In a decision that may have significant practical implications to the practice of bankruptcy law, the U.S. Supreme Court recently declared, on constitutional grounds, that a bankruptcy court cannot exercise jurisdiction over a debtor’s state law counterclaims, thus considerably limiting the ability of the bankruptcy court to fully and finally adjudicate claims in a bankruptcy case. Stern v. Marshall, No. 10-179 (June 23, 2011).

The Ninth Circuit has extended an additional level of protection for company publications that take the form of blogs. In reference to the level of fault required to prove liability for an allegedly defamatory posting, the court explained that it is irrelevant whether a blogger is a member of an institutional press corps or a private entity.

The Ninth Circuit last week became the first federal court of appeals to find that bloggers are entitled to the same First Amendment protections as traditional print and broadcast media when sued for defamation. Obsidian Fin. Grp. v. Cox, -- F.3d --, 2014 WL 185376 (9th Cir. Jan. 17, 2014).

Joe Francis built his Girls Gone Wild (GGW) empire (and the ego of an emperor) filming intoxicated college girls in various states of undress, putting that footage on VHS (and later DVDs and branded websites), and selling them to eager consumers across the globe.  If you were alive and watching TV in the late 1990s and early aughts, those late-night infomercials undoubtedly made their way across your TV screen at some point, or you may have even purchased such classics as Girls Gone Wild: Mardi Gras Madness or Girls Gone Wild: Ultimate Spring Break.

Last year, a U.S. bankruptcy court held that a bankruptcy trustee could settle a Financial ‎Industry Regulatory Authority (“FINRA”) suit against a broker-dealer by its former employee ‎seeking damages and expungement of alleged false and defamatory FINRA Form U-5 ‎termination disclosure language, over the objection of the former employee-debtor.2  Once a ‎bankruptcy case is filed by a former employee, the claims become property of the bankruptcy ‎estate.

In June 2011, the United States Supreme Court issued its opinion in the case known as Stern v. Marshall. The U.S. Supreme Court held that filing a proof of claim in a bankruptcy case does not constitute consent to the bankruptcy court’s jurisdiction over all counterclaims or actions that the bankruptcy estate may later bring against the creditor.

In fact, filing the proof of claim constitutes consent only to those claims or actions that either (1) stem from the bankruptcy case itself; or (2) are necessary to the resolution of the creditor’s proof of claim.  

On June 23, 2011, the Supreme Court of the United States issued the decision of Stern v. Marshall, debatably the most important case on bankruptcy court jurisdiction in the last 30 years. The 5-4 decision, written by Chief Justice Roberts, established limits on the power of bankruptcy courts to enter final judgments on certain state law created causes of action.

No. 08-6038 (8th Cir. BAP 11/16/09)

The United States Supreme Court recently ruled in Stern v. Marshall1 that a bankruptcy court lacks constitutional authority to render a final judgment on a bankruptcy estate’s counterclaim against a creditor based on state common law, despite an express statutory grant of jurisdiction. This ruling is the most significant decision regarding bankruptcy court jurisdiction since the Court’s 1982 decision in Northern Pipeline v. Marathon2 and it could significantly affect the administration of bankruptcy cases.

Root of the Constitutional Problem

During her lifetime, Vickie Lynn Marshall, publicly known as Anna Nicole Smith (“Vickie”), was hardly a stranger to the prying eyes of the media. Today, the late Vickie is again the subject of media coverage, this time in the context of a fifteen-year legal saga that has twice reached the United States Supreme Court.