Transcript Assignment for M 11/4 - USC Gould School of Law

Agenda for 14th Class
• Admin
– Handouts
– Name plates
– A Civil Action screening
• Tomorrow 7:30PM WCC 2004
– Court visit Tuesday, November 19
• Roughly 1:30-4PM, but keep all afternoon clear
– A Civil Action panel
• Probably Th 11/21 at 7 or 7:30 in WCC 2004
• Fees in A Civil Action
• Joinder
• Class actions
• Intro to subject matter jurisdiction
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Assignment for M 11/4
– Federal Question Jurisdiction
– US Constitution Article III; 28 USC 1331, 1338, 1441(a)-(b)
– FRCP 8(a)(1), 12(b)(1), 12(h)(3)
– Yeazell pp. 191-206
– Summarize Louisville.
• Your summary should include the answer to Yeazell. P. 199 Q1
– Questions on the next slide
– Optional -- Glannon Chapter 4
• Diversity Jurisdiction
– 28 USC 1332
• Please consult the amended version of 1332(a)-(c) in the handout
– Yeazell pp. 207-21
– Yeazell Pp. 209 Q1, 3b, 4,
– Suppose P is a citizen of Turkey, and D is a citizen of Egypt admitted to
permanent residence in the US and domiciled in MA. P sues D in federal
district court to collect a $100,000 debt. Is there federal jurisdiction?
• Be sure to consider 28 USC 1332(a) both as it existed before 2011 (the
version in your pamphlet), the current version of 1332(a) (the version in the
handout), and the US Constitution, Article III, Section 2
• Can you see why 28 USC 1332(a) was amended in 2011?
2
– Optional. Glannon Ch 5
Federal Question Jurisdiction Questions
• Under the FRCP as it exists today
– If plaintiff had drafted a “well pleaded complaint,” what would have been the
key allegations of that complaint?
– If plaintiff had drafted a well-pleaded complaint, what paper would defendant
have filed in response? What would have been the key elements of that
paper?
– How would plaintiff have raised the unconstitutionality the Act of Congress
which the defendant alleges prohibited giving the passes that the railroad gave
the Mottleys?
– If defendant’s answer had admitted that it had given passes to the Mottleys,
but argued that they were invalid, what motion would the plaintiff have had to
make in order to get the Court to grant the Mottleys the relief they requested
without discovery or trial?
• Yeazell pp. 199ff Qs 2, 3, 4b,
• Under 28 USC 1441(a) & (b), if plaintiff had brought the two cases at issue in Yeazell
p. 199 Q2 in state court, which of the two cases could defendant remove to federal
district court?
3
Assignment for T 11/5
• Supplemental Jurisdiction
– Read 28 USC 1367 very carefully
– Test for Supplemental Jurisdiction (handout)
– Supplemental Jurisdiction Questions (handout)
• Optional
– Glannon. Ch. 16, 17
4
Last Class I: Settlement
• Factors encouraging settlement
– High litigation costs
– Risk aversion
– All lower plaintiff’s minimum acceptable offer and increases
defendants maximum offer
• Factor discouraging settlement
– Mutual optimism
• Raises plaintiff’s minimum and/or lowers defendants’
maximum offer
– Hard bargaining
• Means that even if plaintiff’s min is lower than defendant’s
max, parties may not reach a deal, because each is trying to
hard to get terms favorable to it.
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Last Class II: Fee Shifting
• Advantages of British Rule
– Allows plaintiffs to bring meritorious (high probability) cases, even
when litigation costs are high. See Example 11.
– Discourages plaintiffs from bringing frivolous (low probability)
suits. See Examples 15.
• Disadvantages of English Rule
– Public interest litigation to change the law may be deterred,
because it has a low probability of succeeding, even though it is
not “frivolous.”
– Risk averse plaintiffs may not bring even meritorious suits.
Example 14.
– Because of the way the English Rule magnifies optimism, it may
discourage settlement. See Example 16.
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Costs & Fees
• A Civil Action
• Given the settlement, how did they calculate how much Schlichtmann
and the other lawyers received?
7
Joinder
• Rules start from assumption that suits may involve a single plaintiff suing a single
defendant on a single claim
– Multiple parties and claims are allowed ONLY if explicitly permitted by a rule
• Proper joinder does NOT mean case properly in court, still need:
– Personal jurisdiction
– Subject matter jurisdiction
– Venue
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Joinder of Claims
Claim 1
Plaintiff
Defendant
Claim 2
• Joinder of claims always allowed. FRCP 18(a)
– But judge can, in discretion, always sever.
• Joinder is compulsory, if arises out of same transaction or occurrence
– Not in FRCP, but part of res judicata
– If related claim is brought in later action, defendant can have the case
dismissed by raising the defense of res judicata
Counterclaims (FRCP 13(a) &(b))
Original Claim
Original
plaintiff
Original
defendant
Counterclaim
• Counterclaims are always allowed. FRCP 13(a) and (b)
• Counterclaims are “compulsory” if they arise out of the same “transaction or
occurrence” as the original claim. FRCP 13(a)
– If compulsory counterclaim is not asserted, cannot be asserted in separate suit
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Joinder of Parties
Defendant 1
Plaintiff 1
Claim 1
Plaintiff
Claim 1
Defendant
Claim 2
Claim 2
Defendant 2
Plaintiff 2
• Joinder of parties allowed, if claims arise out of the
same transaction or occurrence AND there is a question
of law or fact in common. FRCP 20
• FRCP19 addresses compulsory joinder of “necessary
parties,” but not part of this course
Crossclaims
Original claim 1
Original
plaintiff
Defendant 1
Crossclaim
Original claim 2
Defendant 2
• Crossclaims are allowed only if they arise out of the
same transaction or occurrence as the original action.
FRCP 13(g)
• Crossclaimant can join unrelated claim(s). FRCP 18(a)
3rd Party Claims
Original
plaintiff
Original claim
Original Defendant
3rd party plaintiff
3rd party claim
3rd party defendant
• 3rd party claims allowed only if 3rd party plaintiff claims that 3rd party defendant is
liable to 3rd party plaintiff for some or all of liability that original defendant may
owe to original plaintiff. FRCP 14(a)(1)
– Indemnity – Contract in which one party (e.g. parts supplier) agrees to
reimburse another party (e.g. final manufacturer) for liaiblity (e.g. liability final
manufacturer may incur to consumer)
– Contribution – Part of tort law which allows jointly liable defendants to sue one
another to apportion liability
• Different from cross-claim, because 3rd party defendant wasn’t sued by original
plaintiff
3rd Party Claims (cont.)
Original
plaintiff
Original claim
Original Defendant
3rd party plaintiff
3rd party claim
3rd party defendant
• 3rd party plaintiff may join any claims it has against the 3rd party defendant. FRCP
18(a)
• Plaintiff may assert claims against 3rd party defendant that arise out of the same
transaction or occurrence
– Then 3rd party defendant may then file counterclaims or cross-claims. FRCP
14(a)(3)
Joinder Questions
– Pp. 816 Q5
– Pp. 818ff. Qs 1-2
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Class Actions I
• Class Action is super joinder device
– Way of joining lots of plaintiffs (or defendants)
– Single lawyer represents all
– Consent from each plaintiff not required
– “Class representative” is “named plaintiff”
• Usually chosen by class lawyer
• Advantages
– Low cost as compared to lots of individual suits
– Allows case to be brought where each plaintiff has stake that is too small to
justify individual suit
• But where, in aggregate, significant wrong has been done
• Disadvantages
– Class lawyer does not always act in interest of class
• May be more interested in fees for self than in relief for class
– Large magnitude of potential liability may “coerce” defendants into settling
weak claims
16
Class Actions II
• Class actions must be “certified”
– Plaintiff’s lawyer first brings regular (non-class-action) case on behalf of named
plaintiff(s)
– Plaintiff’s lawyer then petitions judge to certify class
• Prerequisites for class action
– 1. Numerosity. Class is so large that joinder (under Rule 20) is not practical.
23(a)(1)
– 2. Commonality. There are questions of law or fact common to all class
members. 23(a)(2)
– 3. Typicality. The class representative(s) have claims which are typical. 23(a)(3)
– 4. Adequacy. The class representative(s) can adequately represent class.
23(a)(4)
• Technically about parties.
• In reality, about class lawyers.
• Also, no conflicts of interest.
– 5. Case must fit into one of 23(b) categories
• See next page
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Class Actions III
• 23(b) categories
– (b)(3). Primarily for money damages
• E.g. mass tort
• Common issues must “predominate”
• Class action must be “superior to other available methods for fairly and
efficiently adjudicating the controversy”
– (b)(2). Injunctive or declaratory relief appropriate for whole class
• E.g. desegregation, prison conditions
– (b)(1). Risk of inconsistent litigation
• E.g. limited fund or conflicting injunctions
• Not very common
• Interlocutory appeal of certification decision. 23(f)
– Grant or denial
– Discretionary with court of appeals
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Class Actions IV
• Notice and Opt-Out. 23(c)(2)
– Only (b)(3) requires “best notice that is practical under the circumstances”
– Only (b)(3) requires the class members be given the opportunity to “opt out”
• Settlement with court approval only. 23(e)
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Class Action Questions
– Yeazell pp. 881ff. Qs 1, 2
• 1) BadCorp manipulated the price of its stock by failing
to disclose information that would cause share prices
to fall. Would a class action alleging violation of federal
securities law against BadCorp on behalf of all
shareholders who purchased stock during the period
when the information was being withheld be
appropriate?
• 2) BadPharm supplied blood to hemophiliacs, but
failed to screen adequately for AIDS. As a result, many
hemophiliacs in dozens of states got AIDS and some
died. Would a product liability class action against
BadPharm on behalf of all hemophiliacs who
contracted AIDS as a result of contaminated blood be
appropriate?
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Introduction to Subject Matter Jurisdiction
– Federal courts have limited jurisdiction
• Can hear only cases allowed by Constitution and statute
– 2 principle categories
• Diversity
– Plaintiff and defendant are citizens of different states
– Complete diversity rules
» No plaintiff is citizen of the same state as any defendant
– Alienage
» One party is US citizen, other party is foreign citizen
• Federal question
– Cases arising out of federal statute or constitution
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