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Chrysler on Vacation

posted by Stephen Lubben

Chrysler Many have speculated, in both the comments to my post yesterday and on other blogs, about the editorial significance of the Supreme Court's vacatur of the 2d Circuit's Chrysler opinion -- the most common reading being that the Court intended to signal that Chrysler was somehow unique. But this seems to miss that just one week ago the Court did the exact same thing in a non-bankruptcy case (08-351) involving Illinois seizure proceedings. In that opinion, the Court vacated the 7th Circuit's opinion after the last of the underlying cases settled after cert. was granted, but before oral argument at the Supreme Court.


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My wonderment was not so much at the vacatur as the decision the case was moot. Wasn't the case in the same procedural posture as when the Second Circuit issued its decision? If the parties had done something to cause mootness to occur, then the Court's decision in Bonner Mall would indicate that vacatur should not have been ordered.

Actually, Alvarez et al v. Smith et al seems to indicate that the Supreme Court's intention by vacating the Circuit Court opinion was to push the matter back to the Bankruptcy Court.

Specifically, the Court held in Alvarez "In moot cases, this Court normally vacates the lower court judgment, which clears the path for relitigation of the issues and preserves the rights of the parties, while prejudicing none by a preliminary decision. United States v. Munsingwear, Inc., 340 U. S. 36, 40."

Does that mean that SCOTUS is encouraging Indiana to petition the bankruptcy court?

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