Legal Question in Bankruptcy in Illinois

You can file a lawsuit, but I would advise you not to. The proper venue for your lawsuit may be in bankruptcy. Bankruptcy law provides for the filing of what is known as an "Adversary Complaint". Usually, in a bankruptcy, a corporations assets are either liquidated to pay creditors (Chapter 7) or the company's assets are reorganized and a payment plan is proposed (Chapter 11). Most likely, in a Chapter 7, your chances of recovering anything are slim. In a chapter 11, you will likely not receive full value; average recovery usually comes in around 30-40%. AN EXCEPTION TO ALL OF THIS is the Adversary Complaint. In short, if a creditor can prove that the debt was incurred via fraud (such as, for instance, where a company ordered goods it clearly had no intention of paying for), that debt will become known as "non-dischargeable". That is, the bankrupt company will have to pay the debt in full, irrespective of what it may propose under, say, a plan of reorganization. Somewhat complicated area of law here. Feel free to email me if you have any further questions; [email protected] Thanks.