In overruling the appellate panel and the bankruptcy court, the Ninth U.S. Circuit Court of Appeals recently made a clear statement as to how issues of conflict between the state courts and the federal system should be resolved on issues of discharge and the effect of a permanent injunction granted by the discharge.
On May 7, in McGahn v. Rutz, 288 F.3d 1172 (9th Cir. 2002), the Ninth Circuit ruled that a state court had no jurisdiction to determine issues of dischargeability of a debt.
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