Bankruptcy Adversary Proceedings

An Adversary Proceeding is essentially a lawsuit within a bankruptcy case. A creditor or a Trustee may file adversary proceedings against a Debtor.

Here, an adversary proceeding begins with the filing of an adversary complaint alleging improper or wrongful conduct by the Debtor or someone connected to the debtor. The adversary complaint begins a separate “sub case” in the main bankruptcy case.

Although there are many types of adversary complaints that may be filed in a bankruptcy case, some of the common ones include:

  • Complaint to deny the debtor’s discharge
  • Complaint alleging a preference
  • A fraudulent transfer of assets
  • and/or a complaint alleging a preference payment (an improper payment to a creditor)

Just as in other litigation matters, a Debtor must defend against the adversary complaint filed or a default judgment may be entered to the detriment of the Debtor.