1. CIVIL PROCEDURE ESSAY SERIES ESSAY QUESTION #4 MODEL ANSWER
CIVIL PROCEDURE ESSAY SERIES
ESSAY QUESTION #4
MODEL ANSWER
Salesco, a State X corporation, commenced an action in a State X federal district court alleging $100,000 in damages for a breach of contract by Parts, Inc. (Parts) to sell and deliver four shipments of parts to Salesco. The complaint alleged that each shipment would have produced a profit of $25,000 to Salesco. Parts does business in all 50 states. It is incorporated and has its corporate headquarters in State A.
In its original complaint, Salesco named "Subparts, Inc." (Subparts) as the defendant, but served Parts. Subparts is an unincorporated division of Parts. Salesco thereafter filed and served an amended complaint alleging the same action but naming Parts as the defendant. However, the amended complaint was neither filed nor served on Parts until after the relevant State X statute of limitations had expired.
Parts timely moved to dismiss Salesco's action on the following grounds: (1) the claim was barred by the statute of limitations; (2) under no circumstances could damages be more than $70,000; and (3) there was no diversity between the parties. The court denied Parts' motion.
Thereafter, Parts filed a third party complaint seeking indemnification against Distribco, a company incorporated in State X. Distribco timely moved to dismiss the third party complaint on grounds of lack of diversity jurisdiction over it. The court denied Distribco's motion.
1. Did the court properly deny Parts' motion to dismiss? Discuss.
2. Did the court properly deny Distribco's motion to dismiss? Discuss.

2. I. DID THE COURT PROPERLY DENY PARTS’ MOTION TO DISMISS BASED ON STATUTE OF LIMITATIONS, LACK OF APPROPRIATE DAMAGES, AND NO DIVERSITY.
ERIE DOCTRINE.
Statute of Limitations.
State Substantive Law. Apply.
Federal Procedural Law.
AMENDED COMPLAINT.
Relations - Back Rule.
An amended complaint adding a new party after the statute of limitations has expired, will relate back to the filing of the original complaint if the following requirements are met:
Same transaction/occurrence.
Added party must have had reason to know. Within the 120 day service limit.
No prejudice to defendant.
DIVERSITY OF CITIZENSHIP.
Amount in Controversy - Good Faith Estimate.
LEGAL CERTAINTY TEST. More than $75K.
COMPLETE DIVERSITY.
Corporations. State of Incorporation and Principal Place of Business.

3. II. DID THE COURT PROPERLY DENY DISTRIBCO’S MOTION TO DISMISS
IMPLEADER.
An impleader allows a party to bring in a third-party defendant in a vicarious liability action. The claim against the third-party defendant must be derivative, such as through contribution or indemnification. The plaintiff may assert a claim against the third-party defendant if the new claim arises out of the same transaction or occurrence as plaintiff's original claim, and the new claim meets the requirements of subject matter jurisdiction / or supplemental ancillary jurisdiction.
SUPPLEMENTAL JURISDICTION / ANCILLARY. Subject matter jurisdiction must be show for most claims, however, some claims that cannot satisfy subject matter jurisdiction on their own may still be heard. In diversity claims, a federal court may exercise ancillary jurisdiction, allowing the court to join parties that would otherwise have been non-diverse, or that would have lacked sufficient amount in controversy, if their claim is so related to the original claim that they form part of the same case or controversy.
CONCLUSION. The court property denied the motion to dismiss.