What makes a case go to federal court is one of a short list of qualifying conditions: the lawsuit arises under federal law, the parties live in different states and more than $75,000 is at stake, the United States is a party, or the dispute falls into a narrower category the Constitution assigns to federal courts, like admiralty or cases between states. Federal courts have limited jurisdiction. If a case doesn’t fit one of those boxes, the court has no power to hear it.
Cases That Arise Under Federal Law
The widest door into federal court is called federal question jurisdiction. A federal district court can hear any civil action arising under the U.S. Constitution, a federal statute, or a treaty.1Office of the Law Revision Counsel. 28 U.S. Code 1331 – Federal Question The phrase “arises under” does real work. The federal issue has to be part of the plaintiff’s own claim, not just something the defendant plans to argue in response. Suing an officer for violating your constitutional rights is a federal question from the first page of the complaint. Suing someone for breach of contract when they intend to defend by pointing to a federal regulation is not.
Civil rights cases are the most familiar example. Employment discrimination under federal statutes, excessive-force claims against police, and constitutional challenges to government policies all land in federal district court. Patent and copyright cases go there too, and state courts can’t hear them at all.2GovInfo. 28 U.S. Code 1338 – Patents, Plant Variety Protection, Copyrights, Mask Works, Designs, Trademarks, and Unfair Competition Trademark claims can go either way depending on whether they’re grounded in federal or state law. Bankruptcy sits exclusively in federal court as well.3Office of the Law Revision Counsel. 28 U.S. Code 1334 – Bankruptcy Cases and Proceedings
Federal criminal prosecutions belong in this category. Counterfeiting, immigration offenses, interstate drug trafficking, securities fraud, and crimes committed on federal property are tried in federal court by U.S. Attorneys. One feature sets federal question cases apart from diversity cases: there is no minimum dollar amount.1Office of the Law Revision Counsel. 28 U.S. Code 1331 – Federal Question A constitutional claim worth a few hundred dollars still qualifies.
Cases Between Citizens of Different States
Federal courts also hear cases that have nothing to do with federal law, as long as the parties are from different states and the amount at stake is large enough. This is diversity jurisdiction, and the point of it is to shield out-of-state litigants from the risk of home-court bias. Two conditions must both be satisfied.4Office of the Law Revision Counsel. 28 U.S. Code 1332 – Diversity of Citizenship; Amount in Controversy; Costs
The first is complete diversity. No plaintiff can share a state with any defendant. A Florida plaintiff suing a Georgia driver has diversity. Add a second defendant who also lives in Florida and diversity collapses. The second condition is that the amount in controversy must exceed $75,000, not counting interest and costs. “Exceeds” is strict, so a claim for exactly $75,000 doesn’t make it. Courts generally accept the plaintiff’s stated amount unless the case clearly could not be worth that much. Unrelated claims against the same defendant can be added together to clear the threshold, but you can’t stack different legal theories for the same injury to inflate the number. A $40,000 totaled car is a $40,000 case no matter how many ways you plead the negligence.
Where Businesses Are Citizens
Individual citizenship usually comes down to where someone is domiciled. Businesses are more complicated, and the rule depends on the entity type. A corporation is a citizen of every state where it is incorporated and the state of its principal place of business.4Office of the Law Revision Counsel. 28 U.S. Code 1332 – Diversity of Citizenship; Amount in Controversy; Costs A company incorporated in Delaware with headquarters in Texas is a citizen of both.
LLCs, partnerships, and other unincorporated entities follow a very different rule that catches many litigants off guard. These entities take on the citizenship of every one of their members. An LLC with five members in five states is a citizen of all five. If one member shares a state with an opposing party, diversity is destroyed. When a member is itself an LLC, you have to trace citizenship down through every layer. This is one of the most common reasons diversity jurisdiction fails in practice.
Family Law and Probate Stay in State Court
Even when diversity and the dollar threshold are met, federal courts will not take certain kinds of cases. Under the domestic relations exception, they will not grant divorces, order alimony, or decide custody.5Legal Information Institute. Ankenbrandt v. Richards, 504 U.S. 689 (1992) A tort claim between former spouses can still go to federal court as long as the court doesn’t have to decide family law issues to resolve it. A parallel probate exception keeps federal courts out of probating wills and administering estates, though the Supreme Court has narrowed it: federal courts cannot take control of property already in a state probate court’s custody, but they can hear related disputes, like a claim that someone wrongfully took estate assets.6Library of Congress. Marshall v. Marshall, 547 U.S. 293 (2006)
Class Actions Have Their Own Rules
Class actions get into federal court under a different standard. Under the Class Action Fairness Act, a class action qualifies if the total amount in controversy exceeds $5,000,000 and at least one class member is a citizen of a state different from any defendant.4Office of the Law Revision Counsel. 28 U.S. Code 1332 – Diversity of Citizenship; Amount in Controversy; Costs That is only minimal diversity, not complete diversity, and the dollar threshold is calculated across the entire class instead of per plaintiff. That’s why consumer cases involving thousands of people with small individual claims routinely end up in federal court.
Cases Involving the United States
Some cases go to federal court because of who the parties are rather than what law is involved. The Constitution extends federal judicial power to any case in which the United States is a party, cases involving foreign ambassadors and other diplomatic personnel, and disputes between states.7Constitution Annotated. U.S. Constitution Article III, Section 2
Lawsuits brought by the federal government, whether enforcing regulations, pursuing fraud, or prosecuting crimes, are heard in federal court. Suits against the government go there too, but actually suing the United States is harder than most people realize. The government has sovereign immunity, which means you can’t sue it unless it has consented. For injury and property damage caused by federal employees acting within the scope of their jobs, Congress has waived that immunity through the Federal Tort Claims Act.8Office of the Law Revision Counsel. 28 U.S. Code 1346 – United States as Defendant
The FTCA has a strict prerequisite that trips up a lot of claimants. You have to file an administrative claim with the responsible federal agency before you can file a lawsuit.9Office of the Law Revision Counsel. 28 U.S. Code 2675 – Disposition by Federal Agency as Prerequisite; Evidence The claim has to be in writing and submitted within two years of the injury.10Office of the Law Revision Counsel. 28 U.S. Code 2401 – Time for Commencing Action Against United States If the agency denies the claim or lets six months pass without responding, you then have six months to sue in federal district court. Skip the administrative step and a court will dismiss the case.
Cases involving foreign ambassadors and consuls are federal because of their international character. The Supreme Court has original jurisdiction over them, though Congress has also given lower federal courts authority to hear some. Disputes between two or more states, like border and water-rights fights, go directly to the Supreme Court.7Constitution Annotated. U.S. Constitution Article III, Section 2
Admiralty and Maritime Cases
Disputes tied to navigable waters, including shipping accidents, cargo damage, injuries to crew, and maritime commerce, fall under federal admiralty jurisdiction. Federal district courts have original jurisdiction, and certain proceedings, such as seizing a vessel to satisfy a claim, can only happen in federal court.11Office of the Law Revision Counsel. 28 U.S. Code 1333 – Admiralty, Maritime and Prize Cases A “saving to suitors” clause preserves the right to pursue common-law remedies in state court when they’re available. In practice, personal injury claims from boating accidents often end up in state court, while contract disputes over cargo and claims against the vessel itself stay in federal court.
How State Claims Can Come Along
Real disputes rarely split cleanly into one legal theory. A single car accident might involve a federal civil rights claim against an officer and a state-law negligence claim against another driver. Supplemental jurisdiction lets a federal court hear state-law claims that are closely related to a federal claim already before it.12Office of the Law Revision Counsel. 28 U.S. Code 1367 – Supplemental Jurisdiction The claims must form part of the same case or controversy, meaning they grow out of the same set of facts. A federal court isn’t required to take the state claims. Judges can decline if the state claim raises a novel question of state law, if the state claims dominate the case, or if every federal claim has already been dismissed. When that happens, the state claims typically get refiled in state court, and the statute of limitations has to be watched carefully.
Moving a Case From State Court to Federal Court
A case doesn’t have to start in federal court to end up there. If a plaintiff files in state court but the case meets the requirements for federal jurisdiction, the defendant can remove it to federal court.13Office of the Law Revision Counsel. 28 U.S. Code 1441 – Removal of Civil Actions Only defendants can remove. Plaintiffs chose state court and are stuck with it unless the defendant acts. The case moves to the federal district court covering the same area as the state court.
The notice of removal has to be filed within 30 days of being served with the complaint, and when there are multiple defendants, all of them must join or consent.14Office of the Law Revision Counsel. 28 U.S. Code 1446 – Procedure for Removal of Civil Actions Diversity-based removal has two extra limits. A defendant who is a citizen of the state where the suit was filed cannot remove on diversity grounds, because the whole point of diversity jurisdiction is to protect out-of-state parties. And diversity-based removal is barred once a case has been pending more than one year, unless the court finds the plaintiff deliberately manipulated the case to prevent removal.
If the removal was improper, the plaintiff can move to send the case back. Procedural defects have to be raised within 30 days, but a lack of subject-matter jurisdiction can send the case back at any time before final judgment.15Office of the Law Revision Counsel. 28 U.S. Code 1447 – Procedure After Removal Generally A court that sends the case back can also order the removing party to pay the plaintiff’s costs and attorney fees.