For too long, Younger v. Harris – unexamined and taken for granted – has served to keep bankruptcy’s promised benefits tantalizingly out of the reach of some debtors. By seriously limiting the circumstances under which a federal court can enjoin state criminal proceedings, Younger has effectively eliminated all of the exceptions to the Anti-Injunction Act. That alone is worthy of discussion and has attracted some attention, but none of that attention has taken a bankruptcy focus, even though bankruptcy is one of the eviscerated exceptions. Re-examination of Younger through a bankruptcy lens is long overdue, and recent developments, although seemingly unrelated to these questions, make a renewed discussion timely.
The need for a federal injunction against state criminal proceedings arises when those proceedings serve a debt-collection purpose and, in addition, involve a debt that is (or, under a proper construction of law, ought to be) dischargeable. This Article argues that Younger should not be an impediment to such an injunction, given the uniqueness of bankruptcy and the distinctions between it and the civil rights context from which Younger evolved.
This Article will begin with the Anti-Injunction Act and its bankruptcy exception. This Article will then discuss Younger‘sjudicially-created abstention doctrine that all but repeals the statute’s exceptions, as well as the interpretation given Younger byMitchum v. Foster, which was decided the following year. While convincing arguments against Younger have been made for decades, this Article’s goal is more modest – to demonstrate why the bankruptcy exception to the Anti-Injunction Act should be given its full force, Younger (and Mitchum)to the contrary notwithstanding.
This Article will then review the Bankruptcy Code’s injunction provisions, demonstrating that, notwithstanding an exception to the automatic stay, criminal proceedings rooted in statutes having a collection, rather than penal, purpose are not immune from the reach of a bankruptcy court injunction designed to protect a debtor’s right to discharge.
Finally, this Article will demonstrate that certain restitutionary obligations should be dischargeable in Chapter 7 bankruptcy cases. To do so, this Article will undertake the text-based analysis of the Code eschewed by the Supreme Court when, undoubtedly misled by Younger, it held to the contrary in Kelly v. Robinson.
The scope of discharge is for Congress to determine and, to date, Congress has been unreceptive to arguments that restitution ordered by a state criminal court, pursuant to a collection-oriented criminal statute, should be a dischargeable obligation. Concededly, the argument for discharge of such obligations is narrow, but an argument is available nonetheless. In any event, its narrowness does not affect the point here – namely, that federalism doctrines should not protect state efforts to determine the scope of a federal bankruptcy discharge by criminalizing the failure to pay certain debts. Congress determines the scope of discharge, through the vehicle of the Bankruptcy Code.