A plaintiff, who resides in State A, files a lawsuit in federal court against a defendant, a corporation incorporated in State B with its principal place of business in State A. The plaintiff asserts a state-law breach of contract claim and seeks $300,000 in damages. Does the federal court have subject-matter jurisdiction over this case?
No, the federal court does not have subject-matter jurisdiction because breach of contract cases do not involve federal questions.
Yes, the federal court has subject-matter jurisdiction because the amount in controversy exceeds $75,000.
Yes, the federal court has subject-matter jurisdiction because the defendant is incorporated in a different state than the plaintiff’s residence.
No, the federal court does not have subject-matter jurisdiction because the defendant and the plaintiff are citizens of the same state for diversity purposes.
The federal court does not have subject-matter jurisdiction over this case because diversity jurisdiction requires complete diversity between the parties, meaning no plaintiff may be a citizen of the same state as any defendant. An individual is a citizen of the state of their domicile, and a corporation is a citizen of both its state of incorporation and the state where it has its principal place of business. Here, the corporation’s principal place of business is in State A, which defeats complete diversity with the plaintiff, also a resident of State A. Additionally, the case does not involve a federal question as it solely involves a state-law breach of contract claim.
Ask Bash
Bash is our AI bot, trained to help you pass your exam. AI Generated Content may display inaccurate information, always double-check anything important.
What does 'complete diversity' mean in legal terms?
Open an interactive chat with Bash
How is a corporation's citizenship determined for jurisdiction purposes?
Open an interactive chat with Bash
What are the requirements for a federal court to have subject-matter jurisdiction?