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Chicago’s Judge David Cleary called for post-confirmation arbitration of claims between the debtor and a creditor, but no arbitration for the creditor’s defenses, raising questions of bankruptcy law.
A class action in Chicago will decide whether bankruptcy judges have the tools to rectify a single creditor’s violation of the rights of similarly situated debtors.
Reversing the bankruptcy court, the Chicago district judge follows the Fourth and Fifth Circuits and rejects a contrary holding by the Ninth Circuit BAP.
Chicago’s Bankruptcy Judge Timothy Barnes explained eight years ago why bankruptcy stays do not require personal jurisdiction, unlike injunctions in receiverships.