Download Subject Matter Jurisdiction and Litigation Process in US Courts - Prof. Richard Schuster and more Study notes Law in PDF only on Docsity!
Test 1 Material Aug- ● Point of class is to learn laws, but memorize cases ● Litigation - Should not be first course of action ○ Process helps the business community resolve actual disputes ○ Effective business leaders should develop an understanding of the process ○ Any lawsuit is an immense drain of time, money, and energy on everyone involved (Except the lawyer! They get paid quite well for these things!) ■ Communicate first!!! Don’t go to court unless you really have to. ● Parties ○ Plaintiff: Party who files a civil action - Person suing ■ Plaintiff - going to court for civil charges ■ Prosecutor - going to court for criminal charges ○ Defendant : Party sued by the plaintiff or person against whom a criminal charge is filed by state - Person being sued ○ Third-party defendant : Parties brought in by the defendant to complete the determination of a controversy ■ People getting roped in to be sued correctly ○ Situation: Customer gets sick from bacon taco bought from Taco Company. They(Customer) sue. Taco Company brings Bacon Company into court as well, to make sure they(Bacon Company) are correctly sued. ■ Customer - Plaintiff ■ Taco Company - Defendant ■ Bacon Company - Third-party Defendant ● Potential Remedies ○ Remedies – equitable and legal ■ Legal - What you want and are suing for. Money. ■ Equitable - preventing the incident from happening again. Orders. ● If not followed, can be held in contempt of court. ○ Status of federal and state courts today ○ General Rule: Equitable orders aren’t given where damages will suffice. Why? ■ Court orders are dependent on the people cooperating properly and ○ How do these courts decide how to rule? Should they be consistent or arbitrary? ■ Case-by-case basis ■ Be consistent based on precedent ● State & Federal Courts ○ State & federal laws are distinct. ○ State & federal courts are distinct. ○ State courts ■ Judges may be elected or appointed ● Concerns with elections(lobbying) ○ Impropriety ○ Fear of impropriety
■ May have a variety of trial courts (e.g., small claims court, etc.) ○ ○ Federal courts ■ Judges are usually appointed by president ■ At least one federal court in all states ● Types of Courts ○ Trial courts ■ Usually have general jurisdiction ● The court in law shows ■ Commonly called “district courts” ■ Used to: ● 1. determine facts ○ Evidence and witnesses to determine a truth ● 2. apply law ○ Should it be necessary ○ Appellate courts ■ Only hear appeals (and will hear any appeal) ● When you don’t like the ruling done in a trial court ■ Commonly called “circuit courts” ■ Used primarily to review whether the law was applied/interpreted correctly ● No jury and no new evidence given ● Just a review of the court transcript to review the decision and make a new announcement, if needed. ○ Supreme Court of the United States ■ 9 Justices – appointed for life by president with Senate’s approval ■ Discretionary review – writs of certiorari & the rule of four. ● It is at their discretion that they hear the appeal or not. ● Writs of certiorari - written note of appeal ● Rule of Fou r - should 4 justices wish to hear the case, then they shall
Aug- ● Jurisdiction ○ Jurisdiction - A Court’s power to enter a judgment against property or person. ■ Personal jurisdiction – Does the court have the right to force a person to attend a trial? ● Can a U.S. court make 2 Canadians come to court? ○ No ■ Subject matter jurisdiction – Can the court settle disputes of this type? ● Can a federal court hear a state law dispute? ○ Yes, but not the opposite way around ● Personal Jurisdiction ○ Several ways to establish personal jurisdiction: ■ Consent ● When the person in question readily agrees to attend the trial with consent ■ In personam – does the person live in the jurisdiction (state)? ● Does a company have an office there? ● Like flying to sue them in their place of residence. ● Or if they have a business “presence” in your state. ■ Out of state parties – do they have minimum contacts? ● Q: Is it fair to force a party to come to a court in the state? Have they “purposefully avail[ed] himself of the resources of that state?” ● Pres-Kap v. Sys. One (Fla. App. 1994) ○ System One – Owns and operates a computerized reservation system with servers located in Florida. They have a sales office in New York. ○ Pres-Kap – Travel agency located solely in New York. ○ Facts – System One solicited and secured Pres-Kap’s business (running its online reservations) in New York. The system broke, Pres-Kap stopped paying, and System One is now suing for breach of contract in Florida. ○ Q: Does the court have personal jurisdiction? ■ Consent ■ In personam – does the person live in the jurisdiction (state)? ● Does a company have an office there? ■ Out of state parties – do they have minimum contacts? ● Q: Is it fair to force a party to come to a court in the state? Has he “purposefully avail[ed] himself of the resources of that state?” ○ Holding: Remote usage of server physically located in a forum state is insufficient to establish minimum contacts. ■ What can System One do? ■ Where can they file? Does that court have personal jurisdiction over both parties? ● Subject Matter Jurisdiction ○ Subject matter jurisdiction – court’s authority on a particular type of case ○ General vs. Limited
■ Limited – can only hear specific types of cases (bankruptcy, probate, etc.) ■ General – can hear a broad variety of cases ● Exclusive v. Concurrent ○ Parties cannot waive subject matter jurisdiction problems. ○ Subject matter jurisdiction considerations: ■ Subject matter of the lawsuit ■ Sum in controversy ■ Is a criminal case a felony or a misdemeanor? ■ Is this an appeal? ○ Examples: Court of Criminal Appeals, Court of Tax Review, Small Claims Court, Drug Court, etc. ○ State – depends on the state ○ Federal: ■ Federal Question – e.g., patent infringement ● When suing for federal government-level things ■ Diversity ● Amount in controversy exceeds $75,000,and ● Parties are citizens of different states or country ● Why do we have this rule? ● State court and removal ○ Diversity Jurisdiction Hypos: ■ A citizen of Pennsylvania is suing a citizen of Minnesota and claiming $76,000 in damages? ■ A citizen of Pennsylvania sues a citizen of Texas and a citizen of New York in the same suit. ■ Complete Diversity? - A citizen of Pennsylvania sues a citizen of Texas and a citizen of Pennsylvania in the same suit. ○ • Diversity Jurisdiction Hypos: ■ A citizen of Pennsylvania is suing a company incorporated in Texas. ■ A citizen of Pennsylvania is suing a company with a principal place of business in Texas. ● Does it matter if the defendant from Texas has a sales office (one of many) in Pennsylvania? ○ • Exclusive State Jurisdiction – family matters (e.g., divorce and adoption) and state crimes ○ • Exclusive Federal Jurisdiction – federal crimes, bankruptcy, patents and copyrights, cases against the U.S. ○ • Concurrent jurisdiction – everything else
● Ask: is it possible for them to win? ● Example: Plaintiff alleges that you were negligent, but not that you caused any harm. ● Scope of Discovery ○ Discovery – Why do we have this? ○ Discovery procedures are intended to be used freely by parties without court’s supervision ○ Judges provide a liberal interpretation of the degree of discoverable information ● Pretrial: Discovery ○ • Types of Discover: ■ Requests for admission ● Statements for witness to admit or deny ■ Interrogatories ● Questions ■ Depositions ● Live action questions out of courthouse ■ Requests for documents, objects, and entry upon land ■ Requests for examination ● Abuse of Discovery ○ Discovery imposes a tremendous burden on the judicial system ○ Aggression during discovery on the part of any party can damage the litigation process ○ Defendant should be open and responsive to reasonable requests of the plaintiff (and vice-versa)
Sep- ● Pretrial: Discovery ○ E-Discovery – computer files are discoverable and include metadata ■ Benefits? Drawbacks? ○ Spoliation – destroying or failing to preserve evidence ■ Document hold letters ■ Document retention policies ● Brookshire Bros v. Aldridge (TX 2014) ○ Facts: Aldridge slipped on grease that had leaked out of a chicken container. It was caught on tape, which the store routinely deletes after 30 days. He went to the doctor and told the store about the fall 5 days later. They initially paid his medical bills, but then stopped. He sued 2 months later. The store kept 8 minutes of video, starting about 30 seconds before the fall. ■ Which means court cannot tell how long the grease had been sitting there ○ Aldridge alleged injuries from his fall and sought damages under a premises-liability theory. To recover, he had to show defendant knew or should have known of the dangerous condition. ○ Rule: Party must keep evidence when it knows or reasonably should know that there is a substantial chance that a claim will be filed and that evidence is relevant. ○ Q: Should the videos have been kept? Why or why not? ■ Yes, as to prevent having to pay further damages ○ Held: The store knew it was likely to be sued and that the tape was relevant. It should have kept the evidence. ○ Possible remedies include: ■ Strike pleadings ■ Evidentiary instructions (negative inference) ■ Damages ● Pleadings ○ Motion for summary judgment (MSJ) ■ Ask: is it possible for them to win? ■ Facts are viewed in the light most favorable to the other party. ■ Example: Plaintiff alleges you were negligent and his car was damaged, but he has shown no proof. ● Pretrial: The Jury ○ Jury Trial ■ Constitution – “where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved” ● Must request jury ■ Voir Dire ● Jury selection ● Judge will access for bias in jury ■ Jurors can be dismissed peremptorily (no reason) or for cause (bias). ■ 6-12 members
■ Modify ● Enforcing a Judgment ○ Q: How does a successful plaintiff get paid after the court finds for them? ■ Defendant just pays, or ■ Parties settle, or ■ Writ of execution ● Add Chapter 4 Review Pages ● Review ○ Remedies: Legal and Equitable ○ State v. Federal Courts ○ District (Trial), Circuit (Appellate), and Supreme Courts ○ Stare Decisis & precedent ○ Rule of law ○ Standing - Who can bring a lawsuit? Must show: harm, causation, and possible remedy ○ Jurisdiction - a court’s power to enter a judgment against property or person ○ Personal jurisdiction – Does the court have the right to force a person to attend a trial? ○ Subject matter jurisdiction – Can the court settle disputes of this type? ○ Several ways to establish personal jurisdiction ■ Consent ■ In personam ■ Out of state parties - Minimum contacts? ○ Subject matter jurisdiction ■ General v. limited ■ Considerations: subject, amount, felony/misdemeanor, appeal? ■ State v. federal court ○ Federal Question – e.g., patent infringement, or ○ Diversity ■ Amount in controversy exceeds $75,000, and ■ Parties are citizens of different states or country ■ State court and removal ○ Adversarial system of law ○ All law are: Civil or Criminal & Substantive or Procedural ○ Laws vary from state to state to federal court ○ Stages of litigation: pre-trial, trial, and post-trial ○ Burden of proof: reasonable doubt and preponderance of the evidence ○ Attorney fee structure: fixed, hourly, or contingent ○ Pleadings ■ Complaint – allegations, jurisdiction, prayer ■ Answer – admit/deny, affirmative defenses, counterclaims ○ Motions – e.g., Motion to dismiss, motion on the pleadings, motion for summary judgment, etc.
○ Discovery – Requests for admission, interrogatories, depositions, requests for things, and requests for examination ○ Spoliation ○ Types of Discover: ■ Requests for admission ■ Interrogatories ■ Depositions ■ • Requests for documents, objects, and entry upon land ■ • Requests for examination ○ Jury – voir dire, removing potential jurors, and unanimous verdicts ○ Rules of evidence – relevance, motions in limine, and hearsay ○ Opening & closing statements ○ Witnesses – direct and cross ○ Burdens of Proof – preponderance and reasonable doubt ○ Appeals ○ Enforcing judgments ● Overview of Common Law Contracts ○ Sources of Contract Law ■ State law ■ Common law for all contracts except sales and leases of goods ■ Sale and lease of goods contracts – Statute(Uniform Commercial Code) ○ Function of Contract Law ■ Provides stability and predictability for commerce by enforcing promises ■ Why is this important? ■ Small groups and the necessity of contracts? ○ Definition of a Contract: ■ Mutual promises for breach of which the law provides a remedy ● Promisor & promisee ■ Available remedies? – damages or obligation to fulfill promise ● Money is best
● Defenses to Contract Enforcement ○ Defenses to Enforceability: ■ Voluntary Consent? ● Did you intend to sign the contract? Did you want to sign? ● Fraud, undue influence, mistake, duress? ■ Form - Some contracts must be written. ● Examples – Contract for more than 1 year or for sale of land. ● Contracts – Unilateral v. Bilateral ○ Bilateral – both parties promise to do something ○ Unilateral – one party promises to do something after the other actually performs (promise for an act). ■ Offers are usually revocable. But things are a bit different for unilateral offers. Has substantial performance started? ■ Some form of action has to be provided ● Contracts – Express v. Implied ○ Q: Did the parties specifically agree to a contract? ■ Express: Words (oral or written) stating that a contract is being formed. ■ Implied: Conduct creates and defines the terms of the contract. Requirements: ● • Plaintiff furnished good or service. ● • Plaintiff expected to be paid. ● • Defendant had a chance to reject and did not. ● Implied Contract Hypo ○ Q: Guy walks into tax preparer’s office and asks about services and rates. He leaves, saying “I need to think about it.” He returns later, and leaves a box of tax documents with the receptionist, saying “give these to the tax guy.” Is there a contract? Express? Implied? When? Implied contract requirements: ■ Plaintiff furnished good or service. ■ Plaintiff expected to be paid. ■ Defendant had chance to reject and did not. ● Types of Contracts ○ Terms – can be express or implied and one contract can have both. An express contract can have implied terms. ○ Performance – executed or executory? Have both parties done what was promised? ■ Example: You promise to mow my lawn for $30. I’ve paid you, but my lawns hasn’t been mowed. Executed or executory? ○ Contract Enforceability ■ Enforceable – satisfy all requirements ■ Voidable – satisfy all requirements, but can be voided due to some legal issue ● Like if one of the contractors is a minor ■ Void – there was never a contract and so there is nothing to enforce ● Like selling cocaine
● Interpretation of Contracts ○ Q: How do we interpret a contract? ■ Example: “I’ll sell you my car for $5,000.” ■ Different possible rules in different states. ● Like the type of car ○ Ambiguity – the contract isn’t clear on something ■ Can we bring in evidence to prove what the parties actually meant? ○ Potential Ambiguities: ■ Parties’ intent can’t be determined from contract’s language. ■ Contract lacks a provision on a disputed term. ■ Multiple possible interpretations or uncertainty. ○ “Plain Meaning” Rule: ■ No “extrinsic” (external) evidence if meaning of contract terms are unambiguous. ■ Q: When you read the contract, does it seem clear? ■ If terms are ambiguous, court may admit “extrinsic” (external) evidence. ○ Other Rules of Interpretation ■ Contracts are interpreted as a whole. ■ Terms that are negotiated separately given greater weight. ■ Words given ordinary, common meaning. ■ Specific wording given greater weight than general language. ■ Written or typewritten given greater weight than preprinted. ■ Ambiguous terms interpreted against the ■ drafter. ● Agreements ○ An agreement is necessary to form a contract. ■ The parties must agree to the terms of a contract ■ Containing an offer and acceptance ■ The agreement does not necessarily have to be in writing ○ The law follows the “objective theory of contracts” ○ ALL CONTRACTS MUST HAVE AN OFFER AND ACCEPTANCE ● Offer ○ An offer is a promise or commitment to do or refrain from doing some specified action in the future. ■ The offeror must have a serious intention to become bound by the offer ■ The terms of the offer must be reasonably certain or definite, so that the parties and the court can ascertain the terms of the contract ■ The offer must be communicated to the offeree ○ The test of an offer: when the offeree may assent to the offeror’s terms and a contract is formed. ○ Not offers ■ Expressions of Opinion: “I can likely have your car up and running for $250”
Sep- ● Leonard v. Pepsico (S.D.N.Y. 1999) ○ Facts: Leonard did not collect 7,000,000 Pepsi Points, but instead sent a check for $700,008.50 as permitted by the contest rules. Leonard had 15 existing points, paid $0.10 a point for the remaining 6,999,985 points, and a $10 shipping fee. The plane was valued at over $30M. ○ Q: Was this a unilateral or bilateral offer? ○ Q: Was this an offer at all? ○ Rule: A reasonable person must believe an offer was serious for it to lead to a contract. ○ Court – “No reasonable person could have believed that the company seriously intended to convey a jet worth roughly $23 million for $700,000, i.e., that it was mere puffery.” ○ The non-serious nature of the “offer” is emphasized by the kid taking it to school. ○ The ad continued, but with a price of 700 million points. ● Termination of the Offer ○ An offer can be terminated in any of several ways: ■ Revocation by offeror ● Express repudiation of the offer ● Performance of acts that are inconsistent with the existence of the offer and are made known to the offeree ■ Unreasonable amount of time passes ■ Rejection by offeree ● Once rejected, an offeree may NOT accept the offer. Any attempt to accept a rejected offer is treated like a counteroffer ○ An offer can be terminated in any of three ways: ■ Counteroffer by offeree ● A counteroffer is a REJECTION of the original offer and the simultaneous making of a new offer. ● Mirror Image rule: An acceptance must be a MIRROR image, varying no terms, of the original offer to accept it. ○ Irrevocable offers: ■ Option Contract: when a person pays value to keep a contract open (consideration) ● Gyabaah v. Rivlab Transportation ○ Facts: Adwoa Gyabaah was hit by a bus owned by Rivlab Transportation. Ms. Gyabaah retained an attorney to negotiate a settlement, agreeing to a contingency fee of 1/3. ○ The bus company offered a $1M offer to which Ms. Gyabaah told her attorney she would accept. This agreement was never communicated to the Bus Company. Her attorney never accepted the offer. ○ Soon after, Ms. Gyabaah retained another lawyer who advised her earlier attorney that Ms. Gyabaah did not wish to settle the lawsuit yet. Her earlier attorney sued Ms. Gyabaah to enforce the agreement and contingency fee.
○ Issue: Was there an offer and acceptance to an enforceable contract? ■ What contract was/was not formed? ○ Neglecting to communicate an accept to the defendant is “fatal to [her first attorney’s] claim of a settlement” ○ • “It is essential in any bilateral contract that the fact of acceptance be communicated to the offeror. Therefore, this action was not settled because the executed release was never forwarded to the defendant now was acceptance of the offer otherwise communicated.” ○ • Rule: An acceptance must be communicated to the offeror. ● Acceptance ○ Acceptance is the voluntary assent (agreement) to the terms of the offer. Generally only the person who receives the offer may accept it. ○ Mirror image rule ■ An acceptance cannot impose new conditions ○ Is this an effective acceptance: “I accept, please send me a written contract.” ■ Yes because the offeree is not adding any additional terms ■ However, “I accept if you send me a written contract” would be a counteroffer ○ Performance of an offer IS ALWAYS an acceptance. Silence is generally not an acceptance ■ Consider the combination of the Performance Rule and Mirror Image Rule ■ The “last shot” rule, means that the last acceptance accepts the last offer’s terms ■ So when the parties begin performing the contract, that accepts the last (counter) offer ○ Mailbox rule: acceptance is good when the moment a letter accepting a contract is physically mailed ● Allied Steel v. Ford Motor Co. ○ Timeline: ■ July of 1956 - Ford ordered a machine from Allied Steel, which included in the offer contract terms that Allied Steel is responsible for all injuries arising from acts on behalf of both Allied and Ford employees. ● Also included in the offer was the following language: “This purchase order agreement is not binding until accepted. Acceptance should be executed on acknowledgment copy which should be returned to buyer” ■ August of 1956: The work began. ■ September 5, 1956: Hankins, an Allied Steel employee, was injured at the Ford plant ■ November 12, 1956: Allied executed the contract and sent it back to Ford. ■ ISSUE:? ○ Rules: ■ “An offeror may prescribe the manner in which acceptance of his offer shall be indicated by the offeree...”
■ A promise to do what one already has a legal duty to do does not constitute legally sufficient consideration ■ E.g., a police officer cannot legally enforce a contract providing him an award for catching a crook ○ Past Consideration is not legally sufficient ■ There must be a BARGAINED-FOR aspect ■ E.g., Allen Iverson using the nickname “The Answer” ○ Illusory Promises: ■ When one person’s promise fails to actually obligate them to anything. ○ Vassilkovska v. Woodfield Nissan, Inc.: ■ An arbitration agreement where both parties agreed to arbitrate later arising disputes, except that Nissan drafted the contract with exceptions covering almost all possibilities. ■ No Consideration ● So Why Consideration? ○ 1. Minimize phony contract suits. ○ 2. Minimizing inadvertent contracts. ○ 3. Sparing the courts from enforcing trivial ○ contracts formed in family and social settings. ○ 4. Deterring opportunistic behavior. ○ 5. Evidence that the parties intended to form a contract ● Langer v. Superior Steel (PA 1935) ○ • Key Facts: A company gratuitously offered Mr. Langer, who was close to retirement age, a generous pension. The letter stated that so long as Mr. Langer remains loyal, does not take other employment, the pension would be offered. The company retracted the offer several years later. ○ • Issue? Did Consideration support the letter? ○ • Rule: If a contract was created, it was based on a consideration, and must have been the result of an agreement bargained for in exchange for a promise. ○ • Test: “A test of good consideration is whether the promise [has] undertaken to do anything... he was not bound to do ....’ [Likewise, G]ood consideration exists if one refrains from doing anything that he has a right to do.” ● Baugh v. Columbia (Ct. App. SC 2013) ○ • Facts: Dr. Baugh and Dr. Feldman were doctors at Columbia Heart Hospital. When the doctors became shareholders, they entered into “non-compete” agreements. These agreements state that if a doctor leaves Columbia Heart, they would not enter another practice which competes against Columbia Heart. The doctors’ salaries and duties remained the same at the time of signing. The doctors then left Columbia Heart, opening a new practice next to Columbia Heart. ○ • Contract: ■ • Article 5: “Physician, in the event of termination for any reason, shall not Compete with Columbia Heart.
■ • Article 4: “Physician shall be paid $5,000 per month for each month of the twelve months following termination, so long as the Physician is not in violation of Article 5 of the agreement” ○ • Ruling: “This language established that Columbia Heart promised to pay Baugh and Feldman a total of $60,000 over twelve months after termination so long as they did not violate the non-compete. Consequently, the agreements are supported by new consideration” ● Accord and Satisfaction ○ An agreement occurring when: “A debtor offers to pay, and a creditor accepts, a lesser amount than the creditor originally claimed was owed. ○ The accord is the agreement, the satisfaction concerns the prior debt. ○ What is the consideration problem? ○ For an accord and satisfaction(PAID AND GONE) to be effective, there must be a dispute about the original debt owed. ○ Release: a signed contract promising not to sue. The potentially litigated issue must be in good faith. ○ Covenant not to sue…
