Lac du Flambeau Band of Lake Superior Chippewa Indians v. Coughlin
599 U.S. 382
| SCOTUS | 2023Background
- The Lac du Flambeau Band (a federally recognized tribe) wholly owns Lendgreen, a payday-lending business that made a high‑interest loan to Brian Coughlin.
- Coughlin filed Chapter 13 bankruptcy; the filing triggered the automatic stay under 11 U.S.C. § 362, but Lendgreen allegedly continued collection efforts.
- Coughlin moved in bankruptcy court to enforce the stay and recover damages under § 362(k); the Bankruptcy Court dismissed for lack of subject‑matter jurisdiction, ruling tribal sovereign immunity barred the suit.
- The First Circuit reversed, holding the Bankruptcy Code (11 U.S.C. §§ 101(27), 106(a)) unambiguously abrogates tribal sovereign immunity; the Supreme Court granted certiorari to resolve a circuit split.
- The Supreme Court affirmed: it held § 106(a), read with § 101(27)’s broad definition of “governmental unit,” unambiguously abrogates sovereign immunity of all governments that can assert it — including federally recognized Indian tribes. Justices Thomas (concurring in judgment) and Gorsuch (dissenting) filed separate opinions.
Issues
| Issue | Plaintiff's Argument (Coughlin) | Defendant's Argument (Band) | Held |
|---|---|---|---|
| Whether 11 U.S.C. § 106(a) abrogates tribal sovereign immunity | §106(a) expressly abrogates immunity of “governmental unit[s],” and §101(27) defines that term broadly to include tribes | Abrogation requires an unmistakably clear statement; §101(27)/§106 do not expressly name tribes, so Congress did not clearly abrogate | Held: Yes. Court: §106(a) unambiguously abrogates sovereign immunity of any government that can assert it, including tribes |
| Whether §101(27)’s definition of “governmental unit” includes federally recognized tribes | The long enumerated list plus the catchall “other foreign or domestic government” is comprehensive and covers tribes | Tribes are sui generis (neither purely foreign nor purely domestic); the catchall is ambiguous and does not clearly encompass tribes | Held: Yes. Court: the definition is comprehensive; pairing “foreign or domestic” signals all‑inclusiveness, so tribes qualify |
| Whether Congress must expressly name “Indian tribes” to satisfy the clear‑statement rule | No — Congress need not use particular words if statutory text and structure make intent unmistakable | Yes — historical practice shows Congress typically names tribes when abrogating tribal immunity; omission is significant | Held: No. Court: explicit naming is not required; clear‑statement met by the statute's text and structure |
| Whether statutory purpose, prior bankruptcy practice, or historical treatment create a plausible ambiguity saving tribal immunity | Code’s centralized, comprehensive scheme and limited, explicit exceptions show Congress intended uniform application to governmental creditors | Historical differential treatment and constitutional/precedential materials create a plausible alternative reading preserving immunity | Held: Court: the Code’s text, structure, and purposes reinforce abrogation; petitioners’ historical/policy arguments do not create a plausible ambiguity |
Key Cases Cited
- Santa Clara Pueblo v. Martinez, 436 U.S. 49 (recognizing tribal sovereign immunity as a common‑law baseline)
- Michigan v. Bay Mills Indian Community, 572 U.S. 782 (2014) (reaffirming tribal immunity baseline and the clear‑statement requirement; discussed off‑reservation commercial‑activity limits)
- Financial Oversight & Management Bd. for P.R. v. Centro De Periodismo Investigativo, Inc., 598 U.S. 339 (2023) (reciting the need for unmistakably clear congressional intent to abrogate sovereign immunity)
- FAA v. Cooper, 566 U.S. 284 (2012) (ambiguities in statute preserve sovereign immunity)
- United States v. Nordic Village, Inc., 503 U.S. 30 (1992) (requires clear statement for abrogation of sovereign immunity)
- Central Va. Community College v. Katz, 546 U.S. 356 (2006) (recognizing that the Bankruptcy Code can abrogate sovereign immunity in certain contexts)
- Kiowa Tribe of Oklahoma v. Manufacturing Technologies, Inc., 523 U.S. 751 (1998) (acknowledging tribal sovereign immunity doctrine)