Opinion ID: 174856
Heading Depth: 2
Heading Rank: 1

Heading: Attorneys Providing Bankruptcy Assistance to Consumer Debtors Qualify as Debt Relief Agencies

Text: At its core, plaintiffs' complaint sought a judicial declaration that the challenged statutes do not apply to attorneys, either because the term debt relief agency does not include attorneys, or because, if the term does include attorneys, the statutes violate the Constitution. Plaintiffs' first argument is now foreclosed by Milavetz, Gallop, & Milavetz, P.A. v. United States, 130 S.Ct. at 1333, which holds that attorneys representing consumer debtors can qualify as debt relief agencies. The Supreme Court observed that the term debt relief agency was statutorily defined as `any person who provides any bankruptcy assistance to an assisted person' in return for payment. Id. at 1332 (quoting 11 U.S.C. § 101(12A)). While the statute specifically excludes a variety of persons, attorneys are not among them. See id. [10] In fact, the Court noted that the definition of bankruptcy assistance includes a service, the `provi[sion of] legal representation with respect to a case or proceeding,' § 101(4A), that may be provided only by attorneys. Id. (citing also 11 U.S.C. § 110(e)(2) (prohibiting bankruptcy petition preparers from providing legal assistance)). [11] The Court, nevertheless, determined that use of the term assisted person in the § 101(12A) definition of debt relief agency signaled that not all attorneys providing bankruptcy assistance qualified as debt relief agencies. Assisted person is statutorily defined as any person whose debts consist primarily of consumer debts and the value of whose nonexempt property is less than $175,750. 11 U.S.C. § 101(3). From this definition, stated in terms of the person's debts, ... and from the text and structure of the debt-relief-agency provisions in §§ 526, 527, and 528..., including § 528's disclosure requirements, the Supreme Court deemed it evident that §§ 526-528 govern only professionals who offer bankruptcy-related services to consumer debtors. Milavetz, Gallop & Milavetz, P.A. v. United States, 130 S.Ct. at 1341. Following this holding, we review plaintiffs' constitutional challenge to the statutes at issue with the understanding that the only attorneys qualifying as debt relief agencies are those advising consumer debtors contemplating bankruptcy.