Also known as: diversity jurisdiction
Written by attorneys · grounded in primary & secondary sources — see below
A form of federal subject-matter jurisdiction that permits district courts to adjudicate civil actions between citizens of different states when the amount in controversy exceeds seventy-five thousand dollars. Complete diversity must exist so that no plaintiff shares citizenship with any defendant. Unincorporated associations take the citizenship of every member rather than a single state of formation.
Dustin Donovan, a citizen of State A, filed suit in federal court against Delta Dynamics, a general partnership whose partners include several citizens of State A. The complaint sought damages exceeding seventy-five thousand dollars for breach of a supply contract. Because the partnership shares citizenship with Donovan through its members, the district court dismissed the action for lack of subject-matter jurisdiction.
Deborah Dunn, a citizen of State B, sued Drake Logistics, a State C corporation, in federal court under diversity jurisdiction for negligence arising from a warehouse accident. The court applied State B tort rules to the duty and causation elements rather than any independent federal standard. The choice of law produced the same outcome that a State B court would have reached.
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Damian Decker, a citizen of State D, brought a contract claim against Dillon Energy, a State E corporation, in federal court asserting diversity jurisdiction. The court looked to State D decisions on contract interpretation to decide whether an oral modification was enforceable. That choice avoided the forum-shopping problem that would have arisen under a different substantive rule.
Dorothy Daniels, a citizen of State F, sued Dynamic Solutions, a State G corporation, for more than seventy-five thousand dollars under diversity jurisdiction. After the defendant impleaded a third-party supplier, Daniels added her own state-law indemnity claim against that supplier. The court exercised supplemental jurisdiction over the indemnity claim because it arose from the same transaction as the original diversity action.
Darius Dixon, a citizen of State H, sued Delta Dynamics in federal court under diversity jurisdiction seeking an injunction to enforce a restrictive covenant. The court applied the State H rule that treats the requested relief as substantive and therefore governed by state law. The injunction issued only because State H precedent permitted it under the facts alleged.
Daniel Diaz, a citizen of State I, sued Drake Logistics in federal court under diversity jurisdiction after a delivery accident. Drake moved to strike the jury demand under a State I statute that bars juries in certain commercial cases. The court denied the motion because the federal rules on jury trials controlled over the conflicting state practice.
An unincorporated association such as a partnership or LLC takes the citizenship of every one of its members. If any member shares citizenship with an opposing party, complete diversity is destroyed and the federal court lacks subject-matter jurisdiction.
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Complete diversity must exist at the time the complaint is filed. Each plaintiff must be a citizen of a different state from every defendant. Later changes in citizenship do not cure an initial defect.
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Yes. The plaintiff must allege in good faith that the amount in controversy exceeds seventy-five thousand dollars exclusive of interest and costs. A legal certainty that the claim cannot reach that threshold defeats jurisdiction even if the parties are diverse.
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Yes. When a federal rule directly addresses the matter in dispute, it governs even if a contrary state rule would produce a different outcome. The federal rule must be valid under the Rules Enabling Act and the Constitution.
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…developed a new well of uncertainties.[^maj-8] On the other hand, the mischievous results of the doctrine had become apparent. Diversity of citizenship jurisdiction was conferred in order to prevent apprehended discrimination in state courts against those not citizens of the State. Swift v. Tyson introduced grave discrimination by non-citizens…