Civ Pro: Lifecycle of a Lawsuit Questions Flashcards
Golfco, a golf course management company, adopted a hiring plan designed to increase gender diversity in its workforce. Pursuant to this plan, the plaintiff, a male groundskeeper, was rejected for a promotion in favor of a female applicant. During a Golfco tournament two days later, the plaintiff and several co-workers walked the sidelines chanting loudly “Golfco discriminates!” All were fired the next day. The plaintiff sued in federal court for retaliation under the federal anti-discrimination laws, alleging all of the above facts and stating, “I was terminated solely on account of complaining about sex discrimination and not for any legitimate business reason.” Assume that it is common knowledge that golf tournaments require spectators to keep quiet avoid distracting golfers. Golfco files a motion to dismiss the plaintiff’s complaint for failure to state a claim under Rule 12(b)(6).
How should the court rule on Golfco’s motion?
(A) The court should grant the motion, because the plaintiff’s allegations, taken as true, along with common knowledge, suggest an obvious alternative legal explanation for his termination.
(B) The court should grant the motion, because the complaint’s allegations are entirely conclusory.
(C) The court should deny the motion, because discrimination is the most likely explanation for the plaintiff’s termination.
(D) The court should deny the motion, because every litigant who files a complaint is entitled to get discovery.
A is correct because it accurately states the current pleading standard under Rule 8(a)(2) as interpreted by Bell Atlantic v. Twombly and Ashcroft v. Iqbal. This answer also accurately applies that standard to the complaint’s allegations. Even taking the specific factual allegations as true, the complaint alleges that the plaintiff engaged in behavior that, according to common knowledge, is unacceptably disruptive. Because Iqbal permits “judicial experience and common sense” to inform the Rule 8(a)(2) analysis, in light of this common knowledge, the complaint does not sufficiently allege that the plaintiff was fired “solely” for reporting discrimination. The “obvious alternative legal explanation” is that he was terminated for being unacceptably disruptive—particularly since the complaint says that all of the participating co-workers were fired along with him.
B is incorrect because the complaint’s allegations are fact-specific about many of these events giving rise to the lawsuit; they are not “entirely” conclusory.
C is incorrect because it states the wrong legal standard. The question is not whether the complaint makes discrimination the “most likely” explanation; rather, the question is whether the well-pled allegations, taken as true, support a reasonable inference of illegal conduct.
D is incorrect. It contradicts Rule 8(a)(2) as well as the authoritative decisions interpreting that rule on 12(b)(6) motions.
Apex Corp. sued Bemis Corp. for breach of contract under federal diversity jurisdiction in the Southern District of Illinois. In response to the complaint, Bemis filed a timely Rule 12(b)(3) motion to dismiss for improper venue. The court denied the motion. Bemis then filed its answer, raising two defenses: (1) lack of personal jurisdiction under Rule 12(b)(2); and (2) failure to state a claim upon which relief can be granted under Rule 12(b)(6). Apex filed a Rule 12(f) motion to strike both defenses.
How should the court rule on Apex’s motion?
(A) The court should deny Apex’s motion to strike both defenses.
(B) The court should deny Apex’s motion to strike the personal jurisdiction defense but grant Apex’s motion to strike the failure to state a claim defense.
(C) The court should grant Apex’s motion to strike both defenses.
(D) The court should grant Apex’s motion to strike the personal jurisdiction defense but deny Apex’s motion to strike the failure to state a claim defense.
D is correct. Personal jurisdiction is a waivable defense that must be raised in the defendant’s first response. Rules 12(g)(2), 12(h)(1). In contrast, failure to state a claim can be raised later: in an answer, a 12(c) motion for judgment on the pleadings, or at trial. Rule 12(h)(2). Here, Bemis’ first response was a Rule 12(b)(3) motion challenging venue. The personal jurisdiction defense should have been raised in the same motion because it was available at the time. By omitting that defense, Bemis waived it and cannot belatedly raise it in the answer.
A is incorrect because it is proper to strike an “insufficient defense” under Rule 12(f)—here the personal jurisdiction defense is insufficient because it has been waived.
B is incorrect because it has matters backwards. The failure to state a claim defense can be raised later in the litigation, while the personal jurisdiction defense must be in the defendant’s first response.
C is incorrect because the failure to state a claim defense can be raised for the first time in an answer even if the defendant has filed a Rule 12(b) motion on other grounds.
Plaintiff is the owner of a company that rents ski equipment. Defendant is a college student who writes a weekend column in the student newspaper about sports events. Defendant wrote an uncomplimentary article about Plaintiff’s company, stating that the rental equipment “was old, shoddy, and dangerous.” In response, Plaintiff filed a diversity action in federal court against Defendant alleging libel and seeking $300,000 in damages and reasonable attorney’s fees. Defendant failed to appear. Plaintiff submitted an affidavit showing Defendant’s failure and the clerk entered a default.
Can the clerk also enter a default judgment?
(A) No, only the judge can enter the judgment and must make an independent determination of damages.
(B) Yes, the clerk can enter the judgment if Plaintiff submits an affidavit stating a sum certain for damages.
(C) The entry of default automatically converts into a judgment of default if Defendant fails to object.
(D) Yes, the clerk can enter the judgment after Defendant has been served with written notice of the application at least seven days before a hearing.
(A) is correct because under the federal rules, only the court can enter a default judgment if plaintiff’s claim is not “for a sum certain or a sum that can be made certain by computation.” FRCP 55(b)(1). When there is any doubt about the amount of damages, then only the court can enter the judgment. See FRCP 55(b)(2). Although the complaint contains an ad damnum clause, the amount of damages here are not a “sum certain” in the sense contemplated by FRCP 55. See KPS & Assocs., Inc. v. Designs By FMC, Inc., 318 F.3d 1, 19 (1st Cir. 2003) (“in the Rule 55 context, a claim is not a sum certain unless there is no doubt as to the amount to which a claimant is entitled as a result of the defendant’s default”, stating that the court cannot award the amount of the ad damnum clause in the complaint when the proper amount is uncertain). The usual example of a dispute involving a sum certain, in which resort to “extrinsic proof” is not needed to determine damages, is an action to enforce a money judgment or a negotiable instrument. Id. When the complaint does not involve a sum certain, the federal rule provides that the party seeking judgment must apply to the court for the entry of a default judgment, and the court may hold a hearing “to determine the amount of damages” or to “investigate any other matter.” FRCP 55(b)(2). It is not clear without further evidence whether the $300,000 that Plaintiff has alleged is the appropriate amount in damages for the libel; moreover, the amount of a reasonable attorney’s fee remains disputed.
(B) is not correct because although the federal rule permits the clerk to enter a default judgment for liability and damages, the clerk may do so only if it is clear from the complaint, without resort to extrinsic evidence, that the damages sought are for a sum certain. See FRCP 55(b)(1). Even if for a sum certain, a default judgment may be entered only if two other conditions are met: it must be shown that “defendant has been defaulted for not appearing”; and defendant “is neither a minor nor an incompetent person.” Id. Thus, in addition to the sum-certain requirement that damages be “capable of simple mathematical computation,” the clerk may enter judgment only against “parties who have never appeared in the action.” Franchise Holding II, LLC. v. Huntington Rests. Group, Inc., 375 F.3d 922, 928-929 (9th Cir. 2004), and are not entitled to the protection afforded to minors and incompetents.
(C) is not correct because it misstates the rule pertaining to how the entry of default becomes a default judgment. The entry of default does not automatically convert into a judgment; rather, the federal rule “provides a two-step process for obtaining a default judgment,” and either the clerk or the court must enter the judgment. See New York v. Green, 420 F.3d 99, 104 (2d Cir. 2005); FRCP 55 (b). An entry of default is a notation made by the clerk after the party seeking the default submits an affidavit showing that a party has “failed to plead or otherwise defend.” See FRCP 55(a). The entry “formalizes a judicial recognition that a defendant has, through its failure to defend the action admitted liability to the plaintiff; the entry is not an admission of damages”; the entry of a default judgment “converts the defendant’s admission of liability into a final judgment that terminates the litigation and awards the plaintiff any relief to which the court decides it is entitled…” City of New York v. Mickalis Pawn Shop, LLC, 645 F.3d 114, 128-129 (2d Cir. 2011).
(D) is not correct because it misstates the timing and other requirements for the entry of a default judgment following the entry of default. In cases where only the judge can enter the judgment, see FRCP 55(b)(2), the federal rule provides that a party who “has appeared personally or by a representative … must be served at least 7 days before the hearing” on the application. Id. However, the seven-day rule is not implicated when the clerk enters the judgment. See FRCP 55(b)(1).
BigTech, Inc. sued one of its former software developers in federal district court for copyright infringement and for violating a noncompete agreement. The court took federal question jurisdiction over BigTech’s federal copyright claim and took supplemental jurisdiction over BigTech’s noncompete claim, which is governed by state statutory law. Eight months after the lawsuit was filed, the legislature in the state where the case arose and was filed passed a law making noncompete agreements illegal. The law was retroactive, applying to noncompetes signed even before the law’s passage. After the law was passed, BigTech argued the noncompete claim’s merits in its written response to the former employee’s summary judgment motion. Assume the law’s retroactivity does not pose any constitutional due process problems.
Which of the following is true about Rule 11’s application to BigTech’s summary judgment response?
(A) BigTech violated Rule 11(b)(2)’s requirement that legal contentions be warranted by existing law or by a non-frivolous argument for changing the law.
(B) BigTech violated Rule 11(b)(3)’s requirement that factual contentions have evidentiary support.
(C) BigTech did not violate Rule 11(b)(2) or 11(b)(3), because its noncompete claim has sufficient factual and legal support.
(D) BigTech did not violate Rule 11(b)(2) or 11(b)(3), because those provisions do not apply to a party’s responses to motions.
A is correct. The state legislature’s retroactive law invalidated BigTech’s noncompete agreement, so the claim is no longer warranted by existing law. There is no wiggle room for a non-frivolous argument against the law, as there might be with precedent that is non-binding or that leaves room for interpretation. See Rule 11(b)(2). Because Rule 11 applies to “written motion[s] or other paper[s]” and to “later advocating” matters presented in the pleadings, it applies to BigTech’s continued pursuit of the noncompete claim in its summary judgment response. See Rule 11(b).
B is incorrect because nothing in the fact pattern suggests that BigTech lacks the evidence needed to sustain a noncompete claim; the problem is legal, not factual.
C is incorrect because the noncompete claim lacks legal support as explained above.
D is incorrect because Rule 11(b) explicitly applies to “other papers,” not just pleadings or motions.
Defendant, a technology company, hired Plaintiff, a technology specialist, as a part-time employee on an at-will basis. The employment contract provided that Defendant would reimburse Plaintiff for all “reasonable travel expenses in connection with work-related assignments.” After sending Plaintiff on an important assignment to Hong Kong, Defendant refused to reimburse her travel and hotel expenses, and then fired her without explanation. Two years later, Plaintiff filed a diversity action in federal court alleging breach of contract. Eight months after service of the summons and complaint and six months after service of the answer, Plaintiff was granted leave to amend the complaint to add a claim of tortious interference with contractual relations, alleging that Defendant’s actions prevented her from acquiring employment with other companies. Defendant moves to dismiss the amended claim as time-barred under the applicable state statute of limitations.
What is Defendant’s best argument in support of the motion to dismiss?
(A) The state relation-back rule does not permit relation back.
(B) The tort claim rests on a legal theory different from that of the original claim.
(C) The tort claim arises out of a different pattern of conduct than the original claim.
(D) Plaintiff engaged in undue delay in amending the complaint.
(C) is the best argument because it recognizes that an untimely amended claim will “relate back” to the date of the original pleading only if it is factually related to the original claim—so that it does not, in effect, present a new and independent action. The federal rule thus treats an amended claim as if it were filed on the date of the original pleading if it “asserts a claim or defense that arose out of the conduct, transaction, or occurrence set out … in the original pleading.” FRCP 15(c). Determining whether the amended and original claim are transactionally related often involves an inquiry into whether the claims share and are united by a “common core of operative facts.” Mayle v. Felix, 545 U.S. 644, 646 (2005). For example, relation back has been permitted when the original complaint alleged that a defendant union breached the duty of fair representation by inadequately representing plaintiff because of gender, and the amended claim alleged a gender discrimination claim under federal law, but was not permitted when the amended claim alleged retaliation. Maegdlin v. Int’l Ass’n of Machinists & Aerospace Works, 309 F.3d 1051, 1052 (8th Cir. 2002). Critical to this inquiry is whether the “opposing party is not unduly surprised or prejudiced.” Hill v. Shelander, 924 F.2d 1370, 1377 (7th Cir.1991); accord Schiavone v. Fortune, 477 U.S. 21 (“The linchpin [of Rule 15(c)] is notice …”). A pertinent question, therefore, is whether the breach-of-contract claim alleged in the original complaint—relating to unpaid reimbursable expenses—put Defendant on notice that it might be tortiously liable for Plaintiff’s inability to obtain subsequent employment. Arguably, the amended tort claim depends on “new and distinct conduct, transactions, or occurrences not found in the original complaint,” but the question is a close one. McGregor v. Louisiana State Univ. Bd. of Supervisors, 3 F.3d 850, 864 (5th Cir. 1993) (original claim alleging violation of the federal Rehabilitation Act did not put defendant on notice of amended claim alleging due process violation).
(A) is not correct because it misstates the relation between the federal rule on amendment and the state relation-back rule. The federal rule explicitly states that relation back will be permitted when “the law that provides the applicable statute of limitations allows relation back.” FRCP 15(c)(1)(A). However, the federal rule does not state the converse, and courts consistently hold that “less restrictive state relation-back rules will displace federal relation-back rules, but more restrictive state relation-back rules will not.” Morel v. Daimler Chrysler AG, 565 F.3d 20, 26 (1st Cir. 2009).
(B) is not correct because it misstates the standard for determining whether an amended claim is sufficiently related to the original claim as to permit relation back. Merely changing the legal theory upon which relief is sought is generally not a bar to relation back under FRCP 15(c). What is critical, by contrast, is the factual overlap of the amended claim and the original claim. As the Eighth Circuit Court of Appeals has explained, “a change in legal theory is not fatal to the rule’s application.” Maegdlin v. Int’l Ass’n of Machinists & Aerospace Works, 309 F.3d 1051, 1053 (8th Cir. 2002).
(D) is not correct because the rule that it states is irrelevant to the determination of relation back under FRCP 15(c). In some circumstances, a court may exercise discretion and deny leave to amend a pleading because the party unduly delayed without good cause in seeking to amend. However, delay is not a factor that affects whether the amended claim relates back to the original claim. See Arthur v. Maersk, Inc., 434 F.3d 196, 203 (3d Cir. 2006) (“There is no allowance in Rule 15(c) for inquiry into a party’s delay in moving for leave to amend.”).
Plaintiff, a citizen of Louisiana, filed an action in federal district court in New Orleans. His complaint contained a federal civil rights claim alleging that he had been the victim of unlawful sexual harassment and a breach of contract claim against his employer, also a citizen of Louisiana. The breach of contract claim alleged that the defendant-employer had failed to pay Plaintiff overtime as required by his employment contract. Plaintiff also asserted a tort claim for intentional infliction of emotional distress against his manager, a citizen of Louisiana, alleging that it was her intentional acts of sexual harassment that caused him to suffer severe emotional distress.
May the Plaintiff join the claim against his manager?
A) Yes, because his right of joinder is unlimited.
(B) No, because manager and Plaintiff are citizens of the same state.
(C) Yes, because his claim against the manager arises out of the same occurrences that gave rise to his claim against his employer and both claims contain a common question of fact.
(D) No, because the court does not have subject matter jurisdiction over this claim.
The correct answer is C. Plaintiff is seeking to bring claims against more than one defendant in this suit, which automatically makes this a joinder of parties problem, not a joinder of issues problem. The rule governing joinder of parties in federal court is FRCP 20. Under Rule 20(a)(2), a plaintiff can assert claims against more than one defendant as long as both of two requirements are met. First, these claims must arise out of the same transaction, occurrence, or series of transactions or occurrences. Second, the claims against both of the defendants must contain at least one common question of law or fact. Here, the claims against both Defendant and the manager arise out of the latter’s alleged acts of harassment. So the first requirement of Rule 20 is met. Second, both of these claims require resolution of, among other things, the factual question of what the manager did to Plaintiff. Consequently, both requirements of Rule 20(a)(2) have been met.
Answer A is incorrect. Unlike joinder of claims under Rule 18, joinder of parties under Rule 20 is not unlimited. Under Rule 20(a)(2), a plaintiff can assert claims against more than one defendant as long as both of two requirements are met. First, these claims must arise out of the same transaction, occurrence, or series of transactions or occurrences. Second, the claims against both of the defendants must contain at least one common question of law or fact.
Answers B and D are incorrect since the question raised in this problem is only joinability under Rule 20 and not whether the court has subject matter jurisdiction. Rule 20 is a rule of pleading and does not purport to eliminate or override the jurisdictional and venue requirements under the U.S. Code. Thus, when looking to joinability, Rule 20 allows a plaintiff to join multiple defendants to a single action, provided the requirements under the rule are met. Before the court can adjudicate that claim, however, the court will need to acquire the proper jurisdiction over the claims and the parties. This question deals only with joinability while Answers B and D deal with jurisdiction.
Plaintiff, a citizen of Louisiana, filed an action in federal district court in New Orleans. His complaint contained a federal civil rights claim alleging that he had been the victim of unlawful sexual harassment and a breach of contract claim against his employer, also a citizen of Louisiana. The breach of contract claim alleged that defendant-employer had failed to pay Plaintiff overtime as required by his employment contract. Plaintiff also asserted a tort claim for intentional infliction of emotional distress against his manager, a citizen of Louisiana, alleging that it was her intentional acts of sexual harassment that caused him to suffer severe emotional distress. In addition to filing an answer, defendant-employer asserted a breach of contract claim against Plaintiff and an indemnity claim against the manager. In its breach of contract claim, Defendant alleged that Plaintiff had not honored his contractual commitment to attend a variety of off-site conferences.
May the defendant-employer join its claim against the manager?
(A) No, because the claim does not arise under federal law.
(B) Yes, because its right of joinder is unlimited.
(C) No, because the parties are citizens of the same state.
(D) Yes, because this claim arises out of the transaction that gave rise to Plaintiff’s claim against Defendant.
The correct answer is D. Defendant has filed a cross-claim against the manager. The rule governing the joinder of cross-claims in federal court is FRCP 13(g). Like the rule regarding joinability of third-party claims, and unlike the rules governing the joinability of counterclaims, the rule governing joinability of cross-claims is limited. Rule 13(g) only permits the joinability of cross-claims that arise out of the transaction or occurrence that gave rise to the plaintiff’s claims or to a counterclaim. Defendant’s cross-claim against the manager for indemnity in connection with any liability it may incur as a result of Plaintiff’s claim against it clearly arises out of the occurrences that gave rise to the plaintiff’s claim against Defendant.
Answer B is incorrect because the rule governing joinability of cross-claims is limited. Defendant’s cross-claim against the manager for indemnity in connection with any liability it may incur as a result of Plaintiff’s claim against it clearly arises out of the occurrences that gave rise to the plaintiff’s claim against Defendant.
Answers A and C are incorrect. This problem only asked whether or not the claim was joinable and not whether the court had subject matter jurisdiction over the claim. Whether or not the court has subject matter jurisdiction is another matter, but that is not being tested in this question. Rule 13 is only a rule of pleading and does not purport to override or eliminate the jurisdictional and venue requirements under the U.S. Code. Thus, the question asks only whether the claim is joinable, not whether the court will ultimately be able to adjudicate the claim based on subject matter jurisdiction.
Plaintiff, a lifelong resident of Atlanta, Georgia, brought suit in federal district court in Atlanta against a publisher, Books, Inc., alleging copyright infringement under the federal copyright statute, for which she sought $100,000 in damages. Books, Inc. is incorporated under the laws of Delaware and has its principal place of business in New York City. Plaintiff also filed a claim against Books, Inc. alleging that it had breached its agreement with her to publish her book upon receipt of a manuscript. She sought $60,000 in damages in connection with that claim. In that same suit, Plaintiff also filed a $105,000 tort claim against the president of Books, Inc., a citizen of New York, alleging that he had intentionally inflicted emotional distress upon her by sending emails to dozens of other publishers denouncing her as a horrible writer and a fraud and explaining that those were the reasons for his company’s refusal to publish her book. In this same action, Books, Inc. filed a claim against President seeking indemnity for any liability it might accrue in connection with Plaintiff’s copyright infringement claim against it. In response, President filed a breach of contract claim against Books, Inc. alleging that Books, Inc. had improperly withheld two weeks of salary from him totaling $65,000. Finally, President asserted a tort claim against his neighbor, claiming that her negligent maintenance of her home significantly depreciated the value of his property, for which he sought an injunction and $45,000 in damages.
Is President’s claim against his neighbor joinable?
(A) Yes, because President was a named defendant.
(B) No, because these two parties are citizens of the same state.
(C) Yes, because it is a complaint for indemnity.
(D) No, because it is a tort claim alleging conduct that lowered the value of his property.
The correct answer is D. This is a third-party claim. Accordingly, joinability is determined by Rule 14(a), which only permits joinder of third-party claims for indemnity or contribution. Since this claim is not an indemnity or contribution claim, (but rather a claim alleging conduct that lowered the value of his property), it is not joinable.
Answer C is incorrect because this is not an indemnity claim, but rather an independent tort claim relating to the value of his property.
Answer A is incorrect because it is irrelevant to the joinability of the third-party complaint against the neighbor.
Answer B is incorrect because this issue goes to subject matter jurisdiction and not to joinability.
Plaintiff, a lifelong resident of Atlanta, Georgia, brought suit in federal district court in Atlanta against a publisher, Books, Inc., alleging copyright infringement under the federal copyright statute, for which she sought $100,000 in damages. Books, Inc. is incorporated under the laws of Delaware and has its principal place of business in New York City. Plaintiff also filed a claim against Books, Inc. alleging that it had breached its agreement with her to publish her book upon receipt of a manuscript. She sought $60,000 in damages in connection with that claim. In that same suit, Plaintiff also filed a $105,000 tort claim against the president of Books, Inc., a citizen of New York, alleging that he had intentionally inflicted emotional distress upon her by sending emails to dozens of other publishers denouncing her as a horrible writer and a fraud and explaining that those were the reasons for his company’s refusal to publish her book. In this same action, Books, Inc. filed a claim against President seeking indemnity for any liability it might accrue in connection with Plaintiff’s copyright infringement claim against it. In response, President filed a breach of contract claim against Books, Inc. alleging that Books, Inc. had improperly withheld two weeks of salary from him totaling $65,000.
Is President’s breach of contract claim against Books, Inc. joinable?
(A) Yes, because there is no limit to joinability of this type of claim.
(B) No, because it is unrelated to the events that gave rise to Books, Inc.’s claim against Jackson.
(C) Yes, because Books, Inc. was named in the complaint.
(D) No, because the parties are not diverse.
The correct answer is A. Although this is a claim between co-defendants, it is not a cross-claim, but a counterclaim to Books, Inc.’s cross-claim against President. Consequently, the correct Rule governing joinability is Rule 13(a) and (b) and not Rule 13(g). There is no limit on joinability of counterclaims and so this claim is joinable. Whether or not the court has subject matter jurisdiction is another matter, but that is not being tested in this question. Rule 13 is only a rule of pleading and does not purport to override or eliminate the jurisdictional and venue requirements under the U.S. Code. Thus, the question asks only whether the claim is joinable, not whether the court will ultimately be able to adjudicate the claim based on subject matter jurisdiction.
Since it is not a cross-claim, but rather it is a counterclaim to Books, Inc.’s cross-claim, there is no need to meet the Rule 13(g) requirement of transactional relatedness and so answer B is incorrect.
Answer C is incorrect because this fact is irrelevant to the joinability of the counterclaim.
Answer D is incorrect because the issue here is joinability, not subject matter jurisdiction. Whether or not the court has subject matter jurisdiction is another matter, but that is not being tested in this question. Rule 13 is only a rule of pleading and does not purport to override or eliminate the jurisdictional and venue requirements under the U.S. Code. Thus, the question asks only whether the claim is joinable, not whether the court will ultimately be able to adjudicate the claim based on subject matter jurisdiction.
Plaintiff, a citizen of State P, ate dinner one night at a restaurant operated in State P by Defendant, a citizen of State V. After eating dinner, Plaintiff became ill. It was determined that the produce at the restaurant was contaminated. Defendant had bought produce from a third party, a citizen of State P who is in the business of delivering produce to restaurants. This seller had bought the produce from a farmer who is a citizen of State V.
After months of hospitalization, Plaintiff commenced a $350,000 tort action in State P federal district court against Defendant. Defendant then impleaded the produce seller and the farmer as third-party defendants, under an indemnification theory. Plaintiff then sought to amend the complaint to add similar claims against the seller and farmer.
Seller moved to dismiss Plaintiff’s claim against him for lack of subject matter jurisdiction. Farmer moved to dismiss Defendant’s third-party claim against him on lack of subject matter jurisdiction.
How should the court rule on each motion?
(A) The court should grant seller’s motion but not grant farmer’s, because Plaintiff’s suit against seller does not fall within the court’s supplemental jurisdiction but Defendant’s suit against farmer does.
(B) The court should grant farmer’s motion but not grant seller’s, because Defendant’s suit against farmer does not fall within the court’s supplemental jurisdiction but Plaintiff’s suit against seller does.
(C) The court should not grant either motion, because both Plaintiff’s suit against seller and Defendant’s suit against farmer fall within the court’s supplemental jurisdiction.
(D) The court should grant both motions, because neither Plaintiff’s suit against seller nor Defendant’s suit against farmer falls within the court’s supplemental jurisdiction.
A is correct. Pursuant to FRCP 14, seller is a third-party defendant. A defending party is permitted to bring into the lawsuit a nonparty who is or may be liable to the defending party for all or part of the original plaintiff’s claim against the defending party. The additional party is called the third-party defendant and the defending party is called the third-party plaintiff. This impleader action does not need an independent basis for subject matter jurisdiction; so long as the original action satisfies the requirements, the courts will exercise supplemental jurisdiction over the third-party claims.
Since the claim by the original defendant against a third-party defendant falls within the court’s supplemental jurisdiction, Defendant’s third-party claim against the farmer will not be dismissed, even though the Defendant and the farmer are both from State V.
However, a claim by the original plaintiff against the third-party defendant does not fall within the court’s supplemental jurisdiction, so it must have independent basis for subject matter jurisdiction. Here, Plaintiff and seller are both citizens of State P, so there is no diversity of citizenship. Also, under the supplemental jurisdiction statute, the federal court cannot exercise supplemental jurisdiction over a plaintiff’s claims against persons made parties under Rule 14 when doing so would destroy diversity jurisdiction. The court must dismiss Plaintiff’s claim against seller.
B is incorrect because under the supplemental jurisdiction statute, the federal court cannot exercise supplemental jurisdiction over a plaintiff’s claims against persons made parties under Rule 14 when doing so would destroy diversity jurisdiction.
C is incorrect because, although Defendant’s claim against farmer falls within the court’s supplemental jurisdiction power and should not be dismissed, supplemental jurisdiction will not permit the court to assert jurisdiction over Plaintiff’s claim against seller when doing so destroys diversity, under the supplemental jurisdiction statute.
D is incorrect because, even though Defendant and farmer are citizens of the same state (thus there cannot be diversity jurisdiction), Defendant’s third-party claim against farmer properly falls under the court’s supplemental jurisdiction and should not be dismissed.
Plaintiff, employed by Defendant’s company, applies for a promotion and is denied; she believes that she was passed over because of her gender. Believing that the problem is widespread throughout the company, she files a class action lawsuit in federal court challenging Defendant’s hiring and promotion policies. The complaint alleges a violation of the federal employment statute, which bars “discrimination in the terms and conditions of employment on the basis of gender, ethnicity, religion, and race,” and defines the class as “persons not hired or not promoted by Defendant because of gender, ethnicity, religion, or race.” The action seeks damages for every member of the class. Defendant opposes the motion for class certification.
What is Defendant’s best argument in opposition to the motion?
(A) The class is alleged to include only 92 clerical and administrative workers and so numerosity is not present.
(B) Plaintiff is not a member of the class she purports to represent.
(C) The amount in controversy is not alleged to exceed $5 million.
(D) The court lacks personal jurisdiction over the absent class members because they live outside the state in which the federal court hearing the dispute is located.
(B) is the best answer because a basic condition of class certification is the membership of the named plaintiff in the class she purports to represent; the class claims must be “fairly encompassed by the named plaintiff’s claim.” This requirement goes to the heart of the class action: the procedure permits a party to represent the interests of similarly situated litigants, who are bound by any judgment entered in the lawsuit. To avoid unfairness to the absentees, the named representative must affirmatively show that all of the prerequisites of class certification are present—numerosity, commonality, typicality, and adequacy of representation, see FRCP 23(a)(1)-(4). Here, Plaintiff has defined the class to include persons allegedly not hired and persons allegedly not promoted by Defendant for reasons of gender, ethnicity, religion, or race that are discriminatory under federal law. However, Plaintiff cannot herself allege not to have been hired by Defendant; she does not share this claim with other members of the class and therefore cannot be presumed to be an adequate representative of the absentees on this issue. Nor does Plaintiff allege to have been discriminated on the basis of ethnicity, religion, or race. Similarly, she is not a member of the class of persons who allege discrimination on these bases. See General Tel. Co. v. Falcon, 457 U.S. 147, 157-158 (1982) (certification not appropriate when class representative alleged across-the-board discrimination in hiring and firing, but alleged only a failure to promote as an individual claim).
(A) is not correct because although class certification requires that “the class be so numerous that joinder of all member is impracticable,” FRCP 23(a)(1), there is no hard and fast rule on how large the class must be to meet this requirement. See Bittinger v. Tecumseh Prods. Co., 123 F.3d 877, 884 n.1 (6th Cir. 1997) (stating that the rule does not include a “strict numerical test”). Classes of 14 members have been found sufficient to meet the numerosity requirement, Grant v. Sullivan, 131 F.R.D. 436, 446 (M.D. Pa. 1990), although generally the class must include at least 40 members. Moreover, the court also must consider whether the joinder of all class members is practicable—if it is, at least some courts hold that “the other criteria don’t matter.” In reaching this determination courts consider not only the size of the class, but also additional factors, such as the reluctance of absent class members to sue for fear of retaliation and geographic dispersion of the class members. See Mullen v. Treasure Chest Casino, LLC, 186 F.3d 620, 624 (5th Cir. 1999). On the facts here, it is not clear that Defendant’s argument would win under FRCP (a)(1).
(C) is not correct because it states a rule that is irrelevant to the analysis of class certification. Class actions, like all actions filed in federal court, must satisfy subject-matter jurisdiction requirements. When the lawsuit is filed under the Class Action Fairness Act (CAFA), the amount in controversy must be alleged to exceed $5 million exclusive of interest and costs, and this sum can be met by aggregating together all of the claims of the class members. See 28 U.S.C. §1332(d)(6). When CAFA does not apply to the class suit, and the allegations involve state law, then the amount in controversy must be alleged to exceed $75,000 for each class member, and subject-matter jurisdiction can be satisfied if the requirements of the diversity and supplemental jurisdiction statutes are met. See 28 U.S.C. §1332 (diversity), §1367 (supplemental); Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546 (2005). But these jurisdictional bases are not relevant to the certification analysis under FRCP 23. Here, the complaint alleges a violation of federal law, and in federal question suits jurisdiction does not require the showing of any amount in controversy. See 28 U.S.C. §1331.
(D) is not correct because the rule that it applies is not correct. In a class action, the court must be able to exercise personal jurisdiction over defendant; however, there is no requirement that the court determine whether it could exercise personal jurisdiction over the class members. See Phillips Petroleum Co. v. Shutts, 472 U.S. 797 (1985). Thus, even if the class members have no connection to the state in which the district court sits, they nevertheless will be bound by any judgment that might be entered in the suit (unless they opt out). The Supreme Court of the United States has not yet resolved whether the Due Process Clause is violated by the entry of a judgment against members of a class who lack contacts with the state and are not permitted an opportunity to opt out of the class suit.
An automotive engineer employed by Ford Motor Company designed the accelerator system for the Ford Focus car. Defects in the Ford Focus accelerator system are now at issue in a federal court class action lawsuit filed by consumers harmed in accidents where the accelerator malfunctioned. May the consumers take the engineer’s deposition?
(A) No, because the engineer’s testimony qualifies as trial preparation material.
(B) No, because the engineer is a consulting expert hired in anticipation of litigation.
(C) Yes, because the engineer is a witness with both expertise and personal knowledge of the facts relevant to the lawsuit.
(D) Yes, because the engineer is a testifying expert who must prepare an expert report and be available to be deposed about the findings in that report.
C is correct. The engineer may be deposed because the engineer’s testimony will consist of personal knowledge and expert opinion acquired as the accelerator designer during the design phase—not after the fact as a testifying or consulting expert. See Rule 26(b)(4)(A) and Rule 26(b)(4)(D).
A is incorrect because oral witness testimony can never be trial preparation material. Rule 26(b)(3)(A)’s trial preparation material provision applies only to “documents and tangible things.”
B is incorrect because the engineer was not “retained or specially employed in anticipation of litigation”; rather, the engineer was a Ford employee all along. See Rule 26(b)(4)(D).
D is incorrect because the engineer was not “retained or specially employed to provide expert testimony in the case,” nor is the engineer “one whose duties as the party’s employee regularly involve giving expert testimony.” As a result, under Rule 26(a)(2)(B) and (C), the engineer does not need to provide an expert report, only a written summary of what the engineer knows and opines from having designed the accelerator.
Company is the manufacturer of off-road recreational vehicles. Driver owns a vehicle manufactured by Company. Driver was injured while driving the vehicle on the highway. Driver claims that the vehicle accelerated when it was supposed to brake, and as a result it rolled into a ditch. A State Trooper was called and arrived at the scene of the accident. Plaintiff has informed Company that he intends to file a federal action, based on diversity jurisdiction, for injuries caused by the car’s alleged product-design defects. Company wants to find out what the State Trooper knows about the accident and whether Driver behaved in any erratic or unusual way, and has filed a verified petition with the federal district court in the district in which the accident occurred to depose the State Trooper.
Does the Company have a right to depose the State Trooper?
(A) No, a party may not take discovery from a nonparty before the commencement of a federal lawsuit.
(B) No, a party may take discovery before a suit is commenced but only if the request is accompanied by a draft complaint against the party from whom discovery is sought.
(C) Yes, a party may take discovery of material that is relevant to claims and defenses.
(D) No, a party may not take discovery before the commencement of a federal lawsuit absent a special need to preserve testimony that is not present on these facts
(D) is the correct answer. The federal discovery rules allow a party to petition a district court for an order to perpetuate testimony before a lawsuit has commenced. See FRCP 27. A party seeking pre-complaint discovery must file a verified petition with the district court which shows: “(A) that the petitioner expects to be a party to an action cognizable in a United States court, but cannot presently bring it or cause it to be brought; (B) the subject matter of the expected action and the petitioner’s interest; (C) the facts that the petitioner wants to establish by the proposed testimony and the reasons to perpetuate it; (D) the names or a description of the persons whom the petitioner expects to be adverse parties and their addresses, so far as known; and (E) the name, address, and expected substance of the testimony of each deponent.” FRCP 27(a)(1). Pre-complaint testimony “cannot be used to discover evidence for the purpose of filing the complaint.” In re Allegretti, 229 F.R.D. 93, 96 (S.D.N.Y. 2005). The consensus reading of FRCP 27 is that the rule “should be used ‘in special circumstances to preserve testimony which could otherwise be lost.’” In Re Yamaha Corp., U.S.A., 251 F.R.D. 97, 99 (2008) (quoting Ash v. Cort, 512 F.2d 909 (3d Cir. 1975)). The facts here indicate that Company would be unable to show that State Trooper’s testimony would be lost, concealed, or destroyed, and thus there is no justification to grant the motion for the pre-complaint deposition. Moreover, Company cannot specify “facts that [it] wants to establish by the proposed testimony”; it simply wishes to learn more about the accident. Further, Company has no “reason to perpetuate [the testimony].” Company does not allege that State Trooper is ill or planning soon to leave the country, or that he plans to destroy or conceal evidence. See id. at 96. There is no reason to believe that State Trooper will not be able to give any testimony if Driver does file a federal action against Company. Be aware that in a few states, pre-litigation discovery is more generous than under the federal discovery rules. See, e.g., Ohio Civ. R. 34(D)(1) (pre-filing discovery permitted by “a person who claims to have a potential cause of action”).
(A) is not correct because it mistakenly applies an incorrect rule. As discussed in the explanation for Choice (D) above, the Federal Rules of Civil Procedure explicitly allow for limited discovery before commencement of a suit, as long as the party seeking discovery can show that it expects a suit to be brought, but temporarily cannot and the testimony it seeks is at risk of being lost or destroyed. See FRCP 27. Pre-litigation discovery is so limited in order to avoid exploitation of the judicial system by, for example, firms seeking information from their competitors, with no intention of pursuing litigation. See Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241, 270 (2004). Thus, though Company’s request should be denied, it is not for this reason, but rather the reason given in Answer (D).
(B) is not correct because it misstates the requirements of the relevant federal rule. A party seeking pre-complaint discovery must file a verified petition with the district court as explained in Answer (A). Though pre-complaint testimony “cannot be used to discover evidence for the purpose of filing the complaint,” In re Allegretti, 229 F.R.D. 93, 96 (S.D.N.Y. 2005), the federal rule does not require that a complaint be drafted, only that the petitioner expects to be a party in a lawsuit. Thus, though Company’s request should be denied, it is not for this reason, but rather the reason given in Answer (D).
(C) is not correct because the rule that it recites, although true as far as it goes, does not control the result on these facts. The federal discovery rules define what is discoverable, who may discover information, and when information may (or must) be discovered. Even if the deposition of the State Trooper will lead to information that is relevant to the claims and defenses in an anticipated law suit, see FRCP 26(b), the rules seriously curtail any discovery prior to the commencement of a litigation. Importantly, pre-litigation discovery “cannot be used to discover evidence” for use in the pleadings. See In re Allegretti, 229 F.R.D. 93, 96 (S.D.N.Y. 2005). While the pre-complaint deposition of State Trooper might generate information relevant to Company’s defenses, this is not an acceptable reason to grant a petition for pre-litigation discovery under FRCP 27.
Plaintiff, an individual who lives and works in California, was visiting New York. He decided to take a taxi to go across town. While driving on Sixth Avenue, Taxi Driver collided with Defendant’s truck. Defendant is an individual who lives and works in New Jersey and is employed by a trucking company that is incorporated and headquartered in New Jersey. Taxi Driver lives and works in New York. Plaintiff was seriously injured and eventually sued Taxi Driver, Defendant, and Defendant’s employer in federal district court on the basis of diversity jurisdiction.
Will Plaintiff be able to discover the existence of the three defendants’ insurance coverage?
(A) No, because the existence and extent of the defendants’ insurance coverage is not relevant to the trial on the merits.
(B) No, because discovery of the insurance coverage could lead to an inflated verdict and would therefore be unfair to the defendants.
(C) Yes, but only the existence of the insurance coverage and not the monetary limits of the policy.
(D) Yes, because the facts of insurance coverage must be disclosed even without a discovery request.
(D) is the correct answer because the federal discovery rules make the disclosure of insurance agreements a subject of mandatory initial disclosure without a discovery request. Under the rule, every party must provide “for inspection and copying … any insurance agreement under which an insurance business may be liable to satisfy all or part of a possible judgment in the action or to indemnify or reimburse for payments made to satisfy the judgment.” FRCP 26(a)(1)(A)(iv). As with other mandatory initial disclosures, insurance information must be provided without a discovery request at or within 14 days after the required discovery meeting, see FRCP 26(f), unless otherwise ordered by the court or the parties stipulated to a different time. Keep in mind that the federal rules did not always explicitly authorize the disclosure of insurance information from an opposing party. In 1970 the federal rules were amended to allow discovery of the existence and substance of insurance agreements (in what was then numbered FRCP 26(b)(2)). In 1993 the federal rules again were amended, and now insurance agreements were made a topic of required disclosure; a party’s failure to disclose insurance as mandated is, like other discovery violations, subject to sanction. See Wickens v. Shell Oil Co., 620 F.3d 747, 759 (7th Cir. 2010) (finding that a party “evaded” its responsibilities to disclose an “insurance company funding the litigation,” and stating that “[t]he choice of a proper sanction for violations of the discovery rules … lies in the discretion of the district court”).
(A) is not correct because it misstates the rule of relevance and the current position taken by the federal rules on whether information about a party’s insurance coverage is relevant. Whether information sought to be discovered is relevant within the meaning of the federal rules is determined with respect to the claims and defenses in the action. See FRCP 26(b)(1) (“Parties may obtain discovery regarding any non-privileged matter that is relevant to any party’s claim or defense … .”). Therefore, the statement in Choice (A) that insurance coverage is not “relevant to the trial on the merits” is not an accurate description of the governing rule. Moreover, as explained with respect to Choice (D), the federal rules now make the disclosure of insurance agreements a matter of required disclosure. See FRCP 26(a).
(B) is not correct because the view that it expresses, while shared by some courts and commentators, is not the view reflected in the current federal rules. See FRCP 26(a). The 1970 amendment to the federal rules, permitting the discovery of insurance agreements, was intended to “enable counsel for both sides to make the same realistic appraisal of the case, so that settlement and litigation strategy are based on knowledge and not speculation”; at least in some cases, it was assumed that knowledge about insurance coverage would promote settlement and avoid “protracted litigation.” Proposed Amendments to the Federal Rules of Civil Procedure Relating to Discovery, 48 F.R.D. 487, 499 (1969). However, keep in mind that apart from the disclosure of insurance agreements, the federal courts generally do not permit discovery of a defendant’s financial condition. Although plaintiff may wish to know if defendant will be able to satisfy a judgment, the trend of decision is that such information is not relevant and therefore is not subject to discovery. See Sierrapine v. Refiner Prods. Mfg., Inc., 275 F.R.D. 604 (E.D. Cal. 2011). Rather, the appropriate way to obtain such information is post-judgment. See FRCP 69(a)(2).
(C) is not correct because the rule that it states is not correct. The federal discovery rules mandate the production of information about the existence of insurance coverage as well as the monetary limits of the policy. See FRCP 26(a)(1)(A)(iv). However, it is recognized that the insurance application “may contain personal and financial information concerning the insured,” and discovery of that information is beyond the scope of discovery of insurance agreements. See Proposed Amendments to the Federal Rules of Civil Procedure Relating to Discovery, 48 F.R.D. 487, 499 (1969). What is required, is the production “of any insurance policies that give rise to an insurer’s obligation to indemnify or hold its insured harmless for a judgment,” and generally does “not require the production of all agreements relating to insurance.” Excelsior College v. Frye, 233 F.R.D. 583, 585 (S.D. Cal. 2006).
Toyco, a toy manufacturing company, sued one of its former employees in federal court under federal and state laws for designing and marketing a competing toy while she was still employed at Toyco. In discovery, Toyco asked the former employee to produce hard drives from any personal laptop computer she used for design purposes while working at Toyco. The former employee responded that no such hard drives existed. Later, in her deposition, the former employee testified that she had a personal laptop while she worked at Toyco but used it only for gaming, never for designing. She testified that she had cleaned the hard drive and disposed of the laptop one year after she stopped working for Toyco because she was seeking treatment for a gaming addiction—even though by then Toyco’s lawyer had threatened to sue her. Other discovery evidence corroborated that the former employee’s competing designs were composed on a work-issued computer. What sanctions, if any, should the court impose for the former employee’s failure to preserve her personal laptop’s hard drive?
(A) The court should not impose sanctions, because the loss of the laptop and its hard drive did not prejudice Toyco.
(B) The court should give the jury an adverse inference instruction against the former employee.
(C) The court should enter a default judgment against the former employee.
(D) The court should impose sanctions, because the former employee anticipated litigation at the time she disposed of the laptop.
A is correct. Because a laptop hard drive contains electronically stored information, Rule 37(e) applies. Under Rule 37(e)(1), sanctions for non-intentional deprivation of evidence may be imposed only on a finding of prejudice to the opposing party. Nothing in the question suggests that the former employee disposed of the laptop to intentionally deprive Toyco of evidence. As to prejudice, the loss of a hard drive that would reveal gaming habits but not competing designs will not prejudice Toyco’s unfair competition claim. First, a laptop used only for gaming and not designing is not even responsive to Toyco’s discovery request for “any personal laptop computer used for design purposes.” Second, in any event, Toyco has evidence of the employee’s competing designs from another source.
B is incorrect. The adverse inference sanction applies only to “acting with intent to deprive another party of the information’s use in litigation.” Rule 37(e)(2). As explained above, the facts don’t support this intent.
C is incorrect for the same reason. Under Rule 37(e)(2)(C), default is not an appropriate sanction for non-intentional destruction of electronically stored information.
D is incorrect. Even though the threat of a lawsuit by Toyco’s lawyer would suggest litigation is coming, it is much less clear that a laptop used for gaming “should have been preserved in the anticipation or conduct of” this litigation—a threatened dispute over the employee’s competing designs. Moreover, anticipating litigation is not the only requirement that the rule imposes for sanctions; it also requires prejudice. See Rule 37(e)(1).
