of S can speak for S -- P cannot tell S who will speak for it.
R. 33(a). (No one got this, although I mentioned it in class.)
The first interrogatory asks for material that is hearsay, but
that is not a reason for it to be not discoverable, as long as it is
reasonably calculated to lead to admissible evidence, which it surely
is.
The second interrogatory asks for material prepared by S in
anticipation of litigation in another case. Thus it might be
thought of as work product. You got points if you treated the
material as work-product. You also should have noted that R.
26(b)(3) does not apply because “documents and tangible things” were
not requested (only the content of the witness statements) and that the
work product protection thus would have to come from the Hickman case
itself. You also needed to note that the privilege is qualified
and can be overridden by P’s showing substantial need and the inability
to obtain the substantial equivalent without undue hardship. (The
witness statements were obtained by a P.I. and so probably did not
contain attorney’s theories or other opinion work product. As a
result, the unqualified privilege for opinion work product would not
apply.) You also should have noted that it does not matter that
this material was prepared in anticipation of litigation that was now
over. (The Duplan case is somewhat relevant here.)
But in fact the material probably is not work product because S
is not a party. Neither S nor C can assert the work-product
exception under R. 26(b)(3) because that extends only to parties.
But this is controversial and when the non-parties’ material is
prepared in anticipation of related litigation (as is the case here)
some courts have said that the Hickman case itself can provide
protection. After all, if the litigation is related, then the
non-party might suffer from having to divulge the material.
Indeed, the non-party might become a party later.
Because the issue is a disputed one, I gave points both to the
people who said it was work product and to the (very few) people who
said that it was not work product because the privilege can extend only
to parties.
Points were sometimes taken off for important errors or
irrelevancies.
10. Res judicata (claim preclusion) is the most promising
affirmative defense. There is an identity of claims because the
section 1983 action and the battery action concern the same transaction
or occurrence. The transactional test is the one used currently
by federal courts. Although more restrictive understandings of a
claim have been used in the past, particularly by some state courts,
they would not be used by federal courts now. If you said there
was no identity of claims because one action was under section 1983 and
the other was under battery, this was a profound misunderstanding
concerning the principle of res judicata in federal courts.
You should have noted that res judicata is applicable against E
even though she was not a party to the first action because she is in
privity with P.
You should also have noted that there was a final judgment.
The most problematic issue was whether the judgment in the
section 1983 case was on the merits. Relevant to this question is
R. 41. The court did not say that its dismissal was without
prejudice. Therefore there is a reason to believe it was "on the
merits" (under R. 41) unless the dismissal was for lack of
jurisdiction, improper venue or failure to join a party under R.
19. It looks like it was a dismissal for failure to state a
claim. That would mean it was a judgment "on the merits."
But the fact that it was a federal cause of action and it was dismissed
as being utterly frivolous opens up the possibility that it was
dismissed for want of federal subject matter jurisdiction. See
Bell v. Hood. If so E might be able to avoid the dismissal being
"on the merits" under R. 41. But, as the recent case of Semtek Intern.
Inc. v. Lockheed Martin Corp. makes clear, a judgment can fail to have
claim preclusive effect even if it is "on the merits" as far as R. 41
is concerned. Nevertheless, it is common for federal courts to give
claim preclusive effect to dismissals for failure to state a claim. See
Rinehart v. Locke. Therefore, the argument that it was dismissed for
lack of subject matter jurisdiction is the best avenue to avoid claim
preclusion.
Some thought the claims were different (or forgot that P and E
were in privity) and so applied collateral estoppel. That
couldn’t work however, since there are no important issues that were
actually litigated in the section 1983 case that would help resolve the
battery case in D’s favor.
11. This is a judicial estoppel case, since P asserted one thing in
litigation, prevailed, and asserted the opposite in subsequent
litigation. But judicial estoppel is a controversial doctrine,
something you needed to note, so you had to decide what law to look to
to determine whether it applies, which brings up Erie issues.
Some federal courts point to the fact that judicial estoppel exists to
protect the court, not the parties, to argue that in a diversity case
federal law of judicial estoppel should be applied. Other federal
courts (as in the Konstantinides case) look to state law in diversity
cases. If so then Maryland state law would apply (one looks to
the state law of the forum where judicial estoppel is being applied,
not the state law of the court that rendered the first judgment -- see
Konstantinides). Konstantinides suggests that Maryland courts
would not apply judicial estoppel. Also P could escape judicial
estoppel if it could show good cause for the change of positions, for
example, newly discovered evidence.
Many applied offensive nonmutual collateral estoppel
instead. In fact, that does not apply because only adverse
determinations of an issue can bind a party under collateral estoppel
in subsequent cases. However, if you discussed collateral
estoppel, you got some points. You needed to mention the criteria
for collateral estoppel. In particular it was important to
mention that the issue had to be essential to the first judgment,
something that is a problem in this case because there were alternative
grounds for the judgment (the blade and the screw). There are
different approaches to this problem in the Second and First
Restatements of Judgments, something you should have mentioned.
You should also have mentioned the considerations in Parklane Hosiery
that must be taken into account before offensive nonmutual collateral
estoppel is applied.
12. I originally wrote this question with many questions in mind,
but omitted them at the last minute without rewriting the question
because I thought the exam was too long. In the end all I asked
was what kind of class action should be brought. Questions of
aggregation of claims, supplemental jurisdiction, etc. should not have
been addressed. All you needed to do was argue whether a R.
23(b)(1)(A), (b)(1)(B), (b)(2) or (b)(3) class action should be
brought. You did not have to discuss the criteria under 23(a)
either, since all class actions have to satisfy them.
The most promising is a (b)(1)(B). Because the D Corp. was
doing poorly financially, without a class action potential plaintiffs
not included in the first litigation may as a practical matter be
impeded in their ability to protect their interests. This is
what’s known as the sinking fund class action. This approach is
better than (b)(2) because injunctive relief is not the primary relief
requested. A (b)(3) class action is a problem because you have to
show that common questions of law and fact predominate (something that
does not have to be done in a (b)(1)(B) or (b)(2)). That’s a problem
with a nationwide class in a case like this because many different
state laws will be applied. In addition, the D will be able to
assert affirmative defenses such as contributory negligence that will
ride on specific facts concerning each plaintiff. A (b)(1)(A)
class action is not appropriate either since individual plaintiff are
not likely to have injunctions in their favor that would submit D to
inconsistent obligations.
But which class action you chose does not matter as much as your
mentioning these considerations in connection with each.
13.
Venue. This part could be answered merely by saying that
venue for diversity actions is covered by § 1391(a) and venue in
the Eastern District of California would be appropriate under that
provision because a substantial part of the events or omissions giving
rise to P’s claim (namely the car fire in Grass Valley) occurred in the
Eastern District of California. See 1391(a)(2). Many
referred to 1391(c) and said that venue was also appropriate in the
E.D. Cal. because that is where a defendant would be subject to
personal jurisdiction. This is an argument for venue only by reference
to 1391(a)(1), which allows venue in any district where the defendant
resides if all defendants reside in the same state. Many of you did not
refer to1391(a)(1). Furthermore, as we shall see below, there are
substantial questions about whether there is PJ over D in California,
and thus whether there would be PJ over D in the E.D. Cal. if it were
considered a state on its own. Some of you referred to 1391(a)(3). But
that provision can be used only when there is no other district in
which the action may otherwise be brought. Here there clearly is venue
in D. Nev. Many spoke of whether there was venue in
California. That’s wrong. Venue concerns federal judicial
districts, not states.
Subject Matter Jurisdiction. There was diversity
jurisdiction. First of all, the jurisdictional minimum was
satisfied by the claim for $3 million in damages. Burns are
serious injuries, so it is very unlikely that it was legally certain
that P would get less than the jurisdiction minimum.
D was domiciled in Nevada. Nevada was its place of
incorporation and was its principal place of business, since that is
where its sole asset, the car lot, was located. The location of
the shareholder of the corporation, S, is irrelevant for
determining the domicile of the corporation for diversity
purposes. It’s possible of course that S performs some other role
that might make him relevant for determining the principal place of
business, but nothing about another role was stated in the question so
he should be ignored.
P was domiciled in California. The test is whether he
resided in California with the intent to make it his home for the
indefinite future. It’s true that he thought he would move to New
York subsequently, but that event was in the indefinite future (there
was no set date), so he established domicile in California. See
Baker v. Keck. If he had not established domicile in California,
his domicile would continue to be Nevada (not New York, since he has
not yet moved there) and diversity would have been destroyed.
Personal Jurisdiction. First of all, this is an action in
federal court. Therefore the constitutional restriction on
jurisdiction under the 5th Amendment has to be satisfied. It is,
since it is clear that D has minimum contacts with the United
States. But under Fed. R. Civ. P. 4(k), federal courts’ service
of process is effective to establish personal jurisdiction only if a
state court of general jurisdiction located in the state where the
federal district court is located would have had personal
jurisdiction. So one must look to whether a California state
court would have had personal jurisdiction under the state’s long-arm
statute and under the 14th Amendment. (I specified in the
question that the effect of the California Constitution, which could
also restrict personal jurisdiction, should be ignored). The
California long-arm statute reaches to the extent of the two
constitutions, so it can be set aside. The question then is
whether the exercise of personal jurisdiction by a California court
would have violated the 14th Amendment.
There are two questions that have to be answered concerning
personal jurisdiction. First, would a California court have power
over D? Second, would it be unduly burdensome or unfair to
exercise personal jurisdiction? Clearly it would not be unduly
burdensome or unfair, since, unlike the Asahi case, D need only travel
a short distance to litigate the case in the E.D. Cal.
To determine whether a California court would have the power to
assert personal jurisdiction one needs to employ the Int’l Shoe minimum
contacts analysis. I will mention only the most important issues
that an answer should have addressed in connection with this analysis.
The first issue is whether there was general jurisdiction of the
sort that was applied in the Perkins case, that is, jurisdiction for
causes of action unrelated to the activities by the corporation giving
rise to jurisdiction. Under Int’l Shoe general jurisdiction would
require substantial continuous activities in the state -- activities
basically sufficient for one to say that the corporation was located in
that state. That is unlikely in this case, since D has no agents
physically located in California. If there is jurisdiction, it
would have to be specific jurisdiction.
The most important issue in this question was distinguishing this
case from World Wide Volkswagen, which would suggest that there was no
specific jurisdiction. Under WWV, the fact that a consumer
brought the product into the forum state was insufficient to establish
jurisdiction in the forum state, even if the consumer’s bringing the
product in the forum state was foreseeable. This case too is one
where the plaintiff brought the product into the forum state.
How can WWV be distinguished? You have to point to
affirmative acts by D that reached out to the forum state. The
fact that 20% of D’s customers come from California is not an act of
reaching out to California. The customers come to D, not the
other way around. So that is not a reason to allow for specific
jurisdiction. Many of you got this wrong.
What about D’s web site, which motivated P to go to D’s car lot
in Nevada? It surprised me how many of you blithely took the web
site to involve the solicitation of business in California, which would
allow for specific jurisdiction over D in a manner similar to the McGee
case. That would mean that anyone who set up a web site would be
subject to worldwide jurisdiction. Is that really
plausible? Shouldn’t it be relevant that P had to seek out the
web site? Couldn’t that make P the person who reached out?
These issues should have been discussed.
In addition there were the TV and newspaper ads in
California. The problem with these ads was that they were not
directly related to the cause of action, since P did not purchase the
car in response to these ads. Nevertheless they were somewhat
related, since they were solicitations for customers for cars. It
is possible that these ads were substantial enough and related to the
cause of action enough to allow for specific jurisdiction.
I was not so concerned with how you came out on the issue of
personal jurisdiction as much as whether you brought up these problems.
Some errors. The 100 mile bulge rule in R. 4(k)(1)(B)
did not apply here, since D was not brought in under Rs. 14 or
19. In addition, this was not really a “stream of commerce”
case because there was no subsequent sale of the car in
California. Discussions of Asahi were not that relevant.