Mary Ann Roberts, 659 B.R. 271

Mary Ann Roberts filed for Chapter 7 bankruptcy in March 2021, without a lawyer, during the Covid-19 pandemic and repeatedly struggled to complete the required paperwork.
Roberts failed to disclose a pending wrongful termination lawsuit (the "AMA Action") on her bankruptcy schedules and at her creditors' meeting.
The undisclosed lawsuit, with potential damages exceeding $67,000, was discovered by AMA Support Services, who then sought to dismiss the suit on judicial estoppel grounds in state court.
The state court paused the AMA Action to allow resolution of bankruptcy-related issues, leading Roberts (through counsel) to seek to reopen her bankruptcy case.
The Chapter 7 Trustee and U.S. Trustee supported reopening the case to allow administration of the omitted asset for the benefit of creditors; AMA opposed.
No parties disputed the material facts, and the court was asked to decide whether reopening the bankruptcy was proper and whether judicial estoppel should prevent administration of the lawsuit.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Should the bankruptcy be reopened to allow administration of the lawsuit?	Proper to reopen to address undisclosed asset for creditors' benefit.	No reopening; concealment was willful, so the case shouldn't be reopened.	Reopening granted to permit trustee to administer the lawsuit.
Does Roberts' omission of the lawsuit bar its administration by judicial estoppel?	Judicial estoppel should not prevent trustee from pursuing the claim; benefit should go to creditors, not allow a windfall for defendant.	Concealment bars the lawsuit; court should apply judicial estoppel.	Judicial estoppel not applied to bar Chapter 7 trustee; creditors' interests outweigh debtor's concealment.
Does the passage of over two years since case closure prevent reopening?	No time limit in Section 350(b); asset was not administered, so reopening is proper.	Delay too long, unfair to defendant.	Passage of time does not bar reopening; precedent supports late reopening for undisclosed assets.
Does AMA have standing to object to reopening the bankruptcy?	Only parties in interest may object.	AMA wants lawsuit dismissed and objects.	AMA lacks standing as it is not a creditor; objection is stricken.

In re Lazy Days’ RV Center, Inc., 724 F.3d 418 (3d Cir. 2013) (reaffirming bankruptcy court’s discretion to reopen cases)
Krystal Cadillac-Oldsmobile GMC Truck, Inc. v. General Motors Corp., 337 F.3d 314 (3d Cir. 2003) (judicial estoppel doctrine in bankruptcy for failure to disclose claims)
New Hampshire v. Maine, 532 U.S. 742 (2001) (factors guiding application of judicial estoppel)
Reed v. City of Arlington, 650 F.3d 571 (5th Cir. 2011) (judicial estoppel should not be used to harm innocent creditors by barring trustee's pursuit of undisclosed claims)
Kane v. National Union Fire Insurance Co., 535 F.3d 380 (5th Cir. 2008) (similar holding regarding trustee and undisclosed claims)
Biesek v. Soo Line R.R. Co., 440 F.3d 410 (7th Cir. 2006) (emphasizes equity in not punishing creditors for debtor’s nondisclosure)
Marrama v. Citizens Bank of Massachusetts, 549 U.S. 365 (2007) (bankruptcy relief reserved for honest debtors)