August Term 2022

(Argued: April 18, 2023 | Decided: August 2, 2023)

Docket No. 22-1000

KIMBERLY BRUCE, Debtor and Plaintiff on behalf of herself and all others similarly situated, AKA Kimberly A. Bruce, AKA Kimberly Antrell Bruce,

Plaintiff-Appellee,

v.

CITIGROUP INC. and CITIBANK, N.A.,

Defendants-Appellants. 1 ______________ Before: WESLEY, PARK, and ROBINSON, Circuit Judges:

Defendants-Appellants Citigroup Inc. and Citibank, N.A. (collectively, “Citi”) appeal from the bankruptcy court’s order granting in part and denying in part Citi’s motion, pursuant to Federal Rule of Bankruptcy Procedure 7012, to dismiss Plaintiff-Appellee Kimberly Bruce’s amended complaint, or, alternatively, to strike or dismiss the nationwide class action allegations therein.

On appeal, Citi advances two primary arguments. First, Citi argues that a bankruptcy court’s civil contempt power is limited to the enforcement of its own orders, and, therefore, that the Bankruptcy Code does not authorize one bankruptcy court to adjudicate the claims of a nationwide class of former debtors

1 The Clerk of the Court is directed to amend the official caption as set forth above. seeking to hold Citi in contempt of discharge orders entered by other bankruptcy courts across the country. Second, Citi argues that plaintiff’s claim for violation of her discharge order and injunction under 11 U.S.C. § 524(a)(2) fails to satisfy the civil contempt standard under Taggart v. Lorenzen, 139 S. Ct. 1795 (2019). We agree with Citi’s first argument but disagree with the second. Accordingly, we AFFIRM IN PART and REVERSE IN PART the bankruptcy court’s order and REMAND the case to the bankruptcy court for further proceedings consistent with this opinion. _________________

GEORGE F. CARPINELLO, Boies Schiller Flexner LLP, Albany, NY (Adam R. Shaw, Jenna C. Smith, Boies Schiller Flexner LLP, Albany, NY; Charles Juntikka, Charles Juntikka & Associates LLP, New York, NY, on the brief), for Plaintiff-Appellee.

EAMON P. JOYCE (Benjamin R. Nagin, Jonathan W. Muenz, James R. Horner, on the brief), Sidley Austin LLP, New York, NY, for Defendants-Appellants.

Robert J. Pfister, KTBS Law LLP, Los Angeles, CA, for Amici Curiae National Consumer Bankruptcy Rights Center; National Association of Consumer Bankruptcy Attorneys in Support of Plaintiff-Appellee. _________________ WESLEY, Circuit Judge:

Unwelcome as insolvency may be, bankruptcy relief ultimately provides hope for the debtor that a new financial life awaits. The notion of a fresh start is at the Bankruptcy Code’s core and is typically achieved through a discharge order, which, at a bankruptcy proceeding’s conclusion, releases the debtor of

2 pre-bankruptcy debts covered by the order, and acts as an injunction to bar creditors from further attempts to collect those debts. See 11 U.S.C. § 524(a)(2).

In this case, a putative nationwide class of former debtors, led by Kimberly Bruce, claim that Citi violated their respective discharge injunctions. They ask that Citi be held in contempt, and, in addition to contempt sanctions, ask for declaratory relief and restitutionary damages.

As an initial matter, we reject plaintiff’s suggestion that she has asserted separate and distinct claims for declaratory relief and damages. For one, plaintiff’s characterization of her complaint is in tension with the complaint itself, which asserts a single