Robert Kiyosaki wrote the bestselling book “Rich Dad, Poor Dad.” This financial self-help volume was read by thousands of dads who wanted to plan their money right. In addition to this original book which became a New York Times bestseller, Kiyosaki also wrote “Retire Young, Retire Rich” and “Midas Touch.” The latter book was co-authored by the real estate mogul and television personality Donald Trump. Yet despite apparent success, Kiyosaki recently had to file for a company bankruptcy with his company Rick Global LLC. The author filed for Chapter 7 bankruptcy protection on August 20^th, but the embarrassing fact was only released to the New York Post this week. Kiyosaki and his bankruptcy attorney have received a flood of calls from press agencies, but have yet to respond to any of them.

Forbes reports that Kiyosaki’s debt is mostly due to a lawsuit from Learning Annex. This company was one of the author’s earliest backers in the 1990’s when his book fist came out. They helped to arrange a lot of his public speaking events when Kiyosaki was just getting the ball rolling. Bill Zanker, the founder and president of Learning Annex claims that Kiyosaki failed to pay him a percentage of the profits from his speaking engagements, even though that was the agreement that they had settled on in a contract. Zanker says that he signed a letter of intent and that Learning Annex is responsible for turning “Rich Dad” into the brand that it has become. He claims that he allowed Kiyosaki to merit the fame and riches that he ended up with. He says that he expected to see profit in return, but never did.

Kiyosaki may be filing for bankruptcy in one company, but has a variety of other corporations that seem to be sustaining themselves nicely. One of those corporations is Rich Dad Co. The CEO of Rich Dad, Mike Sullivan, says that the dealings with learning Annex were concerning an older company that hasn’t been in active business for years. Learning Annex’s lawsuit regards a $20 million settlement, and Sullivan says that the expired company doesn’t have that type of money. He confirmed that Kiyosaki is not paying any of the bankruptcy costs out of his own personal finances. Sullivan says that they believe that the settlement figures are outrageous and that they only owe the company a couple million dollars, not $16 to $20 million. Currently, Learning Annex is resting with a $23.7 million legal claim. Rich Global LLC filed bankruptcy with nearly $1.8 million in assets and up to $26 million in liabilities that have to do with the lawsuit.

If you have been hit with a lawsuit that you can’t afford, then bankruptcy may be your best option. You can liquidate your assets in order to pay back the filer and may even be able to discharge other debts that you have hanging over your head. Unfortunately, your lawsuit cannot be discharged like an unsecured debt can be. You will need to devote all profits from sales or from future income to covering the costs of the lawsuit. The court may be able to whittle the lawsuit down to a figure that you know you will be able to meet at some point in the future. While financial difficulties like large lawsuits are unfortunate, they do happen. Contact a bankruptcy attorney today if you are in a situation like Kiyosaki and need help sorting through your lawsuit and the finances that you have to meet that obligation. Even those with expert financial advice can get caught in a difficult situation. With a bankruptcy attorney by your side, you can work hard to remove the debts from your life and get started on a fresh, new track.