Bankruptcy Court

The 94 United States bankruptcy courts function as units of the district courts and have jurisdiction over all of the bankruptcy cases that are filed in this country. Bankruptcy cases are not filed in state courts. The current system of bankruptcy courts was created by United States Congress in 1978, effective April 1, 1984.

U.S. bankruptcy judges are appointed for terms of 14 years. Each judge makes up a “unit” of the applicable United States district court for the circuit in which the applicable district is located.

Although the United States district courts actually have subject matter jurisdiction over bankruptcy matters, each such district court may “refer” bankruptcy matters to the bankruptcy court. In actuality, most district courts have a standing “reference” order to that effect, so all bankruptcy cases in that district are handled by the bankruptcy court, at least at first. Occasionally, a district court may “withdraw the reference” (i.e., take the case or a particular proceeding within the case away from the bankruptcy court and decide the matter itself).

The overwhelming majority of all proceedings in bankruptcy are held before a United States bankruptcy judge, whose decisions are subject to appeals to the district court. In some judicial circuits, appeals may be taken to a Bankruptcy Appellate Panel.

Bankruptcy courts appoint trustees to represent the interests of the creditors and administer the cases. Chapter 7 trustees are appointed by the U.S. Trustee for a renewable period of one year. Chapter 13 trustees, however, are “standing trustees” who administrator cases in a specific geographic region.

The Federal Rules of Bankruptcy Procedure govern procedure in the U.S. bankruptcy courts.

Interesting, the decisions of the Bankruptcy Courts are not gathered and published in an official report produced by the government. Instead, the de facto official source for opinions of the Bankruptcy Courts is West’s Bankruptcy Reporter, published privately by Thomson West.

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