## Facts

- Congress enacted the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) to address perceived abuses in consumer bankruptcy.
- BAPCPA regulates “debt relief agencies,” defined to include (with specified exceptions) persons who provide “bankruptcy assistance” to “assisted persons” for payment.
- BAPCPA § 526(a)(4) bars a debt relief agency from advising an assisted person to incur more debt “in contemplation of” bankruptcy.
- BAPCPA § 528(a)–(b) requires specified disclosures in a debt relief agency’s advertisements, including that services involve bankruptcy relief and that the advertiser is a “debt relief agency.”
- A Minnesota law firm providing consumer bankruptcy services brought a pre-enforcement action seeking declaratory relief, arguing it was not a “debt relief agency” and that §§ 526(a)(4) and 528 were unconstitutional as applied to attorneys.
- The district court largely agreed, concluding attorneys were not “debt relief agencies” and that the provisions were unconstitutional as applied to attorneys.
- The court of appeals held attorneys could be “debt relief agencies,” upheld § 528’s disclosures, but invalidated § 526(a)(4) as overbroad.
- The Supreme Court granted review.

## Issues

1. Whether attorneys who provide “bankruptcy assistance” to consumer debtors for payment qualify as “debt relief agencies” under 11 U.S.C. § 101(12A).
2. Whether § 526(a)(4)’s prohibition on advising a debtor to incur more debt “in contemplation of” bankruptcy should be narrowly construed, and whether it is constitutional as applied to attorneys.
3. Whether § 528’s mandatory advertising disclosures, as applied to attorneys, violate the First Amendment.

## Decision

- Attorneys providing bankruptcy assistance to assisted persons for payment fall within the statutory definition of “debt relief agency.”
- Section 526(a)(4) is valid as applied to attorneys when construed to prohibit only advice to incur more debt because of the anticipated bankruptcy filing (i.e., advice aimed at exploiting discharge), not advice to incur debt for legitimate purposes.
- Section 528’s advertising disclosure requirements are constitutional as applied to attorneys because the compelled statements are factual and reasonably related to preventing consumer deception.
- The judgment below was affirmed in part and reversed in part.

## Legal Principles

- Statutory definitions are applied according to their text; where Congress lists specific exceptions, courts generally do not create additional exclusions absent textual support.
- “Debt relief agency” under 11 U.S.C. § 101(12A) includes attorneys who, for payment, provide “bankruptcy assistance” (including advice, counsel, and document preparation) to qualifying consumer debtors.
- Section 526(a)(4) is properly construed to reach advice to incur debt because the debtor expects to file bankruptcy and obtain discharge, targeting abusive prebankruptcy conduct rather than legitimate financial planning.
- Compelled disclosures in commercial advertising are permissible when they require factual, uncontroversial information and are reasonably related to preventing consumer deception; they are invalid only if unjustified or unduly burdensome.

## Conclusion

The Supreme Court held that consumer-bankruptcy attorneys are subject to BAPCPA’s “debt relief agency” provisions and upheld both the advice restriction in § 526(a)(4) under a narrowing construction and the mandatory advertising disclosures in § 528 as constitutionally permissible regulation of attorney practices in the bankruptcy context.


Milavetz, Gallop & Milavetz, P.A. v. United States, 559 U.S. 229 (2010)