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Note: Diversity Jurisdiction and Injunctive Relief: Using "Moving-Party Approach" to Value the Amount in Controversy

By Christopher A. Pinahs. Full text here.

A necessary requirement for federal diversity jurisdiction is that the amount in controversy exceeds $75,000. Injunctions, however, are not a sum certain, and courts often struggle to value this intangible form of relief for purposes of diversity jurisdiction. Further compounding this problem is the fact that injunctions often differentially impact the litigants—leaving courts uncertain as to the viewpoint from which to value the requested relief. One technique, termed the “plaintiff-viewpoint approach,” considers only the value of the injunction to the plaintiff when determining eligibility for diversity jurisdiction. Another method, the “either-party viewpoint,” assesses the value of the litigated object from the perspective of either the plaintiff or the defendant. The Note examines the circuit split surrounding these primary injunction valuation viewpoints and argues for adoption of a third technique, termed the “moving-party approach.”

The Note explains that the moving-party approach assesses the pecuniary value of the injunction to the plaintiff when assessing original jurisdiction and considers the defend­ant’s cost of compliance upon requests for removal. After examining the historical and theoretical basis for diversity jurisdiction, the Note outlines how the moving-party approach assesses the true value of the relief sought, while also amelio­rating in-state prejudices present in the plaintiff-viewpoint approach. Further, the Note explains that the moving-party approach comports with the well-pleaded complaint doctrine and extends federal diversity jurisdiction in a lesser fashion than the either-party viewpoint. The Note concludes with an explanation of how the Supreme Court or Congress could implement the moving-party approach for purposes of quantifying the diversity jurisdiction amount in controversy as it applies to injunctions.