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• W253689378 abstract "Without opening the floodgates to removal of class actions to federal courts, limited use of the rule would be salutary FROM THEIR first day in law school, students are taught the distinctions between law and equity. Nonetheless, many of them become accustomed to the notion that in the merger, equity took a backseat to law and stayed there. Noting this, the creators of the Federal Rules of Civil Procedure designed the system of rules to allow more equity into the system, specifically to prevent the rise of form over substance.1 DIVERSITY JURISDICTION REQUIREMENT The amount-in-controversy requirement of the U.S. diversity of citizenship statute highlights the tension between law and equity, a tension that if left unresolved will continually lead to inconsistent and unfair results. The U.S. Supreme Court had a rare opportunity recently to ease the tension between law and equity by selecting a fair method for calculating the required amount-in-controversy for federal diversity jurisdiction, now $75,000, in Ford Motor Co. v. McCauley, but after granting certiorari, the Court dismissed the writ as improvidently granted.2 In order to invoke federal court diversity jurisdiction or to remove a state law claim from state to federal court, 28 U.S.C. sect; 1332 requires a showing of complete diversity between the parties and an amount in controversy that exceeds $75,000. While the rationale for diversity jurisdiction in federal court has never been clearly expressed, many legal scholars claim the purpose to be two-fold: to allow out-of-state defendants to escape state bias and to allow well-resourced federal courts to handle large cases better.3 The amount-in-controversy requirement, which has been increased by Congress over the years, seems designed to strike a balance between keeping smaller cases from federal courts, while at the same time allowing large, nationally important interstate cases to be decided by federal courts. Ford Motor Co. v. McCauley focuses on the inclusion of injunctions in calculating the amount-in-controversy requirement to establish federal jurisdiction over class actions. A defendant's cost of complying with an injunction sought by a class action should satisfy the amount-in-controversy requirement, when the compliance will cost the defendant more than $75,000, whether it covers the entire class or a single member of the class.4 In other words, courts must look to the cost of the injunction from a defendant's perspective in the context of class actions when the number of plaintiffs is irrelevant. There is conflict among the federal courts of appeals in managing multistate class actions involving injunctive relief and its relation to the tension between law and equity. Looking to the value of an injunction from the viewpoint of either party, known as the either-viewpoint rule, would help resolve the circuit court confusion. CIRCUIT CONFLICTS A. Law-Equity Split The origins of the paradox of the amount-in-controversy requirement can be traced to the tension between law and equity in the creation of rules of civil procedure. The legal technicalities in the diversity-removal statutes and the resulting paradox are symptoms of common law's dominance over equity. Pursuant to its powers under Article III of the U.S. Constitution, Congress conferred subject matter jurisdiction on the federal courts when it enacted the diversity statute to allow federal courts to hear cases between citizens of different states, traditionally justified on the fear that local prejudices preclude fair trials for out-of-state defendants.5 This was complemented by the removal statute which allowed defendants to remove a claim from state court to a federal court. By including an amount-in-controversy requirement, Congress limited the scope of the diversity and removal statutes. While actions for specific monetary relief pose little challenge for courts, cases seeking equitable relief raise major problems in calculating whether the claim satisfies the amount-in-controversy requirement. …" @default.
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• W253689378 date "2003-04-01" @default.
• W253689378 modified "2023-09-23" @default.
• W253689378 title "Using Equity to Set Amount in Controversy in Class Actions for Injunctive Relief: Without Opening the Floodgates to Removal of Class Actions to Federal Courts, Limited Use of the Either, Viewpoint Rule Would Be Salutary" @default.
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