Jenny Smith v. Haynes & Haynes P.C.
940 F.3d 635
| 11th Cir. | 2019Background
- Jenny Smith worked for Haynes & Haynes in two stints; she filed Chapter 13 bankruptcy in April 2011 before her second stint and listed "none" for contingent/unliquidated claims.
- Smith’s Chapter 13 plan was confirmed (100% payment to unsecured creditors) in Aug 2011 and later dismissed in Jan 2013 for failure to pay.
- Smith sued in July 2014 alleging FLSA overtime (misclassification); defendants discovered the bankruptcy omission and consulted experienced attorney John Saxon.
- Saxon met with Smith’s original counsel (Parker), warned of a "serious and fatal judicial estoppel problem," threatened counterclaims, and NELA-AL suspended Parker; counsel recorded the meeting.
- District court granted summary judgment for defendants on overtime and breach-of-contract claims based on judicial estoppel (applying the Burnes/Barger inference) and later granted summary judgment on Smith’s FLSA retaliation claim (finding Saxon’s threats and NELA-AL suspension were not materially adverse or attributable).
- On appeal the Eleventh Circuit affirmed the dismissal of the retaliation claim but vacated the judicial estoppel ruling and remanded for application of Slater v. U.S. Steel’s totality-of-circumstances analysis.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Smith’s failure to disclose the FLSA claim in Chapter 13 bars her overtime and breach claims by judicial estoppel | Smith: omission was inadvertent or she lacked knowledge of a claim until after bankruptcy; no intent to mislead | Defs: nondisclosure is inconsistent and permits inference of intent to deceive (judicial estoppel) | Vacated district court’s estoppel ruling as to bankruptcy omission; remanded to apply Slater II (no automatic inference; consider totality of facts) |
| Whether inconsistent allegations between initial Complaint and Amended Complaint justify judicial estoppel | Smith: amended pleading and sworn declaration corrected earlier inaccuracies; amendments permitted | Defs: contradictory pleadings show inconsistency and intent to manipulate courts | Rejected: court held same-case pleading inconsistencies alone cannot support judicial estoppel; error to rely on them |
| Whether Saxon’s threats to file counterclaims constitute materially adverse action under FLSA retaliation | Smith: threats (and ensuing pressure) were retaliatory and would deter prosecution | Defs: threats during litigation are not materially adverse to dissuade a reasonable claimant | Affirmed for defendants: Saxon’s threats were not materially adverse in context; no liability |
| Whether NELA-AL’s suspension of Parker is attributable to defendants and is materially adverse | Smith: defendants orchestrated suspension as part of retaliation | Defs: suspension was not materially adverse to Smith and no evidence defendants authorized it | Affirmed for defendants: suspension not materially adverse and not attributable to defendants |
Key Cases Cited
- Slater v. U.S. Steel Corp., 871 F.3d 1174 (11th Cir. 2017) (en banc) (rejects automatic inference of intent from bankruptcy nondisclosure; courts must assess totality of facts)
- Burnes v. Pemco Aeroplex, Inc., 291 F.3d 1282 (11th Cir. 2002) (earlier Eleventh Circuit precedent permitting inference of intent from nondisclosure)
- Barger v. City of Cartersville, 348 F.3d 1289 (11th Cir. 2003) (applied inference that nondisclosure supports judicial estoppel)
- Robinson v. Tyson Foods, Inc., 595 F.3d 1269 (11th Cir. 2010) (Chapter 13 debtor’s duty to amend schedules; standard of review for judicial estoppel rulings)
- Burlington N. & Santa Fe Ry. Co. v. White, 548 U.S. 53 (2006) (adverse-action materiality standard: would dissuade a reasonable worker)
- Thompson v. N. Am. Stainless, LP, 562 U.S. 170 (2011) (third-party retaliation can be actionable; apply Burlington reasonable-worker test)