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Monday, February 25, 2013

More jurisdiction from SCOTUS

SCOTUS last week decided two of the jurisdiction/procedure/Fed Courts cases on this term's docket. In Gunn v. Minton, the Court unanimously held that a legal malpractice claim derived from a patent dispute does not “arise under” federal law so as to vest exclusive jurisdiction in federal court. In Chafin v. Chafin, the Court unanimously held that an action under the Hague Convention on the Civil Aspects of International Child Abduction does not become moot when the child is returned to her country of habitual residence while an appeal is pending.

A few random thoughts on the cases after the jump.

1) These cases, along with last month’s Already LLC v. Nike, Inc. (a defendant's voluntary cessation through a covenant not to sue renders a case moot), continue the Roberts Court’s interest in procedure and jurisdiction. Interestingly, Chief Justice Roberts kept all three opinions for himself; he did not assign them to either of the former civ pro professors, nor to the former district judge with ground-level civ pro experience. Perhaps Roberts himself is driving this civ pro revival. And as with most of this run of civ pro cases (Iqbal and Wal-Mart being glaring exceptions), all three decisions were unanimous (Already included a short concurrence from Kennedy, Thomas, Alito, and Sotomayor, warning lower courts about the narrowness of the Court's decision).

2) Gunn does a very nice job of explaining the two situations in which a case arises under federal law. In describing the core "rule of inclusion" that "accounts for the vast bulk of suits that arise under" (federal law creates the cause of action), the Court cites American Well Works (the original opinion by Justice Holmes) rather than the Court’s more recent statement in last term’s Mims v. Arrow Fin. Servs. This is surprising because Mims appeared to elaborate and expand on the Holmes test, looking not only to the source of the cause of action but also to the source of the rule of decision (or right) asserted. (Lou Mulligan wrote a great analysis of Mims). Not sure if this reflects a backing away from the more-elaborate statement of the standard in Mims or just invocation of the “Cite Holmes Whenever Possible” Principle.

3) Gunn also does a good job of turning Grable & Sons Metal Prods. v. Darue Engineering into a clean four-part test for analyzing when state claims with embedded federal issues arise under. At the same time, it seems to modify the third prong, which requires the federal issue be “substantial.” While this could have meant substantial within the case (that is, an important aspect of the case or important to the parties), Gunn insists that it means substantial to federal law and the federal judicial system as a whole. Thus, while the validity of the notice provided by the IRS in enforcing a tax lien (the embedded issue in Grable & Sons) was substantial in that it broadly affected the government’s ability to recover delinquent taxes, a patent issue buried as a “case-within-a-case” in a backward-looking claim for damages is not substantial because it does not effect federal patent law or the work of federal courts at a systemic level.

This form of substantiality in turn overlaps with and affects the fourth prong of the analysis--whether the congressionally approved balance of caseloads would be altered by allowing this class of case into federal court. Because the federal issue is not substantial, keeping it in state court is plainly not inconsistent with that balance--end of analysis.

4) Gunn did not discuss one other unique aspect of this case--whether the exclusivity of patent jurisdiction affects the fourth-prong of Grable. Federal jurisdiction in patent cases is exclusive. Thus, holding that these cases arise under federal law not only allows them to be filed in federal court and gives the parties a choice of forum, it requires them to be filed in federal court and eliminates state courts as an available. Thus the "balance" question looks very different--it is not only about creating an additional forum, it is about stripping state courts of jurisdiction. But because the balance question was largely resolved by the substantiality question, the Court did not have to consider this.

5) Chafin and Already appear to be good teaching cases on mootness. Both demonstrate the links between mootness and other doctrines. Already shows how standing and mootness interact. In arguing that the case was not moot, Already tried to identify harms that it continued to suffer despite the covenant not to sue; the Court insisted that none of these harms could establish Article III standing in the first place and therefore could not demonstrate a continuing controversy to overcome mootness.

Chafin discusses the difference between mootness and merits and explicitly seeks to maintain a line between them (an effort I always appreciate from the Court). The district court held that Scotland (where the child had lived with her British mother) was her country of habitual residence; the mother moved back there with her daughter while the appeal was pending (after the district court refused to stay the case pending appeal). The mother tried to show mootness by arguing that even if the court of appeals reversed, the district court could not issue a "re-return" order under the Convention, Scottish courts would ignore the re-return order, or she was not subject to enforcement of that order in Scotland. But the Court insisted this "confuses mootness with merits"--the utlimate legal availability or effectiveness of relief are not pertinent to the mootness inquiry. This principle holds at least so long as the merits arguments are not "so implausible that it is insufficient to preserve jurisdiction," a reservation I could have done without, as it leaves a glimmer of merits defects limiting jurisdiction. Still, I was pleased to see the Court sharply rejecting merits-based arguments against jurisdiction.

6) Roberts throws into each of these opinions one or two pithy turns of phrase--metaphors, cultural references, etc. In Already, rejecting the argument that Already might make a new, potentially infringing shoe not covered by the covenant, Roberts said such a shoe "sits, as far as we can tell, on a shelf between Dorothy's ruby slippers and Perseus's winged sandals." In Gunn, in pointing out that it was not creating embedded-issue doctrine on a blank canvas, he said "[u]nfortunately, the canvas looks like one that Jackson Pollock got to first." There was less of this in Chafin (perhaps because a cross-border child-custody dispute invites more judicial seriousness than an intellectual property fight), although at one point he said that the case was not moot because "[n]o law of physics" prevents the child's return from Scotland if the district court orders it and the mother complies. Roberts obviously is trying to be an engaging writer (in cases that most observers may not find engaging). Does it work? Or does it just come across as snarky and distracting?

7) We still are waiting for the Court's other big jurisdiction case, Kiobel v. Royal Dutch Petroleum, which was the first case argued this term. Obviously there is going to be a dissent and perhaps multiple opinions in the case, hence the delay. What remains to be seen is whether the division on the Court is about the jurisdictionality of corporate liability under the ATS or just about corporate liability generally.

Posted by Howard Wasserman on February 25, 2013 at 09:31 AM in Civil Procedure, Howard Wasserman | Permalink


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"This principle [of jurisdiction having nothing to do with merits] holds at least so long as the merits arguments are not 'so implausible that it is insufficient to preserve jurisdiction,' a reservation I could have done without, as it leaves a glimmer of merits defects limiting jurisdiction.".
This glimmer goes back at least to Oneida Indian Nation, 414 U.S. 661 (1974), where the word "implausible" was accompanied by "insubstantial" and "otherwise completely devoid of merit.". Indeed it's in Bell v. Hood, 327 U.S. at 682-83 (1946), though using the words "insubstantial" and "frivolous" and not the word "implausible."

I do find the choice of "implausible" concerning; Roberts could not have been unaware that it evokes Iqbal's "plausibility" test, which shouldn't in my view apply to jurisdictional decisions. (60 Clev. St. L. Rev. 799, citing Wasserman). Seems incautious, although perhaps he feared "insubstantial" would have been muddling as an echo of Grable.

Always good to see Steel Co. reprised.

Posted by: Jim von der Heydt | Feb 27, 2013 5:54:11 PM

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