Opinion ID: 76958
Heading Depth: 2
Heading Rank: 1

Heading: The Procedural Posture of the Jurisdictional Challenge

Text: 17 This interlocutory appeal is before us on an order denying MBC's Federal Rule of Civil Procedure 12(b)(1) motion to dismiss for lack of subject matter jurisdiction. Ordinarily, the test of federal jurisdiction is not whether the cause of action is one on which the claimant can recover. Rather, the test is whether `the cause of action alleged is so patently without merit as to justify ... the court's dismissal for want of jurisdiction.' McGinnis v. Ingram Equip. Co., 918 F.2d 1491, 1494 (11th Cir.1990) (en banc) (quoting Dime Coal Co. v. Combs, 796 F.2d 394, 396 (11th Cir.1986)). And, where the challenge to the court's jurisdiction is also a challenge to the existence of a federal cause of action, the proper course of action for the district court (assuming that the plaintiff's federal claim is not immaterial and made solely for the purpose of obtaining federal jurisdiction and is not insubstantial and frivolous) is to find that jurisdiction exists and deal with the objection as a direct attack on the merits of the plaintiff's case. Williamson v. Tucker, 645 F.2d 404, 415 (5th Cir.1981); see also McGinnis, 918 F.2d at 1494. 18 Here, the Defendants' motion to dismiss for lack of subject matter jurisdiction directly challenged the merits of the SEC's case. Ordinarily, such an attack is best resolved through a Rule 56 motion for summary judgment or a Rule 12(b)(6) motion to dismiss for failure to state a claim, which of course is automatically converted into a Rule 56 motion if the court considers matters outside the pleadings. See Williamson, 645 F.2d at 412-13. As the Williamson court explained, This provides an additional safeguard for the plaintiff, for, in addition to having all his allegations taken as true, the trial court cannot grant the motion unless there is no genuine issue of material fact. This protection is not, however, provided the plaintiff who faces dismissal for lack of subject matter jurisdiction. Id. at 412. When ruling on a 12(b)(1) motion, however, the court is not prevented from inquiring into undisputed facts. See id. at 413. A challenge to the court's subject matter jurisdiction can properly be resolved on undisputed facts, even if such a challenge involves a direct attack on the merits of plaintiff's claim. 19 We believe this is such a case. Although MBC's motion to dismiss for lack of subject matter jurisdiction goes to the heart of the SEC's case, the question whether MBC's viatical settlement contracts qualify as investment contracts under the Securities Acts can properly be answered on the undisputed facts presented by the record in this case. Both parties agree that this is so. They invite us to resolve this dispute, and we accept their invitation.