Civil Procedure

Prof. Rhonda Wasserman

Exam from Spring 2005

CIVIL PROCEDURE
SECTION C

Final Examination                                                                                                     Three and ½ Hours
April 27, 2005                                                                                                        1:00 PM - 4:30 PM

This is an open-book exam. The exam consists of ten (10) multiple choice questions and two (2) essay questions. One of the essay questions has sub-parts. Suggested time limits, which reflect the relative weight of each question (or group of questions, in the case of the multiple choice questions), are indicated at the beginning of each question or group of questions. Although the exam is three and one half hours long, the suggested time limits total three hours. You should use the remaining half hour to read through the essay portion of the exam before you start writing. You should apportion your time carefully.

This exam has thirteen (13) pages. If you do not have all thirteen pages, please inform the proctor immediately.

Please write your exam number in the space provided in the upper right-hand corner of each page of the exam and be sure to return the exam, together with any scrap paper used, to the proctor at the conclusion of the exam. Please be sure to include your exam number in the appropriate space on the Scantron answer sheet for the multiple choice questions and on the cover of each bluebook that you use to answer the essay questions. If you use more than one bluebook, please number your blue books (e.g., "1 of 3," "2 of 3," and "3 of 3"). When answering the essay questions, please write legibly and on every other line and on only one side of each page.

When answering the multiple choice questions on the Scantron answer sheet, please use a No. 2 pencil to facilitate the machine-grading of your answers. Each of the multiple choice questions will be weighted equally. Unless otherwise indicated, the facts of each multiple choice question stand on their own. Choose the best answer.

When answering the essay questions, please raise, discuss, and decide all issues presented, whether or not they are dispositive, and whether or not your resolution of one issue in a problem makes discussion of other issues in the same problem technically unnecessary. If you need to assume additional facts, please state what those facts are and how they affect your analysis.

If a rule of procedure, statute, or constitutional provision is relevant, you should refer to it specifically. You are encouraged to refer to other relevant authority, including cases. You should explain fully the relevance of all authority cited. Unless otherwise indicated in the exam question, all references to a "Rule" or the "Rules" are to the Federal Rules of Civil Procedure.

Best of luck, and enjoy the summer!

In April 2005, Harold and Maude, citizens of Pennsylvania, went to Chicago, Illinois, for a short vacation. They decided to do a host of "touristy" things: they went to the top of the Sears Tower, toured the Art Institute, and saw the comedy troupe, Second City. The highlight of their trip, though, was a professional baseball game: the Chicago Cubs home opener (against the Milwaukee Brewers) in Wrigley Field! The stadium was jam-packed, the crowd was rowdy and the beer was flowing. Harold and Maude were seated in the back row of the reserved section. The game was tied after the bottom of the ninth and, as the game went into extra innings, the crowd grew even rowdier (and drunker). Three inebriated young men were seated next to Harold and Maude. Harold and Maude were amazed by the amount of alcohol consumed by these men. In just the last two innings of the game, Harold and Maude noticed that each of these young men was served four or five additional beers, even though they already seemed drunk before the "seventh inning stretch."^* In the tenth inning, these men rose to their feet, climbed over their seats into the aisle behind Harold and Maude’s row, and started chanting and banging on the backs of the seats. Horseplay turned to disaster when one drunk young man, Butch, who was banging on the seats with particular vigor, somehow managed to fall over the back of the seat and land right on top of Maude. The sudden force of Butch’s considerable weight caused Maude’s shoulder to break. Harold and Maude left the game in an ambulance and went directly to the local hospital. An emergency room doctor set Maude’s shoulder and informed her that even after it healed, she likely would develop arthritis in the shoulder and never would resume the full range of motion.

For purposes of this exam, please assume that the Chicago Cubs ("CC") is an Illinois corporation with its principal place of business in Chicago, Illinois. CC derives income not only through ticket sales and broadcast rights, but also through the sale of souvenirs, food and beverages (especially beer). Patrons may purchase food and beverages at the game in two ways: they may purchase items from booths on the lower level of the stadium and/or they may purchase items from individuals who sell to patrons in the stands. The booths are operated by CC employees. The individuals who sell food and drinks in the stands are employees of Beerco, Inc., a Delaware corporation with its principal place of business in Chicago. Beerco and CC are parties to a contract, pursuant to which CC granted Beerco the right to sell specified foods and drinks, including beer, to patrons in the stands and Beerco agreed to pay CC a fixed percentage of the gross sales. In the contract, Beerco further agreed to indemnify CC from any and all liability that might result from the acts or omissions of its employees in the stadium.

Maude has decided not to sue Butch because she assumes that he is judgment-proof. Instead, Maude has decided to sue CC in the United States District Court for the Northern District of Illinois. Maude’s complaint alleges that CC is liable under the Illinois dram shop statute, which holds a bar (or any other business entity that serves alcohol) liable for the conduct of a patron toward a third party if the bar or other business entity continued to serve alcohol to the patron after it knew, or should have known, that the patron was intoxicated. The complaint seeks damages in excess of $75,000, exclusive of costs and interest. Please assume that the district court would have original subject matter jurisdiction to adjudicate Maude’s claim against CC (if sued upon alone). In its answer to the complaint, CC intends to deny the material allegations in the complaint. In particular, CC intends to deny that it served any alcohol to Butch (on the theory that only Beerco served him) and further deny that the server knew or should have known that Butch was already drunk. CC realizes the possibility that it may be held liable under the Illinois dram shop act even if a Beerco employee actually served Butch.

A.  CC believes that Maude really should be suing Beerco or Butch and in fact thinks the lawsuit should be dismissed in their absence. Which Rule or Rules might CC invoke to raise this argument? Is the argument likely to succeed? Why or why not? Please explain your answer fully.

B.  Do the Rules permit CC to join its own claim against Beerco in the context of Maude’s suit against it? Does the theory of liability matter? Which Rule in particular is implicated? What consequences, if any, will CC suffer if it does not join its claim against Beerco in the context of Maude’s suit against it? Please explain your answer fully. (For purposes of Question 1(B), please do not concern yourself with the availability of subject matter jurisdiction over CC’s claim.)

C.  Would the United States District Court for the Northern District of Illinois have subject matter jurisdiction to hear CC’s claim against Beerco described in Question 1(B) above? Why or why not? Please explain your answer fully.

For purposes of Question Two only, please assume that CC made no effort to join Beerco or Butch as parties to Maude’s federal lawsuit. Instead, assume that Maude sued CC, alleging liability under the Illinois dram shop statute. At the conclusion of the trial, the judge charged the jury in relevant part as follows: "Under governing law, a business entity may be held liable for an accident caused by a patron of the business only if two conditions are met: first, the server who served alcohol to the patron knew or should have known that the patron was already intoxicated; and second, the server was an employee of the business entity." The jury returned a general verdict for the defendant CC. The judge entered judgment on the jury verdict and neither party appealed.

Several months after the judgment was rendered, Maude filed a second suit, this one against both Beerco and CC in the United States District Court for the Northern District of Illinois. Maude alleges that (1) Beerco is liable under the Illinois dram shop act because it served Butch when it knew or should have known that Butch was already intoxicated; and (2) CC is liable under Illinois common law because it was negligent in contracting with Beerco given Beerco’s history of violating the dram shop statute. The complaint further alleges that CC’s negligence was a proximate cause of Maude’s injuries. Assume that the court has subject matter jurisdiction and that venue is proper. Can any of the parties take advantage of the judgment rendered in the first suit? Why or why not? How?

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