Yes the business can file for Chapter 7 bankruptcy, Chapter 13 bankruptcy or chapter 11 bankruptcy if they are defendant in a consumer fraud lawsuit. but it is up to you to decide when the best time to file bankruptcy would be. This really depends on what type of business and if the business is incorporated or a limited liability company. If you plan on keeping the business open and want to use a repayment bankruptcy such as chapter 13 bankruptcy or restructuring bankruptcy such as Chapter 11 bankruptcy you certainly would want to wait until the lawsuit has concluded before filing. If you're going to close the business and liquidated under Chapter 7 bankruptcy, it really doesn't matter when you file as the business will no longer exist at the end of the bankruptcy

I have responded to your inquiry according to the laws of Massachusetts, where I practice. Laws can vary significantly from state to state and cases tend to be rather fact-specific, so you are best served by consulting with a knowledgeable attorney in weighing your options.

Email messages/Online Correspondence are akin to conversations and do not reflect the level of analysis applied to formal legal opinions. Email/Online responses do not form an attorney-client relationship.

Joseph F. Botelho, Esq.

BOTELHO & ASSOCIATES, LLC
Attorneys At Law

www.massachusettslawyeronline.com

126 Shove Street
Unit 202
Fall River, MA 02724

Office: 888-269-0688
Cell: 508-801-6747
FAX: 877-475-8147

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