United States District Court, S.D. Mississippi, Northern Division
P. Jordan III CHIEF UNITED STATES DISTRICT JUDGE.
Lisa Davis and the Hazlehurst City School District seek
summary judgment on Plaintiff Kennyada Mitchell's claims
against them on the basis of judicial estoppel. Mot. Summ. J.
. For the reasons that follow, Defendants' motion is
granted, but the Trustee will be given an opportunity to
pursue Mitchell's claims on behalf of the bankruptcy
Facts and Procedural History
filed this lawsuit in July 2017, alleging that Defendants
caused her to lose her job with the Mississippi Department of
Education in May 2017. See Am. Compl. . On
August 1, 2018, Mitchell filed a Voluntary Petition for
Chapter 13 Bankruptcy in the United States Bankruptcy Court
for the Southern District of Mississippi. Yet when she
completed her bankruptcy schedules, Mitchell failed to
disclose this still-pending lawsuit. Instead, she checked the
“no” box in response to questions whether she
“own[s] or has any legal or equitable interest
in”: any “[c]laims against third parties, whether
or not you have filed a lawsuit or made a demand for
payment” or any “[o]ther contingent and
unliquidated claims of every nature.” Bankruptcy
Schedules [31-3] at 5, 7; see also Id. at 37
(responding “no” to the question, “[w]ithin
1 year before you filed for bankruptcy, were you a party in
any lawsuit, court action, or administrative
more troubling deception occurred on September 4, 2018, when
Mitchell attended a creditors' meeting and was examined
under oath. See 11 U.S.C. § 343. At that
meeting, Mitchell testified that she believed the information
in her schedules was accurate, that she had identified all
her assets in her schedules, and that she had no
“pending litigation or lawsuits or claims against
anyone.” Tr. [31-7] at 3. On October 16, 2018, the
bankruptcy court confirmed Mitchell's chapter 13 plan.
Under the confirmed plan, which calls for 60 monthly payments
of $371.00, “[a]ll property shall remain property of
the estate and shall vest in the debtor only upon entry of
discharge.” Chapter 13 Plan [31-8] at 1.
filed their motion for summary judgment on November 7, 2018,
asserting that Mitchell is judicially estopped from pursuing
her claims given her failure to disclose them as an asset in
her bankruptcy schedules. In response, Mitchell filed amended
schedules in her bankruptcy case on November 20, 2018.
Defendants' motion has been fully briefed, and the Court
has personal and subject-matter jurisdiction.
judgment is warranted under Federal Rule of Civil Procedure
56(a) when evidence reveals no genuine dispute regarding any
material fact and that the moving party is entitled to
judgment as a matter of law. The rule “mandates the
entry of summary judgment, after adequate time for discovery
and upon motion, against a party who fails to make a showing
sufficient to establish the existence of an element essential
to that party's case, and on which that party will bear
the burden of proof at trial.” Celotex Corp. v.
Catrett, 477 U.S. 317, 322 (1986).
party moving for summary judgment “bears the initial
responsibility of informing the district court of the basis
for its motion, and identifying those portions of [the
record] which it believes demonstrate the absence of a
genuine issue of material fact.” Id. at 323.
The nonmoving party must then “go beyond the
pleadings” and “designate ‘specific facts
showing that there is a genuine issue for trial.'”
Id. at 324 (citation omitted). In reviewing the
evidence, factual controversies are to be resolved in favor
of the nonmovant, “but only when . . . both parties
have submitted evidence of contradictory facts.”
Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th
Cir. 1994) (en banc). When such contradictory facts exist,
the court may “not make credibility determinations or
weigh the evidence.” Reeves v. Sanderson Plumbing
Prods., Inc., 530 U.S. 133, 150 (2000). Conclusory
allegations, speculation, unsubstantiated assertions, and
legalistic arguments have never constituted an adequate
substitute for specific facts showing a genuine issue for
trial. TIG Ins. Co. v. Sedgwick James of Wash., 276
F.3d 754, 759 (5th Cir. 2002); Little, 37 F.3d at
1075; SEC v. Recile, 10 F.3d 1093, 1097 (5th Cir.
estoppel ‘is an equitable doctrine invoked by a court
at its discretion' for the purpose of ‘protect[ing]
the integrity of the judicial process.'” United
States ex rel. Long v. GSDMIdea City, L.L.C., 798 F.3d
265, 271 (5th Cir. 2015) (quoting New Hampshire v.
Maine, 532 U.S. 742, 749-50 (2001)). In assessing
whether to apply judicial estoppel, the Court “look[s]
to whether: ‘(1) the party against whom judicial
estoppel is sought has asserted a legal position which is
plainly inconsistent with a prior position; (2) a court
accepted the prior position; and (3) the party did not act
inadvertently.'” Id. at 271-72 (quoting
Reed v. City of Arlington, 650 F.3d 571, 574 (5th
Cir. 2011) (en banc)). In the context of a legal position
taken in a bankruptcy case, “judicial estoppel must be
applied in such a way as to deter dishonest debtors, whose
failure to fully and honestly disclose all their assets
undermines the integrity of the bankruptcy system.”
Reed, 650 F.3d at 574.
response to Defendants' motion, Mitchell concedes the
first two elements of the judicial-estoppel test, arguing
only that her failure to disclose this lawsuit in her
bankruptcy schedules was inadvertent. In this context,
“inadvertence exists ‘only when, in general, the
debtor either lacks knowledge of the undisclosed claims
or has no motive for their concealment.'”
Long, 798 F.3d at 272 (quoting In re Coastal
Plains, Inc., 179 F.3d 197, 210 (5th Cir. 1999)).
was obviously aware of this civil action during her
bankruptcy proceedings. And as to the second available
argument, the Fifth Circuit has “held that a motive to
conceal is ‘self-evident' when a debtor fails to
disclose an asset to the bankruptcy court due to the
‘potential financial benefit resulting from
nondisclosure.'” Fornesa v. Fifth Third Mortg.
Co., 897 F.3d 624, 628 (5th Cir. 2018) (quoting
Allen v. C & H Distribs., L.L.C., 813 F.3d 566,
574 (5th Cir. 2015)).
never directly addresses these points, arguing instead that
she relied on the advice of counsel and remedied the defect
through an amended schedule disclosing this lawsuit. Starting
with the ...