“Standing, Not Merits”: Sixth Circuit Re-affirms the Wall between Article III Standing and State-Law Causes of Action in Stewart v. Martin

1. Introduction

Court & Date: United States Court of Appeals for the Sixth Circuit, 7 July 2025.
Panel: Judges Clay, Thapar (author), and Readler.
Appeal Nos.: 24-3648 / 24-3708.

The Martin family litigation, stemming from the estate of world-renowned surgeon Dr. Lester Martin, asked two headline questions: (1) did the federal district court possess subject-matter jurisdiction over a diversity suit brought by two grandchildren against their uncle-trustee, and (2) if so, must those grandchildren have offered expert testimony to prove damages?

Judge Thapar’s opinion squarely answered the first: the district court did possess jurisdiction because the grandchildren met the constitutional requirements of Article III standing, even if Ohio law may ultimately deny them a viable cause of action. Emphasising the Supreme Court’s decision in Lexmark v. Static Control, the panel clarified that an absence—or even potential absence—of a state-law cause of action goes to the merits, not to standing. The judgment therefore vacates the district court’s Rule 60(b)(4) order voiding the earlier jury verdict and remands for resolution of a pending Rule 50(b) motion on damages.

2. Summary of the Judgment

Article III Standing Confirmed. Daniel Stewart and Rachel Kosoff alleged a concrete monetary injury ($2.086 million), causally linked to distributions their uncle/trustee David Martin made, and redressable by a damages award. Those allegations satisfy Lujan’s injury-in-fact, causation, and redressability prongs.
Cause of Action ≠ Standing. Even assuming Ohio trust law affords no beneficiary action during a settlor’s lifetime, that statutory gap affects only whether a claim ultimately prevails—not whether federal courts have the power to hear the dispute under Article III.
No “Wholly Frivolous” Exception. The “wholly insubstantial and frivolous” route to dismissal, referenced in Steel Co., concerns federal-question jurisdiction and has no bearing in a diversity case grounded in a real monetary injury.
Protective Cross-Appeal Preserved. Because standing exists, the panel remands for the district court to rule on David Martin’s unresolved Rule 50(b) motion challenging the sufficiency (and alleged need for expert proof) of damages evidence.

3. Analysis

3.1 Precedents Cited and Their Influence

Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992)
Provided the constitutional three-part standing test. The Sixth Circuit applied it mechanically to find injury, causation, and redressability.
Lexmark Int’l, Inc. v. Static Control Components, Inc., 572 U.S. 118 (2014)
Core authority for the distinction between Article III standing and statutory cause of action (sometimes labelled “prudential standing”). Judge Thapar borrowed its analytic structure—first confirm constitutional standing, then ask whether any legal right of action exists, stressing they are conceptually separable.
Steel Co. v. Citizens for a Better Environment, 523 U.S. 83 (1998)
Clarifies that lack of a cause of action is merits-based, though it recognises the “wholly insubstantial and frivolous” doctrine for federal-question cases. The opinion explains why that doctrine does not extend to Article III standing or to diversity cases.
CHKRS, LLC v. City of Dublin, 984 F.3d 483 (6th Cir. 2021); Charlton-Perkins v. University of Cincinnati, 35 F.4th 1053 (6th Cir. 2022)
Sixth Circuit precedents underscoring that a claim’s potential failure on the merits does not deprive courts of jurisdiction. Both are quoted to illustrate intra-circuit consistency.
Hasselbring v. Bernard, 139 N.E.3d 1285 (Ohio Ct.App. 2019); Osborn v. Griffin, 865 F.3d 417 (6th Cir. 2017)
Address Ohio’s approach to fiduciary duties in revocable trusts, acknowledging that trustees owe duties only to the settlor while the trust is revocable. These cases lend credence to David’s merits argument—even as the panel refuses to treat that issue as jurisdictional.

3.2 Court’s Legal Reasoning

The panel’s reasoning follows a two-step syllogism:

Standing Step. Monetary loss alleged → classic concrete injury → traceable to trustee’s conduct → redressable by monetary award → Article III satisfied.
Merits Step. Whether Ohio trust law provides a beneficiary action during the settlor’s life is a merits inquiry. Even if the answer is “no,” federal jurisdiction, grounded in diversity and a genuine case or controversy, remains intact.

The opinion robustly rejects the manoeuvre of relabelling a merits defect as a jurisdictional one. Doing so would, as Judge Thapar warns, transform every losing defense into a constitutional dismissal, “forcing courts to raise defenses that a defendant may never have raised” and improperly collapsing the separation between adjudicative capacity and claim viability.

3.3 Potential Impact

Jurisdictional Clarity. Litigants can no longer invoke alleged deficiencies in state-law causes of action to void adverse judgments under Rule 60(b)(4) in the Sixth Circuit, unless the underlying claim is truly frivolous in the Article III sense.
Estate & Trust Litigation. Beneficiaries of revocable trusts may test trustees’ conduct in federal court (under diversity) without first overcoming the uncertain hurdle of statutorily-defined standing. Trustees cannot escape suit by asserting, post-judgment, that state law disallowed the claim.
Procedural Strategy. Defendants wishing to press state-law “no-cause-of-action” arguments must do so through motions to dismiss for failure to state a claim (Rule 12(b)(6)) or on summary judgment—not through jurisdictional attacks.
Remand Guidance. On remand, the district court’s forthcoming ruling on whether expert testimony is necessary to quantify damages in trust disputes may itself generate new precedent on proof standards under Ohio law.

4. Complex Concepts Simplified

Article III Standing: The constitutional requirement that a plaintiff show (1) a concrete, particularised injury, (2) caused by the defendant, and (3) that a court can remedy the injury.
Cause of Action: The legal right created by statute or common law that entitles a plaintiff to relief. A plaintiff can have standing yet still lose if no valid cause of action exists.
Revocable Trust: An estate-planning instrument that the settlor can amend or revoke during his lifetime. Trustees of revocable trusts typically owe fiduciary duties only to the settlor while he lives.
Rule 60(b)(4) Motion: A request asking a court to declare its own judgment “void” for lack of jurisdiction or other fundamental defect. It is one of the few avenues to reopen a final judgment.
“Wholly Insubstantial and Frivolous” Doctrine: An exception to federal-question jurisdiction allowing dismissal where the asserted federal claim is obviously meritless. It does not apply to genuine state-law claims in diversity cases.
Protective Cross-Appeal: A procedural device allowing an appellee to challenge other aspects of a judgment contingent upon reversal of the part that favoured him.

5. Conclusion

Stewart v. Martin provides a textbook reaffirmation of the “standing-versus-merits” divide. By vacating the district court’s attempt to treat a possible state-law deficiency as a jurisdictional void, the Sixth Circuit safeguards the structural limits of Article III and instructs practitioners that jurisdictional arguments cannot be used as an after-the-fact escape hatch from an unfavourable verdict. The ruling will guide lower courts confronting similar trust-beneficiary disputes and broader civil litigation where parties conflate the existence of a legal right with the power of a federal court to adjudicate. All eyes now turn to the district court’s handling of the damages question—an issue that could further shape Ohio fiduciary-duty jurisprudence but will now proceed on the correct jurisdictional footing.