Is a Bankruptcy Class Action Lawsuit the Way to Go?
If you are interested in filing a bankruptcy class action lawsuit, you may be wondering what this type of lawsuit is and how it works. Generally speaking, a bankruptcy class action lawsuit consists of a number of plaintiffs who have similarly fallen under financial distress and are seeking some sort of resolution to their dilemma.
Usually, the lead plaintiff in such a lawsuit is a businessperson or an individual with a large corporation. The businessperson or corporation will seek damages on behalf of all its employees, but it will seek to recover these damages individually, as only a few people will likely have the financial means to cover the damages.
You will find that filing such a lawsuit involves a number of different steps and that many of them will be beyond the scope of this article, but it is important to understand the basis of such actions in order to better understand what you will likely be facing if you do decide to file for bankruptcy.
One of the most important things to understand about filing a bankruptcy class action lawsuit is that the process itself will be rather complicated and lengthy.
Indeed, it can take years before the entire case shakes out. At the same time, the process must be overseen by a bankruptcy court, which is generally controlled by the state in which your bankruptcy case has been filed.
The purpose of this oversight is to ensure that the process runs smoothly and that the final decisions made are not later reversed due to some ill-conceived legal theory or statute. In short, you will need to ensure that the process is above board and that you fully understand everything that will be involved if you choose to file for bankruptcy.
A bankruptcy class action lawsuit, of course, involves a number of unique aspects, and the nature of those aspects will vary depending upon the specific case in question.
For example, if you are filing to discharge your liability under section 1201(b) of the federal regulations, you will probably have much less protection than you would if you were filing to recover damages under the state’s laws.
(section 1201(b) states that “the trustee or the custodian of an insolvent business may recover the debts of the business from the owners of the business during the course of the liquidation or reorganization of the insolvent business.”
The court’s order granting the bankruptcy class action lawsuit will describe the method by which the debts of the business will be recovered in every case.
Bankruptcy action lawsuits can be filed in state courts, federal courts, and all three branches of the Federal Trade Commission.
However, the procedures to filing in each of these courts will be very different, as will the outcome that you can expect. Indeed, while many lawyers may know the basic principles applicable in each of these areas, others will also likely be very busy with cases in which they have no experience at all filing bankruptcy actions. As a result, your initial consultation with a bankruptcy attorney will be spent evaluating your particular needs.
Of course, it is possible to file a bankruptcy class action lawsuit on your own without the help of an attorney.
It should be noted, however, that if you do choose to file this type of lawsuit on your own, you are absolutely going to need an attorney to help with the filings, to review your claims and to assist with the defense of your case.
It is also worth noting that if your lawsuit is successful, you may not recover any damages, at all. Therefore, it is absolutely crucial that you retain an attorney at the very beginning of your lawsuit in order to ensure that you receive the maximum possible settlement for your loss.
Once you have retained an attorney, you will be able to begin the process of filing your bankruptcy class action lawsuit.
At this point, it is extremely important that you retain a bankruptcy lawyer to represent you, even if you are filing on your own. The reason for this is simple: your bankruptcy claim is a matter of public record, and if the records are improperly obtained or inaccurate, the results could be disastrous for you. Therefore, your bankruptcy attorney should do everything in his or her power to prevent such a situation from occurring.
