Nashville, TN asked in Bankruptcy for Utah

Q: If a company files a chapter 13 can a class action suit still be brought upon them?

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1 Lawyer Answer
Zaven Andranik Sargsian
Zaven Andranik Sargsian
Answered
  • Bankruptcy Lawyer
  • Salt Lake City, UT
  • Licensed in Utah

A: Whether an action can be brought against a company that has filed for bankruptcy will depend on how you answer a number of questions. One is whether the plaintiff wants the action to be brought in district court or as an adversary proceeding (roughly a "litigation on the side") in the bankruptcy court? If you want to bring an action in the district court then there generally needs to be several documents filed including a motion for relief from the automatic stay, an adversary proceeding complaint to determine dischargeability, a district court complaint, and a motion to stay the adversary proceeding. If litigating the case in the bankruptcy court as a "litigation on the side" is acceptable to the plaintiff then the plaintiff needs, at least, an adversary proceeding complaint to determine dischargeability.

Note that an adversary proceeding cannot be brought for any claim (so it will depend on what exactly you claim the company is liable for). Bankruptcy law is very complicated, and involves various rules, statutes, and court opinions. Indeed, attempting to bring a "class action" will itself raise several issues. I would strongly suggest you contact a lawyer here in Salt Lake City, or elsewhere if you prefer.

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