Legal Question in Bankruptcy in California

Re: Civil lawsuit moved to Bankruptcy Court

As far as I know, not having read any of the papers in your case nor any underlying contract, the adversary proceeding supersedes the state court civil lawsuit.

If the plaintiff wins, you will have a judgment against you, and your debt won't be discharged in your bankruptcy.

You might be entitled to attorney fees if you win, so be sure and consult an attorney. You should be conducting discovery in preparation for trial.

What happens to your counterclaim or how the statute of limitations affects the adversary proceeding, I have no idea. Bring all the paperwork to an attorney experienced in litigating adversary proceedings in bankruptcy court.

Re: Civil lawsuit moved to Bankruptcy Court

In addition to what Mr. Stone states, your counterclaim is property of the bankruptcy estate. I would hope that you disclosed it to the Trustee, who is the real party in interest. The Trustee might just wish to compromise the whole thing and call it a wash, or even get your BK estate some money to pay off your debts. You might seriously consider amending your petition to include the counterclaim, if it's not already there.