Bar Exam — MBE (Multistate Bar Exam)Civil ProcedureEasy
A plaintiff, a citizen of State A, filed a lawsuit in federal court in State B against a defendant, a citizen of State B, alleging a breach of contract for $80,000. Under which grounds, if any, could the federal court properly assert subject matter jurisdiction?
- ANo subject matter jurisdiction, because the amount in controversy is exactly $80,000, not 'more than' $75,000.
- BDiversity jurisdiction, because the parties are citizens of different states and the amount in controversy exceeds $75,000.
- CSupplemental jurisdiction, as the claim arises from the same case or controversy as an unstated federal claim.
- DFederal question jurisdiction, as contract disputes inherently involve federal common law.
Show answer & explanationAnswer & explanation
Correct answer: B. Diversity jurisdiction, because the parties are citizens of different states and the amount in controversy exceeds $75,000.
Federal courts have diversity jurisdiction over civil actions where the amount in controversy exceeds $75,000 and the action is between citizens of different states. Here, both requirements are met.
Why the other options are wrong
- A. The statutory requirement is 'exceeds $75,000.' An amount of $80,000 clearly exceeds $75,000, thus meeting the requirement.
- C. There is no mention of an unstated federal claim, and supplemental jurisdiction requires a primary claim over which the federal court already has original jurisdiction.
- D. Contract disputes are generally governed by state law, not federal common law, unless a specific federal interest is involved.
Diversity Jurisdiction
Federal courts can hear cases between citizens of different states if the amount in controversy exceeds $75,000, excluding interest and costs.
- Complete diversity required (no plaintiff shares citizenship with any defendant).
- Amount in controversy must be > $75,000.
- Purpose is to protect out-of-state litigants from potential bias in state courts.
Memory trick: FedSMJ: Federal Subject Matter Jurisdiction, remember the FED's two main DOORS: Federal Question and Diversity.