Saturday, August 16, 2014
Stephen Burbank and Sean Farhang have posted on SSRN their article Federal Court Rulemaking and Litigation Reform: An Institutional Approach (forthcoming in Nevada Law Journal).
Since the bold rulemaking reforms of 1993 were very nearly blocked by Congress, it has seemed that the important lessons for some rulemakers had to do with the epistemic deficits or overreaching of proposed reforms, while for others the lessons focused attention on the locus of partisan control in Congress. The former group may have learned from the Court’s strategy of incrementalism – death by a thousand cuts – in litigation reform involving the interpretation of federal statutes. The latter group may regret, if not the loss of leadership in procedural lawmaking, then the loss of leadership in retrenchment, which some rulemaking critics have seen signaled in the Court’s recent use of decisions effectively to amend the Federal Rules.
Thursday, August 14, 2014
Echoing the May 2, 2014 Report to the Standing Committee by the Advisory Committee on Civil Rules, the chair of the Advisory Committee, Judge David G. Campbell, has signaled that he would adopt the position of the proposed change to FRCP 37(e). Vicente v. City of Prescott, No. CV–11–08204–PCT–DGC (D. Ariz. Aug. 8, 2014), 2014 WL 3894131.
The proposed amendment to Rule 37(e) provides:
If electronically stored information that should have been preserved in the anticipation or conduct of litigation is lost because a party failed to take reasonable steps to preserve it, and it cannot be restored or replaced through additional discovery, the court may:
(1) upon finding prejudice to another party from loss of the information, order measures no greater than necessary to cure the prejudice; or
(2) only upon finding that the party acted with the intent to deprive another party of the information’s use in the litigation:
(A) presume that the lost information was unfavorable to the party;
(B) instruct the jury that it may or must presume the information was unfavorable to the party; or
(C) dismiss the action or enter a default judgment.
Thus, the proposal rejects cases that permit an adverse inference instruction on a showing of negligence or gross negligence. As the Advisory Committee reported to the Standing Committee:
Circuits that permit adverse inference instructions on a showing of negligence or gross negligence adopt [the] rationale . . . that the adverse inference restores the evidentiary balance, and that the party that lost the information should bear the risk that it was unfavorable. See, e.g., Residential Funding Corp. v. DeGeorge Finan. Corp., 306 F.3d 99 (2d Cir. 2002). Although this approach has some logical appeal, the Advisory Committee has several concerns with this approach when applied to ESI. First, negligently lost information may have been favorable or unfavorable to the party that lost it. Consequently, an adverse inference may do far more than restore the evidentiary balance; it may tip the balance in ways the lost evidence never would have. (click here and go to page 314)
In Vicente, Judge Campbell stated that "the Court tends to believe that such an instruction requires a showing of bad faith," although the case did not require a decision on the point. (n. 10) Footnote 10 goes on to use the sentences quoted above almost verbatim, but without attribution.
Tuesday, August 12, 2014
Via our friends at the Drug and Device Law blog: Court Holds that Claim Against a Doctor Who Served as a Designer (or Possibly Just a Consultant) Can Defeat Diversity. From the post:
. . .
Now, the disconnect here may be that, even though federal, the court was not applying TwIqbal or anything resembling it. The court believed instead that it could not dismiss the doctor as fraudulently joined if there was “any possibility that plaintiff may prevail.” Id. at *5. That’s different from the TwIqbal standard, and we have addressed (here) that we believe federal courts considering fraudulent joinder should apply TwIqbal, or at least aTwIqbal-like standard. This court didn’t.
VANDERBILT LAW SCHOOL
CECIL D. BRANSTETTER LITIGATION & DISPUTE RESOLUTION PROGRAM
2015 NEW VOICES IN CIVIL JUSTICE SCHOLARSHIP WORKSHOP
CALL FOR PAPERS
Vanderbilt Law School’s Branstetter Litigation & Dispute Resolution Program invites submissions for its 2015 New Voices in Civil Justice Scholarship Workshop, to be held May 11-12, 2015, 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 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.
1. Subject matter. Submitted papers should address an aspect of civil justice, broadly defined. Subject areas may include, but are not limited to, civil procedure, complex litigation, evidence, federal courts, judicial decision-making, alternative dispute resolution, remedies, and conflict of laws. In keeping with the intellectual breadth of the Branstetter Program faculty, the Workshop welcomes all scholarly methodologies, from traditional doctrinal analysis to quantitative or experimental approaches.
2. Author qualifications. To be eligible to submit a paper, scholars must currently hold either a faculty position or a fellowship.
3. Format / Anonymity. We will consider preliminary drafts, drafts under submission, or accepted papers that will not be published by the time of the workshop. Papers should be formatted either in Microsoft Word or Adobe Acrobat. To maintain the anonymity of the process, please remove any self-identifying information from the submission.
4. Deadline. Submissions should be e-mailed to Branstetter.Program@vanderbilt.edu no later than January 1, 2015. Please include your name, current position, and contact information in the e-mail accompanying the submission. We will contact you with our decision by February 15. Final drafts are due no later than April 15.
The Branstetter Program will pay all reasonable travel expenses within the United States for invited participants. Additional information can be found at http://law.vanderbilt.edu/newvoices. If you have any questions, please email the New Voices Workshop Chair, Professor Erin O’Hara O’Connor.
NEW VOICES IN CIVIL JUSTICE SCHOLARSHIP WORKSHOP
Tara Grove, William & Mary Law School
Scott Dodson, UC Hastings College of Law
Hiro Aragaki, Loyola Law School of Los Angeles
Invited Senior Scholar: Tobias Wolff
Sergio Campos, University of Miami
Robin Effron, Brooklyn Law School
Christopher Robertson, University of Arizona
Invited Senior Scholars: Benjamin Spencer & Neil Vidmar
Elizabeth Chamblee Burch, University of Georgia
Christina Boyd, SUNY Buffalo
Alexandra Lahav, University of Connecticut School of Law
Ariana Levinson, University of Louisville-Brandeis School of Law
Corey Yung, University of Kansas
Invited Senior Scholars: Robert Bone, Myriam Gilles & Kevin Clermont
2011 (began as an annual event)
Nora Freeman Engstrom, Stanford Law School
Maria Glover, Georgetown Law School (then at Harvard Law School (Climenko Fellow))
Margaret Lemos, Duke Law School (then at Cardozo School of Law)
Jonathan Mitchell, George Mason University School of Law
Invited Senior Scholar: Jay Tidmarsh
Myriam Gilles, Cardozo School of Law
Donna Shestowsky, U.C. Davis School of Law
A. Benjamin Spencer, University of Virginia School of Law (then at University of Richmond)
Amanda Tyler, U. C. Berkeley School of Law (then at George Washington University Law School)
Tobias Wolff, University of Pennsylvania Law School (then at U.C. Davis School of Law)
Invited Senior Scholar: Catherine Struve
Thursday, August 7, 2014
In Walsh v. U.S. Bank, N.A., No. A13-0742 (Aug. 6, 2014), the Minnesota Supreme Court held:
[W]e now decline to engraft the plausibility standard from Twombly and Iqbal onto our traditional interpretation of Minn. R. Civ. P. 8.01. We decline to do so despite the fact that the relevant text of Fed. R. Civ. P. 8(a)(2) is identical to the text of Minn. R. Civ. P. 8.01. . .
. . . A claim is sufficient against a motion to dismiss for failure to state a claim if it is possible on any evidence which might be produced, consistent with the pleader’s theory, to grant the relief demanded.
Hat tip: James Pielemeier
Wednesday, August 6, 2014
Now, I know you were just sayng to yourself, "Why hasn't another article about the empirical study of Twombly and Iqbal come out recently? I'm having withdrawal symptoms." Rejoice -- here it is.
Professor Jonah Gelbach of the University of Pennsylvania Law School has published in the most recent issue of the Stanford Journal of Complex Litigation (and earlier posted on SSRN) his article Can the Dark Arts of the Dismal Science Shed Light on the Empirical Reality of Civil Procedure?
Empirical questions in civil procedure are too important to be answered as if motivated people weren’t involved in the legal system. Parties don’t conduct their primary behavior that way, lawyers don’t plead or brief that way, and judges don’t decide cases that way. We ought not to study litigation that way, either. This paper is a step toward a better alternative.
Empirical researchers must take seriously the fact that litigation involves human beings, who are motivated and have agency. To make this point concrete, I first step outside the realm of civil procedure and illustrate the importance of accounting for human agency in empirical research. I use the canonical problem of demand estimation in economics to show how what I call the “urn approach” to empirical work fails to uncover important empirical relationships by disregarding behavioral aspects of human action.
I then show how these concerns permeate a prominent empirical issue in contemporary civil procedure debates: the changes in pleading policy wrought by Bell Atlantic, Corp. v. Twombly and Ashcroft v. Iqbal. Revisiting my own earlier work, I embed the question of how changes in the pleading standard will affect case outcomes in a broad behavioral framework that takes parties’ agency seriously. In the process, I address recent critiques, both of the very idea of using behavioral frameworks to understand civil litigation policy changes, and of my use of real-world litigation data collected by the Federal Judicial Center. These criticisms implicate all aspects of the process of empirical research: the notion of using a behavioral framework at all, the type of data needed, and the question of how best to estimate effects that the behavioral framework indicates are important, given the data. As I show, these criticisms are straightforwardly (if verbosely) refuted on the merits.
The alternative to taking seriously the behavioral context created by the civil justice system — what has occurred so far in too much of the debate over Twombly and Iqbal — is, as one critic of early 20th-century empirical research by legal scholars once put it, “a mindless amassing of statistics without reference to any guiding theory whatsoever.” To do better, we will need to take behavior seriously in studying civil litigation.
Saturday, August 2, 2014
From the summary prepared by court staff of the Ninth Circuit:
Reversing the district court’s denial of a motion for a remand to state court, the panel held that neither the federal question statute nor the Class Action Fairness Act provided the district court with subject matter jurisdiction over the Hawaii Attorney General’s complaints against six credit card providers, alleging that each violated state law by deceptively marketing and improperly enrolling cardholders in add-on credit card products.
Joining the Fifth Circuit, the panel held that the Attorney General’s claims were not preempted by National Bank Act provisions completely preempting state law claims challenging interest rates charged by national banks. . . . [T]he complaints’ state law claims were not preempted because they did not challenge the “rate of interest” that the card providers charged. Instead, . . . the complaints’ unfair and deceptive practice claims targeted alleged marketing misrepresentations, and their unjust enrichment claims arose from the purported failure to obtain consent before enrolling consumers in debt protection products.
Agreeing with the Second, Third, and Fourth Circuits, the panel held that CAFA did not provide an alternate basis for jurisdiction because the Attorney General brought civil enforcement actions or common law parens patriae suits, rather than class actions, and the complaints specifically disclaimed class status.
State of Hawaii ex rel. Louie v. HSBC Bank Nevada, N.A., No. 1:12-cv-00266-LEKKSC (Aug. 1, 2014).
Thursday, July 31, 2014
A recent opinion from the California Court of Appeals perhaps illustrates the extent to which defendants have been emboldened by the United States Supreme Court's decision striking down personal jurisdiction in Daimler AG v. Bauman.
In Bristol-Myers Squibb Co. v. Superior Court of San Francisco County, No. A140035 (Cal. App. July 30, 2014), BMS filed a petition for writ of mandate to reverse the trial court's ruling upholding personal jurisdiction. The court set the scene:
Defendant Bristol-Myers Squibb Company (BMS) has been sued by dozens of California residents in a coordinated proceeding before the San Francisco Superior Court. They allege defects in Plavix, a drug BMS manufactures and sells throughout the country. Jurisdiction over BMS as to these plaintiffs is conceded. The question presented is whether California also has jurisdiction over BMS regarding identical Plavix defects claims brought by hundreds of non-resident co-plaintiffs, the real parties in interest here (RPI), in the same coordinated proceeding, consistent with the Due Process Clause of the Fourteenth Amendment.
The trial court had upheld general jurisdiction over the non-residents' claims against BMS because:
[I]t had sold in the state nearly $1 billion worth of Plavix between 2006 and 2012 and 196 million Plavix pills between 1998 and 2006, had been registered with the California Secretary of State to conduct business since 1936, maintained an agent for service of process in Los Angeles, operated five offices in California that employed approximately 164 people, employed approximately 250 in-state sales representatives, owned a facility in Milpitas employing 85 people that was used primarily for research, operated other facilities that were used primarily for research and laboratory activities in Aliso Viejo, San Diego and Sunnyvale, and had a small office in Sacramento that was used by the company’s Government Affairs group.
Despite these extensive contacts with California, the appellate court concluded that after Daimler, California could not exercise general jurisdiction over BMS because it was not "at home" in the forum.
All was not lost for the non-resident plaintiffs, however. Turning to specific jurisdiction, the court relied on Keeton v. Hustler Magazine to show that "the doctrine of specific jurisdiction can apply to the claims of a non-resident against a non-resident." Further, the court noted that although the United States Supreme Court has not yet defined "what it means for a suit to 'arise out of' or 'relate' to a defendant’s contacts with the State," California has adopted the “'substantial connection' test, under which the relatedness requirement is satisfied if 'there is a substantial nexus or connection between the defendant’s forum activities and the plaintiff’s claim.'”
The court held that there was a "substantial connection" between BMS' extensive contacts with California and the non-residents' claims of injury involving Plavix:
BMS has “deliberately exploited” the relevant market in the State (Keeton, supra, 465 U.S. at p. 781) for many years, having sold over 196 million Plavix pills in California between 1998 and 2006 and nearly $1 billion worth of Plavix between 2006 and 2012.
Further, plaintiffs allege BMS’s Plavix sales in California have led to injuries to California residents that are the same as those suffered by the RPI.
Finally, the court held that BMS had not satisfied its burden of showing that California's exercise of specific jurisdiction was unreasonable.
Hat tip: Levi Wilkes (St. Thomas J.D. Candidate 2015)
Wednesday, July 30, 2014
Roger Michalski (Brooklyn Law School) and Abby Wood (USC Gould School of Law) have posted Twombly and Iqbal at the State Level to SSRN.
This paper contributes to the empirical literature on pleading standards by studying the effect of Twombly and Iqbal at the state level. Studying pleading in the states is appealing for three reasons.
First, the findings of this paper are the first to address the empirical workings of pleading regimes where most litigation in the United States occurs. States account for the majority of civil litigation, yet they are understudied doctrinally and empirically. Here, we examine filing behavior, the content and length of complaints, the use of amended complaints, voluntary dismissals, motion to dismiss filed, and dismissal rates.
Second, federal civil procedures only vary across time. There is only one pre-Iqbal federal pleading regime and one post-Iqbal regime. When we consider pleading at the state level, we can leverage differences across space and time. When some states change pleading standards while others do not (as here), we are presented with a natural experiment on the effects of pleading standards ripe for empirical study.
Third, our focus on the state level allows us to introduce synthetic controls to the study of pleading. Using synthetic controls frees us from one of the basic vulnerabilities of using one specific state (or group of states) as a comparison category – the threat that the states are fundamentally different, and we are instead comparing apples and oranges. Synthetic controls allows us to construct a composite of states as a control state, which, by construction, is a close match to the treatment state.
Until now, we simply did not know whether the existing literature at the federal level analyzed an outlier jurisdiction or whether pleading functions similarly in both state and federal courts. This paper fills that gap and lays the groundwork for future empirical research on national procedural uniformity and divergence.
Saturday, July 26, 2014
My colleague Siegfried Wiessner, Professor of Law and the Director of St. Thomas' Graduate Program in Intercultural Human Rights, has posted on SSRN his article Democratizing International Arbitration? Mass Claims Proceedings in Abaclat v. Argentina. This is a fascinating account of the decision of the International Center for the Settlement of Investment Disputes to allow some 60,000 individual Italian bondholders to proceed against Argentina for its default on those bonds – the first mass claim presented before an ICSID tribunal. In support of the ICSID's decision, Professor Wiessner surveys US class action practice, the European Union's collective redress mechanisms (including representative collective actions, group actions, and test cases), and International Mass Claims Commissions.
Friday, July 25, 2014
In a 4-3 decision, the Wisconsin Supreme Court has adopted the plausibility pleading standard of the U.S. Supreme Court's opinion in Bell Atlantic Corp. v. Twombly. Data Key Partners v. Permira Advisers LLC, No. 2012AP1967 (Wis. July 23, 2014).
The court reversed the Wisconsin Court of Appeals' ruling that plaintiffs had alleged sufficient facts to show breach of fiduciary duty against the defendants. Wisconsin's pleading rule requires a complaint to contain "[a] short and plain statement of the claim, identifying the transaction or occurrence or series of transactions or occurrences out of which the claim arises and showing that the pleader is entitled to relief." Wis. Stat. § 802.02(1)(a).
The court held that "[p]laintiffs must allege facts that, if true, plausibly suggest a violation of applicable law," stating that "Twombly is consistent with our precedent." The court also asserted that Twombly had overruled Conley v. Gibson. (In my view, however, Twombly only overruled Conley's "no set of facts" standard, not the entire opinion.)
Justice Shirley Abramson, for two other justices, dissented.
I would follow Wisconsin law and conclude that as a general rule, parties need not plead specific facts at the motion-to-dismiss phase. In the instant case, although the plaintiffs raised the business judgment rule in their complaint, the plaintiffs also set forth sufficient facts to plead around the rule and provide notice to the defendants of the claim being alleged.
. . . Under Twombly/Iqbal, federal district courts have increased the rate at which they grant motions to dismiss.
No Wisconsin case has adopted the rule as stated in Twombly and Iqbal. Twombly was not argued or briefed in the instant case. The majority opinion relies on the Twombly heightened pleading standard without any briefing or argument. I have written before that this court should give counsel the opportunity to develop arguments before the court in the adversarial system. . . .
Wednesday, July 23, 2014
By now most folks have seen yesterday’s conflicting rulings over whether the Affordable Care Act authorizes subsidies for individuals who purchase insurance on a federal exchange (as opposed to exchanges run by the states). The D.C. Circuit found that such subsidies were not statutorily authorized (the Halbig case). And an hour later, the Fourth Circuit found that the subsidies were statutorily authorized (the King case).
The merits of these decisions, as a practical matter and in terms of statutory interpretation, have received tremendous attention. But Article III standing was also an issue in both Halbig and King. Who, after all, suffers the constitutionally required “injury in fact” by virtue of receiving a subsidy? The answer: People who would be subject to the individual mandate if they are entitled to the subsidy but would not be subject to the individual mandate (on income grounds) without the subsidy. Here’s how the Halbig majority explained it with respect to one of the plaintiffs in that case, David Klemencic:
Klemencic resides in West Virginia, a state that did not establish its own Exchange, and expects to earn approximately $20,000 this year. He avers that he does not wish to purchase health insurance and that, but for federal credits, he would be exempt from the individual mandate because the unsubsidized cost of coverage would exceed eight percent of his income. The availability of credits on West Virginia’s federal Exchange therefore confronts Klemencic with a choice he’d rather avoid: purchase health insurance at a subsidized cost of less than $21 per year or pay a somewhat greater tax penalty.
The D.C. Circuit found that this was sufficient for purposes of Article III standing, and the Fourth Circuit reached the same conclusion. From the Halbig majority opinion (footnote omitted):
The government characterizes Klemencic’s injury as purely ideological and hence neither concrete nor particularized. But, although Klemencic admits to being at least partly motivated by opposition to “government handouts,” he has established that, by making subsidies available in West Virginia, the IRS Rule will have quantifiable economic consequences particular to him. See Clapper v. Amnesty Int’l USA, 133 S. Ct. 1138, 1147 (2013) (explaining that a “threatened injury” that is “certainly impending” may “constitute injury in fact” (emphasis and internal quotation marks omitted)). Those consequences may be small, but even an “‘identifiable trifle’” of harm may establish standing. Chevron Natural Gas v. FERC, 199 F. App’x 2, 4 (D.C. Cir. 2006) (quoting United States v. Students Challenging Regulatory Agency Procedures, 412 U.S. 669, 689 n.14 (1973)); see Bob Jones Univ. v. United States, 461 U.S. 574, 581-82 (1983) (noting that Bob Jones University sued for a tax refund of $21.00). Klemencic thus satisfies the requirement of establishing an injury in fact, and because that injury is traceable to the IRS Rule and redressable through a judicial decision invalidating the rule, we find that he has standing to challenge the rule.
And from the King opinion:
We agree that this represents a concrete economic injury that is directly traceable to the IRS Rule. The IRS Rule forces the plaintiffs to purchase a product they otherwise would not, at an expense to them, or to pay the tax penalty for failing to comply with the individual mandate, also subjecting them to some financial cost. Although it is counterintuitive, the tax credits, working in tandem with the Act’s individual mandate, impose a financial burden on the plaintiffs.
The defendants’ argument against standing is premised on the claim that the plaintiffs want to purchase “catastrophic” insurance coverage, which in some cases is more expensive than subsidized comprehensive coverage required by the Act. The defendants thus claim that the plaintiffs have acknowledged they would actually expend more money on a separate policy even if they were eligible for the credits. Regardless of the viability of this argument, it rests on an incorrect premise. The defendants misread the plaintiffs’ complaint, which, while mentioning the possibility that several of the plaintiffs wish to purchase catastrophic coverage, also clearly alleges that each plaintiff does not want to buy comprehensive, ACA-compliant coverage and is harmed by having to do so or pay a penalty. The harm in this case is having to choose between ACA-compliant coverage and the penalty, both of which represent a financial cost to the plaintiffs. That harm is actual or imminent, and is directly traceable to the IRS Rule.
Friday, July 18, 2014
The ABA is presenting a free (to members) Webinar called "The Mobile Transformation: The Extraordinary Legal Implications of Billions of Mobile Devices" on Monday, July 21, 2014 from 1:00-2:30 p.m.
Information on the Webinar is here.
Monday, July 7, 2014
The Civil Procedure Section of the AALS will present a panel, “The Rising Bar to Federal Courts: Beyond Pleading and Discovery,” at the 2015 AALS Annual Meeting in Washington, D.C. The panel will run from 10:30 a.m. to 12:15 p.m. on Saturday, January 3, 2015, at the Washington Marriott Wardman Park Hotel. This panel brings together a group of people with different roles and perspectives to provide insights and commentary on the effects of civil procedure rules and doctrine on the current federal court docket. Confirmed outside speakers include a United States District Court judge, an empirical researcher from the Federal Judicial Center, a plaintiffs’ side attorney, and a lawyer from the defense bar.
The Section seeks 1-2 academic speakers/papers for further perspective on how developments in rules and case law are acting at the federal trial court level to affect and restrict the nature of the court docket. While tremendous attention has been given to Twombly/Iqbal and discovery rules, our panel seeks to go beyond these two “usual suspects” to focus on other developments in doctrine and rulemaking that also alter the potential for court access, including, but not limited to, issues around personal jurisdiction, mandatory ADR, transnational litigation, and class actions.
The selected author(s) will present their papers at the AALS annual meeting in January 2015 in Washington, D.C. Neither the AALS nor the Section is able to provide travel funding. The selected authors and all panelists will have the opportunity to publish their papers in the Journal of Civil Rights and Economic Development (St. John’s Law School), subject to final approval by the journal editors.
All draft papers must be submitted by Tuesday, September 2, 2014. Please send submissions to Rebecca Hollander-Blumoff, Chair of the Section on Civil Procedure, by email to email@example.com. Respondents will be notified of the Section’s decision by the end of September.
Thursday, July 3, 2014
(1) Whether the Trademark Trial and Appeal Board’s finding of a likelihood of confusion precludes respondent from relitigating that issue in infringement litigation, in which likelihood of confusion is an element; and (2) whether, if issue preclusion does not apply, the district court was obliged to defer to the Board’s finding of a likelihood of confusion absent strong evidence to rebut it.
Hat tip: Professor Ira Nathenson, who also explained that the Trademark Trial and Appeal Board is not an Article III court, and that the nature of Likelihood-of-Confusion inquiries can vary between the TTAB and the District Court.
Tuesday, July 1, 2014
The opinion by Judge Keenan in Al Shimari v. CACI Premier Technology, Inc., No. 13-1937 (4th Cir. June 30, 2014) sums it up:
In this appeal, we consider whether a federal district court has subject matter jurisdiction to consider certain civil claims seeking damages against an American corporation for the torture and mistreatment of foreign nationals at the Abu Ghraib prison in Iraq. The primary issue on appeal concerns whether the Alien Tort Statute, 28 U.S.C. § 1350, as interpreted by the Supreme Court in Kiobel v. Royal Dutch Petroleum Co., 133 S. Ct. 1659 (2013), provides a jurisdictional basis for the plaintiffs’ alleged violations of international law, despite the presumption against extraterritorial application of acts of Congress. We also address the defendants’ contention that the case presents a “political question” that is inappropriate for judicial resolution under our decision in Taylor v. Kellogg Brown & Root Services, Inc., 658 F.3d 402 (4th Cir. 2011).
We conclude that the Supreme Court’s decision in Kiobel does not foreclose the plaintiffs’ claims under the Alien Tort Statute, and that the district court erred in reaching a contrary conclusion. Upon applying the fact-based inquiry articulated by the Supreme Court in Kiobel, we hold that the plaintiffs’ claims “touch and concern” the territory of the United States with sufficient force to displace the presumption against extraterritorial application of the Alien Tort Statute. See Kiobel, 133 S. Ct. at 1669. However, we are unable to determine from the present record whether the claims before us present nonjusticiable political questions. Therefore, we do not reach the additional issue of the district court’s dismissal of the plaintiffs’ common law claims, and we vacate the district court’s judgment with respect to all the plaintiffs’ claims and remand the case to the district court. We direct that the district court undertake factual development of the record and analyze its subject matter jurisdiction in light of our decision in Taylor and the principles expressed in this opinion.
Congratulations to Civil Procedure Professors Erwin Chemerinsky, Helen Hershkoff, Allan Paul Ides, Stephen I. Vladeck, and Howard M. Wasserman, who submitted an amicus brief on behalf of the plaintiffs-appellants.
Monday, June 30, 2014
While everyone waits with bated breath for the Supreme Court to wrap up the current Term with decisions in Hobby Lobby and Harris, the Court granted certiorari in Gelboim v. Bank of America (No. 13-1174). From the cert petition, here is the question presented (with the usual wind-up):
The question “whether consolidated cases retain their separate identity or become one case for purposes of appellate jurisdiction has divided the courts of appeals.” United States ex rel. Hampton v. Columbia/HCA Healthcare Corp., 318 F.3d 214, 216 (D.C. Cir. 2003). “Some circuits hold that consolidated cases remain separate actions and no Rule 54(b) certification is needed to appeal the dismissal of any one of them. Others treat consolidated cases as a single action, or presume that they are, allowing the presumption to be overcome in highly unusual circumstances. Still other circuits apply no hard and fast rule, but focus on the reasons for the consolidation to determine whether the actions are one or separate.” Id. (citations and alterations omitted). This Court granted certiorari to resolve the conflict in Erickson v. Maine Central Railroad Co., 111 S. Ct. 38 (1990) (mem.), but the petition was subsequently dismissed, 111 S. Ct. 662 (1990) (mem.).
The Question Presented is:
Whether and in what circumstances is the dismissal of an action that has been consolidated with other suits immediately appealable?
Saturday, June 28, 2014
Plaintiff Barko worked for Kellogg Brown & Root, a defense contractor and former subsidiary of Halliburton. He filed a False Claims Act claim against KBR:
In essence, Barko alleged that KBR and certain subcontractors defrauded the U.S. Government by inflating costs and accepting kickbacks while administering military contracts in wartime Iraq. During discovery, Barko sought documents related to KBR’s prior internal investigation into the alleged fraud. KBR had conducted that internal investigation pursuant to its Code of Business Conduct, which is overseen by the company’s Law Department.
KBR argued that the internal investigation had been conducted for the purpose of obtaining legal advice and that the internal investigation documents therefore were protected by the attorney-client privilege. . . .
After reviewing the disputed documents in camera, the District Court determined that the attorney-client privilege protection did not apply because, among other reasons, KBR had not shown that “the communication would not have been made ‘but for’ the fact that legal advice was sought.” . . . KBR’s internal investigation, the court concluded, was “undertaken pursuant to regulatory law and corporate policy rather than for the purpose of obtaining legal advice.”
. . . The District Court . . . ordered KBR to produce the disputed documents to Barko . . .
The D.C. Circuit granted KBR's petition for writ of mandamus, holding that the District Court's privilege ruling was clearly legally erroneous under Upjohn v. United States, and that it was otherwise appropriate to grant the writ:
[T]he District Court also distinguished Upjohn on the ground that KBR’s internal investigation was undertaken to comply with Department of Defense regulations that require defense contractors such as KBR to maintain compliance programs and conduct internal investigations into allegations of potential wrongdoing. The District Court therefore concluded that the purpose of KBR’s internal investigation was to comply with those regulatory requirements rather than to obtain or provide legal advice. In our view, the District Court’s analysis rested on a false dichotomy. So long as obtaining or providing legal advice was one of the significant purposes of the internal investigation, the attorney-client privilege applies, even if there were also other purposes for the investigation and even if the investigation was mandated by regulation rather than simply an exercise of company discretion.
The D.C. Circuit rejected KBR's request to reassign the case to a different District Judge. In re Kellogg Brown & Root, Inc., No. 14-5055 (D.C. Cir. June 27, 2014).
Tuesday, June 24, 2014
In the latest Supreme Court round of Halliburton Co. v. Erica P. John Fund, Inc., the Court declined Halliburton's invitation to overrule Basic v. Levinson, but remanded to allow Halliburton, at the class certification stage, to attempt to rebut the presumption that the alleged misrepresentations actually affected the price of the stock. The Court's final two paragraphs:
More than 25 years ago [in Basic], we held that plaintiffs could satisfy the reliance element of the Rule 10b–5 cause of action by invoking a presumption that a public, material misrepresentation will distort the price of stock traded in an efficient market, and that anyone who purchases the stock at the market price may be considered to have done so in reliance on the misrepresentation. We adhere to that decision and decline to modify the prerequisites for invoking the presumption of reliance. But to maintain the consistency of the presumption with the class certificationrequirements of Federal Rule of Civil Procedure 23, defendants must be afforded an opportunity before class certification to defeat the presumption through evidencethat an alleged misrepresentation did not actually affect the market price of the stock.
Because the courts below denied Halliburton that opportunity, we vacate the judgment of the Court of Appeals for the Fifth Circuit and remand the case for further proceedings consistent with this opinion.
Some coverage of the case:
Monday, June 23, 2014
Paula Schaefer of the University of Tennessee College of Law has posted on SSRN her article, A Primer on Professionalism for Doctrinal Professors, forthcoming in Tennessee Law Review.
Legal education reform advocates agree that law schools should integrate “professionalism” throughout the curriculum. Ultimately, it falls to individual professors to decide how to incorporate professionalism into each course. This can be an especially difficult task for doctrinal professors. The law — and not the practice of law — is the focus of most doctrinal casebooks. Law students typically do not act in role as lawyers in these classes, so they are not compelled to resolve professional dilemmas in class, as students would be in a clinic or simulation-based course. As a result, it takes some additional preparation and thought to introduce professionalism issues into these courses. Some professors may resist making this change — not knowing which aspect or aspects of professionalism should be the focus, fearing that time spent on professionalism will detract from the real subject matter of the class, or believing professionalism is adequately covered elsewhere in the curriculum.
This Article considers how and why doctrinal professors should address the challenge of integrating professionalism into the classroom. Part I briefly discusses the multitude of meanings ascribed to attorney professionalism and argues that the lack of a clear, concise, and shared definition is a substantial barrier to effectively incorporating professionalism into the law school curriculum. Next, Part II provides a more coherent, streamlined definition of attorney professionalism. This Part also identifies and describes three primary aspects of lawyer professionalism: fulfilling duties to clients, satisfying duties to the bar, and possessing core personal values essential to being a good lawyer. This simplified conception of professionalism should begin to address the concerns of professors who do not know where to begin to incorporate professionalism into their classes. It is also intended to persuade skeptics that professionalism is something they can and should teach as part of their doctrinal classes.
Thereafter, Part III provides guidance for developing course outcomes that connect course subject matter and professionalism. Questions prompt doctrinal professors to look for the natural connections between their course subject matter and issues of professionalism. Then, Part IV considers various methods doctrinal professors can use to introduce professionalism topics into their courses. Integrating professionalism into the classroom does not require professors to abandon their casebooks; using case law can be an effective method. This Part also considers other teaching methods and materials for combining doctrine, skills, and professionalism. Finally, Part V concludes with thoughts on how students benefit when professors make the effort to incorporate professionalism into every law school classroom.