#1 By: Cory Doctorow, January 13th, 2014 09:07
#2 By: Chris Gladish, January 13th, 2014 10:21
RE: The bankrupcy, is there any follow up on this story?
#3 By: Todd Knarr, January 13th, 2014 11:20
And I'd note that the author in this story makes one mistake: saying he doesn't care about the financial details. Those details are important because they're the only thing the judge needs to, or can in fact, care about. And they're decisive, they solidly nail down the payments to the authors as B) ordinary payments in the course of business that wouldn't be considered preference payments at all and B) outside the timeframe where the bankruptcy trustee would be allowed to get them back even if it weren't for A. And from a freelancer's point-of-view that's all that matters: getting this whole thing shut down at the least cost and with the least chance of having the money pulled back. The judge is already mad at the bankruptcy trustee, don't get him mad at you as well.
#4 By: Phillip Hallam Baker, January 13th, 2014 11:46
But as the article said, the court was not allowed to kick out the suits of the people who didn't show up even though they were obviously bogus. And there was no penalty at all for filing the vexatious suits.
That sort of thing does not happen in the UK courts where the loser pays the costs of the winner.
There is no accountability so they will do it again and again.
What the judge could have done is dismissed the claims of the people who showed up and then put the whole case at the back of their queue.
#5 By: Todd Knarr, January 13th, 2014 14:41
Yes. The court can't kick out suits where the defendant doesn't show up, unless the suit has no basis in law. In this case the suit might have a basis if the payment was recent enough, so it requires the defendant to stand up and say "No, the payment was made on this date and that's outside the limit.". As soon as the defendant says that the judge can dismiss the suit, but before that he's got no evidence to support dismissal.
And no, there's no penalty for filing. There is, however, a penalty for failing. If the bankruptcy trustee does this several times, the judge can penalize him in any number of ways. The nicest is to require the trustee to present all the facts about every payment he wants to recall and get the judge's approval to go forward with it. The nastiest is for the judge to invite the defendants to file for costs and fees (he usually can't award them unless the defendant asks, but when the judge invites you to ask for them it's a sign he wants to award them), and since this all happens after the bankruptcy was filed the judgement would go ahead of creditors.
#6 By: Cory Doctorow, January 18th, 2014 09:08
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