bankruptcy

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Debtors Urge Supreme Court to Deny Review in Goldman Sachs Automatic Stay Arbitration Case

Respondents Say There Is No Genuine Circuit Split and Goldman’s Position Would Divide Enforcement of the Automatic Stay Between Bankruptcy Courts and Arbitrators

UPDATE: Rhea Brown and Gregory Maze have filed their brief opposing Goldman Sachs Bank USA’s petition for certiorari in Goldman Sachs Bank USA v. Brown, No. 25-1408, asking the Supreme Court to leave intact the Fourth Circuit’s decision permitting the bankruptcy court to retain their claims for violations of the automatic stay.

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NCBRC, NACBA, and NCLC Urge Ninth Circuit to Affirm Discharge of Mixed-Purpose Private Student Loan

Amicus Brief Argues Mixed-Purpose Loans and Loans for Non-Title IV-Eligible Programs Do Not Qualify for § 523(a)(8)(B)’s Exception to Discharge

The National Consumer Bankruptcy Rights Center (NCBRC), the National Association of Consumer Bankruptcy Attorneys (NACBA), and the National Consumer Law Center (NCLC) have filed an amicus brief in the Ninth Circuit in Nichols v. Pearson (In re Pearson), Nos. 26-1962 & 26-1963, urging the court to affirm a Bankruptcy Appellate Panel decision holding that a private educational loan that does not satisfy the statutory definition of a “qualified education loan” is dischargeable in bankruptcy.

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Seventh Circuit Holds Illinois Tax Purchaser Entitled to 18% Interest Rate in Chapter 13

Divided Court Holds Tax Purchaser Has a “Tax Claim” Under § 511(a); Judge Hamilton Warns Decision Gives Private Investor a Windfall and Makes Chapter 13 Relief More Difficult

In In re Romero, No. 25-2021 (7th Cir. July 16, 2026), the Seventh Circuit affirmed a bankruptcy court ruling that an Illinois tax purchaser holds a “tax claim” under 11 U.S.C. § 511(a) and is entitled to an 18% annual interest rate when its claim is paid through a Chapter 13 plan.

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Second Circuit Holds Debtor Lacked Standing to Seek Preemptive Determination of Tax Dischargeability

Court Rules Bankruptcy Court Should Have Deferred to IRS’s Later-Filed—but First Jurisdictionally Proper—District Court Action

In In re Goebel, No. 25-103 (2d Cir. July 28, 2026), the Second Circuit held that a Chapter 7 debtor lacked Article III standing to obtain a determination of the dischargeability of federal income-tax debts where, at the time she filed her adversary complaint, the IRS had not taken any concrete action indicating that it intended to assert that the debts were nondischargeable.

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Michigan Supreme Court Leaves Presentment Ruling in Place; Governor Vetoes Bankruptcy Exemption and Garnishment Reforms

Court victory preserves the constitutional presentment requirement, but veto leaves vulnerable Michigan consumers without long-overdue protections

On July 10, 2026, the Michigan Supreme Court denied the applications for leave to appeal in Senate v. House of Representatives, leaving undisturbed the Michigan Court of Appeals’ ruling that the House must present nine previously passed bills to the Governor. Later that same day, Governor Gretchen Whitmer vetoed all nine bills—including House Bills 4900 and 4901, which would have substantially modernized Michigan’s garnishment and bankruptcy exemption laws.

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Goldman Sachs Petitions the Supreme Court for Review in Automatic Stay Arbitration Case

In March, we reported on the Fourth Circuit’s 2-1 decision in Goldman Sachs Bank USA v. Brown, No. 25-1439, affirming a bankruptcy court’s refusal to compel arbitration of debtors’ claims for willful violation of the automatic stay under Section 362(k). Goldman Sachs has now sought further review, filing a petition for a writ of certiorari with the United States Supreme Court on June 16, 2026.

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Seventh Circuit Affirms: Chapter 13 Plans May Pay Debtor’s Counsel Before Nonpriority Unsecured Creditors

Court Rejects City of Chicago’s Bid to Subordinate Attorney’s Fees to General Unsecured Claims

In a published opinion, the Seventh Circuit affirmed the confirmation of two below-median Chapter 13 plans that provided for payment of the debtor’s attorney fees ahead of distributions to nonpriority unsecured creditors. In In re Falkner, Nos. 25-2878 & 25-2879 (7th Cir. June 10, 2026), the court rejected the City of Chicago’s sweeping argument that 11 U.S.C. § 1325(b)(1)(B) bars payment of attorneys’ fees during the commitment period until unsecured creditors first receive all of a debtor’s projected disposable income. Writing for a unanimous panel, Judge Scudder held that the Bankruptcy Code as a whole—and decades of settled practice—foreclose the City’s reading. NCBRC and NACBA, joined by two standing Chapter 13 trustees, had filed an amicus brief urging affirmance.

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Unanimous Supreme Court Adopts Totality-of-the-Circumstances Test for Bankruptcy Judicial Estoppel

NCBRC, NCLC, and NACBA Urged a Narrow, Equitable, Fact-Specific Inquiry

In a unanimous decision authored by Justice Jackson, the United States Supreme Court held that courts deciding whether a debtor’s failure to disclose a claim in bankruptcy was “inadvertent or mistaken”—for purposes of judicial estoppel—must look to the totality of the circumstances surrounding the omission. In Keathley v. Buddy Ayers Construction, Inc., No. 25–6 (June 11, 2026), the Court rejected the Fifth Circuit’s narrow rule, which had limited the inquiry to just two questions: whether the debtor knew the facts underlying the claim, and whether the debtor had a potential motive to conceal it. The Court vacated and remanded, holding the Fifth Circuit’s formulation was “simultaneously too rigid and too broad.”

The decision is a significant win for consumer debtors. NCBRC, joined by the National Consumer Law Center (NCLC) and the National Association of Consumer Bankruptcy Attorneys (NACBA) and the National Consumer Law Center (NCLC) filed an amicus brief in December 2025 urging the Court to decide the bad-faith question narrowly and to refrain from expanding debtors’ disclosure duties. The Court did exactly that, expressly declining to resolve the broader bad-faith dispute and presuming—without opining—on whether a continuing duty to disclose post-petition assets exists.

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Michigan Supreme Court Asked to Let Stand Court of Appeals Ruling Compelling Presentment to the Governor of Previously Passed Bankruptcy Exemption Modernization Bill

NACBA and NCBRC File Amicus Brief Urging Court to Deny Leave to Appeal

In the latest development in the ongoing constitutional dispute over the Michigan Legislature’s failure to present nine duly enacted bills to the Governor—including the critical consumer-protection measure HB 4901—the National Association of Consumer Bankruptcy Attorneys (NACBA) and the National Consumer Bankruptcy Rights Center (NCBRC) have filed an amicus brief before the Michigan Supreme Court. The brief, filed on April 16, 2026, urges the Court to deny leave to appeal and to uphold the Court of Appeals’ decision requiring issuance of a writ of mandamus compelling presentment.

The brief was authored by NCBRC Officer and NACBA member Matt Mason, together with co-counsel and NACBA member Alexander Berry-Santoro of Maxwell Dunn, PLC.

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Fourth Circuit Holds In Chapter 13, Good-Faith Review May Consider Pre-Filing Accumulation of Secured Debt

In a published opinion, the Fourth Circuit affirmed the denial of confirmation of an above-median Chapter 13 debtor’s plan that proposed to pay off three recently purchased vehicles while paying unsecured creditors less than eight cents on the dollar. In Goddard v. Burnett, No. 25-1303 (4th Cir. Apr. 28, 2026), the court held that technical compliance with the disposable-income test under Section 1325(b) does not insulate a plan from the separate good-faith requirement of Section 1325(a)(3) which allows the court to examine the timing and classification of debt incurred pre-petition.

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