A 2011 U.S. Supreme Court ruling in Stern v. Marshall that concerned the litigation of non-bankruptcy issues in bankruptcy court has led to the development of the Stern Amendments to the Federal Rules of Bankruptcy Procedure, which will become effective on December 1, 2016.
The Stern Amendments alter Bankruptcy Rules 7008, 7012, 7016, 9027, and 9033 as follows:
General Rules of Pleading (BR 7008) — Litigant may state whether he/she does or does not consent to a final determination by a bankruptcy court. This change eliminates the prior requirement that the pleader state whether the proceeding is core or non-core.
Defenses and Objections (BR 7012) — In regard to responsive pleading, eliminates the core/non-core distinctions in favor of the granting or withholding of consent to resolve an issue in the bankruptcy court.
Pretrial Procedures (BR 7016) — Provides the bankruptcy court with three options:
- Hear and determine the dispute
- Hear and issue proposed findings of fact and conclusions of law for district court
- Take some other action
Removal (BR 9027) — In regard to removal, eliminates the core/non-core distinctions in favor of the granting or withholding of consent to resolve an issue in the bankruptcy court.
Proposed Findings of Fact and Conclusions of Law (BR 9033) — Makes the service of proposed findings of fact and conclusions of law applicable to both core and non-core proceedings.
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