Senators Coons, Kennedy bipartisan bill to update federal diversity jurisdiction threshold passes Senate

WASHINGTON - U.S. Senators Chris Coons (D-Del.) and John Kennedy (R-La.), both members of the Senate Judiciary Committee, celebrated Senate passage of their bipartisan Diversity Jurisdiction Inflation Adjustment Act, legislation that would update the dollar threshold for certain state-law lawsuits between parties from different states to be heard in federal court.

"Federal courts and judges are already stretched too thin without having to handle low-dollar civil suits that Congress has long intended should be argued in front of state courts," said Senator Coons. "Fixing outdated thresholds and indexing them for inflation ensure more cases will end up in front of the judges who are best positioned to hear them, streamlining court caseloads and helping justice move faster for every American. I'm grateful to see this measure pass the Senate unanimously and move closer to easing the burden on our busy court system."

"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 Senator Kennedy.

Federal diversity jurisdiction allows federal courts to hear certain 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 meet a minimum dollar amount, known as the amount-in-controversy requirement.

In 1996, Congress updated the dollar threshold to $75,000 to account for inflation, but hasn't changed it since. In 2021, the Judicial Conference of the United States recommended the amount be increased to $150,000, which would be equivalent to $187,000 today.

The Diversity Jurisdiction Inflation Adjustment Act would:

• Allow federal courts to hear state-law disputes between parties from different states so long as the amount-in-controversy requirement is satisfied
• Raise the amount-in-controversy requirement to $150,000
• Index the amount-in-controversy requirement to inflation every 10 years
• Improve judicial efficiency by limiting state-law cases in federal courts

In addition to Senators Coons and Kennedy, the legislation is sponsored by U.S. Senators Ted Cruz (R-Texas) and Sheldon Whitehouse (D-R.I.).

Read the full text of the bill here.