On May 6, the U.S. Court of Appeals for the First Circuit ruled that the U.S. Bankruptcy Code unequivocally strips tribes of their sovereign immunity, despite the fact that the provision at issue does not explicitly reference tribes.
In Coughlin v. Lac du Flambeau Band of Lake Superior Chippewa Indians, the court determined that a tribally owned lending entity, Niiwan LLC dba Lendgreen, was subject to the automatic stay under Chapter 13 of the Bankruptcy Code and therefore could not continue collection activities while the bankruptcy matter remained pending.
In finding unequivocal abrogation, however, the Coughlin court disregarded extensive case law that has consistently refused to abrogate tribal sovereign immunity without an explicit mention of tribes in the relevant statute.
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