Failure to Challenge Case Dismissal Renders Credit Counseling Appeal Moot

By Alexander Beeby posted 22 days ago

  
BANKRUPTCY BULLETIN
Contributing Editor: Nauni J. MantyManty & Associates, P.A.

In In re Musel, 630 B.R. 794 (Bankr. D. Minn. July 7, 2021) (Ridgway, C.J.), the bankruptcy court denied a trustee’s motion for turnover of tribal gaming revenue payments after holding that tribal law applies and provides that the debtor has no vested property rights in the payments.

The debtor is a member of a tribal nation that enacted a Gaming Revenue Allocation Plan, pursuant to the Federal Indian Gaming Regulatory Act of 1988, under which the debtor and other citizens of that tribal nation receive apportioned monthly payments of the nation’s net gaming revenues. The trustee sought turnover of these payments, arguing that the payments equated to a right to distributions from a business entity. The debtor objected, pointing to the language of the allocation plan, which explicitly provides that the plan does not provide any vested property right or interest in the gaming revenues.

After acknowledging a lack of case law precedence or guidance on the issue, the court discussed the range of approaches taken by various court, from (1) considering the right to payments as property of the estate to (2) considering the payments of inconsequential value to the estate to (3) considering the payments themselves as property and the interest as contingent and, focusing on tribal sovereignty, the payments as not property of the estate. The court then discussed the relationship between federal and state law in determining what constitutes property of the estate and ultimately held that tribal law applies to tribal gaming revenues because congress did not provide that state law should supersede tribal sovereignty as to those revenues. The court went on to discuss the wider policy, logic, and equity the court considered to support this conclusion, including discussion of the historical context relating to tribal sovereignty.

Co-Editors in Chief
Alexander J. Beeby, Larkin Hoffman
Kesha Tanabe, Tanabe Law

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