George v. Fresenius Medical Care North America et al

Filing 37

RULING denying BMS'S 20 Motion for Summary Judgment on the Issue of Judicial Estoppel. Signed by Magistrate Judge Richard L. Bourgeois, Jr on 5/27/2016. (LLH)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF LOUISIANA
TAMMY GEORGE
CIVIL ACTION
VERSUS
NO. 15-14-RLB
FRESENIUS MEDICAL CARE
NORTH AMERICA, ET AL.

CONSENT CASE

RULING ON MOTION FOR SUMMARY JUDGMENT
Before the Court is defendant Bio-Medical Applications of Louisiana, LLC’s (“BMA”)1
Motion for Summary Judgment on the issue of Judicial Estoppel (R. Doc. 20) filed on January
21, 2016. The motion is opposed. (R. Doc. 22). BMA has filed a Reply. (R. Doc. 23).
I.

Background
This is an employment discrimination action. Tammy George (“Plaintiff”) alleges that

while she was employed by BMA as a hemodialysis technician, she was discriminated against by
her supervisor and was subjected to a hostile work environment based on her race (AfricanAmerican) and her disabilities (breast cancer and lymphedema). (R. Doc. 1-1, “Petition,” ¶¶ 3,
5). Plaintiff brings her claims under Title VII of the Civil Rights Act of 1964, and the Americans
with Disabilities Act.
Resolution of the instant motion for summary judgment turns upon whether Plaintiff is
judicially estopped from pursuing her claims because she did not report her potential
discrimination lawsuit during an earlier bankruptcy proceeding.
On August 17, 2011, Plaintiff filed a Chapter 13 bankruptcy petition in the U.S.
Bankruptcy Court for the Middle District of Louisiana and submitted her list of assets. See In re

BMA asserts that it was wrongly identified as “Fresenius Medical Care North America” in the Petition. (R. Doc.
20 at 1).
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Tammy Taranetta George, No. 11-11300 (Bankr. M.D. La.) (“George Bankr.”), ECF Nos. 1, 2;
(R. Docs. 20-4, 20-6).
On August 18, 2011, Plaintiff submitted her bankruptcy plan. George Bankr., ECF No.
10; (R. Doc. 20-8).
On October 28, 2011, Plaintiff amended her list of assets and amended her bankruptcy
plan. George Bankr., ECF Nos. 21, 24; (R. Docs. 20-7, 20-9).
On November 18, 2011, the Bankruptcy Court issued an order confirming Plaintiff’s
debtor plan as amended. George Bankr., ECF No. 25; (R. Doc. 20-10).
On September 11, 2013, Plaintiff filed a Charge of Discrimination with the Louisiana
Commission on Human Rights, asserting that the alleged acts of discrimination began on
September 4, 2012. (R. Doc. 20-2 at 4). Plaintiff’s Notice of Charge of Discrimination with the
U.S. Equal Employment Opportunity Commission (“EEOC”) was filed on September 13, 2013.
(R. Doc. 20-2 at 3). There is no dispute that Plaintiff did not inform the Bankruptcy Court of the
EEOC Charge or otherwise amended her summary of schedules to add the EEOC Charge. (R.
Doc. 20-5 at 2-3, George Dep. Tr. 26:24-27:15).
On August 25, 2014, Plaintiff received a Notice of Right to Sue from the EEOC. (R. Doc.
20-2 at 5).
On October 7, 2014, the Chapter 13 Trustee moved to dismiss Plaintiff’s bankruptcy
action in light of her failure to make payments in accordance with the terms of the bankruptcy
plan. George Bankr., ECF No. 34. The records submitted by the Chapter 13 Trustee indicate
that Plaintiff stopped making any payments in July of 2014. Id. at 2.

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On November 4, 2014, the Bankruptcy Court granted the Trustee’s motion, which was
unopposed, and dismissed Plaintiff’s bankruptcy proceeding in light of Plaintiff’s non-payments.
George Bankr., ECF No. 37; (R. Doc. 20-11).
On November 21, 2014, Plaintiff initiated this action in state court. (R. Doc. 1-1 at 2-5).
Defendant removed the action on January 12, 2015. (R. Doc. 1).
II.

Law and Analysis
A.

Summary Judgment Standard

Pursuant to well-established legal principles, summary judgment is appropriate where
there is no genuine disputed issue as to any material fact, and the moving party is entitled to
judgment as a matter of law. Fed. R. Civ. P. 56; Celotex Corp. v. Catrett, 477 U.S. 317 (1986);
Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986). A party moving for summary judgment
must inform the Court of the basis for the motion and identify those portions of the pleadings,
depositions, answers to interrogatories and admissions on file, together with affidavits, if any,
that show that there is no such genuine issue of material fact. Celotex, 477 U.S. at 323. If the
moving party carries its burden of proof under Rule 56, the opposing party must direct the
Court’s attention to specific evidence in the record which demonstrates that the non-moving
party can satisfy a reasonable jury that it is entitled to a verdict in its favor. Anderson, 477 U.S.
at 248. This burden is not satisfied by some metaphysical doubt as to alleged material facts, by
unsworn and unsubstantiated assertions, by conclusory allegations, or by a mere scintilla of
evidence. Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994). Rather, Rule 56
mandates that summary judgment be entered against a party who fails to make a showing
sufficient to establish the existence of an element essential to that party’s case and on which that
party will bear the burden of proof at trial. Celotex, 477 U.S. at 323. Summary judgment is

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appropriate in any case where the evidence is so weak or tenuous on essential facts that the
evidence could not support a judgment in favor of the non-moving party. Little, 37 F.3d at 1075.
In resolving a motion for summary judgment, the Court must review the facts and inferences in
the light most favorable to the non-moving party, and the Court may not evaluate the credibility
of witnesses, weigh the evidence, or resolve factual disputes. International Shortstop, Inc. v.
Rally’s, Inc., 939 F.2d 1257, 1263 (5th Cir. 1991).
B.

Judicial Estoppel

Judicial estoppel is “a common law doctrine by which a party who has assumed one
position in his pleadings may be estopped from assuming an inconsistent position.” In re Coastal
Plains, Inc., 179 F.3d 197, 205 (5th Cir. 1999). “It goes without saying that the Bankruptcy
Code and Rules impose upon bankruptcy debtors an express, affirmative duty to disclose all
assets, including contingent and unliquidated claims.” Id. at 207-208. 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); see In re Flugence,
738 F.3d 126 (5th Cir. 2013); Love v. Tyson Foods, Inc., 677 F.3d 258 at 262-264 (5th Cir.
2012); Kamont v. West, 83 Fed. App’x. 1, No. 03-60392, 2003 WL 22477703, at *3 (5th Cir.
2003).
The Fifth Circuit looks to the following three criteria when determining whether judicial
estoppel is appropriate: “(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.” Love, 677 F.3d at 261. “The policies
underlying the doctrine include preventing internal inconsistency, precluding litigants from

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playing fast and loose with the courts, and prohibiting parties from deliberately changing
positions according to the exigencies of the moment.” United States v. McCaskey, 9 F.3d 368,
378 (5th Cir. 1993). The doctrine should not, however, be applied inflexibly or without due
consideration for the specific factual context. Love, 677 F.3d at 261.
The first prong—whether Plaintiff asserted a legal position in this proceeding which is
plainly inconsistent with a prior position asserted in the bankruptcy proceeding—is satisfied.
Failure to disclose an EEOC charge to the bankruptcy court satisfies this prong. See Woodruff v.
Enter. Leasing Co. of New Orleans, No. 10-536, 2012 WL 243436, at *2 (M.D. La. Jan. 25,
2012). That the alleged discrimination and EEOC filing occurred after the initiating of the
bankruptcy action is of no event. Plaintiff had a continuing duty to disclose assets obtained
during the pendency of her Chapter 13 bankruptcy proceeding. See 11 U.S.C. § 1306; Flugence,
738 F.3d at 129 (“Chapter 13 debtors have a continuing obligation to disclose post-petition
causes of action.”). The alleged discrimination, Plaintiff’s filing of an EEOC charge, and
Plaintiff’s receipt of a right-to-sue letter all occurred during the pendency of the bankruptcy
proceeding. There is no dispute that Plaintiff never informed the bankruptcy court of her
potential discrimination lawsuit, which she filed just weeks after the dismissal of her bankruptcy
proceeding. Based on these facts, the first prong is satisfied.
The Court finds, however, that the second prong—whether the bankruptcy court accepted
Plaintiff’s prior inconsistent position—is not satisfied. Generally speaking, the bankruptcy court
can “accept” a plaintiff’s prior position without knowledge of the potential lawsuit where the
plaintiff’s bankruptcy claims are discharged. See, e.g., Woodruff, 2012 WL 243436, at *2-3. In
this action, there was no discharge; instead, the proceeding was dismissed in light of Plaintiff’s
failure to make payments in accordance with the bankruptcy plan. The effect of a “pre-discharge

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dismissal of bankruptcy case” pursuant to 11 U.S.C. § 349(b) “returns the parties to the positions
they were in before the case was initiated.” In re Oparaji, 698 F.3d 231, 237 (5th Cir. 2012)
(quoting In re Sanitate, 415 B.R. 98, 104 (Bankr. E.D. Pa. 2009). “[W]hen a debtor fails to
fulfill [her] end of the bargain because of the dismissal of their case, a resulting finding that their
confirmed Chapter 13 plan is terminated serves to prevent a debtor from obtaining the benefit of
those terms in a plan which are advantageous to the debtor.” In re Oparaji, 698 F.3d at 238
(quoting In re Hufford, 460 B.R. 172, 177 (Bankr. N.D. Ohio 2011)). Plaintiff’s bankruptcy
proceeding was dismissed without discharge.2 In Oparaji, the court explained that the dismissal
of the plan “negated” the bankruptcy court’s acceptance of that plan.
At least two district courts in the Fifth Circuit have refused to find judicial estoppel in light of the
analysis in Oparaji. See Ware v. U.S. Bank Nat. Ass'n, 131 F. Supp. 3d 573, 576 (S.D. Miss.
2015) (citing Oparaji, 698 F.3d at 237-38); Roden v. Synergy Technologies, Inc., No. 13-6753,
2014 WL 2533718 (E.D. La. June 4, 2014) (citing Oparaji, 698 F.3d at 237-38). Accordingly,
Defendants have not established judicial acceptance of Plaintiff’s prior position.
Because the second prong is not satisfied, the Court need not consider whether the third
prong—whether Plaintiff acted inadvertently—is satisfied.3

The Fifth Circuit has subsequently characterized its analysis in Oparaji, “whether dismissal of bankruptcy without
discharge constitutes a revocation of acceptance,” as dicta. See Allen v. C & H Distributors, L.L.C., 813 F.3d 566,
573 n.5 (5th Cir. 2015) (distinguishing “dismissal” of bankruptcy proceeding from “closure” of bankruptcy
proceeding without discharge); see also 11 U.S.C. § 349 (“Effect of dismissal”) and 11 U.S.C. § 350 (“Closing and
reopening cases”).
3
The parties devote a considerable amount of their briefing to this issue. (R. Doc. 20-1 at 8-12; R. Doc. 22; R. Doc.
23). While the Court does not reach the issue of whether Plaintiff acted with inadvertence, it notes that Plaintiff has
not received any tangible benefit from her failure to disclose the EEOC charge and/or EEOC right-to-sue letter in
the bankruptcy proceeding. As noted by the Fifth Circuit, “[a]t its core, judicial estoppel is an equitable remedy
[that] must be applied so as to avoid inequity.” In re Oparaji, 698 F.3d at 238 (quotation omitted). Accordingly,
even if the bankruptcy court’s dismissal of the bankruptcy proceeding “had not negated its earlier acceptance, equity
would still counsel against the application of judicial estoppel.” See id.
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III.

Conclusion
For the foregoing reasons, judicial estoppel of Plaintiff’s claims in this action is not

merited in light of her failure to disclose those claims in the bankruptcy proceeding.
IT IS ORDERED that BMA’s Motion for Summary Judgment on the Issue of Judicial
Estoppel (R. Doc. 20) is DENIED.
Signed in Baton Rouge, Louisiana, on May 27, 2016.

S

RICHARD L. BOURGEOIS, JR.
UNITED STATES MAGISTRATE JUDGE

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