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Dzakula v. McHugh

United States Court of Appeals, Ninth Circuit

January 15, 2014

MAIDA DZAKULA, Plaintiff-Appellant,
v.
JOHN M. MCHUGH, Secretary of the Army, Defendant-Appellee

Argued and Submitted, San Francisco, California November 22, 2013 [*].

Appeal from the United States District Court for the Northern District of California. D.C. No. 5:10-cv-05462-PSG. Paul S. Grewal, Magistrate Judge, Presiding.

Page 400

Jeanine G. Strong, Carmel, California, for Plaintiff-Appellant.

Stuart F. Delery, Assistant Attorney General, Melinda Haag, United States Attorney, and Mark B. Stern and Melissa N. Patterson, Attorneys, Appellate Staff, Civil Division, Department of Justice, Washington, D.C., for Defendant-Appellee.

Before: Michael Daly Hawkins, Susan P. Graber, and Morgan Christen, Circuit Judges.

OPINION

AMENDED OPINION

GRABER, Circuit Judge:

Plaintiff Maida Dzakula appeals the district court's dismissal of this action, which alleges that certain adverse employment actions by her employer, Defendant John M. discrimination. Plaintiff had filed for Chapter 7 bankruptcy protection, but she failed to list this action as an asset on her bankruptcy schedules. Only when Defendant moved to dismiss this action on the ground of judicial estoppel did Plaintiff amend her bankruptcy schedules to add this potential asset. After Plaintiff added this action to the schedules, the bankruptcy court discharged her debts and closed the case.[1] The district court held that no evidence suggested that Plaintiff's original omission had been inadvertent or mistaken and that, weighing the factors set forth in New Hampshire v. Maine, 532 U.S. 742, 750-51, 121 S.Ct. 1808, 149 L.Ed.2d 968 (2001), judicial estoppel bars this action. Plaintiff timely appeals, and we affirm.

While this appeal was pending, we decided Ah Quin v. County of Kauai Department of Transportation, 733 F.3d 267 (9th Cir. 2013). In that case, the plaintiff-debtor, like Plaintiff here, failed to list her separate action as an asset in her bankruptcy schedules, and the defendant moved to dismiss the action as barred by judicial estoppel. Id. at 269-70. When considering whether the omission was " inadvertent or mistaken," the district court in Ah Quin applied a " narrow interpretation" of those terms and held that, because the plaintiff-debtor knew about the

Page 401

claim and had a motive to conceal it, the omission was not " inadvertent or mistaken" as a matter of law. Id. at 271-72; see id. at 272 (explaining that the district court appeared to conclude that it was " bound to apply" the narrow interpretation). We reversed. We held that " the ordinary understanding of 'mistake' and 'inadvertence'" --not the narrow interpretation applied by the district court--applies. Id. at 277.

We further held that the district court's application of the wrong legal rule was not harmless. See id. at 277-79. The evidence in that case supported " a conclusion either of mistake and inadvertence, or of deceit." Id. at 277. Many circumstances, such as the timing of Plaintiff's amendment to the bankruptcy schedules, suggested that perhaps the omission had been deceitful. Id. at 278. But some circumstances supported the conclusion that the omission had been inadvertent. Id. at 277-78. Of particular note, the plaintiff-debtor had " filed an affidavit in which she swore that, when she reviewed the bankruptcy schedules, she did not think that she had to disclose her pending lawsuit because the bankruptcy schedules were 'vague.'" Id. at 277. " [V]iewing the evidence in the light most favorable to Plaintiff, and thus crediting her affidavit, her bankruptcy filing was inadvertent." Id. at 278 (citation omitted). Accordingly, we remanded for further factual development. Id. at 279.

After we decided Ah Quin, we ordered supplemental briefing on the effect of Ah Quin on this case. We now conclude that Ah Quin is distinguishable. Unlike in Ah Quin, the district court here did not apply the wrong legal rule. Instead, the court correctly assessed whether Plaintiff's omission ...


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