Recent Changes to Bankruptcy Court Jurisdiction:
(Taken from In Re Harris Pine Mills, 44 F.3d 1431 – 1995)
Federal district courts have exclusive jurisdiction over all cases under Title 11 of the United States Code, and concurrent jurisdiction over all civil proceedings arising under Title 11, or arising in or related to cases under Title 11 28 U.S.C. § 1334(a), (b). Those matters falling under the heading of concurrent jurisdiction (i.e., civil actions involving claims that arise under or in or are related to Title 11 proceedings) may be filed originally in state court, then subsequently removed by one of the parties to federal district court. 28 U.S.C. § 1452(a). If the district court’s local rules so provide, the removed action will then be referred automatically to the bankruptcy court. 28 U.S.C. § 157(a). The non-removing party may in turn seek to have the case remanded to state court. 28 U.S.C. § 1452(b).6
28 U.S.C. § 1334:
(a) Except as provided in subsection (b) of this section, the district courts shall have original and exclusive jurisdiction of all cases under title 11.
(b) Except as provided in subsection (e)(2), and notwithstanding any Act of Congress that confers exclusive jurisdiction on a court or courts other than the district courts, the district courts shall have original but not exclusive jurisdiction of all civil proceedings arising under title 11, or arising in or related to cases under title 11.
Although concurrent jurisdiction claims under section 1334 are all treated the same for purposes of removal under section 1452, a distinction exists between those concurrent jurisdiction claims that “arise under” or “arise in” Title 11 on the one hand, and those that are merely “related to” Title 11 on the other hand. This distinction between “arising under,” “arising in,” and “related to” Title 11 has significance as a jurisdictional consideration:
“Arising under” and “arising in” are terms of art. They are two of the three categories of cases over which district courts have jurisdiction under 28 U.S.C. § 1334(b). The third category includes cases “related to” a case under title 11. As the Fifth Circuit has explained,
“Congress used the phrase “arising under title 11” to describe those proceedings that involve a cause of action created or determined by a statutory provision of title 11…. The meaning of “arising in” proceedings is less clear, but seems to be a reference to those “administrative” matters that arise only in bankruptcy cases. In other words, “arising in” proceedings are those that are not based on any right expressly created by title 11, but nevertheless, would have no existence outside of the bankruptcy.”
If the proceeding does not invoke a substantive right created by the federal bankruptcy law and is one that could exist outside of bankruptcy it is not a core proceeding; it may be related to the bankruptcy because of its potential effect, but … it is an “otherwise related” or non-core proceeding. In re Harris Pine Mills (9th Cir. 1995) 44 F.3d 1431, 1435.
Put another way, claims that arise under or in Title 11 are deemed to be “core” proceedings, while claims that are related to Title 11 are “noncore” proceedings. In re Harris Pine Mills (9th Cir. 1995) 44 F.3d 1431, 1435.