SMJ Attack Plan

● no matter what, define SMJ, FJ and DJ

o Subject matter jurisdiction can be granted through federal question jurisdiction or diversity
jurisdiction.
o Federal question jurisdiction provides district courts with original jurisdiction of all civil actions
arising under the Constitution, laws, or treaties of the United States.
o Diversity jurisdiction is present when the matter in controversy exceeds the sum of 75k and has
complete diversity.

o If the hypo is for FJ:

▪ A case arises under federal law if it is apparent from the face of the complaint that either
the cause of action:
● was created by federal law; or
● is based on state law but a federal law is a substantial part of the claim.
▪ The SC has held that a district court has jurisdiction only when the federal question is
clear on the face of the complaint
● Well Plead Complaint Rule
o Cannot advance a defense based on federal law
o Cannot rely on counterclaims
● Artful Pleading Rule
o A plaintiff cannot avoid removal to federal courts by declining to plead
federal questions

o If the hypo is for DJ:

▪ No DJ for claims on
● Probate
● Domestic (divorce, alimony and custody)
● In rem actions
▪ Amount in Controversy (75k):
● Aggregation of Claims
o Single plaintiff and Single Defendant = DJ
o Single plaintiff and multi Defendant = NO; unless defendants are jointly
liable
o Multi plaintiff = NO
▪ Complete Diversity – no party on one side may be a citizen of the same state as a party
on the other side. This is determined at the time the claim is filed.
● Determining Citizenship:
o Citizenship of individuals is determined by their domicile.
▪ Domicile is the place a person has her true, fixed and permanent
home and to which the person has the intention of returning when
absent therefrom.
▪ Domicile is not lost until a new one is gained.
o Corporations’ citizenship is determined by the state in which they are
incorporated along with the state in which it has its principal place of
business.
▪ A principal place of business is the place where high level officers
direct, control and coordinates the activities of the corporation.

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 o Unincorporated Associations are treated as a collection of individuals and
its citizenship will be the same as the citizenship of all of its members.

o Supplemental Jurisdiction
▪ Supplemental jurisdiction stretches federal jurisdiction to cover claims that, if brought
independently would not fit within the district court’s SMJ.
▪ Supplemental jurisdiction authorizes the court to hear all other claims in the action that
arises out of the same nucleus of operative facts as the original claim that confers original
jurisdiction
▪ Exceptions:
● Actions solely on diversity and additional claim brought by plaintiff against:
o Permissive parties (rule 20)
o Intervening parties (rule 24)
o Necessary parties (rule 19)
o Third parties (rule 14)
● Actions solely on diversity brought by
o persons proposed to be joined as plaintiffs under Rule 19
o seeking to intervene as plaintiff under Rule 24
o Class Actions:
▪ District courts may still have subject matter jurisdiction regarding class actions which do
not invoke federal question jurisdiction through diversity jurisdiction or through the Class
Action Fairness Act (CAFA) of 2005.
▪ CAFA requires the class size to involve one hundred members or more, have minimal
diversity and have a total aggregated value of all claims exceed five million dollars.
● Minimal diversity is met if any member of a class of plaintiffs is a citizen of a
state different from any defendant or if any member of a class of plaintiffs is a
foreign state or a citizen of a foreign state or any defendant of a foreign state or
vise versa
o Permissive Joinder – Rule 20
▪ Joined party must have a right arising out of the same transaction or occurrence, and
● All parties joined must share in common at least one question of law/fact
● Joinder can be denied if it will produce jury confusion or undue delay
o Counterclaim & Cross-Claim – Rule 13
▪ Compulsory Counterclaim 13(a)
● a claim against an opposing party that arises from the same transaction or
occurrence that gave rise to the plaintiff’s complaint.
● Compulsory counterclaims must be asserted or they are waived.
▪ Permissive Counterclaim 13(b)
● a claim against an opposing party that does not arise out of the transaction or
occurrence that is the subject matter of the opposing party’s claim.
● It could also be a claim that arises out of the same transaction but that falls under
an exception to the compulsory counterclaim rule
o (1) Immature claim;
o (2) Claim arose after party holding counterclaim filed a responsive
pleading;
o (3) Claim requires joinder of some third party who is not subject to the
court’s jurisdiction;
o (4) Claim is subject to pending litigation;
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 o (5) Quasi In Rem/In Rem Jurisdiction actions; and
o (6) Injunction/Declaratory Judgment Actions
▪ Cross-Claim 13(g)
● Permits persons who are already parties to a suit to bring related claims against
persons on the same side of the litigation.
● These claims are typically raised in a responsive pleading.
● They must arise out of the same transaction or occurrence as the original action or
relate to the same property that is in dispute in the original action.
▪ Both counterclaims and cross-claims must meet the standards of either federal question
jurisdiction, diversity jurisdiction, or supplemental jurisdiction.
▪ Supplemental jurisdiction is normally present for cross-claims and compulsory
counterclaims but is frequently not available for permissive counterclaim.
● Why?
o Permissive counterclaims do not arise from the same transaction but
permissive cross-claims do!
o Impleader – Rule 14
▪ The key difference between Rule 13(g) Cross-Claims and Rule 14 Impleader is that when
using Rule 13(g) a party already in the suit is suing another party in the suit; but Rule 14
allows a party already in the suit to bring someone not currently in the suit into the
litigation.
▪ Rule 14(a) describes the power of defendants to implead third parties. A third-party
defendant is joined upon service of a proper summons and third-party complaint.
▪ Rule 14(b) provides that if a plaintiff is the subject of a counterclaim, the plaintiff may
join third parties who may be liable for part or all of that claim, in the same manner that
Rule 14(a) authorizes defendants to join third parties.

o Intervention – Rule 24 govern when non-parties may come into an existing suit
▪ Intervention of Right –Rule 24(a)
● A person shall be permitted to intervene in an action:
o (1) when a statute of the U.S. confers an unconditional right to intervene;
or
o (2) when the applicant claims an interest relating to the property or
transaction which is the subject of the action and the applicant is so
situated that the disposition of the action may as a practical matter impair
or impede the applicant’s ability to protect that interest, unless the
applicant’s interest is adequately represented by existing parties.
▪ Permissive Intervention – Rule 24(b)
● A person may be permitted to intervene in an action:
o (1) when a statute of the U.S. confers a conditional right to intervene; or
o (2) when the applicant’s claim or defense and the main action have a
question of law or fact in common
● Klaxon case: Choice of Law/Conflict of Law
o Under Erie and the Federal Rules of Decision Act, §1651, a federal court must apply the same
substantive state law in interpreting state-law issues in a diversity case that would be used by the
state supreme court in the state where the federal court is located.

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