On the Death of Diversity Jurisdiction: An Empirical Study Establishing That Diversity Jurisdiction Is No Longer Justified

Abstract

American federal diversity jurisdiction was created in response to the concern that out-of-state litigants would suffer bias in state court due to their out-of-state status (“geographic bias”). As attested in the record from the state ratification conventions, in the legislative history of diversity jurisdiction, and in seventeen U.S. Supreme Court opinions (the most recent in 2021), the creation of an impartial tribunal to mitigate geographic bias was and is the central rationale for federal diversity jurisdiction. Even though geographic bias is the rationale for diversity jurisdiction, no (prior) empirical studies have established whether geographic bias remains a problem in the American civil justice system. This Article provides the results of an empirical study of objective data, representing over one million cases across thirty years, demonstrating that geographic bias is no longer an issue in the civil justice system. Given that this result eliminates the very reason for the existence of federal diversity jurisdiction, the outcome provides a strong basis for Congress
to either modify or abolish diversity jurisdiction.