CaseCast™ – "What you need to know"
Brief Fact Summary. Taylor’s friend filed a lawsuit seeking information and was denied. Then Taylor filed a similar action and the court bared suit based on the previous case.
Synopsis of Rule of Law. The Supreme Court holds that the doctrine of virtual representation is not a constitutionally approved method of nonparty preclusion.
The term privity has come to be used more broadly as a way to express the conclusion that nonparty preclusion is appropriate on any ground.View Full Point of Law
Issue. Whether a person is bound to a judgment by virtual representation as an appropriate nonparty preclusion.
Held. No. Parties are only held to a judgment when they are either a designated party to the litigation and were served process to that case. However there are a few exceptions to this rule, virtual representation is one that some courts have chosen to use. This court does not accept such an exception and thus extinguishes this doctrine. The defendants argue that when parties and cases are close enough, the court should find virtual representation. This court disagrees and cites the fundamental rule that a litigant is not bound by a judgment to which he was not a party. The court reviews all valid forms of nonparty preclusion and states that this is different from all acceptable versions. The court also states under adequate representation grounds that the interest must be the same, and the previous litigant must know he or she was acting in a representative capacity for future parties in future lawsuit, which is not the case here. The other issue is allowing this doctrine would allow judges to make “de facto” class actions at will to bind others. Also this type of exception will create more headaches for courts than help.
Discussion. The defendant argues they will be open to vexatious litigation; however, the court states that the doctrine of stare decisis will prevent such harm.