January 22, 2015 Articles

The Significance of Bankruptcy in Mass Torts Litigation

By M. Joseph Winebrenner

Defendants in mass tort litigation often face hundreds or even thousands of related lawsuits that, taken as a whole, can represent significant potential liability. Although a global defense strategy in this context—common to all cases—is crucial, it is also important to pursue, and win, individual case-specific victories whenever possible. By whittling away at the bad cases, mass tort defendants can reduce the overall caseload, manage potential liability, and change the public perception of the litigation for the better.

In pursuing case-specific victories, one often overlooked area of inquiry is a plaintiff’s prior or pending bankruptcy. In many jurisdictions, bankruptcy—a procedure through which an insolvent individual or organization can discharge debts owed to creditors—can have case-dispositive implications for lawsuits that were either pending or ripe at the time the bankruptcy petition was filed. As discussed in more detail below, bankruptcy can either deprive a plaintiff of standing to pursue his or her claims or preclude the plaintiff from pursuing claims not disclosed in the bankruptcy petition under the doctrine of judicial estoppel.

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