Diversity of Citizenship

Definition - What does Diversity of Citizenship mean?

Diversity of citizenship is a term which refers to a situation when each party in a lawsuit is a citizen of a different state or country. There also must be legal damages in excess of $75,000.00. This includes corporations as well as individuals. In terms of citizenship, a corporation has its citizenship where it is incorporated, or where it conducts its business. Diversity of citizenship is a relevant distinction for judicial jurisdiction. If there is diversity of citizenship in a case, then the federal court has jurisdiction over the case.

Justipedia explains Diversity of Citizenship

Cases between two citizens of the same state are often handled by the state court. However, when one of the parties involved is not a citizen of the state, then the federal court has jurisdiction if the amount in question will have at least $75,000.00 in damages. This concept is known as diversity of citizenship. Article III, Section 2 of the U.S. Constitution declares that cases with diversity of citizenship be handled by the federal court. An example of a case with diversity of citizenship can be seen in an auto accident. If a family from Kansas is on vacation in California is in an auto accident that will require at least $75,000.00 in damage, it would be a case with diversity of citizenship.

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