Which of the following cases would likely be heard in federal courts?

Disputes between states are typically considered to fall under the original jurisdiction of federal courts. This jurisdiction means that these cases can be initially heard in federal court rather than in state court. The U.S. Constitution provides for federal jurisdiction in cases where states are parties, primarily to ensure impartiality and fairness in disputes that may arise between states. These cases often involve issues that could be significant to multiple states, such as border disputes, water rights, and other conflicts that transcend state lines.

In contrast, the other options reflect matters that are generally handled by state courts. Minor contractual disputes and local business licensing issues usually fall under state law jurisdiction, as they pertain to transactions and regulations within a single state's borders. Cases like violations of state traffic laws are firmly within the purview of state law, aimed at maintaining local regulatory standards. Therefore, disputes between states stand out as the circumstances that justify federal court involvement.