Bankruptcy Basics – Understanding the Bankruptcy Courts

For those without legal training, understanding the court system in the United States can be difficult. There are both state courts and federal courts, and each court system is comprised of many different levels of courts. Although bankruptcy filings are dealt with entirely in federal courts, the bankruptcy court system has several aspects that are unique. For example, the United States has created courts that specialize only in bankruptcy cases in order to streamline the process.

Filing a bankruptcy case in the wrong court could result in dismissal or expensive delay. Furthermore, individual courts often have specific procedural rules that must be followed. An experienced Oakland Bankruptcy Attorney can help you file your bankruptcy in the correct court, and – if necessary – appeal any issues to a higher court.

What are Bankruptcy Courts?

Bankruptcy Courts are a sub-type of federal district court. This means that they are part of the federal court system, and are not part of the state court system. Typically, a larger state like California will have several federal district courts. In the San Francisco area, bankruptcy cases are brought in the Bankruptcy Court for the Northern District of California. However, bankruptcy cases in other parts of California could be brought in the Eastern District, Central District, or Southern District, depending on which court has jurisdiction over the case.

Bankruptcy Courts have what lawyers refer to as “exclusive and original” jurisdiction over bankruptcy cases. This means that a bankruptcy case must begin in a Bankruptcy Court and cannot be brought in any other court.

Which Courts Hear Cases on Appeal?

Bankruptcy Appellate Panel

In some other states, cases that are appealed from a Bankruptcy Court must be heard next by the district court. However, the Ninth Circuit, which includes California, has set up a different system called a Bankruptcy Appellate Panel (BAP). Like the Bankruptcy Court is a sub-unit of the Federal District Courts, the BAP is a 3-judge panel is sub-unit of the Federal Courts of Appeals.

In California, a party to a bankruptcy case may appeal a Bankruptcy Court decision to the BAP or file an election to transfer their appeal to the district court.

Court of Appeals

If a case is appealed from the BAP, it will be heard next by a United State Court of Appeals, also called a “Circuit Court.” The Ninth Circuit Court of Appeals hears cases that are appealed from federal courts located in California. Because the United States Supreme Court hears a limited number of cases, the Circuit Courts will have the last say in most cases.

An appeal to the Circuit Court will generally be heard by a panel of three judges. However, in some instances the Circuit Court will elect to hear a case en banc. In the Ninth Circuit, this means that an appeal will be heard by a larger panel, consisting of 11 judges.

Supreme Court

Although it is unusual, bankruptcy cases are sometimes appealed to the United States Supreme Court, which is the highest court by which a case in the United States can be heard. A case is appealed to the Supreme Court by filing a petition for a writ of certiorari. Although the Supreme Court receives about 10,000 petitions each year, it only chooses to hear arguments in about 75 or 80 cases each year (less than 1 percent).

The Law Offices of Melanie Tavare is a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code