In California, bringing litigation with a marginal possibility of success could be a bad bet whenever a contract permits one side to recover attorneys’ fees.
Seventh Circuit holds that comparative fault requires a reduction in compensatory damages for a discharge violation but not for a debtor’s attorneys’ fees.
Judge Rodriquez of the U.S. Bankruptcy Court for the Southern District of Texas issued an opinion in December 2024 which reinforced the axiom that actions have consequences.[1]In re Garcia Grain Trading Corp. v. Plascencia.[2] Specifically, Judge Rodriquez determined that the bad faith of a defendant movant justified fee-shifting and directed the plaintiff’s counsel to submit a fee application for their related work, which remains under advisement.
Professionals seeking to be retained in bankruptcy cases understand the importance of disclosing and avoiding conflicts as a retention condition.[1] A recent unpublished decision by the United States Bankruptcy Court for the Northern District of Texas[2] highlights that even after a professional is retained in a bankruptcy case, professionals must closely monitor and disclose potential conflicts, as post-petition conflicts can result in a reduction or denial of fees.[
