Continuing the Complaint against Upright Law in the case of In Re: Joyce Ellen Bishop, Case Number 16-20593 by the US Trustee in the US Bankruptcy Court for the Western District of New York (in Rochester).
In the interest of full disclosure, I am an affiliate with Upright Law – I co-represent their (our) clients in the northern counties of the Eastern Division of the Southern District of Illinois
After alleging facts, the Complaint fits those facts to the laws and rules the US Trustee alleges Upright violated: last time we read of Count 1 (claiming to be a nation-wide firm able to practice in New York – instead having the case initially handled by non-attorneys and non-New-York licensed attorneys), Count II for putting misleading information in their disclosure (attorney fee) statements and Count III for knowing they made many mistakes on the petition preparation which taken as a whole, made a mess of the case!
(the filed Complaint continues…)
COUNT IV – 11 U.S.C. § 105 AND INHERENT POWER
116) The allegations set forth are incorporated by reference.
117) Section 105(a) authorizes the court to “issue any order, process, or judgment that is necessary or appropriate to carry out the provisions” of the Bankruptcy Code and permits the court to “tak[e] any action or mak[e] any determination necessary or appropriate to enforce or implement court orders or rules, or to prevent an abuse of process.” 11 U.S.C. § 105(a).
118) In addition, federal courts have inherent power to regulate the conduct of attorneys and parties that appear before them. Chambers v. NASCO, Inc., 501 U.S. 32, 43 (1991). See also In re Hull v. Celanese Corporation, 513 F.2d 568, 571 (2d Cir. 1975) (holding the district court bears responsibility for supervision of the members of its bar); In re Chase, 372 B.R. 142, 153-54 (quoting Sakon v. Andreo, 119 F.3d 109, 113 (2d Cir. 1997); Rosario v. St. Luke’s Hospital Center (In re Goldstein), 430 F.3d 106, 110-11 (2d Cir. 2005) (the court has broad discretion in deciding what sanctions should be imposed)). Wharton v. Calderon, 127 F.3d 1201 (9th Cir. 1997) (holding that federal courts have inherent authority to regulate conduct of attorneys).
119) This Court may use section 105(a) and/or its inherent power to require Upright to award damages, as appropriate, and any further relief as the Court deems necessary to deter such misconduct and abuse from ever occurring in the future.
120) Cause exists for the court to use its inherent power and the authority granted to it under 11 U.S.C. § 105(a) to prohibit the Defendants from practicing before this court whether directly or indirectly through any companies in which they have any ownership interests or management authority. Cause also exists to sanction them monetarily.
121) The United States Trustee reserves the right to amend or supplement this pleading.
WHEREFORE, the United States Trustee, by counsel, requests that the court (i) cancel the debtor’s retainer agreement with Upright Law, LLC, and/or Law Solutions Chicago, LLC, and/or Allen Chern Law, and Jason Racki; (ii) enjoin the debt relief agency defendants from committing future violations of 11 U.S.C. § 526; (iii) impose appropriate civil penalties against the debt relief agency defendants; (iv) prohibit Jason Racki, Upright Law, LLC, Law Solutions Chicago, LLC, Allen Chern Law, and Allen Chern, from practicing before this court whether directly or indirectly; (v) to order damages and/or sanctions as may be warranted and (vi) take such other action as the Court deems necessary to deter such misconduct and similar schemes in the future.
(end of section reprinting the Complaint)
Filed by Kathleen Dunivin Schmit of the US Trustee’s office (WILLIAM K. HARRINGTON )
United States Trustee for Region Two) on April 28, 2017.
Next month I will examine the response by Upright to these allegations …
About the blogger:
Michael Curry of Curry Law Office in Mount Vernon, Illinois http://michaelcurrylawoffice.com/) has helped thousands of individuals, family and small businesses in southern Illinois find protection under the Bankruptcy Code for almost twenty-five years. He is also available to help individuals and families with their estate planning (wills, power-of-attorney) and real estate and other sales transactions.
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Whether you live in Mount Vernon, Salem, Centralia, or anywhere in Southern Illinois call Curry Law Office today at (618) 246-0993 and Finally Be Financially Free!
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