{"id":3393,"date":"2024-11-30T18:01:33","date_gmt":"2024-11-30T18:01:33","guid":{"rendered":"https:\/\/usatrustedlawyers.com\/blog\/bankruptcy-police-power-exception-automatic-stay\/"},"modified":"2024-11-30T18:01:33","modified_gmt":"2024-11-30T18:01:33","slug":"bankruptcy-police-power-exception-automatic-stay","status":"publish","type":"post","link":"https:\/\/usatrustedlawyers.com\/blog\/bankruptcy-police-power-exception-automatic-stay\/","title":{"rendered":"Bankruptcy \u2013 Police power exception \u2013 Automatic stay"},"content":{"rendered":"\n<div>\n<p class=\"BODYCOPY\">Where (1) an agency that regulates milk production and distribution revoked a debtor\u2019s dairy license and ordered him to sell his milk production quota rights and (2) when the debtor failed to do so, the agency planned to auction those rights, the agency\u2019s plan to auction the debtor\u2019s milk quota falls squarely within the police power exception to the Bankruptcy Code\u2019s automatic stay provision, 11 U.S.C. \u00a7362.\n<\/p>\n<p class=\"BODYCOPY\">Reversed.\n<\/p>\n<p class=\"BODYCOPY\">\u201cIn this appeal, we consider the \u2018police power\u2019 exception to the Bankruptcy Code\u2019s automatic stay provision, 11 U.S.C. \u00a7362. The police power exception in \u00a7362(b)(4) provides that the automatic stay does not apply to \u2018the commencement or continuation of an action or proceeding by a governmental unit \u2026 to enforce such governmental unit\u2019s or organization\u2019s police and regulatory power, including the enforcement of a judgment other than a money judgment, obtained in an action or proceeding by the governmental unit to enforce such governmental unit\u2019s or organization\u2019s police or regulatory power.\u2019<\/p>\n<p class=\"BODYCOPY\">\u201cIn this case, the Puerto Rico agency that regulates milk production and distribution revoked a bankruptcy debtor\u2019s dairy license and ordered him to sell his milk production quota rights. When the debtor failed to do so, the agency announced plans to auction those rights under the governing regulations. The bankruptcy and district courts found that planning the auction violated the bankruptcy stay under \u00a7362. We find, however, that the agency\u2019s plan to auction the debtor\u2019s milk quota falls squarely within the police power exception in \u00a7362(b)(4). We reverse the judgments of the bankruptcy and district courts and direct judgment in favor of the agency.\u201d\n<\/p>\n<p class=\"BODYCOPY\"><i>In Re: Ruiz Ruiz, Luis Manuel (Lawyers Weekly No. 01-250-24) (29 pages) (Hamilton, J., of the Seventh Circuit, sitting by designation) Appealed from the U.S. District Court for the District of Puerto Rico (Docket No. No. 22-1761) (Nov. 21, 2024).<\/i>\n<\/p>\n<p>Click here to read the full text of the opinion.<\/p>\n<p><iframe loading=\"lazy\" src=\"https:\/\/masslawyersweekly.com\/files\/2024\/11\/01-250-24.pdf\" height=\"1100\" width=\"900\" style=\"\" frameborder=\"0\" scrolling=\"yes\" allowfullscreen=\"\"><\/iframe><br \/>\n<!-- post-single CPT Filter Start --><!-- post-single CPT Filter End    --><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Where (1) an agency that regulates milk production and distribution revoked a debtor\u2019s dairy license and ordered him to sell his milk production quota rights and (2) when [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":3394,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[116],"tags":[4124,128,3437,615,1081,2691],"class_list":["post-3393","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-bankruptcy","tag-automatic","tag-bankruptcy","tag-exception","tag-police","tag-power","tag-stay"],"_links":{"self":[{"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/posts\/3393","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/comments?post=3393"}],"version-history":[{"count":0,"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/posts\/3393\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/media\/3394"}],"wp:attachment":[{"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/media?parent=3393"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/categories?post=3393"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/usatrustedlawyers.com\/blog\/wp-json\/wp\/v2\/tags?post=3393"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}