LA BAR EXAM NON-CODE TOPIC 4 FEDERAL JURISDICTION AND PROCEDURE Flashcards
For SMJ purposes, how is state citizenship of a non-corporate entity determined?
For SMJ purposes, state citizenship of a non-corporate entity is that of its member-owner(s). For example, if it has two member owners, domiciled in States A and B respectively, the LLC will have citizenship of States A & B.
Be on the lookout for a member owner of the LLC to be a corporate entity. In such a case, apply the Hertz test (for principal place of business) as well as the 1332(c) state of incorporation standard.
For SMJ purposes, does a temporary move affect state citizenship?
In order to acquire a new domicile and citizenship, one must be physically present in another state and he must have formulated the intent to remain there indefinitely. Otherwise, one will retain his old state citizenship even though he has left that state.
What is the 1332 amount-in-controversy requirement?
More than $75,000.
For SMJ purposes, how is state citizenship of a corporate entity determined?
Under 1332(c), a corporation’s state citizenship is that state of its incorporation, and the state of its principal place of business. A corporation’s principal place of business is determined by its nerve center (Hertz). The Hertz case defines the “nerve center” state as the one in which a corporation’s “high level officers direct, control, and coordinate the corporation’s activities,” which in practice “should normally be the place where the corporation maintains its headquarters.”
How is a defendant’s compulsory counterclaim against a plaintiff valid and permissible? When should it be asserted?
To be a valid compulsory counterclaim, the claim must be valid under the FRCP and the court must have valid SMJ. If diversity or federal question jurisdiction to not suffice, federal courts have another means of hearing an additional claim. In such a case, a court can have supplemental jurisdiction via 1367 if the claim is so related to form part of the same case or controversy.
Under the Rules (FRCP), FR 13(a) a compulsory counterclaim can be asserted that “arises of the transaction or occurrence that is the subject matter” of the plaintiff’s original claim. The two claims must share a common nucleus of operative fact - a standard synonymous to 1367.
The counterclaim should be asserted in the Answer.
What if a plaintiff or a defendant moves states after the complaint is filed?
Under $1332 precedents, this post-filing event can have no effect on the complete diversity of citizenship that existed on the date when the Complaint was filed. The federal court should reject any argument that dismissal is required because the parties are “now non-diverse.” The complete diversity that existed on the date when Plaintiff filed her Complaint will be treated by the court as valid for the duration of the litigation.
Can counsel request a document, prepared in anticipation of trial, be produced during discovery?
NO. According to Rule 26(c)(3), a party may not discover documents prepared in anticipation of litigation or for trial, either “by or for” the opposing party, an opposing party’s representative, or an opposing party’s attorney.
Can counsel request business records be produced during discovery?
Under Rule 34, the requested documents must be produced, assuming that they are discoverable under Rule 26, if they are relevant and non-privileged documents that are proportional to the needs of the case. They must be described with reasonable particularity in the request, and contain information that is reasonably calculated to lead to the discovery of admissible evidence.
What does a federal court do to determine which state law to apply to interpret a state-law issue in a diversity case?
According to Erie and the Federal Rules of Decision Act, $1651, when interpreting state-law issues in a diversity case, a federal court must apply the same “substantive” state law that would be used by the state supreme court in the state in which the federal court is located. Under Klaxon, state conflict-of-laws rules are “substantive” rules that must be applied under Erie in a diversity case. Therefore, a Louisiana federal court must apply the Louisiana conflict-of-laws provisions, which are found in the Louisiana Civil Code. The Code’s rule typically provided in the fact pattern may recommended applying a different state’s law.
What if the federal court learns of an insufficient amount-in-controversy once a case has begun under diversity jurisdiction?
As soon as the federal judge learns of the SMJ defect caused by the insufficient amount-in-controversy, the court must dismiss the suit sua sponte for lack of SMJ. Parties cannot attempt to confer SMJ by agreeing not to object to a defect in SMJ.
What are the six steps a defendant must take to remove a case to federal court?
First, as required under 1446(b)(3), Defendant should file a Notice of Removal within 30 days of the date when Plaintiff’s suit first became removal. Be on the lookout for amended pleadings, motions, orders, or “other paper” like an email, which determine the date the suit first became removable.
Second, under 1446(a), Defendant must provide a short and plain statement in the Notice concerning the jurisdictional grounds for removal.
Third, under 1446(a), Defendant must sign the Notice pursuant to FRCP Rule 11, and must attach a copy of all state court process, pleadings, and orders to the Notice.
Fourth, under 1441(a), Defendant must file the Notice and attached documents in the federal district court in the location that encompasses the location of the state court in which Plaintiff filed his suit.
Fifth, Defendant must serve Plaintiff with a copy of the Notice and attached documents along with a memo explaining the reasons why the suit was removed.
Sixth, Defendant must promptly file a copy of the Notice, the attached documents, and the memo, with the state court. This filing will effect the removal of the suit to the federal court.
What are the two bases for a plaintiff to remand a suit back to state court?
A defect in the removal procedure or a defect in SMJ. The remedy of remand on the ground of a removal procedure defect is available only if Plaintiff files a timely motion within 30 days of the date the Notice to Remove was filed. Otherwise, the Plaintiff waives the right to this remedy. By contrast, the remedy of remand on the basis of a defect in SMJ is available anytime during the course of the litigation, and the SMJ defect cannot be waived by the parties.
To prove a defect in removal procedure, what does a Plaintiff typically argue to remand the suit back to state court?
Plaintiff’s attorney could argue the removal was untimely. The one-year limitation on the removal of 1332 diversity cases does not apply to 1331 FQ cases.
Plaintiff’s attorney could argue the removal had a defect because the defendant was a forum-state-citizen. The 1441(b) prohibition on the removal of suits with a forum-state-citizen defendant applies only to 1332 diversity cases, not to the removal of suits based on 1331 FQ SMJ.
Suppose the plaintiff has attempted remand on the basis of a lack of SMJ because a new defendant has been joined which makes the parties non-diverse. What could the defendant who removed the suit attempt to argue to keep the suit in federal court?
Defendant could argue the fraudulent joinder doctrine is applicable. To persuade the federal court to disregard the SMJ defect created by the presence of the non-diverse defendant, Defendant 1 must show that Plaintiff has no reasonable basis for the recovery against non-diverse D2. Plaintiff must affirmatively produce evidence of the basis for a reasonable possibility of recovery against D2. If the court holds in favor of D1, the court infers that Plaintiff’s pupose for joining D2 was to defeat removal.
How could a defendant dismiss an action against Plaintiff before responsive pleadings are filed?
Defendant could file a timely pre-Answer Rule 12(b) Motion to Dismiss. For example, under 12(b)(6) for failure to state a claim upon which relief can be granted. In the alternative, Defendant may raise this Rule 12(b)6) defense in its Answer. To prove a 12(b)(6) motion, Defendant must show that the Plaintiff’s claim is not cognizable as a matter of law. Or, Defendant must show that Plaintiff’s factual allegations fail to satisfy the Twombly standard - that Plaintiff’s petition fails to allege sufficient facts to raise a claim that is “plausible” and “establishes an “entitlement to relief.”
