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Hi everyone,
I got into this frustrating, terrible and sudden mess and I thought
maybe someone here can offer some help. Basically, a company I used to
work for as a consultant (named Scient) filed for bankruptcy while I
was working there and now is suing me for the money I made in the 90
days prior to the filing invoking section 547(b) of the bankruptcy
code. This basically says that they can try to redeem any payments
made 90 days prior to the filing. This law is in fact meant to track
down executives who took large amounts of cash when they knew the
company was insolvable and on the verge of bankruptcy. Section 547(c),
however, has a list of exemptions from 547(b) and my payments from
Scient fall under the "normal course of business" category. I called
the lawyer appointed by the court (the one suing me) and he seemed a
little surprised I was an individual who was also a contractor. I also
talked to other lawyers and, legally, this suit can be filed but it
would never hold in court. The problem is that until I get this
dismissed the legal fees (if charged by the hour) will be astronomical
and everyone so far says I should settle. However, I will rather file
for bankruptcy myself than give these guys a dime, this whole thing is
ridiculous and unfair in my opinion... They also served me the summons
late (3 days ago - on 09/16/2003 - while the lawsuit was filed on
07/02/2003) and there is a court hearing on 10/01/2003 so I'm assuming
this has to be illegal - shouldn't I be notified well in advance?
Anyway, here's my case: I was employed by Scient on March 16th to be a
consultant for their last account in Boston - Boston Coah, a Fidelity
company. I was billing my hours to the account manager, who was
approving each invoice, signing it and submitting them to accounting.
2 weeks later I would receive the payment for it. Scient would then
bill my hours to the client at a higher rate. My last invoice, hasn't
even been paid (due to the filing) and I have a claim for that in the
bankruptcy court. Maybe this can be part of the settlement (if I have
to go for one which, as I said, I'd rather not)? I have all the
invoices, pay stubs, 1099 they gave me an an employment contract that
should pretty much prove I got paid as part of the normal course of
business.
Here's another twist - is there anyone I can counter-sue in this case?
I would love to see these bastards along with the fat executives who
were expensing anything from $0.69 donuts to plane tickets to
Singapore and Milan brought under the public eye. One lawyer I talked
to said something about extorsion and abusing the law but we never
went into more detail. Of course, the priority is to get cleared of
this moronic lawsuit...
Please feel free to contact me directly at 617-319-0940 or email me at
sergiuv@hotmail.com
Thanks,
Sergiu
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Sergiu,
If your expertise is computers it may be that you do not have the
requisite expertise to represent yourself legally in a bankruptcy hearing.
You need to speak with someone who has the necessary expertise and perhaps
hire someone to advise and represent you. Since the hearing you refer to is
on Oct. 1st looking for advice on the internet is perhaps a waste of very
limited time. Call and speak to lawyers on Monday. Since you're a contractor
perhaps the lawyers who helped you set up your business and advised you on
contract language can recommend someone.
You , quite rightly, mention cost. Find out if defending your earnings is
what is necessary, what the cost of this defense will be, what the cost of
failing to defend will be, and calculate what your earnings to date are.
Based on this information you can come up with a plan.
I won't engage in speculating on whether it is appropriate to sue you for
your documented work or respond to your comments about "fat executives". You
need to focus on getting trustworthy advice on your rapidly approaching
court date.
Good luck,
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I won't engage in speculating on whether it is appropriate to sue you for
your documented work or respond to your comments about "fat executives". You
need to focus on getting trustworthy advice on your rapidly approaching
court date.
You're right, I am in the process of contacting lawyers and assesing
the potential costs. You have to understand how frustrating this is
for someone who worked for the money (and also paid taxes). I was also
hoping to find someone who maybe went throught the same thing...
Thanks,
Sergiu
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A couple of hints: you might not be a contractor at all. While you did
not provide enough information to judge (or else I read your posting
too fast to see), the firm (or any contractor between you and the firm
in bankruptcy) is at risk of being attacked by the IRS for not
treating you as an employee and deducting FICA and FUTA.
If you are not an insider and what you received is wages, or an amount
comparable to wages and benefits of an employee, the trustee in
bankruptcy has zero chance of recovering it from you as a preference
or anything else.
You might contact the US Trustee (responsible for supervising Chapter
11 cases in all but 2 states), and see what their thoughts are.
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Thanks for all the suggestions. I did call the US Trustee for NY but
they do not mediate such legal issues. He did say sometimes
court-appointed lawyers file lawsuits in bulk to see who bites.
In the meantime I got myself an extension till October 23rd and also
contacted the bankruptcy court's lawyer agaain. I said I have no
representation yet and offered to settle. He said I should put
everything in the mail which I did. I said I would drop my claim
against the company (I have one with the bankruptcy court since they
haven't paid my last invoice) and pay $2000 to cove rfor their legal
costs. It's a ripoff in my opinion but if they take it it'll save me a
lot of headaches...
Sergiu
A couple of hints: you might not be a contractor at all. While you did
not provide enough information to judge (or else I read your posting
too fast to see), the firm (or any contractor between you and the firm
in bankruptcy) is at risk of being attacked by the IRS for not
treating you as an employee and deducting FICA and FUTA.
If you are not an insider and what you received is wages, or an amount
comparable to wages and benefits of an employee, the trustee in
bankruptcy has zero chance of recovering it from you as a preference
or anything else.
You might contact the US Trustee (responsible for supervising Chapter
11 cases in all but 2 states), and see what their thoughts are.
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sergiuv@hotmail.com (Sergiu Vlad) wrote in message news:<27ac06ba.0309241109.59eb0c04@posting.google.com>...
In the meantime I got myself an extension till October 23rd and also
contacted the bankruptcy court's lawyer agaain. I said I have no
representation yet and offered to settle. He said I should put
everything in the mail which I did. I said I would drop my claim
against the company (I have one with the bankruptcy court since they
haven't paid my last invoice) and pay $2000 to cove rfor their legal
costs. It's a ripoff in my opinion but if they take it it'll save me a
lot of headaches...
I don't think you should pay anything. I think you should get the NY
State labor board to take up your case for free.
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I don't think you should pay anything. I think you should get the NY
State labor board to take up your case for free.
I thought so as well and emailed them. However, they said that since I
was a consultant (and not an employee) they can't do anything. Also,
since I worked in Boston it's out of their jurisdiction. I will try to
email the Boston labor board and see what their take on it is...
Sergiu
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sergiuv@hotmail.com (Sergiu Vlad) wrote in message news:<27ac06ba.0309200809.e0cdbb6@posting.google.com>...
Hello,
Cyril Here, I can't follow totaly but I think you need legal
representation it seems that the company you worked for is betting
that you won't be able to follow through with the filing, but you can
have a Top Of The Line Law Firm on your side in court (Given 5 days
notice) and help you review dcuments and give you unlimited legal
advice.
Membership for less than the price of a cup of coffee,
a day $26.00 or less a month.
Membership
www.prepaidlegal.com/info/craven11
Business Opportunity
www.prepaidlegal.com/go/craven11
Hi everyone,
I got into this frustrating, terrible and sudden mess and I thought
maybe someone here can offer some help. Basically, a company I used to
work for as a consultant (named Scient) filed for bankruptcy while I
was working there and now is suing me for the money I made in the 90
days prior to the filing invoking section 547(b) of the bankruptcy
code. This basically says that they can try to redeem any payments
made 90 days prior to the filing. This law is in fact meant to track
down executives who took large amounts of cash when they knew the
company was insolvable and on the verge of bankruptcy. Section 547(c),
however, has a list of exemptions from 547(b) and my payments from
Scient fall under the "normal course of business" category. I called
the lawyer appointed by the court (the one suing me) and he seemed a
little surprised I was an individual who was also a contractor. I also
talked to other lawyers and, legally, this suit can be filed but it
would never hold in court. The problem is that until I get this
dismissed the legal fees (if charged by the hour) will be astronomical
and everyone so far says I should settle. However, I will rather file
for bankruptcy myself than give these guys a dime, this whole thing is
ridiculous and unfair in my opinion... They also served me the summons
late (3 days ago - on 09/16/2003 - while the lawsuit was filed on
07/02/2003) and there is a court hearing on 10/01/2003 so I'm assuming
this has to be illegal - shouldn't I be notified well in advance?
Anyway, here's my case: I was employed by Scient on March 16th to be a
consultant for their last account in Boston - Boston Coah, a Fidelity
company. I was billing my hours to the account manager, who was
approving each invoice, signing it and submitting them to accounting.
2 weeks later I would receive the payment for it. Scient would then
bill my hours to the client at a higher rate. My last invoice, hasn't
even been paid (due to the filing) and I have a claim for that in the
bankruptcy court. Maybe this can be part of the settlement (if I have
to go for one which, as I said, I'd rather not)? I have all the
invoices, pay stubs, 1099 they gave me an an employment contract that
should pretty much prove I got paid as part of the normal course of
business.
Here's another twist - is there anyone I can counter-sue in this case?
I would love to see these bastards along with the fat executives who
were expensing anything from $0.69 donuts to plane tickets to
Singapore and Milan brought under the public eye. One lawyer I talked
to said something about extorsion and abusing the law but we never
went into more detail. Of course, the priority is to get cleared of
this moronic lawsuit...
Please feel free to contact me directly at 617-319-0940 or email me at
sergiuv@hotmail.com
Thanks,
Sergiu
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