Midterm (1-6) Flashcards
Constitutional Limits in Litigation
Constitution Art. III § 2 = Sets limits of federal judicial authority. Fed courts cannot exceed these boundaries (SMJ).
Constitution Art. IV § 1 = Full Faith & Credit Clause = Requires that full faith and credit be given in each state to the judicial proceedings of every other state (UNITED states).
Fourteenth Amendment § 1 = Due Process Clause = No state shall deprive any person of life, liberty, or property without due process of law. = A court cannot exercise power over a person unless the state of that court has some connection to that person or the incident.
What is personal jurisdiction?
PJ concerns about state’s ability to assert power over a defendant.
Only cares about D because P, by bringing suit, consented to jurisdiction of that court.
Pennoyer v. Neff - Key Holding
PRESENCE is required for personal jurisdiction
§ Authority of tribunal is restricted by territorial limits of the state. Every state possession exclusive jurisdiction and sovereignty over persons and property within its territory.
§ No state can exercise direct jurisdiction over persons or property outside its territory.
□ Reason?
® Due Process Clause (14th amendment) restricts power of state governments and would be violated if a court without personal jurisdiction was about to hear a case against you.
® Full Faith and Credit Clause (Art. IV §1 US Const.) tells us that the courts of State A do not need to enforce a judgment against a defendant entered by the courts of State B if State B lacked personal jurisdiction over the defendant.
Limitations of Pennoyer:
You don’t have to be / live in a state to cause damage to the state
□ Ex: Prof. Kim chucking trash from NH to VT (with no property in NH); oil spills effecting multiple states; internet.
What about companies?
International Shoe Co. v. Washington - Key Holding
“But now due process requires only that in order to subject a defendant to a judgment in personam, if he is not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.”
§ PJ changed from being based on presence (D or D’s property) under Pennoyer to fairness under International Shoe Co.
Shaffer tells us that this standard applies to any defendant (corporation or person)
What if you sue out of state person and win… how can you collect? Can you?
Take the judgment to that state and they are bound to enforce it (McGee v. Int’l Life Ins. Co.).
Why?
Full Faith and Credit Clause (Art IV § 1).
Makes our states UNITED. Without it, people could just flee to other states.
McGee tells use we can go to a foreign state to get enforcement for your state’s court’s judgment.
What are “certain minimum contacts”?
Hanson tells us that we need “some act by which the defendant purposefully avails itself on the privilege of conducting activates within the forum state, thus invoking the benefits and protections of its laws.”
McGee – advertised in sold to Cali. Reached out. (TX life insurance company refusing to pay Cali)
Hanson – bank never reached out to do anything themselves in FL. (one daughter cut out of will)
Foreseeability and certain minimum contacts
Foreseeability alone is not enough for PJ. Defendant must benefit from forum states law / purposefully avail itself.
World-Wide Volkswagen Corp. v. Woodson
Foreseeable car bought in NY would be in OK not enough for minimum contacts with OK
Why is it important that a company “purposefully avail” itself?
So that it has clear notice it is subject to suit there and can act to alleviate the risk of burdensome litigation via insurance, distributing expected cost, or severing connections.
Nicastro weird problem
No majority so no precedent… but if you targeted the entire US shouldn’t that make you liable in every state rather than none?
Piercing the corporate veil
Corporation is only technically a sperarate person, really is the alter ego of same company. RARE – used to get around how difficult it is to hold a corporation liable for something another corporation did.
Do the “certain minimum contacts” have to cause/give rise to the plaintiff’s claim?
The requirement of certain minimum contacts establishes no “causation” requirement. It is not necessary that the defendant’s forum conduct gave rise to the plaintiff’s claims. Rather, the Court’s precedents require only that the suit “arise out of or relate to the defendant’s contacts with the forum.”
Ford Motor Co. v. Montana Eighth Judicial District Court
Ford’s substantial presence in the states (advertising, selling, and servicing those two car models, even if not the two specific vehicles involved in this case) establishes minimum contacts, and it does not matter that those contacts did not cause the plaintiffs’ injuries.
Bristol-Myers Squibb Problem
How can the plaintiffs know where BMS made the drug? Or where the marketing strategy was made?
- Sue them to get discovery… (then it’ll get dismissed for lack of PJ and you have to sue again).
What is general jurisdiction?
A state in which any suit may be brought against a defendant for any claim (Shoe tells us all US defendants have at least one state that has GJ over them).
What state has general jurisdiction over an individual?
The state of their domicile (residence).
General jurisdiction over corporations (development and current)
Goodyear (2011)
GJ requires “continuous and systematic” business contacts that make the corporation “essentially at home” in a state. (BAD LAW since Daimler)
Guideline. Pros = flexible. Cons = too flexible that no one knows that it means.
Daimler AG (2014) (good law)
“essentially at home” for a corporation means either
1. State of incorporation, or
2. State with headquarters (“principal place of business Bright line rule. Predictable. Downside = extremely rigid.
What is transient jurisdiction?
Jurisdiction over a nonresident, who was personally served with process while temporarily in that State, in a suit unrelated to his activities in the state. (Still works – see Burnham v. Superior Court).
“Tag” jurisdiction
Burnham v. Superior Court Weird fact = no majority. Only thing people agree on is that transient jurisdiction still works.
Advantages and disadvantages to consenting to PJ
Advantages = avoid cost and time fighting in court about where you can sue (see Bristol-Myers Squibb 5 years)
Disadvantages:
Plaintiff = more options give tactical advantage (e.g. friendly jury)
Defendant = harder to sue. San drag out suit so long P gives up without getting to merits.
Additional = risk of forum selection and choice of law clauses to be used to “ambush”
E.g. Kim’s K from DC that required suit to be brought in France and use Polish law.
Forum selection clauses & choice of law clauses
Forum Selection Clause = Determines which state a defendant can be sued in (has PJ).
Choice of law clause = Determines which state’s law applies to litigation, regardless of which state the defendant is sued in.
Can a forum selection clause determine PJ?
Carnival Cruise Lines v. Shute
Issue: Can a forum selection clause determine PJ?
Held: Yes, forum selection clauses can determine PJ as long as it is “fundamentally fair.”
Dissent: Plaintiffs were never notified of the FSC. Perspectives of notice can change the issue from “should the law let parties contract their PJ?” to “are some people using FSC to ambush unsuspecting parties?”