The Constitution established a Supreme Court but left almost everything else about the federal judiciary to Congress. The act, drafted largely by Senator Oliver Ellsworth of Connecticut, created 13 district courts and three circuit courts, set out their jurisdiction and required Supreme Court justices to "ride circuit" to hear cases around the country. That same day Washington nominated John Jay as the first chief justice. One section of the act was later struck down in Marbury v. Madison.
The first Congress met in New York in 1789 and faced the task of building a government almost from scratch. Americans were divided over how powerful federal courts should be, and Anti-Federalists feared they would overwhelm state courts. Ellsworth, a lawyer who later became chief justice, produced a compromise that gave federal courts limited jurisdiction and allowed many cases to remain in state courts.
The act, known formally as "An Act to establish the Judicial Courts of the United States", created one district court in each state, plus separate districts for Maine and Kentucky, which were still parts of Massachusetts and Virginia. It made the Supreme Court the final judge of certain state-court decisions involving federal law. It also created the post of attorney general and of US marshals.
The requirement that justices travel to hold circuit courts proved exhausting on the roads of the time, and it was one reason John Jay resigned to become governor of New York. In 1803 Chief Justice John Marshall ruled in Marbury v. Madison that part of Section 13 was unconstitutional, the first time the Supreme Court struck down an act of Congress.
Key people: George Washington, Oliver Ellsworth, John Jay