A bankruptcy judge ruled this week that chiropractor Bruce J. Paswall of Katonah may not discharge a $4.2 million “pregnancy discrimination” debt.
Judge Robert D. Drain also ruled last month that the transfer of Paswall”™s Katonah house to his sons was a “fraudulent conveyance,” and he directed the Westchester county clerk to strike the deed from the public record.
The decisions trace back to a seven-year legal fight by three women Paswall fired ”“ Melissa Rodriguez of Yonkers, Marlena Santana of the Bronx and Yasminda Davis of Roselle Park, New Jersey ”“ because they were pregnant.
The women had worked for Paswall at G.E.B. Medical Management Inc. in Manhattan. In 2008, they sued him in Bronx Supreme Court, claiming that he had imposed intolerable work conditions after they became pregnant and created false scenarios to justify firing them.
A jury awarded them $6.2 million in 2015 and the judge reduced the verdict to $4,192,938.
Last September, Paswall petitioned U.S. Bankruptcy Court in White Plains for Chapter 7 liquidation.
He declared assets of $18,028 and liabilities of $4.8 million. He described the Bronx verdict as disputed and listed the judgment at only $3.5 million.
By filing for bankruptcy, his creditors were automatically barred from collecting debts.
The women filed an adversary proceeding, arguing that the debts should be enforced because they resulted from willful and malicious injury.
U.S. Trustee Mark S. Tulis also filed an adversary proceeding, demanding $650,000 from Paswall”™s sons, Grant and Reid Paswall.
Paswall had transferred his Katonah house to his sons at no cost, the trustee argued, and they accepted the transfer “with the intent to hinder, delay and defraud creditors.”
Drain ruled that the $4.2 million Bronx court judgment is nondischargeable. Paswall did not oppose the motion for summary judgment.
Drain granted a default judgment against Paswall”™s sons, and they have appealed the decision.
The Chapter 7 bankruptcy is pending and nearly $5.1 million in claims have been filed.
Besides the claims by his former employees, their attorney, Scott A. Lucas, filed for $786,424 in legal fees that the Bronx jury awarded to him.
Paswall is represented by West Harrison attorney Gary R. Gjertsen.
