The Federal District Court has exclusive jurisdiction over any case involving diversity of citizenship.

Question

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The statement in question is addressing the nature of jurisdiction over diversity of citizenship cases in the federal system.
Option 1: True. If we were to consider this option as true, we would be claiming that federal district courts have exclusive jurisdiction in all diversity of citizenship cases. In reality, this is not accurate. Diversity jurisdiction in the United States is federal question jurisdiction that provides relief in federal courts, but it is not exclusive to them; state courts may exercise jurisdiction over such cases when the case is properly brought there, and there is no requirement that every diversity case must go to federal court. The concept of exclusive jurisdiction would imply that only federal courts could hear these cases, which is inconsistent with the principle of concurrent jurisdiction that can exist between federal and state courts.
Option 2: False. This option correctly reflects the typical framework: federal district courts have original jurisdiction over diversity cases, but this jurisdiction is not exclusive because state courts can also hear cases involving diversity of citizenship under appropriate circumstances. The doctrine of concurrent jurisdiction means plaintiffs may choose to file in federal court or in state court, provided the federal jurisdictional requirements (such as complete diversity and an amount in controversy exceeding the statutory threshold) are satisfied, and there is no constitutional or statutory constraint that bars state-court handling of such matters. Misconceptions often arise from conflating federal jurisdiction with exclusivity, but the proper understanding is that diversity cases are not exclusively federal.
Why the other options misstate things: If someone answered True, they would be overlooking the concurrent nature of jurisdiction and the possible preservation of state-court proceedings for diversity matters. If someone answered False but without recognizing the precise structure of original jurisdiction and concurrent options, they might not appreciate that federal courts can hear these cases but are not the sole venue. In short, the correct framing is that diversity of citizenship cases can be heard in either federal or state courts under appropriate conditions, so the statement claiming exclusivity is inaccurate.

BUSFIN 3500 SP2025 (4686) Chapter 3 Quiz

The Federal District Court has exclusive jurisdiction over any case involving diversity of citizenship.

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