Opinion ID: 2519890
Heading Depth: 5
Heading Rank: 2

Heading: Diversity jurisdiction

Text: Diversity jurisdiction extends to controversies between citizens of different states. [18] Generally, there is a presumption against diversity jurisdiction unless diversity jurisdiction is properly asserted in the pleadings. [19] This presumption places the burden of proof on the party asserting jurisdiction, the sufficiency of which may be raised by the parties or sua sponte by the court at any time. [20] However, a court's discretion to dismiss for lack of subject matter jurisdiction, when the plaintiff could have pled diversity jurisdiction and such jurisdiction in fact exists, should be used sparingly. [21] Jurisdiction may be sustained on the basis of a statute not relied on or alleged in the pleadings. [22] As such, a court may sustain jurisdiction, even if defectively pled, when a proper basis for jurisdiction exists upon review of the entire complaint. [23] Diversity jurisdiction was not properly pled in district court. The first complaint merely alleged jurisdiction under the Miller Act. In its amended complaint, Tru-Line attempted to allege diversity jurisdiction. Tru-Line is a California corporation and USF & E is an Alaska corporation. These facts were disclosed during oral argument on the summary judgment motion. During that argument, Judge Sedwick allowed Tru-Line to withdraw its defective amended complaint and granted it leave to file another amended complaint, one that would properly allege diversity jurisdiction. Tru-Line, though, never filed an amended complaint properly asserting diversity jurisdiction. In his order, Judge Sedwick discussed Tru-Line's state law contract claims. He did not, however, state that he was exercising diversity jurisdiction. Rather, he mentioned diversity jurisdiction in a footnote stating that [t]he Alaska Contractor Registration law is substantive in nature and therefore, applicable to Tru-Line's contract claims brought in federal court pursuant to diversity jurisdiction. Judge Sedwick's discussion of Tru-Line's state law contract claims did not constitute a final judgment on the merits. Having given Tru-Line the opportunity to file an amended complaint properly alleging diversity jurisdiction, and Tru-Line having failed to do so, Judge Sedwick's opinion acted only as an advisory opinion on the futility of such action. As Tru-Line did not have a valid claim under the Contractor Registration Act, Judge Sedwick stated, it was unable to sue on the contract it entered into with USF & E. As Judge Sedwick's discussion of the state law claims was advisory and not a judgment on those claims, it is no bar to Tru-Line filing a suit in state court on the contract. Summary judgment in favor of USF & E, therefore, should not have been granted.