Court Recommends Against Allowing Nifong to Obtain Bankruptcy
Posted February 19, 2008
Updated February 20, 2008
Greensboro, N.C. — A federal court administrator says former Durham District Attorney Mike Nifong shouldn't be granted bankruptcy protection.
Bankruptcy administrator Michael West said in a statement filed Feb. 14 that the disbarred prosecutor makes too much money to get protection from creditors.
West's decision is not a ruling, but is a recommendation that goes to a judge.
Nifong filed for Chapter 7 bankruptcy protection last month, citing more than $180 million in liabilities. Most of that is the estimated damages in a lawsuit filed by three former lacrosse players who sought to prosecute on charges of rape, kidnapping and sexual assault.
Nifong listed David Evans, Collin Finnerty and Reade Seligmann, as well as three other members of Duke University's 2006 men's lacrosse team who filed a separate federal lawsuit, as unsecured creditors and said each is owed $30 million.
Shortly after West's action, Nifong's attorney amended court documents to reclassify his client's potential debt as non-consumer debt. That could keep the case in bankruptcy court because it raises the allowable income level.
Nifong's attorney, Jim Craven, said the change in the paperwork was a result of a glitch in which a box on a form was not checked. He said the problem should not prevent Nifong from declaring bankruptcy.
Nifong won indictments against Evans, Finnerty and Seligmann after an exotic dancer hired to perform at a March 2006 party reported being raped, but the case unraveled in the face of the accuser's constantly changing story and a lack of evidence.
The state attorney general dropped all charges last April and declared the players innocent victims of Nifong's "tragic rush to accuse." Nifong was later disbarred for his handling of the case and spent a night in jail for lying to a judge.
In January, a judge removed Nifong as a defendant in the players' lawsuit but said Nifong could again be added to the suit, depending on the outcome of his bankruptcy case.
If the bankruptcy judge determines Nifong willfully and maliciously injured the players, bankruptcy rules won't protect him from civil litigation.