Jaurdon v. Cricket Communications, Inc.

F I L E D
United States Court of Appeals
Tenth Circuit
PUBLISH
June 20, 2005
UNITED STATES COURT OF APPEALS
PATRICK FISHER
Clerk
TENTH CIRCUIT

RICO JAURDON; RICCI JETT,

Plaintiffs-Appellants,

v. No. 02-5127
(D.C. No. 01-CV-633-H)
CRICKET COMMUNICATIONS, (N.D. Okla.)
INC.,

Defendant-Appellee.

APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF THE NORTHERN DISTRICT OF OKLAHOMA
(D.C. No. 01-CV-633-H)

Submitted on the briefs:

Jana B. Leonard and Jason D. Leonard, Leonard & Associates, P.L.L.C.,
Oklahoma City, Oklahoma, for Plaintiffs-Appellants.

Jo Anne Deaton, Rhodes, Hieronymus, Jones, Tucker & Gable, P.L.L.C., Tulsa,
Oklahoma, for Defendant-Appellee.

Before SEYMOUR, McCONNELL, and TYMKOVICH, Circuit Judges.

McCONNELL, Circuit Judge.
 Plaintiffs-appellants filed their Title VII action in the district court

claiming race discrimination and retaliation in violation of 42 U.S.C. §§ 1981 and

1985. The district court dismissed all claims, holding that plaintiff Jaurdon’s

termination was not discriminatory and that plaintiff Jett’s claims failed because

defendant’s reasons for not promoting him were not pretextual and because

Mr. Jett’s evidence of retaliation was insufficient. Plaintiffs appealed.

While the appeal was pending, defendant-appellee Cricket Communications

and certain of its subsidiaries and other affiliated entities (Cricket) filed for

Chapter 11 protection. On April 15, 2003, this court abated the appeal pending

resolution of the bankruptcy proceeding. On December 1, 2004, after filing

several court-ordered status reports, Cricket filed its final report in which it stated

that its plan of reorganization had been approved by the bankruptcy court.

Cricket also argued that this appeal should be dismissed as discharged under the

Bankruptcy Code. Cricket stated that, “[t]o the best of [its] knowledge,

Appellants never submitted any notice of claim to the Bankruptcy Court and thus

Appellants’ claims have now been discharged by operation of law pursuant to the

Plan.” Appellee’s Final Report Regarding Status of Bankruptcy Proceedings and

Request for Dismissal of Appeal at 1.

On April 4, 2005, this court ordered Cricket to provide evidence that

appellants received the formal notice of the pertinent bankruptcy deadlines in

-2-
time for them to act appropriately (show cause order). Having received Cricket’s

response to this court’s show cause order as discussed below, we grant Cricket’s

request and dismiss this appeal. 1

The confirmation of a plan in a Chapter 11 bankruptcy discharges a

non-individual debtor, here Cricket, from pre-petition debt unless a creditor does

not receive formal notice of the bankruptcy. See 11 U.S.C. § 1141(d)(1)(A);

Dalton Dev. Project #1 v. Unsecured Creditors Comm. (In re Unioil), 948 F.2d

678, 683-84 (10th Cir. 1991). If appellants held claims against Cricket and

received proper notice, they are bound by the terms of the confirmed plan, and

this appeal is subject to dismissal because those claims have been extinguished

pursuant to the plan. The initial inquiry, therefore, is whether appellants had a

claim in Cricket’s bankruptcy.

The Bankruptcy Code defines a claim in pertinent part as a “right to

payment, whether or not such right is reduced to judgment, liquidated,

unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal,

equitable, secured, or unsecured.” 11 U.S.C. § 101(5)(A). In order to appreciate

the broad concept of “claim,” it is helpful to compare the newer, more expansive

1
After examining the briefs and appellate record, this panel has determined
unanimously to grant the parties’ request for a decision on the briefs without oral
argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore
ordered submitted without oral argument.

-3-
definition of claim contained in the Bankruptcy Code with the definition of claim

in the old Bankruptcy Act.

When Congress drafted the Bankruptcy Code in 1978, it
provided a far more inclusive definition of “claim” than had been
used under the superseded Bankruptcy Act of 1898, as amended. The
revised definition was intended to mark “a significant departure from
present law” by creating the “broadest possible definition” of claim.
The goal of Congress was to ensure that “all legal obligations of the
debtor, no matter how remote or contingent, will be able to be dealt
with in the bankruptcy case,” and permit the “broadest possible relief
in the bankruptcy court.”

Laura B. Bartell, Due Process for the Unknown Future Claim in Bankruptcy–Is
This Notice Really Necessary?, 78 Am. Bankr. L.J. 339, 340-41 (2004) (footnotes
citing legislative history omitted).

Despite the facial appeal of appellants’ argument that, because they lost in

the district court they were owed no money by Cricket, were not creditors, and

therefore did not need to file proofs of claim, the definition of “claim” in the

Bankruptcy Code is broad enough to encompass appellants’ case on appeal.

Because the definition of claim includes “right to payment, whether or not such

right is . . . contingent, [or] disputed,” 11 U.S.C. § 101(5)(A), it includes

appellants’ situation -- be it disputed by Cricket or contingent upon this court’s

decision on appeal. See Fogel v. Zell, 221 F.3d 955, 963-64 (7th Cir. 2000)

(analogizing to asbestos cases and allowing City of Denver to file late claim

based on purchase of defective sewer pipe that had not yet burst before deadline

for filing proofs of claim); United States v. LTV Corp. (In re Chateaugay Corp.),

-4-
944 F.2d 997, 1005 (2d Cir. 1991) (holding that unincurred CERCLA response

costs for pre-petition releases of hazardous waste were claims despite the fact that

EPA did not yet know the full extent of the removal costs and did not even know

the location of all the sites where waste might be located); see also Jones v.

Chemetron Corp., 212 F.3d 199, 209 (3d Cir. 2000) (holding that a child, unborn

at the time of the bankruptcy proceeding in which no representative had been

appointed to receive notice and represent future claimants, held a claim not

discharged by the confirmation order).

As referred to above and in response to Cricket’s request for dismissal of

this appeal, this court issued a show cause order dated April 4, 2005, directing

Cricket to provide evidence that appellants received the requisite formal notice of

the bankruptcy proceeding in time for them to file proofs of claim as required by

the law in this Circuit. See In re Unioil, 948 F.2d at 683-84. Cricket has

responded to the show cause order with adequate proof that the requisite formal

notice was sent to both of the appellants in a timely manner. Appellants do not

deny that they received the requisite notice. Therefore, the confirmation of

Cricket’s reorganization plan discharged appellants’ claims by operation of law.

See 11 U.S.C. § 1141 (d)(1)(A).

-5-
 Cricket’s motion for permission to file an out-of-time reply to appellants’

response to the request for dismissal of appeal is GRANTED.

This appeal is DISMISSED.

-6-