While the paparazzi followed every move of Anna Nicole
Smith during her tragically shortened life, those of us of the legal paparazzi
now stalk every new development in the case which bears her legal name, Stern
v. Marshall. Some commentators have asked whether the newly emphasized
limitations on the jurisdiction of U.S. Bankruptcy Judges to enter final
judgments will apply to U.S. Magistrates as well. The Fifth Circuit has
indicated that it will soon be considering this issue.
On September 9, 2011, the Fifth Circuit directed the parties to submit
letter briefs of not more than six pages addressing
whether the reasoning of Stern applies to magistrate judges, which, like
bankruptcy judges, are not Article III judges, and whether, under Stern,
a magistrate judge can enter final judgment in a case tried to a magistrate
judge by consent under 28 U.S.C. § 636(c) where jurisdiction is based on
diversity of citizenship and state law provides the rule of decision.
Technical Automation Services Corp. v.
Liberty Surplus Insurance Corporation, No. 10-20640 (5th Cir.
9/9/11), Order, p. 2.
Thus, it looks like there may be a circuit-level opinion on Stern v.
Marshall sooner rather than later.
Hat Tip to Prof. Ken Klee.
You can read the order in full below.
at A Texas Bankruptcy Lawyer's Blog
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This is what makes the practice of law great. The possibility of massive changes. Can you imagine if the same grounds to support Sterns v. Marshall is found to apply to magistrate judges? All this time, and every decision made by a magistrate judge was made without proper constitutional power. We will see. Thanks for the update on this exciting issue.
It seems to me it is not really bankruptcy court jurisdiction that is at issue. It seems more that the bankruptcy judge, himself, does not have the authority to enter the decision. The bankruptcy case is technically handled by the US District Court and referred to the bankruptcy court.