Prior to commencing a lawsuit, research must be done to ascertain who should be made Parties to the lawsuit and which court has jurisdiction over the lawsuit. Before beginning the exercises, review the specific objectives for this chapter of the text.
· Who may be a party to a lawsuit
· How to identify the subject matter jurisdiction of federal courts
· When a defendant may remove an action from state court to federal court
· When a party may be compelled to defend an action in a particular court
· What the differences are between federal and state court jurisdiction
· How to determine in which court to file a lawsuit
TESTING YOUR COMPREHENSION
Test your comprehension of Chapter 4 by answering each of the following questions. Circle true or false for each answer. Although the answers may be found in the main text, try to answer each question before referring to the test.
1. T F Parties to an action may be individuals as well as entities such as partnerships and corporations.
2. T F When naming a partnership as a party to a lawsuit, do not name the individual partners as parties.
3. T F When naming a corporation as a party to a lawsuit, you
should name the individual shareholders as parties to the lawsuit.
4. T F The plaintiff to the action must be the real party in interest.
5. T F An assignee is never the real party in interest in a lawsuit.
6. T F Subrogation occurs when one party becomes obligated to pay for the loss sustained by another.
7. T F A lawsuit must be brought by and against parties that have a legal capacity to sue or defend the action.
8. T F A plaintiff should join any party in the litigation if that party's presence is required to grant complete relief.
9. T F Rule 20 of the Federal Rules of Civil Procedure permits the joinder of parties whenever there is a legal or factual relationship between the parties, making it sensible to have all the parties present in one lawsuit.
10. T F Because the permissive joinder rules may cause delay in the litigation and be unfairly expensive and burdensome on certain parties, a court has broad powers to order separate trials.
11. T F Joinder of claims is always mandatory and never permissive.
12. T F Subject matter jurisdiction refers to the power of a court to hear
13. T F Federal district courts are courts of unlimited jurisdiction.
14. T F The basis for federal court jurisdiction must appear on the ace of a wellpleaded complaint.
15. T F Because federal courts may render advisory opinions, the court may even hear cases that are moot.
16. T F Federal district courts have original jurisdiction of all civil actions arising under the constitution, laws, or treaties of the United States.
17. T F The United States cannot be sued as a party unless it has waived its sovereign immunity.
18. T F If the federal district court does not have federal question jurisdiction, then the lawsuit must be filed in state court.
19. T F Domicile refers to the permanent residence of natural persons.
20. T F In order to invoke the federal court's diversity jurisdiction, one requirement is that the amount in controversy must exceed $50,000.
21. T F If a federal court has jurisdiction over the plaintiff's claim, the defendant may not file a counterclaim against the plaintiff unless the defendant's claim also has a basis for federal court jurisdiction.
22. T F Personal jurisdiction refers to the power of a court to bring a party.
23. T F If a court has subject matter jurisdiction, it does not need personal jurisdiction over the defendant.
24. T F Due process issues do not arise for plaintiffs since by initiating suit a plaintiff is considered to have voluntarily submitted to the court's jurisdiction.
25. T F Venue refers to the geographical district in which a lawsuit may be heard.
APPLYING YOUR KNOWLEDGE
Answer the following questions by applying the information you have learned from the main text. If you need more space for some of the questions use a separate sheet of paper.
1. Why may a legal entity be a party to a lawsuit without also naming an individual as a party? Are there times when you would want to name both the legal entity and an individual who is the owner of the legal entity as parties to a lawsuit? Identify a situation where you may want to name both the individual owner and the legal entity as parties.
2. Why do you need to determine the identity of the real party in interest before filing a lawsuit? How would you go about finding the identity of the real party in issue?
3. What are some of the issues which should be considered in determining whether a party should be joined in a lawsuit? What are the purposes of taking into account such issues? What should a court do if a party who should be joined in the lawsuit cannot be joined for some reason?
4. What is the meaning of limited jurisdiction in federal court? Are there any limits of jurisdiction for the trial courts in your state? What are those limits?
5. What actions does a federal court have original jurisdiction over? What does it mean to say that a federal court has original jurisdiction? Is original jurisdiction always required in federal court?
6. What is the difference between general and specific jurisdiction? Why is the distinction important?
7. Why must the United States waive its sovereign immunity before a lawsuit can be filed against it? What grounds can be used by the plaintiff to bring a lawsuit against the United States?
8. What are the different categories of actions for which diversity jurisdiction is proper? Give an example of each.
9. Why can domestic relations and probate matters only be raised in state courts and not in federal district courts? Are there some policy goals which are better fostered by having these matters heard in state court?
10. Actions filed in state court may be removed by a defendant to federal court within the 30 day period from the time the defendant had notice of the plaintiff's initial pleading. If an action could properly be brought in federal court, why is there any time limit within which a defendant must remove the action? If the plaintiff merely gave the defendant a copy of the state court pleading, but did not properly serve the defendant with the pleading, does the 30 day period still apply?
11. Why is it important for the court to have personal jurisdiction over the defendant? How does personal jurisdiction differ from subject matter jurisdiction?
12. In International Shoe Co. v. State of Washington, 326 U.S. 31 (1945), the Court held that where a corporation's "minimum contacts" in the forum state were such that being forced to defend a suit in that state would not offend "traditional notions of fair play and substantial justice," jurisdiction was proper. What do you think the Court meant by "minimum contacts"? Why is the Court concerned about there being sufficient minimum contacts?
PROJECTS FOR RESEARCH AND WRITING
Each of the following projects requires you to prepare documents from the information you have learned in the main text. In some instances, you will also need to conduct some basic legal research. Once you have finished each of the projects, place the projects in your litigation guide for future reference.
1. If the plaintiff wishes to file an action in federal district court, and there is not federal question jurisdiction, then the lawsuit may still be brought in federal court so long as there is diversity jurisdiction. On the top of a separate piece of paper, identify the three requirements for diversity jurisdiction. Under each requirement, list the specific elements of each requirement.
2. A defendant must have sufficient contacts with a state in order for the state to be able to exercise its jurisdiction over the defendant. Identify on a separate sheet of paper the contacts a defendant might have with a state which you believe may satisfy a minimum contacts analysis. You should attempt to brainstorm and come up with as many different contacts as you can. Be prepared to discuss these contacts in class.
3. As indicated in the main text, the federal district court is the trial court in the federal court system. Identify the trial court(s) in your state court system and the subject matter jurisdiction you must have for each. Be sure to identify all county, municipal, justiceofthepeace, and small claims courts. Place your work in your litigation guide.
4. Special pleading rules govern certain types of actions and regulate whether parties can be joined in a lawsuit. The Federal Rules of Civil Procedure identified at page 99 of the main text indicate where you may find the various pleading rules for particular types of actions. Fill in the chart on the following page by referring to the rules of civil procedure for your state. If your state does not have a specific rule, write in "not applicable." At this point, you do not need to worry about the meaning of each of these terms. The pleadings and their requirements are discussed in Chapter 5 of the main text.
ACTION FEDERAL RULES STATE RULES
Counterclaims Rule 13
Crossclaims Rule 13
Impleader Rule 14
Interpleader Rule 22
Intervention Rule 24
Class actions Rule 23
derivative suits Rule 23.1
5. For each of the following situations, state whether you believe the defendant has sufficient minimum contacts with the state to allow the state to exercise personal jurisdiction over the defendant. Be prepared to justify your answers.
a. Defendant lives in California. While on vacation in Wyoming, Defendant was involved in an automobile accident with Plaintiff. Plaintiff resides in Utah. Defendant has never been to Utah, nor does Plaintiff do any business in Utah. Defendant had been to Wyoming only one other time, approximately five years ago. Can a court in Wyoming exercise jurisdiction over the Defendant? Can a court in Utah? Can a court in California?
b. Plaintiff runs a mailorder greeting card business in Iowa. Plaintiff sent a catalogue to Defendant in the mail. Defendant, a resident of New Jersey, after receiving the catalogue placed an order with Plaintiff over the telephone. This was the first time that Defendant ever placed an order with Plaintiff, although Plaintiff previously had sent Defendant catalogues. Plaintiff shipped Defendant the cards, but Defendant has refused to pay. Can a court in Iowa exercise jurisdiction over Defendant? Can a court in New Jersey?
c. Defendant was on a business trip from Seattle, Washington to Orlando, Florida. While en route, the airplane on which Defendant was traveling made a scheduled stop in Dallas, Texas. Defendant, wanting to buy a newspaper at the Dallas airport before the flight resumed, stepped off the plane. He was immediately served with a summons and complaint requesting that he appear and defend an action in Dallas, Texas. The complaint was for breach of contract, based upon a contract that was entered into in Washington. Plaintiff was residing in Washington at the time the contract was entered into but has since moved to Dallas, Texas. Does the court in Texas have jurisdiction over the Defendant?
d. Defendant is a corporation that sells hair dryers. Defendant's principal place of business is Massachusetts and it is incorporated in Delaware. Defendant ships its hair dyers to ten regional distributor's who thereafter ship the hair dryers to retail outlets within each distributors region. Plaintiff purchased a hair dryer at a retail outlet in Omaha, Nebraska. The hair dryer had been shipped from the regional distributor in Memphis, Tennessee. Plaintiff was injured by the hair dryer when the hair dryer malfunctioned. Can a court in Nebraska exercise jurisdiction over the Defendant? Can a court in Tennessee? Can a court in Massachusetts? Can a court in Delaware?
6. For each of the following exercises, determine whether the jurisdictional amount requirement of $75,000 is met, thereby allowing the plaintiff to file the action in federal district court.
a. Plaintiff has one claim against one defendant for $70,000 in principal and $5,100 in interest.
b. Plaintiff has two claims against one defendant. One claim is for $60,000 and one claim is for $20,000.
c. Plaintiff has two claims against two defendants. The claims are two separate unrelated contracts. One claim is for $35,000, and one claim is for $45,000.
d. Plaintiff has two claims against three defendants. The claims all relate to the obligations of a partnership in which the defendants are all general partners. Each claim is for $30,000.
e. Two plaintiffs have a claim against one defendant based upon two separate contracts. Each plaintiff has a claim for $60,000 against the defendant.
7. Whenever you draft a complaint, you must be certain that you have named all proper and necessary parties. On a separate sheet of paper, make a checklist for yourself of the questions you must answer to determine whether you have the proper parties and whether additional parties are appropriate or necessary. Place the checklist in your binder for each reference when you begin drafting complaints.
8. At page 102 of the main text, you learned that several sections of Title 28 of the United States Code provide for specific grants of federal court jurisdiction. State courts also often have specific grants of jurisdiction, requiring that certain actions be brought in particular courts. Review the rules of civil procedure for your state. Are there any specific grants of jurisdiction for the courts in your state? If so, identify the rule number and the type of jurisdiction, and place the information in your binder for future reference.