Johnson v. First Technology Federal Credit Union et al
Filing
41
MEMORANDUM AND ORDER granting 24 MOTION for Summary Judgment and Incorporated Memorandum In Support (Signed by Judge Ewing Werlein, Jr) Parties notified.(kcarr, )
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
JOE JOHNSON,
§
§
§
§
§
§
§
§
§
§
§
§
§
Plaintiff,
v.
FIRST TECHNOLOGY FEDERAL
CREDIT UNION d/b/a ADDISON
AVENUE FEDERAL CREDIT UNION;
and ADDISON AVENUE FEDERAL
CREDIT UNION,
Defendants.
CIVIL ACTION NO. H-11-3812
MEMORANDUM AND ORDER
Pending is Defendants First Technology Federal Credit Union
d/b/a Addison Avenue Federal Credit Union and Addison Avenue
Federal Credit Union’s (“Defendants”) Motion for Summary Judgment
(Document
No.
24).
After
carefully
considering
the
motion,
response, reply, and applicable law, the Court concludes for the
reasons that follow that the motion should be granted.
I.
Background
Plaintiff Joe Johnson (“Plaintiff”) was employed by Defendants
until they terminated his employment on July 13, 2009.1
The next
month Plaintiff filed for bankruptcy in the Southern District of
Texas, and six months later his debts were discharged.2
1
Document No. 1 ¶¶ 16, 62.
2
Document No. 24 at 2.
On
April
30,
2010,
about
bankruptcy,
Plaintiff
Retaliation
against
ten
filed
weeks
a
to
Sue
letter,
Defendants
and
his
Charge
Opportunity Commission (“EEOC”).3
Right
after
of
with
the
discharge
from
Discrimination
Equal
and
Employment
The EEOC subsequently issued a
Plaintiff
timely
filed
this
action
alleging violations of the Americans with Disabilities Act (“ADA”)
and the Age Discrimination in Employment Act (“ADEA”).4
Defendants
move for summary judgment.
II.
Legal Standard
Rule 56(a) provides that “[t]he court shall grant summary
judgment if the movant shows that there is no genuine dispute as to
any material fact and the movant is entitled to judgment as a
matter of law.”
FED . R. CIV . P. 56(a).
Once the movant carries
this burden, the burden shifts to the nonmovant to show that
summary judgment should not be granted. Morris v. Covan World Wide
Moving, Inc., 144 F.3d 377, 380 (5th Cir. 1998).
3
A party opposing
Document No. 1 ¶ 12.
4
Id. ¶¶ 1, 13. Plaintiff contends that he is an individual
with a disability as defined by the ADA because he underwent a
heart procedure in June 2009. Id. ¶ 78. Plaintiff alleges he was
terminated by Defendant due to disability discrimination, in
violation of the ADA, because he was terminated less than a month
after the heart procedure. Id. ¶¶ 36, 77-84. Plaintiff further
alleges he was over 40 years of age and therefore in the ADEA’s
protected class, that the alleged facts regarding his termination
show “Defendant intended to discriminate against Plaintiff on the
basis of his age,” and that he also was replaced by a younger
worker. Id. ¶ 55-63.
2
a properly-supported motion for summary judgment may not rest upon
mere allegations or denials in a pleading, and unsubstantiated
assertions that a fact issue exists will not suffice.
Id.
“[T]he
nonmoving party must set forth specific facts showing the existence
of a ‘genuine’ issue concerning every essential component of its
case.”
Id.
“A party asserting that a fact cannot be or is
genuinely disputed must support the assertion by: (A) citing to
particular parts of materials in the record . . .; or (B) showing
that the materials cited do not establish the absence or presence
of a genuine dispute, or that an adverse party cannot produce
admissible evidence to support the fact.”
FED . R. CIV . P. 56(c)(1).
“The court need consider only the cited materials, but it may
consider other materials in the record.” Id. 56(c)(3).
In considering a motion for summary judgment, the district
court must view the evidence “through the prism of the substantive
evidentiary burden.”
Anderson v. Liberty Lobby, Inc., 106 S. Ct.
2505, 2513 (1986). All justifiable inferences to be drawn from the
underlying facts must be viewed in the light most favorable to the
nonmoving party.
Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 106 S. Ct. 1348, 1356 (1986).
“If the record, viewed in
this light, could not lead a rational trier of fact to find” for
the nonmovant, then summary judgment is proper.
Kelley v. Price-
Macemon, Inc., 992 F.2d 1408, 1413 (5th Cir. 1993).
On the other
hand, if “the factfinder could reasonably find in [the nonmovant’s]
3
favor, then summary judgment is improper.”
Id.
Even if the
standards of Rule 56 are met, a court has discretion to deny a
motion for summary judgment if it believes that “the better course
would be to proceed to a full trial.”
Anderson, 106 S. Ct. at
2513.
III.
Analysis
Defendants argue that Plaintiff is barred from prosecuting
this
action
bankruptcy
by
the
doctrine
schedules,
of
Plaintiff
judicial
was
estoppel.5
required
to
On
list:
his
“Other
contingent and unliquidated claims of every nature, including tax
refunds,
claims.”6
counterclaims
of
the
debtor,
and
rights
Plaintiff answered under oath, “None.”
to
setoff
Defendants
allege that because Plaintiff did not disclose his employment
discrimination
claims
against
them
during
his
bankruptcy
proceedings, he is estopped from now pursuing those claims.7
Summary judgment is appropriate when a claim is estopped under
the doctrine of judicial estoppel.
See Jethroe v. Omnova Solu-
tions, Inc., 412 F.3d 598, 599 (5th Cir. 2005).
Judicial estoppel
is an equitable doctrine, and its determination is subject to the
discretion of the court.
In re Coastal Plains, Inc., 179 F.3d 197,
5
Document No. 24 at 6.
6
Document No. 24-2, ex. G at 24.
7
Document No. 24 at 6.
4
205 (5th Cir 1999).
The Fifth Circuit has described the doctrine
of judicial estoppel as:
[A] common law doctrine by which a party who has assumed
one position in his pleadings may be estopped from
assuming an inconsistent position. . . . The purpose of
the doctrine is to protect the integrity of the judicial
process . . . .
The policies underlying the doctrine include
preventing internal inconsistency, precluding litigants
from playing fast and loose with the courts, and
prohibiting parties from deliberately changing positions
according to the exigencies of the moment.
Id. at 205-06 (internal quotation marks and citations omitted).
Judicial estoppel applies if (1) the position of the party
against whom estoppel is sought is plainly inconsistent with its
prior legal position; (2) the court accepted the prior position;
and (3) that party did not act inadvertently.8
Love v. Tyson
Foods, Inc., 677 F.3d 258, 261 (5th Cir. 2012).
Whether or not
judicial
estoppel
prerequisites
or
applicability,’
doctrine’s
applies
an
and
is
not
exhaustive
numerous
application
in
determined
formula
for
considerations
specific
8
factual
by
“‘inflexible
determining
‘may
[its]
inform
the
contexts.’”
Id.
Judicial estoppel is unlike equitable estoppel in that
detrimental reliance of the opposing party is not required. See
Coastal, 179 F.3d at 205. The differing requirements result from
the differing purposes of the two doctrines.
Id.
Judicial
estoppel is intended to protect the judicial system, whereas
equitable estoppel is intended to protect the litigants. Id.
5
(alteration in original) (quoting N.H. v. Me., 532 U.S. 742, 751
(2001)).
The doctrine of judicial estoppel is “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
Jethroe,
412
asset.”
F.3d
at
Love,
600).
677
F.3d
Moreover,
at
in
261-62
the
(quoting
context
of
a
bankruptcy proceeding, “the importance of this disclosure duty
cannot
be
overemphasized.”
Coastal,
179
F.3d
at
208.
The
Bankruptcy Code and Rules impose on the bankruptcy debtor an
“express,
affirmative
duty
to
disclose
contingent and unliquidated claims.”
all
assets,
including
Id. at 207-08 (emphasis in
original).
The Fifth Circuit imposes on the bankruptcy debtor a broad
duty to disclose, stating:
The duty of disclosure in a bankruptcy proceeding is a
continuing one, and a debtor is required to disclose all
potential causes of action. . . . The debtor need not
know all the facts or even the legal basis for the cause
of action; rather, if the debtor has enough information
. . . prior to confirmation to suggest that it may have
a possible cause of action, then that is a “known” cause
of action such that it must be disclosed. . . . Any claim
with potential must be disclosed, even if it is
contingent, dependent, or conditional.
Id. at 208 (emphasis in original) (quotation marks and citations
omitted) (quoting Youngblood Grp. v. Lufkin Fed. Sav. & Loan Ass’n,
932 F. Supp. 859, 867 (E.D. Tex. 1996)).
6
A.
Inconsistent Positions
The Fifth Circuit has held that inconsistent positions exist
where
a
debtor
fails
to
disclose
a
potential
claim
in
his
bankruptcy schedules or stipulations and subsequently pursues that
claim.
See Coastal, 179 F.3d at 210.
Plaintiff argues that he has
not taken inconsistent positions because he did not file a Charge
of Discrimination against Defendants with the EEOC until two months
after the conclusion of the bankruptcy proceedings.9
Nonetheless,
inconsistent positions exist when the facts that give rise to that
claim accrue before or during the bankruptcy proceeding, even if
the plaintiff does not assert the claim until after the bankruptcy
proceeding.
See Liddell v. Northrop Grumman Shipbuilding, Inc.,
No. 1:06CV801-HSO-JMR, 2011 WL 3841383, at *5 (S.D. Miss. 2011)
(“This question turns on whether any of Plaintiff’s claims asserted
in this case had accrued at the crucial time, the time she filed
the Chapter 7 bankruptcy Petition.”); In re Broussard, 351 B.R.
383, 387 (Bankr. W.D. La. 2006) (finding inconsistent positions and
rejecting debtor’s argument that he did not know of personal injury
claim prior to filing of bankruptcy where debtor was under medical
treatment during bankruptcy proceeding but began seeking legal
advice immediately after discharge).
9
Document No. 30 at 9-10.
7
When Plaintiff filed his bankruptcy petition, the basic facts
and circumstances giving rise to his employment discrimination
claims had already occurred and were known to Plaintiff, namely,
that he was over 40 years of age and therefore in ADEA’s protected
class when he was discharged and that, less than one month before
his discharge, he had undergone a heart procedure, following which
he
returned
to
work
in
only
three
days
notwithstanding
his
physician’s advice to take long-term disability or at least a few
weeks off work to recover. Plaintiff consulted with his employment
discrimination lawyer about his allegedly wrongful termination
before he filed his bankruptcy action.10
But when he filed his
bankruptcy schedule, he made no disclosure that he had any present
or potential employment discrimination claim.
Instead, Plaintiff
stated under oath that he had no “other contingent or unliquidated
claim[] of [any] nature. . . .”
bankruptcy
court
is
directly
position in this lawsuit.
This representation to the
contrary
to
Plaintiff’s
current
See Liddell, 2011 WL 3841383, at *5
(finding, in 2001 discrimination suit, that plaintiff’s claims for
discrete acts of discrimination occurring prior to January 21,
1997, were inconsistent with her nondisclosure of those claims in
her bankruptcy petition filed on that date).
10
Document No. 30-1, ex. 1 ¶¶ 15-16.
8
B.
Acceptance by the Bankruptcy Court
The second element of judicial estoppel requires “that the
first court has adopted the position urged by the party, either as
a preliminary matter or as part of a final disposition.”
In re
Superior
2004)
Crewboats,
Inc.,
374
F.3d
330,
335
(5th
Cir.
(quoting Coastal, 179 F.3d at 206); see Liddell, 2011 WL 3841383,
at *7 (holding that the bankruptcy court relied, at least in part,
on the debtor’s bankruptcy schedules by discharging her debts). It
is uncontroverted that the bankruptcy court accepted Plaintiff’s
prior position, found he had no property or claims, and discharged
his debt.11
C.
Inadvertence
Inadvertence is shown by proving that the party against whom
judicial estoppel is sought “lacks knowledge of the undisclosed
claims or has no motive for their concealment.”
Coastal, 179 F.3d
at 210 (emphasis in original); see also Jethroe, 412 F.3d at 600-01
(“To establish that her failure to disclose was inadvertent,
Jethroe may prove either that she did not know of the inconsistent
position or that she had no motive to conceal it from the court.”).
Plaintiff contends that his nondisclosure was inadvertent
because
11
he
was
not
aware
of
all
the
See Document 24-2, ex. I at 47.
9
facts
surrounding
his
termination and was unsure if he had a claim against Defendants.12
However, as noted above, “[t]he debtor need not know all the facts
or even the legal basis for the cause of action” for the duty to
disclose to arise.
Coastal, 179 F.3d at 208 (quoting Youngblood,
932 F. Supp. at 867). The uncontroverted summary judgment evidence
is
that
Plaintiff
actually
met
with
his
attorney
about
his
allegedly wrongful termination before initiating his bankruptcy
proceeding.13
Moreover, within five days after being terminated
Plaintiff had sent an email to Defendant in which he complained
about his unfair termination, pointing out that it came shortly
after he had taken three days off for heart surgery.14
This is the
exact factual predicate for his present disability discrimination
claim.
The uncontroverted summary judgment evidence establishes
that when Plaintiff commenced his bankruptcy proceeding and filed
his schedules, swearing that he had no “contingent and unliquidated
claims of [any] nature,” he was fully informed of the essential
facts and basis for his employment discrimination claims against
his former employer.
Plaintiff had reason not to disclose his claims against his
employer in order to avoid the use of his recovered damages to pay
his unsecured debts.
See Love, 677 F.3d at 262 (quoting Thompson
12
Document No. 30 at 11.
13
Document No. 30-1, ex. 1 ¶¶ 15-16.
14
Document No. 24-1, ex. B at 3.
10
v. Sanderson Farms, Inc., No. 3:04CV837-WHB-JCS, 2006 U.S. Dist.
LEXIS
48409,
at
*12-13
(S.D.
Miss.
May
31,
2006))
(“[T]he
motivation sub-element is almost always met if a debtor fails to
disclose a claim or possible claim to the bankruptcy court.”);
Jethroe,
412
F.3d
at
601
(finding
that
the
plaintiff
was
sufficiently motivated to conceal her claims because by doing so,
she was not required to pay her unsecured debt of $8,373); see also
In re Jackson, No. 06-36268, 2012 WL 3071218, at *32 (Bankr. S.D.
Tex. July 27, 2012) (“[T]his Court sees no logical reason why the
very high bar that the Fifth Circuit has established in Love for
debtors to prove that they had no motive to conceal a cause
of action should be any lower when debtors are attempting to
prove that they had no motive to conceal any other type of
asset. . . .”).
Moreover, during the six months that his bankruptcy proceeding
was pending, Plaintiff never amended his Schedule to disclose his
employment discrimination claims against his employer, but after
receiving his discharge from bankruptcy, he proceeded within a
matter of weeks to file those claims in the EEOC.
The elements of
judicial estoppel are fully established in the summary judgment
evidence,
and
Plaintiff
is
judicially
recovery on those claims.
11
estopped
from
seeking
IV.
Order
Based on the foregoing, it is
ORDERED that Defendants First Technology Federal Credit Union
d/b/a Addison Avenue Federal Credit Union and Addison Avenue
Federal
Credit
Union’s
Motion
for
Summary
Judgment
(Document
No. 24) is GRANTED, and Plaintiff Joe Johnson’s claims against
Defendants are DISMISSED on the merits.
The Clerk will enter this Order, providing a correct copy to
all counsel of record.
SIGNED in Houston, Texas, this 18th day of July, 2013.
____________________________________
EWING WERLEIN, JR.
UNITED STATES DISTRICT JUDGE
12
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?