1367 and the “contamination” rule

The Problem

Read the Exxon case in the casebook carefully, along with the notes for that case. The scenarios below are based on Exxon, and involve suits with multiple plaintiffs and one defendant. In these cases, joinder was made of multiple plaintiffs under Rule 20 (or of a class under Rule 23) and not required joinder under Rule 19. As a result, 1367(b) did not act to bar supplemental jurisdiction. That raises two questions:

Question 1 – non-diverse litigants: Does the existence of a non-diverse supplemental claim destroy the diversity jurisdiction of the original claim?

Example: PENNSYLVANIA and FLORIDA v. FLORIDA, each seeking $100K for a car accident.

Answer: Yes, it does. Original and supplemental jurisdiction are lacking. This supplemental claim of FL v. FL “contaminates” the original diversity SMJ of PA v. FL. Because the original SMJ of PA v. FL is contaminated, we don’t have original SMJ and also cannot have supplemental jurisdiction. See below. Put differently, the addition of a non-diverse supplemental litigant makes the ice cream inedible, destroying the original jurisdiction needed for supplemental jurisdiction. (See here for why supplemental jurisdiction is like an ice cream cone.)

Question 2 – amount in controversy woes: Does the existence of a supplemental claim lacking the AIC destroy the diversity jurisdiction of the original claim?

Example: PENNSYLVANIA and PENNSYLVANIA v. FLORIDA for a car accident. One plaintiff seeks $100K and the second seeks $10K.

Answer: No, it does not. This is just like the Star-Kist Tuna portion of Exxon. Original and supplemental jurisdiction are both ok. See below. According to Allapattah, adding a supplemental litigant lacking AIC does not “contaminate” the ice cream, and thus does not destroy the original jurisdiction needed for supplemental jurisdiction. (See here for why supplemental jurisdiction is like an ice cream cone.)

The Law

Lack of complete diversity: contamination. The Court held that incomplete diversity of citizenship between Ps and Ds would contaminate the original 1332 jurisdiction and would not be permitted. Is the complete diversity requirement more important than the amount in controversy requirement? Why or why not?

Lack of amount in controversy: no contamination. Exxon permitted SJ so long as at least one plaintiff satisfied the AIC, even if other plaintiffs did not. The Court held that SJ over the supplemental claims would not “contaminate” the original jurisdiction under 1332. Why? What was Kennedy’s reasoning? Are you persuaded?

Caveat to contamination rule.  Despite what is noted above, 1367 should still permit incomplete diversity of citizenship between litigants other than P and D, so long as the original jurisdiction between P and D isn’t contaminated.

Example: P (Fla.) sues D1 (Cal.) and D2 (Cal.) for $100K for a three-car accident.  D1 files a cross-claim against D2 for damages from the same accident. This shouldn’t “contaminate” the claim between P and D, because the adverse parties in the cross-claim are D1 and D2. Moreover, 1367(a) would permit supplemental jurisdiction (see 13(g)), and 1367(b) wouldn’t prevent it because the crossclaim is not asserted by a plaintiff.

Revised Mar. 2, 2015 (adding bold red text)