Jurisdiction Personal Two inquiries



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Parties cannot consent to SMJ  statute of limitations facilitates administration of claims, limits sovereign immunity, promotes judicial efficiency

  • Determining if case raises Q of SMJ

    • Clear statement rule

    • Real-world or courtroom activity?

    • Does requirement describe an attribute of a party?

    • Is requirement usually treated as jx?

    • Is the US a party?  sovereign immunity very important

  • State court SMJ

    • State court SMJ defined by state law

    • State courts have general/plenary power (power to hear any case unless removed)

    • Is the requirement only related to entering judgment on a particular defendant (PJ) or is it related to the court’s power to entertain judgment on a type of case (SMJ)?

    • Limitation/Fed Regulation

      • art VI, sec 1 full faith and credit – state has duty to apply transitory COA of other states, but may apply its own procedural law

      • supremacy - state may not discriminate against FCOA

      • exclusive jx - Congress may make jx exclusive to fed ct

      • concurrent jx – state courts may have concurrent jx under art III to hear fed claims

    • State courts of general jx must hear transitory causes of action that are justiciable under the laws of another state

      • Does not apply to penal proceedings and in-rem proceedings

    • Hughes v Fetter – action brought in WI predicated on IL wrongful deaths statute: WI has jx over D, but needed to use IL law b/c law must originate from same state as where tort occurred

      • state may not carve out jx to refuse to hear cases which it does not want to

      • balancing test – balance state’s policy for closing itself off from foreign law with full faith and credit (if one state creates a right, others should enforce it)

    • Howlett v Rose state court ruled that under state-law sovereign immunity it need not hear a case against a state school board, even though the claim was of fed law and fed law does not prescribe state sovereign immunity

      • state cannot decline to hear a case that falls under fed law on basis of policy disagreements; article VI supremacy clause


    Federal Court SMJ

    • article III, sec 1 – power vested in one SCOTUS and all inferior courts as established by Congress

      • sec 2 – scope of Congr power to invest jx in fed ct

        • party based jxbased on status of parties

          • ambassadors, public ministers, consuls

          • when US is a party

          • 2 or more states; state and citizens of another state; citizens of diff states; foreign states/citizens

        • claim based jx – all cases arising under constitution, laws of US, treaties; all cases of admiralty and maritime jx

    • Capron v Van Noorden – P claimed that both parties were from NC, so NC cir ct did not have jx

      • SMJ of fed ct limited by art III, sec 2

      • Record does not show that either party is from outside NC

      • A party cannot consent to fed SMJ

      • Limiting fed jx under federalism  court must be cautious to be sure it has jx

    • Diversity jx – diversity of citizenship and alienage

      • Diversity jx– state law claim x/ citizens of diff states

        • Party invoking diversity jx has burden of identifying citizenship of each and every aprty

        • 2 statutory requirements (28 USC § 1332a) – must have diversity jx and must meet amt in controversy (75k)

        • must be US citizen (Dred Scott v Sanford); art II, sec 2 (non-US citizens cannot sue other non-US citizens in fed ct unless US parties added)

        • must be citizen of a state

        • must have complete diversity (Strawbridge)

        • Mas v Perry – P Mas sued D Perry for invasion of privacy; after judgment, D appealed claiming no SMJ of fed ct as all parties were residents of LA

          • Residence determined by domicile (§1332(2))  person remains domiciliary of home until he finds a new domicile

          • Intent to remain – org membership, license, lease, voter registration

          • One P is citizen of Fr, other is domiciled in MS  diversity jx satisfied

        • 1332c – corp is citizen of state/foreign state in which it is incorporated and state/foreign state in which it has principle place of business

        • Hertz Corp v Friend – P Friend sued D Hertz in CA state ct seeking damages for violations of CA law; D filed for removal to fed ct claiming diversity jx as it PPB was in NJ

          • Nerve center test – PPB = place of direction/control/coordination of corps activities  not offices, but HQ

          • facts suggest nerve center is in NJ

        • 1332(d)(10) - unincorporated associations

          • citizen of state where it has PPB, state under which laws it was created; where its members have citizenship

          • aggregate test - determined by the citizenship of each of its members

          • insurance cos have citizenship of those they insure (§1332c)

      • alienage jx - art IV, sec 2 “btw a state/its citizens and foreign states/citizens/subjects”

        • stateless aliens don’t meet requirements of 1332

        • 1332a3 – citizens of diff states + foreign citizens joined

        • 1332a4 – foreign state party against a citizen of a state or diff states (foreign state must be recognized by executive branch)

        • 1332aDeeming Provision  a PRA shall be deemed citizen of state in which he is domiciled

        • 1332a2Jurisdiction Clarification Act – no fed jx over PRA domiciled in same state as US citizen on other side

        • think about – corps w/ mult citizenship, natl banks citizens where located, dissolved corps

    Collusion

      • Kramer v Caribbean Mills – co assigned its interest for 1$

        • Assignment was improperly or collusively made

        • Test – is there a pre-existing relationship? Is business relationship valid in assignment? What are the usual practices of the company?

        • §1359 – no jx over any party/assignment that has been improperly/collusively made when done so to created jx

      • Rose v Giamatti can’t frivolously add Ds w/o interest in suit in order to defeat fed jx; court may sever parties w/o interest

        • Rule 21 – court may at any time add/drop/sever claims against a party under; may not dismiss action

          • Fraudulent joinder – no basis for claim

          • Improper joinder – parties joined through incorrect procedure

        • Rule 17 – action must be against real party in interest

        • Two parties’ citizenship ignored when determining diversity as they had no real stake in dispute



    Amount in Controversy

    • Aggregation – parties must be joined under R20, claims R18

      • R18 – single P can join and aggregate all claims against single D

        • multiple P’s cannot aggregate claims that are separate and distinct, but may aggregate claims that are common, single and indivisible  look to substantive law (common/indivisible is not “arising out of same transaction)

      • !!! supplemental jx may cure fed defect when one claim does not meet amt in controversy and cannot be aggregated under R18

    • Claims must be made in good faith; must be legal certainty that claim is really for more than amt needed for jx  Red Cab Rule

      • Sum by P controls if alleged in good faith and if it cannot be shown to legal certainty that amt falls short

      • Post-filing findings only admitted if they infer bad faith

      • If damages do not meet AIC, ct retains jx

    • Valuing an injunction – P’s value of claim v D’s cost of compliance  is this original jx or removal?


    Exceptions

    • Divorces/alimony/child custody (domestic relations), will contests  fed ct may dismiss case of may abstain (declines to exercise diversity jx in favor of state ct)

    • Ankenbrandt v Richards – physical/sexual abuse charges may be heard in fed ct

    • Marshall v Marshall – no policy behind probate exception in case of tortious interference as state courts have no special proficiency in dealing with tortious interference with estates



    Federal Court Jurisdiction: Federal Question

    • Need 2 things: fed issue on face of complaint, which is sufficiently substantial

    • Art II, sec 2 “arising under”; also §1331 (but 1331 read more narrowly than art II, sec 2)

    • Goals – forum hospitable to fed interests, uniform interpretation, institutional expertise, nationalist (protect fed power), federalist (protect states), democratic (protect majority), individual rights, commerce

    Constitutional/Federal Ingredient Test

      • Osborn v BUS – fed ct enjoined state auditor (P) from collecting state tax from BUS, P appealed that fed ct did not have SMJ (state law claim)

        • BUS responded w/ constitutional issue, but constitutional defense does not confer fed jx

        • Congress authorized fed jx on all cases involving BUS, Congress has this power under art II, sec 2

        • Once jx is attached, the presence of a nonfederal issue does not defeat jx

        • Federal ingredient test: once case contains a fed ingredient, fed ct potentially has authority to resolve all issues of the case  broad application

      • Q – does arising under power support jx over cases in which fed statute gives jx but state law provides ROD?  under constitution yes; under statutory test, no

      • BUS v Planters’ Bank of GA – any case involving BUS falls under fjx regardless of nature of claim (state/fed)

    Statutory Test (§1331)

      • Louisville & Nashville v Mottley – P (Mottley) brought breach of contract action in KY cir ct, D claimed breach was in compliance with Congressional act, P claims act violates 5th Am

        • Anticipation of defense based on constitution may not be used to confer fjx; original cause of action must arise under fed law or constitution

        • must be well-pleaded complaint  federal Q must be on the face of the complaint (not a defense)

      • States may include federal elements in statutes if they want fjx, and leave elements out if they don’t want fjx

      • Mottley argued as being over-inclusive (lets in too many cases); others argue its too narrow (doesn’t allow fed jx over fed claims brought as D)

      • Explicit/implied COA in statutes

        • Shoshone Mining v Rutter - federal law defines how miner’s (Rutter) patent claim should be filed under state law

          • There is a federal COA, but rule is state law, so not fjx

          • Fed ROA + state ROD = insubstantial

          • Would cause avalanche of local property claims

        • Smith v Kansas City Title & Trust - bank (D) bought US bonds, Smith (P) shareholder brought suit against D claiming that this investment violated MO law; bonds were bought under federal program, constitutionality challenged

          • Action arises under fed law as state COA turns on constitutional issue  relief depends on constitutional interpretation

          • Fed law claim sufficiently substantial

          • State COA + const Q = substantial

          • National fiscal interest

        • Moore v Chesapeake RR – P (Moore) sues employer (D) under KY law and also alleges D failed to comply with fed safety requirement

          • Case is largely state court action; fed safety requirement only alters defenses  no fjx

          • State COA + federal Q in defense = insubstantial

          • Only affects intra-state employment

      • Merrell Dow v Thompson – state tort action in OH ct by P (Thompson), D filed for removal (one claim was under FDCA)

        • fed law, but not fed ROA

        • ROA is under state tort claim

        • Bright line rule – no fjx w/o independent fed ROA (shows fed interest)

          • But there are exceptions after Smith and Moore depending on substantiality of fed interest

          • Smith – state COA invoking fed norms grants fjx

        • Brennan’s dissent – existence of fed law expresses fed interest

      • Grable & Sons Metal v Darue – IRS seized P’s property and gave it to D; P claimed notification by IRS of seizure violated fed statute in state ct; D removed to fed ct

        • new test (4 prongs)

          • state law claim must raise fed issue;

          • fed issue must be substantial

          • fed issue must be disputed

          • fjx must not disturb balance of federal/state judicial responsibilities

        • MD does not make presence of fed ROA mandatory

        • Fed interest sufficient for jx

      • Empire Healthchoice v McVeigh – P (Empire) insurers D (McVeigh), a fed employee; P sued D’s estate to recoup medical expenses after estate recovered from 3rd party; fed statue silent on whether insurers can recover from 3rd parties, but P has contract with fed office which requires taking measures for such recoupment

        • Disputed fed issue = disputed legal, not factual Q (ie – fed ROA or fed act triggering case?)

          • No disputed fed statute as required by Grable  no legal Q, Q was factual

          • Congress did not create fed ROA

        • US govt not a party

        • Fjx would disrupt federalism and create avalanche of lit

      • Summary of Fed Q Jx

        • Mottley – well-pleaded complaint

        • Grable - fed issue must be disputed

        • Substantialityexistence of ROA within statutory scheme (Merrel Dow), involvement of govt (Grable), or constitutional ROD (Smith)

        • Must not disrupt federalism

        • Grable 4-prong test clarified by Empire Healthchoice


    Pendent/Ancillary Jurisdiction

    • Pendent jx – claims/parties joined in P’s complaint

    • Ancillary jx – claims/parties joined after filing complaint

    • Hurn – fed ct may exercise pendent jx over state law claims that provides alternative ground for relief for substantial fed COA

    • United Mine Workers v Gibbs – P Gibbs brought COA against D UMX for violations of fed statute and TN law in fed ct

      • Applied Hurn

      • Test for pendent jx: must fall under art III, must be fed ingredient, must be substantial federal claim under §1331

      • State and fed claims must have common nucleus of operative fact

      • Fairness and efficiency considerations

      • Exercise of power is discretionary:

        • Were fed claims dismissed before trial?

        • Do state law claims predominate?

        • Jury confusion?

        • Is state claim closely tied to fed policy?

    • Specialty joinder rules

      • Rule 14 – impleader; seeking indemnification from 3rd party D

      • Rule 19 – required/necessary party

      • Rule 24 – intervention; stranger can join suit

    • Limiting pendent jx

      • Aldinger v HowardP brought suit against officers for fed law violations, fed law did not apply to county, so P joined country under state law  fed jx?

        • Cannot join D on state law claim w/o independent basis of fjx

        • Congress specifically declined to include county as party who may be sued under this fed statute (intent not to try these parties in fed ct)

      • Owen Equipment v Kroeger – wrongful death suit w/ diversity jx, D impleaded 3rd party discovered to have same PPB where P had residency

        • §1332a1 requires complete diversity; circumstances of case do not negate express Congressional acts

      • Aldinger and Owen favor pendent/ancillary jx unless specific grant of jx withholds such power

      • Finley v US – one claim against fed agency (exclusive fjx), other claim against nondiverse D under state law

        • Pendent-party jx requires Congressional authorization

        • Fed statute confers jx over action against US, which court infers as only actions against US  no explicit grant of pendent-party jx

        • Bright line rule disfavoring pendent-party jx

      • Pendent claim –common nucleus of operative fact

      • Pendent-party – explicit

    Supplemental Jurisdiction

    • In response to Finley, Congress passed §1367

      • A – supplemental jx allowed when

        • 1 – fed jx over original claim, and

        • 2 – supp claim is related and of the same controversy as original claim

      • B – if fjx of original claim rests on diversity, supp jx not allowed for R19 (required), R20(permissive), or R24(intervening) defendants; or for R19/24 plaintiffs

        • No supplemental jx over parties that will destroy diversity

      • C – fed ct may decline jx over

        • Novel/complex state law issues

        • State law claim predominates (like in Gibbs)

        • All claims with original fjx dismissed

        • Exceptional circumstances + compelling reasons

      • Are these (c) the exclusive grounds for declining SMJ

    • Exxon Mobil v Allpattah – two cases, both which joined some Ps who did not meet amt in controversy

      • 1367b only excludes claims against Ds joined under R20, does not exclude Ps joined by R20/23 when at least one other party meets AIC

      • amt in controversy not a constitutional Q like diversity

      • supplemental jx of other parties not meeting amt in controversy allowed as long as Strawbridge is satisfied

    • KokkenenSCOTUS confirmed existence of ancillary jx when court needs to enforce orders


    Removal Jurisdiction

    • Removal - §1441

      • 1441b2 - Ds properly joined and served may not remove case to fed ct

        • 1446b2A – all Ds properly joined and served must consent to removal petition; “rule of unanimity”

        • 1446b2B – each D in suit has 30 days to seek removal regardless of when served; “last served D” rule

      • 1446b3 – if suit not removable based on initial pleading, D may file notice of removal w/in 30 days of receipt of amended pleading/motion

      • 1446c1 – exception to one-year rule for diversity cases; applies when P acts in bad faith to prevent D from removing

      • 1446c2 – AIC base on P’s complaint unless D asserts

        • meets statutory req if nonmonetary, monetary but state law does not allow complaint to include specific amt, or state law permits recovery in excess of amt alleged in complaint

      • 1446c3A – Ds who lack adequate info during 30-day window to use discovery to determine AIC

    • §1441 – removal only allowed to Ds; fed ct must have jx over original complaint

      • a counterclaim (R13) or affirmative defense cannot be basis for removal

        • but there will be fjx over counterclaim “so related that it is part of the same case or controversy”

      • 1441bin-state D cannot remove

      • 1441c – removal allowed when fed claims are joined w/ state law claims (not transactionally related), but the unrelated claim must be severed and remanded to state court, if the fed claim would be removable on its own

      • 1441f (derivative removal) – if court from which suit was removed did not have jx over a claim, fed ct is not precluded from exercising jx over that claim

    • §1446 – removal motion can be made for up to 1 yr after original filing, but must be made within 30 days of obtaining info that case can be removed

    • burden of proof is preponderance of the evidence standard to demonstrate legal certainty

    • SMJ can be challenged at any time during lawsuit (direct attack)

    • Opportunity for collateral challenge limited


    Applicable Law

    • 28 USC 1652 – Rules of Decision Act  laws of states shall be regarded as rules of decision in civil actions where they apply, except where fed law otherwise provides/requires

    • 28 USC 2072 – Rules Enabling Act  allows Congress/Supreme Court to enact rules of procedure for fed cts as long as such rules to not abridge or odify state’s substantive rights

    • Swift v Tyson – diversity action to enforce bill of exchange; NY law would not allow for enforcement of note  did fed ct have to apply NY law under RDA?

      • Judicial decisions are not “laws” under RDA, they are evidence of the laws but not the laws themselves

      • In absence of state statute, fed ct has power to announce common law ROD, can base ROD on construction of general common law

      • b/c NY statute existed, ct applied it

    • Eerie v Thompkins – P injured by train while walking on path next to D’s RR, PA law placed lower duty on RR than fed law, P took case to NY-based fed ct  what law applies?
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