Practice pointer 2.0: bankrupt plaintiffs
Not too long ago we advised that it’s a good idea to check whether your plaintiffs were actually alive when they filed their suits. We’d like to amend that to add that it’s also a good idea to check whether your plaintiffs were financially alive as well.
By that, we mean plaintiffs should be checked for bankruptcy filings. The quite lengthy and well-reasoned opinion in Fair v. Biogen IDEC, Inc., 2012 WL 2417722, slip op. (Mass. Super. June 13, 2012), explains why. If a plaintiff has an accrued but unfiled personal injury claim and does not list it as an “asset” in a personal bankruptcy, then it passes to the bankruptcy estate as property and the plaintiff loses standing to assert it. Fair, slip op. at 12-13. In addition, or in the alternative, to the no-standing rule, a plaintiff who omits an unfiled personal injury claim from his/her list of assets in bankruptcy is judicially estopped from pursuing it following discharge in bankruptcy. Id. at 14.