Legal Definitions - aggregation doctrine

The aggregation doctrine is a legal principle that prevents a party from combining the monetary value of several smaller, individual claims to meet the minimum financial threshold required for a case to be heard in federal court based on "diversity jurisdiction." This rule ensures that federal courts only handle cases that genuinely involve a substantial amount of money, rather than allowing parties to artificially inflate the value of their dispute by adding together unrelated or individually insufficient claims.

To understand this, it's helpful to know that federal courts can hear cases between citizens of different states (known as diversity jurisdiction) only if the amount of money or value in dispute (the amount in controversy) exceeds a specific threshold, which is currently $75,000. The aggregation doctrine generally prohibits parties from adding up multiple smaller claims, each individually below this $75,000 threshold, simply to gain access to federal court.

Here are some examples to illustrate the aggregation doctrine:

• Example 1: Single Plaintiff with Multiple Distinct Claims

  Imagine a small business owner, located in Ohio, who has three separate, unpaid invoices from a client in Michigan. One invoice is for $25,000, another for $30,000, and a third for $20,000. Individually, none of these claims meet the $75,000 federal diversity jurisdiction threshold. The aggregation doctrine would prevent the Ohio business owner from adding these three claims together to reach a total of $75,000 (or $75,000.01) and thereby qualify for federal court. Since each claim is distinct and separate, they would likely need to pursue these claims in a state court, even though the total sum across all invoices equals the threshold amount.

  How it illustrates the doctrine: This scenario demonstrates how a single party cannot combine multiple, separate claims, each individually below the jurisdictional threshold, to meet the amount in controversy requirement for federal court.

• Example 2: Multiple Plaintiffs with Separate Claims Against One Defendant

  Consider a situation where five different tenants, all living in different states from their landlord, each sue the same landlord for $15,000 due to unreturned security deposits and minor property damage. While the total amount across all five tenants is $75,000, the aggregation doctrine would generally prevent these five tenants from combining their individual $15,000 claims to meet the federal diversity jurisdiction threshold. Each tenant's claim is separate and distinct, and must individually meet the $75,000 threshold to be heard in federal court (unless a specific exception, such as a class action lawsuit, applies, which operates under different rules).

  How it illustrates the doctrine: This example shows that multiple parties with separate and distinct claims against a single defendant cannot simply add their claims together to satisfy the amount in controversy requirement for federal court.

• Example 3: Single Plaintiff with Separate Claims Against Multiple Defendants

  Suppose a homeowner in Florida suffers $60,000 in damages due to a series of issues with a newly built house. The homeowner believes that two different contractors are responsible for separate portions of the damage: Contractor A is responsible for $30,000 related to the roof, and Contractor B is responsible for $30,000 related to the foundation. If the homeowner sues both contractors, who are citizens of different states, the aggregation doctrine would apply if the liability of each contractor is considered separate and distinct. The homeowner could not aggregate the $30,000 claim against Contractor A with the $30,000 claim against Contractor B to meet the $75,000 federal diversity jurisdiction threshold, as each individual claim against a specific contractor falls below the required amount.

  How it illustrates the doctrine: This scenario demonstrates that even if a single plaintiff sues multiple defendants, if the claims against each defendant are separate and individually below the jurisdictional threshold, they cannot be aggregated to meet the federal court's amount in controversy requirement.