Diversity jurisdiction

In the law of the United States, diversity jurisdiction is a form of subject-matter jurisdiction that gives U.S. federal courts the power to hear lawsuits that do not involve a federal question. For a U.S. federal court to have diversity jurisdiction over a lawsuit, two conditions must be met. First, there must be "diversity of citizenship" between the parties, meaning the plaintiffs must be citizens of different U.S. states than the defendants. Second, the lawsuit's "amount in controversy" must be more than

75,000. If a lawsuit does not meet these two conditions, U.S. federal courts will normally lack the power to hear it unless it involves a federal question, and the lawsuit would need to be heard in state court instead. The United States Constitution, in Article III, Section 2, grants Congress the power to permit federal courts to hear diversity cases through legislation authorizing such jurisdiction. The provision was included because the Framers of the Constitution were concerned that when a case is filed in one state, and it involves parties from that state and another state, the state court might be biased toward the party from that state. Congress first exercised that power and granted federal trial circuit courts diversity jurisdiction in the Judiciary Act of 1789. Diversity jurisdiction is currently codified at . In 1969, the American Law Institute explained in a 587-page analysis of the subject that diversity is the "most controversial" type of federal jurisdiction, because it "lays bare fundamental issues regarding the nature and operation of our federal union." (a) The district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of

75,000, exclusive of interest and costs, and is between— (1) citizens of different States; (2) citizens of a State and citizens or subjects of a foreign state, except that the district courts shall not have original jurisdiction under this subsection of an action between citizens of a State and citizens or subjects of a foreign state who are lawfully admitted for permanent residence in the United States and are domiciled in the same State; (3) citizens of different States and in which citizens or subjects of a foreign state are additional parties; and (4) a foreign state, defined in section 1603(a) of this title, as plaintiff and citizens of a State or of different States.

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Related concepts (13)

Diversity jurisdiction

U.S. state

In the United States, a state is a constituent political entity, of which there are 50. Bound together in a political union, each state holds governmental jurisdiction over a separate and defined geographic territory where it shares its sovereignty with the federal government. Due to this shared sovereignty, Americans are citizens both of the federal republic and of the state in which they reside.

Judiciary Act of 1789

The Judiciary Act of 1789 (ch. 20, ) was a United States federal statute enacted on September 24, 1789, during the first session of the First United States Congress. It established the federal judiciary of the United States. Article III, Section 1 of the Constitution prescribed that the "judicial power of the United States, shall be vested in one Supreme Court, and such inferior Courts" as Congress saw fit to establish. It made no provision for the composition or procedures of any of the courts, leaving this to Congress to decide.