(Slip Opinion) OCTOBER TERM, 2005 1
Syllabus
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
being done in connection with this case, at the time the opinion is issued.
The syllabus constitutes no part of the opinion of the Court but has been
prepared by the Reporter of Decisions for the convenience of the reader.
See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.
SUPREME COURT OF THE UNITED STATES
Syllabus
CENTRAL VIRGINIA COMMUNITY COLLEGE ET AL.
v. KATZ, LIQUIDATING SUPERVISOR FOR
WALLACE’S BOOKSTORES, INC.
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE SIXTH CIRCUIT
No. 04–885. Argued October 31, 2005—Decided January 23, 2006
The Bankruptcy Clause, Art. I, §8, cl. 4, empowers Congress to estab-
lish “uniform Laws on the subject of Bankruptcies throughout the
United States.” In Tennessee Student Assistance Corporation v. Hood,
541 U. S. 440, this Court, without reaching the question whether the
Clause gives Congress the authority to abrogate States’ immunity
from private suits, see id., at 443, upheld the application of the
Bankruptcy Code, 11 U. S. C. §101 et seq., to proceedings initiated by
a debtor against a state agency to determine the dischargeability of a
student loan debt, see 541 U. S., at 451. In this case, a proceeding
commenced by respondent Bankruptcy Trustee under §§547(b) and
550(a) to avoid and recover alleged preferential transfers by the
debtor to petitioner state agencies, the agencies claim that the pro-
ceeding is barred by sovereign immunity. The Bankruptcy Court de-
nied petitioners’ motions to dismiss on that ground, and the District
Court and the Sixth Circuit affirmed based on the Circuit’s prior de-
termination that Congress has abrogated the States’ sovereign im-
munity in bankruptcy proceedings.
Held: A bankruptcy trustee’s proceeding to set aside the debtor’s pref-
erential transfers to state agencies is not barred by sovereign immu-
nity. Pp. 3–22.
(a) The Bankruptcy Clause’s history, the reasons it was adopted,
and the legislation proposed and enacted under it immediately fol-
lowing ratification demonstrate that it was intended not just as a
grant of legislative authority to Congress, but also to authorize lim-
ited subordination of state sovereign immunity in the bankruptcy
2 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
Syllabus
arena. Although statements in Seminole Tribe of Fla. v. Florida, 517
U. S. 44, reflect an assumption that that case’s holding would apply
to the Clause, careful study and reflection convince this Court that
that assumption was erroneous. The Court is not bound to follow its
dicta in a prior case in which the point at issue was not fully debated.
Cohens v. Virginia, 6 Wheat. 264, 399–400. Pp. 4–5.
(b) States, whether or not they choose to participate, are bound by
a bankruptcy court’s order discharging the debtor no less than are
other creditors. Hood, 541 U. S., at 448. Petitioners here, like the
state agency parties in Hood, have conceded as much. See id., at 449.
The history of discharges in bankruptcy proceedings demonstrates
that these concessions, and Hood’s holding, are correct. The Framers’
primary goal in adopting the Clause was to prevent competing sover-
eigns’ interference with discharge: The patchwork of wildly divergent
and uncoordinated insolvency and bankruptcy laws that existed in
the American Colonies resulted in one jurisdiction’s imprisoning
debtors discharged (from prison and of their debts) in and by another
jurisdiction. The absence of extensive debate at the Convention over
the Clause’s text or its insertion into the Constitution indicates that
there was general agreement on the importance of authorizing a uni-
form federal response to the problems and injustice that system cre-
ated. Pp. 5–11.
(c) Bankruptcy jurisdiction, as understood today and at the fram-
ing, is principally in rem. See, e.g., Hood, 541 U. S., at 447. It thus
does not implicate States’ sovereignty to nearly the same degree as
other kinds of jurisdiction. See id., at 450–451. The Framers would
have understood the Bankruptcy Clause’s grant of power to enact
laws on the entire “subject of Bankruptcies” to include laws provid-
ing, in certain limited respects, for more than simple adjudications of
rights in the res. Courts adjudicating disputes concerning bankrupts’
estates historically have had the power to issue ancillary orders en-
forcing their in rem adjudications. See, e.g., id., at 455–456. The in-
terplay between in rem adjudications and orders ancillary thereto is
also evident in this case. Whether or not actions such as this are
properly characterized as in rem, those who crafted the Bankruptcy
Clause would have understood it to give Congress the power to au-
thorize courts to avoid preferential transfers and to recover the trans-
ferred property. Pp. 12–15.
(d) Insofar as orders ancillary to the bankruptcy courts’ in rem ju-
risdiction, like orders directing turnover of preferential transfers, im-
plicate States’ sovereign immunity from suit, the States agreed in the
plan of the Constitutional Convention not to assert that immunity.
That is evidenced not only by the Bankruptcy Clause’s history, but
also by legislation considered and enacted in the immediate wake of
Cite as: 546 U. S. ____ (2006) 3
Syllabus
the Constitution’s ratification. For example, the Bankruptcy Act of
1800 specifically granted federal courts habeas authority to release
debtors from state prisons at a time when state sovereign immunity
was preeminent among the Nation’s concerns, yet there appears to be
no record of any objection to that grant based on an infringement of
sovereign immunity. This history demonstrates that the power to
enact bankruptcy legislation was understood to carry with it the
power to subordinate state sovereignty, albeit within a limited
sphere. Pp. 15–21.
(e) The Court need not consider the question Hood left open:
whether Congress’ attempt to “abrogat[e]” state sovereign immunity
in 11 U. S. C. §106(a) is valid. The relevant question is not abroga-
tion, but whether Congress’ determination that States should be
amenable to preferential transfer proceedings is within the scope of
its power to enact “Laws on the subject of Bankruptcies.” Beyond
peradventure, it is. Congress’ power, at its option, either to treat
States in the same way as other creditors or exempt them from the
operation of bankruptcy laws arises from the Clause itself; the rele-
vant “abrogation” is the one effected in the plan of the Convention,
not by statute. Pp. 21–22.
106 Fed. Appx. 341, affirmed.
STEVENS, J., delivered the opinion of the Court, in which O’CONNOR,
SOUTER, GINSBURG, and BREYER, JJ., joined. THOMAS, J., filed a dissent-
ing opinion, in which ROBERTS, C. J., and SCALIA and KENNEDY, JJ.,
joined.
Cite as: 546 U. S. ____ (2006) 1
Opinion of the Court
NOTICE: This opinion is subject to formal revision before publication in the
preliminary print of the United States Reports. Readers are requested to
notify the Reporter of Decisions, Supreme Court of the United States, Wash-
ington, D. C. 20543, of any typographical or other formal errors, in order
that corrections may be made before the preliminary print goes to press.
SUPREME COURT OF THE UNITED STATES
_________________
No. 04–885
_________________
CENTRAL VIRGINIA COMMUNITY COLLEGE, ET AL.,
PETITIONERS v. BERNARD KATZ, LIQUIDATING
SUPERVISOR FOR WALLACE’S BOOKSTORES, INC.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE SIXTH CIRCUIT
[January 23, 2006]
JUSTICE STEVENS delivered the opinion of the Court.
Article I, §8, cl. 4, of the Constitution provides that
Congress shall have the power to establish “uniform Laws
on the subject of Bankruptcies throughout the United
States.” In Tennessee Student Assistance Corporation v.
Hood, 541 U. S. 440 (2004), we granted certiorari to deter-
mine whether this Clause gives Congress the authority to
abrogate States’ immunity from private suits. See id., at
443. Without reaching that question, we upheld the appli-
cation of the Bankruptcy Code to proceedings initiated by
a debtor against a state agency to determine the dis-
chargeability of a student loan debt. See id., at 451. In
this case we consider whether a proceeding initiated by a
bankruptcy trustee to set aside preferential transfers by
the debtor to state agencies is barred by sovereign immu-
nity. Relying in part on our reasoning in Hood, we reject
the sovereign immunity defense advanced by the state
agencies.
I
Petitioners are Virginia institutions of higher education
2 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
Opinion of the Court
that are considered “arm[s] of the State” entitled to sover-
eign immunity. See, e.g., Alden v. Maine, 527 U. S. 706,
756 (1999) (observing that only arms of the State can
assert the State’s immunity). Wallace’s Bookstores, Inc.,
did business with petitioners before it filed a petition for
relief under chapter 11 of the Bankruptcy Code, 11
U. S. C. §101 et seq. (2000 ed. and Supp. III), in the
United States Bankruptcy Court for the Eastern District
of Kentucky. Respondent, Bernard Katz, is the court-
appointed liquidating supervisor of the bankrupt estate.
He has commenced proceedings in the Bankruptcy Court
pursuant to §§547(b) and 550(a) to avoid and recover
alleged preferential transfers to each of the petitioners
made by the debtor when it was insolvent.1 Petitioners’
motions to dismiss those proceedings on the basis of sover-
eign immunity were denied by the Bankruptcy Court.
The denial was affirmed by the District Court and the
——————
1 A preferential transfer is defined as “any transfer of an interest of
the debtor in property—
“(1) to or for the benefit of a creditor;
“(2) for or on account of an antecedent debt owed by the debtor before
such transfer was made;
“(3) made while the debtor was insolvent;
“(4) made—
“(A) on or within 90 days before the date of the filing of the petition;
or
“(B) between ninety days and one year before the date of the filing of
the petition, if such creditor at the time of such transfer was an
insider; and
“(5) that enables such creditor to receive more than such creditor would
receive if—
“(A) the case were a case under chapter 7 of this title;
“(B) the transfer had not been made; and
“(C) such creditor received payment of such debt to the extent pro-
vided by the provisions of this title.” 11 U. S. C. §547(b).
Respondent also instituted adversary proceedings against some of the
petitioners to collect accounts receivable. He has, however, filed a
letter with this Court indicating his intent not to pursue those claims
further.
Cite as: 546 U. S. ____ (2006) 3
Opinion of the Court
Court of Appeals for the Sixth Circuit on the authority of
the Sixth Circuit’s prior determination that Congress has
abrogated the States’ sovereign immunity in bankruptcy
proceedings. See Hood v. Tennessee Student Assistance
Corporation (In re Hood), 319 F. 3d 755 (2003). We
granted certiorari, 544 U. S. ___ (2005), to consider the
question left open by our opinion in Hood: whether Con-
gress’ attempt to abrogate state sovereign immunity in 11
U. S. C. §106(a)2 is valid. As we shall explain, however,
——————
2 Section 106(a), as amended in 1994, provides in part as follows:
“Notwithstanding an assertion of sovereign immunity, sovereign
immunity is abrogated as to a governmental unit . . . with respect to the
following:
“(1) Sections 105, 106, 107, 108, 303, 346, 362, 363, 364, 365, 366,
502, 503, 505, 506, 510, 522, 523, 524, 525, 542, 543, 544, 545, 546, 547,
548, 549, 550, 551, 552, 553, 722, 724, 726, 728, 744, 749, 764, 901, 922,
926, 928, 929, 944, 1107, 1141, 1142, 1143, 1146, 1201, 1203, 1205,
1206, 1227, 1231, 1301, 1303, 1305, and 1327 of this title.
“(2) The court may hear and determine any issue arising with respect
to the application of such sections to governmental units.
“(3) The court may issue against a governmental unit an order, proc-
ess, or judgment under such sections of the Federal Rules of Bank-
ruptcy Procedure, including an order or judgment awarding a money
recovery, but not including an award of punitive damages. . . .”
The term “governmental unit” is defined to include a “State,” a
“municipality,” and a “department, agency, or instrumentality of . . . a
State.” §101(27).
The above-quoted version of §106(a) is the product of revisions made
in the wake of some of our precedents. The Bankruptcy Reform Act of
1978, 92 Stat. 2549, contained a provision indicating only that “gov-
ernmental unit[s],” defined to include States, were deemed to have
“waived sovereign immunity” with respect to certain proceedings in
bankruptcy and to be bound by a court’s determinations under certain
provisions of the Act “notwithstanding any assertion of sovereign
immunity.” Id., at 2555–2556. This Court’s decisions in Hoffman v.
Connecticut Dept. of Income Maintenance, 492 U. S. 96 (1989), and
United States v. Nordic Village, Inc., 503 U. S. 30 (1992), which held
that Congress had failed to make sufficiently clear in the predecessor to
§106(a) its intent either to “abrogate” state sovereign immunity or to
waive the Federal Government’s immunity, see 492 U. S., at 101; 503
U. S., at 39, prompted Congress in 1994 to enact the text of §106(a) now
4 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
Opinion of the Court
we are persuaded that the enactment of that provision
was not necessary to authorize the Bankruptcy Court’s
jurisdiction over these preference avoidance proceedings.
Bankruptcy jurisdiction, at its core, is in rem. See
Gardner v. New Jersey, 329 U. S. 565, 574 (1947) (“The
whole process of proof, allowance, and distribution is,
shortly speaking, an adjudication of interests claimed in a
res”). As we noted in Hood, it does not implicate States’
sovereignty to nearly the same degree as other kinds of
jurisdiction. See 541 U. S., at 450–451 (citing admiralty
and bankruptcy cases). That was as true in the 18th
century as it is today. Then, as now, the jurisdiction of
courts adjudicating rights in the bankrupt estate included
the power to issue compulsory orders to facilitate the
administration and distribution of the res.
It is appropriate to presume that the Framers of the
Constitution were familiar with the contemporary legal
context when they adopted the Bankruptcy Clause3—a
provision which, as we explain in Part IV, infra, reflects
the States’ acquiescence in a grant of congressional power
to subordinate to the pressing goal of harmonizing bank-
ruptcy law sovereign immunity defenses that might have
been asserted in bankruptcy proceedings. The history of
the Bankruptcy Clause, the reasons it was inserted in the
Constitution, and the legislation both proposed and en-
acted under its auspices immediately following ratification
——————
in force. See generally Gibson, Congressional Response to Hoffman and
Nordic Village: Amended Section 106 and Sovereign Immunity, 69 Am.
Bankr. L. J. 311 (1995).
3 In Cannon v. University of Chicago, 441 U. S. 677, 699 (1979), we
endorsed the presumption “that Congress was thoroughly familiar”
with contemporary law when it enacted Title IX of the Civil Rights Act
of 1964. It is equally proper to presume that the delegates to the
Constitutional Convention were fully aware of the potential for injus-
tice, discussed in Part II, infra, presented by the nonuniform state laws
authorizing imprisonment as a remedy for the nonpayment of an
insolvent’s debts.
Cite as: 546 U. S. ____ (2006) 5
Opinion of the Court
of the Constitution demonstrate that it was intended not
just as a grant of legislative authority to Congress, but
also to authorize limited subordination of state sovereign
immunity in the bankruptcy arena. Foremost on the
minds of those who adopted the Clause were the intracta-
ble problems, not to mention the injustice, created by one
State’s imprisoning of debtors who had been discharged
(from prison and of their debts) in and by another State.
As discussed below, to remedy this problem, the very first
Congresses considered, and the Sixth Congress enacted,
bankruptcy legislation authorizing federal courts to,
among other things, issue writs of habeas corpus directed
at state officials ordering the release of debtors from state
prisons.
We acknowledge that statements in both the majority
and the dissenting opinions in Seminole Tribe of Fla. v.
Florida, 517 U. S. 44 (1996), reflected an assumption that
the holding in that case would apply to the Bankruptcy
Clause. See also Hoffman v. Connecticut Dept. of Income
Maintenance, 492 U. S. 96, 105 (1989) (O’CONNOR, J.,
concurring). Careful study and reflection have convinced
us, however, that that assumption was erroneous. For
the reasons stated by Chief Justice Marshall in Cohens v.
Virginia, 6 Wheat. 264 (1821), we are not bound to follow
our dicta in a prior case in which the point now at issue
was not fully debated. See id., at 399–400 (“It is a maxim
not to be disregarded, that general expressions, in every
opinion, are to be taken in connection with the case in
which those expressions are used. If they go beyond the
case, they may be respected, but ought not to control the
judgment in a subsequent suit when the very point is
presented for decision”).
II
Critical features of every bankruptcy proceeding are the
6 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
Opinion of the Court
exercise of exclusive jurisdiction over all of the debtor’s
property, the equitable distribution of that property
among the debtor’s creditors, and the ultimate discharge
that gives the debtor a “fresh start” by releasing him, her,
or it from further liability for old debts. See, e.g., Local
Loan Co. v. Hunt, 292 U. S. 234, 244 (1934). “Under our
longstanding precedent, States, whether or not they
choose to participate in the proceeding, are bound by a
bankruptcy court’s discharge order no less than other
creditors.” Hood, 541 U. S., at 448. Petitioners here, like
the state agencies that were parties in Hood, have con-
ceded as much. See id., at 449 (noting concession that
“States are generally bound by a bankruptcy court’s dis-
charge order”); Tr. of Oral Arg. 8–9 (Oct. 31, 2005).
The history of discharges in bankruptcy proceedings
demonstrates that the state agencies’ concessions, and
Hood’s holding, are correct. The term “discharge” histori-
cally had a dual meaning; it referred to both release of
debts and release of the debtor from prison. Indeed, the
earliest English statutes governing bankruptcy and insol-
vency authorized discharges of persons, not debts. One
statute enacted in 1649 was entitled “An act for discharg-
ing Poor Prisoners unable to satisfy their creditors.” See 2
Acts and Ordinances of the Interregnum, 1642–1660, pp.
240–241 (C. Firth & R. Rait eds. 1911). The stated pur-
pose of the Act was to “Discharge . . . the person of [the]
Debtor” “of and from his or her Imprisonment.” Ibid. Not
until 1705 did the English Parliament extend the dis-
charge (and then only for traders and merchants) to in-
clude release of debts. See 4 Ann., ch. 17, §7 (providing
that upon compliance with the statute, “all and every
person and persons so becoming bankrupt . . . shall be
discharged from all debts by him, her, or them due and
owing at the time that he, she, or they did become bank-
rupt”); see also McCoid, Discharge: The Most Important
Development in Bankruptcy History, 70 Am. Bankr. L. J.
Cite as: 546 U. S. ____ (2006) 7
Opinion of the Court
163, 167 (1996).
Well into the 18th century, imprisonment for debt was
still ubiquitous in England4 and the American Colonies.
Bankruptcy and insolvency laws remained as much con-
cerned with ensuring full satisfaction of creditors (and,
relatedly, preventing debtors’ flight to parts unknown5) as
with securing new beginnings for debtors. Illustrative of
bankruptcy laws’ harsh treatment of debtors during this
period was that debtors often fared worse than common
criminals in prison; unfortunate insolvents, unlike crimi-
nals, were forced to provide their own food, fuel, and cloth-
ing while behind bars. See B. Mann, Republic of Debtors:
Bankruptcy in the Age of American Independence 78–108
(2002).
Common as imprisonment itself was, the American
Colonies, and later the several States, had wildly diver-
gent schemes for discharging debtors and their debts. Id.,
at 79 (“The only consistency among debt laws in the eight-
eenth century was that every colony, and later every state,
permitted imprisonment for debt—most on mesne process,
and all on execution of a judgment”). At least four juris-
dictions offered relief through private Acts of their legisla-
tures. See Railway Labor Executives’ Assn. v. Gibbons,
455 U. S. 457, 472 (1982). Those Acts released debtors
from prison upon surrender of their property, and many
coupled the release from prison with a discharge of debts.
Other jurisdictions enacted general laws providing for
——————
4 Imprisonment for debt was not abolished in England until 1869, and
then only subject to certain exceptions. See Debtors Act, 1869, 32 & 33
Vict., ch. 62, §4; see also Cohen, The History of Imprisonment for Debt
and its Relation to the Development of Discharge in Bankruptcy, 3 J.
Leg. Hist. 153, 164 (1982).
5 The legislation widely acknowledged to be the first English bank-
ruptcy statute, 34 & 35 Hen. 8, ch. 4, §1 (1542), contained a provision
explaining that the statute was needed to deal with the growing num-
ber of debtors who, after “craftily obtaining into their Hands great
Substance of other Men’s Goods, do suddenly flee to Parts unknown.”
8 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
Opinion of the Court
release from prison and, in a few places, discharge of debt.
Others still granted release from prison, but only in ex-
change for indentured servitude. Some jurisdictions pro-
vided no relief at all for the debtor. See generally P. Cole-
man, Debtors and Creditors in America: Insolvency,
Imprisonment for Debt, and Bankruptcy, 1607–1900
(1999).6
The difficulties posed by this patchwork of insolvency
and bankruptcy laws were peculiar to the American ex-
perience. In England, where there was only one sovereign,
a single discharge could protect the debtor from his jailer
and his creditors. As two cases—one litigated before the
Constitutional Convention in Philadelphia and one liti-
gated after it—demonstrate, however, the uncoordinated
actions of multiple sovereigns, each laying claim to the
debtor’s body and effects according to different rules,
rendered impossible so neat a solution on this side of the
Atlantic.
In the first case, James v. Allen, 1 Dall. 188 (C. P. Phila.
Cty. 1786), Jared Ingersoll, an attorney who a year later
would become a delegate to the Philadelphia Convention,7
——————
6 “At the time of the Revolution, only three of the thirteen colo-
nies . . . had laws discharging insolvents of their debts. No two of these
relief systems were alike in anything but spirit. In four of the other ten
colonies, insolvency legislation was either never enacted or, if enacted,
never went into effect, and in the remaining six colonies, full relief was
available only for scattered, brief periods, usually on an ad hoc basis to
named insolvents.” Coleman, Debtors and Creditors in America, at 14.
7 Ingersoll was admitted to the Philadelphia bar in 1773 and elected a
member of the Continental Congress in 1780. After serving as a
delegate to the Constitutional Convention, he became a member of the
Philadelphia Common Council. He served as attorney general of
Pennsylvania from 1790 to 1799 and again from 1811 to 1817. From
March 1821 until his death in 1822 he served as a judge in the District
Court for the City and County of Philadelphia. Among the cases he
litigated before this Court was Chisholm v. Georgia, 2 Dall. 419
(1793)—for the State of Georgia, see ibid. See also 9 Dictionary of
American Biography 468–469 (1932).
Cite as: 546 U. S. ____ (2006) 9
Opinion of the Court
represented a Pennsylvania creditor seeking recovery from
a debtor who had been released from prison in New Jer-
sey. Shortly after his release, the debtor traveled to Penn-
sylvania, where he was arrested for nonpayment of the
Pennsylvania debt. In seeking release from the Pennsyl-
vania prison, he argued that his debt had been discharged
by the New Jersey court. Ingersoll responded that the
order granting relief under New Jersey’s insolvency laws
“only discharged the person of the debtor from arrest
within the State of New Jersey.” Id., at 190. The court
agreed: Whatever effect the order might have had in New
Jersey, the court said, it “goes no further than to discharge
[the debtor] from his imprisonment in the Gaol of Essex
County in the State of New Jersey; which, if the fullest
obedience were paid to it, could not authorize a subse-
quent discharge from imprisonment in another Gaol, in
another State.” Id., at 192. The court further observed
that “[i]nsolvent laws subsist in every State in the Union,
and are probably all different from each other . . . . Even
the Bankrupt Laws of England, while we were the sub-
jects of that country, were never supposed to extend here,
so as to exempt the persons of the Bankrupts from being
arrested.” Id., at 191.
In the second case, Millar v. Hall, 1 Dall. 229 (Pa. 1788),
which was decided the year after the Philadelphia Con-
vention, Ingersoll found himself arguing against the prin-
ciple announced in James. His client, a debtor named
Hall, had been “discharged under an insolvent law of the
state of Maryland, which is in the nature of a general
bankrupt[cy] law.” 1 Dall., at 231. Prior to his discharge,
Hall had incurred a debt to a Pennsylvanian named Mil-
lar. Hall neglected to mention that debt in his schedule of
creditors presented to the Maryland court, or to personally
notify Millar of the looming discharge. Following the
Maryland court’s order, Hall traveled to Pennsylvania and
was promptly arrested for the unpaid debt to Millar.
10 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
Opinion of the Court
Responding to Millar’s counsel’s argument that the
holding of James controlled, Ingersoll urged adoption of a
rule that “the discharge of the Defendant in one state
ought to be sufficient to discharge [a debtor] in every
state.” 1 Dall., at 231. Absent such a rule, Ingersoll con-
tinued, “perpetual imprisonment must be the lot of every
man who fails; and all hope of retrieving his losses by
honest and industrious pursuits, will be cut off from the
unfortunate bankrupt.” Ibid. The court accepted this
argument. Allowing a creditor to execute “upon [a
debtor’s] person out of the state in which he has been
discharged,” the court explained, “would be giving a supe-
riority to some creditors, and affording them a double
satisfaction—to wit, a proportionable dividend of his prop-
erty there, and the imprisonment of his person here.” Id.,
at 232. Indeed, the debtor having already been obliged to
surrender all of his effects, “to permit the taking [of] his
person here, would be to attempt to compel him to perform
an impossibility, that is, to pay a debt after he has been
deprived of every means of payment,—an attempt which
would, at least, amount to perpetual imprisonment, unless
the benevolence of his friends should interfere to discharge
[his] account.” Ibid.
These two cases illustrate the backdrop against which
the Bankruptcy Clause was adopted. In both James and
Millar, the debtors argued that the earlier discharge
should be given preclusive effect pursuant to the Full
Faith and Credit Clause of the Articles of Confederation.
See James, 1 Dall., at 190; Millar, 1 Dall., at 231. That
possibility was the subject of discussion at the Constitu-
tional Convention when a proposal to encompass legisla-
tive Acts, and insolvency laws in particular, within the
coverage of the Full Faith and Credit Clause of the Consti-
tution was committed to the Committee of Detail8 together
——————
8 The Committee of Detail was created by the Convention on July 25,
Cite as: 546 U. S. ____ (2006) 11
Opinion of the Court
with a proposal “ ‘[t]o establish uniform laws upon the
subject of bankruptcies, and respecting the damages aris-
ing on the protest of foreign bills of exchange.’ ” See
Nadelmann, On the Origin of the Bankruptcy Clause, 1
Am. J. Legal Hist. 215, 216–217, 219 (1957); see also
Plank, The Constitutional Limits of Bankruptcy, 63 Tenn.
L. Rev. 487, 527–528 (1996). A few days after this pro-
posal was taken under advisement, the Committee of
Detail reported that it had recommended adding the
power “ ‘[t]o establish uniform laws upon the subject of
bankruptcies’ ” to the Naturalization Clause of what later
became Article I.
The Convention adopted the Committee’s recommenda-
tion with very little debate two days later. Roger Sherman
of Connecticut alone voted against it, apparently because
he was concerned that it would authorize Congress to
impose upon American citizens the ultimate penalty for
debt then in effect in England: death. See J. Madison,
Notes of Debates in the Federal Convention of 1787, p. 571
(Ohio Univ. Press ed. 1966). The absence of extensive
debate over the text of the Bankruptcy Clause or its inser-
tion indicates that there was general agreement on the
importance of authorizing a uniform federal response to
the problems presented in cases like James and Millar.9
——————
1787, to prepare a draft text of the Constitution based on delegates’
proposals.
9 Of course, the Bankruptcy Clause, located as it is in Article I, is
“ ‘intimately connected’ ” not just with the Full Faith and Credit Clause,
which appears in Article IV of the Constitution, but also with the
Commerce Clause. See Railway Labor Executives’ Assn. v. Gibbons,
455 U. S. 457, 466 (1982) (quoting The Federalist No. 42, p. 285 (N. Y.
Heritage Press 1945)). That does not mean, however, that the state
sovereign immunity implications of the Bankruptcy Clause necessarily
mirror those of the Commerce Clause. Indeed, the Bankruptcy Clause’s
unique history, combined with the singular nature of bankruptcy
courts’ jurisdiction, discussed infra, have persuaded us that the ratifi-
cation of the Bankruptcy Clause does represent a surrender by the
12 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
Opinion of the Court
III
Bankruptcy jurisdiction, as understood today and at the
time of the framing, is principally in rem jurisdiction. See
Hood, 541 U. S., at 447; Local Loan Co., 292 U. S., at 241;
Straton v. New, 283 U. S. 318, 320–321 (1931); Hanover
Nat. Bank v. Moyses, 186 U. S. 181, 192 (1902); New Lamp
Chimney Co. v. Ansonia Brass & Copper Co., 91 U. S. 656,
661–662 (1876). In bankruptcy, “the court’s jurisdiction is
premised on the debtor and his estate, and not on the
creditors.” Hood, 541 U. S., at 447. As such, its exercise
does not, in the usual case, interfere with state sover-
eignty even when States’ interests are affected. See id., at
448.
The text of Article I, §8, cl. 4, of the Constitution, how-
ever, provides that Congress shall have the power to
establish “uniform Laws on the subject of Bankruptcies
throughout the United States.” Although the interest in
avoiding unjust imprisonment for debt and making federal
discharges in bankruptcy enforceable in every State was a
primary motivation for the adoption of that provision, its
coverage encompasses the entire “subject of Bankrupt-
cies.” The power granted to Congress by that Clause is a
unitary concept rather than an amalgam of discrete
segments.
The Framers would have understood that laws “on the
subject of Bankruptcies” included laws providing, in cer-
tain limited respects, for more than simple adjudications
of rights in the res. The first bankruptcy statute, for
example, gave bankruptcy commissioners appointed by
the district court the power, inter alia, to imprison recalci-
trant third parties in possession of the estate’s assets. See
Bankruptcy Act of 1800, §14, 2 Stat. 25 (repealed 1803).
——————
States of their sovereign immunity in certain federal proceedings. That
conclusion is implicit in our holding in Tennessee Student Assistance
Corporation v. Hood, 541 U. S. 440 (2004).
Cite as: 546 U. S. ____ (2006) 13
Opinion of the Court
More generally, courts adjudicating disputes concerning
bankrupts’ estates historically have had the power to issue
ancillary orders enforcing their in rem adjudications. See,
e.g., 2 W. Blackstone, Commentaries on the Laws of Eng-
land 486 (1766) (noting that the assignees of the bank-
rupt’s property—the 18th-century counterparts to today’s
bankruptcy trustees—could “pursue any legal method of
recovering [the debtor’s] property so vested in them,” and
could pursue methods in equity with the consent of the
creditors); Plank, 63 Tenn. L. Rev., at 523 (discussing
State insolvency and bankruptcy laws in the 18th century
empowering courts to recover preferential transfers); see
also Ex parte Christy, 3 How. 292, 312, 314 (1844) (Story,
J.) (describing bankruptcy jurisdiction under the 1841 Act
in broad terms); Wright v. Union Central Life Ins. Co., 304
U. S. 502, 513–514 (1938) (defining “bankruptcy” as the
“ ‘subject of the relations between an insolvent or nonpay-
ing or fraudulent debtor and his creditors, extending to his
and their relief’ ” (emphasis added)).
Our decision in Hood illustrates the point. As the dis-
senters in that case pointed out, it was at least arguable
that the particular procedure that the debtor pursued to
establish dischargeability of her student loan could have
been characterized as a suit against the State rather than
a purely in rem proceeding. See 541 U. S., at 455–456
(THOMAS, J., dissenting). But because the proceeding was
merely ancillary to the Bankruptcy Court’s exercise of its
in rem jurisdiction, we held that it did not implicate state
sovereign immunity. The point is also illustrated by Con-
gress’ early grant to federal courts of the power to issue in
personam writs of habeas corpus directing States to re-
lease debtors from state prisons, discussed in Part IV,
infra. See Braden v. 30th Judicial Circuit Court of Ky.,
410 U. S. 484, 494–495 (1973) (“The writ of habeas corpus
does not act upon the prisoner who seeks relief, but upon
the person who holds him in what is alleged to be unlawful
14 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
Opinion of the Court
custody”).
The interplay between in rem adjudications and orders
ancillary thereto is evident in the case before us. Respon-
dent first seeks a determination under 11 U. S. C. §547
that the various transfers made by the debtor to petition-
ers qualify as voidable preferences. The §547 determina-
tion, standing alone, operates as a mere declaration of
avoidance. That declaration may be all that the trustee
wants; for example, if the State has a claim against the
bankrupt estate, the avoidance determination operates to
bar that claim until the preference is turned over. See
§502(d). In some cases, though, the trustee, in order to
marshal the entirety of the debtor’s estate, will need to
recover the subject of the transfer pursuant to §550(a). A
court order mandating turnover of the property, although
ancillary to and in furtherance of the court’s in rem juris-
diction, might itself involve in personam process.
As we explain in Part IV, infra, it is not necessary to
decide whether actions to recover preferential transfers
pursuant to §550(a) are themselves properly characterized
as in rem.10 Whatever the appropriate appellation, those
——————
10 The proper characterization of such actions is not as clear as peti-
tioners suggest. The Court in Nordic Village, Inc., 503 U. S., at 38,
stated, as an alternative basis for rejecting a bankruptcy trustee’s
argument that a suit to avoid a preferential transfer made to the
Internal Revenue Service was an action in rem, that any in rem “excep-
tion” to sovereign immunity was unavailable in that case because the
trustee sought to recover a “sum of money, not ‘particular dollars.’ ”
There was, in the Court’s view, “no res to which the [bankruptcy]
court’s in rem jurisdiction could have attached.” Ibid. In making that
determination, the Court distinguished our earlier decision in United
States v. Whiting Pools, Inc., 462 U. S. 198 (1983), which held that the
debtor’s “estate,” the res, “includes property of the debtor that has been
seized by a creditor prior to the filing of a [bankruptcy] petition.” Id., at
209; see also Begier v. IRS, 496 U. S. 53, 58 (1990) (“ ‘property of the
debtor’ subject to the preferential transfer provision is best understood
as that property that would have been part of the estate had it not been
transferred before the commencement of bankruptcy proceedings”). We
Cite as: 546 U. S. ____ (2006) 15
Opinion of the Court
who crafted the Bankruptcy Clause would have under-
stood it to give Congress the power to authorize courts to
avoid preferential transfers and to recover the transferred
property. Petitioners do not dispute that that authority
has been a core aspect of the administration of bankrupt
estates since at least the 18th century. See, e.g., Rust v.
Cooper, 2 Cowp. 629, 633–634, 98 Eng. Rep. 1277, 1280
(K. B. 1777); Alderson v. Temple, 1 Black. W. 660, 661–
663, 96 Eng. Rep. 384, 385 (K. B. 1768); see also McCoid,
Bankruptcy, Preferences, and Efficiency: An Expression of
Doubt, 67 Va. L. Rev. 249, 251–253 (1981) (discussing
English precedents, dating back to Sir Edward Coke’s
discussion in The Case of Bankrupts, 2 Co. Rep. 25a, 76
Eng. Rep. 441 (K. B. 1589), addressing bankruptcy com-
missioners’ power to avoid preferences); In re Dehon, Inc.,
327 B. R. 38, 62–65 (Bkrtcy. Ct. Mass. 2005) (collecting
historical materials). And it, like the authority to issue
writs of habeas corpus releasing debtors from state pris-
ons, see Part IV, infra, operates free and clear of the
State’s claim of sovereign immunity.
IV
Insofar as orders ancillary to the bankruptcy courts’ in
rem jurisdiction, like orders directing turnover of preferen-
tial transfers, implicate States’ sovereign immunity from
suit, the States agreed in the plan of the Convention not to
assert that immunity. So much is evidenced not only by
the history of the Bankruptcy Clause, which shows that
the Framers’ primary goal was to prevent competing
sovereigns’ interference with the debtor’s discharge, see
——————
observe that the trustee in this case, unlike the one in Nordic Village,
seeks, in the alternative, both return of the “value” of the preference,
see 11 U. S. C. §550(a), and return of the actual “property transferred,”
ibid. See Brief for Respondent 37 (“Respondent invokes the in rem
jurisdiction of the bankruptcy court to recover under section 550 ‘the
property transferred’ ”).
16 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
Opinion of the Court
Part II, supra, but also by legislation considered and
enacted in the immediate wake of the Constitution’s
ratification.
Congress considered proposed legislation establishing
uniform federal bankruptcy laws in the first and each
succeeding Congress until 1800, when the first Bank-
ruptcy Act was passed. See C. Warren, Bankruptcy in
United States History 10 (1935) (“[I]n the very first ses-
sion of the 1st Congress, during which only the most nec-
essary subjects of legislation were considered, bankruptcy
was one of those subjects; and as early as June 1, 1789, a
Committee of the House was named to prepare a bank-
ruptcy bill”). The Bankruptcy Act of 1800 was in many
respects a copy of the English bankruptcy statute then in
force. It was, like the English law, chiefly a measure
designed to benefit creditors. Like the English statute, its
principal provisions permitted bankruptcy commissioners,
on appointment by a federal district court, to arrest the
debtor, see §4, 2 Stat. 22; to “cause the doors of the dwell-
ing-house of [the] bankrupt to be broken,” §4, id., at 23–
24; to seize and collect the debtor’s assets, §5, id., at 23; to
examine the debtor and any individuals who might have
possession of the debtor’s property, §§14, 18, 19, id., at 25–
27; and to issue a “certificate of discharge” once the estate
had been distributed, §36, id., at 31.
The American legislation differed slightly from the
English, however. That difference reflects both the
uniqueness of a system involving multiple sovereigns and
the concerns that lay at the core of the Bankruptcy Clause
itself. The English statute gave a judge sitting on a court
where the debtor had obtained his discharge the power to
order a sheriff, “Bailiff or Officer, Gaoler or Keeper of any
Prison” to release the “Bankrupt out of Custody” if he were
arrested subsequent to the discharge. 5 Geo. 2, ch. 30, ¶13
(1732). The American version of this provision was
worded differently; it specifically granted federal courts
Cite as: 546 U. S. ____ (2006) 17
Opinion of the Court
the authority to issue writs of habeas corpus effective to
release debtors from state prisons. See §38, 2 Stat. 32; see
also In re Comstock, 6 F. Cas. 237, 239 (No. 3,073) (Vt.
1842) (observing that Bankruptcy Act of 1800, then re-
pealed, would have granted a federal court the power to
issue a writ of habeas corpus to release a debtor from state
prison if he had been arrested following his bankruptcy
discharge).
This grant of habeas power is remarkable not least
because it would be another 67 years, after ratification of
the Fourteenth Amendment, before the writ would be
made generally available to state prisoners. See Ex parte
Royall, 117 U. S. 241, 247 (1886).11 Moreover, the provi-
sion of the 1800 Act granting that power was considered
and adopted during a period when state sovereign immu-
nity could hardly have been more prominent among the
Nation’s concerns. Chisholm v. Georgia, 2 Dall. 419, the
case that had so “shock[ed]” the country in its lack of
regard for state sovereign immunity, Principality of
Monaco v. Mississippi, 292 U. S. 313, 325 (1934), was
decided in 1793. The ensuing five years that culminated
in adoption of the Eleventh Amendment were rife with
discussion of States’ sovereignty and their amenability to
——————
11 The Judiciary Act of 1789 authorized issuance of the writ, but only
to release those held in federal custody. See Haines, The Uniformity
Power: Why Bankruptcy is Different, 77 Am. Bankr. L. J. 129, 179–181
(2003) (hereinafter Haines). Also, in the interim between 1800 and
1867, Congress authorized limited issuance of the writ in response to
two crises it viewed as sufficiently pressing to warrant a federal re-
sponse: The South Carolina nullification controversy of 1828–1833 and
the imprisonment of a foreign national by New York State a few years
later. See 4 Stat. 632 (1833); 5 Stat. 539 (1842); see also W. Duker, A
Constitutional History of Habeas Corpus 187–189 (1980). The 1833
statute made the writ available to U. S. citizens imprisoned by States
for actions authorized by federal law, while the 1842 statute gave
federal judges the power to release foreign nationals imprisoned for
actions authorized by foreign governments.
18 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
Opinion of the Court
suit. Yet there appears to be no record of any objection to
the bankruptcy legislation or its grant of habeas power to
federal courts based on an infringement of sovereign
immunity. See Haines 184–185.
This history strongly supports the view that the Bank-
ruptcy Clause of Article I, the source of Congress’ author-
ity to effect this intrusion upon state sovereignty, simply
did not contravene the norms this Court has understood
the Eleventh Amendment to exemplify. Cf. Blatchford v.
Native Village of Noatak, 501 U. S. 775, 779 (1991) (“[W]e
have understood the Eleventh Amendment to stand not so
much for what it says, but for the presupposition of our
constitutional structure which it confirms . . .”).12 Peti-
tioners, ignoring this history, contend that nothing in the
words of the Bankruptcy Clause evinces an intent on the
part of the Framers to alter the “background principle” of
state sovereign immunity. Seminole Tribe of Fla., 517
U. S., at 72. Specifically, they deny that the word “uni-
——————
12 Further evidence of the Framers’ intent to exempt laws “on the
subject of Bankruptcies” from the operation of state sovereign immu-
nity principles can be gleaned from §62 of the Bankruptcy Act of 1800.
That section provided that “nothing contained in this law shall, in any
manner, affect the right of preference to prior satisfaction of debts due
to the United States as secured or provided by any law heretofore
passed, nor shall be construed to lessen or impair any right to, or
security for, money due to the United States or to any of them.” 2 Stat.
36. That Congress felt the need to carve out an exception for States’
preferences undermines any suggestion that it was operating against a
background presumption of state sovereign immunity to bankruptcy
laws. Indeed, one contemporary commentator read this section of the
Act as requiring that the protected “priorit[ies]” would have to be
“specifically given by some act of the Legislature of the Union” before
they would be exempt from operation of the Act’s provisions. See T.
Cooper, The Bankrupt Law of America, Compared with the Bankrupt
Law of England 334 (1801) (reprint 1992) (“But I do not apprehend
[that] this extends to give any priority to the United States, not specifi-
cally given by some act of the Legislature of the Union; nor will the
English doctrine of priorities in favour of the crown be extended by
analogy into this country”).
Cite as: 546 U. S. ____ (2006) 19
Opinion of the Court
form” in the Clause implies anything about pre-existing
immunities or Congress’ power to interfere with those
immunities. See Brief for Petitioners 32–42. Whatever
the merits of petitioners’ argument,13 it misses the point;
——————
13 Petitioners make much of precedents suggesting that the word
“uniform” represents a limitation, rather than an expansion, of Con-
gress’ legislative power in the bankruptcy sphere. See, e.g., Gibbons,
455 U. S., at 468 (“Unlike the Commerce Clause, the Bankruptcy
Clause itself contains an affirmative limitation or restriction upon
Congress’ power: bankruptcy laws must be uniform throughout the
United States”). They also cite Justice Frankfurter’s concurring opin-
ion in Vanston Bondholders Protective Comm. v. Green, 329 U. S. 156
(1946), for the proposition that “[t]he Constitutional requirement of
uniformity is a requirement of geographic uniformity,” id., at 172.
Based on these authorities, petitioners argue that the word “uniform”
in the Bankruptcy Clause cannot be interpreted to confer upon Con-
gress any greater authority to impinge upon state sovereign immunity
than is conferred, for example, by the Commerce Clause. See Brief for
Petitioners 33.
Petitioners’ logic is not persuasive. Although our analysis does not
rest on the peculiar text of the Bankruptcy Clause as compared to other
Clauses of Article I, we observe that, if anything, the mandate to enact
“uniform” laws supports the historical evidence showing that the States
agreed not to assert their sovereign immunity in proceedings brought
pursuant to “Laws on the subject of Bankruptcies.” That Congress is
constrained to enact laws that are uniform in application, whether
geographically or otherwise, cf. Gibbons, 455 U. S., at 470 (invalidating
a bankruptcy law aimed at “one regional bankrupt railroad” and no one
else), does not imply that it lacks power to enact bankruptcy legislation
that is uniform in a more robust sense. See Haines 158–172. As our
holding today demonstrates, Congress has the power to enact bank-
ruptcy laws the purpose and effect of which are to ensure uniformity in
treatment of state and private creditors. See Sturges v. Crowninshield,
4 Wheat. 122, 193–194 (1819) (Marshall, C. J.) (“The peculiar terms of
the grant certainly deserve notice. Congress is not authorized merely
to pass laws, the operation of which shall be uniform, but to establish
uniform laws on the subject throughout the United States”); see also
In re Dehon, Inc., 327 B. R. 38, 57–58 (Bkrtcy. Ct. Mass. 2005) (discuss-
ing Lathrop v. Drake, 91 U. S. 516 (1876)); The Federalist Nos. 32 and
81, pp. 197–201, 481–491 (C. Rossiter ed. 1961) (A. Hamilton) (pointing
to the “uniform[ity]” language of the Naturalization Clause, which
appears in the same clause of Article I as the bankruptcy provision, as
20 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
Opinion of the Court
text aside, the Framers, in adopting the Bankruptcy
Clause, plainly intended to give Congress the power to
redress the rampant injustice resulting from States’ re-
fusal to respect one another’s discharge orders. As dem-
onstrated by the First Congress’ immediate consideration
and the Sixth Congress’ enactment of a provision granting
federal courts the authority to release debtors from state
prisons, the power to enact bankruptcy legislation was
understood to carry with it the power to subordinate state
sovereignty, albeit within a limited sphere.
The ineluctable conclusion, then, is that States agreed
in the plan of the Convention not to assert any sovereign
immunity defense they might have had in proceedings
brought pursuant to “Laws on the subject of Bankrupt-
cies.” See Blatchford, 501 U. S., at 779 (observing that a
State is not “subject to suit in federal court unless it has
consented to suit, either expressly or in the ‘plan of the
convention’ ”); Alden v. Maine, 527 U. S., at 713 (same).14
The scope of this consent was limited; the jurisdiction
exercised in bankruptcy proceedings was chiefly in rem—a
narrow jurisdiction that does not implicate state sover-
eignty to nearly the same degree as other kinds of jurisdic-
——————
an example of an instance where the Framers contemplated a “surren-
der of [States’] immunity in the plan of the convention”).
14 One might object that the writ of habeas corpus was no infringe-
ment on state sovereignty, and would not have been understood as
such, because that writ, being in the nature of an injunction against a
state official, does not commence or constitute a suit against the State.
See Ex parte Young, 209 U. S. 123, 159–160 (1908). While that objec-
tion would be supported by precedent today, it would not have been
apparent to the Framers. The Ex parte Young doctrine was not finally
settled until over a century after the Framing and the enactment of the
first bankruptcy statute. Indeed, we have recently characterized the
doctrine as an expedient “fiction” necessary to ensure the supremacy of
federal law. See Pennhurst State School and Hospital v. Halderman,
465 U. S. 89, 114, n. 25 (1984); see also Idaho v. Coeur d’Alene Tribe of
Idaho, 521 U. S. 261, 281 (1997).
Cite as: 546 U. S. ____ (2006) 21
Opinion of the Court
tion. But while the principal focus of the bankruptcy
proceedings is and was always the res, some exercises of
bankruptcy courts’ powers—issuance of writs of habeas
corpus included—unquestionably involved more than mere
adjudication of rights in a res. In ratifying the Bank-
ruptcy Clause, the States acquiesced in a subordination of
whatever sovereign immunity they might otherwise have
asserted in proceedings necessary to effectuate the in rem
jurisdiction of the bankruptcy courts.15
V
Neither our decision in Hood, which held that States
could not assert sovereign immunity as a defense in ad-
versary proceedings brought to adjudicate the discharge-
ability of student loans, nor the cases upon which it relied,
see 541 U. S., at 448–449 (discussing New York v. Irving
Trust Co., 288 U. S. 329 (1933); Gardner, 329 U. S. 565;
and Van Huffel v. Harkelrode, 284 U. S. 225 (1931)),
rested on any statement Congress had made on the sub-
ject of state sovereign immunity. Nor does our decision
today. The relevant question is not whether Congress has
“abrogated” States’ immunity in proceedings to recover
preferential transfers. See 11 U. S. C. §106(a).16 The
question, rather, is whether Congress’ determination that
States should be amenable to such proceedings is within
the scope of its power to enact “Laws on the subject of
Bankruptcies.” We think it beyond peradventure that it
is.
Congress may, at its option, either treat States in the
same way as other creditors insofar as concerns “Laws on
——————
15 We do not mean to suggest that every law labeled a “bankruptcy”
law could, consistent with the Bankruptcy Clause, properly impinge
upon state sovereign immunity.
16 Cf. Hoffman, 492 U. S., at 101 (holding that, in an earlier version of
11 U. S. C. §106, Congress had failed to make sufficiently clear its
intent to abrogate state sovereign immunity).
22 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
Opinion of the Court
the subject of Bankruptcies” or exempt them from opera-
tion of such laws. Its power to do so arises from the Bank-
ruptcy Clause itself; the relevant “abrogation” is the one
effected in the plan of the Convention, not by statute.
The judgment of the Court of Appeals for the Sixth
Circuit is affirmed.
It is so ordered.
Cite as: 546 U. S. ____ (2006) 1
THOMAS, J., dissenting
SUPREME COURT OF THE UNITED STATES
_________________
No. 04–885
_________________
CENTRAL VIRGINIA COMMUNITY COLLEGE, ET AL.,
PETITIONERS v. BERNARD KATZ, LIQUIDATING
SUPERVISOR FOR WALLACE’S BOOKSTORES, INC.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE SIXTH CIRCUIT
[January 23, 2006]
JUSTICE THOMAS, with whom THE CHIEF JUSTICE,
JUSTICE SCALIA, and JUSTICE KENNEDY join, dissenting.
Under our Constitution, the States are not subject to
suit by private parties for monetary relief absent their
consent or a valid congressional abrogation, and it is
“settled doctrine” that nothing in Article I of the Constitu-
tion establishes those preconditions. Alden v. Maine, 527
U. S. 706, 748 (1999). Yet the majority today casts aside
these long-established principles to hold that the States
are subject to suit by a rather unlikely class of individu-
als—bankruptcy trustees seeking recovery of preferential
transfers for a bankrupt debtor’s estate. This conclusion
cannot be justified by the text, structure, or history of our
Constitution. In addition, today’s ruling is not only impos-
sible to square with this Court’s settled state sovereign
immunity jurisprudence; it is also impossible to reach
without overruling this Court’s judgment in Hoffman v.
Connecticut Dept. of Income Maintenance, 492 U. S. 96
(1989).
The majority maintains that the States’ consent to suit
can be ascertained from the history of the Bankruptcy
Clause. But history confirms that the adoption of the
Constitution merely established federal power to legislate
in the area of bankruptcy law, and did not manifest an
2 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
THOMAS, J., dissenting
additional intention to waive the States’ sovereign immu-
nity against suit. Accordingly, I respectfully dissent.
I
The majority does not appear to question the estab-
lished framework for examining the question of state
sovereign immunity under our Constitution. The Framers
understood, and this Court reiterated over a century ago
in Hans v. Louisiana, 134 U. S. 1 (1890), that
“ ‘It is inherent in the nature of sovereignty not to be
amenable to the suit of an individual without its con-
sent. This is the general sense and the general prac-
tice of mankind; and the exemption, as one of the at-
tributes of sovereignty, is now enjoyed by the
government of every state in the Union. Unless, there-
fore, there is a surrender of this immunity in the plan
of the convention, it will remain with the states . . . .’ ”
Id., at 13 (quoting The Federalist No. 81, pp. 548-549 (J.
Cooke ed. 1961)) (emphasis added and deleted) (hereinaf-
ter The Federalist No. 81). See also Ex parte New York,
256 U. S. 490, 497 (1921) (“That a State may not be sued
without its consent is a fundamental rule of jurisprudence
having so important a bearing upon the construction of the
Constitution of the United States that it has become es-
tablished by repeated decisions of this court that the
entire judicial power granted by the Constitution does not
embrace authority to entertain a suit brought by private
parties against a State without consent given”); Seminole
Tribe of Fla. v. Florida, 517 U. S. 44, 54 (1996).
These principles were further reinforced early in our
Nation’s history, when the people swiftly rejected this
Court’s decision in Chisholm v. Georgia, 2 Dall. 419
(1793), by ratifying the Eleventh Amendment less than
two years later. See Hans, supra, at 11; Reid v. Covert,
Cite as: 546 U. S. ____ (2006) 3
THOMAS, J., dissenting
354 U. S. 1, 14, n. 27 (1957). Thus, “[f]or over a century
[since Hans] we have reaffirmed that federal jurisdiction
over suits against unconsenting States ‘was not contem-
plated by the Constitution when establishing the judicial
power of the United States.’ ” Seminole Tribe, supra, at 54
(quoting Hans, supra, at 15); see also Seminole Tribe,
supra, at 54–55, n. 7 (collecting cases).
The majority finds a surrender of the States’ immunity
from suit in Article I of the Constitution, which authorizes
Congress “[t]o establish . . . uniform Laws on the subject of
Bankruptcies throughout the United States.” §8, cl. 4.
But nothing in the text of the Bankruptcy Clause suggests
an abrogation or limitation of the States’ sovereign immu-
nity. Indeed, as this Court has noted on numerous occa-
sions, “[t]he Eleventh Amendment restricts the judicial
power under Article III, and Article I cannot be used to
circumvent the constitutional limitations placed upon
federal jurisdiction.” Seminole Tribe, supra, at 72–73.
“[I]t is settled doctrine that neither substantive federal
law nor attempted congressional abrogation under Article
I bars a State from raising a constitutional defense of
sovereign immunity in federal court.” Alden, supra, at
748. See also Kimel v. Florida Bd. of Regents, 528 U. S.
62, 80 (2000); Board of Trustees of Univ. of Ala. v. Garrett,
531 U. S. 356, 364 (2001). And we have specifically ap-
plied this “settled doctrine” to bar abrogation of state
sovereign immunity under various clauses within §8 of
Article I. See, e.g., Seminole Tribe, supra, at 44 (the Inter-
state and Indian Commerce Clauses); Florida Prepaid
Postsecondary Ed. Expense Bd. v. College Savings Bank,
527 U. S. 627 (1999) (the Patents Clause).
It is difficult to discern an intention to abrogate state
sovereign immunity through the Bankruptcy Clause when
no such intention has been found in any of the other
clauses in Article I. Indeed, our cases are replete with
acknowledgments that there is nothing special about the
4 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
THOMAS, J., dissenting
Bankruptcy Clause in this regard. See Seminole Tribe,
517 U. S., at 72–73, n. 16; see also id., at 93–94 (STEVENS,
J., dissenting) (“In confronting the question whether a
federal grant of jurisdiction is within the scope of Article
III, as limited by the Eleventh Amendment, I see no rea-
son to distinguish among statutes enacted pursuant to the
power granted to Congress to regulate commerce among
the several States, and with the Indian tribes, the power
to establish uniform laws on the subject of bankruptcy,
[or] the power to promote the progress of science and the
arts by granting exclusive rights to authors and inventors”
(citations omitted)); id., at 77–78, and n. 1 (STEVENS, J.,
dissenting); Hoffman, 492 U. S., at 105 (SCALIA, J., con-
curring in judgment). Today’s decision thus cannot be
reconciled with our established sovereign immunity juris-
prudence, which the majority does not purport to overturn.
The majority’s departure from this Court’s precedents is
not limited to this general framework, however; the major-
ity also overrules sub silentio this Court’s holding in
Hoffman, supra. The petitioner in Hoffman, id., at 99—
like respondent Katz here—sought to pursue a preference
avoidance action against a state agency pursuant to 11
U. S. C. §547(b). The plurality opinion, joined by four
Members of this Court, held that Eleventh Amendment
immunity barred suit because Congress had failed to enact
legislation sufficient to abrogate that immunity, and
expressed no view on whether Congress possessed the
constitutional power to do so. Hoffman, supra, at 104.
JUSTICE SCALIA concurred in the judgment, arguing that
there was no need to examine the statute because the
Bankruptcy Clause does not empower Congress to enact
legislation abrogating state sovereign immunity. See id.,
at 105; see also ibid. (O’CONNOR, J., concurring) (“I agree
with JUSTICE SCALIA that Congress may not abrogate the
States’ Eleventh Amendment immunity by enacting a
statute under the Bankruptcy Clause”). Thus, a majority
Cite as: 546 U. S. ____ (2006) 5
THOMAS, J., dissenting
of the Court in Hoffman agreed: (1) that a preference
action in bankruptcy against a state agency is barred by
sovereign immunity; and (2) that, at a minimum (and
absent the State’s consent), overcoming that immunity
would require a clearer statutory abrogation than Con-
gress had provided.1
After today’s decision, however, Hoffman can no longer
stand. For today’s decision makes clear that no action of
Congress is needed because the Bankruptcy Clause itself
manifests the consent of the States to be sued. Ante, at 21.
II
The majority supports its break from precedent by
relying on historical evidence that purportedly reveals the
Framers’ intent to eliminate state sovereign immunity in
bankruptcy proceedings. Ante, at 4, 15. The Framers
undoubtedly wanted to give Congress the authority to
enact a national law of bankruptcy, as the text of the
Bankruptcy Clause confirms. But the majority goes fur-
ther, contending that the Framers found it intolerable that
bankruptcy laws could vary from State to State, and de-
manded the enactment of a single, uniform national body
of bankruptcy law. Ante, at 7–10. The majority then
concludes that, to achieve a uniform national bankruptcy
law, the Framers must have intended to waive the States’
sovereign immunity against suit. Ante, at 4. Both claims
are unwarranted.
A
In contending that the States waived their immunity
from suit by adopting the Bankruptcy Clause, the majority
conflates two distinct attributes of sovereignty: the author-
ity of a sovereign to enact legislation regulating its own
——————
1 The parties in Hoffman likewise agreed that the suit was barred by
Eleventh Amendment immunity absent some further action by Con-
gress. 492 U. S., at 101.
6 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
THOMAS, J., dissenting
citizens, and sovereign immunity against suit by private
citizens.2 Nothing in the history of the Bankruptcy Clause
suggests that, by including that clause in Article I, the
founding generation intended to waive the latter aspect of
sovereignty. These two attributes of sovereignty often do
not run together—and for purposes of enacting a uniform
law of bankruptcy, they need not run together.
For example, Article I also empowers Congress to regu-
late interstate commerce and to protect copyrights and
patents. These provisions, no less than the Bankruptcy
Clause, were motivated by the Framers’ desire for nation-
ally uniform legislation. See James Madison, Preface to
Debates in the Convention of 1787, reprinted in 3 M.
Farrand, Records of the Federal Convention of 1787, pp.
539, 547–548 (1911) (hereinafter Farrand’s Debates)
(noting lack of national regulation of commerce and uni-
form bankruptcy law as defects under the Articles of
Confederation); M. Farrand, The Framing of the Constitu-
tion of the United States 48 (1913) (noting that the Arti-
cles of Confederation failed to provide for uniform national
regulation of naturalization, bankruptcy, copyrights, and
patents). Thus, we have recognized that “[t]he need for
uniformity in the construction of patent law is undoubt-
edly important.” Florida Prepaid, 527 U. S., at 645.
Nonetheless, we have refused, in addressing patent law, to
give the need for uniformity the weight the majority today
assigns it in the context of bankruptcy, instead recogniz-
ing that this need “is a factor which belongs to the Article
I patent-power calculus, rather than to any determination
of whether a state plea of sovereign immunity deprives a
——————
2 Immunity against suit is just “one of the attributes of sovereignty,
. . . enjoyed by the government of every state in the Union.” The
Federalist No. 81, at 549. The sovereign power to legislate is a distinct
attribute of sovereignty; it is discussed, for example, in a completely
separate portion of the Federalist than immunity from suit. See, e.g.,
id., No. 32.
Cite as: 546 U. S. ____ (2006) 7
THOMAS, J., dissenting
patentee of property without due process of law.” Ibid.
Nor is the abrogation of state sovereign immunity from
suit necessary to the enactment of nationally uniform
bankruptcy laws. The sovereign immunity of the States
against suit does not undermine the objective of a uniform
national law of bankruptcy, any more than does any dif-
ferential treatment between different categories of credi-
tors. Cf. Railway Labor Executives’ Assn. v. Gibbons, 455
U. S. 457, 469 (1982) (“The uniformity requirement is not
a straightjacket that forbids Congress to distinguish
among classes of debtors, nor does it prohibit Congress
from recognizing that state laws do not treat commercial
transactions in a uniform manner”).
B
The majority also greatly exaggerates the depth of the
Framers’ fervor to enact a national bankruptcy regime.
The idea of authorizing Congress to enact a nationally
uniform bankruptcy law did not arise until late in the
Constitutional Convention, which began in earnest on
May 25, 1787. 1 Farrand’s Debates xi. The Convention
charged the Committee of Detail with putting forth a
comprehensive draft Constitution, which it did on August
6. Ibid.; 2 id., at 177. Yet the Convention did not consider
the language that eventually became the Bankruptcy
Clause until September 1, id., at 483–485, and it adopted
the provision with little debate two days later, id., at 489.
Under the majority’s analysis, which emphasizes the
Framers’ zeal to enact a national law of bankruptcy, this
timing is difficult to explain.
The majority’s premise fares even worse in explaining
the postratification period. The majority correctly notes
that the practice of the early Congresses can provide
valuable insight into the Framers’ understanding of the
Constitution. Ante, at 15. But early practice undermines,
rather than supports, the majority’s theory. “For over a
8 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
THOMAS, J., dissenting
century after the Constitution, . . . the Bankruptcy Clause
[authority] remained largely unexercised by Congress. . . .
Thus, states were free to act in bankruptcy matters for all
but 16 of the first 109 years after the Constitution was
ratified.” Tabb, The History of the Bankruptcy Laws in
the United States, 3 Am. Bankr. Inst. L. Rev. 5, 13–14
(1995). And when Congress did act, it did so only in re-
sponse to a major financial disaster, and it repealed the
legislation in each instance shortly thereafter. Id., at 14-
21.3 It was not until 1898, well over a century after the
adoption of the Bankruptcy Clause, that Congress adopted
the first permanent national bankruptcy law. 30 Stat.
544.
The historical record thus refutes, rather than supports,
the majority’s premise that the Framers placed paramount
importance on the enactment of a nationally uniform
bankruptcy law. In reality, for most of the first century of
our Nation’s history, the country survived without such a
——————
3 For
over a dozen years after the ratification of the Constitution,
Congress failed to adopt a single bankruptcy law. See, e.g., 9 Annals of
Congress 2671 (1799) (noting that Congress had “not . . . passed [bank-
ruptcy legislation] for these ten years past, and the States [have]
legislated upon it in their own way” (statement of Rep. Baldwin)); 3
Farrand’s Debates 380 (same)). It was not until April 4, 1800, that the
Sixth Congress finally adopted our Nation’s first bankruptcy law, ch.
19, 2 Stat. 19, and even that law left an ample role for state law, id.,
§61, at 36. (By contrast, the very first Congress enacted, inter alia,
patent and copyright legislation. 1 Stat. 109, 124.)
Moreover, that first Act was short-lived; Congress repealed it just
three years later. 2 Stat. 248. And over a decade later, this Court
confirmed what Congress’ inattention had already communicated—that
the Bankruptcy Clause does not vest exclusive power in Congress, but
instead leaves an ample role for the States. See Sturges v. Crownin-
shield, 4 Wheat. 122 (1819). It was not until 1841 that Congress would
enact another bankruptcy law, ch. 9, 5 Stat. 440, only to repeal it less
than two years later, ch. 82, 5 id., at 614. The economic upheaval of the
Civil War caused Congress to pass another bankruptcy law in 1867, ch.
176, 14 Stat. 517, but that too was repealed after just over a decade, ch.
160, 20 Stat. 99.
Cite as: 546 U. S. ____ (2006) 9
THOMAS, J., dissenting
law, relying instead on the laws of the several States.
Moreover, the majority identifies no historical evidence
suggesting that the Framers or the early legislatures, even
if they were anxious to establish a national bankruptcy
law, contemplated that the States would subject them-
selves to private suit as creditors under that law. In fact,
the historical record establishes that the Framers’ held the
opposite view. To the Framers, it was a particularly grave
offense to a State’s sovereignty to be hauled into court by a
private citizen and forced to make payments on debts.
Alexander Hamilton, the author of Federalist No. 81,
followed his general discussion of state sovereign immu-
nity by emphasizing that the Constitution would be espe-
cially solicitous of state sovereignty within the specific
context of payment of state debts:
“ ‘[T]here is no color to pretend that the state govern-
ments would, by the adoption of that plan, be divested
of the privilege of paying their own debts in their own
way, free from every constraint but that which flows
from the obligations of good faith. The contracts be-
tween a nation and individuals are only binding on
the conscience of the sovereign, and have no preten-
sion to a compulsive force. They confer no right of ac-
tion independent of the sovereign will. To what pur-
pose would it be to authorize suits against States for
the debts they owe? How could recoveries be en-
forced? It is evident that it could not be done without
waging war against the contracting State; and to as-
cribe to the federal courts by mere implication, and in
destruction of a pre-existing right of the state gov-
ernments, a power which would involve such a conse-
quence, would be altogether forced and unwarrant-
able.’ ” Hans, 134 U. S., at 13 (quoting The Federalist
No. 81, at 549).
10 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
THOMAS, J., dissenting
C
The majority attempts to bolster its historical argument
by making three additional observations about the bank-
ruptcy power: (1) Congress’ early provision of habeas
corpus relief in bankruptcy to forbid the imprisonment of a
debtor by one State, in violation of a discharge order is-
sued by the courts of another State, ante, at 6–7, 16–17;
(2) the inability of debtors, first in the American Colonies
and then under the Articles of Confederation, to enforce in
one state court a discharge order issued by another state
court, ante, at 7–11; and (3) the historical understanding
that bankruptcy jurisdiction is principally in rem, ante, at
11–15. The implication is that, if these specific observa-
tions about bankruptcy are correct, then States must
necessarily be subject to suit in transfer recovery proceed-
ings, if not also in other bankruptcy settings. Ante, at 12;
ante, at 19–20. But none of these observations comes close
to demonstrating that, under the Bankruptcy Clause, the
States may be sued by private parties for monetary relief.4
1
The availability of habeas relief in bankruptcy between
1800 and 1803 does not support respondent’s effort to
obtain monetary relief in bankruptcy against state agen-
cies today.5 The habeas writ was well established by the
——————
4 To be sure, the majority opinion adds, in a footnote, that “[w]e do not
mean to suggest that every law labeled a ‘bankruptcy’ law could,
consistent with the Bankruptcy Clause, properly impinge upon state
sovereign immunity.” Ante, at 20, n. 15. But the majority offers no
explanation of this statement; certainly it offers no principled basis on
which to draw distinctions in future cases.
5 This is particularly so given the absence of any known application of
that law (let alone any test of its validity) during that time. The
provision was enacted into law on April 4, 1800, ch. 19, 2 Stat. 19, and
repealed on December 19, 1803, ch. 6, 2 id., at 248. The sole reference
cited by the majority is In re Comstock, 6 F. Cas. 237 (No. 3,073) (Vt.
1842), see ante, at 16–17, but that ruling, issued nearly 40 years after
Cite as: 546 U. S. ____ (2006) 11
THOMAS, J., dissenting
time of the Framing, and consistent with then-prevailing
notions of sovereignty. In Ex parte Young, 209 U. S. 123
(1908), this Court held that a petition for the writ is a suit
against a state official, not a suit against a State, and thus
does not offend the Eleventh Amendment:
“The right to so discharge has not been doubted by
this court, and it has never been supposed there was
any suit against the state by reason of serving the
writ upon one of the officers of the state in whose cus-
tody the person was found. In some of the cases the
writ has been refused as matter of discretion; but in
others it has been granted, while the power has been
fully recognized in all.” Id., at 168 (collecting cases).
This Court has reaffirmed Young repeatedly—including
in Seminole Tribe, 517 U. S., at 71, n. 14. Although the
majority observes that Young was not issued “until over a
century after the Framing and the enactment of the first
bankruptcy statute,” ante, at 20, n. 14, this observation
does nothing to reconcile the majority’s analysis with
Young, as the majority does not purport to question the
historical underpinnings of Young’s holding. The avail-
ability of federal habeas relief to debtors in state prisons
thus has no bearing whatsoever on whether the Bank-
ruptcy Clause authorizes suits against the States for
money damages.6
——————
the 1800 Act’s repeal, merely noted in dicta the prior existence of the
habeas provision.
6 The majority also contends that the provision for habeas relief in the
1800 bankruptcy law is “remarkable not least because it would be
another 67 years, after ratification of the Fourteenth Amendment,
before the writ would be made generally available to state prisoners.”
Ante, at 17. The implication is that the Bankruptcy Clause shares a
similar pedigree with the Fourteenth Amendment, which (unlike
Article I of the Constitution) authorizes Congress to abrogate state
sovereign immunity against suit. See, e.g., Fitzpatrick v. Bitzer, 427
12 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
THOMAS, J., dissenting
2
The majority’s second observation—that the Framers
were concerned that, under the Articles of Confederation,
debtors were unable to obtain discharge orders issued by
the court of one State that would be binding in the court of
another State, ante, at 7–11—implicates nothing more
than the application of full faith and credit, as is apparent
from the majority opinion itself. Accordingly, it has noth-
ing to do with state sovereign immunity from suit.
To support its observation, the majority describes at
length two Pennsylvania court rulings issued under the
Articles of Confederation. See James v. Allen, 1 Dall. 188
(C. P. Phila. Cty. 1786); Millar v. Hall, 1 Dall. 229 (Pa.
1788). But as the majority’s explanation makes clear, the
problem demonstrated by these cases is the need for rec-
ognition of sister-state judgments by state courts, not
disregard for state sovereign immunity against suit in
federal courts. Both James and Millar involved litigation
between a private debtor and a private creditor. In both
cases, the creditor filed suit in a Pennsylvania court to
enforce a debt. And in both cases, the debtor sought but
failed to obtain recognition of a judgment of discharge that
had previously been entered by a court of another State.
Ante, at 10.
Accordingly, it is unsurprising that, when the issue of
bankruptcy arose at the Constitutional Convention, it was
——————
U. S. 445 (1976). But as the majority recognizes, ante, at 17, n. 11,
Congress did enact other habeas provisions prior to the Fourteenth
Amendment. See 4 Stat. 632; 5 Stat. 539; see generally W. Duker, A
Constitutional History of Habeas Corpus 187–189 (1980) (discussing
the 1833 and 1842 Acts). The Fourteenth Amendment bears no rele-
vance to this discussion in any event, because as I have explained
above, habeas relief simply does not offend the Framers’ view of state
sovereign immunity. See also Young, 209 U. S., at 150 (“[A] decision of
this case does not require an examination or decision of the question
whether [the] adoption [of the Fourteenth Amendment] in any way
altered or limited the effect of the [Eleventh] Amendment”).
Cite as: 546 U. S. ____ (2006) 13
THOMAS, J., dissenting
also within the context of full faith and credit. See ante, at
10–11.7 As the majority correctly points out, the Framers
“plainly intended to give Congress the power to redress
the rampant injustice resulting from States’ refusal to
respect one another’s discharge orders.” Ante, at 19. But
redress of that “rampant injustice” turned entirely on
binding state courts to respect the discharge orders of
their sister States under the Full Faith and Credit Clause,
not on the authorization of private suits against the
States.
3
Finally, the majority observes that the bankruptcy
power is principally exercised through in rem jurisdiction.
Ante, at 11–15. The fact that certain aspects of the bank-
ruptcy power may be characterized as in rem, however,
does not determine whether or not the States enjoy sover-
eign immunity against such in rem suits. And it certainly
does not answer the question presented in this case:
whether the Bankruptcy Clause subjects the States to
transfer recovery proceedings—proceedings the majority
describes as “ancillary to and in furtherance of the court’s
in rem jurisdiction,” though not necessarily themselves in
rem, ante, at 14.
Two years ago, this Court held that a State is bound by
a bankruptcy court’s discharge order, notwithstanding the
——————
7 The same point was made in Railway Labor Executives’ Assn. v.
Gibbons, 455 U. S. 457 (1982): “Prior to the drafting of the Constitution,
at least four States followed the practice of passing private Acts to
relieve individual debtors. Given the sovereign status of the States,
questions were raised as to whether one State had to recognize the
relief given to a debtor by another State [citing James and Millar].
Uniformity among state debtor insolvency laws was an impossibility
and the practice of passing private bankruptcy laws was subject to
abuse if the legislators were less than honest. Thus, it is not surprising
that the Bankruptcy Clause was introduced during discussion of the
Full Faith and Credit Clause.” Id., at 472 (citations omitted).
14 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
THOMAS, J., dissenting
State’s invocation of sovereign immunity, because such
actions arise out of in rem jurisdiction. See Tennessee
Student Assistance Corporation v. Hood, 541 U. S. 440,
448 (2004). In doing so, however, the Court explicitly
distinguished recovery of preferential transfers, noting
that the debt discharge proceedings there were “unlike an
adversary proceeding by the bankruptcy trustee seeking to
recover property in the hands of the State on the grounds
that the transfer was a voidable preference.” Id., at 454.
The fact that transfer recovery proceedings fall outside
any possible in rem exception to sovereign immunity is
confirmed by United States v. Nordic Village, Inc., 503
U. S. 30 (1992), which involved similar facts. There, the
Bankruptcy Trustee filed a transfer avoidance action
against the United States, in order to recover a recent
payment the debtor had made to the Internal Revenue
Service on a tax debt. See id., at 31. After determining
that the United States had not waived its sovereign im-
munity, the Court rejected the trustee’s alternative argu-
ment based on in rem jurisdiction. As the Court ex-
plained, “[r]espondent sought to recover a sum of money,
not ‘particular dollars,’ so there was no res to which the
court’s in rem jurisdiction could have attached.” Id., at 38
(quoting Begier v. IRS, 496 U. S. 53, 62 (1990) (internal
citations omitted and emphasis deleted)).8
——————
8 Begier involved funds held by the debtor in statutory trust for the
United States—so its analysis of those “particular dollars” does not
help the respondent in this case. 496 U. S., at 62 (emphasis deleted).
Nor does United States v. Whiting Pools, Inc., 462 U. S. 198 (1983),
support the majority’s effort. In Whiting Pools, the United States
waived its immunity by filing suit. See id., at 200–01; see also Nordic
Village, 503 U. S., at 39 (“The Court’s opinion in Whiting Pools contains
no discussion of §106(c) [the waiver provision]”). Furthermore, in
Whiting Pools the Government possessed merely a secured interest in
the property on the basis of a tax lien, see 462 U. S., at 202. By con-
trast, here, as in Nordic Village, it is uncontested that the State owns
the funds, barring any subsequent transfer by operation of bankruptcy
Cite as: 546 U. S. ____ (2006) 15
THOMAS, J., dissenting
The majority attempts to evade Nordic Village by claim-
ing that “the trustee in this case, unlike the one in Nordic
Village, seeks, in the alternative, both return of the ‘value’
of the preference, and return of the actual ‘property trans-
ferred.’ ” Ante, at 14, n. 10 (quoting 11 U. S. C. §550(a)).
But where, as here, the property in question is money,
there is no practical distinction between these two options,
and surely we did not reach the result in Nordic Village
because of an accident of pleading. Moreover, it is hardly
clear that the trustee in Nordic Village failed to ask for a
“return” of the “ ‘property transferred,’ ” ante, at 14, n. 10,
and the majority does not cite anything to support its
assertion. See also Nordic Village, supra, at 31 (“[T]he
trustee . . . commenced an adversary proceeding . . . seek-
ing to recover, among other transfers, the $20,000 paid . . .
to the IRS”); In re Nordic Village, Inc., 915 F. 2d 1049,
1051 (CA6 1990) (“The trustee subsequently initiated a
proceeding to recover several unauthorized post-petition
transfers, including the transfer to the IRS”).
In light of the weakness of its historical evidence that
the States consented to be sued in bankruptcy proceed-
ings, the majority’s effort to recast respondent’s action as
in rem is understandable, but unconvincing.
* * *
It would be one thing if the majority simply wanted to
overrule Seminole Tribe altogether. That would be wrong,
but at least the terms of our disagreement would be trans-
parent. The majority’s action today, by contrast, is diffi-
cult to comprehend. Nothing in the text, structure, or
history of the Constitution indicates that the Bankruptcy
Clause, in contrast to all of the other provisions of Article
——————
law. See 503 U. S., at 39 (“A suit for payment of funds from the Treas-
ury is quite different from a suit for the return of tangible property in
which the debtor retained ownership”).
16 CENTRAL VA. COMMUNITY COLLEGE v. KATZ
THOMAS, J., dissenting
I, manifests the States’ consent to be sued by private
citizens.
I respectfully dissent.