§1332 — Title 28 Judiciary and Judicial Procedure | U.S. Code

Summary

Federal district courts can hear civil cases when the amount in dispute is more than $75,000 (not counting interest or court costs) and the parties are from different places. That includes fights between people from different states, between a U.S. state citizen and a foreign citizen (but not when both are lawful permanent residents living in the same state), cases with both U.S. and foreign parties, and cases where a foreign government sues U.S. citizens. A corporation counts as a citizen of the state where it was formed and the state where it has its main office. An insurer sued directly (when the insured is not a defendant) is treated as a citizen of the insured’s states, the states where the insurer was formed, and where it has its main office. A personal representative is treated as a citizen of the same state as the person they represent. Federal courts can also hear class actions when the total claims of the class exceed $5,000,000 (not counting interest or costs) and at least one class member is from a different state than any defendant, or when foreign parties are involved. The court can refuse to take a case when between one-third and two-thirds of the class and the main defendants are citizens of the state where the case was filed, based on factors like whether the case raises national issues, what law applies, and whether filing was meant to avoid federal court. The court must refuse in certain situations when more than two-thirds (or two-thirds or more) of the class and key defendants are citizens of the filing state and the main injuries happened there, or if similar class suits were not filed in the prior three years. These class rules do not apply if the main defendants are states or if the class has fewer than 100 members. All class members’ claims are added together to see if they meet the $5,000,000 threshold. A “class,” “class action,” “class certification order,” “class members,” “unincorporated association,” and “mass action” are defined in the law. A mass action with 100 or more plaintiffs can be treated like a class action for removal in some cases, but only plaintiffs who meet the usual dollar requirements count, and there are limits on transfer and some exceptions. The word “States” includes U.S. territories, D.C., and Puerto Rico.

Title 28, §1332

Judiciary and Judicial Procedure — Source: USLM XML via OLRC

(a)The district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between—

(1)citizens of different States;

(2)citizens of a State and citizens or subjects of a foreign state, except that the district courts shall not have original jurisdiction under this subsection of an action between citizens of a State and citizens or subjects of a foreign state who are lawfully admitted for permanent residence in the United States and are domiciled in the same State;

(3)citizens of different States and in which citizens or subjects of a foreign state are additional parties; and

(4)a foreign state, defined in section 1603(a) of this title, as plaintiff and citizens of a State or of different States.

(b)Except when express provision therefor is otherwise made in a statute of the United States, where the plaintiff who files the case originally in the Federal courts is finally adjudged to be entitled to recover less than the sum or value of $75,000, computed without regard to any setoff or counterclaim to which the defendant may be adjudged to be entitled, and exclusive of interest and costs, the district court may deny costs to the plaintiff and, in addition, may impose costs on the plaintiff.

(c)For the purposes of this section and section 1441 of this title—

(1)a corporation shall be deemed to be a citizen of every State and foreign state by which it has been incorporated and of the State or foreign state where it has its principal place of business, except that in any direct action against the insurer of a policy or contract of liability insurance, whether incorporated or unincorporated, to which action the insured is not joined as a party-defendant, such insurer shall be deemed a citizen of—

(A)every State and foreign state of which the insured is a citizen;

(B)every State and foreign state by which the insurer has been incorporated; and

(C)the State or foreign state where the insurer has its principal place of business; and

(2)the legal representative of the estate of a decedent shall be deemed to be a citizen only of the same State as the decedent, and the legal representative of an infant or incompetent shall be deemed to be a citizen only of the same State as the infant or incompetent.

(d)(1)In this subsection—

(A)the term “class” means all of the class members in a class action;

(B)the term “class action” means any civil action filed under rule 23 of the Federal Rules of Civil Procedure or similar State statute or rule of judicial procedure authorizing an action to be brought by 1 or more representative persons as a class action;

(C)the term “class certification order” means an order issued by a court approving the treatment of some or all aspects of a civil action as a class action; and

(D)the term “class members” means the persons (named or unnamed) who fall within the definition of the proposed or certified class in a class action.

(2)The district courts shall have original jurisdiction of any civil action in which the matter in controversy exceeds the sum or value of $5,000,000, exclusive of interest and costs, and is a class action in which—

(A)any member of a class of plaintiffs is a citizen of a State different from any defendant;

(B)any member of a class of plaintiffs is a foreign state or a citizen or subject of a foreign state and any defendant is a citizen of a State; or

(C)any member of a class of plaintiffs is a citizen of a State and any defendant is a foreign state or a citizen or subject of a foreign state.

(3)A district court may, in the interests of justice and looking at the totality of the circumstances, decline to exercise jurisdiction under paragraph (2) over a class action in which greater than one-third but less than two-thirds of the members of all proposed plaintiff classes in the aggregate and the primary defendants are citizens of the State in which the action was originally filed based on consideration of—

(A)whether the claims asserted involve matters of national or interstate interest;

(B)whether the claims asserted will be governed by laws of the State in which the action was originally filed or by the laws of other States;

(C)whether the class action has been pleaded in a manner that seeks to avoid Federal jurisdiction;

(D)whether the action was brought in a forum with a distinct nexus with the class members, the alleged harm, or the defendants;

(E)whether the number of citizens of the State in which the action was originally filed in all proposed plaintiff classes in the aggregate is substantially larger than the number of citizens from any other State, and the citizenship of the other members of the proposed class is dispersed among a substantial number of States; and

(F)whether, during the 3-year period preceding the filing of that class action, 1 or more other class actions asserting the same or similar claims on behalf of the same or other persons have been filed.

(4)A district court shall decline to exercise jurisdiction under paragraph (2)—

(A)(i)over a class action in which—

(I)greater than two-thirds of the members of all proposed plaintiff classes in the aggregate are citizens of the State in which the action was originally filed;

(II)at least 1 defendant is a defendant—

(aa)from whom significant relief is sought by members of the plaintiff class;

(bb)whose alleged conduct forms a significant basis for the claims asserted by the proposed plaintiff class; and

(cc)who is a citizen of the State in which the action was originally filed; and

(III)principal injuries resulting from the alleged conduct or any related conduct of each defendant were incurred in the State in which the action was originally filed; and

(ii)during the 3-year period preceding the filing of that class action, no other class action has been filed asserting the same or similar factual allegations against any of the defendants on behalf of the same or other persons; or

(B)two-thirds or more of the members of all proposed plaintiff classes in the aggregate, and the primary defendants, are citizens of the State in which the action was originally filed.

(5)Paragraphs (2) through (4) shall not apply to any class action in which—

(A)the primary defendants are States, State officials, or other governmental entities against whom the district court may be foreclosed from ordering relief; or

(B)the number of members of all proposed plaintiff classes in the aggregate is less than 100.

(6)In any class action, the claims of the individual class members shall be aggregated to determine whether the matter in controversy exceeds the sum or value of $5,000,000, exclusive of interest and costs.

(7)Citizenship of the members of the proposed plaintiff classes shall be determined for purposes of paragraphs (2) through (6) as of the date of filing of the complaint or amended complaint, or, if the case stated by the initial pleading is not subject to Federal jurisdiction, as of the date of service by plaintiffs of an amended pleading, motion, or other paper, indicating the existence of Federal jurisdiction.

(8)This subsection shall apply to any class action before or after the entry of a class certification order by the court with respect to that action.

(9)Paragraph (2) shall not apply to any class action that solely involves a claim—

(A)concerning a covered security as defined under 16(f)(3) 11 So in original. Probably should be preceded by “section”. of the Securities Act of 1933 (15 U.S.C. 78p(f)(3) 22 So in original. Probably should be “77p(f)(3)”.) and section 28(f)(5)(E) of the Securities Exchange Act of 1934 (15 U.S.C. 78bb(f)(5)(E));

(B)that relates to the internal affairs or governance of a corporation or other form of business enterprise and that arises under or by virtue of the laws of the State in which such corporation or business enterprise is incorporated or organized; or

(C)that relates to the rights, duties (including fiduciary duties), and obligations relating to or created by or pursuant to any security (as defined under section 2(a)(1) of the Securities Act of 1933 (15 U.S.C. 77b(a)(1)) and the regulations issued thereunder).

(10)For purposes of this subsection and section 1453, an unincorporated association shall be deemed to be a citizen of the State where it has its principal place of business and the State under whose laws it is organized.

(11)(A)For purposes of this subsection and section 1453, a mass action shall be deemed to be a class action removable under paragraphs (2) through (10) if it otherwise meets the provisions of those paragraphs.

(B)(i)As used in subparagraph (A), the term “mass action” means any civil action (except a civil action within the scope of section 1711(2)) in which monetary relief claims of 100 or more persons are proposed to be tried jointly on the ground that the plaintiffs’ claims involve common questions of law or fact, except that jurisdiction shall exist only over those plaintiffs whose claims in a mass action satisfy the jurisdictional amount requirements under subsection (a).

(ii)As used in subparagraph (A), the term “mass action” shall not include any civil action in which—

(I)all of the claims in the action arise from an event or occurrence in the State in which the action was filed, and that allegedly resulted in injuries in that State or in States contiguous to that State;

(II)the claims are joined upon motion of a defendant;

(III)all of the claims in the action are asserted on behalf of the general public (and not on behalf of individual claimants or members of a purported class) pursuant to a State statute specifically authorizing such action; or

(IV)the claims have been consolidated or coordinated solely for pretrial proceedings.

(C)(i)Any action(s) removed to Federal court pursuant to this subsection shall not thereafter be transferred to any other court pursuant to section 1407, or the rules promulgated thereunder, unless a majority of the plaintiffs in the action request transfer pursuant to section 1407.

(ii)This subparagraph will not apply—

(I)to cases certified pursuant to rule 23 of the Federal Rules of Civil Procedure; or

(II)if plaintiffs propose that the action proceed as a class action pursuant to rule 23 of the Federal Rules of Civil Procedure.

(D)The limitations periods on any claims asserted in a mass action that is removed to Federal court pursuant to this subsection shall be deemed tolled during the period that the action is pending in Federal court.

(e)The word “States”, as used in this section, includes the Territories, the District of Columbia, and the Commonwealth of Puerto Rico.

Notes & Related Subsidiaries

Historical and Revision Notes

Based on title 28, U.S.C., 1940 ed., § 41(1) (Mar. 3, 1911, ch. 231, § 24, par. 1, 36 Stat. 1091;

May 14, 1934, ch. 283, § 1, 48 Stat. 775; Aug. 21, 1937, ch. 726, § 1, 50 Stat. 738; Apr. 20, 1940, ch. 117, 54 Stat. 143). Other provisions of section 41(1) of title 28, U.S.C., 1940 ed., are incorporated in section 1331, 1341, 1342, 1345, 1354, and 1359 of this title. (See reviser’s notes under said sections.) Jurisdiction conferred by other sections of this chapter, except section 1335, is not dependent upon diversity of citizenship. (See annotations under former section 41 of title 28, U.S.C.A., and 35 C.J.S., p. 833 et seq. §§ 30–43. See, also, reviser’s note under section 1331 of this title.) As to citizenship of bank where jurisdiction depends upon diversity of citizenship, see section 1348 of this title. Words “all civil actions” were substituted for “all suits of a civil nature, at common law or in equity” in order to conform to Rule 2 of the Federal Rules of Civil Procedure. Words “or citizens of the District of Columbia, Territory of Hawaii, or Alaska, and any State or Territory” which were inserted by the amendatory act

April 20, 1940, are omitted. The word “States” is defined in this section and enumeration of the references is unnecessary. The revised section conforms with the views of Philip F. Herrick, United States Attorney, Puerto Rico, who observed that the act of

April 20, 1940, permitted action between a citizen of Hawaii and of Puerto Rico, but not between a citizen of New York and Puerto Rico, in the district court. This changes the law to insure uniformity. The 1940 amendment applied only to the provision as to controversies between “citizens of different States.” The new definition in subsection (b) extends the 1940 amendment to apply to controversies between citizens of the Territories or the District of Columbia, and foreign states or citizens or subjects thereof. The diversity of citizenship language of section 41(1) of title 28, U.S.C., 1940 ed., as amended in 1940, was described as ambiguous in McGarry v. City of Bethlehem, 45 F.Supp. 385, 386. In that case the 1940 amendment was held unconstitutional insofar as it affected the District of Columbia. However, two other district courts upheld the amendment. Winkler v. Daniels, D.C.Va. 1942, 43 F.Supp. 265; Glaeser v. Acacia Mutual Life Ass’n., D.C.Cal. 1944, 55 F.Supp. 925. This section is intended to cover all diversity of citizenship instances in civil actions in accordance with the judicial

Construction

of the language in the original section 41(1) of title 28, U.S.C., 1940 ed. Therefore, the revised language covers civil actions between— Citizens of a State, and citizens of other States and foreign states or citizens or subjects thereof; Citizens of a Territory or the District of Columbia, and foreign states or citizens or subjects thereof; Citizens of different States; Citizens of different Territories; Citizens of a State, and citizens of Territories; Citizens of a State or Territory, and citizens of the District of Columbia; Citizens of a State, and foreign states or citizens or subjects thereof. The revised section removes an uncertainty referred to in the McGarry case, supra, as to whether Congress intended to permit citizens of the Territories or the District of Columbia to sue a State or Territory itself rather than the citizens thereof. The court observed that “Congress could hardly have had such intention.” The sentence “The foregoing provisions as to the sum or value of the matter in controversy shall not be construed to apply to any of the cases mentioned in the succeeding paragraphs of this section” was omitted as unnecessary. Those paragraphs are (2)–(28) of said section 41 of title 28, U.S.C., 1940 ed., which are revised and incorporated in this chapter and, except for those relating to actions against the United States and interpleader, contains no provision as to a sum or value necessary to confer jurisdiction. Consequently the omitted sentence is covered by excluding such requirement. section 41(1) of title 28, U.S.C., 1940 ed., as originally enacted, purported to include all jurisdictional provisions relating to the district courts. Subsequently, many special jurisdictional provisions were enacted and incorporated in other titles of the U.S.C., 1940 ed., as follows: Title section 7209 7210 7216 7292 7499g 7608a(6) 7608c(15)(B) 7610(b)(2) 7648 71175 71365—1367 71376 71508(c) 8164 8701 8903 94 98 99 1111(a) 1146 11205(a), (l) 11401 11511 11512 11514—516 11711 11712 11811 11812 111011 111012 111013 111200 1293 12195 12632 154 159 1515 1525 1526 1531 1553 1568e 1577t 1577v 1577vvv 1578u(e) 1578u(f) 1578aa 1579k(d), (e) 1579r(f), (g) 1580a–25 1580a–34 1580a–35 1580a–41(c), (e) 1580a–43 1580b–14 1597 1599 15433 15715d(c) 15715i 15717s 15717u 1610 16583e 16820 16825m 16825n 16825p 1726 1734 21193 21332 21355 25314 25345 263633 263800 27207 29101 29103—109 29160(e) 29216 29217 30188 31232 33495 33918 33921 3563 3566 3567 3572a 3590 38445 40257 40270b 40361 41113(b)(2) 42405(c)(5), (g) 43546 431062 4556 4588 4589 45153(p) 45159 45185 45228j(b)4 45228k 45268 45355(f) 46597 46688 46711 46741 et seq. 46781 et seq. 46941(c) 46951 46954 461114(c) 461128d 4711 4713 4733 4736 47207 47401 47406 47407 48242 48245 495(8) 499 4916(2) 4916(9) 4916(12) 4917(9) 4919a(l) 4920(9) 4923 4926(h) 4941(1), (3) 4943 49181(b), (c) 49305(g) 49322(b) 49647 49916 491017 491021 5023 D.C. Code11–305—11–307 D.C. Code11–309 D.C. Code11–324

Editorial Notes

References in Text

Rule 23 of the Federal Rules of Civil Procedure, referred to in subsec. (d)(1)(B), (11)(C)(ii), is set out in the Appendix to this title.

Amendments

2011—Subsec. (a). Pub. L. 112–63, § 101(1), struck out concluding provisions which read as follows: “For the purposes of this section, section 1335, and section 1441, an alien admitted to the United States for permanent residence shall be deemed a citizen of the State in which such alien is domiciled.” Subsec. (a)(2). Pub. L. 112–63, § 101(2), inserted before semicolon at end “, except that the district courts shall not have original jurisdiction under this subsection of an action between citizens of a State and citizens or subjects of a foreign state who are lawfully admitted for permanent residence in the United States and are domiciled in the same State”. Subsec. (c)(1). Pub. L. 112–63, § 102, substituted “every State and foreign state” for “any State”, “it has been incorporated and of the State or foreign state” for “it has been incorporated and of the State”, and “such insurer shall be deemed a citizen of—” for “such insurer shall be deemed a citizen of the State of which the insured is a citizen, as well as of any State by which the insurer has been incorporated and of the State where it has its principal place of business; and” and added subpars. (A) to (C). 2005—Subsecs. (d), (e). Pub. L. 109–2 added subsec. (d) and redesignated former subsec. (d) as (e). 1996—Subsecs. (a), (b). Pub. L. 104–317 substituted “$75,000” for “$50,000”. 1988—Subsec. (a). Pub. L. 100–702, § 201(a), substituted “$50,000” for “$10,000” in introductory text. Pub. L. 100–702, § 203(a), inserted at end “For the purposes of this section, section 1335, and section 1441, an alien admitted to the United States for permanent residence shall be deemed a citizen of the State in which such alien is domiciled.” Subsec. (b). Pub. L. 100–702, § 201(a), substituted “$50,000” for “$10,000”. Subsec. (c). Pub. L. 100–702, § 202(a), amended subsec. (c) generally. Prior to amendment, subsec. (c) read as follows: “For the purposes of this section and section 1441 of this title, a corporation shall be deemed a citizen of any State by which it has been incorporated and of the State where it has its principal place of business: Provided further, That in any direct action against the insurer of a policy or contract of liability insurance, whether incorporated or unincorporated, to which action the insured is not joined as a party-defendant, such insurer shall be deemed a citizen of the State of which the insured is a citizen, as well as of any State by which the insurer has been incorporated and of the State where it has its principal place of business.” 1976—Subsec. (a)(2). Pub. L. 94–583 substituted “and citizens or subjects of a foreign state;” for “, and foreign states or citizens or subjects thereof; and”. Subsec. (a)(3). Pub. L. 94–583 substituted “citizens or subjects of a foreign state are additional parties; and” for “foreign states or citizens or subjects thereof are additional parties”. Subsec. (a)(4). Pub. L. 94–583 added par. (4). 1964—Subsec. (c). Pub. L. 88–439 inserted proviso deeming an insurer of liability insurance, in an action to which the insurer is not joined as a party-defendant, a citizen, of the State of which the insured is a citizen, as well as the State the insurer has been incorporated by and the State where it has its principal place of business. 1958—Pub. L. 85–554 included costs in section catchline. Subsec. (a). Pub. L. 85–554 substituted “$10,000” for “$3,000”. Subsecs. (b) to (d). Pub. L. 85–554 added subsecs. (b) and (c) and redesignated former subsec. (b) as (d). 1956—Subsec. (b). Act July 26, 1956, included the Commonwealth of Puerto Rico.

Statutory Notes and Related Subsidiaries

Effective Date

of 2011 Amendment Pub. L. 112–63, title I, § 105, Dec. 7, 2011, 125 Stat. 762, provided that: “(a) In General.—Subject to subsection (b), the

Amendments

made by this title [enacting section 1455 of this title and amending this section and section 1441, 1446, and 1453 of this title] shall take effect upon the expiration of the 30-day period beginning on the date of the enactment of this Act [Dec. 7, 2011], and shall apply to any action or prosecution commenced on or after such

Effective Date

. “(b) Treatment of Cases Removed to Federal Court.—For purposes of subsection (a), an action or prosecution commenced in State court and removed to Federal court shall be deemed to commence on the date the action or prosecution was commenced, within the meaning of State law, in State court.”

Effective Date

of 2005 Amendment Pub. L. 109–2, § 9, Feb. 18, 2005, 119 Stat. 14, provided that: “The

Amendments

made by this Act [enacting chapter 114 and section 1453 of this title and amending this section and section 1335 and 1603 of this title] shall apply to any civil action commenced on or after the date of enactment of this Act [Feb. 18, 2005].”

Effective Date

of 1996 Amendment Pub. L. 104–317, title II, § 205(b), Oct. 19, 1996, 110 Stat. 3850, provided that: “The amendment made by this section [amending this section] shall take effect 90 days after the date of enactment of this Act [Oct. 19, 1996].”

Effective Date

of 1988 Amendment Pub. L. 100–702, title II, § 201(b), Nov. 19, 1988, 102 Stat. 4646, provided that: “The

Amendments

made by this section [amending this section] shall apply to any civil action commenced on or after the 180th day after the date of enactment of this title [Nov. 19, 1988].” Pub. L. 100–702, title II, § 202(b), Nov. 19, 1988, 102 Stat. 4646, provided that: “The amendment made by this section [amending this section] shall apply to any civil action commenced in or removed to a United States district court on or after the 180th day after the date of enactment of this title [Nov. 19, 1988].” Pub. L. 100–702, title II, § 203(b), Nov. 19, 1988, 102 Stat. 4646, provided that: “The amendment made by this section [amending this section] shall apply to claims in civil actions commenced in or removed to the United States district courts on or after the 180th day after the date of enactment of this title [Nov. 19, 1988].”

Effective Date

of 1976 AmendmentAmendment by Pub. L. 94–583 effective 90 days after Oct. 21, 1976, see section 8 of Pub. L. 94–583, set out as an

Effective Date

note under section 1602 of this title.

Effective Date

of 1964 Amendment Pub. L. 88–439, § 2, Aug. 14, 1964, 78 Stat. 445, provided that: “The amendment made by this Act to section 1332(c), title 28, United States Code, applies only to causes of action arising after the date of enactment of this Act [Aug. 14, 1964].”

Effective Date

of 1958 AmendmentAmendment by Pub. L. 85–554 applicable only in the case of actions commenced after July 25, 1958, see section 3 of Pub. L. 85–554, set out as a note under section 1331 of this title.

§1332 Diversity of citizenship; amount in controversy; costs

Summary

Title 28, §1332

Notes & Related Subsidiaries

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Construction

Editorial Notes

References in Text

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Statutory Notes and Related Subsidiaries

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Citations & Metadata