Slater v. U.S. Steel Corp., 022416 FED11, 12-15548
|Opinion Judge:||PER CURIAM:|
|Party Name:||SANDRA SLATER, Plaintiff - Appellant, v. U.S. STEEL CORPORATION, Defendant-Appellee.|
|Judge Panel:||Before TJOFLAT and WILLIAM PRYOR, Circuit Judges, and SCOLA, District Judge. TJOFLAT, Circuit Judge, specially concurring:|
|Case Date:||February 24, 2016|
|Court:||United States Courts of Appeals, Court of Appeals for the Eleventh Circuit|
Appeal from the United States District Court for the Northern District of Alabama D.C. Docket No. 2:09-cv-01732-KOB.
The equitable doctrine of judicial estoppel, also known as the doctrine of preclusion of inconsistent positions, "precludes a party from asserting a . . . position that contradicts or is inconsistent with a prior position taken by the same party." 18 James Wm. Moore et al., Moore's Federal Practice ¶ 131.13[a] (3d ed. 2015). The doctrine differs from the doctrines of issue and claim preclusion in that the policy animating it "is not [primarily] concerned with preserving the finality of judgments" but is concerned, instead, with "the orderly administration of justice and regard for the dignity of court proceedings." Id. ¶ 131.13[c]. The doctrine may be invoked by a third party: that is, someone who was not a party in the adversary's prior proceeding and therefore would suffer no prejudice were the adversary permitted to go forward with the inconsistent position. Id. ¶ 134.33.1
This is so in our circuit. We do not require that the party invoking the doctrine have been a party in the prior proceeding. "The doctrine of judicial estoppel protects the integrity of the judicial system, not the litigants; therefore, . . . [w]hile privity and/or detrimental reliance are often present in judicial estoppel cases, they are not required." Burnes v. Pemco Aeroplex, Inc., 291 F.3d 1282, 1286 (11th Cir. 2002) (alteration in original) (quotation marks omitted) (quoting Ryan Operations G.P. v. Santiam-Midwest Lumber Co., 81 F.3d 355, 360 (3d Cir. 1996)).
The case at hand is an employment-discrimination action brought by Sandra Slater against United States Steel Corporation ("U.S. Steel"), her former employer.2 Slater raises two issues on appeal: (1) whether the District Court correctly granted summary judgment to U.S. Steel on her claim for "racial . . . discrimination, " and (2) whether the District Court correctly dismissed other employment-discrimination claims based on judicial estoppel that had proceeded past summary judgment and were set for trial. We affirm the District Court on both issues.3
Twenty-one months after bringing this lawsuit, Slater, represented by separate counsel, filed a Chapter 7 bankruptcy petition.4 In filling out the Statement of Financial Affairs part of her petition, Slater, under penalty of perjury, answered "none" to the Personal Property Schedule B question asking whether she had any "contingent and unliquidated claims" and "none" to the Statement of Financial Affairs question asking whether she was, or had been within one year immediately preceding the filing of her petition, "a party" to any "suits and administrative proceedings."
When U.S. Steel learned of the bankruptcy case-that Slater's Chapter 7 petition had not disclosed the employment-discrimination claims she was pursuing against it in the District Court and that the Chapter 7 Trustee was treating the bankruptcy as a "no asset" case5 and had filed a Report of No Distribution with the Bankruptcy Court-it moved the District Court alternatively to dismiss the case or for summary judgment. U.S. Steel argued that the case should be dismissed because Slater lacked standing to prosecute it6 or that summary judgment should be granted under the doctrine of judicial estoppel pursuant to Burnes v. Pemco Aeroplex, Inc., 291 F.3d 1282 (11th Cir. 2002), and its progeny.7 Burnes was an employment-discrimination case like Slater's that was dismissed because the plaintiff, who was in bankruptcy, failed to disclose the pendency of federal-district-court litigation to the Bankruptcy Court.
On receiving U.S. Steel's alternative motions, Slater immediately amended her bankruptcy petition to identify her lawsuit against U.S. Steel and the claims being litigated.8 Slater also filed with the District Court a memorandum in opposition to U.S. Steel's motions and an affidavit stating that she did not intentionally withhold mention of her lawsuit in her bankruptcy petition and that when she realized what she had done, she had her bankruptcy attorney amend her answers to the Statement of Financial Affairs questions to reveal the current litigation.
In her memorandum, Slater argued that invoking the doctrine of judicial estoppel would be inappropriate for three reasons, two based on the United States Supreme Court's decision in New Hampshire v. Maine, 532 U.S. 742, 121 S.Ct. 1808, 149 L.Ed.2d 968 (2001), the third based on the Fourth Circuit's decision in Folio v. City of Clarksburg, 134 F.3d 1211 (4th Cir. 1998). First, Slater argued that judicial estoppel would be inappropriate under New Hampshire because she had not "'succeeded in persuading [the bankruptcy] court to accept [her] position'" that she had no claims pending against U.S. Steel, because she had not yet received a discharge of her debts by the Bankruptcy Court, and therefore had created "'no risk of inconsistent court determinations'" that could pose a "threat to judicial integrity." Second, Slater contended that judicial estoppel should not be invoked because allowing her employment-discrimination case to go forward would not give her an "'unfair advantage or impose an unfair detriment on'" U.S. Steel. And third, to be estopped, Slater argued that she "must have acted intentionally, not inadvertently" in failing to disclose the litigation against U.S. Steel in her Chapter 7 petition and, as indicated in her affidavit, her failure to disclose her claims and the litigation was inadvertent.
While U.S. Steel's alternative motions were pending, the following occurred. First, the Bankruptcy Court approved the application of the trustee of Slater's bankruptcy estate to employ the lawyers representing Slater in her case against U.S. Steel as special counsel for the bankruptcy estate and, in that capacity, continue to pursue the claims being litigated. Second, a short time later, Slater, through counsel, petitioned the court to convert her Chapter 7 case to a Chapter 13 case. The court granted her motion, and Slater promptly filed a Chapter 13 petition and an Amended Personal Property Schedule B. Three months later, the Bankruptcy Court affirmed the plan Slater proposed for the payment of her debts over a period of forty-two months.
The District Court ruled on U.S. Steel's alternative motions while Slater's plan was being carried out. The court declared moot U.S. Steel's motion to dismiss the case on the ground that Slater lacked standing. A Chapter 13 debtor has standing to prosecute a claim of the bankruptcy estate as the debtor in possession, 9 and the court found that Slater was appearing in that capacity.
The District Court concluded that the doctrine of judicial estoppel as formulated in Burnes v. Pemco Aeroplex, Inc., 291 F.3d 1282 (11th Cir. 2002), and Robinson v. Tyson Foods, Inc., 595 F.3d 1269 (11th Cir. 2010), controlled its decision. In Burnes, we observed that
[i]n the Eleventh Circuit, courts consider two factors in the application of judicial estoppel to a particular case. First, it must be shown that the allegedly inconsistent positions were made under oath in a prior proceeding. Second, such inconsistencies must be shown to have been calculated to make a mockery of the judicial system.
291 F.3d at 1285 (quotation marks and citation omitted) (quoting Salomon Smith Barney, Inc. v. Harvey, 260 F.3d 1302, 1308 (11th Cir. 2001), vacated on other grounds, 537 U.S. 1085, 123 S.Ct. 718, 154 L.Ed.2d 629 (2002)). In Robinson, we observed that "[w]hen considering a party's intent [under the second prong of our test] . . . the debtor's failure to satisfy its statutory disclosure duty is 'inadvertent' only when, in general, the debtor either lacks knowledge of the undisclosed claims or has no motive for their concealment." 595 F.3d at 1275 (quotation marks omitted) (quoting Barger, 348 F.3d at 1295–96).
U.S. Steel was entitled to summary judgment, the District Court held, because it established both Burnes factors as a matter of law. The court summarily dispatched Slater's argument that U.S. Steel failed to establish the two New Hampshire factors she had cited in her memorandum in opposition to U.S. Steel's alternative motions with the statement that Burnes "[i]ncorporat[ed] those considerations" in "outlin[ing] [the] two factors whose presence call for the imposition of judicial estoppel."
The District Court viewed Burnes and Robinson as controlling its decision because, like Slater's case, they
involved the plaintiff's inconsistent sworn testimony in two separate proceedings, a bankruptcy proceeding and a federal employment discrimination case. In both cases, the plaintiff failed to disclose the existence of the pending lawsuit seeking monetary compensation as an asset in the bankruptcy proceeding. The Eleventh Circuit found in both cases that the plaintiff had a duty to disclose the federal lawsuit as an asset; that the failure to reflect the lawsuit in the bankruptcy case was a breach of that duty resulting in inconsistent positions under oath; that the district court, in its discretion, could infer from the record the requisite intent to make a mockery of the judicial system; and thus, that the court's application of the doctrine of judicial estoppel to grant summary judgment was not clear error. 10
Just like the plaintiffs in Burnes and Robinson, Slater took inconsistent positions under oath when she breached the duty to disclose her ongoing employment discrimination claims in her bankruptcy...
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