Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-03-03982/USCOURTS-ca8-03-03982-0/pdf.json

Nature of Suit Code: 720
Nature of Suit: Labor Management Relations Act
Cause of Action: 

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1

The Honorable James M. Moody, United States District Judge for the Eastern

District of Arkansas.

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

No. 03-3982

___________

Wilford Banks, * 

* 

Appellant, * 

* Appeal from the United States

v. * District Court for the

* Eastern District of Arkansas.

International Union Electronic, * 

Electrical, Technical, Salaried and * 

Machine Workers; Communications * 

Workers of America; Council of * 

Industrial Organizers, * 

* 

Appellees. *

___________

Submitted: September 14, 2004

 Filed: December 3, 2004

___________

Before RILEY, LAY, and SMITH, Circuit Judges.

___________

SMITH, Circuit Judge.

Wilford Banks ("Banks") appeals the dismissal of his case. The district court1

found res judicata and collateral estoppel barred Banks from suing International

Union of Electrical Workers-Communication Workers of America ("IUE-CWA") and

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Council of Industrial Organizers ("CIO") a second time where the second suit was

based upon the same factual allegations as a prior suit that produced a judgment in

Banks's favor. We affirm.

I. Background

Banks was employed by IUE-CWA. Employees of IUE-CWA are members of

CIO. CIO represents them in employment disputes with IUE-CWA pursuant to a

collective bargaining agreement negotiated between IUE-CWA and CIO. Banks filed

suit ("Banks I") in the Eastern District of Arkansas against IUE-CWA and CIO

claiming violations of Title VII, 42 U.S.C. §§ 1985 and 1988, the National Labor

Relations Act, as amended, and the Labor Management Relations Act ("LMRA").

Specifically, Banks alleged that IUE-CWA violated express seniority provisions in

the collective bargaining agreement and harassed Banks through arbitrary transfers

to work locations. Additionally, Banks alleged that IUE-CWA improperly changed

his job assignment and his job requirements to require Banks to keep a detailed

written log of his activities and to report those activities to his superiors. Banks also

complained about the revocation of his possession and use of a personal computer

that Banks described as vital to the performance of his job. Banks alleged that these

actions were discriminatory, retaliatory, in breach of the collective bargaining

agreement, and for the purpose of keeping black workers from organizing. Lastly,

Banks alleged that CIO breached its duty to represent him in the grievance process

under the collective bargaining agreement.

CIO filed a motion to dismiss for failure to state a claim and the district court

granted CIO's motion. IUE-CWA then terminated Banks. After his termination, Banks

amended his complaint adding more Title VII violations against IUE-CWA, including

a claim of retaliation. Banks's amended pleadings alleged only Title VII violations.

In response to his termination, Banks also filed a grievance with CIO. In that

grievance, Banks protested and alleged that IUE-CWA retaliated and terminated him

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for filing a complaint with the Equal Employment Opportunity Commission

("EEOC") and for helping other black employees file EEOC complaints. 

Banks and IUE-CWA ultimately settled Banks I pursuant to Rule 68 of the

Federal Rules of Civil Procedure. That settlement covered all claims brought by

Banks, as amended, including all claims related to Banks's termination. Pursuant to

the parties' agreement, the district court entered judgment for Banks against IUECWA. Banks then requested CIO take his termination grievance to arbitration. CIO

refused the request on the grounds that the facts involved in the grievance were

resolved by the settlement and that an arbitrator would rule the case barred by res

judicata. 

Subsequently, Banks filed this suit ("Banks II") in the Eastern District of

Arkansas and named IUE-CWA and CIO as defendants. In Banks II, Banks repeated

his prior allegations of LMRA and Title VII violations. Banks re-alleged that IUECWA changed his job assignment and his job requirements to require Banks to keep

a detailed written log of his activities and to report those activities to his superiors

and that IUE-CWA arbitrarily revoked possession and use of his personal computer.

Banks also re-alleged that CIO ignored grievances that he filed pursuant to the

collective bargaining agreement. Finally, Banks re-alleged that IUE-CWA unlawfully

terminated him in retaliation for helping a fellow employee prepare an EEOC

complaint. There were no new facts alleged in the Banks II complaint that were not

alleged in the Banks I complaint. 

IUE-CWA and CIO brought separate motions to dismiss. IUE-CWA argued

that the Banks II complaint was barred by the doctrine of res judicata. CIO argued that

the Banks II complaint was barred by the doctrine of collateral estoppel. CIO also

argued that Banks failed to state a claim against CIO. The district court ruled that the

underlying facts of Banks I and Banks II were identical and thus the claims alleged

in Banks II against IUE-CWA were barred by res judicata. The district court also

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ruled that Banks was collaterally estopped from litigating his Banks II claims against

CIO. As a result, dismissal was ordered and judgment in favor of IUE-CWA and CIO

was entered into the record. Banks now seeks reversal of the district court's order of

dismissal and judgment in favor of IUE-CWA and CIO.

II. Discussion

A. Res Judicata

We review a district court's dismissal decision on grounds of res judicata de

novo. Lundquist v. Rice Mem'l Hosp., 238 F.3d 975, 976–77 (8th Cir. 2001). The

preclusion principle of res judicata prevents "the relitigation of a claim on grounds

that were raised or could have been raised in the prior suit." Lane v. Peterson, 899

F.2d 737, 741 (8th Cir. 1990). We undertake a three part inquiry to determine whether

res judicata applies addressing these issues: (1) whether the prior judgment was

rendered by a court of competent jurisdiction; (2) whether the prior judgment was a

final judgment on the merits; and (3) whether the same cause of action and the same

parties or their privies were involved in both cases. Id. Neither party disputes that the

first two requirements are met.

With regard to the third requirement of res judicata, we "adopted the position

of the Restatement (Second) of Judgments in determining whether two causes of

action are the same for res judicata purposes." Id. at 742. Section 24 of the

Restatement (Second) of Judgments provides that:

When a valid and final judgment rendered in an action extinguishes the

plaintiff's claim pursuant to the rules of merger or bar[,] . . . the claim

extinguished includes all rights of the plaintiff to remedies against the

defendant with respect to all or any part of the transaction, or series of

connected transactions, out of which the action arose.

What factual grouping constitutes a 'transaction,' and what groupings

constitute a 'series,' are to be determined pragmatically, giving weight

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In Lawlor, an action was brought to recover treble damages for alleged

violations of federal antitrust laws. Lawlor, 349 U.S. at 323. A previous suit had been

settled and dismissed with prejudice. Id. The subsequent suit named additional

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to such considerations as whether the facts are related in time, space,

origin, or motivation, whether they form a convenient trial unit, and

whether their treatment as a unit conforms to the parties' expectations or

business understanding or usage.

RESTATEMENT (SECOND) OF JUDGMENTS § 24. Thus, "a claim is barred by res judicata

if it arises out of the same nucleus of operative facts as the prior claim." Lane, 899

F.2d at 742 (citations omitted); see also Ruple v. City of Vermillion, 714 F.2d 860,

861 (8th Cir. 1983). 

Banks does not dispute that Banks I and Banks II arose out of the same nucleus

of operative facts. Instead, Banks erroneously argues that because Banks I was a Title

VII case and Banks II was a LMRA case, Banks I and Banks II represent separate and

distinct causes of action or claims. As stated in Lane, "reliance . . . on different

substantive law and new legal theories does not preclude the operation of res judicata.

. . . [W]here a plaintiff fashions a new theory of recovery or cites a new body of law

that was arguably violated by a defendant's conduct, res judicata will still bar the

second claim if it is based on the same nucleus of operative facts as the prior claim."

Lane, 899 F.2d at 744. In effect, "res judicata bars relitigation not only of those

matters that were actually litigated, but also those which could have been litigated in

the earlier proceeding." King v. Hoover Group, Inc., 958 F.2d 219, 223 (8th Cir.

1992).

Banks also argues that Lawlor v. Nat'l Screen Services, 349 U.S. 322 (1955),

and Alexander v. Gardner-Denver Co., 415 U.S. 36 (1974), preclude the application

of res judicata in this case. Both Lawlor and Alexander are distinguishable from the

present case.2

 Unlike in Lawlor, Banks II fails to allege additional facts not in

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defendants and alleged anti-trust violations that occurred after the previous suit had

been filed. Id. at 325. Dismissal on the grounds of res judicata was granted by the

district court and affirmed on appeal. Id. However, the United States Supreme Court

reversed, reasoning that the two suits were not based on the same cause of action

because "the conduct presently complained of was all subsequent to the . . . [previous]

judgment." Id. at 328, 330. Moreover, new antitrust violations were alleged. Id. at

328. The Court held that "[w]hile the . . . [previous] judgment precludes recovery on

claims arising prior to its entry, it cannot be given the effect of extinguishing claims

which did not even then exist and which could not possibly have been sued upon in

the previous case." Id.

In Alexander, plaintiff filed a grievance under the collective-bargaining

agreement between his employer and his union. Alexander, 415 U.S. at 39. The

collective-bargaining agreement prohibited racial discrimination but, at least initially,

plaintiff made no claim of racial discrimination. Id. However, plaintiff later amended

his claim to do so. Id. at 42. After an arbitrator ruled that there was no violation of the

collective-bargaining agreement, plaintiff filed a Title VII claim in the United States

District Court for the District of Colorado. Id. at 43. The district court dismissed the

suit on grounds of res judicata and the Tenth Circuit affirmed. Id. The Court reversed

and held that "while Title VII does not speak expressly to the relationship between

federal courts and the grievance-arbitration machinery of collective-bargaining

agreements[,] . . . [t]here is no suggestion in the statutory scheme that a prior arbitral

decision either forecloses an individual's right to sue or divests federal courts of

jurisdiction." Id. at 47. The Court reasoned that "[i]n submitting his grievance to

arbitration, . . . [plaintiff sought] to vindicate his contractual right under a collective

bargaining agreement. By contrast, in filing a lawsuit under Title VII, . . . [plaintiff

asserted] independent statutory rights accorded by Congress." Id. at 49-50. As a

result, plaintiff's Title VII claim was not barred by res judicata. Id. at 59-60. 

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existence at the time Banks I was filed. In fact, the LMRA violations alleged in Banks

II were originally alleged in Banks I. Banks chose to abandon those claims after

amending his complaint. Unlike in Alexander, the district court's res judicata ruling

in Banks II was not based on an arbitration decision, but rather a final judgment by

a federal district court. Moreover, Banks I's claims against IUE-CWA were not based

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on the grievance-arbitration machinery of his collective-bargaining agreement, but

statutory rights under LMRA that could have been and were originally brought in the

first lawsuit. Banks's LMRA claims are barred here because Banks voluntarily

amended his complaint in Banks I to exclusively allege Title VII violations and by

that amendment, abandoned or dismissed his LMRA claims. Res judicata now bars

Banks from relitigating those claims.

This reasoning does not apply to Banks claims against CIO, as, in Banks I, CIO

was dismissed without prejudice and CIO was not a party to the Rule 68 settlement.

We now examine the district court's ruling that Banks's claims against CIO in Banks

II were barred by collateral estoppel.

B. Collateral Estoppel

A district court's rulings on issues of law, including the application of collateral

estoppel, are reviewed de novo. Nat'l Fire Ins. Co. v. Terra Indus., Inc., 346 F.3d

1160, 1164 (8th Cir. 2003) (citations omitted). "Collateral estoppel 'bars the

relitigation of factual or legal issues that were determined in a prior . . . court action,

and applies to bar relitigation in federal court of issues previously determined.'" In re

Elisabeth Scarborough, 171 F.3d 638, 641 (8th Cir. 1999); see alsoParklane Hosiery

Co. v. Shore, 439 U.S. 322, 326 (1979). "Originally, collateral estoppel was limited

by the principle of mutuality, which provided that 'neither party could use a prior

judgment as an estoppel against the other unless both parties were bound by the

judgment.'" Lane, 899 F.2d at 741 (citation omitted). Under federal law, the mutuality

requirement has long been abandoned and a party may now "rely on collateral

estoppel even though he or she is not bound by the prior judgment if the party against

whom it is used had a full and fair opportunity and incentive to litigate the issue in

the prior action." Id.

Banks's claim against CIO for breach of duty of fair representation cannot

succeed absent a showing that his underlying claim against IUE-CWA is meritorious.

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See DiPinto v. Sperling, 9 F.3d 2, 4 (1st Cir. 1993). Banks cannot relitigate the merits

of his claims against IUE-CWA because those claims are barred by res judicata. As

a result, Banks is collaterally estopped from litigating his claims against CIO.

III. Conclusion

Banks had a full and fair opportunity, and did litigate Title VII and LMRA

claims against IUE-CWA in his prior action. The doctrine of res judicata now bars

Banks from relitigating those claims in this action. The doctrine of collateral estoppel

also bars Banks from litigating any claims arising from the same facts against CIO.

The judgment of the district court is affirmed.

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