Unlock document.
This document is partially blurred.
Unlock all pages and 1 million more documents.
Get Access
Chapter 02 - The Resolution of Private Disputes
CHAPTER 02
THE RESOLUTION OF PRIVATE DISPUTES
I. OBJECTIVES:
As its title suggests, this chapter is concerned with the resolution of disputes that give rise to civil
cases. For the most part, it is a nuts-and-bolts chapter intended to acquaint the student with
courts, their civil jurisdiction, and the procedures they use in civil cases. The chapter also
contains a discussion of alternative dispute resolution. After reading the chapter and attending
class, the student should:
A. Be familiar with the various kinds of state and federal courts and the common bases of their
trial and appellate jurisdiction;
B. Understand the various procedural steps in a civil case; and
C. Have knowledge of the significant forms of alternative dispute resolution and their
advantages and disadvantages.
The Learning Objectives that appear near the beginning of the chapter provide a further roadmap
for the chapter’s coverage.
II. ANSWERS TO INTRODUCTORY PROBLEM:
A. Wilson clearly may pursue her case in New Jersey, where the defendant corporation’s
principal offices are located. Depending upon how the applicable long-arm statute is worded
and upon whether constitutional principles of due process would be satisfied, Wilson may be
able to pursue the case in her own state, Illinois. See the chapter’s discussion of in personam
jurisdiction and the use and operation of long-arm statutes.
B. Wilson would not be restricted to suing in state court. She would have the option of suing in
federal court, either in an appropriate court in the district of New Jersey or in an appropriate
court in the district of Illinois (assuming in personam jurisdiction could be established on the
part of a federal court in the Illinois district) Again, see the chapter’s discussion of in
personam jurisdiction and the use and operation of long-arm statutes. The reason that federal
court would be an option for Wilson is that the requirements of diversity of citizenship
jurisdiction (one of the forms of subject matter jurisdiction in federal court) would be
satisfied. Wilson and XYZ are parties from different states, and there is more than $75,000 in
controversy. See the chapter’s discussion of diversity jurisdiction.
C. Assuming Wilson sues in state court, XYZ will have the option of removing the case to
federal court if XYZ acts promptly. XYZ has the power of removal because this would be a
case of concurrent jurisdiction--one that was properly brought in state court but could have
been brought in federal court (in this instance, because of the diversity jurisdiction principle
discussed above). See the chapter’s discussion of concurrent jurisdiction and the power of
removal.
D. The procedural steps are those outlined and discussed in the chapter’s section on civil
procedure (see text, pp. 39-46).
E. Yes, if the documents and e-mails are relevant to the case. See the discussion of legal and
ethical issues at pp. 41-43.
2-1
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 02 - The Resolution of Private Disputes
III. SUGGESTIONS FOR LECTURE PREPARATION:
A. State Courts and their Jurisdiction
1. This section's description of state courts themselves (as opposed to their jurisdiction)
probably can be dealt with briefly in class. Emphasize, however, that appellate courts
only decide questions of law, not fact. Of course, the line between fact and law is
indistinct, and appellate courts often consider legal issues with factual dimensions.
Examples include the trial court's evidentiary rulings, and its rulings on the motions for
summary judgment, directed verdict, and judgment not withstanding the verdict. See also
Problem #1.
2. With regard to state court jurisdiction:
a. Emphasize that this is based on the state's power. The various examples of state court
jurisdiction may generally be seen as reflecting a state's ability to issue binding legal
decisions that affect persons, property, and activities within the state’s borders.
b. Emphasize that for state trial courts to have jurisdiction in a civil case, both subject-
matter jurisdiction and either in rem or in personam jurisdiction are necessary. (Both
subject-matter jurisdiction and in personam jurisdiction are also necessary in federal
courts.)
c. Discuss the role that long-arm statutes may play in allowing a state court to have in
personam jurisdiction over a non-resident. Mention that federal courts may rely on
state long-arm statutes as a means of obtaining in personam jurisdiction over a
defendant who does not reside in the federal district where the litigation is being
pursued.
d. Note that according to the typical long-arm statute, a non-resident defendant may be
subjected to suit in the forum state if he, she, or it has: done business in the forum
state; contracted to supply goods or services in the forum state; committed a tort
within the state; or committed a tort outside the state, if the resulting damage occurs
within the state. (The chapter’s opening vignette/introductory problem may raise
issues along these lines.) The chapter states, at p. 30, that “[s]ome long-arm statutes
are phrased with even broader application in mind.” Note, therefore, that some long-
arm statutes allow the forum state’s in personam jurisdiction to extend to the full
limits of due process. (Once again, the chapter’s opening vignette/introductory
problem may raise issues along these lines.) When such a broad provision appears in
a long-arm statute, the due process inquiry merges with the due process analysis that
must be applied as a constitutional matter. As the text points out, the due process
analysis must always be applied--for constitutional reasons—even though the
provisions of the long-arm statute have been satisfied. This is true even if the long
arm statute does not contain a to-the-limit-of-due-process provision.
e. Abdouch v. Lopez (p. 30): The Supreme Court of Nebraska holds that the defendants,
a Massachusetts resident and his Massachusetts-based company, are not subject to the
in personam jurisdiction of a Nebraska court in a case that centered around
statements in an advertisement that appeared on the defendants’ website.
2-2
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 02 - The Resolution of Private Disputes
Points for Discussion: Note the court's discussion of specific jurisdiction:
jurisdiction over a defendant in a case arising out of or related to the defendant's contacts
with the forum. Emphasize that such jurisdiction can be acquired by a court over a
defendant who resides in a different state if the long-arm statute of the forum state and
the constitutional due process standard are both satisfied. After reviewing the categories
of non-resident defendants' behaviors that are typically covered by long-arm statutes (see
the text's discussion at p. 30), point out that some states' long-arm statutes contain a
provision allowing the statute's application, for in personam jurisdiction purposes, as far
as principles of due process will allow. The Nebraska long-arm statute, at issue in this
case, is such a statute. In such a situation, the statutory and constitutional issues merge
into a single due process inquiry in which the "minimum contacts" issue becomes critical.
Ask the students why the court concluded that the defendants did not possess the requisite
minimum contacts with Nebraska. Ask about the court's discussion of the Zippo test for
whether a defendant's website will or may support a determination that a state's court has
in personam jurisdiction over the defendant even though he, she, or it does not reside in
that state. Ask about the three categories of websites identified in Zippo, the effect of
each on the in personam jurisdiction issue, and what to make of the defendants’ website.
Note that the nature of the defendants’ website was a factor in the court's conclusion that
in personam jurisdiction did not exist regarding the defendants, but that it was not solely
determinative. Ask about what the court also considered important in determining
whether the defendants possessed the necessary minimum contacts: whether the
defendants, through their website, specifically targeted Nebraska. (The court said “no.”
Instead, the website was directed at the entire world.)
f. The Global Business Environment box at p. 33 deals with Daimler AG v. Bauman, a
2014 Supreme Court decision dealing with whether the U.S. District Court for the
Northern District of California could assert general in personam jurisdiction over a
German company. Discuss with the students the difference between specific in personam
jurisdiction and the general variety of in personam jurisdiction. (See the Court’s
explanation.) Ask why the Court concludes that the defendant corporation’s contacts
with the forum district were neither significant enough nor continuous enough to warrant
the exercise of general jurisdiction.
g. For further examples of long-arm statute-related issues and due process concerns, see
Problems #3, #7, and #10.
h. Explain the difference between in personam jurisdiction and in rem jurisdiction.
i. Although the text mentions it only in a footnote, you might want to discuss quasi-in-
rem or "attachment" jurisdiction, which (along with subject-matter jurisdiction) also
gives a court the power to decide a case. Here, the court bases its jurisdiction on the
location of property within the state, but issues a judgment affecting rights unrelated
to the property (unlike what occurs in cases involving in rem jurisdiction). In some
cases, the property in question may be intangible. One example of quasi in rem
jurisdiction is based on Harris v. Balk, 198 U.S. 215 (1904). Suppose Y owes X a
debt, but Y is outside the in personam jurisdiction of X's state. Suppose also that Z
owes Y a debt, and Z comes into X's state. X may get quasi in rem jurisdiction over Y
on the basis of Z's debt, which is considered to reside wherever the debtor (Z)
resides. This gives the court the power to determine Y's obligation to X--a matter
unrelated to the property on which jurisdiction is based. In such cases, however, the
most the plaintiff should be able to recover is the value of the property on which
jurisdiction is based.
j. Be sure to distinguish jurisdiction from venue. Emphasize that a court may have
2-3
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 02 - The Resolution of Private Disputes
jurisdiction even when proper venue is lacking. Also note that jurisdiction
presupposes venue in the sense that the latter is not an issue until the former exists or
is assumed to exist.
k. Note the role that contractual forum selection clauses may play in determining
matters of jurisdiction and venue. As the text indicates, “clickwrap” provisions of
this nature tend to be honored if their terms do not seem unreasonable, even though
genuine, informed consent to such provisions may often be lacking.
C. Federal Courts and their Jurisdiction
1. Briefly describe the various federal courts and their functions. Be sure to emphasize the
territorial organization of the district courts and the courts of appeals. See Figure 1,
which appears at p. 39. You may want to make only passing mention of the specialized
federal courts.
2. With regard to federal district court jurisdiction and venue:
a. Emphasize the elements necessary for diversity jurisdiction: (1) the case is between
citizens of different states (or is between a citizen of a state and either a citizen of a
foreign nation or the government of a foreign nation); and (2) the amount in
controversy exceeds $75,000. Note that for federal question jurisdiction, there is no
dollar test. Such jurisdiction exists as to any claim that “arises under” federal law.
b. Point out that the traditional reason for diversity jurisdiction was the possibility of
prejudice against out-of-state defendants in state courts. You might ask whether this
justification packs much weight today. Note, also, that Congress has increased the
requisite amount in controversy various times over the years, and that there have
been many defeated proposals to eliminate the district courts' diversity jurisdiction.
c. Note that the rule regarding a corporation’s citizenship may sometimes have the
effect of limiting a plaintiff’s ability to rely on diversity jurisdiction. The Hertz case
(discussed below in the section dealing with the power of removal) clarified what
constitutes a corporation’s principal place of business for purposes of the diversity
rule that a corporation is a citizen of the state in which it is incorporated and of the
state of its principal place of business.
d. Stress that diversity jurisdiction and federal question jurisdiction are forms of
subject-matter jurisdiction. In order to have the power to render a decision that is
binding on the parties, a federal court must have both subject-matter jurisdiction and
in personam jurisdiction. As noted above and in the chapter, the analysis of in
personam jurisdiction issues in the federal court system is essentially the same as in
the state court systems. Remind the students that federal courts may rely on state
long-arm statutes as a means of obtaining in personam jurisdiction over a defendant
who does not reside in the federal district where the litigation is being pursued.
e. Again, note the Global Business Environment box at p. 33. (See the earlier
discussion.)
f. Consider using a simple example to illustrate the options potentially available to a
plaintiff who wants to sue an out-of-state defendant. (You might use the chapter’s
introductory problem or something similar to it.) The plaintiff might: (1) try to
establish state court in personam jurisdiction over the defendant in the plaintiff's
home state (through a long-arm statute or otherwise); (2) try to establish federal
court in personam jurisdiction over the defendant in the plaintiff's home federal
district (through a long-arm statute or otherwise); (3) sue the defendant in a state
court in the defendant’s home state; or (4) sue the defendant in a federal court in the
defendant’s home district. (Options #2 and #4 would be available only if the amount
2-4
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 02 - The Resolution of Private Disputes
in controversy exceeds $75,000.)
g. Explain the power of removal that is available to a defendant when the case was filed
in state court but concurrent jurisdiction exists (i.e., the case could properly have
been filed in state court or in federal court). Assuming the defendant acts promptly,
the case can be removed to federal court.
h. Hertz Corp. v. Friend (p. 36): The U.S. Supreme Court holds that for purposes of
federal diversity jurisdiction, a corporation’s principal place of business is where its
“nerve center” is located. Applying the nerve center test to the facts, the Court
concludes that the plaintiff and the defendant were citizens of different states, that
federal jurisdiction would have existed (on the basis of that fact and the further fact
that more than $75,000 was in controversy), and that the defendant was therefore
entitled to have the case removed from state court (where the plaintiff filed it) to
federal court.
Points for Discussion: Begin by asking when the power of removal applies and about
strategic issues associated with deciding whether to exercise it when it does apply.
Then ask for an overview of the basic facts here. Ask what state or states in which a
corporation is considered to be a citizen for diversity jurisdiction purposes. (State of
incorporation and state of principal place of business.) What test for principal place
of business does the plaintiff ask the Court to apply? (What might be called a
greatest-volume-of-business test.) If the Court had adopted that test, what would
have happened here? (Hertz would have been considered a citizen of California
because it allegedly did more business there than in any other state. If Hertz were
considered a citizen of California—the same state of which the plaintiff was a citizen
—the diversity requirements would not have been met and Hertz would not have
been entitled to remove the case to federal court.) What principal-place-of-business
test does the Court adopt instead? (Nerve center test.) What’s the nerve center?
(Where the big corporate decision are made—usually the corporate headquarters.)
Why that test? (More reliable, more consistent and predictable, etc.) What’s the
effect of that test here? (Hertz is citizen of state where incorporated (state other than
California) and of New Jersey, where corporate headquarters located. Plaintiff is
California citizen. With more than $75,000 in controversy, diversity jurisdiction
requirements are met, concurrent jurisdiction exits, and Hertz can remove case to
federal court.)
i. The federal venue statute, whose details were omitted in the text, says that a diversity
case may be brought only in a judicial district where: (1) any defendant resides, if all
defendants reside in the same state; (2) a substantial part of the events giving rise to
the case occurred, or the property to which the case relates is located; or (3) the
defendants are subject to in personam jurisdiction, if there is no other district in
which suit may be brought. In other cases, the litigation may be brought only in a
district where: (1) any defendant resides, if all defendants reside in the same state; (2)
a substantial part of the events giving rise to the case occurred, or the property to
which the case relates is located; or (3) the defendant may be found, if there is no
other district in which suit may be brought.
j. Note that the federal courts generally apply state substantive law in cases in which
jurisdiction is based solely on diversity of citizenship. Sometimes, however,
determining which state's substantive law to apply is a problem, especially in cases
involving multistate transactions. The resulting choice-of-law issues are beyond the
scope of this text. You may want to do little more than note the existence of these
issues.
2-5
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 02 - The Resolution of Private Disputes
2-6
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 02 - The Resolution of Private Disputes
3. Note that the Supreme Court's mandatory "appeal" jurisdiction no longer exists, and that
most appeals coming to the Supreme Court now do so through its discretionary certiorari
jurisdiction. Thus, the Court continues to hear only a small percentage of the appeals
directed to it.
4. On the Supreme Court's original jurisdiction, see Problem #9.
D. Civil Procedure
1. In presenting civil procedure, it is probably best to proceed sequentially, as the text does.
Instructors with the time to do so might concoct a hypothetical civil action and use it to
illustrate each procedural step.
2. You should note that the adversary system is at work throughout the procedural steps to
be discussed. A few words on the pros and cons of the adversary system may be useful.
Briefly explain the operation and effect of the preponderance of the evidence standard.
3. Emphasize that jurisdiction and adequacy of service of process are separate questions.
Also, regarding service of process, you might note that the text's discussion is only
illustrative. For example, so-called constructive service--service by publication in some
communications medium--may still be permissible as a sort of “last resort” in certain
instances. One possible example is where a state court has in rem jurisdiction over
property in which an out-of-state party has an interest, and neither that party nor his
domicile can be located.
4. Discuss the pleadings and distinguish among the complaint, answer, counterclaim, and
reply. Note that there is no need for an answer if the defendant successfully moves to
dismiss the case. Be sure to note the possibility of an affirmative defense in the answer.
Throughout, stress the general movement away from technical pleading rules.
5. Emphasize that a demurrer attacks the legal sufficiency of the plaintiff's complaint and
assumes the truth of the factual allegations in the complaint for purposes of the motion.
The example in the text is intended to drive home the first point. Note also that if a
demurrer or other motion to dismiss fails, the defendant normally must answer the
complaint.
6. The text contains an extensive discussion of discovery. Comment on discovery’s
purposes, usefulness, and broad scope in civil cases. Note, also, that discovery is
available to each party to the case and that it generally occurs without judicial
involvement or oversight unless a problem develops. Explain these forms of discovery:
a. Depositions. Note how depositions are conducted and why an attorney would want
to take the deposition of an opposing party or a potential witness (to find out what
that person knows, to pin that person down to a particular story, to see what sort of
witness that person would be, etc.). Note, also, the ways in which depositions may
be used at trial and the circumstances under which use is allowed. See pp. 42-43 of
the text on this.
b. Interrogatories and requests for admission. Note their similarities and differences.
Explain the obligation to respond, under oath, within the appropriate time period.
Stress that a request for admission is deemed admitted if no response is made within
the allotted time. See Problem #8. Note how answers to interrogatories and requests
for admission may be used at trial.
2-7
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 02 - The Resolution of Private Disputes
c. Requests for production of documents and other physical items. Stress that when a
proper request is made, a party to litigation may have to produce--from its own files
and records--copies of documents and other items that it would prefer not to release.
Note that sometimes the most effective evidence presented by a party at trial may
consist of copies of documents that came from the opposing party’s files and records.
d. Motions for physical or mental exam (where relevant to the case). Note that unlike
the other main forms of discovery, this one requires a court order.
7. Although the discovery process normally is conducted without judicial involvement or
supervision, there are instances in which courts must become involved. If a party raises a
privilege objection or some other legally recognized objection to a discovery request, the
court must decide whether the objection has merit. Judicial involvement is also necessary
if a party does not comply with discovery obligations (e.g., doesn’t answer
interrogatories, doesn’t produce a requested document that is relevant, etc.).
8. The Cyberlaw in Action box at p. 42 deals with the relatively new federal rules governing
discovery of electronically stored information (ESI). Note what is covered by the ESI
definition. Work through the steps in the ESI discovery process, as outlined in the
Cyberlaw box. Note what the discoverability of ESI means for businesses’ retention and
preservation of potentially discoverable electronic information.
9. Remind your students of something noted earlier: that the discovery process sometimes
makes one’s own files and records the source of evidence that may be very helpful to the
opposing party. The temptation to destroy the potentially damaging material in one’s
files may lead to significant legal problems if the destruction occurs. This temptation
also raises serious ethical questions. The Ethics in Action box at p. 44 discusses such
legal and ethical issues, which have been given heightened media attention in the wake of
recent scandals involving corporate misconduct and accounting fraud.
10. Stress that summary judgment involves both law-identifying and fact-resolution
functions. Note why the summary judgment option is available in appropriate cases.
(Why go to the trouble and expense of a full-scale trial if the material facts aren’t in
dispute and the correct legal treatment of the facts is clear?)
11. With regard to the civil trial:
a. Note the purpose and role of the pre-trial conference and any order emerging from it.
b. You may want to go beyond the text by saying a few words about the issues
surrounding the availability of a jury trial. Briefly, a jury trial is available at the
demand of either party if certain tests are met. The federal and state constitutions set
minimum standards for the availability of a jury trial. For example, the Seventh
Amendment (which does not apply to the states) makes a jury trial available "in suits
at common law" exceeding $20, and most states have similar provisions in their
constitutions or statutes. The test for determining whether the case is "at common
law" is generally whether the claim was traditionally one classed as "at law," rather
than "in equity." The complex body of law devoted to this question cannot be
discussed in detail here, although it is accurate to say that a high percentage of cases
in which money damages would be the typical remedy are cases “at law” and thus
likely to be covered by a jury trial right. In addition, because the constitutional
standards merely state a minimum, Congress and the state legislatures have
authorized jury trials in other situations.
c. You might also want to say more about the process of jury selection---especially voir
dire, challenges for cause, and peremptory challenges. Challenges for cause are
unlimited in number but require the judge's approval. Peremptory challenges do not
2-8
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 02 - The Resolution of Private Disputes
require the judge’s approval but are limited in number. Of course, peremptory
challenges are generally used to eliminate potential jurors who, the attorney suspects,
may be likely to be unsympathetic toward his or her client but could not successfully
be challenged for cause.
d. Note the basic division of labor between judge and jury in jury trials.
e. With the above preliminaries out of the way, the stage is set for the text's summary of
the typical trial scenario. Work through the basics of trial procedure outlined in the
text. Note the differences between direct and cross-examination. Explain how
typical TV show and movie depictions of courtroom scenes usually don’t depict
direct and cross-examination accurately and show even less accuracy when they
depict the making of objections during trial. (On TV and in the movies, merely
saying “Objection!” seems to be enough. In the real world, a legal basis for the
objection must also be cited.)
f. Note the difference between lay witnesses and expert witnesses. Explain the standard
for whether a party may testify as an expert witness.
g. Following the basic trial scenario, discuss the different procedures followed in trials
before a judge and trials before a jury. Also, discuss the pros and cons of the general
verdict. This can lead those who are so inclined into a general discussion of the jury's
role in the American legal system.
h. Continuing the theme of the jury's role, discuss the motion for a directed verdict and
the motion for judgment notwithstanding the verdict. Stress that both are "jury-
policing" devices designed to take the case away from the jury in certain situations
(with the directed verdict doing so before the jury decides the case and the judgment
n.o.v. doing so after the jury’s decision). Mention the similarities between the two
motions--especially the stern nature of the test applicable to each and the reality that
such motions are denied most of the time. You might add that in many jurisdictions,
the motion for a directed verdict is a necessary prerequisite to a motion for judgment
n.o.v. On these two motions, see Problem #6.
i. Regarding the motion for a new trial, see Problem #6.
13. When discussing the appeal of civil judgments, re-emphasize that appellate courts are
limited to the resolution of "legal" issues. Supplement the examples at p. 46 with
additional examples of legal issues. Ask about Problem #1. Note the options available to
appellate courts: affirm (in whole or in part); reverse (in whole or in part); and reverse
and remand.
14. Regarding the text's discussion of enforcement of a judgment, emphasize the bearing
effective enforcement has on the decision to sue a particular party in the first place.
15. Explain the nature of class actions, the rationale for allowing them in appropriate
instances, and the usual standards that must be met in order for a court to certify a case as
a class action. On the latter point, emphasize that a case cannot proceed as a class action
unless a court has approved its going forward in that form. Discuss the 2005 statute
enacted by Congress in an effort to restrict the number of class actions in state courts and
to require that many class actions, if they are to be litigated at all, must be pursued in
federal court. Also, discuss the views among some that the 2005 statute did not go far
enough and that some proposed classes are simply “too big.” Then note the opposing
concerns that may arise if courts become less inclined to certify cases as class actions.
16. Wal-Mart Stores, Inc. v. Dukes (p. 47): The Supreme Court holds that class action
certification should not have been granted with regard to a lawsuit in which a supposed
class of 1.5 million women alleged that Wal-Mart committed sex discrimination in
2-9
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 02 - The Resolution of Private Disputes
deciding on promotions and salary increases.
Points for Discussion: Note that this decision almost certainly will be very influential
as lower courts decide on whether to certify a case as a class action. The decision may in
some instances make it harder for plaintiffs to convince courts to certify cases as class
actions. Ask the students why the Court said class action certification should not have
been granted. Note the Court’s emphasis on the varying nature and specifics of the
female employees’ claims, even though they all dealt with sex discrimination in some
sense. The claims, therefore, were not sufficiently common in their facts and in the
issues they presented. Simply put, the employees’ claims were not similar enough to
warrant treatment in a single legal action. Was the Court influenced by “too big”
concerns of the sort noted above? Perhaps such a thought crossed the mind of some of
the justices, but the differences among the various claims provided the Court with a
reasonable basis on which to hold that the case could not proceed as a class action. Note,
of course, that the individual plaintiffs could still bring their own cases, but it seems
doubtful that all 1.5 million persons would file separate lawsuits,
E. With regard to ADR:
1. Emphasize the main reasons for the growing popularity of ADR: the "litigation
explosion;" the demands this has placed on the courts and the social costs these demands
have generated; and the cumbersomeness, expense, and aggravation associated with using
normal judicial procedures for resolving disputes. Also note the possible costs of ADR
mentioned in the text
2. Explain the major forms of ADR. You may wish to focus most of your attention on
arbitration and mediation, being sure to clarify the ways in which they are different.
3. The text indicates that arbitrators sometimes may have freedom to ignore substantive
rules of law that would apply in court. Stress, however, that most of the time, the
substantive rules of law that apply in court also apply in arbitration proceedings.
4. Additional example of situations in which "private" mediation may be used: school
disputes. Court-annexed mediation sometimes tends to be associated with small claims,
housing, and family courts.
5. AT&T Mobility LLC v. Concepcion (p. 51): The U.S. Supreme Court holds that if an
arbitration clause in a contract not only requires that disputes be arbitrated but also bars
class-wide arbitration, the clause is valid and enforceable under the Federal Arbitration
Act.
Points for Discussion: Ask students about the basic facts here and about why the
plaintiffs who filed suit would have wanted this case to proceed in court as a class action,
as opposed to having to go through arbitration on an individual-claims basis. (Because
the damages for them individually and for other individual consumers would be
miniscule in amount—meaning that the vast majority of consumers probably wouldn’t
bother to proceed with a complaint.) Ask why the plaintiffs thought they could proceed
in court despite the arbitration provision. (Because California cases had established that
arbitration clauses prohibiting class arbitration were unenforceable on the ground of
unconscionability, and because the Federal Arbitration Act’s general command that
arbitration clauses must be enforced was subject to an exception for state law-based
grounds for attacking the validity of a contract.) Work through the Supreme Court’s
reasoning in support of the conclusion that the FAA’s general command controls here and
that the exception for state law-based grounds doesn’t apply. The effect, of course, is that
arbitration clauses are enforceable even if they bar class-wide aggregation of claims.
What do your students think about the Court’s reasoning? What do they think will
happen as a result of this decision? (Almost certainly, companies will respond to the
2-10
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 02 - The Resolution of Private Disputes
decision by adding prohibitions on classwide aggregation of claims to the arbitration
clauses they put into their contracts. Class arbitration is very likely to become a seldom-
encountered breed.) Note the objections raised by Justice Breyer in the brief excerpt
from his dissent.
6. For additional examples of arbitration and FAA issues, see Problems #2 and #5.
IV. RECOMMENDED REFERENCES:
A. G. HAZARD & M. TARUFFO, AMERICAN CIVIL PROCEDURE: AN INTRODUCTION.
B. M. KANE, CIVIL PROCEDURE IN A NUTSHELL.
C. J. NOLAN-HALEY, ALTERNATIVE DISPUTE RESOLUTION IN A NUTSHELL.
2-11
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
