Wachovia Bank v. Schmidt

Under 28 U.S.C. § 1332(a)(1), federal district courts were given authority to adjudicate civil actions between citizens of different states if the amount in controversy was greater than $75,000. Under § 1332(c)(1), a corporation, for diversity-jurisdiction purposes, was a citizen of any state where it was incorporated and also where it maintained a principal place of business. The National Banking Act stated that national banking associations were citizens of the states in which they were located; 28 U.S.C. § 1348 also prescribed that national banks were citizens of the states in which they were “located,” and it stated that in certain situations, a district court had jurisdiction over actions involving a banking association “established” in the district where the court sits. Pursuant to § 1348, the Fourth Circuit stated that the dictionary definition of “located” referred to a physical presence, the terms “established” and “located” were intentionally given independent meanings, and under in pari materia, “located” should be interpreted the same as it was by the Supreme Court in Citizens & Southern National Bank v. Bougas. The Fourth Circuit held that Wachovia Bank (plaintiff) was located in all 16 states where it had a branch office and was therefore a citizen of each of these states. Wachovia Bank appealed the holding to the United State Supreme Court.