October 8, 2008 11:24 AM EDT
Just a bit of warning and not legal advise.. cost us $25k to learn it. Corp officers called us and then contracted for out services. Said "we need some help as having difficulty" We performed as contracted but noticed they seem to be dancing a bit. Pay in full and one month later got a notice, "we are filing for CH 11" but not to worry. We DID NOT worry as had been paid.
Nearly year later, Bankruptcy Court (800 miles away) summons and you are guilty of CH11 Para 547C and we want our money back etc". So we called a local lawyer. he told us, can do it for $20K down, will run more, plus expenses. Then tried lawyer in Court town, told $25K down and will cost more but you will probably loose! Did www search and found name of firm there we knew that was also in it. He said "my brother a lawyer, told me to negotiate payment as even at his costs would run more then asked and will lose anyway"
So we tried to go Pro Se. We were stunned at how the Fed Bankruptch Ct operates. Seems there is criminal, civil and Bankruptcy Courts and the latter offers NONE of protections of civil of criminal.. and lawyers making billions of it .. and all others need not apply.
To make long story short. did not matter the corp called us for services or such. We got paid inside the 90 day window where the corp can go back and take money back to pay other creditors.. and THAT is the law, If you have inventory there. some limited protections. IN the end wrecked our small business..and it will cost most more to fight then pay.
YOU ON WWW can end up in the court they file in, downtown or 3000 miles away. This thing is a horror..and congress wrote it as they were told by lawyers and corp usa.. There seems NO defense to protect self as a corp way far away owns your client, they go down, you got paid, you get tagged The company you deal with has NO obligation to tell you they are in KEYWORD :"Court restructuring" which is road to CH11. and "restructuring" is a word tossed all about.. so never know what it means. If you want look up CH11 P547c. in plain english means. We will take back what we paid if done within 90 days, and tough for you.
NOTE wrote congress about this outrage.. ZERO response. So with econ in dumps. be REAL careful.. but that 90 day thing and flowdown from main corp to others can bite you.. as you may not even know the big one filed 11 and the one you deal with are part of it.. Good luck.but be warned. it bites..