Joinder

Question 1

basic rules of joinder

Answer 1

(1) joinder must be allowed by the federal rules

(2) there must be SMJ over the case (every single claim in federal court must have SMJ)

Question 2

when is claim joinder by P ok?

Single P and multiple Ps

Answer 2

IN GENERAL: it is fine as long as there is SMJ over the claims

SINGLE P vs. SINGLE D: claim joinder is fine as long as there is SMJ over each claim [note that you can aggregate in diversity cases to reach amount in controversy requirement]

CLAIMS BY MULTIPLE Ps OR CLAIMS AGAINST MULTIPLE Ds: claims must
(1) arise out of the same transaction or occurrence
and
(2) raise at least one common question of law or fact

Question 3

who is a necessary party and how do you determine whether to join them? Go through the steps

Answer 3

(1) IS THE ABSENTEE NECESSARY?

Yes, if passes either of 3 Tests:

(a) without the absentee, the court cannot accord complete relief among existing parties [worried about multiple suits]

or

(b) [absentee has an interest in the action and] the absentee’s interest may be harmed if she is not joined [most likely to be used by courts]

or

(c) nonparty’s interest is not adequately protected by an existing party in the action

or

(d) party would be subject to inconsistent obligations

Note: joint tortfeasors are never necessary

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(2) IF ABSENTEE IS NECESSARY, CAN HE BE JOINED?

Joineder is feasible if:

(a) there is PJ over absentee

and

(b) there will be federal SMJ over the claim by or against the absentee.

In determining whether claim invokes diversity, the court “aligns” the absentee as P or D based on the absentee’s interest
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(3.1) IF ABSENTEE CAN BE JOINED, JOIN HIM

(3.2) IF ABSENTEE CANNOT BE JOINED, CAN THE ACTION PROCEED IN EQUITY AND GOOD CONSCIENCE WITHOUT ABSENTEE?

Court determines whether to proceed without absentee or dismiss the case based on:

(a) is there an alternative forum available [such as state court]?

(b) what is the actual likelihood of harm to the absentee?

and

(c) can the court shape relief to avoid that harm to the absentee?
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(4) IF ACTION IS DISMISSED, THE ABSENT PARTY IS DEEMED “INDISPENSABLE” [this is a motion to dismiss grounds under rule 12 - indispensable parties]

Question 4

what are the types of counterclaims and when may they be brought

Answer 4

(1) COMPULSORY COUNTERCLAIM

—arises out of the same transaction or occurrence as the P’s claim

– MUST be filed in the pending case or it is waived [unless she filed in another case]

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(2) PERMISSIVE COUNTERCLAIM

• does not arise from same transaction or occurrence as the P’s claim … can sue on the claim in a separate case

Question 5

what is a counterclaim

Answer 5

a claim against an opposing party

Question 6

where does a counterclaim go re: pleadings

Answer 6

usually goes in the D’s answer

Question 7

when must P respond to a D’s counterclaim [in the answer] ?

Answer 7

under R12, P must respond within 21 days of service on the counterclaim

Question 8

what are cross claims and when may they be asserted

Answer 8

• claim against a coparty
• must arise from the same transaction or occurrence as EITHER the underlying action OR or from a properly brought counterclaim
• cross claim is also proper if it relates to any property that is the subject matter of the original action.
• crossclaim may include a claim that the coparty is or may be liable to the crossclaimant for all or part of a claim asserted in the action against the crossclaimant.
• not compulsory

Question 9

Supplemental jurisdiction rules for cross-claims and interpleader [third party practice]

Answer 9

THIRD PARTY PRACTICE:
limitation on supplemental jurisdiction only applies to PS … NOT to third party defendants

cross claims?
normal rules

Question 10

what is an impleader/third-party claim and when/how must they be asserted?

after TPD is joined, what can happen?

Answer 10

WHAT IT IS
claim where a defending party (usually the D) is bringing in a new party. The defending party is now a third party plaintiff and new party is the third party defendant

WHEN ASSERTED
used to shift liability that the plaintiff is asserting the defendant owes to her, to the third party defendant [if D is found liable to P, TPD will have to indemnify him or pay contribution.

NATURE OF CLAIM
permissive

AFTER TPD IS JOINED:
– P may assert claims against him and he may assert claims agains her, which arise out of same T/O as underlying case

Question 11

process for filing impleader

Answer 11

(1) D must file a third party complaint naming the TPD
and
(2) D must have that complaint formally served on the TPD

Impleading must be done within 14 days of serving the answer, otherwise, need court’s permission

Question 12

definitions of indemnity and contribution

Answer 12

indemnity – shifts liability completely
Ex: TPD must cover full claim

contribution – shifts liability pro-rata
Ex: TPD must cover pro-rata portion of the claim

Question 13

Third party practice - diversity jurisdiction issues

A plaintiff, a citizen of Missouri, sues a defendant, a citizen of Kansas, in federal court for $100,000 invoking diversity SMJ. The defendant impleads a TPD, a citizen of Missouri, for indemnification of the full $100,000.

(1) Is there SMJ over the impleader claim?

(2) does it matter that the P and TPD are citizens of the same state?

(3) Would there be diversity SMJ if TPD (Missouri) asserted a transactionally related claim against Plaintiff (Missouri)?

(4) Let’s say the claim arises under state law, so there is no FQ. Is there supplemental jurisdiction?

(5) Would there be SMJ if Plaintiff (Missouri) asserted a claim against TPD (Missouri)? Supplemental jurisdiction?

Answer 13

(1) yes, there is diversity jurisdiction b/c TPD and D are different state citizens and it meets amount in controversy

(2) no - P not a party to that claim

(3) no independent SMJ - they are co-citizens so no diversity and not a FQ

(4) yes to supplemental because it is by a TPD and arises out of CNOF of the claim against TPD

(5) no - P cannot assert supp J in this case

Question 14

what is intervention

how to intervene

what types of intervention are there

what do you have to remember about SMJ here?

Answer 14

(1) WHAT IT IS

non party absentee intervenes to bring herself into the case as a P or D

Court may realign intervening party if it thinks absentee came in on wrong side
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HOW TO INTERVENE
Application to intervene must be “timely”
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TYPES OF INTERVENTION

(1) Intervention of right:
– if absentee’s interest may be harmed if not joined and if interest not adequately represented by the current parties
– if person passes the test for “necessary” party, they have right to intervene

(2) permissive intervention
– If the absentee’s claim or defense and the pending case have at least one common question of law or fact, intervention would be permissive and discretionary with court.
– Permissive intervention is usually allowed unless it would cause delay or prejudice to someone.
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SUBJECT MATTER JURISDICTION

a claim by an intervenor P is a claim by a P, so the limitation on supplemental J may apply

Question 15

what is interpleader and when does it apply?

what are the rules of interpleader

Answer 15

WHAT IT IS
An interpleader suit permits a person/stakeholder to require two or more adverse claimants to the stake to litigate among themselves to determine which, if any, has the valid claim to it.
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WHEN DOES IT APPLY
Interpleader applies if separate actions might result in double liability against a stakeholder
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RULES
(1) Rule 22 interpleader
Requires
(a) complete diversity between the stakeholder and all adverse claimants and in excess of $75,000
or
(b) a federal question claim
[normal service and venue rules apply]

(2) statutory interpleader section 1335
Requires only
(a) diversity between any two contending claimants
and
(b) $500 in issue
[service may be nationwide and venue is proper where any claimant resides]

Question 16

explain how to apply interpleader rules to situations where stakeholder makes no claim to the stake [i.e. is disinterested] and when they do:

Answer 16

CONCEPT OF INTERESTED/DISINTERESTED STAKEHOLDER:
So, normally, we would have a stakeholder who does not want to be sued by two people, and so interpleads the parties so that the court can decide how liability should be decided. Sometimes the stakeholder makes a claim to the issue at stake and sometimes it does not, it is purely disinterested.

EXAMPLE:
Insurance Company, a State A citizen, is unsure to which claimant it should pay $80,000 of life insurance proceeds, so it wants to file an interpleader action to have a court determine the issue. The company makes no claim to the insurance proceeds = DISINTERESTED All potential claimants to the life insurance policy are citizens of State B.
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APPLYING RULES FOR DISINTERESTED STAKEHOLDER

if the stakeholder is disinterested, and from state A and the claimants the stakeholder is bringing in are all from state B [like above]….
——–Rule 22 will apply, since there is complete diversity between stakeholder and the claimants
—— NO statutory interpleader because there must be diversity between any two “CONTENDING” claimants. Since the stakeholder is not contending, all contending parties are from the same state, so there is no diversity.
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APPLYING RULES FOR INTERESTED STAKEHOLDER

Same hypo, but stakeholder is interested, that is, the insurance company would be making a claim against the proceeds:
——- Rule 22 applies same as above
——- most courts hold that there is statutory interpleader available because the insurance company would be contending against a state B claimant

Question 17

what is a class action?

Answer 17

a case in which representatives sue on behalf of a group

Question 18

how to qualify for a class action?

Answer 18

NEED ALL 4 OF THE FOLLOWING:

(1) Numerosity = too many class members for practicable joinder [no magic #]

(2) commonality = there is some issue in common to all class members, so resolution of that issue will generate answers for everybody in one stroke

(3) typicality = the class rep’s claims are typical of the claims of the class

(4) representative adequate = rep will fairly and adequately represent the class

AND

MUST FALL INTO ONE OF THREE TYPES OF CLASS ACTIONS

(1) Prejudice/risk of inconsistent results
class treatment is necessary to avoid harm/prejudice either to class members or to the non-class party [RARE - common fund situation]

Ex: Many people have claims to a limited fund of money. If they sue individually, the fund will be depleted before all claimants get to court. That would leave those later claimants with nothing. To avoid this harm, a class action would allow everybody to recover at least a portion of their claim.

(2) Injunctive or declaratory relief appropriate
seeks injunction or declaratory relief because the D treated the class members alike. Ps usually cannot seek damages.

Ex: A class of employees claim that their employer is wrongfully re- fusing to provide them with vacation time as required by law. The group brings a class action seeking an injunction requiring the employer to provide vacation time.

(3) common question or damages
(a) common questions must predominate over individual questions
AND
(b) the class action is a superior method to handle question to alternate methods of adjudication [mass torts]

Ex: A bus crash injures 80 people. Obviously, there will be individual questions about damages, but the common questions, like whether the driver was negligent, may predominate. And the class action may be superior to 80 separate suits.

Question 19

requirements for bringing all types of class actions

Answer 19

(1) numerosity, commonality, typicality, adequate representative

(2) fits into the right type [(a) risk of inconsistent results, (b) injunctive or declaratory relief appropriate, (c) common questions predominate and class action is superior to other methods of adjudication]

(3) court certifies class by granting motion to certify

(4) court defines class and class claims, issues, or defenses

and

(5) court appoints a class counsel, who must fairly and adequately represent the interests of the class

Question 20

appeals for class actions

Answer 20

However the court rules on the certification motion, the losing party can seek review from the court of appeals. It’s discretionary with the court of appeals.

Question 21

requirements for type 3 class actions (common questions/damages)

Answer 21

(1) court must notify class members that they are in a class = individual notice (usually by mail) to all reasonably identifiable members

(2) notice is paid for by the class representative

(3) notice explains that class members:

(a) may opt out

(b) will be bound by the judgment if they do not opt out

and

(c) can enter a separate appearance through counsel

Question 22

explain right to opt out and binding effect of class action judgements on each type of case

Answer 22

Type 1 (prejudice) and type 2 (injunction/declaratory relief)
= no right to opt out and all members are bound by the judgement

Type 3 (common questions/damages)
= right to opt out but if do not opt out, will be bound by judgement

Question 23

explain how settlement of class action works

Answer 23

The parties can settle or dismiss a certified class action only with court approval.

And, in all three types, the court must give notice to the class members to get their feedback on whether the case should be settled or dismissed.

If it’s a Type 3 class, the court also might refuse to approve the settlement unless members are given a second chance to opt out.

Question 24

explain how SMJ in class actions works

Answer 24

If the class action asserts rights under federal law, FQ jurisdiction may be used.

For diversity cases, only the citizenship of the class rep is considered, and her claim must exceed $75,000 [claims of other ppl are ignored].

The claims of other class members are ignored. That means that as long as the class rep’s claim meets the requirements of diversity, the class action may use diversity.

Question 25

Class Action Fairness Act (CAFA)

Answer 25

CAFA grants SMJ separate from diversity of citizenship jurisdiction. It lets a federal court hear a class action if:

• There are at least 100 members;
• Any class member, not just the representative, is of diverse citizenship from any defendant;

and

• The aggregated claims of the class exceed $5 million.

Also, CAFA has an option for removal:
Any one defendant, even an in-state defendant, may remove the case from state to federal court.

All this makes it easier for interstate class actions to go to federal court.

local actions will stay local:

There are complicated provisions to ensure that local classes (where most class members and the primary defendants are citizens of the same state) do not stay in federal court; these cases get dismissed (or, if they were removed from state court, remanded to state court).

Question 26

if A sues B and then B motions for dismissal. Then, B sues A on the same case as was dismissed. is it barred?

Answer 26

No – B was never required to answer in the first case = he could not have asserted a compulsory counterclaim because it goes in your answer. So, B was not required to have asserted a compulsory counter claim in the first case and his action is not barred

Question 27

what does rule 18 say

Answer 27

A party asserting a claim, counterclaim, crossclaim, or third-party claim may join, as independent or alternative claims, as many claims as it has against an opposing party.

if D1 properly asserts one cross claim against D2, it can then assert any cross claim against D2 for any matter [as long as SMJ]