A new look at the original meaning of the diversity clause.

• Author: Moller, Mark

ABSTRACT

Must a federal court have obtained the power to bind a party before her citizenship becomes relevant to diversity jurisdiction? For a long time conventional wisdom has assumed the answer is "no": Congress can authorize diversity jurisdiction based on the citizenship of persons who, although currently beyond the court's power to bind, might later join the suit. Congress, in turn, has acted on this assumption. Key provisions of the most ambitious, and controversial, expansion of diversity jurisdiction in the last decade, the 2005 Class Action Fairness Act (CAFA), hinge diversity jurisdiction on the citizenship of persons conventionally believed beyond a court's power to bind--i.e., proposed class members in an uncertified class. Based on an examination of the original semantic meaning of the Diversity Clause, this Article argues that the conventional wisdom is wrong: Diversity jurisdiction is limited to suits in which citizens of different states are brought within a court's power to bind their interests. In the process, the Article sheds new light on the original meaning of an Article III "controversy"--in particular, on whom an Article III "controversy" subsists "between." The Article ends by exploring the ramifications of the Clause's original meaning. First, recovering that meaning reveals how Article III and due process norms combine to protect states from jurisdictional encroachment by federal courts. Second, the original meaning of the Clause provides a powerful textual basis for involving Congress in important decisions about the outer reach of federal principles of nonparty preclusion. The Article illustrates these points, and shows how they are related, by applying the original meaning of the Diversity Clause to resolve questions about the constitutionality of the Class Action Fairness Act.

TABLE OF CONTENTS INTRODUCTION I. THE METHOD EXPLAINED A. Evidence of Original Meaning B. A Note on Interpretation and Construction II. THE RISE AND FALL OF THE ORIGINAL DIVERSITY CLAUSE A. The Marshall-Hamilton Debate over the Meaning of Controversies Between Citizens of Different States B. Marshall's Pyrrhic Victory C. Hamilton's Revenge: The Modern "Transactional" Definition of a Controversy III. THE TWO CONVENTIONAL EIGHTEENTH-CENTURY MEANINGS OF "CONTROVERSY" A. "Suits". 1. 'Parties to the Suit" 2. The Relationship Between "Suits" and "Parties" 3. Expansion of the Concept of Parties and Suits in Representative Contexts B. "Disputes" IV. THE CONSTITUTIONAL MEANING OF "CONTROVERSY" A. Textual Evidence 1. Article III "Controversies" Are a Kind of "Case" 2. The Conventional Eighteenth-Century Meanings of "Case" 3. Intratextual Evidence That "Cases" (and "Controversies") Are Suits: The Article III Jury Trial Clause and the Original Jurisdiction Clause B. Preratification Interpretations of Cases and Controversies C. Reconstituting the Diversity Clause V. THE STRUCTURAL ROLE OF THE DIVERSITY CLAUSE A. Liberty Interests as a Federalism Safeguard B. The Diversity Clause and Separation of Powers C. Implications of Enforcing the Original Meaning of the Diversity Clause: The Example of CAFA 1. The Questionable Constitutionality of CAFA 2. Rectifying the Federalism and Separation of Powers Problems with CAFA 3. Some Final Objections Considered CONCLUSION INTRODUCTION

The Diversity Clause is the Walter Mitty of Article III's jurisdictional grants: staid and pedestrian, nothing new or interesting seems possible to say about it. But like Walter Mitty, the Diversity Clause has unplumbed depths.

The hint that we don't know the Diversity Clause as well as we think we do lies in a jurisdictional puzzle raised by the Class Action Fairness Act (CAFA), (1) passed by Congress in 2005. CAFA's principal goal is to pull large multistate class actions filed in state court into federal court, where its proponents hope that federal judges--thanks to their independence from the fundraising pressures of state electoral politics and, perhaps, to Republican success in filling out the ranks of the federal judiciary--will take a sterner hand with the class action bar than their state counterparts.

To achieve that goal, CAFA jettisons the complete diversity rule, allowing federal courts to exercise jurisdiction over multistate class actions if a class action exhibits minimum diversity. (2) Notably, CAFA allows federal courts to consider the citizenship of absent class members before a class has been certified when determining whether minimum diversity exists. (3) As a result, plaintiffs' lawyers cannot park a multistate class action in state court simply by recruiting a nondiverse named plaintiff to sue the defendant. So long as the plaintiff proposes to represent a class that allegedly includes members who live outside the defendant's domicile, the class action is removable at the time it is filed.

Brian Wolfman, Public Citizen's litigation director, pointed out the puzzle raised by CAFA in 1999 testimony to the House Judiciary Committee on an early iteration of CAFA. "When a proposed class action is filed," he said,

the class does not yet exist and a constitutional "controversy" exists only between the named plaintiffs and the defendant.... Put another way, there is no controversy between the absent class members ... and the defendant, and thus it is difficult to imagine how diversity jurisdiction can be constitutionally maintained [based on class members' citizenship] prior to certification of the class. (4) As Wolfman suggests, by treating absent members of a proposed class--persons conventionally seen as outside the scope of the suit at the time it is filed--as persons whose citizenship counts toward diversity jurisdiction, CAFA forces us to ask who an Article III "controversy" is "between" for purposes of establishing diversity jurisdiction.

Surprisingly, this elementary question about the meaning of the Diversity Clause hasn't been answered. (5) Answering it--the task of this Article--uncovers something new about the scope of diversity jurisdiction: Diversity jurisdiction is limited to suits in which citizens of different states are within the court's power to bind their interests. (6) In other words, contrary to received wisdom, the constitutional reach of diversity jurisdiction and the constitutional scope of federal courts' power to issue preclusive judgments are linked.

The argument rests on the original meaning of an Article III controversy. As I show, an Article III controversy is a "suit," and "suits" were defined in the eighteenth century to exist only "between" the "parties to the suit," persons who had been brought "before" the court in a way that allowed it to bind their rights. Because an Article III "controversy" subsists between persons who can be bound by federal judgments, those persons' citizenship--but no others--may be considered in the diversity jurisdiction calculus.

Showing that Article III's most familiar clause is also its most misunderstood takes some work. The argument builds over five parts. Parts I and II take some time to do some necessary groundclearing. Because the argument is based on new evidence about the original meaning of an Article III "controversy," Part I begins with a short overview of "original meaning" originalism, a frequently misunderstood interpretive method.

To forestall initial resistance to the argument based on its apparent novelty, Part II shows that the interpretation advanced herein isn't novel. It was advanced soon after the Constitution's ratification, only to be discarded by later courts and forgotten by commentators.

The Article then delves into the key evidence of the Clause's meaning, drawn from preratification sources. I develop this argument in two parts. Part III shows that one of the conventional meanings of "controversies" was "suits" and that "suits" in the eighteenth century were defined to exist only between those within a court's power to bind. Part IV then shows that the text of Article III requires us to interpret "controversies" to mean suits and excludes broader interpretations of the term.

With the hidden dimensions of the Diversity Clause revealed, Part V ends by exploring two larger ramifications of the Clause's original meaning. First, recovering its original meaning reveals how Article III and the standards governing nonparty preclusion combine to protect states from jurisdictional encroachment by federal courts. Second, the original meaning of the Clause also provides a powerful textual basis for involving Congress in important decisions about the outer reach of federal preclusion. I illustrate both of these points, and show how they are related, by applying the original meaning of the Diversity Clause to resolve questions about the constitutionality of CAFA.

1. THE METHOD EXPLAINED

   Led by Justice Scalia, a new generation of originalists has rejected a search for the Framers' intentions and reframed originalism as a search for the meaning that reasonable readers of English within the Framers' linguistic community would assign to the Constitution's words. (7) Below, I follow this general approach, which its practitioners call "original meaning" originalism or "semantic originalism." (8)

   The distinction between older "original intent" originalism and modern "original meaning" originalism is often misunderstood. Accordingly, before diving into the evidence of the Diversity Clause's original meaning, a quick overview of the method pursued is necessary both to clarify the hierarchy of evidence of original meaning on which I rely and to define some originalist terminology-particularly the distinction between "interpretation" and "construction"--that will be used later in the argument.

   1. Evidence of Original Meaning

      Original meaning originalists agree on a hierarchy of source material. At the top of the pyramid are publicly available examples of the conventional meaning ascribed to words by members of the Framers' linguistic community, including...