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| DENVER -- A 10th Circuit U.S. Court of Appeals panel on Aug. 17 reversed and remanded the 2005 summary judgment ruling by U.S. Judge Tena Campbell of the District of Utah, who found that the Food and Drug Administration's use of a risk-benefit analysis in its final rule banning the sale of ephedra products was contrary to congressional intent (Nutraceutical Corp., et al v. Andrew Von Eschenbach, et al., No. 05-4151, 10th Cir.; 2006 U.S. App. LEXIS 21066).
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Frequently Asked Questions
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What happens when I file for bankruptcy?
When you file, you indicate that you want to eliminate your debt and/or repay the debt under the protection of the bankruptcy court. By doing so, you can protect your personal assets from the demands of creditors, and begin to rebuild your life. Filing for bankruptcy is initiated by filing out bankruptcy forms at the federal bankruptcy court. A good bankruptcy attorney can guide you about the types of bankruptcy to choose; depending on your situation you can seek to wipe out all the debts that you owe in a liquidation. Or, you can seek a reorganization bankruptcy and create a plan approved by bankruptcy court that sets out how you will repay your debts. Depending on what you can afford, you may have to repay some debts in full or other debts can be repaid partially.
What types of bankruptcy are there?
Bankruptcy proceedings are divided into two kinds: liquidation or reorganization. If you are a consumer who is burdened with too many debts from medical bills, taxes and loans, then the most common type of bankruptcy filing is Chapter 7, which is a liquidation. Under a Chapter 7 filing, the bankruptcy court appoints a trustee, who collects the property of the debtor that is non-exempt (there are certain kinds of assets that can be exempt from seizure), then sells it and distributes the proceeds to your creditors.
The reorganization kinds of bankruptcy are done under chapters 11, 12 and 13. Most consumers use Chapter 13, which requires you to submit a plan for approval by the bankruptcy court. The plan will propose how you will repay your debts. Depending on your financial situation, some debts may be totally repaid, while others may be partially or not paid at all.
What is different with the new bankruptcy law?
Congress passed the Bankruptcy Prevention and Consumer Protection Act in April 2005 with the intentions of reforming bankruptcy law. The law seeks to require debtors (who can afford it) to make some progress toward reducing their debt, while still giving them flexibility to get the remainder of the debt erased. The new law requires people with incomes above a set level to pay some or all of their credit-card charges, medical bills and other obligations.
Under the old bankruptcy system, a federal bankruptcy judge had the power to decide if debtors must repay some or all of their debt. With the new law, debtors without the assets or income to pay the debts can still file for Chapter 7 bankruptcy. But if the debtors have a certain income above the means test usually the level of the states median income can be forced to file for Chapter 13. At that point, a judge orders a repayment plan.
The new law also has some key difference, such a requiring anyone who is filing for bankruptcy to pay for credit counseling. Child support claims are given top priority among creditors claims. The courts can also make special exceptions for active-duty service members, low-income veterans and those with serious medical conditions.
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