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May 2014

Chapter 7 bankruptcy filing fees go up–is that fair?

Posted by / in Blog, Personal Bankruptcy, Weekly Posts / No comments yet


Apple paid $350 filing fee for a two billion dollar legal battle that tied up this Federal court house for a month. You pay $335 for a bankruptcy hearing lasting four minutes.

On June 1, the filing fee for a consumer chapter 7 bankruptcy goes up from $306 to $335.  Is that fee fair?

Let’s do a comparison.  In a month-long jury trial ending yesterday, Apple was awarded $119 million in their patent lawsuit Samsung.   Apple had asked for lots more–$2.2 billion–in this battle of smartphone giants.  The case started in February 2012.  Apple had 82 lawyers, just on their side.  More than 1800 documents were filed–the very first one had 252 pages.

Apple had to pay a filing fee of all of $350.00 to sue its smart phone rival for two billion dollars, using 80 lawyers, filing more than one hundred thousand total pages and tying up the Federal courthouse in a jury trial for a month.

My Chapter 7 bankruptcy clients have to pay a filing fee of $335.   In most cases, I’ll be the only lawyer, we’ll file less than a hundred pages, have a four minute administrative hearing, and never see a judge.  These working, retired, and disabled Americans get a $15 discount over what Apple had to pay.

The average consumer chapter 7 bankruptcy does not take 0.1% (maybe not .01%) of the court resources tied up in in the Apple v Samsung fight, but our fee is 95% of their fee.

Put it another way:  a fair price to charge Apple might be $350,000,  it might even be $3.5 million.  But the taxpayers pick up 99% (or 99.9%) of the tab.

Virginia Consumer, who lost her house in the mortgage crisis, is expected to pay the full cost of using the court system to get her financial fresh start.    Apple, trying to smack down Samsung, gets a 99% corporate discount.

The corporate giants get subsidy and socialism, working people down on their luck pay market price.

Do most things in America now work that way?

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Robert Weed has helped fifteen thousand people file bankruptcy in Northern Virginia. Robert Weed is a frequent panelist and speaker at the meetings of the National Association of Consumer Bankruptcy Attorneys. He is one of Northern Virginia’s most experienced personal bankruptcy lawyers. As an expert on changing consumer bankruptcy laws, Robert Weed has been interviewed on local and national TV and quoted in newspapers across the country.

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