Bank of the United States v. Deveaux

Bank of the United States v. Deveaux, 5 Cranch (9 U.S.) 61 (1809), argued 10–11 Feb. 1809, decided 15 Mar. 1809 by vote of 6 to 0; Marshall for the Court, Livingston not participating. The Constitution gives federal courts jurisdiction over cases between citizens of different states (this is known as diversity jurisdiction). Deveaux involved the issue of whether a corporation can sue or be sued in a federal court under diversity jurisdiction and, if so, how the citizenship of the corporation is to be determined for diversity purposes. The Bank of the United States sued Deveaux, a Georgia tax collector, in federal court to recover property he had seized when the bank refused to pay a Georgia tax. Deveaux argued that the federal court had no jurisdiction because the bank as a corporation was not a citizen for purposes of diversity of citizenship jurisdiction and, in the alternative, that if the bank was a citizen, there was no diversity since some of its shareholders resided in Georgia. The Court held that a corporation was a “citizen” for purposes of diversity jurisdiction but that there was no diversity in this case because the citizenship of the corporation was to be determined by the citizenship of its shareholders, some of whom resided in the same state as the defendant. Later, Marshall and other members of the Court reportedly expressed regret over the decision because it severely limited the right of corporations to sue or be sued in federal court and thereby diminished federal judicial power. But Deveaux remained valid until it was overruled in Louisville Railroad Co. v. Letson (1844), which held that the citizenship of a corporation for diversity purposes was that of the state that chartered it.

See also Judicial Power and Jurisdiction; Lower Federal Courts.

Robert M. Ireland