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FALL 2016

*INTRODUCTION TO UNITED STATES LAW--Lecture Topic 5: What Federal Courts Do/Jurisdiction
    --Last Modified: Tuesday, 09-Aug-2016 07:53:57 EDT

Lecture 5: What the Federal Courts Do/Jurisdiction

Introduction

The United States Courts compile a variety of statistics each year relating to the judicial caseload of the federal court system. Examining these caseload statistics gives a preliminary indication of what the U.S. District Courts and the U.S. Courts of Appeal do.

[Note that you will see slightly different numbers presented in various of the reported federal statistics because different reports use different end dates. Some reports are for periods ended March 31 as required by a federal statute whereas other reports are for periods ending September 30 to coincide with the end of the fiscal year of the federal government. Further, some reports have other period end dates. Do not worry about these differences for purposes of the lecture. We are most interested in looking at relative magnitudes of different kinds of cases, as well as multi-year trends and not precise numbers for any given year. Links are provided to the various government reports for the details.]

Looking at the statistics for the U.S. District Courts, we find that in 2015 plaintiffs filed 279,036 civil complaints and prosecutors filed 80,069 criminal complaints against defendants. Additionally, 860,182 cases commenced in the U.S. Bankruptcy Courts. You may recall from Lecture 3 that the U.S. Bankruptcy Courts operate in each judicial district under the supervision of the U.S. District Court in that district. In 2015, litigants filed 52,698 new appeals in the U.S. Courts of Appeals. See United States Courts, Judicial Caseload Indicators-Judicial Business 2015.

Of the federal court case filings in recent years, approximately 70% are bankruptcy cases, 20% are civil cases and 10% are criminal cases. The number, and thus percentage, of bankruptcy cases fluctuates with the state of the economy. Bankruptcy filings peaked following the financial market crash in 2008 to almost 1.5 million filings a year in 2011; and now, following the stabilization of the economy, have declined significantly.

Comparison to State Courts: By way of comparison, the various state courts handle vastly more cases than the federal courts. As a very rough guide, across recent years, for every one federal case filed there will be approximately 30 cases filed in state courts in any given year. State court statistics are not compiled on a systematic nationwide basis and, thus, data is harder to locate. However, a 2009 study gave an insight into the nationwide picture. Examining the Work of State Courts: An Analysis of 2009 State Court Caseloads. To keep the vast state court numbers in perspective, you will see from the 2009 analysis of state court caseloads that a majority of the state court cases by number are for traffic violations and other relatively minor matters. Nevertheless, the administrative burden is significant. Backlogs and delays plague the system as there are only approximately 1,700 federal judges and approximately 30,000 state judges nationwide to handle this workload.

The cases in the federal system tend to be of greater national importance than cases in the state court system, particularly cases decided by the U.S. Supreme Court (for example, resolution of the issue of same-sex marriage) or they involved more significant financial disputes. However, certain state court proceedings gain national attention when they involve famous persons (such as the trial of OJ Simpson) or raise issues of national concern (such as the shooting of an unarmed African-American—Trayvon Martin—by George Zimmerman) or have a mystery or sensational aspect that appeal to a national audience (such as the trial of Casey Anthony for the murder of her young daughter).

As should be clear from the presentation of the federal statistics, the three major types of cases heard in the federal court system are civil cases, criminal cases and bankruptcy cases, which are discussed below.

Three Major Types of Federal Cases

Consider the below description of each type of case prepared by the Federal Judicial Center [into which additional comments have been inserted between brackets]:

[Start Federal Judicial Center excerpt]

Civil Case

A civil case begins when a person or entity (such as a corporation or the government), called the plaintiff, claims that another person or entity, called the defendant, has failed to carry out a legal duty owed to the plaintiff. Both the plaintiff and the defendant are also referred to as parties or litigants. The plaintiff may ask the court to tell the defendant to fulfill the duty, or make compensation for the harm done, or both. Legal duties include respecting rights established under the Constitution or under federal or state law.

Civil suits are brought in both state and federal courts. An example of a civil case in a state court would be if a citizen (including a corporation) sued another citizen for not living up to a contract.

For example, if a lumberyard enters a contract to sell a specific amount of wood to a carpenter for an agreed-upon price and then fails to deliver the wood, forcing the carpenter to buy it elsewhere at a higher price, the carpenter might sue the lumberyard in state court to pay the extra costs incurred because of the lumberyard’s failure to deliver; these costs are called damages. If these parties were from different states, however, then that suit could be brought in federal court under diversity jurisdiction if the amount in question exceeded the minimum required by statute ($75,000). [Note: diversity jurisdiction will be explained in more detail below.]

Individuals, corporations, and the federal government can also bring civil suits in federal court claiming violations of federal statutes or constitutional rights. For example, the federal government can sue a hospital for overbilling Medicare and Medicaid, a violation of a federal statute. An individual could sue a local police department for violation of his or her constitutional rights--for example, the right to assemble peacefully.

[In civil cases, the plaintiff often is a private party (rather than a state government or the federal government, the plaintiff must prove its case by satisfying a “civil” burden of proof which typically requires that it prove the defendant is liable by a preponderance of the evidence (though sometimes the higher burden of clear and convincing evidence is required) and the purpose of the lawsuit typically is to obtain financial compensation for injuries suffered.]

Criminal Case

A person accused of a crime is generally charged in a formal accusation called an indictment (for felonies or serious crimes) or information (for misdemeanors). The government, on behalf of the people of the United States, prosecutes the case through the United States Attorney's Office if the person is charged with a federal crime. A state’s attorney’s office prosecutes state crimes.

It is not the victim’s responsibility to bring a criminal case. In a kidnapping case, for instance, the government would prosecute the kidnapper; the victim would not be a party to the action.

In some criminal cases, there may not be a specific victim. For example, state governments arrest and prosecute people accused of violating laws against driving while intoxicated because society regards that as a serious offense that can result in harm to others.

When a court determines that an individual committed a crime, that person will receive a sentence. The sentence may be a monetary penalty (a fine and/or restitution to the victim), imprisonment, or supervision in the community (by a court employee called a U.S. probation officer if a federal crime), or some combination of these three things.

[In a criminal case, the “plaintiff” is the state or federal government often referred to as the “prosecution. The prosecution must satisfy a criminal burden of proof by proving that the defendant is guilty beyond a reasonable doubt, and the purposes of the prosecution are primarily driven by a desire to protect the public, and to punish or rehabilitate those convicted (through incarceration or fines), and sometimes to provide restitution to a victim through a restitution order.]

What is a bankruptcy case?

Bankruptcy generally provides one of two options: liquidation or reorganization. Liquidation means selling off a debtor's assets to raise cash for creditors. If the debtor is an individual, the debtor is allowed to keep some property and his or her debts are discharged, which means the debtor is excused from paying more than the amount raised by the liquidation. If the debtor is a business, it no longer exists after liquidation. In some bankruptcy cases, debtors have the option of reorganizing rather than liquidating. Reorganization involves obtaining court approval of a plan that includes provisions for repayment over time of all or a percentage of the debts owed creditors. In a reorganization involving a business, the debtor business gets to keep its assets and continue to operate. Its debts are restructured so that it can pay a reduced amount over a longer period of time, which usually gives creditors more than they would get in a liquidation. Individual debtors may also "reorganize" through bankruptcy by obtaining court approval of a plan to pay part or all of the debts owed by making scheduled payments to creditors through a trustee for a period of time. This allows the debtor to keep assets and, in some instances, avoid foreclosure proceedings on the family home.

[End Federal Judicial Center excerpt.]

Different Types of Civil Cases in the Federal System

Another set of federal statistics gives information on the nature of the different types of civil cases that are heard by the federal courts. These summary statistics break down the major types of federal civil cases by number of cases filed into four categories: federal question cases (150,157); diversity of citizenship cases (87,772); U.S. Defendant cases (37,349); and, U.S. Plaintiff cases (6,325). United States Courts, Federal Judicial Caseload Statistics.

These four categories correspond to the types of federal subject matter jurisdiction which support the most numbers of civil cases (outside the context of bankruptcy cases). What federal courts do is limited by the subject matter jurisdiction which has been granted to the federal courts by statute. [The Federal Judicial Center provides a summary of the different types of federal subject matter jurisdiction here. You should read that summary, paying particular attention to the links that describe federal question jurisdiction, diversity jurisdiction and civil, U.S. as a party.] The federal courts are often referred to as courts of limited subject matter jurisdiction because the federal courts do not have the power to adjudicate just any type of general dispute. Rather, there power to adjudicate a dispute is limited by the enumerated grounds for assertion of subject matter jurisdiction. In contrast, the trial courts in state court typically are courts of general jurisdiction—which means they have the power to hear any kind of case. (Though, you should know that in state court systems certain types of disputes are heard by courts of limited jurisdiction—for example, contract disputes over small sums of money often are heard by “small claims” courts.)

The subject matter jurisdiction of the federal courts is set forth in Title 28 of the United States Code, in Part IV. [As an exercise, follow the link on the “Helpful Links” page for the United States Code to find this part of the law. Sections 1330-1369 deal specifically with the jurisdiction of the federal district courts.]

It is essential to understand that subject matter jurisdiction is about the power to hear a particular type of case. If subject matter jurisdiction does not exist, the court is literally powerless to adjudicate the dispute. This is why a court may, on its own motion, raise the issue of subject matter jurisdiction at any time in the case and, if the court decides that it does not have subject matter jurisdiction it must dismiss the case. A corollary of subject matter jurisdiction being about power is that the parties themselves are unable to waive subject matter jurisdiction. If a court does not have it, the case must be dismissed even if the parties all consent to the case being heard by the court. Of course, a defendant may make a motion to dismiss a case for lack of subject matter jurisdiction.

Personal jurisdiction distinguished from subject matter jurisdiction

Subject matter jurisdiction must be distinguished from personal jurisdiction. Personal jurisdiction is about the power of a court to compel a defendant to appear before it. You should recall from Lecture 1 the brief introduction to so-called “long-arm” statutes. A long-arm statute is a statute that allows a plaintiff in a court in state A to compel a defendant in state B to appear and answer a complaint filed in a court in state A.

Plaintiff A might file a complaint against defendant B in state court in state B. This is the easiest case because the defendant is located in state B and, accordingly, the court in state B would have personal jurisdiction over B. Alternately, plaintiff A might try to file a suit against defendant B in a state court in state A. Plaintiff A might file suit in state A because it is more convenient for A. Further, A may feel that the courts of state A will be more sympathetic to it because that is A's home state and defendant B is out of state. Suit may be possible in state A if A can use a long-arm statute to compel B to appear and answer the complaint in state A. This will be possible if A can locate a statute that purports to give court A personal jurisdiction over B—but only if B has the requisite “minimum contacts” with state A will the assertion of personal jurisdiction be upheld. Very generally, the court in state A may have personal jurisdiction over B if B had entered into state A, caused some injury to A while in state A, and then B returned to his or her home state of B. In such a case, the court in state A would be said to have specific jurisdiction over the defendant B. State long-arm statutes often include a listing of specific enumerated acts which might occur in state A which would give the courts of state A specific jurisdiction over defendant B. Additionally, although it is more rare, B might have sufficient ongoing and significant connections with state A such that a court may assert general jurisdiction over B. The idea is that sufficient ongoing and significant connections with state A might make it the case that B is subject to suit in state A even for causes of action that arose elsewhere because B is deemed to be present or “at home” in state A. In the language of the courts, the contacts of defendant B with state A must be “continuous and systematic” for a court of state A to properly exercise long-arm jurisdiction over defendant B for a cause of action that did not arise in or have some other connection to state A.

As a very general matter, a plaintiff in a court in state A may compel a defendant in state B to appear and answer the complaint filed in a court in state A so long as the defendant in state B has sufficient minimum contacts with state A so that forcing an appearance and an answer does not offend notions of due process (this assumes that state A has a long-arm statute which purports to allow jurisdiction over B). The defendant in state B generally is permitted to make what is called a “special appearance” in the court in state A for the limited purpose of contesting the existence of personal jurisdiction. However, if the defendant in state B makes a general appearance in the court in state A to answer the complaint without contesting the existence of personal jurisdiction, the defendant has waived its right to thereafter contest the personal jurisdiction of the court and the case will proceed.

The key point is that an objection to the assertion of personal jurisdiction may be waived whereas lack of subject matter jurisdiction may never be waived. This is because the due process rights that protect against an unfettered assertion of personal jurisdiction are rights that are personal rights of the defendant (which a defendant may waive) whereas lack of subject matter jurisdiction is about the fundamental power of the court to adjudicate a dispute.

Now, you will sometimes see a distinction made between “personal” jurisdiction and “in personam” jurisdiction. Full in personam jurisdiction exists when the court can compel the defendant to appear in person before the court. There are two lesser forms of personal jurisdiction which are sufficient to allow a court to adjudicate a case but do not involve or require the defendant to appear personally before the court (indeed, often these alternate methods are used when it is not possible to obtain service of process on the person of the defendant). These forms of personal jurisdiction are in rem jurisdiction and quasi-in-rem jurisdiction. In these cases, power over the defendant is obtained not directly over the person of the defendant but indirectly by the court obtaining power over property that is owned by the defendant. In some cases, the legal dispute arises over ownership of an item of property itself. Suppose title to land is involved. A court with jurisdiction over the location where the real property is located would have in rem jurisdiction to hear a case to decide proper title to the property even if personal service of process may not be obtained over the defendant. Even in cases where the dispute does not involve property owned by a defendant, a plaintiff may sometimes assert personal jurisdiction to decide a case based on property owned by the defendant within the jurisdiction of the court. If the plaintiff seizes property of the defendant in the jurisdiction he may obtain jurisdiction over the defendant to the extent of the value of the property. A personal judgment against the defendant in such a case based on quasi-in-rem jurisdiction would limit any recovery to the value of the property seized. I mention in rem and quasi-in-rem jurisdiction in the introduction to the course because those are terms that may come up while reading cases for other courses.

Federal question jurisdiction

The statute governing federal question jurisdiction is brief and simple on its face. However, it can sometimes be a matter of great difficulty to decide whether a particular case actually involves a federal question. The statutory grant of federal question jurisdiction appears below:

§1331. Federal question

The district courts shall have original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States.

(June 25, 1948, ch. 646, 62 Stat. 930; Pub. L. 85–554, §1, July 25, 1958, 72 Stat. 415; Pub. L. 94–574, §2, Oct. 21, 1976, 90 Stat. 2721; Pub. L. 96–486, §2(a), Dec. 1, 1980, 94 Stat. 2369.)

Diversity jurisdiction

Diversity jurisdiction often is simply described as a lawsuit involving citizens from two different states, for example a plaintiff in state A decides to sue a citizen in state B for injuries suffered as a result of a breach of contract or a tort (i.e. think of a tort simplistically as an accident of some sort). Such suits for damages could typically be brought in a state court of general jurisdiction.

Now, in some cases, plaintiff A may have a second option for bringing a lawsuit against defendant B. Plaintiff A may bring a lawsuit in a federal district court against defendant B IF the case in controversy exceeds the “jurisdictional amount” set forth in the federal statute. Currently, this jurisdictional amount is set at $75,000 [note that the matter in controversy must exceed $75,000, and not simply be equal to $75,000]. (Congress has periodically increased the jurisdictional amount in light of inflation. Periodically increasing the jurisdictional amount is one method used to reduce the caseload in the federal courts.) Consider the following excerpt from the diversity jurisdiction statute:

§1332. Diversity of citizenship; amount in controversy; costs

(a) The district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between—

(1) citizens of different States;

(2) citizens of a State and citizens or subjects of a foreign state, except that the district courts shall not have original jurisdiction under this subsection of an action between citizens of a State and citizens or subjects of a foreign state who are lawfully admitted for permanent residence in the United States and are domiciled in the same State;

(3) citizens of different States and in which citizens or subjects of a foreign state are additional parties; and

(4) a foreign state, defined in section 1603(a) of this title, as plaintiff and citizens of a State or of different States.

* * *

Venue

Plaintiff A may, in our example, commence an original action in federal district court assuming satisfaction of the case in controversy amount. However, the particular federal district court that plaintiff A may select to file a complaint is further subject to rules governing what is called “venue.” There is little doubt that venue will be proper in the federal district court in which defendant B resides. Further, if the alleged misconduct occurred in state A, venue may be proper in federal district court in state A. Otherwise, if no alleged misconduct took place in state A, venue may not be proper in the federal district court in state A. Consider the following excerpt from the federal statute governing venue.

§1391. Venue generally

(a) Applicability of Section.—Except as otherwise provided by law—

(1) this section shall govern the venue of all civil actions brought in district courts of the United States; and

(2) the proper venue for a civil action shall be determined without regard to whether the action is local or transitory in nature.

(b) Venue in General.—A civil action may be brought in—

(1) a judicial district in which any defendant resides, if all defendants are residents of the State in which the district is located;

(2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated; or

(3) if there is no district in which an action may otherwise be brought as provided in this section, any judicial district in which any defendant is subject to the court's personal jurisdiction with respect to such action.

* * *

You might note that diversity jurisdiction is based on the concept of “citizenship” whereas venue determinations depend, where relevant, on the concept of “residency.” As you might suppose, the federal state thus defines the concept of residency:

* * *

(c) Residency.—For all venue purposes—

(1) a natural person, including an alien lawfully admitted for permanent residence in the United States, shall be deemed to reside in the judicial district in which that person is domiciled;

(2) an entity with the capacity to sue and be sued in its common name under applicable law, whether or not incorporated, shall be deemed to reside, if a defendant, in any judicial district in which such defendant is subject to the court's personal jurisdiction with respect to the civil action in question and, if a plaintiff, only in the judicial district in which it maintains its principal place of business; and

(3) a defendant not resident in the United States may be sued in any judicial district, and the joinder of such a defendant shall be disregarded in determining where the action may be brought with respect to other defendants.

* * *

Removal

Now, suppose that plaintiff A does file suit against defendant B in state court in state A. Assume that defendant B has sufficient minimum contacts with state A (or continuous and systematic connections with state A) so that the court in state A may properly assert jurisdiction over defendant B. It is still possible that this case might end up in federal court. If the jurisdictional amount is satisfied (i.e. the damage claim is for more than $75,000), defendant B has the option of seeking to “remove” the case from state court A to federal district court in state A. Consider the following excerpt from the removal statute of Title 28.

§1441. Removal of civil actions

(a) Generally.—Except as otherwise expressly provided by Act of Congress, any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending.

* * *

The theory behind allowing defendant B to remove the state court action to federal court is that removal may eliminate or reduce any prejudice that defendant B may face in a “foreign” state court tribunal. (Suppose that a local football hero in Texas decides to sue a New York based bank in a state court in Texas. In such a case, it is of concern that the local Texas judge might favor the plaintiff—particularly if the state court judge is subject to periodic re-election.) You might recall from Lecture 4 and elsewhere that the structure of the federal judiciary is such that it particularly insulates judges from local or political pressure (i.e. by providing life tenure and prohibiting a diminution in salary). As you also may recall in our discussion of judicial independence, state court systems often do not provide the same level of protection against potential bias. It is for this reason that, in cases involving larger damages (i.e. in which the jurisdictional amount is satisfied), defendants have the option to remove cases to federal court.

Complete Diversity

The right to bring an action in district court (and to remove an action to federal court) is not a universal option in a case between citizens of two states both because there is the jurisdictional amount AND because there is a requirement of “complete diversity” of the parties. What this means is that, in a multi-party case, the plaintiffs all have to be citizens of states that differ from the states in which the defendants are citizens. For example, if the plaintiff is from state A and the defendants are from both state A and from state B, there is not complete diversity. In the absence of complete diversity, the federal courts would not have subject matter jurisdiction even if the case or controversy involved damages asserted to be more than $75,000. What this means is that, in practice, you need some fairly detailed rules to determine the state of citizenship of litigants. Consider the following excerpt from the diversity jurisdiction statute which attempts to identify the citizenship of litigants:

§1332. Diversity of citizenship; amount in controversy; costs

* * *

(c) For the purposes of this section and section 1441 of this title—

(1) a corporation shall be deemed to be a citizen of every State and foreign state by which it has been incorporated and of the State or foreign state where it has its principal place of business, except that in any direct action against the insurer of a policy or contract of liability insurance, whether incorporated or unincorporated, to which action the insured is not joined as a party-defendant, such insurer shall be deemed a citizen of—

(A) every State and foreign state of which the insured is a citizen;

(B) every State and foreign state by which the insurer has been incorporated; and

(C) the State or foreign state where the insurer has its principal place of business; and

(2) the legal representative of the estate of a decedent shall be deemed to be a citizen only of the same State as the decedent, and the legal representative of an infant or incompetent shall be deemed to be a citizen only of the same State as the infant or incompetent.

* * *

United States as plaintiff

The statute providing for subject matter jurisdiction when the United States is a plaintiff is fairly straightforward.

§1345. United States as plaintiff

Except as otherwise provided by Act of Congress, the district courts shall have original jurisdiction of all civil actions, suits or proceedings commenced by the United States, or by any agency or officer thereof expressly authorized to sue by Act of Congress.

(June 25, 1948, ch. 646, 62 Stat. 933.)

United States as defendant

The statute providing for subject matter jurisdiction when the United States is a defendant is much more intricate.

§1346. United States as defendant

(a) The district courts shall have original jurisdiction, concurrent with the United States Court of Federal Claims, of:

(1) Any civil action against the United States for the recovery of any internal-revenue tax alleged to have been erroneously or illegally assessed or collected, or any penalty claimed to have been collected without authority or any sum alleged to have been excessive or in any manner wrongfully collected under the internal-revenue laws;

(2) Any other civil action or claim against the United States, not exceeding $10,000 in amount, founded either upon the Constitution, or any Act of Congress, or any regulation of an executive department, or upon any express or implied contract with the United States, or for liquidated or unliquidated damages in cases not sounding in tort, except that the district courts shall not have jurisdiction of any civil action or claim against the United States founded upon any express or implied contract with the United States or for liquidated or unliquidated damages in cases not sounding in tort which are subject to sections 7104(b)(1) and 7107(a)(1) of title 41. For the purpose of this paragraph, an express or implied contract with the Army and Air Force Exchange Service, Navy Exchanges, Marine Corps Exchanges, Coast Guard Exchanges, or Exchange Councils of the National Aeronautics and Space Administration shall be considered an express or implied contract with the United States.

(b)(1) Subject to the provisions of chapter 171 of this title, the district courts, together with the United States District Court for the District of the Canal Zone and the District Court of the Virgin Islands, shall have exclusive jurisdiction of civil actions on claims against the United States, for money damages, accruing on and after January 1, 1945, for injury or loss of property, or personal injury or death caused by the negligent or wrongful act or omission of any employee of the Government while acting within the scope of his office or employment, under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred.

(2) No person convicted of a felony who is incarcerated while awaiting sentencing or while serving a sentence may bring a civil action against the United States or an agency, officer, or employee of the Government, for mental or emotional injury suffered while in custody without a prior showing of physical injury or the commission of a sexual act (as defined in section 2246 of title 18).

(c) The jurisdiction conferred by this section includes jurisdiction of any set-off, counterclaim, or other claim or demand whatever on the part of the United States against any plaintiff commencing an action under this section.

(d) The district courts shall not have jurisdiction under this section of any civil action or claim for a pension.

(e) The district courts shall have original jurisdiction of any civil action against the United States provided in section 6226, 6228(a), 7426, or 7428 (in the case of the United States district court for the District of Columbia) or section 7429 of the Internal Revenue Code of 1986.

(f) The district courts shall have exclusive original jurisdiction of civil actions under section 2409a to quiet title to an estate or interest in real property in which an interest is claimed by the United States.

(g) Subject to the provisions of chapter 179, the district courts of the United States shall have exclusive jurisdiction over any civil action commenced under section 453(2) of title 3, by a covered employee under chapter 5 of such title.

(June 25, 1948, ch. 646, 62 Stat. 933; Apr. 25, 1949, ch. 92, §2(a), 63 Stat. 62; May 24, 1949, ch. 139, §80(a), (b), 63 Stat. 101; Oct. 31, 1951, ch. 655, §50(b), 65 Stat. 727; July 30, 1954, ch. 648, §1, 68 Stat. 589; Pub. L. 85–508, §12(e), July 7, 1958, 72 Stat. 348; Pub. L. 88–519, Aug. 30, 1964, 78 Stat. 699; Pub. L. 89–719, title II, §202(a), Nov. 2, 1966, 80 Stat. 1148; Pub. L. 91–350, §1(a), July 23, 1970, 84 Stat. 449; Pub. L. 92–562, §1, Oct. 25, 1972, 86 Stat. 1176; Pub. L. 94–455, title XII, §1204(c)(1), title XIII, §1306(b)(7), Oct. 4, 1976, 90 Stat. 1697, 1719; Pub. L. 95–563, §14(a), Nov. 1, 1978, 92 Stat. 2389; Pub. L. 97–164, title I, §129, Apr. 2, 1982, 96 Stat. 39; Pub. L. 97–248, title IV, §402(c)(17), Sept. 3, 1982, 96 Stat. 669; Pub. L. 99–514, §2, Oct. 22, 1986, 100 Stat. 2095; Pub. L. 102–572, title IX, §902(b)(1), Oct. 29, 1992, 106 Stat. 4516; Pub. L. 104–134, title I, §101[(a)] [title VIII, §806], Apr. 26, 1996, 110 Stat. 1321, 1321–75; renumbered title I, Pub. L. 104–140, §1(a), May 2, 1996, 110 Stat. 1327; Pub. L. 104–331, §3(b)(1), Oct. 26, 1996, 110 Stat. 4069; Pub. L. 111–350, §5(g)(6), Jan. 4, 2011, 124 Stat. 3848; Pub. L. 113–4, title XI, §1101(b), Mar. 7, 2013, 127 Stat. 134.)

Forum non conveniens

Even if a civil action has been commenced in a district court which has subject matter jurisdiction, personal jurisdiction and proper venue, the court may transfer the case to another district court if it determines that the alternate location is a more convenient forum to try the case. Consider the following excerpt from Title 28 (which is sometimes referred to as the federal version of the doctrine of forum non conveniens):

§1404. Change of venue

(a) For the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought or to any district or division to which all parties have consented.

* * *

You may recall that, in Lecture 1, you briefly considered statutes which allow the parties to a contract to specify the forum in which disputes will be heard. Such clauses in contracts often are referred to as “forum selection clauses.” It might interest you to know that, in federal district court, there is a proper way and an improper way for a party to seek enforcement of a forum selection clause. A forum selection clause may not be enforced by making a motion to dismiss under 28 U.S.C. sec. 1406(a) or Federal Rule of Civil Procedure 12(b)(3) (which would be made when venue is wrong or improper). Technically, venue in a particular court may be proper even if the parties have agreed that the case should be heard in another court. Rather, the forum selection clause may be enforced by making a motion to transfer under sec. 1404(a) above. (Note, this procedure applies when the forum selected is another federal district court. It is less clear how to proceed if the forum selected is a state court or a foreign tribunal, though perhaps a motion might be made under Federal Rule of Civil Procedure 12(b)(6).) These issues are discussed in detail in Atlantic Marine Construction Co. v. U.S. District Court for the Western District of Texas, a U.S. Supreme Court case. Though this may seem like an overly technical and detailed issue (particularly for the start of class), I think it is worth considering because many of you will deal with forum selection clauses on a regular basis in private practice. They are important in the real world and it is worth knowing some technical details about how they work so, if asked by a client, you will appear knowledgeable. You will learn more about motion practice in Lecture 6 when we consider how a case moves through the federal courts.

Florida courts also may dismiss cases based on the doctrine of forum non conveniens—which is interpreted in the same manner as the federal statute. Consider the Florida Supreme Court's decision in Rabie Cortez v. Palace Resorts, Inc. for a recent discussion of this doctrine. For an overview of this case, and some background on the importance and reasons for the doctrine of forum non conveniens, read Florida Supreme Court Rejects Reverse Forum Shopping Through Invocation of the Forum Non Conveniens Doctrine, National Law Review (June 27, 2013).

Review outline and questions from the Federal Judicial Center:

What is a court?

A court is an institution that the government sets up to settle disputes through a legal process. Did Bill Jones run a red light before his car ran into John Smith’s, or was the light green, as he says it was? Did Frank Williams rob the bank? Courts decide what really happened and what should be done about it. They decide whether a person committed a crime and what the punishment should be. They also provide a peaceful way to decide private disputes that people can’t resolve themselves.

Courts use the adversary process to help them reach a decision. Through this process, each side presents its most persuasive arguments to the fact finder (judge or jury) and emphasizes the facts that support its case. Each side also draws attention to any flaws in its opponent’s arguments. The fact finder then decides the case. American judicial tradition holds that the truth will be reached most effectively through this adversary process.

There are two kinds of courts in the federal court system: the trial court and the appellate court. The trial court's basic function is to resolve disputes by determining the facts and applying legal principles to decide who is right. The appellate court's task is to determine whether the law was applied correctly in the trial court.

The decision of a court may affect many people besides those involved in the lawsuit. For example, the Supreme Court’s decision in the 1954 case Brown v. Board of Education, that it was unconstitutional to require white children and black children to attend separate schools, meant not only that plaintiff Linda Brown could enroll in a formerly all-white school, but also that other African-American children could too. (Of course, this didn’t happen overnight; court orders implementing the decision were not always obeyed.) Court decisions not only tell those involved in the case what their rights are, but also tell other people how the courts would probably decide similar cases. When a decision is made by a court with a broad geographic reach, such as the U.S. Supreme Court or the supreme court of a state, it can provide guidance to people who are considering legal action and may help them resolve their dispute without going to court.

How is a federal court different from a state court?

There are two kinds of courts in this country--federal courts and state courts.

Federal courts are established under the U.S. Constitution by Congress to decide disputes involving the Constitution and laws passed by Congress. State and local courts are established by a state (within states there are also local courts that are established by cities, counties, and other municipalities, which we are including in the general discussion of state courts).

The differences between federal courts and state courts are further defined by jurisdiction. Jurisdiction refers to the kinds of cases a court is authorized to hear.

Federal court jurisdiction is limited to the types of cases listed in the Constitution and specifically provided for by Congress. For the most part, federal courts only hear

  • cases in which the United States is a party;

  • cases involving violations of the U.S. Constitution or federal laws (under federal-question jurisdiction);

  • cases between citizens of different states if the amount in controversy exceeds $75,000 (under diversity jurisdiction); and

  • bankruptcy, copyright, patent, and maritime law cases.

State courts, in contrast, have broad jurisdiction, so the cases individual citizens are most likely to be involved in--such as robberies, traffic violations, broken contracts, and family disputes--are usually tried in state courts. The only cases state courts are not allowed to hear are lawsuits against the United States and those involving certain specific federal laws: criminal, antitrust, bankruptcy, patent, copyright, and some maritime law cases.

In many cases, both federal and state courts have jurisdiction. This allows parties to choose whether to go to state court or to federal court.

Criminal cases involving federal laws can be tried only in federal court, but most criminal cases involve violations of state law and are tried in state court. We all know, for example, that robbery is a crime, but what law says it is a crime? By and large, state laws, not federal laws, make robbery a crime. There are only a few federal laws about robbery, such as the law that makes it a federal crime to rob a bank whose deposits are insured by a federal agency. Examples of other federal crimes are bringing illegal drugs into the country or across state lines and use of the U.S. mails to swindle consumers. Crimes committed on federal property, such as national parks or military reservations, are also prosecuted in federal court.

Federal courts may also hear cases concerning state laws if the issue is whether the state law violates the federal Constitution. Suppose a state law forbids slaughtering animals outside of certain limited areas. A neighborhood association brings a case in state court against a defendant who sacrifices goats in his backyard. When the court issues an order (called an injunction) forbidding the defendant from further sacrifices, the defendant challenges the state law in federal court as an unconstitutional infringement of his religious freedom.

Some kinds of conduct are illegal under both federal and state laws. For example, federal laws prohibit employment discrimination, and the states have added their own laws. A person can go to federal or state court to bring a case under the federal law or both the federal and state laws. A case that only involves a state law can be brought only in state court.

Appeals for review of actions by federal administrative agencies are also federal civil cases. Suppose, for example, that the Environmental Protection Agency issued a permit to a paper mill to discharge water used in its milling process into the Scenic River, over the objection of area residents. The residents could ask a federal court of appeals to review the agency’s decision.

How do federal courts know what procedures to follow?

Federal rules of procedure govern the various types of court proceedings. They are as follows:

Federal Rules of Civil Procedure (Fed. R. Civ. P.);

Federal Rules of Criminal Procedure (Fed. R. Crim. P.);

Federal Rules of Appellate Procedure (Fed. R. App. P.);

Federal Rules of Bankruptcy Procedure (Fed. R. Bankr. P.); and

Federal Rules of Evidence (Fed. R. Evid.).

The rules were developed by the federal courts, with the authorization of Congress. Although all federal courts follow these rules, each district court, bankruptcy court, and court of appeals, as well as the U.S. Supreme Court, has also developed its own local rules. Courts develop local rules to clarify local practices and procedures. The local rules can’t contradict the federal rules, but they fill in details that are left open in the federal rules. For example, the Federal Rules of Civil Procedure provide general rules for how a party can start a lawsuit and how the other party answers; some districts’ local rules provide more specifics, including even requirements for the kind of paper to be used for court filings.

The federal court system can be compared to a patchwork quilt, with all courts laid out in an orderly manner but each one having some differences from all the others. The differences are not surprising in light of the large size of the federal system and the impact of local legal practices on individual courts.

Review Questions

1. Melvin Blue entered a federally insured bank and robbed money from the safe. Where will this case be filed?

Your answer: ___federal; ___ state; ___ either.

2. Two weeks later, Blue robbed a man who had just taken money out of an ATM machine in a grocery store. Where will this case be filed?

Your answer: ___federal; ___ state; ___ either.

3. Mary Brown works for ABC Corp.; she claims that her boss refused to promote her because she is a woman. Where will Mary Brown file this case?

Your answer: ___federal; ___ state; ___ either.

4. True or false? There are two kinds of courts in the federal court system: the trial court and the Supreme Court.

Your answer: ___ True: ___False.

5. True or false? A civil suit can be brought in either a federal or state court.

Your answer: ___ True: ___False.

6. True or false? A person accused of a crime is generally charged in a formal accusation. The name of this accusation for a misdemeanor is called an indictment.

Your answer: ___ True: ___False.

7. True or false? An indvidual facing bankruptcy has two options: liquidation or reorganization. Under liquidation, the individual is not allowed to keep any property if the amount of debt is greater than the amount of personal property.

Your answer: ___ True: ___False.

8. True or false. "Of all court cases filed annually in this country, for every federal case filed, thirty are filed in state courts."

Your answer: ___ True: ___False.






Last Modified: Tuesday, 09-Aug-2016 07:53:57 EDT