Civil Procedure SMJ Questions Flashcards
Dennis was arrested at an anti-war rally. While the police officer was arresting Dennis, an altercation between the two broke out. Dennis claims that the police officer used excessive force in making the arrest. As a result of the arrest and altercation, Dennis incurred damages totaling $7,500 for medical expenses. Dennis filed suit against the police officer for violation of his federal constitutional rights in state court. The police officer filed a motion to dismiss for lack of subject matter jurisdiction.
How should the court rule?
(A) The court should grant the police officer’s motion to dismiss, as federal courts have exclusive jurisdiction over federal civil rights violations.
(B) The court should grant the police officer’s motion to dismiss, as federal courts have exclusive jurisdiction over questions based on constitutional rights.
(C) The court should deny the police officer’s motion to dismiss, as state and federal courts have concurrent jurisdiction over most federal questions, including this one.
(D) The court should deny the police officer’s motion to dismiss, but only if Dennis includes the state law claims for assault and battery.
C is correct. Generally, the state and federal courts have concurrent jurisdiction over federal question cases. In a few situations, federal statutes make federal jurisdiction exclusive over certain types of claims. In most situations, including a civil rights claim such as this one, state and federal courts have concurrent jurisdiction so the plaintiff can choose to file the case either in state court or federal court. Therefore, the state court has jurisdiction and the motion should be denied.
A and B are incorrect. Federal jurisdiction is not exclusive over federal questions or federal constitutional rights. There are certain types of cases within the federal court’s exclusive jurisdiction, such as patent rights or antitrust, but not constitutional right violations.
D is incorrect. Dennis need not have a state law based claim to authorize state court jurisdiction since state courts and federal courts have concurrent jurisdiction over these civil rights claims.
Plaintiff, from State A, sued Defendant, also from State A, in federal district court. Plaintiff alleged that Defendant caused damages in excess of $10,000,000 by violating Plaintiff’s patent rights on a new electronic tablet design and software. Defendant filed a motion to dismiss challenging the court’s subject-matter jurisdiction over the case.
How should the court rule?
(A) The court should grant the motion, because both parties are citizens of State A.
(B) The court should grant the motion, because the court lacks personal jurisdiction over Defendant.
(C) The court should deny the motion, because the federal court has jurisdiction over the case.
(D) The court should deny the motion, because the damages are well over $75,000.
C is correct. Federal Courts have exclusive jurisdiction over certain types of claims, including patent rights, securities, antitrust, and claims arising under the Federal Torts Claim Act. Exclusive jurisdiction is the federal court’s exclusive power to adjudicate the claims. Here, Plaintiff is alleging a violation of patent rights, which falls under the federal court’s exclusive jurisdiction.
A and D are incorrect because jurisdiction is not based on diversity jurisdiction. Diversity jurisdiction provides litigants an avenue to federal court where the adversaries are completely diverse in citizenship and the amount in controversy is reasonably likely to exceed $75,000. Here, the cause of action arises under federal law, one which is exclusive to the federal court’s jurisdiction, regardless of state of citizenship or amount in controversy.
B is incorrect because Defendant’s motion is not challenging the court’s personal jurisdiction over the person but rather the subject matter over the controversy. Subject matter jurisdiction is the court’s power over the controversy (here, patent rights violation), not the person (Defendant). Since the challenge is to the court’s power over the controversy and not over the defendant, this answer choice is non-responsive to the question and is, therefore, incorrect.
The plaintiff, a citizen of State A, files a claim in state court, alleging that the defendant, a Delaware corporation, violated her rights under the federal Civil Rights Act of 1964 and seeks damages in the amount of $50,000.
(A) Yes, because the parties are diverse.
(B) Yes, because the Civil Rights Act does not provide for exclusive federal court jurisdiction.
(C) No, because this claim arises under federal law.
(D) No, because the plaintiff is seeking only $50,000
B is correct. The question here is whether a state court would have subject matter jurisdiction over a federal statutory claim. State courts have concurrent jurisdiction with federal courts over claims arising under all federal statutes except those few that vest federal courts with exclusive jurisdiction. The Civil Rights Act is not one of those few statutes.
A is incorrect because diversity jurisdiction relates to the subject-matter jurisdiction of a federal court under § 1332, not a state court. State courts are courts of general jurisdiction.
C is incorrect because it does not go far enough. The fact that a claim arises under federal law does not always mean that the state court has subject-matter jurisdiction because some minority of federal statutes provide for exclusive jurisdiction in the federal courts.
D is incorrect because there is no amount in controversy requirement for federal claims.
An industrial accident injured Worker while he was using a machine for work. Worker was using the machine as intended while he was working for Shipping Co., incorporated in State A and with a principal place of business in State B. Worker worked in State B but was a citizen of State C. Worker was severely injured, requiring months of hospitalization and rehabilitation. After Worker recovered from his injuries, he filed suit in State C state court against his employer Shipping Co., alleging that the shift supervisor at Shipping Co. had intentionally placed the machine on a decline, causing the machine to tip over and pin Worker to the ground, because the supervisor was angry with Worker. Before filing its answer, Shipping Co. removed the case from state court to federal court in State C. Worker filed a motion to remand.
How should the court rule on the Worker’s motion?
(A) The court should grant the motion because the court lacks subject-matter jurisdiction over Worker’s claim.
(B) The court should grant the motion because cases arising under state law cannot be removed.
(C) The court should deny the motion because federal courts have exclusive jurisdiction over diversity suits under 28 U.S.C. §1332.
(D) The court should deny the motion because the federal district court has subject-matter jurisdiction over this case under §1332.
D is the correct answer. The elements of diversity jurisdiction under 28 U.S.C. §1332 are satisfied where the Worker is from State C, Shipping Co. is from States A and B, and with extended hospital and rehabilitation stays the amount in controversy is reasonably likely to exceed $75,000. Therefore, removal under §1441 is proper based on §1332. The exclusion found in 28 U.S.C. §1445(c) does not apply here because the Worker’s cause of action does not arise under the State’s workman’s compensation laws but rather a common law intentional tort claim, which would not be barred by the State’s workman’s compensation laws. Therefore, D is correct and Answer A is incorrect.
Answer B is incorrect because 28 U.S.C. §1332 grants federal courts authority over cases arising under state law when there is complete diversity of citizenship between the adverse parties and the damages are reasonably likely to exceed $75,000.
Answer C is incorrect because federal courts do not have exclusive jurisdiction over diversity cases. 28 U.S.C. §1332 grants federal courts authority over cases arising under state law when there is complete diversity of citizenship between the adverse parties and the damages are reasonably likely to exceed $75,000. However, this authority is not exclusive to the federal courts, but rather concurrent. The plaintiff may choose to file their case in state court, which is a court of general jurisdiction, or plaintiff may choose to file in federal court, which is a court of limited jurisdiction. If plaintiff files in state court, then the defendant may have the ability to remove the case to federal court under §1441 or remain in state court.
Damien was a student attending State A University. While at school, Damien lived in a dormitory on campus. During holidays and breaks, Damien returned to his hometown in State B. During his senior year in college, Damien decided to move to State A permanently so he began looking for an off-campus apartment. After graduating, Damien was recruited by a multi-national advertising firm based in State C. Damien was recruited to head up their State D office. While traveling through State A to State D to begin searching for an apartment, Damien was in a car accident which required a six month stay at a local State A hospital.
Plaintiff wants to file a diversity action against Damien. Where is Damien domiciled?
(A) State A.
(B) State D, where Damien is planning on living and working after his release from the hospital.
(C) State B, where he lived prior to attending college.
(D) State C, where his current employer is incorporated and has its principal place of business.
A is correct because Damien was present in State A, and during his senior year he developed the subjective intent to remain in State A indefinitely. Because Damien will not lose his domicile until he fully gains a new one, Damien remains domiciled in State A.
B is incorrect because Damien was never present in State D, so he could not have established his domicile there.
C is incorrect because at the moment Damien was present in State A with the intent to stay there indefinitely, he established a new domicile in State A and lost his previous domicile in State B.
D is incorrect because Damien is an individual. This answer lists the rules for corporate citizenship, which will not apply to Damien.
Passenger, a citizen of State L, was riding in a car driven by his friend Driver, a citizen of State T. They crashed into a car driven by Plaintiff, a State T citizen. Plaintiff and Passenger filed an action in federal court in State T in which each of the plaintiffs asserted a $100,000 tort action against Driver.
Driver filed a motion to dismiss for lack of subject-matter jurisdiction, which the court granted.
Did the court err in granting the motion?
(A) Yes, because jurisdiction is proper under diversity jurisdiction.
(B) No, because Driver and Plaintiff are both citizens of State T.
(C) Yes, because each claim is for more than $75,000.
(D) No, because the action was filed in State T.
B is correct. The presence of one non-diverse plaintiff (here, Plaintiff) destroys the complete diversity required by 28 U.S.C. §1332. Thus, the lack of diversity between Plaintiff and Driver precludes Passenger from using diversity jurisdiction as the basis for exercising original jurisdiction over any claim in the case. Thus, the court must dismiss both claims.
A is incorrect. With no original jurisdiction over either claim (this being state law claims lacking proper diversity jurisdiction), there is no claim upon which to “anchor” the claims in exercising supplemental jurisdiction. So even though the claim by Passenger against Driver would have met the requirements of diversity jurisdiction under §1332 had it been brought by itself, the claim by the non-diverse Plaintiff prevents the court from exercising supplemental jurisdiction.
C is incorrect. In order to properly assert federal subject matter jurisdiction based on diversity, the Plaintiff must satisfy both the diversity requirement and the amount-in-controversy requirement. Here, the fact that both claims exceed the amount in controversy requirement is irrelevant since Plaintiff and Driver are not completely diverse in citizenship.
D is incorrect. The fact that the action was filed in State T is irrelevant.
Plaintiff and Defendant were married in State A, where both their children were also born. Thereafter, Plaintiff moved to State B, where he was employed. After 15 years of marriage and accumulating significant marital assets totaling $10 million, the couple decided to divorce. Plaintiff filed for divorce in federal district court in State B, seeking joint custody of the children and a court order splitting the marital estate equally to each spouse.
Defendant moved to dismiss the divorce action. How should the court rule on her motion?
(A) The district court should deny the motion, because diversity jurisdiction is satisfied where Plaintiff and Defendant are now citizens of different states and the marital estate is worth $10,000,000.
(B) The district court should remand the divorce action to a State B state court, because the federal court lacks federal subject matter jurisdiction.
(C) The district court should transfer the divorce action to a State B probate and family court.
(D) The district court should grant the motion.
D is correct because even if diversity jurisdiction is present because federal courts will decline exercising such power when the lawsuit pertains to divorce and child custody. Generally, a federal court is required to exercise subject matter jurisdiction over a state law claim if the individual parties are citizens of different states and the amount in controversy is satisfied. However, the Supreme Court of the United States has recognized an exception in diversity actions for suits involving domestic relations. The exception covers divorce actions, alimony, and child custody cases, but does not include suits for torts. Here, Plaintiff seeks a divorce and child custody, and the district court should exercise its discretion and decline to exercise diversity jurisdiction even though diversity jurisdiction is present.
A is incorrect because the Court has recognized the doctrine of abstention which allows a federal district court to decline to exercise federal jurisdiction in a diversity action that involves divorce, alimony, or child custody. Therefore, even if diversity jurisdiction is present, the court will grant the motion.
B is incorrect because it incorrectly states that a federal court can remand an action when a party moves to dismiss the action for lack of subject matter jurisdiction. Remand is the process whereby the federal court transfers an action back to state court when defendant has improperly removed an action from state court to federal court. There was no such removal here as the case was originally filed in federal court.
C is incorrect because transfer is permitted only between federal judicial districts, not federal to state as this answer choice suggests. While the district court will exercise its discretion and decline to exercise diversity jurisdiction in a suit that pertains to divorce, alimony, or child custody, the proper course would be to dismiss the action and allow the parties to file it in the appropriate state court. A federal court does not have power to transfer a federal lawsuit to a court in a state court system, even if it is the same state in which the federal court sits
Plaintiff filed suit in federal district court after the Defendant refused to perform under a signed contract. The contract was for the sale of real estate worth $75,000. In fact, not only did the Defendant refuse but the day after signing the contract with Plaintiff, the Defendant sold the land to a bona fide purchaser.
Plaintiff is a citizen of State M and Defendant is a citizen of State C. After suit was filed, Defendant filed a motion to dismiss based on lack of subject-matter jurisdiction.
How should the court rule?
(A) The district court should grant the motion, because the court lacks subject-matter jurisdiction over the controversy.
(B) The district court should grant the motion, because the federal court does not have jurisdiction over state law contract claims.
(C) The district court should deny the motion, because the court has jurisdiction over the claim based on diversity jurisdiction.
(D) The district court should deny the motion, because the parties stipulated in the signed contract that the federal district court will resolve all disputes arising from performance or non-performance of the contract.
A is correct. Federal courts have subject matter jurisdiction over violations of federal law, constitutional rights violations, and state law claims under diversity jurisdiction. Diversity jurisdiction requires that there is complete diversity of citizenship between plaintiff and defendant and the claim is reasonably likely to exceed $75,000. Here, the real estate was worth exactly $75,000 and there is no indication that the Plaintiff has damages above the worth of the land. Since the claim is for exactly $75,000, it is not reasonably likely to exceed $75,000; therefore, diversity jurisdiction is not satisfied.
B is incorrect because federal courts may exercise subject matter jurisdiction over state law claims if the litigants can satisfy the requirements for diversity jurisdiction, which they have not done so here.
C is incorrect for the reasons stated in A.
D is incorrect because subject matter jurisdiction cannot be conferred by consent or waiver. The court must have proper subject matter jurisdiction in order to render a valid judgment. Since the court here did not have subject matter jurisdiction, the only proper ruling is to grant the motion to dismiss.
Plaintiff from State A and Defendant from State B were involved in a multi-vehicle crash on a busy State B highway. After all necessary medical treatments had been completed, Plaintiff filed a lawsuit in federal district court in State B based on diversity jurisdiction. Unbeknownst to the Plaintiff, after the accident but prior to the filing of the lawsuit, Defendant moved to State A. After the suit was filed, Defendant filed a motion to dismiss for lack of personal jurisdiction. Two days after the trial began, the Defendant filed another motion to dismiss for lack of subject-matter jurisdiction.
How should the court rule on the second motion to dismiss?
(A) The court should deny the motion.
(B) The court should deny thet motion as untimely.
(C) The court should grant the motion unless the defendant consents to federal subject-matter jurisdiction.
(D) The court should grant the motion to dismiss for lack of subject-matter jurisdiction.
D is the correct answer. The motion to dismiss for lack of subject-matter jurisdiction, under FRCP 12(h)(3), the lack of subject-matter jurisdiction cannot be waived and may be asserted at any time. When assessing whether a court has subject-matter jurisdiction based on diversity jurisdiction, the relevant time for citizenship is at the time of filing. Here, the Plaintiff was, at all relevant times, domiciled in State A. Defendant was from State B at the time the accident took place but moved to State A before suit was filed. Therefore, the court should grant the motion to dismiss for lack of subject-matter jurisdiction.
Plaintiff, a citizen of State A, filed suit against Defendant, a State B corporation, in State A state court, alleging breach of contract. Liquidated damages had been stipulated to be in excess of $75,000. The Defendant removed the case to federal district court in State A, based on diversity jurisdiction. Following a lengthy trial, a jury verdict was entered in favor of the Defendant. Plaintiff appealed the judgment, arguing various evidentiary errors made by the judge during the trial. However, while the appeal was pending fifteen months after the trial court entered judgment for the Defendant, the Plaintiff discovered that the Defendant’s principal place of business was in State A at the time the lawsuit was filed. Plaintiff then argued on appeal to vacate the judgment on the basis that the federal court lacked subject-matter jurisdiction and thus lacked the power to render a valid judgment.
How should the court rule on the jurisdictional issue on appeal?
(A) The appellate court should uphold the judgment because the Plaintiff failed to raise the jurisdictional defense when Defendant removed the case to federal court.
(B) The appellate court should uphold the judgment because more than a year has passed since the court entered judgment in the case.
(C) The appellate court should reverse the judgment because, by failing to raise this at the trial level, the Defendant perpetrated a fraud upon the court.
(D) The appellate court should reverse the judgment because the trial court lacked subject-matter jurisdiction and thus could not render a valid judgment in this case.
D is the correct answer. Subject matter jurisdiction is the court’s power over the controversy itself and provides the court with the power to render a judgment in the case. If the court lacks subject-matter jurisdiction, then any judgment it renders is void. Because of the importance of subject matter jurisdiction, the challenges to subject matter jurisdiction cannot be waived, it cannot be conferred by consent, and the court can raise a lack of subject matter jurisdiction sua sponte (on its own). Pursuant to FRCP 12(h)(3), if the court determines at any time that it lacks subject-matter jurisdiction, the court must dismiss the action, even when raised for the first time on appeal. Here, even though the discovery was made 15 months after entry of judgment, the judgment is void.
Answer A is incorrect because the lack of subject matter jurisdiction can be raised by either party, or even the court, at any time—even for the first time on appeal.
Answer B is incorrect because it is suggesting that the lack of subject matter jurisdiction must be raised within a year of entry of judgment. A judgment entered by a court that lacks subject matter jurisdiction is void, and jurisdictional issues can be raised at any time while the litigation is ongoing, even years after the original trial while the case is on appeal.
Answer C is incorrect because there are no facts to suggest that the Defendant was perpetrating a fraud upon the court.
Plaintiff, a citizen of State A, filed suit in federal district court against Defendant, a citizen of State B, alleging one count of negligence resulting from a car accident, and one count for breach of contract resulting from an agreement the parties entered into a year prior to their accident. Plaintiff alleged damages to his car and person in the amount of $50,000. The contract called for liquidated damages in the amount of $35,000.
Defendant filed a motion to dismiss challenging the court’s subject-matter jurisdiction over the controversy. How should the court rule?
(A) The court should grant Defendant’s motion, because Defendant is not from State A.
(B) The court should grant the motion, because Plaintiff cannot aggregate damages from two unrelated claims in order to satisfy the amount-in-controversy requirement for diversity jurisdiction.
(C) The court should deny the motion, because Plaintiff can aggregate damages from two unrelated claims in order to satisfy the amount-in-controversy requirement for diversity jurisdiction.
(D) The court should deny the motion, because Plaintiff and Defendant are from different states, thereby satisfying the complete diversity of citizenship required for subject-matter jurisdiction.
C is correct. Federal courts have subject matter jurisdiction over state law claims where the adverse parties are diverse in citizenship (meaning no plaintiff is from the same state as any defendant) and the controversy is reasonably likely to exceed $75,000. In order to satisfy the threshold amount, aggregation of damages is permitted in unrelated cases between the same parties.
A is incorrect because Defendant is not challenging the court’s jurisdiction over the person but rather the controversy. Subject matter jurisdiction is the court’s power over the controversy (here, through diversity jurisdiction), not the person (Defendant). Since the challenge is to the court’s power over the controversy and not over Defendant, this answer choice is non-responsive to the question and is, therefore, incorrect.
B is incorrect because the answer misstates the law. Federal courts have subject matter jurisdiction over state law claims where the adverse parties are diverse in citizenship (meaning no plaintiff is from the same state as any defendant) and the controversy is reasonably likely to exceed $75,000. In order to satisfy the threshold amount, aggregation of damages is permitted in unrelated cases between the same parties. Therefore, this answer choice is incorrect.
D is incorrect because it is an incomplete response. Federal courts have subject matter jurisdiction over state law claims where the adverse parties are diverse in citizenship (meaning no plaintiff is from the same state as any defendant) and the controversy is reasonably likely to exceed $75,000. In order to exercise proper diversity jurisdiction, both requirements must be satisfied. Answer choice D suggests that complete diversity of citizenship alone is enough for federal subject matter jurisdiction, which is incorrect.
Plaintiff, a citizen of State X, filed suit against her neighbor, also a citizen of State X, for damages to her new car resulting from an accident on their shared driveway. The neighbor had also caused significant damage to Plaintiff’s fence, garage, and prized rose bushes. After failed attempts to settle their dispute, Plaintiff filed suit in federal district court in State X alleging damages against the neighbor exceeding $75,000. The neighbor filed a motion to dismiss for lack of subject-matter jurisdiction.
How should the court rule?
(A) The court should deny the neighbor’s motion, because the federal district court has exclusive jurisdiction over claims that exceed $75,000.
(B) The court should grant the motion, because Plaintiff cannot aggregate the damages to the car, fence, garage, and rose bushes in order to meet the jurisdictional threshold for diversity jurisdiction.
(C) The court should deny the motion, because the plaintiff is the master of her complaint and can choose which court she wishes to hear her case.
(D) The court should grant the motion, because Plaintiff has not met the requirements for diversity jurisdiction.
D is correct. Federal courts have subject matter jurisdiction over state law claims where the adverse parties are diverse in citizenship (meaning no plaintiff is from the same state as any defendant) and the amount in controversy is reasonably likely to exceed $75,000. Here, Plaintiff has a state law claim of negligence against her neighbor. In order to assert proper federal jurisdiction, Plaintiff would have to satisfy both prongs. While the damages are reasonably likely to exceed $75,000, the parties are neighbors, meaning that they are citizen of the same state. Therefore, complete diversity of citizenship is lacking.
A is incorrect because there is no requirement that claims exceeding $75,000 be adjudicated in federal court. Federal courts have exclusive jurisdiction over claims arising under certain federal statutes such as antitrust claims, patent violations, bankruptcy claims, etc.
B is incorrect because aggregation of damages resulting from the same cause of action is permitted. Federal courts have subject matter jurisdiction over state law claims where the adverse parties are diverse in citizenship (meaning no plaintiff is from the same state as any defendant) and the controversy is reasonably likely to exceed $75,000. Here, Plaintiff has a state law claim of negligence against her neighbor where Defendant’s conduct caused damages to Plaintiff’s property. Plaintiff is permitted, (and in fact required to or else waives her rights), to assert all damages and claims against Defendant in a single action.
C is incorrect because, although the plaintiff is the master of the complaint and can in fact choose which court to file the claim, the chosen court must have proper jurisdiction over the claim in order to render a valid judgment. Here, Plaintiff chose to file her claim in federal court. In order for the court to have power to adjudicate the claim, it must fall under a claim of federal/constitutional law violation or a state law claim under diversity jurisdiction. As this is a state law claim that does not meet diversity jurisdiction requirements, the court must dismiss for lack of subject matter jurisdiction.
Plaintiff, a citizen of State X, filed suit in federal district court against Defendant Car Co., incorporated in State Y with its principal place of business in State X. Plaintiff alleges that a defect in the manufacturing of her car by Defendant caused her accident, where she incurred property damage and severe bodily injuries. Due to the severity of her injuries, Plaintiff alleges that her medical expenses alone exceed $1,000,000.
After filing suit in federal district court in State Z, Defendant filed a motion to dismiss for lack of personal jurisdiction. The court denied the motion, so Defendant filed its answer to Plaintiff’s complaint, denying any liability for Plaintiff’s losses. A month thereafter, Defendant filed a motion to dismiss for lack of subject-matter jurisdiction. Plaintiff opposed the motion, arguing that Defendant waived its right to object to the court’s power when it failed to assert it with its previous motion.
How should the court rule on Defendant’s second motion to dismiss?
(A) The district court should deny Defendant’s motion, because Defendant waived its right to object to the court’s power when it unreasonably delayed in asserting this defense.
(B) The district court should grant Defendant’s motion.
(C) The district court should deny Defendant’s motion on grounds other than waiver.
(D) The district court should grant Defendant’s motion because this case was improperly removed.
B is correct. Federal courts have subject matter jurisdiction over state law claims where the adverse parties are diverse in citizenship (meaning no plaintiff is from the same state as any defendant) and the controversy is reasonably likely to exceed $75,000. Individuals are citizens in the state where they are domiciled, meaning where their true, fixed, and permanent place of residence is located. Corporations have dual citizenship — their state of incorporation and where their principal place of business is located. Here, Plaintiff is a citizen of State X. Defendant Car Co. has its principal place of business in State X. Since both Plaintiff and Defendant are from the same state, there is no diversity of citizenship. Therefore, the federal court lacks the power to adjudicate this controversy and it must dismiss.
A is incorrect because the lack of subject matter jurisdiction cannot be waived. One of the fundamental principles in civil procedure is the court’s power over the controversy. Subject matter jurisdiction, the court’s power over the controversy, can never be waived. The lack of the court’s subject matter jurisdiction can be asserted at any stage of the litigation, even for the first time on appeal. Rule 12(g)(2) requires parties to consolidate and bring forth as many defenses and objections the party has available or else they are waived, except for the lack of subject matter jurisdiction found in FRCP 12 (h)(3)
C is incorrect because it misstates Car Co.’s citizenship. For purposes of diversity jurisdiction, individuals are citizens in the state where they are domiciled, meaning where their true, fixed, and permanent place of residence is located. Corporations have dual citizenship — their state of incorporation and where their principal place of business is located. Here, Car Co. is incorporated in State Y and has its principal place of business in State X. Thus, at all times, Car Co. is a citizen of both states, destroying diversity of citizenship.
D is incorrect because an error in ruling on one motion does not give the court the power to “make up” for the error by incorrectly ruling on another motion. If the court erred in ruling on the first motion, the party against whom the court ruled can take up the matter on appeal at the appropriate time.
Plaintiffs, a husband and wife, were traveling in their home state of A when Defendant, from State Z, crashed into Plaintiffs’ pick-up truck, causing the truck to spin out of control and into oncoming traffic. Both plaintiffs suffered significant personal injuries, requiring long-term hospital stays and rehabilitation.
A year after the accident, Plaintiffs filed suit against Defendant in federal district court in State Z based on diversity jurisdiction, each plaintiff alleging damages exceeding $250,000. A week later, Plaintiffs decided to permanently move to State Z — they sold their home in State A and purchased a new home in State Z. Plaintiffs also both sought employment in State Z.
During discovery, Defendant learned of Plaintiffs’ move and filed a motion to dismiss for lack of subject matter jurisdiction.
How should the court rule?
(A) The court should grant the motion, because by moving to State Z, Plaintiffs destroyed diversity of citizenship.
(B) The court should grant the motion, because Plaintiffs cannot prove with certainty that their damages are $250,000 each.
(C) The court should deny the motion, because the parties have already conducted discovery and dismissing the case at this stage would cause undue hardship to Plaintiffs.
(D) The court should deny the motion, because the court has proper subject-matter jurisdiction over this claim.
D is correct. Federal courts have subject matter jurisdiction over state law claims where the adverse parties are diverse in citizenship (meaning no plaintiff is from the same state as any defendant) and the controversy is reasonably likely to exceed $75,000. Individuals are citizens in the state where they are domiciled, meaning where their true, fixed, and permanent place of residence is located. For purposes of diversity jurisdiction, citizenship is determined at the time of filing and diversity of citizenship need not continue after filing. Here, at the time of filing, Plaintiffs were citizens of State A and Defendant was a citizen of State Z, thus complete diversity existed. The fact that Plaintiffs moved a week after filing the suit does not affect the court’s jurisdiction, as diversity need not continue after the suit is filed.
A is incorrect. As noted above, for purposes of diversity jurisdiction, citizenship is determined at the time of filing and diversity of citizenship need not continue after filing. Here, at the time of filing, Plaintiffs were citizens of State A and Defendant was a citizen of State Z, thus complete diversity existed. The fact that Plaintiffs moved a week after filing the suit does not affect the court’s jurisdiction, as diversity need not continue after the suit is filed.
B is incorrect. For diversity jurisdiction, plaintiffs only need a good faith basis for alleging damages that are reasonably likely to exceed $75,000. Considering the extent of their injuries and medical expenses, Plaintiffs have met their burden of alleging in good faith that their damages will meet the amount-in-controversy requirement.
C is incorrect. Lack of subject matter jurisdiction cannot be waived. One of the fundamental principles in civil procedure is the court’s power over the controversy. Subject matter jurisdiction, the court’s power over the controversy, can never be waived. The lack of the court’s subject matter jurisdiction can be asserted at any stage of the litigation, even for the first time on appeal. See FRCP 12(h).
The plaintiff, a citizen of State A, files a claim in federal district court, alleging that the defendant, a Delaware corporation, violated her rights under the federal Civil Rights Act of 1964 and seeks damages in the amount of $50,000.
Does the court have subject-matter jurisdiction?
(A) No, because the plaintiff is seeking only $50,000.
(B) No, because the claim does not arise under federal law.
(C) Yes, because the parties are diverse.
(D) Yes, because the claim arises under federal law.
D is correct. The plaintiff’s case arises under the federal statute, giving the federal court subject matter jurisdiction regardless of the amount in controversy. Unlike diversity cases, there is no jurisdictional amount in controversy requirement for federal question cases under §1331.
A is incorrect. Unlike diversity cases, there is no jurisdictional amount in controversy requirement for federal question cases under §1331. The plaintiff only needs to allege some damages.
C is incorrect. The fact that the parties are diverse does not, itself, provide a basis for jurisdiction. Section 1332 also requires an amount in controversy in excess of $75,000, which is not present here.
B is incorrect. The case clearly arises under federal law because the plaintiff’s cause of action arises under the Civil Rights Act of 1964, which is a federal law.
