# Snyder v. Polymer Machinery Company, Inc.

> District Court, N.D. Ohio · March 31, 2023

URL: https://www.frixlaw.com/law-library/cases/10371948

## Case

- **Court:** District Court, N.D. Ohio
- **Decided:** March 31, 2023
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10371948

## Opinion text

PEARSON, J.
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION

GREGORY C. SNYDER JR, )
) CASE NO. 5:22CV1496
Plaintiff, )
)
v. ) JUDGE BENITA Y. PEARSON
)
POLYMER MACHINERY )
COMPANY INC., et al., ) MEMORANDUM OF OPINION
) AND ORDER
Defendants. ) [Resolving ECF No. 14]

Pending is Defendants Polymer Machinery Company, Inc. (“Polymer Machinery’) and
Kendall Ashby’s Motion to Dismiss (ECF No. 14). The Court has been advised, having
reviewed the record, the parties’ briefs,’ and the applicable law. For the reasons that follow, the
Court grants summary judgment to Defendants.

' Plaintiff supports his response to the motion with a Declaration (ECF No. 24-1).
As the party who chose to present matters outside the pleadings in his response, Plaintiff
had a reasonable opportunity to present all pertinent material in his declaration and took
advantage of that right. Considering the declaration, the Court converts the within
motion into one for summary judgment. See, e.g., Schultz v. Hydro-Gear Ltd.
Partnership, No. 5:12-CV-10, 2012 WL 3527068, at *3 (W.D. Ky. Aug. 15, 2012) (“A
party cannot claim to have been ‘surprised by the conversion of the motion to dismiss into
a motion for summary judgment when the party was aware that materials outside the
pleading had been submitted to the court before the court granted the motion.’ ”) (quoting
Song v. City of Elyria, 985 F.2d 840, 842 (6th Cir. 1993)).

(5:22CV 1496)
1.
A.
Plaintiff Gregory C. Snyder Jr. filed a Chapter 13 bankruptcy in the U.S. Bankruptcy
Court for the Northern District of Ohio. See Jn re Gregory C. Snyder, Jr. (Bankr. N.D. Ohio
filed Nov. 20, 2020). From February 2015 to June 2022, Plaintiff was employed as a service
technician at Polymer Machinery. Thereafter, the above-entitled action asserting violations of
the Fair Labor Standards Act (“FLSA”), Ohio Rev. Code § 4111.03 and regulations thereunder
was filed in this Court on August 22, 2022. It is well-settled that a cause of action is an asset that
must be disclosed in the debtor’s schedule of personal property pursuant to 11 U.S.C. § 521.
Eubanks v. CBSK Fin. Grp., Inc., 385 F.3d 894, 897 (6th Cir. 2004). The duty of disclosure in
bankruptcy “is a continuing one, and a debtor is required to disclose all potential causes of
action.” Schultz, 2012 WL 3527068, at *4 (quoting Jn re Coastal Plains, Inc., 179 F.3d 197, 208
(Sth Cir. 1999)).
Defendants argue judicial estoppel bars Plaintiff's overtime compensation claims because
they were not disclosed in the previously filed Chapter 13 bankruptcy prior to the filing of
Defendants’ initial Motion to Dismiss (ECF No. 8) in the case at bar on October 20, 2022.
Generally, the doctrine of judicial estoppel “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.”
New Hampshire v. Maine, 532 U.S. 742, 749 (2001) (quoting Pegram v. Herdrich, 530 U.S. 211,
227 n. 8 (2000)). The Sixth Circuit has stressed that the doctrine of judicial estoppel preserves
‘the integrity of the courts by preventing a party from abusing the judicial process through

(5:22CV 1496)
cynical gamesmanship.’ ” Schultz, 2012 WL 3527068, at *4 (quoting Browning v. Levy, 283
F.3d 761, 776 (6th Cir. 2002) (Chapter 11 case) (quoting Teledyne Indus., Inc. v. NERB, 911 F.2d
1214, 1218 (6th Cir. 1990))). In Stanley v. FCA US, LLC, 51 F.4th 215 (6th Cir. 2022) (Chapter
13 case), the Court of Appeals affirmed the district court’s application of judicial estoppel to bar
the plaintiff's Family and Medical Leave Act (“FMLA”) interference claim. /d. at 221. The
Sixth Circuit stated: “[w]hen a separate bankruptcy proceeding is involved, judicial estoppel
bars an undisclosed suit when: ‘(1) the debtor assumed a position contrary to one she asserted
under oath while in bankruptcy; (2) the bankruptcy court adopted the contrary position either as a
preliminary matter or as part of a final disposition; and (3) the debtor’s omission did not result
from mistake or inadvertence.’ Kimberlin y. Dollar Gen. Corp., 520 F. App’x 312, 314 (6th Cir.
2013) (citing [White v. Wyndham Vacation Ownership, Inc., 617 F.3d 472, 478 (6th Cir.
2010)]).” Jd. at 219, All three prongs of the White test are met in the present case.
Plaintiff filed the present case without alerting either this Court to his bankruptcy
proceeding or the bankruptcy court to the existence of these claims. Plaintiff only made attempts
to alert the Chapter 13 Trustee and assert claims on behalf of his bankruptcy estate after ECF No.
8 was filed.” A Joint Motion and Application to appoint Ryan A. Winters, Plaintiffs Counsel in
the case at bar, as special counsel was filed by the Chapter 13 Trustee and the Debtor in the
bankruptcy court on November 16, 2022 — nearly three months after Plaintiff filed the present

> The First Amended Complaint (ECF No. 11), filed on November 10, 2022,
includes claims in Plaintiff's own name for his benefit and for the benefit of his
bankruptcy estate.

(5:22CV 1496)
case and nearly a month after Defendants’ Motion to Dismiss (ECF No. 8) was filed. See ECF
No. 24 in Case No. 20-52096-amk.’ Plaintiff argues that the actions he has taken since the filing
of Defendants’ Motion to Dismiss demonstrate a lack of bad faith and remedy his prior
concealment as a Chapter 13 debtor. See Opposition to Motion (ECF No. 24) at PageID #: 197,
205. In support, Plaintiff points to his own declaration, but does not state when he “took action
to notify [his] bankruptcy attorney” or that he made any disclosure to the Chapter 13 Trustee
prior to the filing of ECF No. 8:
4. Prior to the filing of my Chapter 13 bankruptcy petition, I was not
aware of the existence of possible violations of federal and Ohio wage law from
my time working for Defendants.
5. Once I learned that I may be owed unpaid overtime wages by
Defendants, I took action to notify my bankruptcy attorney of the existence of
these federal and related Ohio wage law claims.
ECF No. 24-1 at PageID #: 212. But merely allowing a bankruptcy petitioner to avoid judicial
estoppel by correcting omissions after an opposing party notifies them of the same “ ‘would
encourage gamesmanship’ and defeat the purpose of the doctrine.” Newman v. Univ. of Dayton,
751 Fed. Appx. 809, 815 (6th Cir. 2018) (quoting White, 617 F.3d 481). Moreover, Plaintiff
became aware that he possessed these overtime compensation claims prior to the filing of this
action and prior to the filing of Defendant’s Motion to Dismiss (ECF No. 8). And yet, as is
evident from the bankruptcy court’s docket, Plaintiff made no attempt to amend his schedules or

> On January 23, 2023, the Joint Motion and Application was granted. See ECF
No. 29 in Case No. 20-52096-amk. On January 20, 2023, the Chapter 13 Trustee filed an
Amended Motion to Dismiss Due to Failure of Debtor to Make Plan Payments (ECF No.
28 in Case No. 20-52096-amk). The Amended Motion to Dismiss was granted at a
hearing held on February 16, 2023.

(5:22CV 1496)
plan or alert the bankruptcy court to the existence of these claims prior to November 16, 2022.
The Sixth Circuit reaffirmed in Stan/ey that a Chapter 13 debtor’s motive to conceal claims is
presumed. 51 F.4th at 219; see also White, 617 F.3d at 479; Lewis v. Weyerhaeuser Co., 141
Fed.Appx. 420, 426 (6th Cir. 2005) (“It is always in a Chapter 13 petitioner’s interest to
minimize income and assets”).
Plaintiff's post hoc actions do not indicate good faith and are not enough to save this
matter from dismissal under applicable Sixth Circuit precedent. It is not just the efforts that a
debtor takes to correct an omission but the “timing” of those efforts that is important. Stanley, 51
F.4th at 221 (citing White, 617 F.3d at 480). “Consequently, efforts to correct an omission that
came before the Defendants filed their motion to dismiss are more important than efforts that
came after the Defendants filed their motion to dismiss.” White, 617 F.3d at 480. Like the
efforts taken by the plaintiffs in Stanley and White, Plaintiff's “late, perfunctory disclosure does
not demonstrate an absence of bad faith.” Stanley, 51 F.4th at 221.
B.
Plaintiff's repleading of his overtime compensation claims in the First Amended
Complaint (ECF No. 11) as also being for the benefit of his bankruptcy estate does not shield the
claims from the application of judicial estoppel. See White, 617 F.3d 481 n. 10 (rejecting
dissent’s argument that the concealed claims should be preserved for the Chapter 13 estate).
Plaintiff cites Stephenson v. Malloy, 700 F.3d 265 (6th Cir. 2012), and Stevenson v. Haddad,
529 Fed.Appx. 522 (6th Cir. 2013), in support of his argument that judicial estoppel cannot be
maintained against a bankruptcy Trustee. See ECF No. 24 at PageID #: 206-208. Stephenson

(5:22CV 1496)
and Stevenson, however, are distinguishable from the case at bar. First, both cases concern
Chapter 7 Trustees who were actually a plaintiff in the action. Whereas, the claims in ECF No.
11 are in a Chapter 13 debtor’s own name for his benefit and for the benefit of his bankruptcy
estate. Second, in Stephenson, the Sixth Circuit relied heavily on the substantial evidence
demonstrating a lack of bad faith. 700 F.3d at 269, 275. Plaintiff, however, has not alleged in
ECF No. 11 or his Declaration (ECF No. 24-1) that he made any disclosure of his overtime
compensation claims to the Chapter 13 Trustee prior to the filing of Defendant’s Motion to
Dismiss (ECF No. 8).
Other courts have distinguished Stephenson and imposed judicial estoppel on similar
facts to those in the present case. In Thompson v. Bruister and Assoc., Inc., No. 3:07-00412,
2013 WL 4507734, at *3 (M.D. Tenn. Aug. 23, 2013), the district court entered summary
judgment against plaintiff based on judicial estoppel even over the plaintiff's request that the
court wait to interpose the Chapter 13 Trustee as plaintiff. In Amato v. Maggiano’s Holding
Corp., No. 20-cv-12007, 2022 WL 406314, *4-5 (E.D. Mich. Feb. 4, 2022), the district court
distinguished Stephenson, cited Thompson, and applied judicial estoppel against a Chapter 13
debtor.
II.
Viewing Plaintiff's probative evidence and all reasonable inferences drawn therefrom in
the light most favorable to Plaintiff, the Court concludes that there is no genuine issue of material
fact and the movant is entitled to a judgment on the basis of judicial estoppel as a matter of law.
For the foregoing reasons, Defendants’ Motion to Dismiss (ECF No. 14), converted to a motion

(5:22CV1496)
for summary judgment, is granted. Final judgment will be entered in favor of Defendants and
against Plaintiff on the First Amended Complaint (ECF No. 11).

IT IS SO ORDERED.
March 31, 2023 /s/ Benita Y. Pearson
Date Benita Y. Pearson
United States District Judge

7

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10371948. Public record. Not legal advice.