|Event:||STERN v. MARSHALL: Texas Justice Triumphant|
|Location:||Cardozo Law School, Jacob Burns Moot Court Room|
Prof. William D. Araiza
Brooklyn Law School
Prof. David G. Carlson
Cardozo School of Law
Gary T. Holtzer
Partner, Weil, Gotshal and Manges LLP
On June 23, 2011, the United States Supreme Court, in Stern v. Marshall, 131 S. Ct. 2594, proclaimed 28 U.S.C. section 157(b)(2) unconstitutional in part. This section grants jurisdiction to the bankruptcy court over so-called “core proceedings.” More precisely, section 157(b)(2)(C) names as a core proceeding any counterclaim by the bankruptcy estate against persons filing claims against the estate. In Stern, the debtor (Anna Nicole Smith) had a counterclaim for intentional interference with a donative intent against her step-son. The Supreme Court ruled that the step-son had a constitutional right to have this claim heard by a life-time appointed Article III judge, not a bankruptcy judge appointed for a 14 year term.
This conference will examine the case that gave rise to this extraordinary hold and will examine what other parts of 28 U.S.C. section 157(b) might be unconstitutional in light of the Supreme Court’s reasoning. The panelists will also examine how counterclaims must now be administered and how, if at all, Stern v. Marshall will affect the way bankruptcy cases are administered.