Kent's Civ Pro II _Odgen_

CIVIL PROCEDURE OUTLINE I. CLAIM PRECLUSION (Res Judicata) Claim Preclusion/res judicata is an affirmative defense (must be plead or will be lost) that bars parties from litigating a 2 nd time claims that have already been litigated. This ensures efficiency (preserves judicial resources) and consistency (protects judgments and allows for reliability). The elements are: final judgment, on the merits, same claim (split in juris between the same cause of action test (aka primary right test in CA) and same transaction or occurrence test (which is most used)), and same parties. Elements 1. Final judgment (focus on 1st suit): 2. On the merits (focus on 1st): 3. Same claim (the claims must be the same in 1st and 2nd suits (focus on 2nd suit): A. Same cause of action test B. Same transaction or occurrence test (notice pleading) (most used today) 4. Same parties-the parties in the 2nd action must be the same as those in the first (or have been represented by a party to the prior action (had privity with them)) (focus on 2nd suit) a. b. An affirmative defense (which must be plead or it will be lost) that bars parties from litigating a 2 nd time claims or issues that have already been litigated Elements (final judgment, on the merits, same claim, same parties) i. There must be a final judgment (focus on 1st suit) 1. When do we have a final judgment? a. Full trial and appeals exhausted b. If no appeal, then when trial ct has completed its work 2. How do we deal with appeals? There is a Split: a. In some jurisdiction, the judgment is FINAL, even as appeal is pending, so another suit is barred by res judicata (restatement view) b. In some jurisdiction, the judgment is NOT FINAL while appeal is pending (so this suspends the preclusion, and a further suit is not barred by res judicata) ii. The judgment must be on the merits (focus on 1st suit) 1. Is this on the merits? a. Full jury trial-yes b. Directed verdict-yes c. Summary judgment-yes d. 12b6 (failure to state a claim)- yes (the person had leave to amend, and blew it, so the case is dismissed on the merits) or no (the person had leave to amend, so it wasn‟t decided on the merit) e. 12b2(lack of jurisdiction over the person)-no, this just decides jurisdiction, no merit of case) f. Dismissal for failure to prosecute (Rule 41) i. With prejudice- yes ii. Without prejudice-NO iii. Same claim (the claims must be the same in 1st and 2nd suits (focus on 2nd suit) 1. Same writ test (common law), OR a. What was pled in 1st suit can‟t be pled in 2nd (not used today)(narrowest view) 2. Same cause of action test, OR a. Called primary right test in CA i. Broader than same writ test, but narrower than same transaction test ii. You could plead a contract issue in a separate case from a tort issue 1. a.k.a. common core of operative facts test, or 2. Same evidence test b. Same Cause of Action Test example i. Mycogen case 1. Licensing agreement/ breach of K. Mycogen was trying to enforce their same basic rights in both cases, and the rights were those of the K, and its subsequent breach 2. LS#1- breach of K/declaration a. They asked for declaratory relief plus specific performance 3. LS#2- breach of K/ damages 4. LS#2 same claim as LS#1, therefore preclusion applies 5. If you just ask for declaratory relief alone, then you can sue for other remedies later on, your claim is not barred by res judicata a. However, Mycogen asked for declaratory relief plus specific performance, so they were barred by res judicata 1 c. Same transaction or occurrence test (notice pleading) (most used today) a. Same events b. Same facts c. Similar evidence d. Related remedies i. Restatement 2nd 1. A party who has asserted a right to relief arising out of a particular transaction or occurrence must join all claims she has arising from it, or the omitted claims will be barred by res judicata a. Preclusion turns on the right to join the claim in the original action, not on whether the claim actually was asserted i. Broadest ii. Simply put, claim= all rights arising out of a single transaction iv. Same parties -the parties in the 2nd action must be the same as those in the first (or have been represented by a party to the prior action (had privity with them)) (focus on 2nd suit) 1. Each P has a separate claim, 2. Each D has separate defenses, 3. Each P & D has an individual right to a day in court (due process of law) Examples of Suits presenting the same claim i. Efficiency (preserves judicial resources) 1. Encourages plaintiffs to bring all claims resulting from a single transaction at one time. 2. Frier v. Vandalia- Car owner brought civil rights action claiming that city denied him due process in towing his four cars. US District Court dismissed, and owner appealed. Held that car owner, who had brought replevin action in state court alleging that two cars were towed without lawful process (where he lost), was barred, under doctrine of claim preclusion, from bringing civil rights action in 2 nd suit. 2nd suit was an action for due process (notice and right to a hearing) under § 1983. However, the court said that this claim should have been brought up in first suit and was barred under res judicata (claim preclusion). Court said the causes of action are identical since the evidence necessary to sustain a 2nd verdict would sustain the first, i.e., where the causes of action are based upon a common core of operative facts. This test is a mix between the same cause of action test and same transaction test above. 3. Ways you CAN NOT split a. Different theories of recovery i. Ex. Contracts and torts b. Arithmetical splitting i. Ex. plaintiff tries to recover for separate damages from the same incident in separate actions (i.e. cannot seek damages for a broken hand in one action and a broken foot in another if they occurred in same accident) c. Splitting of relief- different types of damages in different actions i. Splits claims into different remedies ii. Replevin in one action and then constitutional theories in another iii. Personal injuries in 1 case and property damage in another from same accident 4. General rule is plaintiff must recover all damages in the original suit including all future damages that are likely to ensue. ii. Consistency 1. We want to protect judgments 2. We want the existing judgments to be reliable, consistent 3. Claim preclusion promotes consistency by disallowing one claim to be resolved by 2 courts in 2 different ways 4. Matino v. McDonalds- Action was brought challenging provision of franchise agreement prohibiting acquisition of financial interest in competing self- service food establishments without consent of franchisor. Dist Ct granted D's motion for summary judgment and plaintiffs appealed. Ct of Appeals held that: (1) claims coming within the definition of "compulsory counterclaim" are lost if not raised at the proper time; (2) compulsory counterclaim rule (13a) did not bar subsequent action claiming violation of antitrust laws where no pleading was filed in the prior action resulting in consent judgment; (3) the principle of res judicata treats a judgment on the merits as an absolute bar to every litigation between the parties and those in privity with them of every matter offered and received to sustain or defeat the claim or demand and to every matter which might have been received for that purpose; (4) if consent decree is expressly entered without prejudice or reserving rights the decree will not have preclusive effect, and (5) consent judgment in franchisor's action to terminate franchise for 3. 2 d. violation of the agreement was res judicata precluding the franchisee from thereafter claiming that the franchisor's action violated the antitrust laws. a. Law suit 1- consent decree for breach of K claim b. Law suit 2- anti trust case under the Sherman Act c. Rule 13a Compulsory Counterclaims i. If same transaction or occurrence, then the counterclaim must be filed, or the claim is waived 1. Here, Matino didn‟t file his counterclaim and argue that the Sherman Act was violated, therefore he loses this right under claim preclusion. ii. Court ruled Rule 13a didn‟t apply here. d. However, the court said the claim did arise out of the same transaction, and that the prosecution of the 2nd claim would nullify rights established by the prior action iii. Every potential plaintiff who suffers an injury from the same transaction or occurrence has their own claim for res purposes, i.e. Pl is master of his claim iv. Also, if an action is brought in state court, and there is another claim arising out of the same transaction or occurrence that can only be brought in fed court, and then the state claim is over, the pl can then bring his fed claim in fed court and it is not barred res judicata 1. A pl can bring state claims in state court & not lose related claims within exclusive fed jurisdiction v. If fed claim is 1st brought in fed court, the pl must assert his state claim under supp jurisdiction 1367. If court doesn‟t grant jurisdiction, then he may later bring the claim in state court. If he doesn‟t raise supp. jurisdiction, or is granted supp jurisdiction, then he is barred res judicata in the state courts vi. Note: plaintiffs don‟t have right to have their tort cases decided under the inconsistent tort laws of 2 different states. Once you pick a state, you have to stick with it Examples of Suits between the same parties i. Claim preclusion can only be asserted against a person or entity who was a party or in privity with a party in a prior suit 1. A person is in privity with another when he is so identified in interest with another that he represents the same legal right as that other person; privity means one whose interest has been legally represented at the time ii. Searle case 1. LS#1- husband v. wife. Property awarded to wife. 2. LS#2- sons v. wife. Sons not bound by prior judgment a. Court said the sons had no privity, so were therefore not barred by res judicata b. Rule: if you are not named and served, or adequately represented in the suit, then you are not barred by res judicata to further suit 3. Various types of privity relationships: a. Substantive legal relationships: i. Successive owners of property are in privity and are bound by easements b. The trustee of an estate or interest of which the person is a beneficiary c. A person who is invested by the person with authority to represent him in an action d. The executor, administrator, guardian conservator, or similar fiduciary manager of an interest of which the person is a beneficiary e. An official or agency invested by law with authority to represent the person‟s interest f. The representative of a class of persons similarly situated, designated as such with the approval of the court, of which the person is a member i. A person represented by a party to an action is bound by the judgment even though the person himself does not have notice of the action, is not served with process, or is not subject to service of process iii. Claim preclusion exceptions- a judgment for D is not a bar to Pl filing a 2nd action on the same claim under the appropriate circumstances: 1. Exception for lack of SMJ a. A court must have jurisdiction over a matter to render a final judgment on the merits for the purpose of claim preclusion. b. Gargallo case- A final judgment by a state court upon a course of action over which the adjudicating court had no SMJ does not have claim preclusive effect in any subsequent proceedings i. Use of state preclusion law- same Transaction test ii. Lack of SMJ exception to Claim Preclusion 1. The state court lacked SMJ on this type of claim, so the claim could not be precluded a. These types of claims (securities laws) could only be filed in fed ct 3 2. When a judgment is one of dismissal for lack of jurisdiction, for improper venue, or for nonjoinder or misjoinder of parties, or 3. When P agrees to or elects a nonsuit or voluntary dismissal w/o prejudice or the court directs that the Pl be nonsuited w/o prejudice, or 4. When by statute or rule of court the judgment does not operate as a bar to another action on the same claim, or 5. When the parties have agreed in terms or in effect that the pl may split his claim, or 6. The court in the 1st action has expressly reserved the pl’s right to maintain the 2 nd action, or 7. Jurisdictional rules disallowed a party from seeking certain forms of relief, or 8. The judgment in the 1st action was plainly inconsistent with the fair and equitable implementation of a statutory or constitutional scheme, or it is the sense of the scheme that the pl should be permitted to split his claim, or 9. For reasons of substantive policy in a case involving a continuing or recurrent wrong, the pl is given an option to sue once for the total harm, both past and future, or to sue from time to time for the damages incurred to the date of the suit, and he chooses the later course, or 10. It is clearly and convincingly shown that the policies favoring preclusion of a 2 nd action are overcome for an extraordinary reason, or 11. The pl proposes to rely in the 2nd action on evidence that he failed to present in the 1st action b/c of the D‟s fraud, concealment, or misrepresentation. II. ISSUE PRECLUSION (collateral estoppel) Issue preclusion prohibits a party from putting in issue in subsequent suit facts or questions determined and adjudicated in an earlier case. Issue preclusion does not affect issues or defenses that could have been raised in the 1 st suit but were not. The elements are: final judgment, on the merits, same parties (except non-mutual preclusion (NMP) or privity), and same issue which was actually litigated and determined essential to the judgment (to determine if essential, ask if the losing party has an incentive to appeal on that issue). NMP allows a new party to invoke issue preclusion against a party who litigated and lost an issue in a prior action. Defensive NMP occurs when a D seeks to prevent a pl from asserting a claim the pl has previously had a full and fair opportunity to litigate and lost against another D. Offensive NMP involves a new pl who seeks to borrow a finding from a prior action to impose liability on a party who was a D who lost in the prior action. Offensive NMP is discretionary, and the factors courts use to determine whether to apply it are: 1-If Pl2 could have joined LS#1, and didn’t, then the court may not apply offensive NMP 2-Did D have incentives to litigate in LS#1? If no, then the court may not apply offensive NMP -Not much was at stake in LS#1, the damages were small, so court may not apply offensive NMP, since D did not fight too hard in LS#1 b/c they wouldn’t lose that much money 3-Are there inconsistent judgments? If yes, then the court may not apply offensive NMP -Several judgments that have different outcomes 4-Did D lacks sufficient procedural opportunities in LS#1 -Usually where the rules were more restrictive in 1st case than they would be in 2nd case -Usually in an administrative setting, where not much discovery is available a. b. c. Generally: issue preclusion prohibits a party from putting in issue in subsequent suit facts or questions determined and adjudicated in an earlier case Note: Issue preclusion does not affect issues or defenses that could have been raised but were not Elements i. Final judgment ii. On the merits iii. Same parties 1. Exceptions a. Non-mutual preclusion b. Privity iv. Same issue (this is narrower than claim preclusion) 1. Actually litigated a. This is distinguished from claim preclusion, where you didn‟t have to litigate, you just had to have the right to bring the claim (or affirmative defense) b. A 12(b)(6) does actually decide the issue, but it may not be essential to judgment 2. Determined 3. Issue was essential to judgment (to determine if essential, ask if the losing party on the issue has an incentive to appeal on that issue) 4 d. e. Alternate holdings or findings (ex. Parks case: either Pl was contributorily negligent or RR was not negligent) i. Rstmt 1 judgments 1. Both are sufficient for issue preclusion and both have an issue preclusion effect ii. Rstmt 2 judgments (General verdicts) 1. Both are sufficient for issue preclusion, but since you don‟t know which one was essential to the judgment, then Neither have an issue preclusion effect a. Unless the judgment is appealed: if the appealed holding is affirmed, then it will have an issue preclusion effect i. Usually only one of the judgments is appealed, so only it would have issue preclusion effect b. If a D raises 2 defenses, and then loses the case, each defense was essential to judgment, b/c the jury had to consider each defense and reject it to find for plaintiff. Therefore, the issues are precluded in subsequent actions. Example of an issue actually litigated and determined i. Ill RR v. Parks p. 836 1. Car and RR accident- victim brought a 2nd suit after having not been successful in 1st suit 2. LS#1 a. B Pl v. RR (personal injuries) b. J Pl v. RR (loss of consortium) i. J lost due to either Contributory Negligence or Sustained no damages 3. LS#2 a. J Pl v. RR (personal injuries) i. Why is there no claim preclusion in this case? Each party has the right to their own claim ii. RR asked for issue preclusion, but court denied 1. RULE: where a judgment may have been based upon either or any of 2 or more distinct facts, a party desiring to plead the judgment as an estoppel by verdict or finding upon the particular fact involved in a subsequent suit must show that it was previously decided upon that fact, or else the question will be open to a new contention Modern rule: Non-mutual preclusion i. This is a form of issue preclusion, and must meet all the requirements of issue preclusion plus the following: ii. Generally: when a party has had a full and fair opportunity to litigate a particular matter, a person not a party to the original litigation can invoke issue preclusion against the party who had the full opportunity 1. Allows a new party to invoke issue preclusion against a party who litigated and lost an issue in a prior action. 2. In every non mutual estoppel situation, the estopped party must have been a party in the 1 st suit and therefore had a chance to litigate the issue iii. Defensive preclusion (Shield Preclusion) 1. Occurs when a D seeks to prevent a pl from asserting a claim the pl has previously had a full and fair opportunity to litigate and lost against another D. 2. Bernhard case (CM p. 17) 3. Defensive Non-Mutual Preclusion (Shield Preclusion) (preclusion is asserted as a shield in favor of D2 who was not a party in LS#1) a. LS#1- Pl loses to D1 on issue of liability b. LS#2- Pl tries to sue D2 on same issue, but is precluded (this is called shield preclusion; D2 is asserting a shield to the same issue) c. Party asserting shield preclusion (D2) was not a party to the prior lawsuit iv. Offensive preclusion (Sword Preclusion) 1. Offensive Non-Mutual Preclusion (Sword Preclusion) (Pl2 asserts) (usually the issue is liability in a mass tort claim (plane crash, bus crash)) a. Involves a new pl who seeks to borrow a finding from a prior action to impose liability on a party who was a D who lost in a prior action i. LS#1- Pl1 sues D and D loses ii. LS#2- Pl2 sues D on same issue, and this is Sword Preclusion, the issue is automatically won due to LS#1 2. Discretionary factors courts use to determine whether to apply Offensive Non-mutual Preclusion: a. If Pl2 could have joined LS#1, and didn‟t, then the court may not apply offensive non-mutual preclusion (JOINDER) (most frequently occurring factor of the 4) a. 5 f. g. D did not have incentives to litigate in LS#1 (INCENTIVES) i. Not much was at stake in LS#1, the damages were small, so court may not apply offensive NMP, since D did not fight too hard in LS#1 b/c they wouldn‟t lose that much money c. There are inconsistent judgments (INCONSISTENCY) i. Several judgments that have different outcomes 1. State Farm v. Century Home Components d. D lacks sufficient procedural opportunities in LS#1 (PROCEDURAL OPPORTUNITIES) i. Usually where the rules were more restrictive in 1st case than they would be in 2nd case ii. Usually in an administrative setting, where not much discovery is available 3. Parklane Hosiery v. Shore (example of offensive non-mutual preclusion) a. Suit 1: SEC had filed suit against Parklane saying that proxy stmt was false and misleading, and SEC won (this is Public enforcement). b. This case is Suit 2, and Pl is suing Parklane for the same issue. They wanted to use Offensive Non-mutual Preclusion (Sword Preclusion) c. Issue: Is D collaterally estopped from litigating the issue of the false proxy statement that had been resolved against them in the SEC case? d. Holding: Yes: the issue was decided once, and cannot be litigated again Issue Preclusion Exceptions i. Inconsistent Judgments 1. State Farm v. Century Home Components a. Fire started on Century Home property. Burned down their warehouse, and 50 pl‟s properties. So 3 different pl‟s had sued, and the pl‟s won 2 cases and the D won 1. So the court said that issue preclusion would not work here, b/c we have inconsistent judgments b. If the circumstances are such that a court‟s confidence in the integrity of a prior judicial determination is severely undermined, or that the result would likely be different in a 2 nd trial, it would work an injustice to deny the litigant another chance. i. Thus, where it is apparent that the verdict was the result of a jury compromise, the losing party should not be precluded by the judgment. ii. Also, if there were alternative defenses, and you have a general verdict, it is impossible to tell what the jury decided, so issue preclusion would not be appropriate ii. Newly discovered or crucial evidence that was not available to the litigant at the 1st trial when it appears that the evidence would have a significant effect on the outcome iii. The forum in the 2nd action affords the party against whom preclusion is asserted procedural opportunities not available in 1st suit iv. The determination relied on as preclusive was itself inconsistent with another determination of the same issue v. If there is no appeal or right to appeal, then you can’t use issue preclusion vi. The issue is one of law and (a) the 2 actions involve claims that are substantially unrelated, or (b) a new determination is warranted in order to take account of an intervening change in the applicable legal context or otherwise to avoid inequitable administration of the laws 1. The issue is one of law and a new trial is necessary in order to account for a change in the law vii. A new determination of the issue is warranted by differences in the quality or extensiveness of the procedures followed in the 2 courts or by factors relating to the allocation of jurisdiction between them viii. The party against whom preclusion is sought had a significantly heavier burden of persuasion with respect to the issue in the initial action than in the subsequent action; the burden has shifted to his adversary; or the adversary has insignificantly heavier burden that he had in the 1 st action 1. The burden of proof on the party against whom preclusion is sought was greater in the prior trial ix. There is a clear and convincing need for a new determination of the issue 1. Because of the potential adverse impact of the determination on the public interest or the interest of persons not themselves parties in the initial action 2. b/c it was not sufficiently foreseeable at the time of the initial action that the issue would arise in the context of a subsequent action 3. b/c the party sought to be precluded, as a result of the conduct of his adversary or other special circumstances, did not have an adequate opportunity or incentive to obtain a full and fair adjudication in the initial action Law of the Case- the parties get a single appellate shot at their legal contentions and that, once they have achieved such an appellate ruling, it continues to govern in subsequent trial and appellate proceedings. b. 6 h. i. Judicial Estoppel- typically invoked when a party has taken a sworn position in a prior proceeding, benefited from that position by receiving a judgment or other official award, and now seeks to take a differing position in the present proceeding in order to win a judgment that would rest on a basis inconsistent with his prior position i. Judicial estoppel is a doctrine that precludes a party from adopting a position inconsistent with a stance taken in prior litigation ii. 3 elements 1. The party sought to be estopped must assert a position inconsistent with that taken in prior litigation and the position must be one of fact rather than law or legal theory 2. The prior inconsistent position must have been accepted by the court 3. The party sought to be estopped must intentionally have misled the court to gain unfair advantage Federated v. Moitie (TWEN case) i. Consumers brought consolidated private antitrust suits against department stores complaining of fixing of prices of women's clothing in Northern California. District Court for the Northern District of California, dismissed for failure to allege specific standing to sue, but the Court of Appeals for the Ninth Circuits, reversed and remanded. Two plaintiffs who did not appeal the original decision filed state court actions which were removed to federal court, wherein the cases were dismissed on the basis of res judicata, and plaintiffs appealed. The Court of Appeals for the Ninth Circuit, reversed, and certiorari was granted. The Supreme Court, Justice Rehnquist, held that under accepted principles of res judicata, the Court of Appeals was unwarranted in declining to dismiss the two refiled private antitrust actions which involved the same claims and parties as prior action dismissed by final judgment of the district court, even though other plaintiffs in the prior action appealed and ultimately secured reversal, and even though the Court of Appeals believed the two plaintiffs' position was "closely interwoven" with that of the successfully appealing parties and that the doctrine of res judicata should give way to "public policy" and "simple justice." Reversed and remanded. ii. Final judgment rule - unappealed federal judgment has preclusive effect 1. Lesson is you should appeal, don‟t re-file in state court 2. Judicial opinions only effect pending cases. Here, these pl‟s had lost, but not appealed, so their case wasn‟t still pending. III. COLLATERAL ATTACK – an attack on the validity of judgment in the enforcing court a. A challenge to the integrity of a judgment, decree, or order brought in an action separate from the one which rendered the original judgment, decree, or order. It is not an appeal or review, and although it seeks to avoid or defeat the judgment, it must have a stated purpose other than that of impeaching the judgment; e.g., a challenge to proper jurisdiction often constitutes the basis for a collateral attack. i. Validity of judgments (12b motions) 1. Subject matter jurisdiction 2. Personal jurisdiction 3. Notice a. Party in LS#1 who litigates issues a, b, c is bound and may not bring collateral attack (or litigate merits) b. Party who defaults in LS#1 may bring collateral attack on judgment validity in enforcing court (why? They have never had their day in court) b. Direct Attack- attack on the validity of judgment in the issuing court i. A challenge to have a judgment reversed, corrected, vacated, annulled, voided, or enjoined, made in a proceeding for that express purpose. It differs from a collateral attack which challenges a judgment in a proceeding instituted for another purpose in another court. c. Full Faith and Credit -article IV § 1 i. Generally requires every state to give to a judgment at least the res judicata effect which the judgment would be accorded in the state which rendered it 1. LS1 & LS2 same court, same state a. This is common law preclusion 2. LS1 – state A & LS2- state B a. This is full faith and credit 3. Federal to State or State to Federal a. § 1738 ii. Durfee v. Duke - Suit regarding the preclusive effect of a prior decision as to the ownership of certain bottom land on the Missouri River between Neb. and Mo. 1. Case was tried in Neb. and then the respondent tried to refile 2 months later in Mo. 2. LS#1 Neb court a. Quiet title to land along MO river b. D loses 3. LS#2 MO court a. D sues challenging validity of Neb Judgment 7 4. 5. 6. i. US S. Ct. prohibits D from challenging SMJ in LS#2 b/c of Full Faith and Credit Issue: When an issue has been fully and fairly litigated and finally decided in a particular court, must other courts give full faith and credit to that judgment? Holding: Yes RULE: a judgment is entitled to full faith and credit, even as to the question of jurisdiction (here, SMJ), when the 2nd court‟s inquiry disclosed that those questions have been fully and fairly litigated and finally decided in the court which rendered the original judgment. IV. REOPENING JUDGMENT- FRCP Rule 60(b) a. In some cases, a prior judgment can be reopened by means of an independent action i. An independent action should be available, however, only to prevent a grave miscarriage of justice. ii. Independent actions must be reserved for those cases of injustices which, in certain circumstances, are deemed sufficiently gross to demand a departure from the rigid adherence to the doctrine of res judicata b. FRCP Rule 60(b) c. (1)-(3) 1 year limitation i. (1) Mistake, inadvertence, surprise, or excusable neglect ii. (2) Newly discovered evidence wich by due diligence could not have been discovered in time to move for a new trial under 59(b) iii. (3) Fraud, misrepresentation or other misconduct of an adverse party d. (4)-(6) reasonable time limitation i. (4) The judgment is void ii. (5) The judgment has been satisfied, released, or discharged, or a prior judgment upon which it is based has been revered or otherwise vacated, or it is no longer equitable that the judgment should have prospective application iii. (6) Any other reason justifying relief from the operation of the judgment e. This is a very rare option, and is rarely successful f. United States v. Beggerly i. Facts: US brought a quiet title action against Beggerly for some beachfront property. The case turned on whether, before the Louisiana Purchase, the land had been deeded to a private individual. The case settled., and a small sum was paid to Beggerly. Twelve years later, a gov official found a doc that proved Beggerly was the owner. He brought a new suit 1. District ct said it was w/o jurisdiction. Appeals ct reversed. ii. Issue: can completed litigation be reopened when new evidence is found? iii. Holding: Yes, but not here. The one-year limitation had run out on new evidence. iv. Rule: Independent actions must be reserved for those cases of injustices which, in certain circumstances, are deemed sufficiently gross to demand a departure from the rigid adherence to the doctrine of res judicata 1. An independent action should be available only to prevent a grave miscarriage of justice. (Gross injustice) JOINDER OF CLAIMS AND PARTIES: - So have supplemental (ancillary/pendant) jurisdiction only when smj is not meet as in no diversity or fed question? a. Permissive Joinder of Claims (Rule 18) i. Provides that a party seeking relief from an opposing party may join with his original claim any additional claims he has against the opposing party (no common transaction or occurrence needed) 1. (a) Joinder of claims- a party asserting a claim to relief as an original claim, counterclaim, crossclaim, or 3rd party, may join, as many claims as the party has against an opposing party b. Claims by the Defendant: Counterclaims (Rule 13) i. Authorizes a defending party in a suit to assert claims back against a party who has claimed against him 1. A claim brought by D against Pl a. Here, the D is trying to get money against Pl, which distinguishes this from an affirmative defense 2. (a) Compulsory counterclaim a. D must bring his claim arising out of the transaction or occurrence that is the subject matter of the opposing party‟s claim or he loses the right 3. (b) Permissive counterclaims- claim that is unrelated to the original claim ii. Joinder by D: Rule 13(g) Cross claims- D1 brings a claim against D2 (note: cross claims are permissive) 1. Cross claim has to arise out of the same transaction or occurrence iii. 13(h) Joinder of additional parties-persons other than those made parties to the original action may be made parties to a counterclaim or crossclaim in accordance with rule 19 or 20. iv. Example of a compulsory counterclaim- Plant v. Blazer Financial V. 8 Pl sued D on a fed claim for Truth and Lending Act for failure to disclose. D counterclaimed against Pl on the debt action, since the Pl hadn‟t paid yet 2. The counterclaim was not a fed claim, so there is no original jurisdiction on this claim. So we have to see if we have subject matter jurisdiction. However, if the counterclaim is compulsory, then SMJ is automatic (supplemental/ancillary jurisdiction) a. The reason is, the tests are identical for finding whether there is compulsory counterclaim or supplemental jurisdiction, and that is the same transaction or occurrence test 3. So to find out if the counterclaim is compulsory under Rule 13, we ask if it arises out of the same transaction or occurrence? a. How do we figure out if the claim arises out of the same transaction or occurrence as the pl‟s claim? i. The court said they would look at the logical relationship test 1. The logical relationship test is a loose standard which permits a broad realistic interpretation in the interest of avoiding a multiplicity of suits. This test is very flexible ii. The same transaction or occurrence was that it was the same loan agreement 1. This is on the outer limits of the same transaction or occurrence iii. In this case, the court found that the counterclaim was compulsory, so it had supplemental jurisdiction automatically 1. There is a split on this issue for courts Permissive Joinder of Parties, Rule 20 (pl‟s and D‟s) All parties may join in one action as pl’s if they assert: -A common right to relief -Their claims arise out of the same transaction or occurrence -There is common question of law or fact However, in order for parties to join there needs to be complete diversity, and supp jurisdiction doesn’t apply Also, rule 20 allows the pl to sue multiple D’s in a single action if the same criteria are met. -We must keep in mind jurisdiction, so we have to look at where parties are from, and keep in mind fed question, diversity, supp jurisdiction, pendant party -Joinder check list: 1. Joinder rules 2. Jurisdiction rules- mostly SMJ 3. Preclusion rules operating in the background 4. Strategy- which pl‟s Permissive Joinder of parties 1. Common right to relief 2. Same transaction or occurrence 3. Common question of law or fact Examples of Permissive Joinder- Mosley v. General Motors -10 employee plaintiffs‟ vs. GM and Union D‟s -Class action- gathering many people together makes it look like GM has a systematic discriminatory practice -Can we satisfy the joinder requirements of Rule 20? District court said no, but appellate court said yes: -Same transaction or occurrence? Yes, discriminatory policies -Common question of law or fact? Yes, common issues of discrimination -So there is a logical relationship IMPLEADER of 3rd party claims- Rule 14: (Impleader is permissive) Impleader allows D parties to act as pl’s against a 3rd party. A 3rd party can only be brought into the case if they have derivative liability (meaning they have liability to the original D in the same claim, either by joint tort liability or K liability (contribution or indemnity)). Essentially, the D is saying, "If I am liable to Pl, then the 3rd party is derivatively liable and must reimburse me for all or part of anything I must pay pl. Even if there is a lack of diversity between the D and the 3 rd party, the court will have supp jurisdiction under 1367 since the claim arises out of the same transaction or occurrence. -Although the pl is allowed to join the 3rd party D under rule 14 if the claim arises out of the same transaction and occurrence that is the subject matter of the pl’s original claim, they will not be allowed to assert a claim against the 3rd party D if there is not diversity, since this is not allowed under supp jurisdiction 1367. -Allows D parties to act as pl‟s against a 3rd party -The only type of claim than can be brought is bringing in a new party that has derivative liability (meaning they have liability in the same claim against the original D) 1. 9 Rule 14 is based on substantive law type of relationship: There must be either: 1. Joint tort liability, or 2. There has to be a basis of K liability Watergate case-Pl Home owner‟s association sued D1 (realtor) and D2 (engineer). D1 cross-claimed D2 and brought a 3rd party claim against Brisk waterproofing (who had been hired to do work for the homeowner‟s association) -Can the realtor bring in Brisk to this suit? Does it meet the requirements of rule 14? Court said no, the neg. repair claim is not derivative of the original claim. Rule 14: a 3rd party claim can only be maintained if the liability it asserts is in some way derivative of the main claim (either joint tort liability, or K liability) -“It was him, not me” won‟t work -What will work is” If I am liable to pl, then the 3rd party D is derivatively liable and must reimburse me for all or part of anything I must pay pl -Note: Some cases, we can get joinder, but not jurisdiction (supp. jurisdiction § 1367) -14a authorizes the 3rd party D to assert claims against the plaintiff if they arise out of the same transaction or occurrence as the main claim, and they will have jurisdiction under §1367 even if they are not diverse Owen case-Plaintiff Kroger sued D1 OPPD for wrongful death, who filed a 3rd party claim against D2 (Owen) (under rule 14) -Pl then amended and asserted a claim against the 3rd party D (Owen) which arose out of the transaction or occurrence that was the subject matter of the original claim. -OPPD could file the 3rd party claim against Owen (under rule 14) and got supp jurisdiction under Ancillary §1367. -But then OPPD got out of the case -Then Owen claimed that court had no juris (they brought this up under rule 12(h)(3), which could be brought up at any time), b/c there was no complete diversity, b/c Owen had principle place of business in Iowa -S.Ct has said that a lack of complete diversity can be brought up at any time It doesn‟t matter whether pl originally sues a D, or the D is brought in as a 3rd party: either way a lack of complete diversity will destroy jurisdiction -Owen case review: Key is it is not enough to satisfy the joinder req‟s; you must also satisfy jurisdiction req‟s OPPD could add Owen under rule 14, and had supp jurisdiction (ancillary) so this was ok. However, Ms. Kroger did not have diversity juris over Owen, so she had no supp juris over Owen VI. COMPULSORY JOINDER OF PARTIES- Rule 19 (CM 26-27) ??? Parties must be added to lawsuit. In order to use Rule 19, compulsory joinder of parties, you first ask if the party is a necessary party. To determine this, you must have 1 of the following 3: -Complete relief couldn’t be accorded if the party wasn’t joined OR -Impaired interest (looking at the absentee) (possibly not enough money to go around), OR -Inconsistent obligations would arise (parties) Then you must show adding the necessary party won’t upset: -Personal juris- (min. contacts or accident occurred) AND -Subject matter juris- (fed quest, diversity, or supp juris 1367) AND -Venue-(residence or accident occurred) If the party fails to meet PJ, SMJ, or Venue, then: You must ask if the party is indispensable? (If yes, party must be joined; if they can’t be joined (when would this happen?) then suit must be dismissed. If no, then we can proceed w/o them). To determine if indispensable, look at: 1-Prejudicial judgment? How prejudiced will the judgment be to the party? 2-Mitigation of prejudice? Are there ways that the prejudice can be lessened or avoided by provisions in the judgment, by shaping relief, or other measures? 3-would there be an adequate judgment in absence of the party? 4-would there be an adequate remedy for pl in absence of the party? -It is going to weigh against the party being ruled indispensable if the pl wouldn’t have anywhere else to sue. -If you get the 1st 3 elements plus one of the next 3, then you must show adding the necessary party won‟t upset the personal jurisdiction, the SMJ, or the venue req‟s. If not, then go to 19(b) Proceed or dismiss factors (if they are indispensable, then we must dismiss): -Prejudicial judgment? -Mitigation of prejudice? -Adequate judgment? -Adequate remedy for pl? 10 Analysis: (see rule 19) Step one: are they a necessary party? -Complete relief (parties), or -Impaired interest (looking at the absentee), or -Inconsistent obligations (parties) Step two: then you must show adding the necessary party won‟t upset the personal jurisdiction, the SMJ, or the venue req‟s. -Personal jurisdiction -Subject matter juris -Venue Step three: Is the party indispensable (crucial, essential, necessary) Isn‟t this the same necessary requirement as step one? Proceed or Dismiss Factors: (If yes, they are indispensable and we must dismiss. If no, then we can proceed w/o them) -Would the absence of the party give a prejudicial judgment? -Mitigation of prejudice? -Court is to consider ways in which prejudice to the absent party can be lessened or avoided -Would there be an adequate judgment in absence of the party? -Would there be an adequate remedy for pl in absence of the party? A tort case can never be brought under rule 19; they must use another rule (14) -So rule 19 works with: - Property rights cases (3 competing claimants for Blackacre, but one of the parties is omitted from the suit) - K obligations - Obligations between those who are initially made parties and those who have not been joined Helzberg case: Pl (Helzberg) signed a K with D to rent space. In their lease they said that D could only lease to 2 other full service jewelry stores. The D then leased to a 3rd full service jewelry store (Lords). Pl was granted an injunction against the D stopping them from leasing to Lords. D moved to dismiss pursuant to Rule 19 saying Pl had failed to join Lords as a party. They said Lords had to be joined, b/c they were a necessary party? The motion was denied. D appealed. Appeals court affirmed. To analyze: Step 1- is Lords a necessary party? -Impaired interest (19(a)(2)(i) (yes for Lords) -Inconsistent obligations (yes for D mall) Step 2- will adding the necessary party upset the personal jurisdiction, the SMJ, or the venue req‟s? -Yes, there is no personal jurisdiction of the court over Lords (no PJ in Missouri) Step 3- Is the party indispensable? -Prejudicial judgment? Lords is not bound by this judgment, so they won‟t be prejudiced -There may be some prejudice to the Mall, b/c of inconsistent judgments, but they brought this upon themselves by signing inconsistent K‟s with tenants - Mitigation of prejudice? The district court gave Lords a chance to intervene in the lawsuit, but they chose not to do so. So the court acted in a way to sufficiently protect Lord‟s interests. -Adequate judgment? Yes -Adequate remedy for pl? Yes VII. INTERVENTION: Rule 24 (pg. 33-35) There are two types intervention: Rule 24(a): Compulsory intervention (Intervention of Right) Parties shall be permitted to intervene when: 1- A U.S. statute confers an unconditional right to intervene, OR 2- (a) The party has a sufficient interest to intervene relating to the property or transaction, (interest in subject matter) (b) The interest will be impaired if they are not allowed to intervene, (interest must be impaired) AND (c) There is no adequate representation by the existing parties (no adequate representation) Rule 24(b): Permissive intervention (this is discretionary) is appropriate when upon timely application anyone may be permitted to intervene when: 1-a U.S. statute confers a conditional right to intervene, OR 2-when applicant's claim or defense and the main action have a common question of law or fact, OR 3-when a party to an action relies for ground of claim or defense upon any statute or executive order administered by a federal or state government officer or agency. 11 In rule 24 (a) and (b), Intervener must also show that adding them to the lawsuit will cause--No undue delay or prejudice (intervening earlier is better). Intervener must also satisfy jurisdictional requirements, and Congress has barred supp juris over this type of claim in 1367. Factors to be considered in determining whether a motion to intervene is timely are: -How long the applicant knew of his interest before making the motion -Prejudice to the existing parties from any such delay -Prejudice to applicant if the motion is denied -Other unusual circumstances 24(a) Intervention of Right (1) US Statute allows -Ex. Litigation under Fair Housing Act -HUD will bring a suit against somebody, and the FHA allows private parties to intervene OR (2) Impaired Interest unless adequate representation (we will focus on this) Intervener must also show that adding them to the lawsuit will cause--No undue delay or prejudice (intervening earlier is better) Most cases are fought under 24(a) Natural Resources Defense Council v. United States Nuclear Regulatory Commission -NRDC is suing NRC and NMEIA to require an environmental impact study -Kerr-McGee (as well as others) are trying to intervene, saying this effected them -Court looked at whether they should be allowed to intervene by whether they had a sufficient interest in the suit -The district court said that Kerr was already sufficiently represented by another party that had intervened -The appeals court disagreed, and said 1. What is required to show there is a sufficient interest to intervene? -If you have a direct interest in the property or transaction, this will be sufficient -If you don‟t have a direct interest, you can still intervene if your interest would be impaired by the outcome of the lawsuit 2. What does impairment mean? -What is the practical impairment if you are not allowed in the case? -Preclusive effect? Would you be precluded from the suit later if not allowed in? -Stare decisis effect? Would a new principle of law significantly impair you? -Practical effect- is the nature of the decision going to have a huge practical effect on you? 3. Do you have adequate representation if you are not allowed to intervene? -In this case the court said no -What happens to someone who has the chance to intervene, chooses not to, and then their rights are effected by the lawsuit? -They are not bound in the preclusion sense. It is up to the existing parties to bring the parties in if they want them bound. Martin v. Wilks Consent decrees (this is a binding judgment and has preclusive effect) entered into between black firefighters and city regarding Affirmative action in Birmingham, Alabama. White firefighters wanted to join, and were denied. -In order to be bound by consent decree, one must have party status or privity (a member of class that is represented) -Non-parties are not bound and can collaterally attack -No duty to intervene under rule 24: -The existing parties use rule 19 compulsory joinder if they want to join the other firefighters -Why no joinder? The black firefighters didn‟t join the white firefighters b/c of Strategy -Why would you join the other employees who oppose the relief you are seeking? You wouldn‟t; so they didn‟t -If you don‟t intervene, and you don‟t have privity, you are not bound by judgment and the result does not preclude you from future action INTERPLEADER Interpleader is designed to equitably resolve in one proceeding claims by multiple parties against a holder of property, or against a fund that has limited liability (such as an insurance company) or limited assets. Interpleader is a form of joinder open to a stakeholder who does not know to which of several claimants he is liable, if he is liable at all. It permits him to bring the claimants into a single action and to require them to litigate among themselves to determine which, if any, has a valid claim. There are 2 types of Interpleader: mutually exclusive claimants (where 2 claimants say, “it’s all mine”) and equally entitled claimants (like in State Farm case, where the injured parties each get a fair share of fund). Interpleader in Fed courts consists of 2 separate provisions: 1-Statutory interpleader (sec. 1335) authorizes interpleader actions when: -$500 or more is at stake, AND -2 or more adverse claimants of diverse citizenship (under § 1332) (minimal diversity) have claims to the property, AND 12 -Plaintiff deposits the money or property or its monetary equivalent with the court and agrees to abide by the decision for distribution -There is nationwide service of process, so you have PJ; Territorial juris throughout the US -Venue is proper in any district in which a claimant resides (the stakeholder picks the venue of one of the claimants) NOTE: both identical or common claims and adverse or independent claims may be litigated under statutory interpleader. PROBLEM AREA IS VENUE 2-Rule 22 interpleader- the requirements are: -Complete diversity (stakeholder on one side, claimants on the other) with more than 75k in controversy, -You need personal juris is limited to state boundaries plus the reach of long arm statutes under with service of process through rule 4, and -Venue is proper pursuant to 1391 under the residence of any claimants (if all from 1 state); or district where dispute arose; or district where prop is; or district where claimant found if no other basis for venue PROBLEM ARE IS PERSONAL JURISDICTION -Someone has a fund of money or property (stakeholder), and other parties are claiming it and saying it is mine. -Interpleader allows the stakeholder to get the parties in the same lawsuit to decide who gets the fund or property (add definition from 3637 from CM) Two types of Interpleader: 1. Mutually exclusive claimants a. Where 2 claimants say, “it is all mine” 2. Equally entitled claimants a. Like the State Farm case, where the injured parties get a fair share of the fund Issue: Subject Matter jurisdiction Statutory Interpleader Minimal diversity: as between at least Two adverse claimants is sufficient §1335 $500 -Nationwide service of process §2361 -Territorial juris throughout the US Rule 22 Interpleader Complete diversity between pl stakeholder and adverse claimants §1331 or 1332 more than 75k service under rule 4 Juris is limited to state boundaries plus the reach of long arm statutes §1391 residence of any claimants (if all from 1 state); district where dispute arose; district where prop is; district where any claimant may be found if no other basis for venue §2283 same effect as §2361 Amount in controversy Territorial juris: service of process Venue §1397 residence of 1 or more claimants (district in which claimants reside) Enjoining other state or fed court actions (Injunctions) §2361 Interpleader court can enjoin any state OR fed court proceeding dealing with the same claim or property Rule 22- Interpleader: Persons having claims against the pl may be joined as D‟s and required when their claims are such that the pl is or may be exposed to double or multiple liability. It is not ground for objection to the joinder that the claims of the several claimants or the title on which their claims depend do not have a common origin or are not identical but are adverse to and independent of one another, or that the pl avers that he is not liable in whole or part to any or all of the claimants. A D exposed to similar liability may obtain such interpleader by way of cross-claim or counter-claim. The provisions of this rule supplement and do not in any way limit the joinder of parties permitted in Rule 20. (Subject matter jurisdiction/diversity) Examples: Stakeholder Claimant 1 Calif v. AZ v. (pl) (D) Claimant 2 Nev. (D) Both Statutory and Rule 13 Stakeholder Calif (pl) Stakeholder Calif (pl) v. Claimant 1 AZ (D) Claimant 1 AZ (D) v. Claimant 2 AZ (D) Claimant 2 Calif. (D) Rule Only Note: Pl and Defendant have to be diverse v. v. Statutory Only Note: Defendants have to be divers Requirements of Interpleader: -SMJ -Personal Jurisdiction -Venue -Injunctions State Farm case: Truck hits Greyhound bus; State Farm had a liability policy with a max of 20k on the truck driver -The pl‟s (truck owner, bus passengers, bus driver, etc.) -State Farm didn‟t want to defend all of these different suits, b/c its max liability was going to be 20k no matter what. -So they moved for interpleader, so they would only have to defend once in the district court in Oregon, and then the payments would be distributed in a fair way The Supreme Court didn‟t allow Interpleader to happen: 1. They ruled that minimal diversity under § 1335 was consistent under Art. III of the constitution 2. They ruled that claims do not have to be reduced to judgment before you file your interpleader claim Absence of state law or contractual provision for direct action suits against insurer does not require insurer to wait until persons asserting claims against its insured have reduced such claims to judgment before seeking to invoke benefits of federal interpleader 3. Interpleader cannot be used as an all purpose bill of peace -An equitable remedy that would bring in all parties from a single accident (Bill of Peace) is not allowed. -Federal interpleader cannot be used to solve all vexing problems of multiparty litigation arising out of mass tort -Federal interpleader was not intended to serve function of a bill of peace in context of multiparty litigation arising out of mass tort -The Supreme Court allowed, through interpleader, state farm to have all claims against its driver brought in a single court. The did not allow all issues from the mass tort to be brought in one case, meaning, if pl‟s wanted to sue Greyhound, they could do so in another court. -The s. ct. said that the insurance claims could be brought in interpleader, but the tort claims could not Illustration of mutually exclusive claims: Cohen case: Marcos owned some paintings. The paintings were in the custody of the art dealer, Cohen (stakeholder). He said he owned part of the paintings, and he is unsure who owns the paintings, so he files an interpleader to bring in the employee of the Marcos, the Philippines (who said they had a right to the paintings, b/c the Marcos got them by ill gotten gain). -The Marcos, who said they had bought them with their own money, decided to intervene, b/c she wanted to protect her interest in the paintings. CLASS ACTIONS Under rule 23, a class action must be certified before the action may proceed. To be certified, all the elements of 23(a) must be satisfied, and then the class must fall into one of the categories under 23(b). The elements of 23(a) are: 1-NUMEROSITY- the class is so numerous that joinder of all members is impracticable (some have said minimum is 35) 2-COMMON QUESTION- there are questions of law or fact common to the class 3-TYPICALITY-the claim or defenses of the representative parties are typical of the claims or defenses of the class 4-ADEQUATE REPRESENTATON- the representative parties will fairly and adequately protect the interests of the class. This includes having adequate counsel and the resources to carry through with the action What’s the difference between typicality and adequate representation. Ask professor. Secondly, the class must fit within one of the 23(b) groups: 1-(b)(1)(A) INCONSISTENT ADJUDICATION The prosecution of separate actions by or against individual members of the class would create a risk of inconsistent or varying adjudications with respect to individual members of the class which would establish incompatible standards of conduct for the party opposing the class (This usually is used with nuisance, bond, and riparian rights cases) OR 2-(b)(1)(B) IMPAIRED INTEREST (ex. Would be the Imelda Marcos case?) 14 The prosecution of separate actions by or against individual members of the class would create a risk of adjudications with respect to individual members of the class which would as a practical matter be dispositive of the interests of the other members not parties to the adjudications or substantially impair or impede their ability to protect the interests OR 3-(b)(2) INJUNCTIVE RELIEF (often civil rights cases) The party opposing the class has acted or refused to act on grounds generally applicable to the class, thereby making appropriate final injunctive relief or corresponding declaratory relief with respect to the class as a whole OR 4-(b)(3) COMMON QUESTION PREDOMINATES - The court finds that the questions of law or fact common to members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy - Factors to consider include the individual interests at stake (whether they would be better adjudicated individually), the desirability of a single forum, existing litigation of class members, and the difficulties of the judicial management of the class - NOTICE ONLY REQUIRED HERE Furthermore, the judge has discretion to allow subclasses and has the ability to separate out issues for a class action under 23(c)(4) and the provisions of the general rule will be applied accordingly Did the judges certification order comply with constitutional notice and procedural requirements for certification under the FRCP? Due process of law requires that all litigants have notice and opportunity to be heard which will be satisfied in (b)(1) and (b)(2) actions merely if there is adequate representation. However, in a (b)(3) action notice must be sent to all class members by the best method available, including individual notice to all members who can be identified through reasonable effort before certification will be proper. The notice costs must be paid by the plaintiff representative and the contents of the notice must advise each member that: 1) The court will include all members who do not request exclusion by a specified date (opt out rights), 2) The judgment, whether favorable or not, will include all members who did not request exclusion, and 3) Any member who does not request exclusion, may enter an appearance through counsel with the court if he desires. 2 types of claims (only occur if the lawyers cooperate): 1. Small claim class action with common liability issue 2. Mass tort class action with common liability issue Example of class action: Communities for Equity v. Michigan High School Athletic Assn. Title IX case, high school girls wanting equal treatment -High school girls athletes vs. the state high school athletic assn. -Typicality could be difficult here, since the representative must be typical of class. Here, high school girls who were happy with the way things were. However, the court said that was ok, since the underlying discrimination would be illegal. (Ogden disagrees with this) -This class fit under Rule 23(b)(2), Injunctive or declaratory relief Heaven v. Trust Company Bank Lady leasing Ford Taurus brought class action suit, and court denied under subdivision (b)(3) Common Questions Predominate The court finds that the questions of law or fact common to members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy Factors:  A-the interest of members of the class in individually controlling prosecution or defense of separate actions  The D‟s had counterclaimed against several class members for debt actions  The court determined that the interests of some individual class members in controlling their own case would be compromised. Their exposure as counterclaim D‟s could well exceed the amount they might recover for statutory penalties as class members The court also looked at 23b3D D-the difficulties likely to be encountered in the management of class action -The court determined that because of the counterclaims, the court would have to engage in multiple separate factual determinations, and this would make management of the class action difficult CLASS CERTIFICATION: 23(c) (also, see CM p. 45-46) 15  23(c)1- as soon as practicable after the commencement of an action brought as a class action, the court shall determine by order whether it is to be so maintained. An order under this subdivision may be conditional, and may be altered or amended before decision on the merits  23(c)2- Notice (only in (b)(3) actions): In any class action maintained under (b)(3), the court shall direct to the members of the class the best notice practicable under the circumstances, including individual notice to all members who can be identified through reasonable effort Contents of a (b)(3) Notice: 3 things that must be told to class members. (b1 and b2 do not have these requirements) 1. Exclusion rights (opt out rights): the notice shall advise each member that (A) the court will exclude him from the class if he so requests by a specified date (23c2A) 2. Binding effect: (B) the judgment, whether favorable or not, will include all members who do not request exclusion (23c2B) 3. Participation Rights: and (C) any member who does not request exclusion may, if he desires, enter an appearance through his counsel (23c2C)  23(c)3 (2 options) Judgments in Class Actions WHAT IS THIS?? 1. Court description of those found to be members of the class in (b)(1) or (b)(2) actions -The judgment is an action maintained as a class action under subdivision (b)(1) or (b)(2), whether or not favorable to the class, shall include and describe those whom the court finds to be members of the class 2. 23(b)(3) class actions: court description of those given (c)(2) notice, and who have not opted out, and whom the court finds to be class members -The judgment is an action maintained as a class action under subdivision (b)(3), whether or not favorable to the class, shall include and specify or describe those to whom the notice provided in subdivision (c)(2) was directed, and who have not requested exclusion, and whom the court finds to be members of the class  23(c)(4) Subclasses and Partial class actions -When appropriate (A) an action may be brought or maintained as a class action with respect to particular issues, or (B) a class may be divided into subclasses and each subclass treated as a class, and the provisions of this rule shall then be construed and applied accordingly 23d, e, and f (He went through very quickly) 23d orders Rule 23e governs settlement of class actions. It requires NOTICE and COURT APPROVAL: -Dismissal or Compromise. A class action shall not be dismissed or compromised w/o the approval of the court, and notice of the proposed dismissal or compromise shall be given to all members of the class in such manner as the court directs 23f appeals Preclusion and class actions: -Normally, to be bound, you either have to be a party or in privity with a party -Class members can be bound if their interests are adequately represented by the class representative (due process of law) Hansberry v. Lee Hansberry challenged a racially restrictive covenant as a collateral attack. Pl tried to enforce a racially restrictive covenant in a neighborhood in Chicago. Court below said that the Hansberrys were barred, b/c they were bound under a previous action (Burke) ruling that the covenant was ok. The S.Ct. disagreed. The Hansberry‟s didn‟t have adequate representation in the prior case. -The court said that not giving the class their day in court Class members can be bound, but the class members must have adequate representation and there must not be a conflict of interest between class members 1- Notice Cost: Notice costs must be paid by the plaintiff representative of the class. If the class is large these notice costs can be substantial, and that can act as a barrier to class representative bringing b3 actions. 2-Class Action Certification Decisions (see p.47) -D‟s can seek to decertify the class Class actions are filed by a representative who alleges a class action claim, and identifies in pleadings the nature of the class action, the identity of the class or classes, and how the requirements of Rule 23(a) are met, and which of the Rule 23(b) types of classes this class action satisfies. Before a class action can go forward, the judge has to certify the class as a proper class action under Rule 23(c)(1). The certification order is conditional, and may be changed by the judge before the trial on the merits. In the trial court, the appropriate way to challenge a class action certification order is to file a motion to decertify the class action, which the trial judge will rule upon, either decertifying the class action or denying the motion to decertify. Decisions by district courts to grant or deny certification of a class action have a large impact on the case. Granting certification can lead to a much larger risk of liability for greater amounts of damages on the part of the non-class party. Denial of certification can irreparably harm the representative's claim, especially in a small damage large number of claimants type of case. Thus, there is often a great incentive for parties who have lost a class action certification, defendants 16 when certification is granted, and plaintiffs when it is denied, to challenge the decision, either through motions to decertify, or through appeal. 3-Appeals of Class Action Certification Decisions -23(f) permits discretionary appeals (it is not an automatic right to appeal) Immediate appeals of a class action certification order are very rare. This is because normally the certification decision is interlocutory, in that there are other stages of the pretrial and trial process that have to be completed before the trial court can enter a final judgment. Thus, a class action certification order is normally not considered to be a final judgment on the merits under 28 USCA 1291. However, some class action certification decisions have been appealed under the collateral order doctrine You don‟t get notice in b1 and b2 actions, unless there is a settlement Phillips Petroleum v. Shutts D‟s argument was a Due process of law & pl class members argument The D‟s argued that the court didn‟t have personal juris. (minimum contacts) with the pl‟s (a creative argument), and that the opt-out provision was against due process. They suggested instead to use an opt in provision. The court disagreed, and said: -Minimum contacts are not required -Opt in idea rejected The court rejected the D‟s arguments, and said that the Burden on D‟s is what justifies the min. contacts test: 1. Compelled judgment [default] 2. Counsel 3. Discovery 4. Liability for damages and af and costs 5. Travel to forum to defend AND that the burden on the pl‟s in this case wouldn‟t justify a min. contacts analysis. The Pl class members: 1. No judgment against pl class likely 2. Right to opt out 3. Right to parties 4. Class rep. A.R. and CI requirement 5. Class rep. and judge look out for class members 6. Settlements are court approved So the burdens of the pl‟s are far less than the burdens on the D‟s; therefore, due process requires: Due Process Requirements 1. Notice to class members of class action in (b)(3) type actions 2. Opt out rights in (b)(3) type actions The court held that the state court was free to apply one of several choices of law -Some states allow different theories of law to be applied. There are several different theories: Choice of Law: theories 1-1st Rstmt 2- 2nd Rstmt 3- Interest analogy Just know that there are different theories in the different states, but that this case said that: -As held in Allstate case- a state can‟t apply it‟s law unless the D‟s have strong contacts with the state (resident, forum related activities in the state) -With class members, they said if you give them opt out rights, then minimum contacts won‟t apply for PJ; they will still be subject to juris in KS -But, the court said the KS state court couldn‟t apply its state law to class members who didn‟t have contact with that state. So the KS court would have to apply the state law of each of the class member‟s states Settlement of class actions Amchem v. Windsor -Global (b)(3) settlement -Asbestos related claims -Settlement class -Administrative scheme for paying in the future when claims came up The pl‟s made one large class, of present and future members 17 1-injury claimants (present), and 2-exposure claimants (future) -They made this all one class Pl‟s were to be bound forever, and the D‟s were only bound for 10 years. The court said this couldn‟t be a class action: 1-Common Questions Predominate element was not satisfied under (b)(3) -Interest of members of the class in individually controlling prosecution or defense of separate actions -There is no common question between the present claimants and the future claimants 2-There was no adequate representation 23(a)(4) -The present class was interested in current payout amount, and the future class would be interested in future payout amounts For a “settlement only” class action, you don‟t need to look at manageability problems, b/c there is not going to be a trial MIDTERM DISCOVERYDiscovery allows parties equal access to info and the ability to refine issues for trial. Under 23(b)(1) parties may discover any matter, not privileged, that is relevant to the claims or defenses of any party. Also, for good cause, the court may order discovery of any matter relevant to the subject matter involved in the action (it need not be admissible at trial if it is reasonably calculated to lead to the discovery of admissible evidence). Although privileged info is not open to discovery, privilege may be waived, either implicitly or explicitly. A Pretrial Process-Disclosure of facts related to claims and defenses of parties - Discovery often changes the way a party looks at a case, as details are uncovered -Purposes that discovery facilitates: 1- Trial preparation 2- Summary Judgment 3-Settlement Overview of the entire process of a suit -Substantive Law (e.g. contract) -This will tell us what elements are we need to fulfill -Procedural law -Disputed fact issues -Discovery law -Scope of discovery info -Evidence law -Relevance (will it tend to prove or disprove an issue of material fact) -Materiality (does it relate to the elements of the substantive law) The scope of discovery turns on what are the disputed issues of material fact (from complaint and answer) Rule 26(b)(1) Gives the parties a right to discover any matter, not privileged, which is relevant to the claim or defense of any party. -For good cause, the court may order discovery of any matter relevant to the subject matter involved in the action -Relevant info need not be admissible at the trial if the discovery appears reasonable calculated to lead to the discovery of admissible evidence -Privileged info is not open to discovery: ex. Atty/client, doc/pt, priest/parishioner, husband/wife, therapist/pt -But privilege can be waived, either implicitly or explicitly The question of relevance: Blank v. Sullivan & Cromwell- Pl‟s were female lawyers who were suing a firm for sex discrimination in hiring. The D firm refused to answer the interrogatories about their employees, female employees, promotion practices, etc. They said that this info wasn‟t relevant, that this was promotion practices and not hiring practices, and they were very different. -The court ordered that the interrogatories had to be answered. They ruled that: relevant info need not be admissible at the trial if the discovery appears reasonable calculated to lead to the discovery of admissible evidence -So the court allowed indirect proof Steffan v. Cheney- gay man discharged from Naval Academy. He had said he was a homosexual, but didn‟t say he engaged in the conduct. He then sued the gov saying the gov‟s practices were unconstitutional. The gov. wanted to ask him if he had committed an act. 18 The court held that this was not relevant. The issue (and scope of discovery) was whether he said he was a homosexual, not whether he had committed an act. -The court said the discovery about conduct was not relevant Rule 26 (b)(1) Scope -Must be relevant, and not privileged (atty/client) -Broad scope Stalnaker v. Kmart- pl suing D for sexual harassment. Pl wants to depose other employees about their experiences with the D, and whether they were sexually harassed. The D steps in and asks for a protective order (rule 26(c)), saying that their employees‟ voluntary romantic conduct or their sexual activities are irrelevant. -Court said that the witnesses could be deposed on issues relating to whether the D had sexually harassed them, but not on their voluntary romantic conduct or sexual activities. Rule 26(b)(2) Limits discovery that is: 1-unreasonably cumulative or duplicative, or is obtainable from some other source that is more convenient, less burdensome, or less expensive 2-the party seeking discovery has had ample opportunity by discovery in the action to obtain the info sought 3-the burden or expense of the proposed discovery outweighs its likely benefit, taking into account the needs of the case, the amount in controversy, the parties’ resources, the importance of the issues at stake in the litigation, and the importance of the proposed discovery in resolving the issues. (b)(3) Trial Prep/Work Product privilege There is a Qualified Privilege of documents & tangible things prepared for trial or in anticipation of litigation by another party or party’s representative (attorney; insurer). These are not discoverable unless there is: -Substantial need -Undue hardship (can’t get any other way) Things that are never discoverable include: -Mental impressions, conclusions, opinion, legal theories of atty, or other reps, such as insurance adjustors and investigators Hickman v. Taylor Pl sought to obtain the D‟s lawyer‟s notes that he had written down when he interviewed witnesses. -Court said that this info was work product privilege, under Rule 26(b)(3) -Court said this wasn‟t discoverable, as the pl could interview witnesses themselves, so they didn‟t have a substantial need or undue hardship, so the info was protected under work product Note: if a party or witness makes a written statement, then this is discoverable. -Also, facts are always discoverable If a witness dies, then a party may be able to discover the opposing party‟s notes of an interview of the witness. However, any lawyer impressions, conclusions, opinions, and legal theories will be blacked out. This usually occurs in a discovery hearing. Rule 26(b)(4) Experts says (A) Testifying Experts can be deposed (B) Non-testifying experts cannot be deposed except: - If, by Rule 35(b) (Report of Examiner), they prepared a written doc under order of the court, or - If the requesting party shows exceptional circumstances under which it is impracticable for the party seeking discovery to obtain facts or opinions on the same subject by other means -If the responding doesn‟t think the request is proper, they can move for a protective order (rule 26(c)) Rule 26 (c) governs protective orders. When discovery requests are improper the party being asked to provide the info can go to the judge to get a protective order. This is used for discovery requests that are an annoyance, embarrassment, oppressive, or require undue burden or expense. The rule requires the attorney to make a motion and to meet and confer in good faith with the requesting party. Then the judge can disallow the discovery altogether,, modify means, or require an entirely different way to get info. Also, under 37(a)4 you can be awarded costs and attorney fees associated with bringing the protective order motion. (d) Timing- no particular order to discovery required, but commonly interrogatories (rogs) go 1 st -You cannot have any more discovery (accept 26(a) until after the 26(f) meeting with the opposing atty. (e) Duty to supplement-you have to supplement your disclosures and responses if you get additional info -Usually there is a deadline to supplement before trial (usually 30 days) (f) Discovery conferences- must meet with opposing counsel to talk about discover within 14 days before you meet with the judge 19 -Imposed by judicial control -Help to set the discovery schedule (g) Signing certification -The discovery request conforms to discovery rules -Made for proper purpose -Not unreasonable or undue burden Attorney Client Privilege covers: 1- Confidential communications 2- Between attorney & client 3- Information & advice 4- Communication enhanced by confidentiality Facts are not protected, only communication between the attorney and client Who is client? 1-fed courts- Upjohn test-the court ruled that all employees were covered by the attorney/client privilege when the communication was related to the corporation’s legal matters. State courts2-control group test was used, meaning the management were the only ones covered under the attorney/client privilege. 3-there is also a control plus test, which includes employees who contributed to the situation (a nexus between the employee and the situation). This is a little broader than the control group test Types of Discovery: 1- Rule 26(a)(1) Required Disclosures (must be disclosed within 10 days of 26(f) meeting (this is mandatory) (A) Witnesses (B) Documents relevant to disputed facts (C) Anything having to do with computation of damages (D) Copies of Insurance policies -Rule 26(a)(1)(D) says insurance policies are discoverable Disclosures can be gotten rid of if the parties agree or the court orders it (very rare) 2-asking questions -Interrogatories- rule 33 (sending an opponent a list of questions to answer; limited to 25) -Limited to parties -Cheaper, but not as powerful, since questioner can’t follow up evasive answers -Depositions- rules 28, 30, 31, 32 (you get 10 depositions per suit) -Can be used on witnesses too -Expensive, but effective and focused 3-inspecting things and people -Production and inspection of documents and things (rule 34) -You can request from parties and subpoena from non-parties -Physical and Mental examinations (rule 34, 35) -Only for parties; must be for what led to accident -Pl waives right to decline it if they claim a physical or mental injury -Issue has to be in controversy Rule 35 Schlagenhauf v. Holder- bus crashed with a big rig truck. A passenger in the bus sued the bus co. and the truck co. The truck co. (a D) asked the court to allow a physical and mental examination of the truck driver (also a D). The D said that a D couldn‟t be ordered to undergo a mental or physical exam under rule 35, b/c he was a D. -The court ruled that rule 35 applied to D‟s and Pl‟s, but that the exam must be justified by showing that the issue is in controversy (example, a back injury of a pl in a personal injury case) and that the asking party has good cause for the examination. -Court also said that the exam doesn‟t have to be asked for by an opposing party. It could be a co-defendant You must have a court order under rule 35 for physical and mental exams, and it must be justified: -The issue must be in controversy -The asking party must have good cause (you must show a need) 4-admissions- rule 36 -It pairs down the disputed issues by asking the opponent to admit to make an issue non-disputable 20 Enforcement of Discovery with rule 37 Rule 37 is the primary rule governing sanctions, motions and orders for discovery. If the discovering party thinks the responding party is not following the rules, then they may move for an order compelling discovery under 37(a). Rule 37(a)(3)(A-C) list expenses and sanctions. If motion granted, the party whose conduct necessitated the motion will have to pay reasonable expenses and attorney fees of party making the motion). If motion is denied, the party making the motion must pay the other party’s reasonable expenses and fees, unless the making of the motion was substantially justified or other circumstances make an award of expenses unjust. If motion is granted in part and denied in part, court can reasonably apportion expenses. The sanctions available to the court are listed in 37(b)(2)(A-D) and 37(d) (A) Fact presumption order- if the party fails to allow discovery, then the facts will be presumed to be established for purposes of the lawsuit (B) Evidence preclusion- an order refusing to allow the disobedient party to provide evidence once they have disobeyed a discovery order (C) The court can strike pleadings and enter a default judgment (D) The party may be held in contempt of court (d) Failure of party to attend deposition or serve answers to interrogatories or respond to request for inspection, court can use the sanctions in (A), (B), or (C) of (b)(2) above Chudasama v. Mazda Motor Corp.- Dist. Court Judge didn‟t manage discovery well, and basically just let pl‟s attorney run it all. D attorneys filed motions that never got answered. Eventually the pl‟s attorneys made too many and too broad of requests, the D‟s didn‟t comply and the judge sanctioned them by having the pleadings stricken and entered default judgment for the pl. The appeals court overruled, saying that the judge mismanaged the entire thing. Judicial Management of Lawsuits 1- Discovery conferences (rule 26(f))-Parties must meet as ASAP but no later than 21 days before scheduling conferences are held w/judge 2- Pretrial conferences (Rule 16) (Rule 16(b) 3- Dismissal authority. Rule 41(b) -Judge can dismiss for failure to comply w/pretrial orders -Acts as an adjudication on the merits -EXCEPT for: -Lack of juris -Venue -Failure to join under 19 Rationales 1- reduce delays 2- increase efficiency 3-quicker trial dates 4-faster resolution of lawsuits Sanders v. Union Pacific Railroad Dismissal with prejudice of pl‟s lawsuits b/c lawyer failed to comply w/ pretrial orders. Judge did this sua sponte (on his own) -Affirmed by panel, but then en banc reversed Rule 16 Pretrial conferences; scheduling; management of trial In any action, the court may in its discretion direct the attorneys for the parties and any unrepresented parties to appear before it for a conference or conferences before trial. (a) Objectives of pretrial conference (b) Scheduling & planning (c) Subjects for consideration at pretrial conferences (d) Final pretrial conference (e) Pretrial orders- this order shall control the subsequent course of the action unless modified by a subsequent order (McKey case) -The pretrial order under Rule 16(e) fixes the theories that can be tried -The order following a final pretrial conference shall be modified only to prevent manifest injustice. -When would manifest injustice allow a change? -New law passed by legislature, mistake, excuse, etc. (f) Sanctions Mckey v. Fairburn Slip and fall lawsuit (lady slipped on wet floor in her apt) Pl=tenant and D=landlord 1- common law lease-there was not duty of LL to repair 2- statutory housing code theory was introduced later in the suit 21 There was a directed verdict for D, which was upheld on appeal b/c the 2nd theory was not within the scope of the pretrial hearing, and the district court did not abuse discretion Right to Jury Trial in civil cases 7th Amendment The Seventh Amendment preserves the right to a jury trial in actions at common law where the amount in controversy exceeds $20. Under rule 38 this right is preserved, but a party must make a demand for the right to trial by jury, otherwise the privilege is waived. At common law, for the right to jury trial to apply, the suit had to be brought as a legal claim - a claim recognized by a court of law in 1791. If brought in equity, a judge sat because there had never been a right to jury trial in equity and therefore there was nothing to preserve. Between 1791 and 1938, the Historical Preservation test was most widely used. The rule was the 1st to file claim got to pick whether he would sue in law or equity. So if you wanted to avoid jury trial, you would just pick declaratory or injunctive remedies. (Stewart case). In 1938, rule 38 merged law and equity. Post 1938 the right to jury trial is analyzed in 4 ways: For simple cases: 1- The historic approach is used, and if an action would have had a right to jury in 1791, then a jury is used today. For more complex, modern cases: 2-In cases where we have a new cause of action, courts look at: 1-the nature of the new issues and compare the new action to historically analogous causes of actions in the 18 th century English courts before the merger of law and equity 2- the remedy sought by the pl and decide whether the remedy is legal or equitable (this factor is more weighty than the nature of the issues) 3-In hybrid claims, where you have a legal claim and an equitable claim, you use the Postmerger/expansionist approach 1-Priority given to claims for legal relief: these are tried by jury 1st 2-Decision on these issues is controlling for rest of lawsuit; once jury decides claims, then judge can decide any undecided issues relating to equitable claims -If a historically equitable claim includes any damages, then courts will tend to say the 7 th Amendment right to trial applies -But this principle (claims go to jury 1st) does not apply when there is a final judgment in prior lawsuit Ex. Parklane Hosiery (where SEC had already made final judgment, the D was later not allowed to retry it before a jury for it to be controlling in a later case where it was D -The right to jury trial does not apply to prior adjudicated trials that have come to final judgment -Also, if the parties file in different states, or in different systems, then it is possible for a trial before judge to happen before a trial before jury (but this is not usually what happens) 4-when you have new procedures, particularly the rise of administrative agencies that have adjudicatory powers, the parties typically do not have a right to a jury trial, and the case will be heard by an ALJ. Starting in the late 19th century, with the founding of the Interstate Commerce Commission (ICC), and continuing through the 20th century, Congress and state legislatures have created admin agencies whose purpose is to enforce statutes enacted by Congress. Examples are the SEC, EPA, OSHA, and others. Most have the power to decide cases under their governing statute, using an administrative hearing procedure that is governed by administrative procedure acts. Admin agencies do not use juries, but admin law judges (ALJ’s), that hear cases and render decisions. Some agencies, such as state worker comp agencies, or OSHA, have the authority to award the equivalent of tort damages (WCAB), or money penalties (OSHA). The constitutionality under the 7th Amendment of these administrative processes was upheld under Atlas Roofing. The Supreme Court reasoned that Congress could delegate fact finding authority in admin agencies that did not use juries in public rights cases, such as when Congress is regulating an industry under the commerce clause power, but not in private rights cases, such as common law private party tort and K litigation. It is important to note that Congress can utilize this exception when it places adjudicatory decision making exclusively in the agency, but when judicial authority is vested in a courtroom, whether an Article III courtroom or not, the right to jury trial applies. Basics: 1-common law lawsuits 2-amount in controversy > $20 3-jury trial right preserved (notice it wasn‟t granted, b/c it was already being used by the people) Rationales for Jury Trial 1-democratic decision-making 2-standards of community 3-protections against tyranny 22 When Does Jury Trial Right Apply? 1- common law -Law courts (jury) v. equity courts (judge) 2-preservation -Focus on historical practices in 1791 (asks, what would they have done in 18th century?) Pre-1938 Practice (Historical Approach) -We had law and equity side of the court. The choice of which side the party chose to sue in dictated whether it would be heard by judge or jury -1st to file Rule: 1st to file claim got to pick whether he would sue in law or equity. So if you wanted to avoid jury trial, you would just pick declaratory or injunctive remedies. (Stewart case) Post 1938- new FRCP, and law and equity merged To analyze whether there is a right to jury trial, classify remedies as legal (jury) or equitable (no jury): 1-K‟s -Money damages=legal -Specific performance=equitable -Rescission =equitable -Reformation=equitable 2-torts -Money damages=legal -Injunction=equitable 3-personal property -Money damages=legal -Possession (replevin)=legal 4-real property -Money damages=legal -Possession (ejectment)=legal (ex. return of a ring) 5-restitution -Money (quasi-K)=legal -Constructive trust=equitable -Equitable lien=equitable -Profits from fraud=equitable -Restitution with rescission=equitable *Back pay is considered equitable 1-For simple cases, just use the above chart and decide what the remedy is and whether jury is used More complex Cases include the following 3 areas 2- when you have a new cause of action that didn‟t exist in 1791 3- when you have new procedures, particularly the rise of administrative agencies that have adjudicatory powers 4-changes in judicial procedures, including the problem of hybrid cases, in which both legal and equitable remedies are sought in the same case 2- A new cause of action Example: Chauffers v. Terry- Duty of fair representation by the union So in cases where we have a new cause of action, courts look at: 1-the nature of the new issues and compare the new action to historically analogous causes of actions in the 18 th century English courts before the merger of law and equity 2- the remedy sought by the pl and decide whether the remedy is legal or equitable (this factor is more weighty than the nature of the issues) Rule 38 (copy from pg. 108 of Rules) Demand for jury trial Rule 38(a) says the right of jury trial is preserved Rule 38(b) demand -You have to demand a jury trial or it is waived. (copy from pg. 108 of Rules) (c) Identify issues (d) If you don‟t demand, you waive 23 So you have to identify the issue that is correct for a jury trial, then perfect it under Rule 38 3- when you have new procedures, particularly the rise of administrative agencies that have adjudicatory powers -Starting in the late 19th century, with the founding of the Interstate Commerce Commission (ICC), and continuing through the th 20 century, Congress and state legislatures have created admin agencies whose purpose is to enforce statutes enacted by Congress. Examples are the SEC, EPA, OSHA, and others. Most have the power to decide cases under their governing statute, using an administrative hearing procedure that is governed by administrative procedure acts. Admin agencies do not use juries, but admin law judges (ALJ‟s), that hear cases and render decisions. Some agencies, such as state worker comp agencies, or OSHA, have the authority to award the equivalent of tort damages (WCAB), or money penalties (OSHA). The constitutionality under the 7 th Amendment of these administrative processes was upheld under Atlas Roofing. The Supreme Court reasoned that Congress could delegate fact finding authority in admin agencies that did not use juries in public rights cases, such as when Congress is regulating an industry under the commerce clause power, but not in private rights cases, such as common law private party tort and K litigation. It is important to note that Congress can utilize this exception when it places adjudicatory decision making exclusively in the agency, but when judicial authority is vested in a courtroom, whether an Article III courtroom or not, the right to jury trial applies. 4-changes in judicial procedures, including the problem of hybrid cases, in which both legal and equitable remedies are sought in the same case Postmerger/expansionist approach--priority given to right to jury trial (this is the Beacon Theatres case) Beacon Theatres -Pl seeks declaratory and injunctive relief -D counterclaims for damages under antitrust laws (treble damages) In hybrid claims, where you have a legal claim and an equitable claim: 1-Priority given to claims for legal relief: these are tried to jury 1st 2-Decision on these issues is controlling for rest of lawsuit; once jury decides claims, then judge can decide any undecided issues relating to equitable claims -But this principle (claims go to jury 1st) does not apply when there is a final judgment in prior lawsuit -Ex. Parklane Hosiery (where SEC had already made final judgment, the D was later not allowed to retry it before a jury for it to be controlling in a later case where it was D -The right to jury trial does not apply to prior adjudicated trials that have come to final judgment -Also, if the parties file in different states, or in different systems, then it is possible for a trial before judge to happen before a trial before jury (but this is not usually what happens) Note: if a historically equitable claim includes any damages, then courts will tend to say the 7th Amendment right to trial applies Example of Hybrid: Amoco Oil v. Torcomian-Pl owns service station, and D was supposedly the new franchisee. However, Pl filed suit, seeking equitable and legal damages. Then they tried to eliminate the legal remedy so that they didn‟t have to have a jury trial. The D counterclaimed with equitable and legal claims. The court had a bench trial. The court here overturned it, saying that there should be a jury trial 1st Harmless error by trial court is not reversible. -Harmless error is if you would have gotten the same result with jury -You test this by asking if there would have been a directed verdict. -Here, there were issues of credibility of witnesses, so the jury would have to have made this decision Why are juries so important? -Anti-big corporation -Pro average person -Swayed by emotion -More generous with awards -Also, being a juror helps people know what is going on in the justice system -Also, it helps people think they are members of societal justice Atlas Roofing- OSHA statute (workplace safety regulatory statute enforced by administrative agency) -Admin agency can give: -Civil penalties- to be an incentive for companies not to have unsafe work places -Abatement orders -This is done with an adjudication in front of an Administrative Law Judge (ALJ) as decision maker. Then it can be appealed to a board and finally to the court of appeals. The corporation argued they should get a jury trial, but the court disagreed. The court said that: -The 7th applies to common law cases, not new administrative cases that Congress 24 1- in public rights cases, 2-before an administrative agency adjudication, -There is no 7th Amend right to a jury trial Rise of Administration Agencies: 1887 ICC 1914 FTC 1930‟s SEC, FCC, CAB, NLRB, SSA Approach for cases: Private Rights cases: Use the modern approach -Private rights-historically are common law, but some statutes codify common law, such as the UCC. -For private rights it is usually 2 individuals or corporations Public Rights cases: Public rights means rights created under an administrative agency (ex. The right to clean air given by the EPA; the right to a safe workplace created by OSHA; the right to collect SS) Public rights usually involve an administrative agency (gov as a litigant vs. a regulated industry) 1-if the adjudication goes to district court: then use the modern approach (nature of issue and remedy sought) (jury for damages, and judge for equitable relief) 2-if the adjudication is in the agency: use the Atlas analysis: if the administrative agency is given power by congress to adjudicate, then the case will be heard by ALJ Back pay is considered equitable So to determine if they are public or private rights, ask: 1-who the litigants are (is one an administrative agency?) 2- is there a regulatory statute? Choosing Juries Voir Dire- questioning of jurors Removing jurors for cause (if they have a conflict, know the parties or lawyers, work for the company, etc. -if the juror has a perspective that will not allow him to be objective, he will be Peremptory Challenges-allows lawyers to excuse a juror w/o cause Edmundson v. Leesville Concrete -D used peremptory challenges to remove black jurors. The Pl challenged, saying that this violated the equal protection clause. -The court said that the jury process is a public decision process, and that: -if a party can show a pattern (at least 2) of race or gender discrimination, -Then the burden shifts to the party using peremptory challenge to show he had a basis for using his challenge other than race or gender THE JUDGE -Right to Impartial Decision Maker 1- Due Process of Law - If judge has a financial interest, then he is automatically out -Judges salary can „t be paid by the fines imposed - Judge was mayor of town, and his fines went into the town budget -This disqualified them - Judge had a personal stake in the claim - Judge was hired by the county to hear case and was hired by the prosecutor. This showed a prosecution bias 2-ABA code of judicial conduct also governs the impartial decision maker 3-statutory law also governs the impartial decision maker Really breaks down into 2 things: 1- Recusal of judge by himself § 144. Bias or prejudice of judge -Whenever a party to any proceeding in a district court makes and files a timely and sufficient affidavit that the judge before whom the matter is pending has a personal bias or prejudice either against him or in favor of any adverse party, such judge shall proceed no further therein, but another judge shall be assigned to hear such proceeding. -The affidavit shall state the facts and the reasons for the belief that bias or prejudice exists, and shall be filed not less than ten days before the beginning of the term at which the proceeding is to be heard, or good cause shall be shown for failure to file it within such time. A party may file only one such affidavit in any case. It shall be accompanied by a certificate of counsel of record stating that it is made in good faith. 2- Party will move to disqualify the judge § 455. Disqualification of justice, judge, or magistrate judge 25 (a) Any justice, judge, or magistrate judge of the United States shall disqualify himself in any proceeding in which his impartiality might reasonably be questioned. (b) He shall also disqualify himself in the following circumstances: -These things give the appearance of impropriety (1) Where he has a personal bias or prejudice concerning a party, or personal knowledge of disputed evidentiary facts concerning the proceeding; (2) Where in private practice he served as lawyer in the matter in controversy, or a lawyer with whom he previously practiced law served during such association as a lawyer concerning the matter, or the judge or such lawyer has been a material witness concerning it; (3) Where he has served in governmental employment and in such capacity participated as counsel, adviser or material witness concerning the proceeding or expressed an opinion concerning the merits of the particular case in controversy; (4) He knows that he, individually or as a fiduciary, or his spouse or minor child residing in his household, has a financial interest in the subject matter in controversy or in a party to the proceeding, or any other interest that could be substantially affected by the outcome of the proceeding; (5) He or his spouse, or a person within the third degree of relationship to either of them, or the spouse of such a person: (i) Is a party to the proceeding, or an officer, director, or trustee of a party; (ii) Is acting as a lawyer in the proceeding; (iii) Is known by the judge to have an interest that could be substantially affected by the outcome of the proceeding; (iv) Is to the judge's knowledge likely to be a material witness in the proceeding. (c) A judge should inform himself about his personal and fiduciary financial interests, and make a reasonable effort to inform himself about the personal financial interests of his spouse and minor children residing in his household. (d) For the purposes of this section the following words or phrases shall have the meaning indicated: (1) "Proceeding" includes pretrial, trial, appellate review, or other stages of litigation; (2) The degree of relationship is calculated according to the civil law system; (3) "Fiduciary" includes such relationships as executor, administrator, trustee, and guardian; (4) "Financial interest" means ownership of a legal or equitable interest, however small, or a relationship as director, adviser, or other active participant in the affairs of a party, except that: (i) Ownership in a mutual or common investment fund that holds securities is not a "financial interest" in such securities unless the judge participates in the management of the fund; (ii) An office in an educational, religious, charitable, fraternal, or civic organization is not a "financial interest" in securities held by the organization; (iii) The proprietary interest of a policyholder in a mutual insurance company, of a depositor in a mutual savings association, or a similar proprietary interest, is a "financial interest" in the organization only if the outcome of the proceeding could substantially affect the value of the interest; (iv) Ownership of government securities is a "financial interest" in the issuer only if the outcome of the proceeding could substantially affect the value of the securities. (e) No justice, judge, or magistrate judge shall accept from the parties to the proceeding a waiver of any ground for disqualification enumerated in subsection (b). Where the ground for disqualification arises only under subsection (a), waiver may be accepted provided it is preceded by a full disclosure on the record of the basis for disqualification. (f) Notwithstanding the preceding provisions of this section, if any justice, judge, magistrate judge, or bankruptcy judge to whom a matter has been assigned would be disqualified, after substantial judicial time has been devoted to the matter, because of the appearance or discovery, after the matter was assigned to him or her, that he or she individually or as a fiduciary, or his or her spouse or minor child residing in his or her household, has a financial interest in a party (other than an interest that could be substantially affected by the outcome), disqualification is not required if the justice, judge, magistrate judge, bankruptcy judge, spouse or minor child, as the case may be, divests himself or herself of the interest that provides the grounds for the disqualification. Under (a) judge doesn‟t have to have actual knowledge (just need to have appearance of impropriety) -A violation of § 455(a)--which requires a judge to disqualify himself in any proceeding in which his impartiality might reasonably be questioned--is established when a reasonable person, knowing the relevant facts, would expect that a judge knew of circumstances creating an appearance of partiality, notwithstanding a finding that the judge was not actually conscious of those circumstances. TRIALS Fact Finding process: 1-questions /issues of basic fact (jury decides (if it is a jury trial)) -From out of court events -You get these from the pleading process and discovery process (from both pl‟s case and affirmative defenses) 2-questions/issues of law (Judge decides) -What substantive law applies to these facts? -Some of this is determined by a lawyer and what claim he chooses to bring. -The judge then gives the instruction to the jury 26 3-question/issues of application of law to fact (jury decides (if it is a jury trial)) -Law applied to fact by the jury -What does the jury do with the instructions they get from the judge? Examples of the above: 1-What was the color of the traffic light when D entered intersection? -What happened? 2-Does the law of negligence apply to car accidents? -What is the legal significance of what happened? 3-Does driving a car into an intersection against a red light constitute negative driving? BURDEN OF PROOF 1-Burden of production -Focuses on who has the responsibility of coming forward with proof -Requires a party to produce, to find and present evidence to support each element of the prima facie case (or affirmative defense) 2-burden of persuasion (looks at the quality or persuasiveness of the evidence produced) -Preponderance of evidence (more probable than not) (normal civil std) -Clear & convincing evidence (used for fraud cases, trying to take away a physicians license, cases that have a severe civil penalty, etc) -Beyond a reasonable doubt (highest level of persuasion) (criminal standard) ISSUES OF CREDIBILITY OF WITNESSES Who will the jury believe, and to what extent? Factors: 1-demeanor of witness evidence is weighed by the jury/judge 2-consistency of the witnesses statements Reid- gate of fence left open, and a cow got hit by a train. The fence had a hole in it, and the RR had responsibility to keep it in repair. The RR was negative in not maintaining fence. However, since the gate was left open, it was impossible to tell if the neg fence caused the cow to get hit. Therefore, the court ruled for a directed verdict. RULE: where the undisputed evidence of the pl, from which the existence of an essential fact is sought to be inferred, points with equal force to two things, one which renders the D liable and the other not, the pl must fail. -Burden of persuasion was on pl to show that it was more probable than not that the cow went through the hole in the fence. The best they could show was that it was equally as likely. Therefore, they lose -Directed verdict: a rational trier of fact couldn’t have reached a verdict for the pl based on the evidence Pennsylvania RR v. Chamberlain- worker killed at train yard. Most witnesses said that the train cars didn‟t collide. One witness said he “heard” a loud collision, and inferred that the cars collided and the man was killed in this collision. However, he was 900 ft away, and didn‟t see it. -Where there is a direct conflict of testimony upon a matter of fact, the question must be left to the jury to determine w/o regard to the number of witnesses on each side. -When the evidence tends equally to sustain either of 2 inconsistent propositions, neither of them can be said to have been established by legitimate proof. A verdict in favor of the party bound to maintain one of those propositions against the other is necessarily wrong. RULE 50 JUDGMENT AS A MATTER OF THE LAW Rule 50 governs Judgments as a Matter of Law (JML) and says that a party seeking to attack the jury verdict based on insufficient evidence may seek a JML in which the judge will determine if the jury, using the reasonable jury standard, was correct in its verdict as a matter of law. The party seeking to set aside a jury verdict has several options. -First, a directed verdict is available in which a party may ask the judge to determine as a matter of law the holding without sending the jury to deliberate. During a trial by jury, if a party has been fully heard on an issue, and there is no sufficient legal basis for a reasonable jury to find for the party on that issue, the court may determine the issue as a matter of law pursuant to rule 50(a). -Second, the party may seek a post-verdict JML in which they ask the judge to say that there was only one reasonable way for the jury to find and they did not find it. However, rule 50(b) requires that for a party to seek a post-verdict JML, aka JNOV, they must have first raised a pre-verdict JML, directed verdict. At the same time, the party should alternatively seek a MNT in which the party is asking the judge for a new trial. Rule 59 governs when a judge can issue a new trial and states that it must be requested within 10 days of the verdict and can be granted on the grounds of flawed procedures or unsupported verdicts based on the great weight of the evidence standard. MNT is within the discretion of 27 a judge and his decision to order one is given deference by the appellate court and won't be set aside unless they are clearly erroneous. The court is not supposed to overturn the jury's verdict when it is based on the credibility of a witness. Conditioned New Trails are also available if a party or court believes that a jury got it right but didn't award the right amount. They either ordered too little in which an additure can be granted (but it is not permissible in federal court and wouldn't apply to the instant case). Or a remitture can be granted if the jury verdict is too high in which H can either take the lesser amount or go to a new trial for damages Judgment as a matter of law (Directed Verdict) Rule 50 -Party can move for a directed verdict at anytime before case is given to jury -If reasonable minds could not differ, then the judge can rule for a directed verdict -Grounds for the motion is that the evidence presented would support only 1 result -There is no legally sufficient evidentiary basis for a reasonable jury to find for that party on the issue Judgment as a matter of law Rule 50 (judgment entered for the verdict loser) (a) Pre-verdict judgment as a matter of law (Directed Verdict) -Case taken from the jury, and this happens when: - No reasonable jury could reach a verdict for PL/D -Ex. If the pl‟s case is weak and he did not prove elements -Ex. If the D provided no defense and the pl‟s case is established -Note, to ask for a JNOV later on, the party must have raised a pre-verdict JML (b) Post-verdict judgment as a matter of law (JNOV) -No reasonable jury could reach a verdict for PL/D -Party should bring alternate motions, JNOV & Motion for New Trial (MNT), which can be brought together. You bring both motions b/c you are not sure which will win. (c) Granting JML & alternate motions MNT -Court allows alternative motions (d) Denying JML & alternate motions MNT Rule 59 Motions for new trials Traditional grounds 1-procedural errors caused a flawed verdict -Here, we say the jury verdict was flawed by procedural error -Jury misconduct (ex. Juror trying to do experiment at home, juror visiting scene -Judge makes a mistake and allows in evidence he shouldn‟t have; or gives an improper jury instruction -Lawyer mistakes, prejudicial statement by counsel -Litigant mistakes 2-verdict against the weight of evidence -Here, we think the jury made a mistake, but not such an error that would allow a JNOV. So we send back for a new trial. -When evaluating the witnesses and their evidence, judges should look at: -Witness demeanor, consistency of testimony, and plausibility of the testimony Evidence is strong for Pl----------------------------------------Evidence is strong for D JML MNT balanced MNT JML Federal Rules of Evidence 606 (b)- Impeachment of Jury Verdicts -A judge cannot impeach a jury verdict based upon the deliberation process of the jurors or the mental processes of the jurors -However, a jury verdict can be impeached by evidence of outside influences, external conduct -Ex. Bailiff trying to bribe a jury member Normally, 606(b) is brought up in the context of the losing party asking for a new trial, not by a judge APPELLATE PROCESS The Court of Appeals has the authority to hear appeals from final judgments of the district courts under 28 USC 1291. Final judgments include decisions of the trial court (TC), which decide all aspects of the case and in which there are no further decisions to be made. Final judgments don't occur until the completion of the trial process. The party must have standing to assert the right and the decision must have adversely affected the party in order for the party to claim the appeal. Furthermore, the party must have raised an objection in TC before an appeal can be heard, if they do not, they have waived their right to appeal. There are five exceptions to the final judgment rule: 28 -Partial final judgment (rule 54b), which occurs when you have judgment upon multiple claims or multiple parties, and the judge enters final judgment as to one or more but fewer than all of the claims or parties. The purpose of the exception is to allow an appeal without having to wait for the other party to resolve all other issues. -The collateral order doctrine (1291) says that for a collateral order to be reviewable it must be final (will not be reconsidered in trial court), collateral, meaning it has nothing to do with the merits of the case (ex. Where you sue), and unreviewable on appeal. Examples are issues of absolute or qualified immunity (the right not to stand trial). These would be unreviewable on appeal, so is a collateral order that would be able to be appealed right away) The next 3 are Interlocutory appeals, meaning there has been no final judgment -Injunction orders (1292a): typically applies to preliminary injunctions, which are immediately reviewable to avoid possible inequity. -Certification (1292b): exception requires a controlling question of law as to which there is a substantial differing of opinion, and an immediate appeal may materially advance the ultimate termination of the litigation. -Mandamus (1691) is a very narrow exception and is applied when a judge abuses his power and the appellate court issues a writ requiring the judge to perform an act required by law. An example would be if a trial judge denied a trial by jury when the law necessitated it, so a writ of mandamus would be given before a final judgment was rendered When to appeal: 1-final judgment rule (28 USC § 1291) p. 306 Was it a final judgment? Liberty Mutual -S.Ct. vacated court of appeal and ordered dismissal of appeal from district courts decision -No final judgment if just liability is determined but remedies have not been awarded. 2-partial final judgment (FRCP rule 54(b)) -Judgment upon Multiple Claims or involving multiple parties -Judge can enter final entry of a final judgment as to one or more but fewer than all of the claims or parties 3-colleteral orders (§ 1291 Interp) -Lauro Lines v. Chasser -Collateral order doctrine: Order denying motion to dismiss based on contractual forum on contractual forum selection clause not a collateral order. -For a collateral order to be reviewable, it has to be: 1-the order has to be final (will not be reconsidered in trial court) 2-the order has to be collateral, meaning it has nothing to do with the merits of the case (ex. Where you sue) 3-the order has to be unreviewable on appeal -Such as issues of absolute or qualified immunity (the right not to stand trial) (this would be unreviewable on appeal, so is a collateral order that would be able to be appealed right away) -In this case, they failed on element 3; this order, to not uphold the forum selection clause, was reviewable, so it failed Interlocutory Appeals (an order of appeal in a pending case where there is no final judgment) (these are exceptions to having to have a final judgment to appeal) 4-Injunction Orders (§ 1292(a)) -Typically applies to preliminary injunctions, b/c final injunctions would be part of a final judgment, so there would be no need to use this exception. 5-Certification (§ 1292(b)) A. Controlling question of law B. Substantial differing of opinion C. Materially advance termination of litigation 6-Mandamus (§ 1651) -Very narrow -Beacon Theaters v. Westover -a writ of mandamus, obtained in an original proceeding in the court that issues the writ, orders a public official to perform an act required by law. The public official may be a judge of a lower court. In Beacon, the trial judge denied a trial, so a writ of mandamus was given. This will allow an interlocutory appeal. Standard of Scope of Review -how closely the appellate court will evaluate the trial court Questions of Law (const., statutes) Questions of fact Questions of discretion 29 --------------------------------------------------------------------------------------------- Independent judgment Clearly Substantial Abuse of Discretion Or de novo review erroneous evidence (judge) (jury) (aministra agencies) basic facts or ultimate facts Broadest, least deferential Narrowest, most deferential Appellate court better suited to make decision Trial court better suited to make decision Under questions of fact in above chart, if the judge makes a decision, then the appellate court will look at the basic facts and will uphold them unless they are clearly erroneous. If the jury made the decision, then the decision will be upheld if they had reasonably substantial evidence. 30