Seinfeld Jurisdiction 2008

8/3/2019 Seinfeld Jurisdiction 2008

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I. Jurisdiction over Persons and PropertyFirst: Does a state courts exercise of jurisdiction fulfill statutory requirements?

Under the statute, does the court have the power to bind both D (stringent) and P (automatically met where Pactually filed, otherwise, Phillips Petroleum)?

Under the statute, was D given sufficient notice?

Second: Does the statute violate due process?

Within the confines of the constitution, does the court have the power to bind both D and P?In state court, apply state long-arm statute for out-of-state s. (automatic j against domicil s)In federal court, apply the rules of the state in which you sit under 4(k)(1).Jurisdiction over a P: Did P consent by filing, or implicitly consent by failure to opt out of a class?Different types of jurisdiction over foreign Ds in state court.

1. In personam jurisdictiona) Court can adjudicate any rights associated with the D (over which it also has SMJ).

b) Old rule:Jurisdiction estd by personal service in forum state, or consent. (Pennoyer)c) New rule: Jurisdiction estd by personal service in forum state (probably-Burnham), consent

(Szukhent), or when D has sufficient minimum contacts with the forum under International Shoe andthe exercise of jurisdiction not fundamentally unfair (World Wide Volkswagen/Asahi).

(1) However, a FSC may be honored in a way that prevents the exercise of pers j where it wouldotherwise lie. (The Bremen).

2. In rem jurisdictiona) Court may only adjudicate rights associated with the property at issue.

b) Old rule: Property must be physically present in the jurisdiction; notice must be given, thoughpublication suffices where actual notice cant be given. (Pennoyer)

c) New rule: There must be minimum contacts under International Shoe among the defendant,litigation, and forum. Practically, real property always will pass; tangible personal property will almostalways pass (unless brought into forum by unilateral action of a third party); intangible property will notpass without further contacts b/t the forum & the litigation.

3. Quasi in rem jurisdiction

a) Court may adjudicate rights not associated with property (i.e., underlying lawsuit may not be aboutproperty), but recovery is limited to the value of the property.

b) Old rule: valid under the same circumstances as in rem

c) New rule: There must be minimum contacts under International Shoe among the defendant,litigation, and forum. Practically, quasi-in-rem cases will rarely be used because got to go through thesame hurdles as personal jurisdiction AND recovery will be limited to the amount of the property.

A. In Personam Jurisdiction

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1. Strict TerritorialismThe old rule

a) Pennoyer v. Neff(SCOTUS 1877). Pennoyer acquired property from Mitchell, who had received titleto the property in a lawsuit against Neff. Issue: Was the initial judgment in OR court granting Mitchelltitle valid, or did OR lack jurisdiction over Neff? Holding: trial court did not have jurisdiction over a

foreign D, and Pennoyers title is t/f invalid.Rule: In order to establish in personamjurisdiction over a foreign defendant, a state court must:

(1) Have the defendant voluntarily appear, OR(2) Personally serve the defendant in the forum state

(a) Service by publication is insufficientIn order to establish in remjurisdiction, court must:

(1) Attach the property prior to the lawsuit, AND

(2) Serve the defendant EITHER personally or by publication (where allowed by statute)Analysis: Here, the property was not attached until after the judgment, so in rem jurisdiction did not lie.Because the D was not personally served in OR, in personamjurisdiction will not lie either. Because ORhad neither in rem nor in personamjurisdiction, its judgment was invalid under the 14 th

Amendments due process clause. Abrogated by International Shoe; perhaps partially upheldby Burnham.

b) Policy

(1) States are equal sovereigns whose power does not extend beyond persons or property withintheir territory

(2)Tension between states rights and individual due process as justification for strictterritorialism

(a) Remedied if you view federalism as protecting individual due process.2. The Modern Rule

a) Generally(1) Int'l Shoe Co. v. WA (SCOTUS 1945) - minimum contacts test. Facts: Washington suesforeign corporation in Washington court for failure to pay into state unemployment comp fund.Although D has no office in WA & doesn't contract for sales there, it employs 11-13 salesmen wholive in WA & solicit mail orders from Washington residents. Washington serves the corporation bymail (in addition to providing inadequate personal service). Issue: Does Washington statute, whichallows for service by mail against a foreign corporation, violate due process? Held, not as appliedhere. Rule: A state does not violate due process where it exercises jurisdiction over a foreigndefendant that has sufficient minimum contacts with the state "such that the maintenanceof the suit does not offend traditional notions of fair play and substantial justice."

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(a)Where corporation engages in "continuous & systematic" activities that "giverise to the liabilities sued on," corporation has min contacts.(b)Where single act has certain "nature and quality and circumstances", may beenough to lead to j.

Policy:(c) Where a D enjoys the benefits of a states laws, it should be subject to the jurisdiction of

the states courts.(d) Fairness to an individual D, as opposed to states rights, are the primary concern.NB: Fairness relates to power, not the fairness of the laws that would apply onthe exercise of that power.

(2) McGee v. Int'l Life Ins. Co. (SCOTUS 1957). P. 5. Facts: Insurance company sells a lifeinsurance policy in California. The company that bought out the initial company contacts McGeeand get him to extend policy. McGee dies, no coverage, suit in California court. Issue: Does aCalifornia statute granting CA court personal jurisdiction over the insurance company, which hasno other contacts with CA beyond this single policy, meet the minimum contacts standard? Held,yes. A single contract may constitute minimum contacts to establish personal

jurisdiction over a D for all matters arising from that contract.Policy:

(a) Plaintiff would be unable to sue elsewhere as a practical matter(b) Not unfair to D because it purposefully availed(c) California has an interest in providing effective redress

(3) Hanson v. Denckla (SCOTUS 1958). Woman who creates trust in PA w/ DE company.Woman moves to FL, where she continues to do communicate with the trust company. Womandies in FL. Issue: Did FL courts have j over out-of-state trust company? Held, no. The company didnot solicit business from the woman in Florida.Rule:To establish personal jurisdiction on the basis of a single act:

(a) Foreign D must purposefully avail itselfof the privilege of conducting activities withinthe forum state via affirmative action [passively allowing a relationship to continue isinsufficient].

(i) Unilateral activity by a P or third party does not establish minimum connectionbetween a D and a forum state.

(b) Foreign D must have somereason to know that single act will possibly subject it topersonal jurisdiction in the forum state.

(i) A state statute providing for expansive jurisdiction of foreign Ds may suffice.

(c) State should probably have manifest interest in providing redress thats special tothis class of cases.

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b) Specific jurisdictionGot to make all the connections in the personal jurisdiction triangle:

Defendant-Litigation-Forum-Defendant

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SPECIFIC JURISDICTION(1) Relationship between D and forum:

D is personally served in forum state

D consents to jurisdiction

D has minimum contacts with the state so that traditional notions of fair play and substantial justice arent offended.o Under WW Volkswagon/Asahi, Threshold question: Do minimum contacts exist?

Any area of law :

Foreign D engaged in "continuous & systematic" activities that "give rise to the liabilitiessued on." Intl Shoe

Foreign D engaged in a single act within the forum state and (1) act = purposeful availment ofthe benefits of doing business in the forum, (2) D on notice that it could lead to jurisdiction[reasonable foreseeability], and (3) state has manifest interest in exercising j in this specificclass of cases. McGee

Foreign D who is an employee of a corporation must meet requirements for personaljurisdiction independent of the corp. Calder.

Choice of law or the fairness of the states law is irrelevant to this inquiry. Hustler

Libel (but probably any area of law) : Foreign D corp. directly sold product in jurisdiction. Hustler.

Products liability:Foreign D placed product in a stream of commerce, the product was sold inthe forum state, and the sale was foreseeable (Worldwide Volkswagon, foreseeable use not enough)AND POSSIBLY

D purposefully directed product at forum (purchase plus in theAsahi plurality)

D had a sufficient volume of sales (Stevens rationale inAsahi)

Intentional tort: Harm was foreseeably concentrated in the forum state.Calder(circuit split:targeted?)

Contract law: Foreign D entered into k with domestic party, and k required an ongoing relationship.Burger King.

Domestic relations: anything that's outside the internal family dynamic that creates sig contacts withthe forum state? Significant effects are not, in themselves, sufficient. Kulko.

o Possible second question: even w/ min contacts, is it fair to exercise jurisdiction? (likely at least in products

liability cases)

Burden to

Interests of the forum State

's interest in obtaining relief

Interstate judicial system's interest in efficient resolution

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Interests of the several states in furthering certain policies. (Asahi)(2) Relationship between litigation and forum:

Facts at issue in litigation must arise directly out of the reason for the connection between the D and the forumo P is not required to have contacts with state, though they can help. Hustler(though many states will require it -

look at state long-arm statute first)(3) Relationship between and litigationjust gotta be there.

(1) Products Liability and Stream of Commerce

(a) Gray v. Am. Radiator (Ill. 1961). Abrogated by Worldwide Volkswagon. Womaninjured by a water heater explosion in IL. Illinois may exercise jurisdiction under its longarmstatute. Issue: Can Illinois constitutionally exercise personal jurisdiction over the foreigncorporations who manufactured the water heaters component parts in a products liabilityaction? Titan Valve Co, one of the Ds, sells valve to Pennsylvania company that isconstructed by someone else in PA that is later sold in IL. The company does not engage insales/solicitation in IL. Does this company have sufficient minimum contacts with the forum?Held, yes. Because it had reason to know there would be substantial use and consumptionof the valve in IL, minimum contacts standard is met.Rule:Foreseeable use in a stream of commerce test:If a corporation sells products,and it is foreseeable that theultimate use will occur in another state, the exercise ofjurisdiction doesnt offend traditional notions of justice and fair play. Irrelevant whatpercentage of your sales occur in the forum state, as long as the products use there isforeseeable.

(i) If forum & litigation, specific j will follow as long as connection b/t D & forum (evenif somewhat attenuated)

Under this test, availment of state law need not be purposeful, just foreseeable.

(b) Worldwide VW v. Woodson (SCOTUS 1980) p. 9. NY residents buy Volvo in NY.

Moving out to AZ, they get into a car accident in OK. Products liability suit against D fordesign defect. Worldwide WV is an intermediate distributor that does not do any business inOklahoma. Issue: Is Oklahomas longarm statute constitutional as applied to WW VW?Held, no. Although it was foreseeable that a car would be usedin OK, it was not foreseeablethat a sale would occur in OKand, in fact, none did.

Rule 1: Where an ultimate sale of a product actually occurs in the forum state, andsale in the forum state was foreseeable given the stream of commerce, a D hassufficient minimum contacts in the forum state to fulfill International Shoe.Rule 2: Profits alone do not constitute minimum contacts. Financial benefits

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accruing to the defendant from a collateral relation to the forum State will not supportjurisdiction if they do not stem from a constitutionally cognizable contact with that State.Rule 3:The minimum contacts test is a threshold test. Once minimum contacts have beenestablished, the exercise of jurisdiction must still be fair.

Policy:

(i) Individual concerns: Use may be entirely due to the unilateral action of the enduser; a defendant presumably has some control over where its product is ultimatelysold. D's should be able to control the breath of j they're exposed to.(ii) Federalism concern:States need contact before they can exercise power,regardless of fairness.

(c)Asahi Metal v. CA (SCOTUS, 1987). p. 15. Collision b/t motorcycle and tractoroccurred in CA. Motorcycle rider (Zurcher) sues motorcycle tire manufacturers underproducts liability claim in CA, including Cheng Shin, a Taiwanese manufacturer of theallegedly defective tube. Cheng Shin impleads Asahi, a Japanese manufacturer of the tube'svalve assembly who it contracted with in Tawian, for indemnification, then settles. No

connection between Asahi and CA/US besides the fact that it put its valve assemblies into astream of commerce that swept them into CA. Issue: Did CA have j over Asahi? Held, no(unanimous holding). Two-prong test. (1) is there minimum contacts? (2) is it fair toexercise minimum contacts? Plurality finds that no minimum contacts, applying thepurchase plus test. Brennan concurrence says it would fail second prong.Were there minimum contacts?

(i) Plurality applies the purchase plus test to find no."The purchase plus test:" (1)sale in the forum state must have been foreseeable AND (2) D must havepurposefully directed activity at the forum. The placement of a product intothe stream of commerce, without more, is not an act of the defendant purposefullydirected toward the forum state."takes marketing, advertising, or tailoring yourproduct to the needs of a forum. Yet to be adopted by a majority, so this rulehas no precedential power.

(ii) Stevens finds no. Test: Did D purposefully benefit from the laws of the forum stateby looking to volume, value, and hazardous character of components.No onebut Stevens buys this.(iii)Brennan finds yes on a foreseeable sale rationale.

Is the exercise of jurisdiction unfair, despite existence of minimum contacts? Yes.Regardless of how we establish minimum contacts, we need a balancing of

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interests test to determine fairness. Determination of the reasonableness of theexercise in j depends on:

(iv) Burden to D(v) Interests of the forum State(vi) P's interest in obtaining relief(vii) Interstate judicial sys's interest in efficient resolution

(viii) Interests of the several states in furthering certain policies.Here, burden to D severe. CA has no interest in dispute (about indemnification, not safetystandards). No reason why P couldn't sue in Taiwan. No interstate rationale for exercising j.

(2) Libel & Defamation(a) Generally: libel occurs wherever a libelous publication is sold/broadcast.

(b) Keeton v. Hustler (Rehnquist, 1984).P was girlfriend of a Penthouse publisher.Hustler said publisher gave her gonorrhea. Keeton sues Hustler for libel in NH, where issuesof Penthouse are sold. Issue: Is NHs long arm statute constitutional as applied here? Held,yes. (1) Hustler had sufficient minimum contacts with NH by distributing magazines there

to support specific jurisdiction. Where a publisher purposefully sells a publication in a forumstate, he has purposefully availed himself of the benefits of the jurisdictionso minimumcontacts established. (2) Additionally, does not offend traditional notions of fair play andjustice, despite the single publication rule (allowing it to hear all of petitioner's damagesfor libel in all states), an especially long statute of limitations, and the fact that P had noconnection with NH beyond the libel. Applying the factors laid out in WW VW

(i) NH has significant interest in redressing libel occurring in NH(ii) Citizens in NH suffer harm, too, by being misinformed(iii)There are good reasons for the single pub rule - interstate judicial system'sinterest in efficient resolution of contraversies.

The unfairness of New Hampshire law and a choice of law inquiry are a separate

question from jurisdiction.There is no requirement that P has min contacts with forum state in order to

justify the exercise of longarm j. P contact may enhance your argument for longarmjurisdiction, but lack of p contact will not defeat an argument for long arm j.

(c) Calder v. Jones (Rehnquist, 1984 - same day as Keeton). P is Shirley Jones, anactress. Enquirer publishes story about her constantly being drunk. Writer lives in NY, Jonesin CA. Issue: Does California have jurisdiction over the story writer? Held, yes. Acorporations sale of a publication in a forum state does not, in itself, create minimumcontacts between an employee and the forum. Because intentional harm is targeted, the

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writer should have known harm will be concentration in CA, as CA is the Ps residence andthe hub of entertainment. Individual is likely not subject to j anywhere magazine isrun in the same way that a corp d would be -- just in the place it is foreseeablethat the harm will be concentrated.

(d) Griffis v. Luban (Minn. 2002, cert denied). P resident of AL, D resident of MN. D

posts nasty things about P on archaeology online newsgroups. P files suit in AL. Issue: DoesAL have pers j.? Held, no. The harm must be specifically targetedat the forum state.Here, although D knew P lived in AL, did not know P would suffer the brunt of the harmin AL.

(i) Circuit split on this issue.(a) D always subject to j where P lives in intentional torts cases, as long asknow/have reason to know D resides there v.

(b) ) Ditto, plus D has reason to know harm will be concentrated in forum state.

(ii)Tightening of jurisdictional requirements can lead to a reduction in access tocourts but also reduces frivolous lawsuits.

(3) Contract

(a) Burger King Corp. v. Rudzewicz (SCOTUS 1985). P is Burger King Corp., FL corp.Franchisees open franchise in MI. Relationship goes sour. Longarm statute allows forpersonal j over breach of k claims where a k calls for performance in FL. Issue: Is FLlongarm statute constitutional as applied? Held, yes. Where you knowingly enter into acontract that will require an ongoing relationship with a corporation in anotherstate, you have minimum contacts with that state. Policy: Contact involved purposefulavailment; injury in forum state is foreseeable.

(i) Short term relations wont suffice.(ii)Where it seems fair to exercise jurisdiction, the minimum threshold for

minimum contacts may go down.(4) Domestic relations

(a) Kulko v. Superior Ct. (1978). Parties married in CA on one-day stopover. Reside in NY.Divorce, ex-wife moves to CA, dad sends kids to live with mom there. Issue: Is Californiaslong arm statute, which allows for personal jurisdiction in a resulting child support action,constitutional? Held, no. By moving to California, P unilaterally acted. Does not establishthat D has ties to CA. [Policy to ignore dads action by sending kids, to prevent discouragingparents from cooperating with one another]. Though failure to pay child support createssignificant effects in California, sig effects aloneare insufficient in domestic relationscontext.

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c) General jurisdictionGeneral jurisdiction

Defendant-Litigation-x-Forum----DefendantLine between forum and D is thick enough when:

D is a domiciliary

Corporate Ds

o Place of incorp is forumo Principle place of business is forum

o D does ongoing business in the forum that constitutes sufficiently substantial, continuous and systematiccontact

Are products ending up in the forum state? Are they targeting their products toward the forum state? Physical facilities in forum state? Employees in forum state? Purchase products in forum state?o How much? How often? How expensive? What % of corp.'s business does this count for?

o Where the contacts might be a little on the weak side, may still find general j if there is no other

reasonable forum.

(1) Domiciliaries SEE P. 36 for R2nd provisions(a) States have j over their own domiliciaries for absolutely any issue at all, so far aspersonal j goes under Constitution, provided the D receives sufficient notice. Milliken(SCOTUS 1940)(b)The forum state applies its own rules for determining whether a D is adomiciliary(c) Can only change your domicile by being physically present in a place and to have therequisite intention to stay. Until you change, your old domicile remains your domicile,regardless of whether youre in your domicile or not.

(2) Corporate defendants(a) D incorporated in forum state = general jurisdiction may constitutionally lie(b) Ds principle place of business is the forum state = general jurisdiction mayconstitutionally lie

(c) Where neither is true, go with balancing test Seinfeld said in class

(i) Perkins v. Benguet(SCOTUS 1951). P sues Filipino company, but the Phillipinesare under occupation. During the occupation, the CEO moved the corporationscenter of business to Ohio and temporarily began conducting the companys businessthere. No connection exists between OH and the litigation. Issue: Can Ohioconstitutionally exercise general jurisdiction over the D? Held, yes. Rule: Court has

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general j over a corporate defendant when there are sufficiently substantial,continuous and systematic contactbetween the D and the forum. Policy: Wherethe contacts might be a little on the weak side, may still find general j if there is noother reasonable forum.

(ii) Helicopteros Nacionales de Colombia v. Hall(SCOTUS 1984). Facts: Helicol,Colombian company, negotiated contract with Consorcio, Peruvian company, in Texas

for work in Peru. Helicol's other connection with TX: ordered helicopter parts; sentpilots to train there. Relatives of people killed in helicopter crash in Peru sue in Texas.Held, insufficient contacts for general jurisdiction.

(a) Negotiation of a single contract does not constitute systematic andcontinuous activities.

(b) Purchasing products in a forum does not constitute systematic andcontinuous activities.

(c) Sales in a forum mightestablish constitute systematic and continuousactivities, but here an insufficient level of sales

d) Tag jurisdiction(1) Schaffer- International Shoe is the standard for all exercises of jurisdiction over people andproperty. Abrogated by Burnham as it relates to jurisdiction in personam; still good lawvis--vis in rem & quasi-in-rem

(2) Burnham v. CA (1990). P attempts to file for divorce in CA against her NJ resident husband.She lives in CA, husband comes visit the kids/on a business trip. Serves him while he's in-state.Valid under longarm statute. Issue: Can CA constitutionally exercise personal j here? Held, yes.While International Shoe rendered personal service in the forum state unnecessary to exercisepersonal jurisdiction, personal service remains sufficient in at least most cases, though itremains s unsettled whether it is always sufficient. No single rationale. Tradition falls into

traditional notions of fair play by definition, v. tag j is foreseeable in most cases and generallysomeone is purposefully availing of benefits in forum state.

e) Ds consent

Consent can establish personal j in a forum (Szukhent).

Courts generally will give effect to forum selection clauses as a matter of contract law, unlessprima facie presumption of FSC enforceability is overcome. However, FSCs do not remove from courtsthe power to exercise personal jurisdiction under the due process clause.

o In determining whether prima facie enforceability is overcome, look to the context of the

contract to determine (1) does anything look out of the ordinary? (2) in a way that suggests

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bad faith? (Carnival)

(1) National Equipment v. Szukhent(SCOTUS 1964) p. 50. Ds leased farm equipment from P.Their contract designated Florence Weinberg as the Ds agent for service in New York, despite thefact that Flo had no contacts with D (but many contacts with P). Issue: was service onto Flosufficient to allow NY to exercise jurisdiction over D? Held, yes. Under the FRCP, Flo was a valid

agent for service. As a matter of due process, Ds consented to jurisdiction and received notice ofthe proceeding. "Parties to a contract may agree in advance to submit to jurisdiction of agiven court, to permit notice to be served by opposing party, or even to waive noticealtogether." Consent to jurisdiction is given a rebuttable presumption of validity.

(2) The Bremen (1972) p. 52. Forum selection clause in contract names London Ct. of Justice.Issue: Can FL court exercise jurisdiction when the oil rig crashes in FL waters & the parties sue oneanother? Held, probably not (remanded for further consideration). SCOTUS suggests FSC is likelyvalid. Absent some countervailing circumstance, we should enforce forum selectionclauses as a matter of k law. There is no reason why FSCs inherently contravene publicpolicy when their enforcement would render a court unable to hear a case.

May overcome the prima facie enforceability of FSCs by showing:(a) fraud, undue influence, or disproportionate bargaining power(b) such wild inconvenience as to show that it is intended to prevent lawsuit at all.(minor inconvenience not enough)(c)contravenes important public policy of the forum

(i) subjecting an entirelyUS dispute to a foreign forum may violate due process.

(3) Carnival Cruise v. Shute (1991) p. 55.Mr. Shute slips while on a Carnival Cruise, sues whenhe gets back to Washington. The ticket, however, contained a FSC for FL. Though Ninth Circuitheld the lack of free bargaining overcame the PF enforceability of the FSC, SCOTUS held forumselection clause was enforceable. Where an adhesion contract is to be expected under thecircumstances, the lack of arms-length bargaining is not a problem. In determining whetherprima facie enforceability is overcome, look to the context of the contract to determine(1) does anything look out of the ordinary? (2) in a way that suggests bad faith?Courtdid not find lack ofex ante notice as suggestive of bad faith.Policy: favor certainty for corporations over the ability to recover for a set of low-value claims.

(4) Restatement 2d of Conflicts 80, p. 59. FSCs dont divest a courts power to hear a case, butcourts should honor them unless they are unfair or unreasonable.

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(5) Uniform Law Commissioners Model Choice of Forum Act. Places more emphasis on the relativeconvenience of the parties. Otherwise, similar to Carnival.

f) Ps consent/waiver

(1) Phillips Petroleum v. Shutts (1985) p. 60. Class action lawsuit, where a class of Ps (whoare leasing land to D for energy production) are seeking interest that D earned on energy fees

placed in escrow. The named Ps bring the suit in Oklahoma, despite the fact that some absentplaintiffs are from Kansas. Issue: does Oklahoma have the right to determine the legal rights ofabsent plaintiffs who did not consent to the forum, but who did not opt out of the suit? [Ds havestanding to argue this because, if absent plaintiffs are not bound, it is disadvantaged] Rule: Psmust consent to jurisdiction, though failure to opt-out counts. Policy: Litigation sucksmore for Ds than Ps. Policy: Class action lit wouldn't work w/ opt in.

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B. In Rem and Quasi-in-RemMust pass International Shoe: Does D have sufficient minimum contacts with the forum, viewed in light of the scope of thelitigation? Stated differently, there must be minimum contacts under International Shoe among the defendant, litigation,and forum. (Shaffer)

Owning property in the forum alone may suffice, especially where the litigation is truly related to that property

Other contacts in addition to owning property may be necessary, especially where litigation is notreally about the

property but about using the property to satisfy a judgment on another matter.

Test applied:

Pure in remo real property always will pass;

o tangible personal property will almost always pass (unless brought into forum by unilateral action of a third

party);o intangible property will not pass without further contacts b/t D & forum.

Quasi-in-remo Court must have personal jurisdiction over the as a practical matter, as there is no connection between the

property and the litigation.

1. Pennoyer v. Neff. States inherently have the power to exercise in rem and quasi in rem jurisdiction; theyneed only provide Ds with adequate notice to fulfill due process requirements and properly attach. Whereowner is known and identified, you generally mustprovide actual notice; otherwise, service by publication maysuffice. Abrogated by Schaffer.

2. Harris v. Balk (SCOTUS 1906), p. 63. Harris owed Balk some money. Epstein sued Balk for money inMaryland; seized Harris debt to Balk by giving Harris a writ of attachment while Harris was in Maryland. Harrispaid Epstein, believing he had satisfied his debt. Balk then sued Epstein on the same debt, claiming Marylanddid not have jurisdiction over the debt in the prior case, so the debt had not been discharged. Issue: Was the

debt physically present in Maryland when Harris traveled there, so that the debt could be attached? Held, yes.Rule: Debtor carries around a debt on his shoulders. Debt is physically present in a forum state whenthe debtor is physically present there. Abrogated by Schaffer.

3. Shaffer v. Heitner (1977, p. 64). Shareholder derivative action. Shareholder of Greyhound sued Corp. +Greyhound officers for breach of fiduciary duty. DE establishes jurisdiction through quasi-in rem. Stocks are"physically present" in DE by state statute, which defines physical presence of a stock owned by a DE corp.Attach the stocks D's own. D must have minimum contacts with the forum under International Shoe,viewed in light of the scope of the litigation. Physical presence of a piece of property in the state may berelevant, but will not be dispositive, to showing connection with a forum state. Pure in rem cases will have a

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much easier time passing the bar, due to the clear relationship between the defendants contact to the forumstate and the litigation.

a) Case where pure in rem wouldnt pass Shaffer: I live in MI. Third party takes my diamond to FL. Bthinks she has claim on diamond. FL may not have j over me under Int'l Shoe.

C. Venue, Transfer & Forum Non Conveniens

First, is there personal jurisdiction in the forum state?Second, is venue proper in this particular district?Third, can a party apply for a change of venue to remedy any inconvenience? Or, can the litigation be dismissed on forumnon conveniens grounds? (Unclear where federal courts must apply state forum non conveniens law under Eerie. Commonto require waiver of SOL defenses.)

1. Venue: 28 USC 1391

a) Cases of diversity j, venue is proper:(1) Where any D resides if D's all in same state(2) Case substantially arises out of district

(3) If no district has venue under above, in any court where D subject to personal j.(4)This is a matter of federal law. Domicile for purposes of choice of law is a matter ofstate law.

b) Federal question/supplemental j.:(1) Where any D resides if D's all in same state(2) Case substantially arises out of district(3) If no district has venue under above, in any district where D can be found.(4) Any district, if D is an alien.

2. Transfer & forum non-conveniensTo transfer must:- remove to fed court (if not there already),

- apply to transferTransfer/forum non conveniens will be granted:-Where its convenient for parties & witnesses, and justice requires by looking to public/private interest factors-As long as the remedy isnt so lacking in the final destination as to make it nonexistent

a) FNC(1) This is a common law doctrine that provides an avenue to change where a case is heard,despite the fact that, where P filed, jurisdiction exists and venue is propert.

(2) Gulf Oil Corp. v. Gilbert (1947) p. 72. Explosion at issue in case and P all located in Virginia.P files suit in NY. D licensed to do business in NY, so personal j and venue is proper. Only reason Pfiles in NY is to avoid a VA jury, who might be adverse to large verdicts. Issue: Are federal courts

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permitted to dismiss cases on the basis of FNC, because there's no federal common law & nostatute saying they can do this? Is a federal court obligated to hear a case that falls into itsjurisdiction and venue is proper? Held, dismissed on FNC grounds, as doctrine of FNC exists atthe federal level. Policy: Promote convenience; prevent P's from exploiting the permissivevenue rules in a bad faith manner to "vex, harass, or oppress the D". Rule: Presumptionthat court will hear case, unless private or public interest factors strongly suggest court

shouldn't hear:(a) Private interest factors:(i) Ease of access to witnesses & evidence(ii) Availability of compulsory process(iii)Enforceability(iv) Inconvenience to the D

(b) Public interest factors(i) Choice of law(ii) Burden on court(iii)Local controversies should be decided locally.

(3) Piper Aircraft Co. v. Reyno. 454 U.S. 235 (1981) p. 76. Airplane crash in Scotland. All

surviving family members are Scots. Propellor makers & plane makers are in OH & PA.Administratrix of the estate is a secretary in CA. D removes to federal court. D moves for transferto middle district of PA under 1404(a). In middle district of PA, move to dismiss on grounds offorum non conveniens. Lower court concluded dismissal is appropriate, as foreign plaintiffs don'tdeserve the same presumption that the P's choice of forum should not be disturbed, weighingprivate interest and public interest factors. Issue: Is application of less favorable law a bar toforum non conveniens dismissal? Held, no. Less favorable law application does NOT act asan absolute bar to the forum non conveniens dismissal, especially for non-US plaintiffs.Courts should not be forced to engage in a difficult choice of law/substantive law analysis, whichwill prevent the streamlined application of law. However, where remedy in other forum is soinadequate that it is no remedy at all, application of law may affect a courts calculus.

(a) Forum non conveniens is about convenience to s, not substantive law.

b) Transferc) Statutory basis: federal

(1) 28 USC 1404: Court may transfer a case to any other court where j/venue lies (1) for theconvenience of the parties & witnesses and (2) in the interests of justice (may be done suasponte)

(2) 28 USC 1406: Court must dismiss for lack of venue/pers j. or, where its in the interestof justice, may transfer to a court where venue is proper. (must be done sua sponte)

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(3) 28 USC 1407: May consolidate mass torts into a consolidated pretrial proceeding, forthe convenience of the parties and witnesses and promotion of the just and efficientconduct of mass torts. (may be done sua sponte, discretionary)

d) Proposed statutory basis: state: Uniform Transfer of Litigation ActD. Foreign v. Domestic litigants

1. s choice of forum typically entitled to substantial deference but if is foreign, then choice of forum

entitled to less deference (Piper)a) Underlying instinct: protect Americans, not foreigners

b) When chooses to litigate outside home forum, then likely to be less convenient2. Foreign can more easily get dismissal for lack of personal jurisdiction b/c ofburden of litigating inforeign judicial system (Asahi)

a) s should not be forced to litigate in unfamiliar forums, unless they volunteer (e.g., Piperbrought forum non conveniens motion b/c Scottish law more favorable)

3. Comparison of treatment of foreign s and foreign s:

a) Rule inAsahi works to benefit of foreign s and rule in Piperworks to detriment of foreign s

b) ButAsahi involved foreign third party , so foreign s treated same in both cases

c) Ultimate result: less litigation involving foreign parties do not want U.S. to be magnet forforeign litigation

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II. Federal Subject Matter Jurisdiction

State courtsno SMJ requirement, unless specifically stated by statute.

Article 3(2) federal jurisdiction categories:

1. Fed question j.: arise out of the laws or constitution of the US2. Cases affecting Ambassadors, public ministers and consuls3. Admiralty & maritime4. US party to case5. Controversies between two or more States6. B/t State & citizen of another state7. Diversity j8. Certain types of land grants involving more than one state9. B/t State & another country

A. Federal Question: 1331

1. Policy justifications for exercise: uniformity, bias, expertise2. The constitutional standard

a) Osborn v. Bank of the US (1824) p. 83. Ohio invades the federal bank, takes money it claims thatit was owed in taxes from the Bank. The Bank claimed it was not subject to state taxation, sued toreclaim money in a conversion action, a state common law claim under Ohio law. Issue: Does this claimarise under federal law? Held, yes. The bank-enacting statute establishes federal jurisdiction in allcases involving the bank, so there is a statutory basis for the claim. The statute is constitutional, asfederal law forms an ingredient of cases related to the bank, as the bank itself is a creation offederal law. Constitutional box is huge; Congress must execute within it.

3. The statutory standard

On its face, s well-pled complaint must:o State a federal cause of action, or

o State a state cause of action with a federal question nested in it where:

o The state law cause of action necessarily raises a federal issue,

o The federal issue in hearing the claim is sufficiently strong, and

o Allowing federal jurisdiction will not radically alter the balance of federalism in a way that is out of proportion to

the federal issue at stake.

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a) 28 USC 1331. Federal question. The district courts shall have original jurisdiction of all civil actionsarising under the Constitution, laws, or treaties of the United States.

(1) No amount in controversy requirement(2) Despite using the same language, 1331 occupies a small portion of the constitutional box.

b) Louisville & Nashville RR Co. v. Mottley (SCOTUS, 1908) p. 86. Couple gets in accident on RR.

Settle by getting free lifetime RR passes. In 1907, RR stopped the passes of fed law that said RR can'tgive free transportation. Motleys sue to get their tickets in fed court, under a breach of contract claim.Does fed court have federal question j? Held, no. The well-pleaded complaint rule: Under 1331, splain statement of their cause of action (claim) must arise out of federal law, nots defense.

(1) Little rationale for treating s federal issues differently than s beyond docket control.

c) Am. Well Works co. v. Layne & Bowler (1916, p. 87). P manufactures a pump. D was runningaround and saying "guess what potential purchasers, we have a patent in this pump, P has beeninfringing our patent." P sues. Cause of action is the claim of tortious interference for business understate common law. D removed to federal court, claiming that the validity of the patent is determined byfederal law, and there is no way state court can litigate this claim without a determination on

the federal patent law question. If P was infringing patent, no liability. Did D have patent and Did Pinfringe are threshold questions, and federal law. Issue: Does this case arise under federal law? Held, no.While questions of patent law are central to this litigation, "a suit arises under the law that creates thecause of action." For a suit to arise under federal law, the cause of action must be federal.Narrowed by Smith: this is a sufficient, but not necessary, basis for federal j.

d) Smith v. Kansas City Title & Trust (1921, p. 88). Nesting jurisdiction.P is a shareholder in aMO trust. Sues under state shareholder statute to enjoin trust from investing in bonds issued by fedgov't (via the dreaded national bank), on the basis that the federal bank is unconstitutional. Underlyinglegal theory: fed bank is unconstitutional. Issue: Does this case arise under federal law? Held, yes.Where the P's bill demonstrates that his rights to relief depend on the construction or application

of federal law or the constitution, a case arises under fed law,even if the federal lawquestion is nested within a state law claim. Narrowedby Merrell Dow.

e) Merrell Dow Pharma v. Thompson (1986). Bendictin case. P claimed negligence, breach ofwarranty, "negligence per se" on the basis of FDA regulations, despite the fact the FDA regulations didnot create a private right of action. Issue: does federal question jurisdiction lie? Held, no. NoCongressional intent to create a federal cause of action-- no private cause of action when they draftedthe law (neither implied nor explicit). Nested federal issue may be the basis for federal question

jurisdiction,but only if the nested federal issue has a private cause of action attached to it.

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(1) Critique by Brennan: Lack of right to a remedy does not equate with lack of jurisdiction; cantinfer Congressional intent from lack of action

(2) Nesting under Merrelldoesnt help s any more than a federal cause of action would. Onlyhelps s because they can remove when s want to stay in state court but s want to sue infed court.

f) Grable & Sons v. Darue (2005, SCOTUS) p. 93. P files to quiet title, a state cause of action.Dbought property at an auction following a federal tax foreclosure. P claims foreclosure was invalid, dueto insufficient service. There is no private federal cause of action to challenge a tax sale. Issue: Does thisquiet title action arise out of federal law? Held, yes. A private federal cause of action is not a key, it isonly a welcome mat. It is one factor in determining whether nesting j will lie:

(1)Does the state law cause of action necessarily raise the federal issue?(2)Is the federal interest in hearing the claim sufficiently strong?

(a)The creation of a private right of action generally indicates it is.(b)Where no radical alteration would occur, this threshold is lower.

(3)Will allowing federal jurisdiction radically alter the state/federal court balancePolicy: [A] request to exercise federal-question jurisdiction over a state action calls for a common-

sense accommodation of judgment to [the] kaleidoscopic situations that present a federal issue, in aselective process which picks the substantial causes out of the web and lays the other ones aside.

B. Diversity

1332. Diversity of citizenship; amount in controversy; costs(a) The district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum orvalue of$75,000, exclusive of interest and costs, and is between--

(1) citizens of different States;(2) citizens of a State and citizens or subjects of a foreign state;(3) citizens of different States and in which citizens or subjects of a foreign state are additional parties; and(4) a foreign state, defined in section 1603(a) of this title, as plaintiffand citizens of a State or of different States.

For the purposes of this section, section 1335, and section 1441, an alien admitted to the United States for permanentresidence shall be deemed a citizen of the State in which such alien is domiciled.(b) Except when express provision therefor is otherwise made in a statute of the United States, where the plaintiff who filesthe case originally in the Federal courts is finally adjudged to be entitled to recover less than the sum or value of$75,000,computed without regard to any setoff or counterclaim to which the defendant may be adjudged to be entitled, andexclusive of interest and costs, the district court may deny costs to the plaintiff and, in addition, may impose costs on theplaintiff.(c) For the purposes of this section and section 1441 of this title--

(1) a corporation shall be deemed to be a citizen of any State by which it has been incorporated and of the Statewhere it has its principal place of business, except that in any direct action against the insurer of a policy or contract

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of liability insurance, whether incorporated or unincorporated, to which action the insured is not joined as a party-defendant, such insurer shall be deemed a citizen of the State of which the insured is a citizen, as well as of any Stateby which the insurer has been incorporated and of the State where it has its principal place of business; and(2) the legal representative of the estate of a decedent shall be deemed to be a citizen only of the same State as thedecedent, and the legal representative of an infant or incompetent shall be deemed to be a citizen only of the sameState as the infant or incompetent.

(e) The word States, as used in this section, includes the Territories, the District of Columbia, and the Commonwealth ofPuerto Rico.

1. Differences between 1332 and constitutiona) Amount in controversy requirement (efficiency)b) Complete diversity requirement (your interests will otherwise be protected by in-staters interest)

Statutory box is smaller than constitutional box.

2. Complete diversity requirement of 1332(a)(1)

a) Strawbridge v. Curtiss (1806) p. 98. P's are all from Mass. D's are all from Mass but one from VT.Diversity? Held, no. As a statutory matter, diversity must be complete (all p's must not haveoverlap w/ any d's).

b) How do you determine who is a citizen of a state? Domicil requirements are on p. 36Mas v. Perry (1974) p. 98. Mr & Mrs. Mas are grad students at LSU. Mrs. Mas originally fromMississippi and Mr. Mas from Paris. Mr. Perry was their landlord, who set up two-way mirrors in bedroom& watched the married couple. Asserted basis for j is diversity. Perry is from Louisiana. To be citizenof a state, a person must (1) be US citizen or greencard holder and (2) domiciliary of aparticular state.To be a domiciliary in a state, you need to (1) physically be there when youestablish it as your domicile and (2) intend to remain, at least for a while. Here:

(1) Mr. Mas is originally from France. Did not intend to stay in Louisiana beyond grad school, so heremained a citizen of France at the time of the suit for the purposes of 1331.

(2) Mrs. Mas is originally from MS. Did not intend to stay in Louisiana beyond grad school. Awoman does not automatically become a domiciliary of her husbands domicile for thepurposes of 1331 where her husband is a foreigner, as that would deprive US of

jurisdictionover her. She remained a citizen of MS for the purposes of 1331 at the time of thelawsuit.

(3)The couples moving to IL after the lawsuit was filed has no effect under 1331. The relevantcitizenship/domicile under 1331 is the parties domicile at the time of filing or removal,not the parties domicile at the time of the underlying events. Post-filing changes to

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domicile will not destroy diversity; similarly, lack of diversity at the time of the event does notpreclude smj if the party moves before filing.

c) What if one person is not a U.S. citizen or greencard holder? Establish SMJ under 1331(a)(2) instead of1331(a)(2). Mas v. Perry.

(1) Amount in controversy requirement still applies

d) No manufacturing of jurisdiction by collusion or selling claims: 28 USC 1359(1) Statute text: Parties collusively joined or made: A district court shall not have jurisdiction of acivil action in which any party, by assignment or otherwise, has been improperly or collusivelymade or joined to invoke the jurisdiction of such court.

(2) Kramer v. Carribbean Mills (1969) p. 100. Panama sold claim to Kramer for $1; Kramerstated that they would pay Panama 95% of their recovery solely as a bonus. Issue: does thisconstitute improperly or collusively made diversity? Held, yes. Look at the circumstances todetermine wheterh the assignment is solely for collection purposes. If the new claim holder getswhat looks like a collection fee, it violates 1359. Policy: Assigning claims merely to givejurisdiction undermines core purposes of diversity and skews federalism, as anything could be

federalized if you wanted to.

e) Alternative statutory bases for diversity jurisdiction applying to specific types of cases

These do not require complete diversity!

(1) Multiparty, Multiforum Trial Jurisdiction Act of 2002 (p. 102): Mass torts cases need only haveminimal diversity. 75 people must have died in accident. Look to the statute for details.

(2) Class action fairness act of 2005. Class actions where amount in controversity is >5mmrequire only minimal diversity.

3. Amount in controversy requirement of 1332

a) is the master of her own complaint. Should she claim for $1 under amount in controversyrequirement, may not remove.b) Aggregation rules

(1) If 2 s have a separate claim for 38k each, can never aggregate. If one 75, one 5 of canpiggyback.Allapatah

(2) If has claim against 2 separate s for 38k each, cannot aggregate (if joined by FRCPmechanism).Allapatah.

(3) But, if a single has two entirely unrelated claims against same s, they can beaggregated even where neither is above 75.

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c) Amount in controversy need not have an actual worth of 75k. must have a good faith belief atthe time of filingthat amount in controversy requirement is met.

(1) St. Paul v. Red Cab. (SCOTUS, 1938) p. 103. In state court, P sued for an amount over thefederal amount in controversy requirement. D removed on the basis of diversity. After removal, Psubmitted document accounting for damages, which showed that the claim was worth less than

the amt-in-controversy req. Issue: did federal court properly continue to hear the case? Held, yes. had a good-faith belief that the claim exceeded 3k at the time of removal.Clearly, was not exceeding the value of his claim at the time of filing to meet amt-in-con req. because hedid not file in fed. court.

d) For dismissal, must show by POE that the value of the claim does not exceed 75k as amatter of legal certainty.

4. Policy considerations for and against diversity jurisdictiona) Bias rationale may still hold water, and federal courts have nonelected juries and larger jury poolsb) Avoid forum shopping/tort magnet jurisdictions

c) BUT, no real evidence of biasd) Could amend 1332 to say that businesses are residents of all states where licensed to do business,which would reduce diversity

C. Supplemental JurisdictionThreshold question: Do you have both:Claim that on its own is unquestionably eligible for federal jurisdiction?Claim that on its own in unquestionably ineligible for federal j?

1. Adding additional s and additional claims

a) Pendent & Ancillary Jurisdiction: the old rulePendent jurisdictionSame , same . just has multiple claims against (some state, some fed):

--claim 1 (federal question)1 }} Federal jurisdiction over both?

--claim 2 (state question) 1}

Ancillary jurisdictionSame has claims against multiple s:

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--claim 1 (state question) 1}} Federal jurisdiction over both?

--claim 2 (state question)2 }

b) Rule prior to 1966: Hurn. Supplemental jurisdiction lies when the federal and state claims are

actually a single cause of action. Unworkable, because what constitutes a cause of action ismetaphysical nonsense. Overturned in Gibbs post-FRCP.

c) United Mine Workers v. Gibbs (1966) p. 110. Gibbs claims that UMW prevented him fromworking at a coal company in NJ. Mine to be worked by workers from a different union. Files in EDTenn on federal labor law and state conspiracy claims. Issue: did the district court have SMJ overthe state law claim? Held, yes.

(1) Constitutional authority: Congress may authorize federal jurisdiction where (1)there is a claim based on federal law and (2) the federal claim and the state claimare sufficiently interrelated to constitute a single case.(2) Statutory authority: Under 1331s language granting jurisdiction over all civil actions

involving federal question, Congress has authorized pendent jurisdiction whenstate andfederal claims arise from a common nucleus of operative fact, but courts may, in theirdiscretion, choose whether or not to exercise pendent jurisdiction.

Policy: efficiency in resolving claims; consistency in factual determination; avoid unnecessarilycutting off P's from multiple avenues of relief; not force P to forgo federal court because she cantafford to litigate 2 cases.Factors counseling the exercise of pendent j:

(3) Judicial economy, convenience, and fairness to litigants(4) State claim is closely tied to questions of federal policy

Factors against:(5) Jury confusion would result from hearing the two separate legal theories together(6) Would necessitate deciding a novel question of state law(7) Federal claims later dismissed (can happen any time)(8) Whenever it appears that a state claim constitutes the real body of the case, to whichthe federal claim is only an appendage.

Still mostly good lawembodied in 1367, except that jurisdiction is not technicallydiscretionary.

d) Owen v. Kroger. Diversity case. Kroger's husband (IA) killed by crane when working for OPPD(NE) who then impleads Owen(initially thought NE, turns out IA), the operator of crane, Owen.

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Kroger amends complaint and names Owen as D. All claims are based on state law, and bothcases arise from a common nucleus of fact. Issue: Does supplemental j lie? Held, no. In a casewhere federal smj is based on diversity, ancillary jurisdiction will not lie where itdestroys complete diversity. Congress intended complete diversity under 1332; to allowsupplemental jurisdiction would do violence to the underlying basis for jurisdiction in theunderlying case.

(1) Bias is not a concern(2) NB: Where 1 impleads 2 and has no claim against 2, no dismissal.

Still good law.

e) Finley v. US (1989) p. 115. Finley gets into airplane crash because he hit an allegedlynegligently-placed power line. Finley has a case against two separate defendants: a state lawclaim for negligence against the local power company, and a claim under the federal tort claimsact against the Federal Aviation Administration.

---fed claim-1 common nucleus of

operative fact

---state claim2 (no diversity)Issue: does supplemental jurisdiction lie against 2? Held, no, as a matter of statutoryinterpretation. Absent direction from Congress, Supreme Court will not interpret claimsagainst two different parties to be a single civil action under 1331 absent directionfrom Congress.Abrogated by 1367.Policy:To decide otherwise would subject 2 to federaljurisdiction that would otherwise be absent.

Alternative way Finley couldve been decided: (1) The common nucleus of operative fact meansthis is a single civil action, (2) adding the claim does no violence to the original reason forexercising jurisdiction, so supplemental jurisdiction will lie.

2. Current statutory ruleWhat matters is the predicate for the supplemental j: fed question has a big enough coattail for anyother dispute arising out of a common nucleus of operative fact, whereas diversity will not support asupplemental claim where diversity is destroyed.

1367. Supplemental jurisdiction.(a) Except as provided in subsections (b) and (c) or as expressly provided otherwise by Federalstatute, in any civil action of which the district courts have original jurisdiction, the district courtsshall have supplemental jurisdiction over all other claims that are so related to claims in theaction within such original jurisdiction that they form part of the same case or

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controversy under Article III of the United States Constitution [codifies Gibbs]. Suchsupplemental jurisdiction shall include claims that involve the joinder or intervention ofadditional parties [Overrules Finleydiversity j is only exception, not multiple parties].

(b) In any civil action of which the district courts have original jurisdiction founded solely onsection 1332 [diversity] of this title, the district courts shall not have supplemental jurisdictionunder subsection (a) over claims by plaintiffs against persons made parties under Rule 14, 19, 20,or 24 of the Federal Rules of Civil Procedure, or over claims by persons proposed to be joined asplaintiffs under Rule 19 of such rules, or seeking to intervene as plaintiffs under Rule 24 of suchrules, when exercising supplemental jurisdiction over such claims would be inconsistent with thejurisdictional requirements of section 1332 [codifies Owen].

(c) The district courts may decline to exercise supplemental jurisdiction over a claim undersubsection (a) if--(1) the claim raises a novel or complex issue of State law, (2) the claimsubstantially predominates over the claim or claims over which the district court has originaljurisdiction, (3) the district court has dismissed all claims over which it has original jurisdiction, or(4) in exceptional circumstances, there are other compelling reasons for declining jurisdiction.

[codifies Gibbs somewhat, but no longer a rule of pure judicial discretion? But, as apractical matter can do whenever want to.]

(d) The period of limitations for any claim asserted under subsection (a), and for any other claimin the same action that is voluntarily dismissed at the same time as or after the dismissal of theclaim under subsection (a), shall be tolled while the claim is pending and for a period of 30 daysafter it is dismissed unless State law provides for a longer tolling period.

(e) As used in this section, the term State includes the District of Columbia, the Commonwealthof Puerto Rico, and any territory or possession of the United States.

3. Adding additional s: supplemental jurisdiction and the amount in controversy requirementa) The old rule, pre 1367

(1) Clark v. Paul Gray (1939) p. 117. Group of businesses join together to enjoin a federal law.(Decided at a time when the fed question statute had an amount in contraversy requirement.)One P, Paul Gray Inc., met amount in controversy req. Can other P's piggyback on Paul Gray? Theydo not meet amount in controversy, but share a common nucleus of operative fact. Held, no j overnon-Paul Gray D's. Each P must meet amount in controversy requirement, unless theyshare common interest or title (for example, joint owners of a single piece of land).

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(2)Zahn v. Int'l Paper Co. (SCOTUS 1973). p. 118. NY Company polluted a river. P's haveland that abuts the lake into which the river flowed. Sue as a class, arguing that pollutiondiminished property values. As a class, they meet the amount in controversy requirement; nameds meet amount in controversy requirement; non-named class members do not. Insufficient toallow supplemental jurisdiction over the non-named s. Despite Congresss authorization of classaction suits under the FRCP, one P may not ride in on another's coattails.

(a) Privileges Congress desire for docket control by including only high-value claim in 1332over Congress desire to allow low-value claims to move forward under the class-action rulesof the FRCP.

b) New rule, post 1367:Exxon v. Allapattah (2005). Two separate cases aggregated. Case 1: Exxon stations suing parent coabout overcharging for gas in a class action suit. Case 2: Girl cuts finger on tuna can. She has 75k claim;parents do not. Where the other elements of jurisdiction are present and at least one named plaintiff[when joined any other way besides Rule 19 (compulsory joinder) or Rule 24 (acting as anintervenor)] in the action satisfies the amount-in-controversy requirement, 1367 doesauthorize supplemental jurisdiction over the claims of other plaintiffs in the same Article III

case or controversy.(1) Is there a civil action over which district court has original jurisdiction?

(a) If no single P meets amount in controversy, no smj(2) If smj is predicated on federal question, analysis ends.(3) If smj is predicated on diversity, who is being joined, a or a ?

(a) If a , cant be joined via FRCP 14, 19, 20, or 24 unless (1) amount in controversyrequirement is met and (2) complete diversity remains

(b) If a , cant be joined via FRCP 19 or 24 unless (1) amount in controversy requirement ismet and (2) complete diversity remains

(c) Although 1367(b) does not speak to the complete diversity requirement for s joinedthrough means other than rule 19 or 24,Allapattah suggests that to do so would

contaminate the original jurisdiction under 1367(a).4. Class action rules: only non-named parties may not meet complete diversity

D. Removal Jurisdiction

1. 28 USC 1441.a) D may remove (P cannot)

(1) To the district court that embraces the state judicial district(2) Any action for which a district court has original jurisdiction(3) As long as all Ds agree [from treatise, not law text]

b) Additional requirements

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(1) For federal question: none(2) For diversity: D cannot remove where any D is a resident of the forum state

c) Supplemental jurisdiction(1) If fed claim joined with state claim, may remove whole thing

d) When a foreign state is D, can remove at basically any time2. 28 USC 1445: cant remove where D is RR; D is carrier; action involves workmans comp.3. 28 USC 1446

a) Remove by filing a notice of removal with a short and plain statement of grounds for removalb) can remove within 30 days of getting information via pleading that case is removable, as long asits within one year of commencement of action.

4. 28 USC 1453: Class actions can be removed to fed court based on diversity regardless of citizenship of Ds,as long as all Ds consent.

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III. Choice of Law Among the StatesOverall policy:

- States have an interest in applying their own law, but want some form of system of comity where their own law willapply in different forums where it really matters: game theory

- Individuals have an interest in knowing what law will apply: foreseeabilityA. Vested rights and territoriality: the first restatement approach

1. Basic idea: the laws of a state attach to a legal occurrence at the moment it occurs. States are obligated torecognize these rights and enforce them.

a) State may choose to not enforce a right where something in the mechanism of the enforcement itselfwould be illegal in the forum state. Beale 49

b) Remedy, however, may be chosen by the forum state. Beale 52 p.136c) Policy: foreseeability to parties; fits into then-prevailing conceptions of state sovereignty (territorial)

2. Approach applieda) Torts

(1)Alabama Great Southern RR v. Carrol. p. 136. One employee injured by another.Everyone is from AL & employment relationship arose in AL, but accident happened in MS. Conflictof law: AL allows employer liability for fellow servants, MS does not. Issue: Which law applies?

Held, MS law applies. Lex locus delecti governs choice of law in tort actions. The rightvests where the injury occurs because this is the last event necessary to create the tort.(2) R1st 377: Tort occurs where the last event necessary to make an actor liable for an allegedwrong takes place.

(a) Special rules for poisoning (where you administer the poison) and defamatory statement(place where statement communicated)

(3) The background tort rules, such as what mental state is required for liability, whether CN is adefense, and the fellow servant rule, are determined by the law of the state where the rightvested.

b) Contract(1) Validity of the underlying contract.

(a) Milliken v. Pratt. Facts: Pratt was a married woman who entered into a k with Pratt, asupplier, providing guarantee for husband so that he would be extended a line of credit ongoods they sold him to stock his store. Pratt mailed Milliken her guarantee with hersignature from Massachusetts; Milliken then signed the k in Maine. Husband defaults on lineof credit. She refuses to pay, despite guarantee. Pratt sues in Massachusetts. Conflict oflaw: Mass at the time of contract did not allow married woman to enter into contract.Maine did not have this rule. Issue: Which law applies? Validity of contract is to bedetermined by the state where the k was made.

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(i) In cases involving a unilateral contract, the contract is made whenofferee accepts the contract via performance(ii)In cases involving a bilateral contact, the contract is made when offereeindicates assent.

Here, contract was unilateral. Pratts letter of credit was an offer that Milliken accepted viaperformance, so the contract was made in Maine. Pratt is liable.Policy problem: many contracts can be classified as either unilateral or bilateral, sojudicial discretion actually is playing a role in how/when/where the right vests. As here,courts may decide just outcome and then categorize the contract accordingly.

(b) R1st 311 comment d. States to look to the general law of Contract, rather thanforum law, to determine where the principal event necessary for contract formationoccurred.

(c) R1st 314. Where acceptance sent by mail, common carrier, or over a phone k forms atplace of sending.

(d) R1st 326. Where acceptance to a bilateral contract is sent via an agent of acceptor orby telegraph, k forms at the place of delivery.

(2) Breach of contract

(a) 358: Whether breach of contract occurred will be determined by the laws ofthe state where the contract was/was to be performed.

c) PropertyRestatement provisions on p. 144

(1) General rule: Property rights in a tangible thing vest in the state where the propertyphysically was when the interest was created.

(2) With real property, the law of the state where the property is controls. Still good law.(3) With chattels, generally where the chattel was when the right at issue was created, butspecial rules where the chattel is embodied in a document or when chattels are willed.

d) Private corporations

(1) McDermott Inc. v. Lewis. Stockholder suit. P wanted to enjoin or rescind reorganization ofcorp. Corporation was incorporated in Panama, but this subsidiary was primarily operating inDelaware. Conflict of law: Panama would allow reorganization; DE law would not. Issue: DoesPanamanian or DE law apply? Panamanian law applies. Law of the place of incorporationgoverns its internal affairs. Still good law.

(a) Exception: States may restrict limited liability for directors, agents, and shareholders asa condition of doing business in the state.

(b) Parties choose to incorp in a place precisely because they like the menu of legal rules,and this is a rule where line drawing actually is possible.

3. Escape deviceso Procedural/substance characterization

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o Switch a tort into a k by saying it creates an implied contractual condition

o Switch a k into property by saying its about the underlying issue in the contract

o Depecage

o Revoi

o Penal exception

o Public policy

o Characterization as a particular type of law

a) Characterizing a fuzzy case as one type of case (ie, tort v. contract) based on the outcome the courtwants

(1) Burr v. Beckler (1914) p. 143. P loaned money to Edna Toby-Beckler pursuant to a loanagreement that was secured by property in IL. Toby-Beckler signed the loan agreement while shewas in Florida and mailed it from there. Toby-Beckler defaults on the loan, and Burr sues in IL toforeclose. If this is a property case, IL law would apply. However, court characterizes it as acontracts case. Courts silently exercise discretion in choosing how to characterize a case.Here, court likely did so because the Toby-Beckler was allegedly defrauded by her ex-husband inthe creation of the loan. Conflict of law: if contract was made in FL, then loan was invalid

(women cannot enter into contracts in FL-coverture). If IL law applies, loan was valid. Held,contract was made at mailing, so Florida law applies.

(2) Levvy v. Daniels (Conn. 1928), CP 160-161: is injured in MA as passenger of rental car thatwas rented in Conn.

(a) Conn: where contract made (strict liability for car rental company so easier to suecompany)(b) MA: where accident occurred (harder to sue car rental company)

(c) Holding: Conn. law applies b/c court characterized it as a contract case instead oftort case, as the tort law effectively inserts an implied condition into all rental carecontracts.

b) Depecage (dismemberment)(1) Involves applying different states laws to different parts of a claim.

(a) Haumschild v. Continental Casualty (p. 151). Conflict of law: Interspousalimmunity in CA, no interspousal immunity in WI. Wife wants to sue husband over a caraccident that occurred in CA, but they had been married and were domiciled in WI. Court:

(i) Applies lex loci delicti to say that whether negligence occurred is a matter of CAlaw.

(ii) Applies depecage to say that whether spousal immunity applies is a matter of WI.Choice of law rule in re: familial status is determined by the law of the place wherethe parties were married.

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c) Characterizing other states laws as procedural.This area of law still has bite.Rule: Forum state may always apply their own rules of procedure; it must, however, apply the substantive rules dictated bychoice of law.Application:

o Statutes of limitations: Is their a borrowing statute? If not, state could choose to apply own SOL.

o Statutes of repose: Apply any time after action, regardless of injury. Always substantive

(1) Procedural rules are generally not thought of as outcome-determinative, though they often areas a practical matter.

(2) Grant v McAuliffe (CA 1953) p. 153. Car accident in Arizona, California residents. D dies.P's (Ds decedents) sue in CA. Conflict of law. AZ law: Tort action for neg doesn't survive deathof tortfeasor. CA law: Tort action survives death. Because this is a tort action, lex locus delectiwould mandate application of any Arizona substantive rules. Issue: is this a procedural rule or asubsantive rule? Held, procedural. While there is no single definition of substance or procedure,this is procedural because it isabout enforcement and the scope of remedy, not about anunderlying right.Procedural rule defines process by which case is brought and decided, not the

s right to a remedy. Here, survival statutes do not create a new cause of action (no longergood law), so they are more akin to SOLs.

(a) Critique:(i) Definition here would provide that every law that does not provide a new cause ofaction is procedural.

(ii)These laws have a dual purpose they are designed to promote courtroomefficiency, but they are also designed to restrict s rights.

(3) Boernalis. P did not receive additional pay as required by Panamanian Labor Code, but SOLbarred recovery in Panama. P sues in NY. Issue: Are statutes of limitation procedural orsubstantive? Held, procedural. While the court here determined SOLs are procedural,the dualpurpose of statutes of limitations(to give Ds repose by restricting Ps causes of ac tion,

and to promote judicial efficency by not clogging the courts)means that different jurisdictionsreasonably disagree on the issue.

d) Revoi: looking at foreign states choice-of-law rules to decide which law to apply(1) Court can decide to accept renvoi: when other jurisdictions COL rules say to apply forumlaw, then do it (American Motorists Insurance v. Artra Group)

(2) Court can decide to decline renvoi: ignore choice of law in other jurisdiction (Haumschild)(3) Problem: circular

(4) Rest. 1st 7: COL rules of forum should be applied exceptions are questions of title to landand divorce

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(5)American Motorists Insurance v. Artra (1995). Limited renvoi exception adopted allows MDcourts to apply MD law when that jurisdiction's CoL rules would apply MD law. MD courts shouldapply MD substantive law to K entered into in foreign states' jurisdictions in spite of the doctrine oflexi loci when:

(a) MD has the most significant relationship to the K issue presented (or substantial)(b) State where K was entered into would not apply its own substantive law, but would applyMD law

Current state of law: States may choose to accept renvoi when:(c)The forum state has, at a minimum, a substantial relationship to the contractat issue(d) Their COL rules refer them to a state who would apply the forum states ownCOL rules

This will result in the application of the forum states substantive law.e) The Penal Exception

(1) Loucks v. Standard Oil (1918) p. 160. Common law: courts do not enforce the penallaw of another states. Generally applies to crim case, but civil laws can also have penalcomponents to them. Measure of fine to be about culpability of D, not harm to P. Issue: is this

rule penal in nature? Held, noeven when damages are punitive in nature, they may becharacterized as non-penal where money is also used for reparation to family of victim.Discretionary determination.

f) Public policy exception: forum may decline to enforce foreign laws that offend its deeply held publicpolicy

(1) Loucks v. Standard Oil (N.Y. 1918), CP 170-72: MA law allows for really high recovery. Cardozoconcludes that MA law is not in tension with NY public policy. Key: mere presence ofdisagreement b/t forum law and foreign law insufficient to support application of public policyexception. Must be able to demonstrate that issue is fundamental or very important.(2) Based on language in Loucks, this is open season.

4. Critiques of the vested rights approach.

a) Arbitrary -- focus on narrow factors without justification for why those particular factors should bedeterminative.b) Can't deliver on good it purports to provide, that is, foreseeability, because you can't always saywhere tort occurred, where k made without imposing string of more and more arbitrary cut offs.c) All rests on vested rights, which doesn't square with modern conceptions of judicial discretion.d) Escape devices lead to lack of predictability and unpalatable precedents in the name of good policy.e) Avoids asking substantive questions about the intended reach of the law.

B. Between R1st and R2d1. Center of Gravity Approach

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a) Auten v. Auten (NY 1954). Facts: British husband and wife get divorced after husband runs off toNY. Wife follows him to NY to get him to sign a separation agreement, whereby he agrees to pay her andtheir children a monthly sum. When husband failed to make payments, wife brought separation suit inEngland. The case never went to trial, and wife brought suit in NY years later. Issue: Did the suit inBritain repudiate the NY separation agreement? Conflict of laws: English bringing original suit doesntdefeat enforceability of separation agreement. NY law bringing original suit does defeat enforceability.Rule: To determine which law to apply, use the center of gravity approach and determine whichjurisdiction has the most significant contacts with the matter in dispute. Which jurisdiction has themost significant contacts to the dispute?Held,British law applies. The center of gravity servesas a proxy for 1) which state has the most interest in the application of its laws and 2) theintent of the parties, instead of applying the law of a forum whose connection to the disputeis fortuitous. Here, everyone was from there, wife only came to NY to follow husband, but wife andkids were going back to England. England would be responsible for welfare if wife isnt supported. Wifesurely thought English law would apply.

b) Haag v. Barnes (NY 1961). Facts: P, a NY resident, had a child out of wedlock with D, an Illinoisresident. She had the child in IL, under his request, and signed a K that he would give $ to the child in

exchange for a bar against future actions taken against him. The K said IL law would apply. However, shefiled a complaint against him in NY seeking more $. P lives in NY with the child. Conflict of laws: IL the Kis a bar to future actions. NY the K is not a bar to future actions. Holding: Applying center of gravityapproach, IL law applies b/c thats what parties clearly intended, child was born in IL, husband from IL,husbands place of business is in IL, people made to act as agents are in IL (whereas this didnt matter inAuten), payments being made from IL. Also, doesnt contravene public policy b/c the child is gettingmore than enough $. The fact that child and mother are in NY is not relevant (in contrast to Auten where this was super important). Held, IL is center of gravity.

c) Seems like court is still applying rough justice Barnes was paying, so we dont need the case to goforward, whereas Auten was not.

2. Interest Analysis

Always ask:What are the conflicting laws?What are the underlying policies of these laws?Does the state have an interest in applying its law on these facts, i.e., does application of one of the laws benefit or harmstates domiciliaries?

What state law do the parties want applied?Loss allocating v. conduct regulating? Boy Scouts

a) New York & NeuimeierFor loss-allocating rules:

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where false conflict of state interest (codomiciliaries), go with codomicile

where true conflict of state interest (split domicile, each trying to apply own law), apply lex locus delicti

where no state interest exists (split domicile, each trying to apply other law), usuallyapply lex locus delicti

For conduct-regulating rules, generally apply lex locus delecti

(1) Early cases(a)Rule: Where co-domiciliaries are from the forum state, apply forum law.(b) Babcock v. Jackson (NY 1963) applied NY law.Facts: P was a guest in Ds car. P and D NY residents. They drove to Canada where therewas an accident and P was injured. P sued in NY for negligence. Conflict of Law: Ontario hasguest statute, NY does not. Issue: Which law applies? Applying a center of gravityapproach, but looking more to NYs interest, applies NY law.

(i) Expectation of the parties: the driver and guest left NY knowing their rights andrelationship cant change when you go over state lines.(ii) Interests of the states:

(a) Ontario: to protect Ontario insurance cos against fraud. Not at issue here.

(b) NY has no guest statute b/c NY wants to compensate tort victims fromstate of NY, regardless of where they are injured

(c) After first cases, it became apparent that either (1) the seat of the parties relationshipor (2) the state interest would be the dispositive factor.

(i) Dym is the outlier, rather than Tooker.

Accident Co-domicile To/From Seat of Relationship Law?Measures Lex locus

delectiState interest (lossallocation, convenienceto ct., responsibility totaxpayers)

Expectation ofParties

Expectation of theparties

Summary Not dispositivefactor

Dispositive factor,minus Dym

Not dispositivefactor

Dispositive factor,minus Tooker

Babcockp.174

ON NY NY NY NY

Dym p. 177 CO NY CO CO (met there, ratherthan NY)

CO

Maceyp.177

ON NY ON NY NY

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Tooker MI NY MI MI NY

(2)The NeumeierRules(a) Neumeier v. Keuhner (1972) p. 180. Car accident in Ontario. P is Ontarian, D is aNew Yorker. Conflict of law: guest statute.

(i) NY interest in application of its laws: compensating families of NY victims. Not atissue here.

(ii) ON policy interest in its law: it has an interest in protectingON drivers. Not atissue here.Held, apply Ontario law. This is a false conflict with split domiciliaries, and there is nosubstantive reason to displace ON as lex locus delicti.

(a) Where P & D share common domicile, common domicile controls.Becauseinterest analytic approach posits that state has interest in application of its lawonly to benefit its own domiciliaries, other state has no interest in applying itslaw here.

where false conflict of state interest (codomiciliaries), go withcodomicile

(b) Where P&D have split domicile and both P & D want to apply own law apply

the law of the place of the accident.where true conflict of state interest (split domicile, each trying toapply own law), apply lex locus delicti(c) In other situations of split domicile, typically apply lex locus delecti unlessdisplacing that law will (1) advance the relevant substantive law purposes (2)without impairing the smooth working of the multi-state system or producinggreat uncertainty.

where no state interest exists (split domicile, each trying to applyother law), usuallyapply lex locus delicti

Both expanded and narrowed by Schultz: applies only to loss-allocating rules

(b) Schultz v. Boy Scouts p. 183. Neuimeir applies beyond guest statute context.P's are suing in tort in NY. Sons were sexually abused while in joint care of Boy Scouts andFransiscans. NY connections: Forum, Some of the abuse occurred in NY, some of injuriessuffered there. NJ: P's domicile, Boy Scout's domicile, Some of the abuse occurred in NJ,some of injuries suffered there. OH: Fransican's domicile. Conflict of law: charitableimmunity

(i) NY does not recognize charitable immunity(ii) NJ recognizes robust charitable immunity

(iii) OH recognizes a limited form of charitable immunity that probably wouldn'tapply in this case (doesn't apply to negligent hiring)

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What are the states interest in applying their law? "The relative interests of the domicileand locus jurisdictions in having their laws apply will depend on the particular tort issue inconflict in the case." Locus state has the predominant interest in apply laws re: standardsof conduct; codomiciliary state has a greater interest in allocating losses fromadmittedly tortuous conduct. Neumeier rules apply to all cases involving lossallocation.

(iv)Boyscouts: share a common domicile with P. NY does not have any interest in notapplying charitable immunity. Designed to benefit NY P's. Don't have NY P's here. NJis intimately interested in applying charitable immunity rule to encourage charitablework within its borders. NJ law applies under Neumeier 1.

(v) Franscans: from OH, P from NJ. Want NJ law to apply, so Ohio has no interest. NJhas no interest in applying law. Under Neumeier 3, NY law should apply (lex locusdelicti) unless (1) the application of another states laws would further that Statesinterests (2) not impede the forum states interests and (3) enhance the smoothworking of the multi-state system. Here, applying NJ law would enhance its interestswithout frustrating New York (since NY has little interest here, as this is a lossallocating issue) and it enhances the smooth working by reducing forum shopping (NJ

may not apply Neumeier, so choosing to file in NY might otherwise be outcomedeterminative.)b) Bernard Curie-style interest analysis

(1) General approach:(a) If another state is claimed to have an interest rivaling the forums interest: determinepolicies underlying rules in each state and whether it is reasonable for each state toassert an interest in applying their policies to the particular case

(b) If only one state has an interest (e.g., common domicile of parties) apply law of onlyinterested state(c) Root out false conflicts: a more moderate and restrained interpretation of policyor interest of one state may avoid conflict (e.g., look at general principles behind policies to

see if they are being served or not served, in contract cases look to reasonable expectationsof parties)

(d) If true conflict remains (e.g., from NY and from Ontario) apply law of forum(e) If forum is disinterested but two other states have an interest and forum cannotdecline to adjudicate (forum non conveniens) apply law offorum, until better idea comesalong (cf. deciding which interest is more important or impaired)

(f) Ifneither state has an interest, each party attempting to claim benefit of anotherstates laws (unprovided for case) apply law offorum b/c of convenience (cf. better lawapproach)

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(2) Reich v. Purcell (1967) p. 191. Car accident occurs in MO. D from CA. P from OH. Conflictof law: Missouri has a damages cap, CA and OH do not. Missouri law designed to protect Missouriresidents from ruinous damage. No interest here. CA law designed to ensure CA Ps adequatelycompensated. No interest here. OH law designed to ensure Ohio Ps adequately compensated.Interest here. OH law applies.

(3) Hurtado v. Sup. Ct. (1974). Accident in CA involving Mexican P and CA D. Mexico has adamages cap, CA doesn't. Mexico has interest in protecting Mexican Ds from ruinous liability. Nointerest. California has interest in ensuring CA domiciliaries are adequately compensated, nointerest, and in ensuring people drive safely in California, interest. California has interest, soits law applies.

(a) Seinfeld makes a big deal about distinguishing these two casesbut in Reich, surely MOhad no interest inpromoting accidents and CA has no interest in promoting safe drivingoutside of CA.

c) Where true conflicts exist

(1) Lilienthal v. Kaufman (OR, 1964)--binoculars spendthrift case. D from OR, P from CA.Conflict of law: OR protects spendthrifts from liability once adjudicated a spendthrift absentguardian approval. CA has no such spendthrift statute. True conflict: OR law is designed to

protect Oregon families from liability for their deadbeat relati

Documents

Seinfeld Jurisdiction 2008