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Introduction

Read the overview below and complete the activities that follow.

Subject Matter Jurisdiction

Congress has limited the judicial power of the federal courts. Federal courts have the power to hear cases involving (1) questions of federal law (federal question cases), (2) the United States as a party, (3) controversies among the states, and (4) certain suits between citizens of different states (diversity of citizenship).

CONCEPT REVIEW: Federal question cases may be based on issues arising out of the U.S. Constitution or out of federal statutes. Any amount of money may be involved in such a case, and it need not be a suit for damages. These civil actions may involve matters based on federal laws such as those dealing with patents, copyrights, trademarks, taxes, or employment discrimination. The rights guaranteed by the Bill of Rights of the Constitution also may be the basis for a federal question case.

Diversity of citizenship requires that all plaintiffs be citizens of different states from all defendants. If a case involves a party on one side that is a citizen of the same state as a party on the other, there will then be no diversity of citizenship and thus no federal jurisdiction. For purposes of diversity jurisdiction, a corporation is a citizen of the state of incorporation and also a citizen of the state in which it has its principal place of business. In addition, diversity of citizenship cases also require that the amount in dispute be more than $75,000.

Case Analysis

Subject Matter Jurisdiction

Read the following scenario and answer the questions that follow.

While driving to work in Vermont, Susan, a citizen of Vermont, is struck by a truck driven by Will, a citizen of Illinois. Will's employer, Frank's Furniture, a corporation headquartered in Vermont but incorporated in Delaware, owned the truck. Susan sustains serious injuries resulting in $80,000 in medical bills.

If Susan sues only Will for $80,000 in damages resulting from her injuries in federal district court in Montpelier, Vermont, will the court have proper subject matter jurisdiction?

Multiple Choice

• Yes, because there is diversity of citizenship federal jurisdiction.

• No, because the amount in controversy is only $80,000.

• No, because the case lacks a federal question.

• No, because there is no diversity of citizenship federal jurisdiction.

• Yes, becasue the case presents a constitutional question.