Once you find yourself in a business dispute, there are many decisions you’ll have to make, which is why it is beneficial to have a skilled Florida business litigation attorney on your side. Sometimes, as a recent case that originated in South Florida demonstrates, that decision is determining where you will litigate your case. It is extremely important to choose wisely, as picking federal court when there is no federal court jurisdiction can lead to dismissal.
In that case that was recently ruled upon by a federal appeals court, a West Palm Beach LLC was in the business of selling children’s car seats. The LLC held the patents to those seats as an assignee. The LLC inked a patent licensing agreement with a California entity for the latter to market the seats in exchange of for royalty payments. Eventually, a dispute arose over an unpaid royalty the Palm Beach County LLC alleged it was owed, and the dispute proceeded to federal court in South Florida.
During the appeal process, the 11th Circuit pointed out a problem. The case had relied upon something called “diversity jurisdiction,” which is when an action involves “an amount in controversy exceeding $75,000 and a claim between citizens of different states.” The case clearly involved an amount greater than $75,000, and it involved a Florida LLC versus a California LLC, so what, you may ask, was the problem?