Bar Exam — MBE (Multistate Bar Exam)Civil ProcedureEasy
A plaintiff, a citizen of State A, filed a lawsuit in federal court in State A against a defendant, a citizen of State B. The plaintiff's complaint alleges a state law claim for breach of contract and seeks $80,000 in damages. Does the federal court have subject matter jurisdiction over this case?
- AYes, because there is complete diversity of citizenship and the amount in controversy exceeds $75,000.
- BNo, because the plaintiff is suing in their home state.
- CYes, because the federal court has concurrent jurisdiction over state law claims.
- DNo, because the amount in controversy does not exceed $75,000.
Show answer & explanationAnswer & explanation
Correct answer: A. Yes, because there is complete diversity of citizenship and the amount in controversy exceeds $75,000.
Diversity jurisdiction requires complete diversity of citizenship and an amount in controversy exceeding $75,000. Here, the parties are citizens of different states, and the plaintiff seeks $80,000, satisfying both requirements.
Why the other options are wrong
- B. The 'in-state defendant' rule for diversity jurisdiction applies to venue, not subject matter jurisdiction. A plaintiff can sue an out-of-state defendant in their home state's federal court if diversity and amount in controversy are met.
- C. Federal courts have concurrent jurisdiction over many state law claims, but only if there is a basis for federal subject matter jurisdiction, such as diversity or federal question.
- D. The amount in controversy is $80,000, which does exceed $75,000.
Diversity Jurisdiction (Amount in Controversy)
For federal courts to have diversity jurisdiction, the amount in controversy must exceed $75,000, exclusive of interest and costs.
- Amount must be over $75,000.
- Determined by plaintiff's good faith claim.
- Interest and costs are typically excluded.
Memory trick: Diverse citizens with large wallets get into federal court.