Civil Dispute Resolution &

Procedures II Class 20

Res Judicata in
Hypo Hell
 CLAIM PRECLUSION:
”USE IT OR LOSE IT!”

• Need all 3 elements:

1. There must be a prior judgment that is final, valid, and on
the merits (meaning the substantive case was decided—
or dismissed as punishment for non-cooperation)
2. The parties who are opponents in the later case must
have been opponents in the earlier case (or in privity).
3. The claim in the later case must be within the scope of
the judgment in the earlier case.
• How to tell? Our old friend . . . TRANSACTION/CNOF TEST!!!
• Note that claim preclusion bars claims that could have been but were
not brought up in previous case.
 Methodology
• First, look for a prior case. Label that Case 1.
Identify the outcome of that case. Who won/lost?
• Second, look for later case. Label that Case 2 (or 3, or
4, etc.).
• Third, apply the test for claim preclusion. Remember,
all 3 elements must be present for CP to work.
• Fourth, if claim preclusion fails, try issue preclusion.
Identify repeat player. Remember, all elements must
be present, including the subparts, for IP to work.
• Fifth, apply “fairness factors”—more on this to come!
 Hypo Hell
• Penny sues Doug for damage to her car after they were
involved in a car accident. She wins $1000. Later, Penny
files a suit for personal injury arising out of the same car
accident. What should Doug file?
• Penny sues Doug for damage to her car after they were
involved in a car accident. She loses. Later, Penny files a
suit for personal injury arising out of the same car
accident. What should Doug file?
• Penny sues Doug for damage to her car after they were
involved in a car accident. She wins $1000. Later, Doug
files a suit against Penny for personal injury arising out of
the same car accident. What should Penny file?
Hypo Hellier
• 3 car accident, involving separate cars driven by
Charlie Sheen, Chuck Lorre, and Ashton Kutcher.
Ashton sues Charlie and wins $50k. Ashton then
sues Chuck. Can Chuck argue that Ashton is claim
precluded?
• Same 3 car accident. Chuck sues Charlie and wins
$50k. Chuck later sues Charlie for defamation
because Charlie went on talk shows and accused
Chuck of being dishonest in the way he runs his
business. Can Charlie argue that Chuck is claim
precluded?
HYPO HELLIEST
MomandPop Shop, Inc. sue BigBox retailer in
state court, alleging unfair business practices
under state law. MomandPop Shop loses. Later,
MomandPop Shop sues BigBox in federal court
under federal antitrust law based on the same
unfair business practices. Federal antitrust cases
are within the EXCLUSIVE subject matter
jurisdiction of the federal courts. Is
MomandPop Shop claim precluded?
Claiming Claim Preclusion:
Takeaways

Remember, CP bars both claims that were litigated and

those that COULD HAVE BEEN litigated.
“Use it or Lose it!!!”
Elements:
– There must be a prior judgment that is final, valid, and on the
merits.
– The parties who are opponents in the later case must have
been opponents in the earlier case (or in privity).
– The claim in the later case must be within the scope of the
judgment in the earlier case.
• How to tell? TRANSACTION TEST!!!
• Also, if claim in case 2 was not within the SMJ of court in case 1,
then not within scope of prior judgment—so no claim preclusion
 ISSUE PRECLUSION:
“Been there, done that!!!”

Need all 3 elements:

1. There must be a prior judgment that is final and valid (and on
the merits, if issue goes to the merits)
2. Issue in later case must be the SAME as issue in earlier case,
and must have been
• Actually litigated in prior case
• Actually decided in prior case
• Necessary to the judgment in prior case
3. Party to be precluded in later case must have had their day in
court in earlier case. NOTE: that means that ONLY a repeat player
can be precluded! Also NOTE that issue preclusion ONLY
precludes issues that actually were litigated—not those that could
have been but were not.
 SAME ISSUE?

• Case 1: Ashton sues Charlie for trespass when Charlie

sneaks into Ashton’s trailer. Charlie defends on the
ground that he had permission from Ashton to enter the
trailer. Ashton wins.
• Case 2: Charlie AGAIN sneaks into Ashton’s trailer. (Claim
Preclusion?). Ashton sues Charlie for trespass. This time,
Charlie defends on the ground that because Charlie had
used that trailer for years before, he was entitled to be
there under the doctrine of adverse possession.
• Issue preclusion?
Was the issue actually litigated?
• Ashlee goes on Saturday Night Live and gets caught lip-synching. Lorne sues
Ashlee for breach of contract and fraud. His complaint clearly sets out both claims,
and the trial record discloses some evidence admitted on both. Jury instructed on
both claims. Verdict for Ashlee.
• 1. Lorne later goes on Tonight Show and said that Ashlee is a fraud who duped him
during her SNL appearance. Ashlee sues Lorne for defamation. Lorne defends by
arguing his statement was the truth. Can Ashlee issue preclude Lorne on whether
she committed fraud?
• 2. Now imagine that both claims were in complaint in case 1, but there was no
evidence presented on fraud, and the jury was never instructed on fraud. Issue
preclusion on fraud in case 2?
• 3. Now imagine that Lorne stipulated in case 1 that Ashlee had not committed
fraud. Can that stipulation be used as issue preclusion against Lorne in suit 2?
• 4. Now imagine that case 1 (Lorne v. Ashlee for breach of K and fraud) ends in a
default judgment (Lorne wins by default). In case 2, can Lorne preclude Ashlee
from litigating whether she committed fraud?
• TAKEAWAY: Actual litigation means evidence presented to a factfinder.
 The Plan

Monday, March 30:

Quiz 3 on Canvas during class (5 MBE-style multiple-choice questions/10 minutes)

Then, More work with preclusion

Prepare pp. 745-755

Future Quiz Dates: April 6, April 29

Future Quiz Dates: April 6, April 29