Many railroad workers either do not have or do not have enough supplemental sickness benefits or disability insurance to protect them in case of an accident. After being injured at work, they find themselves in financial trouble. The railroad plays games regarding paying medical bills. The railroad claim agents pressure injured railroaders to take quick, short settlements. With few other options available, injured railroaders turn to filing for bankruptcy.
Bankruptcy, if done correctly, can afford an injured railroader protection from creditors and discharge most debts. If mishandled, bankruptcy can turn into a nightmare.
An injured railroader must understand that an FELA claim is considered an asset of a bankruptcy estate. Further, it is the railroader’s responsibility to make sure their FELA claim is disclosed and listed as an asset of the bankruptcy estate. It is irrelevant whether or not a lawsuit has been filed. It does not matter if the bankruptcy attorney asked about possible FELA claims in their interviews. An injured railroader must disclose the FELA claim in a bankruptcy matter and a failure to do so may be considered fraud! Further, if the railroader becomes injured while the bankruptcy is still pending, the bankruptcy attorney needs to be notified so he or she can include the injury claim on the bankruptcy schedules.
If the railroad learns that the employee failed to disclose their FELA claim in a bankruptcy matter, it can:
withdraw all settlement offers and stop negotiations, and/or
- report the failure to disclose to the judge handling the FELA lawsuit (if a suit has been filed) who then may dismiss the case as a sanction for failing to disclose the claim and may also ask for criminal charges!
It is important, therefore, if you are an injured railroader and need to file, or have filed bankruptcy:
Inform your bankruptcy attorney that you have an FELA claim and make sure that it is listed as an asset of the bankruptcy estate.
- Inform your FELA attorney about filing bankruptcy. Your railroad injury attorney can help see that the FELA claim is not omitted from the list of assets. Also, your FELA lawyer can work with your bankruptcy attorney and the bankruptcy trustee to handle your FELA claim in a way that helps you get the maximum recovery you are entitled to under the law.