MULTIPARTY LITIGATION Flashcards
NECESSARY AND INDISPENSABLE PARTIES
What are necessary (“required”) parties that must be joined?
If a party is “necessary”, the court may order joinder of the absenteePROVIDED the ct has pjx over the party and joinder won’t mess up diversity
“Necessary” =
(i) Without the absentee party, the ctcannot accord complete relief among those already joined (worried about multiple suits); OR
(ii) The absentee’s interest will be harmed if he isn’t joined (practical harm) (worried about absentee party) (MOST TESTED RATIONALE ON BAR EXAM); OR
(iii) Absentee claims an interest which subjects a party (usually ∆) to possibility of multiple obligations (worried about ∆’s interests)
NOTE: Joint tortfeasors are NOT necessary
If party CANNOT be joined b/c no pjx over the party or b/c joinder would mess up diversity the ct has 2 choices:
(1) the court may proceed w/o absentee party; OR
(2) the court may dismiss the ENTIRE case→
Deciding which action to take is based on balancing the following factors:
(i) Whether there is an alternative forum available where EVERYONE can be joined
(ii) The likelihood of real harm to anybody by proceeding w/o absentee
(iii) Whether the ct do anything to avoid harm to absentee
NOTE: IF the ct, dismisses, then absentee was “INDISPENSABLE PARTY”
JOINED PARTIES: Types of Joinder
What 5 types of claims may be joined in a pending case?
Type of Joinders
* Counterclaims
- Cross-claims
- Impleader
- Intervention
- Interpleader
TIP:
“C” claims are for claims between parties already in the case
“I” claims are for claims involving new parties to the case
COUNTERCLAIM
What is a counterclaim?
Claim against an OPPOSING PARTY filed with the responsive pleading (answer) (usually ∆ asserting counterclaim against π)
Two Types → Compulsory OR Permissive
1) Compulsory CC– arises from same T/O as π’s claim.
UNLESS already filed in a different case, it MUST be filed with ∆’s answer or else waived – cannot sue on CC in separate case
A CC is NOT WAIVED if ∆ moved to dismiss w/o answering→ if granted, ∆ can still bring action against π in separate case
THIS is the ONLY COMPULSORY CLAIM!
**Note: COMMONLY TESTES TOPIC ON the BAR
2) Permissive CC – NOT from same T/O so may choose to assert here or may do so in a separate case.
**REMEMBER: Ct must ALWAYS have SMJrx over a claim!!
→ First look to diversity, alienage, FQ
→ IF NOT, THEN try supplemental JRX
(i) BUT need same T/O and also other Supp Jrx rules
(ii) Recall that Supp jx okay for compulsory CC even if less than $75k (maybe o.k. for permissive if has “loose connection w/ original claim”)
CROSSCLAIM
What is a crossclaim?
Claim against a co-party
CLAIM MUST arise from same T/O as the underlying action
NOT COMPULSORY → You do NOT have to file a crossclaim or risk waiver (NEVER compulsory)
**REMEMBER: a ct must be smjx over claim!! → look to diversity, alienage, FQ first - THEN try supp jx
IMPLEADER
What is a impleader?
Impleader = ∆ joins a third-party defendant (TPD) b/c TPD might be liable to the defending party for the full claim against the defending party (indemnity) or to cover a pro-rata portion of the claim (contribution)
Timing
The ∆ has right to implead w/in 14 DAYS after serving answer but after that the ∆ would need Ct. permission
STEPS:
- ∆ files a third-party complaint naming the TPD;
- ∆ serves process on the TPD (so must have pjx over TPD!)
NOTE: After the TPD is joined, π and TPD can assert claims against each other IF from the same T/O
**REMEMBER: a ct must be smjx over claim!! → look to diversity, alienage, FQ first - THEN try supp jx
NOTE: diversity jrx is determined by looking at ∆ and TPD ONLY. π is NOT involved in the assessment
NOTE: for supplemental jrx, the limitation on diversity jrx when AIC is not met does not apply to adding the TPD b/c ∆ is NOT seen as a π in the impleader process
INTERVENTION
What is a intervention?
Intervention= absentee party inserts herself into the suit. The absentee WANTS to join a pending suit
Absentee chooses whether to intervene as a π or ∆& the court can realign her if she came in on the wrong side.
Application to intervene must be “timely”
2 TYPES of INTERVENTION
1) Intervention of right → must show that absentee’s interests may be harmed if she is not joined & not adequately represented now (same rationale as the second test under necessary parties analysis)
2) Permissive intervention → A’s claim or defense & the pending case have at least one common question → Court has discretion to allow this type of intervention
* *REMEMBER: a ct must be smjx over claim!! → look to diversity, alienage, FQ first - THEN try supp jx
What is a interpleader?
Interpleader= one holding money or property (“stakeholder”) wants to force all potential claimants into a single lawsuit to avoid multiple litigation & the threat of inconsistent results Ct. may issue injunction stopping parties from litigating ownership question in another court.
TYPES 1) Rule Interpleader – (1) Complete diversity (stakeholder must be diverse from every claimant); (2) AIC = $75k+; (3) regular service of process; (4) regular venue rules 2) Statutory Interpleader – (1) Minimal diversity (1 claimant must be diverse from 1 other claimant - don’t even look at the stakeholder’s citizenship); (2) AIC = $500 or more; (3) Nationwide service of process; (4) venue lies in a district where any claimant resides Easier std
CLASS ACTION
What are the 4 initial requirements for a class action?
BIG TOPIC ON BAR EXAM!
STEP 1: ALL 4 Requirements MUST be met to Initiate a Class Action: make a showing that…
(1) NUMEROSITY: there are too many class members for practicable joinder
(2) COMMONALITY: some questions of law or fact are in common to all class members so resolution of the issues will generate answers for everybody in one stroke
(3) TYPICALITY: Rep’s claims/defenses are typical of those of the class; AND
(4) REPRESENTATIVE ADEQUATE: The class representative will fairly & adequately represent the class
STEP 2: The class action must fit w/in one of these 3 types of actions
(1) Prejudice - class treatment necessary to avoid harm to class members or to opposing party (numerous claimants to a fund that could deplete before all claimants get to court)
(2) Injunction or declaratory judgment (not damages) sought b/c class members were treated alike by the other party (e.g. employment discrim.) (this type of action cannot seek damages)
* *(3) Damages - (i)common questions “predominate over individual questions”;and (ii) class action is the superior method for resolving the dispute (e.g. mass tort)
CLASS ACTION
What actions does a ct take in a class action?
1) The ct must determine “at any early practicable time” whether to CERTIFY the case to proceed as a class action
The complaint may say “class action” but it is not a class action until the Ct. CERTIFIES the CLASS
2) The ct. must “define the class and the class claims, issues, or defenses” after it certifies the class.
3) The Ct. must appoint class counsel who must fairly and adequately represent the interests of the class
4) In a damages type class (ONLY), the ct must notify (often by mail, paid for by class rep) all reasonably identifiable members, telling them various things, including:
(i) that they can can opt out;
(ii) that they’ll be bound if they don’t; AND
(iii) that they can enter a separate appearance through counsel
Note: this notice is NOT rqrd in type 1 and type 2 class action cases
The representative pays to give the notice
5) All members of the class are bound, EXCEPT those who opt out of the damage type class (NOTE: there is NO right to opt out of a “prejudice” or “injunction” class)
5) Parties can dismiss OR settle a certified class action ONLY w/ ct approval
Ct. gives notice to class members of settlement before approving it to solicit their input. The ct. may also give class members in a damages class action a second opportunity to opt. out.
CLASS ACTION
How do you show smjx w/ class action?
CLass actions needs smjx and can be based on:
- Fed Q
- Diversity (based on representative)
i. e. Rep’s diverse from all ∆s (class members irrelevant) & Rep’s claim exceeds $75k
Class Action Fairness Act (CAFA) – contains a grant of smjx separate from regular diversity
Federal smjx if: (i) Any class member is diverse from any ∆ (minimal diversity); AND
(ii) 100 class members or more; AND
(iii) Aggregate amount in controversy exceeds $5M
Additional Claims
Once a counterclaim or a crossclaim (or any claim) has been filed, a party can join an additional claim to it – even if that claim has nothing to do with the others
NOTE: The additional claim (like any claim in federal court) must invoke federal SMJ so ALWAYS FIRST assess if there is diversity, alienage, FQ first - THEN try supp jx
