From Fictionalism to Functionalism in State Sovereign Immunity: The Bankruptcy Discharge as Statutory Ex parte Young Relief After Hood

Research output: Contribution to journalArticlepeer-review


In Tennessee Student Assistance Corp. v. Hood, the Supreme Court resolved an issue of tremendous significance to the functional efficacy of federal bankruptcy relief, holding that states have no constitutional sovereign immunity in dischargeability (and by implication, general discharge) proceedings in federal bankruptcy court. The Hood Court reasoned "that a proceeding initiated by a debtor to determine the dischargeability of a student loan debt [owing to a State] is not a suit against the State for purposes of the Eleventh Amendment['s]" embodiment of states' constitutional sovereign immunity from suit, because "the bankruptcy court has in rem jurisdiction over the matter." Likewise, the Court opined that "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," as "the exercise of its in rem jurisdiction to discharge a debt does not infringe state sovereignty."

The holding in Hood is a very limited one, by virtue of both the Court's express directions and the logic of the Court's opinion, which (as the Court itself implicitly acknowledged) cannot sensibly extend even to all aspects of the discharge of state claims. Most significantly, Hood's in rem exception to state sovereign immunity in bankruptcy will not countenance enforcement of the discharge injunction against states. Indeed, without an enforceable discharge injunction, the Hood decision is virtually meaningless — which is where Ex parte Young comes into play.

The Ex parte Young corollary to states' constitutional sovereign immunity permits a federal court to award prospective declaratory and injunctive relief against state officials in their official capacities (irrespective of the immunity of the state itself from such relief), ordering the state officials to conform their future conduct to the requirements of federal law. In an earlier article, I advanced a very simple and (in retrospect) obvious, yet largely overlooked proposition: a federal bankruptcy court's discharge order, in and of itself, is a permissible Ex parte Young order. A general discharge order, as well as any individualized dischargeability determination, is a declaratory and injunctive decree that directly restrains state officials from any future collection efforts on behalf of a state that would contravene federal bankruptcy law. A state official that knowingly violates a debtor's bankruptcy discharge, therefore, has violated a valid Ex parte Young injunction and is subject to the contempt sanctions of the federal bankruptcy court from which the discharge order issued.

Hood's use of principles of in rem jurisdiction to justify discharge and dischargeability determinations is an exercise in forced, formalistic, fictional reasoning that bears only the most tenuous (and in the case of dischargeability determinations, no meaningful) relationship to the jurisdictional principles invoked. And the relevance of these in rem jurisdictional principles to the state sovereignty concerns embedded in the Eleventh Amendment remains unexplained (by the Court) and, therefore, wholly speculative. The holding in Hood evinces the Court's general desire to preserve a perceived essence of the federal bankruptcy process by exempting it from states' sovereign immunity. The principles of in rem jurisdiction relied upon in Hood, however, are not robust enough to thoroughly assimilate the essence of federal bankruptcy relief. This article, thus, suggests a more fruitful line of pursuit: function, not fiction. The functional inquiry embodied in modern Ex parte Young doctrine fully captures the essence of federal bankruptcy relief and, thus, provides a medium for reconciling effective enforcement of federal bankruptcy law with states' constitutional sovereign immunity that is eminently more principled and coherent than the artificial legal fictions espoused by the Hood Court.

Original languageEnglish (US)
Pages (from-to)59-127
JournalAmerican Bankruptcy Institute Law Review
StatePublished - 2005


  • state sovereign immunity
  • bankruptcy discharge
  • Ex parte Young
  • Tennessee Student Assistance Corp. v. Hood
  • Seminole Tribe v. Florida
  • prospective nonmonetary relief
  • discharge injunction
  • dischargeability determination
  • Pennoyer v. Neff
  • personal jurisdiction
  • Hanover Bank v. Moyses


Dive into the research topics of 'From Fictionalism to Functionalism in State Sovereign Immunity: The Bankruptcy Discharge as Statutory Ex parte Young Relief After Hood'. Together they form a unique fingerprint.

Cite this