A Lack of ‘Stern’ Jurisdiction Bars a Transfer Under 28 U.S.C. § 1631

Even if a bankruptcy court is considered a “court of the United States,” the bankruptcy court does not have power to transfer a suit to another district under 28 U.S.C. § 1631 if the bankruptcy court lacks constitutional jurisdiction in the first place, the Third Circuit held. The Governing Statutes Section 1631 was adopted to ensure that a suit will not be barred by the statute of limitations if the suit was originally filed in a district lacking jurisdiction. When “a civil action is filed in a court as defined in [28 U.S.C. §] 610, . . . and that court finds that there is a want of jurisdiction,” the section provides that “the court shall, if it is in the interest of justice, transfer such action” to a court where the suit could have been brought, “and the action . . . shall proceed as if it had been filed [in the transferee court] . . . on the date” when it was filed in the original court. In turn, Section 610 defines “courts” to include “the courts of appeals and district courts of the United States,” and other courts not relevant to the case on appeal.

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