Simmers v. National Railroad Passenger Corporation (Amtrak)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
ANDREW SIMMERS,
Plaintiff,
v. Civil Action No. 20-1548 (JEB)
NATIONAL RAILROAD PASSENGER
CORPORATION,
Defendant.
MEMORANDUM OPINION
Claiming that he was injured while working for his employer, Defendant National
Railroad Passenger Corporation (Amtrak), Plaintiff Andrew Simmers brought this suit seeking
damages under the Federal Employers’ Liability Act. The problem for Simmers, as Amtrak
points out, is that he filed for bankruptcy after the injury, and such filing transfers an individual’s
assets (including known legal claims) to the bankruptcy trustee. This means that, at least as of
now, only the trustee has standing to pursue Simmers’s FELA cause of action. The Court will
thus dismiss this case without prejudice for want of subject-matter jurisdiction.
I. Background
According to the Complaint, on May 29, 2019, Plaintiff, a foreman at Amtrak, suffered
injuries to his upper body when trying to remove rail jacks from the back of a utility truck. See
ECF No. 1 (Compl.), ¶ 8. Two weeks later, his counsel notified Defendant of the incident and
warned it to preserve information and evidence that might be relevant to future litigation. See
ECF No. 12 (Def. MSJ), Exh. A (6/13/19 Letter). He subsequently filed this suit on June 12,
2020.
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Prior to lodging his Complaint here, however, Simmers, represented by counsel, filed a
Petition for Bankruptcy in the United States Bankruptcy Court for the District of Maryland. See
Def. MSJ, Exh. B (Petition). (As the Court explains below, it may be relevant down the road that
in his list of assets submitted there, he did not mention his potential FELA claim against
Amtrak.) On January 28, 2020, the Bankruptcy Court issued an Order of Discharge, id., Exh. C
(Order), discharging Plaintiff from approximately $50,000 of debt owed to multiple creditors.
See Petition at ECF pp. 8, 19–26. Citing this proceeding, Amtrak now moves for summary
judgment, contending both that Simmers lacks standing here and that his suit is barred by the
principle of judicial estoppel.
II. Legal Standard
As the Court decides this matter on standing grounds, it lays out only the standard under
Federal Rule of Civil Procedure 12(b)(1). When a defendant brings a Rule 12(b)(1) motion to
dismiss, the plaintiff must demonstrate that the Court indeed has subject-matter jurisdiction to
hear his claims. See Lujan v. Defs. of Wildlife, 504 U.S. 555, 561 (1992); U.S. Ecology, Inc. v.
U.S. Dep’t of Interior, 231 F.3d 20, 24 (D.C. Cir. 2000). “Absent subject matter jurisdiction over
a [claim], the court must dismiss it.” Bell v. U.S. Dep’t of Health & Human Servs., 67 F. Supp.
3d 320, 322 (D.D.C. 2014). “Because subject-matter jurisdiction focuses on the court’s power to
hear the plaintiff’s claim, a Rule 12(b)(1) motion [also] imposes on the court an affirmative
obligation to ensure that it is acting within the scope of its jurisdictional authority.” Grand
Lodge of Fraternal Order of Police v. Ashcroft, 185 F. Supp. 2d 9, 13 (D.D.C. 2001).
In policing its jurisdictional borders, a court must scrutinize the complaint, treating its
factual allegations as true and granting the plaintiff the benefit of all reasonable inferences that
can be derived from the alleged facts. See Jerome Stevens Pharms., Inc. v. FDA, 402 F.3d 1249,
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1253 (D.C. Cir. 2005). The court need not rely “on the complaint standing alone,” however, but
may also look to undisputed facts in the record or resolve disputed ones. See Herbert v. Nat’l
Acad. of Scis., 974 F.2d 192, 197 (D.C. Cir. 1992).
III. Analysis
Defendant Amtrak first argues that any legal claim that an individual is pursuing (or
knows about and may pursue in the future) when he files for Chapter 7 bankruptcy is transferred
by such filing to the trustee. As the debtor no longer possesses the claim, he has no standing to
prosecute it. See MSJ at 13–14. This is correct. The D.C. Circuit has explained the law, which
applies here given that Simmers’s FELA claim arose prior to the filing of his Petition:
In the context of bankruptcy proceedings, it is well understood that
“a trustee, as the representative of the bankruptcy estate, is the real
party in interest, and is the only party with standing to prosecute
causes of action belonging to the estate once the bankruptcy petition
has been filed.” Kane v. Nat’l Union Fire Ins. Co., 535 F.3d 380,
385 (5th Cir. 2008) (per curiam). The commencement of Chapter 7
bankruptcy extinguishes a debtor’s legal rights and interests in any
pending litigation, and transfers those rights to the trustee, acting on
behalf of the bankruptcy estate. See 11 U.S.C. § 541(a)(1)
(indicating that a bankruptcy estate includes “all legal or equitable
interests of the debtor in property”); id. § 323 (establishing the
bankruptcy trustee as the “representative” of the estate with the
“capacity to sue and be sued” on its behalf). Thus, “[g]enerally
speaking, a pre-petition cause of action is the property of the Chapter
7 bankruptcy estate, and only the trustee in bankruptcy has standing
to pursue it.” Parker [v. Wendy’s Intern., Inc.], 365 F.3d [1268,]
1272 [(11th Cir. 2004)]; accord Turner v. Cook, 362 F.3d 1219,
1225–26 (9th Cir. 2004); Detrick v. Panalpina, Inc., 108 F.3d 529,
535 (4th Cir. 1997).
Moses v. Howard Univ. Hosp., 606 F.3d 789, 795 (D.C. Cir. 2010); see also In re Bailey, 306
B.R. 391, 392 (Bankr. D.D.C. 2004) (“In a chapter 7 bankruptcy case, any unliquidated lawsuits
initiated by a debtor prepetition (or that could have been initiated by the debtor prepetition)
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become part of the bankruptcy estate subject to the sole direction and control of the trustee,
unless exempted or abandoned or otherwise revested in the debtor.”).
As Bailey mentions, one significant exception exists to this rule. In the event the trustee
abandons a claim, it reverts to the debtor, who may then pursue it himself. This is also a point
that our Court of Appeals has elucidated:
An outstanding legal claim that is abandoned by the trustee reverts
back to the original debtor-plaintiff. See 11 U.S.C. § 554(a)
(directing that “[a]fter notice and a hearing, the trustee may abandon
any property of the estate that is burdensome . . . or that is of
inconsequential value and benefit to the estate”); id. § 554(c)
(directing that “any property scheduled . . . [but] not otherwise
administered at the time of the closing of a case is abandoned to the
debtor and [considered] administered”). “‘[U]pon abandonment . . .
the trustee is . . . divested of control of the property because it is no
longer part of the estate . . . . Property abandoned under
[§] 554 reverts to the debtor, and the debtor’s rights to the property
are treated as if no bankruptcy petition was filed.’” Kane, 535 F.3d
at 385 (quoting 5 Collier on Bankruptcy ¶ 554.02[3], p. 554–[5]5);
see also Parker, 365 F.3d at 1272.
Moses, 606 F.3d at 795; see also Dalley v. Mitchell Rubenstein & Assoc., P.C., 172 F. Supp. 3d
6, 13 (D.D.C. 2016) (“Under well-settled law, title to claims that have been transferred to the
bankruptcy estate to be handled by the trustee remains in the estate unless the cause of action is
abandoned back to the debtor pursuant to § 554 of the Bankruptcy Code.”).
Simmers cannot rely on this exception here since the claim was never listed as an asset or
addressed at any bankruptcy hearing. As discussed above, moreover, “‘[a]bandonment’ is a term
of art, and the limited circumstances under which abandonment can be deemed to have occurred
are delineated in § 554 of the Bankruptcy Code. Dalley, 172 F. Supp. 3d at 13. Without going
into more detail, that section enumerates circumstances that do not exist here. As the trustee has
never abandoned the claim, Simmers is not free to prosecute it himself. Id. at 14 (“But where
nothing in the record shows that a trustee ever abandoned a debtor’s cause of action, dismissing a
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complaint brought by the debtor for lack of standing is proper.”) (cleaned up) (quoting Marshall
v. Honeywell Tech. Sols., Inc., 675 F. Supp. 2d 22, 26 (D.D.C. 2009)); see also Parker, 365 F.3d
at 1272 (stating that lack of standing, not judicial estoppel, is more appropriate defense where
debtor brings claim that was not abandoned by trustee).
One final point bears mention. As the Court finds no standing, it will dismiss the case
without prejudice, which means that the trustee may renew the suit, or Simmers may refile in the
event the trustee subsequently abandons the claim. In the latter instance, however, Plaintiff will
need to overcome Amtrak’s alternative defense of judicial estoppel, which courts may invoke
“[w]here a party assumes a certain position in a legal proceeding, . . . succeeds in maintaining
that position, . . . [and then,] simply because his interests have changed, assume[s] a contrary
position.” New Hampshire v. Maine, 532 U.S. 742, 749 (2001). Although there may be
exceptions based on the debtor’s knowledge or state of mind, “[t]he federal courts have
developed a basic default rule: If a plaintiff-debtor omits a pending (or soon-to-be-filed) lawsuit
from the bankruptcy schedules and obtains a discharge (or plan confirmation), judicial estoppel
bars the [plaintiff’s] action.” Quin v. Cty. of Kauai Dep’t of Transp., 733 F.3d 257, 271 (9th Cir.
2013); accord Robinson v. District of Columbia, 10 F. Supp. 3d 181, 185 (D.D.C. 2014). This
doctrine, conversely, would not pose an obstacle for the trustee.
IV. Conclusion
The Court, accordingly, will issue a contemporaneous Order granting Defendant’s
Motion and dismissing this action without prejudice.
/s/ James E. Boasberg
JAMES E. BOASBERG
United States District Judge
Date: December 2, 2020
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