A consumer sues two mortgage brokers in federal court for alleged lending-law disclosures. The first broker asserts a crossclaim against the second alleging the second underpaid him under federal wage laws. Should the court grant dismissal of the crossclaim?

A consumer sues two mortgage brokers in federal court for alleged lending-law disclosures. The first broker asserts a crossclaim against the second alleging the second underpaid him under federal wage laws. Should the court grant dismissal of the crossclaim?

• A. No, because the crossclaim satisfies the amount-in-controversy requirement.
• B. No, because the court has subject-matter jurisdiction over the crossclaim.
• C. Yes, because the crossclaim does not arise out of the same transaction or occurrence as the original action.
• D. Yes, because all parties are citizens of the same state, destroying diversity.

Answer: (C)

The main concept is that a crossclaim between co-defendants must arise out of the same transaction or occurrence as the subject matter of the original action (or as a counterclaim). In this scenario, the original suit involves lending-law disclosures by the two mortgage brokers. The crossclaim, however, is about federal wage-law underpayment between the two brokers—a separate employment dispute with no necessary factual connection to the consumer’s disclosure claim. Because there is no common nucleus of operative fact tying the wage-dispute claim to the disclosures case, the crossclaim does not arise out of the same transaction or occurrence as the original action. Under Rule 13, that means the crossclaim cannot be maintained as a crossclaim in this federal suit and should be dismissed. If the wage dispute were to proceed, it would need to be pursued in a separate action or otherwise satisfy its own independent basis for jurisdiction, rather than as a crossclaim in this case.

The main concept is that a crossclaim between co-defendants must arise out of the same transaction or occurrence as the subject matter of the original action (or as a counterclaim). In this scenario, the original suit involves lending-law disclosures by the two mortgage brokers. The crossclaim, however, is about federal wage-law underpayment between the two brokers—a separate employment dispute with no necessary factual connection to the consumer’s disclosure claim. Because there is no common nucleus of operative fact tying the wage-dispute claim to the disclosures case, the crossclaim does not arise out of the same transaction or occurrence as the original action. Under Rule 13, that means the crossclaim cannot be maintained as a crossclaim in this federal suit and should be dismissed. If the wage dispute were to proceed, it would need to be pursued in a separate action or otherwise satisfy its own independent basis for jurisdiction, rather than as a crossclaim in this case.