Subject Matter JX

Question 1

What are the 5 ways congress grants SMJ?

Answer 1

Federal Question, Legislative, Diversity, Supplemental, and Removal

Question 2

What is Presumption in SMJ?

Answer 2

Federal courts must assume absence of SMJ, burden is on party invoking court to prove SMJ

Question 3

What is Waiver in SMJ?

Answer 3

SMJ cannot be waived/agreed to between parties, unlike Personal Jurisdiction

Question 4

Objection to SMJ?

Answer 4

Any party, including the court, may object to SMJ at any point, but if a party is not contested at the lower court, it may not be challenged

Question 5

Generally, federal courts must adjudicate if SMJ, but can abstain/stay for the following four reasons:

Answer 5

(1) A resolution of a state law issue by the state court would eliminate need for the federal court to decide a federal constitutional issue (Pullman abstention, equal protection);
(2) Avoidance of federal involvement with complex, greatly important, state regulatory scheme (Louisiana Power and Light, eminent domain interpretation);
(3) State action involves criminal punishment/contempt of court/ civil fine and federal court is asked to enjoin such activity (Younger abstention, pending state prosecution);
(4) Parallel proceedings that go beyond mere waste of judicial resources (Colorado River, duplicative adjudication)

Question 6

Contrary to abstention, when should federal courts intervene?

Answer 6

Plaintiff must demonstrate:

Unusual circumstances requiring equitable relief
Dire irreparable injury
Prosecutorial bad faith

Question 7

SMJ – FQ – Basis?

Answer 7

Article 3, Section 2, gives Congress authority to grant original jurisdiction to federal courts.

Question 8

SMJ – FQ – Concurrent vs Exclusive JX?

Answer 8

States and federal courts have concurrent jurisdiction of FQ claims, except when Congress expressly provides that the jx of the federal courts is exclusive (SEC, patents, etc.)

Question 9

SMJ – FQ – What is FQ and what is not?

Answer 9

Look to cause of action and underlying right, make arguments for both sides.

If U.S. owns over 50% of federal corp, then FQ

State laws incorporating federal standards, not FQ

If no federal remedy, then argue both sides of FQ

Question 10

SMJ – FQ – Well-pleaded complaint rule

Answer 10

Federal law issue must be presented on the face of the P’s complaint, only necessary elements of the P’s claim can be considered, potential defenses/answers/counterclaims don’t count. (For both original and removal jx).

For declaratory relief, which anticipates infringement of federal right, no FQ unless there is no remedy available in state law.

Question 11

SMJ – Diversity – Basis?

Answer 11

Article 3, Section 2; 1332 gave district courts jx over actions involving a dispute over 75K and the parties to an action are:

Citizens of different states
Citizens of a state and citizens/subjects of a foreign state (additional parties)
Foreign state is a P

Question 12

SMJ – Diversity – State law exclusions

Answer 12

Probate and domestic relations (must be primarily probate or domestic)

Question 13

SMJ – Diversity – FSIA

Answer 13

Under FSIA, a suit may not be brought against a foreign state unless one of the following exemptions apply:

Commercial activity
Seizing property in violation of international alw
Tort committed in the U.S.

Question 14

SMJ – Diversity – Complete diversity, realignment and date of determination

Answer 14

If any P is in the same state as any D, then no diversity, if any P AND any D is an alien then no diversity.

Realignment – Courts will not allow a P to be listed as a D, will look to ultimate interests

Date of determination – time the case is filed, before and after doesn’t matter

Question 15

SMJ – Diversity – Complete diversity exceptions (3)

Answer 15

Interpleader – Property dispute needs only two adverse claimants of diversity of citizenship to establish SMJ

Class actions greater than 5,000,000 need only one member of P class to be diverse from any D

Multiparty/Multiforum – If 75 natural persons have died from single accident, only one P needs to be diverse from any D IF (i) D resides in different state than the accident state OR (ii) Any two Ds reside in different states OR (iii) substantial parts of the accident took place in different states. However, district court must abstain if majority of all Ps are from the same state as primary Ds and the claims will be governed primarily by that state.

Question 16

SMJ – Diversity – Citizenship of Individuals

Answer 16

Must be US Citizen + Domicile

Domicile – only one, continues until manifestation of intent to remain in new state and physical presence in new state.

Date of determination – time case if filed, doesn’t matter before or after.

Question 17

SMJ – Diversity – Citizenship of aliens and stateless persons

Answer 17

Exists when aliens on one side and state citizen on another side. If alien is admitted for permanent residence in US and is domiciled in same state as other party then no diversity.

No diversity if a party is stateless alien, or US citizen domiciled in foreign country.

Question 18

SMJ – Diversity – Citizenship of minors, incompetents, etc.

Answer 18

Look to minor’s citizenship, not to representation. Unemancipated minor is same as parents, or same as custodial parent.

Question 19

SMJ – Diversity – Citizenship of class actions with an amount in controversy of less than 5,000,000.

Answer 19

Look to named members of class bringing the suit to determine completeness of diversity (for lower than 5,000,000).

Question 20

SMJ – Diversity – Citizenship of corporations

Answer 20

Corporations are citizens of the state(s) in which they are incorporated and the state(s) in which they have their principal place of business (nerve center, usually where high ranking officers make important decisions).

Same for foreign corporations.

Date of determinations – time action is filed.

Insurer exception – insurer is a citizen of the state where its client is a citizen.

Question 21

SMJ – Diversity – Citizenship of partnerships or unincorporated businesses

Answer 21

For partnerships, each state where a partner is domiciled.

Unincorporated business may be considered only citizens of the states where representative parties are domiciled.

Question 22

SMJ – Diversity – Destroying or creating diversity (4)

Answer 22

Assignment – When legitimate assignment, look to assignee for citizenship (must not be collusive assignment)

Party may not manufacture diversity by failing to name/join indispensable party

Voluntarily moving to create new domicile to manufacture diversity is not allowed.

Substitution (death) – new party doesn’t need to satisfy diversity

Replacement (wrong party) – new party must be diverse

Question 23

SMJ – Diversity – Amount in controversy

Answer 23

Sum/value of claim must exceed $75,000 (attorney’s fees count if recoverable by contract/statute). For injunctive relief, court looks to harm to P and cost to D, either one can satisfy.

Date of determination – Time of action, or if removal, then time of removal.

Burden of proof – Good faith is enough as long as its not near legal certainty that amount is not recoverable. Reduction afterwards doesn’t destroy diversity.

Question 24

SMJ – Diversity – Amount in controversy aggregation

Answer 24

1 P versus 1D: Aggregate P’s claims

Multiple Ps, same claims: Aggregate claims
Multiple Ps, different claims: No aggregation

1 P versus multiple Ds: Aggregate of same claim or if Ds are jointly liable, no aggregation for different claims

Class actions: No aggregation, if any member has a claim less than $75,000 then no diversity

Question 25

SMJ – Diversity – Amount in controversy counterclaims

Answer 25

Counterclaims don’t count for P’s amount in controversy.

Compulsory CCs – CCs arising out of same transaction as Ps claim don’t have to meet amount in controversy
Permissive CCs – Must meet amount in controversy

Removal: P can’t remove, D can’t remove with permissive CC if Ps claim doesn’t meet requirements, for compulsory CCs courts are split.

Question 26

SMJ – Supplemental JX test (FQ)

Answer 26

District court with JX may exercise JX over another claim (state law, non-diverse) if they arise out of a common nucleus of operative fact.

FQ Supplemental JX – Title IV + state law tort (supplemental) if same common-nucleus, even if requiring the joinder of additional parties

Question 27

SMJ – Supplemental JX test (Diversity)

Answer 27

Permissive Joinder – additional claim doesn’t need to satisfy amount in controversy, but joined P must satisfy complete diversity + common nucleus test (only for additional claims, not for additional Ds, additional Ds must complete diversity)

Counterclaims – Compulsory CC can be supplemented without meeting minimum amount in controversy, permissive CCs cannot be supplemented (so need amount in controversy + complete diversity).

Cross-claims – As long as court has SMJ, allowed.

Question 28

SMJ – Supplemental JX test preclusion (Diversity)

Answer 28

If JX is solely based on diversity, then supplemental JX is precluded for:

Claims by existing Ps against persons made parties under Rule 14 (Impleader), 19 (Compulsory joinder), 20 (Permissive joinder) and 24 (Intervention)

Question 29

SMJ – Supplemental JX discretionary rejection

Answer 29

Court may reject supplemental JX if supplemental claim issues novel/complex issues of state law, it substantially dominates original claim, all original claims have been dismissed, other compelling reasons.

Question 30

SMJ – Removal JX (Defendant only)

Answer 30

Date of determination – Diversity must have existed at the time of the original filing and at the time the notice for removal is filed.

For diversity (not FQ) removal allowed only if no D is a citizen of the state in which the action was filed.

For FQ – entire case may be removed if inextricable.

Question 31

SMJ – Removal JX Procedure

Answer 31

All Ds must join in for diversity, only attacked Ds must join in for FQ, file within 30 days of receipt of pleading.

For diversity, one year maximum time limit for removal. For removal of injunctive relief, D only need to show that $75,000 is plausible.

Must give notice to all adverse parties, file a copy with state clerk.

For jury trial, both parties must file within 14 days or risk losing the right