EXTREMELY unusual administered Chapter 7 by Panel Trustee

[DNV]

Facts: I filed 2/23/2005 voluntary, non-consumer no asset Chapter 7. On the schedules, the listed assets included: a) malpractice action (stayed in another jurisdiction's state court) against attorneys and law firm related to an accounting action re LP/LLC 1/7th interest e.g. unknown FMV on 2/23/2005, although extrinsic evidence of valuation from 2000; b) assertive actions against accountants and law firm/attorneys representing LP/LLC; c) assertive actions against other professionals and LP/LLC as an entity and members. There was no consumer debt, Sallie Mae was only potential creditor other than attorneys pursuing payment for legal fees, but facing stayed malpractice action in another jurisdiction. I asked my attorney of record to "reaffirm" Sallie Mae, and made my request within first 4 months after filing on 2/23/2006. He refused to make motion to reaffirm the Sallie Mae. I was given a standard discharge in 8/2006. I was told that no creditors claims had been submitted to the trustee prior to discharge in 8/2006. In October, 2006, after I questioned panel trustee about 1/7th interest, I received in mail a "Notice of Discovery of Assets" from/signed by same panel trustee. When I called attorney of record, the comment made was "it was a mistake, I'll get back to you". I never heard back from said attorney. I e-mailed panel trustee by 12/2006, asking about this notice of discovery of assets and again questioning the 1/7th Lp/LLC interest. Panel trustee suddenly hires a law firm, and tells me to speak to my attorney of record - who of course does not return my phone calls or e-mails. I sent a letter to panel trustees law firm asking as to why no turn over proceeding occured nor subpoenas related to LP/LLC etc. and accounting etc etc. MOnths past, panel trustee removed, and new one replaced that first panel trustee- but later discover panel trustee #2 has close personal working relationship with
panel trustee #1's law firm. Only upon removel of panel trustee #1, do I learn
that there existed postd discharge a claim submitted by Sallie Mae (although not necessary bc/ pre-discharge I accelerated payments and reaffirmed by actions of huge payments) and then a claim by the law firm , against whom existed in a stayed state court in another jurisdiction a malpractice action.

In the end, the case terminated after much fighting with panel trustee #2, with a return to no asset, and comment on PACER that no distribution occurred. I forced Sallie Mae to withdraw their claims submitted post discharge bc/predischarge, I reaffirmed by acts. The claims by the attorneys were withdrawn e.g. they allegedly went away when fraud was discovered on
their claims submitted post discharge @ 2/2007 (discharge occured 8/2006).

QUESTION: The BK as a whole was terminated and closed on 1/6/2009, and allegedly my assertive claims and malpractice claims were abandoned to me by panel trustee #2. That said, there is no transparency from the Court or
panel trustee #2 what releases if any were given by him/her related to post-discharge claims. When, panel trustee #2 closed the docket, they listed the case as a "consumer" (rather than non-consumer) no asset BK, even though
the only reason Chapter 7 was filed related to claim for fees from attorneys
against whom I had a malpractice action. I asked panel trustee #2 to correct on PACER and on the official record. I was forced to go to U.S. Trustee from DOJ bc/ no answer from panel trustee (now discharged), and I am not receiving an answer from DOJ. My concern is that I have SOL's relevant to abandoned claims, and attorney representing me in that jurisdiction wherein exists malpractice action against pursuing attorneys and assertive claims relevant to LP/LLC 1/7th needs to know scope of releases provided by either trustee # 1 or #2. I need to have it on the public record it was a non-consumer BK, Chapter 7 to avoid implication of "bad faith and abuse" implication. I need to take a tax loss due to fraud or other (either capital or ordinary loss) on the 1/7th - the trustee did not do a turn over nor obtain any information relevant to the assets or FMV in the "estate". My hands are tied. I believe there many have been some interference and potential payoffs to either one of the trustees or my former counsel of record. I am on the verge of gong to U.S. attorneys or FBI. Before I do that step, is there a motion one can make before prior sitting judge, if the DOJ's U.S. trustee refuses to answer narrow good faith questions. Was this bk handled strangely? I have no expertise.

[fltoo]

I am so sorry to say this, but I cannot even read your post due to no paragraph breaks. Must be my old eyes.

[TEW]

I am so sorry to say this, but I cannot even read your post due to no paragraph breaks. Must be my old eyes.

yeah

[eddiep]

I don't undersand a thing you just said

[debtmonster]

Me neither.

[HHM]

That is a whole lot of nothing.

As much as you typed, it doesn't even begin to give us the context of your BK.

[SubPrimeME]

I think if you just ask one question or provide one small example, we could help more, but I spent a lot of time re-reading your post and was truly confused. Try to make it as simple as possible....

[dingdong]

Ok, break it down a bit more coherently and you may get help

1)the only reason Chapter 7 was filed related to claim for fees from attorneys

2)"accounting action re LP/LLC 1/7th interest e.g. unknown FMV on 2/23/2005"

#2 is a potential asset?

3) "There was no consumer debt, Sallie Mae was only potential creditor other than attorneys pursuing payment for legal fees, but facing stayed malpractice action in another jurisdiction"

So, were you BK-ing the legal fees from the malpractice lawsuit that was/(you) filed?

"Only upon removel of panel trustee #1, do I learn
that there existed postd discharge a claim submitted by Sallie Mae (although not necessary bc/ pre-discharge I accelerated payments and reaffirmed by actions of huge payments) and then a claim by the law firm , against whom existed in a stayed state court in another jurisdiction a malpractice action."

Sallie Mae filed a claim, moot point, you are paying them

Attorney in the malpractice suit filed a claim, due to the potential assets in the same suit that you used him for or.. was it the opposing attorney?

"The BK as a whole was terminated and closed on 1/6/2009, and allegedly my assertive claims and malpractice claims were abandoned to me by panel trustee #2. That said, there is no transparency from the Court or
panel trustee #2 what releases if any were given by him/her related to post-discharge claims. When, panel trustee #2 closed the docket, they listed the case as a "consumer" (rather than non-consumer) no asset BK, even though
the only reason Chapter 7 was filed related to claim for fees from attorneys
against whom I had a malpractice action."

"My concern is that I have SOL's relevant to abandoned claims, and attorney representing me in that jurisdiction wherein exists malpractice action against pursuing attorneys and assertive claims relevant to LP/LLC 1/7th needs to know scope of releases provided by either trustee # 1 or #2. I need to have it on the public record it was a non-consumer BK, Chapter 7 to avoid implication of "bad faith and abuse" implication."


Why would it be considered fraud if it listed as a consumer BK, vs Non Consumer BK?

Does your original petition state it is a non-consumer BK filing?

Can you first call the clerk at the court and see if it is possibly a clerical error?

Then perhaps you can motion the court to ammend to reflect your original filing.

Honestly, I have no idea, but thought you might get more help if you divy-ed up your post in a more readable manner.

Call your case manager and ask why it was changed to a consumer filing, maybe they will have a straightforward answer for you.

[wonkettegirl]

Can you translate your post into bullet points, maybe? I can't make heads or tails out of it.

[jeb]

That is a whole lot of nothing.

As much as you typed, it doesn't even begin to give us the context of your BK.

I think it is a joke - I hope it is a joke! - jb

[SubPrimeME]

Ok, break it down a bit more coherently and you may get help

1)the only reason Chapter 7 was filed related to claim for fees from attorneys

2)"accounting action re LP/LLC 1/7th interest e.g. unknown FMV on 2/23/2005"

#2 is a potential asset?

3) "There was no consumer debt, Sallie Mae was only potential creditor other than attorneys pursuing payment for legal fees, but facing stayed malpractice action in another jurisdiction"

So, were you BK-ing the legal fees from the malpractice lawsuit that was/(you) filed?

"Only upon removel of panel trustee #1, do I learn
that there existed postd discharge a claim submitted by Sallie Mae (although not necessary bc/ pre-discharge I accelerated payments and reaffirmed by actions of huge payments) and then a claim by the law firm , against whom existed in a stayed state court in another jurisdiction a malpractice action."

Sallie Mae filed a claim, moot point, you are paying them

Attorney in the malpractice suit filed a claim, due to the potential assets in the same suit that you used him for or.. was it the opposing attorney?

"The BK as a whole was terminated and closed on 1/6/2009, and allegedly my assertive claims and malpractice claims were abandoned to me by panel trustee #2. That said, there is no transparency from the Court or
panel trustee #2 what releases if any were given by him/her related to post-discharge claims. When, panel trustee #2 closed the docket, they listed the case as a "consumer" (rather than non-consumer) no asset BK, even though
the only reason Chapter 7 was filed related to claim for fees from attorneys
against whom I had a malpractice action."

"My concern is that I have SOL's relevant to abandoned claims, and attorney representing me in that jurisdiction wherein exists malpractice action against pursuing attorneys and assertive claims relevant to LP/LLC 1/7th needs to know scope of releases provided by either trustee # 1 or #2. I need to have it on the public record it was a non-consumer BK, Chapter 7 to avoid implication of "bad faith and abuse" implication."


Why would it be considered fraud if it listed as a consumer BK, vs Non Consumer BK?

Does your original petition state it is a non-consumer BK filing?

Can you first call the clerk at the court and see if it is possibly a clerical error?

Then perhaps you can motion the court to ammend to reflect your original filing.

Honestly, I have no idea, but thought you might get more help if you divy-ed up your post in a more readable manner.

Call your case manager and ask why it was changed to a consumer filing, maybe they will have a straightforward answer for you.

Bless you for trying to translate... can the OP come back here and simplify?

[dingdong]

Bless you for trying to translate... can the OP come back here and simplify?

Thank you!

My mind was going WTF? But my competitive side was saying, maybe you can figure this out, I don't mind a challenge! Plus, I like to give people the benefit of the doubt and maybe the poster OP really needed help.

Still really confusing! Jeeze!

I would never want to get the FBI involved in any part of my life, but everyone dances to their own music.

[DNV]

Breaking it Down

Original writer apologizes for not "breaking it down" more concisely....1) the entire EDNY bk was related to an Ohio family corporation and its related LP/LLC holding real estate etc. in which writer has/had 1/7th interest which was subject to an accounting action in a state court in Ohio; 2) the legal fees driving writer into Chapter 7 in EDNY, without any results in the Ohio accounting action, and 3) with identifiable malpractice by the Ohio attorneys in the Ohio action.

In essence, pursuing a mere accounting drove writer debtor into Chapter 7, and with no results in that Ohio action of obtaining an accounting or anything such as FMV for writer debtors' 1/th LP/LLC.

There was no consumer debt at time of 2/2005 EDNY BK filing. Other than legal fees claimed post discharge (8/2006) by the Ohio attorneys against whom there existed a stayed malpractice claim, there were no claims against debtor. This was a victimless bankruptcy filing, voluntary done to pursue the malpractice claim in EDNY in NY if the Ohio attorneys came to the EDNY jurisdiction from Ohio and submitted a claim, rather than pursue it in Ohio state courts - which was juiced in their favor due to local control.

The important point being that the results in the underlying Ohio accounting action were nothing, not even an accounting. The opposition in that Ohio accounting action drove the litigation hard simply to avoid producing the accounting and FMV of writer debtor's 1/7th LP/LLC interest. Their driving the litigation hard drove the writer debtor forseeably into BK. By operation of law and the terms of the LP/LLC operating agreement, writer debtos was forced out of the LP/LLC e.g. constructively forced to abandon the 1/7th interest in the LP/LLC against the writers' debtor's will, and thus never collecting anything for their 1.7th LP/LLC interest. THIS IS PROVIDED MERELY FOR CONTEXT.

On breaking my original questions "down":
A) On the issue of writer debtor not being told by panel trustee case manager if he/she provided releases to the Ohio attorneys against whom a stayed malpractice action existed in Ohio state court (said same attorneys had the guts to submit a claim to EDNY BK court post discharge(8/2006) in 10/2006), I researched and discovered that aside from writing the DOJ itself (which I did already), the panel trustee had to file a "UST-Form 101-7 NDR",
UST-Form-101-7-NFR" and a UST-Form 101-7-TDR" with the Office of U.S. Trustee and the EDNY Bk court. Those forms require statements certified as to 1) legnth of time case pending; 2) assets abandoned; 3) assets exempted; 4) claims asserted; 5) claims scheduled; 6) claims dismissed without payment. In my case, no claims were paid period by the panel trustee. Sallie Mae's claims filed post disharge was mooted by my having reaffirmed that non-dischargeable debt throughout the pendency of the BK.
The Ohio attorneys' (against whom I had a malpractice action stayed in an Ohio Court) were not paid anything. But I have not been informed if
the panel trustee merely dismissed the Ohio attorneys claim, or whether my
stayed Ohio malpractice action(added on the EDNY BK schedules) was abandoned to me, or if somehow other agreements were reached with the trustee and the trustee gave them releases. I need to know this information
for purposes of SOL in the OHio state court, where that Ohio malpractice action was stayed.

B) As to issue of labeling of case as consumer, rather than non-consumer, I will pursue with the Clerk of Courts in EDNY how to see it changed to reflect properly it was a non-consumer case. if that doesn't work, I will motion the court for a correction to the docket.

C)The issue of U.S. attorneys or FBI arose simplly bc/ the trustee was sent information that identified the existence of assets and which led to the post discharge Notice of Discovery of Assets letter, post discharge. There was no turnover proceeding, nor identification of precisely what assets that notice referred to. But, post discharge, I learned that the trustee was going to pay claims to the Ohio attorneys without allowing me to pursue the malpractice action against them, and was going to do so without ever informing me
claim had been submitted by them post discharge. Without speaking to me
or garnering any facts, the trustee was going to merely pay them off from assets about which I knew nothing, and take away my malpractice action, denying me any due process to see their claim denied.

D) When I demanded from the EDNY trustee documentation clarifying just what assets were discovered, they would not tell me, yet they told me I would not receive any money for my 1/7th LP/LLC interest - even though apparently they were going to pay the Ohio attorneys from something they considered to be my asset (something about which I know even today nothing). I then said if I don't own any assets, how are you going to pay them. I then said, I had an asset, which I no longer have apparently, and that is a loss. Therefore, I need documents to give the IRS to take a loss. They refused to secure said documentation for me to take the loss.

In essence, it appears there was some funny business going down here. The trustee knew about it, and my former NYC Bk attorney(fired) knew about it.
NO one spoke to me at all throughout the almost 4 years of a BK, one that
was discharged standardly in 8/2006, revived by a notice of discovery of assets (never clarified as to what it was) in 10/2006, and one that never provided me any information to entitle me to take a ordinary or capital loss for
almost $250,000-$280,000 (FMV in 2000 of my 1/7th interest). There was no turnover proceeding, no subpoenas sent out etc etc.

The trustee was going to take $25,000 from the Ohio accountants and LP/LLC attorneys if she provided them with releases, so that impliedly
they'd never have to give me documentation to take a loss.

I am left empty handed, frustrated, and yet told claims I included as part of my estate were abandoned to me, but the trustee is not providing me infomration on what releases if any she gave - since if she provided releases, my claims abandoned to me would be sabotaged.

I hope this is clearer.
documentation

[jktrading]

Sorry, you couldn't make less sense to me.

[dingdong]

I kind of get it, basically you need something from the Trustee that shows you took a loss on your interest in the LLC so you don't have to pay taxes.

You can't get any help from the UST and you think there was some shenanigans between your lawyer and the Trustee.

You are getting info that there were some assets in your BK, the LLC, but you can't get a valuation of the assets from the Trustee. THerefore no info for the IRS.

Is that kind of it in a nutshell?