Business Law I Courts, Litigation & Alternative Dispute Resolution

Federal Courts Two kinds of civil lawsuits permitted in Federal Courts - Federal Question Cases A claim based on the United States Constitution, a federal statute, or a federal treaty Diversity Cases When the plaintiff and defendant are citizens of two different states, AND the amount in dispute is greater than $75,000

Federal Court System Trial Courts Appellate Courts United States District Courts are the primary trial courts in the federal system. The nation is divided into about 94 districts (based on population), each with its own District Court. There are also specialized trial courts, such as Bankruptcy Court and Tax Court. Appellate Courts United States Courts of Appeals are the intermediate courts of appeals. The nation is divided into thirteen circuits. The highest appeals court is the United States Supreme Court.

(Highest Appeals Court) The Federal Court System United States Supreme Court (Highest Appeals Court) Nine Justices; appointed for life; may refuse to hear a case; final authority U.S. Court of Appeals for the Federal Circuit U.S. Court Of Appeals (12 Circuits) Lower Appeals Courts Three judges hear each case, brought up from the District Courts. Hears appeals from specialized trial courts. U.S. Tax Courts U.S. District (94 Districts) Bankruptcy Various Federal Agencies Primary Trial Court Trial Courts of Limited (Specific) Jurisdiction U.S. Court of International Trade U.S. Court of Claims U.S. Patent & Trademark Office Trial Courts of Limited (Specific) Jurisdiction

Geographic Boundaries of United States Courts of Appeals and United States District Courts DC Fed

Federal Forums of Limited (Specific) Jurisdiction Bankruptcy Court, Tax Court, Court of International Trade, Patent and Trademark Court - These trial courts in the federal system hear cases appropriate to their names (tax cases in the Tax Court, etc.) Appeals from the Bankruptcy and Tax Courts are heard by the Court of Appeals in the appropriate circuit. Appeals from the Court of International Trade and the Patent & Trademark Court are heard by the Court of Appeals in the Federal Circuit. U.S. Court of Claims - Hears cases brought against the United States, typically on contract disputes. Various Federal Agencies - Though not actually a part of the Judicial Branch of the Federal government, many Federal agencies have the power to create and enforce appropriate regulations.

State Court System Trial Courts Appellate Courts Almost all cases begin in trial courts, with a judge and usually a jury. Trial courts determine the facts of a particular dispute and apply the law to those facts. Courts can only hear cases under their jurisdiction. Appellate Courts Appeal courts generally accept the facts given to them by trial courts and just review the trial record to see if the court made any errors of law. The highest appeals court in a state is the state Supreme Court.

Massachusetts Court System Trial Courts District Courts and the Boston Municipal Courts are the primary trial courts that handle civil cases <$25,000 and criminal cases where the penalty is <5 years. Superior Courts are the primary trial courts that handle civil cases >$25,000 and criminal cases where the penalty is >5 years. There are 14 Superior Courts whose jurisdictions are divided by county. There are also specialized trial courts, such as Small Claims Courts and Traffic Courts. Appellate Courts The Massachusetts Appeals Court is the intermediate courts of appeals. The highest appeals court is the Massachusetts Supreme Judicial Court.

The Massachusetts Court System Supreme Judicial Court (Highest Appeals Court) Five Justices sit en banc; may refuse to hear a case; final authority Massachusetts Appeals Court (Lower Appeals Court) Three Justices sit en banc; never a jury Superior Courts District Boston Municipal Court Probate & Family Housing Land Juvenile Traffic Courts Small Claims Trial Courts of General Jurisdiction One judge; may have jury Trial Courts of Limited (Specific) Jurisdiction

Geographic Boundaries of Massachusetts Trial Courts

Massachusetts Courts of Limited (Specific) Jurisdiction Small Claims Courts – Hear only civil suits under $2,000 Traffic Courts – Hear only traffic cases Juvenile Courts – Hear only cases involving minors Land Courts – Hear land and real property disputes Probate Courts – Settle estates of deceased persons Family Courts – Handle marital and child custody issues Housing Courts – Handle landlord/tenant disputes

Litigation vs. Alternative Dispute Resolution Litigation -- refers to lawsuits; the process of filing claims in court, and ultimately going to trial. Alternative Dispute Resolution -- is any other formal or informal process for settling disputes without going to trial.

Alternative Dispute Resolution (most common forms) Negotiation Parties make offers and counter-offers for settlements. May be face-to-face or through lawyers. Mediation Neutral person (mediator) attempts to get parties to reach a voluntary settlement. Mediator does not render a decision. Arbitration Neutral person (arbitrator) is involved. Arbitrator often has expertise in area of dispute. Arbitrator renders a binding decision. Arbitration may be mandatory, if chosen in advance as the method for dispute resolution.

Alternative Dispute Resolution (less common forms) Forum Decision Maker Advantages Conductor Minitrial Executives of disputing companies Companies are more likely to settle. Neutral third party Summary Jury Trial Six-member mock jury Disputants are more likely to settle. Judge or magistrate Private Judge (Judge Judy) Hired judge Circumstances are like trial, but without a waiting period.

Litigation Roadmap

Steps in Beginning Litigation Pleadings: Papers that begin a lawsuit 1. Complaint Short, plain statement of the allegations and the legal claims. This is “served” or delivered with a summons. 2. Answer A brief reply to the allegations. 3. Counter Claim Sometimes the accused party will initiate a second suit in response to the first. 4. Reply A brief reply to the counter-claim.

Possible Variations on Pleadings Class Actions If the plaintiff has evidence that the wrong in question has affected a large number of unrelated persons, the suit may become a class-action suit, with the plaintiff representing an entire class of plaintiffs. Default Judgment If the defendant fails to answer in time, the plaintiff will ask for a default judgment, meaning an automatic win without a trial.

Example of a Complaint

Discovery -- next step after pleadings Allows both sides to uncover evidence, encouraging a settlement or ensuring few surprises during a trial. Interrogatories -- written questions that the other party must answer, under oath Depositions -- interview (under oath) of other party or potential witnesses; done by opposing lawyer Production of Evidence -- each side may request to see the other side’s evidence Physical or Mental Exams -- one party may request the court to order an examination of the other party if relevant

Discovery (cont’d) Sometimes the results from interrogatories and depositions will cause one side or the other to file a motion in response. Motion to compel answers to interrogatories – may be made if one side thinks the other has not adequately answered interrogatories Motion for protective order – is a request to the court that the other side be made to reduce the number of depositions.

Case Analysis Motion to Strike Stinton v. Robin’s Wood, Inc., 45 A.D. 3d, 842 NYS2d 477, New York App. Div., 2007 Facts Issue Decision Reasoning

Other Steps Before Trial Summary Judgment -- a ruling by the court that no trial is necessary because there are no essential facts in dispute; may be requested by either side. Final Preparation -- if the case is to proceed to trial, both sides make a list of witnesses and rehearse questions with their own witnesses. Preparation is allowed, but telling the witnesses how to answer is not legal or ethical.

Case Analysis Motion for Summary Judgment Jones v. Clinton, 990 F. Supp. 657, 1998 U.S. Dist. LEXIS 3902, United States District Court for the District of Arkansas, 1998 . Facts Issue Decision Reasoning

Adversary System The adversary system presumes that the truth will be found if lawyers are allowed to question witnesses for both sides. Both the plaintiff and the defendant have the right to request a jury trial, but only in those criminal cases which may result in the death penalty or incarceration for a period of greater than six months is there an absolute right to a jury trial.

Procedural Rules for a Trial Burden of Proof The plaintiff must convince the jury that its version of the case is correct. In a civil case, the proof needs to be by a preponderance of evidence (meaning at least slightly more likely to be true). In a criminal case, the proof required is higher; it must be beyond a reasonable doubt.

The Plaintiff’s Case Opening Arguments Plaintiff Calls Witnesses This is a brief summary, given by each side, of the facts they hope to demonstrate. Plaintiff Calls Witnesses Questions to own witnesses is direct examination. Lawyer only asks questions with helpful answers. Defendant Questions Witnesses Questions to opposing witnesses is cross examination. Again, lawyer asks questions with helpful answers. Defendant Moves for Directed Verdict This is asking the judge to decide that the plaintiff has no case worth proceeding with.

The Defendant’s Case Opening Arguments Defendant Calls Witnesses Defendant’s opening arguments were presented earlier, before the plaintiff presented its case. Defendant Calls Witnesses Questions to own witnesses is direct examination. Lawyer only asks questions with helpful answers. Plaintiff Questions Witnesses Questions to opposing witnesses is cross examination. Again, lawyer asks questions with helpful answers. Closing Arguments Brief summary, by both sides, urging the jury to believe their side of the case.

After Both Sides Rest (Finish) Jury Instructions The judge instructs the jury to evaluate the case solely on the facts of the evidence presented. If the case is influenced by a certain legal presumption, the judge will summarize that for the jury. Deliberation and Verdict The jury discusses the case for as long as needed (anywhere from less than an hour to several weeks). Sometimes the jury must be unanimous; other times only a majority (at least 7) or a 10-2 vote is required.

The Trial is Over… or is it? Motions after the Verdict The loser might request the judge to overturn the verdict on a legal technicality or on a claim that the jury ignored the evidence. Appeal The recourse for the loser is to file an appeal, a request for a higher court to examine the facts. The appeals court may affirm the verdict, modify the award, reverse and remand (send it back to trial) or simply reverse (overturn) the lower court’s verdict. Settlement At any point, either side may offer to settle the case, even between the verdict and the beginning of an appeal.

Quiz Matching Questions Arbitration Diversity Jurisdiction Mediation Interrogatories Deposition 1.  A pretrial procedure involving written questions to be signed under oath. 2.  A form of ADR in which the parties themselves craft the settlement. 3.  A pretrial procedure involving oral questions answered under oath. 4.  The power of a federal court to hear certain cases between citizens of different states. 5.  A form of ADR that leads to a binding decision.

Quiz True/False Questions One advantage of arbitration is that it provides the parties with greater opportunities for discovery than litigation does. In the United States there are many separate courts, but only one court system, organized as a pyramid. If we are listening to witnesses testify, we must be in a trial court. About one-half of all lawsuits settle before trial. In a lawsuit for money damages, bot the plaintiff and the defendant are generally entitled to a jury. F T F F

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