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September 30, 2017

Senate passes bankruptcy judgeship legislation

The Senate passed legislation Sept. 5 to extend 14 temporary bankruptcy judgeships for five years and create four new bankruptcy judgeships.

The bill, S. 1107, differs from legislation passed by the House in May. The House bill, H.R. 2266, sponsored by House Judiciary Committee Ranking Member John Conyers Jr (D-Mich.) and committee Chairman Bob Goodlatte (R-Va.), closely followed the recommendations of the Judicial Conference of the United States, which conducted a rigorous needs assessment of the bankruptcy courts.

The Judicial Conference recommended making the 14 temporary judgeships permanent and authorizing four new judgeships. Although bankruptcy filings have been declining nationwide recently, there have been sustained increases in filings in the courts included in the Judicial Conference recommendations.

The ABA supports the use of authorizing legislation to address the issues facing the bankruptcy courts. In a May 9 letter to the House Judiciary Committee, ABA Governmental Affairs Director Thomas M. Susman explained that Congress has not created a new bankruptcy judgeship since 1992 and has instead been handling the situation through a piece-meal approach with temporary judgeships. Most recently, the current 14 temporary judgeships were extended for one year as part of fiscal year 2017 appropriations legislation enacted in May.

Susman said that instead of relying on appropriators to temporarily avert the next crisis, the House bill “will restore stability and functionality to the system by addressing the demonstrated need for permanent bankruptcy judgeships in a comprehensive and lasting manner.”

Sen. Chris Coons (D-Del.), who sponsored S. 1107, noted that his bill would give the bankruptcy courts the judges they need to manage pressing caseloads.

“A well-functioning bankruptcy court system is critical for ensuring that individuals and corporations can go through bankruptcy efficiently. When a corporation is restructuring, delays can mean lost jobs and lost revenue,” he said.