Civil Procedure & Federal Courts Blog

SCOTUS Approves Amendments to Federal Rules of Civil Procedure

This week the Supreme Court approved amendments to Federal Rules of Civil Procedure 8, 26, and 56, and Illustrative Form 52 and transmitted them to Congress. The amendments were approved by the Judicial Conference of the United States last fall (as covered earlier here).

Absent congressional intervention, the amendments will become effective on Dec. 1, 2010.

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(Hat Tip: Brad Shannon)

Decision of Interest: Deadline to Appeal When a Post-Judgment Motion is Withdrawn

Howard Bashman at How Appealing reports this week on the Tenth Circuit's decision in Vanderwerf v. SmithKline Beecham Corp. (No. 08-3218), a case involving the defendant’s drug Paxil. After the district court granted summary judgment for the defendant, the plaintiffs filed a timely motion to reconsider under FRCP 59. That motion remained pending for seven months, at which point the plaintiffs withdrew the motion and filed a notice of appeal that same day.

Ordinarily, filing a timely Rule 59 motion tolls the 30-day deadline to file a notice appeal. See Fed. R. App. P. 4(a)(4). In a 2-1 decision, the Tenth Circuit in Vanderwerf holds that this tolling occurs only when the district court “ent[ers] an order” disposing of the post-judgment motion. The 30-day deadline is not tolled when a party voluntarily withdraws the post-judgment motion. Thus, the Vanderwerfs’ notice of appeal was untimely, having been filed seven months after final judgment was entered. The majority wrote: "Although we note that there is no suggestion that the Vanderwerfs acted in bad faith, we are hamstrung by the mandatory procedural rules," which must be "strictly construe[d]." It concluded:

"We recognize the severity of today’s holding, and empathize with the plight of parties who are effectively prohibited from filing a notice of appeal because of the inaction of a district court. But we must rely upon the unambiguous standard we have consistently applied to the timeliness requirements of Rule 4. Quite simply, the time to file an appeal in a civil case is tolled by the timely filing of a motion listed in Rule 4(a)(4)(A), and begins to run anew from the entry of the order disposing of the last such remaining motion."

The dissenting judge disagreed with the majority’s interpretation and argued that the majority’s approach is in tension with decisions from other circuits, e.g., United States v. Rodriguez, 892 F.2d 233 (2d Cir. 1989), and Brae Transportation, Inc. v. Coopers & Lybrand, 790 F.2d 1439 (1986).

The decision in Vanderwerf is available here, at 2010 WL 1673114, or at 2010 U.S. App. LEXIS 8703.

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Collins on Public Funding of Litigation in England

Professor David Collins (The City Law School of City University London) has posted "Public Funding of Multi-Party Litigation" on SSRN.  It will be published in the Manitoba Law Journal.

The abstract states:

This paper examines some high profile publicly funded multiparty claims in England which resulted in large scale wastes of resources due to inadequate screening by the Legal Services Commission and its predecessor. This paper observes the cost-raising self-interested behaviour of solicitors and claimants funded by legal aid where there is no risk of an adverse decision. This paper suggests that a public interest litigation fund be established for group claims in England similar to that of the class action fund maintained by the Canadian province of Ontario. This should support claims that have a broader interest to society while limiting the legal aid budget's exposure to costs through unmeritorious lawsuits.

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Davis and Cramer on Class Certification in Antitrust Cases

Professor Joshua P. Davis (University of San Francisco School of Law) and Eric L. Cramer (Berger & Montague) have posted "Antitrust, Class Certification, and the Politics of Procedure" on SSRN. It will be published in the George Mason Law Review.

The abstract states:

This Article develops two arguments against a possible trend in federal appellate courts toward imposing a new, heightened standard for class certification in antitrust cases. Recent case law can be read to imply that trial judges may make findings of fact on the merits in deciding class certification, including about whether plaintiffs will be able to show with class-wide evidence that every class member was harmed by allegedly anticompetitive conduct. The first argument is that the potential new standard would require a showing at class certification on an issue – whether all class members were injured – that plaintiffs need not, and typically do not, address at trial. Under the traditional understanding of Rule 23, and specifically the predominance prong of Rule 23(b)(3), requiring plaintiffs to show they can prove something with class-wide evidence that they need not prove on the merits is artificial and conflicts with the logic of class certification. The second argument is that courts applying the potential new standard may find facts in a way that violates the Seventh Amendment. The avowed policy rationale behind this possible legal innovation is a concern that class certification coerces large corporate defendants into settling meritless cases, a concern that finds an insufficient basis in theory or empirical evidence. Without that basis, courts risk distorting class certification law and Seventh Amendment doctrine in a way that is political in the pejorative sense.

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Legal Fees in Spain

Anna Gines i Fabrellas and Ignacio Marin Garcia have posted Who Pays the Legal Fees in the Spanish Justice System? A Comparative Analysis of Civil and Labour Jurisdictions to SSRN.

Abstract:     
This paper compares the legal fees rules in the first instance civil and labour courts in Spain. Governed by substantially different legal fees rules, the paper analyses their effects on the litigation level and the probability of settlement in order to depict an institutional design which favours settlement and avoids excessive litigation.

RJE

SCOTUS Decision in Stolt-Nielsen v. AnimalFeeds: Arbitration and Class Actions

Today the Supreme Court decided Stolt-Nielsen S.A. v. AnimalFeeds International Corp., 08-1198, which addresses "whether imposing class arbitration on parties whose arbitration clauses are 'silent' on that issue is consistent with the Federal Arbitration Act (FAA)." The Court split 5-3, with Justice Alito writing for the majority, Justice Ginsburg writing for the dissent, and Justice Sotomayor taking no part.

Here are some excerpts from Justice Alito's majority opinion:

"While the interpretation of an arbitration agreement is generally a matter of state law, the FAA imposes certain rules of fundamental importance, including the basic precept that arbitration 'is a matter of consent, not coercion.' ...

"[A] party may not be compelled under the FAA to submit to class arbitration unless there is a contractual basis for concluding that the party agreed to do so. ...

"Here, where the parties stipulated that there was 'no agreement' on this question, it follows that the parties cannot be compelled to submit their dispute to class arbitration."

Justice Ginsburg's dissenting opinion begins:

"When an arbitration clause is silent on the question, may arbitration proceed on behalf of a class? The Court prematurely takes up that important question and, indulging in de novo review, overturns the ruling of experienced arbitrators."

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9th Circuit greenlights Class Action Trial Against Wal-Mart

The L.A. Times reports here.

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SCOTUS Cert. Grant on Post-Trial Appeals of Summary Judgment Denials (Ortiz v. Jordan)

The Supreme Court granted certiorari today in Ortiz v. Jordan (No. 09-737), which presents the following question: "May a party appeal an order denying summary judgment after a full trial on the merits if the party chose not to appeal the order before trial?"

(It appears that the defendants' summary judgment motion was based on qualified immunity, which means they could have sought an appeal prior to trial via the collateral order doctrine.)

Links to the docket, filings, and the Sixth Circuit's opinion are available at SCOTUSblog. For additional coverage, see U.S. Law Week's Supreme Court Today.

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Hot Off The Presses: Recent Articles of Interest

With hat tip to the Current Index of Legal Periodicals, here are some recent articles that may be of interest:

Hannah L. Buxbaum, Earl A. Snyder Lecture in International Law, National Jurisdiction and Global Business Networks, 17 Ind. J. Global Legal Stud. 165 (2010)

Maxine D. Goodman, A Hedgehog on the Witness Stand--What's the Big Idea?: The Challenges of Using Daubert to Assess Social Science and Nonscientific Testimony, 59 Am. U. L. Rev. 635 (2010)

Patricia W. Hatamyar, The Tao of Pleading: Do Twombly and Iqbal Matter Empirically? 59 Am. U. L. Rev. 553 (2010)

Emily Kadens, Justice Blackstone's Common Law Orthodoxy, 103 Nw. U. L. Rev. 1553 (2009)

Robert D. Peltz & Robert C. Weill, Corporate Representative Depositions: In Search of a Cohesive and Well-Defined Body of Law, 33 Nova L. Rev. 393 (2009)

Jacob B. Beausay, Comment, A Rogue Rule?: An Expose on the Unresolved Issues and Needless Litigation Created by Ohio's Affidavit of Merit Rule, 37 Cap. U. L. Rev. 1155 (2009)

Thomas J. Forr, Comment, Want Less Ideology on the Federal Bench? Pay Judges More, 158 U. Pa. L. Rev. 859 (2010)

Victor Petrescu, Note, Crash and Burn: Taylor v. Sturgell's Radical Redefinition of the Virtual Representation Doctrine, 64 U. Miami L. Rev. 735 (2010)

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Copeland on Mediating Judicial Interaction in a Federal Regime

Charleton C. Copeland (University of Miami School of Law) has posted Federalism's Duty: Mediating Judicial Interaction in a Federal Regime to SSRN.

Abstract:

This article argues that this "middle path" represents a particular model of federalism enforcement-relational federalism enforcement. Relational federalism enforcement is the judicial mediation of the interaction of the national government and state governments that goes beyond merely invalidating particular practices as beyond the scope of power a particular institutional actor. Rather relational federalism enforcement imposes behavioral norms on both states and the national government as consistent with the enduring nature of their interaction under the constitutional structure of federal. In the 2008 term, the United States Supreme Court decided Haywood v. Drown, which dealt with the preemption of NY state judicial procedures related to damage actions against corrections officers. In the article, I argue that the Court's case law related to the preemption of state procedural rules is an important example of relational federalism enforcement. The article provides an overview of the theory of relational federalism, defends the practice of judicial mediation of the national state relationship through the creation of federalism-inspired rules of interaction, situates judicial mediation within a larger context of other federal courts doctrine (abstention and adequate state grounds doctrine), and critiques the Court's decision to preempt NY procedural rules in light of the theory of relational federalism. The Article takes issue with the Court's reasoning in Haywood, whose analytical framework fails to take state interests into account in deciding to preempt state law.

RJE

Glashausser on the Exceptions Clause

Associate Dean Alex Glashausser (Washburn University School of Law) posted "A Return to Form for the Exceptions Clause" on SSRN. It will be published in the Boston College Law Review.

The abstract states:

This article challenges the prevailing doctrinal, political, and academic view that the Exceptions Clause – which provides that “the supreme Court shall have appellate Jurisdiction, both as to Law and Fact, with such Exceptions, and under such Regulations as the Congress shall make” – gives Congress a license to strip the Supreme Court of jurisdiction. Properly interpreted, the facially ambiguous clause instead allows Congress to shift cases within the Court’s jurisdiction from appellate to original form. The word “Exceptions,” that is to say, applies not to “Jurisdiction” but rather to “appellate.”

In its initial draft, the clause unmistakably affected only the form, not the existence, of jurisdiction: “[T]his supreme jurisdiction shall be appellate only, except in those instances, in which the legislature shall make it original . . . .” The article traces the devolution of that clear language into the final nebulous version, explaining at each step of the editing process why the Constitutional Convention delegates tinkered with the wording. As a result of what they thought were innocuous changes, the legislative exceptions power became susceptible to the misconception that it was confiscatory. It was meant to be transformative, allowing Congress to empower the Supreme Court by shifting important cases from appellate to original form. In short, the clause was designed not to eliminate cases, but to expedite them.

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Iqbal and the SEC's Case Against Goldman Sachs

As covered earlier here, an SEC civil action against defendants who were allegedly involved in the Bernie Madoff ponzi scheme was recently dismissed for failing to satisfy federal pleading standards. (See SEC v. Cohmad Securities Corp., No. 09-CV-5680, 2010 WL 363844, 2010 U.S. Dist. LEXIS 8597.)

Over at The Conglomerate, Prof. Christine Hurt (Illinois) asks whether this week's SEC action against Goldman Sachs might meet a similar fate. Noting the Cohmad court's reliance on Iqbal, she writes:

"[W]e always thought the SEC had it easier than private plaintiffs because it could bring actions against aiders and abetters and didn't have to deal with pleading requirements of the PSLRA. I guess Iqbal somehow levels that playing field, although possibly not in the right direction.

"The Cohmad case seemed to be the easiest case to bring, and maybe it would have been for the DOJ, who operates under different and sometimes easier rules for securities cases than civil rules. Judge Stanton did dismiss without prejudice with leave to replead for 30 days, but that deadline passed over a month ago.

"So, will the Goldman complaint survive the inevitable Motion to Dismiss?"

We'll find out soon enough. No doubt the attorneys for Goldman Sachs and Fabrice Tourre are preparing their 12(b)(6) motions as we speak.

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SCOTUS Oral Argument in Krupski v. Costa Crociere

We covered earlier the cert. grant in Krupski v. Costa Crociere, S.p.A., No. 09-337, a case involving the relation-back provision of FRCP 15(c)(1). The transcript from yesterday's much-anticipated oral argument is available here.

A central issue in the case is Rule 15(c)(1)(C)'s requirement of a "mistake concerning the proper party's identity." On what qualifies as a "mistake," the argument includes this priceless exchange involving Justice Breyer and Justice Scalia:

JUSTICE BREYER: Have you ever driven a car where your wife has said turn left and you have turned right?

(Laughter.)

JUSTICE BREYER: Has that ever happened to you?

MR. GLAZIER: Yes.

. . .

JUSTICE BREYER: . . . Did you do it by mistake? Yes, of course, you did. It's happened to every human being. There are millions of instances in which people do things by mistake where, in fact -

JUSTICE SCALIA: I think your wife made a mistake. I don't think you made a mistake.

(Laughter.)

JUSTICE BREYER: No, my wife does not make mistakes.

(Laughter.)

For additional coverage of the Krupski argument, see Blog of the Legal Times (Justice Breyer: My Wife is Infallible) and PrawfsBlawg (Justices struggle with civil procedure). 

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Toyota Litigation: Initial Counsel Assignments Made and Conference Set

The BNA reports that Judge Selna of the C.D. California has set an initial conference for May 13 for the cases currently consolidated as In re Toyota Motor Corp. Unintended Acceleration Marketing, Sales Practices, and Products Liability Litigation.  The court also made an interim assignment of lead counsel., choosing Steve W. Berman of Hagens Berman Sobol Shapiro in Seattle; Elizabeth J. Cabraser of Lieff Cabraser Heimann & Bernstein in San Francisco; and Marc M. Seltzer of Susman Godfey in Los Angeles for the plaintiffs.  Alston & Byrd of Atlanta represent Toyota.

RJE

Robertson on Transnational Litigation and Institutional Choice

Professor Cassandra Burke Robertson (Case Western Reserve University School of Law) has posted "Transnational Litigation and Institutional Choice" on SSRN.  It will be published in the Boston College Law Review.

The abstract states:

When U.S. corporations cause harm abroad, should foreign plaintiffs be allowed to sue in the United States? Federal courts are increasingly saying no. The courts have expanded the doctrines of forum non conveniens and prudential standing to dismiss a growing number of transnational cases. This restriction of court access has sparked considerable tension in international relations, as a number of other nations view such dismissals as an attempt to insulate U.S. corporations from liability. A growing number of countries have responded by enacting retaliatory legislation that may ultimately harm U.S. interests. This article argues that the judiciary’s restriction of access to federal courts ignores important foreign relations, trade, and regulatory considerations. The article applies institutional choice theory to recommend a process by which the three branches of government can work together to establish a more coherent court-access policy for transnational cases.

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Pettigrew and Stras on Fourth Circuit Caseload

Shaun Pettigrew and David Stras (University of Minnesota Law School) have posted The Rising Caseload in the Fourth Circuit: A Statistical and Institutional Analysis to SSRN.

Abstract:     
This symposium essay explores the transformation of the federal appellate courts through the lens of the United States Court of Appeals for the Fourth Circuit. Nationwide, circuit courts have experienced rapidly expanding dockets, which by necessity has led to a transformation in the way these courts conduct their business. For instance, the average active circuit judge in the Fourth Circuit now hears more than twice as many appeals as in 1979.

These crushing caseloads have led to a variety of reform measures, only some of which are transparent. For instance, the percentage of cases terminated on the merits following oral argument has plummeted from 95 percent of cases in the Fourth Circuit in 1979 to a modern low of just 12 percent in 2006. Similarly, the percentage of cases decided through published opinions has decreased by more than 50% since 1989. In addition to procedural reforms, the Fourth Circuit has dramatically increased the number of staff attorneys to handle routine cases that are decided without oral argument. These reforms, plus others, are critically examined in this Essay.

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Borchers on Punitive Damages, Forum Shopping, and Conflict of Laws

Professor Patrick Joseph Borchers (Creighton University School of Law) has posted "Punitive Damages, Forum Shopping, and Conflict of Laws" on SSRN. It will be published in the Louisiana Law Review.

The abstract states:

Few issues have as profound an impact on civil litigation as the availability and dimensions of punitive damages. States, however, vary considerably on whether punitive damages are allowed, the quantum and burden of proof necessary to establish liability for them, their insurability and the standard of appellate review of their award. Because of the high stakes involved, all three of the traditional branches of the discipline of the conflict of laws -- jurisdiction, choice of law and judgment recognition -- are directly involved. Civil plaintiffs naturally seek to find courts that will be hospitable to their attempted assertion of punitive damage liability and civil defendants are equally anxious to avoid such courts. The practice of attempting to find a friendly court is known colloquially as "forum shopping." This article examines how the branches of the conflict of laws are implicated in this high stakes battle and also examines what implications the Supreme Court's decision in State Farm Mutual Automobile Insurance Co. v. Campbell, 538 U.S. 408 (2003) has for conflicts issues in the punitive damage wars.

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Hot Off The Presses: Recent Articles Of Interest

With hat tip to the Current Index of Legal Periodicals, here are some recent articles that may be of interest: 

Kristen M. Blankley, Emily E. Root & John Minter, Multijurisdictional ADR Practice: Lessons from Litigators, 11 Cardozo J. Conflict Resol. 29 (2009)

 

Eleanor M. Fox, Modernization of Effects of Jurisdiction: From Hands-Off to Hands-Linked, 42 N.Y.U. J. Int'l L. & Pol. 159 (2009)

 

Sue Ann Mota, Federal Pre-emption After Medtronic, Altria Group, and Wyeth, 35 Okla. City U. L. Rev. 147 (2010)

 

Jennifer E. Spreng & Roberto J. Escobar, Solving "the Burklow Problem": Federal Question Jurisdiction of Tucker Act and Labor-Management Relations Act Cases After Textron Lycoming v. UAW, 55 Wayne L. Rev. 941-1005 (2009).

 

Peter D. Trooboff, Proposed Principles for United States Implementation of the New Hague Convention on Choice of Court Agreements, 42 N.Y.U. J. Int'l L. & Pol. 237-251 (2009)

 

Richard C. Worf, Jr,, The Effect of State Law on the Judge-Jury Relationship in Federal Court, 30 N. Ill. U. L. Rev. 109 (2009)

 

Symposium. Caperton v. A.T. Massey Coal Co. Foreword by Dahlia Lithwick; articles by Steven Lubet, Bruce A. Green, Elizabeth B. Wydra, Ronald D. Rotunda, Andrew L. Frey, Jeffrey A. Berger, James Sample, James Bopp, Jr. and Anita Y. Woudenberg; response by Roy A. Schotland, 60 Syracuse L. Rev. 215-346 (2010)

 

Anthony Francis Bruno, Note, Preserving Attorney-Client Privilege in the Age of Electronic Discovery, 54 N.Y.L. Sch. L. Rev. 541 (2009/10)

 

Jeremy D. Kerman, Note, Righting the Notice Pleading Ship: How Erickson v. Pardus Solidifies the Modern Supreme Court Trend of Notice-Giving in Light of Bell Atlantic Corporation v. Twombly, 84 Chi.-Kent. L. Rev. 691-710 (2009)

 

Gary W. Thompson, Note, Grappling with Grable in Singh v. Duane Morris, LLP: A Practical Guide for Practitioners Who Litigate State Causes of Action with Embedded Federal Issues in the Fifth Circuit, 29 Miss. C.L. Rev. 281-312 (2010).

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Not Done Yet: More Words From The Supreme Court On Shady Grove

Today the Supreme Court issued a "GVR" order (grant/vacate/remand) in Holster v. Gatco, Inc. (No. 08-1307), a case out of the Second Circuit. The Court remanded for further reconsideration in light of last month's decision in Shady Grove v. Allstate (covered here). Both Holster and Shady Grove involve the relevance in federal court of New York's § 901(b), which prohibits the award of certain statutory-damages remedies in class actions.

Today's GVR order prompted a dissent from Justice Ginsburg that was joined by Justice Breyer (two of the four Shady Grove dissenters). This in turn prompted a concurring opinion in support of the GVR order from Justice Scalia, who authored the Shady Grove majority opinion. The GVR order and opinions can be found at the end of today's Supreme Court order list.

The debate between Scalia and Ginsburg in Holster concerns Shady Grove's impact on claims arising under the Telephone Consumer Protection Act (TCPA), which authorizes a party to seek damages "if otherwise permitted by the laws or rules of court of a State." 47 U.S.C. § 227(b)(3). Ginsburg argues that no remand is necessary because the TCPA's explicit reference to state law "stands on its own footing as an adequate and independent ground for dismissing Holster's suit." She would therefore "spare the Court of Appeals the necessity of revisiting — and, presumably, reinstating — its TCPA-grounded ruling."

Scalia's concurrence calls Ginsburg's reading of the TCPA "highly implausible":

"Besides effecting an implied partial repeal of the Rules Enabling Act, 28 U.S.C. § 2072, it would require federal courts to enforce any prerequisite to suit state law makes mandatory — a state rule limiting the length of the complaint, for example, or specifying the color and size of the paper. A more probable reading . . . is that when a State closes its doors to claims under the Act § 227(b)(3) requires federal courts in the State to do so as well; but when such claims are allowed, the federal forum may apply its own procedures in processing them."

Stay tuned.

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Update on Qualcomm v. Broadcom E-Discovery Sanctions

Two years ago, many litigators took note after attorneys for Qualcomm Inc. were sanctioned for what the judge called a “monumental” discovery violation. (See earlier coverage on Electronic Discovery Law blog and Findlaw.)

This month, that same judge ordered that the sanctions against those attorneys be lifted. The court wrote that while “[t]here is still no doubt in this Court’s mind that this massive discovery failure resulted from significant mistakes, oversights, and miscommunication on the part of both outside counsel and Qualcomm employees, . . . the Responding Attorneys made significant efforts to comply with their discovery obligations.”

More coverage is available at the ABA Journal, Above The Law, and Law.com.

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