Federal Question Jurisdiction vs. Diversity Jurisdiction
A detailed comparison of these two civil procedure rules, including key differences, exam strategies, and guidance on when to apply each.
Overview
Federal question jurisdiction and diversity jurisdiction are the two primary bases for original subject matter jurisdiction in federal courts, codified in 28 U.S.C. Sections 1331 and 1332, respectively. They serve different purposes and have different requirements, but both must be established for a federal court to hear a case (unless another basis of jurisdiction applies).
Federal question jurisdiction under Section 1331 extends to cases "arising under" the Constitution, laws, or treaties of the United States. Under the well-pleaded complaint rule from Louisville & Nashville Railroad v. Mottley (1908), the federal question must appear on the face of the plaintiff's complaint as part of the cause of action, not merely as an anticipated defense. There is no amount-in-controversy requirement for federal question jurisdiction. The Grable test provides a narrow exception for state-law claims that necessarily raise a disputed and substantial federal issue.
Diversity jurisdiction under Section 1332 requires complete diversity of citizenship between all plaintiffs and all defendants, plus an amount in controversy exceeding $75,000. Complete diversity means no plaintiff can be a citizen of the same state as any defendant (Strawbridge v. Curtiss). For individuals, citizenship is determined by domicile. For corporations, citizenship exists in both the state of incorporation and the state of the principal place of business (the "nerve center" under Hertz Corp. v. Friend). Diversity jurisdiction reflects the Framers' concern about state court bias against out-of-state litigants.
Key Differences
| Aspect | Federal Question Jurisdiction | Diversity Jurisdiction |
|---|---|---|
| Constitutional/statutory basis | Article III, Section 2; 28 U.S.C. Section 1331 | Article III, Section 2; 28 U.S.C. Section 1332 |
| Core requirement | Claim must arise under federal law (well-pleaded complaint rule) | Complete diversity of citizenship plus amount in controversy over $75,000 |
| Amount in controversy | No amount-in-controversy requirement | Must exceed $75,000, exclusive of interest and costs |
| Policy rationale | Federal courts should interpret and apply federal law | Protect out-of-state litigants from potential local bias |
| Applicable law | Federal substantive law governs the claim | Erie doctrine: state substantive law, federal procedural law |
Exam Tips
On a civil procedure exam, analyze both bases of jurisdiction whenever a case is filed in federal court. Start with federal question jurisdiction by examining the well-pleaded complaint: does the plaintiff's cause of action arise under federal law? If not, check for diversity jurisdiction: are the parties completely diverse and is the amount in controversy met? A classic trap is a federal defense: the fact that the defendant will raise a federal defense does not create federal question jurisdiction (Mottley). For diversity, watch for a plaintiff and defendant who share citizenship, as this destroys complete diversity. Also remember that corporate dual citizenship can create traps when a corporation is incorporated in one state but headquartered in another.
When to Apply Which
Apply federal question jurisdiction when the plaintiff's claim is based on federal law (federal statute, constitutional provision, or treaty). Apply diversity jurisdiction when the case involves state law claims but the parties are citizens of different states and the amount exceeds $75,000. In many cases, both may apply, but you should analyze each independently. If neither applies, the case must be in state court (unless another basis like supplemental jurisdiction supports a related claim).