Medical Malpractice Claims, Bankruptcy and Bankruptcy Trustees

07 Feb Medical Malpractice Claims, Bankruptcy and Bankruptcy Trustees

If you are filing a bankruptcy case because of massive medical bills while you are pursuing a major medical malpractice claim, you have opened quite a kettle of fish.

It is very important that you tell your bankruptcy attorney all about your medical malpractice case. To see why, click here.

The Cast of Characters

  • Your bankruptcy attorney
  • Your medical malpractice trial attorney
  • The opposing medical malpractice defense attorney
  • The bankruptcy trustee
  • Your creditors in your bankruptcy case

Each of these players have quite a bit of interest in both your bankruptcy case as well as your medical malpractice case.

You must disclose the medical malpractice case in your bankruptcy papers. You also want to claim any exemption to which you might be entitled.

The bankruptcy trustee has the right to pursue that bankruptcy case in your name

The bankruptcy trustee will want to work closely with your medical malpractice attorney

The defense attorney will take advantage of any failure to disclose the medical malpractice claim in your bankruptcy case.

Points to remember:

  • Your medical malpractice claim might be worth more than the claims in the bankruptcy estate
  • If that’s true, then the bankruptcy trustee can’t settle the case without your permission and authority. If he tries to do that, you need to scream bloody murder
  • It’s better to work cooperatively with the trustee through your medical malpractice attorney to get the largest recovery possible.
  • Remember that many of the claims in your bankruptcy case might be medical bills which will be covered by the medical malpractice claim or settlement.
  • Don’t sell your medical malpractice claim to scam artists who want to buy it in advance on the cheap.


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Jay S. Fleischman is a bankruptcy lawyer with offices in Los Angeles and New York. He can often be found on Google+ and Twitter, where he shares information about consumer protection issues and personal finance.
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