Jenner & Block

Firm's Amicus Brief Urges Court to Confirm Bankruptcy Judges’ Broad Powers

Jenner & Block Partners Catherine L. Steege, Melissa M. Hinds and Barry Levenstam wrote an amicus brief on behalf of the American Bar Association urging the U.S. Supreme Court to give bankruptcy judges the final say in their courtrooms if the litigants consent. At issue is Executive Benefits Ins. Agency v. Peter H. Arkison, Trustee, No. 12-1200, in which the Court will be asked to decide whether Article III of the Constitution permits a bankruptcy court to hear and determine matters outside of the bankruptcy court’s constitutional authority upon a litigant’s consent.  The Court’s 2011 ruling in Stern v Marshall called this power into question.  Among other arguments, the authors contend that limiting bankruptcy judges’ authority would have “stark” consequences on district courts’ workloads.  The brief analyzes bankruptcy dockets in 11 sample districts across the country over a four-year period and concludes that if the Court eliminates the ability of litigants to consent to bankruptcy court adjudications, district court case loads would increase by as much as 213 percent.  The authors also note that eliminating the right of litigants to consent to non-Article III adjudications will call into question the constitutionality of the Federal Magistrates Act.  The authors write that  “[e]xtending Stern to eliminate express and implied consent would defeat th[e] Congressional [goal of efficient bankruptcy adjudications] and would lead to more, not less, litigation and to further delay and expense for the parties and the federal court system.”  News of the amicus brief was reported in The Wall Street Journal.