Yanez v. U.S.
| Decision Date | 29 March 1993 |
| Docket Number | 91-15247,Nos. 91-15174,s. 91-15174 |
| Citation | 989 F.2d 323 |
| Parties | Isabel YANEZ, Plaintiff-Appellant, v. UNITED STATES of America, Defendant-Appellee. Isabel YANEZ, Plaintiff, v. UNITED STATES of America, Third Party Plaintiff-Appellant, v. BROCO, INCORPORATED; J.S. Brower & Associates; and J.S. Brower, individually, Third Party Defendant-Appellee. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Joseph J. Appel, San Francisco, CA, for plaintiff-appellant Isabel Yanez.
William F. Murphy, Asst. U.S. Atty., San Jose, CA, for defendant-third-party-plaintiff U.S.
James Duryea, Jr., Law Offices of James Duryea, Jr., San Francisco, CA, for third-party-defendant-appellee Broco, Inc.; J.S. Brower & Associates; and J.S. Brower, individually.
Appeal from the United States District Court for the Northern District of California.
Before SCHROEDER and BRUNETTI, Circuit Judges, and SAMUEL P. KING, * District Judge.
I. OVERVIEW
On June 11, 1986, an explosion occurred at Caelus Devices, Inc. ("CDI"), a munitions contractor for the United States. Appellant Isabel Yanez, a CDI employee, suffered third degree burns and lost her left lower arm. On February 6, 1987, Yanez filed suit in California Superior Court against Broco, Inc., J.S. Brower & Associates, and J.S. Brower (collectively "Broco") alleging that Broco supplied defective lead azide (the initiating explosive) to CDI, proximately causing her injuries. Broco was also sued by CDI. The cases were consolidated. The Yanez/Broco suit settled in April 1989 for $375,000. The CDI/Broco suit settled in May 1989 for $90,000. Pursuant to California Code of Civil Procedure § 877.6, 1 retired state court Judge J. Barton Phelps, judge pro tempore, issued orders determining good faith settlements and barring further claims.
Meanwhile, on June 7, 1988, Yanez initiated a federal suit against the United States pursuant to the Federal Tort Claims Act. Yanez alleged that the United States was negligent in inspecting and enforcing contractual safety regulations, proximately causing her injuries.
On June 20, 1989, the United States filed a third-party complaint against Broco seeking indemnity or contribution. Broco moved to dismiss under principles of good faith settlement, relying on the April 1989 settlement agreement between it and Yanez. The district court denied Broco's motion on Sept. 28, 1989. The district court, Judge Spencer Williams, found that the settlement was not made in good faith because the United States was not a party and the settlement payment was not proportionate to the parties' relative liability. In doing so, the court did not enunciate all the factors from Tech-Bilt Inc. v. Woodward-Clyde & Assoc., 38 Cal.3d 488, 213 Cal.Rptr. 256, 698 P.2d 159 (1985). Broco moved for reconsideration. The court did not rule on this motion.
The United States then moved pursuant to Fed.R.Civ.P. 12(c) for judgment on the pleadings against Yanez. The district court, treating the motion as one for summary judgment, denied it on Dec. 8, 1989. It found Yanez had presented sufficient evidence that a reasonable trier of fact could find the United States was negligent. It also found that the discretionary function exemption did not apply.
On May 16, 1990, the United States then moved the court under Fed.R.Civ.P. 7(b)(1) to invoke the doctrine of judicial estoppel and dismiss Yanez' lawsuit. The United States included in its memorandum in support of its motion 1) the state court complaint, 2) Yanez' responses to the United States' request for admissions, 2 and 3) affidavits from two of Yanez' experts asserting their conclusions that the United States was responsible for the explosion causing Yanez' injuries (the affidavits did not mention defective lead azide, but rather that "electrostatic discharge" led to the explosion), purportedly to show that Yanez was asserting an inconsistent legal theory. It also referenced status conference statements by Yanez to the effect that defective lead azide caused the accident. Yanez filed opposition papers on May 29, 1990.
The court treated the motion as one for partial summary judgment. It granted it in favor of the United States, invoking the doctrine of judicial estoppel. The court barred Yanez from pleading that the cause of her accident was the government's failure to supervise and enforce regulations at CDI. Pursuant to 28 U.S.C. § 1292(b), the case was certified for appeal. Yanez petitioned for leave to file an interlocutory appeal but the Ninth Circuit denied it on August 27, 1990.
On Sept. 26, 1990, the United States moved pursuant to Rules 7(b) and 12(b)(6) for a final entry of judgment, asserting that due to the previous order granting partial summary judgment "plaintiff has no other issue with the U.S. before the court." In addition to previously submitted material (state court complaint, etc.), the United States filed excerpts from Yanez' deposition testimony. Yanez asked the district court for a reconsideration of the court's ruling on judicial estoppel.
On Oct. 29, 1990, third-party defendant Broco again moved to dismiss the United States' third party complaint and for an entry of judgment. Broco asserted that 1) the good faith settlement between Yanez and Broco barred the third-party complaint and 2) by reason of the court's order filed on July 11, 1990 the third-party complaint for contribution no longer stated a claim upon which relief could be granted.
The court heard the Sept. 26 and Oct. 29 motions on November 28, 1990. Yanez argued, among other points, that because she had no notice that the court was considering partial summary judgment, it never gave her a chance to dispute facts considered by the court. She only presented argument in her May 29, 1990 opposition regarding the legal issue of judicial estoppel.
On December 14, 1990, in Yanez v. United States, 753 F.Supp. 309 (N.D.Cal.1990) ("Yanez I "), the court granted the United States' motion, treating it as one for summary judgment, entering final judgment against Yanez pursuant to Fed.R.Civ.P. 58. It denied Yanez' motion for reconsideration and granted Broco's motion to dismiss the third-party complaint. The opinion contained no explanation for why the third-party complaint was dismissed. On April 26, 1991, however, in granting a Motion for Review of Awards and Costs by the United States, the court clarified its December 14, 1990 order which dismissed Broco by stating
Two appeals are before us. Yanez appeals the grant of summary judgment, disputing the court's ruling on judicial estoppel. The government appeals the dismissal of Broco, contingent on Yanez prevailing, asking this court to reinstate the third-party claim. Broco in turn argues that, even if Yanez is successful, this court should affirm the granting of its motion to dismiss and find that the suit was settled in good faith.
II. DISCUSSION
This court reviews grants of summary judgment de novo. T.W. Elec. Serv., Inc v. Pacific Elec. Contractors Ass'n, 809 F.2d 626, 629 (9th Cir.1987). A court invokes judicial estoppel at its discretion. Russell v. Rolfs, 893 F.2d 1033, 1037 (9th Cir.1990), cert. denied, --- U.S. ----, 111 S.Ct. 2915, 115 L.Ed.2d 1078 (1991).
The precise law of judicial estoppel is unclear in the Ninth Circuit. Morris v. California, 966 F.2d 448 (9th Cir.1991), cert. denied, --- U.S. ----, 113 S.Ct. 96, 121 L.Ed.2d 57 (1992), is instructive:
As a general principle, the doctrine of judicial estoppel bars a party from taking inconsistent positions in the same litigation.... Although this circuit has adopted the doctrine of judicial estoppel, we have not yet determined the circumstances under which it will be applied.... The majority of circuits recognizing the doctrine hold that it is inapplicable unless the inconsistent statement was actually adopted by the court in the earlier litigation; only in that situation, according to those circuits, is there a risk of inconsistent results and a threat to the integrity of the judicial process.... The minority view, in contrast, holds that the doctrine applies even if the litigant was unsuccessful in asserting the inconsistent position, if by his change of position he is playing "fast and loose" with the court.... In either case, the purpose of the doctrine is to protect the integrity of the judicial process. Accordingly, the doctrine of judicial estoppel "is an equitable doctrine invoked by a court at its discretion."
Id. at 452-53 (citations omitted).
Although the Ninth Circuit has not yet specifically adopted either the "majority" or "minority" view, various circuit cases contain language upon which the parties base their arguments. Appellant Yanez relies on Arizona v. Shamrock Foods Co., 729 F.2d 1208 (9th Cir.1984), cert. denied, 469 U.S. 1197, 105 S.Ct. 980, 83 L.Ed.2d 982 (1985):
A plaintiff who has obtained relief from an adversary by asserting and offering proof to support one position may not be heard later in the same court to contradict himself in an effort to establish against the same adversary a second claim inconsistent with his earlier contention.
Id. at 1215 (quoting Scarano v. Central R. Co. of New Jersey, 203 F.2d 510, 513 (3d Cir.1953)) (appellant's emphasis). She asserts that the highlighted elements are lacking.
The government relies on Stevens Technical Services, Inc. v. S.S. Brooklyn, 885 F.2d 584, 589 (9th Cir.1989); Russell v. Rolfs, 893 F.2d 1033 (9th Cir.1990); and Rockwell Intern. Corp. v. Hanford Atomic Metal Trades Council, 851 F.2d 1208, 1210 (9th Cir.1988) () (citations...
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