339 U.S. 667 (1950)
In 1945 Michigan-Wisconsin Pipe Line Company applied to the Federal Power Commission for a certificate of public convenience and necessity to construct and operate a natural gas pipeline from Texas to Michigan and Wisconsin.1 On December 11, 1945 Phillips Petroleum Company contracted with Michigan-Wisconsin to supply gas from the Hugoton Gas Field.2 Phillips had previously entered into separate contracts with Skelly Oil Company, Stanolind Oil and Gas Company, and Magnolia Petroleum Company under which it agreed to purchase gas produced by those companies in the Hugoton Field for resale to Michigan-Wisconsin.3 Each of the three contracts contained an identical termination clause permitting the seller to end the agreement by written notice delivered after December 1, 1946 but before issuance of the certificate if Michigan-Wisconsin failed to obtain the certificate by October 1, 1946.4
On November 30, 1946 the Federal Power Commission adopted an order stating that a certificate of public convenience and necessity was issued to Michigan-Wisconsin subject to enumerated conditions, including approvals from the State of Wisconsin and affected communities, Securities and Exchange Commission financing approval, and filing of reasonable rate schedules.5 The order further provided that the date of issuance for purposes of rehearing applications would be the later of the date of the opinions or a supplemental order.6 The full text of the order was not released to the public until December 2, 1946.7 On that same date Skelly, Stanolind, and Magnolia each delivered written notice to Phillips terminating their contracts on the ground that Michigan-Wisconsin had not obtained the required certificate.8
Michigan-Wisconsin and Phillips filed suit against the three oil companies in the United States District Court for the Northern District of Oklahoma.9 They sought a declaratory judgment that the contracts remained in full force and effect, alleging that a certificate within the meaning of the Natural Gas Act and the contracts had been issued before the termination notices.10 The district court granted motions to drop Michigan-Wisconsin as a plaintiff but denied motions to dismiss for lack of jurisdiction, proceeded to the merits, and entered judgment declaring that the contracts had not been effectively terminated.11 The Court of Appeals for the Tenth Circuit affirmed.12
Phillips is a Delaware corporation.13 Skelly and Stanolind are not diverse from Phillips.14 Magnolia is a Texas corporation that had qualified to do business in Oklahoma and appointed an agent for service of process there.15 The Supreme Court granted certiorari because the case presented the question whether a suit of this character arises under the laws of the United States so as to support declaratory relief in federal district court.16
Whether a suit for declaratory relief under the Federal Declaratory Judgment Act arises under the laws of the United States within the meaning of 28 U.S.C. § 1331 when the plaintiff's claim rests on state contract law and any federal question would enter the case only as an anticipated defense?17
No. Phillips and Michigan-Wisconsin sought a declaration that the contracts remained in full force and effect after the sellers delivered termination notices.2021 Their claim rested entirely on the interpretation of state-law contracts.22 The question whether the Federal Power Commission order constituted issuance of a certificate under the Natural Gas Act would arise only if the defendants raised it as a defense.23 The established facts show that the complaint alleged a certificate had been issued within the meaning of the contracts, but this federal element was injected solely to defeat the anticipated termination defense.24
The district court lacked federal-question jurisdiction under 28 U.S.C. § 1331 over the declaratory claims.25
Related opinions on this issue
Joined by Mr. Justice Burton
Chief Justice Vinson expressed real doubts as to whether there is a federal question here at all, even though interpretation of the contract between private parties requires an interpretation of a federal statute and the action of a federal regulatory body.26 He nevertheless concurred in the result that jurisdiction does not attach because any federal question is not part of the plaintiff's claim.27 While this result is not a necessary one, he was not prepared to dissent from it at this time.28
Whether the District Court had jurisdiction over the claims against Skelly Oil Company and Stanolind Oil and Gas Company on the basis of diversity of citizenship?29
Diversity jurisdiction under 28 U.S.C. § 1332 requires complete diversity of citizenship between all plaintiffs and all defendants.30
No. Phillips is a Delaware corporation. Skelly and Stanolind are not diverse from Phillips. Therefore complete diversity is absent and the district court could not entertain the claims against Skelly and Stanolind on diversity grounds. The record establishes that Phillips as plaintiff shares citizenship with both Skelly and Stanolind, precluding any exercise of diversity jurisdiction over those defendants.31
The district court lacked diversity jurisdiction over the claims against Skelly Oil Company and Stanolind Oil and Gas Company.32
Whether the District Court had jurisdiction over the claim against Magnolia Petroleum Company on the basis of diversity of citizenship?33
Diversity jurisdiction exists when the plaintiff and defendant are citizens of different states and the defendant has consented to suit in the forum by qualifying to do business and appointing an agent for service of process.34
Yes. Phillips is a Delaware corporation and Magnolia is a Texas corporation. The established facts show Magnolia qualified to do business in Oklahoma and appointed an agent for service of process there. Under the doctrine of Neirbo Co. v. Bethlehem Shipbuilding Corp. venue was proper in Oklahoma conferring diversity jurisdiction over the claim against Magnolia.35
The district court possessed diversity jurisdiction over the claim against Magnolia Petroleum Company.36
Whether the Federal Power Commission's November 30, 1946 order satisfied the contractual requirement that Michigan-Wisconsin Pipe Line Company secure a certificate of public convenience and necessity before the sellers could terminate their contracts with Phillips Petroleum Company?37
When a contract uses language identical to a regulatory statute the contractual term may carry an independent meaning that requires consideration of agency practice and the full regulatory context rather than a truncated statutory construction.38
No. The Court of Appeals equated the contract term with the statutory term and held the November 30 order satisfied the requirement. The Supreme Court declined to decide the question on that basis. The established facts reveal that the order contained conditions deferred the date of issuance for rehearing purposes and was not publicly released until December 2. Because the lower courts lacked the benefit of the Commission's own experience regarding when a certificate is deemed issued the proper disposition is to vacate the judgment as to Magnolia and remand for further proceedings.39
The judgment as to Magnolia is vacated and the cause is remanded for further proceedings without a determination on the merits of the contractual issue.40
Related opinions on this issue
Joined by Mr. Justice Burton
Chief Justice Vinson would have affirmed the Court of Appeals as to Magnolia.41 He concluded that the Commission intended to and did issue the certificate on November 30, 1946, the date the order was adopted and publicly announced by telegram and press release.42 In his view the contractual clause should be construed in light of the Commission's effective date of agency action which occurred on November 30 and no remand was necessary.43
The District Court found as a fact that the Commission in executive session made the order granting the certificate on November 30 and directed immediate release.44