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You Cannot Madquerade As Some Type Of Criminal Proceeding To Collect A Debt Protected By The Automatic Stay

Bankruptcy Judge Russ Kendig of the Northern District of Ohio, Eastern Division, in a yet unpublished decision entitled In re Smith, Case No. 06-60396 (Bankr. N.D.Ohio 12-4-2006), found that whereas criminal prosecution is protected from the automtic stay, you cannot masquerade a collection case as a criminal contempt matter as it was in this case.  The Court stated in pertinent part: 

The filing of a bankruptcy petition invokes a stay of further collection efforts by a debtor's creditors...One exception [to the automatic stay] allows the 'commencement or continuation of a criminal action or proceeding against the debtor'...However, criminal proceedings that are really debt collection proceedings in disguise are not protected [by the automatic stay exceptions]...An action initiated with an intent to force collection of a debt may also contravene the stay...In order to determine whether the stay applies, the court must look at the compelling purpose of the criminal action and look at all facts and circumstances to determine the purpose of the order, as a bright-line test does not exist...A creditor is permitted to assist prosecuting authorities in punishing those who violate criminal laws...While a creditor cannot use the contempt process to aid in the collection of debt, a creditor can provide information to prosecutorial authorities regarding criminal law violations as long as the principal motivation is not based upon a desire to collect a debt.

You Must Distinquish Between What Is A Fine And What Is Compensation For A Pecuniary Loss

In what is yet an unpublished decision, Bankruptcy Judge Letitia Clark of the Southern District of Texas has issued a decision, which indicates that when suing the state agency for failing to issue a driver's license you have to distinguish between the failure to do so in an effort to collect a pecuniary loss and the State exercising it's police powers.