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The Security National Bank of Sioux City, IA v. Vera T. Welte Testamentary Trust

Summarizing by Amir Shachmurove

Weakley v. Eagle Logistics

Case Type:
Case Status:
17-1402(2)3, DC Docket No 3:16-cv-00403-HNJ (11th Circuit, Jun 29,2018) Published
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. See Slater v. U.S. Steel Corp., 871 F.3d 1174, 1180 n.4 (11th Cir. 2017) (en banc); Robinson v. Tyson Foods, Inc., 595 F.3d 1269, 1275 (11th Cir. 2010);
Procedural context:
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.
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 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.”
Carnes, CJ Marcus, Rosenbaum

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