Tag Archives: Bankruptcy

Supreme Court Preview — October Term 2023 — Part 2

Last week, we took a look at the cases that are set for argument in October and November.  This week, we look at the cases that have been accepted for argument, but have not yet been set for an argument date.  These cases will probably be heard in December or January.

The primary job of the Supreme Court (reflected in the criteria that it lists on its rules for what applicants need to demonstrate before the Supreme Court will accept review) is to assure that courts uniformly interpret and apply federal law.  As such, every case is important to some groups of people.  But the focus in these posts are on those cases which could have a political impact.

First on this list is Muldrow.  This case involves Title VII — the law barring discrimination based on race and gender in employment.  The issue in this case is “transfers.”  Basically, by transfer, we are talking about the reassignment of employees from one job to another job.  Generally, Title VII only applies to “adverse” actions.  As such, the issue is what type of damage/impact does the employee have to show.  At least the argument from the employer is that if the transfer is truly a lateral move with no impact on pay or promotion opportunity, then there is no discrimination.   Obviously, there are other things that impact what qualifies as a desirable job.  Here, the employer is a police department and the transfer is from a detective-type squad to a patrol squad.  Technically, the ranks are equal, but there are reasons why a detective squad is a preferred position.   Needless to say, this case could either indicate an approach to Title VII that would allow it to broadly apply to transfer decisions or an approach in which transfers to nominally equivalent positions will rarely implicate Title VII.  From a practical standpoint, there seems something wrong with an interpretation that would, for example, let an employer assign most women to a night shift and most men to a day shift on the theory that the positions are equivalent, but I would not put such a myopic view past some of the current justices. Continue Reading...

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A Partial Victory for Native Americans

The history of the United States is full of broken promises to Native American.  For a rather long period of time (in a pattern repeated in other places like Canada and Australia), part of the attempt of the European settlers to eliminate Native Americans was a practice of, for all intents and purposes, kidnapping children and placing them either in boarding schools or adopting them out to White parents to be raised without any knowledge of their ancestral culture.

During the Civil Rights era, several steps were taken to remedy these past sins.  In part, the federal government strengthened the powers of tribal governments.  Congress also passed the Indian Child Welfare Act to prevent a repeat of the efforts of some groups to break the tribes by stealing their youngest members.  Of course, in the U.S. no law stays the same forever, and interest groups always try to push back against the laws that are on the books.  Ultimately, these disputes end up at the Supreme Court, and recent terms have seen an ever growing number of cases related to Native Americans.  This term was no different, and this week saw the U.S. Supreme Court decide two cases related to Native Americans.

The “minor” case — Lac du Flambeau Band of Lake Suprerior Chipewa Indians vs. Coughlin — involved the intersection between tribal government and bankruptcy law.  Like other governments, sometimes an individual who owes money to a tribal government will enter bankruptcy.  If a person owes money to a private business, that business is only allowed to take further steps to collect its debt through the bankruptcy court.  In this case, the debtor tried to have the bankruptcy court enforce the stay against the tribe.  Normally, governments (including the tribes) have immunity from being sued, but the bankruptcy code contains some exceptions.  By a 7-1-1 vote, the Supreme Court found that tribal governments are inclcuded in the limited waiver of immunity contained in the bankruptcy code.  The two who did not join the majority opinion were Justice Thomas and Justice Gorsuch for very different reasons.  Justice Thomas agreed with the majority that the tribe lacked immunity from being sued because the tribe was engaged in “commerical” rather than “governmental” activity and, therefore, would not have had immunity even without the provision in the bankruptcy code waiving that immunity.  Justice Gorsuch, however, would have found no waiver of immunity.  In this case Justice Gorsuch continued his pattern of being one of the foremost defenders of the tribes on the Supreme Court.  While this case was a “loss” for the tribes, it was a loss because the Supreme Court treated tribal governments as being equal to other governments. Continue Reading...

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The Supreme Court and Puerto Rico — Part Two

As noted in Part One, the Supreme Court had two cases involving Puerto Rico this term.  The first, decided, last Thursday was the more philosophical of the two cases — focusing on Puerto Rico’s status under the Constitution.  The ink was barely dry on that opinion when the Supreme Court issued the second opinion — dealing with the more immediately practical question of how bankruptcy law applies to Puerto Rico’s debt.

As a general matter, the Constitution gives Congress the power to enact a “uniform” law governing bankruptcy — a process that allows private individuals, businesses, and even government to restructure (and in some cases partially reduce) their debts.  As the fact that it is one of the enumerated powers in the original text of the Constitution shows, bankruptcy is not a new concept and predates the United States.  The Bankruptcy Code (Title 11 of the United States Code) is divided into chapters with different chapters applying to different entities and the circumstances of that entity — one for businesses that just want to wind up their affairs, one for businesses that want to try to continue, one for private individuals, and one (which applies here) governing the debts of municipalities (Chapter 9).

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