Court Opinion

ID: 9494303
Source: CourtListenerOpinion
Date Created: 2023-08-05 15:34:41.680836+00
Date Added: 2024-06-11T17:56:20.576550
License: Public Domain

DIANA GRIBBON MOTZ, Circuit Judge,
dissenting:
Because § 1367 unambiguously preserves the rule of Zahn v. International Paper Company, 414 U.S. 291, 94 S.Ct. 505, 38 L.Ed.2d 511 (1973), I respectfully dissent.
I.
Section 1367(a) provides in relevant part:
Except as provided in subsections (b) and (c) or as expressly provided otherwise by Federal statute, in any civil action of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the United States Constitution.
28 U.S.C. § 1367 (1994) (emphasis added). Thus, § 1367 clearly grants federal courts supplemental jurisdiction over certain claims that are outside the courts’ original jurisdiction.
Just as clearly, however, § 1367 only grants supplemental jurisdiction where there is first a “civil action of which the district courts have original jurisdiction.” Id. No original jurisdiction exists here. In diversity cases, like the one at hand, federal courts only have original jurisdiction when the “matter in controversy exceeds the sum or value of $75,000” and the controversy is between “citizens of different States.” 28 U.S.C. § 1332(a) (1994 & Supp. II 1996). Thus, in diversity cases a federal court cannot exercise supplemental jurisdiction over a claim unless it first has original jurisdiction over a civil action “between citizens of different states” in which the “matter in controversy” exceeds $75,000.
Section 1332 does not itself state whether each plaintiff in a diversity case must be a citizen of a different state from each defendant, or if only one plaintiff need be of diverse citizenship. Nor does § 1332 state whether each plaintiff in a diversity suit must have a claim in which at least *123$75,000 is “in controversy,” or if all of the plaintiffs’ claims may be aggregated to reach the jurisdictional amount, or if only one plaintiff need satisfy the “matter in controversy” requirement.
Since the earliest years of the Republic, however, the Supreme Court has interpreted the diversity jurisdiction statute to require complete diversity of citizenship of each plaintiff from each defendant. See Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267, 2 L.Ed. 435 (1806). Moreover, it has long been the rule that each plaintiff in a diversity suit must independently satisfy the diversity statute’s jurisdictional amount in controversy. See Clark v. Paul Gray, Inc., 306 U.S. 583, 589, 59 S.Ct. 744, 83 L.Ed. 1001 (1939) (“when several plaintiffs assert separate and distinct demands in a single suit, the amount involved in each separate controversy must be of the requisite amount to be within the jurisdiction of the district court”); Pinel v. Pinel, 240 U.S. 594, 596, 36 S.Ct. 416, 60 L.Ed. 817 (1916) (same); Troy Bank v. Whitehead & Co., 222 U.S. 39, 40, 32 S.Ct. 9, 56 L.Ed. 81 (1911) (same). The Court has reasoned that § 1332’s two requirements— “diversity” and “matter in controversy”— are jurisdictional, and the statute’s grant of “original jurisdiction” to federal courts depends upon each and every plaintiff satisfying each of those requirements.
The Supreme Court has also held that § 1332’s dual requirements generally apply in diversity-based class actions. Thus, in Supreme Tribe of Ben-Hur v. Cauble, 255 U.S. 356, 366-67, 41 S.Ct. 338, 65 L.Ed. 673 (1921), the Court concluded that § 1332 mandates that each named plaintiff must be completely diverse from each named defendant, although unnamed plaintiffs need not be diverse. In Snyder v. Harris, 394 U.S. 332, 89 S.Ct. 1053, 22 L.Ed.2d 319 (1969), and Zahn, the Court applied the “matter in controversy” requirement even more strictly, holding that this requirement applied to both named and unnamed parties.
In Snyder, the Court concluded that where no members of the plaintiff class possessed a claim meeting the “matter in controversy” requirement they could not aggregate their claims; and so a federal court had no jurisdiction over such a class action. Id. at 336, 89 S.Ct. 1053. The Court relied on the century-long congressional practice of narrowing rather than expanding diversity jurisdiction. It noted that “since the first judiciary act in 1789” Congress has repeatedly increased the amount necessary to meet the “matter in controversy” requirement and, when doing so, re-enacted the “matter in controversy” rule “against a background of judicial interpretation” that restrictively construed it. Snyder, 394 U.S. at 333-39, 89 S.Ct. 1053. Indeed, as the Snyder Court explained, Congress had accepted restrictive judicial interpretation of § 1332 for so long that this interpretation had to be recognized as more than a “judge-made formula.” Id.1
In Zahn, the Supreme Court considered whether Snyder applied to diversity-based class actions like the one at issue here, in .which only the named plaintiff satisfied the “matter in controversy” requirement. See Zahn, 414 U.S. at 292, 94 S.Ct. 505. In *124determining whether each plaintiff in the class, named or unnamed, needed to satisfy the “matter in controversy” requirement of § 1332 in order for a federal court to exercise jurisdiction, the Court looked to its previous interpretations of § 1332 for both class actions and non-class actions. See id. at 295-300, 94 S.Ct. 505. Relying on its “long standing construction of the ‘matter in controversy’ requirement of § 1332,” the Zahn Court concluded that “[e]ach plaintiff in a Rule 23(b)(3) class action must satisfy the jurisdictional amount, and any plaintiff who does not must be dismissed from the case. Id. at 301, 94 S.Ct. 505. In other words, ‘one plaintiff may not ride in on another’s coattails.’ ” Zahn, 414 U.S. at 301, 94 S.Ct. 505.
In so concluding, the Court made clear that its holding was premised upon its construction of § 1332’s “matter in controversy” requirement. Id. at 299, 94 S.Ct. 505 (“Th[e] doctrine is based ... upon this Court’s interpretation of the statutory phrase ‘matter in controversy.’ ”) (quoting Snyder, 394 U.S. at 336-37, 89 S.Ct. 1053). The Zahn Court found that the language of § 1332 was best interpreted to require every class member to satisfy that requirement; thus, it held, when a plaintiff files a diversity-based class action in federal court, each member of the class must allege a claim in which “the matter in controversy” exceeds $75,000 in order for a federal court to have jurisdiction over the action. See Zahn, 414 U.S. at 301, 94 S.Ct. 505.
In summary, the Supreme Court has definitively interpreted § 1332’s requirements in Strawbridge, Ben-Hur, Snyder and — most important to this case — Zahn. The Court has not in any way limited the holding it declared less than thirty years ago in Zahn. Nor has Congress amended § 1332 to overrule Zahn. This requires us to find that the rule established in Zahn stands and governs this case. Before the district court could take advantage of § 1367’s grant of supplemental jurisdiction, it first must have possessed jurisdiction over the action under § 1332. However, because not every member of the class in this diversity-based class action “satisfies] the jurisdictional amount,” Zahn, 414 U.S. at 301, 94 S.Ct. 505, the district court possessed no original jurisdiction over the action under § 1332, and so could not exercise supplemental jurisdiction under § 1367.
II.
Nevertheless, Pfizer maintains, and the majority holds, that when, in 1990, Congress enacted the supplemental jurisdiction statute, 28 U.S.C. § 1367, it legislatively overruled Zahn. Nothing in § 1367 remotely suggests that this statute eliminates or modifies any of the requirements for original diversity jurisdiction that the Supreme Court has long held mandated by § 1332. Rather, without in any way qualifying or limiting § 1332’s requirement, § 1367 specifically refers to § 1332 as a possible basis for the original jurisdiction necessary to any “supplemental jurisdiction.” See 28 U.S.C. § 1367(b). The majority’s holding that Congress chose § 1367 as a vehicle to overrule Zahn, a case interpreting § 1332, is therefore puzzling.
To accomplish this incongruous result, the majority must look past the Supreme Court’s clear and definitive interpretations of § 1332 and break off the claims of some plaintiffs from those of the other plaintiffs in the class. This approach essentially queries whether any of the plaintiffs in the class could have — had they foregone a class action — brought a proper diversity suit in federal court against the named defendants. If the district court would *125have had original jurisdiction over such a hypothetical suit, the majority would allow § 1367 to provide supplemental jurisdiction over the remaining class members. This approach puts the proverbial cart before the horse. In a diversity-based class action, no federal jurisdiction exists at all unless and until the requirements of § 1332, including those set forth in Zahn, have been satisfied.
This is not to say that § 1367 requires a district court to assess “original jurisdiction over the whole action at the initiation of a complaint” in every case, regardless of the claims set forth in the complaint. Ante at 115 (describing the rationale in Leonhardt v. Western Sugar Co., 160 F.3d 631, 640 (10th Cir.1998)). However, a district court surely must examine a complaint in which the asserted basis of federal jurisdiction is diversity of citizenship to determine whether the complaint meets § 1332’s jurisdictional prerequisites. Moreover, following this procedure — which is, after all, the established means of assessing diversity jurisdiction — does not render “superfluous” the language in § 1367(a) giving courts supplemental jurisdiction over “ ‘all other claims that are so related to claims in the action within such original jurisdiction.’” Ante at 115-116 (quoting 28 U.S.C. § 1367(a)). That statutory language retains important meaning; it permits supplemental jurisdiction over claims in non-diversity cases and, subject to the limitations in § 1367(b), over additional claims in diversity cases after a proper diversity complaint has been filed.
Nor does retaining the Zahn rule affect the holdings in United Mine Workers of America v. Gibbs, 383 U.S. 715, 86 S.Ct. 1130, 16 L.Ed.2d 218 (1966), and Finley v. United States, 490 U.S. 545, 109 S.Ct. 2003, 104 L.Ed.2d 593 (1989). Cf. ante at 116-117. Gibbs is a federal question case and Finley was brought under the Federal Tort Claims Act. Neither is a diversity case. The distinction between federal question cases (or, for that matter, any case with a federal jurisdictional basis other than § 1332) and diversity cases is critical. Federal question cases do indeed involve one federal “claim” creating jurisdiction, which is viewed independently from other claims in the complaint that are premised upon supplemental jurisdiction. This is because a federal court’s jurisdiction in federal question cases cannot be destroyed by the identity or claims of other parties in an action. In contrast, a federal court’s jurisdiction in a diversity case wholly turns on the identity and claims of the parties.
Furthermore, the linchpin of the majority’s statutory analysis — reliance on the prohibitions listed in § 1367(b) — fatally undermines, rather than supports, the majority’s holding.
Section 1367(b) provides:
In any civil action of which the district courts have original jurisdiction founded solely on section 1332 of this title, the district courts shall not have supplemental jurisdiction under subsection (a) over claims by plaintiffs against persons made parties under Rule 14, 19, 20 or 24 of the Federal Rules of Civil Procedure, or over claims by persons proposed to be joined as plaintiffs under Rule 19 of such rules, or seeking to intervene as plaintiffs under Rule 24 of such rules, when exercising supplemental jurisdiction over such claims would be inconsistent with the jurisdictional requirements of Section 1332.
28 U.S.C. § 1367(b).
The majority maintains that because “nowhere in § 1367(b) does it exempt from the normal rules of supplemental jurisdiction persons made parties under Rule 23,” a court would have to “rewrite the statute to insert Rule 23 into § 1367(b)’s list of *126exceptions” to retain Zahn. Ante at 115. But this is certainly not the case if “original jurisdiction” in § 1367(a) is given its natural meaning; in diversity cases, that meaning is the one authoritatively determined by the Supreme Court in Straw-bridge, Ben-Hur, Snyder, Zahn, etc. Indeed, the omission of Rule 23 from § 1367(b)’s list is hardly surprising given that the diversity jurisdiction requirements, as articulated in these cases, was codified in the “original jurisdiction” requirement of § 1367(a). Moreover, this reading of § 1367(a) does not render § 1367(b)’s various prohibitions on supplemental jurisdiction unnecessary because § 1367(b) bars parties, after the action has commenced, from invoking supplemental jurisdiction over claims they could not have asserted, consistent with diversity jurisdiction requirements, at the outset.2
On the other hand, if the majority were correct and § 1367(a) did not recognize the diversity jurisdiction requirements authoritatively set forth by the Supreme Court in Strawbridge, Zahn, etc., then § 1367(b)’s limited use of Rule 20 — only to prevent district courts from exercising supplemental jurisdiction over the permissive joinder of “claims by plaintiffs against persons made parties,” i.e., claims against defendants' — would wreak havoc. The majority contends that, if one plaintiff satisfies the requirements of § 1332, the district court possesses original jurisdiction under that statute and so may exercise supplemental jurisdiction under § 1367 over related claims. If the majority were correct, then § 1367 would permit a plaintiff meeting § 1332’s jurisdictional requirements to use Rule 20 to join as a plaintiff any party who possesses a related claim even if that plaintiff destroyed complete diversity.
The majority’s approach strips § 1367(b) of all logic. To take that approach, we must believe that Congress fashioned a statute that carefully preserves limitations on diversity jurisdiction after an action has been filed (by barring plaintiffs from using Rules 14, 19, and 24 to join claims against non-diverse defendants and by barring would-be non-diverse plaintiffs from joining or intervening in an ongoing diversity action under Rules 19 and 24), yet permits persons whose claims would defeat diversity to join an action at the outset (by allowing a non-diverse plaintiff to use Rule 20 to join a diversity action at its commencement). Furthermore, if the majority were correct, § 1367(b)’s prohibition on would-be non-diverse plaintiffs joining an action under Rule 19 or intervening under Rule 24 would be hollow indeed; a plaintiff could simply dismiss his original action and refile, joining the non-diverse plaintiff under Rule 20 — even though that non-diverse plaintiff could not have joined the original *127action under Rule 19, or intervened under Rule 24.
Moreover, under the majority’s interpretation, § 1867 overrules not just Zahn, but also the venerable precedent established almost 200 years ago in Strawbridge v. Curtiss. Before today, plaintiffs have not been allowed to use ancillary or pendent jurisdiction to circumvent Strawbridge,3 But, if the majority’s approach is followed, plaintiffs could do precisely this. No longer would plaintiffs need to concern themselves with establishing complete diversity. Rather, the presence of one diverse plaintiff would allow joinder of any related claims by non-diverse plaintiffs. Instead of acceding to the “rightful independence of state governments,” by “scrupulously confin[ing]” federal diversity jurisdiction, the majority interprets § 1367 in a way that allows the federal courts to determine countless local controversies, involving only state law questions. Snyder, 394 U.S. at 340, 89 S.Ct. 1053.
In addition to upsetting long-established precedent, the majority’s interpretation utterly conflicts with the steadfast Congressional policy of restricting, rather than expanding, diversity jurisdiction. The majority’s holding would be remarkable even if compelled by the statutory text. But nothing in § 1367 requires this holding. Indeed, it runs directly counter to the statute’s plain language, which permits a federal court to exercise supplemental jurisdiction only when it first has “original jurisdiction” over a claim.
Nor does the majority’s approach find any support in § 1367’s legislative history. Congress enacted § 1367 in response to a suggestion of the fifteen-member Federal Courts Study Committee, which had been established by Congress “to make a complete study of the courts of the United States and of the several States and transmit a report to the President, the Chief Justice of the United States, [and] the Congress ... on such study.” Federal Courts Study Act, Pub.L. No. 100-702, §§ 101-109, 102 Stat. 4642 (1988). After months of study, numerous meetings, and four public hearings, the Committee issued its 200 page report. That report found that the federal courts faced a “crisis” because of a “rapidly growing and already enormous caseload,” and recommended that to address this problem, Congress severely curtail federal diversity jurisdiction. Report of the Federal Courts Study Committee at 4, 14-15 (April 2, 1990). *128The Study Committee noted that if Congress followed this recommendation it would “free up the time of the federal courts” to be “more effective protectors of federal rights”; among the recommendations offered to further this goal was “placing a firm statutory foundation under ‘pendent party jurisdiction.’ ” Id. at 15; see also id. at 47-48. Congress drafted § 1367 to adopt the recommendation as to “pendent party jurisdiction,” which was partially based on disagreement with Finley v. United States, 490 U.S. 545, 109 S.Ct. 2003, 104 L.Ed.2d 593 (1989) (holding pendent party jurisdiction unavailable in a federal question case). See H.R.Rep. No. 101-734, reprinted in 1990 U.S.C.C.A.N. 6860, 6873 (“This section implements a recommendation of the Federal Courts Study Committee found on pages 47 and 48 of its Report”).
Although it is clear that Congress did not determine to accept the Study Committee’s suggestion to curtail diversity jurisdiction, it is equally clear that Congress did not determine to expand diversity jurisdiction by enactment of § 1367, as the majority’s interpretation of that statute would. See H.R.Rep. No. 101-734, reprinted in 1990 U.S.C.C.A.N. 6860, 6875 (explaining § 1367 “is not intended to affect the jurisdictional requirements of 28 U.S.C. § 1332 in diversity-only class actions, as those requirements were interpreted prior to Finley ”). Indeed, the House Report accompanying § 1367 (which was adopted by the Senate Judiciary Committee in its consideration of the proposed legislation, see 136 Cong. Rec. S17580-81 (daily ed. Oct. 27, 1990)), plainly states that the new statute was merely intended to “restore the pre-Finley understandings of the authorization for and limits on other forms of supplemental jurisdiction.” H.R.Rep. No. 101-734, reprinted in 1990 U.S.C.C.A.N. 6860, 6874. Moreover, the Report includes an express notation that Zahn was to survive enactment of § 1367. Id. at 6875 n. 17. This is more than a vague and isolated comment or a mere “buried reference in a committee report.” Cf. ante at 121. Congress has— in the official committee report accompanying the statute which both Houses adopted — expressly provides that § 1367 was not “to affect the jurisdictional requirements” of § 1332 and that Zahn was to survive the enactment of § 1367.4
The majority’s interpretation of § 1367 also calls attention to the omission in the legislative history of even a suggestion that Congress intended § 1367 to eviscerate 200 years of diversity jurisprudence going back to Strawbridge. The impact of the majority’s approach is staggering and totally at odds with a continuous congressional policy — before and after enactment of § 1367 — -to limit diversity jurisdiction. See, e.g., Pub.L. No. 85-554 (raising jurisdictional amount from $3,000 to $10,000 in 1958); Pub.L. No. 100-702 (raising jurisdictional amount from $10,000 to $50,000 in 1988); Pub.L. No. 104-317 (raising jurisdictional amount from $50,000 to $75,000 in 1996). One would think that had Congress embarked upon such an important reversal of course, its actions would have generated at least some discussion and debate. Instead, we find not even a snippet of legislative history — not a remark at a hearing, not a passage in a committee report, not a *129floor comment — suggesting that in § 1367 Congress intended to overrule Straw-bridge and Zahn and so broadly expand the diversity jurisdiction of the federal courts. Indeed, § 1332’s original jurisdiction requirements were “so plainly etched in the federal courts prior to [the enactment of § 1367] that had there been any thought of departing from these decisions ... some express statement of that intention would surely have appeared, either in the [statute] or in the official commentaries.” Zahn, 414 U.S. at 302, 94 S.Ct. 505; see also Edmonds v. Compagnie Generale Transatlantique, 443 U.S. 256, 266-67, 99 S.Ct. 2753, 61 L.Ed.2d 521 (1979) (such “silence” in legislative history “is most eloquent, for such reticence while contemplating an important and controversial change in existing law is unlikely”).
III.
In short, the majority today fashions an interpretation of § 1367 that derives support from neither its text nor its history; in result, the majority creates a law that Congress never enacted and never intended to enact. There is no reason why this court should interpret § 1367 in a manner contrary to its language, particularly when the statute’s legislative history, as well as longstanding congressional policy limiting diversity jurisdiction, confirm the correctness of an interpretation that gives effect to the plain statutory language. Accordingly, I respectfully dissent.

. The Snyder Court noted that the well-established "congressional purpose” to limit diversity jurisdiction served two salutary goals: (1) limiting the rising caseload of diversity cases so that the federal courts would not be overwhelmed by state law questions and unable to resolve federal question cases promptly, and (2) acceding to the "rightful independence of state governments,” which "requires that[federal courts] scrupulously confine their own jurisdiction to the precise limits which the statute [§ 1332] defined.” Id. at 339-40, 89 S.Ct. 1053 (quoting Healy v. Ratta, 292 U.S. 263, 270, 54 S.Ct. 700, 78 L.Ed. 1248 (1934)).

. Specifically, § 1367(b) prohibits supplemental jurisdiction over claims of would-be plaintiffs, who attempt to join an ongoing diversity action under Rule 19 or to intervene in such an action under Rule 24, when the presence of these plaintiffs would destroy diversity jurisdiction, i.e., would be “inconsistent with the jurisdictional requirements of section 1332." 28 U.S.C. § 1367(b). Section 1367(b) also prevents plaintiffs in an ongoing diversity action from employing supplemental jurisdiction to assert claims "inconsistent with the jurisdictional requirements of” § 1332, id., by barring plaintiffs from asserting claims against non-diverse defendants who intervene under Rule 24, are impleaded under Rule 14, joined under Rule 19, or joined to a cross-claim or counterclaim under Rule 20. (Thus, contrary to the majority’s assertion, ante at 116-117, the inclusion in § 1367(b) of a prohibition on supplemental jurisdiction over claims against non-diverse defendants under Rule 20 does, indeed, serve a valid “need,” i.e. prohibiting counter and cross-claims by plaintiffs against defendants brought into an existing diversity action. See Fed. R. Civ. Pro. 13(h) ("Persons other than those made parties to the original action may be made parties to a counterclaim or cross-claim in *127accordance with the provisions of Rules 19 and 20.”).)

. The sole exception to Strawbridge's well-established restrictive interpretation of § 1332 is Ben-Hur (unnamed plaintiffs in diversity-based class actions need not have diverse citizenship). Without explanation, the majority and Professor Moore suggest that it is impossible to interpret § 1367 to preserve both Ben-Hur and Zahn. See ante at 117-118 n. 4 (quoting 16 James W. Moore, et al., Moore's Fed. Practice ¶ 106.44 at 106-33 (3d ed.1998)). Although I hate to disagree with such respected authorities as my colleagues and Professor Moore, the plain textual reading of § 1367, which I espouse, preserves both Ben-Hur and Zahn. Both cases interpret the diversity jurisdiction requirements in § 1332; to exercise original diversity jurisdiction under § 1332, a court must follow both cases, and thus for a court with diversity jurisdiction to exercise supplemental jurisdiction under § 1367, it must, by definition, also follow both Ben-Hur and Zahn. Nor is there anything untoward about this. Indeed, to preserve the Ben-Hur holding but eliminate Zahn, which the majority apparently proposes, would itself be untoward — striking a substantial and totally unnecessary blow to the prerogatives of the states. As the Supreme Court noted in Snyder, in words equally applicable here, for a court to adopt an expansive interpretation of the amount in controversy requirement, as the majority does, when, because of the Ben-Hur rule, "only one member of the entire class is of diverse citizenship could transfer into the federal courts numerous locad controversies involving exclusively questions of state law.” Snyder, 394 U.S. at 340, 89 S.Ct. 1053.

. Lest there be a suggestion that.my membership on the Federal Courts Study Committee has led me to an unprincipled acceptance of its views, I note that as a member, I voted against its recommendation that Congress limit diversity jurisdiction. See Report of the Federal Courts Study Committee at 42-43. Although the result the majority reaches today may better accord with my personal policy views, I cannot concur in its holding given the clear statutory language adopted by the appropriate policy-maker — the Congress.