Subject Matter Jurisdiction

Subject matter jurisdiction refers to the court’s authority to hear the case. Federal courts are courts of limited jurisdiction. For a federal court to hear a case, there must be a showing that the court has authority over the lawsuit.

There are two main avenues of subject matter jurisdiction: (1) federal question; and (2) diversity. A federal court has federal question jurisdiction when the claim arises out of the laws or Constitution of the United States (based on the plaintiff’s well-pleaded complaint – anticipated affirmative defenses based on federal law do not count).

A federal court has diversity jurisdiction if (1) there is complete diversity among all plaintiffs and defendants (meaning that no plaintiff can be a domiciliary of the same state as any defendant); and (2) the amount in controversy (as pled in good faith in the plaintiff’s complaint) exceeds $75,000. Know when a plaintiff or plaintiffs are permitted to aggregate their claims to satisfy the amount in controversy element.

NOTE: This flow chart does not cover the subject matter jurisdiction of state courts, which are courts of general jurisdiction.