Matter of Dunn

Background

A group of Texas plaintiffs sued the Texas & Pacific Railway Company (a corporation created by an act of Congress) and two individual men in a state court in the Northern District of Texas. The individuals named, Slayter and Rasmussen, lived in the Eastern District of Texas. The railway company had an office and agent in Dallas. Plaintiffs joined all defendants in one lawsuit that raised federal-law issues. Defendants moved to remove the case to federal court, and the question reached the Supreme Court.

Reasoning

The main question was whether the case could be removed from state court to the federal Circuit Court even though two individual defendants lived in a different district. The Court said a suit against a corporation created by Congress arises under federal law. Because the plaintiffs joined the individual defendants with the federal corporation in one joint claim, the whole case took on a federal character and became removable. The Court also relied on a 1902 statute allowing suits in a district where one defendant resides and the use of duplicate writs to notify others. The opinion discussed earlier cases and examples showing how a federal issue can give the whole suit a federal character.

Real world impact

The ruling allows companies created by Congress, joined with local individuals, to move such joint lawsuits into federal court. It means plaintiffs’ decision to join parties can determine whether a case is heard in state or federal court. Individual defendants living elsewhere can be reached by duplicate writs under the 1902 statute so the federal court can obtain jurisdiction. The Circuit Court obtained jurisdiction, the rule to show cause was discharged, and the mandamus proceedings were dismissed.

Dissents or concurrances

Justice Harlan dissented from the Court’s decision, opposing the majority's conclusion.