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Stern v. Marshall

Supreme Court of the United States

January 18, 2011, Argued; June 23, 2011, Decided

No. 10-179

Opinion

 [*468]  [**2600]  Chief Justice Roberts delivered the opinion of the Court.

This “suit has, in course of time, become so complicated, that . . . no two . . . lawyers can talk about it for five minutes, without coming to a total disagreement as to all the premises. Innumerable children have  [***485] been born into the cause:  [****14] innumerable young people have married into it;” and, sadly, the original parties “have died out of it.” A “long procession of [judges] has come in and gone out” during that time, and still the suit “drags its weary length before the Court.”

Those words were not written about this case, see C. Dickens, Bleak House, in 1 Works of Charles Dickens 4-5 (1891), but they could have been. This is the second time we have had occasion to weigh in on this long-running dispute between Vickie Lynn Marshall and E. Pierce Marshall over the fortune of J. Howard Marshall II, a man believed to have been one of the richest people in Texas. The Marshalls' litigation has worked its way through state and federal courts in Louisiana, Texas, and California, and two of those courts--a Texas state probate court and the Bankruptcy Court for the Central District of California--have reached contrary decisions on its merits. The Court of Appeals below held that the Texas state decision controlled, after concluding that the Bankruptcy Court lacked the authority to enter final judgment on a counterclaim that Vickie brought against  [*469]  Pierce in her bankruptcy proceeding.1 To determine whether the Court of Appeals  [****15] was correct in that regard, we must resolve two issues: (1) whether the Bankruptcy Court had the statutory authority under 28 U.S.C. § 157(b) to issue a final judgment on Vickie's counterclaim; and (2) if so, whether conferring that authority on the Bankruptcy Court is constitutional.

Although the history of this litigation is complicated, its resolution ultimately turns on very basic principles. Article III, § 1, of the Constitution commands that “[t]he judicial Power of the United States, shall be vested in one supreme Court, and in such inferior Courts as the Congress may from time to time ordain and establish.” That Article further provides that the judges of those courts shall hold their offices during good behavior, without diminution of salary. Ibid. Those requirements [**2601]  of Article III were not honored here. The Bankruptcy Court in this case exercised the judicial power of the United States by entering final judgment on a common law tort claim, even though the judges of such courts enjoy neither  [****16] tenure during good behavior nor salary protection. We conclude that, although the Bankruptcy Court had the statutory authority to enter judgment on Vickie's counterclaim, it lacked the constitutional authority to do so.

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564 U.S. 462 *; 131 S. Ct. 2594 **; 180 L. Ed. 2d 475 ***; 2011 U.S. LEXIS 4791 ****; 79 U.S.L.W. 4564; 65 Collier Bankr. Cas. 2d (MB) 827; Bankr. L. Rep. (CCH) P82,032; 55 Bankr. Ct. Dec. 1; 22 Fla. L. Weekly Fed. S 1232

HOWARD K. STERN, executor of the ESTATE OF VICKIE LYNN MARSHALL, Petitioner v. ELAINE T. MARSHALL, executrix of the ESTATE OF E. PIERCE MARSHALL

Subsequent History: US Supreme Court rehearing denied by Stern v. Marshall, 564 U.S. 1058, 132 S. Ct. 56, 180 L. Ed. 2d 924, 2011 U.S. LEXIS 5143 (U.S., 2011)

Related proceeding at Marshall v. Marshall (In re Marshall), 721 F.3d 1032, 2013 U.S. App. LEXIS 13398 (9th Cir. Cal., 2013)

Prior History:  [****1] ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT.

Marshall v. Stern (In re Marshall), 600 F.3d 1037, 2010 U.S. App. LEXIS 5692 (9th Cir. Cal., 2010)

Disposition: Affirmed.

CORE TERMS

bankruptcy court, counterclaim, district court, proceedings, cases, courts, final judgment, adjudicate, public right, bankruptcy judge, plurality opinion, matters, judicial power, bankruptcy proceedings, non-Article, delegation, file a claim, parties, marks, determinations, quotation, argues, court of appeals, proof of claim, common law, orders, customer, adjudicatory authority, defamation claim, tribunal

Constitutional Law, The Judiciary, Jurisdiction, General Overview, Bankruptcy Law, Procedural Matters, Core Proceedings, Noncore Proceedings, Federal District Courts, Judicial Review, Jurisdiction, Governments, Legislation, Interpretation, Civil Procedure, Subject Matter Jurisdiction, Congressional Limits, Bankruptcy, Estate Property, Contents of Estate