Court Opinion

ID: 31586
Source: CourtListenerOpinion
Date Created: 2010-04-25 10:19:10+00
Date Added: 2024-06-11T12:33:38.713281
License: Public Domain

United States Court of Appeals
                                                                     Fifth Circuit
                                                                   F I L E D
                            In the                                  June 2, 2003
       United States Court of Appeals                         Charles R. Fulbruge III
                  for the Fifth Circuit                               Clerk
                       _______________

                         m 02-11217
                       Summary Calendar
                       _______________

                     JOELINE WIEBURG,

                                           Plaintiff-Appellant,

                     HARVEY MORTON,
TRUSTEE FOR RICHARD CARL WIEBURG AND JOELINE JOYCE WIEBURG,

                                           Movant-Appellant

                           VERSUS

            GTE SOUTHWEST INCORPORATED,
           doing business as GTE Texas/New Mexico;
                              AND
               GTE SERVICE CORPORATION,

                                           Defendants-Appellees.

                 _________________________

          Appeals from the United States District Court
               for the Northern District of Texas
                      m 3:98-CV-2057-R
                _________________________
Before HIGGINBOTHAM, SMITH, and                              tified the trustee and moved t o dismiss Wie-
  CLEMENT, Circuit Judges.                                   burg’s complaint, arguing that the claim be-
                                                             longed to the bankruptcy estate and therefore
PER CURIAM:*                                                 that the trustee was the real party in interest.

    Joeline Wieburg appeals the dismissal, for                  The district court stayed the motion pend-
failure to name the real party in interest, of her           ing determination by the bankruptcy court of
employment discrimination suit against GTE                   who owned the claims. Wieburg and the trus-
Southwest (“GTE”). See FED. R. CIV. P.                       tee entered a settlement agreement in January
17(a). We review a dismissal under rule 17(a)                2000 stating that the claim belonged to the es-
for abuse of discretion. Wieburg v. GTE                      tate but that the trustee would retain Wie-
Southwest, Inc., 272 F.3d 302, 308 (5th Cir.                 burg’s counsel, who would prosecute this ac-
2001). Finding no abuse of discretion, we                    tion in Wieburg’s name.
affirm.1
                                                                 In April 2000, GTE supplemented its mo-
                      I.                                     tion to dismiss, arguing that Wieburg should
   This case is before us for the second time.               join or substitute the trustee, otherwise her suit
In the first appeal, we extensively stated the               should be dismissed. In May 2000, the district
facts, id. at 303-05, which we now review                    court consulted with Wieburg’s counsel, who
briefly.                                                     agreed to submit proof that the trustee had
                                                             agreed to be bound by any judgment. Yet,
   GTE fired Wieburg in 1996, and she filed                  Wieburg days later filed her response to
for bankruptcy a few months later. She re-                   GTE’s motion to dismiss, arguing that she
ceived a discharge from the bankruptcy court                 properly could prosecute the suit without sub-
in early 1997. Three weeks later, she filed a                stitution, joinder, or ratification of the trustee.
charge of discrimination against GTE with the                The court shortly thereafter granted GTE’s
Equal Employment Opportunity Commission.                     motion to dismiss a few days later.
She sued GTE in August 1998.
                                                                We affirmed in most respects. We agreed
   During her deposition in September 1999,                  that the trustee was the real party in interest.
GTE learned of Wieburg’s bankruptcy and                      Id. at 305-06. Furthermore, we held that the
that she had not disclosed her employment                    settlement agreement did “not authorize Wie-
discrimination claims to the trustee. GTE no-                burg to pursue the discrimination claims solely
                                                             in her own name.” Id. at 307. We held, how-
                                                             ever, that “it was an abuse of discretion for the
   *
                                                             district court to dismiss the action without
     Pursuant to 5TH CIR. R. 47.5, the court has             explaining why the less drastic alternatives of
determined that this opinion should not be pub-
                                                             either allowing an opportunity for ratification
lished and is not precedent except under the limited
                                                             by the [t]rustee, or joinder of the [t]rustee,
circumstances set forth in 5TH CIR. R. 47.5.4.
                                                             were [sic] inappropriate.” Id at 309. We
   1
     Once again, “[t]he [t]rustee was not a party in         therefore vacated the judgment and remanded
district court and has not sought to intervene in this       so the court could explain its reasons for the
appeal. Accordingly, the [t]rustee’s appeal must             dismissal. Id.
be dismissed.” Wieburg, 272 F.3d at 305.

                                                         2
   In so doing, we noted that                           at 308.2

   the district court did not address wheth-               We vacated and remanded the court’s first
   er Wieburg had a reasonable time after               dismissal not because we necessarily
   GTE’s objection during which to obtain               disagreed, but because the court made no
   joinder, ratification, or substitution of            factual findings for us to review for a possible
   the [t]rustee, or whether her decision to            abuse of discretion. Now that we have the
   pursue the action in her own name was                court ’s reasons, we conclude that it did not
   the result of an understandable mistake.             abuse its discretion by dismissing the suit.
   More importantly, it is unclear whether
   the district court considered the impact                                A.
   of the dismissal of Wieburg’s creditors,                We assume arguendo that Wieburg sued in
   who are owed approximately $40,000.                  her own name based on an understandable
                                                        mistake and address whether she had a
Id. at 308-09. On remand, the district court            reasonable time to correct the pleading
addressed all three of these questions at length,       deficiency. The court found that she had
finding that Wieburg’s prosecution of this suit         seven months to satisfy rule 17(a), a
in her own name did not result from an honest           reasonable time of which she did not take
mistake; that she had a reasonable time after           advantage. We agree.
GTE’s objection to obtain joinder, ratification,
or substitution of the trustee; and that dis-               GTE objected to Wieburg’s complaint in
missal would not seriously harm her creditors.          October 1999, and the court dismissed the suit
The court therefore dismissed the suit again.           in May 2000. Throughout this seven-month
                                                        period, Wieburg repeatedly failed to obtain
                         II.                            ratification, joinder, or substitution of the trus-
   “Every action shall be prosecuted in the             tee. At any point, she easily could have
name of the real party in interest. . . . No            corrected the pleading deficiency; instead, she
action shall be dismissed on th[is] ground . . .        went to great lengths to remain the sole
until a reasonable time has been allowed after          plaintiff. She sued the trustee in bankruptcy
objection for ratification of commencement of           court, asserting that the claims belonged to
the action by, or joinder or substitution of, the       her. She sought and received a stay of the
real party in interest[.]” FED. R. CIV. P. 17(a).       motion to dismiss from the district court. She
This last sentence is “applicable only when the         entered an artful settlement agreement with the
plaintiff brought the action in her own name as         trustee that only appeared to bind him to any
the result of an understandable mistake,” as            judgment. When prodded by the court, her
opposed to calculation or neglect. Wieburg,             counsel agreed to submit a formal ratification
272 F.3d at 308. To avoid dismissal, there-
fore, a plaintiff who is not the real party in
interest must show, first, that he sued in his             2
                                                             6A CHARLES A. WRIGHT ET AL., FEDERAL
own name based on an understandable mistake             PRACTICE AND PROCEDURE § 1555, at 415-16 (2d
and, second, that he did not have a reasonable          ed. 1990) (explaining that only plaintiffs whose
time to correct the pleading deficiency. See id.        pleading error resulted from understandable mis-
                                                        take should receive a reasonable time to correct the
                                                        error).

                                                    3
from the trustee, but instead submitted a brief       abuse of discretion.
arguing that Wieburg did not need to obtain
substitution, joinder, or ratification.                  AFFIRMED.

    “What constitutes a reasonable time is a
matter of judicial discretion and will depend
upon the facts of each case.” 6A CHARLES A.
WRIGHT ET AL., FEDERAL PRACTICE AND PRO-
CEDURE § 1555, at 417 (2d ed. 1990). Seven
months is more than reasonable, especially af-
ter Wieburg fully demonstrated her intent not
to surrender control of this suit. There is no
abuse of discretion.

                         B.
   We also requested that the court “consid-
er[ ] the impact of the dismissal on Wieburg’s
creditors.” Wieburg, 272 F.3d at 309. The
court found that a dismissal would have only a
negligible effect on her creditors, because any
recovery was highly speculative at this early
stage, and the dismissal would not alter their
position, i.e., t heir unpaid debt would remain
unpaid.

   We agree that the dismissal has at most a
negligible effect on Wieburg’s creditors. As
the court found, recovery was highly
speculative. The court had not even ruled on
GTE’s summary judgment motion yet, the
crucible for most employment discrimination
suits. Any recovery would be spread among
eight creditors, large corporations whose
financial condition hardly rises or falls with
their small share of Wieburg’s debts. Finally,
these creditors could have protected their
interests more effectively in bankruptcy court
after that court re-opened Wieburg’s case in
late 1999. In particular, they could have
encouraged the trustee, their legal
representative, not to enter the flawed
settlement agreement; failing that, they could
have challenged the agreement. There is no

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