Kennedy, Coons bipartisan bill to improve federal court efficiency passes U.S. Senate

WASHINGTON - Sen. John Kennedy (R-La.), a member of the Senate Judiciary Committee, announced that the U.S. Senate passed his bipartisan Diversity Jurisdiction Inflation Adjustment Act, which he introduced with Sen. Chris Coons (D-Del.) to update the dollar threshold for certain state-law lawsuits between parties from different states to be heard in federal court.

Federal diversity jurisdiction allows federal courts to hear state-law disputes between parties from different states. To prevent federal courts from being flooded with lower-value state-law claims, Congress requires these lawsuits to meet a minimum dollar amount, known as the amount in controversy requirement.

Congress last updated that threshold in 1996, when it set the amount at $75,000. Because of inflation, $75,000 in 1996 is worth more than $150,000 today. The Judicial Conference of the United States, where federal judges meet to discuss policies affecting the courts, recommended the amount be increased to $150,000 in 2021.

The bipartisan Diversity Jurisdiction Inflation Adjustment Act would raise the federal diversity jurisdiction threshold from $75,000 to $150,000 and adjust the threshold for inflation every 10 years.

"Federal judges already have plenty on their plate, and Congress ought to respect their limited time and resources. Our bipartisan bill updates a 30-year-old threshold, preserves the role of state courts and makes our federal judiciary more efficient. I'm glad the Senate passed this common-sense fix," said Kennedy.

Sens. Ted Cruz (R-Texas) and Sheldon Whitehouse (D-R.I.) are cosponsors of the legislation.

Background:

The Diversity Jurisdiction Inflation Adjustment Act would:

• Raise the amount in controversy requirement from $75,000 to $150,000.
• Index the threshold to inflation every 10 years.
• Help prevent federal courts from being burdened with lower-value state-law claims.
• Preserve the balance between state and federal courts by keeping more state-law claims in state courts.
• Improve judicial efficiency by helping federal courts focus on disputes that are more appropriate for federal jurisdiction.

Full text of the Diversity Jurisdiction Inflation Adjustment Act is available here.