History of the Federal Judiciary
One of the many shortcomings of the Articles of Confederation was that it lacked a national judiciary. The delegates who gathered in Philadelphia for the Constitutional Convention realized this, and set out to correct the problem.
However, there were great differences over the exact shape of the judicial branch. The Federalists, proponents of a strong national government, believed that the federal judiciary should consist of trial courts, appellate courts, and one supreme tribunal. The antifederalists, supporters of states' rights, were concerned that an integrated federal judiciary would usurp the states' authority and embolden the federal government. Instead of a three-tier federal judiciary, they proposed that state courts serve as the trial and appellate courts. A national supreme court would hear final appeals.
One of the antifederalists' biggest concerns was that trials in federal court would be biased against the defendants and would not offer the same protection as did the state courts. They won two key concessions in this regard: The Judiciary Act guaranteed defendants in federal court the right to trial in their district of residence, and also provided that jury selection in federal court would be consistent with the jury selection method of the state in which the district is located.
Like many of the debates that took place in Philadelphia, the dispute over the federal judiciary ultimately ended in compromise, found in Article III of the Constitution: “The judicial Power of the United States shall be vested in one supreme Court, and in such inferior Courts as the Congress may from time to time ordain and establish.” Essentially, it was left to Congress to resolve the issue.
Congress wasted little time in doing just that, passing the Judiciary Act of 1789 in its very first session. The bill picked up where the Constitutional Convention left off, forging further compromise between the Federalist and antifederalist factions. The act constructed a three-tier federal judiciary by adding a trial and appellate level, just as the Federalists wanted. At the same time, it limited the jurisdiction of the federal courts, set a high monetary threshold for diversity cases (cases where the litigants are from different states), and gave the state courts concurrent jurisdiction over many federal issues — three provisions the antifederalists insisted upon. In the end, both sides were satisfied with the outcome. The fact that federal judiciary has changed so little over the past two centuries is a testament to its genius.