The United States Supreme Court has agreed to hear a bankruptcy case that will define precisely what “fraud” means under the Bankruptcy Code. The law doesn’t allow you to discharge a debt if you obtained the money fraudulently. The Supreme Court will decide if fraud means only outright lying, or if other actions may also constitute fraud in the context of bankruptcy. In the Dallas-Fort Worth area, before you decide on bankruptcy, obtain the advice and services of an experienced Dallas bankruptcy attorney. Then follow that attorney’s advice. If a man named Daniel Lee Ritz had followed the advice of a good bankruptcy lawyer, the Supreme Court probably would not be hearing his case.
Ritz owned Chrysalis Manufacturing. Chrysalis purchased $164,000 worth of goods from Husky International Electronics between 2003 and 2007. During that four-year span, Chrysalis never paid for the goods, and Ritz funneled more than $1 million of Chrysalis’s funds to other companies under his control. When Husky sued to hold Ritz personally liable for the Chrysalis debt, he filed for chapter 7 bankruptcy to take himself off the hook for the debt Chrysalis owed Husky. Husky argued that Ritz should pay the debt because he defrauded Husky by moving Chrysalis’s funds out of its reach. The problem is that Ritz never actually lied to Husky. The Supreme Court will determine if Husky was or was not legally a victim of fraud and if Ritz will be required to pay the debt he owes or allowed to discharge it.
If you are struggling with debts that you can’t pay in the Dallas-Fort Worth area, it’s better to speak first with a good bankruptcy lawyer and adhere to that lawyer’s advice before you start transferring funds and trying to protect yourself from creditors. An experienced Dallas bankruptcy attorney will make sure that your rights are protected and that you receive the maximum protection from creditors that the law allows. If you believe that bankruptcy may be your only alternative, make the call to a Dallas bankruptcy attorney immediately.