Griffin v. Lee
77 Fed. R. Serv. 3d 766, 2010 U.S. App. LEXIS 19816, 621 F.3d 380 (2010)
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Rule of Law:
Federal courts lack supplemental jurisdiction over claims by Rule 24 plaintiff-intervenors in cases where original jurisdiction is founded solely on diversity of citizenship, if exercising such jurisdiction would be inconsistent with the jurisdictional requirements of 28 U.S.C. § 1332 regarding complete diversity or the amount in controversy.
Facts:
- Sylvester Griffin was a beneficiary of a trust and sought its reformation, along with advancing fraud claims against the successor Trustee, JPMorgan Chase Bank, N.A., and its officers.
- Griffin hired attorney Robert A. Lee to represent him in this lawsuit, entering into a contingency fee agreement for Lee's legal services.
- Lee later withdrew from his representation of Griffin in the underlying lawsuit.
- Robert A. Lee was a citizen of Louisiana.
- Sylvester Griffin was a citizen of Mississippi.
- Individual defendants Walter E. Busby, Drew C. Detraz, and Charlotte Ray, who were officers of the Trustee bank, were citizens of Louisiana.
- Lee's claim for attorney's fees based on the contingency agreement initially amounted to $54,087.51, and later he estimated it as $25,000.00 or less.
Procedural Posture:
- Sylvester Griffin filed his Petition for Fraud and Unjust Enrichment and for Return of Monies in Louisiana state court on or about August 25, 2006.
- Defendants (JPMorgan Chase & Co. and others) removed the case to the United States District Court for the Western District of Louisiana, Monroe Division, on September 15, 2006, based solely on diversity jurisdiction (28 U.S.C. § 1332).
- On April 6, 2009, the district court granted Defendants’ Motions for Summary Judgment and dismissed all of Griffin’s claims against them with prejudice, entering Judgment in Defendants’ favor on April 7, 2009.
- On April 7, 2009, Robert A. Lee filed a Motion for Leave to Intervene under Federal Rule of Civil Procedure 24(a)(2) and Motion for Additional Conservatory Relief, seeking a statutory lien upon Griffin’s recovery.
- On April 8, 2009, the district court granted Lee’s Motion to Intervene, concluding Lee was entitled to intervene as of right under Rule 24(a)(2).
- Lee filed his Petition of Intervention for Attorney Fees and Costs on April 8, 2009.
- After a preliminary injunction hearing on April 14, 2009, the district court granted Lee’s Motion for Preliminary Injunction, ordering the Trustee not to disburse $25,000.00 from the trust pending final adjudication of Lee’s Petition of Intervention.
- The district court scheduled a bench trial on the merits of Lee’s Petition for June 29, 2009.
- On July 7, 2009, the district court entered Judgment in favor of Lee and against Griffin on the Petition of Intervention, awarding Lee $16,068.00 in attorney’s fees and imposing a privilege on the trust funds.
- Griffin appealed the district court's judgment to the United States Court of Appeals for the Fifth Circuit, disputing the amount awarded and the imposition of a lien on the Trust.
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Issue:
Does a federal district court, whose original jurisdiction is founded solely on diversity of citizenship under 28 U.S.C. § 1332, possess supplemental jurisdiction under 28 U.S.C. § 1367(b) over a Rule 24 plaintiff-intervenor's claim for attorney's fees against an original plaintiff and other defendants when the intervenor shares citizenship with some defendants and the claim does not meet the amount in controversy requirement of § 1332?
Opinions:
Majority - Per Curiam
No, a federal district court lacks supplemental jurisdiction over a Rule 24 plaintiff-intervenor's claim for attorney's fees if that claim is inconsistent with the jurisdictional requirements of 28 U.S.C. § 1332. The court's original jurisdiction in the underlying lawsuit was founded solely on diversity of citizenship pursuant to 28 U.S.C. § 1332. While 28 U.S.C. § 1367(a) provides a broad grant of supplemental jurisdiction over related claims, including those involving intervention, 28 U.S.C. § 1367(b) specifically limits this in diversity-only cases. Section 1367(b) withholds supplemental jurisdiction over claims by persons seeking to intervene as plaintiffs under Federal Rule of Civil Procedure 24 if exercising such jurisdiction would be inconsistent with the jurisdictional requirements of § 1332. Here, Lee intervened as a plaintiff, and his claim failed on two grounds: first, he was a Louisiana citizen, and some individual defendants in the original action were also Louisiana citizens, thus destroying complete diversity under § 1332; second, his claim for attorney's fees was less than $75,000.00, failing the amount in controversy requirement. The court rejected Lee's arguments that § 1367(b) was inapplicable to removed cases or to collateral claims for attorney's fees in federal question cases (distinguishing them from diversity cases). The court emphasized that the statute's language is unambiguous and cannot be overridden by considerations of convenience or judicial economy.
Analysis:
This case provides a significant clarification on the scope of supplemental jurisdiction under 28 U.S.C. § 1367(b), particularly for plaintiff-intervenors in diversity-only cases. It reinforces the principle that while § 1367(a) offers a broad grant of jurisdiction, § 1367(b) serves as a critical statutory limitation designed to prevent parties from circumventing the complete diversity and amount in controversy requirements of § 1332. The ruling underscores that even claims closely related to the original action, such as an attorney's fee dispute, cannot bypass these fundamental jurisdictional hurdles if the intervenor's presence defeats the core principles of diversity jurisdiction. This case will likely impact future litigation involving attorney's liens or fee disputes in federal courts where the underlying jurisdiction is solely based on diversity, pushing such claims to state courts when the intervenor's citizenship or claim amount would otherwise destroy federal jurisdiction.
