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The author discusses a Supreme Court ruling that a doctor who provided substandard care was not exempt form bankruptcy discharge for willful and malicious injury under the Bankruptcy Code. The history of the 'willful and malicious' discharge exception is outlined.

The author analyses the Supreme Court's ruling in Bank of America v. 203 North LaSalle Street Partnership on Chapter 11 bankruptcy actions in which an insolvent company owners tries to continue to participate in the company based on post-petition contributions of new value.

Collateral estoppel should be applied in section 523(c) bankruptcy dischargeability proceedings according to the mandate of full faith and credit to other jurisdictions' court decisions. This solves the problem of courts debating if a federal test should be used on state court default decisions. Federal bankruptcy courts have wondered if they were exempt from full faith and credit. While the Supreme Court allowed estoppel in bankruptcy courts in Grogan v. Garner, it gave inadequate guidelines for estoppel's use.

The US 6th Circuit Court of Appeals in US v. Mansfield Tire & Rubber Co. correctly interpreted Bankruptcy Code s 507(a)(7) and held that since an assessment caused by a debtor's inadequate pension plan funding constituted an excise tax and not a penalty, the IRS deserved priority debt payment status over other creditors. Though the 6th Circuit's decision contradicts decisions from other circuit courts characterizing such assessments as penalties to be subordinated to other creditor's claims, the 6th Circuit approach comports with congressional powers to levy and prioritize taxes, and in this case, to compensate for costs associated with federal benefit plans.