Supreme Court: States Can be Sued under Bankruptcy Law

Published on:
12 September 2006 at 10:20 a.m. ET

Written by: Unknown Author –

http://www.insidearm.com/news/00012575-supreme-court-states-can-be-sued-under-ba/

States can be sued in certain bankruptcy proceedings, a divided U.S. Supreme Court ruled on Monday in a case that pitted state powers against those of the federal government.

By a 5-4 vote, the high court rejected arguments that states could not be sued because of state sovereign immunity. The court said Congress, in adopting the bankruptcy law, has the power to treat states the same way as other creditors.

The decision departed from the series of rulings in recent years by the court’s conservative majority that generally have expanded the immunity of states from lawsuits while cutting back on the power of Congress.

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