Off The Hook! Teresa Giudice Settles $13.5M Bankruptcy

Teresa Giudice Bankruptcy Settled Closed Again
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Nov. 3 2016, Updated 5:55 p.m. ET

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Teresa Giudice has cleaned up yet another of her legal issues: has learned that The Real Housewives of New Jersey star has reached a settlement in her messy bankruptcy case.

Giudice and her husband, Joe, first filed for bankruptcy back in 2009, claiming they were more than $13 million in debt. It was settled in September 2014, but reopened again in May of this year, after she filed a $5 million malpractice lawsuit against her former bankruptcy attorney, James Kridel. Court documents filed in New Jersey on November 1 show, however, that she has reached a tentative deal yet again with her trustee.

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A judge will make a final ruling on December 6. However, the bankruptcy trustee wrote in the court documents obtained by that "a settlement was reached" during an October 5 mediation session with the Giudices' team.

READ Teresa's Bombshell Deal

According to the court papers, the tentative deal contains the following points: Teresa must "acknowledge and agree to honor any outstanding pre-petition claims" from creditors. She will "receive 55% of the 'net proceeds' of the Kridel claim, meaning the gross recovery through settlement or trial" minus "the administrative costs," which the trustee will oversee. The rest will be distributed to her creditors "pursuant to the bankruptcy code," and Teresa will get anything that's left over.

The Real Housewives of New Jersey

The trustee must also "approve any settlement of the Kridel suit" and must "be kept advised of all significant developments and status of the case."

The Kridel lawsuit is still ongoing, but if the judge signs off on the proposal next month, the bankruptcy will be officially closed again.

Meanwhile, Joe is still serving his 41-month prison sentence at Fort Dix.

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