COMPLETE EXAM Q&A STUDY
GUIDE WITH DETAILED
SOLUTIONS
◉ A senator from State A became upset when he learned that
residents of State A are not permitted to bring state law products
liability suits against State A companies in State A federal
courts, but that residents of State B may do so.
The senator plans to introduce legislation that states: "Federal
courts shall have jurisdiction when the plaintiff's cause of action
shows that it is based upon a state products liability law." Is the
proposed legislation constitutional?
A: Yes, because Congress has plenary power to extend federal
jurisdiction to any questions arising under federal law or the U.S.
Constitution.
B: Yes, because Congress has plenary power to create federal
courts and determine their jurisdiction.
C: No, because it would extend federal jurisdiction to state law
claims without requiring diversity of citizenship among the
parties.
D: No, because it would not extend federal jurisdiction to
defendants. Answer: C: No, because it would extend federal
jurisdiction to state law claims without requiring diversity of
citizenship among the parties.
C is correct. If the senator's proposed legislation were to pass, it
would allow a plaintiff to bring suit and avoid the diversity
requirement, which would be unconstitutional.
,◉ A pilot from State A sued a librarian from State B in a
federal district court in State A. The librarian sold the pilot an
expensive collectible watch through a website that generated a
valid sales contract. The pilot's complaint alleged that the
librarian breached the contract's terms because the librarian sold
the pilot a watch that materially varied from the description the
librarian had provided. The pilot is seeking $175,000 in
damages.
Shortly after selling the watch, the librarian went to State A on
vacation with her family. This was the librarian's first time ever
in State A. While visiting State A, the librarian was served with
the pilot's complaint and a summons in accordance with State A
law. The librarian filed a motion to dismiss for lack of
jurisdiction.
Should the court grant the librarian's motion to dismiss?
A: Yes, because only federal courts have jurisdiction to hear
disputes between citizens. Answer: D: No, because the
librarian's physical presence in State A when she was served is
sufficient to establish personal jurisdiction.
D is correct. The court should not grant the motion because both
subject-matter and personal jurisdiction are satisfied. The facts
support diversity jurisdiction based on the citizenship of the
parties and amount in controversy. Furthermore, under Pennoyer
v. Neff, 95 U.S. 714 (1878), a court may exercise personal
jurisdiction over a non-resident defendant if she is present in the
forum state when personally served with process. This occurred
here, when the librarian was in State A on vacation and
personally served with the complaint and summons in
accordance with State A law
◉ A beneficiary of a trust, who is a citizen of State A, has sued
the trustee in federal court in State A for failing to correctly
distribute the income from the trust, seeking an accounting. The
, trustee was personally served with process and the complaint by
the beneficiary's attorney while the trustee was vacationing in
State A. The trustee is a citizen of State B, and the accounts that
are the subject of the trust are located in State B.
What is the trustee's best response to the complaint?
A: Answer the complaint and counterclaim for abuse of process.
B: File an action in a State B court and move to enjoin the State
A action.
C: Move to dismiss for improper service by the attorney.
D: Move to dismiss for lack of personal jurisdiction. Answer: D:
Move to dismiss for lack of personal jurisdiction
D is correct. The court in State A lacks personal jurisdiction
over the trustee. Although the trustee was served in State A, the
facts fail to indicate any other contacts between the trustee and
State A, and the trust assets are located in State B. In addition,
the trustee was sued in a representative capacity but was served
while in State A on a personal vacation. Thus, the trustee can
argue that the service did not establish personal jurisdiction over
him concerning his role as trustee. Further, the trustee has no
minimum contacts as a trustee with State A to satisfy the
requirements of fair play and substantial justice. See Hanson v.
Denkla, 357 U.S. 235 (1958).
◉ A shareholder of a car manufacturing company wants to sue
the company in federal court for breach of fiduciary duty.
What information about the company, besides its place of
incorporation, does the shareholder's attorney need in order to
determine whether the parties are diverse?
A: Where the company distributes its cars.