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- Title
INDIANS - SOVEREIGN IMMUNITY: THE U.S. SUPREME COURT'S INTERPRETATION OF THE BANKRUPTCY CODE.
- Authors
Weightman, Erin
- Abstract
In Lac du Flambeau Band of Lake Superior Chippewa Indians v. Coughlin, the U. S. Supreme Court addressed whether the Bankruptcy Code expressly abrogates sovereign immunity for federally recognized Indian tribes in bankruptcy proceedings. The Lac du Flambeau Band of Lake Superior Chippewa Indians is a federally recognized tribe and owns multiple businesses. Lend green, one of the businesses owned by the tribe5 loaned Brian Coughlin eleven hundred dollars. Mr. Coughlin filed for Chapter Thirteen bankruptcy before he could repay the loan. The automatic stay under the Bankruptcy Code prevented Lend green from collecting the money from Mr. Coughlin. However, Lend green continued trying to collect. Mr. Coughlin petitioned the bankruptcy court to enforce the automatic stay. The bankruptcy court determined that they did not have subject-matter jurisdiction. Creating a split in the court of appeals, the First Circuit disagreed with the bankruptcy court and held that federally recognized tribes should have sovereign immunity privileges in bankruptcy proceedings. The U.S. Supreme Court granted certiorari. Under 11 U.S.C. Section 101 (27) of the Bankruptcy Code, the Court held that federally recognized tribes are a "governmental unit" because they make their own laws and have the power to tax. Therefore, the Code's abrogation provision Section 106(a) also applies to federally recognized tribes. Justice Thomas wrote a concurring opinion, arguing instead that Lend green lacked sovereign immunity because the transaction occurred off the reservation. Justice Gorsuch dissented, noting that Congress has historically identified tribes by name when abrogating sovereign immunity. Additionally, Justice Gorsuch argued that tribes do not constitute domestic or foreign governments and, therefore, should be entitled to sovereign immunity in bankruptcy proceedings. Ultimately, Lac du Flambeau Band clarifies that federally recognized tribes are a "governmental unit" within the Bankruptcy Code. As such, their sovereign immunity is abrogated in bankruptcy proceedings.
- Subjects
GOVERNMENT liability; ACTIONS &; defenses (Law); UNITED States. Supreme Court; UNITED States. Bankruptcy; BANKRUPTCY courts
- Publication
North Dakota Law Review, 2024, Vol 99, Issue 1, p195
- ISSN
0029-2745
- Publication type
Article