The Miami Herald published this article about my analysis of the 50 Cent Bankruptcy filing.

Source: http://markets.financialcontent.com/mi.miamiherald/news/read/30490891/Chicago_Bankruptcy_Expert_Brian_P._Deshur_Shares_His_2_Cents_on_the_50_Cent_Bankruptcy_Case

Chicago Bankruptcy Expert Brian P. Deshur Shares His 2 Cents on the 50 Cent Bankruptcy Case

In light of rap star 50 Cent’s bankruptcy case, Chicago bankruptcy attorney Brian P. Deshur, of Deshur Law Firm LLC (deshurlaw.com), analyzes the differences between Chapter 7 bankruptcy and Chapters 11 and 13.

Chicago, IL (PRWEB) August 21, 2015

The news and social media have been abuzz lately with the story of rapper 50 Cent (aka Curtis Jackson), the mega music star, who recently filed for Chapter 11 bankruptcy protection. Many people have made light of a public figure, who is so identified with wealth, going bankrupt. Furthermore, a slew of media reports have questioned his motives, including a July 17, 2015 CNN Money article and the July 14, 2015 Washington Post article. Specifically, they theorize that his filing has more to do with asset and lawsuit protection than it does with actually being broke.

“50 Cent may be trying to avoid Chapter 7 bankruptcy because he will likely lose all of his property,” said Brian P. Deshur, one of the most active bankruptcy filers in Illinois over the last decade. “Chapter 11 bankruptcy, like Chapter 13 bankruptcy for lower income wage earners, is designed to allow the filer to keep all of his or her personal property and real estate, if they so choose.” Deshur notes, however, that “the U.S. trustee or a judgment creditor can force the conversion of a Chapter 11 case to one arising under Chapter 7,” which is what one of the creditors could do in 50 Cent’s bankruptcy. The purpose of this, explained Deshur, “would be to force 50 Cent to liquidate his property and give more money to his creditors.”

Deshur, who has filed over 2,000 bankruptcy cases, while also having counseled debtors in an additional 4,000 creditors’ meetings, further stated that the trustee in a Chapter 7 bankruptcy case is paid a commission by the court for any property that he or she is able to sell. “Very few debtors know this and, by the time they file,it’s too late because that property is now under the control of the trustee,” he said.

Deshur, who has represented creditors in some of the largest Chapter 11 bankruptcy filings in the country, including Radio Shack, Circuit City, MF Global, and the Chicago Tribune, always stresses to his clients that Chapters 11 and 13 are the safest way to protect their property. While this typically requires a 3-to-5-year repayment program, the filer oftentimes will pay back only 10 cents on the dollar of his or her bills. At the end of the plan, the judge will enter an order discharging the remainder of the debt.

“With Chapter 7, the trustee can and will liquidate all of your nonexempt property and use the money to pay off your creditors, whereas with Chapters 11 and 13, your property is completely protected,” said Deshur. “Many of my clients think that Chapter 7 is a quick fix, and I tell them that they should be prepared to walk away debt-free, but also with only the clothes on their back, and perhaps, an underwater home. I typically only recommend Chapter 7 when my client doesn’t own much property - not even a vehicle. It’s my job to protect what little they may have.”

Brian P. Deshur earns a judgment for a client in an amount exceeding $600,000 because she was harrassed over a $74.00 phone bill

Sources:

http://www.ncbrc.org/wp-content/uploads/Galutan-Order-November-2012-362-sanctions.pdf

http://chicagopressrelease.com/news/federal-judge-awards-chicago-woman-17940-in-damages-over-74-phone-bill

Case Conclusion Date:November 25, 2012

Practice Area:Bankruptcy / Chapter 7

Description:The Bankruptcy Court for the Northern District of Illinois took decisive action to sanction an internationally active telecommunications company, Owtel Inc., for persistent violations of the automatic stay under section 362(a)(6). In re Galutan, No. 12-31837 (Bankr. N.D. Ill. Nov. 16, 2012). The court found that Owtel was informed of the debtor’s bankruptcy filing on August 12, 2012, but continued to dun her for payments of the $74.00 debt with repeated letters and telephone calls to her home phone and cell phone as often as twice a day. Finding that the conduct was willful the court turned to the appropriate damage award under section 362(k). Although the Seventh Circuit does not permit monetary awards for emotional distress the court found actual damages in the amount of $2,940.00 for attorney fees and costs incurred in pursuing the stay violation. In addition, the court found that the egregious nature of Owtel’s relentless pursuit warranted a punitive damage award of $15,000.00. The court ended with the warning that if the violations continue, it would consider further sanctions in the amount of $500.00 per day.