Civil Procedure

Final Examination

Model Answer

QUESTION I.

1. Because we are in state court, the first part of my argument is that Florida has asserted personal jurisdiction. The Florida Long Arm Statute, Fla. Stat. Ann. § 48.193 asserts jurisdiction over both defendants.

Cataldo is subject to jurisdiction under 48.193(1)(b), (1)(f) and 48.193(1)(g). Cataldo committed a tortious act within the state under Subsection (b) because, even though he has never been to Florida, his conduct in New York and Pennsylvania resulted in a conversion of White’s jeep when the payment for the jeep was reversed by the bank, which (hopefully) is in Florida. It is well established that a tort is not “committed” until conduct resulting in the last necessary element of the tort occurs. Cataldo will argue that Subsection (b) requires the presence of the defendant in the forum state, and I would have to do research into Florida case law to see how this subsection has been interpreted. If he’s right, I am out of luck on this argument.

An alternative argument with respect to the tort of conversion is available under Subsection (1)(f) because Cataldo caused injury to White who was in Florida at the time he found out that the defendant was not going to pay for the jeep. (The conversion did not occur until the payment was nullified.) Cataldo was engaged in solicitation activities within the state by offering to sell his car to Barton. I would need some additional factual evidence that Cataldo knew that Barton was in Florida when he offered to sell the car to her.

We have an independent argument that Florida has asserted jurisdiction over Cataldo under Subsection (g) because the contract of sale required Cataldo to pay White and his nonpayment did not occur until White was in Florida. For this argument, it may matter less whether White’s bank account was at a Florida bank because wherever the bank was, the payment was due to be made to White and he was in Florida by then.

If these statutory arguments are successful, I also must show that assertion of jurisdiction under these circumstances under this statute does not violate due process under the Fourteenth Amendment to the United States Constitution. To do that, I must show that Cataldo had minimum contacts with the state of Florida and that asserting jurisdiction over him will not offend fair play and substantial justice. Frankly, this is going to be a challenge. The only contacts that count in this constitutional analysis are those intended by the defendant to involve the forum state. Cataldo said he did not know where White lived, although White’s initial offer to sell the jeep on v-Bay explicitly stated that he was moving to Florida. So Cataldo at least knew that White was headed to Florida. The facts rather clearly indicate that Cataldo intended not to pay White, and it is a plausible argument that he intended that White would believe that he had been paid while he was still in Pennsylvania and on his way to Florida and that the fraud would not become manifest until White was already in Florida. That is probably my best argument that the contacts were intentional. Cataldo will argue that it was merely foreseeable to him that White would suffer the loss in Florida and that, under World Wide Volkswagen, forseeability is not enough.

There is no possibility of showing that Cataldo has systematic and continuous contacts with Florida so there is no way to establish the constitutionality of general jurisdiction. On the other hand, we don’t need general jurisdiction because both the breach of contract and the conversion claim directly arise out of the conduct—nonpayment of a Florida resident.

Cataldo also engaged in contact with Florida by selling the car to Barton. He knew—I hope we can establish—that Barton lived in Florida and would use the automobile there. Selling a chattel to a domiciliary of a state constitutes a contact with that state. But that contact won’t do White any good unless he can show that his claims against Cataldo arise out of that contact. I suppose we could argue that White’s ability to recover from Cataldo was diminished when Cataldo disposed of the car. Cataldo surely argued that himself in the telephone conversation with me. But this is a farfetched relatedness argument and, for specific jurisdiction, the claims must relate to the contacts.

I don’t think fair play and substantial justice is going to be a big issue because, while Florida is a more convenient place for White than for Cataldo, it’s not that big a deal for someone to come from New York to Florida to litigate. Florida obviously has an interest in protecting its residents from conversion and breach of contract, and because the evidence mostly involves Internet transactions and banking transactions it would not be a problem to get the evidence into litigation conducted in Florida. Anyway most of the relevant evidence is on, or accessible from, White’s computer, which is in Florida.

Cataldo will meet these arguments by denying that he did anything that can be said to relate to Florida. The contract was to be performed in Pennsylvania. Even if the breach and the conversion actually occurred in Florida, Cataldo certainly did not know that White’s bank was in Florida, if that’s where it was. He would argue that the out of state character of everything that happened defeats both Florida’s assertion of jurisdiction over him under the statute, and also would make it unconstitutional to assert jurisdiction with him because he had no purposeful contacts at all with the state of Florida.

Cataldo will point out that the performance due under this contract was not at all like the performance due under the contract involved in Burger King. The most that was supposed to happen in Florida under this contact was that the credit card payment would be available for White to spend. That is a one shot item of performance. In Burger King, the contract called for many things to be done in the forum state over a considerable period of time. Thus Burger King is weak authority for the constitutionality of personal jurisdiction in this case.

I think we are going to have a tough time establishing personal jurisdiction over Cataldo.

On the other hand, establishing personal jurisdiction over Barton is easy. Barton lives in Florida and thus necessarily is engaged in “substantial and not isolated activity” within Florida. That results in general jurisdiction over her under § 48.193 (2). There is no constitutional problem with such assertion of jurisdiction under Helicopteros because the contacts are systematic and general. Moreover, if Justice Scalia’s approach in Burnham prevails, there is categorically sufficient constitutional jurisdiction over Barton because she was served with process (or will be soon; see Part (C)) while she was present in the state.

2. Our success on venue is almost certain. Because we are in state court, the Florida venue statute applies, Fla. Stat. Ann. § 47.011. 28 U.S.C. § 1391 is irrelevant. We sued Barton in the county where she is domiciled, and that is sufficient for venue against her under § 47.011. Under Linger v. Balfour, Cataldo, a nonresident, may be sued anywhere the court has jurisdiction. So venue against him also is proper in the Alachua County state court. The only problem is that, as set forth in the answer to Subquestion (A) personal jurisdiction over Cataldo is problematic. But if we don’t have personal jurisdiction over him, venue will not do us any good so it doesn’t much matter that personal jurisdiction and venue rise or fall together against Cataldo.

3. We have, however, big problems with service of process. Service of process on Cataldo is problematic because service on out-of-state defendants by first class mail is not authorized by Fla. Stat. Ann. § 48.194 rather, an officer authorized to serve process must have served him in the same way provided for service in state under § 48.031, by handing a copy of the summons and complaint to him or by leaving at his usual place of abode with someone 15 years or older and informing that person of its contents.

Service on Barton also is flawed. § 48.031 says that Barton should have been served by delivering a copy of the summons and complaint directly to Barton or by leaving it with someone at her usual place of abode. Instead, the deputy sheriff left it at her workplace. Unless she lives in her office, which is unlikely, we have not served process pursuant to Florida state law. Except for the workplace-being-an-abode, I know of no arguments that will overcome these deficiencies in service. We will simply have to send a New York deputy sheriff out in New York and send the Alachua County deputy sheriff out again to Barton’s home.

4. We would move to remand the removed action for the absence of subject matter jurisdiction. If there is some flaw in the way that the notice of removal was handed we also may have some procedural arguments for remand. For example, Barton’s lawyer may have failed to send a copy of the removal notice the clerk of the state court, but nothing in the statement of the question suggests that.

Removal jurisdiction exists under § 1441 only if the district court to which the case is removed would have had federal-question, diversity, or supplemental jurisdiction over the claims if the action had been filed there in the first place. We have strong arguments that diversity jurisdiction does not exist, and if it did exist, Barton nevertheless may not remove the case under 28 U.S.C. § 1441 (b). We will argue that White is now a citizen of Florida, which defeats complete diversity since that would make defendant Barton and plaintiff White citizens of the same state. What matters is citizenship at the time the lawsuit was filed (presumably when it was removed to federal court—not when the claim arose; I would want to check this). Citizenship depends on domicile, which in turn depends (citizenship is a matter of federal law not state law) White is clearly present in Florida and the only question is whether he has the intent to make this his domicile or whether his intent is to retain his domicile in Ohio. Barton will of course argue that by leaving some of his possessions in Ohio, he evidenced an intent to continue Ohio as his domicile and only to stay in Florida temporarily to perform the one-year employment term. Even if Barton can sustain her position that White is a citizen of Ohio and therefore there is complete diversity, we can establish—and indeed we have the power to make sure—that the jurisdictional amount of $75,000 is not satisfied. The accepted payment for the jeep was $20,000, and even if we can prevail on our conversion and federal wire fraud claims which presumably would entitled us to punitive damages, it is unlikely that total damages would be more than $75,000. Moreover, we can make sure of that by amending our complaint to seek damages not exceeding $75,000. That would require some tradeoff, of course, between the amount of money that White seeks, and his desire to be in state court, but that is entirely within our control.

Our ace in the hole is that Barton is not entitled to remove a case founded solely on diversity because she is a citizen of the forum state, under Section 1441(b)

We also have to consider the possibility that there may be federal question jurisdiction because of Paragraph 15 of our complaint, asserting the federal wire fraud claim. This is going to be a big problem for us because we have definitely pleaded a legal claim premised on federal law. The federal law, of course, only explicitly provides for criminal penalties, but our theory that it impliedly recognizes a private right of action goes to the merits. We would say that under Merrill Dow, this is exactly the kind of federal question claim that results in federal question jurisdiction, unless it is completely frivolous on its face. This is not like the facts of the Merrill Dow case itself where federal question jurisdiction was found not to exist because the claim was not premised on federal law. Here we are not saying that an issue of federal law is somehow intertwined with the state-law conversion and breach of contract action, but rather that we have an independent claim for wire fraud that is created by federal law.

But even if the federal wire fraud claim has to stay in federal court, we have pretty good arguments that the conversion and breach of contract claims, especially those against Barton, should be remanded to state court because supplemental jurisdiction under 28 U.S.C. § 1367 does not extend to them. Supplemental jurisdiction requires a common nucleus of operative fact between the “anchor claim”—the claim as to which diversity exists or the federal question claim, and we would argue that it does not exist here. The elements of wire fraud are distinct from the elements of conversion and breach of contract. For example, intent not to perform is not an element of breach of contract, while it is for fraud. Offer and acceptance are elements for breach of contract and they are not for fraud. Detrimental reliance is an element of fraud but not for breach of contract. And the elements for conversion and fraud are almost entirely distinct. And there is even less commonality between the claims against Barton and the wire fraud claim against Cataldo because we have not even asserted wire fraud against Barton, and her alleged conversion of the jeep occurred at a completely different time, after the transaction between White and Cataldo was complete.

On the other hand, the jeep itself is common to everything, all of the claims against Cataldo arise from the same factual transaction—the posting of the jeep on v-Bay, the negotiations by email, and the meeting in which the automobile, the bill of sale, and the credit card information were exchanged (actually the credit card information was sent ahead of time by email, but that doesn’t matter). So an expansive view of Section 1367’s “same case or controversy” would likely result in a finding that supplemental jurisdiction extends at least to the state law claims against Cataldo and maybe also to the state law claims against Barton.

But we have two other aces up our sleeve. First, there is no indication that Cataldo joined in the notice of removal, and that is a prerequisite for valid removal even for a federal question claim where a resident of the forum state is entitled to remove, but only if she is joined by all the other defendants.

Moreover,—this is our final ace in the hole—if we do not want to litigate in federal court, we simply can amend the complaint to withdraw the wire fraud claim as well as limiting our damages claim as mentioned earlier. Again, that presents us with a strategic choice: whether we want the punitive damages that may be available for the wire fraud claim and not for the two state law claims more than we want to be in state court or vice versa. But this is entirely under our control.

5. If we are bounced out of state court in Florida, we have several alternatives. We could fix the service of process problem, if that’s what got us bounced. We can’t fix the personal jurisdiction problem with respect to Cataldo and Florida. So it won’t do us any good if we refile in federal court in Florida.

So we should look elsewhere. Ohio might be tempting with respect to Cataldo except that he may have had less knowledge that White began in Ohio than that White was destined for Florida. Moreover, there is little basis for arguing that Barton had any contact with Ohio whatsoever. So it looks like we would have insuperable personal jurisdiction problems in Ohio.

That leaves Pennsylvania and New York as candidates. Pennsylvania probably would be okay for the suit against Cataldo because the exchange of the automobile and the bill of sale took place in Pennsylvania. But Barton had nothing to with Pennsylvania either.

So the best bet is to sue both Cataldo and Barton in New York. That’s where Cataldo lives, so general jurisdiction exists over him there under any conceivable New York jurisdictional law, and it is plainly constitutional. And we have good personal jurisdiction arguments with respect to Barton because she traveled to Buffalo, New York to pick up the automobile. That’s clearly a contact with New York, directly related to the conversion claim against her. New York presumably asserts jurisdiction in such circumstances and the jurisdiction plainly would satisfy minimum contacts and fair play and substantial justice.

So then the only remaining questions are whether we should sue in federal or state court in New York, and whether we should split our action into two separate lawsuits. I don’t see any particular advantage from suing in New York federal court as opposed to New York state court, and if we sue in federal court we are going to have the same subject matter jurisdiction arguments that we mobilized in an effort to get the case remanded to state court in Florida from federal court in Florida. So if we want to sue Cataldo and Barton in the same lawsuit, as the question suggests, we should do it in state court in New York.

Another possibility if we don’t want to keep both defendants together in the same lawsuit is to sue Cataldo in state court in either Pennsylvania or New York, and keep our lawsuit against Barton in state court in Florida where there plainly is personal jurisdiction over her.

6. I would tell my associate that the main problem with his Paragraph 15 is that it does not meet the requirements of Fed. R. Civ. P. 9 if we are federal court. If we are in Florida state court, I’m concerned that Florida state procedure may require fact pleading instead of the more relaxed notice pleading requirement exemplified by Federal Rule 8. In any event it can do us little harm to revise this allegation of wire fraud by particularizing it: identifying the specific communications that we say were fraudulent, which surely include the agreement to buy the car and the transmittal of the fraudulent credit card information, the dates on which they occurred, and, probably, the resulting bank action in reversing the debit.

I also would discuss with the associate whether we want to leave ourselves open to removal to federal court by keeping Paragraph 15 in our complaint, because we surely have learned that it may be a problem for us to get a federal claim remanded, in my answer to Subquestion (D).

7. It may be tough to get a preliminary injunction, even though preliminary injunctions are authorized by Fed. R. Civ. P 65. Of course, a preliminary injunction cannot be granted until both sides have been heard but that doesn’t seem to be a problem here because both defendants have appeared in the lawsuit and their lawyers should not be hard to contact. The biggest problem is that White may be unable to establish one of the jurisdictional prerequisites for an injunction—the insufficiency of legal relief. He can hardly claim that he wants the jeep. He sold it already, so what he really wants is his $20,000 and maybe some additional damages. That’s money. And a money judgment for damages would be better suited to give him what he wants than the return of the jeep.

Indeed, the only conceivable way that he could make an irreparable injury argument (another equitable prerequisite) at this stage is on the grounds that both Barton and Cataldo are so impoverished or so slippery that they are judgment proof and the only way to ensure his practical ability to get anything out of a judgment in his favor is to make sure assets are available at the time he gets a judgment. He has fairly strong probability of success on the merits. Its not that Barton would be terribly inconvenienced by having to hang on to the car while the lawsuit is proceeding. It’s not like White was trying to get an injunction compelling her never to drive the car or to turn it over to him right now. And there is no public interest either way.

So our best argument—and it’s still something of a long shot—is to say that we would be happy with legal remedies, but we are not going to get any legal remedies unless the injunction is granted because there will be no money or other property to execute a judgment against.

QUESTION II.

1. I would notice the parking attendant for a deposition under Rule 30 and request production of documents and things under Rule 34 and back them up by a subpoena under Rule 45, pursuant to Rules 30(a) and 34(c). Absent a subpoena, the parking attendant, a nonparty, could not be compelled to make discovery. In the deposition I would ask the parking attendant what he saw, the basis for his belief that the driver of the suburban deliberately drove over the motorcycle, whether there were any other witnesses, and if so, their identities, and whether there was a security camera that might have video of the incident. I also would ask him in detail about the driver’s behavior before, during, and after the incident and in particular whether there was anything about the vehicle or about the driver’s behavior that suggested any connection with terrorist activities.

2. Since the Chicago Police Department is a nonparty the only way to compel it to give up the accident report is through a Rule 45 subpoena, perhaps coupled with a Rule 34 request for production, although the Rule 34 request is not necessary if I serve a subpoena. I also might be interested in subpoenaing the officers who conducted the investigation, after ascertaining their identities from the police department, so that I could depose them. I also would request in a subpoena copies of any 911 tapes of the call. Both the officers and the 911 tapes may provide information not contained in the report

3. I would amend the complaint to substitute Sebastian Corwin and Jamie Corwin for the John Doe defendant. Then, as parties, they can be compelled under Rule 37 to make discovery under any of the usual methods.

1. I need not ask about any insurance policies because I will get that in the mandatory Rule 26(a)(1) disclosures after we have had our Rule 26(f) discovery conference. I would ask Sebastian about:

1. Whether he gave Jamie permission to drive the Suburban on the date in question. This would help me establish that Jamie was his agent or that he negligently gave Jamie access to the vehicle.

2. The nature and location of his assets.

3. The nature and location of Jamie’s assets and the nature and location of his employment.

4. Whether he or Jamie have talked to anyone about the accident and if so, who they are.

5. Whether Jamie or he is a member of any organization that might be considered terrorist in character.

I would ask the question about assets and employment in interrogatories because I would be likely to get more precise answers. I would ask the other questions in a deposition because I can press Sebastian more readily for responsive answers and gauge his veracity and his likely suitability as a witness for his version of the events.

2. I would ask Jamie:

1. About Jamie’s assets and employment, seeking details about location.

2. Whether he had his father’s permission to use the Suburban on the day in question.

3. Whether he deliberately drove over the motorcycle and if he claims it was not deliberate, what precautions he took to make sure the motorcycle was not in the way. This would help me establish liability for conversion or negligence.

4. The identity of anyone he talked to about the accident or anyone who witnessed it.

5. Whether he is a member or otherwise affiliated with any organizations that might be terrorist in character.

I would ask about his assets in interrogatory form because I would be more likely to get precise answers. All the other questions I would ask in a deposition because I would be in a position to press for more responsive answers and to gauge his strengths and weaknesses as a possible witness.

4. I would be hugely worried about Rule 11 sanctions for my cavalier inclusion of the war crimes allegation in the complaint. I know nothing about the War Crimes Act and had no reasonable basis for believing that it was valid legal claim. I conducted no investigation (though I am now, in discovery) to see whether there was any factual basis for claiming that either of the defendants was associated with a terrorist organization.

Even without a motion under Rule 11, I would be ready to amend the complaint to withdraw the war crimes allegation unless I conduct immediate legal research that shows that there might be legal basis for a claim and unless my discovery questions elicit answers that suggest that there might be some factual basis for such an allegation.

If I am confronted with my obligations under Rule 11, I will have 21 days after service on me of a Rule 11 motion to withdraw the claim, pursuant to Rule 11(c)(1)(A). If, however, the court initiates Rule 11 proceedings I have no 21-day safe harbor.