Sponsors
The bill reduces federal caseloads and saves judicial resources by keeping smaller diversity cases in state courts, but it restricts access to federal forums and risks higher costs, delays, and less uniform outcomes for many litigants.
Taxpayers and users of the federal courts: the bill shifts many lower‑value (under $500,000) diversity suits to state courts, reducing federal caseloads and lowering federal judicial spending per case so resources can focus on higher‑value federal matters.
Small businesses and plaintiffs involved in high‑stakes interstate disputes: concentrating higher‑value cases in federal courts may make forum choice and litigation expectations clearer and more predictable for those parties.
Plaintiffs (including many small businesses) with claims under $500,000: the bill limits access to federal courts for their disputes, forcing them into state courts that may be less neutral for out‑of‑state parties and offering different procedural protections.
Plaintiffs and defendants (and ultimately taxpayers): shifting many cases to varied state dockets could raise litigation costs, create delays, and increase procedural complexity because state court backlogs and rules differ across jurisdictions.
Nationwide businesses, local governments, and parties in interstate commerce: moving many diversity cases out of federal courts may reduce federal oversight and produce less uniform interpretation of interstate commercial law across states.
Based on analysis of 2 sections of legislative text.
Raises the federal diversity jurisdiction amount-in-controversy threshold from $75,000 to $500,000 for new civil actions.
Introduced April 22, 2026 by Laurel Lee · Last progress April 22, 2026
Raises the federal diversity jurisdiction amount in controversy threshold from $75,000 to $500,000 for civil cases filed after the law takes effect. The change means fewer state-law disputes with claims under $500,000 will be eligible for federal court based on diversity of citizenship, which will likely keep more cases in state courts and reduce removals to federal court.