Healy v. Ratta

Healy v. Ratta, 292 U.S. 264 (1934)

The actual issue in the case isn't so relevant, but here's some language: "The power reserved to the states, under the Constitution, to provide for the determination of controversies in their courts may be restricted only by the action of Congress in conformity to the judiciary sections of the Constitution." 270

Does this mean that Congress can act outside of its Article I limits in granting power to the Courts? That seems to be the understanding, that state sovereignty as far as judicial matters is only limited by Article III.

On the other hand, that gets us back to reading Article I into Article III -- the court can't hear anything (under federal question) that Congress doesn't pass, so isn't that equivalent to saying that the court can't hear anything Congress can't pass, or is there a distinction between "doesn't" and "can't"?

References

Kline v. Burke Construction Co., 260 U.S. 226 (????)