Former star’s debt
Former basketball star Jason Caffey faces threat of jail but wants to back out of bankruptcy
By BRENDAN KIRBY
A former Mobile basketball star wants to back out of his own bankruptcy case, but lawyers for at least two of the seven mothers to whom he owes child support urge the judge to sell off his assets.
Faced with the threat of jail in two states, Jason Andre Caffey went to U.S. Bankruptcy Court in Mobile a year ago, seeking breathing room to renegotiate tens of thousands of dollars’ worth of child support debts.
“There’s nothing we can do,” said Caffey, who starred at Davidson High School and the University of Alabama before going on to an NBA career. “We’re going to drop out of the bankruptcy.”
Caffey praised U.S. Bankruptcy Judge Margaret A. Mahoney, but said that he was unable to come up with the money to pay all of the child support obligations.
Caffey’s obligations involve at least eight children. Those debts cannot be reduced under bankruptcy law.
“It’s not doable,” he said. “It’s not possible.”
If Mahoney dismisses the case — withdrawing Caffey’s protection from creditors — the mothers and others would be free to resume efforts to collect from him, while state judges would be free to carry out threats to jail him for failing to pay child support.
“Our first move will be to ask the court to lift the hold on the arrest order and have him put in jail,” said Randy Kessler, an Atlanta lawyer who represents LoRunda Brown. “I think the only thing that’s going to make him pay is the threat of incarceration.”
Too much now?
Caffey maintains that the child support payments are too much for his post-NBA income. In his bankruptcy, he claims $1.9 million in debts against $1.1 million in assets.
But lawyers for some of the mothers said that Caffey has not shown a good-faith effort to follow through on his payment promises.
Acting on Brown’s behalf, Mobile-based lawyer C. Michael Smith has filed a plan that would order the sale of Caffey’s property to distribute to the creditors. That could encompass his share of three businesses, and real estate including his house, depending on its equity value.
Smith said he believes that under the law, the mothers would get the first spots in line to collect.
“In our view, and the view of my client, everybody would be better off capturing the assets locally and dispersing the proceeds to the child support claimants,” Smith said.
Hearing on Tuesday
Mahoney has set a hearing for Tuesday to determine whether to dismiss the bankruptcy.
Penny Douglass Furr, a lawyer for another of the women, Karen Russell, said liquidating the assets is far preferable to simply dismissing the bankruptcy.
“If the court dismisses, he can just take all of that property out of the country,” she said. “This is the only way the children would get any money.”
Caffey said that liquidating his assets would not generate nearly enough money to pay off his debts, and would harm his future earning potential. He said he expects most of the mothers to side with him in court.
Caffey said he had hoped to make good on his obligations by opening five day care centers. But his arrest last year on a contempt charge over unpaid child support complicated his plans.
“I think the bad press caused (the Department of Human Resources) to look at me in a real strange way,” he said.
Caffey said he can no longer be associated with day care centers. So he said he has transferred ownership of a day care in Mobile’s Crichton area to his sister, along with a business that was opening five more day cares. He said one of those five, Lots of Love Day Care Development Center, opened last week on Moffett Road.
He said that his sister has agreed to help him with the child support payments, and that he is prepared to award each of his children an equal share of his businesses, which include a sports bar.
Kessler, however, said Caffey has failed to follow through on previous commitments to his children.
Mahoney earlier this year gave Caffey permission to spend money to hire a lawyer to file a lawsuit in Georgia’s Gwinnett County seeking a reduction in the $4,250-a-month child support that he owes his child with Brown.
Kessler said Caffey refused his client’s offer of a 75 percent reduction, instead offering a few hundred dollars a month. What’s more, he added, he never sent the $500 a month that Mahoney had ordered him to pay in child support during the bankruptcy.
Court records show that the Gwinnett County judge dismissed Caffey’s lawsuit last month, reinstated the original monthly payment and ordered him to pay more than $17,000 to compensate Brown for her legal fees.