Supreme Court Sets Defalcation Bar at Gross Recklessness under Section 523(a)(4)

In the only bankruptcy case pending before it this term, a unanimous Supreme Court has ruled that the archaic term "defalcation" used in 11 U.S.C. Sec. 523(a)(4) requires knowledge of, or gross recklessness in respect to, the improper nature of the relevant fiduciary behavior complained...

US Supreme Court Deciphers "Defalcation" in Bullock: A Canonical Exercise in "Reading Law" (Scalia/Garner)

The US Supreme Court has long taught the importance of certain canons of interpretation unique to bankruptcy law, the more significant ones being: The Fresh-Start Policy : A primary purpose of bankruptcy is to relieve the debtor "from the weight of oppressive indebtedness and permit...

US Supreme Court's Decision in Bullock: A Significant Development in Determining "Recklessness" Under Federal Law?

Last week I published a blog post on the US Supreme Court's unanimous decision in Bullock v. BankChampaign, N.A. , No. 11-1518 (May 13, 2013) ( pdf ) [ an enhanced version of this opinion is available to lexis.com subscribers ], that focused on the Court's application of the noscitur a sociis...

Professor Kenneth N. Klee on the Supreme Court's Holding in Bullock v. BankChampaign, N.A., 569 U.S. __, 2013 U.S. LEXIS 3521 (May 13, 2013)

Professor Kenneth Klee analyzes the May 13, 2013 Supreme Court ruling in Bullock v. BankChampaign, N.A. (In re Bullock) which settled a longstanding circuit split concerning the meaning of the word "defalcation" in the Bankruptcy Code exception to discharge in § 523(a)(4) by holding...