Legal Challenges to the Client Communication Provisions of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 Page: 3 of 5
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" whether the prohibition against advising an assisted person12 to incur
additional debt in contemplation of filing for bankruptcy violates the First
" whether the mandate to make certain disclosures to assisted persons
violates the First Amendment.
Threshold Issue: The Standing Requirement
Standing has become a less significant obstacle to constitutional challenges of the
communication provisions. This is due to the increased willingness of lower court judges
to find the alleged suppression of speech to be a sufficient injury-in-fact. Initially, two
courts declined to address the constitutional challenges raised by the attorney plaintiffs,
finding that the plaintiffs did not have standing.13 Noting that no party had enforced any
of the communication provisions against them, both courts found that the plaintiffs failed
to show they suffered a sufficient personalized injury that could be addressed by the
courts. All other courts deciding this issue, however, have found that the attorney
plaintiffs have standing. Notwithstanding the absence of any enforcement action taken
against the plaintiffs, these courts concluded that the mere enactment of BAPCPA is a
sufficient injury due to the resulting chilling effect on attorneys' speech.14
The Communication Provisions: Judicial Interpretations
11 U.S.C. 101(12A): Definition of "Debt Relief Agency". BAPCPA
defines the term "debt relief agency" as any person who provides bankruptcy assistance
to an assisted person for payment or who is a bankruptcy petition preparer.5 This
definition contains certain exceptions, none of which expressly includes attorneys.16
Attorney plaintiffs have not been successful in arguing that the communication
provisions do not apply to them, even though the definition of debt relief agency does not
explicitly mention attorneys. With only one exception," all U.S. district courts facing the
matter have decided that attorneys are included in the definition of debt relief agency.18
12 Defined in 11 U.S.C. 101 (3) as "any person whose debts consist primarily of consumer debts
and the value of whose nonexempt property is less than $150,000."
13 Geisenberger v. Gonzalez, 346 B.R. 678, 681 (E.D.Pa. 2006); In re McCartney, 336 B.R. 588,
592 (Bankruptcy M.D.Ga. 2006).
14 Hersh v. U.S., 347 B.R. 19, 22 (N.D. Tex. 2006); Olsen v. Gonzalez, 350 B.R. 906, 912 (D.Or.
2006); Zelotes v. Martini, 352 B.R. 17, 21 (D. Conn. 2006); Milavetz v. U.S., 355 B.R. 758, 762
s 11 U.S.C. 101 (12A) (2005).
16 11 U.S.C. 101 (12A) (A)-(E) (2005).
1" The U.S. Bankruptcy Court for the Southern District of Georgia, in In re Attorneys at Law and
Debt Relief Agencies, 332 B.R. 66 (Bkrtcy.S.D.Ga. 2005), was the only court to hold that
attorneys are not included in the definition of "debt relief agencies" in 101(12A).
18 Hersh, 347 B.R.at 22; Olsen, 350 B.R. at 912; Zelotes, 352 B.R. at 19.
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Legal Challenges to the Client Communication Provisions of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, report, June 27, 2007; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc817804/m1/3/: accessed January 23, 2019), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.