When a defendant in a civil lawsuit files for bankruptcy, the automatic stay can halt proceedings against that party. However, the question of whether litigation continues against other defendants often remains contested. A recent decision issued in California highlights how bankruptcy stays intersect with multi-party civil rights litigation, and how…
Bankruptcy cases often involve overlapping legal proceedings in state court and federal bankruptcy court, and debtors must take care that their actions do not run afoul of the confirmed Chapter 13 plan. A recent decision by a California court highlights that even when post-confirmation developments raise questions about debtor conduct,…
Bankruptcy law permits debtors to protect certain property from liquidation through state and federal exemptions. However, when exemptions are improperly claimed or unsupported by law, trustees may object, and courts must determine the legitimacy of those claims. A recent decision from a California court demonstrates how a debtor’s exemptions may…
Bankruptcy proceedings often involve not just questions of debt relief but also serious disputes over property rights, trust ownership, and trustee powers. When a debtor attempts to shield property by placing it in trust or disputes the trustee’s control over valuable real estate, the court must step in to determine…
California bankruptcy law offers certain protections to debtors through the homestead exemption, which allows individuals to shield a portion of their home equity from creditors. However, these protections are not absolute. A recent California bankruptcy decision highlights the limitations of the exemption when a debtor fails to meet the required…
Bankruptcy courts overseeing mass tort reorganizations involving institutions accused of systemic abuse must balance transparency with privacy. In a recent decision, a California bankruptcy court permitted the release of anonymized abuse claims data and internal board minutes in the Chapter 11 proceedings involving a major religious institution. The ruling reflects…
Default judgments are disfavored in bankruptcy litigation, particularly when they prevent a party from presenting defenses to serious financial allegations. The strong policy preference for adjudicating cases on the merits rather than on procedural missteps was demonstrated in a recent California ruling in which a creditor successfully challenged a bankruptcy…
Financial disputes between business partners can quickly escalate, especially when one party seeks to hold the other personally liable for alleged misconduct. It is not uncommon for one party in a business lawsuit to attempt to avoid liability by filing for bankruptcy, but whether discharge is granted depends on numerous…
In bankruptcy proceedings, the automatic stay and discharge injunction provides critical protections for debtors by preventing creditors from collecting on debts outside the bankruptcy process. These protections have limitations, however, particularly when a debtor’s assets have been exempted from the bankruptcy estate, as demonstrated in a recent California case. If…
In civil litigation involving defendants who file for bankruptcy, automatic stays under the Bankruptcy Code can complicate the proceedings. A recent California decision illustrates how courts handle the interplay between bankruptcy stays and ongoing civil cases. If you are navigating a case involving bankruptcy, it is crucial to consult a…