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§ 526(a)(4)

Carr, In re

Jan
22
2020
Ruling
Attorneys’ use of dual contracts for pre- and post-petition work satisfied the Bankruptcy Code.(Bankr. E.D. Ky.)
Issue(s)
Restrictions on Debtor Relief Agencies; Restricted Actions; Advice to Incur More Debt

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Consumer opinion summary, case decided on January 22, 2020 , LexisNexis #0320-012
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Hersh v. United States

Dec
18
2008
Ruling
Section 526(a)(4) prohibits only counseling that would lead to abuse of bankruptcy system and is not facially unconstitutional.
Procedural posture

The district court for the Northern District of Texas held that 11 U.S.C.S. § 526(a)(4) was facially unconstitutional. Defendant, the United States, appealed this ruling. The district court also held that attorneys qualified a debt relief agencies under 11 U.S.C.S. § 101(12A), that 11 U.S.C.S. § 527(b) did not violate the First Amendment. Plaintiff, a bankruptcy attorney, cross-appealed these rulings.

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Court :
Judge or Jurisdiction information not available
Consumer opinion summary, case decided on December 18, 2008 , LexisNexis #0209-011
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Milavetz Gallop & Milavetz PA v. United States

Sep
04
2008
Ruling
BAPCPA's 526(a)(4) restrictions on "debt relief agencies" unconstitutional as applied to attorneys meeting that definition.
Procedural posture

Appellants, a law firm, a firm president, a firm attorney and two clients, appealed from the District Court for the District of Minnesota which granted summary judgment in favor of appellee United States. Appellants claimed that the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA), 11 U.S.C.S. §§ 526(a)(4), 528(a)(4), (b)(2), did not apply to attorneys and law firms and was unconstitutional as applied to attorneys.

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Court :
Judge or Jurisdiction information not available
Commercial opinion summary, case decided on September 04, 2008 , LexisNexis #0908-119
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Zelotes v. Adams

Feb
27
2007
Ruling
Trustee permanently enjoined from enforcing section 526(a)(4) which court held to be unconstitutional.
Procedural posture

Plaintiff bankruptcy attorney sued defendant bankruptcy trustee challenging 11 U.S.C. § 526(a)(4) as violative of the First Amendment. The court denied the trustee's motion to dismiss for failure to state a claim and found that section 526(a)(4) was facially unconstitutional. The attorney moved for a judgment declaring that section 526(a)(4) was unconstitutional and enjoining its enforcement. The trustee moved for reconsideration and for summary judgment.

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opinion summary, case decided on February 27, 2007 , LexisNexis #0307-114
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Zelotes v. Martini

Nov
07
2006
Ruling
Section 526(a)(4), enacted under BAPCPA is an overbroad restriction on attorney communication and unconstitutional.
Procedural posture

Plaintiff bankruptcy attorney filed an action, alleging that 11 U.S.C. § 526(a)(4), which was enacted in the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, violated the First Amendment. Defendant trustee filed a Fed. R. Civ. P. 12(b)(6) motion to dismiss the complaint.

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opinion summary, case decided on November 07, 2006 , LexisNexis #1206-041
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