Judgment collection, which is the process of collecting a monetary award following civil litigation, sometimes degrades into a competition between judgment creditor and debtor. The creditor uses every legal tool to extract payment. Meanwhile, the debtor does everything he can to avoid paying.
In such cases, creativity often wins the day. A creative creditor or his representative finds previously unknown assets no one else would even think to go after. But because those assets are nonexempt, they are fair game.
A Real-Life Case From Los Angeles
A case currently unfolding in Los Angeles shows just how creative some creditors can be. It involves a hip-hop artist known as Blueface. He lost a 2023 defamation case and was ordered to pay $125,000 to the plaintiff. He has yet to pay what he owes. In addition, he is currently serving a four-year sentence related to a previous assault case.
Believing she might never get paid, the plaintiff has now asked the court for a levy against the musician’s royalties. Her attorneys suggest that the publishers who collect royalties on Blueface’s behalf forward those royalties to her instead. With interest and penalties, his bill has climbed to nearly $130,000.
What are the chances of the court agreeing with the plaintiff? Pretty high. Royalties are considered income. Furthermore, they are considered business income. That means they are not exempt from judgment collection. I fully expect the court to issue a writ compelling that all royalties be paid to the plaintiff until the judgment is fully satisfied.
Assets Are Crucial to Collection
The Los Angeles case clearly spells out why assets are crucial to judgment collection. The defendant in this case appeared to make no effort to pay on his own. Whether that was because of his other legal troubles is irrelevant. From the plaintiff’s perspective, the only way to collect was to go after his assets. That is what she did.
Going after assets is also what agencies like Judgment Collectors do. Based in Salt Lake City, the specialized collection agency works money judgment cases in eleven states. They say that income streams and assets are the key to successful collection.
Judgment Collectors relies on a combination of public and proprietary data sources to identify and assess debtor assets. They look at debtor income, including wages and non-wage income streams. But they also dig around for:
- Real estate holdings
- Business holdings and assets
- Personal property and collectibles
- Personal and business vehicles
- Various types of securities
State laws consider certain types of debtor property exempt. But when you stop and consider the assets of someone like Blueface, you realize that his non-exempt assets exceed his exempt assets by a lot.
Knowing What to Go After
Judgment Collectors says knowing what to go after is often the hardest part about leveraging assets for payment. Some assets are worth a lot more but are subject to considerable legal wrangling. Others are considered low hanging fruit because pursuing them doesn’t require as much on the legal side of things. But such assets tend to be worth less.
It is the creative creditor or collection agency that knows how to dig around for hidden assets. The creative ones also know which assets will produce the best payments in the shortest amount of time.
As so many judgment debtors find out after the fact, creativity can be used against them. The more creative a judgment creditor is, the more likely he is to collect from even the most persistently evasive debtors. It is how the game works.
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