Subj. Matter Jxn, Removal & Erie Analysis

Subj. Matter Jxn

  1. Dif. Btwn Fed State
    1. State
      1. Gen. Jxn so presume that state ct can dec. case / controv., incl'ing fed. stuff unless specif'ly only 4 fed.
      2. In fact, Testa v. Katt--have 2 hear fed. stuff
      3. Lec. 10/9 4 dif. btwn types of cts:
        1. Superior Ct
        2. Municipal Cts
        3. Small Claims Ct
    2. Fed
      1. Limited Jxn: by stt. & Const.
        1. Art III, §2 gives what outer limit of subj. matter jxn is but Const. not self exec'ing
      2. Imp. so
        1. Not WAIVABLE!
        2. Cts can raise the issue any X
      3. Pwr 2 Sanction w/o Subj. Matter Jxn
        1. If lie about cit. 4 diversity, ex., & then later reveal, ct. can retain pwr even w/o subj. matter jxn 2 impose sanctions when it seemed like there was apparent auth. 2 act
  2. Types of Subj. Matter Jxn in Fed.
    1. Arising Under §1331 (look 4 this 1st!)
    2. Diversity §1332
    3. Suppl. §1367
  3. Arising Under Jxn / Fed Quest. §1331
    1. Louisville & Nashville RR v. Mottley (p. 219 10/11)
      1. Breach of K, bill 4 relief, etc.
      2. Orig. Jxn of all civil axns arising under Const., laws, / treaties of US
      3. Anticipated defense of fed. stt. not count as "arising under" jxn
      4. Well pleaded complaint rule: 4 P 2 win the case, not nec. that rely on fed claim 4 relief
      5. Arising under means legal basis 4 claim / case rise under law that creates C/A
      6. Restrict subj. matter jxn
    2. Merrel Dow Case
      1. Claim arising under fed. law / fed. law creating C/A is arising under §1331
    3. Decl Jgmt
      1. If parties only flip-flopped, probably still no fed quest.
    4. Counterclaim
      1. Not initial claim into fed. quest.
    5. Stt. §1331 occupies portion of Const. Art III pwr
  4. Arising Under Jxn / Fed. Quest.: Const'al Basis
    1. Broader & stt. can always B 'ed
    2. Verlinden BV v. Central Bank of Nigeria (p. 226 10/11)
      1. Fed. Sov. Immunity Act involved which gives ability 2 sue bank (can sue sov's if act in commercial capacity)
      2. Ct said Cong. may confer on fed cts jxn over any case / controv. that might call 4 applic. of fed law
      3. It was purely defense but Const. allows Cong. 2 give 2 our fed cts 2 hear cases where fed law came into play
  5. Diversity: §1332
    1. Strawbridge v. Curtiss
      1. Must have compl. diversity on both sides
      2. Can't have Mass. v. Mass, Vt; but CAN have Mass. v. Vt, Vt
    2. Reqt's not in Const.
      1. Amt in controv.: 'er than $50,000 (4 the test anyway)
      2. Compl. diversity: Det. cit. @ X of file (both indiv. & corp.)
    3. Cit.
      1. Mas v. Perry
        1. To B cit. of state, Need 2 B US cit. AND domiciled in partic. state = residing + intention 2 remain indef'ly
        2. Can B resident somewhere else
        3. Even if not recov. amt of controv., that doesn't mean it fails subj. matter jxn
      2. Cit. of Corp. §1332)c
        1. State of incorp.
        2. Princ. place of busi.
          1. Bulk of activity test but if fails this THEN
          2. HeadQ / nerve center
        3. Policies (Rev. on own)
      3. Partnership / Unincorp'ed stuff
        1. Count cit. of all who make up partn's
    4. Amt in Controv.
      1. Mas v. Perry: even if not recov. amt, not fail subj matter jxn
      2. Intangible rts, then gen'ly assume more than $50,000
  6. Suppl. Jxn : §1367
    1. Ancillary & Pendant Jxn Before Suppl. Stt
      1. Ancillary if bring in 3rd party basically
      2. Pendant if hanging off of the main claim
    2. United Mineworker v. Gibbs (p. 239 10/18)
      1. Hurn Case allowed claims were part of same C/A
      2. Reqts which 'ed from Hurn
        1. Nonfrivolous fed. claim of subst'l substance which anchors the other claims 4 Const'al basis
        2. Derive from common nucleus of operative facts: underlying set of facts give rise 2 claims of relief p. 240 (ex. police beat up a guy: then fed. civil rts claim §1983, state tort claims of battery, assault, false imprisonment, etc.--same facts that give rise 2 dif. claims)
      3. Judge's discretion (any X) 2 hear state law claims
        1. If fed. claim dismissed early
        2. Likelihood of jury confusion
        3. Novel state claim / needless dec'ing state laws
        4. Fed. int. / state claim predominates (what if state claim asks 4 lot more than fed. like $1 mill. 4 state but $50,000 4 fed....etc.)
      4. Look @ class notes 4 what's fed. law area
    3. Owen Equip. & Erection Co. v. Kroger
      1. No suppl. jxn if destroys diversity btwn P & D
        1. Not Const'al viol. but stt. viol. of §1332
        2. If destroys diversity btwn D & 3PD, doesn't matter b/c not P so imp. of who sues 1st
    4. Stt. §1367
      1. Sub a: Part of same case / controv. under Art.III which is basically Gibbs test of arising out of common nucleus of operative act
      2. Sub b
        1. Same limitation as Owen v. Kroger Case
        2. No suppl. jxn by diversity if destroys diversity by claims by P against person made parties under Rule 14, 19, 20, / 24
      3. Sub c: judge's discretion
        1. State claim novel
        2. Predom. state claim
        3. Fed claim dismissed
        4. Exceptional stuff
        5. Executive Software Case (p. 337 in supp.) 4 dismissing
          1. Need factual predicate 2 exercise discretion (p. 341)
          2. Only when circ. unusual--articulate why circ. exceptional which doesn't incl. congestion
          3. Narrower than Gibbs
  7. Removal: 28 USC §1441
    1. No Const'al ref.
    2. Def
      1. One way st. of removing from state 2 fed
    3. Section 1441
      1. Sub a
        1. Any civil axns which dist. ct. have orig. jxn so §1331, 1332, 1367 like fed. quest. so not count counterclaim / fed. defense
        2. Can B removed ONLY BY D
      2. Sub b
        1. Not care about cit. / residence if arise under
        2. BUT in diversity (any other axn lang.), can only remove if D's R not cit. of state where axn brought
      3. Sub c
        1. Cases normally can't B brought but b/c of add'al claims, can remove w/fed. quest. stuff
        2. Although sounds like suppl. jxn, if state claim is part of same case / controv., then that's removable so this subsection must B covering stuff where state law claim not so rel'ed 2 fed. claim
        3. Quest. on whether this subsection is Const'al
        4. Somehow it seems that sep. & indep. claims mean something close 2 suppl. claims but not quite so obvious so this subsection prov's 4 remanding 2 state w/o going through judicial discretionary factors of §1367
    4. Section 1446 & 1447: Proced. on removing & proced. after removal
      1. Look over sections
        1. D's only have option of removing (all have 2 agree if more than 1) w/o P's consent
        2. File where fed. dist covering specif. geog. area
        3. Can't file removal 4 diversity after 1 yr. so restrict 4 diversity
      2. Main thing 2 remember: it creates strange sit. where rt. after filing, vanishes from state ct
  8. Erie
    1. Application 2 Whenever Subst. State Law Involved in FED CT
      1. Diversity Jxn
      2. Suppl. Jxn
    2. ID Subst v. Proced. Laws
      1. Subst. Rule
        1. How 2 live day 2 day (10/25 lec) like K law, tort, etc.
      2. Proced Rule
        1. Rules which tell cts how 2 conduct busi. / litig. stuff
        2. Not self def'ing & often used 2 control subst. rules
    3. Erie RR v. Tompkins (10/24, 269)
      1. Dealt only w/subst. law not proced. rule
      2. Prob's W/Swift v. Tyson Era (fed. ct applied fed C/L instead of state C/L)
        1. Const'al quest. on whether fed. ct have pwr 2 create law where Leg. didn't have pwr 2 create law
        2. Quest. on if law really exist before & judge just discov's v. make law
      3. No FED GEN C/L
        1. But they can create specif. fed. C/L / specif. fed. area
        2. Persch. implied that Cong. must speak 1st before fed. cts can create C/L originating from specif. fed. stt. (lec 10/25)
      4. Reinterp. of §1652
        1. Laws of state incl's both stt. & C/L in state so no more fed. gen C/L
        2. Const'ly Cong. not have pwr 2 give auth. 2 fed. cts 2 decl & create laws & not gave fed cts pwr 2 create C/L anyway
        3. Swift didn't create uniformity b/c states just did whatever they wanted
    4. Rules of Enabling Act §2072
      1. Same yr as Erie, this rule said Ct can create itself proced. rules
    5. Guaranty Trust Co. v. York (p. 279, 10/25)
      1. Issue of S/L: whether subst v. proced?
      2. Outcome Det. Test
        1. Not matter if labeled as subst. / proced. but only if what's @ issue sig'ly affect the rsln of litig. / outcome
        2. If state v. fed. law @ issue does affect, then fed. law must give way 2 state law
      3. This test undermines a lot of fed. stuff
    6. Byrd v. Blue Ridge Rural Electric Coop., Inc. (p. 284 10/29)
      1. Jury Trial @ issue
      2. Byrd Balancing Test
        1. Bound up test: whether state proced. sig'ly bound up / part of stt. scheme meaning, state proced. is bound up w/imp. state int.
        2. Aff. countervailing fed. policy / int.
        3. Doubt on if outcome subst'ly affected by use of fed. rather than state law
      3. Applic. 2 This case
        1. Not bound up 2 state int. but fed. ct. dec'ed that
        2. Fed. policy in jury dec. imp. but prob's b/c
          1. If 7th amend. Const'al, what states say not matter
          2. Not ans. why fed. int. of jury trial more imp. than state int.
      4. This test increases pwr 2 fed. stuff
    7. Hanna v. Plumer (p. 288 10/29)
      1. Service of Process @ Issue
      2. If There's No Fed Rule / Stt. @ Issue then Outcome Det. + Twin Aims of Erie (p. 290)
        1. Discourage forum shopping
        2. Avoid inequitable adm. of laws
      3. If There's Fed Rule / Stt. on Pt. in Conflict w/State Stt.
        1. Fed cts must apply FRCP even if clashes from state proced. b/c Cong. said 2 use FRCP by §2072
      4. Harlan's Recast of Byrd Test
        1. When state v. fed law, look @ if choice of rules subst'ly affect primary dec's of human conduct which our Const'al sys. leaves 2 state reg.

This material is copyrighted by the author. Use of the material for profit is expressly prohibited without the written permission from the author.

Go Back to Law School Notes

Ms. Haeji Hong

January 15, 1998