Creditors Risk Contempt By Pursuing Invalid Debt: Justices

Law360 (June 3, 2019, 11:27 AM EDT) -- The U.S. Supreme Court on Monday held that a creditor can be held in contempt for trying to collect on a debt that was wiped away in bankruptcy if there is no "fair ground of doubt" that a court order barred the creditor's conduct.

The high court unanimously rejected a Ninth Circuit ruling that sanctions were barred if the creditor acted in good faith belief the debt wasn't discharged as "inconsistent with traditional civil contempt principles," but found that petitioner Radley Taggart's argument that the creditor's understanding of the discharge order should not be considered would leave the courts clogged with...

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