When it comes to the question of where to litigate business matters, is it better to litigate business matters in State or Federal Court? If you are planning to bring a lawsuit or if you have been sued, you may have the possibility of filing in state or federal court or possibly removing a state-court case to federal court with a  petition for removal. If you do have a choice, this is something you’ll want to discuss with your Arizona business litigation attorney. There are several factors to consider in determining what is best for your case.

Federal Court

Whether or not federal court is an option has to do with some jurisdictional factors that an attorney can walk you through. One such example is figuring out in which state your corporation actually resides.

Some cases are required to go through federal court. Some of the most common examples include:


Suits involving refund of federal taxes

Copyright and patent infringement

Cases involving federal antitrust laws

These cases involve situations where federal jurisdiction on the matter is exclusive.

State Court

There are far more cases that must be brought in state court. This is when the issues in the case involve interpretation and application of state laws and where at least one defendant and the plaintiff live in the same state.

Choosing Between State and Federal Court

There are yet other cases in which you are eligible to decide whether or not you want to bring the case in state or federal court. You may be allowed to make this choice if you and the other parties all live in different states, for example. If your claim as a plaintiff involves excess of a particular amount or if your allegations are based on federal laws that Congress has affirmed can be tried in either state or federal court, you can choose between the two.

Many business cases are eligible to go through federal court because of what’s known as diversity jurisdiction. Cases in state court could even be removed to federal courts if there are concerns about diversity jurisdiction and if no one defendant lives in the state where the case was initially brought and the lawsuit has an amount in controversy of $75,000 or more.

How to Make the Final Decision

Each business litigation case is unique and making a decision like this requires careful thought. You should only make this decision after you have had the opportunity to consult with your Arizona business attorney. There are many factors involved in how your case will be handled and only a knowledgeable attorney should provide you with advice about whether state or federal court is more appropriate.

This blog should be used for informational purposes only. It does not create an attorney-client relationship with any reader and should not be construed as legal advice. If you need legal advice regarding Where to Litigate Business Matters, or any other litigation matters,  please feel free to contact Roger C. Decker at  480.461.5343, log on to udallshumway.com,  or contact an attorney in your area. Udall Shumway PLC is located in Mesa, Arizona and is a full service law firm. We assist Individuals, families, businesses, schools and municipalities in Mesa and the Phoenix/East Valley.