JPMorgan Chase Bank, N.A. v. Larry Winget
678 F. App'x 355
| 6th Cir. | 2017Background
- In 1999 Venture Holdings (controlled by Larry Winget) borrowed $450M; Chase served as administrative agent. A default led to an Eighth Amendment, a Guaranty, and two Pledge Agreements.
- Section 3 of the Guaranty explicitly limited Larry Winget’s personal exposure as to Pledged Stock but did not mention The Larry J. Winget Living Trust (the Trust).
- District court reformed the Guaranty to treat Winget and the Trust as coextensive guarantors after a bench trial finding mutual mistake; entry of judgment followed for ~$425M subject to the reformed limitation.
- This Court (prior appeal) reversed the reformation under Michigan contract law, holding the Guaranty unambiguous and directing the district court to enter judgment for Chase on Count I without the limitation.
- On remand, Winget and the Trust sought to raise judicial estoppel based on statements Chase’s counsel made in a 2006 bankruptcy hearing (referencing a $50M recoverable pledge amount); the district court declined, concluding the Sixth Circuit mandate required entry of judgment and left no room to relitigate estoppel.
- This appeal concerns whether the prior mandate permitted the district court to entertain the newly asserted judicial estoppel defense; the Sixth Circuit affirms the district court’s refusal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the district court on remand could consider Winget/Trust's judicial estoppel defense | Chase: mandate ordered entry of judgment for Chase on Count I; no further proceedings permitted | Winget/Trust: mandate did not adjudicate estoppel; district court could consider it on remand to limit recovery to $50M | Held: Mandate was clear and compelled entry of judgment for Chase; district court correctly refused to reopen estoppel issue |
| Whether prior appellate opinion implicitly left estoppel undecided and open | Chase: prior opinion reversed reformation and instructed entry of judgment, intending final resolution | Winget/Trust: supplemental briefing and oral argument left room to adjudicate estoppel on remand | Held: Court saw no such limitation; prior opinion and mandate foreclosed reopening; supplemental briefing did not preserve right to relitigate |
| Whether Winget/Trust timely pursued judicial estoppel defense | Chase: defendants never actually pursued the defense despite listing it in their Answer | Winget/Trust: reliance on bankruptcy hearing statements justified invoking estoppel on remand | Held: Defendants had opportunities earlier but failed to press the defense; court deemed it forfeited until raised at oral argument |
| Whether Exxon v. Lubrizol compels allowing new theory on remand | Winget/Trust: Exxon supports permitting new theory that became critical after earlier decision | Chase: Exxon is distinguishable; estoppel was not newly critical nor rendered moot by prior decision | Held: Exxon is inapplicable; here estoppel was not newly critical and defendants had previously relied on underlying facts without litigating the defense |
Key Cases Cited
- JPMorgan Chase Bank, N.A. v. Winget, [citation="602 F. App'x 246"] (6th Cir. 2015) (prior panel reversed reformation and remanded with instruction to enter judgment for Chase)
- United States v. Parks, 700 F.3d 775 (6th Cir. 2012) (mandate-interpretation standard and de novo review)
- United States v. Campbell, 168 F.3d 263 (6th Cir. 1999) (mandate rule restricts district court from expanding inquiry on remand)
- Carter v. Mitchell, 829 F.3d 455 (6th Cir. 2016) (entire prior opinion can inform scope of remand)
- Exxon Chem. Patents, Inc. v. Lubrizol Corp., 137 F.3d 1475 (Fed. Cir. 1998) (permitting new theory on remand when it becomes critical; distinguished here)