Civ Pro 2 Notes 8/20/04


We left off with the short story of pleading.The bottom line is that Rule 8 is ďnotice pleadingĒ.Notice should be sufficient to withstand a motion to dismiss.Itís possible to have a statement thatís too long.A complaint could be so detailed that a court could dismiss it on the basis of prolixity.A 4,000 page complaint is too damn much!Notice that you can plead inconsistently.Itís provided for in Rule 8(e)(2).You can set forth alternate or hypothetical statements of claims or defenses regardless of consistency.This may make us uneasy that we can plead things that are internally inconsistent.But Clark wanted a system where when youíre putting the other party on notice early, even though you might not know what your various causes of action are exactly.


Ethical limitations


Yesterday, we looked at the plight of Haddle.Haddle lost in the trial court because the law of the circuit said that he had no property interest in his continued employment.What if the law said that had a property interest if the company had promised it would only terminate him for cause?In other words, heís still in an at-will state, but the company has promised only to fire him for cause.Could Haddle amend his pleading to avoid 12(b)(6)?Shouldnít he have thought of that the first time around?Why canít he make that point going forward, though?But we donít know whether the company promised him he would only be dismissed for cause.You canít just lie to get past 12(b)(6).


Rule 11


Rule 11 is a long rule.Every piece of paper filed in a court shall be signed by at least one attorney or pro se party.Stuff thatís filed has to be signed!The reason itís important comes in 11(b): you assert that youíve done a reasonable investigation and you, in good faith, think youíre properly filing the document.You canít harass or delay!You have to have non-frivolous claims!You have to have facts that can be supported by evidence!There is a tension in the Rules: plead quickly and get the lawsuit started, but Rule 11 says that you must have done reasonable investigation first. What are the consequences?The court can impose sanctions!Attorneys, firms, or parties can be sanctioned.Rule 11(c) sets out a detailed process for how we do this.


You can mostly just read Rule 11 and youíll get it.If it ainít filed with the court, it ainít a Rule 11 violation!If thereís no document, or itís not filed, or thereís no courtÖno violation.What about groundless discovery?Rule 11 doesnít apply to discovery!Thereís a different part of the Rules that deal with discovery abuses: Rule 26.The penalty scheme there is different.What about a client who brings in a frivolous lawsuit and you rush to file it?The attorney can get knocked for Rule 11(b)(3).It looks like there was no investigation!You need an ďinquiry reasonable under the circumstancesĒ.That means you might be off the hook if the client comes to you when the statute of limitations is almost over.If you only have a day to file the lawsuit, they might go easier on you.


Walker v. Norwest Corp.


This is a case of lawyers failing to investigate the law, which isnít that common.The lawyer filed a lawsuit in federal court claiming diversity.We must have complete diversity.The Walkers are from South Dakota, and Norwest is from Minnesota.The problem is that they said that the plaintiffs and some of the defendants were from different states, and some of them were actually from South Dakota as well.Oops!!!Having a South Dakota defendant will violate the rule of complete diversity.This is an interpretation of 28 U.S.C. ß 1332.On the face of the complaint, thereís no federal jurisdiction.Norwest sent the plaintiffís lawyer notice of this.They try to be nice about it.Massey ignores them, basically.Norwest files a motion to dismiss and a motion for Rule 11 sanctions.


Why does Massey argue that Rule 11 sanctions are inappropriate here?He says it would be too hard to figure out where the defendants are from!Tough, dude!Plaintiffs have managed to do this basically forever.So the argument is stupid on its face.Itís not surprising the sanctions were affirmed given that thatís the extent of his argument.


Pay attention to what Norwest does.Theyíre represented by sophisticated litigation counsel.Do they follow appropriate procedure?Rule 11(c)(1)(A) tells us that we initiate sanctions by motion after we first give the other party 21 days to withdraw their motion.Norwest sent the guy a letter.They didnít really serve him.Norwest appears to have messed up!To do this right, they should have drafted its motion for Rule 11 sanctions, served it on Massey, waited 21 days, see if he dismissed the lawsuit, and only then file the motion with the court.This is the safe harbor provision.It tries to let lawyers work these issues out without taking up the courtís time.So how do we get an affirmation of the sanctions?Luckily, thereís another bit, Rule 11(c)(1)(B), which lets the court impose sanctions sua sponte.Did the district court issue a show cause order?We donít know.Law firms can have their own Rule 11 procedure.You would have to get your Rule 11 motions approved by your firmís ethics committee.


Christian v. Mattel, Inc.


There are dates stamped on the back of Barbiesí heads!If the plaintiffís attorney had done even the most basic research, he would have found that the suit was absolutely meritless.The plaintiffís attorney, Hicks, did lots and lots of stuff wrong.Why would Mattel have pursued the strategy it pursued?It files its motion for summary judgment first and then files for Rule 11 sanctions as opposed to filing for Rule 11 sanctions first and getting the lawsuit dismissed.This massively runs up the bill, where you could have had the same result much faster and cheaper.But Mattel wants to send a message: donít screw with us.They chose a more expensive and protracted strategy.This is similar to how WalMart vigorously litigates slip-and-fall cases.The district courtís Rule 11 orders are vacated!The district court, in all its excitement, imposed sanctions for stuff that you canít impose sanctions on under Rule 11.You can only be sanctioned for the filing of improper papers!The district court goes beyond that in its justification.Hicks gets a short term victory in the Court of Appeals, but heíll get hammered when it goes back to the district court.Itís a victory, in the long haul, for Mattel.Mattel made a mistake when they offered up all these different grounds for Rule 11, including some that werenít right.


The bottom line is that Rule 11 provides a way to control the behavior of lawyers based on the filing of documents in court.Itís a good rule!Do you factual investigation!


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