Also known as: claim-preclusive · claim preclusion
Written by attorneys — see sources below.
A judgment or dismissal that bars relitigation of the same claim between the same parties. The characterization turns on whether the rendering jurisdiction treats the disposition as an adjudication on the merits.
Carlos Castillo sued Citadel Security in State A superior court for breach of a security services contract. The court dismissed the action with prejudice because the four-year limitations period had run and State A law treats such dismissals as adjudications on the merits. Castillo then filed the identical claim in federal court in State B. The federal court must apply State A preclusion rules to determine whether the State A judgment is claim preclusive.
Cassandra Cooper obtained a Michigan injunction against General Motors that resolved her wrongful-discharge and contract claims. She later attempted to relitigate those same claims in another forum. The Michigan judgment merged the claims and prevented her from pursuing additional recovery against the same defendant.
Ronald Elwell worked as an engineering analyst for General Motors Corporation from 1959 until 1989. For fifteen years he was assigned to the Engineering Analysis Group studying the performance of GM vehicles in product liability litigation, particularly those involving fires. He assisted GM lawyers in defending such suits. Beginning in 1987 the Elwell-GM employment relationship soured. GM and Elwell first negotiated an agreement under which Elwell would retire after serving as a GM consultant for two years. When the time came for Elwell to retire, however, disagreement again surfaced and continued into 1991. A month later Elwell sued GM in a Michigan County Court alleging wrongful discharge and related tort and contract claims. GM counterclaimed that Elwell had breached fiduciary duties by disclosing privileged and confidential information and misappropriating documents. Following a hearing, the Michigan trial court on November 22, 1991, enjoined Elwell from consulting or discussing with or disclosing to any person any of General Motors Corporation's trade secrets, confidential information or matters of attorney-client work product relating in any manner to the subject matter of any products liability litigation whether already filed or to be filed in the future which Ronald Elwell received, had knowledge of, or was entrusted with during his employments with General Motors Corporation. In August 1992 the parties settled for an undisclosed sum. They jointly submitted a stipulated permanent injunction that the Michigan court entered without further hearing. The injunction comprehensively enjoined Elwell from testifying, without the prior written consent of General Motors Corporation, either upon deposition or at trial, as an expert witness, or as a witness of any kind, and from consulting with attorneys or their agents in any litigation already filed, or to be filed in the future, involving General Motors Corporation as an owner, seller, manufacturer and/or designer of the product(s) in issue. The separate settlement agreement stated that court-ordered testimony would in no way form a basis for an action in violation of the Permanent Injunction or this Agreement. In February 1990 Beverly Garner died when the engine of her 1985 Chevrolet S-10 Blazer caught fire after a Missouri highway collision. Her sons Kenneth and Steven Baker filed a wrongful-death product liability suit against GM in Missouri state court in September 1991. They alleged a defective fuel pump caused the post-collision fire. GM removed the case to federal court on diversity grounds. GM defended on the merits that the fuel pump was not faulty and that impact injuries alone caused the death. The Bakers sought to depose Elwell and call him at trial. GM objected on the basis of the Michigan injunction. After in camera review of the injunction and settlement agreement the Missouri federal district court permitted Elwell's deposition and trial testimony. The court relied on alternative grounds that Missouri public policy favored disclosure of relevant nonprivileged information and that the injunction was modifiable. At trial Elwell testified in support of the Bakers' fuel-pump defect claim. He identified a 1973 internal GM memorandum concerning fuel-fed engine fire risks. The jury returned an $11.3 million verdict for the Bakers. The district court entered judgment on the verdict. The Eighth Circuit reversed. It held that Elwell's testimony should not have been admitted because the Michigan injunction controlled. Missouri's public policy favoring full faith and credit outweighed any disclosure policy. The Supreme Court granted certiorari to decide whether the full faith and credit requirement stops the Bakers from obtaining Elwell's testimony in their Missouri action.
View caseCurtis Cannon was not a party to an earlier suit brought by a different plaintiff against the same defendant. He sought to assert a claim that would have been barred if he had been in privity with the prior plaintiff. The court examined whether the earlier judgment could bind him under principles of representation or control.
Brent Taylor and Greg Herrick were friends who shared an interest in restoring antique aircraft, including the F-45 model manufactured in the 1930s. In 1997, Herrick submitted a Freedom of Information Act request to the Federal Aviation Administration seeking technical documents from the F-45 certification process held in agency records. The FAA denied the request under the trade secrets exemption after consulting with Fairchild Corporation, the corporate successor to the original manufacturer, which objected to disclosure. Herrick then filed suit in the United States District Court for the District of Wyoming. The Wyoming District Court granted summary judgment to the FAA, and the Tenth Circuit affirmed that decision on July 24, 2002, upholding the exemption despite a 1955 letter from the manufacturer authorizing public use of the documents. Less than a month later, on August 22, 2002, Taylor submitted an identical FOIA request to the FAA for the same F-45 documents. When the agency did not respond, Taylor filed a complaint in the United States District Court for the District of Columbia, arguing that the 1955 letter had removed trade secret protection and raising additional issues about whether protection could be restored or recaptured. After Fairchild intervened as a defendant, the District Court for the District of Columbia dismissed Taylor's suit, concluding that he was virtually represented in Herrick's prior action. The United States Court of Appeals for the District of Columbia Circuit affirmed the dismissal, applying its own five-factor test for virtual representation that included identity of interests, adequate representation, and a close relationship. The record showed that Taylor served as president of the Antique Aircraft Association to which Herrick belonged, that Herrick had asked Taylor to assist with restoring his F-45 without a formal contract, that Taylor later retained the same attorney who represented Herrick, and that Herrick had provided Taylor with documents obtained during discovery in the Wyoming litigation. Taylor had not participated directly in Herrick's suit, received no notice of it, and exercised no control over its conduct. The Supreme Court granted certiorari to address the virtual representation doctrine applied by the lower courts.
View caseCarmen Choi filed a class action in federal court seeking statutory damages under state law. The defendant argued that a state procedural rule limiting class actions should prevent the suit from proceeding. The court analyzed whether the federal rule governing class certification displaced the state limitation for purposes of allowing the claim to go forward.
Shady Grove Orthopedic Associates, P.A., provided medical care to Sonia E. Galvez for injuries she suffered in an automobile accident. As partial payment for that care, Galvez assigned to Shady Grove her rights to insurance benefits under a policy issued in New York by Allstate Insurance Co. Shady Grove tendered a claim for the assigned benefits to Allstate, which under New York law had 30 days to pay the claim or deny it. Allstate apparently paid, but not on time, and it refused to pay the statutory interest that accrued on the overdue benefits at two percent per month. Shady Grove filed this diversity suit in the Eastern District of New York to recover the unpaid statutory interest. Alleging that Allstate routinely refuses to pay interest on overdue benefits, Shady Grove sought relief on behalf of itself and a class of all others to whom Allstate owes interest. The individual claim was worth roughly $500, which fell far short of the amount-in-controversy requirement for individual suits under 28 U.S.C. § 1332(a). The District Court dismissed the suit for lack of jurisdiction. It reasoned that N.Y. Civ. Prac. Law Ann. § 901(b), which precludes a suit to recover a penalty from proceeding as a class action, applies in diversity suits in federal court despite Federal Rule of Civil Procedure 23. Concluding that statutory interest is a penalty under New York law, it held that § 901(b) prohibited the proposed class action.
View caseNo. Whether the dismissal is claim preclusive depends on the law of the rendering jurisdiction. Some states treat limitations dismissals as adjudications on the merits while others do not. A later court must apply the rendering court's preclusion rules.
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Full faith and credit requires the federal court to apply the rendering state's preclusion law. The federal court cannot substitute its own view of whether a limitations dismissal counts as on the merits.
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No. The rule addresses only the effect within the same federal proceeding. It leaves jurisdictions free to decide whether particular dismissals, such as those based on limitations, carry preclusive effect in later actions.
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