Exxon Mobil Corp. v. Allapattah Services, Inc.

Exxon Mobil Corp. v. Allapattah Services, Inc., 545 U.S. 546 (2005), was a case in which the Supreme Court of the United States held that 28 USCA §1367 permits supplemental jurisdiction over joined claims that do not individually meet the amount-in-controversy requirements of §1332, provided that at least one claim meets the amount-in-controversy requirements.

Background

Federal Courts are courts of limited subject matter jurisdiction. The limited jurisdiction is created by specific grants contained in Article III, Section 2 of the United States Constitution, and Congress is granted authority to further limit the jurisdiction of the federal court. Congress cannot grant jurisdiction to the federal courts that would be prohibited by the Constitution, but they have the authority to further limit (narrow the scope of jurisdiction). Historically, Congress has authorized exercise of two primary types of jurisdiction in civil cases: federal-question jurisdiction (28 USC §1331), which grants jurisdiction over civil cases wherein the plaintiff seeks adjudication on the grounds of some Federal statute or rule; and diversity jurisdiction (28 USC §1332), wherein the plaintiffs are from different states of the Union.

In order to limit the number of cases in federal court, both of these forms of jurisdiction once required that the amount of money, or equivalent monetary value in the case of non-monetary relief, must reach a certain threshold. These requirements were called amount-in-controversy requirements, and at the time of Exxon, only diversity jurisdiction cases retained such requirements.

Simple grants of jurisdiction over plaintiffs' original claims under §1331 and §1332 would present problems for the efficient adjudication of disputes; a federal court may not have subject-matter jurisdiction over potential counter-claims by defendants, or other claims such as impleader and cross-claims. Without jurisdiction for these claims, proceedings between parties could be unnecessarily and inefficiently split between federal and state courts. Two types of additional jurisdiction developed to address this issue via judicial interpretation: pendent and ancillary jurisdiction. Disagreeing with the decision reached by the Supreme Court in Finley v. United States regarding pendent-party jurisdiction, Congress enacted 28 USC §1367, which brought pendent and ancillary jurisdiction under a single form of jurisdiction called supplemental jurisdiction.

The Exxon case was a combination of several United States Courts of Appeals cases, wherein certiorari was granted to resolve a split among Courts of Appeals. The question was whether §1367 granted supplemental jurisdiction to claims and parties joined to a claim for which original jurisdiction was based solely upon diversity of citizenship (§1332), and where the additional joined claims did not independently meet the amount-in-controversy requirements of §1332.

References

argued that the expansion of supplemental jurisdiction was prompted by a single case, designed to clarify district court jurisdiction over federal questions. Carefully examining the legislative history of the relevant portion of the statute, the dissenters concluded that a more narrow reading was preferable to the analysis of the majority. After a detailed analysis of ancillary and pendant jurisdiction, the historical precursors to supplemental jurisdiction, Justice Ginsburg concluded that the ambiguities of the statute as enacted should be read to preserve continuity and precedent, in so far as that construction is possible. In applying that standard, she concluded that Congress did not intended, nor did the language they adopted enact, an expansive grant of additional jurisdiction such that joined parties should no longer have to independently meet ALL requirements of diversity jurisdiction, including the individual consideration of the amount-in-controversy requirement.