The Volokh Conspiracy
[David Bernstein, August 25, 2006 at 5:05pm] Trackbacks
Bleg for Help re Diversity Jurisdiction, Complete Diversity:

I need to know rather quickly if there have been any recent (last several years) developments with regard to diversity jurisdiction, specifically with regard to the issue of complete diversity, other than the provisions of the Class Action Fairness Act. Has there been proposed legislation to further relax the complete diversity requirement? Thanks.

JohnO (mail):
CAFA allows nominal diversity (where any defendant is a domiciliary of a different state from any plaintiff) to support removal if the other statutory prerequisites have been met.
8.25.2006 5:19pm
zooba:
There's also the MULTIPARTY, MULTIFORUM TRIAL JURISDICTION ACT OF 2002, 107 P.L. 273, codified at 28 USC 1369. It creates jurisdiction in federal district courts for cases "that arise[] from a single accident, where at least 75 natural persons have died in the accident at a discrete location" if there is minimal diversity as well as some special misc. diversity-like requirements.
8.25.2006 5:58pm
Ted Frank (www):
There are some once-in-a-blue-moon-Rube-Goldberg exceptions to nominal diversity in CAFA that were kluged onto the bill to get the sixtieth vote, but it otherwise generally creates nominal diversity.

28 U.S.C.A. § 1369 is a recent (2002?) expansion of diversity jurisdiction.

Marshall v. Marshall (U.S. 2006) clarified the law with respect to the probate exception to diversity (and other federal) jurisdiction.

Wachovia Bank, N.A. v. Schmidt, 126 S.Ct. 941 (2006) clarified the scope of diversity jurisdiction as it applies to national banks.

Tedford v. Warner-Lambert Co., 327 F.3d 423 (5th Cir. 2003), effectively expanded diversity jurisdiction by refusing to apply §1446(b) to cases of fraudulent joinder.

Diversity jurisdiction for LLCs and professional corporations is still in flux, e.g., Belleville Catering Co. v. Champaign Marketplace, LLC, 350 F.3d 691, 692 (7th Cir. 2003); Hoagland ex rel. Midwest Transit, Inc. v. Sandberg, Phoenix &von Gontard, P.C., 385 F.3d 737, 743 (7th Cir. 2004).

Exxon Corp. v. Allapattah (U.S. 2005) is technically about supplemental, rather than diversity, jurisdiction, but had important implications for determining the amount-in-controversy side of the diversity of class actions, as there had been a bad circuit split on the issue.
8.25.2006 5:59pm
J..:
Other than CAFA, I'm not aware of any proposed legislation (though, this has been discussed as possible tort reform by the fed-soc, iirc).

Defendants have attempted to expand the use of the shared-pot doctrine (e.g., plaintiff's req for disgorgement of profits leads to aggregation) to defeat the amount in controversy requirement. Also, defendants have further attempted to utilize the fraudulent joinder theories to defeat diversity. Both have some recent case law (prior to CAFA) out of the diet drug litigation.
8.25.2006 5:59pm
Ted Frank (www):
S.2856 modifies the definition of citizenship of federal savings associations under 12 U.S.C. § 1464 for purposes of diversity jurisdiction, but the House and Senate haven't reconciled their versions yet.

There are a variety of bills over the last several years that would establish federal-question jurisdiction over cases that previously could not be in federal court without diversity jurisdiction, e.g., H.R. 1957, the Asbestos Compensation Fairness Act of 2005.
8.25.2006 6:19pm
An Anonymous Comment (mail):
The Ninth Circuit ruled on a small question in this area recently: whether, after the passage of section 1367, the intervention of a non-diverse, non-indispensable defendant-intervenor destroys complete diversity. The court, sustaining the pre-1367 rule, found that it does not. The opinion in Mattel v. Bryant is available here.
8.25.2006 6:32pm
CJColucci:
Here's an oddball question. You want to sue X under federal law, but you and X are also residents of different states. Suppose this had happened before Congress gave the federal courts general federal question jurisdiction in 1875. Would you have been able to bring what is, in substance, a federal question case using diversity jurisdiction?
8.25.2006 6:37pm
Ted Frank (www):
CJ: If diversity jurisdiction was available, yes. Just as one can bring federal-question jurisdiction cases now when the amount in controversy is less than $75,000.
8.25.2006 7:04pm
Arthur D. Hellman (mail):
You might want to take a look at H.R. 5440, the Federal Courts Jurisdiction Clarification Act of 2006. The bill largely tracks a proposal by the Judicial Conference of the United States that was the subject of a hearing on Nov. 15, 2005. (I was one of the witnesses at the hearing.) The hearing transcript and supplementary material can be found at
8.26.2006 1:19am
Arthur D. Hellman (mail):
The preceding post did not include the link. Here it is.

8.26.2006 1:21am

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