They Went Broke Too Darlin’! F. Lee Bailey!

F. Lee Bailey

F. Lee Bailey

Attorney F. Lee Bailey, best known for his 1995 representation of former football player, broadcaster and actor O.J. Simpson, filed for bankruptcy in the United States Bankruptcy for the District of Maine Case No. 16-20375, listing a $5.2 million debt to the IRS.

F. Lee Bailey Bankruptcy Pleadings

Bailey had exhausted his options to challenge a debt in excess of $5,000,000.00 owed to the Internal Revenue Service.

F. Lee Bailey and O.J. Simpson

F. Lee Bailey and O.J. Simpson

The tax debt stems from his representation of Claude Duboc .

Duboc plead guilty to drug smuggling and money laundering.  As part of the plea deal, Duboc agreed to forfeit his assets, part of which were to be used by Bailey as a source for his attorney fees in the case. However the government later claimed that Bailey misappropriated the funds.

Bailey was held in contempt of court and thrown in jail for 44 days until he was able to pay $2.3 million to the court. He was also disbarred in the States of Florida and Massachusetts.

Bailey has since passed Maine’s bar exam in 2012, but he was ultimately denied admission.

In his Chapter 7 petition, Bailey lists $408,176 in assets against more than $5.6 million in liabilities.

 

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Edgar Allen Poe. They Went Broke Too!

Edgar Allan Poe

Edgar Allan Poe

Edgar Allen Poe was one of America’s most famous writers.  He was also one of the first American writers to attempt to support himself through his writing alone.

With no real international copyright protection in the early to mid 1800’s, Poe found himself in financial trouble and in 1842 filed for bankruptcy.

The bankruptcy was filed in the U.S. District Court for the Eastern District of Pennsylvania.

Poe Bankruptcy Cover Sheet

Poe Bankruptcy Cover Sheet

Poe’s bankruptcy declared that he was “possessed of no Property, real, personal or mixed, beyond his wearing apparel, and a few printed sheets, of no use to any one else, and of no value to anyone.”

Poe Bankruptcy Schedule B

Poe Bankruptcy Schedule B

Schedule A , a detailed list of debts, showing the names of creditors, their addresses, the nature of the debts, and the amounts owed. The amounts ranged from $4.00 to $169.10.

Poe Bankruptcy Schedule A

Poe Bankruptcy Schedule A

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Rapper 50 Cent Bankruptcy Update!

50 Cent.BrokeI previously posted about the Chapter 11 Bankruptcy filing of Rapper 50 Cent.

Since the filing, 50 Cent has posted three photographs of himself with large sums of money.  In one photo, 50 Cent is seen sitting on the floor next to stacks of $100.00 bills spelling out the word “Broke”.

Suspicious creditors, including the rappers former girlfriend, Lastonia Leviston who won a multi-million dollar jury award over a sex tape, his mortgage lender and a partner in a failed headphone deal are asking the Court to appoint an outside financial manager to handle his money until he pay off the $30 million he owes creditors.

50 Cent.Money on Bed

This would be significant since a Chapter 11 Debtor is known as a “Debtor In Possession”.  This means that they control their own finances during the bankruptcy.

If the creditors are able to convince the Judge that 50 Cent is not handling his assets property the court can appoint a trustee manage the assets.

50 Cent.Refrigerator

50 Cent has been ordered to appear in court to respond to allegations that he is not disclosing all of his assets.

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Rapper 50 Cent Files For Bankruptcy!

50 Cent

50 Cent

 

The Rapper, Curtis “50 Cent” James Jackson III, filed for bankruptcy in the United States Bankruptcy Court for the District of Connecticut.

50 Cent filed a Chapter 11 bankruptcy following a New York jury award in an Invasion of Privacy lawsuit.

Lastonia Leviston

Lastonia Leviston

The lawsuit, filed by his former, Lastonia Leviston, came after 50 Cent  posted a sex tape of the former couple.

Documents filed on July 13, 2015 in Connecticut Bankruptcy Court case number 15-21233 indicate that Jackson’s total assets were listed in the range of $10 million to $50 million.

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Bankruptcy Filing Fees Increase

Costs going up

The cost of getting out of debt is going up.

The Judicial Conference of the United States has approved a$29.00 increase in the administrative fee charged to an individual when they file for bankruptcy.  The fee, which is currently $46.00, will increase to $75.00 on June 1, 2014.

This will make the filing fee for a Chapter 7 bankruptcy $335.00, and the fee for a Chapter 13 bankruptcy $310.00.

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Can A Debt Collector Have Me Put In Jail?

debt-collector-threat

The headline reads:  “Court Halts Debt Collector’s Allegedly Deceptive and Abusive Practices“.

The Debt Collectors in question portrayed themselves as representatives of the government by using company names that suggested a government affiliation or national presence, such as Federal Recoveries, LLC, Federal Check Processing, Inc, Federal Processing Services, Inc., Nationwide Check Processing, and State Check Processing, Inc..  They would threaten lawsuits, arrest and imprisonment or seizure of assets – unless consumers paid the debt immediately.

While it may be news to the general public that Debt Collector’s use deceptive practices to collect debts, it is a common complaint that I get from clients, both before and after filing for bankruptcy.

Some of the more common practices are:

  • Re-aging debt.  This is a practice where a Debt Collector purchases a debt and then reports the debt to the big three credit reporting agencies using the date it acquired the debt as the date the debt became late, rather than the actual that the debt got behind.
  • Telling someone that they are going to “swear out” a lawsuit or an arrest warrant because they owe money.  A frequent tactic is to call a spouse and tell them that the other spouse is about to be arrested in an effort to get a payment.
  • Telling someone that the debt they had wasn’t listed in their bankruptcy and that it has to be paid.   This is not true.  Even if a debt is not listed in a bankruptcy, the debt is normally discharged.
  • Telling someone that the type of debt that the Debt Collector is trying to collect cannot be discharged in a bankruptcy.
  • Contacting friends, neighbors and employers and telling them that the consumer owes money.
  • Threatening to seize property.

Any of these actions are violations of the Fair Debt Collection Practices Act.

If you get threatening calls from a Debt Collector, particularly if you have filed a bankruptcy, you need to contact your attorney immediately.

What you should not do is give anyone any bank account information or other personal information.

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Jacoby & Meyers Bankruptcy, LLC: They Went Broke Too!

JacobyMeyersThe law firm of Jacoby & Meyers  which calls itself “America’s Largest Full Service Law Firm” no longer offers bankruptcy services with the filing of an involuntary bankruptcy by its’ creditors. The Involuntary Petition for Chapter 7 bankruptcy was filed on March 14, 2014 naming Jacoby & Meyers, Bankruptcy, LLC.  It was filed in the U.S. Bankruptcy Court, Southern District of New York, Manhattan, and bears case number 14-bk-10641. The LLC was the result of  the 2012 merger of Jacoby & Meyers LLC and Macey Bankruptcy Law PC. LegalZoom.com, Inc. is the major creditor in the involuntary petition claiming in excess of one million dollars of debt.  Legal Zoom has been involved in litigation with Legal Helpers, the name by which the Macey law firm conducted its bankruptcy practice.  The litigation alleges breach of contract and other claims related to an agreement between LegalZoom and Macey under which LegalZoom provided leads to Macey in bankruptcy cases. If you were a client of Jacoby & Meyers Bankruptcy LLC and are wondering what your next step should be, you might want to read the article by Jay Fleischmann entitled:  “Jacoby & Meyers Bankruptcy – 5 Things Their Clients Need To Know”.

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Vince Young Files For Chapter 11 Bankruptcy

Vince YoungFormer NFL Quarterback Vince Young has filed for Chapter 11 bankruptcy in the United States Bankruptcy Court for the Southern District of Texas.

The bankruptcy case was filed on January 14, 2014 in the Houston based bankruptcy court and bears Docket Number 14-30400.

Click on the link below to view the initial filing.

Vince Young’s Chapter 11 Bankruptcy

Young’s financial troubles stem from loans totaling $1.8 million that he took out during the 2011 NFL lockout.  A judgment including interest and attorney’s fees in the amount of $2.5 million was rendered in New York against Young in favor of Pro Player Funding.

A New York state court has granted a judgment against Young to Pro Player Funding, the New York company that made the loan to Young and his associates, which along with interest has grown to more than $2.5 million, a Pro Player attorney told the Chronicle.

Pro Player Funding was in the process of attempting to enforce the judgment in Texas at the time of the bankruptcy filing.

According to Wikipedia, Young was drafted by the Tennessee Titans and was the third overall draft choice in the 2006 NFL Draft.  He spent the first five seasons of his career with the Titans, played for the Philadelphia Eagles in 2011 and started the 2012 season with the Buffalo Bills, but was cut before the start of the 2012 season.

 

 

 

 

 

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Federal Bankruptcy Courts To Stay Open For A Few More Days

Courts Closed

The Government Shutdown is now 10 days old.

In a recent article that I wrote for the Bankruptcy Law Network I discussed how the bankruptcy courts will be impacted by the government shutdown.

In its initial statement regarding the possible shutdown of the Federal Courts, the Administrative Office of the U.S. Courts for the Federal Judiciary advised that the courts would remain open until at least October 15, 2013.

Today, the U.S Bankruptcy Court for the Eastern District of Louisiana announced that they will now be open until at least October 17, 2013.

Should the bankruptcy courts close due to the shutdown, the following results are likely:

  • All hearings will be cancelled.  This is a particular problem in Chapter 13 cases where the payment plan needs to be confirmed by the court.
  • Meetings of Creditors will likely be cancelled.  Without the meeting the discharge of debts in the bankruptcy will be delayed.
  • Although it appears that the Case Management/Electronic Case Filing (CM/ECF) system, which is the Federal Judiciary’s
    national electronic-filing system will likely remain open to accept filings, there will likely be no court staff to process the filings.
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Can I Get Rid Of My Medical Bills By Filing For Bankruptcy?

 

 

Medical Bankruptcy

One of the three major reasons people file for bankruptcy is unpaid medical bills, the other two being job loss and divorce.

Until recently, it was a common practice for hospitals and other health care providers to accept partial, and sometimes very small, payments to pay off medical bills.

Not anymore!

A recent trend, particularly for hospitals is to turn over unpaid medical bills to a collection agency shortly after there is a coverage determination and a balance is due.

Whether uninsured or underinsured, if you have unpaid medical bill you may want to consider bankruptcy as an option.

Medical bills are an unsecured debt and can be discharged in a Chapter 7 bankruptcy, just like a credit card bill.

However, many people think that they can file bankruptcy for their medical bills only.  This is not true.

My friends and co-contributors to the Bankruptcy Law Network, Karen Oakes,  and Brett Weiss have written very through articles entitled:  “Bankruptcy Basics:  What Is A Medical Bankruptcy”  and “Can I File Bankruptcy Just On Medical Bills?” where they point out that medical bankruptcy do not exist and why.

Karen Oakes, Oregon

Karen Oakes, Oregon

To summarize their articles, the general reason that you can’t just get rid of your medical debts is because the Bankruptcy Code requires that all of your unsecured creditors be treated equally and have the same opportunity to share in the distribution of any nonexempt assets that you may have.

The reality is that:

Brett Weiss, Maryland

Brett Weiss, Maryland

  • Few, if any, individuals that file for Chapter 7 bankruptcy will have assets that are non-exempt, so unsecured creditors won’t see any money anyway, medical or otherwise, won’t see any money anyway.
  • A Chapter 7 bankruptcy can only be filed once in an eight year period, so it is very short sighted to not discharge all of your debts when you  file.
  • Even if you don’t list all of your unsecured creditors in your bankruptcy filing, the creditors will learn of the filing anyway and cancel your credit.

Lastly, I do not recommend the filing of a bankruptcy if you, a spouse, or a family member are scheduled for a medical procedure or are pregnant.

It is usually a good idea to wait until after the medical situation is clear before a bankruptcy.  That way, if a serious complication results in a large medical bill you still have the opportunity to discharge the debt.

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