In the practice of law, judicial estoppel (also known as estoppel by inconsistent positions) is an estoppel

that precludes a party from taking a position in a case that is contrary to a position it has taken in earlier
legal proceedings. Although, in the United States, it is only a part of common law and therefore not
sharply defined, it is generally agreed that it can only be cited if the party in question successfully
maintained its position in the earlier proceedings and benefited from it.

Judicial estoppel is a doctrine that may apply in matters involving closed bankruptcies, wherein the
former debtor attempts to lay claim to an asset that was not disclosed on the bankruptcy schedules. In
an early U.S. articulation of the doctrine, the United States Supreme Court, in First National Bank of
Jacksboro v. Lasater, 196 U.S. 115 (1905), held at 119:

"It cannot be that a bankrupt, by omitting to schedule and withholding from his trustee all knowledge of
certain property, can, after his estate in bankruptcy has been finally closed up, immediately thereafter
assert title to the property on the ground that the trustee had never taken any action in respect to it. If
the claim was of value (as certainly this claim was, according to the judgment below), it was something
to which the creditors were entitled, and this bankrupt could not, by withholding knowledge of its
existence, obtain a release from his debts and still assert title to the property."

The principle was used in 2001 by a unanimous U.S. Supreme Court in the Piscataqua River border
dispute, in which New Hampshire argued that the Portsmouth Naval Shipyard was in New Hampshire
after having previously joined a consent decree that agreed on a border that would put it in Maine.

Judicial estoppel is “an equitable doctrine designed to protect the integrity of the
judicial system and prohibits a litigant from taking inconsistent positions in
litigation according to the exigencies of the moment. In the Eleventh Circuit,
courts consider two factors in the application of judicial estoppel to a particular
case--(1) whether the allegedly inconsistent positions were made under oath in a
prior proceeding, and (2) whether such inconsistencies were calculated to make
a mockery of the judicial system.” Kipperman v. Onex Corp., 411 B.R. 805 (N.D.
Ga. 2009)

California Law on Judicial Estoppel

February 2007

The equitable doctrine of judicial estoppel can be invoked to prevent a party from taking a position
contrary to one the party advanced in prior litigation. The purpose of the doctrine has been stated in
multiple, but substantially similar, forms: to "protect the integrity of the judicial process," Jackson v.
County of Los Angeles; to "protect against a litigant playing fast and loose with the courts"; and to
implement "general considerations of the orderly administration of justice and regard for the dignity of
judicial proceedings," Prilliman v. United Air Lines, Inc.
While the doctrine of judicial estoppel has long been recognized in California, as of 1998 the California
courts had not established a clear set of principles for applying it (i.e., a standard with well-defined
elements). Instead, the courts had merely recited certain observations about the doctrine, such as
that "one to whom two inconsistent courses of action are open and who elects to pursue one of them
is afterward precluded from pursuing the other," that the "seemingly conflicting positions must be
clearly inconsistent so that the one necessarily excludes the other," and that the doctrine "cannot be
invoked where the position first assumed was taken as a result of ignorance or mistake."

The uncertainty disappeared in 1998 with the publication of Jackson v. County of Los Angeles by the
Second District Court of Appeal, which held that the doctrine of judicial estoppel "should apply"
whenever:

(1) the same party has taken two positions; (2) the positions were taken in judicial or quasi-judicial
administrative proceedings; (3) the party was successful in asserting the first position (i.e., the
tribunal adopted the position or accepted it as true); (4) the two positions are totally inconsistent;
and (5) the first position was not taken as a result of ignorance, fraud, or mistake.

This precise recitation of the elements of judicial estoppel was later adopted by another court of
appeal and ultimately by the California Supreme Court in two separate decisions.

For those with litigation pending in California (or involving California substantive law), there are at
least two aspects of judicial estoppel law that bear mention:

The Meaning of "Adopted" or "Accepted." When the earlier litigation resulted in, say, a jury
verdict specifically adopting the argument advanced, element three is easily satisfied. But what about
litigation resulting instead in a settlement or stipulated judgment?

The law of some federal circuits, such as the D.C. Circuit, Second Circuit, and Sixth Circuit, appears
to hold that private settlements will rarely, if ever, satisfy the "success" requirement. However, more
recent decisions from other circuits (and even from the Sixth Circuit itself) suggest
that Konstantinidis, Bates, Edwards do not state the prevailing view of the courts, and even if their
holdings did technically state the majority position, they should be limited to their particular facts. For
example, after Edwards was decided, the Sixth Circuit held, distinguishing Edwards, that a
settlement did satisfy the "success" element of judicial estoppel where the settlement was approved
by a probate court, Warda v. Commissioner of Internal Revenue, 15 F.3d 533, 538-39 (6th Cir.
1994), as did a compromise between a debtor and his creditors approved by the bankruptcy
court. See Reynolds v. Commissioner of Internal Revenue, 861 F.2d 469, 473 (6th Cir. 1988). And
the Seventh Circuit, when faced with an argument that success requires "the existence of a judicial
opinion adopting the litigant's positions," flatly rejected the contention, holding that parties "who
triumph by inducing their opponents to surrender" in the form of a settlement "have 'prevailed' as
surely as person who induce the judge to grant summary judgment." Kale v. Obuchowski, 985 F.2d
360, 362 (7th Cir. 1993).

The California Supreme Court has not yet spoken on the issue. But the California courts of appeal
have ruled that the following acts constitute adoption or acceptance: a stipulation entered into by a
party at trial, see City of Lodi v. Randtron, 118 Cal. App. 4th 337, 351 n.18 (2004), a stipulation
signed by a party which a workers' compensation judge adopted in making an award, Drain v. Betz
Laboratories, Inc., 69 Cal. App. 4th 950, 958-59 (1999), and a debtor's intentional failure in a
bankruptcy proceeding to disclose all of its interests and property rights. See International Engine
Parts, Inc. v. Feddersen & Co., 66 Cal. App. 4th 345, 351-52 (1998).

The Ninth Circuit — whose pronouncements a California court would presumably view most favorably
— has embraced a more straightforward position: In answering the question "whether obtaining a
favorable settlement is equivalent to winning a judgment for purposes of applying judicial estoppel,"
it has held, without equivocation, that "a favorable settlement constitutes the success
required." Rissetto v. Plumbers & Steamfitters Local 343, 94 F.3d 597, 604-605 (9th Cir. 1996). The
Ninth Circuit analogized the situation to the award of attorneys' fees in civil rights cases to "prevailing
parties," observing that a party that obtains a favorable consent decree is generally considered a
prevailing party for purposes of the award of fees. Id. at 605.

While the California Supreme Court may not ultimately adopt the categorical position announced by
the Ninth Circuit in Rissetto — that settlement is always equivalent to winning a judgment — the
prevailing trend is to embrace settlement, and especially settlements approved in some way by a
tribunal, as a form of "adoption" or "acceptance" such that judicial estoppel applies.

The Meaning of "Totally Inconsistent." The mere fact that a position taken in the current
litigation is somewhat inconsistent with, or merely in tension with, a position taken in the prior
litigation, is insufficient. Rather, to satisfy the inconsistency element, a party must show that the two
positions taken are "totally inconsistent," MW Erectors, 36 Cal. 4th at 422, which at least one
California court has defined as meaning "logically inconsistent." Browne v. Turner Const. Co., 127
Cal. App. 4th 1334, 1349 (2005). Looking at published decisions, courts tend to interpret the term
"totally inconsistent" somewhat narrowly, limiting its application to situations in which a party has
argued that a certain fact or rule of law is true, and then switched course and in a separate litigation,
"reverse[d]" its position. Furia v. Helm, 111 Cal. App. 4th 945, 958-59 (2003).

For example, in Scripps Clinic, the party being estopped had argued that the clinic's termination of
care "violates the professional duty of care" but then argued, with respect to a different issue, that
the termination was an "administrative," and not a "professional" decision. Scripps Clinic, 134 Cal.
App. 4th at 943.

In Jackson, the police officer plaintiff had sought and obtained a finding on a workers' compensation
claim of "permanent disability," but then argued in a subsequent Americans With Disabilities Act suit
that he was a "qualified individual with a disability," which necessarily required that be able to
"perform the essential functions of the employment position" (i.e., not be permanently disabled). 60
Cal. App. 4th at 179; see also Drain, 69 Cal. App. 4th at 958 (same factual scenario, but subsequent
claim brought under the California Fair Employment and Housing Act).

And in Furia, the plaintiff, a general contractor hired to remodel a residence who become embroiled in
a dispute with the owners, sued an attorney retained to mediate the dispute, on the basis that he had
relied upon the mediator's legal advice and abandoned the remodeling project, causing plaintiff to
incur damages. Yet, in cross-claims and in disciplinary proceedings brought by the Contractors' State
License Board, plaintiff "denied that he abandoned the project." 111 Cal. App. 4th at 957. Because
the "capstone" of plaintiff's damage claim was that he withdrew from the project in "reliance" on the
mediator's advice — exactly the opposite of what he had argued in other litigation or regulatory
forums — the application of judicial estoppel precluded him from showing reliance/causation, and
thus prevailing on his claim for damages. Id. at 958.

Lawyer Contact

For further information, please contact your principal Firm representative or the lawyer listed below.
General e-mail messages may be sent using our "Contact Us" form, which can be found at
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Stephen M. Silver
1.949.553.7528
smsilver@jonesday.com

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Judicial Estoppel Defined
While stipulating that the following factors do not set "inflexible prerequisites or an exhaustive
formula for determining the applicability of judicial estoppel," the US Supreme Court laid out the
elements of judicial estoppel in the 2001 case of New Hampshire v. Maine, 532 U.S. 742. To cite
Justice Ginsberg's description:

First, a party's later position must be clearly inconsistent with its earlier position.

Second, courts regularly inquire whether the party has succeeded in persuading
a court to accept that party's earlier position, so that judicial acceptance of an
inconsistent position in a later proceeding would create the perception that either
the first or second court was misled.

Third, courts ask whether the party seeking to assert an inconsistent position
would derive an unfair advantage or impose an unfair detriment on an opposing
party if not estopped.
Justice Ginsberg further noted that without success in a prior proceeding, "a party's inconsistent
position introduces no risk of inconsistent court determinations" and "poses little threat to judicial
integrity."
The Supreme Court emphasized that "it may be appropriate to resist application of the doctrine of
judicial estoppel when a party's prior position was based on inadvertence or mistake." Thus, judicial
estoppel is operative "in situations involving intentional contradictions, not simple error or
inadvertence." Burnes v. Pemco Aeroplex, Inc.(Emphasis added.)
Generally, courts may infer intent from the record if a person has knowledge and motive at the time
of nondisclosure. Whether judicial estoppel applies at all is a discretionary matter for a trial judge to
decide. Consequently, one may find a variety of factual scenarios with hints of how courts decide
whether an inconsistency is intentional or inadvertent.

The doctrine of judicial estoppel—alive, well, expanding, and

still devastating
The doctrine of “judicial estoppel” is alive and fully applicable to maritime personal injury claims. In
fact, recent case law suggests that the doctrine is expanding somewhat. Judicial estoppel can have a
devastating effect on a plaintiff’s damages calculation and can sometimes be a complete bar to a
lawsuit, leaving a longshoreman or Jones Act seaman with little more than an order of dismissal in
their pocket. It is for these reasons that Blank Rome’s maritime litigation team regularly dives deeply
into a plaintiff’s past for records containing contradictory statements that could limit or sink a
pending claim.
Judicial Estoppel: The Basics
The doctrine of judicial estoppel serves to prevent a litigant from taking a position or asserting a
claim in a court proceeding that is directly contrary to a statement made or position taken in a
previous proceeding. The authority to apply the doctrine stems from the court’s inherent equitable
authority to sanction malfeasance. The stated purpose of judicial estoppel is to protect the integrity of
the court process, but the doctrine is also applied to prevent the commission of a fraud upon a
defendant. Generally, judicial estoppel bars a litigant from asserting a position that is inconsistent
with one he or she previously took before a court, but prior inconsistent statements made by the
litigant in nonjudicial proceedings can give rise to judicial estoppel, as well.
Most federal circuits have a test, framework, or rubric for the doctrine’s application. The law in the
Third Circuit, for example, sets out a typical test consisting of three requirements. First, the party
being estopped must have taken two positions or made two statements that are irreconcilably
inconsistent. Second, judicial estoppel should be applied only if a party changed or adapted his or her
position in bad faith or with the intent “to play fast and loose with the court.” Third, the judicial
estoppel remedy must be “tailored to address the harm identified” and applied only where a lesser
sanction would not adequately redress the harm done by the litigant’s misconduct.
Judicial Estoppel: A Broader Application then Commonly Understood
Elements #2 and 3 of the Third Circuit test are fairly standard. Courts regularly require a showing of
some conduct suggestive of bad faith or improper motive with respect to the inconsistent statements.
And judicial estoppel will usually be applied in a way that is narrowly tailored to address the
potential harm under the factual circumstances of the case. However, the requirement that a party
must have taken two irreconcilably inconsistent positions is loosely defined, giving the courts some
latitude in determining the types of statements and circumstances that qualify.
Courts have held, for example, that the timing of the inconsistent statements is not necessarily
determinative. Therefore, both statements need not have been made during the course of the same
pending lawsuit. Nor is it absolutely necessary for both statements to have been made in court
proceedings. For example, prior statements made to local, state, and federal agencies, or to insurance
companies, if sufficiently inconsistent with a later position being taken before a court, can give rise
to a judicial estoppel. The fact that the prior inconsistent statement was not actually made by the
plaintiff himself is not a problem either, if the statement was made at his/her direction or on his/her
behalf. For example, a statement made by the plaintiff’s physician that the plaintiff has authorized or
endorsed in some fashion (by behavior or practice) would qualify. Finally, it is not always necessary
to prove that the plaintiff actually obtained some sort of benefit from making the prior inconsistent
statement.
A Recent Blank Rome Judicial Estoppel Success
In defending a multi-million dollar claim, we recently convinced a federal district court judge in the
Third Circuit to apply judicial estoppel against a Jones Act seaman. In that matter, a tug boat captain
had filed a suit in which he alleged that an unseaworthy condition aboard his employer’s tugboat had
caused injuries to his shoulder and back that would permanently disable him from all future maritime
employment. During discovery, records were obtained from various sources pertaining to several
previous Jones Act suits that the plaintiff had filed over his career. In those files, we located a 19-
year old pretrial statement in which the plaintiff (via his counsel) had alleged that he had injured his
back so severely that he would never again work as a mariner. In deposition, the plaintiff admitted to
having settled that case for a significant sum.
We also obtained the plaintiff’s U.S. Coast Guard file, which contained copies of applications for
renewal of his license. Each of the license renewal applications was accompanied by a declaration
co-signed by the plaintiff and his family doctor to the effect that the plaintiff was currently physically
capable of performing the duties of a mariner. Notably, the plaintiff’s most recent renewal
application had been submitted ten months after the occurrence of the injury at issue in the current
lawsuit, at a time when he was submitting Unfit for Duty slips to, and collecting maintenance and
cure from, our client.
Armed with this evidence, we filed a motion for summary judgment asserting a two-pronged judicial
estoppel argument. We first argued that the plaintiff could not have experienced a maritime career-
ending injury twice. Because he had filed a statement with another federal court in 1993 claiming to
have been permanently disabled from maritime work, he should be barred from seeking a second
recovery for his future lost earnings. In the alternative, we argued that the declaration of medical
fitness most recently submitted to the Coast Guard was directly contradictory to the claim of
disability being made in his current Jones Act case, so he should be precluded from collecting
damages for any prospective lost earnings after the date of his Coast Guard declaration.
Though not willing to preclude the plaintiff’s entire claim based on the 19-year old pretrial statement
(due primarily to some potential ambiguity that would require consideration by a jury), the court did
apply judicial estoppel based upon the inconsistent medical declaration made to the Coast Guard. The
court found that the plaintiff was well aware of the inconsistency between his declaration to the
Coast Guard and his position in the lawsuit and had provided no reasonable explanation. Therefore, a
presumption of bad faith was appropriate and the imposition of judicial estoppel was necessary to
prevent the perpetration of a fraud upon our client by means of the lawsuit.
A Practical Tip for Defending Jones Act and LHWCA Claims
We recommend digging deep during discovery by requesting access to any type of records in which a
plaintiff may have made a statement about his physical or mental condition. Some areas to consider
are the files of attorneys involved in prior lawsuits, documents in the possession of state and/or
federal agencies that pertain to a plaintiff’s licensure, and insurance company files pertaining to
applications for coverage or claims for disability benefits. Those sources of information may contain
proof that a plaintiff made a statement or took a position that is contrary to a position being put
forward in his pending lawsuit. If a past contradictory statement made by or on behalf of a plaintiff
can be located via thorough, diligent, and creative discovery, it can be the basis of a strong motion
for the invocation of the doctrine of judicial estoppel.