Summary
In Lott, the plaintiff evidenced her knowledge of her discrimination claim by filing an EEOC charge one month before initiating her bankruptcy case in which she omitted her potential discrimination claim.
Summary of this case from Owens v. Dolgencorp, LLCOpinion
Case No. 3:00-cv-1216-J-20TJC
March 4, 2002
ORDER
This cause is before the Court on Defendant's Motion for Summary Judgment on the Basis of Judicial Estoppel (Doc. No. 15, filed November 8, 2001) and Plaintiffs Memorandum of Law in Opposition (Doc. No. 19, filed November 21, 2001). Upon due consideration, and for the reasons set forth herein, the Motion is GRANTED.
Defendant filed a second summary judgment motion on January 3, 2002 (Doc. No. 25). Because the Court grants the earlier motion and dismisses this action in its entirety with prejudice, the latter summary judgment motion and all other pending motions are DENIED as MOOT.
I. Summary Judgment Standard
Summary judgment is appropriate "if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). The moving party bears the initial burden of showing the Court, by reference to materials on file that there are no genuine issues of material fact that should be decided at trial. Clark v. Coats Clark. Inc., 929 F.2d 604, 608 (11th Cir. 1991). When a moving party has discharged its burden, the nonmoving party must then "go beyond the pleadings," and by its own affidavits, or by "depositions, answers to interrogatories, and admissions on file," designate specific facts showing that there is a genuine issue for trial. Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986).
In determining whether the moving party has met its burden of establishing that there is no genuine issue as to any material fact and that it is entitled to judgment as a matter of law, the Court must draw inferences from the evidence in the light most favorable to the nonmovant, West Harbor v. City of Key West, 987 F.2d 723, 726 (11th Cir. 1993), and resolve all reasonable doubts in that party's favor. Spence v. Zimmerman, 873 F.2d 256, 257 (11th Cir. 1989).
Thus, if a reasonable fact finder evaluating the evidence could draw more than one inference from the facts, and if that inference introduces a genuine issue of material fact, then the court should not grant the summary judgment motion. Augusta Iron and Steel Works v. Employers Insurance of Wausau, 835 F.2d 855, 856 (11th Cir. 1988). It must be emphasized that the mere existence of some alleged factual dispute will not defeat an otherwise properly supported summary judgement motion. Rather, "the requirement is that there be no genuine issue of material fact." Anderson v. Liberty Lobby. Inc., 477 U.S. 242, 248 (1986). A dispute about a material fact is "genuine" if the "evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. The inquiry is "whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Id. at 251-52.
II. Background
Plaintiffs Amended Complaint (Doc. No. 11, filed February 13, 2001) states six claims for relief, all of which arise out of her supervisor's alleged unlawful sexual harassment— including an alleged sexual assault— and her employer's failure to adequately respond to her complaints of harassment. All of the underlying incidents are alleged to have occurred while Plaintiff was employed as a shipping confirmation clerk by the Defendant Sally Beauty Co., Inc. The underlying factual allegations are set forth in this Court's Order (Doc. No. 9, filed January 30, 2001) granting in part and denying in part Defendant's Motion to Dismiss, and need not be repeated here in detail because they are not directly relevant to Defendant's instant Motion.
Rather, Defendant's Motion is based on a misrepresentation made by the Plaintiff when she filed a voluntary petition for bankruptcy under Chapter 13 of the United States Bankruptcy Code. The Motion asserts that since Plaintiff denied having any existing claims in sworn documents submitted to the Bankruptcy Court, she should be "judicially estopped" from subsequently pursuing those same claims in an unrelated employment discrimination action.
Plaintiff filed a petition for Chapter 13 bankruptcy on December 3, 1999. As part of her petition, she was required to submit a Chapter 13 Plan ("Plan"), under which she agreed to pay the Bankruptcy Trustee $204.00 per month for a period of sixty (60) months. The Plan included several Schedules itemizing Plaintiffs assets, including a "Statement of Financial Affairs" Schedule, wherein she was required to respond to a series of written questions. Question number four of the Financial Affairs Schedule, appearing on the first page of the Schedule, read as follows:
The Bankruptcy Court later dismissed Plaintiffs petition for failure to make scheduled payments, a fact which this Court views as inconsequential in resolving the instant summary judgment motion.
4. Suits and administrative proceedings, executions, garnishments and attachments
a. List all suits and administrative proceedings o which the debtor is or was a party within one year immediately preceding the filing of this bankruptcy case.
App. to Defs Motion for Summary Judgment ("App.") (Doc. No. 17) at 51.
In response to this question, Plaintiff checked a box indicating "none". She now acknowledges that this response was untrue. In actuality, at the time she filed her Chapter 13 petition. Plaintiff had a pending Charge of Discrimination with the United States Equal Employment Opportunity Commission ("EEOC Charge"), based on the alleged acts of employment discrimination that form the basis for her instant action against her former employer. She filed the EEOC Charge on November 9, 1999, one month before filing for bankruptcy.
At the time she submitted the Chaprter 13 Plan, Plaintiff signed a Debtor's Disclosure/Dislclaimer stating that her attorney had "explained in detail to me my obligation to disclose all my assets in my schedules filed in this bankruptcy proceeding." This document was signed under penalty of perjury. App. at 31. Plaintiff subsequently confirmed in her deposition that her attorney reviewed the bankruptcy petition with her before she filed it, and that she understood what her attorney was telling her at that time. App. at 6.
Plaintiff does not dispute any of these facts. Rather, she claims that due to her relatively "limited education" — she has a high school diploma and one year of college — she did not understand, and her lawyer did not specifically explain, her obligation to list her EEOC Charge as one of her assets in response to question four on the Statement of Financial Affairs Schedule. She also notes that in that same Schedule she indicated in response to a separate question that she had an automobile seized in November 1999; she cites this as evidence that her failure to list her EEOC Charge was unintentional.
III. Discussion
Under the doctrine of "judicial estoppel," parties are precluded from assuming a position in litigation that is inconsistent with one previously asserted in another judicial proceeding. See McKinnon v. Blue Cross Blue Shield of Alabama, 935 F.2d 1187, 1192 (11th Cir. 1991). The essential purpose of the doctrine is to prevent a party from "making a mockery of justice by inconsistent pleadings." Id. See also Taylor v. Food World, Inc., 133 F.3d 1419, 1422 (11th Cir. 1998) (recognizing the doctrine); Chandler v. Samford Univ., 35 F. Supp.2d 861, 863 (N.D. Ala. 1999) ("This doctrine, distinct from the concept of equitable estoppel, precludes a party from assuming a position in a legal proceeding inconsistent with one previously asserted when inconsistency would allow the party to `play fast and loose with the courts.'") (quoting Ryan Operations, G.P. v. Santiam-Midwest Lumber Co., 81 F.3d 355, 361-62 (3d Cir. 1996)).
Although the Eleventh Circuit has yet to specifically approve application of the judicial estoppel doctrine in cases where the inconsistency arose out of a bankruptcy proceeding, the doctrine's goal of ensuring integrity in judicial proceedings appears equally well served in such cases. Accordingly, this Court joins the multitude of others that have applied the doctrine in cases where a debtor attempts to assert a position in litigation that is inconsistent with one advanced during a previous, yet unrelated, bankruptcy proceeding. See. e.g., In re: Coastal Plains Inc., 179 F.3d 197 (5th Cir. 1999); Payless Wholesale Distributors, Inc., v. Alberto Culver (P.R.) Inc., 989 F.2d 570 (1st Cir. 1993); Oneida Motor Freight, Inc. v. United Jersey Bank, 848 F.2d 414 (3d Cir. 1988); Scoggins v. Arrow Trucking Co., 92 F. Supp.2d 1372 (S.D. Ga. 2000); Chandler, 35 F. Supp.2d at 861.
Because the doctrine aims to protect the court's interest, rather than any individual party's, it is not necessary that the two proceedings in which the inconsistent statements were made be related, or that the party against whom the inconsistent pleading is being used be specifically prejudiced by the inconsistency. See Chandler, 35 F. Supp.2d at 863. This is essentially what separates judicial estoppel from the related concept of equitable estoppel. where a party is precluded from advancing a particular position because of its adversary's detrimental reliance on an earlier inconsistent statement. See id. at 863, n. 2.
Application of the judicial estoppel doctrine is appropriate where a reviewing court determines that: (1) the positions asserted are in fact inconsistent; and (2) the inconsistency would allow a party to benefit from deliberate manipulation of the courts. Id. at 863. There is no doubt in this case that the positions asserted by the Plaintiff before the Bankruptcy Court and this Court are inconsistent. In the Bankruptcy Court, Plaintiff denied being a party to any administrative proceedings despite having filed an EEOC Charge only one month earlier. Subsequently, in both her Original and Amendment Complaint, Plaintiff alleged as a jurisdictional prerequisite to her employment discrimination action that she filed a charge of employment discrimination with the EEOC, referencing the November 1997 EEOC Charge. There is no reconciling these contrary positions, and Plaintiff does not attempt to do so.
Instead, she argues that she did not "deliberately manipulate" the Bankruptcy Court— deliberate manipulation being the second element of judicial estoppel. In assessing this argument, this Court is aided by the district court's opinion in Chandler. In that case, a debtor was judicially estopped from proceeding with her employment discrimination when, during her Chapter 13 bankruptcy proceeding, she failed to disclose a pending charge of discrimination against her former employer. Finding this failure to disclose inconsistent with her position in the employment discrimination suit, the district court turned to the second prong of the judicial estoppel analysis, whether the debtor had attempted to deliberately manipulate the judicial system. In finding that she had, the court emphasized three factors: first, the debtor had knowledge of her discrimination claim and failed to disclose it to the Bankruptcy Court; second, she had an affirmative duty to disclose her claim; and finally, she had a motive to conceal her discrimination claim in that the debtor's nondisclosure prompted the bankruptcy court to proceed as if her case were a "no asset" case and may have dissuaded her creditors from objecting to the proposed administration of her estate. Chandler, 35 F. Supp.2d at 864-65.
The Debtor in Chandler had filed for bankruptcy before she filed her EEOC charge of discrimination. However, a Chapter 13 debtor must disclose all legal or equitable interest in property as of the commencement of the case as well as any interest in property the bankruptcy estate acquires after the commencement of the bankruptcy proceeding. Thus, in the district court's view, her failure to voluntarily disclose the EEOC Charge at the time she filed it was "inconsistent" with her position in the subsequent discrimination action. Chandler, 35 F. Supp.2d at 864 n. 2.
This Court finds these same factors to be present in this case. There is no doubt that Plaintiff was aware of her EEOC Charge, filed just one month before the bankruptcy proceeding. Regarding a duty to disclose, a Chapter 13 bankruptcy estate includes "all legal or equitable interests of the debtor in property as of the commencement of the case." Id. § 541(a)(1). Among these interests are causes of action existing at the time of the commencement of the bankruptcy proceeding. Miller v. Shallowford Community Hosp., 767 F.2d 1556, 1559 (11th Cir. 1985). Therefore, Plaintiff had a legal duty to disclose her claim.
Finally, there is ample evidence of a motive to conceal the Charge in this case. The undisputed facts demonstrate that Plaintiffs claim against her former employer potentially represented a substantial percentage of her assets; its inclusion as part of her bankruptcy estate could have easily affected the administration of her estate, including her monthly payments to the Trustee under the Bankruptcy Plan. Although Plaintiff may not have as much formal education as the debtor in Chandler, who held a number of advanced degrees, she is sufficiently educated to have been reasonably expected to understand the questions on the Financial Affairs Schedule. More importantly, by her own admission Plaintiff reviewed the petition with her attorney before submitting it, and claimed at that time to have understood. it. Given these representations, her current stance that she did not understand the question seems disingenuous.
Plaintiff also attempts to distinguish Chandler in that the debtor's misrepresentation in that case resulted in a "no asset" determination, whereas in this case Plaintiff disclosed other assets despite her failure to disclose her pending EEOC Charge. This argument is also unpersuasive. Even if Plaintiff disclosed some assets, by omitting reference to the EEOC Charge she failed to disclose what was potentially her most valuable asset. Hence, the fact that she revealed some of her assets but not others in no way diminishes the appearance of a motive to conceal.
Given these undisputed facts this Court concludes that Plaintiff wilfully misled the Bankruptcy Court when she represented that she was not a party to any administrative proceedings, despite having recently filed an EEOC Charge of discrimination. The doctrine of judicial estoppel was specifically designed to prevent such manipulation of the judicial system, be it the District Court or the United States Bankruptcy Court. Plaintiffs irreconcilable positions in the two proceedings leave this Court with no choice but to dismiss this action with prejudice.
IV. Conclusion
For the reasons stated herein, it is ORDERED that:
1) Defendant's Motion for Summary Judgment on the Basis of Judicial Estoppel (Doc. No. 15, filed November 8, 2001) is GRANTED, and this case is DISMISSED WITH PREJUDICE.
2) The Clerk shall enter judgment in favor of the Defendant and against the Plaintiff and close the fie.