Teresa Giudice, star of the television show "Real Housewives of New Jersey" spent almost one year in federal prison after she and her husband both pleaded guilty to bankruptcy fraud and conspiracy to commit mail and wire fraud. According to Giudice, legal malpractice may have been responsible for her federal charges. Giudice claims that she suffered damages from her bankruptcy attorney's errors when inaccurate financial statements were filed and federal prosecutors built a fraud case against her.
Giudice filed a legal malpractice lawsuit against her bankruptcy attorney, but on May 26 a superior court judge dismissed the case without prejudice, so Giudice will be able to file the case again later on. The judge who dismissed the malpractice lawsuit pointed out that all lawsuits are stayed during a bankruptcy filing. In May, a U.S. bankruptcy court judge decided to reopen Giudice's bankruptcy case so that a decision could be made about whether her creditors would be entitled to receive any portion of her legal malpractice award should she receive one.
Giudice's attorney has asked the judge who dismissed the legal malpractice case to reconsider his decision. The attorney says that legal actions are only stayed during a bankruptcy filing when the debtor is the defendant. In Giudice's lawsuit, she is the plaintiff. Giudice's attorney also argued that if Giudice should receive any award for legal malpractice it should not be distributed to her creditors.
Legal errors in a bankruptcy case can have devastating consequences for a debtor. A person who has been convicted of bankruptcy fraud may want to have assistance from an attorney when seeking to present evidence that proves that a bankruptcy attorney failed to follows a client's instructions, missed deadlines or committed other types of malpractice.
Source: NJ.com, "'RHONJ' star Teresa Giudice's legal malpractice case halted by judge," Vicki Hyman, June 1, 2016