Lac du Flambeau Band of Lake Superior Chippewa Indians v. Coughlin

by Supreme Court of the United States

Note: Where it is feasible, a syllabus (headnote) will be released, as is being done in connection with this case, at the time the opinion is issued. The syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader. See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.

SUPREME COURT OF THE UNITED STATES

Syllabus

LAC DU FLAMBEAU BAND OF LAKE SUPERIOR CHIPPEWA INDIANS ET AL. v. COUGHLIN
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIRST CIRCUIT
No. 22–227. Argued April 24, 2023—Decided June 15, 2023

Petitioner Lac du Flambeau Band of Lake Superior Chippewa Indians (the Band) is a federally recognized Indian tribe. One of the Band’s businesses, Lendgreen, extended respondent Brian Coughlin a payday loan. Shortly after receiving the loan, Coughlin filed for Chapter 13 bankruptcy, triggering an automatic stay under the Bankruptcy Code against further collection efforts by his creditors. But Lendgreen allegedly continued attempting to collect Coughlin’s debt. Coughlin filed a motion in Bankruptcy Court to enforce the automatic stay and recover damages. The Bankruptcy Court dismissed the suit on tribal sovereign immunity grounds. The First Circuit reversed, concluding that the Code “unequivocally strips tribes of their immunity.” 33 F. 4th 600, 603.

Held: The Bankruptcy Code unambiguously abrogates the sovereign immunity of all governments, including federally recognized Indian tribes. Pp. 3–16.

(a) Two provisions of the Bankruptcy Code lie at the heart of this case. The first, 11 U. S. C. §106(a), expressly abrogates the sovereign immunity of “governmental unit[s]” for enumerated purposes. The second, §101(27), defines “governmental unit” as “United States; State; Commonwealth; District; Territory; municipality; foreign state; department, agency, or instrumentality of the United States … , a State, a Commonwealth, a District, a Territory, a municipality, or a foreign state; or other foreign or domestic government.” In order for these provisions to abrogate tribal sovereign immunity, Congress “must [have made] its intent … ‘unmistakably clear in the language of the statute.’ ” Financial Oversight and Management Bd. for P. R. v. Centro De Periodismo Investigativo, Inc., 598 U. S. ___, ___. If the statute can plausibly be read to preserve sovereign immunity, Congress has not unambiguously expressed the requisite intent. FAA v. Cooper, 566 U. S. 284, 290. But Congress need not use any particular words to pass this clear-statement test. Pp. 3–4.

(b) The Bankruptcy Code unequivocally abrogates the sovereign immunity of any and every government with the power to assert such immunity. Because federally recognized tribes unquestionably fit that description, the Code’s abrogation provision plainly applies to them as well. Pp. 4–16.

(1) Several features of the statute’s text and structure point the way. To start, the definition of “governmental unit” exudes comprehensiveness. It begins with a long list of governments, varying in location, nature, and size. It then proceeds to capture subdivisions and components of every government in that list. And it concludes with a broad catchall phrase, sweeping in “other foreign or domestic government[s].” §101(27). Moreover, the catchall phrase’s pairing of extremes—i.e., “foreign or domestic”—appearing at the end of an extensive list unambiguously indicates Congress’s intent to cover all governments in §101(27)’s definition. The abrogation provision in §106(a) in turn applies to every “governmental unit” in §101(27). It does not cherry-pick certain types of governments from that capacious list. Pp. 4–6.

(2) Other provisions of the Bankruptcy Code reinforce §106(a) and §101(27)’s plain text. To facilitate an “orderly and centralized” debt-resolution process, 1 Collier on Bankruptcy ¶1.01 (16th ed. 2023), the Code includes a number of requirements, like the automatic stay provision, that generally apply to all creditors. These basic requirements can be enforced against all kinds of creditors, whether the creditor is a governmental unit or not. At the same time, the Code contains limited exceptions to avoid impeding the functioning of governmental entities when they act as creditors. See, e.g., §362(b)(4). Reading the statute to carve out certain governments from the definition of “governmental unit”—as petitioners would have the Court do—risks upending the policy choices that the Code embodies. And there is no indication that Congress meant to categorically exclude certain governments from these provisions’ enforcement mechanisms and exceptions. Pp. 6–8.

(3) Federally recognized tribes are indisputably governments. They exercise uniquely governmental functions, and both Congress and this Court have repeatedly characterized them as governments. Accordingly, because the Bankruptcy Code unequivocally abrogates the sovereign immunity of all governments, and tribes undoubtedly count as governments, the Code unmistakably abrogates tribal sovereign immunity. Pp. 8–9.

(c) Petitioners fail to sow doubt into these clear statutory provisions. Pp. 10–15.

(1) Petitioners insist that neither §101(27) nor §106(a) mentions tribes by name. But Congress need not use any particular words to make its abrogation intent clear. Cooper, 566 U. S., at 291. And the fact that Congress has referenced tribes specifically in other statutes abrogating tribal sovereign immunity does not foreclose it from using different language to accomplish that same goal in other statutory contexts. Pp. 10–11.

(2) Petitioners also contend that the catchall phrase “other foreign or domestic government” can plausibly be read to include only entities that are purely foreign “or” purely domestic. In petitioners’ view, the catchall phrase would thus exclude tribes or other governments that have foreign and domestic features. But Congress has expressly instructed that the word “or,” as used in the Code, “is not exclusive.” §102(5). In any event, petitioners do not explain why the Bankruptcy Code would draw such a line in the sand.

Finally, petitioners suggest that Congress has historically treated various types of governments differently for purposes of bankruptcy law, relying on provisions preceding the Bankruptcy Code’s enactment. Yet petitioners fail to demonstrate that the Code—which comprehensively revised bankruptcy practice—carried forward any such differential treatment. Pp. 11–15.

33 F. 4th 600, affirmed.

Jackson, J., delivered the opinion of the Court, in which Roberts, C. J., and Alito, Sotomayor, Kagan, Kavanaugh, and Barrett, JJ., joined. Thomas, J., filed an opinion concurring in the judgment. Gorsuch, J., filed a dissenting opinion.

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