Court Opinion

ID: 4680552
Source: CourtListenerOpinion
Date Created: 2021-04-23 16:00:34.913285+00
Date Added: 2024-06-11T08:03:55.982414
License: Public Domain

FILED
                                                                    United States Court of Appeals
                          UNITED STATES COURT OF APPEALS                    Tenth Circuit

                                FOR THE TENTH CIRCUIT                      April 23, 2021
                            _________________________________
                                                                       Christopher M. Wolpert
                                                                           Clerk of Court
 In re: GORDON NITKA,

        Debtor.

 ------------------------------

 GORDON BEECHER NITKA,

        Plaintiff - Appellant,

 v.                                                       No. 20-1270
                                                       (BAP No. CO 20-002)
 DEPARTMENT OF EDUCATION,

        Defendant - Appellee.
                       _________________________________

                                ORDER AND JUDGMENT*
                            _________________________________

Before MORITZ, BALDOCK, and EID, Circuit Judges.
                  _________________________________

       Gordon Nitka initiated an adversarial proceeding in bankruptcy court against

the Department of Education (“DOE”), seeking discharge of approximately $200,000

in law school student loans based on “undue hardship” under 11 U.S.C. § 523(a)(8).

       *
        After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist in the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore
ordered submitted without oral argument. This order and judgment is not binding
precedent, except under the doctrines of law of the case, res judicata, and collateral
estoppel. It may be cited, however, for its persuasive value consistent with
Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
The bankruptcy court granted summary judgment to DOE, and the Bankruptcy

Appellate Panel (“BAP”) affirmed. Nitka appeals pro se from the BAP’s decision.1

Exercising jurisdiction under 28 U.S.C. § 158(d)(1), we affirm.

                                  BACKGROUND

      Nitka graduated from Colorado College in 2005 with degrees in English and

Biology. During college, he worked as a host for the school’s administration, a

physiology and anatomy tutor, a surgical paraprofessional, and a bartender and server

at a resort. After graduating, he continued working at the resort before taking a

position as the co-director of a hospitality center at the 2006 Winter Olympics in

Italy. Upon returning to Colorado, he resumed his jobs at the resort and also began

working in nightclubs, first as security and later as a manager.

      In 2010, Nitka enrolled at Phoenix School of Law, later renamed the Arizona

Summit Law School. He financed his education with student loans, executing two

master promissory notes. While in school, he held several paid positions, including

in the legal field and as a fitness coach. After graduating, he worked as a contract

employee at a law firm, earning $25 per hour as a law clerk and rising to the rank of

      1
         “[W]e generally construe pro se pleadings liberally” but have not “extend[ed]
the same courtesy to . . . licensed attorney[s].” Comm. on the Conduct of Att’ys v.
Oliver, 510 F.3d 1219, 1223 (10th Cir. 2007) (internal quotation marks omitted).
The parties dispute whether, and to what extent, we should liberally construe Nitka’s
filings, considering he is a law school graduate but not a licensed attorney. Because
it does not affect the outcome of the case, we liberally construe Nitka’s filings. But
he still must “follow the same rules of procedure that govern other litigants,” and we
“cannot take on the responsibility of serving as [his] attorney in constructing
arguments and searching the record.” Garrett v. Selby Connor Maddux & Janer,
425 F.3d 836, 840 (10th Cir. 2005) (internal quotation marks omitted).
                                           2
firm director. He took the Arizona bar exam twice but did not pass. To supplement

his income, Nitka (1) continued fitness coaching until November 2015, earning up

to $90 per hour; (2) served as an advisor to a start-up fitness company, earning

equity compensation; and (3) worked twenty to thirty hours per week selling

commission-based insurance for MassMutual from August 2014 to January 2018.

      In May 2018, the law firm terminated Nitka’s employment. He has since been

unemployed, with the exception of earning approximately $3,000 over the course of a

couple months as a roofing salesman. He unsuccessfully applied for several jobs and

testified in May 2019 that he had ceased submitting applications, instead focusing his

time on (1) building a mobile phone application for the restaurant industry, and

(2) converting a bus into a vacation rental that he will park near ski resorts. He lives

rent-free with his mother and has about $32,000 in retirement accounts. When he has

income, he spends about $200 per month on food and $60 on a cell phone plan.

      As of November 2019, Nitka’s student loan debt was $209,716.48. He made

no payments on the loans in 2013 and obtained a deferral for most of 2014. In June

2015, he began participating in an income-driven repayment program that reduced his

monthly obligation. Still, he did not make any payments in 2015, despite earning

$61,901, with an adjusted gross income of $39,156 and taxable income of $28,856.

In 2016, he made six payments of $21.82, totaling $130.92, although his gross

income was $83,000, with taxed Social Security earnings of $54,643. He earned

$31,180 in 2017 and made five payments of $21.82, totaling $109.10. He made no

payments in 2018, when he earned $8,381, with an adjusted gross income of $8,010.

                                           3
Nitka has paid a total of only $240.02, but DOE has asserted he remains eligible for

an income-based program, under which his balance would be forgiven after 25 years.

      In July 2018, Nitka, then 36 years old, filed a petition under Chapter 7 of the

Bankruptcy Code and an adversary proceeding to have his loans discharged. After

several discovery disputes, DOE moved for summary judgment. Nitka opposed the

motion and moved for sanctions, claiming DOE made factual misrepresentations.

The bankruptcy court denied Nitka’s motion for sanctions and granted DOE’s motion

for summary judgment. The BAP affirmed, and Nitka appealed to this court.

                                    DISCUSSION

      “In our review of BAP decisions, we independently review the bankruptcy

court decision,” In re Albrecht, 233 F.3d 1258, 1260 (10th Cir. 2000), assessing legal

conclusions de novo and factual findings for clear error, see Borgman v. Dunckley

(In re Borgman), 698 F.3d 1255, 1259 & n.5 (10th Cir. 2012). Nitka raises several

challenges to the bankruptcy court’s judgment. None are persuasive.

      I.     Procedural Rulings Prior to DOE Moving for Summary Judgment

      First, Nitka contends the bankruptcy court erred in granting DOE’s motion

under Fed. R. Civ. P. 37 to prohibit him from using exhibits or witnesses, other than

himself, at trial due to his failure to fully and timely comply with the scheduling

order’s requirements for serving trial exhibits. As the BAP observed, the bankruptcy

court considered Nitka’s exhibits in ruling on DOE’s motion for summary judgment.

Because we conclude that the court properly granted summary judgment to DOE, the

issue of what evidence would be admitted at trial is moot.

                                           4
      Nitka also contends the bankruptcy court erred in forcing him to choose

between foregoing reliance on his medical conditions in support of his hardship claim

or submitting to reopened discovery. Specifically, as a result of Nitka’s shifting

positions throughout the proceedings regarding his medical conditions and their

relation to his hardship claim, DOE moved to prohibit him under Fed. R. Civ. P. 37

from offering evidence of medical conditions or, alternatively, to reopen discovery to

seek information related to such conditions. The bankruptcy court found that Nitka

had abused the discovery process and gave him the option of foregoing reliance on

medical conditions or submitting to further discovery. Based on Nitka’s commitment

not to “rais[e] any medical issues in support of [his] case,” R., vol. 2 at 823, the court

denied the motion to reopen discovery and granted the motion to prohibit evidence of

medical conditions. Although Nitka now contends the court abused its discretion, he

made his choice and cannot complain of any invited error.2 See John Zink Co. v.

Zink, 241 F.3d 1256, 1259 (10th Cir. 2001) (“The invited error doctrine prevents a

party from inducing action by a court and later seeking reversal on the ground that

the requested action was error.” (internal quotation marks omitted)).

      II.    Contents of DOE’s Motion for Summary Judgment

      Next, Nitka contends that DOE made false statements of fact and that the

bankruptcy court erred in not granting his motion for sanctions. Because he moved

      2
        Nitka states, without argument or authority, that he was subjected to a
“forced waiver.” Aplt. Opening Br. at 62. We will not consider such a perfunctory
contention. See United States v. Wooten, 377 F.3d 1134, 1145 (10th Cir. 2004).
                                            5
for sanctions under Fed. R. Civ. P. 11, the court applied “Fed. R. Bankr. R. 9011,

which is derived from Fed. R. Civ. P. 11.” Masunaga v. Stoltenberg (In re Rex

Montis Silver Co.), 87 F.3d 435, 438 (10th Cir. 1996). The bankruptcy court denied

the motion because Nitka failed to follow the “safe harbor” provision, which requires

that the non-movant be given notice and an opportunity to cure the allegedly

offending conduct. Fed. R. Bank. P. 9011(c)(1)(A); cf. Fed. R. Civ. P. 11(c)(2).

Nitka does not claim he complied with the “safe harbor” provision but, instead,

argues it does not apply because he filed his motion under Fed. R. Civ. P. 56(c)(2).

However, he based his motion only on Fed. R. Civ. P. 11(c)(2), with no mention of

Fed. R. Civ. P. 56(c)(2). See R., vol. 2 at 861. In any event, Fed. R. Civ. P. 56(c)(2),

which allows a party to object to a summary judgment motion, does not address

sanctions. Accordingly, we find no abuse of discretion by the bankruptcy court.3

      Nitka also contends the bankruptcy court abused its discretion by not striking

the declaration of DOE loan analyst Christopher Bolander. He argues that DOE

offered Bolander as an expert under Fed. R. Evid. 702 and that because DOE

previously disclosed an expert, Bolander’s declaration violated the scheduling order,

which limited each side to one expert. Nitka also argues the court should have

struck the declaration because DOE did not disclose Bolander as an expert under

Fed. R. Civ. P. 26(a)(2)(A). However, “Bolander based his declaration on his

      3
       We decline to consider Nitka’s conclusory assertion, unsupported by
argument or authority, that the court erred in not imposing sanctions sua sponte. See
Wooten, 377 F.3d at 1145.
                                           6
position at [DOE] and his review of [Nitka’s] loan information and payment history,”

and he “described facts as they pertain to [Nitka’s] student loan[s], including the

promissory loans, the outstanding balance, the payment history and switch to

alternative repayment plans, and details regarding [DOE’s] options for repayment.”

R., vol. 1 at 28. Our precedent suggests this testimony—if opinion testimony at

all4—was lay testimony under Fed. R. Evid. 701, not expert testimony under

Fed. R. Evid. 702, see Ryan Dev. Co., L.C. v. Ind. Lumbermens Mut. Ins. Co.,

711 F.3d 1165, 1170-71 (10th Cir. 2013) (noting “[a] lay witness accountant may

testify [under Fed. R. Evid. 701] on the basis of facts or data perceived in his role as

an accountant based on his personal knowledge of the company” (internal quotation

marks omitted)). Therefore, the bankruptcy court did not abuse its discretion in

refusing to strike the declaration.

       Finally, Nitka objected to DOE’s motion for summary judgment on the

grounds that it relied on portions of his deposition transcript and that he lacked the

funds to obtain his own complete copy. In particular, he moved the court to deny or

delay ruling on the summary judgment motion because he could not “present facts

essential to justify its opposition” without a copy of the transcript. Fed. R. Civ. P.

56(d)(1). He insists he needed a copy because “DOE used select, out-of-context

excerpts.” Aplt. Opening Br. at 64. The court denied his request as (1) procedurally

       4
        See United States v. Kearn, 863 F.3d 1299, 1307 n.3 (10th Cir. 2017) (stating
testimony providing “facts, not opinions,” is not subject to Fed. R. Evid. 701 or 702).

                                            7
defective, because it was not supported by an “affidavit or declaration,”

Fed. R. Civ. P. 56(d); and (2) without merit, because Nitka knew or should know

what was said at his own deposition. He contests the procedural ruling but not the

merits ruling, and thus, his challenge to the denial of his Fed. R. Civ. P. 56(d)(1)

motion fails. See Bones v. Honeywell Int’l, Inc., 366 F.3d 869, 877 (10th Cir. 2004)

(affirming summary judgment where appellant failed to appeal alternative basis for

ruling).

       Nitka also contends DOE was required to produce the entire transcript based

on Fed. R. Evid. 106, which provides “[i]f a party introduces all or part of a writing

or recorded statement, an adverse party may require the introduction, at that time, of

any other part—or any other writing or recorded statement—that in fairness ought to

be considered at the same time.” But this rule “does not necessarily require

admission of an entire statement, writing or recording” but “only those portions

which are relevant to an issue in the case and necessary to clarify or explain the

portion already received.” United States v. Lopez-Medina, 596 F.3d 716, 735

(10th Cir. 2010) (brackets and internal quotation marks omitted). Nitka has not

identified which additional portions of his deposition transcript needed to be

admitted, nor has he argued how he was prejudiced, and it is not our role to make the

arguments for him. Garrett v. Selby Connor Maddux & Janer, 425 F.3d 836, 840

(10th Cir. 2005).

       Last, Nitka contends the “transcript was not admissible as evidence because

DOE failed to follow Fed. R. Civ. P. 5(d)(1) which requires a deposition transcript to

                                            8
be filed with the court if it is used in the proceeding.” Aplt. Opening Br. at 66-67

(internal quotation marks omitted). He therefore argues the bankruptcy court erred in

overruling his objection “that the material cited to support or dispute a fact cannot be

presented in a form that would be admissible in evidence.” Fed. R. Civ. P. 56(c)(2).

But plainly, the material cited by DOE could be presented in a form that would be

admissible in evidence—Nitka’s own testimony. In any event Fed. R. Civ. P. 5(d)(1)

is a rule of procedure, not evidence, and provides that deposition transcripts

“must not be filed until they are used in the proceeding or the court orders filing,”

Fed. R. Civ. P. 5(d)(1)(A) (emphasis added). The rule does not require an entire

transcript be filed if a portion is used, and the local rules specify that only “relevant

excerpt[s]” should be attached to a summary judgment motion, D. Colo. L. Bankr. R.

7056-1(c). Nitka thus has not shown the court erred in its rulings regarding the

transcript.5

       III.    Order Granting Summary Judgment

       In his final argument, Nitka contends the bankruptcy court erred in granting

summary judgment to DOE. We review this issue de novo and must “affirm if there

is no genuine dispute as to any material fact and the movant is entitled to judgment as

a matter of law.” Lee v. McCardle (In re Peeples), 880 F.3d 1207, 1212 (10th Cir.

2018) (citation and internal quotation marks omitted). “A dispute is genuine” if the

       5
        Nitka also states, without argument or authority, that he was entitled to
copies of the transcript under Fed. R. Civ. P. 30(f) and 26(a) and that the transcript
should have been struck under Fed. R. Civ. P. 12(f). We decline to consider such
conclusory assertions. See Wooten, 377 F.3d at 1145.
                                             9
evidence could reasonably result in a ruling for non-movant, and a fact is material if

“it might affect the outcome.” Bird v. W. Valley City, 832 F.3d 1188, 1199 (10th Cir.

2016) (internal quotation marks omitted). The non-movant, however, may not rely

on “[u]nsubstantiated allegations.” Bones, 366 F.3d at 875.6

       To establish undue hardship for discharging student loans under 11 U.S.C.

§ 523(a)(8), a debtor must satisfy three factors:

       (1) that the debtor cannot maintain, based on current income and
       expenses, a minimal standard of living for herself and her dependents if
       forced to repay the loans;

       (2) that additional circumstances exist indicating that this state of affairs
       is likely to persist for a significant portion of the repayment period of
       the student loans; and

       (3) that the debtor has made good faith efforts to repay the loans.

Educ. Credit Mgmt. Corp. v. Polleys, 356 F.3d 1302, 1307, 1309 (10th Cir. 2004)

(internal quotation marks omitted). The test must be applied to allow discharge for

“debtors who truly cannot afford to repay their loans.” Id. at 1309.

       The bankruptcy court concluded Nitka made a sufficient showing on the first

and third factors to withstand summary judgment but not on the second factor. When

considering this factor, a court must take “a realistic look . . . into [the] debtor’s

circumstances and . . . ability to provide for adequate shelter, nutrition, health care,

and the like.” Id. at 1310. A “court[] should base [its] estimation of a debtor’s

prospects on specific articulable facts, not unfounded optimism, and the inquiry into

       6
      Nitka devotes much of his briefs to disputing statements in DOE’s summary
judgment motion. Our focus, however, remains on the court’s order and the record.
                                            10
future circumstances should be limited to the foreseeable future, at most over the

term of the loan.” Id. (internal quotation marks omitted). A debtor need not show

“a certainty of hopelessness,” but the second factor “recognizes that a student loan is

viewed as a mortgage on the debtor’s future.” Id. (internal quotation marks omitted).

      It is undisputed that Nitka is relatively young, has no dependents, and is highly

educated. He twice failed the Arizona bar exam, but “[m]any attorneys fail the

bar examination a time or two and go on to very successful careers in the law.”

R., vol. 4 at 2623. He alleges he cannot afford to take the Colorado bar exam, which

he believes he can pass, but there is no evidence that he has inquired into a fee

waiver. Nitka also has significant “experience in numerous industries,” id., and has

proven capable of holding steady employment when he chooses. But he has taken no

steps to re-enter the insurance industry, and he “just [does not] want to work in a

restaurant,” R., vol. 1 at 171. He averaged only one job application per month

between May 2018 and May 2019, at which point he “gave up on job searching.”

Id. at 180. He instead spends 100 hours per week on “new business ventures,” which

“is his choice.” R., vol. 4 at 2623. One project is building a mobile phone

application, which, coupled with his knowledge of HTML, see R., vol. 1 at 147,

indicates technological proficiency he could use in obtaining employment. The other

project is converting a bus into a vacation rental, which he planned to complete by

the end of 2020 and rent for $100 to $400 per night. Although he uses his “own two

hands” to convert the bus, id. at 184, and plans to convert one bus per year, he

                                           11
suggests his medical conditions hinder his job prospects. But as upheld above, he

waived any reliance on his medical conditions to show undue hardship.

       Ultimately, Nitka “has a strong potential for future employment should he

choose to go back to work” and has not shown “his financial situation [is] unlikely to

improve.” R., vol. 4 at 2624. He also has not shown “his financial difficulties are

likely to persist for a significant portion of the repayment period,” which “is at least

21 years.” Id.7 He alleged he does “not plan on remaining in [his] current desperate

situation” and “fully anticipate[s] pulling [him]self out of these circumstances.”

Id. (internal quotation marks omitted). And he testified he needs the discharge

because of his “current economic situation, now and in the near future.” R., vol. 1

at 155 (emphasis added). That hardly bespeaks a “state of affairs . . . likely to persist

for a significant portion of the repayment period of the student loans.” Polleys,

356 F.3d at 1307. Accordingly, the court properly granted summary judgment for

DOE.

       7
        Nitka insists his “repayment period was over” as of September 2018, when,
according to the rules on DOE’s website, he defaulted on his loans. Aplt. Opening
Br. at 34. But see Aplt. Opening Br. at 33 (stating he was “in default as of February
26, 2019 (270 days from the June 1, 2018 payment date)”). He thus contends that
because the repayment period ended and he is unable to pay the balance in full, he
has shown his “state of affairs is likely to persist for a significant portion of the
repayment period,” Polleys, 356 F.3d at 1307. But while Nitka made this argument
in the BAP, he did not raise it in bankruptcy court, and he has not argued plain error.
We therefore decline to consider this argument. Richison v. Ernest Grp., Inc.,
634 F.3d 1123, 1131 (10th Cir. 2011).

                                           12
                           CONCLUSION

The bankruptcy court’s judgment is affirmed.

                                   Entered for the Court

                                   Bobby R. Baldock
                                   Circuit Judge

                                 13