Court Opinion

ID: 4289976
Source: CourtListenerOpinion
Date Created: 2018-06-29 16:00:45.651198+00
Date Added: 2024-06-11T14:38:01.277777
License: Public Domain

Case: 17-14022   Date Filed: 06/29/2018   Page: 1 of 7

                                                                  [PUBLISH]

          IN THE UNITED STATES COURT OF APPEALS

                  FOR THE ELEVENTH CIRCUIT
                    ________________________

                          No. 17-14022
                      Non-Argument Calendar
                    ________________________

                D.C. Docket No. 3:16-cv-00205-HNJ

TIMOTHY WEAKLEY,

                                                         Plaintiff-Appellant,

                                versus

EAGLE LOGISTICS,
CELADON TRUCKING,

                                                      Defendants-Appellees.

                    ________________________

                          No. 17-14023
                      Non-Argument Calendar
                    ________________________

                D.C. Docket No. 3:16-cv-00403-HNJ

TIMOTHY WEAKLEY,

                                                         Plaintiff-Appellant,
              Case: 17-14022     Date Filed: 06/29/2018    Page: 2 of 7

                                        versus

JENNIFER ROBERTS,
QUALITY COMPANIES,

                                                              Defendants-Appellees.

                           ________________________

                   Appeals from the United States District Court
                      for the Northern District of Alabama
                          ________________________

                                   (June 29, 2018)

Before ED CARNES, Chief Judge, MARCUS, and ROSENBAUM, Circuit
Judges.

PER CURIAM:

      In this consolidated appeal, Timothy Weakley appeals the district court’s

grant of summary judgment against him in favor of Eagle Logistics Services and

Celadon Trucking Services, and its grant of summary judgment against him (in a

separate lawsuit) in favor of Jennifer Roberts and Quality Companies. Weakley

contends that the district court abused its discretion by dismissing his two lawsuits

based on the doctrine of judicial estoppel as a result of Weakley’s failure to

disclose them in his bankruptcy proceeding.

      We review only for abuse of discretion the district court’s application of

judicial estoppel. Slater v. U.S. Steel Corp., 871 F.3d 1174, 1180 n.4 (11th Cir.

2017) (en banc). A debtor who has filed for bankruptcy “must file sworn

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disclosures listing his debts and his assets, including any pending civil claims, and

identifying any lawsuits he has filed against others.” Id. at 1176. When a debtor

fails to list a pending civil claim as an asset in a bankruptcy proceeding, the

equitable doctrine of judicial estoppel allows a court to exercise its discretion to

dismiss the debtor’s civil claim. See id. at 1180.

      We use a two-part test to guide district courts in applying judicial estoppel:

(1) Whether the plaintiff “took a position under oath in the bankruptcy proceeding

that was inconsistent with the plaintiff’s pursuit of the civil lawsuit[s],” and

(2) whether the inconsistent positions “were calculated to make a mockery of the

judicial system.” Id. at 1180–81 (quotation marks omitted). There is no question

that Weakley took an inconsistent position under oath in a separate proceeding. In

his Chapter 13 bankruptcy proceeding he failed to disclose the two lawsuits and the

claims in them as assets after asserting those claims and an entitlement to damages

in the lawsuits. See Robinson v. Tyson Foods, Inc., 595 F.3d 1269, 1275 (11th

Cir. 2010) (“[F]ailure to timely amend a Chapter 13 reorganization plan to reflect a

pending claim while simultaneously pursing that claim in another court of law

constitutes inconsistent positions under oath.”). As a result, we turn to the second

prong.

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      As for the second prong, district courts must “look to all the facts and

circumstances of the case to decide whether a plaintiff intended to mislead the

court . . . .” Slater, 871 F.3d at 1186. For example, a court may consider:

      the plaintiff’s level of sophistication, whether and under what
      circumstances the plaintiff corrected the disclosures, whether the
      plaintiff told his bankruptcy attorney about the civil claims before
      filing the bankruptcy disclosures, whether the trustee or creditors were
      aware of the civil lawsuit or claims before the plaintiff amended the
      disclosures, whether the plaintiff identified other lawsuits to which he
      was [a] party, and any findings or actions by the bankruptcy court
      after the omission was discovered.

Id. at 1185. The court may also consider the plaintiff’s explanation for the

omission, id. at 1177, although it need not credit that explanation, id. at 1186 n.12;

see also id. at 1190–91 (Carnes, C.J., concurring) (“[I]n deciding whether a

plaintiff intended to mislead when she omitted a claim from her bankruptcy

schedules, or failed to update a schedule to include the claim, the district court is

not required to accept the plaintiff’s denial of her intent. And that is true even if

her denial is made under oath and not contradicted by other evidence.”).

      In concluding that Weakley intentionally misled the bankruptcy court, the

district court considered that he not only failed to include the two lawsuits in his

initial bankruptcy filings but he also failed to include them in any of the six

separate amendments that he made to his schedules and filings during the

bankruptcy proceeding. The court pointed out that it was not until the defendants

in both lawsuits had relied on his failure to disclose as grounds for dismissal of the
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lawsuits that Weakley finally amended his bankruptcy filings to disclose those two

lawsuits and the claims they asserted. The court also considered his ability to

benefit financially at his creditors’ expense by concealing the two lawsuits. Not

only that but Weakley had disclosed as assets in the bankruptcy proceeding two

other lawsuits he had filed, both of which were of much lesser potential value than

the two nondisclosed ones, which together sought damages in excess of

$14,000,000. The district court reasoned that his failure to disclose the two higher

claim lawsuits while disclosing the other two lesser claim ones “indicates a motive

to exclude the potentially more lucrative, non-exempt [lawsuit assets] from the

bankruptcy proceedings.” Finally, the court took into account the fact that

Weakley had filed four other bankruptcy petitions, “demonstrating that [he] should

have been familiar with the requirements.”

      Although the district court reached its ruling before this Court issued its en

banc decision in Slater, its analysis is consistent with that decision. Slater

overruled our precedent that allowed courts to automatically infer a plaintiff’s

intent to mislead based solely on the plaintiff’s failure to disclose a civil claim in a

bankruptcy proceeding. See 871 F.3d at 1185. The district court did not infer

Weakley’s intent to defraud his creditors based only on his failure to disclose but

instead made its determination based on the facts and circumstances relating to the

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bankruptcy filings and nondisclosure. Our Slater decision requires a district court

to consider the entire record, see id., which is what the district court did.

       Weakley also argues that the judicial estoppel issue is moot because he

voluntarily dismissed his Chapter 13 bankruptcy petition.1 It isn’t moot. The

judicial estoppel issue presented to us in this appeal is not about what should

happen in the bankruptcy proceeding, a case that has not been appealed to us.

Instead, the issue is whether the district court abused its discretion in dismissing on

judicial estoppel grounds the two lawsuits that Weakley filed against the appellees

in the appeal before us. Weakley did not dismiss either one of these two lawsuits;

instead, he has appealed the district court’s dismissal of them. The propriety of

that dismissal is not moot.

       To the extent Weakley argues that his voluntary dismissal of his bankruptcy

petition makes the district court’s application of the judicial estoppel doctrine an

abuse of discretion in this case, we reject that contention. Judicial estoppel serves

to “prevent the perversion of the judicial process and protect its integrity.” Id. at

1180 (quotation marks and alterations omitted). It cannot serve that purpose as

well if a duplicitous debtor is assured that he can always avoid the doctrine’s bite

by dismissing his bankruptcy petition after his duplicity is found out. And that is

       1
          In his briefs Weakley also makes several factual allegations that he did not make in the
district court. We can’t and won’t consider those allegations. See Daniel v. Taylor, 808 F.2d
1401, 1404 n.2 (11th Cir. 1986) (“[T]his Court cannot consider evidence which was not before
the district court.”).
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what Weakley sought to do. He didn’t voluntarily dismiss his bankruptcy petition

until after the defendants moved for summary judgment on the grounds that he

intentionally omitted these two lawsuits from his bankruptcy filings. To guarantee

Weakley and others in his situation that, if caught, they could always undo the

application of the judicial estoppel doctrine would render it toothless.

      Because the district court considered all the facts and circumstances of

Weakley’s cases in determining whether he intended to mislead the bankruptcy

court, see id. at 1185, it did not abuse its discretion by applying judicial estoppel

and dismissing these two lawsuits that he failed to disclose in his bankruptcy

proceeding.

      AFFIRMED.

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