Roden v. Synergy Technologies, Inc. et al
Filing
18
ORDER & REASONS denying 7 Motion for Summary Judgment. Signed by Judge Martin L.C. Feldman on 6/4/2014. (caa)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
ERNEST G. RODEN
CIVIL ACTION
VERSUS
NO. 13-6753
SYNERGY TECHNOLOGIES, INC.,
& STERIFX, INC.
SECTION âFâ
ORDER & REASONS
Before
judgment.
the
Court
is
the
defendants'
motion
for
summary
For the reasons that follow, the motion is DENIED.
Background
This is a patent infringement dispute.
The plaintiff alleges that in the early 1990s, he invented a
safe-acid technology for use in food processing, in the military to
neutralize germ-warfare agents, and as a general disinfectant. The
plaintiff and others then formed SteriFx, Inc., later succeeded by
Synergy Technologies, Inc., for the purpose of exploiting the safeacid technology.
After disagreements, the plaintiff alleges that
SteriFx and Synergy stole his patent rights to the safe-acid
technology.
In April 2011, the plaintiff filed a voluntary petition for
bankruptcy under Chapter 13.
At no time during the bankruptcy
proceedings did he disclose ownership of any intellectual property
rights,
including
rights
to
the
safe-acid
technology.
The
plaintiff specifically represented to the bankruptcy court that he
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did not have an interest in any contingent or unliquidated claims
of any kind.
The bankruptcy court entered four separate plan
confirmation orders before dismissing the case without discharge in
July 2013, based on the plaintiff's failure to timely make required
payments.
In December 2013, the plaintiff filed this lawsuit against
SteriFX and Synergy alleging claims of patent infringement, fraud,
breach of contract, and theft. The defendants now move for summary
judgment on the issue of judicial estoppel.
I.
Summary Judgment Standard
Federal Rule of Civil Procedure 56 instructs that summary
judgment is proper if the record discloses no genuine issue as to
any material fact such that the moving party is entitled to
judgment as a matter of law.
No genuine issue of fact exists if
the record taken as a whole could not lead a rational trier of fact
to find for the non-moving party.
See Matsushita Elec. Indus. Co.
v. Zenith Radio., 475 U.S. 574, 586 (1986).
A genuine issue of
fact exists only "if the evidence is such that a reasonable jury
could return a verdict for the non-moving party."
Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
The Court emphasizes that the mere argued existence of a
factual dispute does not defeat an otherwise properly supported
motion.
See
id.
Therefore,
"[i]f
the
evidence
is
merely
colorable, or is not significantly probative," summary judgment is
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appropriate.
Id. at 249-50 (citations omitted).
Summary judgment
is also proper if the party opposing the motion fails to establish
an essential element of his case.
477 U.S. 317, 322-23 (1986).
See Celotex Corp. v. Catrett,
In this regard, the non-moving party
must do more than simply deny the allegations raised by the moving
party.
See Donaghey v. Ocean Drilling & Exploration Co., 974 F.2d
646, 649 (5th Cir. 1992).
Rather, he must come forward with
competent evidence, such as affidavits or depositions, to buttress
his claims.
Id.
Hearsay evidence and unsworn documents that
cannot be presented in a form that would be admissible in evidence
at trial do not qualify as competent opposing evidence.
Martin v.
John W. Stone Oil Distrib., Inc., 819 F.2d 547, 549 (5th Cir.
1987); Fed. R. Civ. P. 56(c)(2).
Finally, in evaluating summary
judgment, the Court must read the facts in the light most favorable
to the non-moving party.
II.
Anderson, 477 U.S. at 255.
Law & Application
"The doctrine of judicial estoppel is equitable in nature and
can be invoked by a court to prevent a party from asserting a
position in a legal proceeding that is inconsistent with a position
taken in a previous proceeding."
F.3d 258, 261 (5th Cir. 2012).
Love v. Tyson Foods, Inc., 677
"The aim of the doctrine is to
'protect the integrity of the judicial process.'" Id. (quoting New
Hampshire v. Maine, 532 U.S. 742, 749-50 (2001)).
In determining whether to apply judicial estoppel, the Court
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primarily considers whether: "(1) the party against whom judicial
estoppel is sought has asserted a legal position which is plainly
inconsistent with a prior position; (2) a court accepted the prior
position; and (3) the party did not act inadvertently."
Reed v.
City of Arlington, 650 F.3d 571, 574 (5th Cir. 2011)(en banc).
However, the doctrine should not be applied inflexibly or without
due consideration for the specific factual context. Love, 677 F.3d
at 261.
The Fifth Circuit has held that judicial estoppel may be
"particularly appropriate where . . . a party fails to disclose an
asset to a bankruptcy court, but then pursues a claim in a separate
tribunal based on that undisclosed asset."
Jethroe v. Omnova
Solutions, Inc., 412 F.3d 598, 600 (5th Cir. 2005).
The
defendants
submit
that
there
is
no
genuine
dispute
regarding any of the criteria for judicial estoppel. They contend
that the plaintiff's current patent infringement claims contradict
his previous position that he had no intellectual property assets
or contingent claims, that the bankruptcy court accepted the
plaintiff's prior position, and that the plaintiff purposefully
concealed his alleged patent rights from the bankruptcy court. The
plaintiff counters that he only learned he might still own the
contested patents upon meeting with an intellectual property lawyer
after his bankruptcy case was dismissed, and thus, that his current
claims are not plainly inconsistent with his previous position and
that any misrepresentation to the bankruptcy court was inadvertent.
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The
plaintiff
also
contends
that
because
his
bankruptcy
was
dismissed without discharge, the bankruptcy court never accepted
any representation that he had no patent rights.
The Court is persuaded that this record does not establish
judicial acceptance, although the content of the bankruptcy papers
will be of considerable interest at trial.
The bankruptcy court
may have revoked any acceptance when it dismissed the plaintiff's
bankruptcy without a discharge. Wells Fargo Bank, N.A. v. Oparaji,
698 F.3d 231, 237-38 (5th Cir. 2012)(reasoning that the predischarge dismissal of a bankruptcy case returns the parties to the
status quo ante).
Material facts are in dispute.
See id.
Summary
judgment is inappropriate on this record.
Accordingly, the defendants' motion for summary judgment is
DENIED.
New Orleans, Louisiana, June 4, 2014
_______________________________
MARTIN L. C. FELDMAN
UNITED STATES DISTRICT JUDGE
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