C H A P T E R 3
Sources of Law, Courts and Dispute Resolution
TRUE-FALSE QUESTIONS
1. Federal judges are appointed for ten year renewable terms.
2. Court opinions are published in collections of court opinions called reporters.
3. A cite such as 2004 WL 1208516 may be found on Westlaw.
4. Both the U.S. Congress and state legislatures may adopt statutes.
5. There is no minimum monetary requirement for lawsuits involving a federal question.
6. For diversity jurisdiction to exist there must be litigants from at least three different states.
7. Jurisdiction over the location of property at issue in a lawsuit is called in rem jurisdiction.
8. Negotiating business contracts by means of telephone calls or the mail is insufficient to provide a state court
with personal jurisdiction over an individual so long as the individual is out–of-state when such contacts are
made.
9. A federal court of appeals in one circuit must follow an earlier decision on an issue made by a federal court
of appeals in another circuit.
10. Cases involving federal question jurisdiction may be brought in state court, but the defendant has the right to
remove the case to federal court.
11. The process of questioning the witnesses is called voir dire.
12. Jury challenges for cause are called preemptory challenges.
13. Cases before federal courts of appeal are usually presented before a panel of nine judges.
14. There are thirteen federal courts of appeal.
15. A case involving an appeal from a decision of the Court of Federal Claims would be heard by the Court of
Appeals for the Federal Circuit.
16. The Supreme Court has found a national policy expressed by Congress disfavoring arbitration agreements.
17. A judge is always compelled to follow Restatements of law in making a decision.
18. When a lawsuit is originally filed, the case name appears as appellant v appellee.
19. The process of questioning potential jurors is called discovery.
20. When a class action is involved, there is no opportunity for someone who wants to litigate separately to opt
out.
MULTIPLE CHOICE QUESTIONS
1. What is the inscription on the front of the U.S. Supreme Court building in Washington, D.C.?
A. Live free or die
B. Equal justice under the law
C. Due Process for all
D. Equal protection for all
2. Which of the following are rules that prescribe which state’s law should be applied to a particular kind of
case?
A. Conflict-of-dispute rules
B. Conflict-of-law rules
C. Litigant rules
D. Forum-shopping rules
CHAPTER 3 COURTS, SOURCES OF LAW, AND DISPUTE RESOLUTION 35
3. Which of the following is true regarding citizenship of an individual for purposes of diversity jurisdiction in
federal court?
A. An individual is a citizen of the state where that person has his or her legal residence or domicile, and
there is no limit to the number of states in which an individual may be a citizen so long as the individual has
a house in every state in which citizenship is claimed.
B. An individual is a citizen of the state where that person has his or her legal residence or domicile, and an
individual may be a citizen of only one state.
C. An individual is a citizen of the state where that person has his or her legal residence or domicile, and an
individual may be a citizen in a maximum of two states.
D. An individual is considered a citizen of the state in which a lawsuit is brought because the individual
becomes subject to that state’s laws.
4. Which of the following was Congress’s first piece of legislation?
A. “An Act to Establish the Judicial Courts of the United States”
B. “An Act Authorizing the Declaration of War”
C. “An Act Establishing Independent State Governments”
D. “An Act Authorizing the Establishment of a Supreme Court”
5. When it decides to hear a case, the U.S. Supreme Court issues a ____________ ordering the lower court to
certify the record of proceedings below and send it up to the Supreme Court.
A. commandment
B. writ of order
C. writ of certiorari
D. writ of expo facto
6. Which of the following are provisions issued by federal and state administrative agencies and executive
departments to interpret and implement statutes enacted by a legislature?
A. Regulations
B. Interpretations
C. Reviews
D. Acknowledgements
7. The critical test under the Due Process Clause in determining whether jurisdiction over an out–of-state
defendant exists is:
A. Whether the defendant has certain minimum contacts with the state such that the maintenance of the suit
does not offend traditional notions of fair play and substantial justice.
B. Whether the out-of-state defendant has ever visited the state.
C. Whether the out-of-state defendant has certain minimum contacts with the state such that maintenance of
the suit does not offend liberty concepts.
D. Whether the out-of-state defendant has ever lived in the state.
8. Case law, the legal rules made by judges when they decide a case where no constitution, statute or regulation
exists to resolve the dispute, is known as ________.
A. English law
B. Civil law
C. Common law
D. Disputed law
9. An affirmative defense ________ that the defendant has acted in a certain way but claims that the
defendant’s conduct was not the legal cause of harm to the plaintiff.
A. admits
B. denies
C. neither admits nor denies
D. may either admit or deny
10. In 2002 the European Union adopted the _____________ to standardize the rules for determining where
suits involving e-commerce may be brought.
A. Brussels Conventions
B. European E-commerce Rules
C. European Commerce Standards
D. French Conventions
11. Assuming that more than one forum has jurisdiction over a lawsuit, the doctrine of ____________ involves a
determination of which forum is more appropriate.
A. Jurisdiction non conveniens
B. Convenient state proceeding
C. Forum non conveniens
CHAPTER 3 COURTS, SOURCES OF LAW, AND DISPUTE RESOLUTION 37
D. Subject matter jurisdiction
12. The ______________ control the civil trial practices in all of the U.S. district courts.
A. Federal Rules of Civil Procedure
B. Universal Rules of Civil Procedure
C. National Rules of Civil Court Conduct
D. Common Rules of Civil Procedure
13. The _____________ officially notifies a defendant that a lawsuit is pending and that a response to the
complaint must be filed within a certain number of days.
A. Subpoena
B. Summons
C. Complaint
D. Suggestion
14. A ______ action is brought by a representative of many people suffering the same harm.
A. Conglomerate
B. Group
C. Representative
D. Class
15. The party appealing a case is referred to as which of the following?
A. Plaintiff
B. Respondent
C. Appellee
D. Appellant
16. The two coexisting judicial systems are a result of the ______ created by the U.S. Constitution, which gives
certain powers to the federal government while reserving other powers to the states.
A. standing
B. diversity
38 MANAGERS AND THE LEGAL ENVIRONMENT
C. duality
D. federalism
17. If the defendant does not file an answer within the time required, a(n) ____________ may be entered in
favor of the plaintiff.
A. default judgment
B. answer pro se
C. concession judgment
D. coercive judgment
18. A lawsuit may be resolved before trial by the judge granting a[n]
A. judgment notwithstanding the verdict
B. interlocutory judgment
C. motion to dismiss
D. request for production of documents
19. The doctrine of stare decisis means
A. to abide by decided cases
B. let the courts decide
C. let the superior argument prevail
D. to decide the case on its merits
20. A judge will grant a motion to dismiss the complaint on all but the following grounds:
A. The plaintiff has failed to state a claim on which relief can be granted.
B. The court lacks jurisdiction over the subject matter or the parties involved.
C. The plaintiff has failed to offer the defendant an offer of settlement.
D. The plaintiff has failed to properly serve the complaint on the defendant.
21. A motion for summary judgment will be granted where there is no triable issue of
A. fact
B. law
C. evidence
CHAPTER 3 COURTS, SOURCES OF LAW, AND DISPUTE RESOLUTION 39
D. fact, law, or evidence
22. Diversity jurisdiction exists when
A. a lawsuit is between citizens of different states.
B. the amount in controversy, exclusive of interest and all costs, exceeds $75,000.
C. either that a lawsuit is between citizens of different states or the amount in controversy, exclusive of
interest and all costs, exceeds $75,000.
D. both that a lawsuit is between citizens of different states and that the amount in controversy, exclusive of
interest and all costs, exceeds $75,000.
23. Under the ________ doctrine, the outcome of a diversity case in federal court will be similar to the outcome
in a state court because the same substantive law will govern either adjudication.
A. Erie
B. common law
C. venue
D. total activity
24. For diversity purposes, a corporation is deemed a citizen of
A. the state of incorporation.
B. the state of its principal place of business.
C. either the state of incorporation or the state of its principal place of business, but not both.
D. both the state of incorporation and the state of its principal place of business.
25. Which of the following is a term referencing the method used for determining the citizenship of a
corporation for purposes of diversity of citizenship?
A. The locality determination
B. The nerve-center test
C. The prime location test
D. The conflict determination
26. The ______ Amendment to the U.S. Constitution generally protects a state (or an agency thereof) from
being sued without its consent in a federal court.
A. Second
B. Eleventh
C. Fifteenth
D. Twenty-first
27. Which of the following was the result at the U.S. Supreme Court level in Wal-Mart Stores, Inc. v. Dukes,
the case in the text involving the issue of whether the plaintiffs could proceed with a class action against
Wal-Mart alleging sex discrimination?
A. That the plaintiffs would be allowed additional time to establish beyond a reasonable doubt that at least
50% of the plaintiffs involved had suffered sex discrimination at which point a class would be certified.
B. That the issue of whether a class action was appropriate was an issue for the jury’s determination.
C. That a class action was appropriate because the plaintiffs had established that the company operated
under a general policy of discrimination.
D. That a class action was inappropriate because the plaintiffs had failed to show that the company operated
under a general policy of discrimination.
28. Most states have ________ statutes, which can subject an out-of-state defendant to jurisdiction within the
state.
A. in personam
B. in rem
C. long-arm
D. diversity
29. A ________ reverses the jury verdict on the ground that the evidence of the prevailing party was so weak
that no reasonable jury could have resolved the dispute in that party’s favor
A. directed verdict
B. summary judgment
C. judgment n.o.v.
D. judgment on the pleadings
30. Which of the following is true regarding age and citizenship requirements of federal judges?
A. There are no age requirements nor is there any requirement that a federal judge be a naturally born
citizen.
B. There are no age requirements but there is a requirement that a federal judge be a naturally born citizen.
CHAPTER 3 COURTS, SOURCES OF LAW, AND DISPUTE RESOLUTION 41
C. A federal judge must be at least 45, but there is no requirement that a federal judge be a naturally born
citizen.
D. A federal judge must be at least 45 and also a natural born citizen.
Fact Pattern 3-1 (questions 31-32 apply). Bruce lived in Tennessee and had an appliance store in Tennessee.
Bruce’s residence and the appliance store, however, were within twenty miles of the Virginia state line.
Bruce advertised heavily in both Tennessee and Virginia. Susan, one of his customers from Virginia, had an
unfortunate experience with a refrigerator purchased from Bruce in that the refrigerator caught on fire and
burned down Susan’s house which was worth $200,000. Susan obtained proof that the refrigerator had
actually been returned to Bruce because it malfunctioned and that, rather than repair the refrigerator and sell
it as used, Bruce sold the refrigerator to her as new without repairs. Susan sued Bruce in federal district
court in Virginia on a number of theories. Bruce opposed the lawsuit on the basis that it could only be filed
in a state court and also on the basis that he was not subject to jurisdiction in Virginia.
31. Refer to fact pattern 3-1. Which of the following is the most likely result in regard to Bruce’s claim that the
lawsuit could only be appropriately filed in a state court?
A. The court would likely rule that federal court jurisdiction failed to exist because the parties were not all
residents of the same state.
B. The court would likely rule that federal court jurisdiction failed to exist because the amount in
controversy was excessive..
C. The court would likely rule that federal court jurisdiction existed based on the presence of a consumer
complaint.
D. The court would likely rule that federal court jurisdiction existed based on diversity of citizenship.
32. Refer to fact pattern 3-1. Which of the following is the most likely result in regard to Bruce’s claim that he
was not subject to jurisdiction in a court located in Virginia?
A. Bruce would not be subject to jurisdiction in a Virginia court because he did not live there nor was his
store located there.
B. Bruce would not be subject to jurisdiction in a Virginia court because a consumer complaint was
involved, not a dispute involving two business entities.
C. Bruce would be subject to the jurisdiction of courts in Virginia because Tennessee borders Virginia, and
federal courts have jurisdiction over citizens from any surrounding state.
D. Bruce would be subject to the jurisdiction of courts in Virginia because his contacts with the state were
such that maintenance of the suit would not offend traditional notions of fair play and substantial justice.
Fact Pattern 3-2 (questions 33-34 apply)
Sally tells you that she is in a dispute with her employer regarding whether in denying Sally a promotion she
wanted, the employer committed sex discrimination. Sally says that she has heard about both mediation and
42 MANAGERS AND THE LEGAL ENVIRONMENT
arbitration and asks you which would result in a quicker judgment in her favor because she does not
particularly want to go to the time and expense of a court action. Sally also asks if, as a friend, you will go
with her when she consults with a lawyer.
33. Refer to fact pattern 3-2. What would you tell Sally regarding whether she should choose mediation or
arbitration?
A. That mediation and arbitration are essentially the same thing.
B. That a mediator would actually decide the case whereas an arbitrator would not.
C. That an arbitrator would actually decide the case whereas a mediator would not.
D. That both an arbitrator and a mediator would decide the case but that an arbitrator is required to be a
lawyer whereas a mediator is not.
34. Refer to fact pattern 3-2. What would you tell Sally regarding her request that you go with her, as her
friend, to see her lawyer?
A. That you would be glad to do so because you want to provide emotional support.
B. That you should not go because your presence would destroy the attorney-client privilege.
C. That you should not go because your presence would destroy the work-product privilege.
D. That you should not go because your presence would destroy both the attorney-client privilege and the
work-product privilege.
35. Robert had a dispute with his neighbor regarding the location of the property line. Robert’s attorney
suggests to Robert that both parties contribute funds toward hiring individuals to serve on a nonbinding jury
and render a suggested verdict. Which of the following is the appropriate term for that type of procedure?
A. Summary jury trial
B. Nonbinding jury trial
C. Private jury trial
D. Procedural jury trial
ESSAY QUESTIONS
1. Under what circumstances should a judge grant a motion for summary judgment?
2. Set forth when courts in the United States will honor a choice-of-forum clause.
3. Explain how a federal court hearing a diversity case would apply conflict–of -law rules.
4. Federal courts are commonly referred to as courts of limited jurisdiction. Over what three types of cases do
federal district courts have jurisdiction?
5. Discuss what types of material is covered by the attorney work-product doctrine and explain the rationale
behind it.
6. What is the process of selecting the jury called? What two types of challenges to jurors can be made? For
what two reasons is it unconstitutional to remove a juror?