QUESTION

What can be done if the harassment suit is being halted by the employer's bankruptcy case?

Asked on Apr 23rd, 2014 on Labor and Employment - California
More details to this question:
I have an active civil rights suit for harassment and discrimination against my former employer. My attorney is requesting to be dismissed as my rep as she does not have experience in bankruptcy law. My employer was aware of my claims in Sept 2012 when the Civil Rights Commission began its investigation (the first incident of harassment occurred in June of 2011, the continued actions were reported to HR around January 2012, and I was constructively discharged in March 2012). The commission 'ruled' in my favor and granted me the right to sue and request a jury trial (which my attorney preceded with both). However, in a communication to my attorney, opposing counsel said the following: "while the automatic stay remains in place, we learned late yesterday that the bankruptcy court also approved the bankruptcy plan as of December XX, 2013. In accordance with the terms of the approved bankruptcy plan, Ms. XXXโ€™s claims against [former employer], [the parent company], and all former and current employees of Debtor - including [the accused executive manager] and [dept. manager] - constitute 'released claims.' Ms. XXX is therefore permanently enjoined from continuing any action against any of these defendants on the basis of such released claims." I need to know if this statement is entirely correct. I also need to know whether my attorney should have known, or opposing counsel should have advised, sooner that certain actions needed to be taken previous to this point in the bankruptcy in order to protect my rights and interests. Opposing counsel is requesting I sign an affidavit, voluntarily dismissing my claims, to avoid motion practice. I do not think that I should sign, as it indicates I would be doing so with prejudice and on the merits, and as I understand it, this means that I cannot pursue any further action against them in the future, as they are forever released from any liability. I do not want to concede, but they advised my attorney if I do.
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3 ANSWERS

I do not practice bankruptcy law, so I am unable to answer this question. Bankruptcy filings stay certain procedures, including pending law suits. It is possible the bankruptcy court will lift the stay, and permit the suit to proceed, but I do not know if that is likely to happen or not.
Answered on Apr 29th, 2014 at 8:48 AM

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Labor and Employment Litigation Attorney serving Beverly Hills, CA at Thomas & Associates
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You should have sought relief from the automatic stay; it may be too late to do that now.
Answered on Apr 25th, 2014 at 5:47 PM

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Commercial Contracts Attorney serving Boise, ID at Peters Law, PLLC
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Sorry, you are out of luck. The defendant had no duty to tell you of the impending bankruptcy and your attorney only had a duty to represent you in the discrimination claim. Since your claim has been released in bankruptcy, it no longer exists. Thus you see what other creditors face when bankruptcy occurs.
Answered on Apr 25th, 2014 at 5:47 PM

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