IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
ELITE HOMES NW, LLC; NICK SCHERBININ; and VADIM and No. 86926-4-I VALENTINA SCHERBININ, DIVISION ONE Appellants, UNPUBLISHED OPINION v.
DANIEL V. ODIEVICH, individually and on behalf of the martial community comprised of DANIEL V. ODIEVICH and ANGELINA ODIEVICH; and NONA F. ADAMS, individually and on behalf of the marital community comprised of NONA F. ADAMS and JONATHAN ADAMS,
Respondents.
HAZELRIGG, C.J. — Elite Homes NW LLC appeals from two orders granting
summary judgment dismissal of various claims brought against the Odieviches and
Adamses. Vadim and Valentina Scherbinin did not disclose their potential suit
against the Odieviches as an asset during bankruptcy but later brought the present
action despite that omission. The trial judge concluded that the suit was barred by
judicial estoppel and dismissed it with prejudice. Because the record on summary
judgment and controlling case law plainly support such a ruling, the trial court did
not abuse its discretion and we affirm. No. 86926-4-I/2
FACTS
The Scherbinins and the Odieviches have been involved in an ongoing
dispute arising from the Odieviches’ investment in 2014 into a limited liability
company (LLC) owned and operated by the Scherbinins, Vadim, Valentina, and
their adult son, Nick. 1 Daniel and Angelina Odievich invested $250,000 into The
Peak Estate #3 LLC to develop property in King County. As a member of the LLC,
Vadim signed documents formalizing this investment. Over time, Daniel became
frustrated with the lack of return on the investment and Vadim’s failure to
communicate. Daniel later asserted in a declaration that when he finally heard
from Vadim nearly two years later, he was told that the LLC had run into “business
problems” and the money had been “lost.” In an attempt to recoup the investment,
Daniel 2 and other investors, including Nona Adams, contracted with Conflict
Solutions Group LLC (CSG).
Daniel and Adams entered into a service agreement with CSG in
September 2019. Under the terms of the contract, CSG would act on their behalf
to gather information about the Scherbinins and their assets, work with lawyers,
and prepare reports for the Odieviches, Adams, and law enforcement. An
addendum to the service agreement gave CSG the authority to pursue payment
on the promissory notes the Scherbinins had signed to secure the Odieviches’
1 As several parties to this litigation share a last name, we refer to them by their first names
as needed for clarity and precision. No disrespect is intended. 2 Daniel is a signatory to the contract for services with Conflict Solutions Group LLC (CSG),
but Angelina is not. Extensive communications between Daniel and Michael Williams, in his capacity as a representative of CSG, were transmitted to this court as part of the record on appeal and they suggest that CSG understood its client to be the Odieviches as a marital community. Because much of this litigation centers on that relationship and actions undertaken based on that contract, and because the suit was brought against the Odieviches as a marital community, we refer to them as such when discussing the litigants generally.
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investment, to file lawsuits on the Odieviches’ behalf, and to act as the Odieviches’
agent in pursuit of the funds owed, and further specified that CSG would be
allocated a portion of any subsequent judgments in the Odieviches’ favor or
amounts otherwise recovered. Michael Williams signed both the service
agreement and addendum on behalf of CSG.
In November 2019, CSG filed a complaint for damages against the
Scherbinins in Chelan County Superior Court in an attempt to recover the funds
owed to the Odieviches. The complaint stated that CSG was acting on behalf of
the Odieviches, Adams, and other investors pursuant to the assignment of rights
under the service agreement. It listed Vadim, Valentina, and Nick Scherbinin as
defendants, as well as nine LLCs operated by the Scherbinins. The primary
allegation underlying the CSG complaint was that the Scherbinins had defrauded
numerous investors, including the Odieviches and Adams. In addition to filing the
lawsuit, CSG gathered information about the Scherbinins and purported to have
communicated with various state and federal law enforcement agencies to report
conduct of the Scherbinins that it believed constituted crimes. CSG created
websites that would later give rise to the defamation claims the Scherbinins
brought against the Odieviches. CSG also filed liens against properties owned by
the Scherbinin family through their various LLCs, but in the fall of 2019, a judge in
King County Superior Court struck the liens and ordered CSG, and Williams
personally, to pay the Scherbinins’ attorney fees.
Vadim and Valentina filed for voluntary Chapter 7 bankruptcy in December
2020. On December 21, they filed their bankruptcy property schedule that included
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a section to record “claims against third parties,” which were to be recorded
regardless of whether a lawsuit had been filed or a demand for payment had been
made at the time of the bankruptcy disclosure. Among the assets listed was a
claim valued at $4,500 against CSG for filing fraudulent liens, which was roughly
the amount of attorney fees awarded in the King County action to remove the liens.
However, this section of the bankruptcy disclosure did not list any potential claims
against the Odieviches specifically.
The Odieviches sent a letter to the bankruptcy court in April 2021 that
referenced the Chelan County case and the reputed fraud by Vadim and Valentina,
as well as the Odieviches’ concern that the bankruptcy proceeding would allow
Vadim and Valentina to avoid payment of the claims of creditors “while keeping the
ill-gotten gains.” The Odieviches and Adams were listed as unsecured creditors
in the bankruptcy schedule and, as such, both received notices related to the
proceeding. Vadim and Valentina moved to convert their Chapter 7 proceeding to
a Chapter 11 bankruptcy, and a federal judge granted their motion in June 2021
after conducting a hearing. 3 In September, Vadim and Valentina submitted their
bankruptcy reorganization plan to the court for review. Their plan included the
following disclosure:
Post-Confirmation Litigation. The Debtors have a claim against an unknown person or persons responsible for waging an online defamation campaign against the Debtors. This person or persons registered an internet domain in their name and posted false, fraudulent, scandalous and inflammatory content that has substantially impaired the Debtors’ reputation and ability to conduct business. The Debtors require legal counsel to take action including but not limited to litigation directed toward taking down the fake
3 The bankruptcy judge issued an oral ruling on the motion, including findings of fact and
conclusions of law which are not present in the record before us.
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website and scrubbing false and defamatory online content to the maximum extent possible. If this case remains open after Confirmation the Debtors may seek, subject to court approval, employment of litigation counsel to pursue this claim. In the event the Debtors obtain a monetary recovery, the Debtors reserve the right to seek modification of the Plan to address distribution of any net recovery after approved legal fees and costs and compensable litigation expenses.
This reorganization plan was approved by the bankruptcy court in November.
The Scherbinins allege in their complaint in the case at issue in this appeal
that Nick Scherbinin is the owner and managing member of Elite Homes, a general
contracting firm that constructs homes in Washington and “Vadim and Valentina
Scherbinin are employees of Elite Homes, and the parents of . . . Nick Scherbinin.”4
(Some capitalization omitted.) In its January 2022 complaint against the
Odieviches, Elite Homes alleged that the Odieviches interfered with a business
expectancy, “publicized information and material that showed [the Scherbinins] in
a false light,” and engaged in defamation, conduct that “constitute[d] civil
harassment,” and “extreme and outrageous conduct designed to inflict severe
emotional distress.” The Odieviches’ answer, which both made specific denials
and asserted affirmative defenses, was filed a few weeks later, along with a
supporting declaration from Daniel and numerous exhibits. 5
Elite Homes filed an amended complaint in March 2023 that added Nona
and Jonathan Adams as defendants. 6 More critically, the new complaint added a
4 We use “Elite Homes” to refer to the appellants collectively where possible and
“Scherbinins” where Elite Homes is not involved. 5 The affirmative defenses relate to part of the complaint that was dismissed but not
appealed. 6 Because the Adamses joined the Odieviches’ defense in the trial court and in response
to this appeal, we refer to the respondents collectively as the Odieviches.
-5- No. 86926-4-I/6
sixth cause of action, specifically seeking relief under the criminal profiteering act, 7
based on their assertion that the Odieviches were leading organized criminal
activity, and damages as provided by statute. 8
The Odieviches filed a motion for partial summary judgment in September
2023. They averred that many of the causes of action rested on facts outside the
statute of limitations and sought dismissal of the criminal profiteering claim
“because there is no genuine dispute of material fact that [the Odieviches] never
engaged in a pattern of criminal profiteering activity, nor did they lead an organized
criminal enterprise.” They asserted that they had merely hired an “independent
contractor who held himself out as experienced in debt recovery investigations”
and “the act of hiring this contractor d[id] not constitute any of the acts of criminal
profiteering enumerated under” chapter 9A.82 RCW. Elite Homes filed its
opposition to this motion in October and offered criminal extortion under chapter
9A.56 RCW 9 as another offense that could support its allegation of criminal
profiteering and summarily asserted that genuine issues of material fact remained
7 Ch. 9A.82 RCW. 8 RCW 9A.82.100(1)(a) establishes a cause of action and remedy for a “person who sustains injury to [their] person, business, or property by an act of criminal profiteering that is part of a pattern of criminal profiteering activity” and authorizes them to “file an action in superior court for the recovery of damages and the costs of the suit, including reasonable investigative and attorney’s fees.” Leading organized crime, a class A felony, is one of the offenses expressly included the criminal profiteering act. See RCW 9A.82.060. Elite Homes argued in their amended complaint that the Odieviches had engaged in conduct that constitutes the intentional organizing, managing, directing, supervising, or financing any three or more persons with the intent to engage in a pattern of criminal profiteering activity; or inciting or inducing others to engage in violence or intimidation with the intent to further or promote the accomplishment of a pattern of criminal profiteering activity in violation of RCW 9A.82.060. 9 Specifically, Elite Homes analyzed extortion both in the first degree, a class B felony
pursuant to RCW 9A.56.120, and in the second degree, a class C felony under RCW 9A.56.130, in its opposition to summary judgment.
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as to its criminal profiteering claim sufficient to survive the motion for summary
judgment.
The trial court conducted a hearing on the summary judgment motion in
November 2023. Roughly a week later, it entered an order that granted the
Odieviches’ summary judgment motion as to the criminal profiteering claim and
dismissed that cause of action with prejudice. Elite Homes filed a motion for
reconsideration two days later that the court ultimately denied.
In May 2024, the Odieviches again moved for summary judgment, this time
arguing that the remainder of Elite Homes’ claims must be dismissed based on the
doctrine of judicial estoppel. This was true, they averred, because Vadim and
Valentina had failed to disclose the claims against the Odieviches as potential
assets during their bankruptcy proceeding and, thus, could not now assert them.
The Odieviches relied on precedent from our state courts and the Ninth Circuit
Court of Appeals in support of their position and included numerous exhibits. The
trial court granted the Odieviches’ second summary judgment motion and
dismissed the remaining claims with prejudice in June 2024.
Elite Homes timely appealed.
ANALYSIS
I. Standard of Review
We review the dismissal of a claim on summary judgment de novo and
conduct the same inquiry as the trial court. Wash. Fed. v. Harvey, 182 Wn.2d 335,
339, 340 P.3d 846 (2015). Summary judgment is appropriate if “‘there is no
genuine issue as to any material fact and the moving party is entitled to judgment
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as a matter of law.’” Id. at 340 (quoting Lybbert v. Grant County, 141 Wn.2d 29,
34, 1 P.3d 1124 (2000)). A fact is material if the outcome of the litigation turns on
said fact. Haley v. Amazon.com Servs., LLC, 25 Wn. App. 2d 207, 216, 522 P.3d
80 (2022). “The party moving for summary judgment bears the initial burden of
showing that there is no disputed issue of material fact. The burden then shifts to
the nonmoving party to present evidence that an issue of material fact remains.”
Id. (citation omitted). A defendant may rest a summary judgment motion on a
challenge to whether the plaintiff can make a prima facie showing as to each
element of the causes of action presented. Samra v. Singh, 15 Wn. App. 2d 823,
832, 479 P.3d 713 (2020). We “view the facts and all reasonable inferences
therefrom in the light most favorable to the nonmoving party.” Boyd v. Sunflower
Props., LLC, 197 Wn. App. 137, 142, 389 P.3d 626 (2016). Finally, we “may affirm
on any basis supported by the record whether or not the argument was made
below.” Bavand v. OneWest Bank, 196 Wn. App. 813, 825, 385 P.3d 233 (2016).
II. Judicial Estoppel
Elite Homes challenges the trial court’s conclusion on the applicability of the
doctrine of judicial estoppel. A different trial judge than the one who had ruled on
the Odieviches’ first summary judgment motion concluded that Vadim and
Valentina were “judicially estopped from asserting their claim [t]herein because
they did not disclose th[o]se claims on their schedule of assets filed in their
bankruptcy proceedings.” After so concluding, the court explained that the statute
of limitations had run on the defamation claim, Elite Homes had failed to produce
evidence to refute the Odieviches’ position that the claims were “at least
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substantially true and therefore not actionable defamation,” and the claim “for
tortious interference with a business expectancy failed for a lack of causally related
damages” because the business entities that suffered the purported harm were
now dissolved.
Elite Homes argues on appeal that the bankruptcy court already determined
Vadim and Valentina’s disclosure was adequate and state courts are required to
give effect to that determination. 10 Ultimately, it contends the Odieviches did not
make the showing required for the application of judicial estoppel. But, in briefing
and at oral argument, Elite Homes failed to meaningfully engage in a discussion
of the elements of judicial estoppel.
In response, the Odieviches assert that the application of judicial estoppel
was proper because “the Scherbinins had an affirmative obligation to disclose their
assets to the bankruptcy court on the asset disclosure form, but failed to disclose
this claim.” At oral argument before this court, the Odieviches asserted that the
limited discussion of the claim that did occur did not happen until after the
conversion of the bankruptcy from a Chapter 7 to a Chapter 11 proceeding, which
was approved by the creditors based on the disclosures made in the initial asset
schedule provided. 11
10 Elite Homes also argued that the doctrines of collateral estoppel and res judicata should
preclude the Odieviches from taking their current position because they did not contest the adequacy of the disclosure during bankruptcy. However, Elite Homes did not offer any authority that a creditor is required to prompt a debtor to pursue claims against that same creditor and did not offer substantive argument applying the elements of either of these doctrines to the present case. 11 Wash. Ct. of Appeals oral arg., Elite Homes NW, LLC v. Odievich, No. 86926-4-I (June
5, 2025), 11 min., 59 sec. to 14 min., video recording by TVW, Washington State’s Public Affairs Network, https://tvw.org/video/division-1-court-of-appeals-2025061139/.
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Separate from the summary judgment procedural posture presented here,
we review a determination by the trial court on the applicability of judicial estoppel
for abuse of discretion. Urbick v. Spencer Law Firm, LLC, 192 Wn. App. 483, 488,
367 P.3d 1103 (2016). 12 The trial court’s application of the doctrine is an abuse of
discretion if the decision is based on “untenable or unreasonable grounds.” Id.
Judicial estoppel “‘precludes a party from asserting one position in a court
proceeding and later seeking an advantage by taking a clearly inconsistent
position.’ It is intended to protect the integrity of the courts but is not designed to
protect litigants.” Arp v. Riley, 192 Wn. App. 85, 91, 366 P.3d 946 (2015) (footnote
and internal quotation marks omitted) (quoting Arkison v. Ethan Allen, Inc., 160
Wn.2d 535, 538, 160 P.3d 13 (2007)).
Three core factors guide a trial court’s determination of whether to apply the judicial estoppel doctrine: (1) whether “a party’s later position” is “clearly inconsistent with its earlier position”; (2) whether “judicial acceptance of an inconsistent position in a later proceeding would create the perception that either the first or the second court was misled”; and (3) “whether the party seeking to assert an inconsistent position would derive an unfair advantage or impose an unfair detriment on the opposing party if not estopped.”
Arkison, 160 Wn.2d at 538-39 (internal quotation marks omitted) (quoting New
Hampshire v. Maine, 532 U.S. 742, 750-51 (2001)).
Before turning to the merits of the ruling on review, we briefly review some
foundational principles of bankruptcy proceedings, as some aspects are relevant
12 Elite Homes contends that we should review the application of judicial estoppel de novo
but does not offering controlling authority in support of that position. Instead, it offers an inconclusive footnote from Taylor v. Bell. 185 Wn. App. 283 n.13, 340 P.3d 951 (2014). But, authority that predates Taylor, in addition to subsequent cases, have reviewed the application of judicial estoppel for abuse of discretion, even in the context of summary judgment. See Arkison v. Ethan Allen, Inc., 160 Wn.2d 535, 538, 160 P.3d 13 (2007); Urbick, 192 Wn. App. at 488.
- 10 - No. 86926-4-I/11
here. “Chapter 7 allows a debtor to make a clean break from [their] financial past,
but at a steep price: prompt liquidation of the debtor’s assets.” Harris v. Viegelahn,
575 U.S. 510, 513 (2015). The compromise is that “while a Chapter 7 debtor must
forfeit virtually all [their] prepetition property, [they are] able to make a ‘fresh start’
by shielding from creditors [their] postpetition earnings and acquisitions.” Id. at
514. When a debtor files for bankruptcy, an estate is created “which includes all
legal or equitable interests of the debtor in property as of the commencement
date.” Marks v. Benson, 62 Wn. App. 178, 184, 813 P.2d 180 (1991); 11 U.S.C. §
541(a)(1). In proceedings under Chapter 7, “the bankruptcy trustee has an
obligation to collect and reduce to money the property of the estate.” Marks, 62
Wn. App. at 184; 11 U.S.C. § 704(1). A debtor may convert their Chapter 7
bankruptcy to a Chapter 11 proceeding with permission from the court. 11 U.S.C.
§ 706. By contrast, in a Chapter 11 bankruptcy, “debtor[s] and creditors try to
negotiate a plan that will govern the distribution of valuable assets from the
debtor’s estate and often keep the business operating as a going concern.”
Czyzewski v. Jevic Holding Corp., 580 U.S. 451, 455 (2017).
In Chapter 11 bankruptcy proceedings, debtors have “an express,
affirmative duty to disclose all assets, including contingent and unliquidated
claims.” Skinner v. Holgate, 141 Wn. App. 840, 848, 173 P.3d 300 (2007); 11
U.S.C. § 521(a). This duty remains even if the chances of success are not known.
Skinner, 141 Wn. App. at 848-49. This court has already answered this precise
question and definitively held that judicial estoppel can apply to parties that have
a legal claim, file for bankruptcy, do not list the claim as an asset, and then,
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nonetheless, pursue those claims. Bartley-Williams v. Kendall, 134 Wn. App. 95,
98, 138 P.3d 1103 (2006). By failing to disclose an asset, the debtor keeps for
themselves property that “‘may have created a dividend for the debtor’s unsecured
creditors.’” Ingram v. Thompson, 141 Wn. App. 287, 291, 169 P.3d 832 (2007)
(quoting Johnson v. Si-Cor, Inc., 107 Wn. App. 902, 909, 28 P.3d 832 (2001)).
“[D]eliberate or intentional manipulation, which can be inferred from the record,
mandates” the application of judicial estoppel. Skinner, 141 Wn. App. at 853-54.
Vadim and Valentina did not list the claim against the Odieviches as an
asset and, even though its value may have been strictly theoretical at that time,
did not assign any value to it. The timing of the somewhat nebulous disclosure in
the organization plan within the bankruptcy proceeding informs part of our analysis.
Vadim and Valentina did not disclose the claim while the bankruptcy was
proceeding under Chapter 7. Instead, they waited until their case had successfully
been converted to one under Chapter 11. 13 Significantly, by waiting to disclose
the claim, it went from a potential asset the bankruptcy trustee would be duty-
bound to pursue immediately, so as to make the settlement funds available to
creditors, to a rather ambiguous asset that could be pursued at some indefinite
point in the future. 14 This supports the conclusion that Vadim and Valentina
derived an unfair advantage from the positions they took in the respective
proceedings. By failing to disclose the claim prior to conversion, only providing a
13 At oral argument in this court, counsel for Elite Homes represented that the bankruptcy
was ongoing. Wash. Ct. of Appeals oral arg., supra, at 5 min., 3 sec. 14 The Odieviches also challenged the causes of action Elite Homes presented on the
separate basis that the applicable statutes of limitations had expired on certain claims.
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vague description buried within the reorganization plan, and then pursuing the
present claim, they attempted to retain control over that asset.
The overall sequence of events is significant as well. See Skinner, 141 Wn.
App. at 853-54. The timeline of events established in the record suggests that
Vadim and Valentina deliberately kept the description of the claim in the
reorganization plan imprecise. CSG’s Chelan County case was filed in November
2019. That complaint explicitly stated that CSG had been assigned the right to file
that suit on behalf of investors and named the Odieviches and Adams among those
investors. Vadim filed a declaration in Chelan County Superior Court in June 2020,
six months before the bankruptcy schedule was filed in federal court, where he
explicitly connected CSG and the Odieviches. 15 Vadim stated in the declaration,
which he signed under penalty of perjury, that Daniel hired CSG and Daniel and
CSG had “engaged in a coordinated campaign to harass [his] family and [him].”
Vadim’s declaration even connected CSG to the websites he claimed were
defamatory and that served as the basis for the claims in the suit he, his family,
and Elite Homes ultimately filed against the Odieviches. And yet, in September
2021, after Vadim and Valentina filed their asset schedule in bankruptcy court, they
asserted in their proposed reorganization plan that the online harassment
campaign was being perpetrated by “an unknown person or persons.” It strains
credulity to suggest that Vadim had not connected CSG, the Odieviches, and the
15 While the header indicates that it was filed in Chelan County District Court, the cause
number on the declaration is for a superior court case. The caption indicates that Vadim and Valentina had filed an action against Williams in 2020, and the contents of the declaration include a number of their accusations of harassment and threats by him. It was filed in the instant case as an exhibit to a declaration filed by the Scherbinins/Elite Homes’ counsel, Brian Waid.
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reputedly defamatory websites more than a year after his signed declaration where
he expressly asserted details regarding those very connections.
By the fall of 2021, the Odieviches’ efforts through CSG to recover their
investment funds from the Scherbinins had been ongoing for two years. The
application of judicial estoppel is appropriate if the acceptance of inconsistent
positions would create the perception that either the first or the second court has
been misled. Arkison, 160 Wn.2d at 538-39. Here, the record supports this
conclusion; Vadim had numerous reasons to know, and even stated in a
declaration signed roughly a year and a half prior, that CSG and the Odieviches
were the source of the websites described in the reorganization plan filed in
bankruptcy court. The omission of this information from the bankruptcy schedule
is suggestive of deliberate or intentional manipulation. See Skinner, 141 Wn. App.
at 853-54 (“Judicial estoppel is proper so long as the debtor knew of the facts
giving rise to [their] inconsistent positions and [they] had a motive to conceal.”). It
also demonstrates that the two positions Vadim and Valentina took on this asset
are inconsistent; either the connection was known or it was not.
In certain circumstances this court has concluded that where a debtor failed
to properly list or accurately assign value to a potential claim as an asset, the
disclosure was nonetheless adequate such that the application of judicial estoppel
was incorrect. See Ingra v. Thompson, 141 Wn. App. 287, 292-93, 169 P.3d 832
(2007) (fact that debtor had undervalued personal injury claim did not justify
application of judicial estoppel); Baldwin v. Silver, 147 Wn. App. 531, 536-37, 196
P.3d 170 (2008) (fact that debtor had listed insurance claim in statement of affairs
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but not as an asset did not justify application of judicial estoppel). However, this
is not such a case. The record before the trial court here supports its reasonable
conclusion that at least Vadim had deliberately misled the bankruptcy court by
claiming ignorance as to who had published the websites after declaring under
penalty of perjury that CSG and Daniel were responsible. The trial court did not
abuse its discretion when it concluded that the doctrine barred the remaining
causes of action or ruled to dismissing the case with prejudice.
While the Odieviches did not move for dismissal on the basis of judicial
estoppel until May 2024, well after the trial court’s summary judgment dismissal of
Elite Homes’ criminal profiteering act claim on other grounds in November 2023,
the record before us supports our conclusion that judicial estoppel also applied to
that cause of action because that claim was completely absent from the disclosure
of the potential suit in the September 2021 reorganization plan. We may affirm on
any basis supported by the record. Bavand, 196 Wn. App. at 825. Because Vadim
and Valentina’s assertions in the reorganization plan would have equally estopped
Elite Homes from presenting the criminal profiteering claim, we need not reach the
substance of its separate arguments regarding the November 2023 summary
judgment order dismissing that cause of action.
Affirmed.
WE CONCUR:
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