Civil Procedure Outline—May
Civil Procedure- the body of rules, statutes, and doctrines that govern where and how private suits are
initiated, litigated, and resolved by litigants, attorneys and the courts.
Three Prerequisites for a Federal Court to Hear a Case—have to have all three
1. Jurisdiction Over the Person or Thing—Personal Jurisdiction: The court can bind the persons or things
brought before it to a judgment that must be enforced.
2. Subject Matter Jurisdiction: The court has the constitutional and statutory power to hear this kind of
case.
3. Venue: The plaintiff picked the court in the right geographic location.
Personal Jurisdiction
1. Personal Jurisdiction—jurisdiction over the parties to the dispute
 Without jurisdiction over the defendant, the court cannot render a binding judgment against
defendant

Compliance w/ Constitutional Attributes:
1. Full faith and credit clause--law of one state should be respected in all other states
 If State does not have PJ over D, then any decisions made by the State’s court do not
have to be given full faith and credit by other states.
 Idea of comity—states respect each others laws and judgments as coequals
sovereigns in a federal system
2. Privileges and Immunities Clause—a State cannot deny citizens of another state the same
privilege and immunities given to own citizens-subject to debate and interpretation still today
3. Due Process Clause of 5th and 14th Amendment—no State shall deprive any person of life,
liberty, or property w/out due process of the law.
 Minimum contacts AND
 Notice

The standard for evaluating the Constitutionality of a state’s assertion of PJ is the minimum contacts
analysis of International Shoe, which the Court has refined to mean that the defendant must have
purposeful contacts w/ forum state and assertion of jurisdiction may not be unreasonable.

Compliance w/ Federal Rule Civil Procedure 4k--4K helps you along the way! --Personal Jurisdiction in
Federal Courts
o FRCP 4 K(1)(A)— (Most relevant and commonly used): scope of personal jurisdiction in federal
cts is most often determined by scope of personal jurisdiction in the courts of the State where
the federal ct is located
 The usual means is compliance with States’ Long Arm provisions—use State’s long arm
statute to determine the State’s jurisdiction over a defendant and apply it to the federal
court located in that state. (Important for tests and bar exams)

3 types of jurisdiction—set out in Pennoyer
1. In Personum—refers to crts jurisdiction over a person or entity in an action against that party
 Specific
 General
2. In Rem—determines status of property w/in crts jurisdiction giving ct power only over the
property and its disposition, not the owners
3. Quasi-in-Rem—gives ct jurisdiction to render judgment against a person but recovery in the
action is limited to the value of property owned by that person w/in cts jurisdiction—property
itself not related to the subject matter of the dispute

When Does the Court’s Exercise of Jurisdiction Comport with Due Process?
1. Traditional Notions of Fair play and substantial justice
2. Consent by the defendant
3. Service on the defendant within the state where the court sits
4. Service outside the state when the defendant has minimum contacts with the state in which
the court sits sufficient to make the exercise of jurisdiction
Pennoyer v Neff—1877
Facts: Neff’s land seized w/out notice for unpaid legal fees in OR. Land sold to Pennoyer.
RULE: Compliance with constitutional due process and to assert in personam jurisd usually means:
presence OR consent
1. PRESENCE-someone needs to be there in state to accept service-either person or agent
o Must be given notice
o Service of process must be done in state
o Constructive notice (notice in newspaper) NOT enough for in personam jurisdiction
2. CONSENT—Defendant consents to jurisdiction of the court
3. Whether exercising PJ over nonresident would offend Traditional notions of fair play and
substantial justice
Facts about Pennoyer from Shaffer case
 Sharply limited availability of in personum juris over nonresident D’s. If D could not be
found in State, he could not be sued there.
 Favored nonresident D’s by making them harder to sue. Advantage reduced by
resident P bringing any property of non resident D located in P’s state into ct.
 State in which property located was considered to have exclusive sovereignty over
that property, in rem actions could proceed regardless of owner’s location.
 The owner of property is affected only “indirectly” by an in rem judgment adverse to
his interest in property subject to cts disposition
 USSC held after Pennoyer, tha t due process did not require any effort to five a
property owner PERSONAL notice that his property was involved in in rem proceeding.
 Mutually exclusive sovereignty of the States
Hess v Palowski--1927: Overrules Pennoyer
o
Facts: Hess a PA resident negligently drove on highway in MA causing an accident. No personal
service made on P and no property belonging to him was attached.
1. PRESENCE/Service--Still need to be served with service of process but do not
have to be in the state of the action.
 Under the MA statute it was required that D shall actually receive and
receipt for notice of the service and a copy of the process.
 State may declare that the use of the highway by nonresident is the
equivalent of appointing the registrar as agent on whom process can
be served.—implied appointment
2. CONSENT--Established IMPLIED CONSENT as means for exerting personal
jurisdiction over non-residents, but only motorists using public highways who
cause accidents. Later applied to other classes of nonresidents. Made implied
consent constitutional.
 Language of need to stretch Pennoyer as technology and information age was
expanding
 Because implied consent was an uncomfortable legal fiction, courts turned to notion of
presence to exercise PJ. Presence inferred from fact that corporation could be said to be
“doing business” w/in State
o A foreign corp is amendable to process in the absence of consent, only if it
doing business w/in the state in such manner and to such extent as to
warrant the inference that it is present there. Philadelphia &Readiny Ry.v
Mckibbin
International Shoe v State of Washington—1945
Facts: Intern’l Shoe did not pay unemployment wages to state of WA. I.S. had no office, no merchandise, no
delivery of goods—not a corp and not ‘doing business’ in state of WA, did have 13 salesman that lived there.
1. Presence--Pennoyer
2. Consent--Pennoyer
a. Expressed Consent
b. Implied Consent--Hess
i. MINIMUM CONTACTS—International Shoe
A. Contacts SYSTEMATIC AND CONTINUOUS over time
B. A state court’s assertion of PJ satisfies Due Process Clause if it does not
offend “Traditional notions of fair play and substantial justice”—exercise
of PJ is fair and reasonable
 It is evident that these operations establish sufficient contacts or
ties w/ the forum state to make it reasonable and just according
to our traditional conception of fair play and substantial justice.
C. D received benefits and protections from State from doing business in
State and must then also be liable to enforcement of laws of State—fair to
hale D into court.
 Satisfaction of due process depends on the quality and nature of
D’s activity in relation to the fair and orderly administration of
the laws that due process clause insures.
 Notice here was sufficient b/c it was served on WA employee and
the corp headquarters in MO.

The demands of due process may be met by such contacts of the
corp w/ forum state as make it reasonable to require corp to
defend particular suit brought in forum state.—An estimate of the
inconveniences which would result from a trial away from home is
relevant in this connection.
 Justice Black thinks that the above analysis was unnecessary because the prior
“Doing business test” establishes the same outcome in the case—if doing business
in the state, then consenting to be held liable in the state—availing self to that
State’s jurisdiction
o State Soveirgnty—believes the Constitution leaves each State the power
to tax and open their cts for their citizens to sue corps whose agents do
business in those States. The judgment above conditions the exercise of
this power upon the USSC’s notion of ‘fairplay.’ Black also believes that
they have stretched notion of due process so far as to deprive a State of
the right to give judicial protection to its citizens on the ground that it
would be more ‘convenient’ for corp to be sued elsewhere.
I.
Specific Jurisdiction—contacts related to dispute
A.
State Long-Arm Statutes
 To establish the constitutionality of Personal Jurisdiction in State Courts, first look to long
arm statutes
 PJ in State Courts—defined by terms of their respective long-arm statutes and confined by
limits of due process.
 Intern’l Shoe decision did not require state courts to exercise jurisdiction to the fullest
extent of the Constitution—it was each State’s decision on how to exercise jurisd.
 Long-Arm Statutes—range of circumstances States use to exercise PJ over Defendants
through jurisdictional statutes
I.
Enumerated Act Long-Arm Statutes—(NY) Defendant must engage in specific
conduct set out in statute for state to exercise PJ—otherwise even though it may
be constitutional to exercise PJ, state cannot if not explicitly in statute
II.
Promulgated Long-Arm Statutes—(RI) State courts assert PJ to fullest extent
allowed by Constitution’s Due Process Clause of 14th Amendment which is fullest
extent allowed by minimum contacts
B.
Minimum Contacts—2 Prong test (Established by Burger King)
Prong 1. Minimum contact standard/Purposeful Availment Prong
o
o
Establish minimum contacts which involves exclusive focus on D’s actions and activities
Plaintiff must prove that D has purposefully availed himself of forum
McGee v International Life Insurance Co—1957 (Justice Black)
 Facts: Franklin had insurance in CA through TX company that solicited his business and
sent regular correspondence to one another. TX corp fought jurisd in CA courts.

A single contact is sufficient for minimum contacts
o Looked at the quality and nature of the contact

Sufficient for purposes of due process that the suit was based on a
contract which had substantial connection w/ that State.
o Contract delivered in CA, premiums mailed from CA and insured
was a resident of CA when he died.

Purposeful Avaliment

Forum States’ Interest—Factor for PJ is State’s interest in providing a
forum for resolving the suit and protecting it’s citizens
o CA had a manifest interest in providing effective means for redress
for its residents when their insures refuse to pay claims.
Fairness for Plaintiff—P would be at severe disadvantage if forced to file
suit in insurance company’s State
Burden on Defendant—with modern transportation there is less of a
burden on party to defend case in state where he engages in economic
activity


A. Purposeful availment—defendant knows that he has availed to the benefits and
privileges of the court
 Hanson v Deckla—1958

Facts: Dora executed trust in DE while residing in PA. Dora moved to FL where she
died. FL tried to get jurisdiction over DE trust companies. USSC found that DE trusts
had no minimum contacts w/ FL—no office, no business transactions, no solicitation of
business

The execution in FL of the powers of appointment under which
beneficiaries and appointments claim does not give FL substantial
connection w/ the contract on which suit is based

Unilateral activity of those who claim some relationship w/ nonresident
defendant CANNOT satisfy minimum contact requirement w/ forum state.

Application of this rule will vary w/ “quality and nature” of D’s activity, but
essential that there is some act where D purposefully avails himself.

Purposeful Availment-- There must be some act where D Purposefully
avails himself of privilege of conducting activities invoking benefits and
protections of its laws.

Center of gravity (parties living in FL) does not convey jurisdiction, nor
does FL being the most convenient location for litigation.

Emphasis on State Sovereignty—Restrictions on the PJ of state courts are
more than a guarantee of immunity from inconvenient or distant
litigation. They are a consequence of territorial limitations on the power of
the respective states.
B. Foreseeability that D will be hauled into ct there
 Worldwide Volkswagen corp v Woodson—1980
 Facts: Seaway and WWV are Audi car sales companies in north east. Robinsons
were in bad accident in OK due to manufacturing default of Audi. WWV argues
that OK does not have PJ to try the case
 Minimum contacts protects D against burdens of litigation in a distant or
inconvenient forum and ensures that state courts do not reach beyond the
limits imposed by their status as coequal sovereigns in a federal system.
o (All the previous cases were broadening the courts reach on nonresident Defendant)
 FORESEEABILITY— foreseeability alone not enough—D’s conduct and
connection w/ forum state are such that he should reasonably
foresee/anticipate being haled into court there—not mere likelihood that
product will find way into forum state
o Volkswagen not marketing to clientele in OK
o It is foreseeable that car sold by D would make its way into OK, but
the mere ‘unilateral activity of those who claim some relationship
w/ nonresident D cannot satisfy the requirement of contact w/
forum state (Hanson)
 If D has no contacts, ties, or relations to State, then State has no PJ over D
even if other factors exist such as forum States’ strong interest or
inconvenience to D would be minimal, etc
o Balance of burden on D=”reasonableness/fairness” to other factors
such as State’s interest in adjudicating dispute, etc
 Cts don’t think that Seaway or WWV purposefully availed themselves to OK

Justice Brennan dissented believing that Worldwide Volkswagen did have
minimum contacts and that the majority opinion placed too much weight on
existence of contacts between forum state and D instead of forum State’s
interest
o Sliding scale approach—argues that International Shoe contemplated
significance of the contacts necessary to support juris would diminish if
some other consideration helped establish that juris would be fair and
reasonable—like interest of State and lesser burden on D to defend case


True nature of a car is to travel long distances—this is foreseeability
Ct puts too much emphasis on burden of D
 Burger King v Rudzewicz—1985 (Justice Brennan)
 Established 2 prong test. To establish PJ, first determine if there are minimum
contacts, then look at the reasonableness factors
 Facts: Rudzewicz owned a Burger King franchise in MI. Rud could not keep up w/
payments due to recession, however continued to operate despite Burger King
(main business in FL) shutting the MI franchise down. Rud arguing that FL does
not have PJ


To satisfy minimum contacts, the ‘quality and nature’ of D’s relationship w/
State CANNOT be viewed as “random, fortuitous, or attenuated”—in this case
quality and nature was not viewed as random, etc.
Purposeful availment requirement ensures that D will not be haled into
jurisdiction solely as result of ‘fortuitous’ or ‘attenuated’ contacts or of the
‘unilateral activity of another party’

Jurisdiction is proper where contacts proximately result from actions by D
himself that create a substantial connection w/ forum state.-- Contract had
substantial connection w/ FL

Once established that D has purposefully availed self of forum state, must
consider these contacts in light of other factions to determine whether the
assertion of personal jurisdiction would comport w/ fair play and substantial
justice.—2 Prong test
Foreseeability of causing injury to BK FL by not making required payments and
continued use of BK trademark


Choice-of-law provision—Ct states that nothing in their case history suggests
that these provisions should be ignored in considering whether D has
purposefully invoked benefits and protections of a State’s laws.
o Choice-of-law provision ALONE would be insufficient to confer jurisdiction,
but:
o When combined w/ 20 yr interdependent relationship w/ BK FL it
reinforced his deliberate affiliation w/ forum State and reasonable
foreseeability of possible litigation there—D purposefully availed himself
of benefits of FL laws by entering into contracts expressly providing that
those laws would govern franchise disputes

An Individual’s contract w/ out-of-state party cannot ALONE automatically
establish sufficient minimum contacts in other party’s forum state—instead one
must analyze the prior negotiations, contemplated future consequences and
terms of the contract

Jurisdiction may NOT be grounded on:
o Contracts whose terms were obtained thru fraud, undue influence, or
overweening bargaining power
o
Contracts whose application would make litigation so “gravely difficult and
inconvenient” that D would be deprived of day in ct.
 Justice Stevens and White (author of WWV) dissent—unfair to require franchisee to
defend case of this kind in forum chosen by franchisor. All of D’s contacts and business
were done in MI and D was in no position to negotiate terms of contract.
If purposeful availment and foreseeability are established, then look at prong 2
Prong 2. Reasonableness—comport w/ “substantial justice and fair play”
o
o
o
Determine whether assertion of PJ would comport w/ “fair play and substantial justice”
Relationship between defendant and forum state must be such that it is reasonable to
require corp to defend suit brought there.--Volkswagen
Burden is on Defendant to demonstrate that assertion of jurisdiction is unreasonable
 Reasonableness Factors in the Minimum Contacts Analysis: (started in
Worldwide Volkswagen, listed in Burger King, aka Asahi factors)
1. Burden on the Defendant—Pennoyer, Worldwide Volkswagen
2. Forum state’s interest in adjudicating the suit—McGee
3. Plaintiff’s interest in convenient and effective relief—McGee/WW Volkswagen
4. Interstate judicial system’s interest in efficient resolution—Worldwide Volkswagen
5. Shared interest of the several States in furthering fundamental social policies-Worldwide Volkswagen
Personal Jurisdiction Based on Internet Contacts
 Inset Systems Inc v Instruction Set—1996 –US District Ct for Dist of Conn
Facts: Inset (Conn) put a trademark on INSET and found out that Instruction Set (MA) was using
INSET.com and 1-800-INSET for customers to contact them. Both corps deal w/ computers. Trademark
infringement.

Rule: Two parts to establish minimum contacts:
1. PURPOSEFUL AVAILMENT: There must be some act where D purposefully avails itself
of the privilege of conducting activities w/ forum state, thus invoking protections and
benefits of the state.
o Ct found that Instruction Set purposefully availed itself to Conn b/c
advertising over the internet reaches every user in that State (potentially
10,000 in Conn)
 Advertisements over Internet available to users were continuous
2. FORESEEABILITY: Minimum contacts that it would reasonably anticipate being haled
into ct in State, however a lawsuit in forum state cannot offend traditional notions of
fair play and substantial justice (reasonableness factors)
o
Looked at REASONABLENESS FACTORS (Prong 2)--Ct concludes that the finding
of minimum contacts comports w/ notions of fair play and substantial justice
 Ct reasons that since distance between states is minimal— burden on
Defendant to dispute case in MA is minimal
 Ct reasons that present action concerns issues of Conn common and
statutory law—thus Conn has interest in adjudicating the dispute
 Zippo Manufacturing v Zippo Dot Com—1997—US Dist Ct for West Dist of PA
Facts: Zippo manufactors lighters in PA, Dot Com is internet site that sells subscriptions for internet news.
Dot com obtained exclusive right to use zippo domain names, however zippo has trademark.




Sup Ct noted in Burger King that jurisdiction could not be avoided ‘merely b/c defendant
did not physically enter the forum state.’
The test has always focused on the ‘nature and quality’ of the contact, not the quantity.
(International Shoe)
When defendant makes a conscious choice to conduct business w/ residents of forum
state, “it has clear notice that it is subject to suit there.” (Worldwide Volkswagon)
Used 2 Prong Test and found that PA had jurisdiction over Zippo Dot Com in CA
 Sliding Scale--The likelihood that PJ can be constitutionally exercised is directly proportionate
to the nature and quality of commercial activity that an entity conducts over the Internet.
 Active—Grounds for Personal Jurisd--Situations where defendant clearly does business
over internet—defendant enters into contracts w/ residents of foreign jurisdiction that
involve the knowing and repeated transmission of files over internet
 Passive—Not grounds to exercise Personal Jurisd--Situations where defendant simply
posts info over an internet web site which is accessible to foreign jurisdictions. A passive
web site does no more than make info available.
 Interactive—middle ground-- situations where websites are interactive w/ a user
exchanging info w/ the host computer. Must examine the level of interactivity and
commercial nature of exchange of info that occurs on web site.
o
II.
USSC has not addressed the issue of PJ over internet—Federal circuits have
largely embraced Zippo approach w/ slight modifications—most infuse scale w/
some requirement of intentional, forum-specific “targeting” or “express aiming”
Alternatives to Specific Jurisdiction
A.
General Jurisdiction—contacts unrelated to dispute
 GENERAL JURISDICTION:
Relevant for either resident or non-resident defendants (where specific juris only
relevant for non-resident D’s)
Defendant has “pervasive” (substantial) contacts with the forum state.
Allows the defendant to be sued for matters that DON’T relate to the contacts
Amount of contacts have to be more substantial b/c otherwise it would not comport
w/ fair play and substantial justice
Sliding scale—require the contacts to be more—to be substantial
 Perkins v Benguet Consolidated Mining Co—1952 (7 yrs after Intn’l Shoe--5 yrs before
McGee/Hanson)
Facts: Benguet’s operation was done in the Philippines, however when Japanese took over during
WWII the president moved back to OH and conducted business. Perkins, non-res of OH suing in OH
seeking dividends owed that were never paid. State of OH has nothing to do w/ dispute.
Issue: Whether Due Process Clause of 14th Amend precludes OH from subjecting a foreign
corp to the jurisdiction of its courts in an in personum action not related to OH.
 What standard does USSC use to establish general jurisdiction?
o Systematic and continuous contacts (like Internat’l Shoe)—not just any
minimum contacts
o Has to be substantial minimum contacts and substantial activity in the
state—require more contacts—
 Test is whether it is sufficiently substantial
 In this case, the president conducted meetings, sent correspondence,

o
maintained an office w/ files, used 3 bank accounts w/ company funds,
supervised policies and dispatched funds to Philippines—all from OH
Ct concluded that it would not violate federal due process for OH to take or
decline jurisdiction over the corp.
‘Due process is not offended by a State’s subjecting corp to its in personum
juris when there are sufficient contacts between State and foreign corp.’
Helicopteros Nacionales de Colombia v Hall—1984 (4 yrs after WW Volkswagen—1 yr before
Burger King)
Facts: Helico had contract w/ Peru/TX corp to provide helicopters for project. A helicopter crashed
killing 4 American’s who are trying to sue Helico in TX for wrongful death. USSC finds no general
jurisdiction for TX.




Perkins test applied and contacts were not sufficient
USSC asserts that Helico never authorized to do business, never had agent for
service of process, never sold product that reached, never solicited business, no
employee based there, never signed contract, and never performed helicopter
operations in TX.
However Helico’s chief exec officer made trip to TX once to negotiate contract and
the acceptance of TX checks from TX bank
 USSC Calls these facts “unilateral activity” and NOT continuous and
systematic general business contacts (established in Perkins)
Helico purchased tickets at regular intervals and sent pilots for training trips in TX

USSC sites Rosenberg (1923) and concludes that Rosenberg makes it clear
that purchases and related trips, standing alone, are not sufficient basis
for a State’s assertion of jurisdiction.
 (1 year later, USSC/Brennan finds they are sufficient basis for State’s
assertion of jurisdiction in Burger King).
 Justice Brennan dissents and focuses contacts on fact that Helicol purchased
helicopters and equipment, sent pilots and management for training, and
made negotiations for contract in TX.
o Brennan finds these contacts demonstrated Helicol’s purposeful
availment to TX and that Helicol’s contacts are directly related to the
underlying cause of action, thus making it reasonable to face
jurisdiction b/c not offending “fair play and substantial justice”
o Brennan thinks that specific jurisdiction could have been used.
General Jurisdiction: When defendants contacts w/ forum state are
 continuous and systematic and
 sufficiently substantial
B.
Power over Property


In Rem Jurisdiction—Exercise of jurisdiction over a thing, generally to establish title to that
thing—does not have to be real property—any use of the property or anything on the
property—(ex. Someone gets injured on property)
 ELEMENTS:
 Thing of value
 Within the forum state
 That the court properly attaches
 With proper notice to all potential claimants, and
 Due process requirements are met (generally easier than minimum contacts).
Quasi in Rem Jurisdiction--Use of judicial attachment of defendant’s property to obtain
defendant’s presence in court—piece of property used to satisfy a judgment against you
Ex: own piece of property in foreign state, get sued for breach of contract for
something in that state and lose, then court uses your property to satisfy the
judgment
 ELEMENTS:
 Thing of value
 Within the forum state
 That belongs to the defendant
 That the court properly attaches
 With proper notice to the defendant
 Shaffer v Heitner—1977
Facts: Heitner owns one share of stock in Greyhound Co. –a business incorporated under DE laws
w/ principal place of business in AZ. Individual D’s breached their fudiciary duties to Greyhound by
causing it to engage in actions that resulted in corp being held liable for substantial damages in
private antitrust suit.—These activities took place in OR. Heitner had stocks sequestered in DE and
D argues this violates due process.—Ct finds that appellants did not purposefully avail themselves
of privileges of conducting activity in forum state in way that would justify bringing them into DE ct.
 Property alone no longer sufficient for forum state to hold personal jurisdiction—there
must be minimum contacts to the forum state as well
 To justify exercise of jurisdiction in rem, basis for jurisdiction must be
sufficient to justify exercising “jurisdiction over the interests of persons in a
thing.”’ The standard for this is the minimum contacts standard
 In rem-- cases relating to the property in question-- unusual for State where property
is located not to have jurisdiction. In these cases, D’s claim to property located in
the State would normally indicate that he expected to benefit from the State’s
protection of his interest.
 Also the forum state’s strong interests in providing a procedure for peaceful
resolution of disputes over possession of property and the likelihood that the
records and witnesses would be in the forum state allow for jurisdiction
 Quasi-in rem—Ct finds that for cases where the property at issue is unrelated to the
cause of action, the presence of property alone would not support the State’s
jurisdiction. Other ties or minimum contacts must exist.
 All assertions of state-court juis must be evaluated according to standards set forth in
International Shoe and its progeny.
 Ct argues that by continuing to accept the assertion that jurisdiction over property is
anything BUT an assertion of jurisdiction over the owner of said property would
serve to allow state-court jurisdiction that is fundamentally unfair to defendant
 Justice Powell’s concurring opinion and agreement by Justice Stevens, raises the issue
that J Powell would reserve judgment on whether the ownership of some forms of
property, even w/out more (minimum contacts), would provide the contacts necessary to
subject D to forum state’s jurisdiction. Justice Stevens adding that USSC’s decision should
not be read to invalidate quasi in rem jurisdiction where real estate is involved.
In Rem Jurisdiction in Cybersquatting Cases
o
o
Anticybersquatting and Consumer Protection Act (ACPA) is a statute that provides that
trademark owners may initiate in rem civil actions against person registering their trademark as
a domain name in the district in which the domain name is registered. However, only if P is
unable to obtain PJ over violator
Jurisdiction in these cases would be in rem, based solely on presence of domain name
registration in forum State
C.
Transient Jurisdiction—Tag jurisdiction—served w subpoena while in forum state

Jurisdiction based solely on in-state service is constitutionally
valid.
But differing views on what standards to apply.
 Burnham v Superior Court—1990
Facts: Dennis Burnham married Francie, they moved to NJ where Dennis remained upon
separation. Francie moved to CA and filed divorce there. Served Dennis w/ summons while he
was in CA on business and visiting kids.

All Justices agreed that Due Process Clause generally permits state ct to exercise
juris over D if he is served w/ process while voluntarily present in State, but had
differing views--Plurality—doesn’t enjoy the precedential value of majority cases
 No precedential value
 4 said traditional method, 4 said minimum contacts, 1 said just easy
answer
o
Justice Scalia (joined by Rehnquist, Kennedy, and partially White)
 Jurisdiction based on physical presence alone constitutes due
process b/c it is one of the continuing traditions of our legal system
that define the due process standard of “traditional notions of fair play
and substantial justice.
 International Shoe confined minimum contacts to situations where
resident was not present in forum state and Scalia reasons that it
cannot be extended to those defendants w/ presence in state.
o
Justice Brennan (Marshall, Blackmun, O’Connor join opinion)
 Use International Shoe minimum contacts—like Shaffer showshistory can not be the decisive factor
 Mentions proposed revisions of Restatement of Conflict of Laws 28: a
state has power to exercise judicial juris over individual who is present
w/in its territory unless individual’s relationship to State is so
attenuated as to make the exercise of such jurisdiction unreasonable.
 By visiting forum State, transient D actually ‘avails himself of
significant benefits provided by state’ including health and safety, use
of police and fireman—therefore if he gets such benefits, he should
also be able to be hauled into ct
 Burdens on D are slight b/c D already visited forum State at least once,
when service was given, so he should be able to do it again

D.
Expressed Consent
1. Presence—Pennoyer
2. Consent—Pennoyer
Most states adopt Scalia’s point of view for tag jurisdiction—
presence is enough--Really depends on state’s long arm statute
a. Implied Consent—minimum contacts
b. EXPRESSED CONSENT—can serve to force P’s to litigate disputes in particular forum
 How do defendants ‘express consent’ to the court’s personal jurisdiction?
1. CONTRACT—provision w/in the contract itself that determines where litigation
will take place if disputes arise
 Carnival Cruise Lines Inc v Shute—1991
Facts: Shutes bought cruise ticket from travel agent in WA. Ticket had forumselection clause that stated all disputes arising would be litigated in FL. Mrs. Shute
got injured and tried to bring claim in WA.
o
Emphasize that forum-selection clauses contained in form passage
contracts are subject to judicial scrutiny for fundamental fairness

The Bremen (comparison case)— USSC addressed enforceability of a
forum-selection clause arising out of a contract negotiated by the two
business corporations.
o A freely negotiated private international agreement, unaffected
by fraud, undue influence, or overweening bargaining power,
should be given full effect.
USSC finds the Carnival contract to be a form contract—the terms of
which are not subject to negotiation
o Uses Bremen to determine case—no fraud used and Shutes given
opportunity to not participate in cruise

 Justice Stevens and Marshall dissent stating that only meticulous
passenger would read contract which they would not get until they
purchased ticket and could not return since contract does not allow
for refund.
State Domestication Statutes
 Pennoyer indicated that corps could be made to consent to jurisdiction
as a condition of doing business w/in state
 If State requires corp to appoint an agent for service of process w/in
state: some states uphold jurisdiction over corp in disputes both related
and unrelated to activity in forum; other states do not
Consent by Estoppel: consent occurs when defendant is non-cooperative in
court’s effort to determine whether PJ exists—default consent
Forum-Selection vs Choice-of-Law Clauses
 Forum-Selection Clauses: identify the court in which disputes arising
under the contract must be litigated, serving to prevent personal
jurisdiction challenges when the clause is upheld
 Choice-of-Law Clauses: identify the law that will govern disputes arising
under the contract and say nothing about the forum in which such a
dispute must be litigated.
2. Waiver –FRCP 12(h) (later)
o
o
a.
b.
Must raise it in first response of pleading Or file special appearance
Collateral attack –you don’t appear and the other sides wins and you collaterally
attack judgment that is being enforced on you
 If you lose and they find that they had PJ, you don’t get to re-litigate case on
merits—judgment stands.
Ex: If P files a claim against Continental Airlines in DE and Continental (defendant)
does not bring up the contract that states all disputes are litigated in TX, then they
have waived their consent to DE’s jurisdiction
Note for the Future: FRCP 12(h) & WAIVER
i. Defendant can waive a defense of lack of personal jurisdiction (just like a
defendant can consent from the outset).
ii. Basically, the defendant has to raise the defense in the first responsive motion
or pleading that the defendant files.
3. Counterclaims (later)
E.
Personal Jurisdiction in Federal Courts
Federal Rule of Civil Procedure 4(k)—4K helps you along the way!
o
FRCP 4(k)(1): Service of summons or waiver of service establishes juris over a D:
(A) Who could be subjected to jurisdiction in a state court (hence the relevance of
state long-arm statutes) Look to state’s long arm statute to determine it’s
jurisdiction over a Def and apply it to federal court located in that state.
(B) Who is joined under Rule 14 or 19 (later) and is served within 100 miles of the
place where the summons issues,
(C) Who is subject to federal statutory interpleader jurisdiction (later), OR
(D) If a federal statute authorizes such jurisdiction
o Federal statutory Authorization:--indicates federal statutes that permit
federal courts to exercise PJ on a nationwide or sometimes worldwide
basis rather than based on forum state contacts
o
FRCP 4(k)(2)
 IF the exercise of jurisdiction is consistent with the Constitution and laws of
the United States, Serving a summons or filing a waiver of service is effective
to establish personal jurisdiction over a defendant who is not subject to the
general jurisdiction of ANY state court,SO LONG AS the claim arises under
federal law
 applies to situations where defendant has minimum contacts w/ all of US but
no state in particular—can only be used for federal law claims and only
available when no state can exercise PJ
F.
Constitutional Notice Requirement



Jurisdiction over the Person or Thing
o In personam jurisdiction
 FRCP 4K
 Long arm statute
o Constitutional due process requires establishment of:
 Minimum contacts
 NOTICE—must be ‘reasonably calculated under all circumstances’
 Actual notice—door to door one end of spectrum
 Constructive notice—newspaper publication at other end of spectrum
Other states not obliged to give full faith and credit if proper notice is not given b/c it
violates due process.
Two elements necessary to exercise Personal Jurisdiction
o Ct have proper statutory and constitutional authority
o Defendant must receive adequate notice of pendency of the proceedings leading
to that judgment


Whether notice is adequate is primarily matter of federal constitutional law,
however must also comply w/ any applicable state statutory provisions
governing notice
Constitutional notice requirement found in Due Process Clause of 14th and 5th Amendment.
Federal Ct statutory notice requirement found in FRCP Rule 4
 Mullane v Central Hanover Bank & Trust—1950
Facts: NY has provisions for beneficiaries when trustee is going to do something w/ money—4
successive weeks of publication in local newspaper where the trust is. Hanover notified beneficiaries by
publishing, however Vaughn, on behalf of beneficiaries, argues that service was inadequate and violated
due process.

Legal Standard: Fundamental requirement of due process in any proceeding to be
given finality is notice reasonably calculated, under all circumstances, to
apprise/inform interested parties of the pendency of the action and afford them an
opportunity to present their objections.
 The fundamental requisite of due process of law is the opportunity to be
heard. This is of little worth if one is not informed of the pending matter
to choose for himself whether to appear or default
 Notice must reasonably convey required info and afford reasonable time
for interested parties to appear
 There does not have to be personal notice, but has to be reasonably
calculated to notify the parties—at the time of this case, mailing
notification was reasonable to parties w/ known addresses, and
publication was reasonable for those w/ unknown names and addresses
 Property cannot be subjected to court’s judgment unless reasonable and
appropriate efforts have been made to give property owners actual notice
of action.
 Dusenbery v United States—2002 –Chief Justice Rehnquist
Facts: FBI, following the Controlled Substance Act, sent certified letters to penitentiary where
Dusenbery was regarding the forfeiture of his cash and car. Dusenbery argued that he never
received the notice and that ‘actual notice’ was required.



Ct asks if notice in this case was “reasonably calculated under all circumstances to
inform Dusenbery of the pending cash forfeiture.”
Due process clause only requires the Government’s effort to be “reasonably
calculated” to inform the interested party and USSC feels that FBI did meet this
standard by sending certified mail
USSC notes that their cases have never required “actual notice”—notice by
certified mail satisfies due process.
 Justice Ginsburg, Stevens, Souter and Breyer dissent
 Fundamental requisite of due process of law is opportunity to be heard.
A person cannot be heard unless he is informed of the pending matter
and can himself choose whether to appear or default
 Government accepts a procedure for notification that is too lax to reliably
ensure that prisoner will receive a legal notice sent to him –Have inmate
sign the log that he received the letter
 Jones v Flowers—2006—Chief Justice Roberts
Facts: Jones bought house in AR, stopped paying taxes once mortgage was paid in full putting house
in delinquency. Commissioner of State Lands tried to notify Jones by certified mail to the house
(where he no longer lived), but letter was returned. Commissioner did nothing else to notify Jones.

Differs from Mullane and Dusenbery b/c here Gov. was aware that notice had not
been received.
o Whether Gov’s knowledge is a “circumstance and condition” that varies
the “notice required.”

Ct does not think that a person “desirous of actually informing” the interested
parties would stop and do nothing when informed that notice failed and certified
letter was returned unclaimed.

Failure to follow up would be unreasonable, even though letters reasonably
calculated to reach the intended recipients—State should have taken reasonable
steps to notify Jones if practicable to do
 Justices Thomas, Scalia, and Kennedy dissent
o Unclaimed letter was returned after post office made 3 attempts
to deliver it
o AR exceeding constitutional minimum by additionally publishing
the notice in the newspaper
o Due process requires nothing more
Important to note that it is clear from Jones that USSC is moving to a more
broad view of Mullane notice requirement and has not moved further in the
narrow view suggested in Dusenbery
Subject Matter Jurisdiction
2. Subject Matter Jurisdiction—jurisdiction over the nature of the case and type of relief sought
State courts: mainly cts of general jurisdiction that can hear cases involving any subject even most
matters arising under federal law.
Federal courts: cts of limited jurisdiction—jurisdiction confined to particular type of case or that may
be exercised only under statutory limits
REMEMBER: Under Article III of the U.S. Constitution, federal courts are courts of limited
jurisdiction—authorizes federal jurisdiction for US Supreme Court.
 Lower federal courts are created by Congress through statute—Title 28 of U.S. Code
o Congress has never given those courts the full range of their potential Article III
subject matter jurisdiction.
 Because SMJ goes to the court’s competence to hear the case, it can always be challenged, at any
stage of the litigation.
Major Sources of Federal Court Subject Matter Jurisdiction
o 28 U.S.C. §1331: Federal Question Jurisdiction
o 28 U.S.C. §1332: Diversity Jurisdiction
o 28 U.S.C. §§1441-1445: Removal Jurisdiction
o 28 U.S.C. §1367: Supplemental Jurisdiction
1. Diversity Jurisdiction Basics
 PURPOSE: To give parties from different jurisdictions a “neutral” forum
o even though federal court still uses the states’ law where it is found—sometimes the jury in
federal court will be less malleable than state courts and federal judge is not necessarily
invested in the State since he is appointed by President and not elected
 Burden of proving that case is properly in federal court is on the person who is trying to invoke
the federal jurisdiction
Section 1332(a)—Congress gave federal cts jurisdiction over state lawsuits through the federal
diversity statute.
 The district courts have original jurisdiction over all actions where: (both conditions must be
met)
1. The amount in controversy—damages claimed or relief demanded by injured party—
exceeds $75,000 (exclusive of interest and costs) AND
2. Diversity of citizenship—The lawsuit is between:
a. Citizens of different States;
b. Citizens of a State and citizens or subjects of a foreign state;
c. Citizens of different states and in which citizens or subjects of foreign states are
additional parties; OR
d. A foreign state as plaintiff and citizens of a State or different States
An alien admitted to the US for permanent residence shall be deemed a
citizen of the State in which such alien is domiciled.
To be a citizen of a State a natural person must be 1) a citizen of US and 2) a
domiciliary of that State
Citizenship vs. Domicile vs. Residence
• Citizenship most properly refers to a person’s national citizenship.
o Foreign citizens are generally not citizens of any state for diversity purposes, but
section 1332 directly allows for diversity jurisdiction when there are parties who are
citizens of foreign countries.
o If all parties are U.S. citizens, national citizenship has no bearing on diversity
jurisdiction.
•
Domicile is the status used to determine diversity among parties in federal court.
o Physical residence in a state, PLUS
o Intent to remain there indefinitely.
o ONLY ONE DOMICILE AT A TIME!
•
Residence refers to where you happen to be living at the moment, which may or may not
be your domicile.
o Special Cases: Students, military
Diversity of Citizenship
 Mas v Perry—1974 –US Ct of Appeals for 5th Circuit
Facts: Mas’s were grad students in Louisiana. Rented apartment from Perry that had 2-way mirror.
Sued Perry in federal court. Diversity jurisdiction debated. Mr. Mas was citizen of France, Mrs. Mas
was domiciled in Mississippi and Perry was domiciled in Louisiana.

For diversity purposes citizenship means domicile—mere residence in State is not
sufficient
 Domicile=place of “true, fixed, and permanent home and principal
establishment to which he has intention of returning whenever absent from

Change of Domicile can occur only by combination of
A. Taking up residence in a different domicile with
B. The intention to remain there

Rule that COMPLETE DIVERSITY—all P’s must have different citizenship from all D’s—is
required for federal jurisdiction-- Strawbridge v Curtiss (Justice Marshall)
o This rule is controlled by federal law not state law

Time-of-Filing Rule—Diverse citizenship must be present at time complaint is filed for
federal jurisdiction. If any party’s citizenship changes throughout the trial it is
irrelevant as long as it was diverse at initiation of lawsuit

Usually domicile of wife is deemed to be that of her husband—however there are
exceptions to this where it would be unreasonable for it to occur (this case was one)
 §1332(c): Special Rules for Diversity “Citizenship”
•
A CORPORATION is a citizen of:
o The state in which it is incorporated, AND
o The state where it has its principal place of business.
o Principal place may be determined by 3 tests:
 Nerve center test—locus of corp decision-making authority
 Corporate activity test—location of corp production or service activity
 Total Activity test—hybrid of previous 2 approaches
•
An UNINCORPORATED ENTITY is a citizen of every state where one of its members is
domiciled. (ex. Law firms, labor unions)
•
An INSURANCE COMPANY is a citizen of:
o The state of which the insured is a citizen,
o The state of its incorporation, if any, AND
o The state where it has its principal place of business.
•
A LEGAL REPRESENTATIVE:
o Of a decedent’s estate is deemed a citizen of the state where the decedent was a
citizen.
o Of an infant or incompetent is deemed a citizen of the state where the infant or
incompetent is a citizen.

CLASS ACTION—only the citizenship of the named class of representatives are considered.
Unnamed class members not considered.

The Bizarre Situation: An American Citizen Domiciled Abroad
o NOT a citizen or subject of a foreign state
o NOT domiciled in a U.S. state, so not a citizen of any state for purposes of 1332
o THEREFORE: Cannot sue or be sued in federal court based on diversity jurisdiction
grounds
Article III of Constitution extends judicial power over controversies between citizens of different
states, etc. (See 28USC 1332)
o Article III only requires minimal diversity (diversity of citizenship between any 2 parties
on opposite side of an action regardless if other parties may be co-citizens.)
o However Congress has never granted this and instead requires complete diversity
 Complete Diversity—found in 28 USC 1332—where citizens of same state appear on both sides of
a dispute, diversity juris unavailable
 Minimal Diversity—Article III permits the extension of federal juris to cases where parties from
same state are on both sides of dispute as long as there are adverse parties who are not cocitizens
Exceptions to Diversity
A. Domestic Relations exception—federal courts may not hear divorce, spousal support or child
custody cases
B. Probate Matters Exception—federal ct may not participate in cases regarding probation or
annulments of wills or administration of estates or disposal of property
ALIENAGE JURISDICTION—28 USC 1332 provides jurisdiction for suits involving aliens when the action
involves:
 “citizens of a State and citizens or subjects of a foreign state” or
 “citizens of different States and in which citizens or subjects of a foreign state are additional parties”
 Permanent resident aliens are treated as citizens of the State where they are domiciled.
Parties
Pv +French cit V. Dny +German cit
Pc V. German Citizen
French citizen V. Pny
Pny V. Pv +German citizen
French Citizen V. German Citizen
French Citizen V. Dny +German Citizen
Pv +French citizen V. Dny + French Citizen
Jurisdiction?
YES
YES
YES
YES
NO
NO
YES
Code
1332(a)(3)
1332(a)(2)
1332(a)(2)
1332(a)(3)
----1332(a)(3)
 Saadeh v Farouki—1997 US Ct of Appeals for DC
Facts: Saadeh is a citizen of Greece, Mr. Farouki is citizen of Jordan, Mrs. Farouki was citizen of Egypt. Farouki’s
became permanent residents of MD. Saadeh sued Farouki’s and their businesses for breach of contract. Sole
basis of jurisdiction alleged in Saadeh’s complaint was diversity of citizenship.
Issue: Whether the 1988 amendment to the diversity statute 28 USC 1332 allows for complete jurisdiction over a
non-resident alien against a resident alien.

1988 Congress amended diversity statute adding “an alien admitted to US for permanent
residence shall be deemed a citizen of the State in which such alien is domiciled.”
 Constitution Article III, Sect 2 gives authority for US citizen to sue foreign national, but
Constitution does not allow for 2 foreign nationals to sue each other so by allowing
this lawsuit that statute would be unconstitutional
 Ct feels that a literal reading of 1988 amendment would produce odd unconstitutional
result

Upon research, Ct believes that the Congressional intent of amendment was to ‘reduce
diversity jurisdiction through alienage provision’ by treating a permanent resident alien as a
citizen of the State of his domicile
 Purpose was so that lawsuits arising between citizen of State and permanent resident
alien could be handled in State court

Ct believes it is illogical that Congress intended to eliminate diversity juris in cases between
citizen and permanent alien resident, YET intended to expand diversity juris in cases between
alien permanently residing in one state AND alien permanently residing in another state
 Amendment was not intended to create diversity jurisdiction (between permanent
alien residents) where it didn’t already exist
 USSC has never addressed scope of complete diversity rule in cases involving alien
parties
Amount-in-Controversy Requirement—must EXCEED $75,000



Amount claimed must be in good faith
Must appear to a “legal certainty” that the claim is for jurisdictionally sufficient amount
Section 1332(b): Amount in Controversy
o Generally judged by the plaintiff’s COMPLAINT
o BUT, if the plaintiff recovers less than $75,000, the district court can:–Deny costs to
the plaintiff, AND–Impose costs on the plaintiff.
Del Vecchio v Conseco Inc—2000—US Ct of Appeals 7th Circuit
Facts: Del Vecchio trying to get a class action suit for bank fraud. Vecchio owned $5000 life insurance
policy and traded it in for $10,000 policy which he thought was free trade. When Vecchio found out it
was not he sued in district ct for fraud. Vecchio lost and appealed stating that his punitive damages
(since he can’t aggregate the amounts) would exceed $75,000. Both Del Vecchio and Conseco agree
that there is jurisdiction b/c amt in controversy would be satisfied.


Both nominal and punitive damages may be taken into account in determining proper
amount in controversy
2 part inquiry necessary where punitive damages are needed/required to satisfy
jurisdictional amount ($75,000):
1. Whether punitive damages are recoverable as a matter of state law?
2. If Yes: court has subject matter jurisdiction unless it is clear “beyond a legal
certainty” that P would under no circumstances be entitled to recover the
jurisdictional amount.
o Generally give P’s the benefit of the doubt in these matters, but a
complaint will be dismissed if it “appears to a legal certainty that the
claim is really for less than the jurisdictional amount ($75,000)
 Anti-aggregation Rule (recognized by Synder Court)—where there is one piece of
property (res) such as an estate, where it is then proper to consider the value of
the entire res for jurisdiction purposes. Even if several P’s have claim to the res,
the recovery is for the whole res which would then be divided.---(Not the case in
this Del Vecchio case)
Aggregation Rules
Single Plaintiffs may aggregate claims (related
or unrelated against a single defendant
P (Claim 1 + Claim 2) V. D = YES
Single Plaintiffs may not aggregate claims
against multiple defendants unless asserting
joint liability
Multiple plaintiffs may aggregate claims only if
they are based on a common undivided
interest (CUI)
(replace one P with the other P and it wouldn’t
make a change in the claim = CUI)
Multiple plaintiffs may not aggregate separate
and distinct claims to reach the jurisdictional
amount, even if factually related
P (Claim 1) v D1 + P (Claim 2) v D2 = NO
P (Joint Liability Claim) v D1 + D2 = YES
(but alternative claims don’t count twice!)
(P1 + P2)(Claim 1) v D = YES
P1 (Claim 1) + P2 (Claim 2) v D = NO
(Del Vecchio—b/c common interest is fraud so
although factually related, they are separate and
distinct claims)
Federal Question Jurisdiction—the authority of federal courts to hear cases involving federal
constitutional, statutory, or treaty law.



Article III, Sect 2 extends judicial power to “all cases in Law and Equity, arising under this
Constitution, the Laws of the US, and Treaties…”
The congressional grant of authority for federal question jurisdiction is found in 28 USC
1331: “The district courts shall have original jurisdiction of all civil actions arising under
the constitution, laws or treaties of the United States.”
TWO-PART TEST:
o A pivotal and substantial (not frivolous) federal element,
o That is part of the plaintiff’s well-pleaded complaint.
 Osborn v Bank of the United States—1824 –Justice Marshall
Facts: Bank of US sued in federal court to obtain an injunction restraining an OH state official (Osborn)
from collecting a tax on the Bank that Bank felt was unconstitutional. Federal statute creating the
Bank authorized federal jurisdiction in all cases involving the Bank.


Foundation case for federal question jurisdiction
Justice Marshall—early decision in our country—Sup Ct trying to figure out its role—
interpreting constitution very narrowly in this case

J Marshall—under Article III Congress may confer jurisdiction whenever a federal question
forms an “ingredient” of the claim.

The “arising under” clause of Article III interpreted by Osborn Ct gives Congress the
flexibility to confer federal question jurisdiction “whenever there exists in the background
some federal proposition that might be challenged, despite the remoteness of the
likelihood of actual presentation of such a federal question.
o This is an interpretation of the scope and meaning of Article III, not of the actual
legislation conferring jurisdiction on the federal courts.

J Marshall states that the Osborn case arises under the law. The act of Congress is its
foundation and contract could not have been made except under the authority of that act.
o The congressional act is the first ‘ingredient’ in the case, is the origin of the case,
and is that which every other part of the case arises.
 Louisville & Nashville Railroad Co v. Mottley—1908
Facts: While passengers on railroad the Mottley’s were injured on company’s negligence. Railroad made
agreement that they would get 2 lifetime passes expressed in a contract. Mottley’s received tickets until
1907 when Railroad declined to renew passes based on act of Congress in 1906 that forbid the giving of
free passes. Mottley’s arguing a breach of contract which is usually under state law and does not raise a
federal question.

Well-pleaded Complaint Rule—to qualify for statutory federal question jurisdiction
the presence of a federal question must appear in P’s presentation of case in the
context of a “well-pleaded” complaint—one that limits itself to a statement of its own
cause of action.
o Well-pleaded Complaint Rule asks whether P’s cause of action arises under the
federal Constitution or laws of US or treaties

Plaintiffs original cause of action must arise under the Constitution

A “suit arises under the Constitution” only when P’s statement of his own cause of
action shows that it is based on those laws or that Constitution.
o Federal questions appearing only as defenses raised in response to complaint
will not be sufficient enough to warrant federal question jurisdiction
o Allegations in P’s original complaint that anticipate potential federal law
defenses will NOT warrant federal question jurisdiction
Most Common Formulation of the Well-Pleaded Complaint Rule
“A right or immunity created by the Constitution or laws of the United States must be an
element, and an essential one, of the plaintiff’s cause of action. The right or immunity must be
such that it will be supported if the Constitution or laws of the United States are given one
construction or effect, and defeated if they receive another.”
 Master-of-Complaint Rule—USSC has emphasized that well-pleaded complaint rule
“makes the plaintiff the master of the claim, he or she may avoid fed juris by exclusive
reliance on state law
 Counterclaims—USSC has held that the presentation of fed questions in counterclaims
asserted in response to initial complaint WILL NOT support federal question
jurisdiction
 Grable & Sons Metal Products, Inc. v Darue Engineering & Manufacturing—2005
Facts: In 1994 the IRS seized Michigan real property belonging to Grable to satisfy Grable’s federal tax
delinquency. Title 26 USC 6335 required IRS to give notice of seizure which they did by certified mail. IRS sold
property to Darue and gave him a quietclaim deed. 5 yrs later Grable brought quiet title action in state court
claiming Darue’s title was invalid b/c IRS did not notify Grable correctly. According to the statute, they were
supposed to notify them in person, not by mail.


Action for quiet title is state law so how do we reach conclusion that there is fed. Juris?
Two prong test
o Need a substantial federal question embedded in the state law—there is no quiet title
action if there is no proper notice
o Whether it would upset notions of state soveirgnty—don’t want federal gov’t making
decisions regarding state issues

Another longstanding variety of federal “arising under” juris that in certain cases fed question
juris will lie over state-law claims that implicate significant federal issues.—Turn on substantial
questions of federal law
o Smith v Kansas City Title—Mo law provided cause of action but principal issue was
federal constitutionality of bond issue. “appears from complaint that right to relief
depends on construction or application of federal law.”
o Merrell Dow—read in its entirety as treating the absence of a federal private right of
action as evidence relevant to but not dispositive of, the ‘sensitive judgments about
congressional intent’ that 1331 requires.

Darue removed case to Federal Ct b/c claim of title depended on interpretation of notice
statute in federal tax law.
Holding: The nat’l interest in providing a federal forum for federal tax litigation is sufficiently
substantial to support the exercise of federal question jurisdiction over the disputed issue on
removal
ONE EXCEPTION to jurisdiction that doesn’t involve fed question plead in complaint is when a
federal question provides an essential ingredient to resolving the state law claim that is in
federal ct—Justice Souter states this is a fact based question
Justice Thomas—shouldn’t have facts—should keep w/ well-pleading complaint rule



“ARISING UNDER”
 American Well Works(1916): “A suit arises under the law that creates the cause of action.”
 Smith(1921): Fed Question exists if P’s claim depends on a question of federal law
 Merrill Dow(1986): No fed Question if relevant federal law does not provide a right of action
1. Jurisdiction Over the Person or Thing
A. Presence
B. Consent
1. Minimum contacts
a. Purposeful availment
b. Foreseeability
c. Reasonableness factors
2. Notice—reasonably calculated under all circumstances to apprise D of pending litigation
2. Subject Matter Jurisdiction
A. Diversity Jurisdiction
 Complete Diversity
• Amount in Controversy
B. Federal Question Jurisdiction
 Well-Pleaded Complaint Rule
• Essential Federal Element
C. Supplemental Jurisdiction
D. Removal Jurisdiction
3. Venue