Monday, October 5, 2015

Today’s SCOTUS Oral Argument in OBB Personenverkehr v. Sachs

The new Supreme Court Term kicked off today with oral argument in OBB Personenverkehr AG v. Sachs. The case involves a couple of issues regarding the Foreign Sovereign Immunities Act (FSIA). Those issues are interesting in their own right, but today’s argument (transcript here) also featured some notable exchanges on personal jurisdiction, forum selection clauses, and other civil procedure topics.



October 5, 2015 in Supreme Court Cases | Permalink | Comments (0)

Thursday, October 1, 2015

Happy October! SCOTUS Cert Grants of Interest (Bank Markazi; Americold; MHN)

Today the Supreme Court issued its much-anticipated order list from the end-of-summer “long conference.” It granted certiorari in a few cases that folks interested in civil procedure and federal courts will want to keep an eye on:

Bank Markazi v. Peterson (No. 14-770), from the Second Circuit, is a separation-of-powers challenge to a congressional statute involving the execution of a judgment against bonds held by the Central Bank of Iran. Here is the question presented by the petitioner:

This case concerns nearly $2 billion of bonds in which Bank Markazi, the Central Bank of Iran, held an interest in Europe as part of its foreign currency reserves. Plaintiffs, who hold default judgments against Iran, tried to seize the assets. While the case was pending, Congress enacted § 502 of the Iran Threat Reduction and Syria Human Rights Act of 2012, 22 U.S.C. § 8772. By its terms, that statute applies only to this one case: to “the financial assets that are identified in and the subject of proceedings in the United States District Court for the Southern District of New York in Peterson et al. v. Islamic Republic of Iran et al., Case No. 10 Civ. 4518 (BSJ) (GWG).” Id. § 8772(b). “In order to ensure that Iran is held accountable for paying the judgments,” it provides that, notwithstanding any other state or federal law, the assets “shall be subject to execution” upon only two findings—essentially, that Bank Markazi has a beneficial interest in them and that no one else does. Id. § 8772(a)(1), (2). The question presented is:

Whether § 8772—a statute that effectively directs a particular result in a single pending case—violates the separation of powers.

Americold Logistics, LLC v. ConAgra Foods, Inc. (No. 14-1382), from the Tenth Circuit, involves how to determine the citizenship of a trust for purposes of diversity jurisdiction:

Petitioners Americold Logistics, LLC and Americold Realty Trust – a corporation and real estate investment trust, respectively – removed a case from Kansas state court to the United States District Court for the District of Kansas, asserting the parties were diverse. No party challenged the removal, and the District Court ruled on the merits of that litigation without addressing any issue relating to diversity jurisdiction. Likewise, neither party raised any jurisdictional challenge on appeal to the Tenth Circuit Court of Appeals.

The Tenth Circuit, however, sua sponte queried whether there was full diversity of citizenship among the parties. In particular, the judges challenged whether the citizenship of Americold Realty Trust, a business trust, should be determined by reference to its trustees’ citizenship, or instead by reference to some broader set of factors. This issue has deeply split courts across the country. Joining the minority of courts, the Tenth Circuit held the jurisdictional inquiry extends, at a minimum, to the citizenship of a trust’s beneficiaries in addition to its trustees’ citizenship. In this case, doing so destroyed diversity of citizenship among the parties.

The question presented by this petition is: Whether the Tenth Circuit wrongly deepened a pervasive circuit split among the federal circuits regarding whether the citizenship of a trust for purposes of diversity jurisdiction is based on the citizenship of the controlling trustees, the trust beneficiaries, or some combination of both.

MHN Government Services, Inc. v. Zaborowski (No. 14-1458), from the Ninth Circuit, is another case involving the relationship between the Federal Arbitration Act and state contract law. Here is the question presented by the petitioners:

The Federal Arbitration Act (“FAA”) provides that an arbitration agreement shall be enforced “save upon such grounds as exist at law or in equity for the revocation of any contract,” 9 U.S.C. § 2. California law applies one rule of contract severability to contracts in general, and a separate rule of contract severability to agreements to arbitrate. The arbitration-only rule disfavors arbitration and applies even when the agreement contains an express severability clause. Its application in this case conflicts with binding precedent of this Court and with opinions of four other courts of appeals.

The question presented is whether California’s arbitration-only severability rule is preempted by the FAA.  

You can find coverage of today’s cert. grants from SCOTUSblog’s Lyle Denniston here.


October 1, 2015 in Federal Courts, Recent Decisions, Subject Matter Jurisdiction, Supreme Court Cases | Permalink | Comments (0)

Wednesday, September 30, 2015

House Judiciary Committee Hearing on "Fraudulent Joinder Prevention Act"

The House Judiciary Committee held a hearing yesterday on a bill entitled “The Fraudulent Joinder Act of 2015.”  Minority witness, Professor Lonny Hoffman, testified against the bill.

The bill, H.R. 3624, provides:

Section 1447(c) of title 28, United States Code, is amended by adding at the end the following:

“A motion for remand, and any opposition thereto, may include affidavit or other evidence showing a plausible claim for relief against each nondiverse defendant, or the lack thereof, or indicating a good faith intention to prosecute the action against each nondiverse defendant or to seek a joint judgment, or the lack of such a good faith intent. The district court shall deny a motion to remand if it finds that the complaint does not state a plausible claim for relief against a nondiverse defendant under applicable state law or there is no good faith intention to prosecute the action against a nondiverse defendant or to seek a joint judgment.”

Professor Hoffman explains the bill’s effect: “The bill would replace the existing common law fraudulent joinder test with a statutory test that places the burden on the plaintiff to prove that her claims against the non-diverse defendant are ‘plausible’ and brought in ‘good faith.’ Overall, the bill would make proving fraudulent joinder much easier than it is under current law.”

One of the majority witnesses, Elizabeth Milito, Senior Executive Counsel of the National Federation of Independent Business Small Business Legal Center, asserted the need for the bill:

[F]or a small business owner being served with lawsuit generates significant trepidation, disgust, and yes, uncertainty.

Because litigation entails angst and great expense for small businesses, NFIB is pleased to see this Committee’s attention focused on the issue of fraudulent joinder. Fraudulent joinder remains a source of confusion and unnecessary litigation in our courts and impacts far too many innocent small businesses. The situation unfolds as follows: plaintiffs’ attorneys will name a small business – such as a local pharmacy or insurance agent – with little connection to the complaint in order to deny the federal courts of jurisdiction. In many instances, the plaintiff has no intention of imposing liability on the fraudulently joined party. With courts divided over the standard for finding that a defendant is fraudulently joined, the small business is forced to engage in protracted litigation when all they want is to be dismissed from the case entirely.


In opposition to the bill, Professor Hoffman’s introduction summarizes his testimony:

There is no warrant for amending 28 U.S.C. §1447. More than a century old, fraudulent joinder law is well-settled and strikes the proper balance among competing policies in how it evaluates the joinder of non-diverse defendants. With recognition that there are sound reasons for not trying to exhaustively examine the merits of the plaintiff’s claims immediately after removal, courts across the circuits uniformly impose a high burden on the defendant to demonstrate that a non-diverse defendant’s joinder was improper. That burden can only be met if the defendant establishes that the joinder of the diversity-destroying party in the state court action was made without a reasonable basis of proving any liability against that party. By greatly expanding the scope of the fraudulent joinder inquiry, this bill would displace the well-functioning law with wasteful adjudications that district courts are ill-equipped to undertake at the remand stage, burdening the judicial system and raising litigation costs for all parties, especially for plaintiffs on whom this bill imposes the burden of proof. Finally, by requiring that courts resolve merits inquiries that under current law are decided by state courts, the proposed amendments to §1447 raise federalism concerns.

Continue reading

September 30, 2015 in Current Affairs, Federal Courts, Subject Matter Jurisdiction | Permalink | Comments (0)

Tuesday, September 29, 2015

Articles from Symposium on Judicial Education Now Available

Last fall, the University of Missouri held a symposium entitled "Judicial Education and the Art of Judging:  From Myth to Methodology."  The articles from this symposium are now available at the University of Missouri scholarship website and will shortly be up on Westlaw and LexisNexis. 


Judicial Education and Regulatory Capture: Does the Current System of Educating Judges Promote a Well-Functioning Judiciary and Adequately Serve the Public Interest? --S. I. Strong

What Judges Want and Need: User-Friendly Foundations for Effective Judicial Education --Duane Benton and Jennifer A.L. Sheldon-Sherman

Judicial Bias: The Ongoing Challenge --Kathleen Mahoney

International Arbitration, Judicial Education, and Legal Elites --Catherine A. Rogers

Towards a New Paradigm of Judicial Education --Mary R. Russell

Writing Reasoned Decisions and Opinions: A Guide for Novice, Experienced, and Foreign Judges --S. I. Strong

Judging as Judgment: Tying Judicial Education to Adjudication Theory --Robert G. Bone

Of Judges, Law, and the River: Tacit Knowledge and the Judicial Role --Chad M. Oldfather

Educating Judges—Where to From Here? --Livingston Armytage

Judicial Education: Pedagogy for a Change --T. Brettel Dawson

Hat tip: S.I. Strong

September 29, 2015 in Conferences/Symposia, Recent Scholarship | Permalink | Comments (0)

Monday, September 28, 2015

Podcast of Professors Thomas and Lerner in Debate on the Civil Jury

Professor Suja Thomas (University of Illinois College of Law) and Professor Renee Lettow Lerner (George Washington University School of Law) recently participated in a debate on civil juries under the auspices of the Federalist Society's Litigation Practice Group.  Professor Thomas argued in favor of the civil jury, while Professor Lerner argued the civil jury's downsides. 

September 28, 2015 in Current Affairs | Permalink | Comments (0)

Friday, September 25, 2015

Means and Seiner on Navigating the Uber Economy


Professors Benjamin Means and Joseph Seiner (University of South Carolina School of Law) have posted on SSRN their essay, "Navigating the Uber Economy," forthcoming in U.C. Davis Law Review.


In litigation against ride-sharing companies Uber and Lyft, former drivers have alleged that they were misclassified as independent contractors and denied employment benefits. The companies have countered that they do not employ drivers and merely license access to a platform that matches those who need rides with nearby available drivers. At stake are the prospects, not only for Uber and Lyft, but for a nascent, multi-billion dollar "on-demand" economy.

Unfortunately, existing laws fail to provide adequate guidance regarding the distinction between independent contractors and employees, especially when applied to the hybrid working arrangements characteristic of a modern economy. Under the Fair Labor Standards Act and analogous state laws, courts consider several factors to assess the "economic reality" of a worker's alleged employment status; yet, there is no objective basis for prioritizing those factors.

This Essay argues that the classification of workers as independent contractors or employees should be shaped by an overarching inquiry: how much flexibility does the individual have in the working relationship? Those who can choose the time, place and manner of the work they perform are more independent than those who must accommodate themselves to a business owner's schedule. Our approach is novel and would provide an objective basis for adjudicating classification disputes, especially those that arise in the context of the on-demand economy. By reducing legal uncertainty, we would ensure both that workers receive appropriate protections under existing law and that businesses are able to innovate without fear of unknown liabilities.

September 25, 2015 in Class Actions, Current Affairs, In the News, Recent Scholarship | Permalink | Comments (0)

Friday, September 18, 2015

House Passes "Lawsuit Abuse Reduction Act" (Redux)

The House of Representatives passed the so-called "Lawsuit Abuse Reduction Act" yesterday, and it will now go to the Senate.  According to, this is the fourth time that the bill, or a similar version, has passed the House.   

We briefly described the present version of the bill here.   Professor Lonny Hoffman testified against an earlier version of the bill in 2011.

The ABA urged Congress not to pass the bill, but its efforts apparently fell on deaf ears in the House.



September 18, 2015 | Permalink | Comments (0)

Judicial Conference Issues Strategic Plan for Federal Judiciary

The Judicial Conference approved a new Strategic Plan for the Federal Judiciary on September 17, 2015.  If you’ve ever participated in drafting a strategic plan for your law school or other organization, you know the familiar jargon: mission statement, core values, issues, strategies, and goals.  They even had an “Ad Hoc Strategic Planning Group.”  (Federal judges – they’re just like us!)


As a person who has often been involved in strategic planning, I found it a bit disconcerting to see the Judicial Conference adopting the familiar buzzwords.  (I wonder if they had the perennial “what is the darn difference between a strategy and a goal” discussion.)


So here’s the Mission Statement of the federal judiciary:

The United States Courts are an independent, national judiciary providing fair and impartial justice within the jurisdiction conferred by the Constitution and Congress. As an equal branch of government, the federal judiciary preserves and enhances its core values as the courts meet changing national and local needs.   


The core values:

Rule of Law: legal predictability, continuity, and coherence; reasoned decisions made through publicly visible processes and based faithfully on the law

Equal Justice: fairness and impartiality in the administration of justice; accessibility of court processes; treatment of all with dignity and respect

Judicial Independence: the ability to render justice without fear that decisions may threaten tenure, compensation, or security; sufficient structural autonomy for the judiciary as an equal branch of government in matters of internal governance and management

Accountability: stringent standards of conduct; self-enforcement of legal and ethical rules; good stewardship of public funds and property; effective and efficient use of resources

Excellence: adherence to the highest jurisprudential and administrative standards; effective recruitment, development and retention of highly competent and diverse judges and staff; commitment to innovative management and administration; availability of sufficient financial and other resources

Service: commitment to the faithful discharge of official duties; allegiance to the Constitution and laws of the United States; dedication to meeting the needs of jurors, court users, and the public in a timely and effective manner


Then there are “seven issues--fundamental policy questions or challenges that are based on an assessment of key trends affecting the judiciary’s mission and core values”:

Issue 1: Providing Justice

Issue 2: The Effective and Efficient Management of Public Resources

Issue 3: The Judiciary Workforce of the Future

Issue 4: Harnessing Technology’s Potential

Issue 5: Enhancing Access to the Judicial Process

Issue 6: The Judiciary’s Relationships with the Other Branches of Government

Issue 7: Enhancing Public Understanding, Trust, and Confidence


Within each issue are strategies (such as “Strategy 1.1. Pursue improvements in the delivery of justice on a nationwide basis”) and goals (such as “Goal 1.1a: Reduce delay through the work of circuit judicial councils, chief judges, Judicial Conference committees and other appropriate entities”).


I did not find (on quick perusal) any specific mention of the Supreme Court or of cameras in the courtroom, despite “Strategy 7.2: Improve the sharing and delivery of information about the judiciary.” 


September 18, 2015 in Federal Courts | Permalink | Comments (0)

Thursday, September 17, 2015

Recent Papers on Article III Standing; More Academic Amici Favoring Respondent in Spokeo Case

In addition to Restitution and Remedies Scholars, two other groups of scholars filed amicus briefs in the Supreme Court in Spokeo, Inc. v. Robins on the side of Respondent:

Information Privacy Law Scholars 

Public Law Professors


Academics filed no amicus briefs in favor of Petitioner Spokeo. 


Two other articles on Article III standing have recently been posted on SSRN:

'Spooky Action at a Distance': Intangible Injury in Fact in the Information Age by Seth F. Kreimer of University of Pennsylvania Law School.  Abstract:

Two decades after Justice Douglas coined “injury in fact” as the token of admission to federal court under Article III, Justice Scalia sealed it into the constitutional canon in Lujan v. Defenders of Wildlife. In the two decades since Lujan, Justice Scalia has thrown increasingly pointed barbs at the permissive standing doctrine of the Warren Court, maintaining it is founded on impermissible recognition of "Psychic Injury." Justice Scalia and his acolytes take the position that Article III requires a tough minded, common sense and practical approach. Injuries in fact must be "tangible" "direct" "concrete" "de facto" realities in time and space free from spooky entities like "Psychic Injury."

Albert Einstein famously took the position that quantum mechanics could not be a proper and complete theory on the ground that "[P]hysics should represent a reality in time and space, free from spooky actions at a distance." The problem that ultimately overtook Einstein's argument was that experimental results vindicating quantum mechanics stubbornly continued to appear in the journals. The burden of this paper is to demonstrate that spooky "injuries in fact" involving information have stubbornly continued to appear in United States Reports. It demonstrates that the Court has regularly adjudicated the controversies of the information age: disputes regarding illicit acquisition of information, denial of access to information, improper exposure to information and intellectual property. And it argues that the Court will continue to do so.

These adjudications fatally undermine an account of Article III that insists on "direct" "tangible" and "palpable" injuries to physical or economic interests as the price of admission to the federal courthouse, and profoundly alter notions of "particularized" and "imminent" injury. Information is by nature intangible, and information plays an increasingly dominant role in our social, economic, political and cultural life. Information is largely non-rivalrous and non-excludable. Violations of duties regarding information thus regularly result in injuries that are "general" rather than "particularized." And, with the advent of the Internet, informational harm is pandemically "imminent": information can be spookily and instantaneously "present" at opposite ends of the country, or of the globe.


Article III Standing for Private Plaintiffs Challenging Greenhouse Gas Regulations by Bradford C. Mank of University of Cincinnati Law School.  Abstract:

An important unresolved question is whether non-state plaintiffs have standing under Article III of the U.S. Constitution to sue in federal courts in climate change cases. In Massachusetts v. EPA, the Supreme Court held a state government could sue the U.S. government to address climate change issues, and suggested, but did not decide, that private litigants might have lesser rights than states. In Washington Environmental Council v. Bellon, the Ninth Circuit held that private groups did not have standing to challenge Washington State’s failure to regulate greenhouse gas (GHG) emissions from five oil refineries, and implied that private plaintiffs may never bring climate change suits because such suits are generalized grievances and the Massachusetts exception for GHG suits applies only to states. However, dissenting from the Ninth Circuit’s denial of a rehearing en banc, three judges argued that the panel’s opinion was overly broad in interpreting the Massachusetts decision to deny standing rights to all non-state GHG plaintiffs. In recent district court decisions, two different federal judges concluded that private plaintiffs may have Article III standing to challenge the government’s regulation of climate change or greenhouse gases. In Center for Biological Diversity v. EPA, the Western District of Washington held the plaintiff suffered concrete standing injuries from the defendant EPA’s approval of Washington’s and Oregon’s decisions not to identify any waters experiencing ocean acidification as impaired under the Clean Water Act (CWA). In distinguishing the Washington Environmental Council decision, the district court concluded that the plaintiffs demonstrated local GHG impacts, and local mitigation efforts could partially redress the injuries to their members. In Murray Energy Corporation v. Gina McCarthy, Administrator of EPA, the Northern District of West Virginia concluded that that the plaintiffs sufficiently established that the EPA violated its duty under the Clean Air Act (CAA) to examine the employment impacts of its enforcement and regulations under the Act on employment in the coal mining industry to have standing. The Murray decision’s focus on employment injuries could be used to provide standing in a challenge to GHG regulations. While there is an argument that expanding standing to non-state GHG plaintiffs could flood the federal courts with too many suits, courts can manage the number of climate change suits by requiring a meaningful demonstration of a connection between GHG emissions and harms to the plaintiffs, and by giving substantial deference to reasonable government regulatory policies in this area.

September 17, 2015 in Recent Scholarship, Standing, Supreme Court Cases | Permalink | Comments (0)

Wednesday, September 16, 2015

House Committee to Consider Bill Making Rule 11 Sanctions Mandatory

The House Committee on Rules is scheduled to consider the Lawsuit Abuse Reduction Act of 2015 (H.R. 758) tonight, September 16, 2015, at 7:00 p.m.

We identified the key features of this bill earlier here.  


September 16, 2015 in Federal Rules of Civil Procedure | Permalink | Comments (0)

Tuesday, September 15, 2015

Bank Reportedly Spends $1.2 Million Fighting Case Rather Than Settle for $200,000

NPR this morning has a story entitled "When Cyber Fraud Hits Businesses, Banks May Not Offer Protection."  It describes some instances in which small businesses that had their bank accounts drained by cyber fraud were unpleasantly surprised to find that their banks were not legally obligated to reimburse them (unlike in most cases for bank accounts owned by individuals). 


The story of one company contradicted the frequent assertion by defendants that defendants in civil suits are often "forced to settle" because the costs of defense exceed the claim.  One of the victimized businesses found its checking account down by $545,000 due to cyber fraud: 


[The owner of the construction company involved] thought his bank . . . would reimburse him. It refused, and he sued. [The owner] says the bank threw a huge amount of resources at the case. He says he discovered in mediation that the bank had spent "in excess of $1.2 million fighting this, when we offered to settle this for $200,000."

[The construction company] lost the first round but won on appeal when a panel of judges concluded [the bank's] security had not been commercially reasonable. 


Another small business lost $14,000 due to cyber fraud, and its owner  "considered suing [his bank], but was advised he'd spend much more on legal fees than he'd recover." 


September 15, 2015 in Current Affairs, In the News | Permalink | Comments (0)

Fifth Circuit Bar Association Hosts Appellate Advocacy Seminar in New Orleans

The Bar Association of the Fifth Federal Circuit has an upcoming Appellate Advocacy Seminar in New Orleans.  The Bar Association writes:
On October 5 and 6, 2015, the Bar Association of the Fifth Federal Circuit will host our Annual Appellate Advocacy Seminar in New Orleans. The cost is $100 for 9.75 hours of Continuing Legal Education, including both an hour of Professionalism and an hour of Ethics. Attend a two-hour writing workshop to hone your brief-writing skills, observe oral arguments and get practice tips from seasoned attorneys and sitting judges. This seminar is an ideal introduction to federal appellate practice, with specifics about Fifth Circuit procedures. 


September 15, 2015 in Conferences/Symposia | Permalink | Comments (0)

Monday, September 14, 2015

Scholars File Amicus Brief in Spokeo Case Supporting Respondent Robins

On September 8, 2015, ten current or former law professors filed their Brief of Restitution and Remedies Scholars as Amici Curiae in Support of Respondent. 


The brief states (at pp. 1-2):


If this Court were to adopt petitioner’s proposed rule — that a plaintiff who suffers no harm beyond the loss of his legal rights has no standing to sue — it could wreak havoc with the law of restitution and unjust enrichment, barring many long-established causes of action from federal courts. This important body of law long predates the American founding and serves essential functions, especially in private law but in parts of public law as well.


These amici take no position on the underlying statutory claim.




Petitioner’s sweeping and ill-defined argument that no plaintiff can have standing without proof of “concrete harm” is aimed at claims for statutory minimum damages. The Court should reject this frontal assault on statutory remedies. But whatever the Court does with respect to statutory damages, it should take care not to inadvertently sweep away much of the law of restitution.


The ten individual amici are Mark P. Gergen, Andrew Kull, Douglas Laycock, Colleen P. Murphy, Phil C. Neal, Doug Rendleman, Caprice Roberts, Chaim Saiman, Emily L. Sherwin, and Michael Traynor.  Nine of the ten amici participated in drafting the Restatement (Third) of Restitution and Unjust Enrichment as Reporter, Adviser, or on the Members Consultative Group.

September 14, 2015 in Standing, Subject Matter Jurisdiction, Supreme Court Cases | Permalink | Comments (0)

Friday, September 11, 2015

How to Improve Your State's "Lawsuit Climate": Reduce the State's Population

So you send a survey to people whose job depends on how well they do defending their $100-million-plus employer in court and ask them how fair and reasonable the courts are.  If they just lost a big verdict in Texas, they probably think juries in Texas are unfair and the judge who tried the case is an idiot.  (A friend who was born and raised on a farm said that it was like asking foxes to rate how fairly the farmer guarded the henhouse.)

Compile all those subjective answers, assign some ordinal numbers to them, and rank the fifty states: that’s about the long and short of the U.S. Chamber Institute for Legal Reform’s 2015 "lawsuit climate survey" conducted by Harris Poll "to explore how fair and reasonable the states’ tort liability systems are perceived to be by U.S. businesses."  (The full report is here.

To be fair, if you read the report carefully, it does not misrepresent what it purports to show.  It never says it is a random survey (and it isn't).  It explains that the only people asked to participate are lawyers and other executives who are in charge of litigation for companies with at least $100 million in annual revenues.  (It doesn’t say, but it’s fairly obvious, that these companies are overwhelmingly defendants, not plaintiffs, in lawsuits.)  The report admits that what it measures are these executives’ “perceptions” (p. 3 of the Executive Summary), not any objectively quantifiable element of a state’s justice system, such as the caseload per judge.

But the sheer repetition of the ensuing headlines (egged on by the Chamber's state-specific press releases) encourages the casual reader to elide the difference between objective reality and the subjective perceptions of a very distinct interest group.  A sampling:

"Florida's 'lawsuit climate' hits all-time low, Chamber survey says" (Tampa Bay Times)

"Survey: Missouri’s Lawsuit Climate Hits All-Time Low, Ranks Among Nation’s Worst" (Associated Press, via ABC's WAAY-TV)

Once again, Louisiana’s lawsuit climate ranked second worst in US (Greater Baton Rouge Business Report)

And that's not even counting the "coverage" of the survey by news-like websites that are owned by the U.S. Chamber of Commerce, such as the West Virginia Record and the Madison-St. Clair Record, or op-eds planted by the U.S. Chamber Institute for Legal Reform.  

Anyway, the purpose of this post is not to go through the myriad glaring problems with the survey. But I can't resist pointing out one of many examples: the survey respondents really couldn't help calling Cook County, Illinois or Miami-Dade County "among the worst city or county courts."  That is because the survey respondents were given twelve listed locations to pick from, which included those two locations, and the respondents would have had to think of any other jurisdiction on their own. Question 637 (p. 127 of the full report) is:

Thinking about the entire country, which of the following do you think are the worst city or county courts? That is, which city or county courts have the least fair and reasonable litigation environment for both defendants and plaintiffs? Please select up to two responses.    

1 Chicago or Cook County, Illinois

2 Los Angeles, California

3 San Francisco, California

4 Philadelphia, Pennsylvania

5 Madison County, Illinois

6 Miami or Dade County, Florida

7 New Orleans or Orleans Parish, Louisiana

8 New York, New York

9 East Texas

10 St. Louis, Missouri

11 Detroit, Michigan

12 Washington, DC

13 Other [ONLINE: (Please specify)] [ PHONE: CAPTURE RESPONE]

14 Not sure

99 Decline to answer [EXCLUSIVE] [PHONE ONLY]

The twelve listed locations were randomized for each survey respondent, so they were not necessarily listed in the order above for any given respondent.  But it's a great example of the availability heuristic.

Anyway, setting aside the problems with the survey, I noticed this: in general, the fewer people who live in a state, the better that state's "lawsuit climate" is perceived.    

Many of the top-ranked states (with the “best” perceived “litigation climates”) in the Chamber's survey are states with the fewest people.  Using census data for 2014, I ranked the states from 1 to 50, from most populous to least populous.  For example, California has the largest population, so is ranked #1, and Wyoming has the fewest people, so it's ranked #50.  I then compared the 15 least populous states (ranked 36-50) with the "best" 15 states in the U.S. Chamber's survey (ranked 1-15).  Ten states were on both lists: Alaska, Delaware, Idaho, Maine, Nebraska, New Hampshire, North Dakota, South Dakota, Vermont, and Wyoming.   

In other words, the Chamber rankings are negatively correlated with the population rankings: in general, as the state's population goes down, the perception of its "lawsuit climate" goes up.   Here is a scatterplot of the fifty states and a fitted line:

 Pop and chamber ranks

I’ve labeled two of the fifty data points as examples.  California is ranked #1 in population (the y-axis) and #47 in the Chamber survey (the x-axis).  Delaware is ranked #45 in population and #1 in the Chamber survey (the “best” in the country).

So what does this all mean?  Of course, correlation is not the same as causation.  But maybe if there are fewer people, there are fewer things to go wrong (industrial accidents, adverse drug reactions, discriminatory employment decisions), so there are fewer lawsuits.  Just a simple-minded theory.




September 11, 2015 in Current Affairs, In the News | Permalink | Comments (0)

Wednesday, September 9, 2015

Disinformation About Standing and the Spokeo Case

Oh, why did I allow myself to be lured by SCOTUSBlog's cite to a blog post about Spokeo, Inc. v. Robins in the "Liberty Blog" of the Pacific Legal Foundation?  


The post manages, in five short paragraphs, to put words in Linda Greenhouse’s mouth, to mischaracterize the complaint in Spokeo, to flip constitutional standing on its head, and to assert that wealthier is always better.


The post, written by Wen Fa, takes issue with a recent New York Times op-ed by Ms. Greenhouse that primarily asserted that some conservative judges have an expansive reading of the standing doctrine when it suits them for ideological purposes, as in Fisher v. University of Texas, the affirmative-action case currently pending before the Supreme Court.  Ms. Greenhouse only mentions Spokeo in the last paragraph, which states in full:


Also on the court’s docket for its new term is a fascinating case that raises the question of whether Congress can confer standing by enacting a law that gives people the right to sue for a technical legal violation that might not amount to the “injury in fact” — actual harm — that would otherwise be necessary to sustain a lawsuit in federal court. The statute at issue in this case, Spokeo, Inc. v. Robins, is the Fair Credit Reporting Act. Similar citizen-suit provisions are common among federal statutes, with this case representing the tip of a very big iceberg. We’ll soon learn more about who these days stands for standing.


The PLF blog post claims that Ms. Greenhouse’s op-ed “lamented the likely result of” Spokeo.  As anyone can see from the above quote from the op-ed, she did not even hint at “the likely result” of Spokeo, let alone “lament” it. 


Then, PLF lets loose with this doozy of distortion:


In Spokeo v. Robins, PLF argues [presumably, the author means in the amicus brief filed by Pacific Legal Foundation] that Article III injury can’t just be created by congressional fiat, and a plaintiff who sued a website for listing him as wealthier and better educated has no standing to bring his case in federal court. The Court seems poised to adopt our argument . . . .


It is not true that Mr. Robins is just suing Spokeo “for listing him as wealthier and better educated.”  That is not “all” that Mr. Robins has alleged, factually or legally.  But PLF continues: “All Robins has to complain about . . . is that a person who happens to stumble upon his Spokeo page may think that he has more money and more degrees than he does in reality. But those are desirable traits.”  (emphasis added)


Actually, here’s what the First Amended Complaint alleges:


31. The consumer report that Spokeo has compiled about Plaintiff Robins correctly describes his basic identifying information such as address, neighborhood, and siblings’ names; however, for an extensive period of time most of the other information was incorrect. For example, a picture Defendant reported to be an image of Robins was not in fact Plaintiff, the profile incorrectly stated he was in his 50s, that he was married, that he was employed in a professional or technical field, and that he has children.

32. While some changes have been made to Plaintiff’s profile, it continues to represent that he has a graduate degree, that his economic health is “very strong,” and that his wealth level is in the “Top 10%.”

33. Plaintiff has no way of verifying the “economic health” rating Defendant ascribes to him, and denies that his “wealth level” is accurately described.

34. Defendant’s inaccurate report is particularly harmful to Plaintiff in light of the fact that he is currently out of work and seeking employment. In fact, Mr. Robins has been actively seeking employment throughout the time that Spokeo has displayed inaccurate consumer reporting information about him and he has yet to find employment.


The complaint also alleges that Mr. Robins has suffered actual harm to his employment prospects, to his finances, and “in the form of anxiety [and] stress … about his diminished employment prospects.”


In the context of what Mr. Robins alleges, which is that he is trying to find a job, it would, in fact, usually be worse for a prospective employer to think you’re in your 50s than in your 20s, 30s, or 40s.  Age discrimination does exist, and employers typically pay younger employees less than older employees.  Moreover, depending on the job, it might be worse for a prospective employer to think you’re married with children rather than single and childless.  Married parents have more work/life conflicts and family obligations than single people without kids.  And if you’re trying to get that first entry-level position as a college grad, it very well could be worse for a prospective employer to think you hold a graduate degree and are in the “top 10%” of people in terms of wealth.  The employer might think that you’re overqualified for the position, have a strong sense of entitlement, or expect a higher salary than they’re prepared to offer.  Finally, if you look like George Clooney, it would generally be better if a prospective employer doesn't see a photograph purporting to be you that looks like Marty Feldman (unless, of course, the prospective employer is casting for Young Frankenstein).  There are studies showing that good-looking people get hired more easily and often than unattractive people.     


And those are just the facts that PLF has got wrong.  In terms of legal claims, the complaint alleges that, in violation of the FCRA, Spokeo has not (1) adopted reasonable measures to ensure the accuracy of its consumer reports, (2) provided any of the statutorily-required notices to furnishers or users of information contained in the reports, or (3) provided consumers with a toll-free telephone number to request annual file disclosures.


What about PLF’s proclamation that “Article III injury can’t just be created by congressional fiat”?  Actually, Congress can create new statutory rights, the violation of which will suffice to grant standing, and Congress has done so hundreds of times and for hundreds of years.  As mentioned in respondent Robins' merits brief, the first Congress in 1790 authorized statutory damages for a copyright violation without proof of actual loss.  And Justice Story in 1838, speaking of a common-law property right, stated, “Actual, perceptible damage is not indispensable as the foundation of an action. The law tolerates no farther inquiry than whether there has been the violation of a right. If so, the party injured is entitled to maintain his action for nominal damages, in vindication of his right, if no other damages are fit and proper to remunerate him.”  Webb v. Portland Mfg. Co., 29 F. Cas. 506, 508 (C.C.D. Me. 1838).  Justice Story understood this principle “from [his] earliest reading” and “considered it laid up among the very elements of the common law.”


Literally hundreds of state and federal statutes create private rights of action to encourage compliance with laws meant to protect consumers, workers, and the environment.  Many of these statutes authorize statutory damages in recognition that actual damages can sometimes be difficult to prove and to incentivize private plaintiffs to enforce the law. 


Spokeo and its seventeen business amici recently conceived a new way to neutralize any statute anywhere that authorizes statutory damages.  That is: tar the private right of action with the newfangled pejorative “injury-in-law” (the better to distinguish it from the constitutionally-required “injury-in-fact”) and claim that violation of the statute is “technical,” “trivial,” or not a “real-world” injury – so not good enough for standing. 


The sheer audacity of this argument is breathtaking.  The vast majority, if not all, of the Supreme Court’s Article III standing cases involve a plaintiff suing a governmental department, agency, or official, asking a court to tell that governmental actor what to do.  It is in that sense that the Court has repeatedly stated that the primary concern of the Article III standing doctrine is separation of powers – in most cases, to keep the courts out of the executive branch. 


The Spokeo case is a case between private parties, not a case against the government.  Here, Spokeo’s newfangled standing doctrine would tear down a pretty large section of the separation-of-powers wall.  It would allow federal judges to eviscerate laws that were validly enacted by the legislative branch, by refusing to countenance the violation of those laws as “injury.”  And it would nullify statutory damages by requiring proof of actual damages in order to be entitled to statutory damages.


How, exactly, would it uphold separation of powers if judges refuse to honor statutes they disagree with?  And who, exactly, would have standing to sue under the FCRA, according to Spokeo and PLF, if Mr. Robins doesn’t? 


The more I look into this, the bigger I think this case is.           


To get back to PLF’s blog post: why does PLF think “the Court seems poised to adopt [its] argument”?  Does it have inside information that five justices are ready to effectively repeal an assortment of federal statutes?

September 9, 2015 in Standing, Supreme Court Cases | Permalink | Comments (0)

Meier on the Reviewability of Denied Twombly Motions

Luke Meier (Baylor University Law School) has posted on SSRN his latest article, The Reviewability of Denied Twombly Motions, forthcoming in The University of Cincinnati Law Review.


This article argues in favor of permitting appellate review of a denied Twombly motion when a defendant appeals an adverse final judgment. With regard to denied summary judgment motions, the question of post-judgment appellate review has caused considerable confusion in the last few years. This article aims to prevent this confusion from developing with regard to denied Twombly motions and, in the process, to clear up the existing uncertainty with regard to appellate review of denied summary judgment motions. The critical step towards this goal is distinguishing between “mootness” and “forfeiture.” Because a denied Twombly motion is not rendered moot by subsequent proceedings in the district court, and because a defendant does not forfeit appellate review of a denied Twombly motion, appellate courts should assess the propriety of the denial of a Twombly motion in an appeal from a final judgment. This conclusion might appear, on first impression, outrageous. But it is the proper conclusion under existing rules governing the availability of appellate review.

September 9, 2015 in Recent Scholarship, Twombly/Iqbal | Permalink | Comments (0)

CFP: New Voices in Civil Justice at Vanderbilt



Vanderbilt Law School’s Branstetter Litigation & Dispute Resolution Program invites submissions for its 2016 New Voices in Civil Justice Scholarship Workshop, to be held May 2 3- 2 4 , 2016, at Vanderbilt Law School.

The Branstetter Program draws on a multimillion-dollar endowment to support research and curriculum in civil litigation and dispute resolution. Held annually, the Branstetter New Voices Workshop brings together junior scholars, senior scholars, and Vanderbilt faculty in the areas of civil justice. This year, three to four junior scholars will be selected via a blind review process to present at the New Voices Workshop.

The New Voices format maximizes collegial interaction and feedback. Paper authors do not deliver prepared “presentations.” Rather, all participants read the selected papers prior to the session, and at each workshop, a senior faculty member provides a brief overview and commentary on the paper. Open and interactive discussion immediately follows.

For further information and submission requirements, see the call for papers on the Vanderbilt website.


September 9, 2015 | Permalink | Comments (0)

Friday, September 4, 2015

Court Cites (but Does Not Rely on) FRCP Form 7, Holds Diversity Allegations Sufficient

            The Third Circuit has held that a plaintiff may survive a facial attack on diversity jurisdiction in a suit against an LLC without specifically alleging the state of citizenship of each member of the LLC.  Lincoln Benefit Life Co. v. AEI Life, LLC, No. 14-2660 (3d Cir. Sept. 2, 2015).  The plaintiff life insurance company (incorporated and with its principal place of business in Nebraska) sought a declaratory judgment voiding two policies that it alleged were procured by fraud.  Among the defendants were two LLCs.   


            An LLC’s citizenship for purposes of diversity jurisdiction is determined by the citizenship of its members.  Not able to ascertain the citizenship of these two LLCs’ members through publicly-available sources, the plaintiff alleged “upon information and belief” that the two defendants were citizens of New York and New Jersey, respectively, based on their mailing addresses.


            The defendants moved to dismiss for lack of subject matter jurisdiction, arguing that plaintiff was required to allege the citizenship of each member of the LLC defendants.  The district court granted the motion to dismiss and denied plaintiff’s request for jurisdictional discovery.


            The Third Circuit reversed.  It distinguished between a facial attack and a factual attack when made in a 12(b)(1) motion: “A facial attack ‘concerns an alleged pleading deficiency’ whereas a factual attack concerns ‘the actual failure of [a plaintiff’s] claims to comport [factually] with the jurisdictional prerequisites.’”  (some internal quotation marks omitted) 


            The defendants here had mounted a “facial challenge to the adequacy of the jurisdictional allegations in [the] complaint.”  None of the defendants had actually alleged that it was a citizen of Nebraska (which would have destroyed diversity). 


            Turning to Rule 8(a)(1), which requires a complaint to make a “short and plain statement of the grounds for the court’s jurisdiction,” the court “found it useful to consider” FRCP Form 7, which illustrates the “simplicity and brevity” of pleading jurisdiction.  (Rule 84.)  The court recognized that Rule 84 and all the forms would be abrogated as of December 1 absent congressional action, however, and stated that it was not relying on them “in reaching our ultimate conclusion.”

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September 4, 2015 in Recent Decisions, Subject Matter Jurisdiction | Permalink | Comments (0)

Thursday, September 3, 2015

Free CLE for ABA Members: 2015-2016 Supreme Court Preview

The next in the American Bar Association’s free Continuing Legal Education for its members will be a program entitled Supreme Court Preview: The 2015-2016 Term.  The webinar will be on Monday, September 21, 2015, from 1:00 PM - 2:30 PM ET. 


The speaker will be Adam Liptak, Supreme Court Correspondent for the New York Times.


The program offers 1.5 hours of CLE credit.  It is free for ABA members and $195 for non-members. 

September 3, 2015 in Conferences/Symposia, Supreme Court Cases | Permalink | Comments (0)

Wednesday, September 2, 2015

Possible "Coming Liberal Disaster" on Class Actions, Too

Howard Bashman at How Appealing brought attention to a post by Jeffrey Toobin in The New Yorker about a possible upcoming “disaster” for liberals in the October 2015 term in the Supreme Court.  Mr. Toobin included affirmative action, abortion, and public-employee unions in “the subjects before the Justices [that] appear well suited for liberal defeats.” 


Mr. Toobin could also have included private-law class actions.  The Court has granted cert in four cases that could hobble class actions well before the Civil Rules Advisory Committee moves forward in its consideration of the topic.  As we’ve previously reported (but not all in one post, if memory serves), these four cases are:

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September 2, 2015 in Class Actions, In the News, Standing, Supreme Court Cases | Permalink | Comments (0)