Since the economic downturn took hold in 2008, millions of Americans have turned to the bankruptcy courts for relief. Some of these debtors have alleged systemic violations of the Bankruptcy Code by banks and other providers of financial services, and have sought to certify nationwide debtor-plaintiff classes. Yet fundamental tensions between the traditional precepts of bankruptcy jurisdiction and the principles underlying class actions have given rise to uncertainty as to whether bankruptcy courts can certify such classes.
To understand the roots of this uncertainty, one must first consider the nature of bankruptcy jurisdiction. Congress passed the current Bankruptcy Code in 1984, under its Constitutional authority to "establish…uniform laws on the subject of bankruptcies throughout the United States."1 The Code was revised in response to Northern Pipeline Constr. v. Marathon Pipe Line, 458 U.S. 50 (1982), in which the Supreme Court held that the Bankruptcy Act of 1978 unconstitutionally conferred Article III judicial powers on non-Article III bankruptcy judges (who do not enjoy life tenure and other Article III protections).
