Bankruptcy courts help people and businesses who cannot pay their debts get a fresh start.
What are Bankruptcy Courts?
A fundamental goal of federal bankruptcy law is to give debtors a “fresh start” from certain debts. Federal courts have exclusive jurisdiction over bankruptcy cases.
A petition for bankruptcy may be filed by an individual, by spouses together, or by a corporation or other entity.
What is the Structure of Bankruptcy Courts?
Bankruptcy courts are units of the district courts that hear and determine bankruptcy cases and proceedings referred to them by the district courts. There are 90 bankruptcy courts.
The U.S. Bankruptcy Code provides the law applicable to bankruptcy cases and proceedings and the Federal Rules of Bankruptcy Procedure and local rules of the bankruptcy courts provide procedural requirements.
A bankruptcy court’s rulings can be appealed to the district court, to a bankruptcy appellate panel in circuits that have them, or to the court of appeals directly, if certain statutory requirements are met.
Bankruptcy Appellate Panels (BAPs) are three-judge panels authorized to hear appeals of bankruptcy court decisions. A BAP is established by a circuit’s judicial council, and five circuits have BAPs: First Circuit, Sixth Circuit, Eighth Circuit, Ninth Circuit, and Tenth Circuit.
What Types of Cases are Heard in Bankruptcy Courts?
Bankruptcy generally provides two options: liquidation or reorganization.
- Liquidation is the selling of a debtor’s assets, if any are available, to pay creditors.
- Reorganization involves obtaining a bankruptcy judge’s approval of a plan for repayment over time of all or a portion of the debts owed to creditors.
There are different types of bankruptcies, which are usually referred to by their chapter under the U.S. Bankruptcy Code. Learn more about federal bankruptcy laws and the bankruptcy process.
Who Serves in Bankruptcy Courts?
Bankruptcy judges are judicial officers of the district court who preside over bankruptcy cases and proceedings referred to them by the district courts.
Bankruptcy Court Statistics
Review bankruptcy filings statistics for quarterly filings data tables.
View the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) Report, an annual report that provides statistics on debtors seeking bankruptcy relief under chapters 7, 11, and 13 of the Bankruptcy Code.
For additional information about bankruptcy courts, see: