Subject Matter Jurisdiction- Diversity

Question 1

SMJ is about the court’s power over…

Answer 1

the case.

Question 2

As a general rule, state courts can hear what kind of cases?

Answer 2

Any kind of case. They have general subject matter jurisdiction.

Question 3

A few certain types of cases under federal law must be brought in…

Answer 3

federal court–e.g., patent infringement, bankruptcy, some fed- eral securities and antitrust claims.

Question 4

Federal courts have “limited” SMJ. What are the two main types of cases that can be heard in federal court?

Answer 4

Federal question and diversity cases.

Question 5

What are the two requirements for diversity of citizenship cases?

Answer 5

1. The case is either (a) between citizens of different U.S. states (diversity) or (b) between a citizen of a U.S. state and a citizen of a foreign country (alien- age) and
2. The amount in controversy exceeds $75,000.

Question 6

A subset of diversity of citizenship is…

Answer 6

alienage jurisdiction.

Question 7

Parties (can/cannot) consent to subject matter jurisdiction.

Answer 7

cannot

Question 8

What is the complete diversity rule?

Answer 8

No jurisdiction under diversity if any plaintiff is a citizen of the same state as any defendant.

Question 9

For alienage cases, it doesn’t matter…

Answer 9

whether the citizen is the plaintiff or a defendant.

Question 10

Cases between citizens of two different non-US countries can be heard in…

Answer 10

US state courts.

Question 11

Non-US citizens who are permanent residents of the US are never…

Answer 11

citizens of that state. (might be able to get alienage though)

Question 12

BUT, if the case involves an alien who is a permanent resident of the same state as an opposing party…

Answer 12

no diversity jurisdiction.

Question 13

If a party is a US citizen domiciled outside of the US, there is…

Answer 13

no diversity or alienage.

Question 14

For a human, who is a U.S. citizen, what is the U.S. state of her citizenship?

Answer 14

The state where she is domiciled.

Question 15

Everyone in the world has a domicile, which is…

Answer 15

retained until legally changed.

Question 16

A person cannot have more than one..

Answer 16

domicile at a time.

Question 17

How do you establish a new domicile?

Answer 17

1. Presence in the new place,
2. with intent to remain indefinitely.

Question 18

For intent, courts look to all relevant factors, like…

Answer 18

taking a job, buying a house, joining civic organizations, registering to vote, qualifying for in-state tuition.

Question 19

P (OH) decides to move permanently to GA. She accepts a job in GA and tells everyone that she intends to live the rest of her life in GA. While driving to GA, she is involved in an auto collision in KY. She is hospitalized in KY. If she sued now, what is P’s citizenship?

Answer 19

Ohio; she never established presence in GA.

Question 20

Treat __ as a state.

Answer 20

DC (and other territories)

Question 21

Diversity is tested for validity when…

Answer 21

the case is filed.

i.e. the parties need not be diverse when the underlying event occurred.

Question 22

What is the citizenship of a corporation?

Answer 22

1. Every US state or country where it is incorporated; and
2. the one US state or country of its principal place of business.

Question 23

The PPB is usually the site of…

Answer 23

the corporate headquarters.

Question 24

Where is the principal place of business?

Answer 24

Where the managers direct, coordinate and control corporate activities.

Question 25

What is the citizenship of an unincorporated association?

(e.g. partnership, limited liability company, etc…)

Answer 25

look to the citizenship of all its members.

e.g. if an LLC/Partnership has partners who are citizens of 18 states, the LLC/partnership’s citizenship is those 18 states.

Question 26

If it’s a limited partnership, it is a citizen of the states where…

Answer 26

both general and limited partners are citizens.

Question 27

What is the rule regarding citizenship of decedents, minors, or incompetent persons?

Answer 27

Such persons must sue or be sued through a representative. However, the representative’s citizenship is irrelevant. Use the citizenship of the decedent, minor, or incompetent.

Question 28

What is the rule regarding amount in controversy?

Answer 28

in addition to complete diversity or alienage, the plaintiff’s claim must exceed $75,000.

Question 29

If the plaintiff sues for exactly $75,000, does she satisfy the Amount in Controversy requirement?

Answer 29

No. Her claim must exceed the amount in controversy.

Question 30

In order to calculate amount in controversy, we look only at the claim itself, not…

Answer 30

litigation costs or interest on the claim. The claim itself must exceed $75,000.

Question 31

Whatever a plaintiff claims in good faith to exceed the amount in controversy requirement is okay, unless…

Answer 31

it is clear to a legal certainty that she cannot recover more than $75,000.

Question 32

The plaintiff claims diversity, wins, but the jury only gives her $74,000. Is this okay?

Answer 32

Yes. The amount in controversy is an estimation of what the plaintiff could win, and jurisdiction doesn’t go away if she doesn’t win more than that amount.

Question 33

P sues for $50,000 for breach of contract and $60,000 in punitive damages based on that breach of contract. Is there jurisdiction?

Answer 33

No. Relevant authority holds that punitive damages cannot be recovered in contract cases. Thus, the amount in controversy is only $50,000.

Question 34

What is aggregation?

Answer 34

Adding two or more claims to meet the amount in controversy requirement.

Question 35

What is the rule for aggregation?

Answer 35

You can aggragate claims that only involve any one individual plaintiff against any one individual defendant.

It doesn’t matter if the claims aren’t factually related.

Question 36

Is there any limit on the number of claims that can be
aggregated by one P against one D?

Answer 36

No. There is no limit.

Question 37

Plaintiff #1 sues D for $50,000. In the same case, Plaintiff #2 sues D for $40,000. Can we aggregate these claims?

Answer 37

No, they are not by one plaintiff against one defendant.

Question 38

If federal jurisdiction isn’t available, where can cases be filed?

Answer 38

State court.

Question 39

What is the rule regarding joint claims?

e.g. one plaintiff versus multiple defendants.

Answer 39

For joint claims, use the total value of the claim.

e.g. P sues 2 defendants for $25,500 each. Total value is $76,000. Amount in controversy satisfied.

Question 40

Can two or more plaintiffs join their claims to meet the amount in controversy requirement?

Answer 40

Only if the plaintiffs have a common or undivided interest that relate to the claim.

Question 41

What if the plaintiff is seeking equitable relief? What is the rule then?

Answer 41

There are two tests:

1. Plaintiff’s viewpoint- is the loss to the plaintiff more than $75,000?
2. Defendant’s viewpoint- would it cost the defendant more than $75,000 to comply?

If yes to either, the amount in controversy requirement is satisfied.

Question 42

Even if the requirements for a diversity or alienage case are met, federal courts decline to hear some cases. ( called excluded cases)

What kinds of cases will federal courts not hear?

Answer 42

Divorce, alimony, child custody, and to probate an estate.

Question 43

Courts will hear family disputes, so long as…

Answer 43

it doesn’t fit one of the exclusions.