Civil Procedure questions often combine two separate ideas: whether the case belongs in federal court at all, and which sovereign’s rule controls once it gets there. This guide keeps jurisdiction and Erie in separate lanes.
Civil Procedure questions often combine two separate ideas: whether the case belongs in federal court at all, and which sovereign’s rule controls once it gets there. This guide keeps jurisdiction and Erie in separate lanes.
Federal question jurisdiction allows federal courts to hear cases "arising under" federal law. The key is the WELL-PLEADED COMPLAINT RULE.
THE WELL-PLEADED COMPLAINT RULE: Federal question must appear on the FACE of plaintiff's COMPLAINT - not from: • Anticipated defenses (even if defense will definitely be federal) • Federal preemption issues • Defendant's counterclaims • Plaintiff's replication to a defense
Ask: "Looking ONLY at the complaint, does P's cause of action require interpretation of federal law?"
WHAT COUNTS AS "ARISING UNDER": 1. FEDERAL CAUSE OF ACTION: • Claim is created by federal statute (42 USC §1983, federal antitrust, securities fraud) • This is the clearest case - federal law gives P the right to sue
2. STATE CLAIM WITH ESSENTIAL FEDERAL ELEMENT (Grable Test): A state law claim can "arise under" federal law if: • Federal issue is NECESSARILY RAISED • Federal issue is ACTUALLY DISPUTED • Federal issue is SUBSTANTIAL • Exercising jurisdiction won't disturb federal-state balance
This is RARE - most state claims stay in state court even if federal issues arise.
WHAT DOES NOT CREATE FEDERAL QUESTION: • Federal DEFENSE (even if certain to arise) • Complete preemption by federal law (EXCEPTION: This creates federal question) • Federal law used only as evidence • Declaratory judgment where underlying claim would not be federal
THE DECLARATORY JUDGMENT EXCEPTION: Look at the UNDERLYING dispute. If D could have sued P on a federal claim, P's declaratory judgment action "arises under" federal law.
HYPO: P sues D in state court claiming breach of contract. P's complaint alleges D violated their agreement. D plans to defend by arguing the contract is preempted by federal law. D removes to federal court claiming federal question jurisdiction.
ANALYSIS - Is there federal question jurisdiction?
STEP 1: Apply the WELL-PLEADED COMPLAINT RULE Look ONLY at P's complaint: • P's claim = breach of contract • Contract law = STATE law • P's complaint makes no mention of federal law
STEP 2: Does federal defense create federal question? D's preemption defense is a FEDERAL issue, but: • Federal defenses do NOT create federal question jurisdiction • Even if D will certainly raise this defense • Even if D is right about preemption
The test is what appears on P's complaint, NOT what D will argue.
RESULT: NO federal question jurisdiction. Case must be REMANDED to state court.
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HYPO 2 - COMPLETE PREEMPTION EXCEPTION:
P sues former employer in state court for wrongful termination. P alleges breach of employment contract. Unknown to P, the employment is governed by a collective bargaining agreement under the Labor Management Relations Act (LMRA).
ANALYSIS: • LMRA completely preempts state law claims requiring interpretation of CBAs • Complete preemption is different from ordinary preemption • Complete preemption CONVERTS the state claim INTO a federal claim • This DOES create federal question jurisdiction
RESULT: Federal question jurisdiction EXISTS. The complete preemption doctrine (for certain statutes like LMRA, ERISA) transforms what looks like a state claim into a federal claim.
Section sources
Diversity jurisdiction requires TWO things: COMPLETE diversity AND amount in controversy exceeding $75,000.
COMPLETE DIVERSITY (Strawbridge Rule): NO plaintiff can be a citizen of the SAME STATE as ANY defendant. • P1 (NY) + P2 (CA) vs. D1 (TX) + D2 (FL) = Complete diversity ✓ • P1 (NY) + P2 (CA) vs. D1 (TX) + D2 (NY) = NO diversity (P1 and D2 both NY) ✗
DETERMINING CITIZENSHIP:
INDIVIDUALS: Citizenship = DOMICILE (not just residence) Domicile requires: 1. Physical PRESENCE in the state, AND 2. INTENT to remain indefinitely
You can only have ONE domicile at a time. Domicile continues until a new one is established. Students, prisoners: Usually retain prior domicile unless intent to remain.
CORPORATIONS (Can have DUAL citizenship): Citizen of BOTH: 1. State of INCORPORATION, AND 2. State of PRINCIPAL PLACE OF BUSINESS (PPB)
PPB = "Nerve Center" (Hertz Corp): Where high-level officers direct, control, and coordinate corporation's activities. Usually headquarters.
EXAMPLE: Corp incorporated in Delaware with HQ in New York is citizen of BOTH DE and NY. P from either DE or NY destroys diversity.
UNINCORPORATED ASSOCIATIONS (LLCs, Partnerships): Citizen of EVERY state where ANY member is a citizen. LLC with members from 20 states = citizen of all 20 states.
AMOUNT IN CONTROVERSY: Must EXCEED $75,000 (so $75,000.01 works, $75,000.00 doesn't)
GOOD FAITH STANDARD: P's claimed amount controls UNLESS it appears to a "legal certainty" that P cannot recover more than $75,000. • Punitive damages count (if recoverable under applicable law) • Attorneys' fees count (if recoverable under statute/contract) • Interest BEFORE filing counts; interest after filing doesn't
AGGREGATION: • Single P vs. single D: Can aggregate ALL claims • Multiple Ps: Each must satisfy amount UNLESS joint/common interest • Class actions: Special rules (CAFA - $5 million aggregate, minimal diversity)
TIMING: Citizenship determined at TIME OF FILING. • P moves after filing? Still have diversity. • D moves after filing? Still have diversity. • Amount drops below $75K during case? Still have jurisdiction.
HYPO: P (citizen of Florida) sues D Corp for $100,000. D Corp is incorporated in Delaware and has its headquarters in Miami, Florida. Is there diversity jurisdiction?
ANALYSIS:
STEP 1: Determine citizenship of each party
P's citizenship: FLORIDA (domicile)
D Corp's citizenship: A corporation is citizen of: • State of incorporation = DELAWARE • Principal place of business = FLORIDA (HQ in Miami)
D Corp is citizen of BOTH Delaware AND Florida.
STEP 2: Is there complete diversity? P (Florida) vs. D (Delaware AND Florida)
P and D are BOTH citizens of Florida! NO COMPLETE DIVERSITY.
RESULT: No diversity jurisdiction. The case cannot be in federal court based on diversity.
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HYPO 2 - AMOUNT IN CONTROVERSY:
P sues D for breach of contract seeking $50,000 in actual damages. The contract provides that prevailing party recovers attorneys' fees. P's attorney estimates fees will be $30,000.
AMOUNT ANALYSIS: • Actual damages: $50,000 • Attorneys' fees: $30,000 (recoverable under contract) • TOTAL: $80,000
Does this EXCEED $75,000? YES ($80,000 > $75,000)
RESULT: Amount in controversy is satisfied. Attorneys' fees recoverable by statute or contract are included in the calculation.
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HYPO 3 - AGGREGATION:
P1 (TX) has $50,000 claim against D (NY) P2 (CA) has $40,000 claim against same D (NY)
Can P1 and P2 aggregate their claims to meet $75,000?
NO! Multiple plaintiffs can only aggregate if they have a JOINT or COMMON interest (not just similar claims).
P1 must independently satisfy amount: $50,000 < $75,000 = FAILS P2 must independently satisfy amount: $40,000 < $75,000 = FAILS
Neither can invoke diversity jurisdiction (absent supplemental jurisdiction from another claim).
Section sources
Erie is not a substitute for subject matter jurisdiction. First confirm diversity or federal question jurisdiction. Only then ask whether a disputed rule is substantive state law or a procedural matter controlled by federal practice. If a valid Federal Rule is directly on point, Hanna normally controls. If no Federal Rule is on point, use Erie’s twin aims to ask whether ignoring state law would encourage forum shopping or create inequitable administration of the laws.
Section sources
Students identify a federal issue somewhere in the facts and assume federal-question jurisdiction exists, even when the pleaded claim actually arises under state law.
Treating every federal-court procedure issue as automatically governed by federal law without checking whether state law is substantive or whether a Federal Rule is actually on point.