LexisNexis® Legal Newsroom
The Ninth Circuit Holds that Bankruptcy Courts Have Authority to Recharacterize Debt as Equity

On April 30, 2013, the United States Court of Appeals for the Ninth Circuit held that the bankruptcy court has authority to recharacterize as equity, rather than debt, advances of funds made purportedly as a loan to the recipient prior to its bankruptcy. In re Fitness Holdings International, Inc...

Supreme Court Dodges Consent Issue in Bellingham But Signals No New Challenges to Bankruptcy Court Authority

In the follow-up to Stern v. Marshall , the Supreme Court concluded that it didn’t need to answer the primary questions addressed to it, leaving open (on the surface at least) the issue of whether parties can consent to final adjudication by a bankruptcy court in situations where the court could...

Supreme Court Decides Not to Destroy the Current Bankruptcy Court System

by Ben Feder The U.S. Supreme Court on June 9, in Executive Benefits Insurance Agency v. Arkinson [ an enhanced version of this opinion is available to lexis.com subscribers ], limited somewhat the ramifications of its landmark opinion two years ago in Stern v. Marshall [ enhanced version ]. The Court...

Supreme Court Prepares for Stern v. Marshall Round 3

When the Supreme Court struck down the Bankruptcy Reform Act's grant of authority to bankruptcy judges in 1982, it took it took them 29 years to return to the issue. This allowed bankruptcy law to develop and mature without constantly fretting about whether the whole system would collapse. However...

Still Trying to Close the Stern v. Marshall Can of Worms – The Supreme Court to Grapple Again With Thorny Questions of Bankruptcy Court Jurisdiction

by Ben Feder Three years ago, in Stern v. Marshall , a case that arose out of the endless litigation between Anna Nicole Smith and the son of her late husband, the Supreme Court stunned the commercial legal community by reopening what many had believed were long-settled questions regarding the...

Professor Kenneth N. Klee on the Supreme Court's Grant of Certiorari in Wellness

Excerpt: I. Introduction The Supreme Court granted certiorari in Wellness International Network, Ltd. v. Sharif , 727 F.3d 751 (7th Cir. 2013) [an enhanced version of this opinion is available to lexis.com subscribers] , cert. granted , 2014 U.S. LEXIS 4693 (July 1, 2014) (No. 13-935) (" Wellness...

Professor Kenneth N. Klee on the Supreme Court's Holding in Exec. Benefits Ins. Agency v. Arkison

Professor Kenneth Klee analyzes the Supreme Court holding in Executive Benefits Insurance Agency v. Arkison that while Article III of the Constitution prohibits a bankruptcy court from entering final judgment on a bankruptcy-related claim, the relevant statute nevertheless permits a bankruptcy court...

Fifth Circuit Provides Valuable Guidance on Bankruptcy Court Jurisdiction and Authority Post-Stern

Many cases deal with debtors who fraudulently convey away their assets before filing bankruptcy. But what about the situation where the debtor is the victim of a fraudulent conveyance rather than the perpetrator? In Galaz v. Galaz (In re Galaz) , No. 13-50781 (5th Cir. 8/25/14), which can be found here...

Supreme Court to Decide If Bankruptcy Lawyers Can Get Fees For Pursuing Bonus Fees

WASHINGTON, D.C. — (Mealey’s) The U.S. Supreme Court on Oct. 2 agreed to decide whether the U.S. Bankruptcy Code gives bankruptcy courts discretion to award lawyers their fees for successfully defending applications for enhanced attorney fees ( Baker Botts, LLP, et al. v. ASARCO, LLC , No...

Wellness International Oral Argument: Supreme Court Justices Grapple With Implications of Narrowing Bankruptcy Court Powers

by Ben Feder There were nearly a million bankruptcy cases filed by individuals and businesses in 2014. It is safe to say that only the tiniest fraction of such debtors have any familiarity with the Supreme Court’s decision in Stern v. Marshall nearly four years ago [ an enhanced version of this...

Wellness Case Brings Healing for Bankruptcy Court Authority

Resolving an issue left open by two prior decisions, the Supreme Court ruled that the right to entry of a final judgment by an Article III court, like the right to trial by jury, is a personal right which can be waived or consented away (subject to supervision by an Article III Court). The decision left...

U.S. Supreme Court Addresses Authority of Federal Bankruptcy Courts to Enter Final Orders and Judgments

The Wellness majority opinion is noteworthy for a number of reasons. As a practical matter, it permits this aspect of bankruptcy court practice—proceeding to final judgment in non-core matters on consent as being valid and constitutionally permissible—to continue. The world may end in...

Supreme Court Decides to Maintain the Viability of the U.S. Bankruptcy Courts, But a Key Question Remains Unresolved

by Ben Feder Four years ago, in Stern v. Marshall , the Supreme Court stunned many observers by re-visiting separation of powers issues regarding the jurisdiction of the United States bankruptcy courts that most legal scholars had viewed as long settled [ an enhanced version of this opinion is available...

Supreme Court Holds That Bankruptcy Courts Can Adjudicate Stern Claims

by Evan Zisholtz In a 6-3 ruling, the U.S. Supreme Court held that bankruptcy courts have the authority to adjudicate Stern claims so long as the litigant parties provide “knowing and voluntary consent.” This decision in Wellness International Network, et. al. v. Richard Sharif [lexis...