Stern v. Marshall

180 L. Ed. 2d 475 · Supreme Court of the United States · 2011

Facts

Vickie Lynn Marshall (Anna Nicole Smith) filed a tortious interference counterclaim against E. Pierce Marshall in her California bankruptcy proceeding, alleging he prevented her from receiving an expected gift from J. Howard Marshall II. The Bankruptcy Court entered a final judgment for Vickie, awarding her over $400 million, but the Court of Appeals reversed, finding the Bankruptcy Court lacked authority.

Issue

Did the Bankruptcy Court have the statutory authority under 28 U.S.C. § 157(b) to issue a final judgment on Vickie's state law tortious interference counterclaim, and if so, was conferring that authority constitutional under Article III?

Holding

The Supreme Court held that the Bankruptcy Court had statutory authority under 28 U.S.C. § 157(b)(2)(C) to enter final judgment on Vickie's counterclaim. However, it lacked the constitutional authority under Article III to do so, as such a state law claim between private parties cannot be finally adjudicated by a non-Article III court.

Rule

Article III of the Constitution requires that the judicial power of the United States be vested in courts whose judges have life tenure and salary protection. Congress cannot assign the final adjudication of state common law claims between private parties, which are not matters of "public right" and are not necessarily resolved in the claims allowance process, to non-Article III bankruptcy courts.

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Case brief last reviewed 2026-03-03. Prepared by CaseReader from the published opinion.