Missed MBE Questions Flashcards
VENUE: General Venue Rule
The plaintiff resides in a city in the Southern District of State C. The plaintiff credibly alleges that her federal legal rights were violated in a city in the Western District of State D by two defendants. The first defendant resides in a city in the Northern District of State C. The second defendant resides in a town in the Central District of State C, where the plaintiff’s employer is located. In which of the following districts would venue be proper as to all the parties?
Answer Choices:
A. The Western District of State D, the Northern District of State C, or the Southern District of State C.
B. The Western District of State D, the Central District of State C, or the Southern District of State C.
C. The Western District of State D, the Northern District of State C, or the Central District of State C.
D. The Western District of State D, the Northern District of State C, the Central District of State C, or the Southern District of State C.
Answer choice C is correct. Venue is proper in the district in which “a substantial part of the events” occurred that form the basis of the plaintiff’s claim. The Western District of State D meets this test. Venue is also proper in a district in which “any defendant resides, if all defendants reside in the same state in which the district is located.” Because the first defendant resides in the Northern District of State C, he can be sued there, and so can the second defendant because she also resides in State C, the state in which the Northern District of State C. Conversely, because the second defendant resides in the Central District of State C, she can be sued there, and so can the first defendant because he also resides in State C. However, neither Defendant resides in the Southern District of California, so venue is not proper in that district. That explains why Answers A, B and D are wrong. Additionally, answer choice A omits the Central District of State C, and answer choice B omits the Northern District of State C.
MULTIPLE PARTIES & CLAIMS: Class Actions
The State H federal district court chose a representative for a class of 67 patients who were allegedly injured by negligent medical care at a hospital in State H and collectively suffered damages of $3,000,000. After correctly asserting diversity jurisdiction, the court certified the class upon finding that the four basic requirements for a class action have been met and that prosecution of the claims through separate actions would impair the interests of other class members. The court posted on the courthouse bulletin board its certification order, which (1) described the action, the class, and the legal claims; and (2) informed class members that they may appear through an attorney and may request an exclusion, but otherwise are bound by the class judgment. Most members of the class never see this notice, including one patient who suffered especially severe damages as a result of the hospital’s negligence. After the class action trial is almost finished, the patient, who is unaware of the trial, filed a separate suit in the State H federal district court against the hospital. Should the court allow that suit?
A. Yes, because the contents of the notice did not meet the requirements of the federal class action rule.
B. Yes, because the patient never received appropriate notice of the class action.
C. No, because the Class Action Fairness Act prohibits such suits.
D. No, because the court properly certified the class and was not required to provide notice of the class action.
Answer choice D is correct. The court certified the class after applying the Rule 23(a) requirements (numerosity, common questions, typicality, and adequate representation) and then determining that the case fell within Rule 23(b)(1) as a “risk of prejudice” situation. Notice of a class action is not required in this situation, but only in a Rule 23(b)(3) situation. Thus, the court did not have to give any notice, even though it posted a notice in the bulletin board. Answer choice A is incorrect because the contents of this notice did contain all the essential elements required by Rule 23. Answer choice B is incorrect. It is true that the patient never received notice. It is also true that, if notice had been required, the form of notice (i.e., posting on the bulletin board) would have been inadequate. When notice is required for a class action, it must be the best notice that is practicable under the circumstances, including individual notice to all members who can be identified through reasonable effort. Nevertheless, because this was not a Rule 23(b)(3) situation, notice was not required. Answer C is incorrect because CAFA does not apply to this class action. For the CAFA to apply, the class must have at least 100 members and the class must have at least $5 million in total damages.
PERSONAL JUR: In General
An investor brought an action in federal district court for damages based on a violation of federal securities law. The defendant, a foreign corporation, received service of process by proper means in its country of incorporation. While the defendant’s contacts with the state in which the forum court sits do not satisfy the “minimum contacts” test, the defendant’s contacts with the entire United States satisfy this test. Of the following, which additional fact must the investor establish in order for the court to exercise personal jurisdiction over the defendant?
A. No state court could exercise jurisdiction over the foreign corporation.
B. The district court is located in the state in which the investor is domiciled.
C. The applicable federal securities law provides for nationwide service of process.
D. The court has personal jurisdiction over the defendant under the long-arm statute of the forum state.
Answer choice A is correct. Under Rule 4(k)(2), a federal court may exercise personal jurisdiction over a foreign defendant, even though the court would not otherwise have personal jurisdiction over the defendant due to the application of the “minimum contacts” test to the defendant’s contacts with the forum state. In order for this rule to apply, the plaintiff’s claims must be based on federal law. In addition, the exercise of personal jurisdiction over the defendant must be consistent with the United States Constitution and the laws of the United States. In other words, the defendant must have sufficient contacts with the United States as a whole to justify the exercise of personal jurisdiction over the defendant. In this case, the facts state that the investor’s claim is based on federal securities law. In addition, the defendant’s contacts with the entire United States satisfy the “minimum contacts” test. Thus, the exercise of personal jurisdiction over the defendant would be consistent with the laws of the United States and the Constitution. For the federal district court to exercise personal jurisdiction over the defendant, investor must additionally establish that no state court could exercise jurisdiction over the defendant. Answer choice B is incorrect because the domicile of the plaintiff is generally not relevant to the issue of the court’s personal jurisdiction over the defendant. Answer choice C is incorrect. Although service of process pursuant to a federal law that provides for nationwide service of process is a means by which a federal court can gain personal jurisdiction over a defendant, the facts indicate that the defendant in this action was served abroad, not within the United States. Answer choice D is incorrect. The primary means by which a federal court can exercise personal jurisdiction over an out-of-state defendant is by the long-arm statute of the state in which the court is located. However, even if that statute is applicable to this action, the court would lack personal jurisdiction over the defendant due to the lack of sufficient contacts with the forum state.
PLEADINGS: Service Of Process
On August 1, the plaintiff, a citizen of one state, sued the defendant, a citizen of another state, in the federal district court in the defendant’s home state. The plaintiff’s complaint credibly alleges that (1) the defendant breached a contract with the plaintiff that resulted in $150,000 in damages, and (2) the court has diversity jurisdiction. On November 15, the plaintiff served process on the defendant by sending the summons and complaint to the defendant’s residence via Overnight Express Mail, a form of service authorized by the law of the forum state. The defendant moves to dismiss the complaint based on insufficient service of process. Should the court grant this motion?
A. Yes, because the Federal Rules authorize service only on a defendant personally, on a person of suitable age and discretion at defendant’s usual abode, or on an agent authorized by a defendant or by law to receive service.
B. Yes, because the service of process was not timely.
C. No, because under the Erie doctrine, the federal court must apply state law.
D. No, because the Federal Rules allow service that follows state law governing courts in the state where the federal district court is located.
Answer choice D is correct. In diversity jurisdiction, federal courts follow federal procedural rules. Although FRCP4(e) sets forth the three methods of service described in answer choice A as permissible methods, service may also be effected by following state law in an action brought in courts in a state where the federal district court is located. Plaintiff’s mail service here is sufficient because it follows the forum state’s law. Answer A is incorrect because those three methods of service, while permitted, are not exclusive. Answer B is incorrect because service was timely, since it was made within 120 days of filing the complaint. Answer C is incorrect because the Erie doctrine does not require federal courts to apply state procedural law. Rather, the mail service here is sufficient because the Federal Rules allow service in accord with state procedural law.
PRETRIAL PROCEDURE & DISCOVERY: Discovery Scope And Limits
A consumer sued a lawn mower manufacturer in a federal district court sitting in diversity jurisdiction, alleging that the consumer suffered damages due to a defect in the manufacture of a lawn mower. Prior to commencing suit, the consumer consulted two experts, a design expert and a manufacturing expert, about the lawn mower that was the source of the consumer’s injuries. After filing the complaint, the consumer, in making his required disclosures, identified the manufacturing expert as an expert expected to be called at trial. The design expert is not expected to testify. The manufacturer sent an interrogatory to the consumer requesting the identity of any other experts consulted with regard to the case. Is the consumer required to identify the design expert in his answer to the interrogatory?
A. No, because the design expert is not expected to testify at trial.
B. No, because the information is protected by the work product doctrine.
C. Yes, because the manufacturer has specifically requested the identity of all experts consulted by the plaintiff.
D. Yes, because no privilege or other protection applies.
Answer choice A is correct. While experts who may testify at trial must be disclosed as part of the initial mandatory disclosure, experts employed in anticipation of litigation who are not expected to be called as a witness at trial need not be identified, absent exceptional circumstances under which it is impracticable for the party to obtain facts or opinions on the same subject by other means. Here, the manufacturer has not made such a showing. Accordingly, answer choice D is incorrect. Answer choice B is incorrect. The identity of a consulting expert would not be subject to the work product doctrine, which protects documents and tangible things that are prepared in anticipation of litigation. Answer choice C is incorrect. Experts who are not expected to be called as a witness at trial generally need not be identified in discovery, regardless of whether the manufacturer specifically requested the identity of all experts consulted through an interrogatory.
PERSONAL JUR: In Personam Jurisdiction
A plaintiff secured a default judgment for breach of contract against a defendant in a diversity action brought in federal district court in State X. The defendant, a natural person, was not domiciled in State X, but had sufficient contacts with the state to satisfy the minimum contacts test. The defendant was properly served with process but elected not to contest the action. The plaintiff has, pursuant to statute, registered the judgment with a federal district court located in State Y. The defendant has a bank account in State Y, but otherwise has no property or contacts with the state. The plaintiff has sought a court order permitting a levy against the defendant’s bank account to satisfy the judgment. The defendant has challenged this order on grounds that the federal district court in State Y lacks personal jurisdiction over the defendant. How should the court rule on the defendant’s challenge?
A. Uphold the challenge, because the defendant did not litigate the matter in the federal district court in State X.
B. Uphold the challenge, because the defendant lacks minimum contacts with State Y.
C. Deny the challenge, because of the Full Faith and Credit Clause in Article IV of the U.S. Constitution.
D. Deny the challenge, because the minimum contacts test does not apply.
Answer choice D is correct. Satisfaction of the minimum contacts test is generally required for a court to have personal jurisdiction over a defendant. However, once a court with personal jurisdiction over a defendant renders a judgment, that judgment is enforceable by a court in another state by seizure of the defendant’s property located in that state, even if the defendant does not have minimum contacts with the state. Here, the federal district court in State X had personal jurisdiction over the defendant because the defendant had sufficient contacts with State X to satisfy the minimum contacts test and the defendant was properly served with notice of the action. Therefore, the State X federal district court’s judgment against the defendant can be enforced by the federal district court in State Y by levy against the defendant’s bank account in State Y. Accordingly, answer choice B is incorrect. Answer choice A is incorrect. While a defendant may collaterally attack a default judgment rendered in one state for lack of personal jurisdiction when the plaintiff seeks to enforce the judgment in another state, such an attack is not permitted if the defendant had notice of the action and the opportunity to defend against such action, but elected not to do so. In this case, the defendant’s election to not contest the action in State X constituted a waiver of any jurisdictional issues. Answer choice C is incorrect because the Full Faith and Credit Clause applies to the enforcement of a state-court judgment by the courts of another state. Here, the federal district court in State Y is providing relief in the form of a levy on the defendant’s bank account to enforce a judgment granted by the federal district court in State X.
PLEADINGS: Amendments And Supplemental Pleadings
On August 1, the plaintiff properly filed a complaint in federal court against the defendant for violating federal water pollution laws in a way that damaged the plaintiff’s waterfront property. The defendant did not waive service of process. On August 7, the plaintiff properly served the defendant with the summons and complaint. On August 16, the plaintiff amended her complaint to add a claim under state nuisance law and, that same day, properly served the amended complaint on the defendant. When is the latest date that the defendant can submit his answer?
A. 21 days after the complaint was filed (August 22).
B. 21 days after the complaint and summons were served (August 28).
C. 14 days after the amended complaint was served (August 30).
D. 21 days after the amended complaint was served (September 6).
Answer choice C is correct. Under Rule 15(a)(3), the defendant must respond to the amended complaint within 14 days after its service on August 16 (i.e., August 30) since this date is later than the time remaining for response to the original complaint (i.e., August 28, which is 21 days after it was served). Answer choice A is incorrect because the 21-day clock starts ticking when the complaint is served, not when it is filed. Answer choice B would have been correct if the plaintiff had not amended her complaint, but she did, which extended the defendant’s time to answer. Answer choice D erroneously states the time period to respond to an amended complaint as 21 rather than 14 days.
SUBJECT MATTER JUR: Diversity Jurisdiction
Three plaintiffs sued as representatives of a class of 75 individuals allegedly injured by a defectively designed product in federal district court. The three plaintiffs asserted product liability claims under state law, and alleged that they each suffered injuries resulting from the defectively designed product. Two of the named plaintiffs, as well as the unnamed plaintiffs, suffered relatively minor injuries, and asserted damages ranging from $10,000 to $25,000. The third named plaintiff, who suffered severe physical injuries, sought damages of $200,000. None of the named plaintiffs are domiciled in the state where the manufacturer is incorporated and has its principal place of business. The defendant manufacturer has asserted that the federal district court lacks subject-matter jurisdiction. What is the plaintiffs’ best argument that the court may exercise jurisdiction over their claims?
A. As long as one plaintiff in a putative class asserts a good faith claim over $75,000, a court may exercise supplemental jurisdiction over the remaining claims.
B. The amount-in-controversy requirement for diversity jurisdiction is satisfied for all claims of a putative class if any putative class member asserts a good faith claim over $75,000.
C. The claims of the putative class members may be aggregated to satisfy the amount-in-controversy requirement for diversity jurisdiction.
D. There is no amount-in-controversy requirement for class actions if there is complete diversity between the parties.
Answer choice A is correct. In general, if any member of a putative class does not have a claim that meets the statutory jurisdictional amount, then the amount-in-controversy requirement is not met. If, however, at least one plaintiff in a putative class action has a claim that meets the statutory jurisdictional amount, the other plaintiffs can be made part of the class under the doctrine of supplemental jurisdiction. In this case, one plaintiff had a claim that exceeded $75,000; thus, the court can exercise supplemental jurisdiction over the remaining claims. Answer choice B is incorrect because every member of a putative class must generally meet the amount-in-controversy requirement for diversity jurisdiction to exist. Although it is generally true in practice that claims not meeting the minimum amount will be aggregated under supplemental jurisdiction, answer choice B is not technically a correct statement of law, making answer choice A the better answer. Answer choice C is incorrect because the claims of putative class members are not generally aggregated. The Class Action Fairness Act of 2005 does permit aggregation of claims, but in only in cases of 100 or more class members. Here, there are only 75 class members. Answer choice D is incorrect because it is an incorrect statement of law—the amount-in-controversy requirement does apply to class actions, even if there is complete diversity between the parties.
SUBJECT MATTER JUR: Diversity Jurisdiction
A landowner filed an action in federal district court to void a contract for sale of her land to a limited partnership for $500,000. The landowner lived in the forum state. As required by state law, the limited partnership had filed a certificate of limited partnership with the Secretary of State for the forum state. The sole general partner of the limited partnership was a corporation that was incorporated in another state where it also had its principal place of business. The limited partners were citizens of various states, including at least one limited partner who was a citizen of the forum state.
Does the court have subject-matter jurisdiction over this action?
A. No, because the limited partnership filed a certificate of limited partnership with the Secretary of State for the forum state.
B. No, because a limited partner is a citizen of the same state as the landowner.
C. Yes, because the general partner and the landowner are citizens of different states and the amount-in-controversy requirement is satisfied.
D. Yes, because the action was filed in the state where the land was located.
Answer choice B is correct. Since this is a contract action governed by state rather than federal law, diversity jurisdiction must exist in order for the federal district court to have subject-matter jurisdiction. The amount-in-controversy requirement is satisfied since the value of the land exceeds $75,000; but, the diversity-of-citizenship requirement is not. In testing whether this requirement is satisfied with respect to a limited partnership, the citizenship of each member of the partnership, limited partners as well general partners, must be taken into account. Because a limited partner is a citizen of the same state (i.e., the forum state) as the plaintiff-landowner, diversity jurisdiction does not exist. Answer choice A is incorrect because whether the diversity-of-citizenship requirement has been met with respect to a limited partnership depends on the citizenship of the partners, not the state in which the limited partnership has filed a certificate of limited partnership. Answer choice C is incorrect because, in testing whether the diversity-of-citizenship requirement has been met with respect to a limited partnership, the citizenship of the limited partners as well as that of the general partners must be considered. Answer choice D is incorrect because the location of the property that is the underlying subject of the lawsuit is not relevant to the determination of the existence of subject-matter jurisdiction.
PERSONAL JUR: In Personam Jurisdiction
A woman, who was a citizen of State A, was injured in an automobile accident on a highway in State A when a truck collided with her car. The truck driver was a citizen of State Z, located across the country from State A. Although the woman had no contacts with State Z, she filed suit in federal district court in State Z under diversity jurisdiction, asserting damages resulting from the truck driver’s negligence. The truck driver timely filed a counterclaim against the woman, asserting that the woman’s negligence had caused the accident and claiming damages as a result. Deciding not to litigate the matter, the woman withdrew her complaint. The truck driver, however, refused to withdraw his counterclaim and is seeking to go to trial in the matter. The woman has filed a motion to dismiss the case, asserting that the court lacks personal jurisdiction over her.
How should the court rule on the woman’s motion to dismiss?
A. Deny the motion, because the court has supplemental jurisdiction over the counterclaim.
B. Deny the motion, because the woman consented to being sued in State Z.
C. Grant the motion, because the woman does not have sufficient contacts with State Z to justify an assertion of personal jurisdiction.
D. Grant the motion, because the woman was only present in State Z for the purposes of her complaint, which has been withdrawn.
Answer choice B is correct. A plaintiff who has filed a lawsuit in a court is deemed to have consented to the court’s personal jurisdiction with regard to any counterclaim asserted against her. Here, by filing suit in federal district court in State Z, the woman consented to the personal jurisdiction of the federal district court on the matter and for any counterclaims asserted against her. Answer choice A is incorrect. Supplemental jurisdiction addresses the subject matter jurisdiction, not personal jurisdiction, of the court. The woman’s motion deals with personal jurisdiction, which the court has because the woman instituted her original complaint in State Z. Answer choice C is incorrect. While the woman did not have any contacts with State Z prior to instituting her suit against the truck driver, by instituting her suit, she is deemed to have consented to personal jurisdiction with regard to the counterclaim. Answer choice D is incorrect. The fact that the woman withdrew her complaint does not deprive the court of personal jurisdiction over her.
MULTIPLE PARTIES & CLAIMS: Joinder of Claims
An engineer brought suit against her former employer, a large technology company, in federal district court for violating a patent that she owned. She claimed $50,000 in damages. The engineer also sought to join a state law breach-of-contract claim against the company; the claim was based on the engineer’s assertion that the company had not paid her a $10,000 bonus she had earned one year before leaving the company. The engineer and the company are citizens of the same state.
Does the court have subject-matter jurisdiction over the contract claim?
A. Yes, because joinder is permitted under these circumstances and thus supplemental jurisdiction applies.
B. Yes, because the claims are required to be joined and thus supplemental jurisdiction applies.
C. No, because the engineer’s contract claim does not arise out of the same set of facts as the patent claim.
D. No, because the claims, even when aggregated, do not meet the amount-in-controversy requirement.
Answer choice C is correct. A party asserting a claim may join with it as many independent or alternative claims of whatever nature against the opposing party so long as the court has subject-matter jurisdiction over the new claims. If the original claim is based on federal-question jurisdiction, as it is here, then a non-federal claim (such as the state law breach-of-contract claim here) may be joined only if diversity jurisdiction exists or if the new claim arises out of the same case or controversy as the federal claim such that supplemental jurisdiction applies. In this case, the requirements for diversity jurisdiction are not satisfied because the engineer and the company are citizens of the same state. The claims are also not part of the same case or controversy because one concerns the company’s patent violation, while the breach-of-contract claim is a separate cause of action based on the company’s failure to pay the engineer a bonus and does not arise from the same operative facts as the patent claim. Answer choice A is incorrect because joinder is not allowed when the court lacks subject-matter jurisdiction over the claim to be joined. Answer choice B is incorrect. Joinder of claims by a plaintiff is never required. (Note, however, that as a practical matter, claims that are not joined may be precluded by res judicata.) Answer choice D is incorrect. Rule 18(a) allows for joinder of a state law claim to a federal claim, but only if the requirements for subject-matter jurisdiction have been independently satisfied by the joined claims. Here, the plaintiff and defendant are citizens of the same state.
TRIAL PROCEDURE: Motion for a New Trial
A patient properly brought a negligence action in federal district court against a hospital for damages incurred as a consequence of a fall due to substandard nursing care. The patient established medical expenses attributable to the fall in the amount of $80,000, and also requested $40,000 for pain and suffering. The jury found for the patient and awarded all medical expenses, but pain and suffering of only $10,000. The patient filed a motion for a new trial on the issue of damages. The court conditionally granted this motion, but gave the hospital the option of avoiding a new trial if the hospital agreed to pay the patient the $80,000 for the patient’s medical expenses, as well as $25,000 for her pain and suffering.
Was the court’s action proper?
A. Yes, because the court did not order the hospital to pay $25,000 in pain and suffering damages to the patient.
B. Yes, because a court does not abuse its discretion by granting a new trial subject to a reasonable condition.
C. No, because a court cannot condition a new trial order on a party’s refusal to accept a damages amount determined by the court.
D. No, because additur is not permitted in a federal court action.
Answer choice D is correct. Additur, which is an increase by the court in the amount of damages awarded by a jury, is not permitted in a federal court action. Such an enhanced verdict violates the Seventh Amendment right to a jury trial. Answer choice A is incorrect. Even though the court did not order the payment of an amount in excess of the amount of the jury award but instead gave the hospital an option to avoid relitigating the issue of damages, this option is not permitted in a federal court action because of the Seventh Amendment. Answer choice B is incorrect. While the court’s granting of a new trial on the issue of damages under these facts does not constitute an abuse of its discretion, it cannot condition that grant on the defendant’s agreement to pay damages in excess of the amount awarded by the jury. Answer choice C is incorrect because a federal court can condition a new trial order on the plaintiff’s refusal to accept a damages amount less than the amount awarded by a jury (i.e., remittitur).
POST-TRIAL PROCEDURE: Alteration of or Relief of a Judgment
A man was severely injured when a manufacturer’s ladder malfunctioned. The man filed suit against the manufacturer in federal district court under diversity jurisdiction, alleging that the ladder was defective. After a long trial, judgment was entered for the manufacturer on April 1. In March of the following year, new evidence emerged indicating that the manufacturer was aware that the ladders were defective, but had nevertheless allowed them to be distributed to retail stores. This evidence was not discovered earlier despite the best efforts of the man’s attorney. On April 15, the man filed a motion for relief from judgment.
Should the court grant the man’s motion?
A. No, because the motion was not timely.
B. No, because the court must order a new trial.
C. Yes, because of the newly discovered evidence that could not have been discovered earlier with reasonable diligence.
D. Yes, because the enforcement of the judgment would likely result in injustice.
Answer choice A is correct. A motion for relief from judgment under Rule 60(b) must be filed within a reasonable time and no later than one year following the entry of the judgment. Here, judgment was entered for the manufacturer on April 1. The man’s motion for relief from judgment was filed on April 15 of the following year. Thus, the man’s motion was not timely and should be denied. Answer choice B is incorrect. The man’s motion was for relief from judgment, not for a new trial. Furthermore, the court is not required to order a new trial but may do so on its own initiative or upon the motion of a party based on the discovery of new evidence. However, the time for doing so has passed. Answer choice C is incorrect. Although the discovery of new evidence that could not have been discovered earlier with reasonable diligence is a proper ground for granting relief from judgment, the man’s motion was filed more than a year after the entry of judgment and should be denied as a result. Answer choice D is incorrect because Rule 60(b) sets a specific time limit for a motion for relief from judgment based on newly discovered evidence, regardless of the unfairness that might result.
SUBJECT MATTER JURISDICTION: Supplemental Jur
The plaintiff, a resident of State A, was visiting the home of the defendant, who resides in State B. As the plaintiff was leaving the house, she fell through a rotted plank in the front steps and broke her ankle. The plaintiff underwent several surgeries and extensive rehabilitation. She brought suit in federal district court, alleging that the defendant negligently maintained her premises and asking for relief in the amount of $150,000. The defendant filed a counterclaim alleging that the plaintiff owes her $5,000 as payment for web design work that the defendant completed for the plaintiff. If the plaintiff filed a motion to dismiss the defendant’s counterclaim for lack of jurisdiction, will the plaintiff succeed?
A. No, because the parties maintain complete diversity.
B. No, because the federal district court may exercise supplemental jurisdiction over counterclaims.
C. Yes, because the defendant’s counterclaim does not meet the amount-in-controversy requirement for diversity jurisdiction.
D. Yes, because the federal district court may only exercise supplemental jurisdiction when the action includes compulsory counterclaims.
Answer choice C is correct. A federal court may assert supplemental jurisdiction over a counterclaim that does not satisfy the jurisdictional amount when the counterclaim is compulsory. However, a permissive counterclaim does not qualify for supplemental jurisdiction and therefore must satisfy the jurisdictional amount and the rule of complete diversity. Here, the defendant’s claim that the plaintiff owes her money does not arise out of the same transaction and occurrence as the plaintiff’s injuries. Therefore, the defendant’s counterclaim is permissive and must meet the amount-in-controversy requirement for diversity jurisdiction. Answer choice A is incorrect. Although the parties must maintain complete diversity, a permissive counterclaim must also meet the amount-in-controversy requirement. Answer choice B is incorrect. Although the federal district court may exercise supplemental jurisdiction over counterclaims, a permissive counterclaim needs to meet the requirements for federal subject-matter jurisdiction (either diversity or federal question). Answer choice D is incorrect. While it is true that the defendant’s counterclaim is not compulsory, it would be possible for the federal court to assert supplemental jurisdiction had the defendant met the amount-in-controversy requirement. Therefore, D is not the best answer choice.
SUBJECT MATTER JURISDICTION: Removal Jur
A plaintiff filed a complaint in state court against a defendant, alleging damages from negligence resulting from an automobile accident. The defendant removed the case to federal district court. The federal district court, finding that there was no subject-matter jurisdiction in federal court, issued an order remanding the case to state court. The defendant believes that the court’s remand is improper and wants to appeal the order remanding the case to state court.
Which of the following is most accurate regarding the remand order?
A. Appeal of the remand order is improper.
B. Once a case is removed, remand is improper.
C. Review of a remand order to state court is proper only upon the issuance of a final judgment.
D. The remand order is appealable if the application for review is made no more than 10 days after entry of the order.
Answer choice A is correct. A remand order is generally not reviewable on appeal or otherwise (except for an order remanding a civil rights case removed pursuant to § 1443 or a remand order in a class action, if the application for review is made to the court of appeals not more than 10 days after the entry of the order). Thus, appeal of the remand order would be improper. Answer choice B is incorrect. Remand of a removed case is proper under a variety of circumstances, including, as here, when the court finds that it lacks subject-matter jurisdiction over the case. Answer choice C is incorrect. Generally, a remand order is not reviewable by an immediate appeal or otherwise. Answer choice D is incorrect. The 10-day time limit is only applicable to a remand order in a class action. In general, a remand order is not appealable.
