Have a civil fraud and theft case against a company that then went into Chapter 11 bankruptcy. While the claims cannot be dismissed, they are saying that the amount is only chargeable at the BK rate, which is very, very low percentage. Less than 20% in this case.
My claim is for more than $100,000. They say the value of it, even if we went to trial would be no more than the 20% payout rate.
We think this is not true, that it is full value. Otherwise someone could do massive, massive fraud and theft, declare bankruptcy, and keep what they stole and only pay at the few percentage rate. Would be strong incentive to commit fraud and theft headng for any bankruptcy.
Chapter 7 Bankruptcy Attorney
It is true, unfortunately. The corporation is not going to pay your claim in full. But that answer only applies to the corporation that filed the Chapter 11. The actual people who defrauded you remain personally liable to you for the full amount and punitive damages also.
You will find the way to recovery is difficult. One way to start is by using the Bankruptcy Court's information to locate the people in the corporation who can tell you who actually perpetrated the fraud and get the documents to help prove fraud was committed.
You will find that "fraud" has a highly technical definition in Bankruptcy Court and also in state courts. And fraud is never easy to prove. You will need a skillful attorney to gather evidence against the individuals involved and then bring a civil action against the individuals involved.
Do not expect an attorney to take your claim on a contingent (percentage) fee. It's way too risky and there will be large up front costs to investigate and prove your claim. Look around for an ex-prosecutor that is now in civil practice. You will also need to find a potential defendant with "deep pockets" to pay your damages if you can prove them. That's very difficult.
If you are willing to invest in the cost of investigating your claim, you may be able to interest an attorney in the facts of your case. These cases rarely pay off, but when they do you can be very well compensated.
The individuals who committed the fraud can also be prosecuted for criminal fraud. But prosecutors really prefer that fraud cases be handed to them on a platter with the evidence stacked high and "beyond a reasonable doubt." If prosecutors are showing no interest now, they are unlikely to show interest in the future. Good luck.
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Disclaimer: Please note that this answer does not constitute legal advice, and should not be relied on, since each state has different laws, each situation is fact specific, and it is impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue. This answer does not create an attorney-client relationship.
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