New FAA Cert Grant – FAA vs Bankruptcy Code

Last week, the Court granted cert to decide whether a bankruptcy court can override the FAA. The case is Goldman Sachs Bank USA v. Brown (No. 25-1408). When a creditor allegedly violates the automatic stay of the Bankruptcy Code, who gets to decide whether the creditor violated the law? A bankruptcy court or an arbitrator? Looking at the FAA from a textualist, originalist, historical view, I believe the answer is clear (a court), but the Supreme Court has painted itself into a corner over the decades with flawed FAA decisions. Recent decisions suggest that at least some Justices may be willing to cut back on the FAA’s broad applicability, but the FAA has a pretty good winning streak in overriding other statutes. I am eager to see how this clash between the FAA and the Bankruptcy Code plays out and whether the Bankruptcy Code can break the FAA’s winning streak.

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