Porter v. Nabors Drilling USA, L.P., No. 15-16985 (9th Cir. 2017)
Annotate this CaseMovant-Appellee Nabors Drilling USA, L.P. filed for reorganization under Chapter 11 of the Bankruptcy Code. That filing triggered the automatic stay under 11 U.S.C. 362(a)(1), which generally applied to protect a debtor after it has filed for bankruptcy protection. The question presented in this case was whether that stay applied to a lawsuit filed by appellant-plaintiff Jeremy Porter, who has asserted a claim under California’s Private Attorney General Act of 2004 (“PAGA”). Porter contended the exception established in 11 U.S.C. 362(b)(4) applied to exempt his PAGA claim from the automatic stay. The Ninth Circuit concluded that the exception does not apply to a claim brought by a private party under PAGA, and therefore granted Nabors’s motion to recognize the automatic stay.
Court Description: California Private Attorney General Act /. Automatic Stay The panel granted the motion of Nabors Drilling USA, L.P. to recognize an automatic stay, triggered by its filing for reorganization under Chapter 11 of the Bankruptcy Code, in a lawsuit file by plaintiff Jeremy Porter, who asserted a claim under California’s Private Attorney General Act of 2004 (“PAGA”). The panel held that the exception to an automatic stay established in 11 U.S.C § 362(b)(4), described as the governmental regulatory or governmental unit exception, did not apply to a claim brought by a private party under PAGA. Because the governmental unit exception to the automatic bankruptcy stay did not apply to Porter’s PAGA action, the panel concluded that the automatic stay did not apply to the action, including the appeal currently before the court. The panel suspended further activity in this appeal.
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