Res Judicata and Full Faith and Credit Across State Lines and in Federal Court

Res Judicata and Full Faith and Credit Across State Lines and in Federal Court

When is a judgment a judgment for purposes of res judicata or the doctrine of full faith and credit when the judgment is obtained in one court and sought to be enforced in a different court?  Dictionary

Many possible answers come to mind: when the judgment is entered, when the time for appeal has elapsed, during the pendency of an appeal for which no supersedeas bond was provided, when any appeal of the judgment is finished, when the judgment is final in the court that entered it, when the judgment is final in the court in which enforcement is sought.

There may be a State and a circumstance in which every one of these possible answers is the right answer.

Is a judgment that is entitled to full faith and credit also always entitled to res judicata?  No.  See generally Annot., Judgment Subject to Appeal as Entitled to Full Faith and Credit, 2 A.L.R.3d 1384 (1965); Annot., Judgment as Res Judicata Pending Appeal or Motion for a New Trial, or During the Time Allowed Therefor, 9 A.L.R.2d 984 (1950); Annot., Federal or State Law as Governing in Matters of Res Judicata and Collateral Estoppel in Federal Tort Claims Act Suit, 49 A.L.R.Fed. 326 (1980).

To take just one example, California and federal law differ in their definitions of finality for purposes of res judicata. The pendency of an appeal precludes finality under California law, but, under federal law and the law of many other States, the pendency of an appeal does not alter the res judicata effect of an otherwise final judgment of a trial court. Calhoun v. Franchise Tax Board, 20 Cal.3d 881, 887 (1978), cert. denied, 439 U.S. 872 (1978); Elliott v. Albright, 209 Cal.App.3d 1028, 1035 n.6 (1989) (under federal rule, judgment once rendered is final for res judicata until reversed on appeal or modified or set aside in entering court).  Finality of a judgment normally depends on the law of the jurisdiction that rendered the judgment, not the law of the jurisdiction wherein res judicata is asserted. Levy v. Cohen, 19 Cal.3d 165, 173 (1977), cert. denied, 434 U.S. 833 (1977) (federal court order or judgment “has the same effect in the courts of this state as it would have in a federal court”); Brinker v. Superior Court, 235 Cal.App.3d 1296 (1991) (New Jersey judgment is final even though pending on appeal);  28 U.S.C. §1738, construed in San Remo Hotel, L.P. v. City & County of San Francisco, 545 U.S. 323, 342 (2005) (“issues actually decided in valid state-court judgments may well deprive plaintiffs of the ‘right’ to have their federal claims relitigated in federal court”); McInnes v. State of California, 943 F.2d 1088, 1094 (9th Cir.1991).  As a result, when a federal judgment is asserted as res judicata in a California court, the pendency of an appeal will not defeat the defense.

This difference in the definition of finality may yield inequitable and conflicting results in certain cases, requiring litigants to take care as to the order of trials in the two courts and encouraging litigants to assert the defense of another action pending and to take other steps to protect themselves against the entry of a judgment that may be final for purposes of res judicata on a California lawsuit. At a minimum, litigants whose disputes cross borders need to protect themselves by determining the rules that govern these issues in all relevant jurisdictions.  Without that information, there is no way to assess the risks, benefits and urgency of particular actions in the litigation.

See generally Burbank, Interjurisdictional Preclusion, Full Faith and Credit, and Federal Common Law: A General Approach, 71 Cornell L. Rev. 733 (1986); Degnan, Federalized Res Judicata, 85 Yale L.J. 741 (1976); Gold, Clean Water, Federalism and the Res Judicata Impact of State Judgments in Federal Environmental Litigation, 16 U.C. Davis L. Rev. 1 (1982); Ginsburg, Judgments in Search of Full Faith and Credit: The Last-in-Time Rule for Conflicting Judgments, 82 Harv. L. Rev. 798 (1969);  Lenich, The Collateral Estoppel Effect of State Court Judgments in Federal Antitrust Actions: Unmaking the Judge-Made Law, 38 Rutgers L. Rev. 241 (1986); Schmitt, A Historical Reassessment of Full Faith and Credit, 20 Geo. Mason L. Rev. 485 (2013); Smit, International Res Judicata and Collateral Estoppel in the United States, 9 U.C.L.A.L. Rev. 44 (1962); Annot., Res Judicata or Collateral Estoppel Effect, in State Where Real Property is Located, of Foreign Decree Dealing with Such Property, 32 A.L.R.3d 1330 (1970); Annot., Uniform Enforcement of Foreign Judgments Act, 72 A.L.R.2d 1255 (1960); Developments in the Law—Section 1983 and Federalism: The Preclusive Effect of Prior State and Federal Judgments, 90 Harv. L. Rev. 1130 (1977); Note, Conflict of Laws—Multi–State Libel—Res Judicata, 23 S. Cal. L. Rev. 51 (1949).

This blog was drawn in part from my treatise, California Affirmative Defenses (2014)

Image courtesy of Flickr by greelie (creative-commons license, no changes made).