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Metrou v. M.A. Mortenson Co.

United States Court of Appeals, Seventh Circuit

March 23, 2015

PETER METROU, Trustee of the Bankruptcy Estate of David Matichak, Plaintiff-Appellant,
v.
M.A. MORTENSON COMPANY and SCHUFF STEEL COMPANY, Defendants-Appellees

Submitted: March 2, 2015.

Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 11 C 9187 -- George M. Marovich, Judge.

For PETER METROU, as trustee for the bankruptcy estate of DAVID MATICHAK, Petitioner: Thomas A. Kelliher, Attorney, Horwitz Horwitz & Associates, Chicago, IL.

For M.A. MORTENSON COMPANY, individually, Respondent: Katherine Amelotte Jones, Attorney, doing business as: MORTENSON CONSTRUCTION Christensen & Ehret, Chicago, IL.

For Schuff Steel Company, Respondent: Christopher Cano, Attorney, Robert J. Franco II, Attorney, Franco & Moroney LLC, Chicago, IL.

Before FLAUM, EASTERBROOK, and WILLIAMS, Circuit Judges.

OPINION

Page 358

Easterbrook, Circuit Judge.

David Matichak was injured at work in August 2009 and filed a workers' compensation claim. Matichak and his wife filed a bankruptcy petition under Chapter 7 in September 2010; he disclosed the workers' compensation claim on his schedule of assets and valued it at $7,500. The bankruptcy court discharged the Matichaks' debts that December.

About a year after the discharge, Matichak filed a tort suit against two firms that, he maintained, had contributed to his injury. The suit sought substantial damages. Defendants asked the district judge for summary judgment, observing that Matichak had not listed any tort claim on his schedule of assets in the bankruptcy. That omission bars Matichak from prosecuting the suit, for the claim belongs to the Trustee while the bankruptcy case is open. See, e.g., Biesek v. Soo Line R.R., 440 F.3d 410 (7th Cir. 2006). We added in Cannon-Stokes v. Potter, 453 F.3d 446 (7th Cir. 2006), that a debtor is judicially estopped from litigating after the bankruptcy ends; having told the bankruptcy court implicitly that any tort claim had no value, and having received a discharge in response, the debtor is estopped from contending in a later suit that the claim is valuable. See also, e.g., Spaine v. Community Contacts, Inc., 756 F.3d 542 (7th Cir. 2014).

In response to the defense motion, Matichak notified the Trustee, who reopened the bankruptcy and moved to replace Matichak as the plaintiff in the tort suit. This is the approach we had contemplated in Biesek as the appropriate way to deal with a legal asset omitted from bankruptcy schedules. The district court allowed the substitution but then ruled, in response to a further motion by the defendants, that the Trustee's recovery could not exceed the value of the debts that had not been paid in 2010. In other words, the district judge concluded that, although Matichak's

Page 359

creditors may benefit from the tort suit, Matichak himself cannot.

The Trustee asked the district judge to certify that ruling for an interlocutory appeal under 28 U.S.C. ยง 1292(b). The judge did so, but the initial order omitted the findings required by that statute. (Section 1292(b) permits an appeal only if the district judge finds, " in writing", that the " order involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation" .) In response to a reminder, the judge entered a proper certification. Within ten days the Trustee filed a motion asking for our permission to appeal. Defendants maintain that the request is jurisdictionally late, but Fed. R. App. P. 5(a)(3) provides that, when a ...


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