In re: KELLY ANN LEWIS v. Kelly Ann Lewis

NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
File Name: 10a0416n.06
No. 09-1777
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
In re: KELLY ANN LEWIS,
Debtor,
__________________
STUART A. GOLD, Chapter 7 Trustee,
Plaintiff-Appellant,
v.
KELLY ANN LEWIS,
Defendant-Appellee.
/
On appeal from the United States
District Court for the Eastern District
of Michigan
BEFORE: MARTIN, RYAN, and KETHLEDGE, Circuit Judges.
RYAN, Circuit Judge. The defendant, Kelly Ann Lewis, is a debtor who filed a
voluntary Chapter 7 bankruptcy petition. The plaintiff, Stuart A. Gold, is the Chapter 7
Trustee for the bankruptcy estate and is contesting Lewis’s claim that her interest in a Ford
Motor Company employee buyout plan is exempt from bankruptcy proceedings under 11
U.S.C. § 522(d)(11)(E). After both the bankruptcy court and the federal district court ruled
in favor of Lewis, the Trustee appealed to this court. We will affirm the bankruptcy court’s
judgment for Lewis.

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I.
Lewis is a former Ford Motor Company employee and member of the United Auto
Workers union. In September 2006, Ford and the union agreed to eight different buyout
options for Ford-UAW workers who wished to terminate their employment at Ford. One
of the options was the Educational Opportunity Program (EDOPP), under which a
participant would receive, for up to four years, tuition reimbursement of up to $15,000 per
year, health care benefits, and an annual living expense stipend equal to 50% of the
participant’s annualized straight-time hourly wage at the time of termination after leaving
Ford. If an EDOPP participant decided to leave the program at any time, the participant
could choose to receive a payment equal to the amount offered under the Special
Termination of Employment Program (STEP), minus the cost incurred by Ford for the
participant’s enrollment in the EDOPP. The amount offered under the STEP is $100,000.
On November 27, 2006, Lewis signed an “Application and Waiver Agreement,” in
which she agreed to the terms and conditions of the EDOPP and voluntarily terminated her
employment with Ford, thereby waiving all her rights to future earnings, pension benefits,
unemployment compensation, and UAW member benefits. The written agreement also
specifically stated that Lewis was physically able to work and suffered from no disabilities
precluding her from her earlier employment.
On March 19, 2008, Lewis filed a voluntary Chapter 7 bankruptcy petition. By that
time, she had received $11,201.55 in tuition, books, and fees under the EDOPP. She had
also received one stipend payment of $27,622.40. Following the filing of her bankruptcy
petition, she received a second stipend payment of $27,622.40. In addition, Lewis may be

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entitled to a final payment under the STEP if her participation in the EDOPP was
terminated, but that question is not before us.
After Lewis claimed that her interest in the EDOPP was exempt from the bankruptcy
proceedings and the Trustee filed objections to Lewis’s exemption claim, the bankruptcy
court held hearings on the objections. On November 7, 2008, the bankruptcy court ruled
that Lewis’s interest in the EDOPP was exempt under 11 U.S.C. § 522(d)(11)(E). The
Trustee appealed the bankruptcy court’s decision to the federal district court.
On May 21, 2009, the district court issued an order affirming the bankruptcy court’s
judgment. The Trustee appealed the district court’s decision to this court.
II.
We review a bankruptcy court’s legal conclusions under a de novo standard of
review. Parker v. Goodman (In re Parker), 499 F.3d 616, 620 (6th Cir. 2007). Moreover,
this court is not “bound by the district court’s legal determinations,” but directly reviews the
decision of the bankruptcy court. Stamper v. United States (In re Gardner), 360 F.3d 551,
557 (6th Cir. 2004).
III.
The bankruptcy court ruled that Lewis’s interest in the EDOPP is exempt under 11
U.S.C. § 522(d)(11)(E), which states the following:
(d) The following property may be exempted . . . :
. . . .
(11) The debtor's right to receive, or property that is traceable to–
. . . .

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(E) a payment in compensation of loss of future
earnings of the debtor or an individual of whom the debtor is or
was a dependent, to the extent reasonably necessary for the
support of the debtor and any dependent of the debtor.
11 U.S.C. § 522(d)(11)(E).
When interpreting a statute, we begin by considering the statute’s plain language
and we must enforce the statute “‘according to its terms.’” United States v. Ron Pair
Enters., Inc., 489 U.S. 235, 241 (1989) (quoting Caminetti v. United States, 242 U.S. 470,
485 (1917)). “The court must look beyond the language of the statute, however, when the
text is ambiguous or when, although the statute is facially clear, a literal interpretation
would lead to internal inconsistencies, an absurd result, or an interpretation inconsistent
with the intent of Congress.” Vergos v. Gregg’s Enters., Inc., 159 F.3d 989, 990 (6th Cir.
1998).
The Trustee argues that the bankruptcy court incorrectly ruled that Lewis’s interest
in the EDOPP is “a payment in compensation of loss of future earnings.” 11 U.S.C. §
522(d)(11)(E). The Trustee argues that the statute is ambiguous because “loss of future
earnings” is a legal term used in tort cases necessarily involving a loss of earning capacity
due to a bodily injury. The Trustee urges the court to consider the legislative history of the
statute.
We find that the language of the statute is clear and unambiguous. Subparagraph
(d)(11) lists a total of five types of benefits which are exempt: (A) reparation benefits; (B)
death benefits; (C) life insurance; (D) a payment “on account of personal bodily injury”; and
(E) “a payment in compensation of loss of future earnings.” 11 U.S.C. § 522(d)(11). In the
statute, the word “or” clearly separates subsection (E) from subsection (D), which refers

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to a bodily injury. Based on the unambiguous language of the statute, and contrary to the
interpretation of the Trustee, we conclude that the legislature has not tied the loss of future
earnings to a bodily injury. The statute’s plain language is clear and leads to no internal
inconsistencies. Because the statute is clear and unambiguous, we therefore need not
“look beyond the language of the statute” to the statute’s legislative history. Vergos, 159
F.3d at 990.
By agreeing to the terms and conditions of the EDOPP, Lewis received a payment
in exchange for waiving her right to all future earnings with Ford. This was a payment in
compensation of loss of future earnings. Consequently, Lewis’s interest in the EDOPP is
exempt from bankruptcy proceedings pursuant to 11 U.S.C. § 522(d)(11)(E).
IV.
For the reasons above, we AFFIRM the judgment of the bankruptcy court.

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