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Terry L.
Terry L., Attorney
Category: Bankruptcy Law
Satisfied Customers: 2822
Experience:  Better Business Bureau. 18yrs bankruptcy experience. Chicago Bar Assoc. American Bankruptcy Institute member.
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Hi Terry, Can a civil complaint be filed for damages incurred

Resolved Question:

Hi Terry, Can a civil complaint be filed for damages incurred from the malicious fraudulent statements and false claim submitted by a creditor in a bankruptcy court? If possiable would it be an action in a lower court or Federal District Court?
Submitted: 5 years ago.
Category: Bankruptcy Law
Expert:  Terry L. replied 5 years ago.

Terry L. :

Hi, thanks for your question. You should hire a lawyer for specific legal advice. No attorney client relationship is created here.

Terry L. :

The initial place to dispute that claim would be in the bankruptcy court proceeding. If there is an adversary process, you can file a motion to supress that information if you can prove it was willfully false, and you can request sanctions for damages.

Terry L. :

If the information is in a proof of claim, the proper forum is to object to the claim.

Terry L. :

Once the judge rules on it, and if allowed, then the facts are presumed accurate. It is unlikely a case would survive outside of the bankruptcy forum. First, if a suit was brought outside of the case, it would likely draw an objection/motion to dismiss for res judicata - meaning that the issue has been resolved in another legal forum, which there is a strong weight given to the finality of the prior ruling. Second, if it survives that challenge, damages would be hard, if not impossible to prove, so , even if successful, the award might be minimum if that.

Terry L. :

Any claim, if you wish to bring it would be to appeal the decision. if the case was final in the bankruptcy court, the appeal would go to federal court of appeals for your jurisdiction.

Terry L. :

These types of challenges really require the use of an attorney, so it would be best to hire local counsel to assist in the matter.

Terry L. :

Thank you for your question, good luck.

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