A federal judge has issued a ruling in the bankruptcy case of Shilo Sanders, giving the Colorado football player a victory that keeps alive his effort to discharge more than $11 million in debt.
But the case is still far from over. Judge Michael E. Romero ruled the case would require a trial of sorts to determine whether the son of Colorado coach Deion Sanders was being “willful and malicious” when he allegedly assaulted a security guard at his school in 2015, when Shilo was 15 years old.
“This Court has already determined the issues of willful and malicious behavior will be re-litigated in this proceeding,” Romero said in his ruling issued Tuesday, obtained by USA TODAY Sports. “That determination will necessarily involve an examination of any justification, including self-defense, offered by Sanders for his allegedly willful and malicious behavior.”
If the judge had ruled the other way on this matter, Shilo Sanders would have suffered a crippling blow in his effort to erase his $11 million debt to John Darjean, the security guard he allegedly assaulted in 2015. He would have been on the hook to pay that money back to Darjean, pending any appeal. Instead, his case will continue to be fought on multiple fronts, more than nine years after the controversy started.
How did this bankruptcy case get this far?
Darjean had sued Shilo in 2016, seeking damages for what he described as severe and permanent injuries, including incontinence. He said Shilo swung an elbow at his upper chest and punched him as he tried to confiscate his phone at school.
Shilo and his father Deion disputed the allegations, saying it was Darjean who was the aggressor, not Shilo. Shilo even testified in pretrial proceedings and filed counter claims against Darjean. But he didn’t show up for trial in 2022, leading to a $11.89 million default judgment against Shilo Sanders in 2022.
After Darjean pursued debt collection on that judgment last year, Shilo filed for bankruptcy in October 2023 in an attempt to get rid of that debt.
But Darjean wants the money he is owed and is fighting Shilo’s discharge attempt in bankruptcy court.
What was this bankruptcy ruling about?
Debtors generally can discharge their debts by filing for bankruptcy, as Shilo Sanders did last year. The reason he did so was to erase this $11 million debt to Darjean so he could get a “fresh start, free from the oppressive burdens of his debt,” as his attorneys said. But there are exceptions in the law that prevent debts from being discharged in certain cases. One of them is if the debt stems from a “willful and malicious injury by the debtor.”
In response to Shilo’s bankruptcy filing last year, Darjean’s attorneys filed two complaints to contest Shilo’s attempted discharge as Darjean continues to pursue the money Sanders owes him.
In one of those complaints, they argued that Shilo Sanders should not be allowed a discharge of this debt because it stemmed from a willful and malicious injury. They wanted the judge to make a summary judgment ruling about this, arguing at a hearing in Denver last month that the matter was already litigated in a state court in Texas and should be precluded from being litigated again.
But the bankruptcy judge didn’t fully agree with Darjean’s attorneys and denied their summary judgment motion as it related to whether Shilo’s behavior was willful and malicious. He only agreed that the issues of causation and damages were litigated in state court, not Shilo’s state of mind during the incident in 2015.
“The State Court Order and Judgment (in Texas) are devoid of any discussion of Sanders’ intent,” the judge wrote. “Given this lack of findings, the Court is reluctant to conclude the issue of self-defense was fully and fairly litigated in state court.”
Why did the judge rule in Shilo Sanders’ favor?
The problem for Darjean in this matter is that the state court in Texas didn’t include the words “willful and malicious” in its findings and judgment against Sanders in 2022. But it left no doubt about who was responsible.
“The Court finds that John Darjean’s injuries and damages were a foreseeable consequence of the physical assault perpetrated by Shilo Sanders,” the state court said in its findings of fact and conclusions of law in 2022.
That wasn’t good enough for the bankruptcy judge to rule Shilo acted willfully and maliciously during this alleged assault in 2015, at least according to bankruptcy law. Being willful and malicious relates to his state of mind at the time.
“Sanders pled self-defense in his state court answer, but he obviously was not at trial and did not present any evidence regarding his state of mind,” the bankruptcy judge wrote. “One could argue the state court necessarily rejected all Sanders’ pled defenses when it determined he committed assault. However, the State Court Order and Judgment make no mention of self-defense, or any justification offered by Sanders for his actions. There is no indication the state court considered Sanders’ state of mind or whether his alleged apprehension of danger was reasonable.”
What’s next in this case?
The judge said the “issues of willful act, malicious injury, or self-defense and those matters will be determined in this proceeding.” That means a trial of sorts on this matter in the future. Meanwhile, the trustee overseeing the bankruptcy estate recently has been seeking information about Shilo’s assets in an effort to collect them for creditors.
Darjean also has another complaint pending that accused Shilo of omitting or concealing assets. Shilo’s attorneys disputed this and say they have cooperated.
Shilo, now 24, is a graduate student at Colorado and will play his last college game Dec. 28 in the Alamo Bowl against BYU.
Follow reporter Brent Schrotenboer @Schrotenboer. Email: bschrotenb@usatoday.com