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Crawford v. Newport News Industrial Corp.

United States District Court, E.D. Virginia, Newport News Division

February 12, 2018

JAMESINA CRAWFORD, et ai, Plaintiffs,
v.
NEWPORT NEWS INDUSTRIAL CORPORATION, Defendant.

          REPORT AND RECOMMENDATION

          LAWRENCE R. LEONARD UNITED STATES MAGISTRATE JUDGE

         A Second Amended Complaint was filed in this Court on May 4, 2015 by thirty-eight Plaintiffs against Defendant Newport News Industrial Corporation ("NNI"). ECF No. 15. The Second Amended Complaint asserts various claims of employment discrimination, retaliation, and hostile work environment by welders, fitters, and laborers employed at or by NNI. NNI filed separate Motions for Summary Judgment against thirty-seven Plaintiffs.[1] Before the Court in this Report and Recommendation are NNI's Motions for Summary Judgment and accompanying memoranda against five of these Plaintiffs: Marvin Smith (ECF Nos. 113, 114), Keith Chisman (ECF Nos. 127, 128), Naseer Marshall (ECF Nos. 137, 138), Kevin Smith (ECF Nos. 157, 158), and Richard Payton (ECF Nos. 179, 180).[2] NNI's Motions were based on several grounds, including that each of these five Plaintiffs failed to disclose their employment discrimination claims in their bankruptcy proceedings, thereby barring Plaintiffs from asserting these claims in this Court based on the doctrine of judicial estoppel. ECF Nos. 113-14; 127-28; 137-38; 157-58; 179-80. The aforementioned Plaintiffs filed memoranda, appendices, and exhibits in opposition. ECF Nos. 198-215. NNI filed individual replies with respect to each Plaintiff, ECF No. 248 (Naseer Marshall), ECF Nos. 257 (Marvin Smith), 262 (Keith Chisman), 266 (Kevin Smith), 268 (Richard Payton), and a single memorandum in response to Plaintiffs' narrative statement of material facts, ECF No. 270. Plaintiffs subsequently filed a Notice of Supplemental Authority advising the Court of an Eleventh Circuit decision on the question of judicial estoppel, an issue raised by NNI in its summary judgment motions. ECF No. 291. NNI responded to this Notice. ECF No. 292. This matter was referred to the undersigned United States Magistrate Judge ("the undersigned") from the United States District Judge. 28 U.S.C. §§ 636(b)(1)(B); Fed.R.Civ.P. 72(b); E.D. Va. Local Civ. R. 72. After reviewing the briefs, the undersigned disposes of the Motions on the papers without a hearing pursuant to Federal Rule of Civil Procedure 78(b) and Local Civil Rule 7(J). The matter is now ripe for recommended disposition.

         I. STANDARD OF REVIEW

         Summary judgment under Federal Rule of Civil Procedure 56 is appropriate when the Court, viewing the record as a whole and in the light most favorable to the nonmoving party, finds there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-50 (1986). A court should grant summary judgment if the nonmoving party, after adequate time for discovery, has failed to establish the existence of an essential element of that party's case, on which that party will bear the burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). To defeat a motion for summary judgment, the nonmoving party must go beyond the facts alleged in the pleadings and instead rely upon affidavits, depositions, or other evidence to show a genuine issue for trial. See Id. at 324. Conclusory statements, without specific evidentiary support, are insufficient. Causey v. Balog, 162 F.3d 795, 802 (4th Cir. 1998). Rather, "there must be evidence on which the jury could reasonably find for the [party]." Anderson, 477 U.S. at 252. Ultimately, cases are not to be resolved on summary judgment where "the depositions [and affidavits] of principal witnesses present conflicting versions of the facts which require credibility determinations." Nilson v. Historic Inns Group, Ltd., 903 F.Supp. 905, 909 (D. Md. 1995) (citing Davis v. Zahradnick, 600 F.2d 458, 460 (4th Cir. 1979); Sosebee v. Murphy, 797 F.2d 179, 182 (4th Cir. 1986)).

         II. UNDISPUTED MATERIAL FACTS

         A. General

         NNI provides fabrication, construction, equipment repair, and technical services to energy and petrochemical companies. ECF No. 114, Statement of Fact ("SOF") No. 1; ECF No. l28, SOF No. 1; ECF No. 138, SOF No. 1; ECF No. 158, SOF No. 1; ECF No. 180, SOF No. I.[3]NNI utilizes employees in various job classifications, including welders, fitters, and laborers. Welders, fitters, and laborers report to a Foreman (i.e., a supervisor), who, in turn, reports to a Superintendent. ECF No. 114, SOF No. 2; ECF No. 128, SOF No. 2; ECF No. 138, SOF No. 2; ECF No. 158, SOF No. 2; ECF No. 180, SOF No. 2.

         B. Marvin Smith

         Plaintiff M. Smith has asserted claims against NNI in the Second Amended Complaint for both racially hostile work environment and disparate treatment in pay, promotions, overtime and training, based on race. ECF No. 15.

         M. Smith and his wife filed a voluntary petition for bankruptcy in the Eastern District of Virginia under Chapter 13 of the Bankruptcy Code on September 17, 2013. In re: Marvin Gaye Smith, No. 13-51497, Doc. I.[4] He was represented by attorney Peter Zooberg, and the Bankruptcy Court appointed Michael P. Cotter as Trustee ("Trustee Cotter"). Id. He was subsequently hired at NNI on February 3, 2014 as a welder. ECF No. 114, SOF No. 3. The Chapter 13 plan was confirmed by the Bankruptcy Court on March 12, 2014, and included the following payment plan: "On October 17, 2013 and each month thereafter until further order, Liebherr America Inc. the employer of the debtor, shall deduct from the wages, salary or commissions of the debtor and pay the sum of $2, 255.00 per month for 60 months: Total Funding $135, 300." In re: Marvin Gaye Smith, Doc. 20. On July 15, 2014, M. Smith filed an Amended Schedule which added to the list of creditor(s), but did not disclose any claim against NNI. Id., Doc. 26. M. Smith joined this lawsuit (Crawford v. NNI) with the filing of the Second Amended Complaint on May 4, 2015. ECF No. 114, SOF No. 38.

         On January 12, 2016, Trustee Cotter filed a Motion to Dismiss Case for Failure to Make Plan Payments. In re: Marvin Gaye Smith, Doc. 30. The Bankruptcy Court then issued an Order Settling the Motion to Dismiss, which ordered debtors to resume regular plan payments and make an additional payment to cure arrears. Id., Doc. 32. On May 26, 2016, the Bankruptcy Court issued an Order of Dismissal for the failure of the debtors to comply with the Order Settling Motion to Dismiss entered on January 29, 2016 by failing to make payments. Id. Doc. 34. At no time during the pendency of the bankruptcy action did M. Smith ever disclose his interest in a claim against NNI. Id., passim.

         C. Keith Chisman

         Chisman has asserted claims against NNI in the Second Amended Complaint for both racially hostile work environment and disparate treatment in pay, promotions, overtime and training, based on race. ECF No. 15.

         Chisman worked on and off at NNI as a fitter between March 2010 and late 2012. ECF No. 128, SOFs 3, 6, 7, 10. On January 2, 2013, Chisman's attorney Joshua Friedman sent by Federal Express a letter to NNI announcing an intention, on behalf of Chisman[5] and several others, "to sue NNI (the 'Employer') for racial harassment/hostile work environment, disparate treatment and retaliation." Id., attach. 17. Chisman and his wife filed a voluntary petition for bankruptcy in the Eastern District of Virginia under Chapter 7 of the Bankruptcy Code on August 18, 2014. In re Keith Chisman, No. 14-51163, Doc. 1. He was represented by attorney Ryan Marion, and Clara Swanson was appointed Trustee. Id. Chisman did not disclose this employment discrimination claim on his voluntary petition. Id. Specifically, line 21 of the Schedule B - Personal Property, requires a debtor to identify: "Other contingent and unliquidated claims of every nature, including tax refunds, counterclaims of the debtor, and rights to setoff claims. Give estimated value of each." Id. at 11. Chisman disclosed:

Any interest in property that Debtor acquires or becomes entitled to acquire within 180 days of the filing of the petition for bankruptcy by bequest, devise, or inheritance, as a result of a property settlement agreement or of a divorce decree, or as a beneficiary of a life insurance policy or a death benefit plan, a refund of federal and state taxes received for 2011, proceeds from pre-petition and post-petition garnishment of wages, bank accounts, cash values for any life insurance policies, deposit accounts or any other assets and/or lottery of other winnings.

Id. He placed a value of this asset at $1.00. Id.

         On September 24, 2014, the Trustee issued a Report of No. Distribution, finding that there was no property available for distribution from the estate beyond that exempted by law. Id., Doc. 10. Reaffirmation of a debt to one creditor was ordered "not disapproved" by the Bankruptcy Court on November 17, 2014. Id. Doc. 15. Chisman was discharged from bankruptcy on December 1, 2014. Id., Doc. 18. The bankruptcy case was closed on December 8, 2014. Id. Doc. 20.

         D. Naseer Marshall

         Marshall has asserted claims against NNI in the Second Amended Complaint for racially hostile work environment, disparate treatment in pay, promotions, overtime and training, based on race, termination because of race, and retaliation. ECF No. 15.

         NNI contracts out some of its work to Steel America, and Marshall was hired by Steel America to perform welding work at NNI in August 2013. ECF No. 138, SOFs 3-4. Marshall originally became a party to the Crawford v. NNI litigation on February 11, 2015 when he filed the First Amended Complaint. ECF No. 7. Seven months later, on September 14, 2015, Marshall filed a voluntary petition for bankruptcy in the Eastern District of Virginia under Chapter 7 of the Bankruptcy Code. In re Naseer Marshall, No. 15-73144, Doc. 1. He was represented by attorney Timothy Douglass in the bankruptcy action, and Tom Smith was appointed Trustee. Id. Marshall did not disclose this employment discrimination claim on the Schedule B - Personal Property section of his voluntary petition. Id. at 10. On October 22, 2015, the Trustee issued a Report of No. Distribution, finding that no assets were available for distribution from the estate to satisfy creditors over and above that exempted by law. Id., Doc. 11. Marshall's attorney then filed an Amended Schedule on December 7, 2015, which added a creditor, but did not disclose the claim manifested in this discrimination lawsuit. Id. Doc. 12. Marshall received his Discharge of Debtor on December 28, 2015, and his case was closed on January 4, 2016. Id. Docs. 14, 16.

         On February 25, 2016, the Trustee filed a Motion to Reopen the Bankruptcy Case on the grounds that, "at the time of filing [the bankruptcy case], Mr. Marshall was a plaintiff in a pending discrimination lawsuit against BAE Systems[6] which was filed prior to the bankruptcy." Id. Doc. 17 at 1. The Trustee further averred that "the debtor did not disclose the potential cause of action in his bankruptcy," and that "[c]ounsel for the debtor recently advised the former trustee of the cause of action." Id. The Bankruptcy Court held a hearing on the Motion on April 6, 2016, and on April 14, 2016 issued an Order granting the Motion and directing the appointment of a trustee, "who is authorized to collect and administer the assets of this estate." Id., Doc.23atl.

         On August 25, 2016, Trustee Tom Smith filed an application to employ Joshua Friedman, Marshall's attorney herein, "to represent the Trustee of the bankruptcy estate of Naseer Marshall against [NNI]." Id. Doc. 26 at 3. The Bankruptcy Court granted the Motion on September 16, 2016, ordering that "the trustee's Motion to employ Joshua Friedman to represent the trustee in the litigation of the claim of Naseer Marshall against [NNI] is hereby approved ..." Id. Doc. 28 at 2. As of the date of this Report and Recommendation, Marshall has not submitted in the Bankruptcy Court an Amended Schedule A/B: Property, reflecting a description of and value of the claim in this lawsuit. Id. passim. As of the date of this Report and Recommendation, the Trustee, as the real party in interest, has not submitted a Motion to Intervene pursuant to Fed.R.Civ.P. 17 here in the District Court.

         E. Kevin Smith

         K. Smith has asserted claims against NNI in the Second Amended Complaint for both racially hostile work environment and disparate treatment in pay, promotions, overtime and training, based on race. ECF No. 15.

         K. Smith has worked off and on at NNI since September, 2010, when he was hired to a temporary position as a fitter. ECF No. 158, SOF 4, 6, 14, 15. In January 2013, attorney Freidman sent a letter to NNI on K. Smith's behalf advising that he intended to sue NNI for discrimination and harassment. Id. SOF. No. 109. On August 1, 2014 K. Smith and his wife filed a voluntary petition for bankruptcy in the Eastern District of Virginia under Chapter 7 of the Bankruptcy Code. In re Kevin Smith, No. 14-51091, Doc. 1. He was represented by attorneys Peter Zooberg and Charles Havener in the bankruptcy action, and David Ruby was appointed as Trustee. Id. At the time he filed the bankruptcy petition, he believed he had already been discriminated against and harassed by NNI. ECF No. 158, SOF No. 100. K. Smith did not disclose this employment discrimination claim on his voluntary petition. Id., SOF No. 105; In re Kevin Smith, Doc. 1. On September 9, 2014, the Trustee issued a Report of No. Distribution, finding that no assets were available for distribution from the estate to satisfy creditors over and above that exempted by law. In re Kevin Smith, Doc. 10. K. Smith received his Discharge of Debtor on November 12, 2014, and his case was closed on November 17, 2014. M, Docs. 12 and 14.

         On February 11, 2015, K. Smith originally became a party to the Crawford v. NNI litigation when he filed the First Amended Complaint. ECF No. 7. Eighteen months later, on August 5, 2016, K. Smith, through attorney Zooberg, filed a Motion to Reopen Bankruptcy Case on the grounds that "debtors inadvertently failed to list an asset for a claim of damages related to a workplace discrimination class action suit in Schedule B of the voluntary petition." In re Kevin Smith, Doc. 15 at 2. The Motion acknowledged: "as the alleged actions identified by the defendant that gave rise to Mr. Smith's cause of action occurred pre-petition, this cause of action should have been disclosed as a potential asset in the bankruptcy filing, and Debtors regrets [sic] the error." Id. K. Smith sought to reopen the closed bankruptcy "for the purpose of amending their schedules to properly disclose this asset." Id., at 3.

         The Bankruptcy Court held a hearing on October 7, 2016 and granted the Motion. Id., Doc. 19. That Court issued an Order Reopening the Case and directing the appointment of a trustee. Id., Doc. 20. David Ruby was appointed Trustee on November 16, 2016. Id., Doc. 22. On January 5, 2017, attorney Havener filed an Amended Schedule A/B: Property, reflecting a description of the claim in the Crawford v. AW/lawsuit, and providing an asset value of $50, 000. Id., Doc. 23 at 7. K. Smith also claimed an exemption of the entire amount of the claim, citing Va. Code § 34-28.1 ("the Personal Injury Exemption"). Id. at 11. The Trustee filed a Motion for Extension of Time within Which to Object to Personal Injury Exemption on February 6, 2017. Id. Doc. 25. The Motion was granted on March 1, 2017. Id. Doc. 28. The Trustee filed a second such Motion seeking an additional extension on May 8, 2017. Id., Doc. 30. Subsequently, on May 25, 2017, K. Smith filed another Amended Schedule in which he no longer claimed a Personal Injury Exemption for the claim asserted in Crawford v. NNI. Id. Doc. 33. As of the date of this Report and Recommendation, the Trustee, as the real party in interest, has not submitted a Motion to Intervene pursuant to Fed.R.Civ.P. 17 here in the District Court.

         F. Richard Payton

         Payton has asserted claims against NNI in the Second Amended Complaint for both racially hostile work environment and disparate treatment in pay, promotions, overtime and training, based on race. ECF No. 15.

         On August 22, 2013, Payton and his wife filed a voluntary petition for bankruptcy in the Eastern District of Virginia under Chapter 13 of the Bankruptcy Code. In re Richard Payton, No. 13-51357, Doc. 1. He was represented by attorney Shanna Harris in the bankruptcy action, and Michael Cotter was appointed as Trustee. Id. On September 4, 2013, Payton filed his Chapter 13 Plan. Id. Doc. 10. Payton, who had been unemployed for one year, was then hired as a laborer at NNI on October 17, 2013. ECF No. 180, SOFs No. 3, 7. On November 25, 2013, the Bankruptcy Court issued its Order Confirming Plan.[7] In re Richard Payton, Doc. 11. Payton filed an Amended Schedule F on January 9, 2014 updating the list of creditors who held unsecured nonpriority claims. Id., Doc. 16. On April 23, 2014, the Trustee filed a Motion and Notice to Allow Claims, identifying the claims of creditors who had filed claims seeking distribution from the estate. Id., Doc. 20. The Bankruptcy Court issued its Order Approving Claims on May 28, 2014. Id. Doc. 21. On June 23, 2014, attorney Harris filed an Amended Motion to Dismiss Chapter 13 Case By Debtors, without prejudice, on the grounds that "the debtors no longer wish to proceed with their Chapter 13 Bankruptcy Case." Id. Doc. 33. The Bankruptcy Court granted the Motion to Dismiss and dismissed the case without prejudice on July 29, 2014. Id., Doc. 35. The Trustee issued his Final Report and Account on August 29, 2014. Id. Doc. 39. The Final Report and Account showed that, during the pendency of the Chapter 13 Plan, $7, 631.00 was disbursed to creditors and $3, 489.00 was disbursed as Expenses of Administration. Id. The bankruptcy case was closed on September 5, 2014.

         Payton left his employment at NNI on July 22, 2014. ECF No. 180, SOF No. 8. As of January 9, 2014, Payton believed he had been harassed and discriminated against by Supervisor Wayne Jackson and co-workers. Id., SOF No. 95.[8] At no time during the pendency of his bankruptcy did Payton disclose his ...


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