Consumer Finance Litigation

In Dzakula v. McHugh, No. 11-16404, 2013 WL 6483614 (9th Cir. Dec. 11, 2013), the U.S. Court of Appeals for the Ninth Circuit affirmed the dismissal of an action on the ground of judicial estoppel where the plaintiff failed to identify the action as an asset on her bankruptcy schedules. The plaintiff did not amend the bankruptcy schedules until after the defendant filed a motion to dismiss, leading the court to infer that her omission had not been inadvertent. Distinguishing its recent decision Ah Quin v. County of Kauai Department of Transportation, 733 F.3d 267 (9th Cir. 2013), the Ninth Circuit stressed that the plaintiff presented no evidence explaining her initial failure to include the action on her bankruptcy schedules. Thus, based on the record, in particular "the timing of Plaintiff's amendment and her choice not to file a declaration explaining her initial error, no reasonable fact-finder could conclude that the omission was inadvertent or mistaken." Turning next to the three main factors in applying judicial estoppel set forth in New Hampshire v. Maine, 532 U.S. 742, 121 S. Ct. 1808, 149 L. Ed. 2d 968 (2001), the Ninth Circuit found no abuse of discretion in the district court's analysis. For more information on consumer finance litigation topics, please contact one of the Burr & Forman team members for assistance. We are happy to answer any questions or concerns you may have.