Hypothetical: Dixie (D) is an up-and-coming musician. She is a citizen of Tennessee. D has been in the music business for only six months, making her own CDs off of her computer; prior to that she was a hairdresser who had never traveled outside of Tennessee. Perfect Music Producing Company (P) saw D perform at a local bar in Tennessee and approached her to see if she was interested in selling her music CDs through their company. P is incorporated in Tennessee and headquartered in California. P paid for D to fly out to California for the contract negotiations at P’s headquarters. D signed a contract with P while she was in California and then flew back to her home in Tennessee.
Per this contract, D shipped her CDs from Tennessee to P’s warehouse located in California. D, on her own, also stamped the CDs with P’s trademark. P subsequently discovered that the CDs were damaged and sues D for two claims, seeking $300,000 in damages: (1) a violation of federal trademark law for stamping the CDs without P’s approval; and (2) a breach of contract claiming that D delivered bad goods. D claims the CDs were damaged while in P’s warehouse.
Question #1 (5 points): D files a Rule 12(b)(1) Motion to Dismiss the case for lack of Subject Matter Jurisdiction. How should the Court rule on this motion (is federal court proper)? In answering this question, using IRAC form, specifically address the following:
(1) Analyze whether there is a federal question under 28 U.S.C. § 1331 raised in P’s claim against D.
(2) Analyze whether there is diversity jurisdiction over P’s breach of contract claim against D under 28 U.S.C. § 1332. If not, analyze whether there is supplemental jurisdiction under 28 U.S.C. § 1367(c).
• Assume P’s state law breach of contract claim is well established under California law and does not raise any complex issues.
Question #2 (5 points): In which states can P sue D (where is D subject to personal jurisdiction)? In answering this question, using IRAC form, specifically address the following:
(1) Analyze whether California has specific personal jurisdiction over D.
(2) Analyze what state has traditional general jurisdiction over D.
