Wieburg v. GTE Southwest Inc, et al

United States Court of Appeals
Fifth Circuit
F I L E D
June 2, 2003
Charles R. Fulbruge III
Clerk
In the
United States Court of Appeals
for the Fifth Circuit
_______________
m 02-11217
Summary Calendar
_______________
JOELINE WIEBURG,
Plaintiff-Appellant,
HARVEY MORTON,
TRUSTEE FOR RICHARD CARL WIEBURG AND JOELINE JOYCE WIEBURG,
Movant-Appellant
VERSUS
GTE SOUTHWEST INCORPORATED,
doing business as GTE Texas/New Mexico;
AND
GTE SERVICE CORPORATION,
Defendants-Appellees.
_________________________
Appeals from the United States District Court
for the Northern District of Texas
m 3:98-CV-2057-R
_________________________

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Before HIGGINBOTHAM, SMITH, and
CLEMENT, Circuit Judges.
PER CURIAM:*
Joeline Wieburg appeals the dismissal, for
failure to name the real party in interest, of her
employment discrimination suit against GTE
Southwest (“GTE”). See FED. R. CIV. P.
17(a). We review a dismissal under rule 17(a)
for abuse of discretion. Wieburg v. GTE
Southwest, Inc., 272 F.3d 302, 308 (5th Cir.
2001). Finding no abuse of discretion, we
affirm.1
I.
This case is before us for the second time.
In the first appeal, we extensively stated the
facts, id. at 303-05, which we now review
briefly.
GTE fired Wieburg in 1996, and she filed
for bankruptcy a few months later. She re-
ceived a discharge from the bankruptcy court
in early 1997. Three weeks later, she filed a
charge of discrimination against GTE with the
Equal Employment Opportunity Commission.
She sued GTE in August 1998.
During her deposition in September 1999,
GTE learned of Wieburg’s bankruptcy and
that she had not disclosed her employment
discrimination claims to the trustee. GTE no-
tified the trustee and moved t o dismiss Wie-
burg’s complaint, arguing that the claim be-
longed to the bankruptcy estate and therefore
that the trustee was the real party in interest.
The district court stayed the motion pend-
ing determination by the bankruptcy court of
who owned the claims. Wieburg and the trus-
tee entered a settlement agreement in January
2000 stating that the claim belonged to the es-
tate but that the trustee would retain Wie-
burg’s counsel, who would prosecute this ac-
tion in Wieburg’s name.
In April 2000, GTE supplemented its mo-
tion to dismiss, arguing that Wieburg should
join or substitute the trustee, otherwise her suit
should be dismissed. In May 2000, the district
court consulted with Wieburg’s counsel, who
agreed to submit proof that the trustee had
agreed to be bound by any judgment. Yet,
Wieburg days later filed her response to
GTE’s motion to dismiss, arguing that she
properly could prosecute the suit without sub-
stitution, joinder, or ratification of the trustee.
The court shortly thereafter granted GTE’s
motion to dismiss a few days later.
We affirmed in most respects. We agreed
that the trustee was the real party in interest.
Id. at 305-06. Furthermore, we held that the
settlement agreement did “not authorize Wie-
burg to pursue the discrimination claims solely
in her own name.” Id. at 307. We held, how-
ever, that “it was an abuse of discretion for the
district court to dismiss the action without
explaining why the less drastic alternatives of
either allowing an opportunity for ratification
by the [t]rustee, or joinder of the [t]rustee,
were [sic] inappropriate.” Id at 309. We
therefore vacated the judgment and remanded
so the court could explain its reasons for the
dismissal. Id.
* Pursuant to 5TH CIR. R. 47.5, the court has
determined that this opinion should not be pub-
lished and is not precedent except under the limited
circumstances set forth in 5TH CIR. R. 47.5.4.
1 Once again, “[t]he [t]rustee was not a party in
district court and has not sought to intervene in this
appeal. Accordingly, the [t]rustee’s appeal must
be dismissed.” Wieburg, 272 F.3d at 305.

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In so doing, we noted that
the district court did not address wheth-
er Wieburg had a reasonable time after
GTE’s objection during which to obtain
joinder, ratification, or substitution of
the [t]rustee, or whether her decision to
pursue the action in her own name was
the result of an understandable mistake.
More importantly, it is unclear whether
the district court considered the impact
of the dismissal of Wieburg’s creditors,
who are owed approximately $40,000.
Id. at 308-09. On remand, the district court
addressed all three of these questions at length,
finding that Wieburg’s prosecution of this suit
in her own name did not result from an honest
mistake; that she had a reasonable time after
GTE’s objection to obtain joinder, ratification,
or substitution of the trustee; and that dis-
missal would not seriously harm her creditors.
The court therefore dismissed the suit again.
II.
“Every action shall be prosecuted in the
name of the real party in interest. . . . No
action shall be dismissed on th[is] ground . . .
until a reasonable time has been allowed after
objection for ratification of commencement of
the action by, or joinder or substitution of, the
real party in interest[.]” FED. R. CIV. P. 17(a).
This last sentence is “applicable only when the
plaintiff brought the action in her own name as
the result of an understandable mistake,” as
opposed to calculation or neglect. Wieburg,
272 F.3d at 308. To avoid dismissal, there-
fore, a plaintiff who is not the real party in
interest must show, first, that he sued in his
own name based on an understandable mistake
and, second, that he did not have a reasonable
time to correct the pleading deficiency. See id.
at 308.2
We vacated and remanded the court’s first
dismissal not because we necessarily
disagreed, but because the court made no
factual findings for us to review for a possible
abuse of discretion. Now that we have the
court ’s reasons, we conclude that it did not
abuse its discretion by dismissing the suit.
A.
We assume arguendo that Wieburg sued in
her own name based on an understandable
mistake and address whether she had a
reasonable time to correct the pleading
deficiency. The court found that she had
seven months to satisfy rule 17(a), a
reasonable time of which she did not take
advantage. We agree.
GTE objected to Wieburg’s complaint in
October 1999, and the court dismissed the suit
in May 2000. Throughout this seven-month
period, Wieburg repeatedly failed to obtain
ratification, joinder, or substitution of the trus-
tee. At any point, she easily could have
corrected the pleading deficiency; instead, she
went to great lengths to remain the sole
plaintiff. She sued the trustee in bankruptcy
court, asserting that the claims belonged to
her. She sought and received a stay of the
motion to dismiss from the district court. She
entered an artful settlement agreement with the
trustee that only appeared to bind him to any
judgment. When prodded by the court, her
counsel agreed to submit a formal ratification
2 6A CHARLES A. WRIGHT ET AL., FEDERAL
PRACTICE AND PROCEDURE § 1555, at 415-16 (2d
ed. 1990) (explaining that only plaintiffs whose
pleading error resulted from understandable mis-
take should receive a reasonable time to correct the
error).

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from the trustee, but instead submitted a brief
arguing that Wieburg did not need to obtain
substitution, joinder, or ratification.
“What constitutes a reasonable time is a
matter of judicial discretion and will depend
upon the facts of each case.” 6A CHARLES A.
WRIGHT ET AL., FEDERAL PRACTICE AND PRO-
CEDURE § 1555, at 417 (2d ed. 1990). Seven
months is more than reasonable, especially af-
ter Wieburg fully demonstrated her intent not
to surrender control of this suit. There is no
abuse of discretion.
B.
We also requested that the court “consid-
er[ ] the impact of the dismissal on Wieburg’s
creditors.” Wieburg, 272 F.3d at 309. The
court found that a dismissal would have only a
negligible effect on her creditors, because any
recovery was highly speculative at this early
stage, and the dismissal would not alter their
position, i.e., t heir unpaid debt would remain
unpaid.
We agree that the dismissal has at most a
negligible effect on Wieburg’s creditors. As
the court found, recovery was highly
speculative. The court had not even ruled on
GTE’s summary judgment motion yet, the
crucible for most employment discrimination
suits. Any recovery would be spread among
eight creditors, large corporations whose
financial condition hardly rises or falls with
their small share of Wieburg’s debts. Finally,
these creditors could have protected their
interests more effectively in bankruptcy court
after that court re-opened Wieburg’s case in
late 1999. In particular, they could have
encouraged the trustee, their legal
representative, not to enter the flawed
settlement agreement; failing that, they could
have challenged the agreement. There is no
abuse of discretion.
AFFIRMED.

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