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ABI Quick Poll Respondents Divided over Whether the Supreme Court Got it Right in Stern v. Marshall on Counterclaims

Contact: John Hartgen
             703-894-5935
             jhartgen@abiworld.org

ABI QUICK POLL RESPONDENTS DIVIDED OVER WHETHER THE SUPREME COURT GOT IT RIGHT IN STERN V. MARSHALL ON COUNTERCLAIMS

August 4, 2011, Alexandria, Va.— Respondents in ABI’s latest Quick Poll were evenly divided over whether the Supreme Court got it right in Stern v. Marshall by holding that bankruptcy courts lack constitutional authority to issue final decisions on counterclaims grounded in state law. Forty-six percent agreed (30 percent “strongly agreed” and 16 percent “somewhat agreed”) and 46 percent disagreed (38 percent “strongly disagreed” and 8 percent “somewhat disagreed”) that the Supreme Court was correct in ruling in Stern v. Marshall that bankruptcy courts lack constitutional authority to issue final decisions on counterclaims grounded in state law. Five percent did not know or had no opinion on the question.
 
The Supreme Court on June 23 ruled 5-4 against the estate of actress Anna Nicole Smith, saying that a bankruptcy judge's decision giving millions to Smith (then known as Vickie Lynn Marshall) from the estate of oil tycoon J. Howard Marshall was decided incorrectly because those judges do not have the constitutional right to reach outside of bankruptcy cases into a probate case. In an opinion written by Chief Justice John Roberts, the Supreme Court decided that Congress did not have the authority under the Constitution to give bankruptcy judges the power to decide legal claims that are based entirely on state law and that have nothing to do with federal law. The Court explained that federal bankruptcy judges do not have life tenure or the same authority that regular federal judges enjoy, and Congress went too far in giving bankruptcy courts extra jurisdiction.
 
ABI’s Quick Poll is posted on ABI’s home page, www.abiworld.org. ABI members and the public are invited to respond to a question on a timely bankruptcy or insolvency issue. Visit http://www.abiworld.net/quickpoll/ to access the results of previous ABI Quick Polls.  

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ABI is the largest multi-disciplinary, nonpartisan organization dedicated to research and education on matters related to insolvency. ABI was founded in 1982 to provide Congress and the public with unbiased analysis of bankruptcy issues. The ABI membership includes over 13,000 attorneys, accountants, bankers, judges, professors, lenders, turnaround specialists and other bankruptcy professionals, providing a forum for the exchange of ideas and information. For additional information on ABI, visit www.abiworld.org. For additional conference information, visit http://www.abiworld.org/conferences.html.