LEGAL ENV OF BUS
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Chapter 9 Intellectual Property Trademark a design logo phrase distinctive mark name or word 0 Protected by the Lanham Act 0 Classifications o Arbitrary and fanciful o Suggestive 0 Descriptive 0 Generic 0 Registration 0 Can be done online 0 You must submit a copy of the mark specimen description of the good that will use the mark and declaration that the applicant has no knowledge that the mark will conflict with other marks 0 Good for 10 yrs Infringement Dilution and Cybersquatting o Infringement o A seller sells a shoe he designed under the brand name Rebok the buyer will be confused thinking the shoe is a genuine Reebok shoe Essentially the maker is stealing the good name of another The Lanham Act specifically allows suite for infringement o Dilution o Trademark Dilution Act of 1995 further strengthened by the Trademark Revision Dilution Act of 2006 injunction can be issued against those who blur or tarnish famous trademarks 0 Le A company sells guitars under the name Reebok Although no one would think the guitars to be Reebok athletic wear they may presume Reebok has gotten into other product lines thereby diluting the strength of the mark 0 Cybersquatting o Improper use ofa trademark in a domain name to capture value from another s trademark o Enforced by the Anticybersquatting Consumer Protection Act 0 Le using the domain wwwreebokshoescom without permission from Reebok o Defenses 0 Fair use mention of mark in comparative advertising 0 Noncommercial use parody or editorial commentary 0 News reporting or educational use Audi AG v D Amato o D Amato registered domain name wwwaudisportcom 0 Sold goodsservices with Audi logos 0 Site used various Audi Trademarks Audi Quattro amp Audi Four Ring Logo 0 D Amato claimed to have permission from an Audi Dealership salesman even if he did Audi dealerships don t have rights to grant use of trademarks 0 Audi sues D Amato for infringement dilution and cybersquatting of its 3 trademarks 0 District Court Held for Audi Issued a permanent injunction against D Amato o D Amato appealed o Held Affirmed D Amato did infringe 0 There was a llLikelihood of confusionquot o D Amato s disclaimer on his website of association with Audi does not absolve him from liability 0 He misdirected consumers to his website and created an llinitial interest confusionquot Lanham Act 0 The website commercially had an effect that damaged Audi 0 Dilution Iaw integrity and distinctiveness of mark was infringed upon 0 Under the Anticibersquatting Consumer Protection Act ACPA requirements have been met showing D Amato was in bad faith to profit from Audi s marks Counterfeiting Copying or imitating of a mark without the authority to do so 0 Passing off goods as if they were original 0 Problem faced by well known companies universities professional sports Nike and Disney 0 These products don t only damage the company s profits but the usually lower quality product may damage the company s reputation 0 Even if the consumer is told that it is counterfeit the trademark has still been counterfeited o Lanham Act allows private parties to obtain searchandseizure orders to grab counterfeit goods 0 Private investigators look for imitations provide US Attorney with evidence and US Attorney either takes action or approves a party s right to obtain a warrant before a judge o Counterfeit goods can be used as evidence in lawsuits Trade Dress 0 Protected by Lanham Act 0 Concerns to the lllook and feel of products and service establishments 0 Size shape color texture graphics etc 0 Must be llinherently distinctive 0 Two Pesos v Taco Cabana o Prevented one Mexican restaurant from copying its competitor s d cor o Wal Mart Stores v Samara Brothers 0 No infringement by WalMart on Samara s design of children s clothing 0 Secondary Meaning primary significance of mark or trade dress is to ID the source of the product rather than the product itself The product must be identifiable by consumers TO THE SOURCE Other Marks 0 Service Marks 0 Apply to services not goods 0 Law is the same as for trademarks 0 Le Burger King s llHome of the Whopper 0 Certification Mark 0 Word symbol or device used to certify regional or geographical orgin 0 Le Made in Montana 0 May also be type of material used mode of manufacture or other characteristic 0 Le Union Made in the USA Trade Names 0 Name of a company or business 0 Cannot be registered under the Lanham Act 0 Protected by common law 0 National protection cannot be claimed unless there might be confusion 0 Ex because CocaCola is known worldwide no one may use the trade name in business Goodwill The reputation ofa firm that gives value to trademarks o Damages may be assigned to loss of profit due to damage of a company s goodwill Copyright 0 Rights of literary property recognized by law 0 Books written works etc o Easiest to get 0 Work must be original 0 Was life of the author plus 50 years now since 1999 is life of author plus 70 years 0 Gives the owner exclusive right to o Reproduce Publish or distribute Displayperform in public 000 Prepare derivative works based on original Infringement and Fair Use in Copyright 0 Fair use llfor purposes such as criticism comment news reporting teaching scholarship or research 0 Four Factors of llfair use 0 Purpose of character of copying 0 Nature of work 0 Extent of copying 0 Effect of copying on market 0 File sharing on the Internet Napster was shut down for supporting copyright infringements 0 New York Times v Tasini o Tasini and other authors wrote articles for the NY Times Co Authors registered copyrights in articles 0 Times allowed LEXISNEXIS to publish works online 0 Authors sued Times for copyright infringement as the authors did not give permission for online publication Times said it had the right to reproduce the works 0 SUPREME COURT HELD both Times and LEXISNEXIS infringed o LEXIS infringed in publishing without permission Times infringed by authorizing and aiding LEXIS in placing articles in the LEXIS database 0 Metro Goldwyn Mayer Studios MGM v Grokster Ltd o Grokster provided software that allows computer users to share videomusic files on peertopeer networks 0 Users shared files including those owned by MGM o MGM sued for copyright infringement saying Grokster knowingly and intentionally distributed software to enable users to infringe Grokster made it possible for others to violate copyright laws 0 District court of appeals granted summary judgment in favor of Grokster said that distributing software did not make Grokster liable for infringement done by others using software 0 MGM Appealed o HELD summary judgment and appellate court decisions were vacated On remand trial court will reconsider MGM s motion for summary judgment 0 One infringes contributorin by encouraging infringement and vicariously by profiting from direct infringement Grokster sold the software for S o Grokster provided customers with technical support to induce the infringement inducement rule Acts were purposeful Pa tents Exclusive right to make use or sell a product for 20 yrs Anyone who quotinvents or discovers a new useful process machine manufacture or composition of matter or any new and useful improvement thereof may obtain a patentquot Strong protection during the life of the patent but patent s divulge all info to competitors so some prefer trade secrets If Coke had gotten a patent its product could have been made by others after 1907 Nystrom v Trex Company Inc 0 Nystrom received a patent for quotA board used for construction deckingmanufactured to a have a convex top surface which sheds water and at the same time is comfortable to walk onquot Nystrom sues Trex a larger mfgr Of decking planks made from composites for O infringing Trex s defense is that their planks do not come from logs which is what board suggests District Court Summary judgment in favor of Trex Nystrom appeals US Ct of Appeals summary judgment is reversed 0000 Opinion centered on the meaning of the work quotboardquot Nystrom says that quotboardquot is not limited to wood cut from a log quotboardquot can encompass many rigid materials Trex infringed on making the quotboardquot in a convex top surface 0 International Perspective regarding Patents WIPO World Intellectual Property Organization encourages Intellectual protection around the world In Europe patents cannot be obtained for surgery or therapy methods or for new plantsanimal varieties Europe is more patent restrictive on software than the United States In US inventor may disclose invention up to one year prior to filing a patent no such disclosure in Europe o Coowners of patents in the US can exploit patent right in Japan all coowners must agree on how it is exploited o In Japan employees who create patentable inventions on the job must receive compensation This is unlike the US and Europe Trade Secrets CocaCola has held secret the formula for Coke for over 100 yrs A patent would not provide such lengthy protection 0 Most trade secret lawsuits are common law actions of stealing and using secrets 0 Prosecutors can press criminal charges 0 Information is a trade secret if o It is not known by the competition 0 The business would lose advantage if competition were to obtain it 0 Owner has taken reasonable steps to protect the secret from disclosure 0 Hicklin Engineering LC v R Bartell o Bartell worked for Hicklin for 7 yrs as an independent contractor He designed and made testing equipment for vehicle transmissions Bartell quit and formed a competing business Hicklin sued Bartell for violation of Trade secret Judge held for Bartell Hicklin Appealed HELD Judgment vacated and case remanded OOOOO Determine what data was Hicklin s trade secret if Bartell knew info was confidential Economic Espionage Usually trade secrets are based on common law and enforced by litigation claiming misappropriation 0 Economic Espionage Act of 1996 llwhoever with intent to convert a trade secret that is related to or included in a product that is produced for or placed in interstate or foreign commerce to the economic benefit of anyone other than the owner thereof and intending or knowing that the offense will injure any owner of that trade secret is subject to prosecution 0 Makes it a federal criminal offense to steal a trade secret and give it or sell it to another in commerce for economic benefit 0 Punishment for a person can be up to 10 years in prison 0 Firms may face fines up to 5 million Chapter 10 Contracts Definition of a Contract 0 Modern definition centers on a promise quotA promise or set of promises for the breach of which the law gives a remedy or the performance of which the law in some way recognizes a dutyquot 0 Contracts form legal relationships and duties between parties Concepts of Contract Law 0 Common Law 0 Judgemade law 0 Each state differs 0 There is uniformity about general contract principles that run throughout most state s laws 0 UCC 0 Uniform Commercial Code 0 All states have adopted except Louisiana 0 Covers contracts for sale of goods Express and Implied Contracts 0 Express contracts 0 Direct statement by the parties of the promise made 0 May be oral or written 0 All important terms are expressly stated between parties 0 Implied Contract Actions and circumstances infer and define the terms of the contract 0 0 May be words conduct gestures 0 These contracts are implied at law 0 Ex At the checkout counter at a grocery store actions of the parties create offersacceptance Elements of a Contract An agreement Offer and Acceptance Consideration Contractual capacity Legality Genuine consent PWPP N Writing if necessary under the Statute of Frauds If all elements are present the contract is generally termed valid Element 1 The AgreementThe Offer 0 The Offer 0 Creates the Offeror and Offeree o Manifestation of intent I Preliminary negotiations vs Intent to Offer preliminary negotiations are not offers but are invitations to negotiate or to make an offer 0 Definite I Not every tiny detail must be present for it to be a valid offer I Ex If you order a computer by mail the contract does not have to say that the computer will be properly packed for shipment that is presumed 0 Communication I Acceptance requires knowledge of the offer Terminating an Offer Revocation withdrawing of offer by the Offeror before it is accepted 0 Rejection o By Oferee 0 Through lapse of time depends on the subject 0 Counteroffers are created by rejecting the original offer but keeping negotiations open by presenting new conditions I Ex Johnny offers to buy Brad s laptop for 500 Brad says he will sell it for 600 a counteroffer has been made The original offer by Johnny is terminated by the counteroffer That is by making a counteroffer Brad became the offeror and Johnny became the offeree 0 Operation of Law 0 Illegal subject matter 0 Destruction of subject matter 0 Death or insanity of one of the parties Element 1 The Agreement The Acceptance o The Acceptance o The offeree s expression ofassent or agreement to the terms of an offer 0 For an offer to be accepted it must be I Unconditional must be a mirror image of the offer if conditions are added they create a counteroffer I Unequivocal the answer to the offer must be very clear not quotI seequot I Legally Communicated Parker v Glosson Douglas and Sandy Glosson offered to sell their land warehouse truck shop and office Douglas Glosson and Parker agreed on the terms 0 Two men signed the agreement Sandy Glosson didn t sign deal fell through Parker sued for breach of k requesting specific performance for damages Trial court dismissed suit Parker appealed HELD Affirmed Contract must have mutual assent and meeting of the minds to be enforceable Sandy didn t sign agreement was not fully executed no contract Bilateral amp Unilateral Contracts Bilateral Contracts 0 2 promises o A promise in exchange for a promise 0 Ex I promise to pay you 25 to mow my lawn if you promise to mow my lawn o If promises are broken there may be responsibility if losses are incurred o Unilateral Contract 0 Only 1 promise o A promise in exchange for a performance 0 Ex I promise to pay you 25 to mow my lawn you go out and mow it 0 Once performance has been made the other party s duty arises to fulfill hisher promise Element 2 Consideration 0 Definition Something of value or something bargained for in exchange for a promise o This element keeps contracts from being a gift Adequacy of Consideration o Courts don t care if a party bargains poorly and will usually not interfere 0 Those who bargain take on the risk of their own errors 0 The main concern is an exchange of mutual promises and obligation by the parties Caley v Gulfstream Aerospace Corp Gulfstream adopted a dispute resolution policy DRP policy is only procedure to resolve disputes between Gulfstream and employees They mailed it to employees and said DRP would begin in 2 weeks and would be lla condition of continued employment Group of employees sued saying there was no contract and DRP could not be enforced District court Held for Gulfstream Employees appealed HELD Affirmed DRP is an offer and states it is a contract Terms of acceptance are continued employment by employees Here the act of continuing employment acceptance of the contract Employees had a choice 1 continue employment accepting DPR or 2 terminate employment Enforceable Promises without Consideration Promissory Estoppel Use of this doctrine avoids injustice due to the promisee s reasonable reliance on the promisor s promise Promisor is stopped prevented from denying a promise Equitable Doctrine o A promise which the promisor should reasonably expect to induce action or forbearance on the part of the promissee and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise Hinson v NampW Construction Company Inc NampW Construction Company submits a bid to Mississippi Job Corps Center to build a kitchen NampW receives an oral bid of 92k from Hinson plumbing When NampW was awarded the bid they notified Hinson to begin work He refused to return plumbing contract and start work NampW then used the next lowest plumbing sub which was 139k 47k more that Hinson NampW sued Hinson for 47k based on promissory estoppels Trial Court granted summary judgment for NampW awarding 47k Hinson Appealed Ct of Appeals HELD Affirmed Henson admitted to a verbal quote o Promissory estoppels arises when llmaking a promise even through without consideration the plaintiff NampW relied upon Element 3 Capacity 0 Refers to the legal ability to create a contract 0 Some have limited capacity to contract 0 Minors o Intoxicated persons 0 Insane persons 0 If there is no capacity the contract is void 0 If there is partial capacity the contract is voidable may disaffirm Void and Voidable Contracts 0 Void 0 contract does not exist at law 0 One element is missing lacks requirement of a contract 0 Le contract with a legally insane person 0 Le contract for an illegal subject matter 0 courts won t accept disputes o Voidable 0 One party to the contract has right to avoid legal obligation o Is valid but capable of being voided by circumstances I Minors contracts I Contracts with persons under the influence of drugsalcohol I Fraud by one of the parties Minors 0 Originally 21 now 18 0 Contract is voidable 0 Legal policy to protect the young from the llresults of their own follyquot o If a minor disaffirms a contract after receiving benefits restitution must be paid for the benefit 0 A 16 buys a car on credit and drives for 6 months restitution must be paid for the value of the benefit received 0 There are some contracts that minors may not disaffirm enlistment marriage educational loans medical care 0 After reaching majority age the minor may ratify the contract Element 4 Legality 0 Subject matter must be lawful 0 Sale of drugs criminal activity gambling activities 0 Usury charging above the maximum for interest rates on loans Unenforceable Contracts 0 Contract is actually valid when made but change in law makes them unenforceable 0 Ex Company agrees to ship wheat to Iran After shipment is at sea the US government declares no US firms may trade with Iran 0 Results unenforceable under US Law even if seen as legal in Iran Legality amp Contracts Contrary to Public Policy Exculpatory Agreements Contracts written to escape liability o Unconscionable Agreements Outcome is grossly unfair to an innocent party The stronger party convinces the other party to enter into a contract contrary to his wellbeing 0 Contracts in Restraint of Trade 0 Contracts that restrain trade or unreasonably restricted competition 0 Covenant not to compete may be restraint of trade unless I Limited by time or territory I Different states differ on this subject DCS Sanitation Management Inc v Castillo DCS has many customers in several states including Nebraska 0 with DCS stating that following termination for any reason employees will not work for any personcompany that is in o DCS made r39 sign competition with DCS within a 100 mile radius of any DCS s customers 0 DCS lost a contract with Tyson in Nebraska and a competitor hired some former DCS employees 0 DCS sued employees Castillo for breach of k 0 District court held for Castillo DCS appealed o HELD affirmed o The Nebraska court will not reform an agreement to make it enforceable o DCS s g was and z I I o The agreements effectively put former employees out of cleaning business within the extensive region Element 5 Reality of ConsentGenuine Consent o This concept deals with an individual s choice of entering into agreements o If reality is missing there is no meeting of the minds 0 If there is unilateral mistake over a simple error then contract usually can be avoided ie typographical error 20000 instead of 200000 0 A person who quotagreesquot to a contract due to fraud misrepresentation duress or undue influence has the right to disaffirm the contract because there was not genuine consent LampL Doc s LLC v Florida Division of Alcoholic Beverages and Tobacco Leuders and Latte formed LampL and bought Doc s Saloon from Carlbob Inc for 125k o Doc s had a slot machine and soon the police arrested Latte for engaging in illegal gambling o LampL defaulted on paying the 125k so Carlbob owned by Dressel sued o LampL claimed Dressel engaged in fraud by representing slots were a good source of income 0 Trial court gave summary judgment to DresselCarlbob LampL appealed o HELD Affirmed LampL lose o In this case even if there was fraud LampL llknew or should have knownquot the gambling activities were illegal o Ignorance to the law is no excuse Element 6 The Statue of Frauds 1677 Sometimes needed 0 For certain contracts to be enforceable they must be in writing 0 Some contracts required in writing 0 Sale of land or interests therein Contracts that cannot be performed within 1 year Promise to pay the debt of another including debts of an estate 000 Promises made in consideration of marriage Sufficiency of writing 0 Writing must set out the material terms of contract 0 Names of parties Consideration Subject matter Pa role Evidence Rule Restricts use of oral evidence when that evidence is contrary to terms to written contract Oral evidence cannot contradict change or add terms to a written contract IF a written contract is incomplete ambiguous proves fraud mistake or misrepresentation THEN 0 Oral evidence may explain the problems Contracting with the Japanese US contracts tent to try to cover all contingencies Japanese view contracts as secondary to the ongoing relationships of the parties Contracts with the Japanese should be brief and flexible not detailed Long detailed contracts may be viewed with suspicion Strong statements will be viewed as an insult Japanese want llgood faith clauses in contracts with westerners Economic Loss Rule n Breach of K cases if there is no tort involved damages are only those related to economic losses suffered by the breach Rule Based on 3 policies 0 1 Maintain fundamental distinction between tort and contract law 0 2 protect commercial parties freedom to allocate risks by contract 0 3 encourage the party best situated to assess the risk of economic loss Damages are only those related to lost profits and costs due to the breach Accounting evidence and specific calculations are necessary evidence to be presented No punitive damages or mental distress awards parties often try to assert a tort along with a breach of k to get these damages llMe Read the Rulesquot Man bought 52 lottery tickets with the same numbers and won 52 times The ticket stated that the top prize was 100k and the maximum anyone could receive is 1million When he didn t receive 5 million he sued the convenience store for fraud claiming that the clerk did not tell him the terms but they were printed on the ticket Jury awarded him 250k and 11 million in punitive damages Appeals court threw out the judgment Quasi Contract quantum meruit Courts apply this classification in equity out of a sense of fairness to give relief to innocent parties Ex You watch as a crew in good faith comes to your house to pave a new driveway When they are done you must pay them for their services because you made no effort to stop them THE COURT SYSTEMS Chapter 2 gtgt Chapter Issues Overview of the American court system How an injured party can seek relief in the courts Jurisdiction Which court has the power and the authority to decide the case Relations between court systems Organization of the Court Systems 417v 3 Both state and federal court systems have Lower courts Courts of Original Jurisdiction Where disputes are initially brought and tried Generally known as trial courts Look at issues of fact Appellate Courts Courts of Appellate Jurisdiction Where lower court decisions are reviewed Look at issues of law State Jdges Judges chosen by variety of methods Unlike federal court most state judges serve fixed terms Evidence indicates that with elected judges the average in tort cases are larger and outof state companies are treated more poorly than in states with appointed judges Federal and State Judges Federal Judges Federal judges are nominated by the President Confirmed by a majority vote in US Senate Lifetime appointment May be removed from office only if Congress impeaches them intricate impeachment process and rarely happens Job security guarantees that judges are independent and free from political pressure Judicial Immunity A judge is absolutely Immune from suit for damages for judicial acts taken within hisher jurisdiction Applies even if action is excessivemalicious Purpose Judges are not concerned with the relative power of parties who appear in court Purpose To protect the system from undue influence on judicial decisionmaking See Davis v West Davis v West hr Houston Reporting Service HRS provided court reporting services for attorney Davis HRS billed Davis was never paid Sued for 108398 deposition attorney s fees interest costs Davis did not defend judge entered a DEFAULT JUDGMENT HRS began collection efforts Court appointed Radoff as receiver in the case Court order commanded Radoff to take possession of all monies in deposit by Davis in financial institutions Radoff sent letter to HRS attorney asking for payment Radoff sent letter to Davis s bank demanding that the bank turn over 414491 to Radoff Bank did Judgment satisfied HRS was paid receivership closed Davis sued Radoff for abuse of process Trial court granted summary judgment for Radoff as he was entitled to DERIVEDJUDICIAL IMMUNITY Davis appealed If A n nl lAAquot Davis V West cont HeIEI Affirmed Radoff is cloaked with DERIVEDJUDIC IAL IMMUNITY DERIVED JUDICIAL IMMUNITYby a person is the same as absolute immunity forjudges Judicial immunity can attach to certain nonjudges when judges delegate their authority appointing another to perform services for the court as an officer of the court Texas uses the functional approach looks whether the person seeking immunity is intimately associated with the judicial process Also that person exercises discretionary judgment comparable to that of the judge Functional approach focuses on nature of the function performed amp if person s conduct is like the delegating judge Radoff is cloaked with DERIVED JUDICIAL IMMUNITYquot Every action whether good or bad honest or dishonest well intentioned or not is immune as applied to the function undertaken The Federal Court System Federal District Court Courts of original jurisdiction Use juries or judge as trier of fact Trial courts deal in issues of fact Federal trial courts also usejudicial officers called magistrates 94 federal districts in the court system US Court of Appeals 12 courts Usual rule There is the Lig to appeal to this court 3 judge panels deal in issues of law and review most decisions En banc proceeding means all active judges in a circuit will a hear a case Specialized Federal Courts Limited jurisdiction le Court of Appeals for the Federal Circuittakes appeals from US District Court in patent trademark and copyright cases US Court of Federal Claims US Court of International Trade US Tax Court See Exhibit 22 The US Supreme Court Highest court in the country Appellate review court Cases usually heard by 9 justices Term begins First Monday in October in Washington DC Reviews cases from US District Courts very rare to come from here US Courts of Appeals Highest Courts of the States Review is through Writ of Certiorari Often deal with Constitutional decisions If writ not granted lower court decision is final The French Court System International Perspective France is a civil law country typical of Europe Written code law used rather than judgemade law Court System Cour de cessation Supreme Court Cour d appel Court of Appeals Tribunal d instance Court of general jurisdiction Appellate process in France is very different from US Cour de Cessation no authority to create judgments Cour de Cessation rejects an appeal or invalidates the decision amp returns case to Cour d appel for reconsideration The Typical State Court System ute court of Oriqinal Jurisdiction Where case is first brought deals in issues of fact Usually called District Court But in NY is called the Supreme Court ute court of Appellate Jurisdiction Deals with appeals and issues of law Usually called Court of Appeals Can have different names District Court of Appeals in FL Appellate Division in NY mte Supreme Court Second appellate review dealing w issues of law Usually called Supreme Court but in NY is called Court of Appeals lntheCourtroom Training Not uncommon for people to represent themselves PRO SE Failure rate is pretty high when this happens Sometimes judges are sympathetic Sometimes they aren t Paul Baldwin appeared in court Portsmouth NH Arrested for stealing beer Judge asked if he wanted a lawyer Baldwin replied I don t need a lawyer I ve been in the court more than you have Might have been true 152 previous arrests Judge was not amused set bail at 10000 Rules of Civil Procedure In United States Code Title 28 Federal Rules of Civil Procedure Govern procedural aspects of litigation Pleadings Discovery Trial procedures Relevant motions States are free to develop their own procedural rules Most adopt the Federal Rules of Civil Procedure or rules very similar to them See Test Yourself p 36 Jurisprudence Being A Judge Makes Me Sick urphy claimed that illnesses included phobia of sitting in judgment To help heal himself while being paid 130000year as judge he also enrolled full time in a medical school in the Caribbean California judicial board factfinding panel held LA Judge Patrick Murphy not entitled to 400 days of paid sick leave that he claimed 5 Subject Matter Jurisdiction Federal Courts Federal court jurisdiction is derived from the US Constitution Federal courts may hear cases involving federal questions Cases in which the US is a party to the suit Cases involving citizens of different states 39 Diversity of citizenship jurisdiction Amount in Controversy is for more than 75000 actual damages No amount for cases involving federal law London s Commercial Cou In international contracts parties can state how future disputes will be resolved either in the contract or when disputes arise The Commercial Court in London is a popular forum Trials handled by onejudge No jury Trials usually occur within 1 year of dispute Finished rather quickly Loser pays winner s attorney s fees English courts are respected judgment more likely to be enforced in other countries Remedies have been innovative amp relevant to commercial matters JURISDICTION Right of a court to hear and decide the case A number of courts may have jurisdiction over a given case Need jurisdiction over the subject matter Need jurisdiction over either persons or property if not suing just want what is what they believe is rightfully theirs lfjurisdiction is lacking judgment is null and void 39 44 ti 2 Subject Matter Jurisdiction State Courts Au particular court resolves a particular subject matter ie Wills amp Trusts Probate Court Divorces Child Custody FamilyDomestic Court Municipal Matters Municipal Court Small Claims Court Limited claims of usually 5000 or less sometimes up to 7500 will be heard If there is not a particular subject matter case first goes to general trial court Courts of original jurisdiction where case is first brought Courts of appellate jurisdiction where lower court decisions are reviewed If there is no jug judge decides the facts General right to appeal to at least one higher court Personal Jurisdiction IN PERSONAM JURISDICTION Over the person Out of state defendants usually through Jurisdiction is more Summons through difficult serVice OfP OCess 0r Serve them while in substituted service the state RGSidenCY May not trick them Doing business in to get into the state the state for service of Submission to the Process jurisdiction 7 See The Long Arm of the See Exhibit 24 Law Jurisdiction Over OutofState Business Defendants Longarm Statutes Aimed at nonresident businesses Protects states citizens from business defendants who do business in the state and then leave the state See Exhibit 25 re LongArm Statute Cyberlaw The Long Arm of the Internet When does a web site advertiser in nationwide sales become subject to another state s jurisdiction Generally personal jurisdiction occurs when defendant is engaged in business in a state ie Amazoncom does active business in every state by selling online and is subject jurisdiction in those states No jurisdiction if contact with a forum is only informationalquot even if the web site is interactive No jurisdiction if web site gives information about sales allows customers to download forms and provides email address for inquiries Unclear area How much sales activity must occur with residents in a state for the web seller to become subject to jurisdiction in the buyer s state Ex One low cost item is not active business esp if buyer initiates the contact Ex One spam email sent out of state no jurisdiction Territorial Jurisdiction Minimum Contacts Sale office transacting business within the state Landmark case International Shoe g4mfany v Washington Supreme Court 5 Legal contact legal nexus Examples of minimum contacts within a state Sales representatives Selling product Advertising Placing product in specific markets See Blimka v My Web Wholesaler LLC See Can Your Firm Be Reached Blimka v My Web Wholesaler LLC My Web Wholesalers of Maine does business on the Internet Blimka of Idaho surfed the net found My Web and called DePalma a My Web manager Ordered 26500 pairs ofjeans for 20935 and wired money Shipment of 16000 jeans arrived Blimka called My Web to complain about quality Blimka sued for fraud against My Web and DePalma in Idaho court Process was served on defendants in Maine No response by defendants court issued a judgment against both defendants saying it had jurisdiction They appealed HELD Affirmed Idaho court has jurisdiction Defendants actions of fraud invoked the use of the Idaho long arm statute Defendants purposeful false misrepresentation directed into Idaho created minimum contacts with Idaho that does not offend 14th Amendment traditional notions of fair play and substantial justice Blimka awarded attorney fees and costs Issue Spotter Can Your Firm Be Reached You work for Florida real estate development firm called Golden Shores Many clients are people coming to Florida from New York to retire To increase marketing emails are sent to potential clients offering 5 discount to buyers who respond by email and buy property New York requires real estate agents who offer property for sale to be registered in the state of New York A colleague in the firm says this law doesn t apply to your company because Golden Shores is located in Florida the only communication with New York is through email Colleague says that New York authorities cannot come after Golden Shores for any violations IS THE COLLEAGUE CORRECT Jurisdiction Over Property IN REM JURISDICTION In rem rem means the thing The dispute between the parties is over property Where property is located createsjurisdiction Whether the defendantproperty owner is within the jurisdiction does not matter Tangible property creates in remjurisdiction ie real estate personal property Intangible property creates in rem Le bank accounts stocks If property is removed to another state no in rem jurisdiction Exclusive Jurisdiction Federal courts have excluswe jurlsdlctlon over some matters Examples Federal crimes Bankruptcy Patents Copyrights Federal questions Congress can specify by statute exclusive jurisdiction in federal courts Over certain cases In other disputes jurisdiction may be either in federal or state court systems State courts have exclusive jurisdiction over some matters Examples Divorce Adoption Matters controlled by state government Supremacy of federal law state jurisdiction cannot infringe on federal jurisdiction Concurrent Jurisdiction a Federal and state courts have exclusive jurisdiction over some matters HOWEVER Sometimes both state amp federal courts have concurrent jurisdiction Plaintiff may bring suit in either court system f plaintiff chooses state court defendant has right to remove to federal court right of removal in diversity of citizenship cases If plaintiff files suit in defendant s home state court defendant cannot move case to federal court Sometimes Congress will explicitly give federal courts exclusive jurisdiction over an area of law Applying Appropriate Law in Federal Court Issue When there is diversity of citizenship which substantive law should the federal court apply Ex Smith amp Jones have contract dispute Smith is from Arizona Jones from California Which law applies See Erie v Tompkins Erie RR Co v Tompkins 1938 Which Law Applies A dark night Protruding object from train owned by Erie RR Company Tompkins injured as he stood next to the tracks in Pennsylvania He claimed accident caused by negligent operation of train 3 397 quot Tompkins Pennsylvania citizen Erie Incorporated in NY Accident In Pennsylvania lf federal common law applies Erie is liable lf Pennsylvania common law Tompkins trespassed amp Erie is not liable Trial court applied federal common law Jury awarded 30000 to Tompkins Affirmed by the Court of Appeals Erie appealed to the Supreme Court Held Concept of federal common law in diversity of citizenship cases is ended Courts will apply a state s law Pennsylvania law applies Tompkins is a trespasser Erie is not liable Applying Appropriate Law in State Cou Incidents of the case take place in more than one state Con ict of laws or choice of law rules apply Rules vary according to nature of dispute ie Contract cases Laws of state in which contract was made will be applied Tort cases Laws of state where tort takes place States try to look at interests of the parties government policies General rule Laws apply for state that has the most significant interestquot See Williamson Pounder Architects PC v Tunica County Mississippi Williamson Pounder Architects PC v Tunica County Mississippi Tunica County Mississippi hired William Ponders Architects WPA a Tennessee company WPA to design and supervise construction of a riverfront park Year later WPA met with Tunica County MI personnel walrlted to increase the size of project for 18 million to 22 ml Ion County Administrator orally approved increase Later bills were submitted by WPA for extra work Tunica county refused to pay Board Of Supervisors did not approve extra expenses Lack of approval was in its Minutes of its meeting WPA sued County in federal court in Mississippi for breach of contract Original contract contained a choiceoflaw provision This provision stated Tennessee law would govern any dispute Tunica County said Mississippi should govern District Court agreed with Tunica County WPA appealed Continued Williamson Pounder Architects PC V Tunica County Mississippi cont HELD Affirmed District Court was correct Mississippi law applied No oral adjustment to contract with WPA is enforceable Contract choiceoflaw provision This Agreement shall be governed by the law of the principal place of business of the Architect Principal place of business is Tennessee Usually courts will give effect to such an express agreement Exception absence anything violating 1 public policy or 2 forum jurisdiction Center of gravity concept is applied Focuses on which state has the most substantial contacts with parties and subject matter of action Center of gravity must be applied to the issue of this case Where center of gravity pulls forcefully on another state s law and is contrary to strongly felt public policy of Mississippi law court will enforce Mississippi positive substantive law This is breach of contract issue Tennessee law violated Mississippi s public policy that oral contracts cannot be formed or enforced against county boards of supervisors In Mississippi county s Board of Supervisors can act only through its Minutes here it did not improve the increase VENUE Appropriate geographical location proper place where the lawsuit is heard In controversial or well publicized cases defendants will ask for W Will be in same court system but likely in a different geographical location Doctrine of FORUMNON CONVENIENS a special venue doctrine Either party may request a change of venue to a more convenient court that could hear the case Court will consider such issues as Where actions of case take place Where witnesses are located Unfair burdens to parties See Super Judicial Powers See Test Yourself p 49 Super Judicial Powers Florentino Floro handle civil amp criminal cases as ajudge in Manila the Philippines After 3 years there were rumors about his behavior Resulted in an investigation in which the Supreme Court suspended him during investigation Floro confirmed he regularly consulted three elves Angel Armand amp Luis for advice He would only wear black robes on Friday To recharge his psychic powers began court sessions with reading from the Book of Revelations Conducted handson healing session for members of the public in his chambers After 5 years investigation was removed from the bench Filed multiple appeals to the Supreme Court and lost Was ordered to stop filing appeals Then filed an application to be appointed to the Courtllll
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