We are always hearing that "we are all textualists now," though some of us are textualists manqué who write such aggressively atextual faux-textualist opinions as to confuse people into writing thoughtful but badly mistaken articles claiming that textualism has worked itself impure, when in fact textualism's true evolutionary direction is one of inexorable radicalization and oversimplification. (For a thoughtful and thought-provoking example of a really radicalized textualism, see Judge Kavanaugh's "Fixing Statutory Interpretation," which not only proposes to do away with the usual targets of (much of) Chevron and any reliance on legislative history, but also would junk presumptions of non-redundancy, consistent usage, and eiusdem generis in favor of determining the "best reading" of a statute's text absent many of the most popular and natural contextual rules of thumb for doing that.) But aside from how many true textualists the courts really have in a strict sense, and I'm inclined to say not that many,* there are statutory opinions the Supreme Court puts out to this day that don't even look textualist or try to look it. These cases—not taught in legislation classes and little-noticed outside the fields on which they bear—tend to be cases where the statute itself gives the Court little direction, emboldening the Court to strike out in strikingly old-fashioned purposivist directions—so much so, I'll suggest, that an agency couldn't get away with them at Step Two of Chevron.
* If the courts are truly stocked with textualists, why do we still use legislative history to resolve ambiguities? The true theory of most American federal statutory interpretation, I would contend, is a chastened intentionalism, or an incoherent eclecticism.
A. The problem.
Midland Funding, LLC v. Johnson was such a case this term; it involved whether filing a claim for a time-barred debt in a chapter 13 bankruptcy is an "unfair or unconscionable means" of collecting a debt. The Fair Debt Collection Practices Act (FDCPA) gives a cause of action to debtors whose debt collectors attempt to collect from them by an "unfair or unconscionable means"; besides a set of illustrative but far-from-exhaustive or terribly illuminating examples, the statute does nothing to help courts decide whether a means of debt collection is unfair or unconscionable.
The lower courts have long held that (though the Court has never decided whether) suing unsophisticated debtors in small-claims court on time-barred debts on the hope that they won't defend or assert a statute-of-limitations defense is an unfair means of debt collection. This seems sensible enough, though the defense is usually the debtor's to waive if he wants (supposing he knows he's got the defense or how to assert it, which is the problem). What about filing a claim in a chapter 13 bankruptcy on a time-barred debt? That's a bit different, and hence split the circuits.
The difference is that, in a chapter 13 case, an expert if harried lawyer in the person of a chapter 13 trustee, whose job is to litigate on behalf of the debtor's legitimate creditors, interposes herself between the debtor and creditors. If a claim is stale, that might, depending on the debtor's proposed terms of payment in his plan (a payment plan all chapter 13 debtors must file), dilute what the trustee's beneficiaries (so to speak) get paid. And so the hope is that the trustee will catch a time-barred claim and object to its allowance. If all that pans out, or can be expected to pan out often enough, maybe it's not so unfair to file a claim on a time-barred debt in a chapter 13 bankruptcy, any more than it would be unfair or unconscionable (as opposed to merely bad form or a waste of time) to sue Amazon on one.
B. How should we deal with such an open-textured interpretive question?
How should a court go about interpreting a phrase like "unfair or unconscionable means to collect or attempt to collect any debt"? It will often be maintained that when Congress writes something so hopelessly vague as that, of course it intends to delegate a great deal of essentially legislative power to the courts to decide what ought to be deemed unfair or unconscionable.* I'm not sure I'm even willing to concede that much; it strikes me that the courts should at least try to figure out whether a Congressman of 1977, when the FDCPA was written, would think filing a claim on a knowingly time-barred debt was unfair or unconscionable, or not, or to ask how a consumer debtor or debt collector of the time would (if being honest with themselves) understand the phrase in this context. I'm not quite sure why the fact that Congress was unsurprisingly unable to produce a code of debt collection and forced to sanction bad practices generically means that it wanted the courts to make normative judgments about what they deem bad, rather than looking to some ordinary understanding or popular judgment about what's bad and what's not, at least to the extent that's possible.
* As far as I'm aware, the growing crowd of non-delegation revivalists has no problem at all
with this sort of thing, which is because non-delegation revivalists
don't really mind delegation as such, but rather are driven by a
desire to minimize the power of administrative agencies and maximize
that of the courts—but I digress.
That said, I can at least see a textualist argument that the understanding of unfairness and unconscionability the Court ought to look to is the Court's own, and of course I can certainly see a purposivist argument that in interpreting the statute to root out the sorts of unfair practices the statute was enacted to root out, a court is left to reason about what it deems unfair. What I cannot see much of an argument for of any sort, other than a rather free-wheeling purposivist or Posnerian pragmatic one, is that in deciding what an unfair and unconscionable means is, the Court should ask itself whether it makes sense to ban a means of debt collection or not for policy reasons that have nothing to do with its unfairness or unconscionability. Yet it is just that mode of reasoning, I will claim, that determined the outcome in Midland Funding.
C. Justice Breyer's opinion.
Justice Breyer's explanation for the Court of why filing a claim on a time-barred debt in a chapter 13 bankruptcy isn't unfair or unconscionable spans about five wide-margined pages, the last of which correctly dispels an argument that the Federal Bankruptcy Rules' equivalent of Rule 11 somehow settled the matter and has nothing to do with his positive case for the Court's holding. His reasoning begins with an extraordinarily vague rendition of the ostensibly greater protections in bankruptcy court, vis-a-vis state court, that make it more likely that an attempt to collect on a stale claim in bankruptcy will be caught out. These protections, exactly as he puts them, are as follows:
"A knowledgeable trustee is available." (Citation to the statute creating the office omitted.)
"Procedural bankruptcy rules more directly guide the evaluation of claims." (Citation to one such rule and an advisory committee note on it omitted.)
An appellate panel of bankruptcy judges once wrote that the bankruptcy "claims resolution process is 'generally a more streamlined and less unnerving prospect for a debtor than facing a collection lawsuit.'" (Citation to their opinion and a statute that he parenthetically describes as "outlining generally the claims resolution process" omitted).
Having ticked off "[t]hese features of a Chapter 13 bankruptcy proceeding"—the features, apparently, include its reassuringly streamlined and only mildly unnerving qualities—he concludes that it's "considerably more likely that an effort to collect upon a stale claim in bankruptcy will be met with resistance, objection, and disallowance." Just how likely is left unsaid. Next, he considers an argument that there's simply no good reason to allow creditors to try to get paid on stale claims, even if they run a relatively low chance of succeeding. He's unconvinced because (a) it's the trustee's burden to point the staleness out, and (b), citing his discussion a page above, "protections available in a Chapter 13 bankruptcy proceeding minimize the risk to the debtor."
I want to suggest that these initial assurances of chapter 13 protections have next to nothing to do with the actual reason for Justice Breyer's and many of the concurring Justices' votes, and that their real reasons can be found in the balance of Justice Breyer's positive argument for the Court's holding. I think this for a number of reinforcing reasons.
The first is the argument's remarkable thinness. Justice Breyer is an able empiricist, and if he thought he had a strong case for the claim that stale claims are likely to be caught out in chapter 13 bankruptcy, he would lay it out, likely with an appendix; he wouldn't say things, and only say things, like "bankruptcy rules more directly guide the evaluation of claims," and "the claims resolution process is . . . more streamlined and less unnerving." Nor can we imagine, I hope, the rest of the Court actually deciding a case on the basis of these essentially contentless claims, as opposed to some other, better reason.
The second is that the experts on the matter, the National Association of Chapter Thirteen Trustees, filed an excellent trustee-authored amicus brief explaining why their members were not especially likely to catch or object to stale claims. Justice Breyer normally is interested in this sort of brief, and their explanations are quite convincing: (1) chapter 13 trustees are swamped with claims, (2) claims sometimes don't contain enough detail to say if they're stale and trustees don't spend their limited time gathering information on potential defenses to small claims, (3) chapter 13 plans are often structured in such a way that creditors aren't prejudiced by the allowance of a stale claim—e.g, if the plan proposes to pay creditors a fixed percentage, or if it proposes to pay creditors in full, in which cases only the debtor is harmed and the trustee has no interest in objecting. Only the dissent cites the brief; Breyer has no response to it; Kannon Shanmugam's reply brief in support of the creditor wisely only cited it once and made no attempt to dispel its claims. It's hard to believe that Breyer and the majority truly thought that time-barred claims typically get caught in chapter 13 bankruptcies.
The third, and perhaps most compelling as far as Justice Breyer goes, is that Justice Breyer asked a whopping twenty-six questions at oral argument, none of which were about the likelihood of catching stale claims in chapter 13 bankruptcy, and almost all of which concerned the point he'll make next for the Court, to which I'll now turn.
Justice Breyer's real concern, and perhaps that of the Court as well, is that he doesn't want "an ordinary civil court . . . to determine answers to these bankruptcy-related questions," the premise being that FDCPA suits over bankruptcy claims on time-barred debts will go to "ordinary civil courts," i.e. district courts, and force them to decide some bankruptcy-related question or another. Other passages in the opinion warn of "postbankruptcy litigation in an ordinary civil court concerning a creditor's state of mind." This, I submit, is the nub of the Court's opinion.
Now, it's not at all clear what "bankruptcy-related questions" Justice Breyer thought "civil courts" would have to decide if FDCPA suits about bankruptcy claims were actionable. Whether a claim is stale or not is not a bankruptcy-law question, nor is whether the creditor knew whether the claim was stale (which matters under the FDCPA's bona fide error defense); they're questions of state law and FDCPA defenses, respectively.
In oral argument, however, Breyer speculated that permitting FDCPA suits on bankruptcy claims would make "the Article III judge -- maybe not in some cases, but in many cases -- deciding pretty complicated things as matters of bankruptcy law growing out of a bankruptcy case." The Chief Justice, similarly, worried about "things spinning out of the bankruptcy estate being adjudicated elsewhere" when "[t]he whole idea [of bankruptcy] is let's get everything here in one place and -- deal with it, you know." This line of questioning eventually devolved into Breyer's daring the debtor's counsel to "think of the most complicated [defense to a claim] you can think of and let's talk about that one," the notion being that debtors would bring FDCPA suits in district court alleging that a creditor should never have filed a claim because some especially complicated bankruptcy defense barred it. (Not a very plausible suggestion.) At this point, Justice Kagan (who would dissent) attempted to helpfully point out that there really aren't what she called "bankruptcy-related" defenses to claims brought in bankruptcy, just defenses under state law to those (typically) state-law contract or tort debts. It seems, however, that this intervention didn't have its intended effect, as the opinion that ultimately issued darkly warns in its most critical passages of "civil courts" deciding "bankruptcy-related questions."
D. What's wrong with all that.
This line of reasoning has two interesting features, the first being that on its own terms it's quite wrong, the second being that it's methodologically rather curious. The wrongness is of no methodological interest, other than perhaps underscoring the practical problems with a pragmatic approach to interpretation that considers all sorts of policy concerns no one's briefed, but if you read what follows instead of skipping to the methodology you'll learn something fun and odd about federal jurisdiction.
i. FDCPA claims about creditors' bankruptcy conduct wouldn't usually end up in "civil court."
On the first point, I happen to know a fair amount about bankruptcy jurisdiction, partly because I'm privileged to spend my spare time writing amicus briefs about it with the law professor who won the last two cases about it in the Supreme Court, and bankruptcy jurisdiction has a fascinating fillip that vests the bankruptcy courts with jurisdiction over FDCPA suits of this kind.
That is that bankruptcy courts, by reference of the district courts, are granted jurisdiction not only over bankruptcy cases, and suits arising under bankruptcy law, but "all civil proceedings . . . arising in or related to cases under title 11 [that is, bankruptcy cases]." Bracketing what "related to" has been interpreted to mean, which is rather strange and controversial, a proceeding "arising in" a bankruptcy is generally deemed to be a sort of dispute that factually arises, well, in a bankruptcy, and could only arise in bankruptcy—such as, the courts of appeals all agree, a suit against a bankruptcy attorney for malpractice (even though the cause of action exists outside of bankruptcy). Federal bankruptcy courts decide that kind of claim, surprisingly enough, even absent diversity or a federal question. (Embedded federal questions in malpractice suits typically don't make malpractice suits arise under federal law.)
Now, an FDCPA action about a creditor filing a claim in a bankruptcy on a time-barred debt is just that sort of a claim—a claim that, when described that way, arises in and can only arise in bankruptcy. Ergo, it "arises in" for jurisdictional purposes.* Ergo, if someone files an action of this kind in district court, complaining of something that happened in the bankruptcy case that remains on the bankruptcy court's docket, the district court is really supposed to kick it to the bankruptcy court under the standing reference order every district court has, under which it's referred everything within its bankruptcy jurisdiction (including all "arising in" matters) to its bankruptcy court, as Congress has authorized district courts to do. Of course, many FDCPA plaintiffs would sue in bankruptcy court in the first place because bankruptcy courts don't like it when creditors attempt to hoodwink their debtors in their court, but in any case, a creditor that didn't like the idea of a district court's adjudicating some "bankruptcy-related" matter in an FDCPA case could readily find its way back to bankruptcy court. (This would also have been, by the way, a great way to block the nationwide class certification Johnson sought, as it's generally thought that bankruptcy courts can only entertain district-wide class actions.) And if the case didn't raise the bankruptcy-related matters Justice Breyer fears these cases would, the creditor might otherwise prefer an Article III judge and wouldn't fight over the matter of the reference order.
* There may be some controversy over whether the bankruptcy court can
constitutionally enter a final judgment on the claim, rather than
proposed findings of fact and conclusions of law, if the creditor won't
consent, but this doesn't go to bankruptcy-court jurisdiction, just the degree of bankruptcy-court adjudicative authority.
ii. What question is the Court deciding?
The methodological point is that the Court got quite far afield from deciding whether filing a claim on a time-barred debt in a chapter 13 bankruptcy is "unfair" or "unconscionable"; the Court seems to have instead decided whether it's a good idea to let debtors sue their creditors in "civil court" for what they do in bankruptcy court, quite apart from how unfair or unconscionable the things those creditors do in bankruptcy court may be. How does the Court even attempt to describe this exercise in terms of interpretation?
The answer is, in the most purposivist/intentionalist way possible. Breyer says he cannot find, in the statute, "good reason to believe that Congress intended an ordinary civil court applying the Act to determine answers to these bankruptcy-related questions." Rather, he says, citing a purposes section of the FDCPA, the FDCPA "seeks to help consumers, not necessarily by closing . . . a loophole in the Bankruptcy Code, but by preventing consumer bankruptcies in the first place." That is, what justifies the Court's inquiry into whether it makes sense to let debtors sue their creditors for bankruptcy collection practices is a claim about whether Congress wanted it, no matter how textually "unfair" and "unconscionable" the practices may be. And yet, there is of course no evidence that Congress shared Justice Breyer's and the Court's concern about "civil courts" deciding "bankruptcy-related" FDCPA suits; what the Court is really engaged in, at best, is the echt-purposivist inquiry of what Congress would have written on the subject had it thought to specifically legislate on the subject. This is the sort of question that Hart and Sacks had courts asking themselves in the '60s, and that people like Judge Posner would still have courts ask today.
I have nothing very interesting to say about whether this mode of interpretation is okay, and won't say the obvious and hackneyed things that could be said. I'll instead confine myself to the two following observations. The first is that, triumphalist claims for textualism's success notwithstanding, this opinion of May 2017, from which only Justices Sotomayor, Ginsburg and Kagan dissented and in which Chief Justice Roberts and Justices Alito and Thomas joined, is not remotely textualist cricket. The dispositive reasons for which the Court decided the case don't even purport to be about the meaning of the critical language in the statute, but rather are all about whether Congress would have written a bankruptcy-claims carve-out from that language had it considered the matter for reasons that don't even pertain to the policies Congress was trying to advance. The unfairness of a merely stale claim versus a truly deceptive claim isn't what the opinion's about; the opinion's reasoning, if not quite its holding, applies to any bankruptcy claim, however unfair. A rather aggressive purposivism is alive today, not only in outliers like Judge Posner's opinion in Hively, but in majority opinions of the Supreme Court.
The second is that this kind of reasoning is more likely to be adopted when a statute's text says very little and seems to delegate a large measure of policy choice to courts. A court in the Court's situation is likely to feel not only that it's been delegated a decision to make about what collection practices are bad enough to be deemed "unfair or unconscionable," but that it's been delegated a decision to make about what collection practices should be actionable simpliciter. Even a textualist may so view the matter, and in any case with so little textual constraint bold purposive moves like Breyer's are more likely to slip by without textualist objection.
I think this is a mistake. Congress's intending, if it did so, courts to have broad discretion as to what counts as unfair doesn't entail that Congress intended courts to have broad discretion to except unfair practices from the statute's coverage for reasons unrelated to fairness. If Congress requires the Park Service to rid national parks of "big weeds," the agency has a great deal of discretion in defining "big," but I don't see that it can define out all weeds with thorns to cut on the cost of weeding gloves or save its employees cuts, nor even intentionally set "big" at a height that excludes all thorned weeds. A certain kind of statutory interpreter might disagree, especially with the latter claim, but here I just want to claim that the freewheling sort of discretion on display in Midland Funding isn't necessarily entailed by a broad delegation of discretion to the courts (or an agency). Rather, as we Chevronistas are always trying to assure our anti-Chevron friends, delegations are bounded things, not only by unambiguity on multiple sides (certain things are clearly unfair, other things are clearly not), but by the requirement that interpreters choose among permissible interpretations for reasons related to the reason for the rule they're interpreting, or sometimes other uncontroversially acceptable factors, like cost. Concerns, however valid, about "civil courts" deciding "bankruptcy-related" FDCPA claims have very little to do with the reasons for Congress banning unfair and unconscionable debt-collection practices, and seem better addressed to Congress than the courts.
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