In re: Shayna H. Zarnel, No. 07-0090 (2d Cir. 2010)

Annotate this Case

Download PDF

07-0090-bk In re: Shayna H. Zarnel 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT August Term 2008 Argued: October 14, 2008 Decided: August 26, 2010 Docket Nos. 07-0090-bk(L); 07-0091-bk(Con); 07-0092-bk(Con); 07-0097-bk(Con); 07-0098-bk(Con); 07-0099-bk(Con) _____________________________________ In re: Shayna H. Zarnel, Diana M. Finlay, Lena M. Elmendorf DIANA G. ADAMS, United States Trustee Petitioner-Appellant, -v.SHAYNA H. ZARNEL, DIANA M. FINLAY, LENA M. ELMENDORF, Respondents-Appellees. _____________________________________ Before: LEVAL, KATZMANN, and LIVINGSTON, Circuit Judges. On appeal from the November 8, 2006 final judgment of the United States District Court for 31 the Southern District of New York (Brieant, J.), petitioner-appellant Diana G. Adams, United States 32 Trustee, argues that she has standing to appeal bankruptcy court orders striking the bankruptcy 33 petitions of respondents-appellees and that, under the strictures of the Bankruptcy Code, the 34 bankruptcy court was compelled to dismiss the cases of these debtors upon finding that they were 35 ineligible for bankruptcy due to their failure to comply with credit counseling requirements. We 36 conclude that the Trustee has standing to bring the appeal; that the appeal is not moot; and that the 37 filing of a bankruptcy petition by a debtor who has failed to satisfy credit counseling requirements 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 commences a bankruptcy case and invokes the automatic stay. VACATED and REMANDED. STEPHANIE R. MARCUS, U.S. Department of Justice, Civil Division, Appellate Staff (Peter D. Keisler, Assistant Attorney General, Michael J. Garcia, United States Attorney, Danna Drori, Assistant U.S. Attorney, Roberta A. DeAngelis, Acting General Counsel, P. Matthew Sutko, Lisa A. Tracy, Sean E. Martin, Office of the General Counsel, of counsel, William Kanter, U.S. Department of Justice, Civil Division, Appellate Staff, on the brief), for Petitioner-Appellant. SANFORD I. WEISBURST (William B. Adams, on the brief), Quinn Emanuel Urquhart & Sullivan, LLP, New York, NY, Court-Appointed Amicus Curiae on Behalf of Pro Se Debtors. LIVINGSTON, Circuit Judge: 18 This case requires us to interpret the interplay of provisions of the Bankruptcy Code that 19 arises when an individual or entity files a petition for bankruptcy without complying with the credit 20 counseling requirements created by the Bankruptcy Abuse Prevention and Consumer Protection Act 21 of 2005 ( BAPCPA ), Pub. L. No. 109-8, 119 Stat. 23. In the course of our analysis, we interpret 22 the credit counseling requirement, 11 U.S.C. § 109(h), the provisions that govern the commencement 23 of bankruptcy cases, 11 U.S.C. §§ 301, 302, and 303, and the statutory section governing automatic 24 stays, 11 U.S.C. § 362. 25 Petitioner-appellant Diana G. Adams, United States Trustee ( Trustee ), appeals from a final 26 judgment entered November 8, 2006 in the United States District Court for the Southern District of 27 New York (Brieant, J.) dismissing her appeal for lack of standing and in the alternative affirming 28 the bankruptcy court s decision to strike the bankruptcy petitions filed by respondents-appellees 2 1 ( debtors ) rather than to dismiss their cases. We determine that the Trustee has standing to bring 2 this appeal; that the appeal is not moot; and that the filing of a bankruptcy petition by a debtor who 3 has failed to satisfy credit counseling requirements commences a bankruptcy case and invokes the 4 automatic stay. We do not, however, pronounce on the question of what action a bankruptcy court 5 may take with respect to such a petition given these determinations. 6 7 BACKGROUND 8 The appeal before this Court is of a consolidated matter, generated by three unrelated filings 9 of bankruptcy in the United States Bankruptcy Court for the Southern District of New York. As the 10 facts are not in dispute, we take them largely from the bankruptcy court s opinion. See In re 11 Elmendorf, 345 B.R. 486 (Bankr. S.D.N.Y. 2006). 12 Lena Elmendorf, represented by counsel, filed a voluntary Chapter 7 petition on November 13 29, 2005. Although this proceeding was her first bankruptcy filing and her petition was 14 accompanied by the correct schedules, she neither filed a credit-counseling certificate, see 11 U.S.C. 15 § 521(b), nor sought an extension of time to do so, see id. § 109(h)(3)(A). The United States 16 Trustee s Office ( Trustee ) moved to dismiss the case on February 1, 2006. In re Elmendorf, 345 17 B.R. at 491. 18 Diana Finlay filed a Chapter 13 petition on April 3, 2006, as a pro se debtor, attaching none 19 of the requisite schedules. She sought an extension of time to file her credit-counseling certificate, 20 which the bankruptcy court denied for failure to state that the debtor sought counseling within five 21 days of filing. Id. at 492. Finlay had recently filed two prior Chapter 13 petitions: one on August 3 1 31, 2005, and one on November 28, 2005. Both were dismissed for failure to file the appropriate 2 bankruptcy schedules. Id. The Trustee filed a motion to dismiss the case on May 3, 2006. 3 Shayna Zarnel, the third relevant debtor, filed a Chapter 13 petition on March 13, 2006. 4 Although this was Zarnel s first bankruptcy filing, her husband had filed five bankruptcy petitions 5 with the court since January 2004. Id. She sought an extension of time to file her credit counseling 6 certificate but failed to allege exigent circumstances meriting a waiver; the bankruptcy court 7 therefore denied the extension. Id. at 493. On April 3, 2006, nonetheless, Zarnel filed a credit 8 counseling certificate attesting that she had received counseling on March 21, 2006. The Trustee 9 then moved to dismiss the case. 10 After holding a hearing on the motions in the Elmendorf and Zarnel proceedings, and 11 reserving decision on the motions in all three cases, the bankruptcy court determined in a July 18, 12 2006 opinion to strike the case of each debtor rather than to dismiss each case as requested by the 13 Trustee. Id. at 504-05. It arrived at this decision by examining the credit-counseling requirement 14 codified at 11 U.S.C. § 109(h). The court observed that the provision, which it said was intended 15 to provide debtors with education as to all of their options when experiencing financial difficulty, 16 before a resort to bankruptcy protection was necessary, had as a policy matter not proven to be 17 of assistance to debtors in seeking relief outside of the bankruptcy context. Id. at 490. The court 18 nonetheless concluded that compliance with § 109(h) s requirement that a debtor seek credit 19 counseling before obtaining bankruptcy relief was an absolute pre-requisite to individual 20 bankruptcy eligibility. 21 circumstances obtain an extension of time to receive counseling under § 109(h)(3)(A). The court Id. at 495. The court acknowledged that debtors may in certain 4 1 noted, however, that the difficulties of satisfying each of the statutory factors necessary to have a 2 request for extension granted are substantial, particularly for a pro se debtor.1 Id. at 496. 3 Relying on its reasoning in a previous case, In re Rios, 336 B.R. 177 (Bankr. S.D.N.Y. 4 2005), the bankruptcy court found that the statutory language of § 109(h), which provides that an 5 individual may not be a debtor without prior credit counseling, bars such filers from commencing 6 a case under 11 U.S.C. § 301. In re Elmendorf, 345 B.R. at 497. Moreover, if a case is not 7 commenced, the court determined, the automatic stay against creditor actions provided for in 11 8 U.S.C. § 362 does not operate to protect the ineligible filer. Id. at 497-98. Nonetheless, it found that 9 it still had jurisdiction over the matter even if a case was not properly commenced by the filing. Id. 10 at 499. Therefore, under the equitable powers granted by 11 U.S.C. § 105(a), the bankruptcy court 11 determined that because Congress had not explicitly directed the action a court should take in 12 response to a bankruptcy petition failing to commence a case, it had the power to strike the petitions 13 before it rather than to dismiss the cases, as urged by the Trustee.2 Id. at 503. The court noted that 1 The court noted that before an extension of time to receive credit counseling may be granted, a debtor must submit to the court (1) a certification (2) describing exigent circumstances that (3) merit a waiver of the requirement, (4) states that the debtor requested credit counseling from an approved nonprofit budget and credit counseling agency, but was unable to obtain services during the five day period beginning on the date that debtor made the request and (5) which is satisfactory to the Court. Id. at 496 (footnotes omitted). 2 11 U.S.C. § 105(a) provides as follows: The court may issue any order, process, or judgment that is necessary or appropriate to carry out the provisions of this title. No provision of this title providing for the raising of an issue by a party in interest shall be construed to preclude the court from, sua sponte, taking any action or making any determination necessary or appropriate to enforce or implement court orders or rules, or to prevent an abuse of process. 5 1 in its view dismissal, which has the potential effect of limiting access to or the duration of § 362 s 2 automatic stay in a subsequent filing, is for the most part an inappropriate remedy for a debtor s 3 innocuous failure to obtain counseling, prior to filing a bankruptcy petition, id. at 491, and it 4 concluded that it could always strike a case with prejudice to future filings if it found such a measure 5 to be warranted by a filer s bad faith or other such circumstances, id. at 504. 6 Because Elmendorf had not filed any previous bankruptcy petitions nor were there other 7 indications of bad faith, the court ordered her case stricken without prejudice. Id. In the case of 8 Finlay, the bankruptcy court noted that the debtor had filed three back-to-back bankruptcy 9 petitions, and that she sought, and obtained, an extension of time to file her credit counseling 10 certificate in her prior case, and was thus not ignorant of the requirement. Id. Noting that [t]he 11 circumstances in Ms. Finlay s filings are indicative of a pattern of delay and an abuse of the 12 provisions of Section 362, relating to the automatic stay, the court suggested that it might have been 13 inclined to grant some sort of preclusive relief, but because the Trustee had not requested any 14 relief other than dismissal, the court merely struck the case without prejudice. Id. at 504-05. 15 Finally, it also struck Zarnel s case without prejudice on the ground that, although her husband had 16 repeatedly filed for bankruptcy, this was Zarnel s first filing. Id. at 505. Acting on its own volition, 17 the bankruptcy court then certified its orders for direct appeal to this Court under 28 U.S.C. § 18 158(d)(2). On November 17, 2006, we consolidated and dismissed those appeals because no party 19 had filed a petition for permission to appeal under Federal Rule of Appellate Procedure 5(a). 20 The Trustee appealed the bankruptcy court s decision in each instance to the district court 6 1 on the issue of whether the bankruptcy court had erred in ruling that the petitions of ineligible 2 debtors had not commenced cases and that the petitions could thus be struck rather than dismissed. 3 Adams v. Finlay, No. 06 civ. 6039, 2006 WL 3240522 (S.D.N.Y. Nov. 3, 2006). In its opinion of 4 November 3, 2006, the district court sua sponte raised the issue of the Trustee s standing to appeal 5 the denials of its motions to dismiss. Applying the bankruptcy standing test of this Court that 6 requires an appellant to be a person aggrieved, meaning a person directly and adversely affected 7 pecuniarily by the challenged order of the bankruptcy court, Int l Trade Admin. v. Rensselaer 8 Polytechnic Inst., 936 F.2d 744, 747 (2d Cir. 1991) (quoting In re Cosmopolitan Aviation Corp., 763 9 F.2d 507, 513 (2d Cir. 1985)), the district court found that the Trustee was not aggrieved because 10 no creditor s rights were affected by these decisions and no substantive actions had been taken 11 between the filing and the striking of the cases. Therefore, it held, the Trustee lacked standing to 12 appeal. It nonetheless proceeded to decide the merits in the alternative after confessing that it had 13 no great confidence in its standing determination. Finlay, 2006 WL 3240522, at *4. 14 The district court concluded that the bankruptcy court s interpretation of the interplay 15 between §§ 109(h), 301, and 362(a) was the correct one that a case is not commenced nor does the 16 automatic stay come into existence when a bankruptcy petition is filed by an individual who fails 17 to fulfill the credit-counseling requirement. It then expounded on the court s equitable powers, 18 noting that motions to strike pleadings, although fallen from favor, were once common in the federal 19 courts and have not since that time been prohibited. Furthermore, it added, Federal Rule of Civil 20 Procedure 12(f) permits a court to strike a pleading, as do Bankruptcy Rules 7012(b) and 9011. 21 Given the latitude provided the bankruptcy court under § 105(a), the district court found it was not 7 1 beyond the bankruptcy court s judicial powers to strike the petition of a debtor who has not satisfied 2 the credit counseling requirement and thus has not commenced a case. Therefore, in the alternative 3 to dismissing the appeals for want of standing, it affirmed the bankruptcy court s orders in all 4 respects. 5 The Trustee timely appealed the district court s decision to this Court. In order to assist in 6 the development of arguments on appeal, this Court appointed Sanford I. Weisburst, Esq. amicus 7 curiae on behalf of the pro se debtors ( Amicus ). The debtors have not appeared in this appeal. 8 9 DISCUSSION 10 Before reaching the merits of this appeal, we must first determine whether we have 11 jurisdiction. Issues arise both from the Trustee s standing to take this appeal and its potential 12 mootness. We review these legal issues de novo. N.Y. Civil Liberties Union v. Grandeau, 528 F.3d 13 122, 128 (2d Cir. 2008); Cent. States Se. & Sw. Areas Health & Welfare Fund v. Merck-Medco 14 Managed Care, L.L.C., 433 F.3d 181, 197 (2d Cir. 2005). 15 16 I. Standing 17 Section 307 of the Bankruptcy Act authorizes the Trustee to raise and [ ] appear and be 18 heard on any issue in any case or proceeding under this title. 11 U.S.C. § 307. Despite that broad 19 authorization, cf. In re Columbia Gas Sys., 33 F.3d 294, 296 (3d Cir. 1994) ( [i]t is difficult to 20 conceive of a statute that more clearly signifies Congress s intent to confer standing ), the district 21 court concluded that the Trustee did not have standing to appeal the denial of its motions to dismiss. 8 1 We disagree with that determination. 2 As the district court correctly noted, in determining whether a party has standing to appeal 3 from a particular ruling of a bankruptcy court, we have frequently looked to whether an appellant 4 is a person aggrieved that is, a person directly and adversely affected pecuniarily by the 5 challenged order of the bankruptcy court. Int l Trade Admin., 936 F.2d at 747 (quoting In re 6 Cosmopolitan Aviation Corp., 763 F.2d at 513); see also 11 U.S.C. § 67(c) (1976) (repealed 1978) 7 (permitting appeal by a person aggreived by an order of a referee ). Applying that standard, the 8 district court determined that the Trustee had no direct pecuniary interest in the outcome of this 9 litigation and accordingly lacked standing. We disagree. 10 While the pecuniary interest formulation is an often used and often useful test of standing 11 in the bankruptcy context, it is not the only test. In re Revco D.S., Inc., 898 F.2d 498, 499 (6th 12 Cir. 1990). Instead, even absent a direct pecuniary interest in the litigation, a public interest may 13 also give a sufficient stake in the outcome of a bankruptcy case to confer appellate standing. Id. 14 (emphasis in original); see also In re Clark, 927 F.2d 793, 796 (4th Cir. 1991) ( [S]tanding to appeal 15 under the Bankruptcy Act as a party aggrieved may arise from a party s official duty to enforce 16 the bankruptcy law in the public interest ). The Supreme Court has thus determined, for instance, 17 that the Securities and Exchange Commission s interest in the maintenance of its statutory authority 18 and the performance of its public duties was sufficient to give the Commission standing to pursue 19 a bankruptcy appeal. SEC v. U.S. Realty & Improvement Co., 310 U.S. 434, 459-60 (1940). 20 Applying U.S. Realty and the public interest standard, several of our sister circuits have 21 concluded that the U.S. Trustee has just such an interest and thus standing to pursue bankruptcy 9 1 appeals. As the Sixth Circuit explained in reasoning adopted by the First and Third Circuits, the 2 U.S. trustees are responsible for protecting the public interest and ensuring that bankruptcy cases 3 are conducted according to law. That is the interest the U.S. trustee has pursued in this case, and 4 that interest gives him standing to appeal. In re Revco D.S., Inc., 898 F.2d at 499 (internal citation 5 omitted); see also In re United Artists Theatre Co., 315 F.3d 217, 225 (3d Cir. 2003) ( U.S. Trustees 6 are officers of the Department of Justice who protect the public interest by aiding bankruptcy judges 7 in monitoring certain aspects of bankruptcy proceedings. ); In re Plaza de Diego Shopping Center, 8 Inc., 911 F.2d 820, 824 (1st Cir 1990) (standing derives from the U.S. Trustee s interest from his 9 statutory responsibility to represent and protect the public ). The Fourth Circuit similarly 10 concluded, in reliance on U.S. Realty, that the U.S. Trustee had standing in the matter before that 11 court because the trustee [was] attempting, as was the SEC in United States Realty, to enforce the 12 law in the public interest in this case the interest of the public in avoiding substantial abuse of the 13 bankruptcy process. In re Clark, 927 F.2d at 796. 14 We find the reasoning of those courts to be persuasive and conclude that the U.S. Trustee s 15 responsibility to represent and protect the public interest affords it a substantial interest in, and 16 therefore standing to proceed with, this appeal. 17 18 II. Mootness 19 Mootness is a doctrinal restriction stemming from the Article III requirement that federal 20 courts decide only live cases or controversies; a case is moot if the parties lack a legally cognizable 21 interest in the outcome of the case. Fox v. Bd. of Trustees of State Univ. of N.Y., 42 F.3d 135, 140 10 1 (2d Cir. 1994) (quoting County of L.A. v. Davis, 440 U.S. 625, 631 (1979)) (internal quotation marks 2 omitted). This occurs when interim relief or events have eradicated the effects of the defendant s 3 act or omission, and there is no reasonable expectation that the alleged violation will recur. Irish 4 Lesbian & Gay Org. v. Giuliani, 143 F.3d 638, 647 (2d Cir. 1998). A bankruptcy case may also be 5 mooted based on jurisdictional and equitable considerations related to difficulty in fashioning fair 6 and effective judicial relief. AmeriCredit Fin. Servs., Inc. v. Tompkins, 604 F.3d 753, 755 (2d Cir. 7 2010) (quoting In re Sasso, 409 B.R. 251, 254 (B.A.P. 1st Cir. 2009)) (internal quotation marks 8 omitted). 9 The debtors, by failing to appeal the bankruptcy court s order striking their cases, have 10 waived any argument that they have satisfied the credit counseling requirements of 11 U.S.C. 11 § 109(h) and should have been allowed to proceed with their bankruptcies. Therefore, neither party 12 has a legally cognizable interest in this appeal related to its effect on the proceedings that initiated 13 the case. However, the effects of the bankruptcy court s decision to strike the petitions rather than 14 dismissing the cases, the question on appeal, extend beyond the matter immediately at hand. Under 15 11 U.S.C. § 362(c)(3), the automatic stay protecting the debtor s assets, which comes into being 16 when a petition is filed, terminates after thirty days if a single or joint [bankruptcy] case of the 17 debtor was pending within the preceding 1-year period but was dismissed. Similarly, if the debtor 18 has had two bankruptcy cases pending within the preceding year that were dismissed, the automatic 19 stay does not go into effect upon a third filing.3 Id. § 362(c)(4). Because, under the plain language 3 With regard to both of these provisions, the debtor may seek relief from the bankruptcy court, which is authorized to institute or extend an automatic stay, as appropriate, if the debtor demonstrates that the filing of the later case was in good faith as to the creditors to be stayed. 11 11 1 of § 362(c)(3) and (c)(4), only the dismiss[al] of a prior bankruptcy case triggers these 2 provisions, the manner in which the bankruptcy court disposes of the matter appears likely to affect 3 whether the limitations on the automatic stay for subsequent proceedings take effect. Within a year 4 of the striking of their petitions, therefore, the debtors clearly had a legally cognizable interest in the 5 outcome of this appeal, as did the Trustee, whose duty to protect the public interest is affected by 6 debtors avoiding what it alleges are the appropriate legal consequences of their actions. 7 The bankruptcy court struck the petitions at issue here on July 28, 2006. More than a year 8 has passed since that decision. Both the Trustee and Amicus argue that the case is nonetheless not 9 moot, but provide different reasons. The Trustee suggests that the word pending in § 362(c)(3) 10 and (c)(4) encompasses the time during which the case is on appeal, and hence that the year period 11 given in the statute has not yet even begun. The debtors and the Trustee would therefore maintain 12 their legally cognizable interests in the outcome for the duration of the appeal. Amicus, however, 13 argues that pending covers only the period in which the case is pending in the bankruptcy court 14 and that the automatic stay repercussions for a debtor end a year after the case is dismissed, even 15 if that dismissal is appealed. It invokes the exception to mootness for cases capable of repetition, 16 yet evading review. Van Wie v. Pataki, 267 F.3d 109, 113 (2d Cir. 2001) (quoting Knaust v. City 17 of Kingston, 157 F.3d 86, 88 (2d Cir. 1998)) (internal quotation marks omitted). This exception 18 applies when (1) the challenged action [is] in its duration too short to be fully litigated prior to its 19 cessation or expiration, and (2) there [is] a reasonable expectation that the same complaining party 20 [will] be subjected to the same action again. Id. at 114 (alterations in original) (quoting Weinstein U.S.C. § 362(c)(3)(B), (c)(4)(B). 12 1 v. Bradford, 423 U.S. 147, 149 (1975)) (internal quotation marks omitted). 2 We conclude that we need not interpret § 362(c) at the present time. The parties present the 3 only two logical possibilities for the meaning of the word pending in this context, and we agree 4 with each party that under its interpretation of the statute the case is not moot. If a case is pending 5 for the purpose of § 362(c)(3) and (c)(4) during the period on appeal, then each party continues to 6 have a legally cognizable interest because the manner in which the bankruptcy court disposed of the 7 debtors cases is likely to affect any subsequent proceedings in which they may be involved for a 8 year after this appeal is concluded. If, on the other hand, the year period delineated in the statute 9 has already expired, then we conclude that the capable of repetition, yet evading review doctrine 10 applies. The first element is clearly fulfilled under this interpretation, because a year is too short to 11 pursue an appeal to its conclusion. The second element is also satisfied because the bankruptcy 12 court will apply its interpretation of the relevant statutory provisions in future cases. See Storer v. 13 Brown, 415 U.S. 724, 737 n.8 (1974) ( [T]his case is not moot, since the issues properly presented, 14 and their effects on independent candidacies, will persist as the California statutes are applied in 15 future elections. ) Thus, the bankruptcy court will persist in striking petitions rather than dismissing 16 cases, causing repeated injury to the Trustee s interest. This indicates that under Amicus s 17 interpretation of the statute, the appeal is not moot. Because we need only assure ourselves that we 18 are deciding a live case or controversy, and because Article III jurisdiction exists under both 19 interpretations of the statute, we pass on to the merits of the appeal before us. 20 21 III. Whether a Case is Commenced 13 1 The question before us arises primarily from the interplay of two statutory sections of the 2 Bankruptcy Code: 11 U.S.C. § 301 and 11 U.S.C. § 109(h). Section 301(a), part of the subchapter 3 entitled Commencement of a Case, reads as follows: A voluntary case under a chapter of this title 4 is commenced by the filing with the bankruptcy court of a petition under such chapter by an entity 5 that may be a debtor under such chapter. Section 109, titled Who may be a debtor, contains a 6 list of requirements that must be satisfied before an entity or individual, as the case may be, is 7 eligible for bankruptcy. As part of BAPCPA, Congress amended § 109 to add subsection (h). Pub. 8 L. No. 109-8, § 106, 119 Stat. 23, 37 (2005). Subsection (h) begins as follows: Subject to 9 paragraphs (2) and (3), and notwithstanding any other provision of this section, an individual may 10 not be a debtor under [the Bankruptcy Code] unless such individual has, during the 180-day period 11 preceding the date of filing of the petition by such individual, received [credit counseling]. 11 12 U.S.C. § 109(h)(1). The remaining paragraphs provide exceptions for debtors who reside in areas 13 where there is no such available credit counseling, for debtors who can certify that they have exigent 14 circumstances and have made appropriate efforts to obtain counseling, and for those incapacitated, 15 disabled, or on active military duty in a combat zone. Id. § 109(h)(2)-(4). 16 As the bankruptcy court s decision noted, these two provisions may be read to suggest that, 17 since an individual may not be a debtor unless he has received credit counseling congruent with 18 the requirements of § 109(h) and under § 301 he may not commence a case unless he may be a 19 debtor, a debtor who fails to obtain pre-petition credit counseling and yet files a bankruptcy petition 20 has not actually commenced a case. In re Elmendorf, 345 B.R. at 497. Informed by this conclusion, 21 the bankruptcy court reasoned further that striking the petition was the appropriate procedural 14 1 method to dispose of the filing, rather than dismiss[ing] the case as provided for in 11 U.S.C. § 2 707.4 Amicus argues for this interpretation on appeal; the Trustee contends instead that a case is 3 commenced when an ineligible individual files for bankruptcy, and that the case must be dismissed. 4 An additional twist arises from the automatic stay provision. Section 362(a) of the Code 5 states that a petition filed under section 301, 302, or 303 of [the Bankruptcy Code] . . . operates as 6 a stay. Section 362(c)(3)-(4), in turn, sets forth limitations on the automatic stay applicable to 7 subsequent cases by the same petitioner. Under § 362(c)(3), where a case of the debtor was 8 pending 9 within the preceding 1-year period but was dismissed, the automatic stay is limited to 30 days 10 unless the debtor is able by clear and convincing evidence to rebut a presumption that the later case 11 was not filed in good faith. Moreover, § 362(c)(4) states that if 2 or more . . . cases of the debtor 12 were pending within the previous year but were dismissed, . . . the stay . . . shall not go into effect 13 upon the filing of the later case, and the debtor may obtain a stay only if he is able to demonstrate 14 that the filing of the later case is in good faith. The bankruptcy court, interpreting the interplay 15 among §§ 109(h), 301, and 362(a), concluded that the automatic stay comes into existence only 16 when a case is filed in accordance with §§ 301, 302, or 303 of the [Code]. In re Elmendorf, 345 17 B.R. at 498. Under this reading, when a petition is filed but no case is commenced, the automatic 18 stay does not come into effect. Amicus urges us to reject this interpretation and instead find that the 19 filing of the petition, not the commencing of a case, is sufficient to institute the automatic stay. 4 Section 707 provides that a bankruptcy court may dismiss a case for cause after notice and a hearing. 11 U.S.C. § 707(a). 15 1 Of the bankruptcy and district courts to consider this statutory tangle so far, a majority have 2 sided with the Trustee and found that debtors such as the ones in the case at bar should have their 3 cases dismissed. See, e.g., In re Crawford, 420 B.R. 833, 838 & n.7 (Bankr. D.N.M. 2009) 4 (collecting cases); In re Jones, 352 B.R. 813, 821 (Bankr. S.D. Tex. 2006) (same); In re Seaman, 5 340 B.R. 698, 703, 706 n.3 (Bankr. E.D.N.Y. 2006). Of the minority of courts that recognize the 6 option of striking the petition of a debtor ineligible under § 109(h), some agree with the bankruptcy 7 court in this case that such a petition does not trigger the protections of the automatic stay under 8 § 362(a), In re Elmendorf, 345 B.R. at 498-502. See, e.g., In re Salazar, 339 B.R. 622, 632-33 9 (Bankr. S.D. Tex. 2006). Finally, some courts have ruled in line with Amicus s conclusion that the 10 petition s filing does trigger an automatic stay but does not commence a dismissible case when the 11 petitioner is ineligible under § 109(h). See In re Thompson, 344 B.R. 899, 905-08 (Bankr. S.D. Ind. 12 2006), vacated as moot by 249 F. App x 475 (7th Cir. 2007). 13 In constructing its argument, Amicus places emphasis on the language of § 301, which 14 provides that a voluntary case under a chapter of [the Bankruptcy Code] is commenced by the filing 15 with the bankruptcy court of a petition under such chapter by an entity that may be a debtor under 16 such chapter. 11 U.S.C. § 301(a) (emphasis added). Amicus suggests that the phrase may be a 17 debtor should be interpreted as barring a debtor ineligible for bankruptcy under § 109(h) from 18 commencing a case. The Trustee, citing authority rejecting this position, counters that the word 19 may as used in the § 301 of the Bankruptcy Code means might or is meant to express a 20 possibility. In re Tomco, 339 B.R. 145, 159 (Bankr. W.D. Pa. 2006). We conclude that § 301, 21 as well as §§ 302 and 303 ( Voluntary cases, Joint cases, and Involuntary cases, respectively), 16 1 define the prerequisites for relief under particular chapters of the Bankruptcy Code, rather than the 2 existence in a jurisdictional sense of a voluntary, joint, or involuntary case. We thus reject the 3 position of Amicus that a debtor ineligible for bankruptcy pursuant to § 109(h) does not commence 4 a case by filing a petition pursuant to § 301. 5 Each of the three parallel sections implicated here contains limiting language indicating that 6 it is referencing a particular type of case, whether voluntary, joint, or involuntary, that in turn is 7 treated in a separate chapter of the Bankruptcy Code. Sections 301, 302 and 303 thus each provide 8 that a case under a given chapter is commenced by the filing of a petition by a petitioner that may 9 be a debtor under such chapter. See 11 U.S.C. §§ 301-03 (emphasis added). This limiting 10 language in all three sections suggests that the sections are not concerned with determining the 11 existence of a case in the broader sense i.e., [a] civil or criminal proceeding, action, suit, or 12 controversy at law or in equity. BLACK S LAW DICTIONARY 243 (9th ed. 2009) (defining case ). 13 Rather, they clarify that, when a debtor commences a case, the debtor is not eligible for relief under 14 a particular chapter of the Bankruptcy Code unless it meets the requirements to be a debtor under 15 that chapter. Other provisions in the Code place similar emphasis on the existence of chapter- 16 specific requirements for debtors. See, e.g., 11 U.S.C. §§ 706(d), 1112(f), 1307(g) ( [A] case may 17 not be converted to a case under another chapter of this title unless the debtor may be a debtor under 18 such chapter. ); see also H.R. Rep. 95-595, at 380, 406, 428 (Sept. 8, 1977), 1978 U.S.C.C.A.N. 19 5963, 6336, 6362, 6384 (providing that the limitations on conversion are meant to reinforce § 109). 20 The reading of § 301 proposed by Amicus, moreover, is inconsistent with other provisions 21 of the Bankruptcy Code. While claiming that the interpretation of § 301 permitting dismissal 17 1 ignores the distinction between case and petition, Amicus itself ignores the Bankruptcy Code s 2 definition of petition: The term petition means petition filed under section 301, 302, 303, or 304 3 of this title, as the case may be, commencing a case under this title. 11 U.S.C. § 101(42) (emphasis 4 added). Thus, a petition filed under §§ 301, 302, or 303 both operates as a stay, id. § 362(a), and 5 commences a bankruptcy case, id. § 101(42). See, e.g., Michael Newman, Comment, BAPCPA s 6 New Section 109(h) Credit Counseling Requirement: Is It Having the Effect Congress Intended?, 7 2007 UTAH L. REV . 489, 511. And while Amicus s theory that the automatic stay may come into 8 effect upon the filing of a petition, even though a case is not commenced, is superficially plausible 9 pursuant to the language of § 362(a) (providing that a petition filed under section 301, 302, or 303 10 . . . operates as a stay ), this theory falls apart when one attempts to determine the date that such a 11 stay terminates. Under § 362(c)(2), most actions remain stayed under § 362(a) until the earliest of 12 (A) the time the case is closed; (B) the time the case is dismissed; or (C) if the case is a case under 13 chapter 7 of this title concerning an individual or a case under chapter 9, 11, 12, or 13 of this title, 14 the time a discharge is granted or denied. 11 U.S.C. § 362(c)(2) (emphasis added). We determine, 15 therefore, that although an individual may be ineligible to be a debtor under the Bankruptcy Code 16 for failure to satisfy the strictures of § 109(h), the language of § 301 does not bar that debtor from 17 commencing a case by filing a petition; it only bars the case from being maintained as a proper 18 voluntary case under the chapter specified in the petition. 19 Although our conclusion in this respect comes into conflict with the reasoning in this Court s 20 decision in In re BDC 56 LLC, 330 F.3d 111 (2d Cir. 2003), which held that the eligibility 21 requirements of § 303 were jurisdictional in nature, we conclude that as a result of recent Supreme 18 1 Court precedent, that case is no longer good law. Section 303 provides, in relevant part, as follows: 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 (a) An involuntary case may be commenced . . . only against a person, except a farmer . . . that may be a debtor under the chapter under which such case is commenced. (b) An involuntary case against a person is commenced by the filing with the bankruptcy court of a petition . . . by three or more entities, each of which is either a holder of a claim against such person that is not contingent as to liability or the subject of a bona fide dispute as to liability or amount . . . . (c) After the filing of a petition under this section but before the case is dismissed or relief is ordered, a creditor . . . may join in the petition with the same effect as if such joining creditor were a petitioning creditor under subsection (b) of this section. ... (h) If the petition is not timely controverted, the court shall order relief against the debtor in an involuntary case under the chapter under which the petition was filed. . . . ... (j) Only after notice to all creditors and a hearing may the court dismiss a petition filed under this section (1) on the motion of a petitioner; (2) on consent of all petitioners and the debtor; or (3) for want of prosecution. 11 U.S.C. § 303. As discussed above, under the interpretation we grant to the language may be a 25 debtor under the chapter under which such case is commenced, a case is commenced under § 303 26 even if the debtor is ineligible by virtue of, for example, being a farmer. Similarly, the ineligibility 27 of creditors under the restrictions in § 303(b) does not prevent the case from being commenced. 28 This reading is supported, moreover, by the provisions of § 303(c), (h), and (j). Under § 303(c), a 29 creditor may join in the petition after it is filed before the case is dismissed with the effect 30 being as if the creditor had been part of the initial filing. Were there no case in existence because 31 of an insufficiency of eligible creditors at the outset, it would be impossible for new creditors to join 32 it by joining the petition. Moreover, § 303(h) and (j) provide for the bankruptcy court to order relief 19 1 or dismiss a case based on whether debtors and creditors take given actions. Surely relief cannot 2 be so granted, or the matter not dismissed in the absence of a motion to do so, if a case did not exist 3 in the first place. 4 Subject matter jurisdiction under title 11 proceedings in the bankruptcy courts is provided 5 by 28 U.S.C. § 1334(a), which states that, with some given exceptions, the district courts shall have 6 original and exclusive jurisdiction of all cases under title 11. District courts may, under 28 U.S.C. 7 § 157(a), provide that any or all cases under title 11 . . . shall be referred to the bankruptcy judges 8 for the district. The most straightforward reading of these provisions is that if a case exists under 9 title 11, the district court (and the bankruptcy court, if so invoked by § 157(a)) has jurisdiction over 10 it. The contrapositive of this statement, then, is also true: if the court has no jurisdiction, then there 11 is no case under the Bankruptcy Code. In In re BDC 55 LLC, we stated: 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 At least one circuit . . . has held that the requirement that a petitioning creditor s claim not be subject to a bona fide dispute[, found in § 303(b),] is not jurisdictional, but is an element that must be established to sustain an involuntary proceeding. We believe the more sound view is that the requirement is subject matter jurisdictional, and now so hold. Whether an alleged debtor is properly before the bankruptcy court in an involuntary case is a threshold determination that should be made at the earliest possible stage of the proceedings. One of the requirements to bringing such a petition is that the petitioning creditors claims are free from bona fide dispute. Any creditor wishing to invoke the bankruptcy court s jurisdiction in an involuntary case should be required to demonstrate at the earliest practicable point that its petition satisfies this requirement. Otherwise, creditors could, on the basis of relatively untested claims, haul a solvent debtor with whom they have legitimate disputes into bankruptcy court and force it to defend an involuntary proceeding while the bankruptcy court leaves for a later merits determination whether the debtor is even properly before it. 20 1 2 330 F.3d at 118-19 (quoting In re Rubin, 769 F.2d 611, 615 (9th Cir. 1985)) (internal citations and 3 footnote omitted). This holding, then, necessarily indicates that if the requirements of § 303 are not 4 met, no case exists nor, presumably, was commenced under title 11. 5 This panel is bound by the decisions of prior panels until such time as they are overruled 6 either by an en banc panel of our Court or by the Supreme Court. United States v. Wilkerson, 361 7 F.3d 717, 732 (2d Cir. 2004). However, if there has been an intervening Supreme Court decision 8 that casts doubt on our controlling precedent, one panel of this Court may overrule a prior decision 9 of another panel. Gelman v. Ashcroft, 372 F.3d 495, 499 (2d Cir. 2004) (quoting Union of 10 Needletrades, Indus. & Textile Employees v. U. S. I.N.S., 336 F.3d 200, 210 (2d Cir. 2003)) (internal 11 quotation marks omitted). The intervening decision need not address the precise issue decided by 12 the panel for this exception to apply. Wojchowski v. Daines, 498 F.3d 99, 106 (2d Cir. 2007).5 13 Since our holding in In re BDC 56 LLC, the Supreme Court has clarified the distinction between 14 two sometimes confused or conflated concepts: federal-court subject-matter jurisdiction over a 15 controversy; and the essential ingredients of a federal claim for relief. Arbaugh v. Y&H Corp., 546 16 U.S. 500, 503 (2006). In a unanimous decision, the Court held that a clear statement by Congress 17 was required to construe a threshold limitation on the scope of a statute as jurisdictional. Id. at 515- 18 16. But when Congress does not rank a statutory limitation on coverage as jurisdictional, courts 19 should treat the restriction as nonjurisdictional in character. Id. at 516. Therefore, a limitation on 5 In addition, prior to filing this opinion has been circulated to all the judges of this Court. See Shipping Corp. of India Ltd. v. Jaldhi Overseas Pte Ltd., 585 F.3d 58, 67 & n.9 (2d Cir. 2009); United States v. Crosby, 397 F.3d 103, 105 n.1 (2d Cir. 2005). 21 1 Title VII claims based on whether the defendant-employer had a particular number of employees 2 was nonjurisdictional because the limitation does not speak in jurisdictional terms or refer in any 3 way to the jurisdiction of the district courts, the statute contains an express jurisdictional provision 4 in a different portion from the limitation, there was no evidence in the statutory text that Congress 5 intended the requirement to be sua sponte monitored by the courts, and consideration of the 6 limitation after a judgment on the merits would be unfair and wasteful. Id. at 514-16; see also In 7 re Trusted Net Media Holdings, LLC, 550 F.3d 1035, 1043 (11th Cir. 2008). This readily 8 administrable bright line, Arbaugh, 546 U.S. at 516, now guides our consideration of whether § 303 9 contains restrictions on the bankruptcy court s jurisdiction. 10 We find that, in light of Arbaugh, In re BDC 56 LLC can no longer be considered good law 11 on this point. As the Eleventh Circuit noted in evaluating the same question, § 303 contains no 12 explicit reference to its requirements being jurisdictional in nature and never uses the word 13 jurisdiction. In re Trusted Net Media Holdings, LLC, 550 F.3d at 1043.6 Nor does the text of the 14 statute suggest that the bankruptcy court should sua sponte raise the issue of whether the 15 requirements of § 303 are satisfied; in fact, § 303(h) provides the opposite, since the bankruptcy 16 court should order relief if the petition is not timely controverted. Moreover, the Bankruptcy Code 17 is governed by a separate jurisdictional provision, 28 U.S.C. § 1344, which contains other 18 restrictions and exclusions. In sum, the restrictions of § 303 fall decisively on the nonjurisdictional 6 The Fifth and Eighth Circuits held that the requirements of § 303(a) were not jurisdictional pre-Arbaugh; the Ninth Circuit similarly so held for § 303(b). See In re Marlar, 432 F.3d 813, 814-15 (8th Cir. 2005) (per curiam); In re McCloy, 296 F.3d 370, 375 (5th Cir. 2002); In re Rubin, 769 F.2d 611, 615 (9th Cir. 1985). 22 1 side of Arbaugh s bright line. 2 Similarly, we find that the restrictions of § 301 and § 109(h) are not jurisdictional, but rather 3 elements that must be established to sustain a voluntary bankruptcy proceeding. Restricting whether 4 an individual may be a debtor either under the Bankruptcy Code in general or under a given chapter 5 does not speak in jurisdictional terms or invoke the jurisdiction of the district court, delineated in 6 28 U.S.C. § 1344 as discussed above. Certainly, consideration of these limitations after other 7 decisions on the merits have taken place would be wasteful and unfair; because bankruptcy is a 8 swift-moving process involving multiple parties, creditors and other parties in interest have a 9 considerable interest in being able to rely on the existence of a case, the bankruptcy court s 10 jurisdiction, and the validity of actions taken in the case in order to facilitate asset-preserving 11 transactions. In re Ross, 338 B.R. 134, 140 (Bankr. N.D. Ga. 2006). This decision, moreover, is 12 in line with pre-BAPCPA decisions from our sister circuits and in this circuit finding that other 13 provisions of § 109 are not jurisdictional. See, e.g., Rudd v. Laughlin, 866 F.2d 1040, 1042 (8th Cir. 14 1989) ( Nor do we believe that 11 U.S.C. § 109 is meant to restrict the jurisdiction granted under 15 [28 U.S.C. §§ 1334, 157]. ); In re Phillips, 844 F.2d 230, 235 n.2 (5th Cir. 1988) (finding § 109(g) 16 nonjurisdictional); In re Flores, 291 B.R. 44, 52-53 (Bankr. S.D.N.Y. 2003) (same), superseded by 17 BAPCPA, Pub. L. No. 109-8, § 303(b), 119 Stat. at 78. 18 Some additional support for our conclusion that a case has been commenced when debtors 19 ineligible for relief under § 109(h) file a bankruptcy petition may be gleaned from cases interpreting 20 11 U.S.C. § 342(b), which provides that [b]efore the commencement of a case under this title by 21 an individual whose debts are primarily consumer debts, the clerk shall give to such individual 23 1 written notice containing . . . a brief description of bankruptcy proceedings, credit counseling 2 services, and legal consequences from fraudulent findings. If we were to interpret the language 3 regarding commencement of a case in this section as the bankruptcy court did the language of § 301 4 and § 109(h), the provision would suggest that a case is not commenced if the would-be debtor is 5 not given the statutorily required notice. Courts considering the question have not so held. See, e.g., 6 In re Guth, No. 02-02121, 2002 WL 31941460, at *4 (Bankr. D. Idaho Nov. 8, 2002); In re Bryant, 7 51 B.R. 729, 731-32 (Bankr. N.D. Miss. 1985). 8 9 IV. Whether the Automatic Stay is Triggered 10 Having determined that a case is commenced, we turn to the question whether the automatic 11 stay takes effect when a petition is filed by a debtor ineligible under § 109(h). We conclude that it 12 does. Section 362, which outlines the basic commencement, effect, and termination of the automatic 13 stay, provides significant indications to that effect. As an initial matter, the section contains 14 language suggesting that the stay accompanies a commenced case: 15 16 17 18 19 20 21 22 23 24 [A] petition filed under section 301, 302, or 303 of this title . . . operates as a stay . . . of (1) the commencement or continuation . . . [of an] action or proceeding against the debtor that was or could have been commenced before the commencement of the case under this title, or to recover a claim against the debtor that arose before the commencement of the case under this title; (2) the enforcement, against the debtor . . . , of a judgment obtained before the commencement of the case under this title. 11 U.S.C. § 362(a). Section 362(b) lists circumstances under which the filing of a petition does not 25 operate as a stay, but the debtor s ineligibility is not among them. Moreover, none of the 26 mechanisms outlined in the remainder of the statute for confirming the existence of a stay or for 24 1 granting relief from one address anything related to the ineligibility of a debtor. 2 In addition, the bankruptcy court s interpretation of § 362 renders a nullity BAPCPA s 3 enactment of § 362(b)(21)(A). Section 362(b)(21)(A) provides that certain actions against real 4 property are not stayed when the debtor is ineligible under section 109(g) to be a debtor in a case 5 under this title. 7 As In re Ross notes, if an action by a person ineligible under § 109(g) were void 6 ab initio and did not result in an automatic stay under existing law, such an amendment would not 7 have been necessary. 338 B.R. at 139; see also In re Racette, 343 B.R. 200, 203 (Bankr. E.D. Wis. 8 2006). As discussed above, no such exception is provided for debtors ineligible under § 109(h), 9 which leads us to the conclusion that the automatic stay commences in such cases. The bankruptcy 10 court purported to distinguish § 109(h) from § 109(g) by characterizing ineligibility under the latter 11 provision as a failure that may be cured or waived by the court, rendering it possible that the 12 automatic stay could go into effect notwithstanding such a failure and thus conceivable that a 13 provision specifying circumstances in which it should not would be necessary. See In re Elmendorf, 14 345 B.R. at 499-500. We agree with the Trustee that this is not a tenable distinction. The wording 15 of § 109(g) is no less mandatory that the wording of § 109(h). Moreover, even assuming that the 7 Section 109(g) provides as follows: Notwithstanding any other provision of this section, no individual or family farmer may be a debtor under this title who has been a debtor in a case pending under this title at any time in the preceding 180 days if (1) the case was dismissed by the court for willful failure of the debtor to abide by orders of the court, or to appear before the court in proper prosecution of the case; or (2) the debtor requested and obtained the voluntary dismissal of the case following the filing of a request for relief from the automatic stay provided by section 362 of this title. 25 1 legislative history cited by the bankruptcy court for its description of § 109(g) is properly 2 considered, it does not support the conclusion that the requirements of the subsection are curable. 3 4 Amicus and the Trustee both correctly observe that our decision in In re Casse, 198 F.3d 327 5 (2d Cir. 1999), does not undermine the conclusion that an ineligible debtor s petition gives rise to 6 an automatic stay. Under separate but analogous circumstances, Casse affirmed the bankruptcy 7 court s dismissal of a case nunc pro tunc to the date of filing and approved of annulling a stay per 8 § 362(d), id. at 332, 342, rulings that indicate Casse recognized the stay as having initially gone into 9 effect. See Ross, 338 B.R. at 137 n.4; In re Flores, 291 B.R. at 57-58; Robert Lefkowitz, Note, The 10 Filing of a Bankruptcy Petition in Violation of 11 U.S.C. § 109(g): Does It Invoke the Automatic 11 Stay?, 26 CARDOZO L. REV . 297, 309 (2004). 12 Finally, we note that having the automatic stay commence even when a debtor fails to satisfy 13 the credit-counseling requirements both fits into the overall purpose and framework of the stay and 14 ensures that eligible debtors receive protection from the bankruptcy system. The automatic stay 15 serves a number of purposes: providing debtors with a fresh start, protecting the assets of the estate, 16 and allowing the bankruptcy court to centralize disputes concerning the estate. MBNA Am. Bank, 17 N.A. v. Hill, 436 F.3d 104, 109 (2d Cir. 2006). Much of the value of the stay is in the clarity of its 18 implementation; once a debtor files for bankruptcy and the stay is in effect, creditors must cease 19 their individual attempts to gain repayment and operate only through the bankruptcy court. This 20 centralization ensures a fair distribution of assets if the debtor proceeds through bankruptcy. If it 21 were unclear whether the stay was in place immediately following a debtor s filing for bankruptcy, 26 1 creditors would likely continue their collection efforts in hopes that the bankruptcy court would 2 find no merit in the debtor s petition. Thus, rather than providing the debtor with automatic 3 breathing space, the Code would pressure the debtor to file correctly in the first instance or risk 4 losing the protections of Title 11 due to the actions of several unscrupulous creditors. Shaw v. 5 Ehrlich, 294 B.R. 260, 268 (Bankr. W.D. Va. 2003). Even a debtor who filed correctly might face 6 challenges outside the bankruptcy court from particularly aggressive creditors hoping that a filing 7 correct on its face had an underlying flaw that would redound to their advantage. Construing a 8 debtor s ineligibility pursuant to § 109(h) as creating an exception to the automatic stay provision, 9 therefore, is a tenuous proposition given the statutory framework provided by Congress. Our 10 interpretation, in contrast, we believe supports and furthers that framework. 11 12 V. Whether the Bankruptcy Court Must Dismiss the Cases 13 Having concluded that no case had commenced and no automatic stay had been triggered 14 in the cases of the three debtors here, the bankruptcy court chose as the appropriate method of 15 disposing of the matters to exercise its equitable powers under 11 U.S.C. § 105(a) and strike the 16 debtors petitions. See In re Elmendorf, 345 B.R. at 503-05. The Trustee urges us to determine that 17 the only proper method of disposing of the matter of a debtor ineligible under § 109(h) is dismissal. 18 At this time, we need not, and do not, determine what actions the bankruptcy court may have taken 19 on the petitions. Rather, we remand to the bankruptcy court for it to consider in the first instance 20 the ramifications of our determination in the circumstances presented here that cases have 21 commenced. The bankruptcy court s determination that its equitable powers included striking the 27 1 petitions was premised on the belief that there were no cases to dismiss. While we note that we are 2 unaware of any case similar to this one in which a court has determined that a case has commenced 3 and yet taken an action other than dismissal, the bankruptcy court did not address whether other 4 actions, including striking a petition, might be appropriate in these circumstances. We thus conclude 5 that this is a question for the bankruptcy court to address initially. See In re Morgan, 182 F.3d 775, 6 780 (11th Cir. 1999) ( Since the applicability and use of § 105(a) is a decision that is typically left 7 to the bankruptcy court, we leave the decision to the bankruptcy court in this case. ). 8 9 CONCLUSION 10 For all of the foregoing reasons, the judgment of the district court is VACATED and the case 11 is REMANDED to the district court with instructions to remand to the bankruptcy court for further 12 proceedings consistent with this opinion. We thank amicus counsel, Sanford I. Weisburst and 13 William B. Adams of Quinn Emanuel Urquhart & Sullivan, LLP, for their helpful brief and oral 14 argument. 28

Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.