Civil Procedure Bar Prep

SUBJECT-MATTER JURISDICTION (SMJ

Power of court to assert jurisdiction over a particular case (3 ways to establish)

• Federal question jurisdiction

• Diversity jurisdiction

• Supplemental jurisdiction

Federal Question Jurisdiction (FQ)

Federal courts are empowered to hear claims presenting a question of federal law. Federal law includes the federal Constitution, federal statutes and treaties, and federal common law.

FQ; Well-Pleaded Complaint Rule

A question of federal law must arise in the plaintiff’s affirmative claim, regardless of any defense the defendant might raise.

• Anticipatory defenses to federal law cannot be used to satisfy FQ

FQ; Well-Pleaded Complaint Rule; Can a court can assert jurisdiction over a state law claim that raises a federal issue?

• A court can assert jurisdiction over a state law claim that raises a federal issue if the FQ is:

  • Necessarily raised;

  • Actually disputed;

  • Substantial; and

  • Capable of resolution in federal court without disrupting the federal-state balance approved by Congress.

• EXAMPLE: P rents land to D, a farmer. The lease states that D must comply with all federal environmental laws. One day, P sees D dumping oil in a creek on the land, an action he believes to be a violation of federal environmental law. D believes that dumping oil is permissible in limited quantities. P wishes to terminate the lease in an action under state law. P can sue in federal court because his state law claim will require the court to interpret federal environmental law—a substantial federal issue where federal judges are likely to have a comparative expertise and where the issue should be resolved as uniformly as possible. In addition, the federal issues are not so common in landlord-tenant disputes that federal courts would end up taking the state courts’ landlord-tenant jurisdiction from them.

• EXAMPLE: P rents land to D, a farmer. The lease states that D may not apply chemicals to the land that are listed in the EPA’s list of “dangerous chemicals.” P believes that D put Chemix on the land—a chemical on the “dangerous chemicals” list. D agrees that Chemix is on the list but simply denies that he ever used Chemix. P may not sue in federal court using federal question jurisdiction because there is no actual dispute pertaining to federal law.

  • Everyone agrees with what the federal  law says, the issue is a matter of fact. Therefore, FQ is not satisfied

Diversity Jurisdiction

Federal courts have jurisdiction over actions where there is (1) complete diversity at the time of filing and (2) the amount in controversy is greater than $75,000.

• Complete Diversity- no plaintiff and no defendant are citizens of the same state

• Suit must be reevaluated when amendments are made to add parties. If an original defendant moves to a state where a new added party lives, this will destroy complete diversity

  • EXAMPLE: Mary, a citizen of Maryland, sues Ken, a citizen of Kentucky, for $80,000 in federal court. The court has subject-matter jurisdiction. During the suit, Ken moves to Maryland. The court still has subject-matter jurisdiction. After Ken moves to Maryland, Mary decides to amend her complaint to add Joe (a citizen of Maryland) as a defendant. Mary’s amendment will destroy the court’s subject-matter jurisdiction.

    
    

Diversity Jurisdiction; Class Action Suits

• Diversity Jurisdiction can be satisifted in Class action suits when there are more than 100 persons and $5M.

  • Diversity need only be “minimal” – a single plaintiff is diverse from a single defendant.

Determining Citizenship; Human Beings

• Human beings are only citizens of one place at a time: the state where they reside and intend to remain indefinitely.

• Wanderer Rule: A human being’s citizenship does not change until the person plants roots in a new state by residing there and intending to remain indefinitely.

  • EXAMPLE: Honeysuckle Jim was born in Oklahoma but left home at 11 years old to ride the rails. He is now 52 and has been riding the rails his entire life, though he has never once passed through Oklahoma. Over the past month, he’s been living in a boxcar in an Omaha, Nebraska rail yard. He likes it there but said, “Me? Oh, I don’t live anywhere. Only home I have is the road.” Honeysuckle is still an Oklahoma citizen because he acquired that citizenship at birth and has never resided anywhere else that he intended to remain indefinitely.

Determining Citizenship; Corporations

• Corporations could be citizens of two places. They are citizens of the state where they are incorporated and the state in which they maintain their principal place of business (nerve center).

• In order to satisfy Diversity Jurisdiction with a corporation, the state of incorporation and its nerve center need to be different from the other party’s home.

  • EXAMPLE: P is a citizen of Ohio. Last year, she suffered serious injuries in a bicycle accident and wants to sue the manufacturer, InMotion Bikes, Inc. InMotion is incorporated under the laws of Delaware and headquartered in Ohio. P cannot sue InMotion in federal court under diversity jurisdiction, because InMotion is a citizen of Ohio. It is irrelevant that InMotion is also a citizen of Delaware. The presence of Ohio “on both sides of the v” is enough to destroy diversity.

  • EXAMPLE: Assume that InMotion manufactures its bikes in Ohio but runs its business from its corporate offices in Greenwich, Connecticut. P and InMotion are now diverse because InMotion’s manufacturing plant is not its “nerve center.” InMotion, thus, has no Ohio citizenship.

Unincorporated associations

(unions, LLCs, partnerships) are citizens of the state(s) where every member is a citizen. This could be all 50 states.

Representative of an incapacitated party

(i.e., minor or deceased): Citizenship is that of the incapacitated party – not the representative.

Diversity Jurisdiction; Amount in Controversy

The amount in controversy must exceed $75,000. This does not include, and differs, from the amount in damages

• A court will defer to the plaintiff’s allegation of financial injury, unless it appears “to a legal certainty” that such allegations are incorrect.

• The plaintiff does not have to actually recover over $75,000 in damages; they just need to plead an appropriate amount in good faith. Defer to plaintiff’s allegations unless there is legal certainty the damages differ.

  • Does not matter what P actually recovers

Diversity Jurisdiction; Aggregation of Claims

• If a plaintiff brings multiple claims against a single defendant the court will aggregate claims to see if the amount in controversy is reached.

  • Claims can be totally unrelated; there is no same transaction or occurrence requirement.

  • Can’t aggregate a plaintiff’s multiple claims against multiple defendants.

EXAMPLE: P has had it up to here with D. Last year, D ran over P’s cat (causing her $30,000 in damages). Then, a few months later, D cut down a tree that fell on P’s house (causing her another $30,000 in damages). And just last week, D defamed P by calling her a “liar and a cheater” (causing her $20,000 in damages). If P sues D for all three claims at once, the amount in controversy for diversity jurisdiction will be $80,000.

EXAMPLE: P was in a bar when Dip and Dup beat him up. He suffered $50,000 total in injuries. If P sues Dip and Dup in the same suit, the amount in controversy will be $50,000, regardless of the fact that P is alleging that each defendant, pursuant to the rules of joint and several liability, is personally liable for $50,000. The same answer would be obtained if two plaintiffs each sued a single D for $50,000 in a single suit. In that suit, D may have to pay out $100,000 in damages, but the amount in controversy for each P is only $50,000.