Collateral Estoppel and Prima Facie Effect

• Pages: 239-269

239

CHAPTER VI

COLLATERAL ESTOPPEL AND

PRIMA FACIE EFFECT

Under the doctrine of collateral estoppel, also known as issue preclusion,

once an issue of fact or law (1) has been actually litigated and

determined in connection with a valid final judgment and (2) that

determination is necessary to the judgment, the decision is conclusive in

a subsequent action between the parties, whether on the same or a

different claim. Arizona v. California, 530 U.S. 392, 414 (2000) (quoting

RESTATEMENT (SECOND) OF JUDGMENTS § 27 (1982)); United States v.

Mendoza, 464 U.S. 154, 158 (1984); United States v. Alex Brown &

Sons, 169 F.R.D. 532, 540 n.4 (S.D.N.Y. 1996), aff’d sub nom., United

States v. Bleznak, 153 F.3d 16 (2d Cir. 1998); 18 CHARLES ALAN

WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND PROCEDURE

§§ 4416-19. See also NLRB v. Thalbo Corp., 171 F.3d 102, 109 (2d Cir.

1999) (noting issue preclusion arises only if “(1) the issues in both

proceedings are identical, (2) the issue in the prior proceeding was

actually litigated and actually decided, (3) there was full and fair

opportunity to litigate in the prior proceeding, and (4) the issue

previously litigated was necessary to support a valid and final judgment

on the merits.”); Anderson v. Genuine Par ts Co., 128 F.3d 1267, 1273

(8th Cir. 1997) (similar test); Aircra ft Bra king Systems Cor p. v. Local

856, UAW, 97 F.3d 155, 161 (6th Cir. 1996) (similar test). Collateral

estoppel is used defensively when the defendant asserts it as an

affirmative defense to preclude relitigation of issues previously decided

in a case where the plaintiff was a party. Menkes v. U.S. Dept. of

Homeland Sec., 637 F.3d 319, 334 (D.C. Cir. 2011). The Supreme Court

first approved the defensive use of collateral estoppel in Blonder-Tongue

Labs., Inc. v. Univ. of Ill. Found., 402 U.S. 313, 350 (1971). Collateral

estoppel is used offensively where the party asserting preclusion was not

a party to the prior case and the plaintiff uses collateral estoppel to

preclude relitigation of issues previously decided in a case where the

defendant was a party. Broan v. Colegio de Abogados de Puerto Rico,

613 F.3d 44, 48 n. 2 (1st Cir. 2010). The Supreme Court first approved

the offensive use of collateral estoppel in P arklane Hosiery Co. v. Shore,

439 U.S. 322, 326 (1979).

240 Antitrust Evidence Handbook

The doctrine of collateral estoppel has particular application in antitrust

litigation because many private antitrust cases are preceded by other

administrative, civil, or criminal proceedings. Thus, the effect of prior

proceedings on pending antitrust litigation is often a central issue. As

discussed below, some of these issues are governed by federal statute

(section 5(a) of the Clayton Act), while others are resolved under the

general common law doctrine of collateral estoppel. For examples of jury

instructions concerning the evidentiary effect of litigated government

judgments, see ABA SECTION OF ANTITRUST LAW, MODEL JURY

INSTRUCTIONS IN CIVIL ANTITRUST CASES G20-G26 (2005).

A. General Principles

1. Res Judicata and Collateral Estoppel Compared

a. Collateral estoppel bars relitigation only of those issues that have

been raised, litigated, and adjudicated as between the parties.

Howard Hess Dental Labs Inc. v. Dentsply Int’l, Inc., 602 F.3d 237,

247-48 (3d Cir. 2010); Pool Water Prods. v. Olin Corp., 258 F.3d

1024, 1031 (9th Cir. 2001); La Pr eferida v. Cerveceria Modelo, S.A.

de C.V., 914 F.2d 900, 905-06 (7th Cir. 1990); Golden Bridge

Technology, Inc. v. Apple, Inc., 937 F. Supp. 2d 490, 496 (D. Del.

2013); see also Sil-Flo, Inc. v. SFHC, Inc., 917 F.2d 1507, 1520

(10th Cir. 1990) (explaining that “‘Once a court has decided an issue

of fact or law necessary to its judgment, that decision may preclude

relitigation of the issue in a suit on a different cause of action

involving a party to the first case’”) (quoting Allen v. McCurry, 449

U.S. 90, 94 (1980)).

b. Res judicata, on the other hand, provides that “a final judgment on

the merits of an action precludes the parties or their privies from

relitigating issues that were or could ha ve been raised in that action.”

San Remo Hotel, L.P. v. City and Cnty. of San Fra ncisco, Cal., 545

U.S. 323, 336 n.16 (2005) (quoting Allen v. McCurry, 449 U.S. 90,

94 (1980)); see also RESTATEMENT (SECOND) OF JUDGMENTS §§ 18,

19.

c. The key distinction between res judicata and collateral estoppel is

that, “[w]hereas res judicata forecloses all that have been or might

have been litigated previously, collateral estoppel treats as final only

those questions actually and necessarily decided in a prior suit.”

Brown v. Felsen, 442 U.S. 127, 139 n.10 (1979); see also Red River

Freethinkers v. City of Fa rgo, 679 F.3d 1015, 1026 (8th Cir. 2012)