Business Law Chapter 2

Subject Matter Jurisdiction

Limits the court's jurisdictional authority to particular types of cases and can be either limited or general jurisdiction.

What type of statute allows one state to reach into another state and bring a defendant into the first state's courts?

Long-arm statues

Horton Automatics and the Industrial Division of the Communications Workers of America—the union that represented Horton's workers—negotiated a collective bargaining agreement. If an employee's discharge for a workplace-rule violation was submitted to arbitration, the agreement limited the arbitrator to determining whether the rule was reasonable and whether the employee had violated it. When Horton discharged its employee, Ruben de la Garza, the union appealed to arbitration. The arbitrator found that de la Garza had violated a reasonable safety rule, but "was not totally convinced" that Horton should have treated the violation more seriously than other rule violations. The arbitrator ordered de la Garza reinstated to his job. Can a court set aside this order from the arbitrator?

Look down

Marya Callais, a citizen of Florida, was walking along a busy street in Tallahassee, Florida, when a large crate flew off a passing truck and hit her, causing numerous injuries. She experienced a great deal of pain and suffering, incurred significant medical expenses, and could not work for six months. She wants to sue the trucking firm for $300,000 in damages. The firm's headquarters are in Georgia, although the company does business in Florida. In what court might Callais bring suit—a Florida state court, a Georgia state court, or a federal court? What factors might influence her decision?

Look down

What state(s) have personal jurisdiction over the trucking firm?

1. Georgia 2. Florida

A court generally will set aside an arbitrator's award for one of the following reasons:

1. If the arbitrator's conduct prejudiced the rights of a party 2. If the award violates established public policy 3. If the arbitrator exceeded his or her powers

Why? (107)

1. Residents of different states 2. Over 75,000

Why? (105)

1. She has to travel there 2. She has to get a lawyer there 3. Witnesses have to travel there

The percentage of cases that are settled through some form of ADR is approximately

90%

Which one of the following is NOT involved in the two basic pleadings of a lawsuit?

A default judgement

In preparation for a trial between George and ABC Corporation, ABC's attorney places George under oath and asks George questions that are recorded by a court reporter. This is known as

A deposition.

Baker loses the trial. Baker's attorney can make a motion for

A judgement not withstanding the verdict.

Mediation

A neutral third party meets with the parties and emphasizes points of agreement to bring them toward resolution of their dispute.

Arbitrator

A neutral third party or panel of experts that hears a dispute in arbitration.

Arbitration Clause

A part of the contract that provides that, in the event of a dispute, the parties will submit the dispute to arbitration rather than litigate the dispute in court.

Pretrial Conference

A pretrial hearing after discovery. The goal is settlement

A federal court can exercise jurisdiction if a case involves:

A treaty, the U.S. Constitution, or a federal law

Which of the following does the U.S. Supreme Court have to issue before it hears a case?

A writ of certiorari.

In the case, the plaintiffs may ask the Montana courts to use a long arm statute. A long arm statute:

All of these are correct

If Caleb is correct that the contract had an arbitration clause, and the clause was valid, which of the following is true?

Arbitration involves a neutral third party or a panel of experts to hear the dispute and impose a binding resolution on the parties.

The order to reinstate de la Garza to his job is called the arbitrator's

Award

The Johnsons are in an auto accident with a driver who lives near them in the same town. No one is injured and the Johnsons' car suffered only $5,000 in damages. Why can't the Johnson's sue the other driver in federal court?

Because the Johnson's live in the same state and the damages are too small

If the court in Montana wants to be able to hear the case against Wizard internet the court has to have:

Both jurisdiction over the Wizard internet & jurisdiction over the subject matter of the lawsuit.

Your attorney prepares a _________ to present to the appellate court when you decide to appeal the trial court's decision.

Brief

Exclusive State Jurisdiction

Cases involving all matters not subject to federal jurisdiction.

Exclusive Federal Jurisdiction

Cases involving federal crimes, bankruptcy, patents, copyrights, trademarks, and suits against the United States.

Concurrent Jurisdiction

Cases involving federal questions and diversity-of-citizenships cases.

Standing to sue has three elements. Highlight the correct three:

Causation, Remedy, Harm

Why? Because the ________ will have a _____________ review of the decision of an ____________ and there is ____________ that any of the three reasons for setting aside the award are present.

Court, Limited, Arbitrator, No evidence

Appellate or Reviewing Courts

Deal with questions of law.

In order for Marya to sue the trucking firm, she has to file the lawsuit in a court that also has personal jurisdiction over the

Defendant

Baker runs into the back of Li's car. Anderson appears to be at fault. Baker will be the __________ and will probably receive a ___________.

Defendant, Summons

In this case, the arbitrator ______ decide something beyond the issues subject to arbitration.

Did

At the conclusion of the plaintiff's case, the defendant's attorney may ask for a

Directed verdict.

Jury Selection

During the process of void dire, prospective jurors can be challenged.

Appellate Jurisdiction

Exists with courts of appeal and review.

Original Jurisdiction

Exists with courts that have the authority to hear a case for the first time, called trial courts.

As part of Baker's affirmative defense, he can argue that Li is lying about the auto accident.

False

In preparation for the trial between Baker and Li subsequent to the auto accident, Li's attorney places Baker under oath and asks Baker questions that are recorded by a court reporter. This is known as an interrogatory.

False

The Federal Arbitration Act established a set arbitration procedure.

False

The U.S. Supreme Court hears all cases sent to it for review.

False

The United States Supreme Court has held that mandatory arbitration clauses in employment contracts are generally unenforceable.

False

Venue refers to the primary subject matter of a case at trial.

False

When a state exercises jurisdiction over property within that state, this type of jurisdiction is called in personam.

False

Why? Yes, because it caused the accident in

Florida

A trial between Shane and Verna results in a jury verdict in Shane's favor. After the jury renders its verdict, Verna's attorney can file a motion

For a new trial.

Why? Its headquarters is in ___________ and does business in ______________.

Georgia, Florida

Finally, the arbitrator decided that

Horton should not have treated this violation more serious than others

Negotiation

In regard to dispute settlement, a process in which parties attempt to settle their dispute without going to court, with or without attorneys to represent them.

Award

In the context of arbitration, the arbitrator's decision.

Because of that, a court is _______ to set aside the arbitrator's award

Likely

The power of judicial review has remained unchallenged since which Supreme Court decision?

Marbury v. Madison

Who is the potential plaintiff in this lawsuit?

Marya

Britney files a lawsuit against Kevin and wants her case settled as quickly and with as little cost as possible. Her best option is

Mediation.

Why? There were no _______________ contacts. Courts have held that generally the company must be advertising or selling goods in the state to have minimum contacts.

Minimum

Why? Yes, if the trucking firm has ____________ contacts in Florida.

Minimum

A long arm statute allows one state's court to exercise jurisdiction over a defendant from another state who has _______________ with the state in which the court is located.

Minimum contacts

Attorneys may file pretrial motions.

Motion to be excused, Motion for summary judgement

James, a homeowner, files a lawsuit against Helen, his construction contractor. Prior to trial, they meet with their attorneys to try to resolve their dispute before going to trial. This procedure is known as

Negotiation

The simplest form of ADR is

Negotiation

Jackson, a homeowner, files a lawsuit against Johnson, his construction contractor. Prior to trial, they meet with their attorneys to try to resolve their dispute before going to trial. This proceeding is known as

Negotiation.

When parties arbitrate, the arbitrator is a __________ third party

Neutral

Does Marya want to sue the trucking firm in Georgia?

No

If the collective bargaining agreement did not specifically address the items that the arbitrator could decide, would a court set aside this award?

No

What if the truck did not cause the accident and was just passing through?

No

Trial Courts

Often deal with questions of fact

When does arbitration usually happen?

On a court order, by agreement of both parties to a dispute

Can Marya sue the trucking firm in Georgia and Florida state courts?

Yes

Can Marya sue the trucking firm in a federal trial court?

Yes

The public has access to electronic court filings through a system called

PACER

Negotiation

Parties meet informally with or without their attorneys and attempt to agree on a resolution.

Assuming that Caleb is correct about the amount of contact that Wizard Internet has had with people in Montana, is it likely that the courts in Montana would have jurisdiction over Wizard?

Probably not, since the company has not reached out to anyone in Montana.

Assume that the plaintiff is the customer from Texas and that customer moved to Montana, would Montana have jurisdiction?

Probably not, since the company itself did not reach out to Montana.

Which of the following is NOT part of the discovery process:

Requesting another trial.

Mediation

Settling disputes in which a third party assists disputing parties in reconciling their differences.

Online dispute resolution is typically best for resolving

Small-sized business liability claims

Toybox, Inc., manufactures the Spintop, a toy that the company discovers can cause harm. Before anyone is injured, Anne, a pediatric nurse who has not purchased a Spintop, files a suit against Toybox, Inc. In seeking to have the suit dismissed, Toybox, Inc., best argument is that Anne does not have

Standing to sue

Does the firm have minimum contacts in Florida?

Yes

Drag and drop the appropriate words to fill in this exhibit of state and federal court systems:

Supreme Court of the United States Left: U.S. Courts of Appeals Federal Administrative Agencies, U.S. District Courts, Specialized U.S. Courts Right: Highest State Courts State Courts of Appeals, State Administrative Agencies State Trial Courts of General Jurisdiction Local Trial Courts of Limited Jurisdiction

Charles loses his breach-of-contract case against Micheletta in a Georgia state trial court. Charles appeals to the state court of appeals. Losing again, he files his next appeal with

The Georgia Supreme Court

Filing the appeal

The appealing party files a notice of appeal with the clerk of the trial court.

Appellate Review

The appellate court does not hear evidence. The appellate court may affirm or reverse the trial court's judgement or remand the case for the further proceedings.

Arbitration differs from other forms of ADR because:

The arbitrator hears the dispute and imposes a solution on the parties.

Assume that the lawsuit was for $100,000 and the state of Texas had personal jurisdiction over all of the parties and proper subject matter jurisdiction. Which of the following is true?

The case could be heard in either a federal court in Texas or a state court in Texas.

What if the trucking firm did not do business in Florida but was just passing through-Could Marya still sue in Florida?

Yes

Arbitration

The parties present their arguments and evidence before an arbitrator at a hearing and the arbitrator renders a decision resolving the parties' dispute.

Litigation is

The process of moving a case through the courts.

Litigation

The process of resolving a dispute through the court system.

Alternative Dispute Resolution (ADR)

The resolution of disputes in ways other than those involved in the traditional judicial process. Negotiation, mediation, and arbitration are forms of ADR.

Online Dispute Resolution

The resolution of disputes with the assistance of organizations that offer dispute-resolution services via the Internet.

Arbitration

The settling of a dispute by submitting it to a disinterested third party (other than a court), who renders a decision. The decision may or may not be legally binding.

A major not-for-profit provider of ADR services is

the AAA

Choose the flow chart below that represents the ordering of most court systems (state and federal).

Trial Courts, Intermediate Appellate Courts, Supreme Courts

Who is the potential defendant?

Trucking firm

When a jury reaches its decision, it typically issues a verdict in favor of one party.

True

When one party files a lawsuit to compel arbitration, the courts must resolve the issue of arbitrability.

True

Highlight among the following possible answers those that are part of the federal court system:

U.S. District Courts, United States Supreme Court

Most states have adopted the

Uniform Arbitration Act

Under what circumstances will a judge grant a motion for a new trial?

When the jury clearly misapplied the law or misunderstood the evidence.

Juan files a lawsuit against Liliana. Liliana responds to the complaint by filing an answer. After the pleadings are closed, Juan can file

a motion for judgment on the pleadings.

Vinny decides to sue Allison. To begin the suit, Vinny must file a complaint. A complaint should contain

a statement of the basis for the court's jurisdiction.

In this case, the arbitration happened

because the parties agreed through the collective bargaining agreement

How does a court get personal jurisdiction over a plaintiff? When the plaintiff files a ____________ in that court.

complaint

Robert, who lives in Ohio, files a lawsuit against Trading Post, a Washington company, in an Ohio state court. The Trading Post's only sales activity outside the state of Washington occurs via its Web site. According to the sliding-scale standard, the Ohio court can always exercise personal jurisdiction over out-of-state defendants based on Internet transactions if the court finds that the defendant has

conducted substantial business with Ohio residents through its Web site.

The arbitrator also decided that

did violate the rule

Miller signed an employment contract containing an arbitration clause stating that "any dispute" arising during employment must be resolved by binding arbitration. Two years later, after she was injured on the job and took leave to recover, she was fired. She filed a complaint for disability discrimination with the Equal Employment Opportunity Commission, which gave her a "right to sue" letter. She then filed suit in federal court against her employer for disability discrimination. The court

dismissed the suit because of the arbitration agreement.

John is a resident of Iowa. While driving through California, he has an accident involving Marisol, a California resident. Marisol files a lawsuit in a California state court. Over John, the California court has

in personam jurisdiction

Arbitrability

involves a court deciding whether a matter is one that must be resolved through arbitration.

Karl sells Jason his house. After moving in, Jason learns that Karl failed to disclose serious defects in the house. Jason sues Karl. After the pretrial procedures are completed, the case enters the trial phase. The attorneys begin the process of voir dire. During voir dire

jurors are picked from a jury pool.

Cal-Ban 3000 was a weight-loss drug made by Health Care, a Florida corporation. Tart, a citizen of North Carolina, read ads for the product in a newspaper and bought Cal-Ban in North Carolina from a local pharmacy. Within a week of taking the supplement, Tart suffered a ruptured colon. Alleging that the injury was caused by Cal-Ban, Tart sued Health Care in a North Carolina state court. Health Care asked the court to dismiss the case, arguing that the North Carolina court could not exercise personal jurisdiction over Health Care. The court most likely

refused to dismiss the case, because the defendant had placed the product in the stream of commerce in North Carolina and was subject to being sued in North Carolina.

Stan, a citizen of Iowa, files a lawsuit in an Iowa state trial court against Jalisco Farm Supply, a Texas company that sells supplies in Iowa. The court has original jurisdiction because

the case is being heard for the first time.

The doctrine of judicial review allows

the judicial branch to decide whether laws or actions of the other two branches are constitutional.

The arbitrator decided that

the rule was reasonable

Marco files a lawsuit against Allied Company in an Oregon court with limited jurisdiction. The difference between general and limited jurisdiction is based on

the subject matter of the cases that the court can decide.

The collective bargaining agreement limited the arbitrator to deciding

whether the rule was violated, whether the rule was reasonable