Jewish Religious Court Lacks Standing To Appeal Bankruptcy Stay of Its Proceedings

As previously reported, last year a New York federal bankruptcy court held that the statutory automatic stay of proceedings against a debtor that is triggered by the filing of a petition in a bankruptcy reorganization applies to invalidate proceedings against a debtor and its principals brought in a Jewish religious court (bais din). In In re Congregation Birdchos Yosef, (SD NY, Sept. 27, 2016), a New York federal district court dismissed for lack of standing an appeal of the bankruptcy court's decision brought by the Jewish religious court involved:

 Any effect on the Bais Din from that decision is indirect, seeks to challenge orders directed at third parties, and is insufficient to confer standing.....

Appellant argues that “[t]he Bais Din is a gatekeeper who ensure [sic] that community members can seek to enforce community standards and Jewish law,” and that the Bankruptcy Court’s Order enforcing the automatic stay “interferes with this function.”... This contention underscores the lack of any direct, financial impact the Bankruptcy Court’s Order has had – or could have – on the Bais Din....

That the Bais Din claims that its or its constituents’ constitutional right to the free exercise of religion was impaired by the Bankruptcy Court’s ruling does not give it standing.

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