H.R. 394 (112th): Federal Courts Jurisdiction and Venue Clarification Act of 2011

Introduced:
Jan 24, 2011 (112th Congress, 2011–2013)
Sponsor:
Rep. Lamar Smith [R-TX21]
Status:
Signed by the President
Slip Law:
This bill became Pub.L. 112-63.

The bill’s title was written by the bill’s sponsor. H.R. stands for House of Representatives bill.

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Status

This bill was enacted after being signed by the President on December 7, 2011.

Progress
Introduced Jan 24, 2011
Referred to Committee Jan 24, 2011
Reported by Committee Jan 26, 2011
Passed House Feb 28, 2011
Passed Senate with Changes Oct 31, 2011
Passed Senate Nov 18, 2011
Signed by the President Dec 07, 2011
Votes

House Vote on Passage
Feb 28, 2011 6:55 p.m.
Passed 402/0

Cosponsors
3 cosponsors (2D, 1R) (show)
Committees

House Judiciary

Senate Judiciary

The committee chair determines whether a bill will move past the committee stage.

Full Title

To amend title 28, United States Code, to clarify the jurisdiction of the Federal courts, and for other purposes.

Summary

No summaries available.

Text

Read Bill Text »

Last updated Jan 01, 2012.
8 pages

Primary Source

View on THOMAS (The Library of Congress)

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Citation

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GovTrack’s Bill Summary

We don’t have a summary available yet.

Library of Congress Summary

The summary below was written by the Congressional Research Service, which is a nonpartisan division of the Library of Congress.

12/7/2011.
Title I - Jurisdictional Improvements
Section 101 -
Amends the federal judicial code to declare that, with respect to diversity of citizenship, the U.S. district courts shall not have original jurisdiction of any civil action between citizens of a state and citizens or subjects of a foreign state who are lawfully admitted for permanent residence in the United States and are domiciled in the same state.
Section 102 -
Modifies the citizenship rules to treat corporations as citizens of any foreign state: (1) by which it has been incorporated, and (2) where it has its principal place of business. Treats insurers as citizens of any foreign state: (1) of which the insured is a citizen, (2) by which the insurer has been incorporated, and (3) where the insurer has its principal place of business.
Section 103 -
Separates the removal requirements governing civil cases and those governing criminal cases into two separate categories.
Declares that, upon removal of any civil action with both removable and nonremovable claims, the district court shall sever from the action all nonremovable claims and remand them to the state court from which the action was removed.
Requires only defendants against whom a removable claim has been asserted to join in or consent to removal of the action.
Prescribes requirements for filing notices of removal, including assertion in the notice of the amount in controversy, when it exceeds the necessary amount, if the initial pleading seeks:
(1) nonmonetary relief; or
(2) a money judgment, but the state practice either does not permit demand for a specific sum or permits recovery of damages in excess of the amount demanded.
Allows removal of a case based on diversity of citizenship more than one year after commencement of the action if the district court finds that the plaintiff has acted in bad faith in order to prevent a defendant from removing the action.
Title II - Venue and Transfer Improvements
Section 202 -
Revises general requirements for the scope of venue of civil actions. Requires the proper venue of any civil action brought in a U.S. district court to be determined without regard to whether the action is local or transitory in nature.
Section 203 -
Repeals the "local action" rule that any civil action, of a local nature, involving property located in different districts in the same state, may be brought in any of such districts.
Section 204 -
Allows a district court to transfer a civil action to any district or division to which all parties have consented. Prohibits transfers from a U.S. district court to the District Court of Guam, the District Court for the Northern Mariana Islands, or the District Court of the Virgin Islands.

House Republican Conference Summary

The summary below was written by the House Republican Conference, which is the caucus of Republicans in the House of Representatives.

This summary can be found at http://www.gop.gov/bill/112/1/hr394.

Background

According to the majority staff on the House Committee on the Judiciary, the House approved a similar bill (H.R. 4113) by voice vote under suspension of the rules on September 28, 2010. 

 

The Senate Judiciary Committee insisted on the following minor amendments. 

 

  • Maintaining the status quo treatment of derivative jurisdiction. H.R. 4113 as passed by the House made technical changes to §1441(f) to clarify that the derivative jurisdiction doctrine has no application to other sections within title 28. Prior to 1986, the derivative jurisdiction doctrine meant that if a state court lacked jurisdiction over an exclusively federal matter, removal to federal court under §1441(f) was nonetheless barred because the US district court’s jurisdiction was not “derivative” of the jurisdiction that attached in state court. Justice Department attorneys said that although it is infrequently used, the doctrine of derivative jurisdiction is indeed sometimes invoked by them when suits involving federal officers and agencies are removed to federal court.  They gave as a particular example the situation when a defendant seeking to escape a state court forum brings a third-party action against a federal employee.  If the federal employee was acting within the scope of the employee's employment, the U.S. can remove the case to federal court under 28 USC §1442 & §2679.  The federal court then applies the derivative jurisdiction doctrine and dismisses the third-party claim against the federal employee, remanding the underlying action to state court. DOJ says that in such instances the third-party claim against a federal employee is often brought merely to obtain a federal forum, thereby frustrating the plaintiff's choice of forum.

 

  • A clarification that a district court, and not state court, can make findings regarding the appropriateness of certain removals. This is a non-substantive change.

 

  • Substitution of the generic word “entity” for “party” in one instance, consistent with the context of its usage.  

 

  • Deletion of an extra comma in one provision. 

 

H.R. 394 includes the base text as approved by the House in the 111th Congress along with the Senate changes.  

 

H.R. 394 would attempt to bring clarity to the operation of jurisdictional statutes and facilitate the identification of the appropriate state or federal court where actions should be brought.  Many Judges believe the current rules force them to waste time determining jurisdictional issues at the expense of adjudicating the underlying litigation.  The contents are based on recommendations developed and approved by the United States Judicial Conference.  

Summary

H.R. 394 would make several changes to judicial procedures, including the determination of original jurisdiction and court venue for certain types of cases.  The bill would specify the court of original jurisdiction for certain cases involving resident aliens and corporations.  Lastly, H.R. 394 would change how the venues for federal court cases  are determined, particularly when the cases involve multiple districts.

Cost

According to CBO, H.R. 394 would have no significant budgetary impact.

House Democratic Caucus Summary

The House Democratic Caucus does not provide summaries of bills.

So, yes, we display the House Republican Conference’s summaries when available even if we do not have a Democratic summary available. That’s because we feel it is better to give you as much information as possible, even if we cannot provide every viewpoint.

We’ll be looking for a source of summaries from the other side in the meanwhile.

The bill contains the following citations to other parts of U.S. law:

United States Code

The United States Code is the compilation of permanent laws enacted by Congress. Temporary and other non-permanent laws do not appear in the United States Code. (About half of the United States Code is the law itself, called positive law. The other half is merely a compilation of the laws but has no legal significance.)

Other Citations

  • 28 U.S.C. Chapter 87
  • 28 U.S.C. Chapter 89