- C.V. [Resume] of Carl Person
- Litigation Strategy - Preliminary
- How an Attorney's Litigation Experience Can Help the Client
- Importance of Complaints, Answers, Counterclaims
- Info: Trademarks, Franchises, Antitrust, Other
- Procedural Types of Actions
- State/Federal Court Differences
- See My Video Newspaper
- Admissions to Appellate Courts
- Bad Faith & Other Ins Litig
- Individual Practitioners Compete
- Types of Damages
- PACA Perish Agr Comm Act Litig
- Discussing Fees & Expenses
- Choosing between Litigation and Arbitration
- Useful Legal Doctrines
- Problems with a Little-Known Legal Solution
- Types/Place of Legal Svcs
- The Costs of the Most Expensive Litigation
- Estimated Costs of One 1st-Class Deposition
- Local Counsel Explained
- 3 Books by Carl Person
- Your In-House Counsel - Shared, Low-Cost, Parttime, No Withholding
- Emergency Second Circuit Appellate Filings, Forms C and D
- A Brief Description of Legal Matters Your Shared In-House Counsel Could Perform
- A TRAP: Pre-Negotiation Agr & Bkcy Defense Waivers
- Municipal Bond Relief
- Attorney Advertising Notice
Differences between Federal and State Courts
There are often good reasons to choose federal court over state court, or state court over federal court. Here are some of the considerations that lawyers and clients weigh when deciding one court over the other. The list is not all inclusive.
Two decisions by the U.S. Supreme Court have changed the world of litigation. The
Constitutional right to a jury trial was taken away many years ago by the U.S. Supreme
Court and all other federal and state courts that have held that judges have the right to
prevent a trial (by jury or non-jury) if the judge grants a "summary judgment" against a
party holding that "there are no issues of fact to be decided at trial". These summary
judgments are granted all too often, in my opinion, when in fact there are factual issues
raised by opposing counsel. The problem is complicated, political on one hand and a matter
of logistics on the other (with the court systems in the U.S. being unable to provide trials
for the millions of cases where factual issues need to be resolved, and instead of having cases
be backed up for 10-20 years waiting for trial the courts and judges resolve cases on more
practical grounds, with summary judgment being used to get rid of the case overload. Of course,
this is only my opinion after more than 50 years of litigation in both the federal and state courts -
but my type of litigation is commercial litigation - with a much higher risk of summary judgment
against the plaintiff (but not as much as against civil rights' plaintiffs). When cases are insured,
such as negligence, product liability, medical malpractice, the trials seem to be taking place
without the same percentage of summary judgments for defendants.
Having given you this insight as to getting rid of cases by summary judgment, let me tell you the newest technique for getting rid of cases that has been devised by the U.S. Supreme Court. The two decisions are Twombly (2007) and Iqbal (2009) which started in antitrust litigation and are now being used in virtually all types of federal case including Bankruptcy courts. The judges are able to dismiss a properly pleaded complaint or other pleading if the judge states in his decision something like "I don't think it's plausible for" General Motors to conspire with Ford Motor Company - why would they want to do anything like that? (or similar statement to fit the case at hand). In this way the case is dismissed and the plaintiff gets nothing, even though the Complaint is properly pleaded. This is much worse that the summary judgment doctrine explained in the preceding paragraph. And I it quite justified for attorneys and plaintiffs to take their case to the state courts where the Twombly and Iqbal cases are not yet being followed (but undoubtedly will be followed in the not so distant future, I do predict).
- Existence of Jurisdiction. Whether there is jurisdiction in
either or both of the courts. Federal jurisdiction requires either a federal
question and sometime a minimum dollar amount at issue or that there by
"diversity of citizenship" and a minimum dollar amount at issue. "Diversity
jurisdiction" requires that none of the plaintiffs come from any of the
state from which the defendants come (and there is a "double diversity test"
if a corporation is involved, with the corporation's state being both the
state of incorporation and the state in which the corporation has its
principal place of business. If there is federal jurisdiction, the court has
"supplemental jurisdiction" over any related "state issues". Also, if a partnership is involved,
the state of residence or organization of the partners is also to be considered when
deciding if there is the requisite diversity of citizenship.
Most of the issues of jurisdiction boil down to unfairness, that if a corporation is not doing a sufficient amount of business in the state the corporation should not be required to defend a lawsuit in that state, unless (of course) the corporation has an office in such state (in which case it is "doing business" in that state). A human being cannot be sued in a state unless there is jurisdiction over the human being, such as by the human being (or individual) having his/her residence in the state, or being "present" in the state while being served with a summons and complaint. Even if there is jurisdiction, a defendant (or perhaps a plaintiff) can move for a change of venue, for a variety of reasons. the plaintiffs have a basis for commencing the suit in the selected state, such as by the plaintiff's presence, or the defendant's presence or (in the case of a corporation) either incorporated in the state or doing business in the state, or having committed a wrong in the state (and there are various other tests to consider).
Jurisdiction is one of the first things that has to be considered. If there is no jurisdiction in a given state, the plaintiff would have to select a different state in which to bring suit, which might be disadvantageous to the plaintiff.
- Ease or Difficulty in Obtaining Discovery. The rules for obtaining discovery across state lines in an action brought in federal court are many times easier for a litigant than the discovery rules applicable to the state courts in various states, especially New York. To be able to take a deposition of an out-of-state non-party in a New York state-court action, it could take one year to obtain the necessary court orders and "commissions" or "letters rogatory" involved. In federal court, on the other hand, one could notice and serve a subpoena to take a non-resident individual's deposition (or "examination before trial" or "ebt") in one day. This is perhaps the most important difference and needs to be weighed against the risk of dismissal of a properly pleaded complaint under Twombly and Iqbal.
- The Quality or Expertise of the Judge. For years it was commonly understood (rightly or wrongly) that the judges on the federal bench were generally superior to the state judges. Without trying to take sides on that issue I will observe that some federal statutes require actions to be brought in federal court (such as for violations of the federal antitrust laws or for copyright infringement), and it is to be expected that federal judges with experience of this type will have a more developed skill for long and complicated cases than most state-court judges. The New York Supreme Court (the highest New York court with general or unlimited trial-court jurisdiction) has set up a commercial division in which a small group of state judges handle complicated commercial cases, and it is also to be expected that such judges would have a more developed expertise as to large commercial cases than other state judges, and perhaps a comparable or even greater skill as to such cases as a typical federal judge (many of whom are generalists, not specialized in the type of case they hear; federal judges usually hear any type of case, civil or criminal).
- Assignment of Case to a Single Judge. Federal court started the practice of assigning each new case, as filed, to a single judge, at random. Many or most states have done this as to their highest court of general trial-court jurisdiction. The advantage of the single-judge system is that the judge has responsibility for completing the case and doing so quickly, whereas when there is no single judge, each judge has more of a tendency to slough off things that need to be done because the case is not his/hers, and "let someone else do the dirty work of a particularly difficult case". However, in the single judge system a litigant will sooner or later get to a point in which the judge develops an insight or bias (whether justified or not) and this will tend to favor one party over another, rightly or wrongly. The main advantage to the single judge system is that the judge knows what the case is about and there is no need to bring a new judge up to speed each time a new motion or other issue arises. Thus, the individual assignment system is designed to conserve judicial resources, which also reduces the amount of work parties and their counsel need to undergo to educate a number of different judges on the case.
- Specific Decisions Applicable to All Judges in the Court. Lawyers will often determine that an important legal issue can be asserted in one jurisdiction but not in another, and decide to commence an action in the favorable jurisdiction. This happens, for example, when there is a split of opinion between two different federal Circuit Courts of Appeal or between two or more Appellate Divisions (such as in New York State). This is known to some as forum shopping, and is a higher level type of judge shopping.
- Loss of Right to Trial in State Court for Some Types of Pleadings. In New York, there is an ancient doctrine well and alive today that says that if a party alleges entitlement to an equitable remedy (such as injunctive relief or an accounting), this automatically waives what was otherwise the right to a jury trial. The reasoning is that equitable relief must be tried before a judge without a jury, and if you, as plaintiff, plead that you have an equitable claim, you are also pleading that you are to have that claim heard by a judge without jury, and all other claims would then have to be resolved by that judge - also without a jury. I think this is an outrageous outcome, but it is still the law, but only if you commence the action in the New York courts. If you commenced the same action in federal court in New York, no such rule exists and you would have the benefit of a non-jury trial as to the equitable relief and a jury trial (if properly demanded by one or more of the parties) as to the other relief (generally for monetary recovery).
- To Avoid the Possibility of Getting a Specific Judge. Some federal courts have 25-30 District Judges and others (at the other extreme) have only 1-2. If you want to avoid getting assigned one specific judge in a 2-judge district, you would then file the action in the state court.
- Desire for Speed or for Delay. Federal judges have reporting requirements that make them move their cases faster, on the average, than many state courts. If you are the plaintiff and want a fast resolution of the action, you probably would consider federal court, but if you want to drag your heels and have a slow lawsuit, you probably will be thinking about a state action. Most state judges have less reason to move a case along than a federal judge.
- Jury Pool. Federal court can and does draw from a larger area in many instances than the state courts located in the same city. This can result in different types of jurors, something which should be taken into consideration by plaintiffs seeking a jury trial.
- Location of the Competing Courts. Most of the time, the state court is closer to the office of the plaintiff's attorney, which often means that for the convenience of the plaintiff's attorney the state court will be selected (or the federal court, if closer). There is a significant advantage to the attorney to have an action commenced in the closer court, but this is only one factor and should not override all or most of the other factors.
- Need to Overturn a State-Court Decision. If you need to overturn a state court decision, such as a decision by the highest state court in your state, the best place to do this is in a state court, according to most lawyers, because a federal judge is supposed to be less inclined to overturn a state court decision than a state court judge.
- Mediation Opportunities. Some state courts have top flight mediation parts to which a plaintiff might like to go to try to settle the case after it has been commenced, in comparison to the opportunities for mediation in the federal courts. In federal court, almost any federal judge would permit the parties to take time off from activity before the judge to hire a mediator and see if the case can be resolved. Also, a federal judge could have mediation done by a federal Magistrate Judge. One thing to remember, however, is that when a judge participates in mediation he/she probably would not be able to continue as the single judge on the case because of the information the judge has heard ex parte (without the other side being present to try to offset). The same would probably be true about the Magistrate Judge. If your case is assigned to the assigned Magistrate Judge for mediation, you probably would lose that judge as your Magistrate Judge. Perhaps this in some cases is the reason that one party or another might consent to mediation, not to settle the case but to disqualify a Magistrate Judge who is not to the liking of one of the parties.
- Costs of Litigation Tend to Be More Expense in Federal Court. Costs tend to be higher in federal court because the attorneys are more specialized, the cases are generally of greater value, and the federal judges tend to require more of parties than a state court judge in a similar situation. More importantly, federal court enforces deadlines to a much greater extent than many state courts. For example, if an attorney fails to file opposition to a motion by a deadline (imposed by court order or federal rule), there is a much greater likelihood that the motion will be granted by default and that a belated opposition will be rejected. In state court (such as in New York) attorneys routinely file opposing papers late, often the night before (or even the day that) a motion is returnable, with the judges upon request by the moving party adjourning the return date to enable the moving party to read and respond to the belatedly-filed opposing papers. Thus, in federal court the attorney has to set everything else aside to ensure that a federal response is done in time, and can expect to put in a higher standard of work with appearances before the judge to be done by an attorney with a license to practice before the federal court - all at greater cost. State court litigation is less demanding and less costly, and attorneys are able to handle their work load more efficiently and with less cost.
- Federal Judge Tend to Dismiss Cases More So Than State-Court Judges. Federal judges have a known tendency of dismissing actions for technical reasons or for granting summary judgment against a plaintiff more so than state court judges would do under similar circumstances. This is one very good reason that a plaintiff should consider state court for the case. Yet, some of the cases have no option, because the jurisdiction is exclusively federal. Also, even if a plaintiff selects state court, a defendant has the opportunity within a few days to "remove" the action to the local federal court if the action could have been brought in the court. Recent federal legislation requires more class actions to be commenced initially in federal court, for the stated reason that federal judges are more apt to dismiss the case. Also, a federal judge is more apt to dismiss a complaint for failure to meet pleading requirements than a state court judge, although this may be comparing apples and oranges because the types of cases often differ substantially between a federal and nearby state court.
- Appeals Courts. A litigant should also consider the appeals court which would be involved. Some appellate courts are predictably going to go one way more than the corresponding state appellate court, and the plaintiff and his/her lawyer should take this into account.
- Other Factors To Be Sure. There are various other factors to take into consideration, but the foregoing are enough to get you started.
Last Revision: 10/26/16