White v. Wyndham Vacation Ownership Inc.

Summarized by Michael Coury , Glankler Brown, PLLC
15 years 5 months ago

Citation:

--F.3d---, 2010 WL 3155161, 109 Fair Empl. Prac. Case (BNA) 1731, 6th Circuit (Tenn.), August 11 , 2010, (No. 09-5626)

Tag(s):

6th Circuit

Ruling:

In split decision, the Sixth Circuit affirmed District Court's dismissal of debtor's sexual harrassment claims against former employer on judicial estoppel grounds based on debtor's failure to adequately disclose existence of claim in bankruptcy schedules. Court found that Debtor's limited and ineffective attempts to correct initial omission were insufficient to establish that omission was inadvertent. The Debtor had actual knowledge of her claim and failed to disclose it prior to plan confirmation. Debtor had motive to conceal the claim so creditors would not share in recovery. Dissent would have allowed recovery of damages to extent of benefit to debtor's creditors.

Procedural context:

Appeal from summary judgment granting dismissal of sexual harrassment complaint.

Facts:

Debtor obtained right to sue letter from EEOC 1 month prior to filing a Ch. 13 petition. Petition made no mention of harrassment claim in Schedule B or in Statement of Financial Affairs. The day after her plan was confirmed, the debtor filed her harrassment claim in federal court seeking compensatory damages and $1 million in punitive damages. The next day the Debtor filed an application to employ counsel with the bankruptcy court, but did not indicate her role in lawsuit, when claim would be filed, facts forming basis of claim or amount of claim.One month later, defendants filed their motion to dismiss on judicial estoppel grounds. Debtor then amended SFA to list harrassment claim under pending suits but still did not disclose amount of suit. In response to motion to dismiss, debtor submitted affidavit of Ch. 13 attorney who asserted debtor did not conceal claim and that claim had been omitted from schedules by oversight.

Judge(s):

McTeague ( Polster, concurring),(Clay, dissenting)

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