AuthorPfander, James E.
PositionThe Nature of the Federal Equity Power


Scholars worry that we have lost something important with the merger of law and equity into a single civil action. (1) The same might be said of the joinder of pendent and ancillary jurisdiction into an all-purpose doctrine of supplemental jurisdiction. (2) By demanding a statutory text in Finley v. United States (3) and then giving the resulting statute, 28 U.S.C. [section] 1367, a wooden reading in Exxon Mobil v. Allapattah Services, the Supreme Court has deprived the doctrine of its flexibility. (4) Following the Court's lead, lower court results seem unfair, wasteful, and depressingly predictable.

Consider Griffin v. Lee. (5) There, a citizen of Mississippi (Griffin) commenced an action in Louisiana state court to reform a trust and recover for fraud. (6) Following removal to federal court based on diversity, Griffin prevailed in part, and the district court ordered the payment of proceeds from a reformed trust as compensation. (7) The lawyer who represented Griffin for a time in state and federal court (Lee) would withdraw from the representation but nonetheless filed an application to recover his lawyer's fee from the proceeds of any money Griffin recovered from the defendants. (8) After a bench trial, the district court awarded Lee $16,068. (9) But the Fifth Circuit overturned that award, finding (on its own motion) that the district court lacked supplemental jurisdiction over Lee's claim. (10) As the Fifth Circuit explained, Lee lacked citizenship diversity with the opposing individual trust fund defendants (all of whom were from Louisiana), and his claim did not meet the diversity statute's $75,000 threshold." Lee, apparently, was expected to start over in a separate state court proceeding, presumably naming his former client as the defendant. (12)

The result seems hard to square with the goal of litigation economy that underlies the expansion of supplemental jurisdiction. Who better to evaluate the contributions Lee made to securing relief on behalf of his client than the judge who presided over the proceeding? It also seems wholly inconsistent with the traditional use of ancillary bills in equity, which evolved to allow a party to assert a new claim to a fund or res that had been brought before the court for equitable distribution. Lee's claim for his fee, as a lawyer seeking protection upon withdrawal from litigation, falls comfortably within this ancillary tradition. But the ancillary jurisdiction tradition has been submerged in the supplemental jurisdiction statute and by its textual treatment of party intervention. Rather than engage with history, equity, and fairness, the Fifth Circuit's per curiam opinion offers a disquisition on plain language hard-hearted enough to make the Finley majority blush with pride.

In this Essay, we suggest that Griffin and other similar cases reveal the jurisdictional consequences of the merger of law and equity. Just as equity's distinctive voice has sometimes been distorted when joined with law and transmitted through one civil action, so too may the distinctive quality of ancillary jurisdiction in equity be lost through its incorporation into supplemental jurisdiction. The Griffin court was content to apply its own narrow view of the plain meaning of the statute, apparently unaware of (or unconcerned by) an equitable tradition that argued in favor of exercising adjudicatory power over the attorney's claim. We question that analytical approach. We urge instead that federal courts consider the distinctive role of equity as they evaluate ancillary forms of supplemental jurisdiction. Just as courts of equity entertained ancillary claims that failed to pass jurisdictional muster on their own, so too should federal courts today look for ways to interpret [section] 1367 that will honor the equitable traditions that gave rise to ancillary jurisdiction and were incorporated into the statute.

We set down our thoughts on law, equity, and supplemental jurisdiction in three parts. We begin in Part I by sketching the statutory issues that proved decisive in Griffin, including the problem of intervening parties as taken up by the drafters of [section] 1367. We then explore in Part II the historical roots of the intervention problem, distinguishing between original suits in law and equity that were required to meet the complete diversity requirement and ancillary bills to which the requirement was deemed inapplicable. Finally, we turn in Part III to a proposed solution. We suggest that the so-called Rule 19/24 anomaly on which the statute's drafters predicated their approach did not concern itself with the exercise of ancillary jurisdiction. Indeed, the exercise of ancillary jurisdiction in cases like Griffin does not offend complete diversity as understood for much of the nation's history. Along the way, we call for an interpretive approach to supplemental jurisdiction that leaves room for attentive consideration of sound jurisdictional policy.

  1. TEXTUALISM AND [section] 1367

    For much of the past thirty years, the Supreme Court has been delivering text-based lectures to lower courts called upon to consider issues of supplemental jurisdiction. It began in Finley, Justice Scalia's formative refusal to allow the exercise of pendent-party jurisdiction where Congress had failed to authorize such jurisdiction by statute. (13) It continued in Exxon Mobil, where the Court concluded that [section] 1367 had overruled its prior decision in Zahn. (14) Along the way, the Court confronted the suggestion of the statute's drafters that the federal courts should avoid that result through interpretation. The Court derided that suggestion as an attempt to "circumvent the Article I process" of bicameralism and presentment and as a confirmation of the "worst fears of [the] critics" of the use of legislative history. (15) The text, apparently, was to control.

    Despite its hymns to the centrality of text, much of what the Court has done tempers the lessons of text with sotto vocce acceptance of the relevance of sound jurisdictional policy. Finley purported to reaffirm the validity of several forms of supplemental jurisdiction that lacked any textual predicate, choosing to focus its criticisms on pendent-party jurisdiction. (16) Similarly, Exxon Mobil smuggled a non-text-based construct--the contamination theory--into its analysis to prevent its interpretation of the statute from dismantling the complete diversity rule. (17) The Court never explained why, in a statute like [section] 1332 that requires both citizenship diversity and an amount in controversy, its contamination theory would apply as a textual matter only to the citizenship requirement. (18) The Exxon Mobil Court's textualism thus turns out to be something of a distraction; its decision implements a judge-made preference for citizenship diversity as the more fundamental check on the district court's authority. (19)

    Apart from its faint-hearted textualism, the Court has at times suggested that some matters of supplemental jurisdiction may lie entirely beyond the purview of the text. Thus, in Kokkonen v. Guardian Life Insurance, the Court identified two forms of ancillary jurisdiction. (20) The first form "permit[s] disposition by a single court of claims that are, in varying respects and degrees, factually interdependent." (21) Because this form of ancillary jurisdiction depends on the factual interdependence of claims, it logically aligns with the ancillary jurisdiction codified in [section] 1367. The second form "enable[s] a court to function successfully... to manage its proceedings, vindicate its authority, and effectuate its decrees." (22) The Kokkonen Court appears to have viewed this "ancillary enforcement" jurisdiction as flowing not from the authority conferred by [section] 1367 but from a court's "inherent power." (23) So much, then, for Finley's notion that all assertions of judicial power require some sort of textual predicate.

    Unfortunately, the Court's cases do not openly acknowledge the limits of its textualism or explain where the demands of textualism should yield to concerns with good jurisdictional policy. And that lack of clarity translates into lower court decisions like Griffin v. Lee, exalting wooden textualism over the claims of fairness, convenience, equity, and good conscience. A citizen of Mississippi, Griffin brought suit for reformation of a trust, naming the trustee (Chase) and its officers (from Louisiana) as defendants. (24) Following removal of the case based on diversity, Griffin secured at least a portion of the relief sought. (25) Having represented Griffin in state and federal court, Lee sought to collect an attorney's fee for his work on the matter by pursuing any funds that might later be released to Griffin. (26) The district court agreed to hear Lee's claim and awarded him $16,068. (27)

    On appeal the Fifth Circuit directed the district court to dismiss Lee's claim for want of supplemental jurisdiction. (28) Lee was nondiverse in relation to the original defendants from Louisiana and his claim did not meet the statutory threshold for diversity. (29) His joinder as a suitor in the initial proceeding would have thus destroyed diversity. (30) Recognizing that supplemental jurisdiction might nonetheless attach, the court ruled that the proposed claim for fees ran afoul of [section] 1367(b). (31) Lee was an intervenor and thus could not join if his claim would violate the requirements of the diversity statute. (32) By the Fifth Circuit's lights, Lee was a plaintiff, properly aligned in opposition to the trustee and its officers, and his joinder would thus violate the precepts of diversity of citizenship. (33)

    In rejecting sensible arguments in support of jurisdiction, the Fifth Circuit portrayed its result as compelled by text...

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