Jurisdiction over Cases “Arising under” Federal Law
Our first three chapters dealt with personal jurisdiction---the power of a court to require a defendant from outside the state to defend a lawsuit in that state. Now we turn to subject matter jurisdiction, a separate, additional requirement for a court to hear a case. Suppose, for example, that Engle wishes to sue her employer, Consolidated Packing Corporation, after she is fired from her job for reporting acts of fraud committed by Consolidated officers to federal authorities. She needs to choose a court that has personal jurisdiction over Consolidated for her claim, but she must also choose one that can hear the type of lawsuit she plans to file against Consolidated.
To understand the principles governing subject matter jurisdiction in American courts, we have to start with those courts themselves. The United States Constitution created a system of divided sovereignty, in which the states and the national or “federal” government share power. Not only is legislative power split between the two levels of government, but the judicial power is as well. Thus, in every state there is a state court system and a branch of the federal court system. Some cases must be brought in the state courts. Others (though not many) must be brought in federal court. And still others may be filed in either court system. The trick is to know which ones go where, and that depends on which court has “subject matter jurisdiction” over the case, that is, the power to hear the particular type of case the plaintiff plans to file.