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Tenacious Service Produces Recovery for Domina Law Group pc llo Client in Bankruptcy Fraud Litigation

Tenacious Service Produces Recovery for Domina Law Group pc llo Client in Bankruptcy Fraud Litigation

When a creditor from outside the area found itself with an uncollectible debt from a commercial business transaction, it contacted Domina Law Group pc llo for collection efforts. The debt, claimed due from a licensed professional person in Lincoln and his spouse, was surrounded by unusual circumstances. The debt, arising from a loan, appeared to have a routine, ordinary course of business basis. It involved refinancing and looked straightforward. But, after the debt was contracted and before lien papers were executed or filed, suddenly a new debt was incurred; it was due to a failed Nebraska bank. The new debt appeared to have no commercial basis, and by “mere coincidence” was in the precise amount of the debt due to Domina Law Group pc llo’s client.

“Something smelled from the beginning,” Brian Jorde of DLGpc observed. “We went to work on it.”

Jorde and Mark Raffety pursued the matter in State Court. The debtor and his spouse filed bankruptcy. There, more unusual things happened. Bankruptcy schedules were irregular and debt did not appear fully disclosed. At best, circumstances were “odd.”

“We insisted we get the information needed to understand these entries,” Mark Raffety said. Jorde added, “We forced production of the tax returns and could see, then, matters didn’t match up.”

“Two or three times along the way our client gave up,” Jorde said. “So, we converted the matter from a unit billing to a contingent fee arrangement in order to make it possible for the client to go forward.”

Domina Law Group pc llo then filed a complaint to deny the debtor’s discharge in bankruptcy. They asserted bankruptcy fraud. “The peculiar circumstances surrounding this arrangement mounted. And as they did, we became more and more convinced something was wrong,” Raffety said.

Trial on the complaint to deny discharge commenced in early August 2010. “We had no choice but to call the debtors as our primary witnesses and make our case through their own mouths,” Brian Jorde explained. “Examination of the debtors did not go well for them. The discrepancies in the timing, entries on the bankruptcy schedules, the tax returns, and in the records of the failed bank were too inexplicable and made too little sense,” Jorde said.

At the end of “an examination obviously very difficult for the debtor,” the case was settled. Jorde and Raffety found their determination paid off.

“Mark and I are pleased to have a client who is delighted to make its point and is making a financial recovery. We hope this effort will deter others from similar conduct, and we know the debtors, who attempted the end run, are chagrined by the outcome, as they should be,” completed Jorde, who conducted the debtor’s examination.

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