Chapter 3 Courts and Alternate Dispute Resolution

1. Chapter 3 Courts andAlternate Dispute Resolution

2. Learning Objectives • What is judicial review? How and when was the power of judicial review established? • Before a court can hear a case, it must have jurisdiction. Over what must it have jurisdiction? How are the courts applying traditional jurisdictional … 

3. Learning Objectives • … concepts to cases involving Internet transactions? • What is the difference between a trial court and an appellate court? • What is discovery, and how does electronic discovery differ from traditional discovery? 

4. Learning Objectives • What are three alternative methods of resolving disputes?

5. The Judiciary’s Role in American Government • Judicial Review. • Established by the U.S. Supreme Court in Marbury v. Madison (1803) where Chief Justice Marshall wrote: • “It is emphatically the province and duty of the judiciary to say what the law is….”

6. Basic Judicial Requirements • Jurisdiction Over Persons or Property. • “Juris” (law) “diction” (to speak) is the power of a court to hear a dispute and to “speak the law” into a controversy and render a verdict that is legally binding on the parties to the dispute.

7. Basic Judicial Requirements • Jurisdiction Over Persons or Property. • Also called “in personam” jurisdiction. • Power of a court to compel the presence of the parties (including corporations) to a dispute to appear before the court and litigate.

8. Basic Judicial Requirements • Jurisdiction Over Persons or Property. • In Rem. Court has “in rem” power to decide issues relating to property, whether the property is real, personal, tangible, or intangible, within its geographical borders.

9. Basic Judicial Requirements • Jurisdiction Over Persons or Property. • Long Arm Statutes. Courts use long-arm statutes for non-resident parties based on “minimum contacts” with state.

10. Basic Judicial Requirements • Jurisdiction Over Persons or Property. • Corporate Contacts. Usually jurisdiction in the state it was incorporated, principal place of business, places goods in stream of commerce or actively advertises. 

11. Basic Judicial Requirements • Jurisdiction Over Persons or Property. • Corporate Contacts. • CASE 3.1 Southern Prestige Industries, Inc. v. Independence Plating Corp. (2010). Did the New Jersey firm have minimum contacts with North Carolina?

12. Basic Judicial Requirements • Jurisdiction Over Persons or Property. • Jurisdiction Over Subject Matter. Limitation on the types of cases a court can hear, usually determined by federal or state statutes, e.g., bankruptcy, probate, family, or criminal cases.

13. Basic Judicial Requirements • Jurisdiction Over Persons or Property. • Original and Appellate Jurisdiction. • Courts of original jurisdiction is where the case started (trial). • Courts of appellate jurisdiction have the power to hear an appeal from another court.

14. Basic Judicial Requirements • Jurisdiction of the Federal Courts. • Federal Question: rights or obligations of a party are created or defined by some federal law. • Diversity cases where: • The parties are not from the same state, and • The amount in controversy is greater than $75,000.

15. Exclusive vs. Concurrent Jurisdiction

16. Jurisdiction in Cyberspace Substantial Business Interaction No Depends Yes PassiveWebsite • The “Sliding Scale” Standard. Some Interactivity through a Website

17. Jurisdiction in Cyberspace • International Jurisdiction Issues. • How do federal courts apply the ‘sliding scale’ standard? • CASE 3.2 Gucci America, Inc. v. Wang Huoqing (2011). What was the main factor in the court’s decision to find sufficient contact?

18. Basic Judicial Requirements • Venue. • Venue is concerned with the most appropriate location for the trial. • Generally, proper venue is whether the injury occurred.

19. Basic Judicial Requirements • Standing to Sue. • In order to bring a lawsuit, a party must have “standing” to sue. • Standing is sufficient “stake” in the controversy; party must have suffered a legal injury. There must be a “justiciable controversy.”

20. State and Federal Court Systems Federal Courts Texas Courts Ct. Criminal Appeals Supreme Court U.S. Supreme Court Court of Appeals Circuit Courts of Appeals District Court County Court Justice Court Municipal Court U.S. District Court 20

21. State and Federal Court Systems

22. State Court System • Trial Courts: general or limited jurisdiction. • Small Claims Courts: informal, involving claims of less than a certain amount, e.g., $2,500 or $5,000, depending on state statute.

23. State Court System • Appellate, or Reviewing, Courts. • Every state has at least one appellate court. • Focus on Questions of Law. • Defer to Trial Court’s Finding of Facts.

24. State Court System • Highest State Courts. • Highest appellate court in a state. • Decisions by a state supreme court are final on all questions of state law. • Issues of federal law can be appealed to the federal court system. 

25. Federal Court System U.S. Supreme Court Circuit Courts of Appeals U.S. District Courts Writ of Certiorari to bring case 13 U.S. Courts of Appeal  Equivalent to State Trial Court

26. U.S. Courts of Appeal

27. U.S. Supreme Court www.supremecourt.gov

28. Following a State Court Case • The Pleadings. • Plaintiff’s Complaint. • Service and Summons. • Defendant’s Answer, Motion to Dismiss, or Counterclaim.

29. Following a State Court Case • Pre-Trial Motions. • Motion for Judgment on the Pleadings. • Motion for Summary Judgment.

30. Following a State Court Case • Discovery. • Depositions and Interrogatories. • Requests for Other Information. • Electronic Discovery. • Pre-Trial Conference. • Jury Selection (Voir Dire).

31. Following a State Court Case • At The Trial. • Opening arguments. • Plaintiff’s Case in Chief. • Defense cross-examines Plaintiff’s witnesses. • Directed Verdicts. • Closing Arguments and Awards.

32. Following a State Court Case • Posttrial Motions. • Motion for J.N.O.V. • Motion for New Trial. • The Appeal. • Filing the Appeal: Briefs pointing out reversible error that require reversal of the trial court’s verdict.

33. Following a State Court Case • The Appeal. • Appellate Review. • Courts do not consider new evidence. Only consider briefs and evidence presented at trial. • Enforcing the Judgment.

34. Courts Adapt to the Online World • Electronic Filing. • Courts Online. • Cyber Courts and Proceedings. • Negotiation. • Mediation. • Arbitration (employment contracts).

35. Alternative Dispute Resolution • Trials are a means of dispute resolution that are very expensive and sometimes take many months to resolve. 

36. Alternative Dispute Resolution • There are “alternative dispute resolution” (ADR) methods to resolve disputes that are inexpensive, relatively quick and leave more control with the parties involved.

37. Alternative Dispute Resolution • ADR describes any procedure or device for resolving disputes other than the traditional judicial process. • Most common: negotiation, mediation, arbitration. 

38. Negotiation • Less than 10% of cases reach trial. • Negotiation is informal discussion of the parties, sometimes without attorneys, where differences are aired with the goal of coming to a “meeting of the minds” in resolving the case.

39. Mediation • Involves a neutral 3rd party (mediator). • Mediator talks face-to-face with parties (who typically are in different adjoining rooms) to determine “common ground.” 

40. Mediation • Advantages: few rules, customize process, parties control results (win-win). • Disadvantages: mediator fees, no sanctions or deadlines.

41. Arbitration • Many employment contracts have binding arbitration clauses. • Settling of a dispute by a neutral 3rd party (arbitrator) who renders a legally-binding decision; usually an expert or well-respected government official. 

42. Arbitration • Arbitrator’s Decision. Can be set aside by a court if: • Bad faith or prejudice. • Violates public policy. • Exceeds arbitrator’s powers. 

43. Arbitration • Arbitration Clauses and Statutes. • Uniform Arbitration Act of 1955. • Federal Arbitration Act. • CASE 3.3 Cleveland Construction, Inc. v. Levco Construction, Inc. (2012). Why did the court find the FAA preempted the Texas statute?

44. Arbitration • Issue of Arbitrability. • No party will be compelled to arbitration unless a court finds the party consented, and that they are fair to both parties.

45. Arbitration • Mandatory Arbitration in the Employment Context. • Generally clauses are enforceable. • Gilmer decision (1991). • Arbitrators do not have to follow precedent or rules of procedure or evidence. 

46. Arbitration • Mandatory Arbitration in the Employment Context. • Private Arbitration Proceedings.

47. Alternate Dispute Resolution • Other Types of ADR. • Assisted Case Evaluation. • Mini-Trial. • Binding mediation. • Summary Jury Trial.

48. Alternate Dispute Resolution • Providers of ADR Services. • American Arbitration Association. • Hundreds of for-profit firms provide ADR services. • Retired judges.

49. Online Dispute Resolution • Also called ODR. • Uses the Internet to resolve disputes. • Still in its infancy but is gaining momentum. • See, e.g.,www.cybersettle.com.