Patriot Manufacturing, LLC v. Hartwig, Inc.

FILED
United States Court of Appeals
UNITED STATES COURT OF APPEALS Tenth Circuit
TENTH CIRCUIT August 21, 2015
_________________________________
Elisabeth A. Shumaker
Clerk of Court
PATRIOT MANUFACTURING, LLC,
Plaintiff - Appellant,
v. No. 14-3232
(D.C. No. 6:10-CV-01206-EFM)
HARTWIG, INC., (D. Kan.)
Defendant - Appellee.
_________________________________
ORDER AND JUDGMENT*
_________________________________
Before KELLY, BALDOCK, and GORSUCH, Circuit Judges.
_________________________________
Some years ago Patriot Manufacturing bought a machine shop lathe from
Hartwig with hope of producing goods for the aircraft industry. But the deal soon
turned sour and Hartwig repossessed the lathe, claiming that Patriot had defaulted on
its payment obligations under the parties’ sales contract. Sure that Hartwig had
breached the same agreement and that it had committed more than a few torts along
the way, Mark Spencer — Patriot’s owner and sole member — filed this federal
lawsuit.
*
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of this
appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore
ordered submitted without oral argument. This order and judgment is not binding
precedent except under the doctrines of law of the case, res judicata, and collateral
estoppel. It may be cited, however, for its persuasive value consistent with
Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
As Hartwig soon discovered, though, the positions Mr. Spencer advanced in
his federal district court complaint were arguably inconsistent with the
representations he made before a federal bankruptcy court just a few days earlier.
Right before filing this lawsuit, Mr. Spencer sought Chapter 7 bankruptcy protection
— a move that eventually won him a discharge of substantial debts. But in his initial
bankruptcy filings, Mr. Spencer expressly denied being an officer, director, or partner
of any company. In fact, he denied having any interest in any business at all.
Seeking to hold Mr. Spencer accountable for his earlier statements disclaiming
any business interests, Hartwig moved for summary judgment in this case on the
theory that Patriot and its sole proprietor should be estopped from vindicating
contract and tort claims that, Hartwig argued, existed before Mr. Spencer’s
bankruptcy and should have been — along with his ownership of the company —
disclosed to the bankruptcy court. See New Hampshire v. Maine, 532 U.S. 742, 749
(2001) (explaining that judicial estoppel “‘generally prevents a party from prevailing
in one phase of a case on an argument and then relying on a contradictory argument
to prevail in another phase’”) (quoting Pegram v. Herdrich, 530 U.S. 211, 227 n.8
(2000)). The district court agreed and entered judgment for Hartwig.
Patriot now asks us to reverse the district court, contending that the bankruptcy
court was never really deceived by Mr. Spencer’s arguably incomplete filings. See
Eastman v. Union Pac. R.R. Co., 493 F.3d 1151, 1156 (10th Cir. 2007) (explaining
that we generally “inquire whether the suspect party succeeded in persuading a court
to accept that party’s former position” before applying judicial estoppel). And
2
arguing that Mr. Spencer won’t gain any sort of “unfair advantage” if Patriot is
allowed to proceed with this lawsuit. See id. (noting that we usually “inquire
whether the party seeking to assert an inconsistent position would gain an unfair
advantage in the litigation if not estopped”).
But whatever the merits of these arguments Patriot failed to make them when
responding to Hartwig’s motion for summary judgment in district court and has,
accordingly, forfeited the chance to win reversal using them in this court. See Adler
v. Wal-Mart Stores, Inc., 144 F.3d 664, 671 (10th Cir. 1998). Instead of arguing to the
district court that estoppel was unwarranted under our case law or suggesting that
estoppel would confer no unfair advantage, Patriot made entirely different (and mostly
inapplicable) arguments under Kansas state law — arguments the company has since
abandoned in this appeal. Neither, for that matter, has Patriot attempted in either of its
briefs on appeal to show that the district court committed plain error in failing to
recognize and develop for the company the arguments it now wishes to develop for itself
in this court for the first time. And faced as we are only with arguments that weren’t
raised below, and lacking any accompanying explanation how the district court’s alleged
error might have been so severe as to nonetheless require correction as plain error, we
decline to disturb its judgment. See Richison v. Ernest Grp., Inc., 634 F.3d 1123,
1127-28 (10th Cir. 2011).
3
Affirmed.
ENTERED FOR THE COURT
Neil M. Gorsuch
Circuit Judge
4