U.S. Bankruptcy Judge Marvin Isgur sitting in Houston, after repeatedly admonishing a lawyer for Discover Bank, finally ordered him to comply with Bankruptcy Rule 7009, and describe with particularity from now on in his legal pleadings how Discover claims that debtors defrauded them. In re Monteagudo, Adversary No. 12-03146, in the U.S. Bankruptcy Court for the Southern District of Texas.

A debtor filed Chapter 7 bankruptcy in Houston and included his Discover card balance. Discover, through lawyer Jason Anderson and the law firm of Weinstein & Riley, filed a legal pleading claiming that the debtor had somehow defrauded them (usually happens when a debtor charges up the card after the debtor decided to file bankruptcy- it's not known what happened in this case), but failed to specify exactly how or why Discover Bank believed they had been defrauded.

This is required by the Rule 7009 of the Bankruptcy Rules of Procedure. Debts that are shown to be incurred through fraud are not discharged in bankruptcy. Even though the judge warned Jason Anderson and Weinstein & Riley on several occasions, they did not change their ways.

So U.S. Bankruptcy Judge Marvin Isgur ordered Jason Anderson and Weinstein & Riley to in the future comply with Rule 7009, file a copy of the order in each adversary proceeding that they file in the Southern District of Texas in the next year, and send a copy of it to the people they are suing.

The court also took under advisement whether further proceedings would be commenced against Mr. Anderson because he "failed in multiple duties to the court." This case was later appealed, but it was affirmed by the U.S. District Court, and then when it was appealed to the Fifth Circuit Court of Appeals, it was affirmed again.

J Thomas Black
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Board Certified, Consumer Bankruptcy Law- Texas Board of Legal Specialization
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