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Northern Pipeline Co. v. Marathon Pipe Line Co. | 458 U.S. 50 (1982)
Article III of the Constitution ensures the federal judiciary’s independence from other branches of government and permits Congress to create lower federal courts. Over the years, congressional delegations of Article III power haven’t always worked out. In Northern Pipeline Construction Company versus Marathon Pipe Line Company, a federal statute establishing bankruptcy courts was totally liquidated.
In 1978, Congress enacted the Bankruptcy Reform Act. The act created bankruptcy courts, specifying that bankruptcy judges would serve fourteen-year terms and that their salaries wouldn’t be protected from decreases. Under the act, judges had broad jurisdiction over all civil proceedings arising under bankruptcy laws and all suits arising in, or related to, cases under bankruptcy laws. So, bankruptcy judges were empowered to hear both federal- and state-law claims. The act also set a process for appealing bankruptcy orders to federal district and circuit courts.
In 1980, Northern Pipeline Construction Company filed a petition to reorganize in the United States Bankruptcy Court for the District of Minnesota. Within the proceeding, Northern filed a breach-of-contract claim against Marathon Pipe Line Company. Marathon moved to dismiss the suit, alleging that the act unconstitutionally granted Article III power to non-Article III judges. The judge denied Marathon’s motion, and Marathon appealed to the United States District Court for the District of Minnesota. The district court granted Marathon’s motion, so Northern appealed to the United States Supreme Court, which granted cert.
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