Thompson v. Earthlink Shared Services, LLC
956 F. Supp. 2d 1317
N.D. Ala.2013Background
- Plaintiff Anthony Martin filed a job-discrimination suit under Title VII, § 1981, and the ADA against EarthLink on December 26, 2012.
- EarthLink moved for summary judgment asserting judicial estoppel based on Martin’s bankruptcy-related disclosure issues; concurrently Martin sought to substitute the Chapter 7 trustee, Judith Thompson, as real party in interest.
- The bankruptcy court approved the trustee’s employment of Martin’s counsel to continue prosecution of estate claims; a substitution motion was pending in district court.
- Martin argued (alternatively) that even if judicial estoppel could apply to him, it should not bar the trustee from pursuing estate claims under Eleventh Circuit precedent.
- The district court denied EarthLink’s summary-judgment motion and granted the substitution motion, substituting Trustee Thompson as the real party plaintiff.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether judicial estoppel bars the trustee from prosecuting the discrimination claims | Trustee (via Martin) argues trustee did not take inconsistent positions and Parker protects trustees from estoppel | EarthLink argues judicial estoppel should bar the trustee and distinguishes Parker, relying on Burnes and other authorities | Court held judicial estoppel does not bar the Chapter 7 trustee from pursuing the claims and denied summary judgment |
| Whether the trustee may be substituted as real party in interest | Trustee seeks substitution; bankruptcy court approved employment of current counsel to pursue estate claims | EarthLink opposed substitution citing prior decisions (Jones, Marshall) | Court granted substitution and ordered trustee substituted as real party plaintiff |
| Whether Burnes controls over Parker for trustee estoppel issues | Martin argues Parker is controlling and distinguishes Burnes facts | EarthLink argues Burnes supports estopping litigants who omitted claims from bankruptcy schedules | Court held Parker is controlling for trustees and Burnes is distinguishable (related to debtors, not trustees) |
| Whether timing of substitution/intervention matters to Parker protection | Martin/Trustee argue timing does not limit Parker’s protection for an "innocent" trustee | EarthLink contends Parker is distinguishable because of procedural timing in that case | Court rejected a timing limitation and found no temporal requirement in Parker |
Key Cases Cited
- Parker v. Wendy’s Int’l, Inc., 365 F.3d 1268 (11th Cir. 2004) (trustee who did not take inconsistent positions is not subject to judicial estoppel)
- Burnes v. Pemco Aeroplex, Inc., 291 F.3d 1282 (11th Cir. 2002) (judicial estoppel may bar a debtor who omitted claims from bankruptcy schedules; courts must consider circumstances)
- De Leon v. Comcar Indus., Inc., 321 F.3d 1289 (11th Cir. 2003) (affirming application of judicial estoppel to a debtor who failed to disclose claims)
- Barger v. City of Cartersville, 348 F.3d 1289 (11th Cir. 2003) (discussing limits of bankruptcy disclosure and distinguishing injunctive relief from monetary claims)