Opinion ID: 1263597
Heading Depth: 2
Heading Rank: 2

Heading: The Cause of Action Component of Federal Question Jurisdiction

Text: Federal courts are courts of limited jurisdiction. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994); Newell Operating Co. v. Int'l Union of United Auto., Aerospace & Agric. Implement Workers, 532 F.3d 583, 587 (7th Cir.2008). The circumscribed nature of the federal judiciary's jurisdiction is a function of restrictions placed upon it by both the United States Constitution and federal statutory law, both of which must authorize a federal court to hear a given type of case. See Kokkonen, 511 U.S. at 377, 114 S.Ct. 1673; Bender v. Williamsport Area Sch. Dist., 475 U.S. 534, 541, 106 S.Ct. 1326, 89 L.Ed.2d 501 (1986). The Constitution permits federal courts to hear only certain claims, including those claims between parties of diverse state citizenship and, most importantly for present purposes, federal question claims, or those arising under the laws of the United States. U.S. Const. art. III, § 2, cl. 1. This constitutional grant of judicial authority is broad. See Verlinden B.V. v. Cent. Bank of Nigeria, 461 U.S. 480, 495, 103 S.Ct. 1962, 76 L.Ed.2d 81 (1983); Osborn v. Bank of the U.S., 22 U.S. (9 Wheat.) 738, 823, 6 L.Ed. 204 (1824). Despite this broad grant of authority, the Constitution gives Congress the power to further refine the actual scope of federal jurisdiction. [4] See U.S. Const. art. I, § 8, cl. 9 (granting Congress the power [t]o constitute tribunals inferior to the Supreme Court); Ins. Corp. of Ir. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 701, 102 S.Ct. 2099, 72 L.Ed.2d 492 (1982) (Jurisdiction of the lower federal courts is further limited to those subjects encompassed within a statutory grant of jurisdiction.). In so doing, however, Congress may not exceed its constitutional authority. See Verlinden B.V., 461 U.S. at 491, 103 S.Ct. 1962 (Congress may not expand the jurisdiction of the federal courts beyond the bounds established by the Constitution.); Marquette Cement Mfg. Co. v. FTC, 147 F.2d 589, 593 (7th Cir.1945) (There are no limitations upon this congressional power [to grant jurisdiction to the federal courts] other than the Constitution.). In this way, the Constitution imposes a ceiling, albeit a high one, on the potential jurisdiction of the federal courts. As we will discuss, Congress, by means of statutory grant, uses its constitutional authority to more narrowly restrict the federal courts' subject-matter jurisdiction. Ins. Corp. of Ir., 456 U.S. at 701, 102 S.Ct. 2099; Teamsters Nat'l Auto. Transporters Indus. Negotiating Comm. v. Troha, 328 F.3d 325, 327 (7th Cir.2003) (Federal courts ... may only exercise jurisdiction where it is specifically authorized by federal statute.); Marquette Cement Mfg. Co., 147 F.2d at 593 (The jurisdiction and authority of [the federal courts] is confined solely to that which Congress bestows.). This allows Congress to exercise significant control over the types of cases federal courts may hear and is one of the many checks and balances built into the three-branch system of American government. See Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 101, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998). For many years, Congress withheld from federal courts the ability to hear claims based solely on federal law. It was not until 1875, in fact, that Congress furnished federal courts with general federal question jurisdiction. Act of Mar. 3, 1875, ch. 137, 18 Stat. 470. Today, federal question jurisdiction is codified at 28 U.S.C. § 1331, which states that [t]he district courts shall have original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States. Although the language of § 1331 is similar to that of Article III, courts have interpreted § 1331 much more narrowly than its constitutional counterpart. See Verlinden B.V., 461 U.S. at 494-95, 103 S.Ct. 1962 ([T]his Court never has held that statutory `arising under' jurisdiction is identical to Art. III `arising under' jurisdiction.... Art. III `arising under' jurisdiction is broader than federal-question jurisdiction under § 1331....). What arises under § 1331 has been the subject of much debate among the courts. See Franchise Tax Bd. v. Const. Laborers Vacation Trust, 463 U.S. 1, 8-9, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983) (discussing the difficulties of interpreting arising under). When, however, as here, a case presents a pure federal question, i.e., a claim that alleges only direct violations of federal law, the answer, at least in theory, is fairly straightforward. See Grable & Sons Metal Prods., Inc. v. Darue Eng'g & Mfg., 545 U.S. 308, 312, 125 S.Ct. 2363, 162 L.Ed.2d 257 (2005) (This [`arising under'] provision [of 28 U.S.C. § 1331] for federal-question jurisdiction is invoked by and large by plaintiffs pleading a cause of action created by federal law.). For purposes of exercising federal jurisdiction under § 1331, such a claim arises under federal law if the law in question creates a federal cause of action. See Am. Well Works Co. v. Layne & Bowler Co., 241 U.S. 257, 260, 36 S.Ct. 585, 60 L.Ed. 987 (1916); Bennett v. Sw. Airlines Co., 484 F.3d 907, 909 (7th Cir. 2007). Thus, when the basis of the action is a federal statute, a federal cause of action must exist as well for a federal court to hear a given claim; the general grant of federal question jurisdiction contained in § 1331, without a federal cause of action, is not enough. [5] Nat'l R.R. Passenger Corp. v. Nat'l Ass'n of R.R. Passengers, 414 U.S. 453, 456, 94 S.Ct. 690, 38 L.Ed.2d 646 (1974). As the Supreme Court has said: [T]he threshold question clearly is whether the [Act] ... creates a cause of action whereby a private party... can enforce duties and obligations imposed by the Act; for it is only if such a right of action exists that we need consider... whether the District Court had jurisdiction to entertain it. Id. at 456, 94 S.Ct. 690. This appeal calls for us to answer that threshold question in the context of § 501.