Yes, the order to bring back the money violates the bankruptcy pause button. The law has a special rule that lets the government keep acting like a cop (enforcing rules) even during bankruptcy, but that special rule ends once the government gets a court to say 'this person owes you money.' After that point, trying to get the money is just debt collection, which is paused by bankruptcy. Forcing Brennan to bring the money back is a step toward collection, so it's not allowed. The government must go through the special bankruptcy court like everyone else.

No, the order should be allowed. The government wasn't trying to grab the money for itself; it wanted to put it in the court's hands so the bankruptcy judge could divide it fairly among everyone Brennan owed money to. This action was about stopping a bad guy from hiding and wasting money that should go to his victims. The majority's decision is too strict and lets a fraudster get away with hiding his assets.

Yes, the court's order breaks the bankruptcy rules. When someone is bankrupt, there are special rules that stop people from trying to collect money from them. The government usually gets to break these rules when it's enforcing laws, but not when it's just trying to collect money. Even though the SEC says it's not trying to collect money right now, that's basically what it's doing by asking for the hidden money to be brought back. This goes against the idea of giving the bankrupt person a break and letting the bankruptcy court handle all the money issues fairly.

No, the court's order doesn't break the rules. We should look at what the order actually does, not just what the SEC wants. The order doesn't give the SEC any money - it just brings the hidden money back so the bankruptcy court can deal with it fairly. This actually helps the bankruptcy process work better. It stops Brennan from using up the money that should go to the people he owes. The majority's decision makes it too hard for the government to stop people from hiding money when they're bankrupt.

Yes, the repatriation order violates the automatic stay provision. While an exception to the automatic stay exists for governmental units exercising their police or regulatory power, that exception does not apply to the enforcement of a money judgment. The court draws a bright line at the entry of a money judgment; any action taken thereafter to execute or collect upon that judgment is stayed. The SEC's Repatriation Order is an action taken after the entry of its 1995 money judgment and is plainly an effort to enforce it, regardless of the SEC's stated intention to preserve assets for all creditors. To permit such an action would undermine the Bankruptcy Code's policy of centralizing all disputes concerning the debtor's estate in the bankruptcy court and would allow the government to engage in forum shopping.

No, the repatriation order does not violate the automatic stay. The majority's bright-line rule prohibiting any action beyond the entry of a judgment is overly rigid and not required by precedent. The proper inquiry is whether the governmental action gives the government preferential treatment over other creditors. Here, the SEC's action sought to place the assets in the court's registry for the benefit of all creditors, subject to the bankruptcy court's ultimate distribution. This action prevents the dissipation of assets by a wrongdoer and aids, rather than subverts, the goals of bankruptcy by preserving the estate. The focus should be on the objective effect of the order, which benefits all creditors, not on the SEC's motive to ultimately collect on its judgment.

Yes. The repatriation order violates the automatic stay provision of the Bankruptcy Code. The order goes beyond the mere entry of a money judgment and constitutes an attempt to enforce such a judgment, which is explicitly prohibited by the exception to the governmental unit exception in § 362(b)(4). We hold this because the SEC is plainly seeking to satisfy at least part of its 1995 judgment from the assets of the Cardinal Trust. The fact that the SEC claims it is not seeking to collect the judgment now and only wants to preserve the assets for all potential claimants does not change this analysis. The policies behind the automatic stay, including granting relief to the debtor and preventing dissipation of assets before orderly distribution, weigh strongly in favor of applying the stay in these circumstances. Allowing the SEC to pursue the repatriation order in the district court would undermine these policies without furthering the policies behind the governmental unit exception.

No, because the repatriation order does not constitute the enforcement of a money judgment under § 362(b)(4) of the Bankruptcy Code. The crucial question in applying this section is whether the government's action enables it to enrich itself at the expense of non-governmental creditors. In this case, the SEC's action and the district court's order would bring the assets under the control of the bankruptcy court, preventing their dissipation and facilitating the central goal of the automatic stay. No non-governmental creditors would suffer harm as a result of the repatriation order. The majority's decision unduly restricts the government's exercise of regulatory authority where neither the language of the Code nor its underlying purposes require such a restriction.

Securities and Exchange Commission v. Robert E. Brennan

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