Saturday, May 17, 2014

Grable & Sons Metal Products v. Darue case brief summary

Grable & Sons Metal Products v. Darue (2005):
 IRS seized Grable's land for nonpayment of taxes, and sold at public auction to Darue. Grable sues Darue for quiet title, alleging that the IRS didn't give him required notice and so their seizure, and hence Darue's title, was invalid. The question was whether the state-law claim necessarily raised a stated federal issue, actually disputed and substantial, which a federal forum could entertain without disturbing any congressionally approved balance of federal and state judicial responsibilities. This case warranted federal jurisdiction because the owner's claim was premised on the IRS's failure to give adequate notice as defined by federal law. Thus, whether notice was given within the meaning of that federal law was an essential element (i.e. the only element) of the quiet title claim and the meaning of the federal statute was actually in dispute. Also the statute's meaning belonged in federal court given the government's strong interest in tax collection. Furthermore, there was not a strong possibility that allowing FQJ here would lead to a disturbance of judicial responsibilities, because this would be a rare issue and so federal courts would not be swamped. The court held that Merrell, when read in its entirety, treated the absence of a federal private right of action as evidence relevant to, but not dispositive of, the sensitive judgments about congressional intent that § 1331 requires.
State of the law after Grable: FQ must appear on the face of a well-pleaded complaint, and the cause of action must be created by the federal law in question. But, if adjudication really requires interpretation of federal law, there is FQJ. Unless the case involves a statutory violation, and Congress intended to deny a federal right of action. Evidence that Congress intended to deny a private right of action is relevant to FQJ inquiry (updated Merrell). FQJ is allowed if the cause of action sufficiently implicates a federal law. 
Case can sufficiently implicate federal law if (1) the FQ is an "essential element" of the claim, (2) the federal issue is "actually in dispute" and "an important issue of federal law," and (3) federal jurisdiction will not disturb any congressionally approved balance of federal and state judicial responsibilities.

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