437 U.S. 365 (1978), Supreme Court of the United States
Often cited in Civil Procedure courses under the shorthand "Kroger v. Owen Equipment," this Supreme Court decision sharply delineates the limits of federal diversity jurisdiction when a plaintiff seeks to add claims against a third-party defendant brought into the case by the original defendant under Federal Rule of Civil Procedure 14.
In a diversity-only case, may a federal court exercise ancillary jurisdiction over a plaintiff's claim against a third-party defendant impleaded under Rule 14 when that claim would destroy complete diversity if brought independently?
Complete diversity is required in cases premised solely on 28 U.S.C. § 1332. Ancillary (now supplemental) jurisdiction cannot be used by a plaintiff to assert a claim against a nondiverse third-party defendant impleaded under Rule 14 when doing so would contravene the complete diversity requirement. The efficiencies of resolving factually related claims in a single action do not expand the statutory grant of federal subject-matter jurisdiction.
No. The district court lacked subject-matter jurisdiction over the plaintiff's direct claim against Owen because both were citizens of Iowa. Ancillary jurisdiction does not extend to a plaintiff's claim against a nondiverse third-party defendant in a diversity action. The judgment was reversed and the case remanded with instructions to dismiss for lack of jurisdiction.
This case is a bedrock authority on the limits of supplemental jurisdiction in diversity cases and directly prefigures 28 U.S.C. § 1367(b), which bars supplemental jurisdiction over certain claims by plaintiffs against parties joined under Rules 14, 19, 20, or 24 when jurisdiction is founded solely on diversity. For students, it clarifies why courts treat plaintiffs and defendants differently in the supplemental-jurisdiction analysis, how Rule 14 interacts with jurisdictional statutes, and why procedural efficiency never overrides the statutory prerequisites for federal jurisdiction.