Lofton v. SP Plus Corp.
Opinion of the Court
ORDER
LaShawn Lofton was granted leave to proceed in forma pauperis (“IFP”) in this lawsuit. But when the district court learned that Lofton had failed to disclose several assets on her IFP application, the court concluded that she had committed a fraud on the court and dismissed the case with prejudice as a sanction. We conclude that the district court properly exercised its discretion, and thus we affirm the judgment.
When Lofton filed her federal complaint she sought to proceed IFP. In her sworn application she acknowledges receiving unemployment benefits but avers that she has no assets and no other source of funds. The district court granted Lofton pauper status, waived the filing fee, and later recruited counsel. Lofton’s lawyer filed an amended complaint raising several claims, including that former employer SP Plus Corporation fired her because of a disability, see 42 U.S.C. § 12188, and that her union, Teamsters Local Union No. 727, breached its duty of fair representation, see 29 U.S.C. § 159(A).
The district court dismissed the lawsuit with prejudice — -not explicitly under § 1915(e)(2)(A), as the defendants had requested — but apparently as a sanction for filing a fraudulent document with the court. The court disbelieved Lofton’s assertion of confusion in light of the documents she had filed in the bankruptcy case. Thus, the court concluded, Lofton had committed a fraud on the court that allowed her to avoid the filing fee and receive pro bono counsel.
Lofton argues on appeal that the district court abused its discretion by dismissing her case with prejudice as a sanction. She maintains that the omissions from her IFP application were inadvertent, and thus she did not intentionally deceive the court. Lofton explains that her medical conditions (high blood pressure, diabetes, and a history of strokes) impeded her ability to complete the IFP application, but this contention is waived because Lofton makes it for the first time on appeal. See Cnty. of McHenry v. Ins. Co. of the West, 438 F.3d 813, 819-20 (7th Cir. 2006).
Underlying the dismissal is the district court’s factual finding that Lofton intentionally falsified her IFP application, and we review that finding only for clear error. See Thomas v. Gen. Motors Acceptance Corp., 288 F.3d 305, 308 (7th Cir. 2002). The district court rejected Lofton’s assertion that she had misunderstood the questions on the IFP application. The application includes pointed questions about houses and cars, including the current value and equity held in those items. The question about real estate, in particular, makes plain that a home “with or without a mortgage” must be divulged. Lofton had disclosed her house, car, and fur coat on her bankruptcy schedules, and when she modified her Chapter 13 payment plan just two months before seeking pauper status, she also acknowledged receiving financial assistance from her family. And previously in 2009, during her divorce proceedings, Lofton had completed a similar financial affidavit and disclosed that she owned a house. The district court’s finding that Lofton lied on her IFP application is amply supported, and with that finding intact, we turn to whether the district court abused its discretion by dismissing the case with prejudice as a sanction.
Dismissal with prejudice is an appropriate sanction when a plaintiff tries to deceive the district court by falsifying an IFP application. Thomas, 288 F.3d at 306-07; Mathis v. New York Life Ins. Co., 133 F.3d 546, 547 (7th Cir. 1998). Proceeding in forma pauperis is a privilege, and courts depend on the plaintiffs honesty in assessing her ability to pay. Abusing this privilege warrants dismissal with prejudice as a sanction for lying, and we therefore
AFFIRMED.
Reference
- Full Case Name
- LaShawn N. LOFTON v. SP PLUS CORPORATION, f/k/a Standard Parking Corporation, and Teamsters Local Union No. 727
- Cited By
- 23 cases
- Status
- Published