Constitutional Clockwork: When Jury Rights Defy Procedural Time

January 12, 2026

The following is a case review written by Hale Andrew Antico, Chief Counsel of Antico Law Firm, analyzing Namba v. Jafroodi (In re Jafroodi), 2025 WL 3539243 (Bankr. C.D. Cal. Nov 30, 2025), a recent case of interest.

SUMMARY

In Jafroodi, the bankruptcy court held that a jury trial demand filed months after the amended complaint was not waived by procedural delay or a district court’s denial of withdrawal, preserving the Seventh Amendment right despite administrative lags.  The bankruptcy court then ordered transfer to the district court to safeguard the constitutional guarantee. The court emphasized that procedural efficiency cannot override fundamental constitutional rights in bankruptcy proceedings.

To view the full decision, click here.

FACTS

In December 2022, Chapter 7 Trustee Jerry Namba (“Namba”) brought an adversary proceeding (“AP”) in a bankruptcy alleging a fraudulent transfer against Debtor Mahmood Jafroodi and Michael Kaylor as trustee of Debtor’s retirement plan (“Defendants”)..  After defective service and a vacated default judgment, Namba filed an amended complaint in August 2023, alleging 17 causes of action. In January 2024, Defendants filed their answers, the title page of each stating conspicuously: “DEMAND FOR JURY TRIAL,” with a paragraph following it explicitly demanding the same… almost six months after the amended complaint was filed. The demand for a jury trial transformed a routine procedural matter into a constitutional question.

In September 2024, Defendants filed in the district court a Motion to Withdraw the Reference (“Motion”) of the AP to the bankruptcy court under 28 USC § 157(d), which Namba opposed. In November 2024, the district court entered an order denying the Motion on the following grounds:  that it was untimely for claims known about in 2022; the extent of the proceedings that had occurred since then; failure to file within seven days of the pretrial order as required by Local Bankruptcy Rule (“LBR”) 9015-2; immediacy of the withdrawal of the reference was not mandatory; and declined as a matter of discretion. Jafroodi at *11-12. The next month, Defendants filed a petition for writ of mandamus with the Ninth Circuit Court of Appeals, which denied the petition without addressing the merits of the jury trial argument.

With discovery complete and the pretrial phase concluded, the bankruptcy court confronted a foundational question: had the Defendants’ Seventh Amendment right been forfeited by delay, or was it preserved despite the procedural missteps? The court answered: preserved.

REASONING

This analysis proceeds in four steps: (1) Does the Seventh Amendment apply? (2) Can the right be waived? (3) Was there a waiver here? and (4) Did the district court’s denial effectively deny the right?

The court started with the Seventh Amendment, which specifically applies to bankruptcy fraudulent conveyance actions where the defendant has not filed a proof of claim, as settled by the Supreme Court in Granfinanciera, S.A. v. Nordberg, 492 U.S. 33, 41 (1989). Further, the court quoted at *16: 

“The right to trial by jury is ‘of such importance and occupies so firm a place in our history and jurisprudence that any seeming curtailment of the right’ has always been and ‘should be scrutinized with the utmost care.’” Sec. & Exch. Comm’n v. Jarkesy, 603 U.S. 109, 121 (2024) (quoting Dimick v. Schiedt, 293 U.S. 474, 486 (1935));

Although this right can be waived, Ninth Circuit precedent requires courts to “indulge every reasonable presumption against waiver.” Solis v. County of Los Angeles, 514 F.3d 946, 953 (9th Cir. 2008) (quoting Pradier v. Elespuru, 641 F.2d 808, 811 (9th Cir. 1981)).  While Namba conceded that both Defendants timely demanded a jury trial under Civil Rule 38(b), he argued that waiver of the right was twofold:

First, Namba claimed that the motion for withdrawal of the reference had to be submitted and approved promptly with the demand under Rule 38(b), relying on a Tenth Circuit ruling. Stainer v. Latimer (In re Latimer), 918 F.2d 136 (10th Cir. 1990). The court rejected this argument, reasoning that the Tenth Circuit added procedural hurdles beyond Civil Rule 38(b) or Bankruptcy Rule 9015. The Latimer “curtailment,” once given “utmost care,” does not survive the court’s scrutiny. The court found Latimer‘s procedural requirement incompatible with both the text of the rules and Ninth Circuit precedent, which permits bankruptcy courts to handle pretrial matters even when a jury trial right exists in the district court. In re Healthcentral.com, 504 F. 3d 775 (9th Cir 2007). Jafroodi at *19-20. There, the Ninth Circuit started with the Granfinanciera right to a jury trial, and held that a “valid right to a Seventh Amendment jury trial in the district court does not mean the bankruptcy court must instantly give up jurisdiction and that the action must be transferred to the district court. Instead, we hold, the bankruptcy court may retain jurisdiction over the action for pre-trial matters.” Healthcentral.com at 787.

Second, Namba argued that when the district court denied the Motion it ruled on the merits of the constitutional right, contending that while the jury right was not denied explicitly, the effect is the same.  The bankruptcy court disagreed, noting that at the time the district court denied the motion, pretrial proceedings, including discovery, were very much underway. The court rejected this argument, finding no indication in the district court’s order that it intended to deny permanently the constitutional right, only to manage the timing of withdrawal pending completion of pretrial proceedings. “To infer that the District Court intended to deny Jafroodi and Kaylor their Seventh Amendment jury trial right would be, to say the least, presumptuous. There is simply nothing in the District Court’s order to support this conclusion.” Jafroodi at *3-4. Further, the district court cited Healthcentral.com by name while remarking that the bankruptcy court can hold jurisdiction while discovery was completed. Id. at *21-22.The district court’s failure to address the constitutional dimensions of the jury trial right, combined with its citation of Healthcentral.com, demonstrates that its denial was procedural, not substantive. Finally, there was no knowing and voluntary waiver of the right. The court noted that to interpret the district court’s ruling as denying the Defendants’ constitutional right would go against the Supreme Court’s guidance to use the utmost care in any curtailment of the jury right.

Because the trustee’s arguments that there was a waiver or denial of the Defendants’ right to a jury trial was against the direction from the Supreme Court, Ninth Circuit precedent, lacked a knowing waiver, and was not supported in the record from the district court, the bankruptcy court ruled that, with discovery now complete, the case can be withdrawn to the district court for a jury trial. The court’s decision reinforces that procedural complexity cannot override constitutional protections, and that jury trial rights require the utmost judicial protection to withstand scrutiny.

AUTHOR’S COMMENTARY

If you’re like me, you don’t hear much about jury trials in bankruptcy. Let’s face it: empanelment of jurors in Chapter 7 isn’t exactly water cooler talk at the cdcbaa’s Ashland Award dinner or ILC’s annual conference. Instead, you file the petition, attend the 341(a), and as the machinery churns away efficiently, months later there’s a discharge. But every now and then, a case comes along to remind us that bankruptcy is tied to fundamental rights, and invokes the U.S. Constitution.

The bankruptcy system is a clockwork machine: precise, efficient, relentless. But even the most finely tuned machines need a fail-safe. Here, Judge Barash did not stop the gears. Instead, he ensured the safety valve (constitutional right) would not be welded shut.

And underlying this entire dispute is the bankruptcy system’s relentless pursuit of efficiency… a noble goal, yes, but not at the cost of the Constitution. The bankruptcy process enforces rigidly its procedure and deadlines. A lesson here isn’t simply when to demand a jury, but that procedural adherence can’t eclipse constitutional entitlement. The court rightly rejected the tenth circuit’s procedural demand demanding a procedural requirement for a right… that is not required. Latimer’s procedural requirement of something not in the rules is what the court correctly quoted as a “tricky procedural trap.” One that would have buried the right before it could be heard. But this technical requirement must yield to the Supreme Court’s emphasis on preserving jury rights. Further showing this point is enactment of 28 USC § 157(e), allowing bankruptcy courts to conduct jury trials with the consent of all parties (not present here). Congress’s enactment of 28 U.S.C. § 157(e), undermines the procedural logic of Latimer, which required immediate withdrawal to preserve the right. This demonstrates Congress’ awareness of the potential for jurisdictional friction and providing a consent-based solution.

The Supreme Court in Granfinanciera said that even the seeming curtailment of the jury right should be scrutinized with the utmost care. There is every presumption against waiver of these rights. And Healthcentral.com made it clear: bankruptcy courts can keep jurisdiction over cases for pre-trial matters. This is entirely consistent with the need to give heightened scrutiny to any alleged abridgment of rights.

Takeaways For Attorneys

Consider making a timely demand for a jury trial and strategically evaluating the need to file a proof of claim, which is consent to jurisdiction of the bankruptcy court. For practitioners, this case is a clear signal: a jury trial demand is not a procedural formality, but a constitutional assertion. A delay in filing a motion to withdraw the reference does not equate to waiver, and courts must scrutinize any such inference with the utmost care. Practitioners should now treat jury trial demands as constitutional assertions, not procedural checkboxes, and file them early, even if the motion to withdraw is delayed. Courts should resist inferring waiver of a fundamental right from a procedural default.

Why It Matters

Ultimately, this case is a reminder that bankruptcy, for all its procedural rigor, is still tethered to the Constitution. While the system strives for seamless operation, the right to a jury trial acts as a vital safety valve, preventing the machinery from grinding individual liberties into dust, and that is the point. In bankruptcy, the system may run on gears and schedules, but the right to a jury trial is not a bolt, but a fuse. A misaligned gear may grind, but the fuse only ignites when the right is truly threatened. In Jafroodi, the fuse was not lit by procedural delay, but by judicial caution. A jam in the gears, it turns out, can be a feature, not a bug.