Exxon Dealers Class Action As Bankruptcy Asset

have received a few calls in the past months from people who had filed bankruptcy several years ago and have been notified recently that they are entitled to recover money as part of a class action lawsuit brought by a class of Exxon gas station owners against Exxon. The latest caller said that at the time he filed bankruptcy he had not filed a claim to be included in the Exxon class and did not know he was eligible to file a claim. Nevertheless, it turns out that he had a cause of action as part of the class action at the time he filed bankruptcy. The class action administrators are refusing to pay him his share of the recovery until he gets an order from the bankruptcy court stating whether or not the recover is part of his bankruptcy estate.

This claimant/debtor probably has to reopen the bankruptcy case to amend his schedule of assets. Based on the facts presented, the debtor did not act in bad faith by failing to list a cause of action against Exxon because he had no knowledge of his right. My guess is that even absent bad faith the Exxon recover should be part of his bankruptcy estate and notices should be sent to his creditors. Even then, is the value of the asset the amount which would have been the present value at the time of the bankruptcy, or is it value the amount of recovery today including substantial interest. It will be interesting to see how the bankruptcy judge resolves this issue.

posted by Jonathan Alper, bankruptcy and asset protection lawyer, Orlando, Florida