Come Back Later

Interesting opinion today from the Supreme Court. Apart from being Justice Sotomayor's first opinion, the case presents the interesting question of whether a district court's order denying a claim of attorney-client privilege should be immediately appealable.

The normal rule in federal litigation is the final judgment rule: no appeal of a district court's order is allowed until the case reaches its final judgment, at which time all the orders the district court has made in the course of the case can be appealed. This rule saves time and energy by blocking parties from appealing each order the district court makes, one at a time. Also, if the party that would have appealed an order ends up winning the case anyway, or if the case settles, appeal may be unnecessary. So the final judgment rule is a good general rule.

But sometimes appeal after final judgment may not do anything for the appellant. For example, if the defendant in a criminal case seeks bail pending trial and is denied, an appeal after the trial is over does no good -- the harm of not getting bail is irreversible at that point. So the Supreme Court has allowed appeal of "collateral" orders -- orders that are collateral to the merits of a case, that raise an important issue, and that are not effectively remediable by appeal of the final judgment.

So why doesn't the denial of a privilege claim fall in that category? After all, if a party is made to reveal a privileged communication, the communication can't be unrevealed by an appellate reversal years later. The party needs appellate review before revealing the communication.

The Supreme Court's almost-unanimous opinion focuses more on the need to avoid too many piecemeal appeals than on the strict logic of the collateral order doctrine. The Court said that the attorney-client privilege, considered as a whole, can be protected sufficiently by appeal, even if the privilege is wrongly lost in some individual cases. That will be cold comfort to litigants whose privilege is wrongly denied by district courts.

The Court's opinion perhaps makes good policy sense, but it reveals some weaknesses in the official statement of the collateral order doctrine.

Icky Iqbal

Quite a decision from the Supreme Court yesterday: in a case called Iqbal, by a 5-4 vote (and you won't need me to tell you who was in the 5 and who in the 4), the Court dismissed a lawsuit by someone who claimed that in the wake of 9/11 he was arrested and subjected to unconstitutional treatment because of his race, religion, and/or national origin. (The plaintiff was a Pakistani Muslim.) The plaintiff specifically claimed that Attorney General John Ashcroft and FBI Director Robert Mueller personally condoned and willfully and maliciously subjected him to harsh treatment on these illegal grounds. But the Court dismissed the case.

What's remarkable about the case is this: the Court dismissed the case based solely on the pleadings. The Court said that the plaintiff wasn't even entitled to an opportunity to try to prove his case against Ashcroft and Mueller. The plaintiff alleged that these officials acted against him out of illegal bias, but it didn't provide much evidence for this allegation.

And of course, normally, that wouldn't matter. The complaint just starts a case. Plaintiffs aren't required to plead their evidence. If I sue you and say in my complaint, "you punched me in the nose," and you say, "no, I didn't," that's not an excuse for dismissing the case. We have to have a process for determining who's telling the truth, and that process is called trying the case.

Dismissal is appropriate only if my allegations, even assuming them to be true, don't amount to a real complaint. If I say, "you made a nasty face at me," that complaint could be dismissed, because even if you did, there's no law against it. If I say, "you were my employer and you fired me for no reason," that complaint could be dismissed, because, guess what, employers are generally allowed to fire their employees for no reason.

So the normal rule is that the allegations of a complaint are assumed to be true for purposes of a motion to dimsiss. But in a recent case called Twombly, and even more in yesterday's Iqbal case, the Supreme Court has upset decades of pleading law by deciding that sometimes, a court can determine that it doesn't need to accept "conclusory" allegations. The problem with Iqbal's complaint, apparently, was that he alleged that he didn't sufficiently allege facts that would help prove the defendants' allegedly illegal motives.

This is a bad decision. Sure, the plaintiff needs to prove his case at some point. But that's not the function of the complaint. The complaint serves only to give the defendants general notice of what the case is about. We have other processes for determining whether the plaintiff really has a case: discovery, summary judgment, and, ultimately, trial.

Not only will this case be used as an excuse by judges to get rid of cases they don't like, but it will result in decades of confusion about what constitutes a "conclusory" allegation and what is a sufficient factual pleading. A great achievement of the Federal Rules of Civil Procedure was that they put an end to pointless, time-consuming squabbles about how much had to be in the complaint. Now the Supreme Court has reinstated this pointless battle.

FNC before jurisdiction?

OK, this post is for lawyers only. And frankly, even most lawyers will find it boring. I'll try to get something of more general interest up later today.

Today the Supreme Court decided Sinochem Int'l Co v. Malaysia Int'l Shipping Co.. In this dispute between a Chinese company and a Malaysian company, the district court dismissed on grounds of forum non conveniens, even though it was uncertain whether it had personal jurisdiction over the defendant, and there was some issue about subject matter jurisdiction too. The burning question thus presented: can a district court dismiss on FNC grounds without first making sure it has jurisdiction?

The Court said yes. Nine years ago, in Steel Co. v. Citizens for Better Environment, the Court took quite a harsh view of the doctrine of "hypothetical jurisdiction." Sometimes, a court is faced with a case posing a difficult question of jurisdiction, but it's obvious that the plaintiff's ultimate claim on the merits is a complete loser. In such cases, the lower courts had gotten into the habit of saying, "why should we waste our time deciding the hard jurisdictional question when we can see that the plaintiff is just going to lose anyway?" and dismissing these cases on the merits. This sensible procedure saved everyone time and effort.

Well, the Supreme Court got all huffy and reminded those unruly inferior judges that jurisdiction is sacred. A court cannot act if it lacks jurisdiction, and so "hypothetical jurisdiction" is forbidden. A court must make sure it has jurisdiction before dismissing a case on the merits, no matter how easy the merits question and how hard the jurisdictional question.

This insistence on jurisdictional purity naturally led to much waste of time, and the Supreme Court has been backing away slowly ever since. In Ruhrgas AG v. Marathon Oil Co. (1989), the Court held that a court can dismiss a case for lack of personal jurisdiction without deciding whether it has subject-matter jurisdiction. Even though subject-matter jurisdiction is usually thought of as being "above" personal jurisdiction, the Court held that there is no jurisdictional hierarchy. So a personal jurisdiction dismissal is not a real "action" that a court must have subject-matter jurisdiction to take.

Now we go even further. Today's decision seems to say that all non-merits bases for dismissal are equal. Even without any kind of jurisdiction, a court can dump a case on forum non conveniens grounds. Presumably insufficient service of process would fall in the same category.

Probably there will now be years of wrangling about what constitutes a non-merits basis for dismissal. Lack of prosecution? Probably OK. How about laches, statute of limitations, or res judicata? I'm guessing those are merits bases, but who knows.

What a waste of time. If the plaintiff loses, the plaintiff loses. I can see the arguments against hypothetical jurisdiction (for example, courts can't act at all without jurisdiction; we have to guard the federal courts' limited jurisdiction; the plaintiff shouldn't be bound by a ruling on the merits if the court should have dismissed for want of jurisdiction; etc., etc.) but I find it difficult to get worked up about them. Expending time and resources in the name of doctrinal purity just seems wasteful. If the case has to be dismissed, let it be dismissed as soon as any reason for dismissal becomes apparent.

Amusingly, today's other case, Lance v. Coffman, turns on adherence to jurisdictional niceties!