Federated Department Stores v. Moitie

Brief Fact Summary.

Plaintiff sues Defendant and has his case dismissed. Soon after, a favorable decision is issued by the Supreme Court and Plaintiff attempts to sidestep res judicata to have his case heard.

Synopsis of Rule of Law.

There is no exception to res judicata for individual equitable purposes.

Facts.

The United States sues Defendant Department Stores Federated for violating the Sherman Act. Thereafter, a few other local retailers filed class action antitrust suits against Defendant, too. Plaintiff Moitie filed in state court and Brown files in federal court. Moitie and Brown’s suits were basically identical to the United States’ case, except Moitie’s claim was premised on state rather than federal law. Defendant Federal Department Stores removed Plaintiff Moitie’s complaint to federal court based on diversity and federal question jurisdiction. The federal court then dismissed Moitie’s, Brown’s, and the other class action claims, reasoning that none of them sustained cognizable injuries under the Clayton Act. Instead of appealing like the other 5 plaintiffs, Moitie and Brown refiled their claims in state court. Brown’s lawsuit included four distinct state law claims. The state court nonetheless dismissed both Brown and Moitie’s suits citing res judicata. Brown and Moitie appealed to the Ninth Circuit. While their appeal was pending the Supreme Court issued a decision that held that retailers could sustain legal injury to their business upon which relief could be granted under the Clayton Act. In response the federal court of appeals reversed and remanded the dismissal of the five other antitrust cases. The court of appeals also reversed the district court’s dismissal of Moitie and Brown’s re-filed claim. Although the state appeals court noted that res judicata prevented reversal, justice demanded an exception.  The Supreme Court granted certiorari to review whether the Ninth Circuit’s exception to the res judicata doctrine was appropriate.The United States sues Defendant Department Stores Federated for violating the Sherman Act. Thereafter, a few other local retailers filed class action antitrust suits against Defendant, too. Plaintiff Moitie filed in state court and Brown files in federal court. Moitie and Brown’s suits were basically identical to the United States’ case, except Moitie’s claim was premised on state rather than federal law. Defendant Federal Department Stores removed Plaintiff Moitie’s complaint to federal court based on diversity and federal question jurisdiction. The federal court then dismissed Moitie’s, Brown’s, and the other class action claims, reasoning that none of them sustained cognizable injuries under the Clayton Act. Instead of appealing like the other 5 plaintiffs, Moitie and Brown refiled their claims in state court. Brown’s lawsuit included four distinct state law claims. The state court nonetheless dismissed both Brown and Moitie’s suits citing res judicata. Brown and Moitie appealed to the Ninth Circuit. While their appeal was pending the Supreme Court issued a decision that held that retailers could sustain legal injury to their business upon which relief could be granted under the Clayton Act. In response the federal court of appeals reversed and remanded the dismissal of the five other antitrust cases. The court of appeals also reversed the district court’s dismissal of Moitie and Brown’s re-filed claim. Although the state appeals court noted that res judicata prevented reversal, justice demanded an exception.  The Supreme Court granted certiorari to review whether the Ninth Circuit’s exception to the res judicata doctrine was appropriate.

Issue.

Does an exception exist to the doctrine of res judicata for individual equitable purposes.

Held.

No, an exception to res judicata does not exist for individual equitable purposes.

Concurrence.

Justice Justice Blackmun with Justices Marshall concurring in the judgement

Discussion.

1. Res judicata provides certainty and finality of decisions and allows parties to reasonably rely on the final judgement of courts.
2. Disturbing this policy would cause more harm than good.
3. If Moitie and Brown wanted to avoid preclusion based on res judicata they should have appealed and not refiled.
4. There is no need to assess Brown’s state law claims on the merits because his federal claims were precluded by res judicata.
5. The court of appeals decision is reversed and remanded.