The Goldman Sachs decision may offer a path through the longstanding conflict: beyond asking whether a dispute is core, future courts may use the Supreme Court’s analysis in Stern to assess whether the dispute lies within the bankruptcy court’s constitutionally protected sphere of authority.

In Goldman Sachs Bank USA v. Brown, No. 25-1439 (4th Cir 2026), the Fourth Circuit refused to send a debtor's stay-violation claim to arbitration, ruling it belongs in bankruptcy court as a fundamental bankruptcy claim. This is a more refined position on the existing split of authority on the clash between the Federal Arbitration Act (FAA) and the Bankruptcy Code (the "Code"). The article will focus on the implications of this more nuanced approach, including whether the ultimate dividing link in bankruptcy arbitration cases is not whether a claim is labeled "core" under 11 U.S.C. 157, but whether it falls within the narrower category of matters that Stern v. Marshall, 564 U.S. 462 (2011), recognizes as constitutionally committed to the bankruptcy process itself.

Read the full article written by Steve McNeill and Sarah Gladieux and published in The Bankruptcy Strategist. Login may be required.