Business & Corporate
Creditor’s “Unreasonable” but “Good Faith” Belief as a Defense to an Alleged Discharge Violation
A bankruptcy court may use the contempt power to protect its jurisdiction and address violations of a discharge injunction. Is a creditor’s good-faith belief that the discharge injunction does not apply to its action relating to a discharged debt a valid defense? The U.S. Supreme Court will soon decide, resolving a split among the circuit courts in an upcoming case that will prove an important benchmark of accountability for creditors and debtors alike in the area of discharged debts.