Brent Nicholson v. Thrifty Payless Inc, 700 F. App'x 615

Thrifty Payless and Rite Aid terminated leases and guarantees with 11 LLCs managed by Brent Nicholson; the LLCs sued but the district court dismissed/limited claims and awarded attorneys’ fees and damages for extra rent.
Nicholson personally filed bankruptcy and listed only six of the LLCs (valued at $0) on his bankruptcy schedules; he did not value or disclose potential claims the LLCs could assert against Thrifty/Rite Aid despite termination notices for some projects before scheduling.
The district court held the LLCs judicially estopped from pursuing claims based on Nicholson’s bankruptcy disclosures, found some contract claims failed as a matter of law, awarded Thrifty extra rent from No One to Blaine, and awarded attorneys’ fees against the LLCs and Nicholson.
On appeal, the Ninth Circuit reviewed: (1) the judicial estoppel ruling; (2) whether Nicholson can be personally liable for contractual fee provisions though he signed as managing member; (3) joint-and-several allocation of fees among LLCs; and (4) prejudgment interest on the extra rent award.
The Ninth Circuit affirmed judicial estoppel, affirmed joint-and-several fee liability for the LLCs, vacated and remanded Nicholson’s personal fee liability for further explanation, affirmed Nicholson’s liability for extra rent (issue waived on appeal), and remanded the prejudgment interest issue.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Judicial estoppel of LLC claims	Nicholson/LLCs: bankruptcy disclosures were adequate; LLC claims preserved	Thrifty: Nicholson omitted LLCs/claims and valued them $0, so estoppel applies	Affirmed — estoppel proper due to omission/incomplete scheduling
Nicholson personally liable for contractual attorneys’ fees	Thrifty: Nicholson sued on contract theories and thus exposed himself to fees despite signing as LLC manager	Nicholson: signed only as managing member; not party to contracts so fees improper	Vacated/remanded — district court must state legal basis for fee liability to Nicholson
Joint-and-several fee liability among LLCs	LLCs: fees should be allocated among entities	Thrifty: single suit, same counsel, impossible to segregate fees	Affirmed — joint and several liability appropriate
Prejudgment interest on extra rent to No One to Blaine	Thrifty: liquidated counterclaim entitles it to prejudgment interest under WA law	LLCs: did not contest at summary judgment	Remanded — district court failed to rule; must determine entitlement under Washington law

Ah Quin v. Cty. of Kauai Dep’t of Transp., 733 F.3d 267 (9th Cir. 2013) (omission of pending claims from bankruptcy schedules supports judicial estoppel)
MRO Commc’ns, Inc. v. Am. Tel. & Tel. Co., 197 F.3d 1276 (9th Cir. 1999) (federal courts apply state law to determine right to fees for state-law claims)
Real Prop. Servs. Corp. v. City of Pasadena, 30 Cal. Rptr. 2d 536 (Cal. Ct. App. 1994) (California standard for awarding contractual attorneys’ fees and limits involving nonsignatories)
Brown Bark III, L.P. v. Haver, 162 Cal. Rptr. 3d 9 (Cal. Ct. App. 2013) (application of Civ. Code §1717 reciprocity principles to nonsignatory disputes)
4518 S. 256th, LLC v. Karen L. Gibbon, P.S., 382 P.3d 1 (Wash. Ct. App. 2016) (Washington law authorizing contractual fee awards and mutuality principle under RCW 4.84.330)
P.T. Ika Muda Seafoods, Int’l v. Ocean Beauty Seafoods, Inc., 135 Wash. App. 1025 (Wash. Ct. App. 2006) (interpretation of mutuality of remedy under Washington fee statute)
Bloor v. Fritz, 180 P.3d 805 (Wash. Ct. App. 2008) (permitting nonsegregation of fees where allocation is impracticable)
Friends of the Trails v. Blasius, 93 Cal. Rptr. 2d 193 (Cal. Ct. App. 2000) (supporting shared fee awards where claims arise from same facts)
Novato Fire Protection Dist. v. United States, 181 F.3d 1135 (9th Cir. 1999) (failure to raise issues at summary judgment waives them on appeal)