Federal Civil Procedure

Diversity Jurisdiction - Unincorporated Associations

1. Citizenship. In claims based on federal law for or against an unincorporated association, the association has entity capacity, but the question of its citizenship is normally irrelevant because the court will have federal question jurisdiction. When diversity jurisdiction is involved, an unincorporated association: a. may sue or be sued in its own name if local state law so permits; or b. is an aggregate of individuals if local state law follows the common law rule. In either case, the unincorporated association's citizenship is that of EACH AND EVERY ONE of its members. 2. Class Action. If the association is large, a class action is possible. If a class action is brought, the relevant citizenship is that of the NAMED MEMBERS who sue or are sued on behalf of the members of the association. 3. Partnerships. The citizenship of a general partnership is that of each and every general partner, and the citizenship of a limited partnership is that of each and every partner, both limited and general. 4. Limited Liability Companies. Although limited liability companies are formed in a manner similar to corporations, they are treated as unincorporated associations for citizenship purposes. Thus, an LLC is a citizen of all states in which its members are citizens.

Diversity Jurisdiction - Realignment According to Interest

1. May Create or Destroy Diversity. In determining whether diversity exists, the court will look beyond the nominal designation of the parties in the pleadings and realign them according to their true interests in the dispute. Thus, realignment may create diversity or destroy it. 2. Shareholder Derivative Actions. Taking the view that the shareholder's alignment of the corporation as a party plaintiff or defendant is not controlling insofar as diversity jurisdiction is affected by the citizenship of the corporation, the federal courts have established the rule (at least when alignment of the corporation in a shareholder's derivative suit is not specifically provided for by state law) that the corporation is to be aligned as a party defendant. Federal diversity jurisdiction is determined in accordance with that alignment when, with respect to the claim sought to be enforced by the shareholder's derivative suit, the corporation is "antagonistic" to the shareholder.

Diversity Jurisdiction - Aliens as Additional Parties

28 U.S.C. §1332(a)(3) grants jurisdiction in a case between citizens of different states in which citizens or subjects of a foreign country are additional parties. The foreign parties are disregarded for jurisdictional purposes. Although not entirely clear from the case law, there appears to be no SMJ when there are U.S. citizens on one side of the action and aliens on both sides.

Diversity Jurisdiction - Nonresident United States Citizens

A United States citizen DOMICILED ABROAD is NOT a citizen of any state and also is not an alien. (Alien status depends on nationality, not domicile.)

Voluntary Appearance

A defendant may consent to jurisdiction by voluntary appearance, i.e., by contesting the case without challenging personal jurisdiction. Generally, any sort of appearance provides a sufficient basis for jurisdiction, but many state allow "SPECIAL APPEARANCES" through which a defendant can object to the court's exercise of jurisdiction. The defendant usually must make this special appearance--by stating grounds for his objection to jurisdiction--in his initial pleading to the court; otherwise, the defendant will be deemed to have consented to jurisdiction.

Unlimited Long Arm Statutes

A few states, such as California, have long arm statutes that give their courts power over any person or property over which the state can constitutionally exercise jurisdiction.

Diversity Jurisdiction - Legal Representatives

A legal representative of an infant, an incompetent, or an estate of a decedent is deemed to be a citizen of the same state as the infant, incompetent, or decedent.

Express Consent

A party's express consent to the jurisdiction of local courts, whether given before or after suit is commenced, serves as a sufficient basis for in personam jurisdiction. Forms of express consent: 1. By contract. A person can, by contract, give advance consent to jurisdiction in the event a suit is brought against him. 2. By Appointment of Agent to Accept Service of Process. A person can, by contract, appoint an agent in a particular state to receive service in that state in an action against him. The terms of the contract determine the extent of the agent's power and, thus, the scope of the jurisdiction conferred. a. Appointment Required by State. When the state heavily regulates a type of business to protect citizens, it can require a nonresident engaged in that business to appoint an agent for service of process in the state. Note: The state cannot require every nonresident businessperson to appoint such an agent, because the state lacks power to exclude individuals from the state. However, a state can require nonresident corporations to make such an appointment before doing business in the state.

Limited (or Specific) Long Arm Statutes - Limitations in Marital Dissolution Cases

All states provide that when a married couple last lived together in the state and one spouse then abandons the other, the remaining spouse may obtain personal jurisdiction over the absent spouse for divorce or legal separation proceedings. States vary on whether the plaintiff spouse must be living in the state at the time of abandonment (or other cause for dissolution) or whether jurisdiction may be acquired whenever the plaintiff has acquired domicile in the state.

In Personam - Sufficient Contacts with the Forum - 1. CONTACT

Contact. International Shoe requires that the defendant have "such minimum contacts" with the forum that the exercise of jurisdiction would be fair and reasonable. In considering whether there are such contacts, a court will look at two factors: 1. Purposeful Availment. Defendant's contact with the forum must result from her purposeful availment with that forum. The contacts cannot be accidental. Defendant must reach out to the forum in some way, such as to make money there or to use the roads there. The court must find that through these contacts the defendant purposefully availed herself "OF THE PRIVILEGE OF CONDUCTING ACTIVITIES WITHIN THE FORUM STATE, THUS INVOKING THE BENEFITS AND PROTECTIONS OF ITS LAWS." a. "Stream of Commerce" Cases. There is great difficulty is assessing purposeful availment in "stream of commerce" cases. Stream of commerce cases typically arise when Defendant manufactures its product in State A (or Country A) and sells them to a second party in State B, thereby placing the product in the stream of commerce. The product eventually winds up in another state (State C) and causes an injury therein. The question is whether Defendant PURPOSEFULLY AVAILED ITSELF to State C. The Supreme Court has addressed such a scenario twice, but it has failed to reach a consensus both times. For bar exam purposes, the important points to remember are: (i). Merely placing an item in the stream of commerce, by itself, is not a sufficient basis for personal jurisdiction. (ii). It is unresolved whether (probably unlikely that) placing an item in the stream of commerce with the knowledge or hope that it will wind up in a particular state would be a sufficient basis for personal jurisdiction. If you encounter such a question, you should scour the question for facts showing an INTENTIONAL TARGETING (purposeful availment) of the forum. If there is no targeting, you should discuss the connections the defendant has with the forum, and fairness to the defendant, while mentioning the state's interest in providing a forum for its citizens and noting that the question has not been definitively resolved. Must consider whether the defendant is "essentially at home" if the forum for all causes of action. (iii). Placing an item in the stream of commerce, coupled with some OTHER ACT THAT SHOWS INTENT to serve a particular state (e.g., modifying a product to comply with state law, maintaining a sale office within the state, etc.) IS A SUFFICIENT BASIS for personal jurisdiction. b. Internet Cases. The Supreme Court has not set out a specific test or standard for assessing purposeful availment based on the defendant's Internet activities. Many courts will look at whether the defendant has a passive website that allows people to only view content, an active website that allows people to order and download products, or something in between. 2. Foreseeability. In addition to purposeful availment, the contact requirement of International Shoe requires that it be foreseeable that the defendant's activities make her amenable to suit in the forum. The defendant must known or reasonably anticipate that her activities in the forum render it foreseeable that she may be "haled into court" there.

Discovery

Discovery issues principally revolve around the scope of the examination allowed in discovery, the uses of depositions at trial, and the available methods of enforcing discovery rights.

Complete Diversity When Action Is Commenced. Multiple Parties--Complete Diversity

Diversity jurisdiction requires "complete diversity," meaning that no plaintiff may be a citizen of the same state as any defendant. If one defendant and one plaintiff are co-citizens of the same state, complete diversity is lacking and there is no diversity jurisdiction. Diversity jurisdiction is to protect an out-of-state party from possible local bias in state courts. Without complete diversity, no bias to protect against. a. Note. The rule of complete diversity does not require that every party be of diverse citizenship from every other party. It requires only that no plaintiff be a co-citizen with any defendant. Thus, two plaintiffs whoa re both citizens of Missouri may invoke diversity jurisdiction against three defendants, all three of whom are citizens of Kansas. b. Diversity of citizenship or alienage must exist as of the time the suit is instituted. It need not exist at the time the cause of action arose, and it is not defeated if, after commencement of the action, a party later becomes a citizen of the same state as one of his opponents.

Diversity of Citizenship Jurisdiction

Diversity of citizenship jurisdiction under 28 U.S.C. section 1332 is grounded historically in the desire to protect out-of-state parties from local prejudice. Its main requirement is that there be complete diversity between opposing parties. Each plaintiff must be of diverse citizenship from each defendant. Also, the amount in controversy must exceed $75,000.

Statutory Limitations on In Personam Jurisdiction

Each state is free to prescribe its own statutory bases for personam jurisdiction. Of course, the exercise of jurisdiction a given case must also satisfy the constitutional requirements. Most states have statutes granting their courts in personam jurisdiction in the following 4 situations: 1. Where the defendant is present in the forum state and is personally served with process; 2. Where the defendant is domiciled in the forum state; 3. Where the defendant consents to jurisdiction; AND 4. Where the defendant has committed acts bringing him within the forum state's long arm statutes.

Statutory Limitations on In Personam Jurisdiction - State Law Exceptions to Traditional Rule

Even though jurisdiction through presence at the time of service has been upheld under the Constitution, state statutes and court decisions have limited the power of their courts in certain situations: 1. Service by Fraud or Force Invalid. If a plaintiff brings a defendant into a state by fraud or force to serve process, most courts will find service invalid. 2. Immunity of Parties and Witnesses. Most states likewise grant immunity from personal jurisdiction to nonresidents who are present in the state solely to take part in a judicial proceeding, or who are passing through the state on their way to a judicial proceeding elsewhere.

In Rem Jurisdiction - generally

Exists when the court has power to adjudicate the rights of all persons in the world with respect to a PARTICULAR ITEM of property. This jurisdiction is limited to situations where the property is located within the physical borders of the state and where it is necessary for the state to be able to bind all persons regarding the property's ownership and use. This occurs with respect to actions for condemnation (eminent domain), forfeiture of property to the state (e.g., when the property is used for the unlawful transportation of narcotics), and settlement of decedents' estates.

In Personam Jurisdiction - generally

Exists where the forum has power over the person of a particular defendant. (Jurisdiction over a plaintiff is generally not an issue because the plaintiff accedes to the court's jurisdiction by bringing the suit in that court). In these cases, the court may render a money judgment against the defendant or may order the defendant to perform acts or refrain from acting. Such a judgment creates a personal obligation on the defendants and is entitled to full faith and credit in all other states; i.e., if a defendants is ordered to pay a sum of money to a plaintiff, the plaintiff may enforce the judgment against the defendant's property in any other state where that property is located.

Federal Question Jurisdiction

Federal Question Jurisdiction is codified in section 1331. The principal problem in this area is to determine when an action "arises under" federal law. A secondary problem is to known what types of actions are within the exclusive jurisdiction of the federal courts under other specific statutes.

Diversity Jurisdiction - Citizenship of a Corporation

For diversity purposes, a corporation's citizenship is defined by 28 U.S.C. §1332. Under this statute, a corporation is deemed to be a citizen of EVERY state and foreign country in which it is INCORPORATED and the ONE state of foreign country in which is has is PRINCIPLE PLACE OF BUSINESS. The Supreme Court has held that a corporation's "principal place of business" is the state from which the corporation's HIGH LEVEL OFFICERS DIRECT, CONTROL, AND COORDINATE the corporation's activities ("NERVE CENTER"). Thus, many corporations have TWO CITIZENSHIPS. Although rare, it is also possible for a corporation to have more than two state citizenships because a corporation may be incorporated in more than one state. It is impossible, however, for a corporation to have more than one principal place of business. If an opposing party is a citizen of any of the corporate party's states of citizenship, there is no diversity. 1. Special Rule for Direct Actions. The rules of corporate citizenship are subject to a special rule in direct action cases. When a plaintiff sues an insurer on a policy or contract of liability insurance, and does not also join the insured, the insurer (whether incorporated or not) is treated as a citizen of all of the following: (i) the state or foreign country in which the insurer is incorporated; (ii) the state of foreign country in which the insurer has its principal place of business, and (iii) the state or foreign country of which the INSURED IS A CITIZEN. 2. Incorporation or Principal Place of Business in Foreign Country. Because a corporation is a citizen of both its place of incorporation and its principal place of business, and either of those places may be in a foreign country, a corporation might simultaneously be an alien and a citizen of a U.S. state. The fact that a corporation is an alien will defeat jurisdiction involving solely another alien, even though the corporation may also have U.S. citizenship.

Diversity Jurisdiction - Class Actions

If suit if brought by several named persons on behalf of a class under Rule 23, diversity is determined on the basis of the citizenship of the NAMED MEMBERS of the class who are suing. Thus, there is considerable room for maneuvering to create diversity if the class has members who are citizens of several different states. The Class Action Fairness Act also expands the federal court's jurisdiction over class actions.

In Personal Jurisdiction - Sufficient Contacts with Forum - 3. FAIRNESS

In addition to the defendant's having relevant contacts with the forum, International Shoe requires that the exercise of jurisdiction not offend "TRADITIONAL NOTIONS OF FAIR PLAY AND SUBSTANTIAL JUSTICE." The Court has listed several factors relevant to assessing whether jurisdiction would be fair. It is possible that an especially strong showing of fairness might make up for a lesser amount of contact (although minimum contacts are always required). 1. Convenience. A defendant will often complain that the forum is inconvenient. The Supreme Court has emphasized, however, that the Constitution does not require that the forum be the best of several alternatives. The forum is constitutionally acceptable unless it is "SO GRAVELY DIFFICULT AND INCONVENIENT THAT A PARTY IS UNFAIRLY PUT AT A SEVERE DISADVANTAGE IN COMPARISON TO HIS OPPONENT." This is a very difficult standard to meet, and the defendant usually will not be able to meet it simply by showing that the plaintiff has superior economic resources. 2. Forum State's Interest. The forum may have a legitimate interest in providing redress for its residents (Asahi Metal).

In Personam Jurisdiction - NOTICE

In addition to the requirement that the defendant have such minimum contacts with the forum to render the exercise of jurisdiction there fair and reasonable, due process also requires that a REASONABLE METHOD BE USED TO NOTIFY THE DEFENDANT OF A PENDING LAWSUIT so that she may have an opportunity to appear and be heard. Due process requires that notice be "REASONABLY CALCULATED, UNDER ALL THE CIRCUMSTANCES, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections." 1. Traditional Methods of Personal Service Satisfy DP Notice Requirements. Any of the traditional methods of personal service satisfy due process notice requirements. These include: (1). Personal delivery to the defendant; (2). leaving papers with a responsible person at the defendant's residence or place of business; (3). delivery to an agent appointment to accept service; OR (4). delivery by registered mail, return receipt requested. 2. Requirement that Agent Notify Defendant. If an agent is appointed by contract, in a case where the plaintiff chose the agent for his own benefit, or the agent is appointed by operation of law, the failure of the agent to notify the defendant will prohibit jurisdiction-since the defendant will in fact be deprived of an opportunity to be heard. (This is not true when defendant voluntarily selects his own agent, since any failure of the agent can be attributed to the principal.) 3. Requirements for Cases Involving Multiple Parties or Unknown Parties. In Mullane v. Central Hanover Bank, an action was brought against a number of trust beneficiaries scattered throughout the world. The Supreme Court held that the Constitution did not require personal service on each beneficiary since the cost would have been prohibitive. However, every beneficiary had to be notified in the BEST PRACTICAL MEANS AVAILABLE. Thus, those whose addresses were known or could reasonable be ascertained had to be notified by ordinary mail, while those whose names or addresses were unknown could be notified by publication. Such methods of notice are valid ONLY IF ALL defendants have substantially identical interests. 4. Knowledge that Notice by Mail Was Not Received. Although Mullane does not require actual notice, if a party known that the notice by mail was not received, he may not proceed in the face of such knowledge if practicable alternatives to apprise the defendant of the action exist.

In Rem Jurisdiction

In rem actions adjudicate rights of all persons with respect to property located in the state. An in rem judgment does not bind the parties personally, but is binding to the disposition of the property in the state. 1. Statutory Limitations. Most states have statutes providing for in rem jurisdiction in actions for condemnation, title registration, confiscation of property (vehicles used to transport narcotics), forfeiture of a vessel, distribution of the assets of an estate, and a grant of divorce when only the complaining spouse is present and subject to personal jurisdiction. In the last case, the "property" is the marital status of the complaint. 2. Constitutional Limitations. a. Nexus. In in rem actions the basis of jurisdiction is the presence of the property in the state. The state has a great interest in adjudicating the rights of all the world regarding this property. Therefore, the presence of the property in the state is constitutionally sufficient for the exercise of jurisdiction over the property. (i). No Jurisdiction If Property Not Located in State. A court has no jurisdiction over property located outside of the state; e.g., in settling a decedent's estate, the court has no in rem power over property in another jurisdiction. (ii). No Jurisdiction If Property Brought in by Fraud or Force. The exercise of in rem power is prohibited when the property is brought into the state by fraud or force. b. Notice. The early view held that attachment of property, when supplemented by publication of notice in a local newspaper or by posting of notice on the property, would give all interested persons sufficient notice of the action. However, such procedures are no longer adequate, and the requirements of Mullane apply to in rem actions. Thus, persons whose interests are affected and whose addresses are known must at least by notified by ordinary mail.

Limited (or Specific) Long Arm Statutes - Limitations in Property Actions

Many state statutes permit jurisdiction over a nonresident defendant when the cause of action arises from ownership of property within the state--as in the case of a tort action based on negligent maintenance of really or a contract action regarding the ale of the property. Some statutes include chattels, while other are confined to realty.

Limited (or Specific) Long Arm Statutes - Limitations in Contract Cases

Many statutes permit jurisdiction if the cause of action arises out of the "transaction of business" in the state. Some states require the defendant or his agent to have been physically present in the state at the time the transaction took place, but others have taken a broader view--e.g., New York has upheld jurisdiction over a California resident who made telephone bids from California on paintings being sold in New York.

Complete Diversity When Action Is Commenced. "Alienage" Jurisdiction

Most bar exam questions in this general area involve basic diversity of citizenship jurisdiction, in which the dispute involves "citizens of different states." However, §1332(a)(2) grants SMJ over "alienage" cases, in which the dispute is between a citizen of a U.S. state and an "alien"--foreign citizen. Jurisdiction is denied, however, if the case is between a citizen of a state and a citizen of a foreign country who has been admitted to the United States for permanent residence and domiciled in the same state as the U.S. citizen. Also note that the U.S. Constitution does not provide for federal jurisdiction over cases BY an alien AGAINST an alien; there must be a citizen of a U.S. state on one side of the unit to qualify for alienage jurisdiction.

Long Arm Statutes

Most states also grant their courts in personam jurisdiction over nonresidents who perform or cause to be performed certain acts within the state or who cause results within the state by or acts performed out of the state. In personam jurisdiction is granted regardless of whether the defendant is served within or outside the forum, but is limited to causes of action arising from the acts performed or results caused within the state.

Statutory Limitations on In Personam Jurisdiction - Physical Presence at Time of Personal Service

Most states grant their courts in personam jurisdiction over any defendant who can be served with process within the borders of the state, no matter how long he was present (i.e., even if merely passing through). The Supreme Court has upheld this type of jurisdiction, allowing a transient defendant to be served with process for a cause of action unrelated to his brief presence in the state.

Domicile

Most states grant their courts in personam jurisdiction over persons who are domiciliaries of the state, even when the defendant is not physically within the state when served with process. DEFINED. Domicile refers to the place where a person maintains her permanent home. If a person has legal capacity, her domicile is the place she has chosen through presence (even for a moment), couples with the intention to make that place her home. If a person lacks capacity, domicile is determined by law (e.g., infant is domiciliary of custodial parent's home state). CITIZENSHIP. A U.S. citizen, even though domiciled abroad, is subject to personal jurisdiction in the U.S.. The scope of this basis for jurisdiction is unclear, because states have never attempted to enact laws or rules enabling their courts to obtain jurisdiction solely on the basis of citizenship.

Limited (or Specific) Long Arm Statutes

Most states have long arm statutes that specify in detail the situations in which their courts can exercise jurisdiction.

Multiple Parties

Multiple party questions concern whether various types of joinder are permitted under federal law and, if so, whether there is a jurisdictional basis for a particular attempted joinder. The majority of the issues that arise in this area are grounded in the interpretation or application of statutes and the Federal Rules of Civil Procedure, and also require knowledge of subject matter jurisdictional bases, especially supplemental jurisdiction.

Diversity Jurisdiction - "Supplemental" Jurisdiction

Occasionally, a claim may be joined that could not, by itself, invoke federal question jurisdiction or diversity jurisdiction (because, for example, it is a state claim between parties who are citizens of the same state or because it does not involve the requisite amount in controversy. The federal court may nonetheless entertain such claims under its supplemental jurisdiction ("ancillary" jurisdiction). Supplemental jurisdiction requires that the supplemental claim arise from a common nucleus of operative fact as the claim that invoked original (diversity or federal question, usually) federal SMJ. Some courts consider the COMMON NUCLEUS TEST to mean that the claims must arise from the same transaction or occurrence, but the growing trend is that the common nucleus test is broader than that.

Constitutional Limitations on In Personam Jurisdiction - Sufficient Contacts with the Forum

Once it is determined that a state has a statute that allows the court to exercise in personal jurisdiction over the parties before it, the constitutionality of the exercise must next be determined. There are two components of the constitutional aspect: 1. contacts with the forum; and 2. notice. 1. Sufficient Contacts with the Forum. a. Traditional Rule: Physical Power. Traditionally, jurisdiction over a person (or res) was a consequence of the state's physical power to carry out its judgment; i.e., it was based on the power to arrest the person to force compliance with a judgment. Accordingly, the Supreme Court upheld exercises of jurisdiction whenever the defendant was served with process within the forum state (Penner v. Neff). The Court later expanded the states' physical power to extend not only to those defendants who were served within the state, but also to those defendants who consented to the state's power or who were domiciled in the state, regardless of where they were served. b. Modern Due Process Standard: Contact, Relatedness, and Fairness. The concept of power by which a state could enforce its judgments was greatly expanded by the Supreme Court in International Shoe Co.. No longer was power controlled solely by whether one of the traditional bases of presence, residence, or consent was present. Instead, the focus became whether sufficient minimum contacts exist between the defendant and the forum so that maintenance of the suit against the defendant does not offend "traditional notions of fair play and substantial justice." The Supreme Court has listed a series of factors by which to assess the constitutionality of personal jurisdiction. In general, the factors fall under three headings: contact, relatedness, and fairness.

In Personal Jurisdiction - Sufficient Contacts with the Forum - 2. RELATEDNESS OF CLAIM TO CONTACT

One important factor is whether the claim asserted against the defendant arises in some way from the defendant's contacts with the forum. If it does, the court is more likely to find that jurisdiction is fair and reasonable. This assessment requires the court to determine the nature and quality of the defendant's contacts with the state. Some authorities consider this factor to be part of the "contact" or the "fairness" assessment; others consider it, as we do here, to be part of the "relatedness" assessment. The important point is that you address the issue in your answer, whether under the contact, relatedness, or fairness prong of the analysis. 1. Claim Arising from Activity in the State (Specific Jurisdiction). If the defendant's in-state activity is less than systematic of continuous (isolated acts), in personam jurisdiction over the defendant will be proper ONLY for causes of action arising from THAT IN-STATE ACTIVITY; i.e., the court will have "specific jurisdiction." 2. "Essentially At Home" in the State (General Jurisdiction). General jurisdiction-in personam jurisdiction for ANY cause of action agains the defendant, whether the cause of action arose from the in-state activity or from activity outside the state-requires that a defendant is "essentially at home" in the forum. The Supreme Court has indicated that examples of places in which a defendant is "essentially at home" include the domicile of a person and the states of incorporation and principal place of business of a corporation. General jurisdiction cannot be based on purchases or sales alone; some physical presence is required. Furthermore, the inquiry is not whether the defendant engaged in systematic and continuous activity in the state, but rather whether that activity renders the defendant essentially at home in the state.

Quasi In Rem Jurisdiction

Quasi in rem jurisdiction permits a court without in personam jurisdiction to determine certain disputes between a plaintiff and a defendant regarding property when the property is located in the forum state. 1. Statutory Limitations. There are two types of quasi in rem jurisdiction: (i). Type I involves disputes between parties over their rights in property within the state; and (ii) Type II involves disputes UNREALTED to the in-state property and has been severely limited by the Supreme Court. In quasi in rem cases, the defendant has property in the state that the plaintiff attaches. The court then adjudicates the dispute between the parties on the basis of its power over the property. Since the court's sole basis of jurisdiction is the property, ANY JUDGMENT AGAINST THE DEFENDANT CAN BE SATISFIED ONLY OUT OF THAT PROPERTY. 2. Constitutional Limitations. a. Nexus. The Supreme Court held that the MINIMUM CONTACTS STANDARD is applicable to EVERY exercise of jurisdiction. The Court further found that the mere presence of property within a state is not itself sufficient to permit a court to exercise quasi in rem jurisdiction over property in a quasi in rem action. i. Quasi In Rem Type I. Thus, when the dispute involves the rights of the parties in the property itself, jurisdiction based upon the presence of the property in the state is proper. ii. Quasi In Rem Type II. When the dispute is unrelated to the ownership of the property, jurisdiction cannot be based solely on the presence of property in the forum state; there must be minimum contacts between the defendant and the forum. However, if the defendant has minimum contacts with the forum, it is also likely that a court could exercise in personam jurisdiction over a defendant under the forum's long arm statute, thus removing the limit on recovery to the defendant's in-state property. As a result, use of quasi in rem type II will be rare. iii. Procedural Requirements. To obtain quasi in rem jurisdiction, a plaintiff must "BRING THE ASSET BEFORE THE COURT" by ATTACHMENT (or garnishment). This will inhibit the sale or mortgage of the defendant's interest, since a new owner must take subject to the decision of court. Serious questions have been raised as to whether such a pretrial interference with a defendant's property rights is constitutional unless the defendant is afforded a hearing on the necessity of such procedures. Most commentators think the process is valid, but the Supreme Court has thus far avoided the issue. b. Notice. As in in rem cases, quasi in rem cases require the best practical notice. Therefore, posting of notice of notice by publication will be insufficient where the addresses of persons affected by the action are known or reasonable ascertainable. The federal statute for the enforcement of liens or other claims to real or personal property requires personal service if practicable and service by publication if personal service is not practicable. IF DEFENDANT IS NOT PERSONALLY SERVED, HE MAY APPEAR WITHIN 1 YEAR OF FINAL JUDGMENT, AND THE COURT MUST SET ASIDE THE JUDGMENT ON PAYMENT OF COSTS AS THE COURT DEEMS JUST.

Removal Jurisdiction

Removal jurisdiction allows defendants to remove an action brought in a state court to a federal court if the federal court would have had original jurisdiction over the action.

Subject Matter Jurisdiction

SMJ of the federal courts is limited to that authorized by the Constitution as implements by federal statute and decisional law. In general, it may be recognized as: diversity of citizenship jurisdiction; federal question jurisdiction; removal jurisdiction; or supplemental jurisdiction.

Constitutional Limitations on In Personal Jurisdiction - BLL BREAKDOWN

SUFFICIENT CONTACTS WITH THE FORUM - Modern DP Standard: Contact, Relatedness, and Fairness - International Shoe 1. CONTACT - "such minimum contacts" with the forum that exercise of jurisdiction is fair and reasonable. Consists of: (a). Purposeful Availment - purposefully availed herself "of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of its laws." Consider the "STEAM OF COMMERCE": 1. merely placing an item in the steam of commerce, by itself, is not a sufficient basis for PJ; 2. unresolved issue of whether lacing an item in the stream with knowledge or hope alone is sufficient - look for INTENTIONAL TARGETING; 3. placing an item in the stream coupled with some other act showing intent is a sufficient basis. Also consider the Internet Cases. (b) Foreseeability - defendant must "know or reasonably anticipate that her activities in the forum render it foreseeable that she may be haled into court there. 2. RELATEDNESS of Claim to Contact - "whether the claim asserted against defendant arises in some way from the defendant's contacts with the forum. a. Claim Arising from Activity in the State (Specific Jurisdiction) - if defendant's in-state activity is less than systematic or continuous, in personam jurisdiction over the defendant will be proper only for causes of action arising from that in-state activity (specific jurisdiction over that activity). b. "Essentially At Home" in the State (General Jurisdiction) - in personal for any cause were defendant is "essentially at home in the state." 3. FAIRNESS - the forum is constitutionally acceptable unless it is "so gravely difficult and inconvenient that a party is unfairly put at a severe disadvantage in comparison to his opponent" (Asahi Metal). 4. OTHER FACTORS: (i) plaintiff's interest in obtaining convenient and effective relief, (ii) the interstate judicial system's interest in obtaining the most efficient resolution of controversies, and (iii) the shared interest of the states in furthering fundamental substantive social policies. NOTICE - "Reasonably calculated under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to object." 1. Traditional Methods of Personal Service Satisfy DP Notice Requirements. These Include: (i). personal delivery to D; (ii) leaving papers with a responsible person at the defendant's residence of business; (iii) delivery to an appointment agent; or (iv) registered mail with return receipt requested. 2. Requirement that Agent Notify Defendant. 3. Cases Involving Multiple or Unknown Parties. Mullane v. Central Hanover Bank - may notify by publication if unknown, must used mail if address is known. Only valid is all defendants have substantially the same interests. 4. Knowledge that Notice by Mail Was Not Received.

Limited (or Specific) Long Arm Statutes - Limitations in Tort Cases

Some statutes permit jurisdiction when a "tort" occurs within the state, while other require a "tortious act." The latter language has caused problems where an out-of-state manufacturer puts his products into the stream of commerce knowing that some items will end up in the forum state. When the gravamen of the complaint is negligent manufacture, some courts have read "tortious act" narrowly and confined jurisdiction to the place of manufacture; others have read it to mean "the place the tort occurred," interpreting that to be the place of injury.

Statutory Limitations on Personal Jurisdiction

States have the power to decide over whom their courts may exercise jurisdiction. Therefore, the first place to look to determine whether the court has properly exercised personal jurisdiction usually is state law. If no statute grants the court power over the parties before the court, the court lacks personal jurisdiction.

Constitutional Limitations on Personal Jurisdiction

The Due Process Clause of the Constitution places two restrictions on the exercise of personal jurisdiction: 1. The defendant must have such contacts with the forum state that the exercise of jurisdiction would be fair and reasonable; 2. The defendant must be given appropriate notice of the action and an opportunity to be hears. Exercise of jurisdiction in violation of these constitutional requirements is not valid, even if a statute purports to grant the court jurisdiction.

In Personam Jurisdiction - Sufficient Contacts with the Forum - OTHER FACTORS

The Supreme Court has listed other factors relevant to the assessment of whether the exercise of jurisdiction would be fair and reasonable, but has not discussed these factors in detail: 1. the plaintiff's interest in obtaining convenient and effective relief, 2. the interstate judicial system's interest in obtaining the most efficient resolution of controversies, and 3. the shared interest of the state in furthering fundamental substantive policies.

Personal Jurisdiction

The ability of a court to exercise power over a particular defendant or item of property. The primary limitations on a court's power to exercise personal jurisdiction are found in the United States Constitution and in state statutes. Three Types of Personal Jurisdiction: 1. In Personam Jurisdiction; 2. In Rem Jurisdiction; and 3. Quasi in Rem Jurisdiction

Diversity Jurisdiction - Domicile

The determination of the state of citizenship of a natural person depends on the permanent home to which he intends to return. The concept is the same, except in name, as domicile. A new state citizenship may be established by: 1. PHYSICAL PRESENCE in a new place, AND 2. THE INTENTION TO REMAIN THERE. In most cases, the citizenship of a party will be determined by the court, but it may be left to the jury.

Supplemental Jurisdiction

The doctrine of supplemental jurisdiction is codified under section 1367 and includes, under a single name, the concepts of "ancillary" and "pendent" jurisdiction. In any form, supplemental jurisdiction allows a federal court to entertain certain claims over which it would have no independent basis of SMJ, i.e., claims that do not satisfy diversity or federal question jurisdiction requirements. It is important to note that supplemental jurisdiction operates only after a claim has invoked federal SMJ, after the case is properly in federal court. Supplemental jurisdiction operates to bring additional claims into the case that arise from the same transaction or occurrence as the original claim, but it cannot be used to get the case into federal court in the first instance.

Limitations on Personal Jurisdiction

The exercise of personal jurisdiction generally must be authorized by statute AND constitutional.

Collusion and Devices to Create or Defeat Diversity

The federal court does not have jurisdiction if a party "by assignment or otherwise, has been improperly or collusively made or joined to invoke jurisdiction." 1. Assignment of Claims. The assignment of a claim to another party for collection only is clearly within this section. Thus, the assignment would be ignored in determining whether diversity exists. But note: There is no collusion if an absolute assignment of a claim is made and the assignor retains no interest in the assigned claim. 2. Class Actions. No rule prevents achieving diversity by the adroit selection of named plaintiffs to bring a proper class action on behalf of others. The naming of only members of the class who are not co-citizens of the defendants will create diversity even though other unnamed members of the class are co-citizens who would defeat diversity if named. 3. Voluntary Change of State Citizenship. A plaintiff can create diversity by changing his state citizenship after the cause of action accrued but before suit is commenced, but the change must be genuine. In other words, a true change of citizenship can create or destroy diversity. the party's MOTIVE for changing citizenship is IRRELEVANT.

Personal Jurisdiction in Federal Courts

The main jurisdictional problem in state courts arises when the defendant over whom power is sought lives in another state. Since the federal borders encompass all states, one might expect that federal courts would encounter problems of personal jurisdiction only when'd defendants were foreign nationals. However, Rule 4 of the Federal Rules provides that, absent some special federal statute, each federal court must analyze personal jurisdiction AS IF IT WERE A COURT OF THE STATE IN WHICH IT IS LOCATED. Thus, in most cases, the assessment of whether the court has personal jurisdiction over the defendant will be exactly the same in federal court as it is in state court. Rule 4 also authorizes jurisdiction without regard to state long arm statutes over third-party defendants and parties required to be joined under the compulsory joinder rules, provided the party is served within 100 miles from the place where the summons was issued.

Diversity Jurisdiction - Business Trusts

The trustees of a business trust are the real parties in interest and their citizenship, not that of the individual shareholders, determines whether there is diversity.

Personal Jurisdiction - Overview

There are two branches of jurisdiction: SMJ and PJ. SMJ involves the court's power over a particular type of case. Personal jurisdiction involves the ability of a court having SMJ to exercise power over a particular defendant or item of property.

Quasi In Rem Jurisdiction - generally

Two types: 1. One type of quasi in rem jurisdiction exists when the court has the power to determine whether particular individuals own specific property within the court's control. Unlike in rem jurisdiction, however, it does not permit the court to determine the rights of all persons in the world with respect to the property. 2. A second type of quasi in rem jurisdiction permits the court to adjudicate disputes other than ownership based on the presence of the defendant's property in the forum. DEFENDANT IS NOT BOUND PERSONALLY. The basis of a court's power to exercise quasi in rem jurisdiction is the property within the state. The judgment does not bind the defendant personally and cannot be enforced against any other property belonging to the defendant.

Venue

Venue will depend on where the cause of action arose and on the nature of the parties (i.e., whether corporate or natural persons).

Consent

Virtually every state provides for in personam jurisdiction through a defendant's consent. Such consent may be express or implied or through the making of a general appearance.

Implied Consent

When the state has substantial reason to regulate the in-state activity of a nonresident of the state, it may provide that be engaging in such activity, the nonresident thereby appoints a designated state official as his agent for service of process. Thus, for example, the Supreme Court has upheld statutes that use such implied consent to subject a nonresident motorist to jurisdiction in any state in which he has an accident.

Interpleader Exception to Complete Diversity

a. Federal Interpleader Statute--Minimal Diversity. The federal interpleader statute 28 U.S.C. §1335, requires only that among the parties there be "TWO OR MORE ADVERSE CLAIMANTS, OF DIVERSE CITIZENSHIP." Thus, "minimal diversity" is sufficient to confer jurisdiction under the statute. If there is diversity between ANY TWO of the claimants, all other claimants may be citizens of the same state. (Also, §1335 requires that money or property at issue be valued at $500 or more.) b. Interpleader Under Federal Rules--Complete Diversity. Interpleader pursuant to Rule 22 of the Federal Rules, on the other hand, requires the usual diversity between all the plaintiffs (stakeholders) and all the defendants (claimants).