The Rooker-Feldman doctrine is a jurisdictional rule that prevents lower federal courts (including the Bankruptcy Courts) from exercising appellate jurisdiction over final state-court judgments. The rule is in place because these types of appeals are reserved for the Supreme Court. However, the doctrine has limits.
In the Third Circuit, there are four elements that must be met in order for the doctrine to apply: (1) the party challenging the state-court judgment lost in state court; (2) that party’s complaints are based on injuries caused by the state-court judgments; (3) those judgments were rendered prior to the filing of the federal suit; and (4) that party is seeking to have the lower federal court review and reject the state-court judgments. See Great W. Mining & Mineral Co. v. Fox Rothschild LLP, 615 F.3d 159, 166 (3rd Cir. 2010). Therefore, Rooker-Feldman is meant only to prevent lower federal courts from reviewing final state-court judgments on their actual merits.
Although it may be mistaken for a rule of preclusion, Rooker-Feldman is only a rule of jurisdiction with an accordingly limited applicability. While they cannot hear a challenge to a state-court judgment on its merits, Bankruptcy courts in the Third Circuit have the exclusive statutory power to decide if a debt is dischargeable in a bankruptcy case. Therefore, the jurisdiction of a bankruptcy court to determine nondischargeability proceedings is not subject to Rooker-Feldman’s jurisdictional limitations. These determinations are viewed as independent from the underlying state-court judgment.
The Rooker-Feldman doctrine is simply a jurisdictional rule that denies lower federal courts appellate jurisdiction over final state-court judgments under certain, well-defined circumstances. It is important to see the doctrine’s limits. If any of the four elements listed above are missing, Rooker-Feldman will not prevent a bankruptcy court from exercising its jurisdiction.