A more thorough explanation:

Diversity jurisdiction is a way for a federal court to have the power to hear a case. It is one of two ways, the other being federal question jurisdiction.

For a federal court to have diversity jurisdiction, two things must be true:

1. The amount of money involved in the case must be more than $75,000.
2. The people involved in the case must be from different states.

For example, if someone from California sues someone from New York for $100,000, a federal court could hear the case because there is diversity jurisdiction.

However, if someone from California sues someone else from California for $100,000, a federal court could not hear the case because there is no diversity jurisdiction.

It's important to note that if diversity jurisdiction exists, the defendant can choose to move the case from state court to federal court.

Also, if there is a class action lawsuit, the rules for diversity jurisdiction are a little different. In that case, only one person needs to be from a different state than the defendant for the federal court to have jurisdiction.

Finally, if a federal court has diversity jurisdiction, it must follow the laws of the state where the case is being heard.

For example, if a federal court in California hears a case because of diversity jurisdiction, it must follow California law.