1. Mon., Dec. 3

2. issue preclusion

3. if in an earlier case an issue was - actually litigated and decided - litigated fairly and fully - and essential to the decision then the earlier determination of the issue precludes relitigation of the same issue by someone who was a party (or in privity with a party) in the earlier litigation

4. Ohio Georgia still have the mutuality requirement

5. Virginia (and some other states)… allow only defensive nonmutual issue preclusion

6. federal and some states also allow offensive nonmutual issue preclusion under certain circumstances plaintiff in second suit was not a party in first suit and uses issue preclusion as a sword

7. Since a plaintiff will be able to rely on a previous judgment against a defendant but will not be bound by that judgment if the defendant wins, the plaintiff has every incentive to adopt a "wait and see" attitude, in the hope that the first action by another plaintiff will result in a favorable judgment. Thus offensive use of collateral estoppel will likely increase rather than decrease the total amount of litigation, since potential plaintiffs will have everything to gain and nothing to lose by not intervening in the first action.

8. A second argument against offensive use of collateral estoppel is that it may be unfair to a defendant. If a defendant in the first action is sued for small or nominal damages, he may have little incentive to defend vigorously, particularly if future suits are not foreseeable. Allowing offensive collateral estoppel may also be unfair to a defendant if the judgment relied upon as a basis for the estoppel is itself inconsistent with one or more previous judgments in favor of the defendant. Still another situation where it might be unfair to apply offensive estoppel is where the second action affords the defendant procedural opportunities unavailable in the first action that could readily cause a different result. 

9. - X (a domiciliary of Nevada) established a trust for the benefit of twin brothers: P (a domiciliary of Oregon) and Y (a domiciliary of Oregon) - upon reaching the age of 50, P will receive 75% and Y 25% of the value of the trust - at the age of 25, P sued the trustee of the trust, D (a domiciliary of Nevada), in the federal district court for Northern District of Georgia - P alleged that D wrongly claimed ownership of a $200,000 parcel of land in the Northern District of Georgia (the land, P argued, belonged to the trust) - Y testified as a witness in the case - the jury determined that the land is in fact D’s and the federal court issued a judgment for D - soon afterward, D died and Z inherited his estate - within a year, Y sued Z in state court in Georgia - Y claims that the $200,000 property that Z inherited in fact belongs to the trust - Z claims that Y is issue precluded from relitigating whether the property belongs to the trust - how should the state court rule?

10. one sovereign’s law in another sovereign’s courts…

11. a federal court entertains a state law action, or action under the law of a foreign nation a state court entertains a federal action, or sister state action, or action under the law of a foreign nation

12. how to interpret the other sovereign’s law?

13. Swift v. Tyson Black & White Taxicab if a state’s officials have chosen to adopt the general common law, a federal court will come to its own conclusion about what the general common law standard in the state is, without deferring to the state’s courts

14. that was probably what the state’s courts themselves wanted at the time they would not defer to what sister state courts said about the general common law in the sister state

15. but over time most state courts began understanding the common law standards applying in their state as whatever their state’s courts said they were

16. Erie RR v. Tompkins a federal court applying state law (e. g
Erie RR v. Tompkins a federal court applying state law (e.g. when sitting in diversity or supplemental jurisdiction) should defer to the state’s courts concerning the content of the state’s law this includes the state’s common law

17. “There is no general federal common law.”

18. how should a federal court defer to a state’s courts concerning the state’s law?

19. act like a lower state court?

20. imagine there is an old state SCt decision saying “X,” which the state SCt is likely to overrule state court system federal court system state SCt: “not-X” fed Ct App: “X” state Ct App: “X” fed Dist. Ct. “X” state trial ct: “X”

21. instead… predictive method (also commonly used by state courts for sister-state law)

22. or certification…

23. choice of law

24. choice of “substantive” law in state court choice between: - two states’ laws (Nevada or California?) - two countries’ laws (Germany or Brazil?) - a state’s law and a country’s law (Germany or California?)

25. what about a choice between federal law and a state’s law?

26. two married Georgians get into an accident in California the husband wishes to sue the wife for negligence Ga. law – spousal immunity Ca. law – spousal negligence liability

27. assume the case is before a Virginia (or Ga
assume the case is before a Virginia (or Ga.) state court… lex loci delicti the tort law of the place of the harm applies the court would apply California law and allow the husband’s action to proceed

28. assume the case is before a Pennsylvania (or Ca
assume the case is before a Pennsylvania (or Ca.) state court… interest analysis concerning spousal immunity, the law of the place of the marital domicile applies the court would apply Georgia law and bar the husband’s action

29. horizontal choice of “procedural” law one Californian kills another Californian in an accident in California a Virginia state court is entertaining the California wrongful death action should it use Virginia’s or California’s: statute of limitation? service rules? pleading standards?

30. an understanding of a rule’s being substantive or procedural by looking to the views of the officials of the state that created the rule

31. “substantive” = the officials of the state that created the rule want it to be used by other court systems - e.g. they consider it part of the state’s cause of action, following those actions into other court systems “procedural” = the officials of the state that created the rule want it to apply only in the state’s own courts, including to causes of action under other states’ laws

32. some ”substantive” law is not bound up with a cause of action… one Californian kills another Californian in an accident in California a Virginia state court is entertaining the California wrongful death action the California defendant has a Nevada lawyer and speaks to the lawyer in Nevada about the case which attorney-client privilege law applies? Cal? Va? Nev?

33. but sometimes a rule that appears to be about court administration is actually “substantive” in the sense that the officials that created it want it to follow their cause of action into other court systems

34. - California’s wrongful death statute says “a plaintiff may not sue for wrongful death under this statute more than 2 years after the death occurs”

35. in general, how can you tell whether a statute of limitations is substantive or procedural? will there be any California state court decisions on point?

36. imagine a California court applies its statute of limitations to actions under another state’s (or nation’s) law

37. conflicts of substance and procedure

38. P sues D in Virginia state court under California law for wrongful death 2.5 years after the death Va’s WD time limitation Ca’s WD time limitation 2-yr substantive 3-yr substantive 2-yr procedural 3-yr procedural 2-yr procedural 3-yr substantive 3-yr procedural 2-yr substantive 2-yr substantive 3-yr procedural

39. P sues D in Virginia state court under California law for wrongful death California has a service rule that it considers bound up with its wrongful death statute must Virginia law yield to it?

40. so where do we stand for horizontal substance/procedure questions?

41. service rules: procedural

42. statutes of limitations… traditional view: presumptively procedural bur sometimes substantive (bound up with cause of action), with forum procedure yielding to another jurisdiction’s substance

43. P sues D in state court in Virginia under New York negligence law New York law puts the burden of proof on the plaintiff to show his lack of contributory negligence under Virginia law contributory negligence is an affirmative defense what result?

44. burdens of proof: presumptively substantive but could be procedural, with forum procedure yielding to another jurisdiction’s substance

45. applying another jurisdiction’s substantive law vs
applying another jurisdiction’s substantive law vs. incorporating a standard from another jurisdiction’s law into forum law

46. MO state courts have a generous 3 year statute of limitations for tort too many people are coming to MO state court to sue under sister state causes of action so MO enacts a borrowing statute: the MO statute of limitations for tort incorporates the time period of the state that provides the cause of action

47. now…

48. what is federal power over procedure when a federal court is entertaining a state law cause of action?

49. federal constitutional law governing procedure in federal court…

50. Seventh Amendment In Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law.

51. P sues D under Virginia law in federal court in Virginia under the 7th Amendment, a factual issue must be decided by a jury in federal court under Virginia law, it does not which law applies, Virginia or federal?

52. federal common law governing procedure in federal court - ignore federal statutes and FRCPs

53. P sues D in federal court in New York under New York negligence law New York law puts the burden of proof on the plaintiff to show his lack of contributory negligence can the federal court use a federal common law rule making contributory negligence an affirmative defense instead?

54. Palmer v. Hoffman (US 1943) also Cities Service Oil Co. v
Palmer v. Hoffman (US 1943) also Cities Service Oil Co. v. Dunlap (US 1939)

55. Guaranty Trust v. York (U.S. 1945)

56. assume that a Pennsylvania state court was entertaining the NY actions in Guaranty Trust would NY’s or Pa’s statute of limitations/laches doctrine apply?

57. It is therefore immaterial whether statutes of limitation are characterized either as "substantive" or "procedural" in State court opinions in any use of those terms unrelated to the specific issue before us. Erie R. Co. v. Tompkins...expressed a policy that touches vitally the proper distribution of judicial power between State and federal courts. In essence, the intent of that decision was to insure that, in all cases where a federal court is exercising jurisdiction solely because of the diversity of citizenship of the parties, the outcome of the litigation in the federal court should be substantially the same, so far as legal rules determine the outcome of a litigation, as it would be if tried in a State court.

58. in Erie a Pa plaintiff sued a NY defendant in federal court in NY under Pa law what was important – acting like a NY state court? or acting like a Pa state court?

59. policy of vertical uniformity between federal and forum state court (if outcome determinative)

60. a federal court in Kansas is entertaining an action under Kansas law it uses Kansas statute of limitations, according to Guaranty Trust but, according to the federal law a statute of limitations is tolled upon filing under Kansas law, it is tolled upon service which rule should the federal court use?

61. Ragan v. Merchants Transfer & Warehouse (US 1949)

62. a Mississippi statute requires a corporation doing business within the state to designate an agent for the service of process before bringing suit in Mississippi state court there is no such requirement under federal law P (a Tennessee corporation doing business in Mississippi) is suing D in federal court in Mississippi under Mississippi law P has designated no agent for service of process in Miss. D moves for summary judgment on this ground what result?

63. the 5th Circuit had concluded that Mississippi state officials thought that the statute applied only Mississippi state courts, not federal courts in Mississippi. does that matter?

64. Woods v. Interstate Realty (US 1949)

65. incorporating state standards, not applying state law

66. a New Jersey statute requires small shareholders bringing derivative actions to post a bond federal courts have no such requirement P, a small shareholder, brings a derivative action under Delaware law against D in federal court in New Jersey P has not posted a bond D moves to dismiss what result?

67. Cohen v. Beneficial Indus. Loan Corp. (US 1949)

68. where we stand at this point: borrow forum state law if the difference between federal common law and forum state law is “outcome determinative”

69. should federal courts use their own common law choice of law rules?

70. Klaxon…

71. NY action in federal court in DE what prejudgment interest is used
NY action in federal court in DE what prejudgment interest is used? the fed ct treat the matter as substantive (governed by NY law) the US SCt held it must choose the law that a DE state court would

72. The conflict of laws rules to be applied by the federal court in Delaware must conform to those prevailing in Delaware’s state courts. Otherwise the accident of diversity of citizenship would constantly disturb equal administration of justice in coordinate state and federal courts sitting side by side.

73. Byrd v. Blue Ridge Rural Electric Corp. (US 1958)

74. First. It was decided in Erie R. Co. v
First. It was decided in Erie R. Co. v. Tompkins that the federal courts in diversity cases must respect the definition of state-created rights and obligations by the state courts. We must, therefore, first examine the [S.C.] rule...to determine whether it is bound up with these rights and obligations in such a way that its application in the federal court is required.

75. what is an example of a state rule where the bound-up test is satisfied?

76. Palmer v. Hoffman (US 1943)

77. P sues D in federal court under California law for wrongful death California has rule about the maximum number of pages in a brief that it considers bound up with its wrongful death statute must federal common law yield to it?

78. Second. But cases following Erie have evinced a broader policy to the effect that the federal courts should conform as near as may be--in the absence of other considerations--to state rules even of form and mode where the state rules may bear substantially on the question whether the litigation would come out one way in the federal court and another way in the state court if the federal court failed to apply a particular local rule. E.g., Guaranty Trust Co. of New York v. York.

79. But there are affirmative countervailing considerations at work here....

80. after Byrd: assume P sues D in federal court in New York under Pa law 1) if a Pa rule is bound up with the Pa cause of action the federal court must use the Pa rule instead of federal common law rule 2) but there is also a policy of vertical uniformity with NY state courts (if difference is outcome determinative) 3) there may also be countervailing federal interests in favor uniform federal common law rule, however 2) must be balanced against 3)

81. federal procedural common law - claim/issue preclusion - choice-of-law rules - anything that federal courts simply don’t do that a state does (whether by state constitution, statute, or common law)

82. what about Fed. R. Civ. P.? and federal statutes governing procedure in federal courts?

83. Hanna v. Plumer (U.S. 1965)

84. - Hanna sued Plumer, Osgood’s executor, for Osgood’s negligence in auto accident - left summons and complaint with Osgood’s executor’s wife at place of residence in accordance with 4(e) (4d at the time) - Mass statute required hand delivery to an executor or administrator - DCt granted motion for summary judgment - Ct App aff’d - outcome determinative - SCt reversed

85. “When a situation is covered by one of the Federal Rules, the question facing the court is a far cry from the typical, relatively unguided Erie choice: the court has been instructed to apply the Federal Rule, and can refuse to do so only if the Advisory Committee, this Court, and Congress erred in their prima facie judgment that the Rule in question transgresses neither the terms of the Enabling Act nor constitutional restrictions.”

86. why no concern about vertical uniformity when a FRCP is at issue
why no concern about vertical uniformity when a FRCP is at issue? why does vertical uniformity matter only when federal courts are creating federal procedural common law?

87. Green’s theory: the source of federal courts’ obligation to consider vertical uniformity when creating federal procedural common law in diversity cases comes from the purposes of the diversity statute

88. P(NY) sues D(Cal.) in state court in NY under NY law 2 ½ years after an accident D is worried about state-court bias against him NY has a 3-year statute of limitations what would happen if federal courts had a common law 2-year limitation period?

89. 28 U.S.C. § Rules of procedure and evidence; power to prescribe (a) The Supreme Court shall have the power to prescribe general rules of practice and procedure and rules of evidence for cases in the United States district courts (including proceedings before magistrate judges thereof) and courts of appeals. (b) Such rules shall not abridge, enlarge or modify any substantive right

90. what is Congress’s power over federal procedure?

91. “[T]he constitutional provision for a federal court system (augmented by the Necessary and Proper Clause) carries with it congressional power to make rules governing the practice and pleading in those courts, which in turn includes a power to regulate matters which, though falling within the uncertain area between substance and procedure, are rationally capable of classification as either.”

92. - Congress passes a uniform statute of limitations applicable for all actions in federal court, including state law actions - is the statute valid? - even if a shorter state statute of limitations is bound up with the state cause of action?

93. - pursuant to the order of a Florida state court (that was ultimately affirmed by the Florida Supreme Court), Terry Schiavo’s feeding tube was removed - the US SCt denied cert - In response, Congress passed Public Law 109-3, “An Act for the relief of the parents of Theresa Marie Schiavo” - this act allowed Ms. Schiavo's parents to bring an action in federal district court concerning whether their daughter's federal constitutional or statutory rights had been violated as a result of the Florida courts' orders - this meant not giving the Florida judgment Full Faith and Credit - constitutional?

94. 28 U.S.C. § Rules of procedure and evidence; power to prescribe (a) The Supreme Court shall have the power to prescribe general rules of practice and procedure and rules of evidence for cases in the United States district courts (including proceedings before magistrate judges thereof) and courts of appeals. (b) Such rules shall not abridge, enlarge or modify any substantive right

95. “The test must be whether a rule really regulates procedure,—the judicial process for enforcing rights and duties recognized by substantive law and for justly administering remedy and redress for disregard or infraction of them.” Sibbach v. Wilson & Co., 312 U.S. 1, 14.

96. now – assume that the federal service rule had been common law

97. “[I]t is doubtful that, even if there were no Federal Rule making it clear that in-hand service is not required in diversity actions, the Erie rule would have obligated the District Court to follow the Massachusetts procedure.”

98. “Not only are nonsubstantial, or trivial, variations not likely to raise the sort of equal protection problems which troubled the Court in Erie; they are also unlikely to influence the choice of a forum. The ‘outcome-determination’ test therefore cannot be read without reference to the twin aims of the Erie rule: discouragement of forum-shopping and avoidance of inequitable administration of the laws.”

99. twin aims of Erie

100. look back at old cases in light of Hanna’s rejection of the outcome determinative test...

101. could a federal court sitting in diversity create a judicially created limitations period different from that of the forum state? (Guaranty Trust)