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10 Cards in this Set

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Osborn v. Bank of US (1824)

J. Marshall: "arising under" in Article III, s. 2 requires for federal law to be an "ingredient" of the case. Article III does not create lower federal courts and does not confer SMJ on the lower federal cours. It authorizes Congress to do both.

Louisville v. Mottley (1908)

well-pleaded complaint rule

Facts: π: RR breached K for lifetime pass to free train travel. ∆: Federal § disallows free passes

Holding: No federal jurisdiction. For § arising under jurisdiction, claim must arise under federal law. π must raise the federal issue in a complaint which includes the elements she needs to prove to establish her claim, and only those elements.

American Well Works v. Layne (1916)


Holmes Test

Facts: Libel related to a patent

Holding: No federal jurisdiction. A suit arises under the law that creates the cause of action. Requires that (1) federal law creates the underlying substantive right the π seeks to enforce, and (2) authorizes the π to bring suit to enforce that substantive right

Smith v. Kansas City Title & Trust (1920)

the exception

(compare with Moore v. Chesapeake (1934)).

Issue: Shareholder suit. Unconstitutional § that uathorizes bonds.

Holding: Federal Jurisdiction. Cause of action necessarily turns on federal law. Federal issue is embedded in state law claim and essential to its resolution.

Holmes dissent: doesn't satisfy American Well and Holmes test.

Moore v. Chesapeake (1934)

Facts: worker's compensation; prove employer liability using federal safety standard to preclude a defense (but: federal law not central to cause of action).

Holding: No federal jurisdiction. Federal statute does not authorize individual cause of action. Cause of action lies in state law. =/= Smith

Merrell Dow v. Thompson (1986)

Four factor test to imply federal cause of action

Facts: Drug tort liability for birth defects. Complaint alleged a state cause of action (negligence) but asserted that the π could prove this state cause of action by showing aviolation of the substantive standard governing warnings in the §.

Holding: No federal jurisdiction. State law creates cause of action. Reaffirms Mottley's well pleaded complaint rule. Four factor test:

(1) π is part of class for whose benefit § exists

(2) legislative intent to create cause of action;

(3) federal cause of action would further the purpose of legislation;

(4) cause of action concerns a subject that is traditionally federal law subject.

Strawbridge v. Curtis (1806)

Diversity under § 1331 requires complete diversity. This means all persons on one side of v. must be different from persons on the other side of v.

If non-diverse defendant is added later: court will likely deny the amended complaint or dismiss the complaint.

Holmes v. Sopuch (1981)

Facts: medical malpractice tort claim

Holding: no diversity. Student did not establish domicile when he stayed in Ohio only for the duration of his studies. Has to show intent to stay in Ohio indefinitely. Residing in the state is not enough.

Two prong test for state citizenship:

(1) physical presence;

(2) intention to remain indefinitely

Similar: subjective intent to stay indefinitely is necessary but not sufficient: has to physically arrive there to stay.

Bair v. Peck (1990)

opposite of Holmes.

Facts: medical malpractice, student.

Holding: Not a resident of CO even though student establishes domicile in CO by filing state tax return and job. Returned to KS for medical treatment. Drivers license, pers. prop., and voter reg. in CO.

Egan v. American Air (1963)

Nerve center (corporate HQ)

Facts: wrongful death due to an airline crash

Holding: aside from the state of incorporation, court looks at airline company's residency based on the "nerve center" theory. Where do the executives work and make policy.