U.S. Court: Bankruptcy




Samantar’s bankruptcy action continued despite the district court’s February 2012 judgment and August 2012 damages award.  CJA continued to be involved in the bankruptcy action on behalf of the Yousuf v. Samantar plaintiffs in their capacity as creditors, given the $21 million damages award against Samantar.  The judge dismissed CJA’s initial motion to dismiss these proceedings in their entirety.  The judge stated that the Yousuf v. Samantar plaintiffs had a strong case for non-dischargeability – meaning that because of the gravity of Samantar’s human rights crimes, bankruptcy relief may not be available for him.  In bankruptcy proceedings generally, there are certain types of personal injury and tort claims – including fraud, breach of fiduciary duty, and willful or malicious conduct – that are not subject to bankrupty relief and are therefore “non-dischargeable.”

In August 2012, CJA filed an adversary complaint seeking a denial of the discharge of the $21 million damages award in favor of the Yousuf v. Samantar plaintiffs.  Around the same time, the U.S. Trustee filed a complaint seeking a denial of discharge of all of Samantar’s debts based on its conclusion that Samantar made false statements on his bankruptcy petition.  The Trustee’s complaint charges Samantar with making false oaths, concealing his assets, and improperly transferring his assets in connection with his bankruptcy filing.

In an important victory, on September 22, 2015, the U.S. Bankruptcy Court in the Eastern District of Virginia ruled that Samantar must still pay $21 million in damages, despite Samantar’s insistence that he should be forgiven his debt through bankruptcy.