JOINDER
Historically what these rules did was merge law with equity. Around the 1840s starting in New York, and followed by the federal system in the 1930s, courts decided to abandon altogether the common law pleadings and adopted equitable pleadings and in the process merged law and equity. The rules of civil procedure represent a triumph of the equitable pleadings over the common law pleadings.
One of the most important parts of equitable pleadings was the concept of Joinder. Liberal Joinder: join as many parties that have an interest in the litigation and assert as many claims and theories against as many parties as the circumstances may allow.
Rule 18. Joinder of Claims and Remedies
(a) Joinder of Claims.
A party asserting a claim to relief as an original claim, counterclaim, cross-claim, or third-party claim, may join, either as independent or as alternate claims, as many claims – legal, equitable, or maritime, as the party has against an opposing party.
Again, this is so ingrained in our jurisdictions, we don’t think anything about it. One hundred years ago this would have been considered extremely radical.
This allows claimants to bring all claims they may have against the person already a party to the case even if the claims are not related to one another. This promotes judicial efficiency.
Every joinder rule is subject to the other procedural rules, most notably: subject matter jurisdiction, personal jurisdiction, and Venue.
The Supreme Court is careful to not overstep its bounds. Jurisdiction is limited by that specific authority granted either by the Constitution or by congress. If there is no specific grant of authority the Federal Courts do not act. Remember, absent jurisdiction the courts will not act. So, every Joinder rule and every person before the court must satisfy subject matter jurisdiction and personal jurisdiction.
Rule 13. Counterclaim and Cross-Claim
(a) Compulsory Counterclaims.
A Compulsory Counterclaim arises from the same transaction or occurrence that led to the plaintiff’s complaint against the defendant. The important thing is: if the defendant doesn’t bring the compulsory claim, then it is waived and the defendant is forever barred from asserting that claim against the plaintiff.
Some exceptions to the nature of a compulsory counterclaim is even if the claim arises from the same transaction or occurrence it is not compulsory if the counterclaim requires Joinder of some additional party who is not subject to the court’s jurisdiction. A compulsory counterclaim is not required if there is a pending action.
Example: Let’s say that the defendant already has an action pending against the plaintiff in state court and the plaintiff sues in Federal Court, the defendant is not required to bring the counterclaim if the defendant already has a state claim pending. So, if there is another case pending then it’s not a compulsory claim anymore.
Finally, if the claim is immature or in other words, at the time that the original complaint is brought, the defendant’s counterclaim has not yet matured.
(b) Permissive Counterclaims.
Permissive counterclaims are counterclaims that do not arise out of the same transaction or occurrence. The defendant in such a case has a choice to either bring the counterclaim or file a separate lawsuit. With a permissive counterclaim you often have jurisdictional issues because by definition supplemental jurisdiction is not going to apply because it did not arise out of the same transaction or occurrence. A permissive counterclaim has to satisfy subject matter jurisdiction and personal jurisdiction.
(g) Cross-Claim Against Co-Party
A cross-claim is filed against a person who had not until the claim has been filed, been an opponent to the party filing it.
Example: Plaintiff v. two defendants when one defendant brings a claim against another defendant.
It is always permissive, never compulsory. It must also meet the requirements of subject matter jurisdiction. Subject matter jurisdiction is not a problem because by definition it arises out of the same transaction or occurrence. You must also meet personal jurisdiction. That usually is not a problem because the court has acquired jurisdiction over both defendants because otherwise one of them would have been dismissed before you brought the cross-claim.
Rule 20. Permissive Joinder of Parties
(a) Permissive Joinder.
A person joins as either as plaintiff or defendant. He or she must have claims that arise out of the same transaction or occurrence or a series of transactions or occurrences. All parties joined must have common at least one question of law or fact.
Rule 14. Impleader.
Impleader is when a defendant brings a third-party action against somebody who is not a currently a defendant. The limitation on this rule is that the Third-Party Plaintiff who brings the Third-Party action alleges that the liability is derivative meaning: that if I am liable to the plaintiff, then you liable to me. The defendant cannot say, it’s not my fault I am not liable, it’s your fault you are liable. That is not a derivative claim. How do you determine what is a derivative claim? In a diversity case it depends upon the substantive law of the state in which the case is filed.
28 U.S.C. 1367. Supplemental Jurisdiction.
The Three Step Process to determine whether supplemental jurisdiction exists:
Step 1, 1367(a):
You must have an anchor claim which is a jurisdictionally sufficient claim. The jurisdictionally insufficient claim must arise out of the same common nucleus of operative facts as the anchor claim.
If that exists, you move to Step 2.
Step 2, 1367(b):
1367(b) operates to preclude the exercise of supplemental jurisdiction when all four of the following requirements are met:
1. Diversity of citizenship;
2 Jurisdictionally insufficient claim is brought by a plaintiff;
3. The jurisdictionally insufficient claim is brought against parties joined under rules 19, 20, 14 or 24; and
4. Exercising jurisdiction over the supplemental claim will destroy diversity.
If Step 2 does not preclude the exercise of supplemental jurisdiction you then proceed to Step 3.
Step 3, 1367(c):
The discretionary factors:
1. Should the Federal Court, who now has the power to entertain the jurisdictionally insufficient claim, exercise its power, the rule instructs the judges that they should not exercise the power if the supplemental claim raises novel or complex issues of state law or the supplemental claim substantially predominates over the federal claim.
2. The court has already dismissed the federal claims leaving nothing but the supplemental claims
3. The catch all – for all other compelling reasons.
Exxon v. Allapattah v. Star-Kist Foods
Supreme Court, 2005
In No. 04—70, Exxon dealers filed a class action against Exxon Corporation, invoking the Federal District Court’s 28 U.S.C. § 1332(a) diversity jurisdiction. After the dealers won a jury verdict, the court certified the case for interlocutory review on the question whether it had properly exercised §1367 supplemental jurisdiction over the claims of class members who had not met §1332(a)’s minimum amount-in-controversy requirement. The Eleventh Circuit upheld this extension of supplemental jurisdiction. In No. 04—79, a girl and her family sought damages from Star-Kist Foods, Inc., in a diversity action. The District Court granted Star-Kist summary judgment, finding that none of the plaintiffs had met the amount-in-controversy requirement. The First Circuit ruled that the girl, but not her family, had alleged the requisite amount, and then held that supplemental jurisdiction over the family’s claims was improper because original jurisdiction is lacking in a diversity case if one plaintiff fails to satisfy the amount-in-controversy requirement.
Held: Where the other elements of jurisdiction are present and at least one named plaintiff in the action satisfies §1332(a)’s amount-in-controversy requirement, §1367 authorizes supplemental jurisdiction over the claims of other plaintiffs in the same Article III case or controversy, even if those claims are for less than the requisite amount. Pp. 4—25.
In this case there was a conflict among the circuits. One circuit said that each member does not have to meet the jurisdiction requirement and therefore they can all be part of the suit under the supplemental jurisdiction statute. In the Star-Kist case the court said no, you must so the Supreme Court took both cases to resolve the conflict.
At the end of the day, the court held in favor of Exxon Mobil. In Exxon they said that as long as one plaintiff meets the jurisdictional limit, all the other plaintiffs can thru supplemental jurisdiction remain in the suit. In Star-Kist the court said no, if one plaintiff meets the jurisdiction that plaintiff could stay but all the other plaintiffs have to be dismissed.
When a well-pleaded complaint has at least one claim satisfying the amount-in-controversy requirement, and there are no other relevant jurisdictional defects, the district court, beyond all question, has original jurisdiction over that claim. A court with original jurisdiction over a single claim in the complaint has original jurisdiction over a “civil action” under §1367(a), even if that action comprises fewer claims than were included in the complaint. Once a court has original jurisdiction over the action, it can then decide whether it has a constitutional and statutory basis for exercising supplemental jurisdiction over other claims in the action. Section 1367(b), which contains exceptions to §1367(a)’s broad rule, does not withdraw supplemental jurisdiction over the claims of the additional parties here. In fact, its exceptions support this Court’s conclusion. Pp. 11—13.
The controversy here
This was a 5-4 decision and the Court was quite split on this issue. Justice Kennedy wrote the majority and Justice Ginsberg wrote the dissent.
They justices are just looking at Section 1367 which created supplemental jurisdiction. Part of the reason why this case is cited a lot has nothing to do with the procedural aspect of it but it was Kennedy’s assertion that the statute is not ambiguous. When a statute is not ambiguous you simply the statute as written. If it’s ambiguous you have to draw from other legislative history. Justice Ginsberg looked at legislative history and said, it’s pretty obvious Congress did not intend as radical a change as the majority was proposing. Up until this statute was enacted, there were two things that you had to have for diversity jurisdiction – 1) Complete diversity; and 2) The claim had to meet the jurisdictional limit. According to Ginsberg, the congressional history of this didn’t at all indicate that they intended to change the fundamental concepts.
The interesting thing about the fundamental concepts is this:
Complete diversity and all plaintiffs must meet the jurisdictional limit. Those two concepts are judicially created. The US Constitution Article III simply says that the court will have jurisdiction over citizens from different states. It doesn’t say that every single plaintiff must be diverse from every single defendant.
When Congress enacted the Judiciary Act of 1780, which was one of the first acts to be created, they created diversity. The diversity statute which reads very similar to the way it reads to day simply says the Court has jurisdiction over citizens of different states. In the 1800’s Justice Marshall said that requires complete diversity even though the Constitution doesn’t really say that nor does the statute really say that. But since Congress has amended the statute dozens of times over the last 200 years and has not changed it, the Court correctly assumes that Congress likes the decision.
There is nothing in the Constitution that even provides for a minimal jurisdictional limit but what Congress did is say the claim had to be in excess of a certain amount. It does not say that every single plaintiff has to meet that – that’s a judicially created factor. Here the Supreme Court comes along and what Justice Kennedy does is he changes that doctrine. What Ginsberg objects to is, this has been a long standing rule and that rule has been standing for literally hundreds of years. There is no indication that Congress intended such a radical change and she says it’s very disruptive.
On legislative history Justice Kennedy said it’s like looking out into a crowd and picking out your friends. In other words if there is a lot of history you can take bits and pieces of it to support your argument and brush under the rug those things that don’t support your argument.
Congress makes laws and if the Supreme Court interprets a congressional law, the interpretation becomes the law. What is to prevent an unelected staff member from literally falsifying the history and putting it in record? If the Supreme Court picks up the false memo, he or she could change the law of the entire nation and Kennedy points that out. Legislative history is not reliable.
What is the Exxon rule? At least one plaintiff must meet the minimum amount of controversy for any joinder. So long as one plaintiff meets the jurisdictional limit, all the other plaintiffs can, under the supplemental jurisdiction statute, remain in the case.
If the court is willing to basically disregard this judicially created doctrine that every plaintiff must meet the jurisdictional limit (Kennedy just tosses that out the window), why doesn’t he also toss out that judicially created concept? Why don’t they just say, for that matter, they don’t even have to be diverse? That issue is not before the court in this case but in theory what is to prevent the court from doing that in the future? Justice Kennedy addresses that by saying even though the Constitution doesn’t mandate complete diversity; the underlying policy was a citizen of New York could not get justice in a court in Virginia. If there are parties from the same states that reduces that risk. So the policy of keeping complete diversity is still a very important but the policy that each party has to meet the minimal jurisdiction doesn’t really have any constitutional implications. That limit is not even in the Constitution, Congress simply created that in order to reduce the workload of the Federal Courts.
Rule 19. Joinder of Persons Needed for Just Adjudication (Compulsory Joinder Rule)
Rule 19 basically involves bringing a person kicking and screaming into the courtroom because that person doesn’t necessarily want to be in the courtroom. The court orders that person in the lawsuit because that person is necessary to the lawsuit. Even if the existing parties don’t want that person in the suit, under Rule 19, if the provisions are met the court must add the parties.
A three-step analysis:
Step 1: When it is necessary to add a party;
Step 2: When it’s feasible to add a party; and
Step 3: Determine whether the party is indispensable.
STEP 1: NECESSARY PARTIES
When is a party necessary? Factors to consider:
Factor 1: If complete relief cannot be granted to those already parties in the absence of a person proposed to be joined under Rule 19.
Example: A beneficiary to a life insurance policy. $100,000 is left to five children and a dispute arises over who gets the money. Three children file a lawsuit and two of them do not. Can the court make that determination without affecting the two absent children? No.
Lawsuits involving in real estate:
Example: A cottage was left to five children. Five children are on a deed but only four are in the lawsuit. A court cannot reform a deed. That fifth person has to be in the lawsuit and that is a true definition of a necessary party. Otherwise the decree would be useless because it wouldn’t be binding on one of the persons on the deed.
Factor 2: The court may order Joinder of a non-party who has a significant interest in the subject matter of the litigation and whose interest may be imparity or legally in the absence of Joinder. (Life insurance policies)
Factor 3: The non-party has significant interest in the subject matter of the litigation and the existing parties may be subject to liability or inconsistent obligations in absence of the non-party (Overlapping interest).
Example: Let’s say there is a car accident and two people injured. The driver who caused the accident is insolvent with a $20,000 policy. One person files a lawsuit and sues for $100,000. The pool of money is only $20,000. There is another party who has a significant interest because they too were injured in the accident. The insurance company for the driver is concerned that if they pay the $20,000 by way of settlement and are sued by the other driver, it might face multiple parties and multiple liabilities. The insurance company has two choices: 1) they can implead; or 2) they can simply move to join the other injured party and make sure that everyone who has an interest in this $20,000 is a party to the lawsuit. Those are things they consider to determine if it’s necessary. What impact it would have on the case.
STEP 2: FEASIBILITY
Is it feasible to add these parties?
Under Rule 19(b), if the absentee party is found to be necessary under 19(a), the person must be joined if feasible. This is not discretionary. If the court determines that a party is necessary and if it is feasible they must be joined – it is mandatory. What is feasible? Feasibility is directly tied to jurisdiction. It must be determined whether a court can acquire personal jurisdiction over the absent party. If there is no personal jurisdiction, then obviously it is not feasible to add that party. If adding that party would destroy subject matter jurisdiction it’s not feasible to add that party. If the court can acquire personal jurisdiction over the necessary party and if adding that necessary party will not destroy subject matter jurisdiction, the court has no discretion it must add that party if the court has determined that party to be necessary.
In contrast, if the court cannot obtain personal jurisdiction over that party or it would destroy subject matter jurisdiction, then the court has to proceed to Step 3 and ask if the party is indispensable.
STEP 3: INDISPENSABLE PARTIES
Is the party indispensable?
If it turns out the party is indispensable, the court must dismiss the case. In contrast, if the necessary party is not indispensable the court can proceed. What the courts look at for indispensability:
The court shall determine whether in equity and good conscience the action should proceed among the parties before it, or should it be dismissed, the absent person being thus regarded as indispensable. The factors to be considered by the court include: first, to what extent a judgment rendered in the person's absence might be prejudicial to the person or those already parties; second, the extent to which, by protective provisions in the judgment, by the shaping of relief, or other measures, the prejudice can be lessened or avoided; third, whether a judgment rendered in the person's absence will be adequate; fourth, whether the plaintiff will have an adequate remedy if the action is dismissed for nonjoinder.
Now the court has to determine whether to dismiss the lawsuit. What adverse consequences are there? The court has the power to fashion its own remedy. The looks at rendering its judgment in such a way to minimize the effects it may have. The judge will often ask, if we are wasting or time or can’t this be filed in state court? If a federal judge determines there is an adequate forum out there, then the court is much more comfortable dismissing the case. Finally, the court will look at if the judgment that I render is going to be so inadequate because of that extra person out there that the extra person will still be able to file a lawsuit in state court and multiplying the litigation, the court is more likely to dismiss it in that case because it simply can’t fashion a remedy that’s going to avoid that kind of multiple litigation.
THE PROCEDURE:
When you file a motion to dismiss, you will file a 12(b)(7) motion to dismiss (lack of an indispensable party). Rule 19 however does not have a specific time limit so the court can deny a motion on untimelyness. The court basically has four options:
1. The court could simply determine that the party is not a necessary party and deny the motion;
2. The court could determine that the absent party is necessary;
3. The court might find that the person is necessary but joinder is not feasible, but that person’s presence is not indispensable and therefore deny the motion; and
4. The court could find that the non-party is necessary and indispensable in which case the court must grant a motion to dismiss.
Temple v. Synthes Corp.
Supreme Court, 1990
This was an appeal of a dismissal in an action for damages for products liability, medical malpractice, and negligence. The dismissal was for a failure to join a necessary party.
FACTS: An implanted plate and screw in Temple's (P) back malfunctioned. P underwent surgery wherein the plate and screw were inserted into P's spine. The screws broke off inside P's spine. P sued Synthes (D), the manufacturer of the plate and screw, for products liability in federal court based upon diversity.
The defendant files a 12(b)(7) motion and the district court agrees with the defendant. Among the options, that procedure is both common and appropriate. The court in this case talks about judicial economy.
The court gave P twenty days to join the necessary parties in the interests of judicial economy. P did not join the doctor and the hospital and the court dismissed the suit with prejudice. The court of appeals affirmed that decision: Fed. R. Civ. P 19 allows mandatory joinder of necessary parties in the interest of efficiency. It was stated that D might claim that the doctor and the hospital were negligent and the device was not defective, and on the other hand, the doctor and the hospital would claim that they were not negligent and that the device was defective. P appealed; joint tortfeasors are not indispensable parties under Rule 19(b).
Temple appealed and the 5th Circuit affirmed. The problem is that it has nothing to do with Rule 19. The judge can’t think that it’s judicially more economic to join the other parties because it’s what congress thinks that is important. The 5th basically said that these defenses are joined. The doctor was saying that the manufacturer screwed up, the manufacturer says it was the doctor, so their defenses are intricately linked and therefore the doctor and the hospital are necessary parties necessary to the manufacturer.
Per curiam: by the court. No one justice authored the opinion. It is such a no brainer, they just issue a brief statement by the court to reverse.
The Analysis:
Can the plaintiff get complete relief against the manufacturer without the doctor and the hospital? Yes, thru joint and several liability so long as they don’t double dip. They don’t even get past step one. This is the nature of the federal system.
Would any of the existing parties be subject to multiple or inconsistent judgments? No, the doctor and the hospital aren’t going to be bound by anything that happens in federal court and the manufacturer is not going to be bound by anything in state court. Under joint and several liability you can only collect the amount of the judgment. Joint tortfeasors are not always necessary parties under Rule 19.
Helzberg’s Diamond Shops v. Valley West Des Moines Shopping Center
8th Circuit, 1977
This was an appeal from a denial of a motion to dismiss for failure to join an indispensable party under Rule 19.
FACTS: Helzberg's (P), a jewelry store, leased space in Valley West's (D) shopping center. The lease agreement provided that no more than one other similar store would be allowed to rent space in the mall. D leased space to a third jewelry store called Lord's. Lord's lease allowed them to be a retail specialty jewelry store and not as a catalogue or full line jewelry store as was called for in P's lease as well as the restrictions with P's lease. Despite these semantics, Lord's intended to open a full line jewelry store. P sued for injunctive relief. P sued in federal District Court under 28 USC 1332 based upon diversity of citizenship between the parties and an amount in controversy of more than $10,000. P served D pursuant to a Missouri long arm statute. D moved to dismiss under Rule 19 on the ground that Lord's was not joined and was an indispensable party. P sued in district court in Missouri and could not obtain personal jurisdiction over Lord's, which had no Missouri contacts. The court enjoined D from breaching the lease and denied D's motion, and D appealed.
Step 1: Under Rule 19 is Lord’s is a necessary party?
Step 2: Is Lord’s feasible? Does it destroy subject matter jurisdiction or personal jurisdiction?
Step 3: Is Lord’s an indispensable party?
We have necessary and not feasible because there is no PJ over Lord’s. If the party is necessary you have to add feasible. If it’s not feasible then the court has to determine whether a party is indispensable. That’s the question presented here. If I’m the judge, do I dismiss or not? If the party is indispensable I dismiss.
The court looked at obvious prejudice to Lord’s to determine whether it was dispensable or not. The court said that these were separate agreements and that by granting the injunction affects the other. Lord’s still had rights under the second agreement – they can sue for breach of contract to enforce their agreement with the property and therefore they are not indispensable. When Valley West complained they were saying that they might be subject to multiple lawsuits. The court said whose fault is that? You guys are the ones who signed two separate agreements. Valley West’s argument is that they never breached the contract and the contracts are consistent with one another. Benson: The judge dismisses that and in effect decides the case making it unfair. I don’t like this decision.
If it’s necessary and feasible, you must join the party. It’s only when it’s not feasible to you move to Step 3.
If 1 and 2 is true, you stop right there. If 1 is true but 2 is not feasible you move to 3.
Hypos on Page 772:
a. Lets remember the three step analysis: Whether those parties are necessary and then is it feasible and then indispensable. Under subsection (a), subpart (2) they are because they all have an interest in these cattle and as a practical matter their rights are going to be impaired if the bank takes away all of the cattle and the other people are left without cattle.
It’s not feasible to add them because they wouldn’t have subject matter jurisdiction. The next step is indispensable. Professor Yeazell reminds us of replevin (mine to possess). If the bank wins, what happens to the other creditors? They don’t loose anything; they only loose the possession of cattle. There is nothing to prevent to brining an action against the bank. They are not indispensable, the matter can proceed because the other creditors have not lost their rights. There interest is affected but not enough to be indispensable – they have other options and forums to pursue.
b. A Spendthrift Trust: Someone who wants to leave a lot of money to another adult but fears he will blow it all. You create a spendthrift trust with a trustee for when to give the money and for what purpose. In this case there are two important factors: 1) under the language of the trust agreement, the trustee could chose to give all the money; and 2) should Larry die that trust descends to the children. Larry sues the trustee whether or not to get the entire trust.
Are the children necessary parties Under Rule 19(a)? The children have a future interest. The children have an interest but it’s a future interest. If Larry proceeds with this action without the children being parties will the resolution possibly affect the rights of those children? If Larry wins all the money goes to him so it does affect their rights. They are necessary parties.
c. There is a potential for multiple and overlapping judgments. What the insurance company could do is pay the money to the court and sue everybody and let the court distribute the money. The key is the defendant knows he’s liable to somebody. Why should the defendant have to fight multiple lawsuits when it’s not their fault the wives are fighting? They know they have to pay but they don’t know whom to pay. That is called Interpleader.
Rule 24. Intervention.
Two types:
1. Intervention by right; and
2. Permissive intervention
24(a): Intervention of Right. Discover in certain situations in which persons who are not already parties may intervene an existing litigation. Upon timely application anyone shall be permitted to intervene in an action:
(1) when a statute of the United States confers an unconditional right to intervene.
Again, the existing parties may not want this person in the lawsuit because if they wanted him they would have joined him under the liberal Joinder rules. In civil rights cases the government reserves the right to intervene. Another example is when the Attorney General of the United States brings an action or injunctive release against people for violating the Fair Housing Act. If the government is doing that on behalf of the tenants who have been discriminated against, the statute specifically says that the tenants have the right to intervene in the lawsuit to recover their damages.
(2) when the applicant claims an interest relating to the property or transaction which is the subject of the action and the applicant is so situated that the disposition of the action may as a practical matter impair or impede the applicant's ability to protect that interest, unless the applicant's interest is adequately represented by existing parties.
There are three requirements and you must satisfy all three:
1. The intervener has a significant interest in the subject matter of the pending litigation;
2. A substantial risk that the litigation will impair the intervener’s interest; and
3. The existing parties do not adequately protect that interest.
24(b) Permissive intervention: A party is permitted to intervene (1) when a statute, an act of congress, confers a conditional right to intervene; or (2) when an applicant's claim or defense and the main action have a question of law or fact in common. The court has discretion to deny the motion for intervention. If the intervening party can meet the requirement which means that there is a common question of law and fact, the court has the discretion to deny the motion. They court will do so if allowing intervention would undue the delay or somehow prejudice the parties to the existing litigation. Sometimes an intervening parties situation is far more complicated than the existing case, the court may say no, bring your separate lawsuit.
If the intervener so predominates the litigation that it significantly shifts or upsets the roles of the existing parties, the court will often use that as a reason to deny the intervention. The court has the authority to attach conditions to a permissive intervention.
Example: If the court permits the intervention but that results in having to redo discovery, the court may condition the intervention on paying the cost for the duplication of the discovery. The courts have tremendous discretion here.
The rule doesn’t have the time limit but the court will take time into consideration in determining whether or not it’s an intervention whether it’s by right or by leave. What is the delay, what is the length of delay, did the intervening party know of the litigation, did they wait an excessive amount of time, etc.
The courts must have jurisdiction. Personal jurisdiction is usually not a problem because the intervener is obviously consenting to the jurisdiction. If the intervener’s claim destroys subject matter jurisdiction, the court can deny the motion.
Like the well pleaded complaint rule, the general rule is that courts simply don’t look at how the intervener pled the case. The court looks beyond how the case was drafted. The intervener might style herself as an intervening plaintiff and might even draft a complaint naming herself as a plaintiff and make allegations that conform with the allegations in the complaint. But if the court upon review determines that actually the person’s interests are aligned with the current defendant and are antagonistic to the plaintiff, the court will simply declare that she is an intervening defendant. You always have to ask the question of the intervener, are they a plaintiff or are they a defendant.
Natural Resources Defense Council v. United States Nuclear Regulatory Commission
10th Circuit, 1978
This was an appeal of a denial of a motion to intervene.
The Nuclear Regulatory Commission (D) is permitted by federal law to give the several states the power to grant licenses to operate nuclear power facilities. D is empowered to grant such licenses on the condition that it prepare an environmental impact statement. D entered into an agreement with the New Mexico Environmental Improvement Agency (NMEIA) permitting it to issue a license. NMEIA issued a license to United Nuclear without preparing an impact statement.
This environmental group is suing both the US Government and the New Mexico Government is seeking injunctive relief.
The day the lawsuit was filed, New Mexico issued a permit to United Nuclear. The American Mining Congress (a trade association) and Kerr-McGee wish to intervene. The trial court denies the motion to intervene. The reality is that these are two entirely independent organizations and certainly United Nuclear is not representing American Mining Congress or Kerr-McGee. When the court says their interests are adequately represented it means they are identical. Since their interests are identical it doesn’t help judicial economy to add parties who in effect are already represented. They lose on that point because
The Supreme Court has held that an interest must be a significantly protectable interest. Here the matter of the licenses is at issue. Kerr-McGee has one of the largest holdings of uranium properties in the state. A decision that favors P would no doubt have a profound effect on Kerr-McGee.
This court finds all three requirements of 24(a)(2) present. These interveners have rights that are not protected by other parties to the litigation. Those rights will be affected and they must be allowed to intervene. Reversed and remanded.
Martin v. Wilks
Supreme Court, 1989
1. Existing parties may join lawsuits
2. You can’t be bound by a judgment unless you were part of the lawsuit
3. Joinder is how people are bound to lawsuits
4. When in doubt read the rule
NATURE OF THE CASE: This was an appeal of an order reversing the dismissal of an action for reverse discrimination.
FACTS: Black firefighters brought a discrimination suit against the City of Birmingham, Alabama (D). It was settled by a consent decree; affirmative action programs were mandated. Several white firefighters, Martin (P), then sued under civil rights laws contending that the affirmative action programs constituted reverse discrimination as the promotions of the black firefighters were based on race. D defended on grounds that the consent judgment precluded P's suit. The district court dismissed P's suit; the prior judgment had a preclusive effect. The court of appeals reversed because Ps were not parties to the previous judgment. The Supreme Court granted review.
Some firefighters wanted to change the hiring practices of the city which they alleged was discriminatory and in violation of civil rights laws.
The original suit was resolved by a consent decree. The difference between a settlement agreement and a consent decree is a settlement agreement is simply private agreement between the parties. It’s a contract. It’s enforced according to the ordinary principals of contract law and if you were to look at the public record it wouldn’t say what the parties settled for or what the terms of the settlement were. A consent decree is different – it’s when the parties agree that the court may enter the order under the following lines and then it becomes a judgment. A settlement agreement is enforceable like an ordinary contract. A consent decree is enforceable as a judgment. When you get a judgment in a case you can’t file a law suit in the same case. You may not want a consent decree to keep it off of your record.
A consent decree gets entered in the 1970s. The union gets involved and they tried to intervene under Rule 24. The union should have been allowed to intervene. Of course the union has an interest, the rules on who gets promoted is about to change. Essentially they are saying, if you want to settle, you’ve got to bring everyone to the party. Unfortunately they wait too long and the court exercises its discretion to not let them intervene.
What happens next? The sought injunction claiming reverse discrimination and they try to get an injunction to prevent enforcement of these consent agreements and they lose that. Now we have the lawsuit that brings us here today.
What is the argument? What is the issue here? What’s their response? The defendants are saying this is a binding judgment. You can’t set aside the judgment. We have reached the consent, the appeal period has passed – you can’t set aside the judgment.
What’s your response if you are a white plaintiff? If you follow thru with this consent decree, if you conduct yourself in accordance with this consent decree, will violate the very same civil rights laws that you purport to be enforcing; therefore, we are suing you for the same reason the original lawsuit was filed – we want injunctive relief. The court is saying, if you wanted to intervene then why didn’t you? You knew about it, the union already tried to intervene but they were denied because they were untimely. There is no question that the white firefighters knew about the lawsuit and sat on the sidelines and chose not to do a thing. But they claim that they were not parties to the suit and that it’s not fair.
Now that the judgment is entered, now after 10 years of litigation (They settled it after the trial), now you guys come along and say that it’s not fair.
If I was one of the original parties to the suit I would be extremely annoyed that people just sat there and watched us spend all of our money, become emotionally exhausted and now that we finally come to a resolution then you come along and try and set it aside. I would be very upset. But at the same time I would be upset if my livelihood and my rights would be affected by some other people’s arguments that I couldn’t control.
The case ends up in front of the Supreme Court. One party says, if you are going to be affected, it’s your obligation to intervene. Another party says, no, if you are going to affect my rights it’s your obligation to sue me or join me under the Joinder rules. The issue before the Supreme Court was, whose obligation is it to walk down to the courthouse?
HOLDING AND DECISION: (Rehnquist, C.J.) Does a consent decree have a preclusive effect on persons who were not party to the prior action? No. Can a party seeking a judgment that binds nonparties obligate the nonparties to intervene in an action or must the party seeking the judgment mandatorily join the nonparties in the action? The latter is true. As a general rule of law, a party is not bound by a judgment in which he was not a party or was not made a party by service of process. A consent decree does not have a preclusive effect on persons who were not party to the prior action. No one is bound by a judgment in personam to which he was not a party.
This was a 5-4 decision – a close call.
How are we supposed to know whose rights get affected? What about a 10 year old kid who wants to become a firefighter? How are we supposed to identify him? It’s unreasonable to expect us to do that. That’s a good argument.
The other side of the argument is, how are you supposed to know who actually knows about lawsuit? Although these firefighters knew about the lawsuit it’s not always going to be that clear if they knew.
This case is all about reading the instructions. Justice Rehnquist says both of you guys have great arguments – let’s read the rules. There’s nothing in the rule that says that anybody with knowledge of a lawsuit, whose rights might be affected, is required to go down there and intervene. According to Rehnquist and the majority, the rule says existing parties may join parties. Sometimes they have to if it’s compulsory, sometimes they may if it’s permissive. But there is no way you can read this rule to say that somebody who is not a party, whose interest is going to be effected is required to join the lawsuit if they choose not to. When in doubt read the rules.
If somebody does not want to join and an existing party chooses to not join that party, then the existing party bears the risk. It’s a matter of who has to the shoulder the burden by making sure that all of the parties effectively do their job.
RULE OF LAW: “All agree that it is a principle of general application in Anglo-American jurisprudence that one is not bound by a judgment in personam in litigation in which he is not designated as a party, or to which he has not been made a party service of process.”
You can’t be bound by a judgment unless you were part of the lawsuit.
“Even if we were wholly persuaded by these arguments as a matter of policy, acceptance of them would require a rewriting, rather than an interpretation, of the relevant Rules.”
The Court decided to follow the rule as written.
POINTS OF LAW FROM CASE
Per Professor Benson:
1. A person cannot be bound to a judgment in litigation to which he or she is not a party;
2. A person is not required to intervene in a lawsuit in order to ensure that he or she is not bound by the judgment even if he or she is aware of the lawsuit and the possibility that the outcome would affect him or her;
3. Joinder as a party rather than knowledge of a lawsuit and an opportunity to intervene is the method by which potential parties are subject to the jurisdiction of a court and bound by a judgment or decree; and
4. The parties to a law suit presumably know better than anyone else the nature and scope of the relief sought in the action and at whose expense relief might be granted. It makes sense to place on them the burden of bringing in additional parties.
Not only as a policy matter, but according to the Rules as written, if an existing party wants to make sure a judgment or decree is binding on everyone, then it is their job to go out and find everybody who might be affected and start joining them. Joinder is how people are bound to lawsuits.
LEGAL ANALYSIS: This case was legislatively overruled by Congress in 1991 which prohibits challenges to consent decrees by individuals who had actual notice and a reasonable opportunity to intervene or whose interests were adequately represented. Even if a party’s interests are being decided in a lawsuit, that party is not obligated to intervene. The parties in a lawsuit may make the judgment binding on others by invoking mandatory joinder.
Congress’s clear intent in 1991 was to prevent strangers to prior Title VII litigation from collaterally attacking the final civil rights decrees and thereby delaying or preventing the implementation of Title VII remedies of employment discrimination cases.
Note 5(a), Page 784: After the 1991, no but after Wilks yes.
Note 5(b): The last thing you want is to join a party with their own ideas.
INTERPLEADER
Rule 22, Interpleader addresses the situation where the defendant in effect is not contesting liability. The problem is there are several claimants against the defendant. But what happens when the defendant says I know I owe somebody, but I just don’t know whom to pay. The classic example is life insurance policy. They owe $500,000 and there are 18 different claimants.
Why should the insurance company have to spend any money on litigation? The insurance company gives the money to the court and lets the court decide whom to give the money to. In view of the case we just read you can see why it is so important that everybody in the interest gets added. It is possible that sometimes the defendant also has a claim to the property.
1. A defendant can be another claimant to the very property with which he or she has possession.
2. Basically this rule allows the interpleader plaintiff (the person in possession of the property, money, etc.) to bring in and add as parties all claimants so that the court can sort through the various and competing claims and decide how it gets divided. There are two ways of accomplishing this. They are independent rules but they are made to complement each other. Rule 22 interpleader and statutory interpleader 28 USC 1335, 1397, and 2361 can be used sometimes in the same action but there are some subtle differences between the statute and the rule so you have to choose one over the other.
Basic requirements under both the Rule and the Statute:
The interpleader must plead claims that are independent of and at least partly inconsistent with one another. In other words, each claimant has to have an independent and inconsistent claim – not derivative claims.
Life Insurance Example: There are two claimants and each claimant is claiming that she is entitled to the entire proceeds – those claims are inconsistent, you cannot satisfy both.
The Stakeholder is the person in possession of property (Like a life insurance company). Sometimes the stakeholder has already been sued by one claimant, which is fairly common. If that happens, you file a counterclaim against the plaintiff and demand interpleader and then add all of the competing claimants to the property.
Rule 22:
The differences between Rule 22 and the statutory ones are mostly jurisdictional. Rule 22 is harder to get jurisdiction then the statutes. Basically Rule 22 requires normal jurisdictional requirements. In other words the court must have subject matter jurisdiction thru either federal question or diversity. But here’s the twist: under Rule 22 you cannot have supplemental jurisdiction; therefore, all claimants must have jurisdiction. You cannot thru supplemental jurisdiction entertain a jurisdictionally insufficient claim under Rule 22. With respect to diversity, under Rule 22 the citizenship of the stakeholder must be diverse from that of all the claimants. The claimants don’t have to be diverse from one another, but the stakeholder must be diverse from all the claimants. Each claimant’s claim must exceed $75,000 (because there is no supplemental jurisdiction). You must establish personal jurisdiction over each claimant and you do that by using the International Shoe Contacts Test. You must establish venue over each claimant pursuant to the venue statute. Rule 22 has pretty high standards.
The Statutes:
The statute is a little easier to meet. Under the statute the amount in controversy is much lower – each claimant must claim at least $500. If one claimant is diverse from the stakeholder, that is sufficient to establish diversity of citizenship. Section 2361 provides for a nationwide personal jurisdiction and service of process meaning you do not have to establish minimum contacts in the forum jurisdiction. If you serve anybody in the country, that court has personal jurisdiction over that person. Statutory interpleader is much easier. The statute authorizes federal judge to in effect stay proceedings. If the claimant files a separate action in state court, under the statute the Federal Court has the authority to stay any additional proceedings in either state court or Federal Court and in effect make all disputes under the same litigation.
Under the statutory interpleader the stakeholder is required to deposit the “stake” with the court. If it’s money, they have to deposit it with the court. All courts have bank accounts for this sort of thing.
Insurance Interpleader Example: When a person with a small auto insurance policy injures many people, the insurance company admits liability and divides the money amongst them. The insurance company will only have to pay out X amount but their duty to defend it limitless. The insurance company will sue all of the injured people and deposit the money with the court.
Cohen v. The Republic of the Philippines
146 F.R.D.
NATURE OF THE CASE: This was an interpleader action and a motion to intervene.
FACTS: Cohen (P) received paintings on consignment from Braemer who was an agent for Marcos entrusted to run her New York home. Breamer demanded the return of the paintings in 1992 and P refused because he was uncertain as to the true owner. P then brought an interpleader action against Braemer and the Philippines. Braemer claims that the paintings were collateral for loans made by him to Marcos. The Philippines claimed that the paintings belonged to them and that they were acquired with government funds which Marcos and her husband illegally obtained during the husband's tenure as President. Marcos now seeks to intervene in the action claiming that the paintings were acquired from her personal funds. The four paintings totaled nearly $5 million in value. Marcos denies any kind of lien or security interest on the paintings or in the alternative she claims a right to the paintings after payment to any amounts that might be due Braemer.
Consignment is having possession of something to sell while the owner retains title. The consignor becomes a bailee.
If Marcos doesn’t intervene she won’t necessarily lose all of her rights to the paintings but as a practical matter she might have a problem tracking down the paintings because once they are gone, they could be gone forever.
Cohen should have joined her initially – it would’ve solved a lot of problems. She does have interest in property. Marcos waited 5 months after the initial complaint was failed to intervene. Although she was involved in other legal matters, the court excused her untimelyness because it wouldn’t result in any prejudice to the other parties.
The interest has to contrary to the other claimants – it has to be inconsistent. One party can’t claim half and another claim half as well. If that’s the case then you don’t have interpleader; you just divide up the property. It has to be claims that cannot be resolved. They have to be competing and contrary interests. .
In regards to prejudice and lack of adequate representation, Marcos’s interest may be impaired by the action and is not adequately protected by the existing parties.
CLASS ACTIONS
Up until now we have been operating under the principal that no person can be bound by a judgment unless he or she were a part of the underlying litigation either as a plaintiff, a defendant, an intervener or someone joined pursuant to the Joinder rules. Class actions is one of the two exceptions we discussed when we looked at the Wilks case. Parties who are brought in the suit by joinder all share in active participation in the suit. You can’t settle the case unless everybody agrees. Everyone joined has the right to bring their attorney, engage in discovery, ask questions at trial, call witnesses during trial, etc. They are all active parties no matter how many there are, no matter what their interests may be.
The modern rules of civil procedure have gotten very good at consolidating litigation and they do it in a number of ways:
Mass torts example: Hotel fire in Puerto Rico. Professor Benson represented a company that manufactured packing material and that packaging material was covering unpacked furniture in the basement. It was alleged that the packaging material released toxic fumes which led to the deaths of some of the 250 people who died in the hotel fire. They used a standard of care argument. Because you can’t have 250 lawyers arguing the case the court appointed committees i.e. a discovery committee, a motion committee, etc.
Class Action has been around for a number of years. It originally was an equitable concept that came out of the courts of chancery and not out of the common law courts.
A Class Action allows adjudication of additional claims without having to actually enlarge the original number of plaintiffs.
Example: If 4 people file a lawsuit and if they can get the class “certified” – and there might 30,000 other people similarly situated – Class Action lets the court adjudicate all 30,000 issues without having to enlarge the original 4 plaintiffs. The original 4 plaintiffs are the only ones doing discovery, going to court, arguing motions, trying the case, calling witnesses, etc.
The whole thing about a Class Action is that you are limiting the number of participants. You can have all sorts of people who are parties and potentially bound by the judgment but you have severely limited how many people can participate in the actual trial of the case. Class members are bound by the outcome of the case but only their class representatives actually participate in it; they are in other words passive litigants without any say as to what goes on.
This of course raises due process problems and Constitutional issues. This is a rule that permits people who did not participate in the lawsuit to be bound by the judgment of the lawsuit and in some cases not even acknowledge that there was such a lawsuit.
The Class Action device or the rules we are going to look at gets around these constitutional problems by being very rigorous. Courts are extremely careful to follow the Class Action rules because if they stray from the rules or read the rules a little to liberally or broadly they run the risk of violating people’s constitutional rights. You have to exactly fit in to the requirements otherwise the court will not permit the certification of the class for fear of inadvertently violating people’s rights.
The requirements are simply to ensure that the passive class member’s interests are adequately represented by the active participants. All the rules we are going to look at come back to that point – are the passive class member’s interests being properly and aggressively and actually represented by the representative members – those members who are actively participating in the suit.
Most Federal Class Action suits are governed by Rule 23. The plaintiff is usually the class representative. The plaintiff usually pleads the individual claim – in other words, Claim 1: I’ve been injured and here’s how. Count 2: The plaintiff pleads the existence of a class and then requests the court to certify his or her claim on behalf of the rest of the class. In almost every Class Action the class is plaintiffs. It is possible to have a defense Class Action but it is rare.
Rule 23
Every proposed class must conform to 4 requirements under subsection (a) Under subsection (b) they have to fit into the categories of (b). There are 2 common law requirements that are not expressly stated in the Rule.
Common Law Requirements:
1. The class must be capable of definition. It must describe a group that genuinely exists – not a hypothetical group. It must do so with enough clarity so that the court can determine with confidence who is and who is not a member of the class. It has to be a little clearer that “those of us who like to ride bikes and not get hassled by the cops.”
2. The representative member must be a member of a class. Example: In my town there might be a genuine class of people being ripped off and in order to right the wrong, I want to file a Class Action on behalf of these people. I can’t do that because I have to be a member of the class. Article III of the Constitution – the court will only resolve an actual case in controversy. If I don’t have a case, I don’t have a controversy; therefore, I don’t have standing and no Article III jurisdiction.
Rule 23(a). Prerequisites to a Class Action
One or more members of a class may sue or be sued as representative parties on behalf of all only if:
(1) Numerosity. The class is so numerous that joinder of all members is impracticable. It’s a case by case basis and different districts have different attitudes and different judges have different attitudes but it has to be impracticable.
(2) Commonality. There are questions of law or fact common to the class. There must be a common fact or question of law among the class members that relate to the matter litigated. The common questions must predominate. What that means is, just the fact that some class members have individual issues that are not necessarily shared by other members will not automatically void the possibility of a Class Action so long as the common question predominates the Class. Different Class members might have different damages or different amounts that are owed them and that alone will not destroy certification. The test of commonality is not exacting.
(3) Typicality. The claims or defenses of the representative parties are typical of the claims or defenses of the class. This focuses on the representative Class members. The named parties must have the same issue as the Class members. Their claim must be typical of all of the claims of the Class as a whole and not merely a portion of the Class. This actually comes up a lot. The claims must be typical of everyone in the Class, not most everyone in the Class. As a practical matter the representative party must stand in the shoes of each Class member. The Constitutional requirement is that you cannot bind somebody to a suit unless those absent class members’ interests are adequately represented. They can’t be adequately represented unless the main plaintiffs have the same motivation and desire to win basically. The only way to be assured of that is if the Class members have the same claim as I do. Their strategy would be the same as my strategy.
(4) Adequacy of Representation. The representative parties will fairly and adequately protect the interests of the class. Can these people shoulder the burden? One thing the court looks for is conflicting claims between the Class members and the Class. If in fact the court finds that there are no conflicts, the court is going to inquire about how much money they have. Can they sustain the expense of a litigation that might take years? The court will inquire as to how many lawyers can devote their time to the Class at the risk of losing other clients. It doesn’t matter how intelligent or skilled you are, the court is going to ask you how you are going to handle the case. The court will also inquire the plaintiffs on how dedicated they are and how much they want to see this thru. All of the Class members whether they know about the suit or not are relying on the representative class members to do a really, really good job.
Rule 23(b) Class Actions Maintainable/Types of Class Actions
(b)(1)(A) The Class will be certified if the opposing party will otherwise be at risk of being subjected to incompatible duties. The focus of this subsection is not on the Class but on the opponent of the Class. They are trying to protect the opponent from having inconsistent obligations. Example: If the Class is only some employees and not other employees, are you going to run into a Wilks situation?
(b)(1)(B) Risk of practical impairment. Courts are always very concerned about inconsistent judgments arising from the same transactions or same set of facts. To the extent that the courts can avoid inconsistent judgments by having consistent judgments – that mitigates in favor of Class Action certification. This focus is on the Class members. Will many of the Class members suffer an injustice because they simply cannot afford to bring a separate lawsuit? What injustice will the putative Class members suffer if it’s not certified as a Class
(b)(2) Injunctive of Declaratory Relief, not money damages. Two requirements: (1) The Class must share a general claim against the non-Class party; and (2) The Class must seek primarily injunctive relief. Seeking money damages is not automatically prohibited under this but it must be secondary to the injunctive relief. As in the Wilks case the primary focus was injunctive relief.
(b)(3) Predominance of Common or Legal Factual Question. This is a catch-all category. If they don’t precisely fit in 1 or 2 then you look at 3. This is the so called opt-out Class. Class members must be given opportunity to opt-out of the Class if they choose. The court can certify under subsection 3 of 23(b) if two requirements are met: (1) The common issues must predominate over individual interests. The common question is what the court scrutinizes over anything. (2) The Class Action is a superior means of adjudicating the dispute.
(c) The court must provide at an early practical time to determine whether to certify the action as a Class Action. It permits but it does not require that the court direct notice to Class members in Classes certified under (b)(1) or (b)(2). It does require that notice be given to Class members found in (b)(3). The rule expressly lists the information the notice must contain:
the nature of the action,
the definition of the class certified,
the class claims, issues, or defenses,
that a class member may enter an appearance through counsel if the member so desires,
that the court will exclude from the class any member who requests exclusion, stating when and how members may elect to be excluded, and
the binding effect of a class judgment on class members under Rule 23(c)(3).
(e) Approval of Settlements and Voluntary Dismissal. The court must approve any settlement or any voluntary dismissal. The court must conduct a “fairness hearing”. The purpose of the hearing is to ensure that the settlement or voluntary dismissal that will bind class members is fair, reasonable, and adequate. You cannot settle the case until the court agrees to the settlement.
(f) Appeals. An Interlocutory Appeal is special Appellate Rule which is an appeal you bring before the case is resolved. In the federal system this is very rare and has a very rigid requirement. The court may exercise its discretion not to hear the appeal. There is no automatic stay and the case will continue on while the appeal is pending unless you can convince the district judge to stay proceedings pending the appeal. It mostly depends on whether or not the judge thinks you can win the appeal.
(g) Class Counsel. The courts do scrutinize the lawyers. They look at Class counsel. This gives the court guidance in determining counsel’s ability.
(g)(1)(A) The court must consider:
the work counsel has done in identifying or investigating potential claims in the action,
counsel's experience in handling class actions, other complex litigation, and claims of the type asserted in the action,
counsel's knowledge of the applicable law, and
the resources counsel will commit to representing the class;
(ii) may consider any other matter pertinent to counsel's ability to fairly and adequately represent the interests of the class;
(iii) may direct potential class counsel to provide information on any subject pertinent to the appointment and to propose terms for attorney fees and nontaxable costs; and
(iv) may make further orders in connection with the appointment.
I can’t emphasize enough the problems created by lawyers who suddenly lose it in the middle of litigation. The court at the vary outset wants to make sure that they have a good, solid, legal counsel whose going to be able to see the case through. A case may last 10 years so it is not to be taken lightly.
Page 795, Notes and Problems:
1. (a) She is not a member of the Class pursuant to the Common Law rules.
(b) The court is going to ask: who is your lawyer, how much experience, etc.
(c) Subsection (b) injunctive relief.
2. (a) Some members are benefited greatly. It doesn’t do anything for the students already paid. The problem with the settlement is now you are pitting class members against the other class members.
(b) They got to go to 23(b)(3) because the money damages predominate over the injunctive relief and money damages. What does that do to the case? It changes the rules for notice. You now have to provide each class member with notice and opt-out instructions where you didn’t have to before.
(c) The court was fine when it was under subsection 2. Now that it is under subsection 3 you have to give notice. Notice requirements have to be mailed out first class and that adds up fast.
Communities for Equity v. Michigan High School Athletic Assn.
US District Court, W.D. Mich., 1999
FACTS: Plaintiffs alleged that they have been excluded from interscholastic athletic programs and have received unequal treatment and benefits from the programs. They contend that this constituted gender discrimination in violation of Title IX of the Education Amendments of 1972, is against Equal Protection under the 14th Amendment, and a violation of Michigan state laws. They allege a large number of discriminatory acts. Plaintiffs filed a motion before the court for class certification; all present and future female students enrolled in MHSAA member schools who participate in interscholastic athletics or who are deterred from participating in interscholastic athletics because of defendant’s discriminatory conduct.
Boys football dominates everything. It sucks up all the money. The girls sports gets shorted because they are always working around boys football or boys basketball. Title IX basically says that everything has to be fair and equal.
Rule 23(a)(1) Numerosity is satisfied as it would be too impractical for thousands of girls to bring this lawsuit. So it was easy. So class certified.
Rule 23(a)(2) Commonality: Here the court basically says it’s one discrimination. It affects a bunch of different girls and a bunch of different sports but it is one discrimination against Title IX. It creates a common violation even though you are talking about different sports.
Rule 23(a)(3) Typicality: The variety of alleged manifestations of discrimination present a sufficient case of an underlying policy of practice of discrimination.
Rule 23(a)(4) Adequacy of Representation. It is required that class members and their counsel be prepared to provide fair and adequate representation to the class. The defendants insist that 80% of the class like the status quo. Judge Enslen basically says I don’t care; you can’t consent to having your civil rights violated. Adequacy of representation is also measured by the quality of class counsel and there was no question here that plaintiff’s attorney was qualified.
Rule 23(b)(2) Injunctive Relief. Injunctive relief is, of course, an appropriate remedy for discriminatory treatment. Motion for Class Certification shall be granted.
Historically what these rules did was merge law with equity. Around the 1840s starting in New York, and followed by the federal system in the 1930s, courts decided to abandon altogether the common law pleadings and adopted equitable pleadings and in the process merged law and equity. The rules of civil procedure represent a triumph of the equitable pleadings over the common law pleadings.
One of the most important parts of equitable pleadings was the concept of Joinder. Liberal Joinder: join as many parties that have an interest in the litigation and assert as many claims and theories against as many parties as the circumstances may allow.
Rule 18. Joinder of Claims and Remedies
(a) Joinder of Claims.
A party asserting a claim to relief as an original claim, counterclaim, cross-claim, or third-party claim, may join, either as independent or as alternate claims, as many claims – legal, equitable, or maritime, as the party has against an opposing party.
Again, this is so ingrained in our jurisdictions, we don’t think anything about it. One hundred years ago this would have been considered extremely radical.
This allows claimants to bring all claims they may have against the person already a party to the case even if the claims are not related to one another. This promotes judicial efficiency.
Every joinder rule is subject to the other procedural rules, most notably: subject matter jurisdiction, personal jurisdiction, and Venue.
The Supreme Court is careful to not overstep its bounds. Jurisdiction is limited by that specific authority granted either by the Constitution or by congress. If there is no specific grant of authority the Federal Courts do not act. Remember, absent jurisdiction the courts will not act. So, every Joinder rule and every person before the court must satisfy subject matter jurisdiction and personal jurisdiction.
Rule 13. Counterclaim and Cross-Claim
(a) Compulsory Counterclaims.
A Compulsory Counterclaim arises from the same transaction or occurrence that led to the plaintiff’s complaint against the defendant. The important thing is: if the defendant doesn’t bring the compulsory claim, then it is waived and the defendant is forever barred from asserting that claim against the plaintiff.
Some exceptions to the nature of a compulsory counterclaim is even if the claim arises from the same transaction or occurrence it is not compulsory if the counterclaim requires Joinder of some additional party who is not subject to the court’s jurisdiction. A compulsory counterclaim is not required if there is a pending action.
Example: Let’s say that the defendant already has an action pending against the plaintiff in state court and the plaintiff sues in Federal Court, the defendant is not required to bring the counterclaim if the defendant already has a state claim pending. So, if there is another case pending then it’s not a compulsory claim anymore.
Finally, if the claim is immature or in other words, at the time that the original complaint is brought, the defendant’s counterclaim has not yet matured.
(b) Permissive Counterclaims.
Permissive counterclaims are counterclaims that do not arise out of the same transaction or occurrence. The defendant in such a case has a choice to either bring the counterclaim or file a separate lawsuit. With a permissive counterclaim you often have jurisdictional issues because by definition supplemental jurisdiction is not going to apply because it did not arise out of the same transaction or occurrence. A permissive counterclaim has to satisfy subject matter jurisdiction and personal jurisdiction.
(g) Cross-Claim Against Co-Party
A cross-claim is filed against a person who had not until the claim has been filed, been an opponent to the party filing it.
Example: Plaintiff v. two defendants when one defendant brings a claim against another defendant.
It is always permissive, never compulsory. It must also meet the requirements of subject matter jurisdiction. Subject matter jurisdiction is not a problem because by definition it arises out of the same transaction or occurrence. You must also meet personal jurisdiction. That usually is not a problem because the court has acquired jurisdiction over both defendants because otherwise one of them would have been dismissed before you brought the cross-claim.
Rule 20. Permissive Joinder of Parties
(a) Permissive Joinder.
A person joins as either as plaintiff or defendant. He or she must have claims that arise out of the same transaction or occurrence or a series of transactions or occurrences. All parties joined must have common at least one question of law or fact.
Rule 14. Impleader.
Impleader is when a defendant brings a third-party action against somebody who is not a currently a defendant. The limitation on this rule is that the Third-Party Plaintiff who brings the Third-Party action alleges that the liability is derivative meaning: that if I am liable to the plaintiff, then you liable to me. The defendant cannot say, it’s not my fault I am not liable, it’s your fault you are liable. That is not a derivative claim. How do you determine what is a derivative claim? In a diversity case it depends upon the substantive law of the state in which the case is filed.
28 U.S.C. 1367. Supplemental Jurisdiction.
The Three Step Process to determine whether supplemental jurisdiction exists:
Step 1, 1367(a):
You must have an anchor claim which is a jurisdictionally sufficient claim. The jurisdictionally insufficient claim must arise out of the same common nucleus of operative facts as the anchor claim.
If that exists, you move to Step 2.
Step 2, 1367(b):
1367(b) operates to preclude the exercise of supplemental jurisdiction when all four of the following requirements are met:
1. Diversity of citizenship;
2 Jurisdictionally insufficient claim is brought by a plaintiff;
3. The jurisdictionally insufficient claim is brought against parties joined under rules 19, 20, 14 or 24; and
4. Exercising jurisdiction over the supplemental claim will destroy diversity.
If Step 2 does not preclude the exercise of supplemental jurisdiction you then proceed to Step 3.
Step 3, 1367(c):
The discretionary factors:
1. Should the Federal Court, who now has the power to entertain the jurisdictionally insufficient claim, exercise its power, the rule instructs the judges that they should not exercise the power if the supplemental claim raises novel or complex issues of state law or the supplemental claim substantially predominates over the federal claim.
2. The court has already dismissed the federal claims leaving nothing but the supplemental claims
3. The catch all – for all other compelling reasons.
Exxon v. Allapattah v. Star-Kist Foods
Supreme Court, 2005
In No. 04—70, Exxon dealers filed a class action against Exxon Corporation, invoking the Federal District Court’s 28 U.S.C. § 1332(a) diversity jurisdiction. After the dealers won a jury verdict, the court certified the case for interlocutory review on the question whether it had properly exercised §1367 supplemental jurisdiction over the claims of class members who had not met §1332(a)’s minimum amount-in-controversy requirement. The Eleventh Circuit upheld this extension of supplemental jurisdiction. In No. 04—79, a girl and her family sought damages from Star-Kist Foods, Inc., in a diversity action. The District Court granted Star-Kist summary judgment, finding that none of the plaintiffs had met the amount-in-controversy requirement. The First Circuit ruled that the girl, but not her family, had alleged the requisite amount, and then held that supplemental jurisdiction over the family’s claims was improper because original jurisdiction is lacking in a diversity case if one plaintiff fails to satisfy the amount-in-controversy requirement.
Held: Where the other elements of jurisdiction are present and at least one named plaintiff in the action satisfies §1332(a)’s amount-in-controversy requirement, §1367 authorizes supplemental jurisdiction over the claims of other plaintiffs in the same Article III case or controversy, even if those claims are for less than the requisite amount. Pp. 4—25.
In this case there was a conflict among the circuits. One circuit said that each member does not have to meet the jurisdiction requirement and therefore they can all be part of the suit under the supplemental jurisdiction statute. In the Star-Kist case the court said no, you must so the Supreme Court took both cases to resolve the conflict.
At the end of the day, the court held in favor of Exxon Mobil. In Exxon they said that as long as one plaintiff meets the jurisdictional limit, all the other plaintiffs can thru supplemental jurisdiction remain in the suit. In Star-Kist the court said no, if one plaintiff meets the jurisdiction that plaintiff could stay but all the other plaintiffs have to be dismissed.
When a well-pleaded complaint has at least one claim satisfying the amount-in-controversy requirement, and there are no other relevant jurisdictional defects, the district court, beyond all question, has original jurisdiction over that claim. A court with original jurisdiction over a single claim in the complaint has original jurisdiction over a “civil action” under §1367(a), even if that action comprises fewer claims than were included in the complaint. Once a court has original jurisdiction over the action, it can then decide whether it has a constitutional and statutory basis for exercising supplemental jurisdiction over other claims in the action. Section 1367(b), which contains exceptions to §1367(a)’s broad rule, does not withdraw supplemental jurisdiction over the claims of the additional parties here. In fact, its exceptions support this Court’s conclusion. Pp. 11—13.
The controversy here
This was a 5-4 decision and the Court was quite split on this issue. Justice Kennedy wrote the majority and Justice Ginsberg wrote the dissent.
They justices are just looking at Section 1367 which created supplemental jurisdiction. Part of the reason why this case is cited a lot has nothing to do with the procedural aspect of it but it was Kennedy’s assertion that the statute is not ambiguous. When a statute is not ambiguous you simply the statute as written. If it’s ambiguous you have to draw from other legislative history. Justice Ginsberg looked at legislative history and said, it’s pretty obvious Congress did not intend as radical a change as the majority was proposing. Up until this statute was enacted, there were two things that you had to have for diversity jurisdiction – 1) Complete diversity; and 2) The claim had to meet the jurisdictional limit. According to Ginsberg, the congressional history of this didn’t at all indicate that they intended to change the fundamental concepts.
The interesting thing about the fundamental concepts is this:
Complete diversity and all plaintiffs must meet the jurisdictional limit. Those two concepts are judicially created. The US Constitution Article III simply says that the court will have jurisdiction over citizens from different states. It doesn’t say that every single plaintiff must be diverse from every single defendant.
When Congress enacted the Judiciary Act of 1780, which was one of the first acts to be created, they created diversity. The diversity statute which reads very similar to the way it reads to day simply says the Court has jurisdiction over citizens of different states. In the 1800’s Justice Marshall said that requires complete diversity even though the Constitution doesn’t really say that nor does the statute really say that. But since Congress has amended the statute dozens of times over the last 200 years and has not changed it, the Court correctly assumes that Congress likes the decision.
There is nothing in the Constitution that even provides for a minimal jurisdictional limit but what Congress did is say the claim had to be in excess of a certain amount. It does not say that every single plaintiff has to meet that – that’s a judicially created factor. Here the Supreme Court comes along and what Justice Kennedy does is he changes that doctrine. What Ginsberg objects to is, this has been a long standing rule and that rule has been standing for literally hundreds of years. There is no indication that Congress intended such a radical change and she says it’s very disruptive.
On legislative history Justice Kennedy said it’s like looking out into a crowd and picking out your friends. In other words if there is a lot of history you can take bits and pieces of it to support your argument and brush under the rug those things that don’t support your argument.
Congress makes laws and if the Supreme Court interprets a congressional law, the interpretation becomes the law. What is to prevent an unelected staff member from literally falsifying the history and putting it in record? If the Supreme Court picks up the false memo, he or she could change the law of the entire nation and Kennedy points that out. Legislative history is not reliable.
What is the Exxon rule? At least one plaintiff must meet the minimum amount of controversy for any joinder. So long as one plaintiff meets the jurisdictional limit, all the other plaintiffs can, under the supplemental jurisdiction statute, remain in the case.
If the court is willing to basically disregard this judicially created doctrine that every plaintiff must meet the jurisdictional limit (Kennedy just tosses that out the window), why doesn’t he also toss out that judicially created concept? Why don’t they just say, for that matter, they don’t even have to be diverse? That issue is not before the court in this case but in theory what is to prevent the court from doing that in the future? Justice Kennedy addresses that by saying even though the Constitution doesn’t mandate complete diversity; the underlying policy was a citizen of New York could not get justice in a court in Virginia. If there are parties from the same states that reduces that risk. So the policy of keeping complete diversity is still a very important but the policy that each party has to meet the minimal jurisdiction doesn’t really have any constitutional implications. That limit is not even in the Constitution, Congress simply created that in order to reduce the workload of the Federal Courts.
Rule 19. Joinder of Persons Needed for Just Adjudication (Compulsory Joinder Rule)
Rule 19 basically involves bringing a person kicking and screaming into the courtroom because that person doesn’t necessarily want to be in the courtroom. The court orders that person in the lawsuit because that person is necessary to the lawsuit. Even if the existing parties don’t want that person in the suit, under Rule 19, if the provisions are met the court must add the parties.
A three-step analysis:
Step 1: When it is necessary to add a party;
Step 2: When it’s feasible to add a party; and
Step 3: Determine whether the party is indispensable.
STEP 1: NECESSARY PARTIES
When is a party necessary? Factors to consider:
Factor 1: If complete relief cannot be granted to those already parties in the absence of a person proposed to be joined under Rule 19.
Example: A beneficiary to a life insurance policy. $100,000 is left to five children and a dispute arises over who gets the money. Three children file a lawsuit and two of them do not. Can the court make that determination without affecting the two absent children? No.
Lawsuits involving in real estate:
Example: A cottage was left to five children. Five children are on a deed but only four are in the lawsuit. A court cannot reform a deed. That fifth person has to be in the lawsuit and that is a true definition of a necessary party. Otherwise the decree would be useless because it wouldn’t be binding on one of the persons on the deed.
Factor 2: The court may order Joinder of a non-party who has a significant interest in the subject matter of the litigation and whose interest may be imparity or legally in the absence of Joinder. (Life insurance policies)
Factor 3: The non-party has significant interest in the subject matter of the litigation and the existing parties may be subject to liability or inconsistent obligations in absence of the non-party (Overlapping interest).
Example: Let’s say there is a car accident and two people injured. The driver who caused the accident is insolvent with a $20,000 policy. One person files a lawsuit and sues for $100,000. The pool of money is only $20,000. There is another party who has a significant interest because they too were injured in the accident. The insurance company for the driver is concerned that if they pay the $20,000 by way of settlement and are sued by the other driver, it might face multiple parties and multiple liabilities. The insurance company has two choices: 1) they can implead; or 2) they can simply move to join the other injured party and make sure that everyone who has an interest in this $20,000 is a party to the lawsuit. Those are things they consider to determine if it’s necessary. What impact it would have on the case.
STEP 2: FEASIBILITY
Is it feasible to add these parties?
Under Rule 19(b), if the absentee party is found to be necessary under 19(a), the person must be joined if feasible. This is not discretionary. If the court determines that a party is necessary and if it is feasible they must be joined – it is mandatory. What is feasible? Feasibility is directly tied to jurisdiction. It must be determined whether a court can acquire personal jurisdiction over the absent party. If there is no personal jurisdiction, then obviously it is not feasible to add that party. If adding that party would destroy subject matter jurisdiction it’s not feasible to add that party. If the court can acquire personal jurisdiction over the necessary party and if adding that necessary party will not destroy subject matter jurisdiction, the court has no discretion it must add that party if the court has determined that party to be necessary.
In contrast, if the court cannot obtain personal jurisdiction over that party or it would destroy subject matter jurisdiction, then the court has to proceed to Step 3 and ask if the party is indispensable.
STEP 3: INDISPENSABLE PARTIES
Is the party indispensable?
If it turns out the party is indispensable, the court must dismiss the case. In contrast, if the necessary party is not indispensable the court can proceed. What the courts look at for indispensability:
The court shall determine whether in equity and good conscience the action should proceed among the parties before it, or should it be dismissed, the absent person being thus regarded as indispensable. The factors to be considered by the court include: first, to what extent a judgment rendered in the person's absence might be prejudicial to the person or those already parties; second, the extent to which, by protective provisions in the judgment, by the shaping of relief, or other measures, the prejudice can be lessened or avoided; third, whether a judgment rendered in the person's absence will be adequate; fourth, whether the plaintiff will have an adequate remedy if the action is dismissed for nonjoinder.
Now the court has to determine whether to dismiss the lawsuit. What adverse consequences are there? The court has the power to fashion its own remedy. The looks at rendering its judgment in such a way to minimize the effects it may have. The judge will often ask, if we are wasting or time or can’t this be filed in state court? If a federal judge determines there is an adequate forum out there, then the court is much more comfortable dismissing the case. Finally, the court will look at if the judgment that I render is going to be so inadequate because of that extra person out there that the extra person will still be able to file a lawsuit in state court and multiplying the litigation, the court is more likely to dismiss it in that case because it simply can’t fashion a remedy that’s going to avoid that kind of multiple litigation.
THE PROCEDURE:
When you file a motion to dismiss, you will file a 12(b)(7) motion to dismiss (lack of an indispensable party). Rule 19 however does not have a specific time limit so the court can deny a motion on untimelyness. The court basically has four options:
1. The court could simply determine that the party is not a necessary party and deny the motion;
2. The court could determine that the absent party is necessary;
3. The court might find that the person is necessary but joinder is not feasible, but that person’s presence is not indispensable and therefore deny the motion; and
4. The court could find that the non-party is necessary and indispensable in which case the court must grant a motion to dismiss.
Temple v. Synthes Corp.
Supreme Court, 1990
This was an appeal of a dismissal in an action for damages for products liability, medical malpractice, and negligence. The dismissal was for a failure to join a necessary party.
FACTS: An implanted plate and screw in Temple's (P) back malfunctioned. P underwent surgery wherein the plate and screw were inserted into P's spine. The screws broke off inside P's spine. P sued Synthes (D), the manufacturer of the plate and screw, for products liability in federal court based upon diversity.
The defendant files a 12(b)(7) motion and the district court agrees with the defendant. Among the options, that procedure is both common and appropriate. The court in this case talks about judicial economy.
The court gave P twenty days to join the necessary parties in the interests of judicial economy. P did not join the doctor and the hospital and the court dismissed the suit with prejudice. The court of appeals affirmed that decision: Fed. R. Civ. P 19 allows mandatory joinder of necessary parties in the interest of efficiency. It was stated that D might claim that the doctor and the hospital were negligent and the device was not defective, and on the other hand, the doctor and the hospital would claim that they were not negligent and that the device was defective. P appealed; joint tortfeasors are not indispensable parties under Rule 19(b).
Temple appealed and the 5th Circuit affirmed. The problem is that it has nothing to do with Rule 19. The judge can’t think that it’s judicially more economic to join the other parties because it’s what congress thinks that is important. The 5th basically said that these defenses are joined. The doctor was saying that the manufacturer screwed up, the manufacturer says it was the doctor, so their defenses are intricately linked and therefore the doctor and the hospital are necessary parties necessary to the manufacturer.
Per curiam: by the court. No one justice authored the opinion. It is such a no brainer, they just issue a brief statement by the court to reverse.
The Analysis:
Can the plaintiff get complete relief against the manufacturer without the doctor and the hospital? Yes, thru joint and several liability so long as they don’t double dip. They don’t even get past step one. This is the nature of the federal system.
Would any of the existing parties be subject to multiple or inconsistent judgments? No, the doctor and the hospital aren’t going to be bound by anything that happens in federal court and the manufacturer is not going to be bound by anything in state court. Under joint and several liability you can only collect the amount of the judgment. Joint tortfeasors are not always necessary parties under Rule 19.
Helzberg’s Diamond Shops v. Valley West Des Moines Shopping Center
8th Circuit, 1977
This was an appeal from a denial of a motion to dismiss for failure to join an indispensable party under Rule 19.
FACTS: Helzberg's (P), a jewelry store, leased space in Valley West's (D) shopping center. The lease agreement provided that no more than one other similar store would be allowed to rent space in the mall. D leased space to a third jewelry store called Lord's. Lord's lease allowed them to be a retail specialty jewelry store and not as a catalogue or full line jewelry store as was called for in P's lease as well as the restrictions with P's lease. Despite these semantics, Lord's intended to open a full line jewelry store. P sued for injunctive relief. P sued in federal District Court under 28 USC 1332 based upon diversity of citizenship between the parties and an amount in controversy of more than $10,000. P served D pursuant to a Missouri long arm statute. D moved to dismiss under Rule 19 on the ground that Lord's was not joined and was an indispensable party. P sued in district court in Missouri and could not obtain personal jurisdiction over Lord's, which had no Missouri contacts. The court enjoined D from breaching the lease and denied D's motion, and D appealed.
Step 1: Under Rule 19 is Lord’s is a necessary party?
Step 2: Is Lord’s feasible? Does it destroy subject matter jurisdiction or personal jurisdiction?
Step 3: Is Lord’s an indispensable party?
We have necessary and not feasible because there is no PJ over Lord’s. If the party is necessary you have to add feasible. If it’s not feasible then the court has to determine whether a party is indispensable. That’s the question presented here. If I’m the judge, do I dismiss or not? If the party is indispensable I dismiss.
The court looked at obvious prejudice to Lord’s to determine whether it was dispensable or not. The court said that these were separate agreements and that by granting the injunction affects the other. Lord’s still had rights under the second agreement – they can sue for breach of contract to enforce their agreement with the property and therefore they are not indispensable. When Valley West complained they were saying that they might be subject to multiple lawsuits. The court said whose fault is that? You guys are the ones who signed two separate agreements. Valley West’s argument is that they never breached the contract and the contracts are consistent with one another. Benson: The judge dismisses that and in effect decides the case making it unfair. I don’t like this decision.
If it’s necessary and feasible, you must join the party. It’s only when it’s not feasible to you move to Step 3.
If 1 and 2 is true, you stop right there. If 1 is true but 2 is not feasible you move to 3.
Hypos on Page 772:
a. Lets remember the three step analysis: Whether those parties are necessary and then is it feasible and then indispensable. Under subsection (a), subpart (2) they are because they all have an interest in these cattle and as a practical matter their rights are going to be impaired if the bank takes away all of the cattle and the other people are left without cattle.
It’s not feasible to add them because they wouldn’t have subject matter jurisdiction. The next step is indispensable. Professor Yeazell reminds us of replevin (mine to possess). If the bank wins, what happens to the other creditors? They don’t loose anything; they only loose the possession of cattle. There is nothing to prevent to brining an action against the bank. They are not indispensable, the matter can proceed because the other creditors have not lost their rights. There interest is affected but not enough to be indispensable – they have other options and forums to pursue.
b. A Spendthrift Trust: Someone who wants to leave a lot of money to another adult but fears he will blow it all. You create a spendthrift trust with a trustee for when to give the money and for what purpose. In this case there are two important factors: 1) under the language of the trust agreement, the trustee could chose to give all the money; and 2) should Larry die that trust descends to the children. Larry sues the trustee whether or not to get the entire trust.
Are the children necessary parties Under Rule 19(a)? The children have a future interest. The children have an interest but it’s a future interest. If Larry proceeds with this action without the children being parties will the resolution possibly affect the rights of those children? If Larry wins all the money goes to him so it does affect their rights. They are necessary parties.
c. There is a potential for multiple and overlapping judgments. What the insurance company could do is pay the money to the court and sue everybody and let the court distribute the money. The key is the defendant knows he’s liable to somebody. Why should the defendant have to fight multiple lawsuits when it’s not their fault the wives are fighting? They know they have to pay but they don’t know whom to pay. That is called Interpleader.
Rule 24. Intervention.
Two types:
1. Intervention by right; and
2. Permissive intervention
24(a): Intervention of Right. Discover in certain situations in which persons who are not already parties may intervene an existing litigation. Upon timely application anyone shall be permitted to intervene in an action:
(1) when a statute of the United States confers an unconditional right to intervene.
Again, the existing parties may not want this person in the lawsuit because if they wanted him they would have joined him under the liberal Joinder rules. In civil rights cases the government reserves the right to intervene. Another example is when the Attorney General of the United States brings an action or injunctive release against people for violating the Fair Housing Act. If the government is doing that on behalf of the tenants who have been discriminated against, the statute specifically says that the tenants have the right to intervene in the lawsuit to recover their damages.
(2) when the applicant claims an interest relating to the property or transaction which is the subject of the action and the applicant is so situated that the disposition of the action may as a practical matter impair or impede the applicant's ability to protect that interest, unless the applicant's interest is adequately represented by existing parties.
There are three requirements and you must satisfy all three:
1. The intervener has a significant interest in the subject matter of the pending litigation;
2. A substantial risk that the litigation will impair the intervener’s interest; and
3. The existing parties do not adequately protect that interest.
24(b) Permissive intervention: A party is permitted to intervene (1) when a statute, an act of congress, confers a conditional right to intervene; or (2) when an applicant's claim or defense and the main action have a question of law or fact in common. The court has discretion to deny the motion for intervention. If the intervening party can meet the requirement which means that there is a common question of law and fact, the court has the discretion to deny the motion. They court will do so if allowing intervention would undue the delay or somehow prejudice the parties to the existing litigation. Sometimes an intervening parties situation is far more complicated than the existing case, the court may say no, bring your separate lawsuit.
If the intervener so predominates the litigation that it significantly shifts or upsets the roles of the existing parties, the court will often use that as a reason to deny the intervention. The court has the authority to attach conditions to a permissive intervention.
Example: If the court permits the intervention but that results in having to redo discovery, the court may condition the intervention on paying the cost for the duplication of the discovery. The courts have tremendous discretion here.
The rule doesn’t have the time limit but the court will take time into consideration in determining whether or not it’s an intervention whether it’s by right or by leave. What is the delay, what is the length of delay, did the intervening party know of the litigation, did they wait an excessive amount of time, etc.
The courts must have jurisdiction. Personal jurisdiction is usually not a problem because the intervener is obviously consenting to the jurisdiction. If the intervener’s claim destroys subject matter jurisdiction, the court can deny the motion.
Like the well pleaded complaint rule, the general rule is that courts simply don’t look at how the intervener pled the case. The court looks beyond how the case was drafted. The intervener might style herself as an intervening plaintiff and might even draft a complaint naming herself as a plaintiff and make allegations that conform with the allegations in the complaint. But if the court upon review determines that actually the person’s interests are aligned with the current defendant and are antagonistic to the plaintiff, the court will simply declare that she is an intervening defendant. You always have to ask the question of the intervener, are they a plaintiff or are they a defendant.
Natural Resources Defense Council v. United States Nuclear Regulatory Commission
10th Circuit, 1978
This was an appeal of a denial of a motion to intervene.
The Nuclear Regulatory Commission (D) is permitted by federal law to give the several states the power to grant licenses to operate nuclear power facilities. D is empowered to grant such licenses on the condition that it prepare an environmental impact statement. D entered into an agreement with the New Mexico Environmental Improvement Agency (NMEIA) permitting it to issue a license. NMEIA issued a license to United Nuclear without preparing an impact statement.
This environmental group is suing both the US Government and the New Mexico Government is seeking injunctive relief.
The day the lawsuit was filed, New Mexico issued a permit to United Nuclear. The American Mining Congress (a trade association) and Kerr-McGee wish to intervene. The trial court denies the motion to intervene. The reality is that these are two entirely independent organizations and certainly United Nuclear is not representing American Mining Congress or Kerr-McGee. When the court says their interests are adequately represented it means they are identical. Since their interests are identical it doesn’t help judicial economy to add parties who in effect are already represented. They lose on that point because
The Supreme Court has held that an interest must be a significantly protectable interest. Here the matter of the licenses is at issue. Kerr-McGee has one of the largest holdings of uranium properties in the state. A decision that favors P would no doubt have a profound effect on Kerr-McGee.
This court finds all three requirements of 24(a)(2) present. These interveners have rights that are not protected by other parties to the litigation. Those rights will be affected and they must be allowed to intervene. Reversed and remanded.
Martin v. Wilks
Supreme Court, 1989
1. Existing parties may join lawsuits
2. You can’t be bound by a judgment unless you were part of the lawsuit
3. Joinder is how people are bound to lawsuits
4. When in doubt read the rule
NATURE OF THE CASE: This was an appeal of an order reversing the dismissal of an action for reverse discrimination.
FACTS: Black firefighters brought a discrimination suit against the City of Birmingham, Alabama (D). It was settled by a consent decree; affirmative action programs were mandated. Several white firefighters, Martin (P), then sued under civil rights laws contending that the affirmative action programs constituted reverse discrimination as the promotions of the black firefighters were based on race. D defended on grounds that the consent judgment precluded P's suit. The district court dismissed P's suit; the prior judgment had a preclusive effect. The court of appeals reversed because Ps were not parties to the previous judgment. The Supreme Court granted review.
Some firefighters wanted to change the hiring practices of the city which they alleged was discriminatory and in violation of civil rights laws.
The original suit was resolved by a consent decree. The difference between a settlement agreement and a consent decree is a settlement agreement is simply private agreement between the parties. It’s a contract. It’s enforced according to the ordinary principals of contract law and if you were to look at the public record it wouldn’t say what the parties settled for or what the terms of the settlement were. A consent decree is different – it’s when the parties agree that the court may enter the order under the following lines and then it becomes a judgment. A settlement agreement is enforceable like an ordinary contract. A consent decree is enforceable as a judgment. When you get a judgment in a case you can’t file a law suit in the same case. You may not want a consent decree to keep it off of your record.
A consent decree gets entered in the 1970s. The union gets involved and they tried to intervene under Rule 24. The union should have been allowed to intervene. Of course the union has an interest, the rules on who gets promoted is about to change. Essentially they are saying, if you want to settle, you’ve got to bring everyone to the party. Unfortunately they wait too long and the court exercises its discretion to not let them intervene.
What happens next? The sought injunction claiming reverse discrimination and they try to get an injunction to prevent enforcement of these consent agreements and they lose that. Now we have the lawsuit that brings us here today.
What is the argument? What is the issue here? What’s their response? The defendants are saying this is a binding judgment. You can’t set aside the judgment. We have reached the consent, the appeal period has passed – you can’t set aside the judgment.
What’s your response if you are a white plaintiff? If you follow thru with this consent decree, if you conduct yourself in accordance with this consent decree, will violate the very same civil rights laws that you purport to be enforcing; therefore, we are suing you for the same reason the original lawsuit was filed – we want injunctive relief. The court is saying, if you wanted to intervene then why didn’t you? You knew about it, the union already tried to intervene but they were denied because they were untimely. There is no question that the white firefighters knew about the lawsuit and sat on the sidelines and chose not to do a thing. But they claim that they were not parties to the suit and that it’s not fair.
Now that the judgment is entered, now after 10 years of litigation (They settled it after the trial), now you guys come along and say that it’s not fair.
If I was one of the original parties to the suit I would be extremely annoyed that people just sat there and watched us spend all of our money, become emotionally exhausted and now that we finally come to a resolution then you come along and try and set it aside. I would be very upset. But at the same time I would be upset if my livelihood and my rights would be affected by some other people’s arguments that I couldn’t control.
The case ends up in front of the Supreme Court. One party says, if you are going to be affected, it’s your obligation to intervene. Another party says, no, if you are going to affect my rights it’s your obligation to sue me or join me under the Joinder rules. The issue before the Supreme Court was, whose obligation is it to walk down to the courthouse?
HOLDING AND DECISION: (Rehnquist, C.J.) Does a consent decree have a preclusive effect on persons who were not party to the prior action? No. Can a party seeking a judgment that binds nonparties obligate the nonparties to intervene in an action or must the party seeking the judgment mandatorily join the nonparties in the action? The latter is true. As a general rule of law, a party is not bound by a judgment in which he was not a party or was not made a party by service of process. A consent decree does not have a preclusive effect on persons who were not party to the prior action. No one is bound by a judgment in personam to which he was not a party.
This was a 5-4 decision – a close call.
How are we supposed to know whose rights get affected? What about a 10 year old kid who wants to become a firefighter? How are we supposed to identify him? It’s unreasonable to expect us to do that. That’s a good argument.
The other side of the argument is, how are you supposed to know who actually knows about lawsuit? Although these firefighters knew about the lawsuit it’s not always going to be that clear if they knew.
This case is all about reading the instructions. Justice Rehnquist says both of you guys have great arguments – let’s read the rules. There’s nothing in the rule that says that anybody with knowledge of a lawsuit, whose rights might be affected, is required to go down there and intervene. According to Rehnquist and the majority, the rule says existing parties may join parties. Sometimes they have to if it’s compulsory, sometimes they may if it’s permissive. But there is no way you can read this rule to say that somebody who is not a party, whose interest is going to be effected is required to join the lawsuit if they choose not to. When in doubt read the rules.
If somebody does not want to join and an existing party chooses to not join that party, then the existing party bears the risk. It’s a matter of who has to the shoulder the burden by making sure that all of the parties effectively do their job.
RULE OF LAW: “All agree that it is a principle of general application in Anglo-American jurisprudence that one is not bound by a judgment in personam in litigation in which he is not designated as a party, or to which he has not been made a party service of process.”
You can’t be bound by a judgment unless you were part of the lawsuit.
“Even if we were wholly persuaded by these arguments as a matter of policy, acceptance of them would require a rewriting, rather than an interpretation, of the relevant Rules.”
The Court decided to follow the rule as written.
POINTS OF LAW FROM CASE
Per Professor Benson:
1. A person cannot be bound to a judgment in litigation to which he or she is not a party;
2. A person is not required to intervene in a lawsuit in order to ensure that he or she is not bound by the judgment even if he or she is aware of the lawsuit and the possibility that the outcome would affect him or her;
3. Joinder as a party rather than knowledge of a lawsuit and an opportunity to intervene is the method by which potential parties are subject to the jurisdiction of a court and bound by a judgment or decree; and
4. The parties to a law suit presumably know better than anyone else the nature and scope of the relief sought in the action and at whose expense relief might be granted. It makes sense to place on them the burden of bringing in additional parties.
Not only as a policy matter, but according to the Rules as written, if an existing party wants to make sure a judgment or decree is binding on everyone, then it is their job to go out and find everybody who might be affected and start joining them. Joinder is how people are bound to lawsuits.
LEGAL ANALYSIS: This case was legislatively overruled by Congress in 1991 which prohibits challenges to consent decrees by individuals who had actual notice and a reasonable opportunity to intervene or whose interests were adequately represented. Even if a party’s interests are being decided in a lawsuit, that party is not obligated to intervene. The parties in a lawsuit may make the judgment binding on others by invoking mandatory joinder.
Congress’s clear intent in 1991 was to prevent strangers to prior Title VII litigation from collaterally attacking the final civil rights decrees and thereby delaying or preventing the implementation of Title VII remedies of employment discrimination cases.
Note 5(a), Page 784: After the 1991, no but after Wilks yes.
Note 5(b): The last thing you want is to join a party with their own ideas.
INTERPLEADER
Rule 22, Interpleader addresses the situation where the defendant in effect is not contesting liability. The problem is there are several claimants against the defendant. But what happens when the defendant says I know I owe somebody, but I just don’t know whom to pay. The classic example is life insurance policy. They owe $500,000 and there are 18 different claimants.
Why should the insurance company have to spend any money on litigation? The insurance company gives the money to the court and lets the court decide whom to give the money to. In view of the case we just read you can see why it is so important that everybody in the interest gets added. It is possible that sometimes the defendant also has a claim to the property.
1. A defendant can be another claimant to the very property with which he or she has possession.
2. Basically this rule allows the interpleader plaintiff (the person in possession of the property, money, etc.) to bring in and add as parties all claimants so that the court can sort through the various and competing claims and decide how it gets divided. There are two ways of accomplishing this. They are independent rules but they are made to complement each other. Rule 22 interpleader and statutory interpleader 28 USC 1335, 1397, and 2361 can be used sometimes in the same action but there are some subtle differences between the statute and the rule so you have to choose one over the other.
Basic requirements under both the Rule and the Statute:
The interpleader must plead claims that are independent of and at least partly inconsistent with one another. In other words, each claimant has to have an independent and inconsistent claim – not derivative claims.
Life Insurance Example: There are two claimants and each claimant is claiming that she is entitled to the entire proceeds – those claims are inconsistent, you cannot satisfy both.
The Stakeholder is the person in possession of property (Like a life insurance company). Sometimes the stakeholder has already been sued by one claimant, which is fairly common. If that happens, you file a counterclaim against the plaintiff and demand interpleader and then add all of the competing claimants to the property.
Rule 22:
The differences between Rule 22 and the statutory ones are mostly jurisdictional. Rule 22 is harder to get jurisdiction then the statutes. Basically Rule 22 requires normal jurisdictional requirements. In other words the court must have subject matter jurisdiction thru either federal question or diversity. But here’s the twist: under Rule 22 you cannot have supplemental jurisdiction; therefore, all claimants must have jurisdiction. You cannot thru supplemental jurisdiction entertain a jurisdictionally insufficient claim under Rule 22. With respect to diversity, under Rule 22 the citizenship of the stakeholder must be diverse from that of all the claimants. The claimants don’t have to be diverse from one another, but the stakeholder must be diverse from all the claimants. Each claimant’s claim must exceed $75,000 (because there is no supplemental jurisdiction). You must establish personal jurisdiction over each claimant and you do that by using the International Shoe Contacts Test. You must establish venue over each claimant pursuant to the venue statute. Rule 22 has pretty high standards.
The Statutes:
The statute is a little easier to meet. Under the statute the amount in controversy is much lower – each claimant must claim at least $500. If one claimant is diverse from the stakeholder, that is sufficient to establish diversity of citizenship. Section 2361 provides for a nationwide personal jurisdiction and service of process meaning you do not have to establish minimum contacts in the forum jurisdiction. If you serve anybody in the country, that court has personal jurisdiction over that person. Statutory interpleader is much easier. The statute authorizes federal judge to in effect stay proceedings. If the claimant files a separate action in state court, under the statute the Federal Court has the authority to stay any additional proceedings in either state court or Federal Court and in effect make all disputes under the same litigation.
Under the statutory interpleader the stakeholder is required to deposit the “stake” with the court. If it’s money, they have to deposit it with the court. All courts have bank accounts for this sort of thing.
Insurance Interpleader Example: When a person with a small auto insurance policy injures many people, the insurance company admits liability and divides the money amongst them. The insurance company will only have to pay out X amount but their duty to defend it limitless. The insurance company will sue all of the injured people and deposit the money with the court.
Cohen v. The Republic of the Philippines
146 F.R.D.
NATURE OF THE CASE: This was an interpleader action and a motion to intervene.
FACTS: Cohen (P) received paintings on consignment from Braemer who was an agent for Marcos entrusted to run her New York home. Breamer demanded the return of the paintings in 1992 and P refused because he was uncertain as to the true owner. P then brought an interpleader action against Braemer and the Philippines. Braemer claims that the paintings were collateral for loans made by him to Marcos. The Philippines claimed that the paintings belonged to them and that they were acquired with government funds which Marcos and her husband illegally obtained during the husband's tenure as President. Marcos now seeks to intervene in the action claiming that the paintings were acquired from her personal funds. The four paintings totaled nearly $5 million in value. Marcos denies any kind of lien or security interest on the paintings or in the alternative she claims a right to the paintings after payment to any amounts that might be due Braemer.
Consignment is having possession of something to sell while the owner retains title. The consignor becomes a bailee.
If Marcos doesn’t intervene she won’t necessarily lose all of her rights to the paintings but as a practical matter she might have a problem tracking down the paintings because once they are gone, they could be gone forever.
Cohen should have joined her initially – it would’ve solved a lot of problems. She does have interest in property. Marcos waited 5 months after the initial complaint was failed to intervene. Although she was involved in other legal matters, the court excused her untimelyness because it wouldn’t result in any prejudice to the other parties.
The interest has to contrary to the other claimants – it has to be inconsistent. One party can’t claim half and another claim half as well. If that’s the case then you don’t have interpleader; you just divide up the property. It has to be claims that cannot be resolved. They have to be competing and contrary interests. .
In regards to prejudice and lack of adequate representation, Marcos’s interest may be impaired by the action and is not adequately protected by the existing parties.
CLASS ACTIONS
Up until now we have been operating under the principal that no person can be bound by a judgment unless he or she were a part of the underlying litigation either as a plaintiff, a defendant, an intervener or someone joined pursuant to the Joinder rules. Class actions is one of the two exceptions we discussed when we looked at the Wilks case. Parties who are brought in the suit by joinder all share in active participation in the suit. You can’t settle the case unless everybody agrees. Everyone joined has the right to bring their attorney, engage in discovery, ask questions at trial, call witnesses during trial, etc. They are all active parties no matter how many there are, no matter what their interests may be.
The modern rules of civil procedure have gotten very good at consolidating litigation and they do it in a number of ways:
Mass torts example: Hotel fire in Puerto Rico. Professor Benson represented a company that manufactured packing material and that packaging material was covering unpacked furniture in the basement. It was alleged that the packaging material released toxic fumes which led to the deaths of some of the 250 people who died in the hotel fire. They used a standard of care argument. Because you can’t have 250 lawyers arguing the case the court appointed committees i.e. a discovery committee, a motion committee, etc.
Class Action has been around for a number of years. It originally was an equitable concept that came out of the courts of chancery and not out of the common law courts.
A Class Action allows adjudication of additional claims without having to actually enlarge the original number of plaintiffs.
Example: If 4 people file a lawsuit and if they can get the class “certified” – and there might 30,000 other people similarly situated – Class Action lets the court adjudicate all 30,000 issues without having to enlarge the original 4 plaintiffs. The original 4 plaintiffs are the only ones doing discovery, going to court, arguing motions, trying the case, calling witnesses, etc.
The whole thing about a Class Action is that you are limiting the number of participants. You can have all sorts of people who are parties and potentially bound by the judgment but you have severely limited how many people can participate in the actual trial of the case. Class members are bound by the outcome of the case but only their class representatives actually participate in it; they are in other words passive litigants without any say as to what goes on.
This of course raises due process problems and Constitutional issues. This is a rule that permits people who did not participate in the lawsuit to be bound by the judgment of the lawsuit and in some cases not even acknowledge that there was such a lawsuit.
The Class Action device or the rules we are going to look at gets around these constitutional problems by being very rigorous. Courts are extremely careful to follow the Class Action rules because if they stray from the rules or read the rules a little to liberally or broadly they run the risk of violating people’s constitutional rights. You have to exactly fit in to the requirements otherwise the court will not permit the certification of the class for fear of inadvertently violating people’s rights.
The requirements are simply to ensure that the passive class member’s interests are adequately represented by the active participants. All the rules we are going to look at come back to that point – are the passive class member’s interests being properly and aggressively and actually represented by the representative members – those members who are actively participating in the suit.
Most Federal Class Action suits are governed by Rule 23. The plaintiff is usually the class representative. The plaintiff usually pleads the individual claim – in other words, Claim 1: I’ve been injured and here’s how. Count 2: The plaintiff pleads the existence of a class and then requests the court to certify his or her claim on behalf of the rest of the class. In almost every Class Action the class is plaintiffs. It is possible to have a defense Class Action but it is rare.
Rule 23
Every proposed class must conform to 4 requirements under subsection (a) Under subsection (b) they have to fit into the categories of (b). There are 2 common law requirements that are not expressly stated in the Rule.
Common Law Requirements:
1. The class must be capable of definition. It must describe a group that genuinely exists – not a hypothetical group. It must do so with enough clarity so that the court can determine with confidence who is and who is not a member of the class. It has to be a little clearer that “those of us who like to ride bikes and not get hassled by the cops.”
2. The representative member must be a member of a class. Example: In my town there might be a genuine class of people being ripped off and in order to right the wrong, I want to file a Class Action on behalf of these people. I can’t do that because I have to be a member of the class. Article III of the Constitution – the court will only resolve an actual case in controversy. If I don’t have a case, I don’t have a controversy; therefore, I don’t have standing and no Article III jurisdiction.
Rule 23(a). Prerequisites to a Class Action
One or more members of a class may sue or be sued as representative parties on behalf of all only if:
(1) Numerosity. The class is so numerous that joinder of all members is impracticable. It’s a case by case basis and different districts have different attitudes and different judges have different attitudes but it has to be impracticable.
(2) Commonality. There are questions of law or fact common to the class. There must be a common fact or question of law among the class members that relate to the matter litigated. The common questions must predominate. What that means is, just the fact that some class members have individual issues that are not necessarily shared by other members will not automatically void the possibility of a Class Action so long as the common question predominates the Class. Different Class members might have different damages or different amounts that are owed them and that alone will not destroy certification. The test of commonality is not exacting.
(3) Typicality. The claims or defenses of the representative parties are typical of the claims or defenses of the class. This focuses on the representative Class members. The named parties must have the same issue as the Class members. Their claim must be typical of all of the claims of the Class as a whole and not merely a portion of the Class. This actually comes up a lot. The claims must be typical of everyone in the Class, not most everyone in the Class. As a practical matter the representative party must stand in the shoes of each Class member. The Constitutional requirement is that you cannot bind somebody to a suit unless those absent class members’ interests are adequately represented. They can’t be adequately represented unless the main plaintiffs have the same motivation and desire to win basically. The only way to be assured of that is if the Class members have the same claim as I do. Their strategy would be the same as my strategy.
(4) Adequacy of Representation. The representative parties will fairly and adequately protect the interests of the class. Can these people shoulder the burden? One thing the court looks for is conflicting claims between the Class members and the Class. If in fact the court finds that there are no conflicts, the court is going to inquire about how much money they have. Can they sustain the expense of a litigation that might take years? The court will inquire as to how many lawyers can devote their time to the Class at the risk of losing other clients. It doesn’t matter how intelligent or skilled you are, the court is going to ask you how you are going to handle the case. The court will also inquire the plaintiffs on how dedicated they are and how much they want to see this thru. All of the Class members whether they know about the suit or not are relying on the representative class members to do a really, really good job.
Rule 23(b) Class Actions Maintainable/Types of Class Actions
(b)(1)(A) The Class will be certified if the opposing party will otherwise be at risk of being subjected to incompatible duties. The focus of this subsection is not on the Class but on the opponent of the Class. They are trying to protect the opponent from having inconsistent obligations. Example: If the Class is only some employees and not other employees, are you going to run into a Wilks situation?
(b)(1)(B) Risk of practical impairment. Courts are always very concerned about inconsistent judgments arising from the same transactions or same set of facts. To the extent that the courts can avoid inconsistent judgments by having consistent judgments – that mitigates in favor of Class Action certification. This focus is on the Class members. Will many of the Class members suffer an injustice because they simply cannot afford to bring a separate lawsuit? What injustice will the putative Class members suffer if it’s not certified as a Class
(b)(2) Injunctive of Declaratory Relief, not money damages. Two requirements: (1) The Class must share a general claim against the non-Class party; and (2) The Class must seek primarily injunctive relief. Seeking money damages is not automatically prohibited under this but it must be secondary to the injunctive relief. As in the Wilks case the primary focus was injunctive relief.
(b)(3) Predominance of Common or Legal Factual Question. This is a catch-all category. If they don’t precisely fit in 1 or 2 then you look at 3. This is the so called opt-out Class. Class members must be given opportunity to opt-out of the Class if they choose. The court can certify under subsection 3 of 23(b) if two requirements are met: (1) The common issues must predominate over individual interests. The common question is what the court scrutinizes over anything. (2) The Class Action is a superior means of adjudicating the dispute.
(c) The court must provide at an early practical time to determine whether to certify the action as a Class Action. It permits but it does not require that the court direct notice to Class members in Classes certified under (b)(1) or (b)(2). It does require that notice be given to Class members found in (b)(3). The rule expressly lists the information the notice must contain:
the nature of the action,
the definition of the class certified,
the class claims, issues, or defenses,
that a class member may enter an appearance through counsel if the member so desires,
that the court will exclude from the class any member who requests exclusion, stating when and how members may elect to be excluded, and
the binding effect of a class judgment on class members under Rule 23(c)(3).
(e) Approval of Settlements and Voluntary Dismissal. The court must approve any settlement or any voluntary dismissal. The court must conduct a “fairness hearing”. The purpose of the hearing is to ensure that the settlement or voluntary dismissal that will bind class members is fair, reasonable, and adequate. You cannot settle the case until the court agrees to the settlement.
(f) Appeals. An Interlocutory Appeal is special Appellate Rule which is an appeal you bring before the case is resolved. In the federal system this is very rare and has a very rigid requirement. The court may exercise its discretion not to hear the appeal. There is no automatic stay and the case will continue on while the appeal is pending unless you can convince the district judge to stay proceedings pending the appeal. It mostly depends on whether or not the judge thinks you can win the appeal.
(g) Class Counsel. The courts do scrutinize the lawyers. They look at Class counsel. This gives the court guidance in determining counsel’s ability.
(g)(1)(A) The court must consider:
the work counsel has done in identifying or investigating potential claims in the action,
counsel's experience in handling class actions, other complex litigation, and claims of the type asserted in the action,
counsel's knowledge of the applicable law, and
the resources counsel will commit to representing the class;
(ii) may consider any other matter pertinent to counsel's ability to fairly and adequately represent the interests of the class;
(iii) may direct potential class counsel to provide information on any subject pertinent to the appointment and to propose terms for attorney fees and nontaxable costs; and
(iv) may make further orders in connection with the appointment.
I can’t emphasize enough the problems created by lawyers who suddenly lose it in the middle of litigation. The court at the vary outset wants to make sure that they have a good, solid, legal counsel whose going to be able to see the case through. A case may last 10 years so it is not to be taken lightly.
Page 795, Notes and Problems:
1. (a) She is not a member of the Class pursuant to the Common Law rules.
(b) The court is going to ask: who is your lawyer, how much experience, etc.
(c) Subsection (b) injunctive relief.
2. (a) Some members are benefited greatly. It doesn’t do anything for the students already paid. The problem with the settlement is now you are pitting class members against the other class members.
(b) They got to go to 23(b)(3) because the money damages predominate over the injunctive relief and money damages. What does that do to the case? It changes the rules for notice. You now have to provide each class member with notice and opt-out instructions where you didn’t have to before.
(c) The court was fine when it was under subsection 2. Now that it is under subsection 3 you have to give notice. Notice requirements have to be mailed out first class and that adds up fast.
Communities for Equity v. Michigan High School Athletic Assn.
US District Court, W.D. Mich., 1999
FACTS: Plaintiffs alleged that they have been excluded from interscholastic athletic programs and have received unequal treatment and benefits from the programs. They contend that this constituted gender discrimination in violation of Title IX of the Education Amendments of 1972, is against Equal Protection under the 14th Amendment, and a violation of Michigan state laws. They allege a large number of discriminatory acts. Plaintiffs filed a motion before the court for class certification; all present and future female students enrolled in MHSAA member schools who participate in interscholastic athletics or who are deterred from participating in interscholastic athletics because of defendant’s discriminatory conduct.
Boys football dominates everything. It sucks up all the money. The girls sports gets shorted because they are always working around boys football or boys basketball. Title IX basically says that everything has to be fair and equal.
Rule 23(a)(1) Numerosity is satisfied as it would be too impractical for thousands of girls to bring this lawsuit. So it was easy. So class certified.
Rule 23(a)(2) Commonality: Here the court basically says it’s one discrimination. It affects a bunch of different girls and a bunch of different sports but it is one discrimination against Title IX. It creates a common violation even though you are talking about different sports.
Rule 23(a)(3) Typicality: The variety of alleged manifestations of discrimination present a sufficient case of an underlying policy of practice of discrimination.
Rule 23(a)(4) Adequacy of Representation. It is required that class members and their counsel be prepared to provide fair and adequate representation to the class. The defendants insist that 80% of the class like the status quo. Judge Enslen basically says I don’t care; you can’t consent to having your civil rights violated. Adequacy of representation is also measured by the quality of class counsel and there was no question here that plaintiff’s attorney was qualified.
Rule 23(b)(2) Injunctive Relief. Injunctive relief is, of course, an appropriate remedy for discriminatory treatment. Motion for Class Certification shall be granted.
Heaven v. Trust Company Bank
11th Circuit, 1997
Heaven (P) leased a Ford Taurus from Sun Trust (D) by signing a preprinted lease form. Plaintiff sued defendant because she alleged that defendant failed to comply with the strict disclosure requirements of 15 U.S.C. Section 1667-67e and Regulation M. plaintiff sued for the statutory penalty and fees but alleged no actual damages. Plaintiff sought to certify this lawsuit as a 23(b)(3) class action. Defendant counterclaimed that the individual class members had defaulted on the terms of their leases or made false statements in their lease applications. The district court denied certification on the ground that the counterclaim required individual responses from plaintiff’s class and, thus, destroyed the superiority and manageability of the class action. Plaintiff appealed.
This is a basic common breach of contract claim. The rule that this case turned on was the need for individual responses will make management of the class action difficult under Rule 23(b)(D). It defeats the whole point of a class action lawsuit when the court has to in effect make separate determinations for each and every member of the class. A class action is designed to resolve wide-ranging problem in one fairly efficient lawsuit.
Hansberry v. Lee
Supreme Court, 1940
FACTS: In a prior case involving a racially restrictive covenant, the Illinois Supreme Court determined that the covenant was valid and that because the action was a class action, all members of the class would be bound by the decision of the court. Hansberry (D), a black, purchased land from a party who had signed the same restrictive covenant forbidding the sale of the land to blacks. Lee (P), one of the parties to that covenant, sought to enforce the covenant based on the prior case involving the same covenant. D claimed that he and the party selling him the house were not bound by the res judicata effect of the prior decision, because they were not parties to that litigation. D alleged a violation of their due process rights. The court held that the prior decision of the Illinois Supreme Court would have to be challenged directly in order to have it set aside or reversed. The court held that the prior action was binding on D. The case was appealed to the U.S. Supreme Court.
The covenant by its terms was effective if signed by 95% of the landowners. The parties to a previous action involving the covenant stipulated that 95% had signed when in fact only 54% had signed.
Why are we here if only 54% have signed rendering the covenant unenforceable? In the earlier case the people fraudulently stipulated that 95% had signed it.
RULE OF LAW: A judgment is binding on all members of a class in a class action only if there was adequate representation of them. Not all members of a class need be present in order for a class action judgment to be binding upon them. When a class member has not been adequately represented, giving res judicata effect to that judgment violates Due Process.
Res judicata: The thing is decided. Once a lawsuit is resolved, it’s resolved. You can’t keep filing lawsuits hoping that you will win.
Hansberry’s argument to the res judicata argument is, it’s not fair. I had no knowledge of the lawsuit; I had nothing to do with the lawsuit.
The only time that the Supreme Court gets involved with state issues is when it violates the Constitution. He had property and the state took it away from him; therefore, violating his due process right.
The Fourteenth Amendment says the states cannot take away your property without due process. The Fifth Amendment says the government cannot take property without due process.
Hansberry made the exact same argument to the Illinois Supreme Court. The Illinois Supreme Court said that he was a member of the prior class action – the class was the people with the exclusion clause in their deeds – and even though nobody called it a class action suit, he was bound by it nonetheless.
The Supreme Court raises this issue to a constitutional right. Illinois had no right to deprive Hansberry of his property without due process and the Court found that there was no one who represented Hansberry’s interests because the plaintiffs in the prior action sought to enforce the covenant whereas Hansberry in the present action seeks to resist enforcement. Each belongs to a different class because they have opposing interests.
What we are really exploring here in these class actions is the constitutional underpinnings of class actions. Class action is a vehicle by which people, who might not even know about the suit, could potentially have their rights taken away from them and that raises constitutional questions. Lee v. Hansberry was a specific constitutional issue and we see that any class action – even if it is a purely state law, state court class action law suit – it has its constitutional implications because of the way people’s rights can be affected. The United States Supreme Court makes very sure the constitutional rights are protected.
Phillips Petroleum v. Shutts
Supreme Court, 1985
Phillips was a plaintiff class action in a Kansas state court in which a representative sued an oil company on behalf of a class of 33,000 people who, plaintiff claimed, were owed royalties by Phillips under oil well leases. Phillips argued that because in many cases neither the owner nor the oil well was in Kansas, there were no minimum contacts sufficient to allow Kansas to adjudicate the claims.
Benson: The reason why you have never seen a case where personal jurisdiction over the plaintiff is an issue is because the plaintiff, by filing the lawsuit, automatically consents to jurisdiction. This case is different – you’ve got a class – and not everybody in this class consented to jurisdiction. So the defendant is saying: you don’t have jurisdiction over these plaintiffs because they never consented and they don’t have sufficient minimum contacts with the state of Kansas.
What the defendant is saying is that by certifying the class and by hooking into the class people over whom you have no jurisdiction, that violates the Constitution; therefore, it was wrong to certify the class.
Opt in vs. Opt out
In order to solve the problem, the defendant says: by forcing people to opt in, they’re forced into consenting to jurisdiction. If they opt in by consent, they are consenting to jurisdiction.
Note: Although a party usually may not challenge a court's lack of jurisdiction over other parties, the Court allowed Phillips to assert the defense. After all, if Phillips were to prevail in the case, it would want the judgment to bind all members of the class. However, the judgment could bind the absent members only if the court had personal jurisdiction. Phillips didn’t want a bunch of people suing them after they have spent millions defending and settling to suit, to come and say, you didn’t have jurisdiction over me and sue them separately.
Supreme Court holding: The Supreme Court held that the Kansas court could exercise jurisdiction over the absent members of the class. Although due process usually requires minimum contacts, the Court held that certain protections afforded by the class action device served as a substitute for minimum contacts. The Court noted the following features of class actions:
A. the lack of any burden on the member to travel; instead, the burden of litigating the claim would be borne entirely by the representative;
B. the guarantee of adequate representation of the members' interests;
C. the provisions in Fed. R. Civ. P. 23 guaranteeing the members notice and the opportunity to opt out of the class;
D. because courts would rarely allow a defendant to file a counterclaim against members of the class, the class action would result in no money judgment against the members.
Note: The Court did remand the case to the Kansas courts, but for another reason. The Kansas courts had applied Kansas law to every claim. The Court held that Kansas could not constitutionally apply Kansas law to claims that had no connection whatsoever with that state.
Limits of holding: Broadly read, Phillips could make personal jurisdiction a non-issue in class actions. However, the Court's opinion contains several significant limitations.
a. Defendant class action: Phillips was a plaintiff class action. In theory, the rationale could apply to cases where a plaintiff sues a class of defendants. On the other hand, members of a defendant class would be subject to a money judgment. The Court specifically refused to deal with this question, stating in footnote 3 of the opinion that the opinion “does not address” defendant class actions.
b. Nondamages class actions: Nor did the Court express an opinion concerning other types of class actions, such as those seeking specific relief. Again in footnote 3, the Court suggested that the result in those cases could be different. This limitation is especially important because, as discusses below, Rule 23 does not guarantee members of a 23(b)(1) or (b)(2) class either notice or the right to opt out, two features of class actions that were important to the rationale of Phillips.
Benson: The moral if this story:
1. You have to give a chance to opt out;
2. The class has to be adequately represented; and
3. You have to give notice and an opportunity to be heard in accordance with Mullane. Mullane didn’t say actual notice, it said it had to be reasonably calculated to give actual notice.
Venue
Apply the venue statute to the class representatives.
Diversity
Look to the class representatives, not every member of the class. So long as the plaintiff class representatives are diverse from the defendants, you’ve got diversity. This was changed by the Exxon case. Under supplemental jurisdiction, the courts will entertain the claims of each member of the class.
In 2005 Congress passed the Class Action Fairness Act. The perception was that too many state courts were entertaining too many class action lawsuits. Some states had reputations of granting multimillion dollar awards in class actions. After much lobbying from manufacturers, the act was passed. Essentially it makes it a whole lot easier to bring/remove a class action into Federal Court.
Amchem Products, Inc. v. Windsor
Supreme Court, 1997
FACTS: The class in this asbestos action proposed for certification potentially encompassed 100,000's and maybe even 1,000,000's of parties. All of the parties were exposed to asbestos products manufactured by 20 or more different companies. There was no litigation intended for this class as the settling parties presented a complaint to the District Court, an answer, a proposed settlement agreement, and a motion to conditional class certification. Various class members raised objections and the judge granted them full rights to participate in the subsequent proceedings. Their main objection was that the settlement unfairly disadvantaged those with currently compensable conditions, it failed to adjust for inflation, and in advances in medical science. Objections were also made with respect to 23(a)(4), wherein the class counsel and class representatives had disqualifying conflicts of interest. The contention was that parties with injuries and parties currently without any injuries should not be represented by the same counsel. The court conditionally certified under 23(b)(3). The United States Court for the Eastern District of Pennsylvania certified the class for settlement only finding that the proposed settlement was fair and that representation and notice had been adequate. The Court enjoined members of the class from separately pursuing asbestos related suits in any court, federal, or state pending the issuance of a final order. Ds appealed that decision and the Third Circuit held that class certification failed to satisfy Rule 23's requirements. It found that serious intra-class conflicts precluded the class from meeting the adequacy of representation requirement under 23(a)(4). The Supreme Court granted certiorari.
Issues:
1. Do the requirements of Rule 23(a) and Rule 23(b)(3) fully apply to certification of settlement classes?
2. Is the proposed settlement class fair to future, unknown class members; i.e., should it be certified?
As Justice Ginsberg points out, Congress basically dumps this on the third branch of government and relies on the Supreme Court to figure this out.
Justice Ginsberg is concerned about the sliding scale of settlements. Because the settlement class will lack the ability to adjust the class, rules designed to protect absentees are vitally important. The settlement provisions directly impact whether the settlement is “fair.” If “fair,” then certification is proper.
The proposed settlement class action cannot be certified because it does not satisfy Rule 23(b)’s requirement that common questions of law or fact predominate. The predominance requirement is not met by the fact that all asbestos victims may share an interest in expeditious resolution of their claims. Also, Rule 23(a)(4)’s requirement of adequate representation is not satisfied because the “inventory” plaintiff’s claims were traded off against the “futures” claims.
ERIE DOCTRINE
The Erie Doctrine addresses when to apply federal law and when to apply state law. The Erie Doctrine mainly applies in diversity cases. If it’s a federal question there is no question that you apply federal law.
Article III
1789 Rules of Decision Act: in cases where the Federal Court is sitting in diversity, “the laws of several states, except where the constitution, treaties, or statutes of the United States shall otherwise require or provide, shall be regarded as the rules of decision.”
Right out of the gate, Congress’s message to the Federal Courts was, if it’s not a federal question, apply the state law of whatever state you’re sitting in.
This was complicated dramatically by the Tyson v. Swift decision (1841). The basic holding of Swift was that Federal Courts were not bound by the Rules of Decision Act to follow state judicial opinions on most legal issues. Instead, a Federal Court could make an independent interpretation of what that common law rule was on the particular subject. If there is a local custom or something immutably tied to the state such as real estate, then we apply state law. If it is a matter of general commercial law, we don’t have to follow the Supreme Court decrees of general commercial law.
One philosophical approach of the day was that judges did not make law, they found law. The other approach was that the Supreme Court can make law; therefore, we should follow them.
The Swift v. Tyson court had some practical applications in mind. Most notably was uniformity. They wanted to see a system where the laws of the United States of America were generally uniform – there shouldn’t be one law in Rome and another in Athens. Swift’s underpinnings were false. The states were just not that impressed with the federal judges and their federal common law. We had the exact opposite. We had two very different systems – federal law in one direction and state law in the other. The problem was forum shopping.
Erie Railroad v. Tompkins
Supreme Court, 1938
The plaintiff in Erie was hit by a train while walking along the tracks of defendant railroad. He sued the railroad in a federal district court based on diversity jurisdiction, claiming that the railroad had acted negligently by leaving the door to one of the cars open. The accident happened in Pennsylvania.
Clash of laws: Under Pennsylvania law, plaintiff could recover only upon a showing of “wanton” negligence because he would be considered a trespasser on the railroad’s right-of-way. Plaintiff, however, argued that the federal court should apply the “general” or federal common law rule, which required the railroad to act with ordinary care.
Mr. Tompkins wisely chose the Federal Court system because the Federal Court was more advantageous to him. What they are also arguing as a matter of Pennsylvania was such that
Holding: The Supreme Court held that the lower court was obligated to apply Pennsylvania’s wanton negligence standard.
Rationale: The court overturned its earlier holding in Swift, finding that the reference to laws in RODA included not only state statute law, but also state judicial opinions interpreting the common law.
a. View of common law: The Erie Court rejected the idea that there was a “general” common law that applied with equal force in all common law jurisdictions. Instead, the court indicated that each sovereign state created its own common law.
b. Federal Courts and common law: The Court also held that the Federal Courts, unlike state courts, had no power to create common law. Therefore, RODA required the Federal Courts to follow the common law rules set out by the state courts.
If you have a particular rule of law, and the federal law conflicts with the state law, then you apply state law. Federal law applies only when a specific federal statute governs the matter or where a federal question is before the court.
Three Points The Court Made:
1. Swift erroneously interpreted the RODA;
2. Lack of uniformity resulting from Swift led to discrimination and forum shopping; and
3. Swift was unconstitutional because it authorize Federal Courts to make law in areas that even Congress was not permitted to make law
Congress has the power to create procedural rules. Erie was substantive law.
Procedure v. Substantive
Example: Negligence is substantive law. Negligence tells us if plaintiff has a cause of action. The procedure doesn’t address whether or not plaintiff has a cause of action. The procedural aspect of it governs the manner and means by which a right to recover is enforced.
Guaranty Trust Co. v. York
Supreme Court, 1945
1. Outcome determinative test
See page 72 of Legalines and page 88 of Emanuel
If the conflict between the federal and the state rule would result in a different outcome, then you have to file with state law.
Byrd v. Blue Ridge Rural Electric
Supreme Court, 1958
1. The balancing test
Byrd (P) was injured while connecting power lines. P was an employee of a subcontractor of Blue Ridge Electric Cooperative, Inc. (D). P sued D in federal court in South Carolina for negligence under diversity jurisdiction. P was a citizen of North Carolina and D was a South Carolina corporation. D defended on a South Carolina law that limited P's award to that of workers compensation and thus precluded a negligence action. There was a factual dispute as to whether P should be considered a statutory South Carolina employee for purposes of Workman's Compensation. Under South Carolina common law, such an issue was decided by the trial judge and federal procedural law required the issue to go to the jury.
The Court held that a Federal Court did not have to follow a state law that required a certain question to be decided by the judge. Instead, the Federal Court could follow the federal practice of having a jury decide the question.
a. Judge vs. Jury: The Court recognized that whether a judge or a jury decided the case could affect the outcome; however, it held that the likelihood of a different outcome was not great.
b. Federal Interest: Moreover, the Court noted a strong federal interest in using juries whenever possible, as evidenced by the Seventh Amendment. On the other hand, the state rule requiring a judge reflected no strong state interest, but was merely a historical practice. You don’t always have a right to a jury trial.
c. Holding: Comparing these interests, the Court held that the Federal Court could use a jury, even though the difference in laws was slightly outcome determinative. On this issue it was procedural because there was nothing in the workers compensation statute that suggested whether a judge or a jury was terribly important but the federal system favors juries.
d. Current relevance: The Byrd balancing test has never been disavowed. It continues to apply to judge-jury questions and is often invoked by the lower courts on other issues.
CONTINUING ERIE DOCTRINE
Hanna v. Plumer
Supreme Court, 1965
The defendant was the executor of an estate of someone who died in an automobile accident. The question presented was how the estate was served. Under the federal rules of civil procedure, one of the many ways you can serve an estate is to serve the personal representative. In this case the federal rule provides that you can leave service at the house with a person of suitable age and discretion. The state had a different rule. Which rule applies?
When a situation is covered by one of the federal rules, the appropriate test is twofold:
1. Whether the applicable rule is within the scope of the Rules Enabling Act (i.e., “relates to the practice and procedure of the district courts” or, in other words, whether it “really regulates procedure – the judicial process for enforcing the rights and duties recognized by substantive law and for justly administering remedy and redress for disregard or infraction of them”; and
2. Whether such rule transgresses constitutional bounds.
At the time the York decision (outcome-determinative test) was the law. Under York, this case would be dismissed and would be unable to re-file because the statute had run. The district judge applied the York test correctly but the Supreme Court decided to revisit this issue. The Supreme Court does not overrule York; however, they limit its application.
Up until now we’ve had common law. Now the difference is we have an act of Congress – The Rules Enabling Act, which authorizes the Supreme Court to actually promulgate the rule with the express authority of Congress. Congress has the power to regulate procedure.
The Enabling Act itself is constitutional and the constitution only gives power to the Congress to write procedures for the courts.
Rule 4(d)(1) is clearly within the scope of the Rules Enabling Act. Prescribing the manner in which a defendant is to be notified that a suit has been instituted against him, it relates to the practice and procedure of the district courts. Service of process is procedural – it doesn’t result in the extinguishment of a right.
See Emanuel pages 89-90
When dealing with a post Hanna case, and there is a conflict between federal law and state law, you have to first ask yourself: would the application of federal law versus state law affect the outcome of a case in a way that would encourage forum shopping?
If the application of federal law would not affect the outcome, then you simply apply federal law. If the application of federal law would affect the outcome in this way, then you have to do the balancing-test (Byrd case – state interest vs. federal interest).
If the federal interest is stronger than the state interests are, then you apply federal law.
The Constitution authorizes Congress to make procedural rules governing Federal Courts. Congress exercised and delegated this authority to the Supreme Court in the Rules Enabling Act. Pursuant to this authority the Supreme Court created and promulgated the Federal Rules of Civil Procedure.
If Congress makes promulgates an Act in accordance with the Constitution, it takes precedent over state law. You have to follow the rules of civil procedure when you are in Federal Court – you don’t have the option to follow the state rule. Therefore, FR 4 trumps the state rule for service of process.
Semtek Intl. Inc. v. Lockheed Martin Corp.
Supreme Court, 2001
P sued D in California and the action was removed to federal court under diversity. It was dismissed because of the running of the two-year statute of limitations in California. P then sued in Maryland because of a three-year statute of limitations. D moved for dismissal on res judicata. The action was eventually put in a Maryland State court that granted a dismissal based on the res judicata of the California federal diversity decision. The Supreme Court granted certiorari.
One of the things required by res judicata is that it has to be a decision based on the merits to prevent subsequent litigation.
Benson: Was the first decision based on the merits? What we’re trying to figure out is, does state law apply or does federal law apply? (We are still studying the Erie doctrine and not res judicata yet).
The Federal Court of appeals said federal law applies. Federal common law says that the claim is precluded.
Rule 41(b) Involuntary Dismissal: Effect Thereof.
For failure of the plaintiff to prosecute or to comply with these rules or any order of court, a defendant may move for dismissal of an action or of any claim against the defendant. Unless the court in its order for dismissal otherwise specifies, a dismissal under this subdivision and any dismissal not provided for in this rule, other than a dismissal for lack of jurisdiction, for improper venue, or for failure to join a party under Rule 19, operates as an adjudication upon the merits.
The defense is looking at Rule 41 and saying, not only is it an adjudication upon the merits, but the judge’s very order said that. And since we know that Rule 41 was promulgated with the Rules Enabling Act, federal law should apply right? Justice Scalia has a different view.
Scalia’s analysis: He gets around this language in Rule 41 by saying when they drafted this language they said “on the merits” but they didn’t really mean “on the merits” – for purposes of res judicata or claim preclusion. What they really meant to say was “with prejudice” and that means you can’t file it in the same court. Now everyone is in a different state with a different system altogether. Scalia doesn’t find any collision between Rule 41 and state claim preclusion laws. If you interpret Rule 41 as the defense was ask them to, that would go beyond the REA because that would affect a substantive right.
This is the sort of outcome-determinative test that exactly Erie was worried about (deciding between state and federal court). The invitation for forum shopping was too great in this particular case so they applied state law.
The Supreme Court held that the claim was not barred. The Court questioned whether Rule 41(b) might exceed the REA if it were to bar a substantive law claim. Instead, the Court held that the law in which the original Federal Court sat would be used to determine if plaintiff’s claim was barred.
Recap of the holding per Benson:
In any res judicata/claims preclusion situation, we are dealing with two lawsuits. By definition you are trying to decide whether the second lawsuit is “precluded.” In other words, is the second lawsuit going to be dismissed? In order to determine whether the first lawsuit – what is the “preclusive effect” of the first lawsuit, you apply the law of the forum of where the first lawsuit was filed – it’s usually the same forum, but this is a different case because they filed in a different state. When a Maryland court has to figure out whether res judicata applies, they have to determine what the California law is – not Maryland law for the first lawsuit.
1. Rule 41 did not apply because Justice Scalia and the majority said that the term “on the merits” in that rule really meant with prejudice (can’t re-file in the same court). Federal Common law says that it’s precluded. California said that it was not on the merits; therefore, it was not precluded. The state rule says not precluded, federal rule says precluded.
2. Is there a conflict? Here, there is because federal preclusion law would define the dismissal as “on the merits” for res judicata purposes while California law would not. Would the application of federal law affect the outcome of the case in such a way as to encourage forum shopping and discriminate against state residents? Yes, this is exactly was Erie was worried about. You have a federal judge in California, you have a state judge in California and they’re a half a block apart. You’ve got two very different rules that very much will affect the outcome of the case. One case is going to be dismissed forever and one will go to a jury. This would result in forum shopping and discrimination against in state residents.
3. Weighing the federal interests against the state interests, i.e. applying Byrd. The Court already applied York, now they are going to apply Byrd. The majority did not find any conflict with potential federal interest in the case. The majority did say parenthetically that this has to be done on a case by case basis. There might be times when dismissing a case in Federal Court where federal interest and res judicata might be strong enough to apply federal law – but not in this case. In other words, the federal government doesn’t really care; therefore, California law should apply. Under California law, this dismissal was not on the merits, therefore the plaintiff was free to continue its lawsuit in Maryland (this is not forum shopping – state law vs. federal law is forum shopping).
When might a dismissal of a federal case create a strong interest in the Federal Courts to give it preclusive affect? When a case is dismissed by way of sanction. You bring a suit in Federal Court, you repeatedly and consistently fail to follow the judges orders. If you file the case in another state, the judges might say no, this is a sanction; therefore, we are not going to allow it.
RES JUDICATA
The thing is decided
Hypo: I go to a ski resort and I fall and break my leg. I determine that the slopes were defective somehow and I sue them for negligence and I lose. Can I sue them again? No, I get one shot.
What if I find out that my broken leg has degenerated and needs to be amputated? Can I sue them again now? No.
What if I sue for negligence and I lose. I later determine that they breached the contract because I paid a consideration and they were supposed to provide me a reasonably safe slope? Can I sue for that? No, it clearly arose out of the same transaction or occurrence; therefore, I would’ve had to have added the claim in my negligence suit.
Courts like finality and efficiency – they like getting things resolved in one suit if at all possible. Because of the liberal Joinder rules, there is no reason to file multiple lawsuits. Res judicata is not liberal.
Claim Preclusion: If you could’ve brought a claim and failed to bring a claim, you may be barred from bringing the claim.
The General Rule for Claim Preclusion/Res Judicata:
A final judgment on the merits precludes the same parties (and those closely related to them) from litigating the same or a sufficiently similar claim in a subsequent lawsuit. It also forbids a party from litigating a claim that should have been raised in the former litigation but was not.
Federal Courts refer to this as claim preclusion
State Courts refer to this a res judicata
The General Rule for Issue Preclusion/Collateral Estoppel:
A final judgment not necessarily on the merits, precludes re-litigation of the same issue of fact or law, so long as (1) the issue was actually litigated, determined, and necessary to the judgment in the first action and it would not be unfair to invoke the doctrine. Unlike res judicata it does not require strict identity of the parties. The people who weren’t even involved in the first lawsuit can, and often do, rely on collateral estoppel to prevent the re-litigation of certain claims even though they were not even a party to the first suit.
Three Essential Claim Preclusion Elements:
1. The claim in the second suit must be the same as the claim in the first suit or a suit that could have been brought in the first suit but wasn’t;
2. The first and second suit must be between the same parties or parties in privity with one another; and
3. There must have been a final judgment on the merits in the first suit.
The Restatement (Second) on judgments:
(1) When a valid and final judgment rendered in an action extinguishes a plaintiff’s claim…, the claim extinguished includes all rights of the plaintiff to remedies against the defendant with respect to all or any part of the transaction*, or series of connected transactions, out of which the claim arose.
*This is referred to the Transaction Test. It is the most common among the states. Basically what it means is when all of the other requirements of res judicata are met, it bars any claims that arose from the same transaction or occurrence as the first claim.
This is somewhat similar to the compulsory counterclaim rule: if you fail to bring all of your claims, you have waived them and cannot bring them in a subsequent suit. You can’t keep bringing lawsuits for the decision you want.
Another test (used in California) is the Primary Rights Test. It is at the opposite end of the Transaction Test and it has a very narrow view. In other words, fewer claims would be barred under the Primary Rights Test. The courts look at: what is the primary right or what is being enforced here. Is it the right to enforce a contract or the right to be compensated for a personal injury or the right to be free from injury to your property? Under this narrow test, I could sue the ski resort for breach of contract because I am asserting a different right – my primary right in the first case was a tort claim, to be free from personal injury. In my second I’m trying to protect my right to enforce or seek damages from my contract. Most states have abandoned this view.
The Same Evidence Test falls in between. If the same evidence is needed to sustain both claims, then the claim would be barred. My breach of contract claim against the ski resort would be a close call but it would probably be barred.
Frier v. City of Vandalia
7th Circuit, 1985
Vandalia (D) police had a garage tow Frier's (P) car because he had been given two written warnings on the windshield but it was parked in such a way to block traffic. P did not receive a citation or a hearing either before the car was towed or after he refused to pay to retrieve it.
He files a lawsuit in district court seeking a writ of replevin (common law action to recover property from a party who wrongfully possesses it). He has to show that is right of possession is superior to that of the police. Frier looses.
He files a civil rights suit (42 U.S.C. Section 1983) in Federal Court because his due process (no hearing for the towed cars) rights were violated.
Issue: Was the section 1983 action the same cause of action as the replevin action?
Why does the federal government have to pay attention to the state decrees? The full faith and credit clause says that each state shall give full faith and credit to judicial decrees, statutes, etc. of every other state. Congress said that Federal Courts must give full faith and credit to any state court decree.
The district court judge has to look at the state decree and determine whether or not res judicata applies.
Because the claims shared a significant overlap in evidence, the new claims were barred under Illinois law, which uses the same cause of action approach (minority approach). Here the two suits were over the same acts but based on different legal theories.
Different states follow different rules.
Hypo: If Charles Frier had a wife and one of the vehicles was titled to the wife, is she then prohibited from bringing her separate action if Charlie brings his lawsuit and looses? Yes because there is no privity and she was not a party to the first action. It could be claim preclusion however.
Hypo 2: Instead of Frier suing the city, let’s say the city had sued him. His parking of the cars in the alley created a nuisance. He answers the claim, denies he’s done anything wrong, asserts a couple of affirmative defenses, litigates the case and he looses. Now Frier comes along later, files a separate action in Federal Court claiming a violation of his constitutional rights. Can he maintain that action? No, he had to raise it under Rule 13, compulsory counterclaim. Res judicata weaves in and out of other rules like a quilt.
Q: Is the Same Cause of Action Test in Frier the same as the Same Evidence Test?
A: Not really. This case presents a good example of why law students and lawyers alike must be very careful with labels. Apparently, in 1985, when the case was decided, Illinois, in applying claim preclusion, generally stated that the first suit precluded the second suit "where the parties and the cause of action are identical." Illinois also refers to the "same cause of action" test. But what do these terms, "same cause of action" and "identical" mean?
The majority said that by using these terms Illinois had actually adopted the broader so-called "transaction" test found in the Restatement (Second) of Judgments and followed by the federal courts. The minority opinion said no, when Illinois employs the term "identical," it is following the narrower "same evidence" test.
Obviously (by definition) the majority rules, so, according to the 7th Circuit, Illinois does not follow the "same evidence" test, but rather the broader "transaction" test.
Martino v. McDonald’s System, Inc.
7th Circuit, 1979, Cert. denied 1979
In 1962, Martino (P) entered into a franchise and lease agreement with McDonald's (D), which provided that neither P nor a member of his immediate family would acquire a financial interest in a competing self-service food business without the written consent of D. In 1968, P's son purchased a Burger Chef franchise in Pittsburg, Kansas. P financed the transaction. D sued for breach of contract, and P and D settled that dispute by entering into a consent agreement, which provided for the sale of P's franchise back to D. In 1975, P brought this action, alleging that the enforcement of the restriction on acquisition in the franchise and lease agreements violated Section 1 of the Sherman Act. The district court held that both res judicata and the compulsory counterclaim rule of the Federal Rules of Civil Procedure barred P from suing for antitrust violations. P appealed.
Rule 13(a) has been construed to provide that compulsory counterclaims are “lost of not raised at the proper time.” However, Rule 13(a)’s bar applies only when the defendant has entered a pleading as defined in Rule 7(a) (an answer). The problem in this case is that the defendants in the first lawsuit failed to enter a pleading; hence, their unasserted compulsory counterclaim is precluded by claim preclusion, not by Rule 13(a), and in deference to consistency.
If the rules do not require a defendant to bring a particular counterclaim in suit one, the party who was the defendant is free to bring the claim in suit two unless it falls within the narrow common law compulsory counterclaim rule. The common law rule asks whether the claim in the second case would have been a defense in the first case. If the claim would have been defense, it is barred. However, if the claim was a pure counterclaim, not a defense to the claim in the first case, the common law rule allows the party to bring it in the second case.
You can’t hold back a defense or a claim, settle the case on favorable terms and then sue on your defense.
Had they gone with a stipulation and order of dismissal instead of a consent judgment, would the result have been different legally? Yes. Would it make a difference in the real world? No because in the real world when you do a stip and order of dismissal, you also address these issues in your settlement agreement – it’s what you call a release. Releases tend to be broad and typically say that the parties agree to dismiss the case and the party hereby releases McDonald’s from any further liability know or unknown, etc.
Rush v. City of Maple Heights
OH, 1958
Rush (P) was injured in a fall from a motorcycle because of a negligently maintained street in the City of Maple Heights (D). P sued D in municipal court claiming that D was negligent in maintaining the street and this negligence was the proximate cause of her injuries. The municipal court awarded P $100 in personal property damages. D appealed and the judgment was affirmed. P then sued D in another court for personal injuries she suffered in the same accident. P claimed that the issue of negligence was res judicata from the judgment in the first action. P moved to set the trial for damages alone. This motion was granted. P was awarded $12,000. D appealed. The Court of Appeals affirmed.
The court held that claim preclusion prevented a plaintiff from bringing separate suits to recover for personal injury and proper damage stemming from the same accident.
Ohio moved from the primary rights test to the transaction test. When she filed the lawsuit, under the law in Ohio at that time, she had a valid second claim because she was asserting a different primary right – the right to be free from property damage and the right to be free from personal injury. She did win until the Ohio Supreme Court came along and she gets the rug pulled out from under her and changed the law.
Since plaintiff had but a single claim, the lower courts should have applied the doctrine of res judicata, which means the plaintiff’s second lawsuit should have been dismissed. Res judicata is when the 2nd lawsuit seeks re-litigation to the same claim litigated in the prior suit, and it bars such re-litigation. Collateral estoppel is when the 2nd suit addresses a different claim, and it precludes re-litigation of the issues decided in the 1st suit.
The minority rule was the wrong rule b/c it does not prevent multiplicity of suits, there are burdensome expenses, and vexatious litigation against D’s.
REVIEW
The Transactional Test is the broadest test which is what the Federal Courts follow. It is also the concept in the Restatement (Second) on judgments. There is a more restrictive test called the Primary Rights Test. It is an unusual test – the narrowest of them all and California still follows it. There is an intermediary test called the Same Evidence Test.
The Frier case was a 7th Circuit case meaning it was a Federal Court sitting in diversity attempting to apply Illinois law. The Illinois courts use very different language and that was the source of confusion. If you look at the case it says that Illinois follows claim preclusion as long as it is the “same claim” and it went on in another sentence and said the “identical claim.”
Different states use different languages. The way the majority interpreted that language is by looking at Illinois Supreme Court authority and decided that Illinois actually followed the broader Transactional Test – the court just never called it the Transaction Test in the state of Illinois. The minority opinion disagreed and said no, it has to be based upon the same evidence, which I would describe as the Same Evidence Test. There was obvious disagreement between the federal judges in that particular circuit as to what exactly the law of Illinois was. My point is that, unfortunately for all of us, the various states don’t always use language as we learn it in law school; the concept is important but don’t look at your first case in a panic because your state doesn’t use the same language as you learned in school but you do have to figure out what test your state is applying. The Federal Courts happen to be fairly uniform.
The Preclusion Doctrine
The basic idea is that it prevents people from relitigating cases that have already been decided by the courts. It is a common law doctrine and is case law developed over time. It has evolved over time from a very narrow concept to a much broader concept. You are far more likely today to be successful if you are the one asserting claim preclusion or issue preclusion than 50 years ago.
RES JUDICATA/CLAIM PRECLUSION
Three elements to prove Claim Preclusion:
1. The claim in the second suit must be the same as the claim in the first suit or one that could have been brought in the first suit but was not.
We have to determine: What is the same claim (Use one of the three tests). Under the Transaction Test a claim is deemed the same claim if it arises from the same transaction or occurrence as the claim brought in the original suit. When you file your second lawsuit if the second lawsuit arises from the same transaction or occurrence as the first lawsuit, you’ve met the first element which is the same claim. Under this test, if the plaintiff fails to bring a claim that the plaintiff could have brought or if a defendant fails to bring a counterclaim that the defendant could have, or even if the defendant failed to assert a defense, those can still be barred under the Transaction Test because they are claims or defenses they the defendant could have been brought, but were not.
The thing to remember is that res judicata is very harsh. They pleadings are so liberal – you can join any claim that you might have against a party; you can join other parties that might have a claim against you; you can amend the complaint if justice would require, etc. All of a sudden res judicata comes along and you have to read it in context of all these permissive joinders – you may join these claims. Lurking in the shadows is res judicata and if you don’t assert your claim you may be precluded (as long as you meet the other elements). It requires you as a plaintiff to claim everything you can think of that arises out of the same transaction or occurrence and it punishes you if you don’t. The same is true if you are the defendant; you have to assert all of your defenses in any counterclaim that you might have (it may be a compulsory counterclaim for Federal Court). Even in a state without a compulsory counterclaim, in a way they may be compulsory because of res judicata.
For exam purposes, be familiar with the Transaction Test – that’s what the Federal Courts follow. If the claim in the second suit arises from the same primary right of the first suit is considered the same claim.
Ski resort hypo: I sue the resort for personal injury and loose. I then turn around and sue them for breach of contract. Under the Transactional Test, that second claim will be viewed as arising out of the same transaction or occurrence as the first, and that would be considered the same claim.
In California under the Primary Rights Test, it would not be considered the same claim because the first right – the right to be free from personal injury – is different from the second right – the right to enforce contracts – so these are two separate rights.
The test that falls in the middle is the so called Same Evidence Test. This test treats the same claim as those claims that are substantially supported by the same evidence as claims brought in the first action.
What law do you apply? The general rule is: apply the law that was applicable in the first lawsuit.
Example: If the first lawsuit was filed in state court in California and the second lawsuit was filed in a different state, how do you know if res judicata or claim preclusion applies? You apply the California law to determine what preclusive affect that first lawsuit had. Look to the jurisdiction of the first lawsuit to determine what test they use.
If the first judgment was rendered by a state court, the rules of preclusion followed in that state apply even if the second suit if filed in Federal Court. There’s a statute that says that the Federal Courts have to give full faith and credit to state court judgments.
If the first judgment was rendered by a federal court sitting in diversity jurisdiction, the second court must apply the preclusive law of the state where the first court sits, unless the second suit is in Federal Court and the preclusion law of the first state is incompatible with important federal interest. That is nothing more than the Erie Doctrine modified over the years and ending with the Hanna case. Where there is a conflict, the courts are going to look at the controlling interest. The Federal Courts have a strong interest in applying federal preclusion, much more than a state court.
2. Claims Arising Out Of The Same Transaction But Not Considered To Be Part Of The Same Claim:
First Requirement for Res Judicata:
The first suit was brought in a jurisdiction that could not, for whatever reason, hear all of the claims.
Example: In Michigan the district courts shall handle all landlord/tenant disputes – they have exclusive jurisdiction over those disputes. If there is a related claim in excess of $25,000, the circuit court would have jurisdiction over that; therefore, while the landlord/tenant case is being heard in district court, you can’t bring the claim in excess of $25,000 between the parties – that has to be heard in a different court. When the landlord/tenant case is resolved, even though the $25,000 claim arose out of the same transaction or occurrence, there is no preclusive affect because the district court had no power to hear it in the first place.
Example 2: A Federal Court handling a federal question case declines (exercises its discretion) to accept jurisdiction over a state court claim under the supplemental jurisdiction statute. If the judge declines to do it, when the federal case gets decided on the merits, the related state case, even though it arose from the same transaction, is not precluded. Why? Because the parties had no ability to litigate it in Federal Court because the Federal Court declined to hear it; therefore, the aggrieved party is free to file that action in state court.
In other words:
Supplemental claims: If a plaintiff files a lawsuit in Federal Court claiming federal question jurisdiction and then asserts a state court claim over which the court would not normally have jurisdiction, the court can exercise (what we used to call pendent jurisdiction) supplemental jurisdiction. It is not mandatory; the court may use its discretion and not hear the supplemental claim. So even though the supplemental claim arose from the same transaction or occurrence as the federal claim, if the court refuses to hear it and then the federal case goes to a judgment on the merits, res judicata or claim preclusion is not going to prevent the plaintiff from bringing a separate action in state court. Why? Because the Federal Court would not hear the state claim but you have to attempt to bring it.
Example 3: If the second claim was not mature when the first claim was filed. As part of a business transaction there are two notes arising out of the same business transaction. One note is due and payable on February 15, 2007. The other note is not due and payable until February 15, 2008. You can’t sue on the second note because it’s not due yet – it’s not mature. Res judicata would not prevent you from bringing a second action on the second note because it was immature when you brought the first action.
Second Requirement for Res Judicata
The first suit and the second suit must be between the same parties (mutuality) or persons in privity with one another.
Mutuality: Both sides have to be bound or nobody is bound.
Privity: The party to the second lawsuit has the same legal interest as the party in the first suit and the second party’s legal rights relative to that interest were litigated in the former suit. People in privity relationships are considered to have interests so closely entwined that a decision involving one such person necessarily controls the interest of the second person.
Searle Brothers v. Searle
UT, 1978
Edlean Searle (D) sued Woodey Searle for divorce. The divorce court determined that a piece of property known as the "Slaugh House," which was recorded in Woodey's name, was part of the marital property. Woodey had argued that he had a half interest in the property and that the other half was owned by a partnership with his sons as partners. The court rejected that claim and awarded the entire property to his wife the defendant. Searle Brothers (P), the partnership, then sued D, to protect their interest claiming an undivided one-half interest in Slaugh House. The trial court held that res judicata and collateral estoppel barred the action by P. The plaintiff’s appealed.
For res judicata to apply, both suits must involve the same parties or their privities and also the same cause of action. Collateral estoppel arises from a different cause of action and prevents parties or their privies from relitigating facts and issues in the second suit that were fully litigated in the first suit.
Privity relates to one whose interest has been legally represented at the time. This includes a mutual or successive relationship to rights in property. In the present case, Ps' interest is neither mutual nor successive. Ps claim no part of the interest owned by Woodey Searle, but assert their own independent and separate partnership interest. The property interest arose before the commencement of the first action, not subsequent thereto, so that Ps cannot be regarded as in privity and subject to the judgment rendered therein. Also, under law, partners are co-owners of specific partnership property, which is directly opposite to successive interests. Finally, lf it could be said that Woodey Searle is Ps' agent, the rule is that agents and principals do not have any mutual or successive relationship to rights in property.
Dissent: Because Ps were sufficiently involved and interested in the divorce proceeding, they should, on the basis of equity, be regarded as parties in privity with Woodey Searle.
The Three Most Common Examples of Privity:
1. The relationship between owners of property and the relationship between owners and successive interest in property or real property.
Example: If a cottage owner is involved in litigation settling a zoning issue and I buy the cottage, I am in privity with the person I bought the cottage from – I might be bound by the results of the litigation because we have an interest in the exact same property.
2. The second most common is the representative relationships, i.e. the trust or trustee and the beneficiaries of life insurance.
3. Virtual?
Just being a family member does not create privity. Being married does not create privity. You are not in privity with your siblings. We are looking at separate people sharing a common legal interest in something.
Third Requirement for Res Judicata:
There must be a valid final judgment on the merits on the first suit.
If those three requirements are met, then the parties are precluded from relitigating the same case.
ISSUE PRECLUSION/COLLATERAL ESTOPPEL
Narrower but deeper than res judicata. It is also grounded in the same principals of judicial economy, respect for finality, avoiding inconsistent judgments thus maintaining the integrity of the system. It makes no sense to re-litigate the same question over and over again – do it once, right the first time. Collateral estoppel prohibits the same parties or sometimes other parties from re-litigating the same facts.
Example: If the second claim is a different lawsuit and not barred by res judicata because it is a different lawsuit, so long as the same facts or legal issues were decided in the first claim, then that particular issue will not be re-litigated.
The Restatement on the elements of Collateral Estoppel – What we have to establish in order to determine whether or not issue preclusion applies to a particular case:
1. When an issue of fact or law is identical in both suits;
2. The issue was fully litigated and decided in the first action;
3. The issue was determined by valid and final judgment; and
4. The determination of the issue was necessary to the judgment in the first action.
See the next page for more detail of the elements
A valid and final judgment has the same meaning as in res judicata. Most courts will find that a judgment is valid and final even if it is on appeal pending or otherwise.
The judgment doesn’t necessarily have to be on the merits.
Example: A Federal Court dismisses a case for lack of personal jurisdiction and the plaintiff brings a second suit in the same state that the first suit was brought in. Even though there was no judgment on the merits (the case was dismissed), it’s still collateral estoppel because the state court is going to say that there was no personal jurisdiction over the defendant and make the same finding.
*Don’t confuse a valid and final judgment with a decision on the merits. The distinction is: both res judicata and collateral estoppel have to have valid and final judgments but under issue preclusion it does not have to be on the merits.
*The subsequent action does not necessarily have to be between the same parties or persons in privity with those parties. It goes against the idea that one should not be bound by a judgment that one did not participate in but under issue preclusion/collateral estoppel sometimes you can.
That is the biggest difference between res judicata and collateral estoppel.
Mutual Collateral Estoppel: When the second action is between the same party(s).
Non-mutual Collateral Estoppel: A party to the second action, who was a stranger to the first action, can still be bound. It has limits because it presents questions of fairness.
The Elements in Detail
1. The issue of fact or law must be identical. As a litigant you must determine the scope of the issues precluded. Unlike res judicata which says the claim that you brought or could have brought, collateral estoppel only applies to those claims that were brought. When arguing issue preclusion you cannot stand in court and say, your honor he could have brought this issue but failed to. That works with res judicata but does not work with collateral estoppel. Basically are you arguing the same facts that were decided and resolved in the first suit? People try and re-word complaints to make it sound very different. You’ve got to look beyond what was pled in the first suit and look at the facts, then look at the second complaint. If they are trying to win on the exact same factual disputes as in the first suit, it’s the same claim.
In addition to the same facts, the same legal standards have to apply to both actions and the burden of proof must be the same.
Two Types of Burden of Proof
1. The burden of moving forward with the evidence and production; and
2. The degree of persuasion that is necessary;
a) Preponderance of the evidence (civil burden)
b) Beyond a reasonable doubt (criminal burden) Policy: we are less tolerant of mistakes when someone’s life and liberty is at stake as opposed to money damages
c) Clear and convincing evidence (used in parental rights cases)
Notes, page 687
1. No, the burden of proof is higher (like the O.J. case)
2. No, The burden of proof is lower – the government has a higher burden and people are entitled to a jury trial anyway.
3. Yes, the burden of proof in the first case (criminal) was higher.
For preclusion to apply you have to have the same claim, same legal standard, and same burden of proof.
Lumpkin case
The mayor of San Francisco appointed Lumpkin to the human rights commission. In an interview, Lumpkin said that homosexuality is a sin. The San Francisco board of commissioners insisted that Lumpkin be fired. A later reporter got Lumpkin to admit that he believes everything in the Bible and the Bible says essentially that a man who knows a man must be killed. Caving to political pressure, the mayor fires Lumpkin because the mayor took that to mean an indirect threat of violence.
Lumpkin filed civil rights suit in Federal Court in violation of 42 U.S.C. 1983. A judge dismissed the case. He filed a separate suit in state court under the California civil rights statute. San Francisco filed a motion to dismiss based upon issue preclusion.
Why would the city file under issue preclusion and not under res judicata? The judge only decided the federal question; therefore, the state case was never heard. Res judicata was not available to the city. Lumpkin argued two things:
1. The CA civil rights statute was never designed to be argued in tandem with federal civil rights, protecting a state right; and
2. The federal judge was wrong.
The court’s argument:
1. The court said that the federal judge resolved all the issues. This case had the same claim, the same legal standard and the same burden of proof – issue preclusion could apply; and
2. If the judge was wrong, then appeal.
The second judge never substituted his judgment for the first judge.
From attorney malpractice hypo: Before you can tell whether there is preclusion, you have to figure out what the standard is for a Sixth Amendment violation (ineffective counsel) and how does it compare to the common law tort of legal malpractice. My point is: you have to know what questions to ask; (1) If the standards are the same, you can use issue preclusion; and (2) were they are party or not.
Illinois Central Gulf Railroad v. Parks
IN, 1979
Parks (P) and his wife were injured when their car collided with an Illinois Central (D) train. P's sued and the wife recovered $30,000 on her claim for damages. The judgment was rendered for D on P's own claim for damages for loss of services and loss of consortium of his wife. P then sued D to recover damages for his own injuries. The trial court held that P's claim was not barred by res judicata, and that the prior action did not collaterally estopp P on the issue of contributory negligence. The trial court held that it was not possible to determine if P lost because he was contributorily negligent or because he could not prove his damages. D appealed.
The husband’s claim is derivative: his wife has to win in order for him to win.
The husband suffered personal injuries as well and he brings another lawsuit. Why wouldn’t the railroad prevail on res judicata? He was a party after all.
Indiana in 1975 didn’t follow the Transaction Test.
The court reasoned (from Emanuel page 255) that plaintiff could have lost either because he was contributorily negligent or because he suffered no damages. Although the contributory negligence issue was the same in both suits, damages would differ for the different claims.
Most verdicts are simply general verdicts – you have no idea what the jury based its decision on. Or you can ask for a special verdict – asking the jurors to give findings on each submitted issue under Rule 49, Special Verdicts and Interrogatories.
To avoid this problem, the railroad could have asked the jurors to answer each question separately to try and flush out how contributorily negligent the husband really was. It keeps jurors from feeling too sorry for a plaintiff.
Benson: The upshot of the case: If a judgment could have based upon a determination of two or more matters of fact or law, (he could of suffered damages or that he was contributorily negligent) and the party in the second suit what wants to invoke collateral estoppel based upon one of those matters, the party must prove that the jury actually rendered judgment on the determination of those set of facts as opposed to the determination of another matter.
Under a general verdict form that is virtually impossible (page 689).
Collateral estoppel must be based on factual matters that are actually litigated, decided, and necessary. If the person invoking collateral estoppel cannot show that it was actually decided, then issue preclusion does not apply – they will lose that motion.
To determine whether an issue was necessary to support a judgment, ask yourself: if the issue was decided the opposite way, would the same judgment have been entered? If the answer is yes, then it wasn’t necessary – the judgment did not depend on those issues.
Car accident example: P sues D claiming D was negligent. D defends on contributory negligence (total bar of claim). The jury comes back and says D was negligent but also finds P contributorily negligent. Assume this state has no compulsory counterclaim rule. Now D in old suit sues P in the new suit. The D says, issue preclusion – the jury found that you were negligent; therefore as a matter of law, you had to have been contributorily negligent. Is the P (former D) going to lose because the jury found that he was contributorily negligent? No because the finding that the original D was negligent was not necessary to the judgment because the plaintiff was found contributorily negligent – standing alone, that results in a no cause. The P would have lost regardless.
This is one of the reasons courts compel people to bring their counterclaims.
MUTUALITY
Non-mutuality: A concept that says sometimes someone who was not part of the first lawsuit can be bound.
What protections are in place to make non-mutual collateral fair to those parties?
Hypo: Sue one neighbor for nuisance (kids bouncing balls all day) and I loose. I sue another neighbor and loose that case. I sue another neighbor and loose. At what point does the court tell me to give it up? That’s what collateral estoppel is all about.
Part 2: If I sue one neighbor on the issue of kids bouncing balls all day, and I loose that issue. I then sue a second neighbor, who is a stranger to the lawsuit, but can the second assert collateral estoppel against me? The court will ask why it should try the same lawsuit every time. It is not unfair to hold me to that earlier adjudication.
*Part 3: What if I sue the first neighbor and I win? Then I sue my second neighbor. Is it fair to bind the second neighbor? No, using offensive non-mutual collateral estoppel is not fair. The doctrine is supposed to limit the amount of litigation.
Patent infringement hypo: Company P sues Company D for patent infringement and the first court said that P’s patent was invalid and lost. They then sue someone else alleging they were infringing on their patent. The other person argued that your patent is not valid as determined by the first court. The United States Supreme Court said it is not unfair to bind a second judgment based on the first one. Company P would continue to loose based upon an invalid patent.
The Wait-and-see Attitude
Parklane Hoisery Co. v. Shore
Supreme Court, 1979
Ripped-off shareholders file a civil action against Parklane. In a second civil suit the SEC sued Parklane (D) for issuing a materially false and misleading proxy statement of a dummy corporation used to inflate the stock price. The SEC’s case went to trial first. Both the shareholders and the SEC have to show the same thing to win but what the shareholders have to show that the SEC doesn’t is damages.
The shareholders try to use offensive non-mutual collateral after the SEC wins. It was already determined and the shareholders wanted a partial summary judgment – they want to try the case on damages alone.
The Supreme Court went from a bright-line rule (offensive non-mutual is never allowable) to replacing it with the discretion of the trial court with specific instructions to scrutinize very, very carefully to insure that it is fair to the defendant against whom it is being asserted (the party in the first litigation).
Offensive non-mutual use has proven more problematic, and accordingly its use is subject to greater limitations. The Supreme Court expects district court judges to explore and find other judgments and then look to see if they are inconsistent.
The Supreme Court’s decision discusses the problems with offensive use. The two main problems are:
1. Wait-and-see. In this case there was no real wait-and-see, the shareholders sued first and it wasn’t in their control to join in the SEC’s suit anyway.
2. Efficiency concerns. Non-mutual offensive presents the risk of inconsistent judgments. Different courts could reach different conclusions concerning the same basic issue.
Benson: The offensive use of non-mutual collateral estoppel must be regarded and treated differently from the defensive use. The defensive use is going to be more often successfully invoked because it’s usually fair. The offensive use is going to be scrutinized a lot closer but it’s allowable.
State Farm Fire & Casualty Co. v. Century Home Components
OR, 1976
A fire started in a shed owned by D. It spread to other properties in the area. Eventually over 50 separate actions for damages were filed against D to recover losses from a fire. Three of the actions proceeded separately through trial to final judgment; a judgment was awarded in favor of D, and the other two judgments went to the claimants. State Farm (P) stored some of its property in a warehouse just sixty feet from D's shed and the fire destroyed P's property. P, and other parties, who was not a party to any of the previous actions, sought to utilize the prior claimants' judgments to establish D's negligence and its responsibility for any losses caused by the fire. Ps all filed amended complaints to match the cases in which D was found to be negligent. D, of course, asserted that it had a favorable ruling in one of the cases. The trial court held that D was collaterally estopped from any further contesting its liability.
ISSUE: When prior judicial determinations on a particular matter are inconsistent, does the doctrine of collateral estoppel bar re-litigation of that matter?
No. In every situation where collateral estoppel is asserted by a person who was neither a party nor in privity with a party to the prior case, it is essential to determine that no unfairness will result to the prior litigant if the estoppel is applied. Also, we are not free to disregard incongruous results.
Emanuel:
The court refused to allow offensive use given the inconsistent results in prior cases against the defendant.
It is important to remember that the relaxation of the mutuality requirement applies only against people who were parties in both actions. It is a violation of due process to use claim or issue preclusion against someone who was not a party in the first place. The due process clause entitles people to their day in court.
LAW OF THE CASE
Law of the Case: There is a case at the trial court level and the case gets either appealed to the court of appeals or the Supreme Court. The case then gets remanded to the trial court for further proceedings. The decision of the appellate court becomes “the law of the case.” The parties are not permitted to re-argue whatever issue the court has finally resolved. It’s a little bit like claim preclusion and collateral estoppel – you’re not allowed to re-argue the issue.
It is a common law doctrine and it is fairly aggressively followed but not absolute. Appellate courts do not like it when people argue issues that were already resolved in trial court. Once the court of appeals has resolved an issue and sends it back to the trial court, the trial judge may not revisit the issue even if the court of appeals is wrong.
JUDICIAL ESTOPPEL
Judicial Estoppel: it is also a common law concept. It varies from state to state and some states do not even recognize the doctrine. If a party takes a position of fact in one lawsuit and the court acts on that position, if that party obtains a favorable decision based upon this representation of fact, he may not take in a subsequent proceeding a contrary position – he is judicially estopped.
In the modern rules of pleading you can take alternative positions in one lawsuit – you can plead both factual and legal in the alternative but you can’t try your case in the alternative – at some point you have to take one position.
Example: I own the dog but the dog was provoked and you win the lawsuit. In a subsequent lawsuit you deny ever owning a dog. Now you are running into a problem. You’ve gone on the record, under oath and you’ve taken a factual position and you won that case. Now in subsequent litigation you’re taking a factual position that is contrary to the first position.
Most states, including the federal government will prevent you from doing that – it’s judicial estoppel. The two most common elements are:
1. The factual positions must be opposite from one another There must be direct contradiction between the two positions
2. The first case had to end favorably for the person taking the position.
Example: Suit against an insurance agent and insurance company (Allstate). In another county (Wayne) Allstate was arguing the opposite factual position. The brief was shown to the judge but he said the Wayne county judge was wrong – he is right but the other judge was wrong and Benson lost.
Tip: When dealing with national corporations, check out their litigation in other venues.
A small minority of the states do not require that the first action end favorably. Judicial estoppel is generally confined to the facts. A corporation may take other legal positions – it makes them look bad, but it may not necessarily be judicial estoppel. It’s when they take positions of fact.
DISCOVERY
Discovery is a common law concept borrowing from the court of equity. American discovery rules are extremely liberal. Federal Courts have tried to limit discovery because it can be abused.
Informal Discovery
Under Rule 11 you are required to do an investigation before you file your complaint. So what do you do? Call witnesses, call opposing counsel, get police reports, get ambulance reports, freedom of information reports, etc.
Formal Discovery
Doesn’t kick in until the complaint is filed. The days of trial combat are over. No matter how honest your client is, there is a large body of information that your client doesn’t know.
Reasons for Discovery
Discovery very often leads to settlement. Most attorneys know who is going to win and who is going to lose. It narrows the issues through the pleadings. Discovery has the ability to flush out where the parties disagree and where they don’t disagree. You learn about your opponent’s case, you’re avoiding surprise, and you’re posturing your case for settlement and you’re also posturing your case for a possible motion for summary judgment.
The Downside
Another aspect for discovery is the illicit purpose of driving your opponent into bankruptcy. Example: Loss of consortium claim. Opposing counsel will abuse discovery to humiliate your client. If you allege it, the defense has the right to explore it. There’s an ugly side to discovery so don’t ever do anything thoughtlessly and just throw it into a complaint.
Length of Discovery
How long discovery lasts varies from court to court. In a small case 3 months. Typically it’s 8 months to 1 year in a large case. The scheduling order will set forth deadlines, discovery being one of them. Please meet those deadlines. Usually upon motion a court will extend
Scope of Discovery
26(b) Discovery Scope and Limits.
Unless otherwise limited by order of the court in accordance with these rules, the scope of discovery is as follows:
(1) In General.
Parties may obtain discovery regarding any matter, not privileged, that is relevant to the claim or defense of any party, including the existence, description, nature, custody, condition, and location of any books, documents, or other tangible things and the identity and location of persons having knowledge of any discoverable matter. For good cause, the court may order discovery of any matter relevant to the subject matter involved in the action. Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence. All discovery is subject to the limitations imposed by Rule 26(b)(2)(i), (ii), and (iii).
(2) Limitations.
*Benson: The limitation is relevance. Relevance is an evidentiary concept meaning any item or information that makes the fact of consequence in the trial either more likely to exist or less likely to exist relevant. It is any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable. It is a very low burden and is very broad. At some point you get an idea of what is relevant and what is irrelevant. Is this information likely to show the existence or nonexistence of something?
In discussing the scope of discovery, in order to know if something is relevant you have to know what the theory of liability is, you have to know what the defense is. If you don’t know what the theory of liability is or what the defenses are, you will never know whether something is relevant. That’s what makes discovery challenging to law students because not only do you have to know the scope, but also you have to remember what the elements of negligence are, the elements of breach of contract, etc. In civil procedure, you go into a deposition and you are not always 100% sure what your own theory is much less your opponent’s theory, but you’ve got to understand the basic theory of your case before you can understand the scope of discovery. You have to understand the substantive law.
Tip: For depositions, pull out your jury instructions to find out what you have to prove.
In discovery it doesn’t matter if it’s admissible or not. Hearsay is a valid objection at trial but not in discovery.
The most common objections to discovery requests:
1. The information sought is irrelevant
2. The information sought is privileged
3. The information sought is overly burdensome It might be marginally relevant that the amount of time, cost, and energy that will go into producing this information is too burdensome.
Davis v. Precoat Metals
ND, 2002
Davis (Ps) are African-American and Latino employees who worked at Precoat's (D) Chicago plant. They allege they have been exposed to a hostile work environment. They allege they are subjected to racially insulting and derogatory remarks by D's management level employees. Ps also allege that D has discriminated against them in terms of entry level placement, work assignments, promotions, and discipline and that D retaliated against them for complaining about those practices. Ps noticed D for discovery over a narrow period of time related to all racial discriminatory complaints at the plant where Ps worked. D refused to answer and P had to motion to compel.
This is a fairly common request and a fairly common objection. The plaintiffs were asking for discrimination complaints made against the defendant from 1998 to 2002.
If you were defending this case, and you get this discovery request, what would your objection be? Ask yourself, what do these people have to prove and is any of this information going to make any “fact of consequence” any more or less likely to exist? One of the things they have to show is actual discrimination against them – not that the company is a bad company.
If you ask for complaints from the last 10 years, that doesn’t go to show that the company mistreated you. Even if you found some statistical evidence, it doesn’t go to whether or not the company mistreated you personally. Are patterns of past misconduct considered evidence? Can that be used to draw an inference? The court says yes, the plaintiffs are correct that other employee’s complaints of discrimination may be relevant to establish pretext (an excuse for what is really going on). Patterns can be used – it doesn’t conclusively prove anything but patterns can be used to draw an inference of actual discrimination on a particular occasion.
The plaintiff’s lawyers were smart; they limited the scope, they weren’t asking for everything.
All of these arguments are tied directly to the theory of the case and the theory of the defense. The plaintiffs would never have gotten out of the gate unless they cited McDonnell v. Green (1973) – evidence of a pattern can be used to draw an inference as to racial discrimination on a particular occasion. You have to argue the theory of the liability. You have to know the law. When in doubt the courts will always allow you to get the information.
Discoverable information is not defined by what is admissible at trial. Discoverable information is relevant if it appears reasonably calculated to lead to the discovery of admissible evidence. This does not give any plaintiff a carte blanche as a court can limit discovery if it determines that the discovery is unreasonably cumulative or duplicative, obtainable from other sources that are more convenient, less burdensome, or less expensive, or the burden or expense of the proposed discovery outweighs its likely benefit. Rule 26(b)(2).
Rule 26 gives judges extraordinary discretion and can even prevent parties from even getting relevant information – the party must make the case.
Steffan v. Cheney
DC, 1990
NATURE OF THE CASE: This was an appeal from the dismissal of an action for wrongful (constructive) discharge from the U.S. Naval Academy. The action was dismissed for a failure to comply with a discovery order.
FACTS: Steffan (P) was involved in an administrative action for his dismissal from the Naval Academy because of his admission that he was homosexual. He was not discharged for any homosexual conduct. On a hearing for reinstatement, P claimed his Fifth Amendment privilege against self-incrimination and refused to answer a deposition question on whether he engaged in homosexual conduct during or after his tenure as a midshipman.
P also objected in that the questions were not relevant to the legality of his separation. The court held that the questions were relevant because the Navy could refuse reinstatement on the grounds an individual has engaged in homosexual acts. The district court dismissed his case for failure to comply with its discovery order. P appealed.
This all goes back to understanding the theory of the case. These are legitimate questions. If the plaintiff admits under oath that he has engaged in homosexual activities, that is a violation of the rules and regulations and the Navy doesn’t have to re-instate him back into the Navy. This comes out because of the substantive law he was arguing. I was fired by not what I had done, but who I am.
When faced with the question at a deposition, he refused to answer the question. The question was relevant. He claims privilege and privilege is only an issue if it’s relevant. He invokes the Fifth Amendment and he wins on appeal. The court says that it is not relevant
Wrongful termination example due to race or gender discrimination: The defendant asks you, while you were working for us did you get an email from your husband asking you to pick up the kids? You answer yes. They file an amended answer stating, we have a strict policy of no personal emails at work. Now that we have evidence of your misconduct while at work independent of your race or gender that would have resulted in your discharge, you have no damages because we can fire you for taking that email from your husband. Benson: That is valid and it is upheld everyday.
What is the difference between the example and this case? The difference is the law. You’ve got to know the law. Steffan was dismissed by an administrative board and the rules are different from private companies.
So what is the law? The law says that an administrative board has all sorts of discretion but judicial review is limited. They can only review the reasons stated by the board for the dismissal and in this case he was dismissed because he declared himself a homosexual period. Whether he engaged in homosexual activities is irrelevant because under the law of this case it is irrelevant.
This is an unusual case because the judicial review is so extraordinarily narrow. It’s usually not that narrow but it is in this particular case.
PRIVILEGE
Privilege generally means that certain types of communications are not discoverable nor are they admissible. There are many different types of privilege, i.e. attorney-client, doctor-patient, priest-penitent, trade secrets, etc.
Attorney-Client Privilege: The oldest common law privilege. It is designed to allow a represented party to be able to speak fully and frankly without fear that what is said to an attorney will be used against them.
In a criminal case it has a constitutional dimension (Sixth Amendment), people have a right to effective counsel and it cannot be effective unless there is a privilege.
Do not mistake the concept of privilege with the model rules of professional responsibility that says that you have to keep your client’s secrets. Privilege is very narrow; it only protects certain communications between the attorney and the client. Ethically you have to keep your client’s secrets. The privilege only attaches to the communications. Not just any communication but those communications which both the client and the attorney reasonably and objectively meant to be privileged or confidential. It is your responsibility that the client understands that these communications are intended to be confidential – making an effort to keep the communication confidential when around third parties.
A reasonable person must recognize that this communication is intended to be confidential. The client owns the privilege which means the client can waive it. The lawyer can invoke the privilege for the client.
Depositions. In a deposition there are very few valid objections because the court will decide if something is admissible or not. Privilege is a different matter. If you allow your client to answer a privileged question, you have waived it forever. You cannot invoke the privilege, refuse to answer the question and then later try to introduce that communication in trial.
If you claim compensation for injuries, your past and present medical records are discoverable. With certain types of lawsuits, you waive certain types of privileges.
Privilege only protects the communication and not facts (running a red light for example) that may be in the communication.
Exception to the Attorney-Client Privilege: The Crime/Fraud Exception. Anytime a client is communicating with a lawyer for the purpose of committing a crime, that communication is not privileged.
During the course of discovery, the attorney inadvertently discloses confidential communications. The majority of the courts will allow a one-time inadvertent disclosure – it is not a waiver. If it is routine, the courts can find for a reckless waiver.
Spousal privilege. Two forms:
1. Testimonial privilege. If a man and a woman are married, one spouse cannot be compelled to testify against another spouse.
2. Spousal privilege. After a man and a woman have divorced, if there is a communication made during the marriage that both parties understood was confidential, the testifying spouse cannot disclose any communication that was meant to be confidential between husband and wife while they were married.
The old common law rule was that non-testifying spouse could invoke the privilege. The rule was changed so that the testifying spouse could invoke the privilege.
Fifth Amendment
No person shall be compelled to be a witness against himself. A prosecutor cannot call a criminal defendant to the stand unless the defendant has been called to the stand by his or her attorney. No may a prosecuting attorney mention or comment to the jury of the defendant’s refusal to take the stand.
Fifth Amendment in a civil lawsuit general rule: The US Supreme Court says you may invoke it after all it is the government enforcing all of these rules; however, since the states are lower and it would be a private party using the Fifth Amendment to try and gain an advantage over another private party, the lawyers can comment to the jury that this person refuses to testify or that this person must be hiding something. “If he’s so innocent, why doesn’t he take the stand?” But you run the risk of a default judgment. You invoke it at your own peril in a civil suit.
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Butler v. Rigby
US District Court, LA, 1998
FACTS: There was an auto accident. Butler (P) and other plaintiffs got medical treatment from American Medical Group (AMG) and Midtown Health Center (MHC). These groups were doctors who provided medical treatment to all of the plaintiffs. D filed a notice of deposition and requested certain documents regarding the nature of the relationship between the doctors and the attorneys representing Ps. Rigby (D) wanted documents that listed the total number of patients treated by the doctors since 1992 that were involved in the present lawsuit and a list of patients referred to the doctors by specific personal injury lawyers.
AMG and MHC moved for a protective order prohibiting D from discovering that information based on the grounds that the relationship between the doctors and the lawyers were not relevant to the suit, that some of the information was protected by the doctor patient privilege and that the request was overly burdensome
D argued that the information was relevant because it would show that the doctors had received money from lawyers who had represented P. The magistrate ruled that most of the information was discoverable. AMG and MHC objected and asked for a ruling from the district court. Rule 26(c) protects nonparties to a lawsuit from discovery and allows those nonparties to move for a protective order. Rule 26(b)(1) sets the scope of discovery as any matter not privileged which is relevant to the subject matter of the pending action. Rule 26(b)(2) protects parties against unduly burdensome discovery.
The defense wants some information from a non-party. Rule 45 gives all attorneys the power to send subpoenas to people. The defense wanted the identity of the patients treated by the doctors since 1992 that were involved in the present lawsuit and a list of patients referred to the doctors by specific personal injury lawyers. They want to know how closely these doctors work with these particular attorneys. Is that relevant?
Relevant Issues:
The credibility of a witness – the believability of a witness is always relevant in any adversarial proceeding. With that in mind, the defense wants to know how many cases had been referred to the doctors by the plaintiff. The witness’s credibility is always at issue and what bias means is, does the witness have a relationship with one of the parties such that the witness had a motive to color his or her testimony in favor of that party. 80% of the doctor’s income came from these attorneys. If my income depends upon this lawyer, I’m not going to say his client is just fine very often. He has a motive to over exaggerate the injuries and is relevant to his credibility.
It doesn’t mean that the doctor is a liar or is in cahoots with the lawyer but there is an inference that they might be. It’s relevant and they permit it. It may not be permissible down the road but it is discoverable. If it’s irrelevant, you don’t have to talk about privilege because it’s neither discoverable nor admissible. Privilege is only a problem when something is relevant and privilege can keep out relevant facts: “Did you kill your wife?” – Fifth Amendment privilege.
The names are privileged because there is a statute that says it is privileged. The names of the patients were not relevant except for discovering other possible witnesses, therefore relevant because the other lawyer wants to call them but due to HIPPA laws you’re not going to get the names nowadays.
VEHICLES OF DISCOVERY
1. Required disclosures, Rule 26(a)
2. Depositions, Rule 30
3. Written interrogatories, Rule 33
4. Request for production of documents and things, Rule 34
5. Mental and physical examinations, Rule 35
6. Request of admissions, Rule 36
Required Disclosures Rule 26(a)
It requires that the parties disclose certain information to each other automatically. There is certain information that must be disclosed. The initial disclosures must be made within 14 days of the 26(f) conference. Benson: Need to know – Required Disclosures under Rule 26:
Level 1 (a)(1) Initial Disclosures:
• Names, phone and addresses of supporting witnesses (likely to have discoverable information).
• Copy or description of supporting documents
• A computation of damages (Plaintiffs)
• Any insurance agreement (Defendants)
Level 2 (a)(2) Expert Disclosures:
• Identity of experts
• An expert report including:
• Signature
• Complete opinions
• Reasons and basis
• Data considered
• Exhibits to be used
• Qualifications (including publications for 10 years)
Level 3 (a)(3) Pretrial Disclosures:
A. Name (and address/phone if not previously disclosed) of
“Will call” witnesses
“May call” witnesses
B. Designation of testimony of non-live witnesses
C. Identification of all exhibits
Rule 26(f): Starting the process of civil litigation
The parties must as soon as practical and in any event at least 21 days before the scheduling conference found in Rule 16(b). The 26(f) conference is a conference you must conduct with the attorneys or non-represented parties outside the presence of the court. In other words, this is a meeting you prepare for the conference you have with the court and it must be done no later than 21 days before the pre-trial conference which is found in Rule 16. Rule 26(f). Basically the court forces parties to come up with some sort of a plan for litigation – if everyone can agree it makes the court’s job much easier. You then have to make the initial disclosures in 26(a)(1) within 14 days of that meeting.
New Change for 26(f):
Rule 26(f) adds E-discovery issues to the topics to be addressed in the Rule 16 Conference Report
You may not make a formal demand for discovery before the 26(f) conference. This is a private conference without the presence of the court.
You discuss the nature of the claims and the defenses
You explore the possibility of settlement
You make arrangements for the initial disclosure; in other words, you discuss how and when that is going to happen and must be done within 14 days
You discuss what needs to be disclosed
You argue what the law requires of you.
You then develop a proposed discovery plan:
1. Should you make any changes to the disclosure rule? You can decide your own disclosure plan within reason.
2. Discuss how long you want it to remain open. What limits if any. You can decide the number of depositions.
For the most part, courts will honor and enforce any reasonable stipulation you come up with.
Rule 26(a) breakdown of terms
Impeachment: Any evidence that tends to diminish a person’s credibility. Any evidence that can be used to draw into question the believability of a witness is considered impeachment. If you have a witness for impeachment purposes only, you don’t have to disclose that witness in the initial disclosure (but you may be required to later).
Documents: Parties are required to provide a copy of or description of category of all documents he may use to support his claim or defense.
Damage Computation: Must do a computation of any category of damages claimed and all non-privileged documents supporting that computation.
Evidence of Insurance: If you are a plaintiff, you want to know if defendant is covered by insurance.
Expert Witness: 26(a) also requires disclosure involving expert witnesses and expert reports. Each party must disclose the identifying of its testifying experts. It is common to hire experts that assist in the litigation and you do not have to disclose the non-testifying experts, it’s part of work product and strategy. The scheduling order will always require you to disclose your experts.
Lay witness: A person that can only testify as to that person’s personal knowledge – what did that person see, hear, taste, touch.
Expert witness: A person that is qualified to give opinions about things he or she has no personal knowledge of. (A ballistics expert didn’t see the bullet come out of the gun but can opine that it came from a certain gun)
Expert report: Must include a complete statement of the expert’s opinions, the basis and the reasons for the opinions, information considered in forming the opinions, any exhibits to be used by the expert, qualifications of the experts, how much the expert is getting paid and any other case in which the expert has testified within the last four years. Very comprehensive stuff.
11th Circuit, 1997
Heaven (P) leased a Ford Taurus from Sun Trust (D) by signing a preprinted lease form. Plaintiff sued defendant because she alleged that defendant failed to comply with the strict disclosure requirements of 15 U.S.C. Section 1667-67e and Regulation M. plaintiff sued for the statutory penalty and fees but alleged no actual damages. Plaintiff sought to certify this lawsuit as a 23(b)(3) class action. Defendant counterclaimed that the individual class members had defaulted on the terms of their leases or made false statements in their lease applications. The district court denied certification on the ground that the counterclaim required individual responses from plaintiff’s class and, thus, destroyed the superiority and manageability of the class action. Plaintiff appealed.
This is a basic common breach of contract claim. The rule that this case turned on was the need for individual responses will make management of the class action difficult under Rule 23(b)(D). It defeats the whole point of a class action lawsuit when the court has to in effect make separate determinations for each and every member of the class. A class action is designed to resolve wide-ranging problem in one fairly efficient lawsuit.
Hansberry v. Lee
Supreme Court, 1940
FACTS: In a prior case involving a racially restrictive covenant, the Illinois Supreme Court determined that the covenant was valid and that because the action was a class action, all members of the class would be bound by the decision of the court. Hansberry (D), a black, purchased land from a party who had signed the same restrictive covenant forbidding the sale of the land to blacks. Lee (P), one of the parties to that covenant, sought to enforce the covenant based on the prior case involving the same covenant. D claimed that he and the party selling him the house were not bound by the res judicata effect of the prior decision, because they were not parties to that litigation. D alleged a violation of their due process rights. The court held that the prior decision of the Illinois Supreme Court would have to be challenged directly in order to have it set aside or reversed. The court held that the prior action was binding on D. The case was appealed to the U.S. Supreme Court.
The covenant by its terms was effective if signed by 95% of the landowners. The parties to a previous action involving the covenant stipulated that 95% had signed when in fact only 54% had signed.
Why are we here if only 54% have signed rendering the covenant unenforceable? In the earlier case the people fraudulently stipulated that 95% had signed it.
RULE OF LAW: A judgment is binding on all members of a class in a class action only if there was adequate representation of them. Not all members of a class need be present in order for a class action judgment to be binding upon them. When a class member has not been adequately represented, giving res judicata effect to that judgment violates Due Process.
Res judicata: The thing is decided. Once a lawsuit is resolved, it’s resolved. You can’t keep filing lawsuits hoping that you will win.
Hansberry’s argument to the res judicata argument is, it’s not fair. I had no knowledge of the lawsuit; I had nothing to do with the lawsuit.
The only time that the Supreme Court gets involved with state issues is when it violates the Constitution. He had property and the state took it away from him; therefore, violating his due process right.
The Fourteenth Amendment says the states cannot take away your property without due process. The Fifth Amendment says the government cannot take property without due process.
Hansberry made the exact same argument to the Illinois Supreme Court. The Illinois Supreme Court said that he was a member of the prior class action – the class was the people with the exclusion clause in their deeds – and even though nobody called it a class action suit, he was bound by it nonetheless.
The Supreme Court raises this issue to a constitutional right. Illinois had no right to deprive Hansberry of his property without due process and the Court found that there was no one who represented Hansberry’s interests because the plaintiffs in the prior action sought to enforce the covenant whereas Hansberry in the present action seeks to resist enforcement. Each belongs to a different class because they have opposing interests.
What we are really exploring here in these class actions is the constitutional underpinnings of class actions. Class action is a vehicle by which people, who might not even know about the suit, could potentially have their rights taken away from them and that raises constitutional questions. Lee v. Hansberry was a specific constitutional issue and we see that any class action – even if it is a purely state law, state court class action law suit – it has its constitutional implications because of the way people’s rights can be affected. The United States Supreme Court makes very sure the constitutional rights are protected.
Phillips Petroleum v. Shutts
Supreme Court, 1985
Phillips was a plaintiff class action in a Kansas state court in which a representative sued an oil company on behalf of a class of 33,000 people who, plaintiff claimed, were owed royalties by Phillips under oil well leases. Phillips argued that because in many cases neither the owner nor the oil well was in Kansas, there were no minimum contacts sufficient to allow Kansas to adjudicate the claims.
Benson: The reason why you have never seen a case where personal jurisdiction over the plaintiff is an issue is because the plaintiff, by filing the lawsuit, automatically consents to jurisdiction. This case is different – you’ve got a class – and not everybody in this class consented to jurisdiction. So the defendant is saying: you don’t have jurisdiction over these plaintiffs because they never consented and they don’t have sufficient minimum contacts with the state of Kansas.
What the defendant is saying is that by certifying the class and by hooking into the class people over whom you have no jurisdiction, that violates the Constitution; therefore, it was wrong to certify the class.
Opt in vs. Opt out
In order to solve the problem, the defendant says: by forcing people to opt in, they’re forced into consenting to jurisdiction. If they opt in by consent, they are consenting to jurisdiction.
Note: Although a party usually may not challenge a court's lack of jurisdiction over other parties, the Court allowed Phillips to assert the defense. After all, if Phillips were to prevail in the case, it would want the judgment to bind all members of the class. However, the judgment could bind the absent members only if the court had personal jurisdiction. Phillips didn’t want a bunch of people suing them after they have spent millions defending and settling to suit, to come and say, you didn’t have jurisdiction over me and sue them separately.
Supreme Court holding: The Supreme Court held that the Kansas court could exercise jurisdiction over the absent members of the class. Although due process usually requires minimum contacts, the Court held that certain protections afforded by the class action device served as a substitute for minimum contacts. The Court noted the following features of class actions:
A. the lack of any burden on the member to travel; instead, the burden of litigating the claim would be borne entirely by the representative;
B. the guarantee of adequate representation of the members' interests;
C. the provisions in Fed. R. Civ. P. 23 guaranteeing the members notice and the opportunity to opt out of the class;
D. because courts would rarely allow a defendant to file a counterclaim against members of the class, the class action would result in no money judgment against the members.
Note: The Court did remand the case to the Kansas courts, but for another reason. The Kansas courts had applied Kansas law to every claim. The Court held that Kansas could not constitutionally apply Kansas law to claims that had no connection whatsoever with that state.
Limits of holding: Broadly read, Phillips could make personal jurisdiction a non-issue in class actions. However, the Court's opinion contains several significant limitations.
a. Defendant class action: Phillips was a plaintiff class action. In theory, the rationale could apply to cases where a plaintiff sues a class of defendants. On the other hand, members of a defendant class would be subject to a money judgment. The Court specifically refused to deal with this question, stating in footnote 3 of the opinion that the opinion “does not address” defendant class actions.
b. Nondamages class actions: Nor did the Court express an opinion concerning other types of class actions, such as those seeking specific relief. Again in footnote 3, the Court suggested that the result in those cases could be different. This limitation is especially important because, as discusses below, Rule 23 does not guarantee members of a 23(b)(1) or (b)(2) class either notice or the right to opt out, two features of class actions that were important to the rationale of Phillips.
Benson: The moral if this story:
1. You have to give a chance to opt out;
2. The class has to be adequately represented; and
3. You have to give notice and an opportunity to be heard in accordance with Mullane. Mullane didn’t say actual notice, it said it had to be reasonably calculated to give actual notice.
Venue
Apply the venue statute to the class representatives.
Diversity
Look to the class representatives, not every member of the class. So long as the plaintiff class representatives are diverse from the defendants, you’ve got diversity. This was changed by the Exxon case. Under supplemental jurisdiction, the courts will entertain the claims of each member of the class.
In 2005 Congress passed the Class Action Fairness Act. The perception was that too many state courts were entertaining too many class action lawsuits. Some states had reputations of granting multimillion dollar awards in class actions. After much lobbying from manufacturers, the act was passed. Essentially it makes it a whole lot easier to bring/remove a class action into Federal Court.
Amchem Products, Inc. v. Windsor
Supreme Court, 1997
FACTS: The class in this asbestos action proposed for certification potentially encompassed 100,000's and maybe even 1,000,000's of parties. All of the parties were exposed to asbestos products manufactured by 20 or more different companies. There was no litigation intended for this class as the settling parties presented a complaint to the District Court, an answer, a proposed settlement agreement, and a motion to conditional class certification. Various class members raised objections and the judge granted them full rights to participate in the subsequent proceedings. Their main objection was that the settlement unfairly disadvantaged those with currently compensable conditions, it failed to adjust for inflation, and in advances in medical science. Objections were also made with respect to 23(a)(4), wherein the class counsel and class representatives had disqualifying conflicts of interest. The contention was that parties with injuries and parties currently without any injuries should not be represented by the same counsel. The court conditionally certified under 23(b)(3). The United States Court for the Eastern District of Pennsylvania certified the class for settlement only finding that the proposed settlement was fair and that representation and notice had been adequate. The Court enjoined members of the class from separately pursuing asbestos related suits in any court, federal, or state pending the issuance of a final order. Ds appealed that decision and the Third Circuit held that class certification failed to satisfy Rule 23's requirements. It found that serious intra-class conflicts precluded the class from meeting the adequacy of representation requirement under 23(a)(4). The Supreme Court granted certiorari.
Issues:
1. Do the requirements of Rule 23(a) and Rule 23(b)(3) fully apply to certification of settlement classes?
2. Is the proposed settlement class fair to future, unknown class members; i.e., should it be certified?
As Justice Ginsberg points out, Congress basically dumps this on the third branch of government and relies on the Supreme Court to figure this out.
Justice Ginsberg is concerned about the sliding scale of settlements. Because the settlement class will lack the ability to adjust the class, rules designed to protect absentees are vitally important. The settlement provisions directly impact whether the settlement is “fair.” If “fair,” then certification is proper.
The proposed settlement class action cannot be certified because it does not satisfy Rule 23(b)’s requirement that common questions of law or fact predominate. The predominance requirement is not met by the fact that all asbestos victims may share an interest in expeditious resolution of their claims. Also, Rule 23(a)(4)’s requirement of adequate representation is not satisfied because the “inventory” plaintiff’s claims were traded off against the “futures” claims.
ERIE DOCTRINE
The Erie Doctrine addresses when to apply federal law and when to apply state law. The Erie Doctrine mainly applies in diversity cases. If it’s a federal question there is no question that you apply federal law.
Article III
1789 Rules of Decision Act: in cases where the Federal Court is sitting in diversity, “the laws of several states, except where the constitution, treaties, or statutes of the United States shall otherwise require or provide, shall be regarded as the rules of decision.”
Right out of the gate, Congress’s message to the Federal Courts was, if it’s not a federal question, apply the state law of whatever state you’re sitting in.
This was complicated dramatically by the Tyson v. Swift decision (1841). The basic holding of Swift was that Federal Courts were not bound by the Rules of Decision Act to follow state judicial opinions on most legal issues. Instead, a Federal Court could make an independent interpretation of what that common law rule was on the particular subject. If there is a local custom or something immutably tied to the state such as real estate, then we apply state law. If it is a matter of general commercial law, we don’t have to follow the Supreme Court decrees of general commercial law.
One philosophical approach of the day was that judges did not make law, they found law. The other approach was that the Supreme Court can make law; therefore, we should follow them.
The Swift v. Tyson court had some practical applications in mind. Most notably was uniformity. They wanted to see a system where the laws of the United States of America were generally uniform – there shouldn’t be one law in Rome and another in Athens. Swift’s underpinnings were false. The states were just not that impressed with the federal judges and their federal common law. We had the exact opposite. We had two very different systems – federal law in one direction and state law in the other. The problem was forum shopping.
Erie Railroad v. Tompkins
Supreme Court, 1938
The plaintiff in Erie was hit by a train while walking along the tracks of defendant railroad. He sued the railroad in a federal district court based on diversity jurisdiction, claiming that the railroad had acted negligently by leaving the door to one of the cars open. The accident happened in Pennsylvania.
Clash of laws: Under Pennsylvania law, plaintiff could recover only upon a showing of “wanton” negligence because he would be considered a trespasser on the railroad’s right-of-way. Plaintiff, however, argued that the federal court should apply the “general” or federal common law rule, which required the railroad to act with ordinary care.
Mr. Tompkins wisely chose the Federal Court system because the Federal Court was more advantageous to him. What they are also arguing as a matter of Pennsylvania was such that
Holding: The Supreme Court held that the lower court was obligated to apply Pennsylvania’s wanton negligence standard.
Rationale: The court overturned its earlier holding in Swift, finding that the reference to laws in RODA included not only state statute law, but also state judicial opinions interpreting the common law.
a. View of common law: The Erie Court rejected the idea that there was a “general” common law that applied with equal force in all common law jurisdictions. Instead, the court indicated that each sovereign state created its own common law.
b. Federal Courts and common law: The Court also held that the Federal Courts, unlike state courts, had no power to create common law. Therefore, RODA required the Federal Courts to follow the common law rules set out by the state courts.
If you have a particular rule of law, and the federal law conflicts with the state law, then you apply state law. Federal law applies only when a specific federal statute governs the matter or where a federal question is before the court.
Three Points The Court Made:
1. Swift erroneously interpreted the RODA;
2. Lack of uniformity resulting from Swift led to discrimination and forum shopping; and
3. Swift was unconstitutional because it authorize Federal Courts to make law in areas that even Congress was not permitted to make law
Congress has the power to create procedural rules. Erie was substantive law.
Procedure v. Substantive
Example: Negligence is substantive law. Negligence tells us if plaintiff has a cause of action. The procedure doesn’t address whether or not plaintiff has a cause of action. The procedural aspect of it governs the manner and means by which a right to recover is enforced.
Guaranty Trust Co. v. York
Supreme Court, 1945
1. Outcome determinative test
See page 72 of Legalines and page 88 of Emanuel
If the conflict between the federal and the state rule would result in a different outcome, then you have to file with state law.
Byrd v. Blue Ridge Rural Electric
Supreme Court, 1958
1. The balancing test
Byrd (P) was injured while connecting power lines. P was an employee of a subcontractor of Blue Ridge Electric Cooperative, Inc. (D). P sued D in federal court in South Carolina for negligence under diversity jurisdiction. P was a citizen of North Carolina and D was a South Carolina corporation. D defended on a South Carolina law that limited P's award to that of workers compensation and thus precluded a negligence action. There was a factual dispute as to whether P should be considered a statutory South Carolina employee for purposes of Workman's Compensation. Under South Carolina common law, such an issue was decided by the trial judge and federal procedural law required the issue to go to the jury.
The Court held that a Federal Court did not have to follow a state law that required a certain question to be decided by the judge. Instead, the Federal Court could follow the federal practice of having a jury decide the question.
a. Judge vs. Jury: The Court recognized that whether a judge or a jury decided the case could affect the outcome; however, it held that the likelihood of a different outcome was not great.
b. Federal Interest: Moreover, the Court noted a strong federal interest in using juries whenever possible, as evidenced by the Seventh Amendment. On the other hand, the state rule requiring a judge reflected no strong state interest, but was merely a historical practice. You don’t always have a right to a jury trial.
c. Holding: Comparing these interests, the Court held that the Federal Court could use a jury, even though the difference in laws was slightly outcome determinative. On this issue it was procedural because there was nothing in the workers compensation statute that suggested whether a judge or a jury was terribly important but the federal system favors juries.
d. Current relevance: The Byrd balancing test has never been disavowed. It continues to apply to judge-jury questions and is often invoked by the lower courts on other issues.
CONTINUING ERIE DOCTRINE
Hanna v. Plumer
Supreme Court, 1965
The defendant was the executor of an estate of someone who died in an automobile accident. The question presented was how the estate was served. Under the federal rules of civil procedure, one of the many ways you can serve an estate is to serve the personal representative. In this case the federal rule provides that you can leave service at the house with a person of suitable age and discretion. The state had a different rule. Which rule applies?
When a situation is covered by one of the federal rules, the appropriate test is twofold:
1. Whether the applicable rule is within the scope of the Rules Enabling Act (i.e., “relates to the practice and procedure of the district courts” or, in other words, whether it “really regulates procedure – the judicial process for enforcing the rights and duties recognized by substantive law and for justly administering remedy and redress for disregard or infraction of them”; and
2. Whether such rule transgresses constitutional bounds.
At the time the York decision (outcome-determinative test) was the law. Under York, this case would be dismissed and would be unable to re-file because the statute had run. The district judge applied the York test correctly but the Supreme Court decided to revisit this issue. The Supreme Court does not overrule York; however, they limit its application.
Up until now we’ve had common law. Now the difference is we have an act of Congress – The Rules Enabling Act, which authorizes the Supreme Court to actually promulgate the rule with the express authority of Congress. Congress has the power to regulate procedure.
The Enabling Act itself is constitutional and the constitution only gives power to the Congress to write procedures for the courts.
Rule 4(d)(1) is clearly within the scope of the Rules Enabling Act. Prescribing the manner in which a defendant is to be notified that a suit has been instituted against him, it relates to the practice and procedure of the district courts. Service of process is procedural – it doesn’t result in the extinguishment of a right.
See Emanuel pages 89-90
When dealing with a post Hanna case, and there is a conflict between federal law and state law, you have to first ask yourself: would the application of federal law versus state law affect the outcome of a case in a way that would encourage forum shopping?
If the application of federal law would not affect the outcome, then you simply apply federal law. If the application of federal law would affect the outcome in this way, then you have to do the balancing-test (Byrd case – state interest vs. federal interest).
If the federal interest is stronger than the state interests are, then you apply federal law.
The Constitution authorizes Congress to make procedural rules governing Federal Courts. Congress exercised and delegated this authority to the Supreme Court in the Rules Enabling Act. Pursuant to this authority the Supreme Court created and promulgated the Federal Rules of Civil Procedure.
If Congress makes promulgates an Act in accordance with the Constitution, it takes precedent over state law. You have to follow the rules of civil procedure when you are in Federal Court – you don’t have the option to follow the state rule. Therefore, FR 4 trumps the state rule for service of process.
Semtek Intl. Inc. v. Lockheed Martin Corp.
Supreme Court, 2001
P sued D in California and the action was removed to federal court under diversity. It was dismissed because of the running of the two-year statute of limitations in California. P then sued in Maryland because of a three-year statute of limitations. D moved for dismissal on res judicata. The action was eventually put in a Maryland State court that granted a dismissal based on the res judicata of the California federal diversity decision. The Supreme Court granted certiorari.
One of the things required by res judicata is that it has to be a decision based on the merits to prevent subsequent litigation.
Benson: Was the first decision based on the merits? What we’re trying to figure out is, does state law apply or does federal law apply? (We are still studying the Erie doctrine and not res judicata yet).
The Federal Court of appeals said federal law applies. Federal common law says that the claim is precluded.
Rule 41(b) Involuntary Dismissal: Effect Thereof.
For failure of the plaintiff to prosecute or to comply with these rules or any order of court, a defendant may move for dismissal of an action or of any claim against the defendant. Unless the court in its order for dismissal otherwise specifies, a dismissal under this subdivision and any dismissal not provided for in this rule, other than a dismissal for lack of jurisdiction, for improper venue, or for failure to join a party under Rule 19, operates as an adjudication upon the merits.
The defense is looking at Rule 41 and saying, not only is it an adjudication upon the merits, but the judge’s very order said that. And since we know that Rule 41 was promulgated with the Rules Enabling Act, federal law should apply right? Justice Scalia has a different view.
Scalia’s analysis: He gets around this language in Rule 41 by saying when they drafted this language they said “on the merits” but they didn’t really mean “on the merits” – for purposes of res judicata or claim preclusion. What they really meant to say was “with prejudice” and that means you can’t file it in the same court. Now everyone is in a different state with a different system altogether. Scalia doesn’t find any collision between Rule 41 and state claim preclusion laws. If you interpret Rule 41 as the defense was ask them to, that would go beyond the REA because that would affect a substantive right.
This is the sort of outcome-determinative test that exactly Erie was worried about (deciding between state and federal court). The invitation for forum shopping was too great in this particular case so they applied state law.
The Supreme Court held that the claim was not barred. The Court questioned whether Rule 41(b) might exceed the REA if it were to bar a substantive law claim. Instead, the Court held that the law in which the original Federal Court sat would be used to determine if plaintiff’s claim was barred.
Recap of the holding per Benson:
In any res judicata/claims preclusion situation, we are dealing with two lawsuits. By definition you are trying to decide whether the second lawsuit is “precluded.” In other words, is the second lawsuit going to be dismissed? In order to determine whether the first lawsuit – what is the “preclusive effect” of the first lawsuit, you apply the law of the forum of where the first lawsuit was filed – it’s usually the same forum, but this is a different case because they filed in a different state. When a Maryland court has to figure out whether res judicata applies, they have to determine what the California law is – not Maryland law for the first lawsuit.
1. Rule 41 did not apply because Justice Scalia and the majority said that the term “on the merits” in that rule really meant with prejudice (can’t re-file in the same court). Federal Common law says that it’s precluded. California said that it was not on the merits; therefore, it was not precluded. The state rule says not precluded, federal rule says precluded.
2. Is there a conflict? Here, there is because federal preclusion law would define the dismissal as “on the merits” for res judicata purposes while California law would not. Would the application of federal law affect the outcome of the case in such a way as to encourage forum shopping and discriminate against state residents? Yes, this is exactly was Erie was worried about. You have a federal judge in California, you have a state judge in California and they’re a half a block apart. You’ve got two very different rules that very much will affect the outcome of the case. One case is going to be dismissed forever and one will go to a jury. This would result in forum shopping and discrimination against in state residents.
3. Weighing the federal interests against the state interests, i.e. applying Byrd. The Court already applied York, now they are going to apply Byrd. The majority did not find any conflict with potential federal interest in the case. The majority did say parenthetically that this has to be done on a case by case basis. There might be times when dismissing a case in Federal Court where federal interest and res judicata might be strong enough to apply federal law – but not in this case. In other words, the federal government doesn’t really care; therefore, California law should apply. Under California law, this dismissal was not on the merits, therefore the plaintiff was free to continue its lawsuit in Maryland (this is not forum shopping – state law vs. federal law is forum shopping).
When might a dismissal of a federal case create a strong interest in the Federal Courts to give it preclusive affect? When a case is dismissed by way of sanction. You bring a suit in Federal Court, you repeatedly and consistently fail to follow the judges orders. If you file the case in another state, the judges might say no, this is a sanction; therefore, we are not going to allow it.
RES JUDICATA
The thing is decided
Hypo: I go to a ski resort and I fall and break my leg. I determine that the slopes were defective somehow and I sue them for negligence and I lose. Can I sue them again? No, I get one shot.
What if I find out that my broken leg has degenerated and needs to be amputated? Can I sue them again now? No.
What if I sue for negligence and I lose. I later determine that they breached the contract because I paid a consideration and they were supposed to provide me a reasonably safe slope? Can I sue for that? No, it clearly arose out of the same transaction or occurrence; therefore, I would’ve had to have added the claim in my negligence suit.
Courts like finality and efficiency – they like getting things resolved in one suit if at all possible. Because of the liberal Joinder rules, there is no reason to file multiple lawsuits. Res judicata is not liberal.
Claim Preclusion: If you could’ve brought a claim and failed to bring a claim, you may be barred from bringing the claim.
The General Rule for Claim Preclusion/Res Judicata:
A final judgment on the merits precludes the same parties (and those closely related to them) from litigating the same or a sufficiently similar claim in a subsequent lawsuit. It also forbids a party from litigating a claim that should have been raised in the former litigation but was not.
Federal Courts refer to this as claim preclusion
State Courts refer to this a res judicata
The General Rule for Issue Preclusion/Collateral Estoppel:
A final judgment not necessarily on the merits, precludes re-litigation of the same issue of fact or law, so long as (1) the issue was actually litigated, determined, and necessary to the judgment in the first action and it would not be unfair to invoke the doctrine. Unlike res judicata it does not require strict identity of the parties. The people who weren’t even involved in the first lawsuit can, and often do, rely on collateral estoppel to prevent the re-litigation of certain claims even though they were not even a party to the first suit.
Three Essential Claim Preclusion Elements:
1. The claim in the second suit must be the same as the claim in the first suit or a suit that could have been brought in the first suit but wasn’t;
2. The first and second suit must be between the same parties or parties in privity with one another; and
3. There must have been a final judgment on the merits in the first suit.
The Restatement (Second) on judgments:
(1) When a valid and final judgment rendered in an action extinguishes a plaintiff’s claim…, the claim extinguished includes all rights of the plaintiff to remedies against the defendant with respect to all or any part of the transaction*, or series of connected transactions, out of which the claim arose.
*This is referred to the Transaction Test. It is the most common among the states. Basically what it means is when all of the other requirements of res judicata are met, it bars any claims that arose from the same transaction or occurrence as the first claim.
This is somewhat similar to the compulsory counterclaim rule: if you fail to bring all of your claims, you have waived them and cannot bring them in a subsequent suit. You can’t keep bringing lawsuits for the decision you want.
Another test (used in California) is the Primary Rights Test. It is at the opposite end of the Transaction Test and it has a very narrow view. In other words, fewer claims would be barred under the Primary Rights Test. The courts look at: what is the primary right or what is being enforced here. Is it the right to enforce a contract or the right to be compensated for a personal injury or the right to be free from injury to your property? Under this narrow test, I could sue the ski resort for breach of contract because I am asserting a different right – my primary right in the first case was a tort claim, to be free from personal injury. In my second I’m trying to protect my right to enforce or seek damages from my contract. Most states have abandoned this view.
The Same Evidence Test falls in between. If the same evidence is needed to sustain both claims, then the claim would be barred. My breach of contract claim against the ski resort would be a close call but it would probably be barred.
Frier v. City of Vandalia
7th Circuit, 1985
Vandalia (D) police had a garage tow Frier's (P) car because he had been given two written warnings on the windshield but it was parked in such a way to block traffic. P did not receive a citation or a hearing either before the car was towed or after he refused to pay to retrieve it.
He files a lawsuit in district court seeking a writ of replevin (common law action to recover property from a party who wrongfully possesses it). He has to show that is right of possession is superior to that of the police. Frier looses.
He files a civil rights suit (42 U.S.C. Section 1983) in Federal Court because his due process (no hearing for the towed cars) rights were violated.
Issue: Was the section 1983 action the same cause of action as the replevin action?
Why does the federal government have to pay attention to the state decrees? The full faith and credit clause says that each state shall give full faith and credit to judicial decrees, statutes, etc. of every other state. Congress said that Federal Courts must give full faith and credit to any state court decree.
The district court judge has to look at the state decree and determine whether or not res judicata applies.
Because the claims shared a significant overlap in evidence, the new claims were barred under Illinois law, which uses the same cause of action approach (minority approach). Here the two suits were over the same acts but based on different legal theories.
Different states follow different rules.
Hypo: If Charles Frier had a wife and one of the vehicles was titled to the wife, is she then prohibited from bringing her separate action if Charlie brings his lawsuit and looses? Yes because there is no privity and she was not a party to the first action. It could be claim preclusion however.
Hypo 2: Instead of Frier suing the city, let’s say the city had sued him. His parking of the cars in the alley created a nuisance. He answers the claim, denies he’s done anything wrong, asserts a couple of affirmative defenses, litigates the case and he looses. Now Frier comes along later, files a separate action in Federal Court claiming a violation of his constitutional rights. Can he maintain that action? No, he had to raise it under Rule 13, compulsory counterclaim. Res judicata weaves in and out of other rules like a quilt.
Q: Is the Same Cause of Action Test in Frier the same as the Same Evidence Test?
A: Not really. This case presents a good example of why law students and lawyers alike must be very careful with labels. Apparently, in 1985, when the case was decided, Illinois, in applying claim preclusion, generally stated that the first suit precluded the second suit "where the parties and the cause of action are identical." Illinois also refers to the "same cause of action" test. But what do these terms, "same cause of action" and "identical" mean?
The majority said that by using these terms Illinois had actually adopted the broader so-called "transaction" test found in the Restatement (Second) of Judgments and followed by the federal courts. The minority opinion said no, when Illinois employs the term "identical," it is following the narrower "same evidence" test.
Obviously (by definition) the majority rules, so, according to the 7th Circuit, Illinois does not follow the "same evidence" test, but rather the broader "transaction" test.
Martino v. McDonald’s System, Inc.
7th Circuit, 1979, Cert. denied 1979
In 1962, Martino (P) entered into a franchise and lease agreement with McDonald's (D), which provided that neither P nor a member of his immediate family would acquire a financial interest in a competing self-service food business without the written consent of D. In 1968, P's son purchased a Burger Chef franchise in Pittsburg, Kansas. P financed the transaction. D sued for breach of contract, and P and D settled that dispute by entering into a consent agreement, which provided for the sale of P's franchise back to D. In 1975, P brought this action, alleging that the enforcement of the restriction on acquisition in the franchise and lease agreements violated Section 1 of the Sherman Act. The district court held that both res judicata and the compulsory counterclaim rule of the Federal Rules of Civil Procedure barred P from suing for antitrust violations. P appealed.
Rule 13(a) has been construed to provide that compulsory counterclaims are “lost of not raised at the proper time.” However, Rule 13(a)’s bar applies only when the defendant has entered a pleading as defined in Rule 7(a) (an answer). The problem in this case is that the defendants in the first lawsuit failed to enter a pleading; hence, their unasserted compulsory counterclaim is precluded by claim preclusion, not by Rule 13(a), and in deference to consistency.
If the rules do not require a defendant to bring a particular counterclaim in suit one, the party who was the defendant is free to bring the claim in suit two unless it falls within the narrow common law compulsory counterclaim rule. The common law rule asks whether the claim in the second case would have been a defense in the first case. If the claim would have been defense, it is barred. However, if the claim was a pure counterclaim, not a defense to the claim in the first case, the common law rule allows the party to bring it in the second case.
You can’t hold back a defense or a claim, settle the case on favorable terms and then sue on your defense.
Had they gone with a stipulation and order of dismissal instead of a consent judgment, would the result have been different legally? Yes. Would it make a difference in the real world? No because in the real world when you do a stip and order of dismissal, you also address these issues in your settlement agreement – it’s what you call a release. Releases tend to be broad and typically say that the parties agree to dismiss the case and the party hereby releases McDonald’s from any further liability know or unknown, etc.
Rush v. City of Maple Heights
OH, 1958
Rush (P) was injured in a fall from a motorcycle because of a negligently maintained street in the City of Maple Heights (D). P sued D in municipal court claiming that D was negligent in maintaining the street and this negligence was the proximate cause of her injuries. The municipal court awarded P $100 in personal property damages. D appealed and the judgment was affirmed. P then sued D in another court for personal injuries she suffered in the same accident. P claimed that the issue of negligence was res judicata from the judgment in the first action. P moved to set the trial for damages alone. This motion was granted. P was awarded $12,000. D appealed. The Court of Appeals affirmed.
The court held that claim preclusion prevented a plaintiff from bringing separate suits to recover for personal injury and proper damage stemming from the same accident.
Ohio moved from the primary rights test to the transaction test. When she filed the lawsuit, under the law in Ohio at that time, she had a valid second claim because she was asserting a different primary right – the right to be free from property damage and the right to be free from personal injury. She did win until the Ohio Supreme Court came along and she gets the rug pulled out from under her and changed the law.
Since plaintiff had but a single claim, the lower courts should have applied the doctrine of res judicata, which means the plaintiff’s second lawsuit should have been dismissed. Res judicata is when the 2nd lawsuit seeks re-litigation to the same claim litigated in the prior suit, and it bars such re-litigation. Collateral estoppel is when the 2nd suit addresses a different claim, and it precludes re-litigation of the issues decided in the 1st suit.
The minority rule was the wrong rule b/c it does not prevent multiplicity of suits, there are burdensome expenses, and vexatious litigation against D’s.
REVIEW
The Transactional Test is the broadest test which is what the Federal Courts follow. It is also the concept in the Restatement (Second) on judgments. There is a more restrictive test called the Primary Rights Test. It is an unusual test – the narrowest of them all and California still follows it. There is an intermediary test called the Same Evidence Test.
The Frier case was a 7th Circuit case meaning it was a Federal Court sitting in diversity attempting to apply Illinois law. The Illinois courts use very different language and that was the source of confusion. If you look at the case it says that Illinois follows claim preclusion as long as it is the “same claim” and it went on in another sentence and said the “identical claim.”
Different states use different languages. The way the majority interpreted that language is by looking at Illinois Supreme Court authority and decided that Illinois actually followed the broader Transactional Test – the court just never called it the Transaction Test in the state of Illinois. The minority opinion disagreed and said no, it has to be based upon the same evidence, which I would describe as the Same Evidence Test. There was obvious disagreement between the federal judges in that particular circuit as to what exactly the law of Illinois was. My point is that, unfortunately for all of us, the various states don’t always use language as we learn it in law school; the concept is important but don’t look at your first case in a panic because your state doesn’t use the same language as you learned in school but you do have to figure out what test your state is applying. The Federal Courts happen to be fairly uniform.
The Preclusion Doctrine
The basic idea is that it prevents people from relitigating cases that have already been decided by the courts. It is a common law doctrine and is case law developed over time. It has evolved over time from a very narrow concept to a much broader concept. You are far more likely today to be successful if you are the one asserting claim preclusion or issue preclusion than 50 years ago.
RES JUDICATA/CLAIM PRECLUSION
Three elements to prove Claim Preclusion:
1. The claim in the second suit must be the same as the claim in the first suit or one that could have been brought in the first suit but was not.
We have to determine: What is the same claim (Use one of the three tests). Under the Transaction Test a claim is deemed the same claim if it arises from the same transaction or occurrence as the claim brought in the original suit. When you file your second lawsuit if the second lawsuit arises from the same transaction or occurrence as the first lawsuit, you’ve met the first element which is the same claim. Under this test, if the plaintiff fails to bring a claim that the plaintiff could have brought or if a defendant fails to bring a counterclaim that the defendant could have, or even if the defendant failed to assert a defense, those can still be barred under the Transaction Test because they are claims or defenses they the defendant could have been brought, but were not.
The thing to remember is that res judicata is very harsh. They pleadings are so liberal – you can join any claim that you might have against a party; you can join other parties that might have a claim against you; you can amend the complaint if justice would require, etc. All of a sudden res judicata comes along and you have to read it in context of all these permissive joinders – you may join these claims. Lurking in the shadows is res judicata and if you don’t assert your claim you may be precluded (as long as you meet the other elements). It requires you as a plaintiff to claim everything you can think of that arises out of the same transaction or occurrence and it punishes you if you don’t. The same is true if you are the defendant; you have to assert all of your defenses in any counterclaim that you might have (it may be a compulsory counterclaim for Federal Court). Even in a state without a compulsory counterclaim, in a way they may be compulsory because of res judicata.
For exam purposes, be familiar with the Transaction Test – that’s what the Federal Courts follow. If the claim in the second suit arises from the same primary right of the first suit is considered the same claim.
Ski resort hypo: I sue the resort for personal injury and loose. I then turn around and sue them for breach of contract. Under the Transactional Test, that second claim will be viewed as arising out of the same transaction or occurrence as the first, and that would be considered the same claim.
In California under the Primary Rights Test, it would not be considered the same claim because the first right – the right to be free from personal injury – is different from the second right – the right to enforce contracts – so these are two separate rights.
The test that falls in the middle is the so called Same Evidence Test. This test treats the same claim as those claims that are substantially supported by the same evidence as claims brought in the first action.
What law do you apply? The general rule is: apply the law that was applicable in the first lawsuit.
Example: If the first lawsuit was filed in state court in California and the second lawsuit was filed in a different state, how do you know if res judicata or claim preclusion applies? You apply the California law to determine what preclusive affect that first lawsuit had. Look to the jurisdiction of the first lawsuit to determine what test they use.
If the first judgment was rendered by a state court, the rules of preclusion followed in that state apply even if the second suit if filed in Federal Court. There’s a statute that says that the Federal Courts have to give full faith and credit to state court judgments.
If the first judgment was rendered by a federal court sitting in diversity jurisdiction, the second court must apply the preclusive law of the state where the first court sits, unless the second suit is in Federal Court and the preclusion law of the first state is incompatible with important federal interest. That is nothing more than the Erie Doctrine modified over the years and ending with the Hanna case. Where there is a conflict, the courts are going to look at the controlling interest. The Federal Courts have a strong interest in applying federal preclusion, much more than a state court.
2. Claims Arising Out Of The Same Transaction But Not Considered To Be Part Of The Same Claim:
First Requirement for Res Judicata:
The first suit was brought in a jurisdiction that could not, for whatever reason, hear all of the claims.
Example: In Michigan the district courts shall handle all landlord/tenant disputes – they have exclusive jurisdiction over those disputes. If there is a related claim in excess of $25,000, the circuit court would have jurisdiction over that; therefore, while the landlord/tenant case is being heard in district court, you can’t bring the claim in excess of $25,000 between the parties – that has to be heard in a different court. When the landlord/tenant case is resolved, even though the $25,000 claim arose out of the same transaction or occurrence, there is no preclusive affect because the district court had no power to hear it in the first place.
Example 2: A Federal Court handling a federal question case declines (exercises its discretion) to accept jurisdiction over a state court claim under the supplemental jurisdiction statute. If the judge declines to do it, when the federal case gets decided on the merits, the related state case, even though it arose from the same transaction, is not precluded. Why? Because the parties had no ability to litigate it in Federal Court because the Federal Court declined to hear it; therefore, the aggrieved party is free to file that action in state court.
In other words:
Supplemental claims: If a plaintiff files a lawsuit in Federal Court claiming federal question jurisdiction and then asserts a state court claim over which the court would not normally have jurisdiction, the court can exercise (what we used to call pendent jurisdiction) supplemental jurisdiction. It is not mandatory; the court may use its discretion and not hear the supplemental claim. So even though the supplemental claim arose from the same transaction or occurrence as the federal claim, if the court refuses to hear it and then the federal case goes to a judgment on the merits, res judicata or claim preclusion is not going to prevent the plaintiff from bringing a separate action in state court. Why? Because the Federal Court would not hear the state claim but you have to attempt to bring it.
Example 3: If the second claim was not mature when the first claim was filed. As part of a business transaction there are two notes arising out of the same business transaction. One note is due and payable on February 15, 2007. The other note is not due and payable until February 15, 2008. You can’t sue on the second note because it’s not due yet – it’s not mature. Res judicata would not prevent you from bringing a second action on the second note because it was immature when you brought the first action.
Second Requirement for Res Judicata
The first suit and the second suit must be between the same parties (mutuality) or persons in privity with one another.
Mutuality: Both sides have to be bound or nobody is bound.
Privity: The party to the second lawsuit has the same legal interest as the party in the first suit and the second party’s legal rights relative to that interest were litigated in the former suit. People in privity relationships are considered to have interests so closely entwined that a decision involving one such person necessarily controls the interest of the second person.
Searle Brothers v. Searle
UT, 1978
Edlean Searle (D) sued Woodey Searle for divorce. The divorce court determined that a piece of property known as the "Slaugh House," which was recorded in Woodey's name, was part of the marital property. Woodey had argued that he had a half interest in the property and that the other half was owned by a partnership with his sons as partners. The court rejected that claim and awarded the entire property to his wife the defendant. Searle Brothers (P), the partnership, then sued D, to protect their interest claiming an undivided one-half interest in Slaugh House. The trial court held that res judicata and collateral estoppel barred the action by P. The plaintiff’s appealed.
For res judicata to apply, both suits must involve the same parties or their privities and also the same cause of action. Collateral estoppel arises from a different cause of action and prevents parties or their privies from relitigating facts and issues in the second suit that were fully litigated in the first suit.
Privity relates to one whose interest has been legally represented at the time. This includes a mutual or successive relationship to rights in property. In the present case, Ps' interest is neither mutual nor successive. Ps claim no part of the interest owned by Woodey Searle, but assert their own independent and separate partnership interest. The property interest arose before the commencement of the first action, not subsequent thereto, so that Ps cannot be regarded as in privity and subject to the judgment rendered therein. Also, under law, partners are co-owners of specific partnership property, which is directly opposite to successive interests. Finally, lf it could be said that Woodey Searle is Ps' agent, the rule is that agents and principals do not have any mutual or successive relationship to rights in property.
Dissent: Because Ps were sufficiently involved and interested in the divorce proceeding, they should, on the basis of equity, be regarded as parties in privity with Woodey Searle.
The Three Most Common Examples of Privity:
1. The relationship between owners of property and the relationship between owners and successive interest in property or real property.
Example: If a cottage owner is involved in litigation settling a zoning issue and I buy the cottage, I am in privity with the person I bought the cottage from – I might be bound by the results of the litigation because we have an interest in the exact same property.
2. The second most common is the representative relationships, i.e. the trust or trustee and the beneficiaries of life insurance.
3. Virtual?
Just being a family member does not create privity. Being married does not create privity. You are not in privity with your siblings. We are looking at separate people sharing a common legal interest in something.
Third Requirement for Res Judicata:
There must be a valid final judgment on the merits on the first suit.
If those three requirements are met, then the parties are precluded from relitigating the same case.
ISSUE PRECLUSION/COLLATERAL ESTOPPEL
Narrower but deeper than res judicata. It is also grounded in the same principals of judicial economy, respect for finality, avoiding inconsistent judgments thus maintaining the integrity of the system. It makes no sense to re-litigate the same question over and over again – do it once, right the first time. Collateral estoppel prohibits the same parties or sometimes other parties from re-litigating the same facts.
Example: If the second claim is a different lawsuit and not barred by res judicata because it is a different lawsuit, so long as the same facts or legal issues were decided in the first claim, then that particular issue will not be re-litigated.
The Restatement on the elements of Collateral Estoppel – What we have to establish in order to determine whether or not issue preclusion applies to a particular case:
1. When an issue of fact or law is identical in both suits;
2. The issue was fully litigated and decided in the first action;
3. The issue was determined by valid and final judgment; and
4. The determination of the issue was necessary to the judgment in the first action.
See the next page for more detail of the elements
A valid and final judgment has the same meaning as in res judicata. Most courts will find that a judgment is valid and final even if it is on appeal pending or otherwise.
The judgment doesn’t necessarily have to be on the merits.
Example: A Federal Court dismisses a case for lack of personal jurisdiction and the plaintiff brings a second suit in the same state that the first suit was brought in. Even though there was no judgment on the merits (the case was dismissed), it’s still collateral estoppel because the state court is going to say that there was no personal jurisdiction over the defendant and make the same finding.
*Don’t confuse a valid and final judgment with a decision on the merits. The distinction is: both res judicata and collateral estoppel have to have valid and final judgments but under issue preclusion it does not have to be on the merits.
*The subsequent action does not necessarily have to be between the same parties or persons in privity with those parties. It goes against the idea that one should not be bound by a judgment that one did not participate in but under issue preclusion/collateral estoppel sometimes you can.
That is the biggest difference between res judicata and collateral estoppel.
Mutual Collateral Estoppel: When the second action is between the same party(s).
Non-mutual Collateral Estoppel: A party to the second action, who was a stranger to the first action, can still be bound. It has limits because it presents questions of fairness.
The Elements in Detail
1. The issue of fact or law must be identical. As a litigant you must determine the scope of the issues precluded. Unlike res judicata which says the claim that you brought or could have brought, collateral estoppel only applies to those claims that were brought. When arguing issue preclusion you cannot stand in court and say, your honor he could have brought this issue but failed to. That works with res judicata but does not work with collateral estoppel. Basically are you arguing the same facts that were decided and resolved in the first suit? People try and re-word complaints to make it sound very different. You’ve got to look beyond what was pled in the first suit and look at the facts, then look at the second complaint. If they are trying to win on the exact same factual disputes as in the first suit, it’s the same claim.
In addition to the same facts, the same legal standards have to apply to both actions and the burden of proof must be the same.
Two Types of Burden of Proof
1. The burden of moving forward with the evidence and production; and
2. The degree of persuasion that is necessary;
a) Preponderance of the evidence (civil burden)
b) Beyond a reasonable doubt (criminal burden) Policy: we are less tolerant of mistakes when someone’s life and liberty is at stake as opposed to money damages
c) Clear and convincing evidence (used in parental rights cases)
Notes, page 687
1. No, the burden of proof is higher (like the O.J. case)
2. No, The burden of proof is lower – the government has a higher burden and people are entitled to a jury trial anyway.
3. Yes, the burden of proof in the first case (criminal) was higher.
For preclusion to apply you have to have the same claim, same legal standard, and same burden of proof.
Lumpkin case
The mayor of San Francisco appointed Lumpkin to the human rights commission. In an interview, Lumpkin said that homosexuality is a sin. The San Francisco board of commissioners insisted that Lumpkin be fired. A later reporter got Lumpkin to admit that he believes everything in the Bible and the Bible says essentially that a man who knows a man must be killed. Caving to political pressure, the mayor fires Lumpkin because the mayor took that to mean an indirect threat of violence.
Lumpkin filed civil rights suit in Federal Court in violation of 42 U.S.C. 1983. A judge dismissed the case. He filed a separate suit in state court under the California civil rights statute. San Francisco filed a motion to dismiss based upon issue preclusion.
Why would the city file under issue preclusion and not under res judicata? The judge only decided the federal question; therefore, the state case was never heard. Res judicata was not available to the city. Lumpkin argued two things:
1. The CA civil rights statute was never designed to be argued in tandem with federal civil rights, protecting a state right; and
2. The federal judge was wrong.
The court’s argument:
1. The court said that the federal judge resolved all the issues. This case had the same claim, the same legal standard and the same burden of proof – issue preclusion could apply; and
2. If the judge was wrong, then appeal.
The second judge never substituted his judgment for the first judge.
From attorney malpractice hypo: Before you can tell whether there is preclusion, you have to figure out what the standard is for a Sixth Amendment violation (ineffective counsel) and how does it compare to the common law tort of legal malpractice. My point is: you have to know what questions to ask; (1) If the standards are the same, you can use issue preclusion; and (2) were they are party or not.
Illinois Central Gulf Railroad v. Parks
IN, 1979
Parks (P) and his wife were injured when their car collided with an Illinois Central (D) train. P's sued and the wife recovered $30,000 on her claim for damages. The judgment was rendered for D on P's own claim for damages for loss of services and loss of consortium of his wife. P then sued D to recover damages for his own injuries. The trial court held that P's claim was not barred by res judicata, and that the prior action did not collaterally estopp P on the issue of contributory negligence. The trial court held that it was not possible to determine if P lost because he was contributorily negligent or because he could not prove his damages. D appealed.
The husband’s claim is derivative: his wife has to win in order for him to win.
The husband suffered personal injuries as well and he brings another lawsuit. Why wouldn’t the railroad prevail on res judicata? He was a party after all.
Indiana in 1975 didn’t follow the Transaction Test.
The court reasoned (from Emanuel page 255) that plaintiff could have lost either because he was contributorily negligent or because he suffered no damages. Although the contributory negligence issue was the same in both suits, damages would differ for the different claims.
Most verdicts are simply general verdicts – you have no idea what the jury based its decision on. Or you can ask for a special verdict – asking the jurors to give findings on each submitted issue under Rule 49, Special Verdicts and Interrogatories.
To avoid this problem, the railroad could have asked the jurors to answer each question separately to try and flush out how contributorily negligent the husband really was. It keeps jurors from feeling too sorry for a plaintiff.
Benson: The upshot of the case: If a judgment could have based upon a determination of two or more matters of fact or law, (he could of suffered damages or that he was contributorily negligent) and the party in the second suit what wants to invoke collateral estoppel based upon one of those matters, the party must prove that the jury actually rendered judgment on the determination of those set of facts as opposed to the determination of another matter.
Under a general verdict form that is virtually impossible (page 689).
Collateral estoppel must be based on factual matters that are actually litigated, decided, and necessary. If the person invoking collateral estoppel cannot show that it was actually decided, then issue preclusion does not apply – they will lose that motion.
To determine whether an issue was necessary to support a judgment, ask yourself: if the issue was decided the opposite way, would the same judgment have been entered? If the answer is yes, then it wasn’t necessary – the judgment did not depend on those issues.
Car accident example: P sues D claiming D was negligent. D defends on contributory negligence (total bar of claim). The jury comes back and says D was negligent but also finds P contributorily negligent. Assume this state has no compulsory counterclaim rule. Now D in old suit sues P in the new suit. The D says, issue preclusion – the jury found that you were negligent; therefore as a matter of law, you had to have been contributorily negligent. Is the P (former D) going to lose because the jury found that he was contributorily negligent? No because the finding that the original D was negligent was not necessary to the judgment because the plaintiff was found contributorily negligent – standing alone, that results in a no cause. The P would have lost regardless.
This is one of the reasons courts compel people to bring their counterclaims.
MUTUALITY
Non-mutuality: A concept that says sometimes someone who was not part of the first lawsuit can be bound.
What protections are in place to make non-mutual collateral fair to those parties?
Hypo: Sue one neighbor for nuisance (kids bouncing balls all day) and I loose. I sue another neighbor and loose that case. I sue another neighbor and loose. At what point does the court tell me to give it up? That’s what collateral estoppel is all about.
Part 2: If I sue one neighbor on the issue of kids bouncing balls all day, and I loose that issue. I then sue a second neighbor, who is a stranger to the lawsuit, but can the second assert collateral estoppel against me? The court will ask why it should try the same lawsuit every time. It is not unfair to hold me to that earlier adjudication.
*Part 3: What if I sue the first neighbor and I win? Then I sue my second neighbor. Is it fair to bind the second neighbor? No, using offensive non-mutual collateral estoppel is not fair. The doctrine is supposed to limit the amount of litigation.
Patent infringement hypo: Company P sues Company D for patent infringement and the first court said that P’s patent was invalid and lost. They then sue someone else alleging they were infringing on their patent. The other person argued that your patent is not valid as determined by the first court. The United States Supreme Court said it is not unfair to bind a second judgment based on the first one. Company P would continue to loose based upon an invalid patent.
The Wait-and-see Attitude
Parklane Hoisery Co. v. Shore
Supreme Court, 1979
Ripped-off shareholders file a civil action against Parklane. In a second civil suit the SEC sued Parklane (D) for issuing a materially false and misleading proxy statement of a dummy corporation used to inflate the stock price. The SEC’s case went to trial first. Both the shareholders and the SEC have to show the same thing to win but what the shareholders have to show that the SEC doesn’t is damages.
The shareholders try to use offensive non-mutual collateral after the SEC wins. It was already determined and the shareholders wanted a partial summary judgment – they want to try the case on damages alone.
The Supreme Court went from a bright-line rule (offensive non-mutual is never allowable) to replacing it with the discretion of the trial court with specific instructions to scrutinize very, very carefully to insure that it is fair to the defendant against whom it is being asserted (the party in the first litigation).
Offensive non-mutual use has proven more problematic, and accordingly its use is subject to greater limitations. The Supreme Court expects district court judges to explore and find other judgments and then look to see if they are inconsistent.
The Supreme Court’s decision discusses the problems with offensive use. The two main problems are:
1. Wait-and-see. In this case there was no real wait-and-see, the shareholders sued first and it wasn’t in their control to join in the SEC’s suit anyway.
2. Efficiency concerns. Non-mutual offensive presents the risk of inconsistent judgments. Different courts could reach different conclusions concerning the same basic issue.
Benson: The offensive use of non-mutual collateral estoppel must be regarded and treated differently from the defensive use. The defensive use is going to be more often successfully invoked because it’s usually fair. The offensive use is going to be scrutinized a lot closer but it’s allowable.
State Farm Fire & Casualty Co. v. Century Home Components
OR, 1976
A fire started in a shed owned by D. It spread to other properties in the area. Eventually over 50 separate actions for damages were filed against D to recover losses from a fire. Three of the actions proceeded separately through trial to final judgment; a judgment was awarded in favor of D, and the other two judgments went to the claimants. State Farm (P) stored some of its property in a warehouse just sixty feet from D's shed and the fire destroyed P's property. P, and other parties, who was not a party to any of the previous actions, sought to utilize the prior claimants' judgments to establish D's negligence and its responsibility for any losses caused by the fire. Ps all filed amended complaints to match the cases in which D was found to be negligent. D, of course, asserted that it had a favorable ruling in one of the cases. The trial court held that D was collaterally estopped from any further contesting its liability.
ISSUE: When prior judicial determinations on a particular matter are inconsistent, does the doctrine of collateral estoppel bar re-litigation of that matter?
No. In every situation where collateral estoppel is asserted by a person who was neither a party nor in privity with a party to the prior case, it is essential to determine that no unfairness will result to the prior litigant if the estoppel is applied. Also, we are not free to disregard incongruous results.
Emanuel:
The court refused to allow offensive use given the inconsistent results in prior cases against the defendant.
It is important to remember that the relaxation of the mutuality requirement applies only against people who were parties in both actions. It is a violation of due process to use claim or issue preclusion against someone who was not a party in the first place. The due process clause entitles people to their day in court.
LAW OF THE CASE
Law of the Case: There is a case at the trial court level and the case gets either appealed to the court of appeals or the Supreme Court. The case then gets remanded to the trial court for further proceedings. The decision of the appellate court becomes “the law of the case.” The parties are not permitted to re-argue whatever issue the court has finally resolved. It’s a little bit like claim preclusion and collateral estoppel – you’re not allowed to re-argue the issue.
It is a common law doctrine and it is fairly aggressively followed but not absolute. Appellate courts do not like it when people argue issues that were already resolved in trial court. Once the court of appeals has resolved an issue and sends it back to the trial court, the trial judge may not revisit the issue even if the court of appeals is wrong.
JUDICIAL ESTOPPEL
Judicial Estoppel: it is also a common law concept. It varies from state to state and some states do not even recognize the doctrine. If a party takes a position of fact in one lawsuit and the court acts on that position, if that party obtains a favorable decision based upon this representation of fact, he may not take in a subsequent proceeding a contrary position – he is judicially estopped.
In the modern rules of pleading you can take alternative positions in one lawsuit – you can plead both factual and legal in the alternative but you can’t try your case in the alternative – at some point you have to take one position.
Example: I own the dog but the dog was provoked and you win the lawsuit. In a subsequent lawsuit you deny ever owning a dog. Now you are running into a problem. You’ve gone on the record, under oath and you’ve taken a factual position and you won that case. Now in subsequent litigation you’re taking a factual position that is contrary to the first position.
Most states, including the federal government will prevent you from doing that – it’s judicial estoppel. The two most common elements are:
1. The factual positions must be opposite from one another There must be direct contradiction between the two positions
2. The first case had to end favorably for the person taking the position.
Example: Suit against an insurance agent and insurance company (Allstate). In another county (Wayne) Allstate was arguing the opposite factual position. The brief was shown to the judge but he said the Wayne county judge was wrong – he is right but the other judge was wrong and Benson lost.
Tip: When dealing with national corporations, check out their litigation in other venues.
A small minority of the states do not require that the first action end favorably. Judicial estoppel is generally confined to the facts. A corporation may take other legal positions – it makes them look bad, but it may not necessarily be judicial estoppel. It’s when they take positions of fact.
DISCOVERY
Discovery is a common law concept borrowing from the court of equity. American discovery rules are extremely liberal. Federal Courts have tried to limit discovery because it can be abused.
Informal Discovery
Under Rule 11 you are required to do an investigation before you file your complaint. So what do you do? Call witnesses, call opposing counsel, get police reports, get ambulance reports, freedom of information reports, etc.
Formal Discovery
Doesn’t kick in until the complaint is filed. The days of trial combat are over. No matter how honest your client is, there is a large body of information that your client doesn’t know.
Reasons for Discovery
Discovery very often leads to settlement. Most attorneys know who is going to win and who is going to lose. It narrows the issues through the pleadings. Discovery has the ability to flush out where the parties disagree and where they don’t disagree. You learn about your opponent’s case, you’re avoiding surprise, and you’re posturing your case for settlement and you’re also posturing your case for a possible motion for summary judgment.
The Downside
Another aspect for discovery is the illicit purpose of driving your opponent into bankruptcy. Example: Loss of consortium claim. Opposing counsel will abuse discovery to humiliate your client. If you allege it, the defense has the right to explore it. There’s an ugly side to discovery so don’t ever do anything thoughtlessly and just throw it into a complaint.
Length of Discovery
How long discovery lasts varies from court to court. In a small case 3 months. Typically it’s 8 months to 1 year in a large case. The scheduling order will set forth deadlines, discovery being one of them. Please meet those deadlines. Usually upon motion a court will extend
Scope of Discovery
26(b) Discovery Scope and Limits.
Unless otherwise limited by order of the court in accordance with these rules, the scope of discovery is as follows:
(1) In General.
Parties may obtain discovery regarding any matter, not privileged, that is relevant to the claim or defense of any party, including the existence, description, nature, custody, condition, and location of any books, documents, or other tangible things and the identity and location of persons having knowledge of any discoverable matter. For good cause, the court may order discovery of any matter relevant to the subject matter involved in the action. Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence. All discovery is subject to the limitations imposed by Rule 26(b)(2)(i), (ii), and (iii).
(2) Limitations.
*Benson: The limitation is relevance. Relevance is an evidentiary concept meaning any item or information that makes the fact of consequence in the trial either more likely to exist or less likely to exist relevant. It is any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable. It is a very low burden and is very broad. At some point you get an idea of what is relevant and what is irrelevant. Is this information likely to show the existence or nonexistence of something?
In discussing the scope of discovery, in order to know if something is relevant you have to know what the theory of liability is, you have to know what the defense is. If you don’t know what the theory of liability is or what the defenses are, you will never know whether something is relevant. That’s what makes discovery challenging to law students because not only do you have to know the scope, but also you have to remember what the elements of negligence are, the elements of breach of contract, etc. In civil procedure, you go into a deposition and you are not always 100% sure what your own theory is much less your opponent’s theory, but you’ve got to understand the basic theory of your case before you can understand the scope of discovery. You have to understand the substantive law.
Tip: For depositions, pull out your jury instructions to find out what you have to prove.
In discovery it doesn’t matter if it’s admissible or not. Hearsay is a valid objection at trial but not in discovery.
The most common objections to discovery requests:
1. The information sought is irrelevant
2. The information sought is privileged
3. The information sought is overly burdensome It might be marginally relevant that the amount of time, cost, and energy that will go into producing this information is too burdensome.
Davis v. Precoat Metals
ND, 2002
Davis (Ps) are African-American and Latino employees who worked at Precoat's (D) Chicago plant. They allege they have been exposed to a hostile work environment. They allege they are subjected to racially insulting and derogatory remarks by D's management level employees. Ps also allege that D has discriminated against them in terms of entry level placement, work assignments, promotions, and discipline and that D retaliated against them for complaining about those practices. Ps noticed D for discovery over a narrow period of time related to all racial discriminatory complaints at the plant where Ps worked. D refused to answer and P had to motion to compel.
This is a fairly common request and a fairly common objection. The plaintiffs were asking for discrimination complaints made against the defendant from 1998 to 2002.
If you were defending this case, and you get this discovery request, what would your objection be? Ask yourself, what do these people have to prove and is any of this information going to make any “fact of consequence” any more or less likely to exist? One of the things they have to show is actual discrimination against them – not that the company is a bad company.
If you ask for complaints from the last 10 years, that doesn’t go to show that the company mistreated you. Even if you found some statistical evidence, it doesn’t go to whether or not the company mistreated you personally. Are patterns of past misconduct considered evidence? Can that be used to draw an inference? The court says yes, the plaintiffs are correct that other employee’s complaints of discrimination may be relevant to establish pretext (an excuse for what is really going on). Patterns can be used – it doesn’t conclusively prove anything but patterns can be used to draw an inference of actual discrimination on a particular occasion.
The plaintiff’s lawyers were smart; they limited the scope, they weren’t asking for everything.
All of these arguments are tied directly to the theory of the case and the theory of the defense. The plaintiffs would never have gotten out of the gate unless they cited McDonnell v. Green (1973) – evidence of a pattern can be used to draw an inference as to racial discrimination on a particular occasion. You have to argue the theory of the liability. You have to know the law. When in doubt the courts will always allow you to get the information.
Discoverable information is not defined by what is admissible at trial. Discoverable information is relevant if it appears reasonably calculated to lead to the discovery of admissible evidence. This does not give any plaintiff a carte blanche as a court can limit discovery if it determines that the discovery is unreasonably cumulative or duplicative, obtainable from other sources that are more convenient, less burdensome, or less expensive, or the burden or expense of the proposed discovery outweighs its likely benefit. Rule 26(b)(2).
Rule 26 gives judges extraordinary discretion and can even prevent parties from even getting relevant information – the party must make the case.
Steffan v. Cheney
DC, 1990
NATURE OF THE CASE: This was an appeal from the dismissal of an action for wrongful (constructive) discharge from the U.S. Naval Academy. The action was dismissed for a failure to comply with a discovery order.
FACTS: Steffan (P) was involved in an administrative action for his dismissal from the Naval Academy because of his admission that he was homosexual. He was not discharged for any homosexual conduct. On a hearing for reinstatement, P claimed his Fifth Amendment privilege against self-incrimination and refused to answer a deposition question on whether he engaged in homosexual conduct during or after his tenure as a midshipman.
P also objected in that the questions were not relevant to the legality of his separation. The court held that the questions were relevant because the Navy could refuse reinstatement on the grounds an individual has engaged in homosexual acts. The district court dismissed his case for failure to comply with its discovery order. P appealed.
This all goes back to understanding the theory of the case. These are legitimate questions. If the plaintiff admits under oath that he has engaged in homosexual activities, that is a violation of the rules and regulations and the Navy doesn’t have to re-instate him back into the Navy. This comes out because of the substantive law he was arguing. I was fired by not what I had done, but who I am.
When faced with the question at a deposition, he refused to answer the question. The question was relevant. He claims privilege and privilege is only an issue if it’s relevant. He invokes the Fifth Amendment and he wins on appeal. The court says that it is not relevant
Wrongful termination example due to race or gender discrimination: The defendant asks you, while you were working for us did you get an email from your husband asking you to pick up the kids? You answer yes. They file an amended answer stating, we have a strict policy of no personal emails at work. Now that we have evidence of your misconduct while at work independent of your race or gender that would have resulted in your discharge, you have no damages because we can fire you for taking that email from your husband. Benson: That is valid and it is upheld everyday.
What is the difference between the example and this case? The difference is the law. You’ve got to know the law. Steffan was dismissed by an administrative board and the rules are different from private companies.
So what is the law? The law says that an administrative board has all sorts of discretion but judicial review is limited. They can only review the reasons stated by the board for the dismissal and in this case he was dismissed because he declared himself a homosexual period. Whether he engaged in homosexual activities is irrelevant because under the law of this case it is irrelevant.
This is an unusual case because the judicial review is so extraordinarily narrow. It’s usually not that narrow but it is in this particular case.
PRIVILEGE
Privilege generally means that certain types of communications are not discoverable nor are they admissible. There are many different types of privilege, i.e. attorney-client, doctor-patient, priest-penitent, trade secrets, etc.
Attorney-Client Privilege: The oldest common law privilege. It is designed to allow a represented party to be able to speak fully and frankly without fear that what is said to an attorney will be used against them.
In a criminal case it has a constitutional dimension (Sixth Amendment), people have a right to effective counsel and it cannot be effective unless there is a privilege.
Do not mistake the concept of privilege with the model rules of professional responsibility that says that you have to keep your client’s secrets. Privilege is very narrow; it only protects certain communications between the attorney and the client. Ethically you have to keep your client’s secrets. The privilege only attaches to the communications. Not just any communication but those communications which both the client and the attorney reasonably and objectively meant to be privileged or confidential. It is your responsibility that the client understands that these communications are intended to be confidential – making an effort to keep the communication confidential when around third parties.
A reasonable person must recognize that this communication is intended to be confidential. The client owns the privilege which means the client can waive it. The lawyer can invoke the privilege for the client.
Depositions. In a deposition there are very few valid objections because the court will decide if something is admissible or not. Privilege is a different matter. If you allow your client to answer a privileged question, you have waived it forever. You cannot invoke the privilege, refuse to answer the question and then later try to introduce that communication in trial.
If you claim compensation for injuries, your past and present medical records are discoverable. With certain types of lawsuits, you waive certain types of privileges.
Privilege only protects the communication and not facts (running a red light for example) that may be in the communication.
Exception to the Attorney-Client Privilege: The Crime/Fraud Exception. Anytime a client is communicating with a lawyer for the purpose of committing a crime, that communication is not privileged.
During the course of discovery, the attorney inadvertently discloses confidential communications. The majority of the courts will allow a one-time inadvertent disclosure – it is not a waiver. If it is routine, the courts can find for a reckless waiver.
Spousal privilege. Two forms:
1. Testimonial privilege. If a man and a woman are married, one spouse cannot be compelled to testify against another spouse.
2. Spousal privilege. After a man and a woman have divorced, if there is a communication made during the marriage that both parties understood was confidential, the testifying spouse cannot disclose any communication that was meant to be confidential between husband and wife while they were married.
The old common law rule was that non-testifying spouse could invoke the privilege. The rule was changed so that the testifying spouse could invoke the privilege.
Fifth Amendment
No person shall be compelled to be a witness against himself. A prosecutor cannot call a criminal defendant to the stand unless the defendant has been called to the stand by his or her attorney. No may a prosecuting attorney mention or comment to the jury of the defendant’s refusal to take the stand.
Fifth Amendment in a civil lawsuit general rule: The US Supreme Court says you may invoke it after all it is the government enforcing all of these rules; however, since the states are lower and it would be a private party using the Fifth Amendment to try and gain an advantage over another private party, the lawyers can comment to the jury that this person refuses to testify or that this person must be hiding something. “If he’s so innocent, why doesn’t he take the stand?” But you run the risk of a default judgment. You invoke it at your own peril in a civil suit.
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Butler v. Rigby
US District Court, LA, 1998
FACTS: There was an auto accident. Butler (P) and other plaintiffs got medical treatment from American Medical Group (AMG) and Midtown Health Center (MHC). These groups were doctors who provided medical treatment to all of the plaintiffs. D filed a notice of deposition and requested certain documents regarding the nature of the relationship between the doctors and the attorneys representing Ps. Rigby (D) wanted documents that listed the total number of patients treated by the doctors since 1992 that were involved in the present lawsuit and a list of patients referred to the doctors by specific personal injury lawyers.
AMG and MHC moved for a protective order prohibiting D from discovering that information based on the grounds that the relationship between the doctors and the lawyers were not relevant to the suit, that some of the information was protected by the doctor patient privilege and that the request was overly burdensome
D argued that the information was relevant because it would show that the doctors had received money from lawyers who had represented P. The magistrate ruled that most of the information was discoverable. AMG and MHC objected and asked for a ruling from the district court. Rule 26(c) protects nonparties to a lawsuit from discovery and allows those nonparties to move for a protective order. Rule 26(b)(1) sets the scope of discovery as any matter not privileged which is relevant to the subject matter of the pending action. Rule 26(b)(2) protects parties against unduly burdensome discovery.
The defense wants some information from a non-party. Rule 45 gives all attorneys the power to send subpoenas to people. The defense wanted the identity of the patients treated by the doctors since 1992 that were involved in the present lawsuit and a list of patients referred to the doctors by specific personal injury lawyers. They want to know how closely these doctors work with these particular attorneys. Is that relevant?
Relevant Issues:
The credibility of a witness – the believability of a witness is always relevant in any adversarial proceeding. With that in mind, the defense wants to know how many cases had been referred to the doctors by the plaintiff. The witness’s credibility is always at issue and what bias means is, does the witness have a relationship with one of the parties such that the witness had a motive to color his or her testimony in favor of that party. 80% of the doctor’s income came from these attorneys. If my income depends upon this lawyer, I’m not going to say his client is just fine very often. He has a motive to over exaggerate the injuries and is relevant to his credibility.
It doesn’t mean that the doctor is a liar or is in cahoots with the lawyer but there is an inference that they might be. It’s relevant and they permit it. It may not be permissible down the road but it is discoverable. If it’s irrelevant, you don’t have to talk about privilege because it’s neither discoverable nor admissible. Privilege is only a problem when something is relevant and privilege can keep out relevant facts: “Did you kill your wife?” – Fifth Amendment privilege.
The names are privileged because there is a statute that says it is privileged. The names of the patients were not relevant except for discovering other possible witnesses, therefore relevant because the other lawyer wants to call them but due to HIPPA laws you’re not going to get the names nowadays.
VEHICLES OF DISCOVERY
1. Required disclosures, Rule 26(a)
2. Depositions, Rule 30
3. Written interrogatories, Rule 33
4. Request for production of documents and things, Rule 34
5. Mental and physical examinations, Rule 35
6. Request of admissions, Rule 36
Required Disclosures Rule 26(a)
It requires that the parties disclose certain information to each other automatically. There is certain information that must be disclosed. The initial disclosures must be made within 14 days of the 26(f) conference. Benson: Need to know – Required Disclosures under Rule 26:
Level 1 (a)(1) Initial Disclosures:
• Names, phone and addresses of supporting witnesses (likely to have discoverable information).
• Copy or description of supporting documents
• A computation of damages (Plaintiffs)
• Any insurance agreement (Defendants)
Level 2 (a)(2) Expert Disclosures:
• Identity of experts
• An expert report including:
• Signature
• Complete opinions
• Reasons and basis
• Data considered
• Exhibits to be used
• Qualifications (including publications for 10 years)
Level 3 (a)(3) Pretrial Disclosures:
A. Name (and address/phone if not previously disclosed) of
“Will call” witnesses
“May call” witnesses
B. Designation of testimony of non-live witnesses
C. Identification of all exhibits
Rule 26(f): Starting the process of civil litigation
The parties must as soon as practical and in any event at least 21 days before the scheduling conference found in Rule 16(b). The 26(f) conference is a conference you must conduct with the attorneys or non-represented parties outside the presence of the court. In other words, this is a meeting you prepare for the conference you have with the court and it must be done no later than 21 days before the pre-trial conference which is found in Rule 16. Rule 26(f). Basically the court forces parties to come up with some sort of a plan for litigation – if everyone can agree it makes the court’s job much easier. You then have to make the initial disclosures in 26(a)(1) within 14 days of that meeting.
New Change for 26(f):
Rule 26(f) adds E-discovery issues to the topics to be addressed in the Rule 16 Conference Report
You may not make a formal demand for discovery before the 26(f) conference. This is a private conference without the presence of the court.
You discuss the nature of the claims and the defenses
You explore the possibility of settlement
You make arrangements for the initial disclosure; in other words, you discuss how and when that is going to happen and must be done within 14 days
You discuss what needs to be disclosed
You argue what the law requires of you.
You then develop a proposed discovery plan:
1. Should you make any changes to the disclosure rule? You can decide your own disclosure plan within reason.
2. Discuss how long you want it to remain open. What limits if any. You can decide the number of depositions.
For the most part, courts will honor and enforce any reasonable stipulation you come up with.
Rule 26(a) breakdown of terms
Impeachment: Any evidence that tends to diminish a person’s credibility. Any evidence that can be used to draw into question the believability of a witness is considered impeachment. If you have a witness for impeachment purposes only, you don’t have to disclose that witness in the initial disclosure (but you may be required to later).
Documents: Parties are required to provide a copy of or description of category of all documents he may use to support his claim or defense.
Damage Computation: Must do a computation of any category of damages claimed and all non-privileged documents supporting that computation.
Evidence of Insurance: If you are a plaintiff, you want to know if defendant is covered by insurance.
Expert Witness: 26(a) also requires disclosure involving expert witnesses and expert reports. Each party must disclose the identifying of its testifying experts. It is common to hire experts that assist in the litigation and you do not have to disclose the non-testifying experts, it’s part of work product and strategy. The scheduling order will always require you to disclose your experts.
Lay witness: A person that can only testify as to that person’s personal knowledge – what did that person see, hear, taste, touch.
Expert witness: A person that is qualified to give opinions about things he or she has no personal knowledge of. (A ballistics expert didn’t see the bullet come out of the gun but can opine that it came from a certain gun)
Expert report: Must include a complete statement of the expert’s opinions, the basis and the reasons for the opinions, information considered in forming the opinions, any exhibits to be used by the expert, qualifications of the experts, how much the expert is getting paid and any other case in which the expert has testified within the last four years. Very comprehensive stuff.
Rule Change! FR 26(b)(2)(B):
A party need not provide discovery of electronically stored information from sources identified as “not reasonably available”
Must identify withheld information
If requester files a motion to compel, respondent must show undue burden and cost to produce
Court must balance (cost/benefit) need for information against costs of production
It creates a dichotomy of different kinds of electronic information. Things that are reasonably available have to be produced upon request. Things that are not reasonably identifiable – things that you can’t get to without extraordinary measures like erased hard drives or backup tapes from surveillance.
26(b)(5)(B) Inadvertent Disclosure:
Sometimes you produce something that you shouldn’t have and we now have a procedure dealing with that.
• Step 1: Notify party of claim of privilege
• Step 2: Party receiving notice must return, sequester or destroy the material, or
• Alternate Step 2: Deliver the material to the judge for immediate ruling
Other Changes
• Rule 26(f) adds E-discovery issues to the topics to be addressed in the Rule 16 Conference Report
• Rules 33 and 34 are amended to include “electronically stored information” (and distinguish it from “documents”)
• Rule 37 (motion to compel) is amended to create a “safe harbor” from sanctions for parties acting in good faith to protect electronic information
30(b)(6) Depositions
n Deposition notice will describe matters on which testimony is sought
n Corporate defendant must produce witness qualified to testify to those matters
n Excellent strategy early in case:
–To learn what records are kept
–To learn corporate policies and procedures
DISCOVEROPOLY
Benson likes to test on 30(b)(6) Depositions! And let the court decide
DISCLOSURE VS. PRIVACY
Privacy of a nonparty: if someone is not a party, we are going to protect that privacy.
Rule 26. The Power and the Glory
a) Required disclosures
b) Scope and limits
c) Protective orders
d) Timing and sequence
e) Supplementation
f) Conference/Planning
g) Signature
c) Protective Orders:
Upon motion by a party or by the person from whom discovery is sought, accompanied by a certification that the movant has in good faith conferred or attempted to confer with other affected parties in an effort to resolve the dispute without court action, and for good cause shown, the court in which the action is pending or alternatively, on matters relating to a deposition, the court in the district where the deposition is to be taken may make any order which justice requires to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense, including one or more of the following:
(1) that the disclosure or discovery not be had;
(2) that the disclosure or discovery may be had only on specified terms and conditions, including a designation of the time or place;
(3) that the discovery may be had only by a method of discovery other than that selected by the party seeking discovery;
(4) that certain matters not be inquired into, or that the scope of the disclosure or discovery be limited to certain matters;
(5) that discovery be conducted with no one present except persons designated by the court;
(6) that a deposition, after being sealed, be opened only by order of the court;
(7) that a trade secret or other confidential research, development, or commercial information not be revealed or be revealed only in a designated way; and
(8) that the parties simultaneously file specified documents or information enclosed in sealed envelopes to be opened as directed by the court.
If the motion for a protective order is denied in whole or in part, the court may, on such terms and conditions as are just, order that any party or other person provide or permit discovery. The provisions of Rule 37(a)(4) apply to the award of expenses (sanctions) incurred in relation to the motion.
Privacy
Stalnaker v. Kmart
KS, 1996
NATURE OF THE CASE: This was a suit over sexual harassment and a dispute over a protective order that prohibited the plaintiff from deposing certain non-party witnesses.
The court was faced with a sexual harassment claim. Plaintiff sought to depose certain other employees about romantic or sexual conduct with the defendant and others, both voluntary and coerced. The court allowed discovery about conduct with the defendant, but not with others. Although acknowledging that the information was highly personal, the court also concluded that it was very relevant to plaintiff’s case.
The court is not willing to give Kmart the protection they are asking for here but the court does order that the information not be disclosed to anyone that is not involved in the litigation. The court is balancing the interests in order to get people to have some privacy interests while making sure the plaintiff gets what she needs.
Stalnaker Casebook Q’s:
• Would it be appropriate to start the deposition by asking, “Did you ever have a sexual relationship with Mr. Graves”?
– Yeazell: Yes
– Hastings: If I ever catch you starting a deposition with a question like that I will disown you. Ease into the question and find out what they are thinking – ask smaller questions before you get to the big question.
• Is it fair to infer that the witnesses didn’t care about the depositions?
– No, they work for Kmart and can’t afford a lawyer.
• Is the dynamic different if the witnesses themselves are seeking protection under Rule 26(c)?
– Probably
Physical & Mental Exams
Rule 35
On motion of party, a court can order another party to undergo a physical or mental exam
ØPhysical or mental condition must be “in controversy”
ØMovant must show “good cause”
ØApplies only to parties or those in custody or control of parties.
Schlagenhauf v. Holder
Supreme Court, 1964
D3 petitioned for a mental and physical examination of D under Rule 35; the District Court granted the petition and ordered D to submit to nine different examinations. D applied for a writ of mandamus for the mental and physical examinations to be set aside. The Court of Appeals denied mandamus and the Supreme Court granted certiorari because discovery cuts both ways.
Emanuel page 164:
Physical and mental examinations: FR 35 makes it possible to force a party to submit to a physical or mental examination. Unlike all other discovery devices, a party seeking a physical and mental exam must obtain a court order.
1. When available: A physical or mental exam may be ordered only for a party or person in custody or under legal control of a party.
a. Custody or control: The reference to a person under the custody or control refers to a ward, such as an infant or incompetent. The rights of infants and incompetents are usually litigated by guardians.
b. Need not be adverse: The party to be subjected to the examination need not be adverse to the movant; however, it is rarely possible to show good cause for examining a co-party since the requesting party will usually have no need for the information at trial.
2. Court order required: Unless the party to be examined consents, a party seeking a physical exam must obtain an order from the court in which the action is pending. The order is granted only if the party demonstrates that the physical or mental condition is in controversy and if good cause exists for the examination.
a. In controversy: The physical or mental condition of a party is in controversy if the condition is relevant to one or more claims or defenses before the court and if there is a genuine dispute concerning the condition.
i. Relevancy: Example: If defendant was insane at the time of signing a contract, the mental condition will be in controversy.
ii. Placing condition in controversy: Because of the highly intrusive nature of exams, the Supreme Court limited the ways in which a person’s physical or mental condition could be placed in controversy.
(a) A party may place his or her own condition in controversy in the pleadings by alleging a claim or defense that turns on that condition.
(b) However, a party may not place the condition of another party in controversy in the pleadings. Instead, the party needs to offer an affidavit or other affirmative evidence tending to show that the person’s condition is in controversy.
Example: Submit an affidavit of a person or witness who knows that the defendant’s eyesight is bad.
Hastings: The person has to be a party
Casebook Questions
• How does the Court deal with:
– The “in controversy” requirement?
• Doesn’t really discuss it but feels Contract Carrier has not met its burden
– The “good cause” requirement?
• Court is critical of materials submitted to meet standard
• Writs of mandamus are rarely granted. Why do you suppose this one made it to the Supreme Court?
– The district court’s work was slipshod—it held no hearing and granted more relief than was requested.
WORK PRODUCT DOCTRINE
RULE 26(b)(3)
• Common Law Fountainhead and Leading Case:
– Hickman v. Taylor
• Current codification:
– Rule 26(b)(3): Trial Preparation Materials
26(b)(3) protects trial preparation materials – it protects stuff, not facts, i.e. witness statements. No fact in a case is protected by the work product doctrine. Things that are created in anticipation of litigation are protected and are immune from disclosure in litigation unless you can pass a two-part test:
1. Substantial need for the information that’s covered in the work product materials; and
2. Inability to obtain by other means without great hardship
Exception: Party or nonparty may obtain his or her own statement. If you’ve taken a written statement from someone, a witness is entitled to get that statement.
Hickman v. Taylor
Supreme Court, 1947
NATURE OF THE CASE: This was an appeal from a judgment of civil contempt for the failure to produce work product pursuant to a discovery request.
FACTS: Five crew members of a tugboat drowned when it sank. The cause of the accident was unknown. A public hearing was held at which the four survivors were examined. Their testimony was recorded and was made available to all interested parties. Taylor (D), the tugboat owner hired an attorney (Fortenbaugh) to defend against potential suits by representatives of the deceased crew-members. In anticipation of litigation, the attorney interviewed the survivors and other persons whom he believed to have information about the accident. Representatives from all five deceased crew-members eventually brought claims. Four settled out of court, but the fifth brought suit in federal court under the Jones Act. Hickman (P) represented one of the deceased and brought this motion to obtain copies of the statements D's attorney obtained from the survivors. P filed interrogatories asking for any statements taken from crew members, and any oral or written statements, records, reports, or other memoranda made concerning any matter relative to the towing operation, the tug's sinking, the salvaging and repair of the tug, and the deaths of the deceased. D refused P's request under the attorney-client privilege. The District Court disagreed, not finding a privilege. It ordered D and his attorney to produce the material. They refused and were held in contempt. They appealed. The Court of Appeals reversed. P then petitioned the Supreme Court for review.
Jackson’s concurrence: “Discovery was hardly intended to enable a learned profession to perform its functions either without wits or on wits borrowed from the adversary.”
We are going to gather information on our own and not try and figure out what’s in the other lawyer’s head.
LEGAL ANALYSIS: The attorney had to get himself thrown in jail to win. Federal Rule 26(b)(3) was added because of this case. Federal Rule 26(b)(3) deals with the discovery of work product. It states that documents prepared in anticipation of litigation are discoverable only upon a showing that the party seeking such material has substantial need of them, and that he is unable without undue hardship to obtain the substantial equivalent of the materials by other means. Mental impressions, conclusions, opinions, or legal theories of attorney or other representatives of a party are to be protected against disclosure. Lawyers can waive this Rule, but their clients can't.
Hickman: Casebook Q’s
• What is the information sought?
– Written statements; information from oral interviews
• Is it relevant?
– Sure
• Is it privileged?
– No
So what’s the beef? We want to protect attorney mental impressions.
Rule 26(b)(3): Trial preparation and work product materials are protected from discovery and need not be produced EXCEPT when the information contained in such materials is not reasonably available from any other source.
Ø Applies to documents and tangible things prepared in anticipation of litigation.
Ø Doctrine applies only to parties and their agents.
Ø Broader than attorney/client privilege
To avoid application of the doctrine, a party must show:
Ø That there is no reasonable alternative source for the same or substantially equivalent information; and
Ø That the party has a substantial need for the information.
Ø Note:
§ Attorney’s mental impressions and legal evaluations receive a higher level of protection.
§ Party and witness statements are discoverable by person making the statement.
ØWaiver: Can’t disclose protected document to another
Casebook Hypos:
P is hit by B Company’s bus. B, a VP, comes to investigate.
• B makes a report to the Board. Discoverable?
– Probably—it doesn’t appear to be part of a claims investigation
• B makes a report to the claims department. Discoverable?
– Probably
• B makes the report to the attorney head of the claims department because the department head is fearful of suit. Discoverable?
– Probably not!
• Attorney for B Corp invests $10,000 in an investigation and discovers a new witness. May B Corp avoid disclosure of the witness based on work product?
– Never! Work product does not protect facts!
Boris’ Saga
• Boris is injured in an auto accident. Defendant’s insurer visits him in the hospital and takes a statement
• Can you get a copy?
– Yes
• Can you get it before Boris’ deposition?
– Probably not
• If there is no written statement can you get the contents of the statement?
– No
• Boris’ friend Frank gave a statement. Can Boris get it? How?
– Frank has to ask for it. Boris can get it from Frank.
Fortenbaugh Revisited
• What if the survivors died after Fortenbaugh interviewed them?
– Sounds like plaintiff could meet the burden
• What if the survivors forgot everything they told Fortenbaugh by the time Plaintiff interviews them?
– Plaintiff will have an uphill battle: The courts are reluctant to a lawyer’s lack of initiative
Major Points and Black Letter Law
FR 26(b)(3)
Exception to broad scope of discovery
Largely codifies Hickman v. Taylor
Protects:
Trial preparation materials
Not facts
“Conditional” privilege:
Overcome by showing of need
EXPERT DISCOVERY
RULE 26(b)(4)
Same as Work Product
Additional Discovery under Rule 26(b)(4)
Once you’ve done your 26(a)(2) disclosures and you’ve given the identity of your testifying experts and expert report, you have to give your testifying expert for a deposition. The deposition is not until after the 26(a)(2) disclosures.
Non-testifying experts only have to be subjected to discovery if they are also fact witnesses unless you can make the showing of exceptional circumstances just like the exceptional circumstances in Hickman v. Taylor. Like the work product rule, I am allowed to go out and talk to as many expert witnesses as I want to – not fact witnesses, but experts in the field.
• (A) Depositions of testifying experts
• (B) Discovery of non-testifying experts if they are fact witnesses (i.e. treating physician) under Rule 35(b); otherwise under a showing of “exceptional circumstances”
• (C) Costs of discovery to be borne by the party requesting it
Casebook Hypos (p. 447)
• Johnna is injured. Dr. Kildare is his treating physician.
• Dr Welby is Johnna’s expert witness, hired by John’s lawyer.
• Both doctors will testify at trial
• What information will have to be provided in the mandatory Rule 26(a)(2) disclosures
– About Dr Kildare?
• Nothing
– About Dr. Welby?
• Identity and conforming report
• Where will Dr Kildare be disclosed?
– In the Rule 26(a)(1) disclosures
• Must Johnna’s lawyer disclose Welby if he is not going to testify?
– No
• May Johnna depose Welby if he is not going to testify?
– Not unless she can show that there is no other expert who can provide the information she needs.
Thompson v. Haskell
FL, 1994
Thompson (P) sued Haskell (D) and her supervisor for sexual harassment. Dr. Lucas was retained by prior counsel to conduct a diagnostic review and personality profile on P. P alleged that because of sexual harassment by a supervisor employed by D, P was reduced to a severely depressed emotional state. P was terminated by D on June 5, 1992. P was then examined by Dr. Lucas on June 15, 1992. A report was prepared. D sought discovery of the report. D contends that the examination by Dr. Lucas is highly probative with regard to the allegations of the suit and that allegation is essential to P's case. P filed a motion for a protective order from discovery. P contends that Ruled 26(b)(3) and (4) protect a psychological report from discovery.
Circumstances exist which allow to pierce the non-testifying privilege. How does the Defendant meet the burden of showing exceptional circumstances? The information is not available from any other source.
HOLDING AND DECISION: (Snyder, J.) Is the report of a non-testifying psychologist discoverable under exceptional circumstances? Yes. Rule 26(b)(4)(B) provides that opinions and facts held by a non-testifying expert who had been retained by the opposing party in anticipation of litigation cannot be discovered except as provided under Rule 35 or if there is a showing of exceptional circumstances where it is shown that it is impracticable for the party seeking discover to obtain the same facts or opinions by other means.
Hastings: What if Thompson had already filed suit when Lucas examined her?
Different result?: Defendant knew of need to examine
Chiquita Int’l v. M/V Bolero Reefer
NY, 1994
NATURE OF THE CASE: This was a dispute about the application and classification of the status of a witness under Rule 26(b)(4)(B).
FACTS: This was a maritime action for the loss and damage to cargo. Chiquita (P) contracted International Refer to transport approximately 155,000 boxes of bananas aboard the M/V Bolero Reefer (D) to Germany. Because of malfunctions with the vessel's loading cranes only about 112,000 boxes were load and 43,000 were left on the wharf and were thrown away. The cargo that arrived in Germany was delivered in poor condition. Winer was employed by P as a maritime surveyor and examined the vessel when it arrived. After the inspection, P sued D. International Reefer sought the production of Winer's files and to depose him and P objected under 26(b)(4)(B). D claims that Winer is not an expert but a witness and even if he was an expert discovery is warranted because he was the only surveyor who inspected the vessel shortly after it arrived in Germany.
This case is similar to Thompson but we get the opposite result because of lack of diligence. It was their boat, why didn’t they look at the cranes? The other expert did, why didn’t you do your own investigation? The court is not going to allow the rule to be pierced or breached.
• “This argument would have merit if International Reefer had been precluded from sending its own expert to the scene by forces beyond its control…”
• “The failure of International Reefer to engage its own marine surveyor in a timely manner should not be rewarded…”
Hastings: What if the banana boat sank right after Winer examined it?
Different result? Defendant had less access but it is still Defendant’s boat!
Big Pieces: Expert Discovery
Ø Testifying Experts: Subject to automatic disclosure provisions of 26(a)(2), and can be deposed pre-trial (but after submission of report) per 26(b)(4)(A).
Ø Non-Testifying Experts: Protected from discovery, UNLESS
§ Expert is a treating or examining health professional [Rule 35(b)]
§ Party could not obtain facts or opinions on the same subject matter by any other means.
SANCTIONS
Rule 26(g)
(g) Signing of Disclosures, Discovery Requests, Responses, and Objections.
(1) Every disclosure made pursuant to subdivision (a)(1) or subdivision (a)(3) shall be signed by at least one attorney of record in the attorney's individual name, whose address shall be stated. An unrepresented party shall sign the disclosure and state the party's address. The signature of the attorney or party constitutes a certification that to the best of the signer's knowledge, information, and belief, formed after a reasonable inquiry, the disclosure is complete and correct as of the time it is made.
This sounds a lot like Rule 11, but Rule 11 does not apply to discovery because Rule 26 does.
(2) Every discovery request, response, or objection made by a party represented by an attorney shall be signed by at least one attorney of record in the attorney's individual name, whose address shall be stated. An unrepresented party shall sign the request, response, or objection and state the party's address. The signature of the attorney or party constitutes a certification that to the best of the signer's knowledge, information, and belief, formed after a reasonable inquiry, the request, response, or objection is:
(A) consistent with these rules and warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law;
(B) not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation; and
(C) not unreasonable or unduly burdensome or expensive, given the needs of the case, the discovery already had in the case, the amount in controversy, and the importance of the issues at stake in the litigation.
If a request, response, or objection is not signed, it shall be stricken unless it is signed promptly after the omission is called to the attention of the party making the request, response, or objection, and a party shall not be obligated to take any action with respect to it until it is signed.
(3) If without substantial justification a certification is made in violation of the rule, the court, upon motion or upon its own initiative, shall impose upon the person who made the certification, the party on whose behalf the disclosure, request, response, or objection is made, or both, an appropriate sanction, which may include an order to pay the amount of the reasonable expenses incurred because of the violation, including a reasonable attorney's fee.
This is what you are certifying when you sign your discovery request much like Rule 11. Sanction for violating this rule can be imposed on the attorney, the client, or both. The court has wide discretion in determining which sanctions are appropriate and those sanctions are found in Rule 37(b).
Typically they include expenses incurred by the opponent including reasonable attorneys fees (the most common sanction). As a practical matter 26(g) isn’t invoked all that often. The reason is that Rule 26(g) isn’t all that helpful to lawyers – all it does is provide for sanctions. Lawyers rely on Rule 37 – it provides for sanctions but more importantly it provides a mechanism so you can get the information/documents you seek. The reason you are filing this motions with the court is not so much to punish your opponent but to get information. Typically what you are filing is a motion to compel the discovery and in addition, judge, will you sanction this person for forcing me to bring this motion.
Rule 37. Failure to Make or Cooperate in Discovery; Sanctions – The workhorse of the discovery motions.
The focus of Rule 37 is getting the information and not just sanctioning the attorney for failure to provide. If an opposing party fails to make full disclosure or fails to respond to a discovery request, you make this motion seeking an order compelling discovery under Rule 37(a).
If your opponent objects to your discovery, it is under this rule that you bring the motion. Remember: not all discovery disputes are in bad faith. Sometimes there are legitimate arguments over relevancy, work product, privilege, etc., but you still use 37(a) to get the matter before the court.
You can file this motion if your opponent fails to make automatic disclosures required by 26(a) or fails to respond to discovery served pursuant to the discovery rules i.e. interrogatories, requests to admit, request to produce, etc. Importantly the motion must be accompanied by an affidavit by the moving party stating: that the moving party tried in good faith to contact the opponent, to meet, confer and resolve discovery disputes. In other words, “your honor this was a last desperate act to get my opponent to provide the discovery that I so richly deserve.”
The consequences of failing to attach the affidavit:
If I file a motion under 37(a) to compel you, and I don’t attach an affidavit (stating in good faith I tried to contact opposing counsel, etc.), the court will not grant sanctions (expenses and attorneys fees) but I still get the documents.
The current practice now requires that before a plaintiff files a motion to compel, the plaintiff must make a good faith effort to contact defendant. If the good faith effort is not made, no monetary sanctions will be granted. Under Rule 26(g) there is no requirement to meet and confer because the damage has been done (mislead the court, opponent lied, etc.) Under rule 37 you are still trying to get the information.
37(a)(4)(A) Expenses and Sanctions:
If the motion is granted or if the disclosure or requested discovery is provided after the motion was filed, the court shall, after affording an opportunity to be heard, require the party or deponent whose conduct necessitated the motion or the party or attorney advising such conduct or both of them to pay to the moving party the reasonable expenses incurred in making the motion, including attorney's fees, unless the court finds that the motion was filed without the movant's first making a good faith effort to obtain the disclosure or discovery without court action, or that the opposing party's nondisclosure, response, or objection was substantially justified, or that other circumstances make an award of expenses unjust.
What happens occasionally is you file your motion to compel and the court orders the material to be produced but your opponent still doesn’t comply. Look to 37(b): Failure to comply with an order. Now you are in serious trouble – the failure may be considered a contempt of that court and may result in the following:
1. The document may be excluded even if it helps your opponent as in evidence of damages, which will cause you to lose your case;
2. Order that all of your affirmative defenses be stricken – SOL, immunity, etc;
3. Issue a stay until the order is obeyed; and
4. The Death Penalty – the court may dismiss the action if it is the plaintiff or enter a default if it is the defendant who is in contempt. For that to take place the case law indicates that there must a pattern of failing to abide by the court’s orders.
Problems Page 453
Breach of Contract Case:
1. (a) Baxter refuses to answer. What to do?
Step 1: Good faith effort to confer/resolve
Step 2: Motion to compel under 37(a)(2)
(b) Are sanctions available?
Yes, 37(a)(4)
2. The CEO does not show up for deposition. What to do?
Step 1: Attempt to confer and resolve
Step 2: Motion under Rule 37(d) – Failure of Party to Attend at Own Deposition or Serve Answers to Interrogatories or Respond to Request for Inspection.
3. Can Arthur defend the Rule 37(d) motion by claiming the deposition was intentionally set to be burdensome? No, it failed to make a motion (protective order) under 26(c)(2)—See 37(d) (last sentence)—but it will likely mitigate sanctions.
4. This time the witness shows up for her deposition but the lawyer is obstreperous and after 7 hours the deposition is not over. As attorney for Baxter Corp, what to do? Move for more time under Rule 30(d)(2).
5. Baxter is uncooperative: Foot dragging, underproduction, overproduction with relevant documents buried. What to do?
Step 1: Good faith attempt to meet and confer
Step 2: Move to compel/Cite 37(a)(3)
6. Baxter’s lawyer wants $10,000 worth of depositions to explore a $5000 counterclaim. What to do?
Make a motion to limit discovery under Rule 26(b)(2)(iii): The burden or expense of the proposed discovery outweighs its likely benefit, taking into account the needs of the case, the amount in controversy, the parties' resources, the importance of the issues at stake in the litigation, and the importance of the proposed discovery in resolving the issues. The court may act upon its own initiative after reasonable notice or pursuant to a motion under Rule 26(c).
Thompson v. Department of Housing & Urban Development
MD, 2001
NATURE OF THE CASE: This was a dispute over a discovery request and a motion before the court to compel discovery.
FACTS: Thompson (P) is a class representative of African Americans residents of Baltimore public housing developments. P filed suit in 1995 against HUD (D) and others alleging that Ds and their predecessors from 1933 to present have established and perpetuated de jure racial segregation in Baltimore's public housing. Ps have filed a motion to compel Ds to provide responsive answers to Rule 33 and Rule 34 discovery requests.
The plaintiffs are looking for systemic patterns of discrimination going back many years.
The point of this case: Discovery is and has been self executing. The courts traditionally do not get involved in discovery unless a dispute arises. So, when a lawsuit is filed and the complaint is answered, the parties on their own begin to exchange interrogatories, do depositions and everything goes swimmingly. The judge doesn’t even know about your case until trial.
With the new amendments the court gets more involved with discovery and unchecked discovery disputes and people being driven into bankruptcy over discovery. This magistrate says, I recognize that were supposed to get more involved, but not this involved. The law says you have to make a good faith effort to meet and confer and you guys didn’t really do that.
The Rule 26(b)(2) Balancing Factors:
Is the discovery unduly cumulative or duplicative, or available elsewhere at lower cost?
Has the party seeking discovery had ample opportunity to obtain the information?
Does the burden or expense of the discovery outweigh its likely benefit, taking into account the parties’ resources and the amount in dispute?
The court held that the request was too broad. Instead, the plaintiffs and defendants were required to meet in a discovery conference, in which plaintiffs would be required to show how the particular information sought might relate to their actual claims and how the benefit of the information would outweigh the burden imposed on defendant.
Poole v. Textron
MD, 2000
NATURE OF THE CASE: Poole (P) requested attorneys' fees and sanctions against Textron (D) for discovery misconduct, and after ruling on the merits, the court determined whether an award of expenses including attorneys' fees or other sanction was justified under the governing rules and case law and, if so, the amount of expenses or sanction.
FACTS: This is a product liability case in which P sued D for alleged defects in a golf car, which resulted in serious injuries to him. The trial judge referred all discovery disputes to this Magistrate.
The court held that sanctions should be imposed on the defendant for failing to respond adequately to plaintiff’s discovery request. It explicitly found that defendant was not justified in objecting to plaintiff’s request, refusing to search its records, and failing to turn over documents and information to plaintiff.
One of the problems with discovery is that it overwhelming favors the party with dominant resources especially in personal injury cases where the attorney and the injured party oftentimes have very little resources in contrast to a large corporation.
This judge raises some important points:
1. Sanctions means punishment. It’s not designed to compensate the wronged party. Instead it’s a penalty to correct and deter bad behavior.
2. The court came down hard in this case (and not in Thompson) as a matter of style. Some judges are harsher than others.
3. The dispute arose early in the case and months went by before they finally complied.
DISCOVERY TOOLS
The most common discovery took is the deposition, request to produce, interrogatories and request to admit. You need to know how to use them in conjunction with one another. As long as you know what you have to prove to win this case or get it to a jury and what information can I get from this guy that’s going to support this claim. What information can I get from this witness that might contradict my claim? What information can I get that supports his defenses? You must always have in your mind exactly what your cause of action is. What is your theory of defense? What is your theory of liability? What do you have to prove? As long as you understand that thoroughly, the questions will come naturally.
Hypo 1: The plaintiff filed a lawsuit against her former employer alleging sex discrimination and sexual harassment. In the compliant she alleged emotional distress. The employer sent interrogatories and later wanted medical records. The plaintiff refused based on doctor-patient privilege. The defense says that plaintiff put her mental state at issue, therefore waiving the privilege.
The court held that plaintiff’s allegation was “garden variety” and that meant that she was suing for the same kind of stress that any person would feel of they were sexually harassed – not arguing that she suffered a mental disorder and relying on expert psychiatric testimony. The court said that she didn’t waive the privilege; however, at trial she will not be allowed to argue anything but “garden variety” humiliation and embarrassment because she didn’t produce any discovery to that effect.
Hypo 2: Plaintiff sues a railroad company and asks for a whole bunch of documents. The railroad doesn’t respond within the 30 day timeframe and it is only after plaintiff tries to meet and confer do they allege that the documents are privileged.
Rule 26(b)(5) Claims of Privilege or Protection of Trial Preparation Materials.
(A) Information Withheld.
When a party withholds information otherwise discoverable under these rules by claiming that it is privileged or subject to protection as trial-preparation material, the party shall make the claim expressly and shall describe the nature of the documents, communications, or things not produced or disclosed in a manner that, without revealing information itself privileged or protected, will enable other parties to assess the applicability of the privilege or protection.
Benson: Even if these documents are privileged, they’ve waived the privilege by failing to comply with the court rule. The argument in response is, yeah we screwed up but we didn’t waive the privilege because there isn’t anything in Rule 26 about waiving privilege. The court held that boilerplate objections or blanket refusals inserted in a response to Rule 34 (request to produce documents) are insufficient to assert a privilege. It’s not automatically waived.
Hypo 3: Gary Condit, “I’m not a perfect man” sued Dominick Dunn. Dunn accused Condit of a crime of moral in turpitude and that is considered slander per se and failure to obtain gainful employment. In his deposition he refused to answer:
1. Questions about any sexual relations. Condit did admit to the police that he had an affair with Chandra Levy and that could be used as impeachment.
2. Questions concerning his financial status. Financial information is discoverable because you can’t analyze a discovery question unless you know exactly what theory of liability is being argued, what the defenses are and whether this information sought is going to be relevant to those defenses. How do we know that he’s unemployed because of Dunn’s comments? He’s so wealthy he doesn’t need a job.
DEFINITIONS
Inference: A logical deduction. It’s what juries do everyday – infer from the evidence you’re your client is entitled to relief. Inferences are always optional. That’s what closing arguments are all about. Inferences are always optional – the jury can always reject.
Scott Peterson Example: No direct evidence (witnesses, fingerprints, DNA, etc.) but a classic circumstantial case (wife disappears, having an affair, suspicious comments, fishing, etc.) If you believe A, B, & C as true, we want you to infer from that he is responsible for Laci’s murder.
Car Accident Example: Two cars crashing on a rural road. Accident reconstruction experts will measure skid marks, look at the damage to the vehicles, etc, and from all of that they will infer which one of the drivers crossed the center line and a lawsuit may result from that.
Closing argument in Houchens case: If you believe that he hasn’t sent any letters, or contacted anyone in seven years, or made a credit card transaction – if you believe all that I want you to infer that he is dead.
Burden of Proof: Two separate concepts:
1. Burden of persuasion (risk of non-persuasion): Who has the burden of convincing the fact finder of any particular proposition? The burden rests with the person who wants to disrupt the status quo (almost always the plaintiff). Equipoise: If all things are balanced (50/50), it doesn’t disrupt the status quo. The concept of disrupting the status quo carries throughout the litigation. The general rule: The burden of persuasion never shifts to the other person.
2. Burden of production. Who has the burden of producing evidence of a particular proposition? The burden of production however, shifts back and forth during trial and during a motion for summary judgment. If you do not want to produce documents, the burden then shifts to you to seek a protective order.
All relevant evidence is admissible unless there is a rule that says it isn’t. If it’s hearsay, the burden of proof shifts back and forth.
Presumption: Think of presumption as a mandatory inference. A presumption is not optional. If you believe A, B, & C, then you must find or infer for the person providing the evidence.
Mailbox Rule Example: If I drop a properly stamped and addressed letter in a mailbox, it is presumed that it was delivered. The mail goes where the mail is addressed. The reality is if you mail that letter, they almost always get it. If you can establish to the jury that you properly addressed and stamped the envelope and you put it in an authorized mailbox, we will instruct the jury that they must infer that the person received the letter.
Closing argument in Houchens case with the statute: It is presumed that after seven years he is dead; therefore, you must infer that he is dead. If the insurance company cannot produce evidence to the contrary, they will lose as a matter of law.
RULE 56
Rules 12(b)(6), 12(c) and Rule 56
• Rule 12(b)(6) or 12(c): “Facial attack”--challenges the claim or defense shown on the “face of the pleading.”
• Rule 56: “Pierces the pleading”—challenges the factual basis of claims and defenses
The difference between 12(b)(6) and 56 is 12(b)(6) is based on the pleadings and 56 is based on facts. For a 12(b)(6) motion the judge looks only at the complaint or the answer (if it fails to recognize a valid defense), and the judge doesn’t look beyond the pleadings. If the court finds as a matter of law that the pleadings are insufficient, the judge dismisses that case. If the judge finds himself looking at evidence outside the pleadings, you are deciding the case under Rule 56 – it is designed to test the facts.
Inmate Medical Malpractice Example: A doctor performs a procedure on an inmate under unsanitary conditions and the inmate gets infected. To sue the government in a civil rights violation (government doctor, government institution), you cannot sue for ordinary malpractice – they are immune from that. If you sue for civil rights, you have to allege a constitutional violation. The government cannot impose cruel and unusual punishment (Eighth Amendment). You have to show extreme indifference to your serious medical needs. State v. Gamble
Under Rule 12(b)(6):
You draft a malpractice complaint. In lieu of an answer, the government files a 12(b)(6) motion. Is it going to be granted? Yes, the law requires more (constitutional violation). If you add different causes of action, you have stated a claim and a 12(b)(6) motion will be denied.
Under Rule 56:
Based upon the facts of the case, it will be dismissed under Rule 56 – there is no evidence that could possibly support a claim for extreme indifference to medical needs.
Rule 56 makes reference to a genuine issue of material fact. That means that if there is evidence before the court that a reasonable jury could find in favor of the person producing the evidence, then there is a genuine issue of material fact.
Example: During a motion for summary judgment, if the non-moving party (the party against whom the motion has been filed) can produce sufficient evidence that a reasonable jury could find in the non-moving party’s favor, then there is a general issue of material fact.
Keep in mind:
1. It must be based on admissible evidence, i.e. the evidence produced has to be evidence that the court is reasonably sure is actually going to be admitted.
Example: An affidavit is not admissible in court typically because it’s hearsay. It’s an out of court statement. You can’t use an affidavit; the person has to testify live under oath and subject to cross-examination. The person does not have to testify live at a Rule 56 hearing – the affidavit is sufficient. What an affidavit says in effect is: when called upon this is what I am going to say. The evidence has to be admissible but it doesn’t have to be in the form of admissibility at the time of the hearing.
2. In deciding the motion, the judge may not weigh the credibility of the evidence. If believed, can a reasonable jury find in this party’s favor? That’s all the judge asks.
Example: If called upon I am going to testify to the following: ______. The judge may not look at the affidavit and say that he does not believe the testimony, therefore rule against it. The judge cannot judge the credibility of the evidence (that’s for the jury), he can only determine whether the evidence is sufficient.
In order to point to the court what the genuine issue is, you draw upon discovery, i.e. interrogatory answers, deposition transcripts, documents produced, etc. That is what is going to be produced during trial; thus, there is or isn’t a general issue of material fact.
Anatomy of Rule 56
• (a) For Claimant: A claimant may move for Summary Judgment
– 20 days from commencement of action,
– “With or without” affidavits,
– As to “all or any part” of the claim
• (b) For Defending party: A defendant may move for Summary Judgment:
– At any time,
– “With or without” affidavits,
– As to “all or any part” of the claim
• (c) Motion and Proceedings:
– Motion served at least 10 days before hearing
– Adverse party may serve opposing affidavits prior to hearing
– Judgment may be rendered on the basis of:
• Pleadings
• Depositions
• Interrogatory answers
– Must be “no genuine issue as to any material fact”
• (d) Case Not Fully Adjudicated on Motion:
– The court need not resolve the entire case
– May resolve some fact issues and not others
– May resolve some portions of the case and not others
– Court issues order specifying what has been resolved and what remains in controversy
• (e) Form of Affidavits; Further Testimony; Defense required
– Affidavits must:
• be based on personal knowledge;
• set forth facts that would be admissible into evidence
• Show affirmatively that the affiant is competent to testify
• Documents must be authenticated by affidavit and attached thereto (this rule is often honored in the breach)
• (e) Form of Affidavits; Further Testimony; Defense required
“The court may permit affidavits to be supplemented or opposed by depositions, answers to interrogatories or further affidavits.”
• (e) Form of Affidavits; Further Testimony; Defense required
“When a motion for summary judgment is properly made and supported:
• The adverse party may NOT rest upon allegations or denials
• The adverse party must respond with affidavits or otherwise, identifying specific facts showing a genuine issue for trial.
• (f) When Affidavits are Unavailable
– If the affidavits of a party opposing summary judgment show that the party cannot for valid reasons present facts necessary to defend the motion, the court may:
• Deny the motion, or
• Order a continuance to allow additional time or discovery, or
• Make such other order “as is just”
• (6) Affidavits Made in Bad Faith
– If the affidavits of a party are imposed
• In bad faith, or
• Solely for purposes of delay
The court:
• Shall order the party employing them to pay reasonable expenses and fees, and
• May adjudge the offending party or attorney guilty of contempt.
Example Affidavit:
Affidavit of Publius Porker
I, Publius Porker, being first duly sworn, hereby testify as follows:
I have personal knowledge of the matters contained in this affidavit and am competent to provide testimony as to these matters.
The documents attached hereto as exhibits A-D are true and accurate copies of records kept in the ordinary course of business at Porker Enterprises.
On March 15, 2006, the Plaintiff agreed to work late. I left the office at the regular time and went home to honor my wife on the occasion of our Anniversary. I never laid a hand on plaintiff.
Publius Porker
(notary)
SUMMARY JUDGMENT
The purpose of summary judgment is to isolate and terminate claims and defenses that are factually unsupportable before trial so you don’t waste judicial resources trying cases over which the person does not have sufficient facts to support the claim. Defendant has the initial responsibility, or burden, of demonstrating to the court the absence of a genuine issue of fact.
Celotex Corp. v. Catrett
Supreme Court, 1986
FACTS: Catrett (P) sued several asbestos manufacturers, claiming that the death of her husband resulted from exposure to their products. P's suit was in negligence, breach of warranty, and strict liability. Celotex (D) moved for summary judgment; no evidence existed that the decedent had been exposed to D's products. P produced three documents which she claimed demonstrates that a genuine factual dispute exists. D argued that the documents were inadmissible hearsay. The district court granted the motion for summary judgment; there was no showing that P's husband had been exposed to D's products. The court of appeals reversed; D had not offered sufficient evidence to rebut P's allegations in the form of affidavits or otherwise. The Supreme Court granted certiorari.
ISSUE: If information derived through discovery indicates that the non-moving party (here P) cannot prove an essential element of her cause of action at trial, must the moving party (here D) still come forward with evidence in the form of affidavits or other information to show the absence of a genuine issue of material fact within the meaning of Rule 56(c)?
No. The court held that the defendant need not offer proof that negates plaintiff’s case. It need only show that plaintiff has failed to meet the burden of production. (On the other hand, if defendant does have affirmative evidence that negates an element of plaintiff’s claim, it is free to introduce it.)
However, defendant cannot simply assert that plaintiff has no evidence. Instead, it must point out to the court those parts of the depositions, affidavits, and other evidence that demonstrate that plaintiff has no evidence on one or more elements of its claim.
Thus according to the Celotex standard there are two ways for a movant to prevail in summary judgment (supposing the respondent has no counter argument). One way is to offer evidence to negate one of the elements of the claim. The second is to show that plaintiff has no evidence to support the claim.
Benson: Whoever has the burden at trial is going to be required to produce admissible evidence at the Rule 56 hearing to show that there is a genuine issue of material fact.
While this case has been interpreted as shifting the burden of proof for summary judgment from the movant to the respondent (thereby over ruling Adickes v. S.H. Kress Co. 1970), the movant still must "show" the respondent does not have enough evidence to make out a prima facie case (for example by pointing out specific discovery responses where the respondent admits a lack of evidence).
Motion for partial summary judgment: Asking the court dismiss some of the counts if there is not enough evidence to support them; thus narrowing the issues.
4(a): The expert’s affidavit is sufficient to move the proposition into the realm where reasonable minds can differ
4(b): Causation is a material fact and she has to prove it and it’s going to be a genuine issue of material fact and that is more for a judge to decide. In a motion filed per Rule 56, the judge decides. If he or she decides there is no genuine issue of material fact, then there is nothing to submit to a jury. If the judge decides that there is a genuine issue of material fact, then the case goes to trial and the jury decides the issue.
5(a): Only if attached to an affidavit sufficient to establish that it is admissible into evidence.
5(b): At best this might justify some additional time for plaintiff to peruse Defendant’s records. See FRCivP 56(f)
The affidavit requires that it be made on personal knowledge.
5(c): NO!! The affidavit establishes only that it’s maker has no personal knowledge!
Bias v. Advantage International, Inc.
DC, 1990
This case illustrates how a defendant shows the absence of facts necessary to support plaintiff’s claim. The plaintiff in this case was the estate of a college basketball star. The decedent dies two days after being selected in the first round of the NBA draft. The estate claimed that defendant, decedent’s agent, had breached its promise to procure life insurance covering decedent. Defendant admitted that it had breached this promise but countered by asserting that decedent’s drug use would have made it impossible to procure a policy (an affirmative defense). Defendant supported this allegation with evidence showing that decedent used drugs regularly and that no life insurance company would issue a policy to a drug user. The court held that this evidence was enough to demonstrate no genuine issue of material fact. Moreover, because plaintiff had no real evidence suggesting the contrary, summary judgment for defendant was appropriate.
ISSUE: Was there a triable issue of fact as to whether Bias was a drug user?
Affirmative defense: We concede that everything you say is true; however, we are still not liable.
Houchens v. American Home Assurance Co.
4th Circuit, 1991
NATURE OF THE CASE: This was an appeal of dismissal of an action for damages for a breach of contract on two insurance policies.
FACTS: Houchens' (P) husband disappeared after arrival in Thailand in August 15, 1980, and was not heard from since. A number of agencies searched for the husband including the FBI, ICAO, the Red Cross, and the State Department. Under Virginia law, a person who is missing for seven years is presumed dead. On April 29, 1988, P had her husband declared legally dead. P attempted to collect on two life insurance policies issued by American (D). Both were accidental death policies. The proceeds of those policies were to be paid upon proof that P's death was accidental. D refused to pay and P sued in federal court for breach of contract. D moved for summary judgment; there was no evidence that the insured had died or that he had died accidentally. D's motion was granted and P appealed.
ISSUE: Did the district court err in granting summary judgment in favor of D?
No. Neither party had any direct evidence on the crucial issue of whether a person’s death was accidental. Because the plaintiff had the burden of proving that the death was accidental, the court held that summary judgment for defendant was appropriate because she could not prove that her husband died an accidental death.
RULE 56
According to Celotex, a party files a motion for summary judgment under Rule 56. Whenever a motion for summary judgment is filed, whoever has the burden at trial has the burden at the Rule 56 motion. If the defendant files the motion, the defendant’s initial burden is simply to identify to the court what part of the plaintiff’s case that the defendant believes the plaintiff does not have sufficient evidence to prevail on.
RULE 16
Provides an opportunity for the court to organize and call on a pretrial conference. A pretrial conference gives the parties an opportunity to introduce themselves, introduce the facts of the case, and sort out any problems from the Rule 26 meet and confer.
The court produces a scheduling order which basically states that discovery is going to end on such and such date. The court will address issues of Joinder and any objections therein. The judge may give informal opinions as to the merits of certain claims or defenses, address discovery issues and the court is always exploring settlement. A settled file is a closed file and judges love closed files (more time to golf).
16(d). Final Pretrial Conference, Order
The final pretrial conference is usually held after discovery and usually fairly close to the trial date, but after any Rule 56 hearings. It is an extremely important conference which typically is a settlement conference. Although the language of the rule doesn’t specifically say it, the case law is clear that the court can order parties to attend.
Trial date is set as well as dates for any remaining motions (except for Rule 56). The local rule usually requires the parties to meet and confer and produce a joint pretrial statement. The pretrial statement has to state both sides and all of the parties’ legal theories and defenses. It will require the parties to provide a list of witnesses and documents that will be presented at trial. It also requires to parties to anticipate and inform the court what legal or evidentiary problems the parties anticipate (what’s likely to arise at trial).
The court takes the pretrial statement and reduces it to an order. The order becomes a roadmap and you cannot deviate from that roadmap (the court doesn’t like surprises). The only way to deviate from the road map is to amend the pretrial order which will only be done if you can show that “manifest injustice” will occur if it is not granted.
16(f). Sanctions
16(f) provides sanctions for a party or its attorney who:
1. Fail to appear at a scheduling or other pretrial conference;
2. Is substantially unprepared to participate or does not participate in good faith, i.e. a party that shows up denying they have the authority to settle the case – that’s considered bad faith; and
3. Fails to obey a scheduling order or other pretrial order.
The Sanctions are the same as in 37(b): expenses, dismissal, etc. Because this conference is so close to the trial date (typically just two weeks before), the sanctions for missing this tend to be quite severe.
Sanders v. Union Pacific
9th Circuit, 1998
Overworked attorney case
NATURE OF THE CASE: This was an appeal from a dismissal of a law suit with prejudice.
FACTS: Sanders (P) sued Union Pacific (D) under the Federal Employer's Liability Act for a work related injury. The trial date was set for November 1996 and a pretrial conference was set 10 days before the trial. The judge also issued an order setting forth the various time frames for various motions, oppositions, proposed instructions and other trial related documents. The order warned that a failure to comply will result in sanctions. P's counsel refused to comply with almost all of the requirements of the pretrial order. (A list of offenses is contained on page 528 Yeazell 6th). During the pretrial conference with a law clerk, P's counsel explained his delay in the present matter as resulting from another lawsuit involving a multiple death train collision. P's counsel made it clear that he was not prepared to go to trial and suggested a dismissal without prejudice. The trial judge dismissed the action with prejudice. P appealed.
HOLDING AND DECISION: (Per Curiam) Does a failure to contact a court or opposing counsel over the inability to meet the deadlines in a pretrial order justify a dismissal of the action with prejudice? Yes. Under these facts, P only informed the court of his troubles at the last minute and left the court with no ability to impose lesser sanctions. P's contention that the court violated Due Process because it failed to notify him that dismissal was imminent is without merit as the original court scheduling order expressly advised P that dismissal was a proper sanction for failure to comply. The trial court did not abuse its discretion by not choosing a less drastic sanction. We reject P's contention that the dismissal violated Due Process because P was not informed that dismissal was imminent. The court order was clearly and expressly notices that failure to comply could lead to a dismissal. The mere lack of a hearing does not advance P's cause. Affirmed (but later reversed for a different judge to hear the case in banc – a super panel of judges).
Dissent: (Canby, Judge) Dismissal is a harsh penalty and should be imposed only as a sanction in extreme circumstances. P's counsel was guilty of multiple failures but they all occurred at once as part of the pretrial conference as part of his general inability to be ready for the trial. This was not an instance of repeated dilatory behavior over a span of time. Litigation was also not inordinately delayed such that any rights of D were significantly impaired. P should have been warned that dismissal was imminent. A boiler plate warning in a preprinted order does not put a party on notice that dismissal is imminent.
Mistakes
Attorney unfortunate failures:
• Missed in limine deadline
• Did not meet and confer on jury instructions
• Exhibit and witness lists late
• No trial brief
• No response to defense’s in limine motions
Attorney critical failure:
• Did not ask for a continuance
Court unfortunate failure:
• Court did not hold a scheduling conference, instead issuing a “boilerplate warning on a preprinted form.”
Court critical failure:
• Court allowed a law clerk to hold final pretrial; never provided attorney an opportunity to be heard.
McKey v. Fairbarn
DC, 1965
NATURE OF THE CASE: This was an appeal from a directed verdict and a denial of a motion to amend.
FACTS: Fairbairn (D), acting as the agent of Haynes, rented a dwelling house to McKey (P) on a month to month basis. A leak was discovered and D agreed to eliminate the cause of the leak. Before D could act the room leaked again and Mrs. Littlejohn, P's mother in law, mopped up some of it but slipped and fell and sustained injuries. Littlejohn sued for damages, and at trial her counsel agreed with the trial judge's assessment of the case as one in negligence. Thereafter and during trial, counsel moved to amend the complaint and pretrial order to include citations to certain allegedly relevant housing regulations, but the judge denied the motion and directed a verdict for D. P appealed. Note: Littlejohn died from causes unrelated to the accident and P took over the suit as administratrix.
• Theory One (pretrial):
– Negligence
• Knowledge of defect
• Duty to repair
• Theory Two (middle of trial)
– Strict Liability under Housing Code
• Knowledge of defect unnecessary
It’s not fair to the defendant to switch gears and change the theory of the case just before trial.
JURY TRIALS
Seventh Amendment:
In suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise reexamined in any court of the United States, than according to the rules of the common law.
Courts today do a historic analysis; if your claim was recognized at common law in 1791, then according to the Seventh Amendment you have an absolute right to a jury trial.
If your claim was not recognized at common law in 1791 but rather was something tried before the court of equity, you are not entitled to a jury trial.
Rule of Thumb:
If you are looking for a judgment (money), that is typically a legal issue (jury trial)
If you want the judge to order your opponent to do something or to stop doing something, that is an equity issue (non-jury trial).
Two-Part Test:
1. The first step is to identify the closest historic analogue to the action in eighteenth century English practice and determine whether that historical analogue would be heard in Law or Equity.
2. The second step is to analyze the nature of the remedy sought and determine if it is legal or equitable in nature. Benson: What do you want?
Chauffeurs, Teamsters, & Helpers v. Terry
Supreme Court, 1990
In July 1983, plaintiffs brought suit against both the Union and McLean Trucking Company in the United States District Court for the Middle District of North Carolina, alleging that McLean had violated the collective bargaining agreement in violation of the Labor Management Relations Act, 29 U.S.C. § 185, and alleging that the Union had breached its duty of fair representation. Plaintiffs requested a permanent injunction requiring the defendants to restore their seniority and cease their illegal activity. They further requested compensatory damages for lost wages and health benefits. McLean filed for bankruptcy in 1986, and all the claims against it were voluntarily dismissed.
Plaintiffs had requested a jury trial in their pleadings, but the Union moved to strike the demand for a jury trial, on the grounds that the no right to a jury trial exists in a duty of fair representation suit. The District Court denied the defendant’s motion to strike, and the United States Court of Appeals for the Fourth Circuit affirmed, holding that the Seventh Amendment entitled the plaintiffs to a jury trial on their claims for monetary damages.
ISSUE: Are P’s entitled to a jury trial on their duty of fair representation claim?
P’s sue the truck company for violating the bargaining agreement (breach of contract).
P’s sue the union for fair representation (breach of duty).
Since actions to enforce collective bargaining agreements were unknown in 18th-century England (such agreements were unlawful at the time), the union argued that the action brought by the plaintiffs was, in essence, an attempt to vacate an arbitration award, which historically was considered an action in equity. Marshall rejected this argument because there had been no arbitration with regards to the union’s duty of fair representation. The union further argued that the suit was comparable to an action for breach of fiduciary duty (i.e. a suit concerning a trust), which was also considered an equitable action. The plaintiffs countered by comparing their suit to an action against an attorney for malpractice, which was an action at law.
Marshall conceded that the analogy to a trust action was more convincing, but reasoned that the right to a jury trial depended more on the nature of the issues to be tried. Although there was a fiduciary duty issue between the plaintiffs and the union, there was also an underlying breach of contract—that of the collective bargaining agreement between McLean and the plaintiffs.
Since the first part of the analysis failed to produce a dispositive result, Marshall then turned to the type of relief the plaintiffs sought. The only remaining remedy the plaintiffs sought against the union was compensatory damages, which are the traditional legal remedy. While restitutionary remedies such as back pay and benefits may be characterized as equitable when sought from an employer, the damages here were sought from the Union. Thus, Marshall held that the plaintiffs were requesting a legal remedy, and therefore, on the balance of the issues, were entitled to have their case heard by a jury.
Section III(A)
Union:
Action to vacate arbitration award
Action against a trustee for breach of fiduciary duty
Plaintiffs:
Malpractice action. The court didn’t like this argument because a client can always fire their attorney.
Equipoise:
Claim against Union: Like a breach of fiduciary duty claim
Claim against Employer: Like contract claim
Section III(B)
The only remedy sought is a request for compensatory damages.
Brennan’s Concurring Opinion: “There remains little purpose to our rattling through dusty attics of ancient writs. The time has come to borrow William of Occam’s razor and sever this portion of our analysis.”
Occam’s razor: "All things being equal, the simplest solution tends to be the best one."
Benson on Brennan: Why bother with the two-part test? Part one: not entitled to a jury, Part two: he is entitled to a jury. Why not skip one?
The historic analysis is important because you will deal with the issue of whether or not a particular claim existed in 1791.
RULE 38
Rule 38. Right to Jury Trial; Demand
(a) Right Preserved.
The right of trial by jury as declared by the Seventh Amendment to the Constitution or as given by a statute of the United States shall be preserved to the parties inviolate.
(d) Waiver.
The failure of a party to serve and file a demand as required by this rule constitutes a waiver by the party of trial by jury. A demand for trial by jury made as herein provided may not be withdrawn without the consent of the parties.
Benson: You can’t demand a jury trial and then wait just before trial to waive a jury trial. Your opponent has already relied on the fact that he or she will be arguing a jury trial. You prepare for a jury trial much differently than you would for a bench trial.
The Seventh Amendment has never been incorporated to the states.
Synopsis of Rule 38:
• Right is “preserved inviolate”
• Demand – Made in writing, filed and served on the parties
• Must be timely: within 10 days of last pleading directed to the issue
• Demand specifies the issues to be tried to a jury (“Demand trial by jury on all issues so triable”)
• Another party may designate additional issues
• Failure to timely demand constitutes WAIVER
• Must pay the filing fee or right to jury trial may be waived
Amoco Oil v. Torcomian
3rd Circuit, 1983
Torcomian (D) appealed from the judgment which denied D a jury trial on Amoco's (P) complaint that sought D's ejectment, among other equitable remedies. D also sought review of the denial of their compulsory counterclaims of fraud and breach of contract.
Amoco does not want a jury trial (big company going against the little, local guy).
Under federal law, which controls in this diversity action, actions seeking ejectment are deemed to be legal, not equitable.
D’s stated a compulsory counterclaim (arising out if the same transaction or occurrence) that included a claim for legal relief when they sought damages for breach of contract.
Amoco’s Claims: Legal or Equitable?
1. Ejectment Legal
2. Injunction restraining use of station Equitable
3. Injunction restraining use of name/logo Equitable
4. Money damages for lost profits Legal
5. “Mesne profits” Equitable
Torcomian’s Counterclaims:
1. Specific Performance Equitable
2. Claim for lost profits Legal
JURY TRIAL, SELECTION
Voir Dire or Jury Selection
Jurors are picked at random. Jury selection is very hard to do.
Two types of challenges:
1. For cause A specific conflict of interest between the jury and the situation, i.e. a relative of the defendant, employee of the company, etc.
2. Preempts (you get three) You cannot preempt based solely on race. If you don’t have a good reason why all three preempts were the same race or gender, you may be looking at a mistrial.
Opening Statements
The plaintiff usually starts with the opening statement (not argument). It’s a subtle argument but you can’t blatantly argue or you will draw an objection.
After the defendant gives his opening statement, the plaintiff begins his case. When the plaintiff calls his witnesses, he can only ask a direct question (open-ended question) and not a leading question as in cross-examination.
The essence of a trial is cross-examination.
The defendant presents his witnesses and asks direct questions, the plaintiff asks leading questions on cross-examination.
Closing Arguments
Lawyers can suggest what inferences the jury should draw. Only what the witnesses say is evidence but argument is perfectly permissible. The person with the burden of proof goes last.
Always poll the jury to check the votes.
APPELLATE PROCESS
Appealing Cases
You can only appeal if you suffered a grievance.
Adversity: Casebook Q’s (pp. 620-21)
1. If her damages are the same, she hasn’t lost anything. If she loses on the municipal code issue, she wins on the lease issue. If her damages are the same then she has suffered no loss and cannot file the appeal even though she lost a part of her case.
(a) Tenant injured slipping in water from leaking roof. Two theories:
1. Breach of lease;
2. Violation of municipal code. She wins on lease, loses on code. Damages are the same. Focus on what she is entitled to under each theory.
Can she appeal? No
Can lawyers appeal to avoid poor precedent? No
Can a tenants’ association appeal? No
(b) Plaintiff claims Dealer told her used car was new. Two theories:
1. Breach;
2 Fraud.
Court finds for plaintiff on contract, but not on fraud.
May she appeal? Yes, damages are different (difference between a new vehicle and punitive damages). Remember: What can you recover under each cause of action. Breach of contract claims can get jumbled up with tort claims and they typically are different.
(c) May Defendants appeal? Yes.
Have limits to representation in your retainer agreement, e.g. my representation ends at the trial court level and this agreement does not include an appeal. If you want an appeal, we enter into a separate agreement.
Mootness Doctrine
Moot: When a controversy has been resolved. It is grounded in the Constitution. Article III – the Federal Court have jurisdiction over cases and controversies.
Exception to the Mootness Doctrine:
There are certain types of controversies that by definition can never last long enough in order to get judicial review – capable of repetition but evading review.
Roe v. Wade Example: By the time the case went to the Supreme Court, the baby was already born – she could not get the relief she was seeking; therefore, the issue was moot. However, the exception allows the case to go forward.
Iowa divorce case Example: Supreme Court, 1975. A woman wanted to get a divorce and Iowa required her to live in Iowa for one year to get a divorce. By the time the case gets to the Supreme Court, she had lived there for a year. The Court upheld the Iowa law but the point being is they decided the case even though it was technically moot; however, she is representing any person who wants a divorce but has not lived in Iowa for one year.
WAIVER
Waiver – Preserving an Issue for Appeal
Black Letter Rule: In order to reach an issue on appeal, it must have been raised and ruled upon in the trial court.
Benson: This is a huge area of the law and ripe with malpractice.
Malpractice trap: If you don’t raise the issue at the lower court level, you have waived the issue. The courts are extremely hard on waiver. The issue has to be raised and be on the record as well as being very specific as to what you are asking for and why you believe you are entitled to it. The court will not entertain new arguments on appeal. This is makes it difficult for a trial lawyer.
You must list all of the reasons in an objection. You can’t just zero in your opponent’s weakness, you have to argue all issues on why your opponent is wrong. If you don’t, you waive all the other issues.
The Record: If it’s not on the record, it’s waived. Make sure that if something of substance happened at side-bar or in chambers, make sure it gets on the record in the presence of a court reporter. If it’s not on the record, it never happened.
Court policy:
1. You have to give the trial judge an intelligent basis for a fair decision. Your job is to know the law and convince the judge of the correctness of your decision. The judge can’t do that if you don’t tell the judge what the law is.
2. The appellate courts know that attorneys “sandbag” – knowing you are going to lose a case and will appeal not objecting to the issues. If you lose, you can tie it up on appeal for years hoping the other side will settle, run out of money, etc. The appellate court don’t allow for that. If you choose not to make the objection or make the argument at the trial court level, you’ve waived it.
3. You have to give the trial judge the opportunity to correct his or her own mistakes.
4. Weed out litigants.
It is one of the heaviest burdens on any lawyer who does litigation.
WAIVER EXCEPTION
Harmless Error (for Appellee only)
Black Letter Exception: An appellee may raise new issues as grounds for affirmance of an arguably wrong ruling. Issues not raised in formal cross-appeals are often raised in this fashion
Plain Error Doctrine
Appellate courts will hold trial courts accountable for truly bad applications of law under the “Plain Error” doctrine.
If a ruling from the court is so plainly erroneous, the court may take up that issue at its discretion even if it wasn’t objected to or “preserved” below. Think if it in terms of the court and the court’s power. Don’t ever count it because they don’t do it very often.
The ultimate waiver: SMJ. You can always argue subject matter jurisdiction at any level of the proceedings.
28 U.S.C. 1291
• 28 U.S.C. § 1291: “The courts of appeals shall have jurisdiction of appeals from all final decisions of the district courts of the United States….
• A final decision “is one which ends the litigation on the merits and leaves nothing for the court to do but execute the judgment.” Catlin v. US, 324 US 229 (1945).
Benson: In other words, if it isn’t a final decision, we have no jurisdiction, meaning, even if we want to hear the case, we can’t hear the case. Parties cannot stipulate to federal jurisdiction.
At the end of a final judgment, the appeal is by right. Absent the interlocutory appeal, any decision that a court makes leading up to the final judgment is un-reviewable.
Prevents parties from agreeing and stipulating jurisdiction
Liberty Mutual Insurance v. Wetzel
Supreme Court, 1976
NATURE OF THE CASE: This was an appeal from a partial summary judgment that found liability for violations of the Civil Rights Act. .
FACTS: Liberty Mutual Insurance Co. (D) was sued by its employees for violations of the Civil Rights Act of 1964. Ps contended that D's employee insurance benefits and maternity leave provisions violated Title VII of the Act. They sought a declaratory judgment, an injunction and damages. The district court granted the motion of Wetzel (P) for summary judgment for liability only, but not for any relief. D appealed, and the court of appeals affirmed. D appealed to the Supreme Court; a partial summary judgment is an appealable final judgment.
HOLDING AND DECISION: (Rehnquist, J.) Is a partial summary judgment for liability only appealable under 28 U.S.C. Section 1291? No. A court of appeals does not have jurisdiction to review a partial summary judgment. Section 1291 allows appeals from final judgments. Liability was established, but no relief was given; the judgment is not final. The court's action was an interlocutory order, which would have to be appealed under 28 U.S.C. Section 1292. The requirements for Section 1292 were not met in this present case. If injunctive relief had been granted the order would have been appealable under 1292(a)(1) but no such relief was granted herein. Rule 54(b) does not apply as well because the action is on a single claim. Congress at times has provided exceptions to the final judgment rule but none of those exceptions apply herein. Appeal dismissed.
Benson: This is a great example of how the appellate courts want to keep you out of their hair.
District Court: Hiring Policies violate Title VII. “…it is expressly directed that Judgment be entered for the Plaintiffs upon these claims of Plaintiffs’ Complaint, there being no just reason for delay.” Rule 54 – The judge can put language in the order making the case final.
RULE 54 – MUST READ!
When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment. In the absence of such determination and direction, any order or other form of decision, however designated, which adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties, and the order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties.
Benson: When you have multiple parties/multiple claims, and the court resolves some but not all of the claims, the court may put that language (no just reason for delay) in the final order. That makes that part of the order a final judgment and that means the court of appeals has jurisdiction to hear the case. If the court doesn’t put that language in there, then it’s not a final judgment. It puts tremendous authority in the hands of the district court to determine who at that point can appeal. It is entirely discretionary with the trial court.
Petitioners win at the court of appeals.
Supreme Court: Sua sponte (on their own) The court of appeals had no jurisdiction. The Court reads 54(b) and they find that it is limited to multiple claim actions and this case had only one claim.
Rule 54(b): Key concept
The court must resolve one entire claim that, prior to the joinder rules would have been brought separately, before it may exercise its discretion under Rule 54(b).
§1292(a): Key Concept
Because injunctive relief requires parties to DO or REFRAIN FROM an act, reversal of an erroneous injunction decision may be impossible if delay is allowed
1292(b): Two key concepts
1. 1292(b) requires the court to certify that the usual reason for finality (efficiency of a single appeal) does not exist
2. It also requires that the Court of Appeals AGREE.
Why didn’t this work in Liberty Mutual v. Wetzel? Because there was no injunction granted.
EXCEPTIONS TO THE FINAL JUDGMENT RULE
1. Collateral Order Doctrine
We read Lauro Lines v. Chasser
Doctrine is weakened by recent cases
2. Injunctions (grant or denial)
Easy exception to finality rule
3. Interlocutory Appeals
More &*%@ rules!!
4. Mandamus
Exceptional relief for the exceptional case
COLLATERAL ORDER DOCTRINE
A three-part test (Cohen v. Beneficial)
• Does the order “conclusively determine the disputed question?”
• Does it resolve an important issue completely separate from the merits of the action?
• Is the issue resolved effectively un-reviewable on appeal from a final judgment?
Lauro Lines v. Chasser
Supreme Court, 1989
NATURE OF THE CASE: This was an appeal of an interlocutory order of a denial to dismiss an action based on a forum selection clause.
FACTS: Chasser (P) and the other plaintiffs were passengers aboard the Achille Lauro when it was hijacked in the Mediterranean Sea by terrorists. P sued Lauro (D) for injuries suffered during the hijacking and for the wrongful death of Leon Klinghoffer. D moved to dismiss P's suit on the ground that a forum-selection clause printed on the passenger tickets limited any passenger to suing in Naples, Italy. The court held that the ticket did not give passengers reasonable notice that they were giving up the right to sue in the United States. D's motion was denied. D then appealed that denial. The court of appeals dismissed D's appeal, finding that the district court's order was interlocutory and not appealable. D appealed to the U.S. Supreme Court.
The defendants have no right to appeal because it’s not final because the case is going on. It is in the nature of an interlocutory appeal under 1292.
Scalia’s concurring opinion:
The reason we say the right not to be sued elsewhere than in Naples is “adequately vindicable”… (even though it is positively destroyed)…is that the right is not sufficiently important to overcome the policies against interlocutory appeals.
INJUNCTIONS
• Statute based [§1292(a)] exception for interlocutory orders granting or denying injunctions.
• Recognizes special and immediate harm that may flow from this extraordinary form of relief.
INTERLOCUTORY APPEALS § 1292
Interlocutory Appeal: When you bring an appeal before a final order. They are permissive only (by leave). Discovery orders, orders denying summary judgment, evidentiary rulings during trial, etc.
Step 1:
An interlocutory appeal can be granted when the district court certifies that the order:
1. “Involves a controlling question of law as to which there is a substantial ground for difference of opinion”; and
2. “An immediate appeal may materially advance the ultimate termination of the litigation.
Benson: That is odd that it puts in the hands of the trial court the decision as to who gets to appeal. If the court says no, you cannot appeal it – there is no certification language.
Step 2:
The Court of Appeals must agree.
23(f) Class Action Appeals. A court of appeals may permit an appeal from an order granting or denying a class-action certification under this rule if a petition for permission to appeal is filed with the circuit clerk within 10 days after the order is entered. You don’t have to get the permission of the trial court. You still have to get the stay however.
WRIT OF MANDAMUS
(Not really an appeal at all) A writ of mandamus is an order to get a public official to do something that the public official is required to do. Vote recounts, re-zoning issues, etc. Can be used against a judge (for a gross mistake) but VERY rare and is disfavored.
We’ve seen these in Civ Pro I:
è Burnham v. Superior Court
è World Wide Volkswagen v. Woodson
An independent proceeding to require a public official to do her job
Duty must be mandatory, not discretionary
A “drastic” remedy reserved for “extraordinary situations” (Kerr v. US District Court, 426 US 394, 402 (1976))
STANDARDS OF REVIEW ON APPEAL
When to take a case to the court of appeals you have to get the court to review it to win.
1. De novo review. We are going to look at this case “fresh.” We are not going to defer to the trial judge and we are going to substitute our judgment for the trial court’s judgment. Reserved for when the appellate court has an equal opportunity to review as much as the trial court did. The most important de novo review is the motion for summary judgment. De novo applies to questions of law.
2. Abuse of discretion review. We will only reverse the trial court if we think the trial court abused its discretion. You have to demonstrate that the discretion was so abusive that there was no discretion at all. Granted for misapplication of law and failure to explain grounds. The law gives trial court tremendous power. Abuse of discretion applies to questions of fact.
3. Clearly erroneous review. Rule 52(a) – Findings of Fact. The difference between de novo review and this review is in a de novo review the court of appeals has the exact same information as the trial court. In this review the court of appeals is working off just the record as opposed to actual people being present so the court of appeals is not going to second guess the factual finding of a trial court unless it’s clearly erroneous.
Determining what the standard of review is makes all the difference in the world.
Anderson v. Bessemer City
Supreme Court, 1985
NATURE OF THE CASE: This was an appeal of a finding of discriminatory intent by a District Court under Title VII of the Civil Rights Act of 1964.
FACTS: Anderson's (P) sued Bessemer City (D) for discrimination under Title VII of the Civil Rights Act of 1964. P alleged that she had been denied a position as Recreation Director because of her sex. After a two-day trial, the court issued a memorandum of decision setting forth its finding that P had been denied the position because of her sex and that male members of D's hiring commission had been biased against P because she was a woman. D appealed and the lower court's findings were reversed because they were clearly erroneous. P appealed.
The Court held that a trial judge’s finding of discriminatory intent was not clearly erroneous, even though it was based on minimal evidence and even though the judge had asked the parties to submit proposed findings of fact that the judge used in the opinion.
Benson: we have appellate courts to correct errors, not to retry cases. Trial courts are not dress rehearsals.
A party need not provide discovery of electronically stored information from sources identified as “not reasonably available”
Must identify withheld information
If requester files a motion to compel, respondent must show undue burden and cost to produce
Court must balance (cost/benefit) need for information against costs of production
It creates a dichotomy of different kinds of electronic information. Things that are reasonably available have to be produced upon request. Things that are not reasonably identifiable – things that you can’t get to without extraordinary measures like erased hard drives or backup tapes from surveillance.
26(b)(5)(B) Inadvertent Disclosure:
Sometimes you produce something that you shouldn’t have and we now have a procedure dealing with that.
• Step 1: Notify party of claim of privilege
• Step 2: Party receiving notice must return, sequester or destroy the material, or
• Alternate Step 2: Deliver the material to the judge for immediate ruling
Other Changes
• Rule 26(f) adds E-discovery issues to the topics to be addressed in the Rule 16 Conference Report
• Rules 33 and 34 are amended to include “electronically stored information” (and distinguish it from “documents”)
• Rule 37 (motion to compel) is amended to create a “safe harbor” from sanctions for parties acting in good faith to protect electronic information
30(b)(6) Depositions
n Deposition notice will describe matters on which testimony is sought
n Corporate defendant must produce witness qualified to testify to those matters
n Excellent strategy early in case:
–To learn what records are kept
–To learn corporate policies and procedures
DISCOVEROPOLY
Benson likes to test on 30(b)(6) Depositions! And let the court decide
DISCLOSURE VS. PRIVACY
Privacy of a nonparty: if someone is not a party, we are going to protect that privacy.
Rule 26. The Power and the Glory
a) Required disclosures
b) Scope and limits
c) Protective orders
d) Timing and sequence
e) Supplementation
f) Conference/Planning
g) Signature
c) Protective Orders:
Upon motion by a party or by the person from whom discovery is sought, accompanied by a certification that the movant has in good faith conferred or attempted to confer with other affected parties in an effort to resolve the dispute without court action, and for good cause shown, the court in which the action is pending or alternatively, on matters relating to a deposition, the court in the district where the deposition is to be taken may make any order which justice requires to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense, including one or more of the following:
(1) that the disclosure or discovery not be had;
(2) that the disclosure or discovery may be had only on specified terms and conditions, including a designation of the time or place;
(3) that the discovery may be had only by a method of discovery other than that selected by the party seeking discovery;
(4) that certain matters not be inquired into, or that the scope of the disclosure or discovery be limited to certain matters;
(5) that discovery be conducted with no one present except persons designated by the court;
(6) that a deposition, after being sealed, be opened only by order of the court;
(7) that a trade secret or other confidential research, development, or commercial information not be revealed or be revealed only in a designated way; and
(8) that the parties simultaneously file specified documents or information enclosed in sealed envelopes to be opened as directed by the court.
If the motion for a protective order is denied in whole or in part, the court may, on such terms and conditions as are just, order that any party or other person provide or permit discovery. The provisions of Rule 37(a)(4) apply to the award of expenses (sanctions) incurred in relation to the motion.
Privacy
Stalnaker v. Kmart
KS, 1996
NATURE OF THE CASE: This was a suit over sexual harassment and a dispute over a protective order that prohibited the plaintiff from deposing certain non-party witnesses.
The court was faced with a sexual harassment claim. Plaintiff sought to depose certain other employees about romantic or sexual conduct with the defendant and others, both voluntary and coerced. The court allowed discovery about conduct with the defendant, but not with others. Although acknowledging that the information was highly personal, the court also concluded that it was very relevant to plaintiff’s case.
The court is not willing to give Kmart the protection they are asking for here but the court does order that the information not be disclosed to anyone that is not involved in the litigation. The court is balancing the interests in order to get people to have some privacy interests while making sure the plaintiff gets what she needs.
Stalnaker Casebook Q’s:
• Would it be appropriate to start the deposition by asking, “Did you ever have a sexual relationship with Mr. Graves”?
– Yeazell: Yes
– Hastings: If I ever catch you starting a deposition with a question like that I will disown you. Ease into the question and find out what they are thinking – ask smaller questions before you get to the big question.
• Is it fair to infer that the witnesses didn’t care about the depositions?
– No, they work for Kmart and can’t afford a lawyer.
• Is the dynamic different if the witnesses themselves are seeking protection under Rule 26(c)?
– Probably
Physical & Mental Exams
Rule 35
On motion of party, a court can order another party to undergo a physical or mental exam
ØPhysical or mental condition must be “in controversy”
ØMovant must show “good cause”
ØApplies only to parties or those in custody or control of parties.
Schlagenhauf v. Holder
Supreme Court, 1964
D3 petitioned for a mental and physical examination of D under Rule 35; the District Court granted the petition and ordered D to submit to nine different examinations. D applied for a writ of mandamus for the mental and physical examinations to be set aside. The Court of Appeals denied mandamus and the Supreme Court granted certiorari because discovery cuts both ways.
Emanuel page 164:
Physical and mental examinations: FR 35 makes it possible to force a party to submit to a physical or mental examination. Unlike all other discovery devices, a party seeking a physical and mental exam must obtain a court order.
1. When available: A physical or mental exam may be ordered only for a party or person in custody or under legal control of a party.
a. Custody or control: The reference to a person under the custody or control refers to a ward, such as an infant or incompetent. The rights of infants and incompetents are usually litigated by guardians.
b. Need not be adverse: The party to be subjected to the examination need not be adverse to the movant; however, it is rarely possible to show good cause for examining a co-party since the requesting party will usually have no need for the information at trial.
2. Court order required: Unless the party to be examined consents, a party seeking a physical exam must obtain an order from the court in which the action is pending. The order is granted only if the party demonstrates that the physical or mental condition is in controversy and if good cause exists for the examination.
a. In controversy: The physical or mental condition of a party is in controversy if the condition is relevant to one or more claims or defenses before the court and if there is a genuine dispute concerning the condition.
i. Relevancy: Example: If defendant was insane at the time of signing a contract, the mental condition will be in controversy.
ii. Placing condition in controversy: Because of the highly intrusive nature of exams, the Supreme Court limited the ways in which a person’s physical or mental condition could be placed in controversy.
(a) A party may place his or her own condition in controversy in the pleadings by alleging a claim or defense that turns on that condition.
(b) However, a party may not place the condition of another party in controversy in the pleadings. Instead, the party needs to offer an affidavit or other affirmative evidence tending to show that the person’s condition is in controversy.
Example: Submit an affidavit of a person or witness who knows that the defendant’s eyesight is bad.
Hastings: The person has to be a party
Casebook Questions
• How does the Court deal with:
– The “in controversy” requirement?
• Doesn’t really discuss it but feels Contract Carrier has not met its burden
– The “good cause” requirement?
• Court is critical of materials submitted to meet standard
• Writs of mandamus are rarely granted. Why do you suppose this one made it to the Supreme Court?
– The district court’s work was slipshod—it held no hearing and granted more relief than was requested.
WORK PRODUCT DOCTRINE
RULE 26(b)(3)
• Common Law Fountainhead and Leading Case:
– Hickman v. Taylor
• Current codification:
– Rule 26(b)(3): Trial Preparation Materials
26(b)(3) protects trial preparation materials – it protects stuff, not facts, i.e. witness statements. No fact in a case is protected by the work product doctrine. Things that are created in anticipation of litigation are protected and are immune from disclosure in litigation unless you can pass a two-part test:
1. Substantial need for the information that’s covered in the work product materials; and
2. Inability to obtain by other means without great hardship
Exception: Party or nonparty may obtain his or her own statement. If you’ve taken a written statement from someone, a witness is entitled to get that statement.
Hickman v. Taylor
Supreme Court, 1947
NATURE OF THE CASE: This was an appeal from a judgment of civil contempt for the failure to produce work product pursuant to a discovery request.
FACTS: Five crew members of a tugboat drowned when it sank. The cause of the accident was unknown. A public hearing was held at which the four survivors were examined. Their testimony was recorded and was made available to all interested parties. Taylor (D), the tugboat owner hired an attorney (Fortenbaugh) to defend against potential suits by representatives of the deceased crew-members. In anticipation of litigation, the attorney interviewed the survivors and other persons whom he believed to have information about the accident. Representatives from all five deceased crew-members eventually brought claims. Four settled out of court, but the fifth brought suit in federal court under the Jones Act. Hickman (P) represented one of the deceased and brought this motion to obtain copies of the statements D's attorney obtained from the survivors. P filed interrogatories asking for any statements taken from crew members, and any oral or written statements, records, reports, or other memoranda made concerning any matter relative to the towing operation, the tug's sinking, the salvaging and repair of the tug, and the deaths of the deceased. D refused P's request under the attorney-client privilege. The District Court disagreed, not finding a privilege. It ordered D and his attorney to produce the material. They refused and were held in contempt. They appealed. The Court of Appeals reversed. P then petitioned the Supreme Court for review.
Jackson’s concurrence: “Discovery was hardly intended to enable a learned profession to perform its functions either without wits or on wits borrowed from the adversary.”
We are going to gather information on our own and not try and figure out what’s in the other lawyer’s head.
LEGAL ANALYSIS: The attorney had to get himself thrown in jail to win. Federal Rule 26(b)(3) was added because of this case. Federal Rule 26(b)(3) deals with the discovery of work product. It states that documents prepared in anticipation of litigation are discoverable only upon a showing that the party seeking such material has substantial need of them, and that he is unable without undue hardship to obtain the substantial equivalent of the materials by other means. Mental impressions, conclusions, opinions, or legal theories of attorney or other representatives of a party are to be protected against disclosure. Lawyers can waive this Rule, but their clients can't.
Hickman: Casebook Q’s
• What is the information sought?
– Written statements; information from oral interviews
• Is it relevant?
– Sure
• Is it privileged?
– No
So what’s the beef? We want to protect attorney mental impressions.
Rule 26(b)(3): Trial preparation and work product materials are protected from discovery and need not be produced EXCEPT when the information contained in such materials is not reasonably available from any other source.
Ø Applies to documents and tangible things prepared in anticipation of litigation.
Ø Doctrine applies only to parties and their agents.
Ø Broader than attorney/client privilege
To avoid application of the doctrine, a party must show:
Ø That there is no reasonable alternative source for the same or substantially equivalent information; and
Ø That the party has a substantial need for the information.
Ø Note:
§ Attorney’s mental impressions and legal evaluations receive a higher level of protection.
§ Party and witness statements are discoverable by person making the statement.
ØWaiver: Can’t disclose protected document to another
Casebook Hypos:
P is hit by B Company’s bus. B, a VP, comes to investigate.
• B makes a report to the Board. Discoverable?
– Probably—it doesn’t appear to be part of a claims investigation
• B makes a report to the claims department. Discoverable?
– Probably
• B makes the report to the attorney head of the claims department because the department head is fearful of suit. Discoverable?
– Probably not!
• Attorney for B Corp invests $10,000 in an investigation and discovers a new witness. May B Corp avoid disclosure of the witness based on work product?
– Never! Work product does not protect facts!
Boris’ Saga
• Boris is injured in an auto accident. Defendant’s insurer visits him in the hospital and takes a statement
• Can you get a copy?
– Yes
• Can you get it before Boris’ deposition?
– Probably not
• If there is no written statement can you get the contents of the statement?
– No
• Boris’ friend Frank gave a statement. Can Boris get it? How?
– Frank has to ask for it. Boris can get it from Frank.
Fortenbaugh Revisited
• What if the survivors died after Fortenbaugh interviewed them?
– Sounds like plaintiff could meet the burden
• What if the survivors forgot everything they told Fortenbaugh by the time Plaintiff interviews them?
– Plaintiff will have an uphill battle: The courts are reluctant to a lawyer’s lack of initiative
Major Points and Black Letter Law
FR 26(b)(3)
Exception to broad scope of discovery
Largely codifies Hickman v. Taylor
Protects:
Trial preparation materials
Not facts
“Conditional” privilege:
Overcome by showing of need
EXPERT DISCOVERY
RULE 26(b)(4)
Same as Work Product
Additional Discovery under Rule 26(b)(4)
Once you’ve done your 26(a)(2) disclosures and you’ve given the identity of your testifying experts and expert report, you have to give your testifying expert for a deposition. The deposition is not until after the 26(a)(2) disclosures.
Non-testifying experts only have to be subjected to discovery if they are also fact witnesses unless you can make the showing of exceptional circumstances just like the exceptional circumstances in Hickman v. Taylor. Like the work product rule, I am allowed to go out and talk to as many expert witnesses as I want to – not fact witnesses, but experts in the field.
• (A) Depositions of testifying experts
• (B) Discovery of non-testifying experts if they are fact witnesses (i.e. treating physician) under Rule 35(b); otherwise under a showing of “exceptional circumstances”
• (C) Costs of discovery to be borne by the party requesting it
Casebook Hypos (p. 447)
• Johnna is injured. Dr. Kildare is his treating physician.
• Dr Welby is Johnna’s expert witness, hired by John’s lawyer.
• Both doctors will testify at trial
• What information will have to be provided in the mandatory Rule 26(a)(2) disclosures
– About Dr Kildare?
• Nothing
– About Dr. Welby?
• Identity and conforming report
• Where will Dr Kildare be disclosed?
– In the Rule 26(a)(1) disclosures
• Must Johnna’s lawyer disclose Welby if he is not going to testify?
– No
• May Johnna depose Welby if he is not going to testify?
– Not unless she can show that there is no other expert who can provide the information she needs.
Thompson v. Haskell
FL, 1994
Thompson (P) sued Haskell (D) and her supervisor for sexual harassment. Dr. Lucas was retained by prior counsel to conduct a diagnostic review and personality profile on P. P alleged that because of sexual harassment by a supervisor employed by D, P was reduced to a severely depressed emotional state. P was terminated by D on June 5, 1992. P was then examined by Dr. Lucas on June 15, 1992. A report was prepared. D sought discovery of the report. D contends that the examination by Dr. Lucas is highly probative with regard to the allegations of the suit and that allegation is essential to P's case. P filed a motion for a protective order from discovery. P contends that Ruled 26(b)(3) and (4) protect a psychological report from discovery.
Circumstances exist which allow to pierce the non-testifying privilege. How does the Defendant meet the burden of showing exceptional circumstances? The information is not available from any other source.
HOLDING AND DECISION: (Snyder, J.) Is the report of a non-testifying psychologist discoverable under exceptional circumstances? Yes. Rule 26(b)(4)(B) provides that opinions and facts held by a non-testifying expert who had been retained by the opposing party in anticipation of litigation cannot be discovered except as provided under Rule 35 or if there is a showing of exceptional circumstances where it is shown that it is impracticable for the party seeking discover to obtain the same facts or opinions by other means.
Hastings: What if Thompson had already filed suit when Lucas examined her?
Different result?: Defendant knew of need to examine
Chiquita Int’l v. M/V Bolero Reefer
NY, 1994
NATURE OF THE CASE: This was a dispute about the application and classification of the status of a witness under Rule 26(b)(4)(B).
FACTS: This was a maritime action for the loss and damage to cargo. Chiquita (P) contracted International Refer to transport approximately 155,000 boxes of bananas aboard the M/V Bolero Reefer (D) to Germany. Because of malfunctions with the vessel's loading cranes only about 112,000 boxes were load and 43,000 were left on the wharf and were thrown away. The cargo that arrived in Germany was delivered in poor condition. Winer was employed by P as a maritime surveyor and examined the vessel when it arrived. After the inspection, P sued D. International Reefer sought the production of Winer's files and to depose him and P objected under 26(b)(4)(B). D claims that Winer is not an expert but a witness and even if he was an expert discovery is warranted because he was the only surveyor who inspected the vessel shortly after it arrived in Germany.
This case is similar to Thompson but we get the opposite result because of lack of diligence. It was their boat, why didn’t they look at the cranes? The other expert did, why didn’t you do your own investigation? The court is not going to allow the rule to be pierced or breached.
• “This argument would have merit if International Reefer had been precluded from sending its own expert to the scene by forces beyond its control…”
• “The failure of International Reefer to engage its own marine surveyor in a timely manner should not be rewarded…”
Hastings: What if the banana boat sank right after Winer examined it?
Different result? Defendant had less access but it is still Defendant’s boat!
Big Pieces: Expert Discovery
Ø Testifying Experts: Subject to automatic disclosure provisions of 26(a)(2), and can be deposed pre-trial (but after submission of report) per 26(b)(4)(A).
Ø Non-Testifying Experts: Protected from discovery, UNLESS
§ Expert is a treating or examining health professional [Rule 35(b)]
§ Party could not obtain facts or opinions on the same subject matter by any other means.
SANCTIONS
Rule 26(g)
(g) Signing of Disclosures, Discovery Requests, Responses, and Objections.
(1) Every disclosure made pursuant to subdivision (a)(1) or subdivision (a)(3) shall be signed by at least one attorney of record in the attorney's individual name, whose address shall be stated. An unrepresented party shall sign the disclosure and state the party's address. The signature of the attorney or party constitutes a certification that to the best of the signer's knowledge, information, and belief, formed after a reasonable inquiry, the disclosure is complete and correct as of the time it is made.
This sounds a lot like Rule 11, but Rule 11 does not apply to discovery because Rule 26 does.
(2) Every discovery request, response, or objection made by a party represented by an attorney shall be signed by at least one attorney of record in the attorney's individual name, whose address shall be stated. An unrepresented party shall sign the request, response, or objection and state the party's address. The signature of the attorney or party constitutes a certification that to the best of the signer's knowledge, information, and belief, formed after a reasonable inquiry, the request, response, or objection is:
(A) consistent with these rules and warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law;
(B) not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation; and
(C) not unreasonable or unduly burdensome or expensive, given the needs of the case, the discovery already had in the case, the amount in controversy, and the importance of the issues at stake in the litigation.
If a request, response, or objection is not signed, it shall be stricken unless it is signed promptly after the omission is called to the attention of the party making the request, response, or objection, and a party shall not be obligated to take any action with respect to it until it is signed.
(3) If without substantial justification a certification is made in violation of the rule, the court, upon motion or upon its own initiative, shall impose upon the person who made the certification, the party on whose behalf the disclosure, request, response, or objection is made, or both, an appropriate sanction, which may include an order to pay the amount of the reasonable expenses incurred because of the violation, including a reasonable attorney's fee.
This is what you are certifying when you sign your discovery request much like Rule 11. Sanction for violating this rule can be imposed on the attorney, the client, or both. The court has wide discretion in determining which sanctions are appropriate and those sanctions are found in Rule 37(b).
Typically they include expenses incurred by the opponent including reasonable attorneys fees (the most common sanction). As a practical matter 26(g) isn’t invoked all that often. The reason is that Rule 26(g) isn’t all that helpful to lawyers – all it does is provide for sanctions. Lawyers rely on Rule 37 – it provides for sanctions but more importantly it provides a mechanism so you can get the information/documents you seek. The reason you are filing this motions with the court is not so much to punish your opponent but to get information. Typically what you are filing is a motion to compel the discovery and in addition, judge, will you sanction this person for forcing me to bring this motion.
Rule 37. Failure to Make or Cooperate in Discovery; Sanctions – The workhorse of the discovery motions.
The focus of Rule 37 is getting the information and not just sanctioning the attorney for failure to provide. If an opposing party fails to make full disclosure or fails to respond to a discovery request, you make this motion seeking an order compelling discovery under Rule 37(a).
If your opponent objects to your discovery, it is under this rule that you bring the motion. Remember: not all discovery disputes are in bad faith. Sometimes there are legitimate arguments over relevancy, work product, privilege, etc., but you still use 37(a) to get the matter before the court.
You can file this motion if your opponent fails to make automatic disclosures required by 26(a) or fails to respond to discovery served pursuant to the discovery rules i.e. interrogatories, requests to admit, request to produce, etc. Importantly the motion must be accompanied by an affidavit by the moving party stating: that the moving party tried in good faith to contact the opponent, to meet, confer and resolve discovery disputes. In other words, “your honor this was a last desperate act to get my opponent to provide the discovery that I so richly deserve.”
The consequences of failing to attach the affidavit:
If I file a motion under 37(a) to compel you, and I don’t attach an affidavit (stating in good faith I tried to contact opposing counsel, etc.), the court will not grant sanctions (expenses and attorneys fees) but I still get the documents.
The current practice now requires that before a plaintiff files a motion to compel, the plaintiff must make a good faith effort to contact defendant. If the good faith effort is not made, no monetary sanctions will be granted. Under Rule 26(g) there is no requirement to meet and confer because the damage has been done (mislead the court, opponent lied, etc.) Under rule 37 you are still trying to get the information.
37(a)(4)(A) Expenses and Sanctions:
If the motion is granted or if the disclosure or requested discovery is provided after the motion was filed, the court shall, after affording an opportunity to be heard, require the party or deponent whose conduct necessitated the motion or the party or attorney advising such conduct or both of them to pay to the moving party the reasonable expenses incurred in making the motion, including attorney's fees, unless the court finds that the motion was filed without the movant's first making a good faith effort to obtain the disclosure or discovery without court action, or that the opposing party's nondisclosure, response, or objection was substantially justified, or that other circumstances make an award of expenses unjust.
What happens occasionally is you file your motion to compel and the court orders the material to be produced but your opponent still doesn’t comply. Look to 37(b): Failure to comply with an order. Now you are in serious trouble – the failure may be considered a contempt of that court and may result in the following:
1. The document may be excluded even if it helps your opponent as in evidence of damages, which will cause you to lose your case;
2. Order that all of your affirmative defenses be stricken – SOL, immunity, etc;
3. Issue a stay until the order is obeyed; and
4. The Death Penalty – the court may dismiss the action if it is the plaintiff or enter a default if it is the defendant who is in contempt. For that to take place the case law indicates that there must a pattern of failing to abide by the court’s orders.
Problems Page 453
Breach of Contract Case:
1. (a) Baxter refuses to answer. What to do?
Step 1: Good faith effort to confer/resolve
Step 2: Motion to compel under 37(a)(2)
(b) Are sanctions available?
Yes, 37(a)(4)
2. The CEO does not show up for deposition. What to do?
Step 1: Attempt to confer and resolve
Step 2: Motion under Rule 37(d) – Failure of Party to Attend at Own Deposition or Serve Answers to Interrogatories or Respond to Request for Inspection.
3. Can Arthur defend the Rule 37(d) motion by claiming the deposition was intentionally set to be burdensome? No, it failed to make a motion (protective order) under 26(c)(2)—See 37(d) (last sentence)—but it will likely mitigate sanctions.
4. This time the witness shows up for her deposition but the lawyer is obstreperous and after 7 hours the deposition is not over. As attorney for Baxter Corp, what to do? Move for more time under Rule 30(d)(2).
5. Baxter is uncooperative: Foot dragging, underproduction, overproduction with relevant documents buried. What to do?
Step 1: Good faith attempt to meet and confer
Step 2: Move to compel/Cite 37(a)(3)
6. Baxter’s lawyer wants $10,000 worth of depositions to explore a $5000 counterclaim. What to do?
Make a motion to limit discovery under Rule 26(b)(2)(iii): The burden or expense of the proposed discovery outweighs its likely benefit, taking into account the needs of the case, the amount in controversy, the parties' resources, the importance of the issues at stake in the litigation, and the importance of the proposed discovery in resolving the issues. The court may act upon its own initiative after reasonable notice or pursuant to a motion under Rule 26(c).
Thompson v. Department of Housing & Urban Development
MD, 2001
NATURE OF THE CASE: This was a dispute over a discovery request and a motion before the court to compel discovery.
FACTS: Thompson (P) is a class representative of African Americans residents of Baltimore public housing developments. P filed suit in 1995 against HUD (D) and others alleging that Ds and their predecessors from 1933 to present have established and perpetuated de jure racial segregation in Baltimore's public housing. Ps have filed a motion to compel Ds to provide responsive answers to Rule 33 and Rule 34 discovery requests.
The plaintiffs are looking for systemic patterns of discrimination going back many years.
The point of this case: Discovery is and has been self executing. The courts traditionally do not get involved in discovery unless a dispute arises. So, when a lawsuit is filed and the complaint is answered, the parties on their own begin to exchange interrogatories, do depositions and everything goes swimmingly. The judge doesn’t even know about your case until trial.
With the new amendments the court gets more involved with discovery and unchecked discovery disputes and people being driven into bankruptcy over discovery. This magistrate says, I recognize that were supposed to get more involved, but not this involved. The law says you have to make a good faith effort to meet and confer and you guys didn’t really do that.
The Rule 26(b)(2) Balancing Factors:
Is the discovery unduly cumulative or duplicative, or available elsewhere at lower cost?
Has the party seeking discovery had ample opportunity to obtain the information?
Does the burden or expense of the discovery outweigh its likely benefit, taking into account the parties’ resources and the amount in dispute?
The court held that the request was too broad. Instead, the plaintiffs and defendants were required to meet in a discovery conference, in which plaintiffs would be required to show how the particular information sought might relate to their actual claims and how the benefit of the information would outweigh the burden imposed on defendant.
Poole v. Textron
MD, 2000
NATURE OF THE CASE: Poole (P) requested attorneys' fees and sanctions against Textron (D) for discovery misconduct, and after ruling on the merits, the court determined whether an award of expenses including attorneys' fees or other sanction was justified under the governing rules and case law and, if so, the amount of expenses or sanction.
FACTS: This is a product liability case in which P sued D for alleged defects in a golf car, which resulted in serious injuries to him. The trial judge referred all discovery disputes to this Magistrate.
The court held that sanctions should be imposed on the defendant for failing to respond adequately to plaintiff’s discovery request. It explicitly found that defendant was not justified in objecting to plaintiff’s request, refusing to search its records, and failing to turn over documents and information to plaintiff.
One of the problems with discovery is that it overwhelming favors the party with dominant resources especially in personal injury cases where the attorney and the injured party oftentimes have very little resources in contrast to a large corporation.
This judge raises some important points:
1. Sanctions means punishment. It’s not designed to compensate the wronged party. Instead it’s a penalty to correct and deter bad behavior.
2. The court came down hard in this case (and not in Thompson) as a matter of style. Some judges are harsher than others.
3. The dispute arose early in the case and months went by before they finally complied.
DISCOVERY TOOLS
The most common discovery took is the deposition, request to produce, interrogatories and request to admit. You need to know how to use them in conjunction with one another. As long as you know what you have to prove to win this case or get it to a jury and what information can I get from this guy that’s going to support this claim. What information can I get from this witness that might contradict my claim? What information can I get that supports his defenses? You must always have in your mind exactly what your cause of action is. What is your theory of defense? What is your theory of liability? What do you have to prove? As long as you understand that thoroughly, the questions will come naturally.
Hypo 1: The plaintiff filed a lawsuit against her former employer alleging sex discrimination and sexual harassment. In the compliant she alleged emotional distress. The employer sent interrogatories and later wanted medical records. The plaintiff refused based on doctor-patient privilege. The defense says that plaintiff put her mental state at issue, therefore waiving the privilege.
The court held that plaintiff’s allegation was “garden variety” and that meant that she was suing for the same kind of stress that any person would feel of they were sexually harassed – not arguing that she suffered a mental disorder and relying on expert psychiatric testimony. The court said that she didn’t waive the privilege; however, at trial she will not be allowed to argue anything but “garden variety” humiliation and embarrassment because she didn’t produce any discovery to that effect.
Hypo 2: Plaintiff sues a railroad company and asks for a whole bunch of documents. The railroad doesn’t respond within the 30 day timeframe and it is only after plaintiff tries to meet and confer do they allege that the documents are privileged.
Rule 26(b)(5) Claims of Privilege or Protection of Trial Preparation Materials.
(A) Information Withheld.
When a party withholds information otherwise discoverable under these rules by claiming that it is privileged or subject to protection as trial-preparation material, the party shall make the claim expressly and shall describe the nature of the documents, communications, or things not produced or disclosed in a manner that, without revealing information itself privileged or protected, will enable other parties to assess the applicability of the privilege or protection.
Benson: Even if these documents are privileged, they’ve waived the privilege by failing to comply with the court rule. The argument in response is, yeah we screwed up but we didn’t waive the privilege because there isn’t anything in Rule 26 about waiving privilege. The court held that boilerplate objections or blanket refusals inserted in a response to Rule 34 (request to produce documents) are insufficient to assert a privilege. It’s not automatically waived.
Hypo 3: Gary Condit, “I’m not a perfect man” sued Dominick Dunn. Dunn accused Condit of a crime of moral in turpitude and that is considered slander per se and failure to obtain gainful employment. In his deposition he refused to answer:
1. Questions about any sexual relations. Condit did admit to the police that he had an affair with Chandra Levy and that could be used as impeachment.
2. Questions concerning his financial status. Financial information is discoverable because you can’t analyze a discovery question unless you know exactly what theory of liability is being argued, what the defenses are and whether this information sought is going to be relevant to those defenses. How do we know that he’s unemployed because of Dunn’s comments? He’s so wealthy he doesn’t need a job.
DEFINITIONS
Inference: A logical deduction. It’s what juries do everyday – infer from the evidence you’re your client is entitled to relief. Inferences are always optional. That’s what closing arguments are all about. Inferences are always optional – the jury can always reject.
Scott Peterson Example: No direct evidence (witnesses, fingerprints, DNA, etc.) but a classic circumstantial case (wife disappears, having an affair, suspicious comments, fishing, etc.) If you believe A, B, & C as true, we want you to infer from that he is responsible for Laci’s murder.
Car Accident Example: Two cars crashing on a rural road. Accident reconstruction experts will measure skid marks, look at the damage to the vehicles, etc, and from all of that they will infer which one of the drivers crossed the center line and a lawsuit may result from that.
Closing argument in Houchens case: If you believe that he hasn’t sent any letters, or contacted anyone in seven years, or made a credit card transaction – if you believe all that I want you to infer that he is dead.
Burden of Proof: Two separate concepts:
1. Burden of persuasion (risk of non-persuasion): Who has the burden of convincing the fact finder of any particular proposition? The burden rests with the person who wants to disrupt the status quo (almost always the plaintiff). Equipoise: If all things are balanced (50/50), it doesn’t disrupt the status quo. The concept of disrupting the status quo carries throughout the litigation. The general rule: The burden of persuasion never shifts to the other person.
2. Burden of production. Who has the burden of producing evidence of a particular proposition? The burden of production however, shifts back and forth during trial and during a motion for summary judgment. If you do not want to produce documents, the burden then shifts to you to seek a protective order.
All relevant evidence is admissible unless there is a rule that says it isn’t. If it’s hearsay, the burden of proof shifts back and forth.
Presumption: Think of presumption as a mandatory inference. A presumption is not optional. If you believe A, B, & C, then you must find or infer for the person providing the evidence.
Mailbox Rule Example: If I drop a properly stamped and addressed letter in a mailbox, it is presumed that it was delivered. The mail goes where the mail is addressed. The reality is if you mail that letter, they almost always get it. If you can establish to the jury that you properly addressed and stamped the envelope and you put it in an authorized mailbox, we will instruct the jury that they must infer that the person received the letter.
Closing argument in Houchens case with the statute: It is presumed that after seven years he is dead; therefore, you must infer that he is dead. If the insurance company cannot produce evidence to the contrary, they will lose as a matter of law.
RULE 56
Rules 12(b)(6), 12(c) and Rule 56
• Rule 12(b)(6) or 12(c): “Facial attack”--challenges the claim or defense shown on the “face of the pleading.”
• Rule 56: “Pierces the pleading”—challenges the factual basis of claims and defenses
The difference between 12(b)(6) and 56 is 12(b)(6) is based on the pleadings and 56 is based on facts. For a 12(b)(6) motion the judge looks only at the complaint or the answer (if it fails to recognize a valid defense), and the judge doesn’t look beyond the pleadings. If the court finds as a matter of law that the pleadings are insufficient, the judge dismisses that case. If the judge finds himself looking at evidence outside the pleadings, you are deciding the case under Rule 56 – it is designed to test the facts.
Inmate Medical Malpractice Example: A doctor performs a procedure on an inmate under unsanitary conditions and the inmate gets infected. To sue the government in a civil rights violation (government doctor, government institution), you cannot sue for ordinary malpractice – they are immune from that. If you sue for civil rights, you have to allege a constitutional violation. The government cannot impose cruel and unusual punishment (Eighth Amendment). You have to show extreme indifference to your serious medical needs. State v. Gamble
Under Rule 12(b)(6):
You draft a malpractice complaint. In lieu of an answer, the government files a 12(b)(6) motion. Is it going to be granted? Yes, the law requires more (constitutional violation). If you add different causes of action, you have stated a claim and a 12(b)(6) motion will be denied.
Under Rule 56:
Based upon the facts of the case, it will be dismissed under Rule 56 – there is no evidence that could possibly support a claim for extreme indifference to medical needs.
Rule 56 makes reference to a genuine issue of material fact. That means that if there is evidence before the court that a reasonable jury could find in favor of the person producing the evidence, then there is a genuine issue of material fact.
Example: During a motion for summary judgment, if the non-moving party (the party against whom the motion has been filed) can produce sufficient evidence that a reasonable jury could find in the non-moving party’s favor, then there is a general issue of material fact.
Keep in mind:
1. It must be based on admissible evidence, i.e. the evidence produced has to be evidence that the court is reasonably sure is actually going to be admitted.
Example: An affidavit is not admissible in court typically because it’s hearsay. It’s an out of court statement. You can’t use an affidavit; the person has to testify live under oath and subject to cross-examination. The person does not have to testify live at a Rule 56 hearing – the affidavit is sufficient. What an affidavit says in effect is: when called upon this is what I am going to say. The evidence has to be admissible but it doesn’t have to be in the form of admissibility at the time of the hearing.
2. In deciding the motion, the judge may not weigh the credibility of the evidence. If believed, can a reasonable jury find in this party’s favor? That’s all the judge asks.
Example: If called upon I am going to testify to the following: ______. The judge may not look at the affidavit and say that he does not believe the testimony, therefore rule against it. The judge cannot judge the credibility of the evidence (that’s for the jury), he can only determine whether the evidence is sufficient.
In order to point to the court what the genuine issue is, you draw upon discovery, i.e. interrogatory answers, deposition transcripts, documents produced, etc. That is what is going to be produced during trial; thus, there is or isn’t a general issue of material fact.
Anatomy of Rule 56
• (a) For Claimant: A claimant may move for Summary Judgment
– 20 days from commencement of action,
– “With or without” affidavits,
– As to “all or any part” of the claim
• (b) For Defending party: A defendant may move for Summary Judgment:
– At any time,
– “With or without” affidavits,
– As to “all or any part” of the claim
• (c) Motion and Proceedings:
– Motion served at least 10 days before hearing
– Adverse party may serve opposing affidavits prior to hearing
– Judgment may be rendered on the basis of:
• Pleadings
• Depositions
• Interrogatory answers
– Must be “no genuine issue as to any material fact”
• (d) Case Not Fully Adjudicated on Motion:
– The court need not resolve the entire case
– May resolve some fact issues and not others
– May resolve some portions of the case and not others
– Court issues order specifying what has been resolved and what remains in controversy
• (e) Form of Affidavits; Further Testimony; Defense required
– Affidavits must:
• be based on personal knowledge;
• set forth facts that would be admissible into evidence
• Show affirmatively that the affiant is competent to testify
• Documents must be authenticated by affidavit and attached thereto (this rule is often honored in the breach)
• (e) Form of Affidavits; Further Testimony; Defense required
“The court may permit affidavits to be supplemented or opposed by depositions, answers to interrogatories or further affidavits.”
• (e) Form of Affidavits; Further Testimony; Defense required
“When a motion for summary judgment is properly made and supported:
• The adverse party may NOT rest upon allegations or denials
• The adverse party must respond with affidavits or otherwise, identifying specific facts showing a genuine issue for trial.
• (f) When Affidavits are Unavailable
– If the affidavits of a party opposing summary judgment show that the party cannot for valid reasons present facts necessary to defend the motion, the court may:
• Deny the motion, or
• Order a continuance to allow additional time or discovery, or
• Make such other order “as is just”
• (6) Affidavits Made in Bad Faith
– If the affidavits of a party are imposed
• In bad faith, or
• Solely for purposes of delay
The court:
• Shall order the party employing them to pay reasonable expenses and fees, and
• May adjudge the offending party or attorney guilty of contempt.
Example Affidavit:
Affidavit of Publius Porker
I, Publius Porker, being first duly sworn, hereby testify as follows:
I have personal knowledge of the matters contained in this affidavit and am competent to provide testimony as to these matters.
The documents attached hereto as exhibits A-D are true and accurate copies of records kept in the ordinary course of business at Porker Enterprises.
On March 15, 2006, the Plaintiff agreed to work late. I left the office at the regular time and went home to honor my wife on the occasion of our Anniversary. I never laid a hand on plaintiff.
Publius Porker
(notary)
SUMMARY JUDGMENT
The purpose of summary judgment is to isolate and terminate claims and defenses that are factually unsupportable before trial so you don’t waste judicial resources trying cases over which the person does not have sufficient facts to support the claim. Defendant has the initial responsibility, or burden, of demonstrating to the court the absence of a genuine issue of fact.
Celotex Corp. v. Catrett
Supreme Court, 1986
FACTS: Catrett (P) sued several asbestos manufacturers, claiming that the death of her husband resulted from exposure to their products. P's suit was in negligence, breach of warranty, and strict liability. Celotex (D) moved for summary judgment; no evidence existed that the decedent had been exposed to D's products. P produced three documents which she claimed demonstrates that a genuine factual dispute exists. D argued that the documents were inadmissible hearsay. The district court granted the motion for summary judgment; there was no showing that P's husband had been exposed to D's products. The court of appeals reversed; D had not offered sufficient evidence to rebut P's allegations in the form of affidavits or otherwise. The Supreme Court granted certiorari.
ISSUE: If information derived through discovery indicates that the non-moving party (here P) cannot prove an essential element of her cause of action at trial, must the moving party (here D) still come forward with evidence in the form of affidavits or other information to show the absence of a genuine issue of material fact within the meaning of Rule 56(c)?
No. The court held that the defendant need not offer proof that negates plaintiff’s case. It need only show that plaintiff has failed to meet the burden of production. (On the other hand, if defendant does have affirmative evidence that negates an element of plaintiff’s claim, it is free to introduce it.)
However, defendant cannot simply assert that plaintiff has no evidence. Instead, it must point out to the court those parts of the depositions, affidavits, and other evidence that demonstrate that plaintiff has no evidence on one or more elements of its claim.
Thus according to the Celotex standard there are two ways for a movant to prevail in summary judgment (supposing the respondent has no counter argument). One way is to offer evidence to negate one of the elements of the claim. The second is to show that plaintiff has no evidence to support the claim.
Benson: Whoever has the burden at trial is going to be required to produce admissible evidence at the Rule 56 hearing to show that there is a genuine issue of material fact.
While this case has been interpreted as shifting the burden of proof for summary judgment from the movant to the respondent (thereby over ruling Adickes v. S.H. Kress Co. 1970), the movant still must "show" the respondent does not have enough evidence to make out a prima facie case (for example by pointing out specific discovery responses where the respondent admits a lack of evidence).
Motion for partial summary judgment: Asking the court dismiss some of the counts if there is not enough evidence to support them; thus narrowing the issues.
4(a): The expert’s affidavit is sufficient to move the proposition into the realm where reasonable minds can differ
4(b): Causation is a material fact and she has to prove it and it’s going to be a genuine issue of material fact and that is more for a judge to decide. In a motion filed per Rule 56, the judge decides. If he or she decides there is no genuine issue of material fact, then there is nothing to submit to a jury. If the judge decides that there is a genuine issue of material fact, then the case goes to trial and the jury decides the issue.
5(a): Only if attached to an affidavit sufficient to establish that it is admissible into evidence.
5(b): At best this might justify some additional time for plaintiff to peruse Defendant’s records. See FRCivP 56(f)
The affidavit requires that it be made on personal knowledge.
5(c): NO!! The affidavit establishes only that it’s maker has no personal knowledge!
Bias v. Advantage International, Inc.
DC, 1990
This case illustrates how a defendant shows the absence of facts necessary to support plaintiff’s claim. The plaintiff in this case was the estate of a college basketball star. The decedent dies two days after being selected in the first round of the NBA draft. The estate claimed that defendant, decedent’s agent, had breached its promise to procure life insurance covering decedent. Defendant admitted that it had breached this promise but countered by asserting that decedent’s drug use would have made it impossible to procure a policy (an affirmative defense). Defendant supported this allegation with evidence showing that decedent used drugs regularly and that no life insurance company would issue a policy to a drug user. The court held that this evidence was enough to demonstrate no genuine issue of material fact. Moreover, because plaintiff had no real evidence suggesting the contrary, summary judgment for defendant was appropriate.
ISSUE: Was there a triable issue of fact as to whether Bias was a drug user?
Affirmative defense: We concede that everything you say is true; however, we are still not liable.
Houchens v. American Home Assurance Co.
4th Circuit, 1991
NATURE OF THE CASE: This was an appeal of dismissal of an action for damages for a breach of contract on two insurance policies.
FACTS: Houchens' (P) husband disappeared after arrival in Thailand in August 15, 1980, and was not heard from since. A number of agencies searched for the husband including the FBI, ICAO, the Red Cross, and the State Department. Under Virginia law, a person who is missing for seven years is presumed dead. On April 29, 1988, P had her husband declared legally dead. P attempted to collect on two life insurance policies issued by American (D). Both were accidental death policies. The proceeds of those policies were to be paid upon proof that P's death was accidental. D refused to pay and P sued in federal court for breach of contract. D moved for summary judgment; there was no evidence that the insured had died or that he had died accidentally. D's motion was granted and P appealed.
ISSUE: Did the district court err in granting summary judgment in favor of D?
No. Neither party had any direct evidence on the crucial issue of whether a person’s death was accidental. Because the plaintiff had the burden of proving that the death was accidental, the court held that summary judgment for defendant was appropriate because she could not prove that her husband died an accidental death.
RULE 56
According to Celotex, a party files a motion for summary judgment under Rule 56. Whenever a motion for summary judgment is filed, whoever has the burden at trial has the burden at the Rule 56 motion. If the defendant files the motion, the defendant’s initial burden is simply to identify to the court what part of the plaintiff’s case that the defendant believes the plaintiff does not have sufficient evidence to prevail on.
RULE 16
Provides an opportunity for the court to organize and call on a pretrial conference. A pretrial conference gives the parties an opportunity to introduce themselves, introduce the facts of the case, and sort out any problems from the Rule 26 meet and confer.
The court produces a scheduling order which basically states that discovery is going to end on such and such date. The court will address issues of Joinder and any objections therein. The judge may give informal opinions as to the merits of certain claims or defenses, address discovery issues and the court is always exploring settlement. A settled file is a closed file and judges love closed files (more time to golf).
16(d). Final Pretrial Conference, Order
The final pretrial conference is usually held after discovery and usually fairly close to the trial date, but after any Rule 56 hearings. It is an extremely important conference which typically is a settlement conference. Although the language of the rule doesn’t specifically say it, the case law is clear that the court can order parties to attend.
Trial date is set as well as dates for any remaining motions (except for Rule 56). The local rule usually requires the parties to meet and confer and produce a joint pretrial statement. The pretrial statement has to state both sides and all of the parties’ legal theories and defenses. It will require the parties to provide a list of witnesses and documents that will be presented at trial. It also requires to parties to anticipate and inform the court what legal or evidentiary problems the parties anticipate (what’s likely to arise at trial).
The court takes the pretrial statement and reduces it to an order. The order becomes a roadmap and you cannot deviate from that roadmap (the court doesn’t like surprises). The only way to deviate from the road map is to amend the pretrial order which will only be done if you can show that “manifest injustice” will occur if it is not granted.
16(f). Sanctions
16(f) provides sanctions for a party or its attorney who:
1. Fail to appear at a scheduling or other pretrial conference;
2. Is substantially unprepared to participate or does not participate in good faith, i.e. a party that shows up denying they have the authority to settle the case – that’s considered bad faith; and
3. Fails to obey a scheduling order or other pretrial order.
The Sanctions are the same as in 37(b): expenses, dismissal, etc. Because this conference is so close to the trial date (typically just two weeks before), the sanctions for missing this tend to be quite severe.
Sanders v. Union Pacific
9th Circuit, 1998
Overworked attorney case
NATURE OF THE CASE: This was an appeal from a dismissal of a law suit with prejudice.
FACTS: Sanders (P) sued Union Pacific (D) under the Federal Employer's Liability Act for a work related injury. The trial date was set for November 1996 and a pretrial conference was set 10 days before the trial. The judge also issued an order setting forth the various time frames for various motions, oppositions, proposed instructions and other trial related documents. The order warned that a failure to comply will result in sanctions. P's counsel refused to comply with almost all of the requirements of the pretrial order. (A list of offenses is contained on page 528 Yeazell 6th). During the pretrial conference with a law clerk, P's counsel explained his delay in the present matter as resulting from another lawsuit involving a multiple death train collision. P's counsel made it clear that he was not prepared to go to trial and suggested a dismissal without prejudice. The trial judge dismissed the action with prejudice. P appealed.
HOLDING AND DECISION: (Per Curiam) Does a failure to contact a court or opposing counsel over the inability to meet the deadlines in a pretrial order justify a dismissal of the action with prejudice? Yes. Under these facts, P only informed the court of his troubles at the last minute and left the court with no ability to impose lesser sanctions. P's contention that the court violated Due Process because it failed to notify him that dismissal was imminent is without merit as the original court scheduling order expressly advised P that dismissal was a proper sanction for failure to comply. The trial court did not abuse its discretion by not choosing a less drastic sanction. We reject P's contention that the dismissal violated Due Process because P was not informed that dismissal was imminent. The court order was clearly and expressly notices that failure to comply could lead to a dismissal. The mere lack of a hearing does not advance P's cause. Affirmed (but later reversed for a different judge to hear the case in banc – a super panel of judges).
Dissent: (Canby, Judge) Dismissal is a harsh penalty and should be imposed only as a sanction in extreme circumstances. P's counsel was guilty of multiple failures but they all occurred at once as part of the pretrial conference as part of his general inability to be ready for the trial. This was not an instance of repeated dilatory behavior over a span of time. Litigation was also not inordinately delayed such that any rights of D were significantly impaired. P should have been warned that dismissal was imminent. A boiler plate warning in a preprinted order does not put a party on notice that dismissal is imminent.
Mistakes
Attorney unfortunate failures:
• Missed in limine deadline
• Did not meet and confer on jury instructions
• Exhibit and witness lists late
• No trial brief
• No response to defense’s in limine motions
Attorney critical failure:
• Did not ask for a continuance
Court unfortunate failure:
• Court did not hold a scheduling conference, instead issuing a “boilerplate warning on a preprinted form.”
Court critical failure:
• Court allowed a law clerk to hold final pretrial; never provided attorney an opportunity to be heard.
McKey v. Fairbarn
DC, 1965
NATURE OF THE CASE: This was an appeal from a directed verdict and a denial of a motion to amend.
FACTS: Fairbairn (D), acting as the agent of Haynes, rented a dwelling house to McKey (P) on a month to month basis. A leak was discovered and D agreed to eliminate the cause of the leak. Before D could act the room leaked again and Mrs. Littlejohn, P's mother in law, mopped up some of it but slipped and fell and sustained injuries. Littlejohn sued for damages, and at trial her counsel agreed with the trial judge's assessment of the case as one in negligence. Thereafter and during trial, counsel moved to amend the complaint and pretrial order to include citations to certain allegedly relevant housing regulations, but the judge denied the motion and directed a verdict for D. P appealed. Note: Littlejohn died from causes unrelated to the accident and P took over the suit as administratrix.
• Theory One (pretrial):
– Negligence
• Knowledge of defect
• Duty to repair
• Theory Two (middle of trial)
– Strict Liability under Housing Code
• Knowledge of defect unnecessary
It’s not fair to the defendant to switch gears and change the theory of the case just before trial.
JURY TRIALS
Seventh Amendment:
In suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise reexamined in any court of the United States, than according to the rules of the common law.
Courts today do a historic analysis; if your claim was recognized at common law in 1791, then according to the Seventh Amendment you have an absolute right to a jury trial.
If your claim was not recognized at common law in 1791 but rather was something tried before the court of equity, you are not entitled to a jury trial.
Rule of Thumb:
If you are looking for a judgment (money), that is typically a legal issue (jury trial)
If you want the judge to order your opponent to do something or to stop doing something, that is an equity issue (non-jury trial).
Two-Part Test:
1. The first step is to identify the closest historic analogue to the action in eighteenth century English practice and determine whether that historical analogue would be heard in Law or Equity.
2. The second step is to analyze the nature of the remedy sought and determine if it is legal or equitable in nature. Benson: What do you want?
Chauffeurs, Teamsters, & Helpers v. Terry
Supreme Court, 1990
In July 1983, plaintiffs brought suit against both the Union and McLean Trucking Company in the United States District Court for the Middle District of North Carolina, alleging that McLean had violated the collective bargaining agreement in violation of the Labor Management Relations Act, 29 U.S.C. § 185, and alleging that the Union had breached its duty of fair representation. Plaintiffs requested a permanent injunction requiring the defendants to restore their seniority and cease their illegal activity. They further requested compensatory damages for lost wages and health benefits. McLean filed for bankruptcy in 1986, and all the claims against it were voluntarily dismissed.
Plaintiffs had requested a jury trial in their pleadings, but the Union moved to strike the demand for a jury trial, on the grounds that the no right to a jury trial exists in a duty of fair representation suit. The District Court denied the defendant’s motion to strike, and the United States Court of Appeals for the Fourth Circuit affirmed, holding that the Seventh Amendment entitled the plaintiffs to a jury trial on their claims for monetary damages.
ISSUE: Are P’s entitled to a jury trial on their duty of fair representation claim?
P’s sue the truck company for violating the bargaining agreement (breach of contract).
P’s sue the union for fair representation (breach of duty).
Since actions to enforce collective bargaining agreements were unknown in 18th-century England (such agreements were unlawful at the time), the union argued that the action brought by the plaintiffs was, in essence, an attempt to vacate an arbitration award, which historically was considered an action in equity. Marshall rejected this argument because there had been no arbitration with regards to the union’s duty of fair representation. The union further argued that the suit was comparable to an action for breach of fiduciary duty (i.e. a suit concerning a trust), which was also considered an equitable action. The plaintiffs countered by comparing their suit to an action against an attorney for malpractice, which was an action at law.
Marshall conceded that the analogy to a trust action was more convincing, but reasoned that the right to a jury trial depended more on the nature of the issues to be tried. Although there was a fiduciary duty issue between the plaintiffs and the union, there was also an underlying breach of contract—that of the collective bargaining agreement between McLean and the plaintiffs.
Since the first part of the analysis failed to produce a dispositive result, Marshall then turned to the type of relief the plaintiffs sought. The only remaining remedy the plaintiffs sought against the union was compensatory damages, which are the traditional legal remedy. While restitutionary remedies such as back pay and benefits may be characterized as equitable when sought from an employer, the damages here were sought from the Union. Thus, Marshall held that the plaintiffs were requesting a legal remedy, and therefore, on the balance of the issues, were entitled to have their case heard by a jury.
Section III(A)
Union:
Action to vacate arbitration award
Action against a trustee for breach of fiduciary duty
Plaintiffs:
Malpractice action. The court didn’t like this argument because a client can always fire their attorney.
Equipoise:
Claim against Union: Like a breach of fiduciary duty claim
Claim against Employer: Like contract claim
Section III(B)
The only remedy sought is a request for compensatory damages.
Brennan’s Concurring Opinion: “There remains little purpose to our rattling through dusty attics of ancient writs. The time has come to borrow William of Occam’s razor and sever this portion of our analysis.”
Occam’s razor: "All things being equal, the simplest solution tends to be the best one."
Benson on Brennan: Why bother with the two-part test? Part one: not entitled to a jury, Part two: he is entitled to a jury. Why not skip one?
The historic analysis is important because you will deal with the issue of whether or not a particular claim existed in 1791.
RULE 38
Rule 38. Right to Jury Trial; Demand
(a) Right Preserved.
The right of trial by jury as declared by the Seventh Amendment to the Constitution or as given by a statute of the United States shall be preserved to the parties inviolate.
(d) Waiver.
The failure of a party to serve and file a demand as required by this rule constitutes a waiver by the party of trial by jury. A demand for trial by jury made as herein provided may not be withdrawn without the consent of the parties.
Benson: You can’t demand a jury trial and then wait just before trial to waive a jury trial. Your opponent has already relied on the fact that he or she will be arguing a jury trial. You prepare for a jury trial much differently than you would for a bench trial.
The Seventh Amendment has never been incorporated to the states.
Synopsis of Rule 38:
• Right is “preserved inviolate”
• Demand – Made in writing, filed and served on the parties
• Must be timely: within 10 days of last pleading directed to the issue
• Demand specifies the issues to be tried to a jury (“Demand trial by jury on all issues so triable”)
• Another party may designate additional issues
• Failure to timely demand constitutes WAIVER
• Must pay the filing fee or right to jury trial may be waived
Amoco Oil v. Torcomian
3rd Circuit, 1983
Torcomian (D) appealed from the judgment which denied D a jury trial on Amoco's (P) complaint that sought D's ejectment, among other equitable remedies. D also sought review of the denial of their compulsory counterclaims of fraud and breach of contract.
Amoco does not want a jury trial (big company going against the little, local guy).
Under federal law, which controls in this diversity action, actions seeking ejectment are deemed to be legal, not equitable.
D’s stated a compulsory counterclaim (arising out if the same transaction or occurrence) that included a claim for legal relief when they sought damages for breach of contract.
Amoco’s Claims: Legal or Equitable?
1. Ejectment Legal
2. Injunction restraining use of station Equitable
3. Injunction restraining use of name/logo Equitable
4. Money damages for lost profits Legal
5. “Mesne profits” Equitable
Torcomian’s Counterclaims:
1. Specific Performance Equitable
2. Claim for lost profits Legal
JURY TRIAL, SELECTION
Voir Dire or Jury Selection
Jurors are picked at random. Jury selection is very hard to do.
Two types of challenges:
1. For cause A specific conflict of interest between the jury and the situation, i.e. a relative of the defendant, employee of the company, etc.
2. Preempts (you get three) You cannot preempt based solely on race. If you don’t have a good reason why all three preempts were the same race or gender, you may be looking at a mistrial.
Opening Statements
The plaintiff usually starts with the opening statement (not argument). It’s a subtle argument but you can’t blatantly argue or you will draw an objection.
After the defendant gives his opening statement, the plaintiff begins his case. When the plaintiff calls his witnesses, he can only ask a direct question (open-ended question) and not a leading question as in cross-examination.
The essence of a trial is cross-examination.
The defendant presents his witnesses and asks direct questions, the plaintiff asks leading questions on cross-examination.
Closing Arguments
Lawyers can suggest what inferences the jury should draw. Only what the witnesses say is evidence but argument is perfectly permissible. The person with the burden of proof goes last.
Always poll the jury to check the votes.
APPELLATE PROCESS
Appealing Cases
You can only appeal if you suffered a grievance.
Adversity: Casebook Q’s (pp. 620-21)
1. If her damages are the same, she hasn’t lost anything. If she loses on the municipal code issue, she wins on the lease issue. If her damages are the same then she has suffered no loss and cannot file the appeal even though she lost a part of her case.
(a) Tenant injured slipping in water from leaking roof. Two theories:
1. Breach of lease;
2. Violation of municipal code. She wins on lease, loses on code. Damages are the same. Focus on what she is entitled to under each theory.
Can she appeal? No
Can lawyers appeal to avoid poor precedent? No
Can a tenants’ association appeal? No
(b) Plaintiff claims Dealer told her used car was new. Two theories:
1. Breach;
2 Fraud.
Court finds for plaintiff on contract, but not on fraud.
May she appeal? Yes, damages are different (difference between a new vehicle and punitive damages). Remember: What can you recover under each cause of action. Breach of contract claims can get jumbled up with tort claims and they typically are different.
(c) May Defendants appeal? Yes.
Have limits to representation in your retainer agreement, e.g. my representation ends at the trial court level and this agreement does not include an appeal. If you want an appeal, we enter into a separate agreement.
Mootness Doctrine
Moot: When a controversy has been resolved. It is grounded in the Constitution. Article III – the Federal Court have jurisdiction over cases and controversies.
Exception to the Mootness Doctrine:
There are certain types of controversies that by definition can never last long enough in order to get judicial review – capable of repetition but evading review.
Roe v. Wade Example: By the time the case went to the Supreme Court, the baby was already born – she could not get the relief she was seeking; therefore, the issue was moot. However, the exception allows the case to go forward.
Iowa divorce case Example: Supreme Court, 1975. A woman wanted to get a divorce and Iowa required her to live in Iowa for one year to get a divorce. By the time the case gets to the Supreme Court, she had lived there for a year. The Court upheld the Iowa law but the point being is they decided the case even though it was technically moot; however, she is representing any person who wants a divorce but has not lived in Iowa for one year.
WAIVER
Waiver – Preserving an Issue for Appeal
Black Letter Rule: In order to reach an issue on appeal, it must have been raised and ruled upon in the trial court.
Benson: This is a huge area of the law and ripe with malpractice.
Malpractice trap: If you don’t raise the issue at the lower court level, you have waived the issue. The courts are extremely hard on waiver. The issue has to be raised and be on the record as well as being very specific as to what you are asking for and why you believe you are entitled to it. The court will not entertain new arguments on appeal. This is makes it difficult for a trial lawyer.
You must list all of the reasons in an objection. You can’t just zero in your opponent’s weakness, you have to argue all issues on why your opponent is wrong. If you don’t, you waive all the other issues.
The Record: If it’s not on the record, it’s waived. Make sure that if something of substance happened at side-bar or in chambers, make sure it gets on the record in the presence of a court reporter. If it’s not on the record, it never happened.
Court policy:
1. You have to give the trial judge an intelligent basis for a fair decision. Your job is to know the law and convince the judge of the correctness of your decision. The judge can’t do that if you don’t tell the judge what the law is.
2. The appellate courts know that attorneys “sandbag” – knowing you are going to lose a case and will appeal not objecting to the issues. If you lose, you can tie it up on appeal for years hoping the other side will settle, run out of money, etc. The appellate court don’t allow for that. If you choose not to make the objection or make the argument at the trial court level, you’ve waived it.
3. You have to give the trial judge the opportunity to correct his or her own mistakes.
4. Weed out litigants.
It is one of the heaviest burdens on any lawyer who does litigation.
WAIVER EXCEPTION
Harmless Error (for Appellee only)
Black Letter Exception: An appellee may raise new issues as grounds for affirmance of an arguably wrong ruling. Issues not raised in formal cross-appeals are often raised in this fashion
Plain Error Doctrine
Appellate courts will hold trial courts accountable for truly bad applications of law under the “Plain Error” doctrine.
If a ruling from the court is so plainly erroneous, the court may take up that issue at its discretion even if it wasn’t objected to or “preserved” below. Think if it in terms of the court and the court’s power. Don’t ever count it because they don’t do it very often.
The ultimate waiver: SMJ. You can always argue subject matter jurisdiction at any level of the proceedings.
28 U.S.C. 1291
• 28 U.S.C. § 1291: “The courts of appeals shall have jurisdiction of appeals from all final decisions of the district courts of the United States….
• A final decision “is one which ends the litigation on the merits and leaves nothing for the court to do but execute the judgment.” Catlin v. US, 324 US 229 (1945).
Benson: In other words, if it isn’t a final decision, we have no jurisdiction, meaning, even if we want to hear the case, we can’t hear the case. Parties cannot stipulate to federal jurisdiction.
At the end of a final judgment, the appeal is by right. Absent the interlocutory appeal, any decision that a court makes leading up to the final judgment is un-reviewable.
Prevents parties from agreeing and stipulating jurisdiction
Liberty Mutual Insurance v. Wetzel
Supreme Court, 1976
NATURE OF THE CASE: This was an appeal from a partial summary judgment that found liability for violations of the Civil Rights Act. .
FACTS: Liberty Mutual Insurance Co. (D) was sued by its employees for violations of the Civil Rights Act of 1964. Ps contended that D's employee insurance benefits and maternity leave provisions violated Title VII of the Act. They sought a declaratory judgment, an injunction and damages. The district court granted the motion of Wetzel (P) for summary judgment for liability only, but not for any relief. D appealed, and the court of appeals affirmed. D appealed to the Supreme Court; a partial summary judgment is an appealable final judgment.
HOLDING AND DECISION: (Rehnquist, J.) Is a partial summary judgment for liability only appealable under 28 U.S.C. Section 1291? No. A court of appeals does not have jurisdiction to review a partial summary judgment. Section 1291 allows appeals from final judgments. Liability was established, but no relief was given; the judgment is not final. The court's action was an interlocutory order, which would have to be appealed under 28 U.S.C. Section 1292. The requirements for Section 1292 were not met in this present case. If injunctive relief had been granted the order would have been appealable under 1292(a)(1) but no such relief was granted herein. Rule 54(b) does not apply as well because the action is on a single claim. Congress at times has provided exceptions to the final judgment rule but none of those exceptions apply herein. Appeal dismissed.
Benson: This is a great example of how the appellate courts want to keep you out of their hair.
District Court: Hiring Policies violate Title VII. “…it is expressly directed that Judgment be entered for the Plaintiffs upon these claims of Plaintiffs’ Complaint, there being no just reason for delay.” Rule 54 – The judge can put language in the order making the case final.
RULE 54 – MUST READ!
When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment. In the absence of such determination and direction, any order or other form of decision, however designated, which adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties, and the order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties.
Benson: When you have multiple parties/multiple claims, and the court resolves some but not all of the claims, the court may put that language (no just reason for delay) in the final order. That makes that part of the order a final judgment and that means the court of appeals has jurisdiction to hear the case. If the court doesn’t put that language in there, then it’s not a final judgment. It puts tremendous authority in the hands of the district court to determine who at that point can appeal. It is entirely discretionary with the trial court.
Petitioners win at the court of appeals.
Supreme Court: Sua sponte (on their own) The court of appeals had no jurisdiction. The Court reads 54(b) and they find that it is limited to multiple claim actions and this case had only one claim.
Rule 54(b): Key concept
The court must resolve one entire claim that, prior to the joinder rules would have been brought separately, before it may exercise its discretion under Rule 54(b).
§1292(a): Key Concept
Because injunctive relief requires parties to DO or REFRAIN FROM an act, reversal of an erroneous injunction decision may be impossible if delay is allowed
1292(b): Two key concepts
1. 1292(b) requires the court to certify that the usual reason for finality (efficiency of a single appeal) does not exist
2. It also requires that the Court of Appeals AGREE.
Why didn’t this work in Liberty Mutual v. Wetzel? Because there was no injunction granted.
EXCEPTIONS TO THE FINAL JUDGMENT RULE
1. Collateral Order Doctrine
We read Lauro Lines v. Chasser
Doctrine is weakened by recent cases
2. Injunctions (grant or denial)
Easy exception to finality rule
3. Interlocutory Appeals
More &*%@ rules!!
4. Mandamus
Exceptional relief for the exceptional case
COLLATERAL ORDER DOCTRINE
A three-part test (Cohen v. Beneficial)
• Does the order “conclusively determine the disputed question?”
• Does it resolve an important issue completely separate from the merits of the action?
• Is the issue resolved effectively un-reviewable on appeal from a final judgment?
Lauro Lines v. Chasser
Supreme Court, 1989
NATURE OF THE CASE: This was an appeal of an interlocutory order of a denial to dismiss an action based on a forum selection clause.
FACTS: Chasser (P) and the other plaintiffs were passengers aboard the Achille Lauro when it was hijacked in the Mediterranean Sea by terrorists. P sued Lauro (D) for injuries suffered during the hijacking and for the wrongful death of Leon Klinghoffer. D moved to dismiss P's suit on the ground that a forum-selection clause printed on the passenger tickets limited any passenger to suing in Naples, Italy. The court held that the ticket did not give passengers reasonable notice that they were giving up the right to sue in the United States. D's motion was denied. D then appealed that denial. The court of appeals dismissed D's appeal, finding that the district court's order was interlocutory and not appealable. D appealed to the U.S. Supreme Court.
The defendants have no right to appeal because it’s not final because the case is going on. It is in the nature of an interlocutory appeal under 1292.
Scalia’s concurring opinion:
The reason we say the right not to be sued elsewhere than in Naples is “adequately vindicable”… (even though it is positively destroyed)…is that the right is not sufficiently important to overcome the policies against interlocutory appeals.
INJUNCTIONS
• Statute based [§1292(a)] exception for interlocutory orders granting or denying injunctions.
• Recognizes special and immediate harm that may flow from this extraordinary form of relief.
INTERLOCUTORY APPEALS § 1292
Interlocutory Appeal: When you bring an appeal before a final order. They are permissive only (by leave). Discovery orders, orders denying summary judgment, evidentiary rulings during trial, etc.
Step 1:
An interlocutory appeal can be granted when the district court certifies that the order:
1. “Involves a controlling question of law as to which there is a substantial ground for difference of opinion”; and
2. “An immediate appeal may materially advance the ultimate termination of the litigation.
Benson: That is odd that it puts in the hands of the trial court the decision as to who gets to appeal. If the court says no, you cannot appeal it – there is no certification language.
Step 2:
The Court of Appeals must agree.
23(f) Class Action Appeals. A court of appeals may permit an appeal from an order granting or denying a class-action certification under this rule if a petition for permission to appeal is filed with the circuit clerk within 10 days after the order is entered. You don’t have to get the permission of the trial court. You still have to get the stay however.
WRIT OF MANDAMUS
(Not really an appeal at all) A writ of mandamus is an order to get a public official to do something that the public official is required to do. Vote recounts, re-zoning issues, etc. Can be used against a judge (for a gross mistake) but VERY rare and is disfavored.
We’ve seen these in Civ Pro I:
è Burnham v. Superior Court
è World Wide Volkswagen v. Woodson
An independent proceeding to require a public official to do her job
Duty must be mandatory, not discretionary
A “drastic” remedy reserved for “extraordinary situations” (Kerr v. US District Court, 426 US 394, 402 (1976))
STANDARDS OF REVIEW ON APPEAL
When to take a case to the court of appeals you have to get the court to review it to win.
1. De novo review. We are going to look at this case “fresh.” We are not going to defer to the trial judge and we are going to substitute our judgment for the trial court’s judgment. Reserved for when the appellate court has an equal opportunity to review as much as the trial court did. The most important de novo review is the motion for summary judgment. De novo applies to questions of law.
2. Abuse of discretion review. We will only reverse the trial court if we think the trial court abused its discretion. You have to demonstrate that the discretion was so abusive that there was no discretion at all. Granted for misapplication of law and failure to explain grounds. The law gives trial court tremendous power. Abuse of discretion applies to questions of fact.
3. Clearly erroneous review. Rule 52(a) – Findings of Fact. The difference between de novo review and this review is in a de novo review the court of appeals has the exact same information as the trial court. In this review the court of appeals is working off just the record as opposed to actual people being present so the court of appeals is not going to second guess the factual finding of a trial court unless it’s clearly erroneous.
Determining what the standard of review is makes all the difference in the world.
Anderson v. Bessemer City
Supreme Court, 1985
NATURE OF THE CASE: This was an appeal of a finding of discriminatory intent by a District Court under Title VII of the Civil Rights Act of 1964.
FACTS: Anderson's (P) sued Bessemer City (D) for discrimination under Title VII of the Civil Rights Act of 1964. P alleged that she had been denied a position as Recreation Director because of her sex. After a two-day trial, the court issued a memorandum of decision setting forth its finding that P had been denied the position because of her sex and that male members of D's hiring commission had been biased against P because she was a woman. D appealed and the lower court's findings were reversed because they were clearly erroneous. P appealed.
The Court held that a trial judge’s finding of discriminatory intent was not clearly erroneous, even though it was based on minimal evidence and even though the judge had asked the parties to submit proposed findings of fact that the judge used in the opinion.
Benson: we have appellate courts to correct errors, not to retry cases. Trial courts are not dress rehearsals.
Upshot of Erie Railroad: Federal Courts deciding state law claims must apply state substantive law to those claims.
But remember, Article III of the United States Constitution gives Congress the right to create federal courts and authorizes the application of federal procedural law in adjudication of such claims. That’s why the general breakdown in diversity cases – and it sounds so simple when you say it this way – but in diversity cases, the federal courts apply the substantive law of the state and the procedural law of the Federal Courts.
We studied a variety of tests to determine when state law applies and when federal law applies and we looked at the following steps (The first two steps of the Erie analysis):
1. Is the Federal Court deciding a state law claim? In other words, is it a diversity jurisdiction or is jurisdiction premised upon supplemental jurisdiction? If the subject matter jurisdiction was federal question then obviously we do not have a state court issue anyway, so this applies only if the state court is either sitting in diversity or is entertaining a supplemental state claim.
If it’s a federal question then you apply federal law – both substantive and procedural federal law. If in contrast the federal law is deciding a state claim, then you go onto the second question:
2. Is there a direct conflict between the state rule and the federal rule? If there is no conflict you simply apply both where appropriate. If there is a conflict, you must then determine the source of the federal law that is in conflict with the state law. The source of the federal law might be the Constitution, a federal statute, an act of Congress, Federal Rules of Civil Procedure, or it may just be federal practice – what is customary in that particular federal court.
Remember, historically we looked at two tests:
Outcome-determinative Test: If application of the federal rule would change the outcome of the case, then you treated that rule as substantive and you applied state law – it’s an old test but it is still a relevant test – that’s why we mention it.
From that test the Court developed a newer test:
Balancing Test: First you do the Outcome-determinative test. If it has no effect on the outcome, then you apply federal law. If it does affect the outcome, then you have to balance the interest underlying the state and federal rules and apply the rule that has the strongest interest. Hanna v. Plumer.
Q: Would the application of federal law versus state law affect the outcome of a case in a way that would encourage forum shopping?
A: If the application of federal law would not affect the outcome, then you simply apply federal law. If the application of federal law would affect the outcome in this way, then you have to use the balancing test.
Policy Reasons:
Prevent forum shopping
Avoid inequitable administration of state law
Treat citizens the same in federal or state court
Civil Procedure II
Attack Outline Abridged Version
TYPES OF JOINDER:
(1) Claims FRCP 18
(2) Parties FRCP 20
JOINDER OF CLAIMS
FRCP 18 join all claims even if unrelated. Common law res judicata say brought or lost.
RES JUDICATA COMMON LAW
Claim 1 car accident, claim 2 failure to paint house. Aggregate claims to meet jurisdictional amount. Diverse go to federal court. Need SMJ for each claim. SMJ can be independent, FQ, anchor claim, or DC. Joinder wide open, limitation is SMJ.
SUPPLEMENTAL JURISDICTION
1367(a) require state claim same case or controversy over which SMJ exist. Use Logical relationship test: same core of operative facts. If yes, 2nd claim in. 1367(b) used in diversity only. Cant use supp juris when in diversity against persons made parties under rule 14, 19, 20, or 24.
TWO TYPES OF COUNTERCLAIMS
P sue D and D want to sue P
FRCP 13(a) Compulsory Counterclaims
Compulsory counterclaims must be brought or lost. In res judicata preclusion by rule. 13a has supp juris. Always lk 4 independent basis jurisdiction, b/c avoid core of operative facts test. If claim solely on supp and anchor claim dismissed, 1367 say dismiss. Compulsory counterclaims arise out of STO. STO determined by logical relationship test: core of operative facts. Test ask if the two claims are logically related in any significant way. This is the majority rule. They must derive from the same underlying facts.
FRCP 13(b) Permissive Counterclaims
Permissive counterclaims don’t arise out of STO. Don’t have to bring in suit 1. No supp juris. Require independent basis for SMJ: FQ or DC.
CROSS CLAIMS TYPICALLY USED BY D
FRCP 13g Arise out of STO as main claim
P sue D1 and D2 and D1 sue D2. Can include claims 4 derivative liability, FR 14 3RD P Practice. Use Core of operative facts test. Cross claims are permissive. Supp juris b/c STO. Once proper cross claim rule 18 apply and u join all claims. If claim unrelated need own independent basis for jurisdiction.
JOINDER OF PARTIES
FRCP 20 Permissive Joinder of Parties
(1) Claims by or against multiple parties must STO. Core of operative facts test used. AND
(2) Common questions of law or fact.
(3) SMJ
Must have complete diversity when you have multiple parties. Multiple Ps suing D1 if complete diversity and 1 meets jurisdictional amount then all Ps can join if amount under 75k.
MISJOINDER UNDER RULE 20
Before FRCP misjoinder case dismissed. Now FRCP 21 misjoinder severed from case. Just b/c all joined don’t mean tried together. FRCP 42(b) sever actions.
ACTIONS BY D
FRCP 14 3rd Party Practice (Impleader)
D saying proper derivative liability I owe P u owe me. Not its him not me.
OPTIONS FOR D
(1) Indemnification—D say 3p owe me all or
(2) Contribution—D say 3p owe me some of what I paid to P.
EXAMPLES OF DERIVATIVE LIABILITY
P(IA) vs. D (MI) vs. 3P (MI) wrongful death in by diversity. 1367b say P cant use supp juris to get around diversity, but here D, so claim good.
P (IA) vs. D (MI) vs. 3P (OH) 3P no c,t,r w/ MI. 3P in if serve w/n 100 miles (FRCP 4k1b). If joinder under rule 20 no “bulge rule.” Apply to rule 14 where long arm don’t meet D jurisdictionally and under rule 19.
P (IA) vs. D (MI) vs. 3P (IA)
P vs. 3P
P cant get into federal court b/c no complete diversity. 1367b prohibit supp juris 4 parties joinded under rule 14.
3P vs. P CAN 3RD PARTY BRING CLAIM?
Rule 14 allow 3P to assert claim against P need complete diversity. P cant assert a counterclaim b/c no supp juris, it’s a party joined by rule 14.
COMPLEX JOINDER
FRCP 19 compulsory joinder used for just adjudication. P don’t want court say yes.
19a defines necessary parties
(1) A person shall be joined as a party in the action if in the person’s absence complete relied cannot be accorded among those already parties or
(2) The person claims an interest relating to the subject of the action and is so situated that the disposition of the action in the person’s absence may
(i) as a practical matter impair or impede the person’s ability to protect their interest (PROTECT OUTSIDER) or
(ii) leave any of the persons already parties subject to substantial risk of incurring double, multiple, or otherwise inconsistent obligations by reason of the claimed interest (PROTECT D).
OVERVIEW OF WHERE COURTS ARE
If 19a1—19b not great problem. If another forum available dismiss and refile. If not, go fwd w/o additional party.
If 19a2i—if another forum available dismiss and refile, if not wont dismiss b/c absentee can intervene.
If 19a2ii—if no other forum risk to existing party double payout. Unless interpleader available stuck 2 determine who 2 protect. Court don’t want to dismiss.
PROCESS OF COMPULSORY JOINDER
(1) Once meet 19a then ask is joinder feasible? SMJ or PJ may prevent party from being joined. If party can be joined then court make them. If P refuse case dismissed 12b7. If 19a don’t apply party permissive and not compulsory.
(2) If party cant be joined then analyze under 19b, whether party is indispensable—cant do w/o. If party needed and cant be brought chance case dismissed. Only time u get 19b is if 19a met and joinder isn’t feasible.
DETERMINATION BY COURT WHENEVER JOINDER NOT FEASIBLE
FRCP 19(b)
(a) to what extent a judgment rendered in the person’s absence might be prejudical to the person or those already parties
(b) the extent to which by protective provisions in the judgment, by the shaping of relief, or other measures, the prejudice can be lessened or avoided
(c) whether a judgment rendered in the person’s absence will be adequate
(d) whether the plaintiff will have an adequate remedy if the action is dismissed for non joinder
The overarching principle is in making this determination in equity and good conscience, is it fair to join D or dismiss suit. Balance to decide dismiss or allow. If lack of jurisdiction dismiss and allow P refile in proper jurisdiction. In federal suit transfer and allow P join in new forum.
INTERVENTION (USED BY OUTSIDER WHEREAS 19 USED BY D)
FRCP 24 (a) Intervention as of right
Limit discretion of judge allow outsider in even if P or D don’t want. Intervene by timely application.
(1) when a statute of the US confers an unconditional right to intervene or
(2) when the applicant claims an interest relating to the property or transaction which is the subject of the action and the application is so situated that the disposition of the action may as a practical matter impair or impede the applicant’s ability to protect their interest, unless the applicant’s interest is adequately represented by existing parties.
TIMELINESS FACTORS
(1) How long applicant knew of interest?
(2) Prejudice to the existing parties from any such delay?
(3) Prejudice to the applicant if the motion is denied?
(4) Other unusual circumstances?
FRCP 24(b) Permissive intervention up to discretion of judge
Upon timely application anyone intervene in action:
(1) when a statute of the US confers a conditional right to intervene
(2) when applicant’s claim or defense and the main action have a question of law or fact inn common.
(3) Whether intervention will unduly delay or prejudice the adjudication of the rights of the original parties.
INTERPLEADER JOINDER DEVICE RULE 22
Must have:
(1) adverse claimants
(2) stake (some property, can be $)
(3) stakeholder—party in possession of stake
PROCESS FOR INTERPLEADER
(1) Identify multiple adverse (both claiming to be the owner) claimants to the stake/subject to double multiple liability.
(2) Identify stake
(3) Identify stakeholder
TWO TYPES OF INTERPLEADER RULE AND STATUTORY
RULE INTERPLEADER RULE 22
Must have:
(1) SMJ
Diversity—must be complete diversity btw stakeholder and all claimants.
Amount in controversy exceed 75k.
(2) PJ—must have over all claimants
(3) Venue—where all claimants reside if in same state or substantial apportion of the events or where property located.
(4) Injunction—against lawsuits brought by claimants to seek suits in other jurisdictions. Need to have a special showing that it is necessary in aid of courts jurisdiction.
(5) Depositing stake—not required, but court has equitable powers to do so.
STATUTORY INTERPLEADER 1335
Must have:
(1) SMJ
Diversity—two or more diverse claimants of diverse citizenships. Minimal diversity.
Amount in controversy—$500 or more
(2) PJ—nationwide SOP, go to any federal court in US.
(3) Venue—where any claimant reside.
(4) Injunction—statutorily authorized.
(5) Depositing—required
STAGES TO INTERPLEADER
(1) Apply to court for interpleader identify: stake, stakeholder, and multiple adverse claimants.
(2) Plead jurisdictional basis rule or statutory.
(3) Move on to next stage of litigation on the merits of the claim.
(4) If you have disinterested stakeholder don’t want stake:
i. If statutory they must deposit.
ii. If rule deposit and release from litigation.
(5) Parties fight out who owns stake. All parties bound by judgment b/c of res judicata.
(6) Where unknown claimants stakeholder give notice via publication.
(7) At end court issue permanent injunction from filing additional suits
TYPES OF STAKEHOLDERS
(1) Disinterested—not asserting claim to the stake. Excused after stage one.
(2) Interested—also claimant. Some courts consider citizenship of stakeholder to create minimal diversity if all claimants from same state.
CLASS ACTIONS
FRCP 23
HOW CLASS ACTIONS DIFFERENT:
(1) 3 class reps make decisions 4 collective body
(2) All suffered harm b/c of D
(3) Counsel experienced b/c represent rights of absentee clients
HOW TO GET CLASS ACTION
Define class then apply requirements of 23(a) prereqs to class action.
(1) Numerosity—the class is so numerous that joinder of all members is impracticable. The court will look at:
the number of people in the class. 100> safe, 40-100 grey area, 0-25 not typical.
Size of claim involved.
Amount of claim
Think about class action vs. joining 100 people under rule 20. If all joined all participate. Geographic distribution make impractical.
(2) Commonality—questions of law or fact common to class.
(3) Typicality—claims or defenses of reps typical to class. Class reps have to be members. Claim need to be typical substantively and financially.
(4) Adequacy of representation—rep will fairly and adequately protect interest of class. Focus on lawyers, make sure no conflicts of interest w/n class. If you show inadequacy of your interest cant be bound by judgment. Members can collaterally attack previous representation.
MEET ALL 4 STILL NEED TO MEET 1 IN 23B TO GET CERTIFICATION
23(b) class actions maintainable
(1) The prosecution of separate actions by or against individual members of the class would create risk of:
(a) inconsistent or varying adjudication with respect to individual members of the class which would establish incompatible standards of conduct for the party opposing the class, or
(b) adjudications with respect to individual members of the class which would as a practical matter be dispositive of the interests of other members not parties to the adjudications or substantially impair or impede their ability to protect their interests (Primary relief injunctive or declaratory. If court find injunctive or declaratory probably certified under b3 not b2) or
(2) the party opposing the class has acted or refused to act on grounds generally applicable to the class, thereby making appropriate final injunctive relief or corresponding declaratory relief with respect to the class as a whole or(3) the court finds that the question of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy.
B(1)(2) class action necessary b/c nature of case. B3 controversial device used for mass tort situations and where court struggle to determine to certify. Abuse takes place here.
TO CERTIFY B3 NEED:
(1) Predominance requirement
(2) Common question shared is liability—if class shares common question, but question of individual predominates class, then certification.
(3) Heightened commonality is predominance.
(4) Superiority—heightened numerosity—need to show superior method 2 joinder.
OPT OUT OPTION UNDER B3
(1) Receive notice of 23b3 action. Say yes or no.
(2) Do nothing member of class.
(3) Opt out not bound by judgment,
(4) Notice requires individual members who can be identified and located w/ reasonable efforts.
(5) Class reps pay for notices b/c financial ability mandatory.
(6) If firm put up $ may be conflict of interest.
(7) In 23b1&b2 no opt out and notice is different, just need to be appropriate.
APPEALING CERTIFICATION OF CLASS ACTIONS
FRCP 23f
Can get interrogatory appeals at the discretion of appellate court is application made w/n 10 days after entry of order of granting or denying class. Important b/c if class isn’t certified P will 41a and no final judgment and you cant appeal refusal to certify.
FEDERAL CLASS ACTIONS
Most federal class actions are federal question, b/c court has put barriers up for diversity of citizenship class actions.
(1) Federal question—determining whether the claims involved “arise under” federal law involved the same considerations in class actions as in any case.
(2) Diversity—to decide if diversity of citizenship exist only look at:
a. reps citizenship.
b. Amount in controversy—originally all members must meet jurisdictional amount. Now aggregate claims to meet it. Long as rep meet jurisdictional amount like joinder in rule 20 you can use supp juris to get other members in who have less.
CLAIM PRECLUSION
Res judicata synonym for claim prelusion. Issue preclusion is collateral estoppel. When cases say res judicata mean collateral estoppel. To have claim preclusion must have prior lawsuit. Asking if 2nd suit go fwd if 1st resolved. This is the protection of prior judgment, impel 2 bring all claims.
WHAT YOU NEED FOR CLAIM PRECLUSION
(1) Prior lawsuit
(2) Same claim in 2nd suit you had in 1st (include defenses)
claim was brought
claim should have been brought
TESTS TO DETERMINE IF CLAIM SHOULD HAVE BEEN BROUGHT
· Transactional approach—STO in relation in time, space, origin. Core of operative facts. (fed courts use, only require notice pleading)
· Same evidence test—same evidence prove 2nd case and 1st. Look at elements of claim and if claim should have been brought.
(3) Same parties
(4) Final judgment on the merits
(a) a final judgment is one that completely wraps up the matter in question, leaving the trial court nothing more to do.
(b) On the merits, claim preclusion bars all claims from the same core of facts. The doctrine applies only if the court actually resolved one or more claims involving those facts.
WHAT LAW USED WHEN ANALYZING CLAIM PRECLUSION
(1) Use law of court where first action brought.
(2) P claim 1 in state court but now in fed court, fed court must lk at state court law. (FC)
(3) If first judge from fed court and second in state court, lk at (FC and transactional view).
(4) If fed court 4 diversity use state law for preclusion for state where fed court sit. Unless countervailing fed interest.
(5) If first suit in state and second in fed, use state law b/c of FC 1738.
(6) If first court in FQ use fed law which is transactional view.
(7) If in DC look at underlying state law for state where fed law sitting.
(8) 2nd court looking at law of preclusion that applies in first court except when significant fed interest.
PARTIES
Names on complaint and those privity to case. With privity looking for someone who’s name didn’t appear in the action, but the parties in the first suit represented the identical legal right the new party is trying to assert.
BARRING DEFENSES
Claim preclusion mostly used for claims, but a claim based on the same basic elements as a defense that the party should have raised may be prevented.
(1) Compulsory counterclaims (NOT @ CL)—determine whether there is a compulsory counterclaim provision. If the jurisdiction where first suit litigated had a rule, it will control issue.
(2) If no requirement for D to bring in suit 1, then can bring in suit 2 unless it fall under compulsory counterclaim rule. The common law rule asks whether the claim would have been a defense in the first case. If the claim would have been a defense its barred. But if pure counterclaim its allowed, unless allowing would nullify rights of first judgment.
JUDGMENT ON THE MERITS
Don’t mean merit of case addressed.
ON THE MERTIS INCLUDE:
(1) SJ & DV
(2) 12b6
(3) Sanctions keep lawyers from refilling looking for new judge.
(4) In diversity cases look at state preclusion law to see what is & not on the merits.
NOT ON THE MERITS:
(1) Lack of SMJ or PJ (41b all u to refile)
(2) 12b7 go where u can join all parties
The opportunity to bring a claim is enough to bar, but with issue opportunity not enough.
ISSUE PRECLUSION
(1)(a) same issue in 2nd suit as in 1st
(b) the issue actually litigated—issues presented to the court (if admitted no good)
(c) determined—if a particular fact must have been decided in a particular way for the court to reach the result, issue preclusion will apply to that question. If the court could reach the result in one or more different ways, and it is not clear which path the court chose, issue preclusion don’t apply.
(2) valid and final judgment (not on the merits)—issue preclusion on PJ.
(3) The determination of the issue was essential (cant get judgment w/o that finding) to the prior judgment.
DETERMINATION ESSENTIAL
Alternative basis to reach judgment
Restatement I
All alternative basis given preclusive effect in alternative suit (minority view)
Restatement II
Alternative findings none have preclusive effect unless appealed and upheld on appeal.
REASONS NOT TO GIVE PRECLUSIVE EFFECT TO ALTERNATIVES:
(1) Flood courts
(2) Skepticism to trier of fact—maybe didn’t consider alternatives properly
(3) Protection, if you appeal issue given full consideration.
BURDEN OF PROOF
Can be issues of law or fact.
When you phrase issue it include the standard of proof: preponderance or beyond reasonable doubt.
PREPONDERANCE
More likely than not. B/C you prove preponderance don’t mean proof of beyond a reasonable doubt.
REASONABLE DOUBT
Prove reasonable doubt, assumption preponderance proven.
TYPES OF VERDICTS
(1) General verdict—don’t tell why the jury found the way they did. If we don’t know why we cant preclude an issue in second suit. We must know issued determined.
(2) Special verdict—list questions for jury to answer and those answers are their verdict and judge will apply law to answers and enter judgment.
(3) General verdict with interrogatories—give jury list of questions to answer and at end enter verdict for P or D.
PARTIES
Claim preclusion have same parties. Some jurisdictions require same parties (mutuality) for issue preclusion, but fed and many states don’t require.
FEDERAL SYSTEM
Federal system allow non mutual issue preclusion or collateral estoppel. Non mutual preclusion can be asserted against a party in the prior action. Non mutual a stranger to first suit against person who was a party in first action or in privity.
OFFENSIVE AND DEFENSIVE USE OF ISSUE PRECLUSION
When P using preclusive effect to help prove claim= offensive.
If issue preclusion used to defend second suit=defensive.
Issue preclusion include mutual or nonmutual and offensive and defensive preclusion.
Court afraid to allow non mutual offensive use, don’t wait Ps sitting back and waiting. If 1 P win they take advantage, if P lose not bound, then bring own suit. Court will look at fairness factors:
(1) could party easily have joined the first action? This address incentive not to join and wait to bring suit later, if P1 win use issue preclusion.
(2) Incentive to litigate 1st suit must be same or greater than incentive to litigate issue in 2nd suit. Look at foreseeability of additional litigation. If foreseeable court may say you should have known and should have litigated more strenuously in first suit.
(3) Existence of prior inconsistence judgments (1 or 2 in favor of D don’t prevent issue preclusion)
(4) Are there procedural opportunities in 2nd not in 1st to lead 2 different result? Rite 2 jury.
ERIE DOCTRINE
(1) Erie problem must be in federal court sitting in diversity and some conflict between federal and state law. Federal courts sitting in diversity must apply law of state instead of its own.
(2) If there is a conflict next determine source of the federal law in conflict.
THREE CATEGORIES OF ERIE ISSUES:
(1) Federal practice in conflict we ask:
would applying be outcome determinative?
i. if no, then fed law apply.
ii. If yes, we not only need to say the outcome will be changed…we need to see if the outcome is determinative in a way to lead to forum shopping or inequitable administration of state’s law. If the answer don’t defeat twin aims of erie, then balancing federal interest vs. state interest.
a. if strong fed interest then practice apply
b. if strong state interest state law apply
(2) FRCP in conflict we ask:
does it comply with the constitution?
Does it comply with the rules enabling act?
Presumptive answer is yes both complies.
(3) Procedural statute in conflict we ask:
is the statute constitutional?
A federal statute will always be applied if it governs the situation at hand. It is important to isolate the actual issue before the court in order to determine whether the statute applies.
b. determine whether the statute and state law truly conflict. If there is a way the court can apply both federal and state law, there is no conflict, and the court will apply both rules.
GOALS OF ERIE
(1) Prevent forum shopping
(2) Avoid inequitable administration of state law
Idea is to treat citizens the same in state or federal court.
GUIDELINES OF ERIE
Federal courts required to apply substantive law of state in diversity but free to apply federal procedural law. To determine if claim is substantive or procedural use outcome determinative test.
The outcome determinative test is seeing if the outcome would be different under federal law than state law. If outcome different than that law effects substantive rights and you apply state law. Balance test of looking at state and federal interests. No state interest federal apply. One significant fed interest is its ability to operate as a separate court system.
DEVICES TO GATHER INFORMATION
Discovery is the formal process of asking for and providing information in response to a request (required 2 ask). Disclosure is a rule mandating requirement without having to ask for information (required to give w/o asking).
(1) Start by looking at the scope of discovery.
(2) The key is does info lead to discovery of other admissible info. Material itself don’t have to be admissible.
(3) To define the scope of discovery look at the underlying substantive law—that defines what is relevant for the claims and defenses.
26a1
Initial disclosures must be made w/o request done before pretrial scheduling conf w/ judge:
name of individual likely to have discoverable info (party may use to support a claim or defense)
docs/tangible items
computation of damages and supporting docs
liability policies
PRIVILEGE
A privilege protects info from being disclosed by a particular source. Common privileges are:
(1) Attorney client
(2) 5th amendment
(3) Doctor-patient
(4) Psychotherapist-patient
(5) Interspousal
Privilege means outside the scope of discovery. Privileges must be properly asserted (26b5) or waived. 26b5 protection claw back provision, get back privileged or trial prep info you produced by mistake. DOES THIS NEED TO BE IN A LOG?
SEQUENCE OF DISCOVERY (BEGIN AFTER 26F CONF, AFTER DISCLOSURES)
Discovery typically begins shortly after pleadings filed and continue shortly before trial.
A. Discovery conference—FRCP 26f requires the parties to meet as soon as practicable to discuss the claims and defenses that have been filed and whether there is any possibility of settlement. If no settlement is reached, the parties are required to prepare a discovery plan.
(1) Discovery plan—covers the subjects on which discovery is to be had, the timing and form of mandatory disclosures and discovery, any agreement that the parties may reach that either limits discovery or relaxes limits prescribed by the rules, and any orders that the court should issue to facilitate the discovery process.
(2) Prereq to discovery—a party may not engage in formal discovery until after the discovery disclosures required by 26a.
B. Initial disclosures—shortly after the discovery conf parties make initial mandatory disclosures.
C. Party initiated discovery—once initial discovery complete parties may serve discovery requests on each other and on third party witnesses.
D. Pretrial disclosures—as the case nears trial, the parties make certain mandatory disclosures of expert witness info and other info to be offered at trial.
METHODS OF DISCOVERY
(1) Identify tools available to engage in discovery.
(2) There is a distinction between what’s available for parties and non parties.
TWO MAIN WAYS FOR ASKING QUESTIONS:
(1) Depositions—formalized interview, witness on oath, sternographer ask question write verbatim.
(2) Interrogatories—written questions you send and receive written responses.
INTERROGATORIES (rule 33)
(1) Only parties can receive interrogatories.
(2) 30 days to respond.
(3) You sign, person answering sign, and their attorney sign.
(4) Interrogatories are cheap but limited to basic non controversial info. No follow up questions.
(5) SOP on attorney unless court say otherwise
(6) Presumptive limit of 25 per party.
DEPOSITIONS (rule 30)
(1) available for parties and non parties.
(2) Can be recorded audio/video if agreed.
(3) When you send out notice of deposition have date, time, place, and record of methodization of record itself.
(4) Excellent fact gathering b/c can follow up on evasive answers
(5) More expensive b/c attorney time, back and forth questions and answers, & cost of transcript.
(6) Attorney present must keep quiet.
(7) Presumptive limit of 10 per side and 1 day of 7 hours.
(8) Ds as group get 10, Ps get 10, 3P get 10.
(9) SOP through attorney
NON PARTIES
Notice alone does not obligate the person to appear. Subpoena the non party witness to appear at the time and place specified in the notice of deposition.
i. location of deposition—the non party witness may move to quash the subpoena if it requires him to travel to a place more than 100 miles from where he lives, works, or does business.
ii. the subpoena must be issued by the district court in the district where the deposition is to be conducted (by the court, by attorney authorized to practice in the court, or attorney admitted to practice where underlying action pending)
iii. the subpoena may only be served:
anywhere in the district where the subpoena was issued
anywhere w/n 100 miles of the place where the deposition is to be conducted or
if state law so allows anywhere w/n the state in which the deposition is to be conducted.
DEPOSITION UPON A WRITTEN QUESTION
(1) Count towards 10 you are allotted.
(2) Write out questions and send to court reporter and serve to all parties ahead of time.
(3) Other party has 14 days to serve cross examinations.
(4) You don’t show up, witness show up, and court reporter read and take down oral answers.
(5) No limitations of interrogatories, but no follow up questions when answers evasive.
(6) Cheaper process b/c no attorney time. Gd device for basic info.
EXAMING THINGS (RULE 34) PRODUCTION AND INSPECTION OF DOCS AND THINGS
(1) Deal with production of things for inspection.
(2) Most common tool essential to prepare case.
(3) No limit on doc request or tangible items.
(4) A party may inspect movable things in the possession of non parties by noticing the deposition of that person and obtaining a subpoena duces tecum requiring the person to bring along certain described items.
(5) Send doc request describing materials you want produced.
(6) Docs, items in disclosure party provide category of description & location of docs.
(7) Requests must be relevant to the case.
(8) Doc request time consuming check for privileged info, make sure no info you should w/hold and if you are you have to assert objection on grounds of privilege, then produce law of privilege.
(9) Send to party and they respond w/n 30 days. They say if make production or object.
PHYSICAL AND MENTAL EXAMINATIONS OF HUMANS (RULE 35)
(1) Cover parties and non parties.
(2) Cant reach agreement, must show:
a. good cause and
a. condition that you are seeking exam of must be in controversy
WHEN D DIDN’T RAISE CONDITION AS DEFENSE AND EXAM BEING REQUEST:
(1) Something on record justify exam, general allegations not enough, must show specifics.
DEPOSITIONS OF ENTITIES
(1) Serve notice to entity describe nature of info you want.
(2) Can be for party or non party.
(3) Then obligation shift to entity to designate a person to appear on behalf of entity.
30(d)(1) Lawyer’s behavior during deposition
3 CIRCUMSTANCES WHERE LAWYER INSTRUCT WITNESS NOT TO ANSWER:
(1) To protect a privilege
(2) Enforce limitation on evidence already ordered by court or
(3) Adjurn deposition to present motion for PO.
PROCEEDINGS OF DEPOSITIONS
(1) If none apply, make objection on the question and allow witness to answer to fullest extent.
(2) If other side try to use before judge, you raise objection and judge decide if it can be used. There is no judge at deposition, so you make objection on the record.
(3) Must be non argumentative and non suggestive.
(4) If there is a dispute about the deposition (party asking irrelevant questions or time spent on baseless objections) can ask for extension.
(5) File motion to compel to the court:
first meet and confer
attach certificate that you met and conferred in good faith.
REQUEST FOR ADMISSION
(1) Used at end of discovery
(2) Only served on parties
(3) Party send out statement asking for admittance (admit or deny).
i. you don’t respond its deemed admitted
ii. 30 days to respond. Miss deadline you admit.
iii. If you object must give reasons.
iv. If you deny something u should have admitted u will be sanctioned (rule 36) cost pf having to prove point at trial
v. Don’t have to admit b/c witness says it happened (rule 37c2c pg. 425)
(4) If you can get people to admit material facts you can move for SJ.
(5) Admission is made for pending action only; consistent w/ collateral estoppel.
STEPS OF DISCOVERY
(1) Identify tool you can use
(2) Make sure info being sought w/n scope of permissible discovery—relevance then look at exceptions.
(3) Even if relevant exceptions to discovery available.
(4) Even if info relevant if privileged outside of scope.
PROTECTIVE ORDER
(1) Seek PO to protect privileged info & stop abusive deposition.
(2) We focus on PO to protect from discovery info otherwise discoverable.
(3) Courts doing balancing act to balance informational needs against privacy interest.
(4) Must meet and confer
TWO TYPES OF PROTECTIVE ORDERS
(1) No discovery PO—all info off limits
(2) Limited use PO—discovery allowed in limited uses for litigation.
TRIAL PREPARATION MATERIALS
File motion to compel to force disclosure of info. To get motion to compel you must:
(1) Meet and confer
(2) Certify and attach certificate you met and conferred.
(3) File motion to compel
· The work product doctrine now called trial preparation materials protection is not a privilege.
· The work product doctrine attempt to protect lawyer’s thought processes.
· Don’t want lazy lawyer set back & wait for trial brief.
· Trial preparation is not an absolute protection.
HOW TO GET INFO WHEN WORK PRODUCT DOCTRINE APPLY
(1) Get info if no other way to obtain the requested info and
(2) Substantial need
WORK PRODUCT DOCTRINE QUALIFIED IMMUNITY FROM DISCOVERY
(1) Qualified by substantial need and undue hardship exception. Different from privilege b/c privilege is absolutely protected.
(2) Trial preparation enjoy qualified immunity can overcome upon proper showing.
(3) Cant call work product a privilege b/c privilege means outside of discovery.
(4) Trial preparation says absent a showing of need and undue hardship info protected.
26b3 TRIAL PREP MATERIALS
(1) Docs/tangible items that will otherwise be discoverable &
(2) Prepared in anticipation (mere possibility that there could be litigation when memo created is not enough) there must be at the time doc created the subjective believe that litigation is a real possibility and that subjective belief must be objectively reasonable. When you prepare doc primary reason has to be to aid in litigation.
(3) By or for party or a party rep including attorney, consultant, surety (ALL 3 MUST B MET)
OVERCOME TRIAL PREP MATERIAL QUALIFIED IMMUNITY
(1) Witness statement is a term of art—to be statement must be substantially verbatim or adopted by witness, that has been signed. This is different from PI taking notes b/c no signature.
Party
To get witness statement a party can request their own info.
Party cant request statement of non party w/o additional steps. 26b3 says upon a special showing you may be able to overcome trial prep protection
Non Party
make request and get copy
(2) Factual work product
obtained w/ a showing of substantial need and
undue hardship and
party seeking has no reasonable alternative to get info.
Deals w/ info exclusively in control of one party.
Even when substantial need met try to protect opinion work product of attorney
Informational needs of case served by turning over factual side, but protect thoughts.
(3) Opinion work product—try to get absolutely protected.
IF YOU WANT TO W/HOLD DOCS FROM PRODUCTION
(1) Receive doc request and you believe memo protected by trial prep immunity.
(2) Object to extent request seeks doc protected.
(3) Include in privilege log, you are w/holding on grounds of privilege or its protected by trial prep materials.
(4) Provide description in log w/o reveling protective info; so other side and court can assess if your properly invoked the trial prep protections. Failure appear as waiver.
EXPERTS
Expert give opinion testimony, not lay person. Used to explain topic juror cant understand.
TYPES OF EXPERTS
(1) Actor expert—person has expertise involved in incident.
a. May give testimony, not protected by expert discovery rule.
b. ID who they are and don’t have to prepare report
(2) Expert retained for purposes of litigation—hired to:
a. appear and testify at trial (testify)
b. help lawyers prepare for depositions (non testifying)
EXPERTS RETAINED FOR PURPOSES OF LITIGATION:
NON TESTIFYING
(1) No discovery for opinions held, except 4 exceptional circumstances or request for exam report
(2) Look at if other side exercised due diligence to get requested info or if they could have got it themselves.
TESTIFYING EXPERT
(1) Must prepare written expert disclosure report before allowed to testify.
(2) Identify self as expert, basis of opinion, materials relied upon, background, & experience of testifying in the past.
(3) Report not timely 90 days before trial, expert excluded.
(4) If P’s expert court may dismiss case, D file SJ and it will be granted.
(5) To get discovery of other side expert wait for report.
FAILURE TO DISCLOSE
Rule 26g and Rule 37b Mechanisms to get Sanctions
Rule 37b
(1) Violation of preexisting court order (no sanction available for first violation).
TWO EXCEPTIONS DON’T NEED PREEXISTING ORDER
(1) Complete failure to respond to interrogatories or doc request. File motion to compel and file sanction for complete failure to respond.
(2) Failed deposition that has been properly noticed. Cost of failed deposition. Must meet and confer.
37g Failure to act in good faith & come up w/ discovery plan for 26f meeting, can get immediate sanction.
26g
(1) Immediate sanctions.
(2) Similar to rule 11; 3 requirements: signature, certification (info warranted by existing law), sanctions (all representations valid).
(3) No 21 days safe harbor provision.
(4) When you sign discovery requests you are making certifications, and when you respond and sign you are making certifications. If you violate, sanctions imposed are legal fees and cost for violation.
SUMMARY JUDGMENT
Device that allow end of case before trial.
(1) If no genuine issue as to material fact moving party entitled to SJ.
(2) Defense side SJ effective to eliminate pretrial cases w/o merits. Impossible before, had too affirmatively disprove P’s case to get dismissed. Now mandated after adequate time for discovery.
(3) SJ done on paper, no witnesses present, so no cross exam. If credibility issues SJ denied.
(4) If need testimony of one not deposed need affidavit: date, time, location, and facts that you saw. Need signature.
(5) Affidavits must be based on personal knowledge that set forth facts that would be admissible evidence and affirmatively demonstrate that the person making the affidavit is competent to testify on the matters covered by the affidavit. If D want to defeat SJ must say P didn’t sign.
BURDEN OF PRODUCTION
(1) P has burden of production.
(2) Has to produce evidence by a preponderance that it is more likely than not that an element is met.
(3) SJ entered against a party who fails to make a showing sufficient to establish the existence of an element essential to that party’s case and which bear BOP @ trial.
(4) Complete failure of proof of essential element make other facts immaterial.
(5) Moving party entitled to judgment as a matter of law b/c the nonmoving party failed to make a sufficient showing on an element to which P has BOP.
(6) Prior to SJ didn’t matter if P had BOP unless D prove P not true and someone else is liable to P.
(7) Now D after discovery can say P has burden of production.
(8) To defeat SJ P show evidence P harmed by D’s actions, and jury can look at evidence and say its more likely than not D’s actions caused injury.
(9) For P to get SJ must show no dispute as to essential facts establishing liability to D.
(10) SJ final judgment and on the merits. Preclude P from refilling.
(11) If D file motion for SJ, P can ask for more time (defer on ruling of motion).
SJ PROCESS
(1) Start w/ standard that moving party must show no genuine issue as to material fact.
(2) Non moving party (P) has to show there is a genuine issue. P has to show specific evidence to place D’s evidence in dispute.
(3) Once D file SJ, P respond in 2 ways:
argue that moving party for SJ has not adequately demonstrated a deficiency in the evidence available to the party resisting SJ or
P can present evidence to counter the movant’s evidence 2 show existence of issue of fact
(4) Not weighing conflicting evidence but seeing if there is conflicting evidence.
(5) SJ decide whether 2 version of facts, and is it necessary to have trial. Conflict = trial.
PRETRIAL PROCESS
(1) Final pretrial disclosures.
(2) Parties lay out who witnesses are, exhibits, materials from discovery. If witness appear not on disclosure list cant testify at trial.
(3) Judge use pretrial conf to clean up matters and get pretrial order in place. Settlement.
(4) Order will govern what happen at trial,.
(5) No matter what you alleged in complaint, what will be tried at trial is in pretrial order.
DIRECTED VERDICT
(1) Now at trial. In civil case after jury selection.
(2) Parties put on case, P give opening statement (outline of case).
(3) D give opening statement. Use non argumentative as form of argument.
(4) P put on witness called direct examinations. Produce exhibits.
(5) At close of P’s evidence, D can make motion for DV.
(6) FRCP 50 changed DV to judgment as a matter of law.
(7) Court can grant, deny, or defer.
(8) D put on evidence, exhibits, then D rests.
(9) P could make motion for DV and D can make motion for DV.
(10) P can rebut D’s case, then D can rebut.
(11) Then the close of all gatherings.
(12) If DV not granted judge tell jury law and how to apply to our case.
(13) Jury returns verdict and judgment entered.
(14) Up to 10 days after losing party can ask for JNOV which is now called renew motion for matter of law or file a motion for a new trial.
(15) If judge grant DV and he wrong you get new trial.
(16) Judge often deny DV to let it go to jury, and hope jury come back with right verdict.
(17) If judge reversed on appeal and they granted DV and case never got to jury you start all over.
(18) If judge deny and case go to jury and they make decision, then enter JNOV. If judge wrong and appellate throw out and go back to jury verdict and enter judgment on that.
(19) If lose DV at trial stage don’t think waste of time to make motion for JNOV.
(20) DV deal with burden of production.
DIFFERENCES BETWEEN SJ AND DV
(4) SJ pretrial use affidavits and answers interrogatories.
(5) DV only evidence considered is evidence at trial.
(6) Produce affidavit at pretrial but they never appeared at trial DV granted b/c not @ trial.
BURDEN OF PRODUCTION PRODUCING EVIDENCE (LEGAL STANDPOINT IF YOU MET PRODUCTION STANDARD)
(1) If P has burden of production need 2 produce enough info such that a rationale trier of fact can conclude by a preponderance of evidence the events occurred the way P said.
(2) If P fail to produce evidence then judgment as a matter of law for D.
(3) If D has burden of production, if they fail to produce evidence then judgment for P as a matter of law.
(4) Where parties meet burden of production, the burden of persuasion kicks in.
BURDEN OF PRODUCTION PROCESS
(1) If no direct evidence to prove if D is liable, need to draw an inference from the circumstantial evidence.
(2) If the circumstantial evidence points to two posing inferences, then P has the burden of production to produce evidence from which a rationale trier of fact could conclude that D is liable.
(3) Where its 50/50 the inferences that can be drawn from observed facts and evidence produced points to two opposing ways, the party having the burden of production must fail. If P fail, D granted directed verdict.
(4) If inferences are equally likely and one will make the D liable and the other not, a rationale trier of fact cannot conclude that one is more likely than the other. So case taken away from jury and judge grant DV.
(5) P produce eye witness testimony, courts will not except evidence that is scientifically or practically impossible to meet the burden.
(6) If P put on circumstantial evidence, and D put on direct evidence that the events didn’t occur as P say, the court say P must come back with direct evidence or put in dispute the direct evidence by D to meet burden of production.
(7) When P use circumstantial evidence to create inference and that inference is refuted with direct evidence, court say P must come up with direct evidence so there can be a jury trial.
BURDEN OF PERSUASION (TRIER OF FACT ROLE)
(1) Deals with the trier of fact. Have you persuaded trier of fact?
(2) Burden of production is did you produce enough info in your favor.
(3) Now did you persuade trier of fact in your favor.
(4) BOP all encompassing include burden of production and persuasion.
JNOV “CONTROLLING JURIES AFTER VERDICT”
(1) JNOV motion made after jury come back with verdict.
(2) If DV denied case go to jury they enter verdict and we go back to jury verdict and enter judgment so you don’t need new trial.
(3) In theory if JNOV granted DV should be granted.
(4) Many judges will deny DV and see what jury does and if necessary grant JNOV to get correct result.
(5) JNOV made now as long as DV motion made before case went to jury.
(6) If you don’t make DV at all you cant make JNOV motion.
(7) JNOV is asking judge to change the decisions that the jury made. JNOV is renewing DV; avoid reexam clause.
(8) Loser becomes winner
NEW TRIAL (rule 59)
(1) New trial motion can be made 10 days after judgment.
(2) 2 primary grounds:
error in procedure—i.e., judge made error in allowing certain evidence in that should have been excluded
verdict rendered by jury—is against the weight of the evidence.
(3) Motion can be made by 59d:
parties
judge
(4) New trial motion and JNOV often made together
(5) New trial cant be granted just b/c judge disagree. “13th juror” not allowed.
(6) Loser gets new chance
NEW TRIAL PROCESS
(1) Courts have broad discretion and its rarely overturned.
(2) Trial judge see witnesses and evidence. Appellate court get paper record of what occurred.
(3) Appellate court says 13th juror standard not good enough to set verdict aside, b/c judge would have done things differently.
(4) In exercising discretion to see if motion for new trial should be granted is the “miscarriage of justice” standard or seriously erroneous standard. For seriously erroneous standard the judge must say why result was seriously erroneous before new trial can be granted.
(5) Another standard is if a party failed to meet their burden of production. If they failed to make a DV motion they cant make JNOV. Some courts use this to determine if verdict is against the weight of the evidence.
(6) When we are dealing with verdict against the weight of the evidence to some extent judge substituting his view of the facts for that of the jury.
(7) Court say on appeal will give closer scrutiny to decisions granting new trial for verdict against the evidence then for procedural flaw.
(8) Appellate court will consider what they will review. Look at subject matter, if simple case with simple issues, courts say in districts courts applicability to grant new trial that verdict against the weight of evidence, this shouldn’t happen on a regular basis. With simple case trial judge in exercising discretion should leave to jury.
(9) On appeal with verdict against the weight of evidence appellate will give more scrutiny.
(10) First determine what is the appropriate standard district court should be applying, cant be 13th juror has to be erroneous result. If meet DV standard then gd.
(11) In applying miscarriage of justice standard DC should be given more deference to jurors with simple cases, w/ complex cases judge can look at decision and exercise discretion in granting new trial if they find miscarriage of justice in that decision.
(12) First is it a procedural problem, if verdict against the weight of evidence, have to use proper standard, no less than miscarriage of justice, trial judge have to be guided by complexity of case.
(13) If simple less likely to find miscarriage of justice.
(14) If complex—not the type of issues jurors are dealing with—and judge believe that verdict is not on the side of the weight, they can use discretion.
JNOV AND NEW TRIAL MOTIONS TOGETHER
If JNOV and New Trial motions are made together, FRCP 50c require court to rule on both.
4 POSSIBLE OUTCOMES:
(1) Deny both motions and judgment entered on jury’s verdict
(2) Deny JNOV and grant new trial motion
(3) Have new trial
(4) Court grant JNOV and conditionally deny new trial
Which of 4 is immediately appealable?
Immediate appeal not available where JNOV denied and new trial granted.
WHY JNOV AND NEW TRIAL MADE TOGETHER?
(1) Party make JNOV and New Trial hoping other party didn’t meet burden of production.
(2) But if judge say production met, buts it’s a miscarriage of justice than new trial.
TYPES OF NEW TRIAL
(1) Partial new trial—if judge believe evidence sufficient to warrant D liable, but damages awarded not supported by evidence court can order new trial on damages and leave liability in place. Can also say if there is liability and damages appropriate but judgment in regards to liability not right then new trial for liability. (WHOLE CASE NOT RETRIED)
(2) Conditional new trial:
A. Remittitur—court say to P order new trial on damages unless P agree to reduced amount of damages. If P say no then new trial on damages. (constitutional in fed courts, still awards amount w/n amount jury awarded)
B. Additur—court say to D damages not sufficient, so new trial unless you agree to pay higher amount. D can say ok, if they say no, then new trial on damages. (unconstitutional b/c of 7th amendment, don’t apply to state courts and violation of reexamination laws, court ordering payment beyond what jury awarded)
JURIES
(1) Jury right comes from 7th amendment. The 7th amendment preserves (not create) a right to a jury trial.
(2) Must use historical perspective to decide when jury available, effective 1791.
(3) Have to look back to see if jury right existed in 1791 or would it be tried in equity courts.
(4) Common law courts with writs had jury right i.e., trespass, debt (recover sums owed), covenant (to remedy breaches of written, sealed contracts, ejectment (to recover land unlawfully occupied, trover and replevin (to recover for unlawful taking of personal property), assumpsit (recover for breach of oral contracts).
(5) If your action went to chancellory courts seeking equitable relief, there was no jury right. Remedies such as injunctions, specific performance, recission, and accountings and procedural devices such as derivative suits, class actions, bills of peace, and bills of interpleader were within equity jurisdiction.
NEW CLAIM THAT DIDN’T EXIST IN 1791
(1) Look for historical analog to our claim—claim in 1791 that substantively look like our claim.
(2) Next look at remedy (typically more important).
(3) If claim existed in 1791 file where they would have. If not in 1791 do historical analog, if one not found, or not just one works its multiple, then look at nature of remedy sought.
(4) First step is figuring out if you have a right.
(5) Second step is making sure you get your jury.
HOW TO GET A JURY
(1) Make a demand—if not timely rule 38 says you will have waived your right.
(2) Serve separate doc making demand (better practice is to put in pleading, next to caption in pleading where it says complaint it will say jury trial demanded).
(3) You have 10 days after service of last pleading directed to the issue to demand jury. <11> you do.
(4) There is a constitutional right to a jury. If there is no jury right available and judge allow, its ok.
(5) Judge can give jury where one not available, but cant take jury right away where constitutionally there.
(6) To decide if jury right available look at face of Ps and Ds claims.
WHAT TO DO IF CASE HAS MIX OF COMMON LAW AND EQUITABLE CLAIMS:
(1) FRCP 2 merge law and equity, which allow for both to be brought in fed court.
(2) P can be bring legal claim and D can raise equitable defense.
(3) Joinder of equitable claims w/ legal claims don’t defeat jury right.
(4) There will be a hierarchy of how decisions determined:
Issues that are purely common law claim related (legal) jury decide first.
Any overlapping or common issues—issues overlapping the common law claim and equitable claim—jury will decide.
Judge decide any remaining purely equitable issues. The judge will be bound by the jury’s decision on common issues.
(5) When we have mixture we preserve jury right and any issues solely related to common law claim and those that overlap must be decided by jury first. The judge bound by decisions and then will decide all issues solely related to equitable claim. The idea is to protect jury right.
ADMINISTRATIVE AGENCIES WITH POWER
(1) Court distinguish between private and public rights with protection of jury rights.
(2) Public created by Congress and given to administrative agencies to enforce.
(3) If enforcement vested in administrative agency no 7th amendment problem in not having jury.
(4) If you have private rights of private parties at stake, if you put those in something called a court 7th amendment jury rights will be implemented.
(5) Court say bankruptcy code is dealing with private rights and code places enforcement in bankruptcy courts, in that context SC say 7th amendment must be recognized and preserved.
(6) If Congress creates new rights when they pass a statute new public rights enforceable by gov’t and trust enforcement to administrative agency court not likely to find that absence of jury creating constitutional problems.
(7) When private rights involved when the enforcement is placed in something called a court for enforcement of 7th amendment a problem is created if you try to deny jury right.
COMPOSITION OF JURY (rule 48)
(1) Historically juries were 12 people.
(2) Historically unanimous verdict required.
(3) Now jury as small as 6 constitutionally permissible, but 5 is not. All must participate unless excused.
(4) In some states you can have 9 unamious verdicts, up to 2 or 3 opposing verdicts assuming 12 peeps.
(5) Supreme court still views unanimous verdict as required in fed court, unless parties agree otherwise.
(6) Parties can agree to have jury of 4 decide, from a constitutional stand point cant force party to accept verdict with less than 6.
STAGES OF SELECTING JURY
Stage One
(1) Summon jury pool. Fill out basic questions, us citizen.
(2) Federal court in section 1861 require jury pool be selected at random. It is unconstitutional to discriminate. 1861 require that selection is random and that it represent a fair cross section of the community.
(3) To determine if fair look at appropriate representation of jury pool. With regards to protected classes look at race and gender.
(4) Jurors don’t have to be split by gender or race 50/50, just cant have underinclusion.
(5) Some use phone books, registration, licenses to summon jurors.
Stage Two: Voir Dire
(1) All summoned show up and have jury number.
(2) Then at random clerk read jury number and those go to courtroom.
(3) In Voir Dire trying to take folks who are potential jurors in case to ask questions to see if we want them.
(4) With Voir Dire we are looking for potential bias. The inability of juror to be impartial.
(5) In federal system most voir dire done by judge. State court let lawyers do it.
(6) To challenge jurors you have:
for cause challenge—unlimited. You have to show that juror is not qualified. Typical ground is that answer indicate bias in favor of one party. For cause challenge raised by parties, it can also be by court. Usually judge require party to raise particular issues, before strike prospective juror.
peremptory challenge—under fed statute you have 3. If court believe that peremptory challenge being used to create a pattern of discrimination the party may be required to provide a race neutral explanation. These are freebies, you cant say for cause reason, just something not right.
i. historically no explanation needed why you were striking a juror.
ii. If you can show pattern of racial or gender grounds courts can request neutral explanation.
(7) Failing to get a clear response if a juror will be impartial is an error.
(8) If juror lied about ability not to be bias to get a new trial you must show:
juror failed to answer a question in voir dire and
a correct response would have provided a valid basis for challenge for cause. If the honest answer would have given you grounds for a for cause challenge and they lied, then behavior is grounds for new trial.
EXCLUDING IMPROPER INFLUENCES ON THE JURY
(1) The courts wants to control info jurors exposed to that didn’t go through adversarial process.
(2) Info not tested through adversarial process is juror misconduct. Jurors don’t have obligation to explain how they reached a result or talk to lawyers after case.
(3) You can impeach the verdict of the jury if jury had extraneous influences.
(4) Judge instruct jury and lawyers have chance to submit proposed jury instructions. Judge also has power to comment on evidence, but must tell jury they can disagree with judge. Judge cant direct verdict
PURPOSE OF A JUDGE
(1) Judge has power to instruct jury and comment on evidemce.
(2) Want to make sure judge not bias. Controlled by 28 USC 144 & 455, which set out grounds rules for seeking judicial refusal. 144 says that when a party files a timely and sufficient affidavit that the judge has personal bias, judge shall proceed no further. The affidavit shall state the facts and the reasons, must be accompanied by certificate of counsel of record stating it was made in good faith.
(3) The judge rules on the motion for recusal. Some refer to another, but its not required.
(4) Must judges don’t want to sit on a case where there impartialness is being questioned.
TWO GROUNDS FOR RECUSAL:
455a can be waived. It is an appearance of impartialness. Would observer looking at judge reasonable conclude judge impartial, then grounds exist under 455a for seeking recusal.
455b judge must excuse himself, there is clearly a conflict.
i. Financial interest in the subject matter
ii. if judge has bias
iii. if judge practiced as a lawyer on the case
iv. if served as government attorney and gave opinion
APPEALS
3 BASIC APPEALS
(1) 1291 jurisdictional statutes. Before we can have appeal under 1291 need final judgment. Typically nothing left to do but execute judgment.
Execeptions:
(1) Interlocutory appeal 1292ab.
1292a—you can take interlocutory appeal for any order granting, denying, or modifying an injunction. While suit pending a party may seek preliminary injunction so that at the end of the suit they still have protection.
i. i.e., suit on knocking down building, get temporary restraining order. Only stay in place for 10 days, then party have to seek preliminary injunction, must give notice to opposing party and they must have chance to appear and be heard.
ii. If court deny preliminary injunction, 1292a allow losing party to immediately appeal.
iii. If they got injunction D can appeal granting immediately, don’t have to wait for final judgment.
iv. 1292a only apply to temporary injunctions not restraining orders. It has to be the granting or denying of an injunction. Don’t need court permission or appellate court to step in.
1292b
WHAT YOU NEED:
(1) Get district judge to certify question for appeal. Judge must certify that question you want to appeal materially advance resolution of the litigation (difficult to get interlocutory appeal, AC don’t like, DC hesitant).
(2) If question certified, appellate court has discretion under 1292b if they want to take appeal. Rare to see 1292b appeals granted.
(3) Got to get district court to certify and certify that the issue of law that there is a substantial dispute and that the dispute may substantially advance the decision of the suit. 23f give appellate court discretion to take.
WRIT OF MANDAMUS
(1) Writ of mandamus is not an appeal.
(2) You are seeking order requiring a public official to do some ministerial task that the law require.
(3) Extraordinary writ and not easily obtainable.
(4) You need to show:
i. public official has duty under law to perform an act and they aren’t.
ii. it has to get to the point where failure to actc or the act by the public official has gone so far as to go beyond the jurisdiction of what’s permissible, the law requiring this function be performed leaves no discretion and when the refuse to perform we need extraordinary writ to force them to.
(5) Appellate or supreme court will write opinion denying writ in such a way as to say they don’t think judge refusing to do act, judge just needs more info on issue. Now being made aware judge will do.
(6) This is a demand, first need final judgment. Rules 54 & 58 rule on merits prevailing party gets cost and attorney fees if statute provide for it.
FINAL JUDGMENTS
(1) Final judgment being entered rule 58 require separate doc for entering of final judgment.
(2) Judge enter judgment on verdict. If you don’t like and you thought you were entitled to judgment as a matter of law you can make JNOV assuming you made DV.
(3) Have to have final judgment or extraordinary situation where you are dealing with decision involving injunction. If get injunction and its modified and you don’t like its immediately appealable.
(4) To get interlocutory appeal you need 1292 certification and then exercise discretion by appellate courts.
(5) To get writ of mandamus you have to show that public official required and their decision is unreviewable on appeal if you had to wait for final judgment. If issue not immediately reviewed by appellate court cant be reviewed upon appeal.
