Bankruptcy can be a powerful and effective solution to debt problems for both individuals and businesses. Individuals who are facing creditor harassment, debt collection attempts, lawsuits, foreclosures, repossessions, and other debt issues can file bankruptcy to get a fresh start. Typically, most individuals file bankruptcy under either Chapter 7 or Chapter 13 of the bankruptcy code. In a Chapter 7 case, dischargeable debts, such as money owed on credit cards or medical bills, can be eliminated, though not all debts can be eliminated in Chapter 7 bankruptcy. Chapter 7 bankruptcy is a good option for certain people depending on their financial situation, assets, and other factors. If Chapter 7 bankruptcy is not a good option, then Chapter 13 bankruptcy could be an appropriate solution. In Chapter 13, a person enjoys the powerful protections of the bankruptcy code while paying back some portion of their debts over three to five years. In some cases, high income individuals may file Chapter 11 bankruptcy when neither Chapter 7 or Chapter 13 would provide the right answer to their debt problems. Businesses can also file bankruptcy. For a business, Chapter 11 bankruptcy provides an opportunity to reorganize the finances of the business, and Chapter 7 bankruptcy is a means of having a court appointed trustee liquidate the assets of the business.
Bankruptcy litigation cases involve a wide variety of different parties, such as the debtor who filed bankruptcy, his creditors, and a court-appointed trustee, who have competing interests in the bankruptcy case. Bankruptcy litigation can also concern the rights of people or businesses who have previously bought property from the debtor or are seeking to buy the assets of the debtor. In any case, the bankruptcy court will attempt to resolve the disputes between these various parties. Many times these disputes concern preferential and or fraudulent transfers, lien avoidance, or the proper valuation of assets. However, sometimes these disputes are more complex and deal with other areas of the law, such as patents or trademarks. In any case, bankruptcy litigation counsel will advise their clients and negotiate, prosecute, and/or defend in the proceeding depending on the situation.