redblueyellow wrote:Fed Civ Pro question:
Citizen of State A sues Corporation incorporated in State B under a products liability. Corporation impleads Manufacturer (incorporated in state A) for indemnification.
Citizen is given leave to amend the complaint to allege negligent manufacture against the Manufacturer.
Manufacturer then moves to dismiss citizen's action against it for lack of subject matter jurisdiction.
Which of the following is true?
Answer: The motion should be granted, because diversity is lacking.
I'm guessing if the P had not added the additional claim of negligent manufacturer and just left the Manufacturer to serve as indemnification, it would have been proper SMJ?
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Please confirm the following hypos I just made up:
Scenario 1:
1. Case is valid under diversity JX.
2. Def impleads third party defendant for whatever purpose
3. Third party defendant is from the same state as Plaintiff
4. There is still diversity present.
Correct?
Scenario 2:
1. Case is valid under diversity JX.
2. Def impleads third party defendant for whatever purpose
3. Third party defendant is from the same state as Plaintiff
4. Third party defendant alleges cause of action against Plaintiff
4. There is still diversity present.
Correct?
Scenario 3
1. Case is valid under diversity JX.
2. Def impleads third party defendant for whatever purpose
3. Third party defendant is from the same state as Plaintiff
4. Plaintiff alleges cause of action against third party defendant
4. DIVERSITY IS DESTROYED.
Correct?
The answer to your question is yes, but the why is more important. Supplemental jurisdiction applies to impleader (Rule 14), but NOT by the original P against the third-party defendant where the case is brought through diversity. This is an exception to the rule. It's because a 'devious' Plaintiff could use this as a back-door to get into federal court.
Example: P sues employer in diversity, but not employee who hit him in his car because there would be no diversity and he doesn't want federal court. He can't, thereafter, get the benefit of the bargain when Employer impleads Employee and then maintain jurisdiction via diversity after the fact. It's duplicitous.
Thus, just remember: For P to maintain a claim against the third-party defendant (or any party joined after the fact), he needs diversity or FQ and cannot rely on supplemental jurisdiction.
Scenario 1: Supplemental jurisdiction only between 3P and original D. Diversity only as to original D and P. So, this is fine.
Scenario 2: It completely depends on the basis the claim is brought as to whether (1) it should be denied because the third-party defendant is improperly bringing a claim or (2) Whether diversity is destroyed.
Under Rule 14, the third-party defendant MAY only assert (1) Defenses he would have against the original D (now also the third-party plaintiff) and (2) claims arising out of the same transaction or occurrence as P's original claim.
If the 3rd party D does this, it would invoke compulsory claims of P, which requires diversity only--no supplemental jurisdiction for these types of claims.
Scenario 3: Correct.