Jackson v. GMAC Mortgage Corporation
1:12-cv-00111
S.D. Ala.May 1, 2017Background
- Plaintiff Corla Jackson sued GMAC Mortgage, LLC in the Southern District of Alabama.
- Jackson filed Proof of Claim 4443 in GMAC's SDNY bankruptcy, alleging substantially the same claims as in this federal action.
- The SDNY bankruptcy court expunged and disallowed Claim 4443, concluding it lacked merit and was barred by judicial estoppel; Jackson appealed but district and circuit review did not revive the claim.
- The SDNY bankruptcy confirmed a plan and entered orders (including procedures enforcing injunctive provisions) that discharge prepetition claims and bar Jackson from further litigating these claims against GMAC.
- GMAC moved (via status report) to dismiss this Alabama action as barred by the SDNY bankruptcy rulings and related doctrines (res judicata, discharge); the district court lifted the stay and ordered Jackson to show cause by May 22, 2017 why the case should not be dismissed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Jackson's claims are barred by the SDNY bankruptcy disallowance/confirmation | Jackson contests that SDNY rulings fully preclude her; asserts SDNY has not "won this complaint" | GMAC: SDNY disallowed Claim 4443, confirmation discharged prepetition claims, so res judicata and discharge bar this suit | Court treated SDNY orders as preclusive and ordered Jackson to show cause why case should not be dismissed |
| Whether res judicata/claim preclusion applies | Jackson implicitly argues claims remain viable in this forum | GMAC: bankruptcy court's expungement is a final judgment on the merits and precludes relitigation | Court relied on res judicata principles invoked by GMAC in issuing show-cause order |
| Whether judicial estoppel bars claims asserted here | Jackson previously included these allegations in bankruptcy proceedings (she contests effect) | GMAC: judicial estoppel and prior bankruptcy filings prevent inconsistent positions | Court noted SDNY found judicial estoppel and lack of merit (supporting preclusion) |
| Whether dismissal would be futile because claims are discharged | Jackson argues continued litigation is appropriate | GMAC: Plan/Confirmation discharged prepetition claims; litigation would be futile | Court concluded discharge/plan likely bars the claims and required Jackson to explain why dismissal is improper |
Key Cases Cited
- In re Production Plating, Inc., 90 B.R. 277 (Bankr. E.D. Mich. 1988) (discharge in bankruptcy extinguishes prepetition obligations)
- In re Residential Capital, LLC, 508 B.R. 838 (Bankr. S.D.N.Y. 2014) (bankruptcy disallowance and plan discharge can render further litigation futile)
- EDP Med. Computer Sys. v. United States, 480 F.3d 621 (2d Cir. 2007) (an order expunging a proof of claim is a final judgment permitting res judicata effect)
- Cost v. Super Media, 482 B.R. 857 (S.D.N.Y. 2012) (confirmation order and plan can discharge preconfirmation claims and disallowance is a basis for res judicata)