1. Historic Roots of Personal Jurisdiction
a. Pennoyer (Traditional Bases of Personal Jurisdiction)
i. Personal Jurisdiction was limited by boundaries of the state.
ii. States reserve sovereignty due to public law.
iii. P owned property in Oregon while living out of state. Suit was brought against
him with notification by publication. Property was attached after suit was filed.
iv. Every state owes a duty to protect its citizens and as such it is fair and just for
the state to take property of non-residents inside the state to pay claims of its
citizens.
v. Publication may be proper if property is first seized by state.
1. Law assumes seizing property would give notice as time suit is filed.
b. Hess
i. There must be actual service within the state of notice upon him or upon
someone authorized to accept service for him.
ii. Public Interest: State may enforce regulations to promote care on part of all
who use highways.
1. Implied consent of driver’s appointment of registrar as agent on whom
process may be served.
iii. Voluntarily operating in state is the same as voluntarily appearing in state.
2. Modern Personal Jurisdiction Doctrine
a. International Shoe
i. Certain minimum contacts with the forum state such that maintenance of the
suit does not offend traditional notions of fair play and substantial justice.
1. Sliding Scale: Continuous and systematic and related to action vs
isolated or occasional and unrelated
2. Pennoyer was not overruled but court expanded how to analyze based
on changing times.
ii. Doing Business:
1. Courts turned corporation’s ‘doing business’ into physical presence
within the state.
a. Created unpredictability as to where corporations could be
considered to be ‘doing business’
iii. General Jurisdiction: Activities are such a great quality and quantity that D can
be sued for actions regardless of how related they are.
iv. Long-Arm Statutes:
1. Just because test for personal jurisdiction is met does not require state
court to enforce it
a. State must have long arm statute that allows it
b. States are not required to have long arm statutes but without
them they cannot exercise PJ over nonresidents.
2. Enumerated long arm statutes
a. Does the statute cover the conduct?
b. Is the statute constitutional?
c. Can be preferable due to predictability so corporations can have
an idea where they will be liable to suit
3. Specific Jurisdiction: Applying the Minimum Contacts Analysis
a. McGee
i. D insured one person in CA and when that person died failed to pay. When
sued in CA court argued court didn’t have jurisdiction over them.
ii. It is sufficient that suit is based on K which had substantial connection to state.
1. Reinsurance K delivered in CA, premiums mailed from CA, insured is
resident of CA
iii. CA has manifest interest in providing effective means of protecting residents
when insurers refuse to pay
1. Insurance companies become judgment proof
iv. Burden on insurance company weighed against burden on individual
1. Insurance company can bear burden better than the individual
v. Full faith in credit
1. If judgment is void in CA it is not enforceable in TX
b. Hanson
i. Purposeful availment
1. For there to be PJ there must be some act by which D purposefully
avails itself to privilege of conducting business within forum state
invoking benefits and protections.
ii. Unilateral activity of a third party is not enough for minimum contacts.
iii. Restrictions are more than just a guarantee of immunity from inconvenient or
distant litigation. They’re a consequence of territorial limitations on the power
of respective states.
1. State does not acquire jurisdiction by being the ‘center of gravity’ of the
controversy.
2. Issue is not choice of law but rather PJ
c. World Wide Volkswagen
i. Stream of Commerce
1. Forum state does not exceed its powers if it asserts PJ over a
corporation that delivers its products into the stream of commerce with
expectation that they will be purchased by consumers in the forum
state.
a. Even if its foreseeable that product would end up in forum state
that alone has never been sufficient benchmark to establish PJ
2. If contacts arise from efforts of the manufacturer to directly serve the
market for its products in other states then it is not unreasonable to
subject it to suit in one of those states where allegedly defective
products were sold
a. The more business you do with consumers in a state the more
foreseeable a suit would be.
ii. Fairness Factors: Fair Play and Substantial Justice should be evaluated on…
1. State’s interest in hearing dispute
2. Plaintiff’s interest in obtaining convenient and effective relief
3. Interstate judicial system’s interest in obtaining most efficient
resolution
4. Shared interests of several states in furthering substantive social
policies.
5. Burden on the defendant in maintaining suit in forum state
iii. Dissent (Brennan)
1. D is connected to forum state as car was drove to forum state where
injury occurred.
a. Purposeful availment: Sale of car purposefully injects vehicle
into stream of interstate commerce.
2. If D suffers no inconvenience due process is not violated; constitutional
concepts of fairness no longer require extreme concern for D
3. If P can show chosen state has sufficient interest in litigation then D
who cannot show real injury to constitutionally protected interest
should have no constitutional excuse not to appear.
a. D should not have veto power over forum
d. Kulko
i. No PJ as D didn’t purposefully avail himself to forum state
ii. Fairness Factors
1. Shared interest of several states in furthering fundamental substantial
social policies
a. Family Harmony
i. Dad may not allow kids to go to CA to be with mom so
as not to avail himself to CA courts
1. Mom may not allow kids to come live with her
as she would have to go to NY to file for custody
e. Keeton
i. Minimum Contacts
1. Continuous and systematic connection with forum state
a. 10-15k copies of magazine every month
2. Cause of action arises from activity being conducted in forum state
3. P’s lack of residence in forum state does not defeat jurisdiction
established on basis of D’s contacts.
ii. Fairness Factors
1. State has an interest in ensuring its citizens aren’t harmed by false
publications. Interstate judicial efficiency has interest in resolving
lawsuit under single publication rule
iii. Circulation of magazines was purposefully directed at forum state
iv. Choice of law concerns should not distort jurisdictional inquiry
f. Calder
i. Effects of out of state conduct in forum state
1. PJ can be established through evaluating the effects of D’s out of state
conduct felt in the forum state.
a. Article was drawn from CA sources and brunt of harm was
suffered in CA
ii. Acts expressly aimed at forum state
1. Intentional and allegedly tortious acts were expressly aimed at FS.
a. Wrote and edited article knew would have potentially
devastating impact on P
b. Knew brunt of injury would be felt in state where P works and
live and in which magazine had largest circulation
2. Under these circumstances must reasonably anticipate being haled into
court in FS.
iii. State’s Interest
1. P’s contacts with forum state may be so manifold as to permit PJ when
it would not exist in their absence
a. Lack of residence will not defeat PJ but existence of residence
may make it stronger
b. State’s interest to protect citizens is extremely strong
g. Burger King
i. Majority (Brennan – Reverse McGee Analysis)
1. Contract Plus Analysis
a. Simply having a contract between states does not establish PJ.
What is important is what comes before and after the contract.
b. When D reaches out to another state to enter into K with
foreign corp as long as fairness factors aren’t breached PJ will
be established
2. Dispute grew out of contract which had substantial connection with FS
a. Damage felt from refusing to pay was felt in FS as that’s where
payments were sent.
b. There is foreseeability that D will be haled into court in FS.
3. Choice of law Provision
a. Choice of law analysis is distinctly different from PJ analysis but
if choice of law provision exists it shouldn’t be ignored.
i. In combination with 20 year relationship with FS
headquarters reinforces deliberate affiliation with FS.
ii. Dissent (Stevens & White – McGee Analysis)
1. All contacts were with local office, not headquarters
2. Relying solely on language of contract to determine purposeful
availment creates potential unfairness due to disparities in bargaining
power.
3. Circumstances of franchise and negotiations left D lack of notice and
financially unprepared for prospect of litigation in FS and as such void PJ
h. Asahi
i. Stream of Commerce Plus (Oconnor Plurality)
1. PJ is proper where contacts proximately result from actions of D that
create substantial connection with FS
a. Substantial connection must come about by action of D
purposefully directed towards FS.
b. Placement of product into stream of commerce without more is
not purposefully directing toward FS.
2. Corp who delivers products into stream of commerce with expectation
that they will be purchased by consumers in FS.
a. Additional conduct may indicate intent to serve market of FS
i. Designing product for market of FS
ii. Advertising in FS
iii. Establishing channels for providing regular advice to
customers in FS
iv. Marketing product through distributor who agreed to
serve as sales agent in FS
ii. Stream of Commerce (Brennan Plurality)
1. Stream of commerce: Refers to regular and anticipated flow of products
from manufacture to distributor to retail sale
a. If participant is aware final product is marketed in FS, possibility
of lawsuit cannot come as surprise.
b. D who places goods in stream of commerce benefits
economically from sale in state
c. Indirectly benefits state’s laws that regulate and facilitate
commercial activity.
i. Benefits occur regardless of participant directly
conducting business in state or engages in additional
conduct directed toward state.
iii. Additional Factors to Analyze (Stevens)
1. Purposeful availment analysis should take volume, value and hazardous
nature into account.
i. J. McIntyre
i. Not component part case but manufacturer distributing through exclusive
distributor case
ii. Targeted full US rather than specific state
iii. Kennedy: Targeted Approach
1. D must target their product to specific state
2. D must submit to sovereign authority of state
a. Did D’s activities manifest intention to submit to power of the
sovereign?
iv. Ginsberg
1. Intent was to target entire country and “get paid”
a. Best chance to get paid was in NJ where largest scrap metal
recycling business occurred in US
2. Targeting entire country when in combination with other facts has to be
considered purposeful availment
a. Marketing at trade shows
4. PJ based on Internet Contacts
a. Zippo
i. The more economic benefit the defendant receives the more likely the court will
find PJ.
ii. The level of contact is determined by the interactivity of the website and the
commercial nature of the exchange of information
1. Passive Website- No PJ
a. A passive website is little more than making information
available to those who are interested and is not grounds for PJ
2. Doing Business Over the Internet- PJ
a. If the defendant enters into contracts with residents of foreign
jurisdictions that involve the knowing and repeated
transmission of computer files over the internet then PJ is
proper
3. Interactive Website where user can exchange information- ??
a. Exercise of jurisdiction is determined by examining the level of
interactivity and commercial nature of the exchange of
information that occurs on the website
b. Young
i. Internet Test: Courts may exert PJ when…
1. D directs electronic activity into FS
2. With manifest intent to engage in business or other interactions within
FS
a. “We thus ask whether newspapers manifested intent to direct
website content to a Virginia audience”
b. Targeting Test
i. Newspapers and websites were targeted at CT
audience. Articles were targeted at policy of CT, not
Virginia prison.
3. And activity creates a potential cause of action in a person within FS
ii. Something more than posting and accessibility is needed to indicate that D
purposefully directed activity in a substantial way to FS.
1. Could not have reasonably anticipated being haled into court in FS to
answer
5. General Jurisdiction
a. Jurisdiction where the contacts are so substantial that we allow suits that are unrelated
to those contacts
b. Perkins
i. So Substantial Test: Corporation’s continuous and systematic activities may
make it fair and reasonable to subject corporation to proceedings in that state
at least so far as proceedings seek to enforce causes of action relating to those
very activities or other activities of the corporation in the state.
1. Examples of those activities:
a. Director’s meetings
b. Business Correspondence
c. Banking/Stock Transfers/Payment of Salaries
d. Purchasing of Machinery
2. Forum state was headquarters of corporation during this time.
Everything that could be done took place in FS
a. FS could be considered temporary place of business
ii. Corporation could be sued by anyone from anywhere for any action in state
regardless of where the action came from
c. Helicopteros
i. Majority (Blackmun)
1. Mere purchases even if occurring at regular intervals are not enough to
warrant state’s assertion of PJ over nonresident in cause of action not
related to purchases.
a. Contacts cannot be described as “continuous and systematic”
2. Corporation was never authorized to do business in FS and never had an
agent for service of process within the state.
ii. Dissent (Brennan)
1. Active participation in interstate commerce
a. As active participants in interstate commerce take advantage of
economic benefits and opportunities offered by various states,
it is only fair and reasonable to subject them to obligations that
may be imposed by those jurisdictions.
2. Related Too Standard
a. If you make the cause of action negligent training of pilot it now
arises out of contact but pure negligence claim would not arise
out of contact
d. Goodyear
i. General Jurisdiction in Stream of Commerce Setting
1. If corporation’s place of incorporation or principle place of business
were located in FS unquestionably would be general jurisdiction.
a. Not just continuous and systematic but really really really
continuous and systematic
2. Just putting something into stream of commerce will not be enough to
subject corporation to general jurisdiction
6. Quasi in rem Jurisdiction
a. Shaffer
i. Majority
1. All assertions of state-court jurisdiction must be evaluated according to
the standards set forth in International Shoe and its progeny
2. Only reason person would proceed with quasi in rem would be if state
had enumerated long arm statute that didn’t allow in personam
jurisdiction. Otherwise a person would sue in personam and attach
property if afraid of person running.
3. Asserting a quasi in rem suit based on a claim not related to actions that
occurred in the state is not appropriate.
4. State does not have statute that would treat acceptance of director’s
position as consent to jurisdiction
a. Strong state interest but interest was not manifest in lieu of
statute enforcing interest
ii. Stevens-Concurring
1. Concerned with someone purchasing stock in Delaware corporation not
knowing they could be compelled to show up in Delaware for suit not
related to stock or actions in the state
iii. Powell-Concurring
1. Agrees with majority but believes real estate (property that is legally
and permanently located within the state) would still recognize quasi in
rem as this is much more clear than many of the things that have been
being attached
a. Would avoid uncertainty of general International Shoe standard
without significant cost to traditional notions of fair play and
substantial justice
iv. Brennan- Dissenting
1. Concerned with state interest in providing restitution for local
corporations that have been victimized by fiduciary misconduct
a. Strong regulatory interest
b. Choice of law inquiry is same as state’s interest inquiry
2. All you need is a little contact with a strong state’s interest
b. After Shaffer In Rem and Quasi in Rem are effectively eliminated. All personal
jurisdiction cases will require in personam jurisdiction.
7. Transient Jurisdiction
a. Burnham
i. Scalia-Plurality
1. All precedent states that PJ is proper when served with summons while
in state.
2. International Shoe and everything after is an attempt to figure out what
contacts are necessary to stand for proxy as being physically present
within the state.
3. Traditional notions are most important to consider as compared to fair
play and substantial justice.
4. Shafer dealt with a nonpresent nonresident so it made sense to apply
the International Shoe test
5. This case involves a physically present defendant so no additional
analysis is necessary
6. Distinguishes quasi in rem from nonresident served in FS as “perhaps
that assentation can be sustained when the perpetuation of ancient
forms is engaged by only a very small minority of the states”
a. When something is being followed by all of the states the court
should not attempt to overrule that
b. Not wedded to tradition forever but someone else needs to
change it first
ii. Stevens-Concurring
1. Keep the analysis simple, it didn’t have to be this complicated
iii. Brennan-Concurring
1. All rules of jurisdiction must satisfy contemporary notions of due
process
2. Fair play and substantial justice are traditional notions
3. Transient jurisdiction is still constitutional
a. If defendant can get to state to get served, they will not be
burdened to proceed with the suit in the forum state
b. By being physically present in the forum state the defendant is
availing himself of the benefits of the estate
c. Defendant would have benefits of being able to file suit in state
court but not able to be haled into court as defendant which
would create asymmetry.
d. Defendant should reasonably foresee being haled into court
when visiting the forum state as that has been the rule forever
which makes it fair.
iv. White- Concurring
1. Transient jurisdiction is normally enough but there may be
circumstances where it would need to be evaluated on the basis of the
facts of the case.
8. Consent
a. Carnival
i. Majority
1. Forum selection clauses are prima facia valid but are historically
disfavored as taking away state’s rights unless it can be found the clause
was entered into by fraud or misrepresentation. There must be notice
prior to the agreement.
2. Cruise line had special interest in limiting forum in which it could be
subject to suit (foreseeability)
a. Dispells confusion about where suit arising from contract must
be brought and defended sparing time and expense litigating PJ
b. Passenger who purchases tickets benefits in form of reduced
fares reflecting savings that party enjoys by limiting forum it
may be sued in
3. Clause may not be entered into in bad faith
a. A remote alien forum that has nothing to do with the injury or
where the party is located would not be acceptable
4. Clause may not involve fraud or overreaching
5. Consumers must have been given notice about the clause
a. If forum selection clause is in tiny print and have to click
through multiple pages to get to it there may be a notice issue
ii. Dissent- Stevens & Marshall
1. Notice was not given here as plaintiff had no chance to review contract
prior to purchasing tickets
2. Forum selection clauses should be more heavily scrutinized in contracts
of adhesion than those freely bargained for.
9. Personal Jurisdiction in Federal Courts
a. Rule 4(k)
i. Serving a summons or filing a waiver of service establishes PJ over a defendant
1. Who is subject to the jurisdiction of a court of general jurisdiction in the
state where the district court is located
2. Who is a party joined under rule 14 or 19 and is served within a judicial
district of the United States and not more than 100 miles from where
the summons was issued
3. When authorized by a federal statute
ii. For a claim that arises under federal law serving a summons or filing a waiver of
service establishes PJ over a defendant if
1. The defendant is not subject to jurisdiction in any state’s court of
general jurisdiction and executing jurisdiction is consisted with the
United States Constitution and law
b. General Jurisdiction is a State Court’s general jurisdiction that handles cases of any form
c. You have to have proper service of process to have a binding enforceable judgment
10. Constitutional Notice Requirement
a. Mullane v Central Hanover Bank
i. Property must have notice and opportunity to be heard for judgment to be
binding
ii. Notice must be reasonably calculated under all circumstances to apprise
interested parties of the pendency of the action and afford them an opportunity
to present their objections
1. Notice has to tell party where and when, giving them enough time to
appear.
a. Notice placed on a back door saying hearing is tomorrow is not
enough
iii. Service may be defended on the ground that it is in itself reasonably certain to
inform those affected.
1. Where conditions do not reasonably permit such notice that the form
chosen is not substantially less likely than other feasible and customary
substitutes.
iv. Publication may be acceptable notice if property is seized or if it is not
reasonably possible or practicable to give more adequate warning, like where
party’s location is unknown or party is dodging process of service.
1. Publication in and of itself is not enough to provide a party adequate
notice
v. Known individuals are entitled to notice by mail at least
1. Publication would violate due process in this situation
2. Notice reasonably certain to reach most of those interested in objecting
is likely to safeguard interests of all since any objections sustained
would insure the benefits of all
a. Class action lawsuit style where one represents all
3. Notice is inadequate, not because in fact fails to reach everyone but
because under the circumstances it is not reasonably calculated to
reach those who could easily be informed by other means at hand.
11. Subject Matter Jurisdiction
a. Overview of Subject Matter Jurisdiction
i. Critical piece of where within a state can suit be filed
ii. If court doesn’t have subject matter jurisdiction it doesn’t have competence to
decide the case
1. Federal trial courts are courts of limited jurisdiction
iii. Constitution does not empower Federal District Courts to exercise jurisdiction
but rather simply limited what could be authorized by Congress.
1. Congress had to come behind and enact statutes to empower courts to
do so.
b. Diversity Jurisdiction
i. 28 USC §1332 Diversity of Citizenship
1. The district courts shall have original jurisdiction of all civil actions
where the matter in controversy exceeds the sum or value of $75,000
and is between
a. Citizens of different states
b. Citizens of a State and citizens of a foreign state, except
between citizens of a State and citizens or subjects of a foreign
state who are lawfully admitted for permanent residence in the
United States and are domiciled in the same State
c. Citizens of different States and in which citizens or subjects of a
foreign state are additional parties
2. A corporation shall be deemed to be a citizen of ever State and foreign
state by which it has been incorporated AND of the State or foreign
state where it has its principle place of business
3. Insurance companies will be deemed a citizen of the following
a. Every State and foreign state of which the insured is a citizen
b. Every State and foreign state by which the insurer has been
incorporated
c. The State or foreign state where the insurer has its principle
place of business
ii.
iii.
iv.
v.
vi.
vii.
viii.
4. The legal representative of the estate is considered to be a citizen only
of the State as the decedent
Amount in controversy must exceed sum or value greater than $75,000
1. Amount does not include interest or costs
2. Plaintiff may aggregate claims against a single defendant by a single
plaintiff
a. A files fraud claim 40k against B and A files breach of contract
40k against B – Total claims of A against B 80k
3. Amount in controversy must be based on plaintiff’s claims
a. A brings claim 40k against B and B files counter claim against A
for 100k – No subject matter jurisdiction
4. Two separate plaintiffs cannot aggregate claims together to meet
amount in controversy
a. P1 claim 40k against D and P2 claim 50k against D
5. Plaintiff may not aggregate claims against multiple defendants
a. P claim 40k against D1 and P claim 40k against D2
6. Plaintiff may meet amount in controversy in joint liability claims
a. Must be one claim for damages even though there are multiple
defendants
b. P claim 80k against D1&D2 together in one action
Time of Filling Rule:
1. Changes in domicile after complaint is filled will not factor into analysis.
2. As long as diversity jurisdiction exists at time of filling, case will not be
dismissed
Corporation is deemed to be a resident in every state it is incorporated and its
principle place of business
1. Nerve Center Test: Principle place of business is where the corporation’s
high level officers direct, control and coordinate the corporation’s
activities. (Typically the corporate headquarters)
Minimal Diversity
1. Constitution only requires that one party have diversity rather than
complete diversity as required by Congress
2. Only applies in situations laid out by statute by Congress
Citizenships of Individuals
1. Current domicile of citizen
a. True and permanent place where you will always return
b. Requires the coincidence of residency and intent to remain
forever.
i. Ownership of property, where registered to drive,
driver’s license, job.
ii. Domicile is about intent but it is an objective test
Mas v Perry
1. Domicile does not change until you adopt a new domicile
a. Even if you say you’re not going back to CA, you’re still
domiciled there until you establish your new domicile
2. Burden of pleading citizenship is on party invoking federal jurisdiction.
3. If jurisdiction is challenged that party bears burden of proof
Del Vecchio
1. Rule 12(h)(3) If the court determines at any time that it lacks subject
matter jurisdiction the court must dismiss the action
a. Subject matter jurisdiction cannot be waived unlike PJ
2. Class action suits only consider the citizenship of the named class
representatives.
3. 2 part test for amount in controversy analysis
a. Are punitive damages recoverable as a matter of state law?
b. Is it clear beyond a legal certainty that plaintiff would under no
circumstances be entitled to recover required amount?
i. Plaintiff is normally given the benefit of the doubt but
complaint will be dismissed if it appears to a legal
certainty that the claim is really for less than the
jurisdictional amount.
4. It is plaintiff’s responsibility to plead value of required amount which
must be proved rather than be sheer speculation
5. Amount in controversy is judged at the time of filling so even if
defendant concedes some of the claimed damages it doesn’t cause the
value to fall below the minimum requirement
ix. 28 USC §1332 allows district court to deny costs to plaintiff who files case that
does not meet minimum amount in controversy.
c. Federal Question Jurisdiction
i. Authority of federal courts to hear cases involving federal constitutional,
statutory or treaty law
ii. Osborn
1. Federal statute creating bank authorized federal jurisdiction in any
matter involving the bank
2. Federal question must form an ingredient in every case.
a. Does not have to be pled but must simply be there regardless
3. Conferral of FQJ is valid whenever there exists in the background some
federal proposition that might be challenged despite the remoteness of
the likelihood of actual presentation of such federal question
iii. Well Pleaded Complaint
1. In order to have FQJ plaintiff must claim federal question issue in their
complaint
2. You can’t get federal jurisdiction by anticipating a federal question that
will get brought up in the defense
3. Court is only looking at the plaintiff’s claim for relief
a. Element of the cause of action must be federal
iv. Artful Pleading
1. An attempt by plaintiff to create FQJ through the anticipation and
inclusion of a federal defense on the fact of its complaint in an action
2. Can entail efforts to both avoid federal jurisdiction or to obtain it
v. Master of the Complaint Rule
1. Plaintiff is the master of the claim and may avoid federal jurisdiction by
exclusively relying on state law
vi. Declaratory Judgment 28 USC §2201
1. Any court of the United States upon the filing of an appropriate
pleading, may declare the rights and other legal relations of any
interested party seeking such declaration, whether or not further relief
is or could be sought
vii. Creation Test: A suit arises out of the law that creates the cause of action
viii. The Essential Federal Element Requirement
1. Merrell Dow
a. Majority
i. Lack of a private right of action implies to court that
claimed violation of statute is insufficiently substantial
to confer FQJ
ii. If there really is a federal question that gets decided by
a state court uniformity can be enforced through
Supreme Court’s review of state court decisions
involving federal laws
iii. Novelty is not a good argument to get a case into
federal court
iv. Congress’ failure to provide a private right of action
creates a lack of substantiality to violation element
causing Franchise Tax Board to not apply and thus not
create FQJ
b. Dissent- Brennan
i. Congress wanted uniformity of decisions through the
United States upon all subjects within the purview of
the Constitution
ii. Federal courts are more accurate at interpreting federal
law as they spend more time doing it
iii. Increased complexity of federal legislation argues for
FQJ as federal courts are more accurate
iv. Congress structured the act so that all express remedies
are provided by federal courts so it seems strange to
argue for a lack of FQJ
2. Franchise Tax Board
a. FQJ is appropriate when it appears that some substantial
disputed question of federal law is a necessary element of one
of the well-pleaded state claims
3. Grable & Sons
a. Test: Does a state-law claim necessarily raise a stated federal
issue actually disputed and substantial which a federal forum
may entertain without disrupting balance of federal and state
judicial responsibilities
i. Even if it is necessary disputed and substantial if it
disrupts the balance of the judicial responsibilities FQJ
won’t be appropriate
ii. Necessary: Whether service was appropriate is main
issue.
iii. Substantial: IRS is trying to collect taxes for federal
government and government’s ability to go after
delinquent members.
iv. Doesn’t disrupt judicial balance as there aren’t many
state title cases that raise a contested matter of federal
law. It won’t “open the floodgates”
b. Merrell Dow can’t be read whole as overturning decades of
precedent as it would have done by converting a federal cause
of action from sufficient condition to necessary one.
c. Private right of action signifies welcome mat stating everyone is
welcome to enter while lack of one simply means you may not
be welcome but doesn’t necessarily mean you can’t get in
4. Holmes Creation Test: The case arises from the law which creates the
cause of action
12. Supplemental Jurisdiction
a. If a plaintiff asserts a non-qualifying claim in connection with a claim that does fall
within original jurisdiction of federal courts it is possible the federal courts will be able
to assert supplemental jurisdiction over the non-qualifying claim.
b. Gibbs
i. Test: Did the state law claim and the federal claim derive from a common
nucleus of facts?
ii. Judicial Efficiency: Saves time by not trying essentially the same case twice as
they’re both based on the same facts
iii. Court is not required to exercise supplemental jurisdiction
iv. If federal claim is dismissed before trial, state claim should be dismissed as well
but it is not absolutely required
1. In this case trial court dismissed federal claim after trial had been
completed so it would be highly wasteful to dismiss the state claim at
the same time
v. Court evaluates whether judicial efficiency and fairness to litigants truly are
advanced by exercising supplemental jurisdiction
vi. Jury confusion due to different laws applying to the same facts is a good reason
to dismiss a state claim
c. Supplemental Jurisdiction After Gibbs
i. Pendant jurisdiction was based on common law, not statute
1. Supreme Court assumed in absence of Congress’ statement to the
contrary it was accepting of the exertion of authority
2. In Finley, Scalia reversed the presumption stating that jurisdiction was
presumptively impermissible unless Congress affirmatively authorized it
ii. In 1990 Congress passed 28 USC §1367 to codify effectively reversing Finley
iii. 28 USC §1367
1. If district courts have original jurisdiction, district courts shall have
supplemental jurisdiction over all claims in the action within such
original jurisdiction as long as they form part of the same case or
controversy
2. When district court has jurisdiction based solely on diversity jurisdiction,
district court does not have jurisdiction over claims by plaintiff against
person joined under Rule 14, 19, 20 or 24 or over persons proposed to
be joined as plaintiff under Rule 19 or seeking to intervene as plaintiff
under Rule 24 when exercising supplemental jurisdiction over such
claims would defeat diversity jurisdiction
iv. Supplemental Jurisdiction Test
1. What’s the basis for original subject matter jurisdiction?
2. Does the second claim arise from same operative nucleus of fact?
3. If basis for original subject matter jurisdiction was diversity does it fall
under defendant to be joined under 14, 19, 20, 24 or plaintiff under rule
19 or 24?
d. Interpreting the Supplemental Jurisdiction Statute
i. Exxon Mobil
1. Contamination Theory: If one claim is bad it must be dropped out or it
contaminates the full claim
2. Indivisibility Theory: Full action moves forward or falls as a single
indivisible “civil action”
3. How do you look at “civil action”?
a. Do you evaluate every claim individually to determine if any
single claim satisfies original jurisdiction or do you evaluate the
full action as a whole to see if the action meets original
jurisdiction?
4. Majority
a. Civil action is claim specific
i. You only need one claim to get original jurisdiction
b. Indivisibility theory fails as there would be no purpose for
supplemental jurisdiction if you look at the action as a whole.
i. Goes against the practice to treat claims as divisible,
dismissing claims that don’t meet jurisdictional
requirements
c. Contamination theory works in complete diversity situations
however amount in controversy failure does nothing to reduce
the importance of the claims that do meet the requirement.
5. Dissent- Ginsberg
a. District court must have original jurisdiction over a “civil action”
before supplemental jurisdiction can attach and supplemental
jurisdiction does not open the way for joinder of plaintiff who
does not independently meet the amount in controversy
requirement.
b. “Civil action” is interpreted not as aggregating claims
c. 1367 was enacted against backdrop of diversity including
complete diversity, amount in controversy and anti-aggregation
d. 1367(b)s purpose is to prevent plaintiff from circumventing
jurisdictional requirements by using another’s claim as a hook
to add a claim that plaintiff could not have brought in the first
instance.
e. Anti-aggregation rule causes it not to need to be addressed in
1367(b) as claim would never have been brought.
13. Removal Jurisdiction
a. General Standards of Removal
i. 28 USC §1441
1. Any civil action brought in state court which the district courts have
original jurisdiction may be removed by the defendant to the district
ii.
iii.
iv.
v.
vi.
court for the district and division embracing the place where such action
is pending.
2. A civil action otherwise removed SOLELY on the basis of diversity
jurisdiction may not be removed if any of the parties in interest are a
citizen of the State in which the suit is brought
3. If a civil action involves a federal question and a claim not within original
jurisdiction of a district court, the entire action may be removed if the
action would be removable without the inclusion of the claim without
original jurisdiction. Upon removal these claims will be served from
federal question claim and remanded to the state court.
28 USC §1446 Procedure for Removal of Civil Action
1. File notice of removal with district court within 30 days of receiving
notice of pending action
2. A case may not be removed more than one year after commencement
of the action in cases based solely on diversity.
3. In a case that initially was not removable that later becomes removable
due to dismissal of a claim, notice of removal may be filed within 30
days after receipt of notice by defendant that it has become removable.
4. Promptly after filing notice of removal defendant shall give written
notice to all parties and then file copy of notice with state court clerk.
Plaintiff is master of the claim determining where to file the claim
1. To stay in state court file claim in home state and add a defendant from
your state to defeat complete diversity
Defendant can remove case to federal court if federal court would have had
original jurisdiction over the claim
Hayes
1. Fact that you have a federal substantive claim doesn’t affect plaintiff’s
claims
2. If removal were allowed on basis of federal law defense defendant
would have exclusive choice of forum by pleading federal defense
a. Malpractice is a state claim, not federal and as such even if
malpractice is based on federal case can’t argue FQJ
Removal Test
1. Review each claim in complaint to see if any of them would have
original jurisdiction in federal court
2. Do additional claims arise under the common nucleus of fact?
3. Is original jurisdiction based solely on diversity?
4. Is supplemental jurisdiction valid?
14. Venue
a. 28 USC §1391 Venue Generally
i. Governs all civil actions brought in district court unless otherwise provided by
law
ii. Deals with residence…
1. A judicial district in which any defendant resides, if all defendants are
residents of the state in which the district is located
2. A judicial district in which a substantial part of the events or omissions
giving rise to the claim occurred or a substantial part of property that is
the subject of the action is situated
b.
c.
d.
e.
3. If there is NO district in which an action may otherwise be brought as
provided in this section, any judicial district in which any defendant is
subject to the court’s PJ with respect to such action
a. Only a fallback… only would apply if defendants are from
different states and events giving rise to the claim occurred out
of the country
iii. Residency
1. Natural person is deemed to reside in the judicial district in which that
person is domiciled
2. If a defendant in any judicial district in which such defendant is subject
to the court’s PJ with respect to the civil action in question and if a
plaintiff only in the judicial district in which it maintains its principal
place of business
iv. Residency of Corporations in states with multiple districts
1. In a state which has more than one judicial district and in which a
defendant is a corporation and is subject to PJ, such corporation shall be
deemed to reside in any district in that state within which its contacts
would be sufficient to subject it to PJ if that district were a separate
state and if there are no such districts within the district which it has the
most significant contacts.
Venue applies to the case as a whole, not a specific defendant
28 USC §1404 Change of Venue when Venue was Proper
i. For the convenience of parties and witnesses in the interest of justice a district
court may transfer any civil action to any other district or division where it might
have been brought or to any district or division to which all parties have
consented.
1. Venue is proper but for convenience of parties and interest of justice
court needs to transfer case.
28 USC §1406 Cure of Waiver of Defects
i. The district court of a district in which is filed a case laying venue in the wrong
division or district shall dismiss, or if be in the interest of justice, transfer such
case to any district or division in which it could have been brought
1. Venue is improper and court must dismiss or transfer to appropriate
venue.
2. Venue is waivable so if defendant does not raise it they waive the right
to complain.
Hoffman
i. 1404a only allows transfer to a district where the action might have been
originally been brought or to any district where all parties have consented.
ii. Majority- Whittaker
1. Plain reading of statute only allows transfer to where case could have
been brought at time of filling
2. Allowing defendant to transfer case based on waiver of PJ would be
discriminatory as it would allow defendant to move the case anywhere
it wanted but plaintiff would only have a few locations to file
a. Plaintiff can’t waive defendant’s PJ so they have limited choices
b. Would give defendant complete control of where the case
would be heard
iii. Dissent- Frankfurter
1. Where it might have been brought is ambiguous and could apply to
venue, amenability to service, period of limitations, to all of them or
none of them
a. Could apply to anywhere statute of limitations has not run
b. Could apply to any place where PJ was valid
2. Have to interpret 1404a against backdrop of venue
a. Venue can be waived so it makes sense that transfer can be
waivable as well
3. Not discriminatory as transfer would still have to be in interest of
convenience and justice
a. Fact that defendant can request transfer tempers plaintiff’s
ability to choose initial forum
f. Forum selection clauses are significant factors in the analysis but are not controlling of a
court’s determination of whether to transfer under 1406(a)
i. Plaintiff filing case in a location other than that listed in forum selection clause
would theoretically cause it to be incorrect venue and thus fall under 1406
rather than 1404
g. Smith
i. Factors that court weighs to determine whether transfer is warranted
1. Avaliability and convenience of witnesses and parties
2. Location of counsel
3. Location of books and records
4. Cost of obtaining attendance of witnesses and other trial expenses
5. Place of alleged wrong
6. Possibility of delay and prejudice if transfer is granted
7. Plaintiff’s choice of forum
h. Philip Morris
i. Judge decided to transfer without motion from either party
1. Trial court’s discretion is extremely broad
15. Choice of Law in Transfer
a. 1404(a) with proper PJ
i. Choice of law from location case is being transferred from applies
1. North District of GA transfers to North District of Illinois—Georgia law
ii. A transfer should do nothing other than change the courtroom
b. 1406(a) or 1404(a) without proper PJ
i. Choice of law from location case is being transferred to applies
1. North District of GA transfers to North District of Illinois—Illinois law
ii. To prevent plaintiff from filing in a location they know is not valid to achieve the
best choice of law
16. Forum Non Conveniens
a. Similar to transfer but is actually a DISMISSAL
b. THIS IS NOT A TRANSFER!!!!!
c. Suit is filed in proper forum but where it has been filed is substantially inconvenient and
there is a more convenient forum in a different judicial system
d. Case will be DISMISSED with ability to be refilled in the new forum with defendant
agreeing not to contest PJ or filing in that forum
i. Federal court cannot transfer a case to a different judicial system so case will be
dismissed.
e. Piper Aircraft
i. Representative will take on citizenship of those they represent but that can only
be a national state, not an international country.
1. In this case Reyno retained her citizenship from CA as those she
represented were all international
ii. Plaintiff’s choice of forum should be given substantial weight
iii. Standard for Dismissal
1. Chosen forum would establish oppressiveness and vexation to the
defendant out of all proportion to plaintiff’s convenience or
2. Chosen forum is inappropriate because of consideration’s affecting the
court’s own administrative and legal problems
iv. Private Interest Factors:
1. Relative ease of access to sources of proof
2. Availability of compulsory process for attendance of unwilling witnesses
and the cost of obtaining attending willing witnesses
3. Possibility of view of premises
4. All other practical problems that make trial of a case easy, expeditious
and inexpensive
v. Public Interest Factors:
1. Administrative difficulties flowing from court congestion
2. “local interest in having localized controversies decided at home”
3. Interest in having trial of diversity case in forum that is at home with the
law that must govern the action
4. Avoidance of unnecessary problems in conflicts of law or application of
foreign law
5. Unfairness of burdening citizens in unrelated forum with jury duty
vi. If all factors are met court does not have to dismiss the case but has broad
discretion to do so if it wishes
vii. Courts frequently give less weight to plaintiff’s forum choice when the plaintiff
is not an American citizen and particularly when the foreign citizens seek to
benefit from the more liberal tort rules provided for the protection of citizens of
the United States.
viii. Only time chance in favorable law should be given any weight would be if it
would result in a situation where plaintiff would be unable to recover anything
at all
ix. If less favorable law analysis were accepted it would defeat purpose of forum
non conveniens as plaintiff would always pick the location that has the most
favorable law to them
1. Would also require courts to weight which law is most favorable every
time a situation were encountered rather than simply choosing which
law would apply
x. Major issues as fact that defendants could not impede foreign defendants
causing additional lawsuits to need to be filed in Scottish courts