BP RE, L.P. v. RML Waxahachie Dodge, L.L.C., et al., No. 12-51270 (5th Cir. 2013)Annotate this Case
BPRE filed for Chapter 11 bankruptcy relief and then filed an adversary complaint in the bankruptcy court alleging various state-law tort and contract claims against RML. The bankruptcy court entered a final judgment denying relief and the district court affirmed. In Stern v. Marshall, the Supreme Court determined that the bankruptcy court lacked the constitutional authority to enter final judgment on the debtor's state-law counterclaim even thought the statute conferred such authority. Although the strict holding in Stern limited bankruptcy-court authority in one isolated respect and the question presented was a narrow one, its sweeping reasoning was broad and logically must be applied to BPRE's claims here. Therefore, the court vacated the district court's judgment and remanded, concluding that the bankruptcy court lacked Article III standing to enter final judgment on BPRE's claims.
The court issued a subsequent related opinion or order on February 28, 2014.