Civil Procedure & Federal Courts Blog

Improving Complex Litigation from Both Sides of the "V"

Steve McConnell at Drug and Device Law Blog has a nice post about a recent Mass Torts Forum/Roundtable for lawyers and judges that he attended last week in Philadelphia.  Among the observations that some of the judges made:

Addressing case management issues early is in everybody’s interest. Coordination, including between federal and state courts, can aid efficiency and reduce costs. It can also make it harder for parties to play jurisdictions against each other. An MDL can be a “life-changing” experience for a court. It starts to feel like a huge construction project, where landmarks along the way signal progress. Judges also look for “economies of scale.”

and

Judges are all over the map on how to select bellwether trials. There is still some support for letting each side pick their favorite cases, but it is possible that the best cases are not representative enough to mark out settlement values. Plus, plaintiffs can subvert the system by dismissing the defense picks at the last minute. Judges don’t like that. And here’s a piece of good news: most judges think it makes no sense to create a bellwether trial with multiple plaintiffs.

The whole post is worth reading and thinking about how plaintiffs' lawyers, defense counsel, and judges can all work together to improve complex litigation procedure and practice.

RJE

SALT Teaching Conference, University of Maryland, Oct. 4-6: Call for Panels & Papers

The Society of American Law Teachers (SALT) is holding its Teaching Conference on October 4-6, 2012, in Baltimore. The conference includes the 10th Annual LatCrit-SALT Junior Faculty Development Workshop.

The theme is Teaching Social Justice, Expanding Access to Justice: The Role of Legal Education & the Legal Profession. SALT’s Call for Panels & Papers is available here (deadline March 30, 2012).

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(Hat Tip: Brooke Coleman)

Thomas on Nonincorporation

Prof. Suja Thomas (Illinois) has posted on SSRN a draft of her article Nonincorporation. Here’s the abstract:

Very few rights in the Bill of Rights have not been incorporated against the states. In McDonald v. Chicago, the Court recently held that the Second Amendment right to bear arms, which the Court previously had decided was not incorporated, was incorporated. This decision left only three, what this Article terms, “nonincorporated” rights — the Fifth Amendment grand jury right, the Sixth Amendment criminal jury unanimity requirement, and the Seventh Amendment civil jury trial right — rights that the Court previously decided were not incorporated that remain not incorporated.

After the decision to incorporate the right to bear arms, an important unaddressed question with far-reaching implications is whether nonincorporation is defensible. Scholars to date have viewed the Bill of Rights exclusively through theories of incorporation, including the theory of selective incorporation under which incorporation occurs if a fundamental right exists. This Article is the first to view incorporation from the perspective of a theory of nonincorporation. This theory could be simply the opposite of selective incorporation — that a right is not fundamental — or, it could be, that the Court has not incorporated rights for some other reason.

This Article sets forth possible theories of nonincorporation, both prior to and after McDonald, and exploring their viability, concludes that no nonincorporation theory is defensible. The resulting incorporation of the nonincorporated rights would change the administration of justice in the states and also would make the Court’s theory on selective incorporation more justifiable.

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Whales Dismissed

In case you were wondering what ever happened to the complaint filed by five killer whales (represented by PETA) alleging that Sea World was subjecting them to slavery in violation of the 13th Amendment, it was just dismissed.  The district court in San Diego held that "the only reasonable interpretation of the Thirteenth Amendment's plain language is that it applies to persons, and not to non-persons such as orcas."  

So corporations are people, but killer whales are not.

Hat tip to Huff Post Green; the article is here.

PM

Easterbrook Sets Lawyers Straight (Again)

In a typically acerbic (but kind of funny) opinion, Judge Easterbrook again raised the issue of diversity jurisdiction at oral argument, which was apparently the first time the parties had considered it. 

   When we raised this issue at oral argument, counsel for

both sides were surprised to learn that “citizenship” for

the purpose of 28 U.S.C. §1332 depends on domicile

rather than residence.

The removing party, Northrop, then complied with the court’s order to amend its removal petition to properly allege citizenship.  Nonetheless, Judge Easterbrook chided:

 Jurisdiction should be ascertained before filing suit

in federal court (or, as here, removing a suit to federal

court). Counsel have wasted the court’s time, and their

clients’ money, by postponing essential inquiries until

after the case reached the court of appeals. That strategy

often leads to a jurisdictional dismissal and the need to

start over in state court. Why take that risk? Lawyers

have a professional obligation to analyze subject matter

jurisdiction before judges need to question the

allegations.

On the merits, the court affirmed the district court’s dismissal of the suit on the grounds that a contract between the parties compelled arbitration of their dispute. 

Judge Easterbrook then denied Northrop’s (appellee’s) request for sanctions on appeal – although the court agreed the appeal was frivolous – because Northrop had failed to follow proper procedures:

   Northrop contends that the appeal is frivolous—which

it is—and asks for sanctions. The request is in Northrop’s

appellate brief. But Fed. R. App. P. 38 provides that a

litigant seeking sanctions must request them in a “separately

filed motion”. And this court is not inclined to

award sanctions in favor of a party that cannot be

bothered to follow the rules itself. Morgan, Lewis &

Bockius, LLP, which represents Northrop, should be

able to tell the difference between residence and

domicile, and should not have any difficulty complying

with Rule 38.

Two weeks after oral argument, on the same day it

filed its amended notice of removal, Northrop filed a

separate motion for sanctions. This comes too late. If we

were seriously considering sanctions, we could have

initiated the process ourselves promptly after oral argument

(if not before). There is little point to requesting

sanctions twice, once in a brief and again by motion,

and the duplication can cause both confusion and extra

work for everyone. Rule 38 permits a court of appeals

to award sanctions, after giving notice and an opportunity

to respond, whether or not a litigant files a

separate motion. Our Practitioner’s Handbook for Appeals 45

(2003 ed.) tells counsel that the court may elect to

issue such a notice if a brief requests sanctions. See also

Greviskies v. Universities Research Association, Inc., 417 F.3d

752, 760–61 (7th Cir. 2005); In re Bero, 110 F.3d 462 (7th

Cir. 1997). Unless the court gives notice, however, an

adverse litigant is free to ignore a request made in

a brief. Likewise an adverse litigant can safely ignore a

post-argument motion for sanctions, unless the court

calls for a response.  

 

Many thanks to Shaun Shaughnessy for posting this case on the Civil Procedure listserv.

PM

Proliferation of Local Rules, Judge-Specific Rules Reported

The ABA “Litigation News” has a brief article entitled “Does Federalism Work for the Federal Rules?” available here.

PM

Zimmerman and Sant'Ambrogio on the Agency Class Action

Adam Zimmerman (St. Johns) and Michael Sant'Ambrogio (Michigan State) have posted The Agency Class Action to SSRN.  

Abstract:      
The number of claims languishing on administrative dockets has become a new “crisis” — producing significant backlogs, arbitrary outcomes and new barriers to justice. Coal miners, disabled employees, and wounded soldiers sit on endless waitlists to appeal the same kinds of administrative decisions that frequently result in reversal. Refugees seeking asylum from the same country play a dangerous game of “roulette” before arbitrary decisionmakers. Defrauded consumers and investors miss out on fair compensation, as agencies settle the same claims with wrongdoers without victim participation or meaningful judicial oversight. 

Reformers have called for new resources, more administrative law judges and improved attorney fee arrangements. But surprisingly, commentators have largely ignored tools long used by courts to resolve common claims raised by large groups of people: class action and complex litigation procedures. Almost no administrative law process allows groups to aggregate and resolve common claims for relief. As a result, in a wide variety adjudicatory proceedings, administrative agencies routinely (1) waste resources on repetitive cases, (2) reach inconsistent decisions for the same kinds of claims, and (3) deny individuals access to the affordable representation that aggregate procedures otherwise promise. Moreover, procedural and substantive hurdles — including exhaustion of administrative remedies and judicial deference to agency expertise — often prevent federal courts from providing class-wide relief to parties in agency adjudications.

We argue that agencies themselves should adopt aggregation procedures, like those under Rule 23 of the Federal Rules of Civil Procedure, to adjudicate common claims raised by large groups of people. After surveying the current tools by which agencies could promote more efficiency, consistency and legal access — including rulemaking, stare decisis, attorneys fees and federal court class actions — we find agency class action rules more effectively resolve common disputes by: (1) efficiently creating ways to pool information about recurring problems and enjoin systemic harms; (2) achieving greater equality in outcomes than individual adjudication; and (3) securing legal and expert assistance at a critical stage in the process. In this way, The Agency Class Action represents a new kind of decision-making for administrative agencies — a blend of adjudication and rulemaking for large groups of people who similarly depend upon the administrative state for relief.

RJE

Baker and Kim on A Dynamic Model of Doctrinal Choice

Scott Baker and Pauline Kim (both of Washington University) have posted A Dynamic Model of Doctrinal Choice to SSRN.

Abstract:      
This paper develops a repeated game model of the choice of doctrinal form by a higher court. Doctrine can take any point along a continuum from more determinate, rule-like legal commands to more flexible, standard-like directives. In deciding a case, the Supreme Court not only decides on a substantive outcome, but also chooses where on this continuum to set the doctrine. The lower court then applies the legal command to future cases. In doing so, it may wish to take into account new information, but the cost of doing so varies with the form of the legal doctrine. The model shows that in equilibrium doctrine oscillates over time between more rule-like commands and more standard-like commands. What triggers the shift in doctrinal form are the lower court's "mistakes" when trying to implement the standard in the way the Supreme Court prefers. The mistakes induce the Supreme Court to cabin the lower court's discretion by issuing more rule-like legal commands for a certain number of periods. Too much constraint, however, produces error costs when the lower court cannot adjust the law appropriately to new circumstances, leading to a shift back to more standard-like doctrine. We derive comparative statics showing how the length of the constraint phase responds to the degree of preference conflict between the courts. Finally, we illustrate the features of the model through a doctrinal case study of the law governing the voluntariness of confessions.

RJE

Seventh Circuit Upholds Class Certification, Distinguishing Dukes

In Ross v. RBS Citizens, N.A., No. 10-3848, 2012 WL 251927 (7th Cir. Jan. 27, 2012), employees of over 100 Illinois branches of the bank d/b/a Charter One brought a class action alleging that Charter One had an unofficial policy of denying employees overtime pay, in violation of the FLSA and the Illinois Minimum Wage Law (“IMWL”).   

The district court certified two classes for the IMWL (the opinion does not mention any certification of the FLSA claim):

All current and former non-exempt [e.g., employees like tellers and personal bankers who performed “routine” tasks] employees of [Charter One] who have worked at their Charter One retail branch locations in Illinois at any time during the last three years, who were subject to [Charter One's] unlawful compensation policies of failing to pay overtime compensation for all hours worked in excess of forty per work week.

All current and former Assistant Branch Manager employees of [Charter One] who have worked at their Charter One retail branch locations in Illinois at any time during the last three years, who were subject to [Charter One's] unlawful compensation policies of failing to pay overtime compensation for all hours worked in excess of forty per work week.

As to the first class, Ross [the first class representative] “alleges that Charter One has an unofficial policy of denying overtime pay to its non-exempt employees by: (1) instructing them not to record hours worked per week over forty; (2) erasing or modifying recorded overtime hours; (3) giving them “comp time” instead of paying overtime; and (4) requiring them to perform work during unpaid breaks.”

As to the second class, Kapsa [the second class representative] “alleges that Charter One illegally denies ABMs overtime pay by misclassifying their positions as exempt even though ABMs spend the majority of their time performing non-exempt work.”

Charter One appealed the certification on the narrow basis that it did not comply with Rule 23(c)(1)(B) (“An order that certifies a class action must define the class and the class claims, issues, or defenses, and must appoint class counsel under Rule 23(g).”).  After oral argument, the Seventh Circuit asked for additional briefing on whether the two classes satisfied the commonality requirement following the “clarification” of that requirement by Wal-Mart v. Dukes.

As to the 23(c)(1)(B) issue, the court adopted the Third Circuit’s analysis of that subsection in Wachtel ex rel. Jesse v. Guardian Life Ins., 453 F.3d 179 (3d Cir. 2006). 

[W]e hold that the appropriate substantive inquiry for Rule 23(c)(1)(B) is “whether the precise parameters defining the class and a complete list of the claims, issues, or defenses to be treated on a class basis are readily discernible from the text either of the certification order itself or of an incorporated memorandum opinion.” Id. at 185. This means that an order (or incorporated opinion) must include two elements: “(1) a readily discernible, clear, and precise statement of the parameters defining the class or classes to be certified, and (2) a readily discernible, clear, and complete list of the claims, issues or defenses to be treated on a class basis.”

The court then held that the district court’s order here satisfied those standards:

The district court's certification order created an Hourly class and an ABM class both of which included employees and former employees “who were subject to defendants' unlawful compensation policies” (emphasis added). Charter One contends that the class certification order creates a conditional class that hinges on whether its overtime policy was unlawful. . . .

Although there is perhaps some minor ambiguity in the certification order, the district court's memo-randum opinion accompanying the order eliminates any potential for confusion. In fact, Judge Lefkow concluded in her Rule 23(b)(3) predominance analysis that an unlawful policy could be inferred based on “the number of people making the same allegations across branches, managers, positions, and time frames.” . . . . For purposes of class certification, Judge Lefkow found that all current and former employees who have worked at an Illinois Charter One location within the last three years were subject to an unlawful overtime policy, and as such, qualify as class members.

Similarly, the court found that “the plaintiffs' claims that will be tried as a class are ‘readily discernible’ from the district court's order and accompanying opinion.”

As to the Rule 23(a)(2) commonality issue, the court distinguished Dukes thus:

Despite Charter One's best efforts to fit the present case into the Dukes mold, there are significant distinctions. Perhaps the most important distinction is the size of the class and the type of proof the Dukes plaintiffs were required to offer.  . . . In Dukes, 1.5 million nationwide claimants were required to prove that thousands of store managers had the same discriminatory intent in preferring men over women for promotions and pay raises. Here, there are 1,129 Hourly class members and substantially fewer ABMs, all of whom are based only in Illinois. The plaintiffs' IMWL claim requires no proof of individual discriminatory intent. Instead, the plaintiffs' theory, supported by ninety-six Hourly class declarations and twenty-four ABM class declarations, is that Charter One enforced an unofficial policy in Illinois denying certain employees overtime pay that was lawfully due. All ninety-six Hourly declarations specifically allege that the declarant had been denied lawfully due overtime compensation. Eighty-nine declarations further allege that Charter One had a policy instructing the declarant not to record earned overtime. Meanwhile, the majority of the ABM declarants assert that they primarily performed non-exempt work. Although there might be slight variations in how Charter One enforced its overtime policy, both classes maintain a common claim that Charter One broadly enforced an unlawful policy denying employees earned-overtime compensation. This unofficial policy is the common answer that potentially drives the resolution of this litigation. Dukes, 131 S.Ct. at 2551. . . .

Ultimately, the glue holding together the Hourly and ABM classes is based on the common question of whether an unlawful overtime policy prevented employees from collecting lawfully earned overtime compensation. For that reason, we find that the district court's certification order satisfies the commonality prerequisite and the district court properly granted class certification.

PM

Clermont on Standards of Proof

Kevin Clermont (Cornell Law School) has posted Death of a Paradox: Perpetrated By Understanding the Standards of Proof to SSRN.

Abstract:      
Modern versions of logic — in particular, fuzzy logic and belief functions — help to explain how the standard of proof actually works in the law world. They suggest that factfinders view evidence of an imprecisely perceived and described reality to form a degree of belief in a fact’s existence, and that they apply the standard of proof by comparing that belief to their belief in its negation.

For understanding the standards of proof, these degrees of fuzzy belief work better than classical probability. They give a superior mental image of the factfinders’ task, conform more closely to what we know of people’s cognition, and capture better what the law says its standards are and how it manipulates them. One virtue of this reconceptualization is that it is not a radically different conception. Another virtue is that it nevertheless manages to resolve some stubborn problems of proof, including the infamous conjunction paradox.

RJE

Federal Civil Procedure Question from July 2011 Multistate Essay Examination

The National Conference of Bar Examiners probably posted the questions from the July 2011 bar exam some time ago.  I was only reminded to look when Kevin Clermont let me know that the link I’d posted to the February 2011 question no longer worked.  He’s right -- the NCBE has taken down the link to the February exam. 

To avoid such vanishing links in the future, I’ve cut and pasted the Federal Civil Procedure question from the July 2011 bar below. 

Having only read this quickly, I have to ask: am I missing something?  Really, the whole thing leads up to two straightforward appealability issues?     

Anyway, here it is:

Federal Civil Procedure Question (from July 2011 MEE)

OfficeEquip is a U.S. distributor of office machines. It is incorporated in State A, where it has its principal place of business. BritCo is a manufacturer of copiers. It is incorporated in Scotland and has its principal place of business in London, England. OfficeEquip sued BritCo, alleging that BritCo had breached a long-term contract to supply copiers to OfficeEquip.

The suit was filed in the United States District Court for State A, and OfficeEquip properly invoked the court’s diversity (alienage) jurisdiction.

BritCo made a timely motion to dismiss the complaint on the ground that it was filed in violation of a forum-selection clause in the supply contract that required all contract disputes to be adjudicated in London. While its motion to dismiss was pending, BritCo filed an answer to the complaint.

In its answer, BritCo denied breaching the supply contract. BritCo also made a counterclaim seeking damages for OfficeEquip’s alleged breach of a contractual covenant not to compete with BritCo.

OfficeEquip filed a motion for judgment on the pleadings on BritCo’s counterclaim, arguing that the covenant not to compete was unenforceable as a matter of law.

After a short period of discovery, the district judge issued the following two orders:

OfficeEquip’s motion for judgment on the pleadings is granted. The contractual covenant not to compete is void as a matter of public policy and is therefore unenforceable. Given that this is strictly a legal issue and entirely severable from OfficeEquip’s breach of contract claim, there is no just reason for delay, and I accordingly direct that judgment should be entered in favor of OfficeEquip on BritCo’s counterclaim.

BritCo’s motion to dismiss is denied. Enforcement of the forum-selection clause would be unreasonable in this case. OfficeEquip has never done business in London, and it would be extremely inconvenient for it to litigate there.

Trial on the breach of contract claim is scheduled in three months.

1.  Can BritCo immediately appeal the district court’s order granting OfficeEquip’s motion for judgment on the pleadings with respect to BritCo’s counterclaim? Explain.

2.  Can BritCo immediately appeal the district court’s order denying its motion to dismiss? Explain.

PM