IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF PENNSYLVANIA

TONY AND JENNIE PUNCH, as )

Parents and Natural Guardians of ) Civil Action No. 12-154 Erie

Lincoln Punch, a minor, and in their )

own right, )

Plaintiffs )

) District Judge Bissoon

v. ) Magistrate Judge Baxter

)

DOLLAR TREE STORES, INC., )

Defendant/Third ) 

Party Plaintiff, )

)

v. )

)

DOLLAR CONNECTION, LTD., )

Third Party Defendant/ )

Fourth Party Plaintiff )

)

v. )

)

GREENBRIER INTERNATIONAL, INC., )

Fourth Party Defendant. )

MAGISTRATE JUDGE'S REPORT AND RECOMMENDATION

I. RECOMMENDATION

It is respectfully recommended that Dollar Tree Store, Inc.'s and Greenbrier International, 

Inc.'s motion for summary judgment as to Dollar Connection, Ltd. [ECF No. 134], be denied.

II. REPORT

A. Relevant Procedural and Factual History

On July 6, 2012, Plaintiffs Tony and Jennie Punch, as parents and natural guardians of 

Lincoln Punch, a minor (“Minor Plaintiff”), and in their own right, initiated this civil action

against Defendant Dollar Tree Stores, Inc. (“Dollar Tree”), asserting claims of negligence and 

strict products liability arising from injuries suffered by the Minor Plaintiff after he ingested 

button batteries that were allegedly contained in a pair of lighted tweezers (“subject tweezers”)

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allegedly purchased from one of Dollar Tree’s retail stores.

On January 14, 2014, Dollar Tree filed a third party complaint against Third Party 

Defendant Dollar Connection, Ltd. (“Dollar Connection”), seeking indemnification and 

contribution from Dollar Connection in the event Dollar Tree is found liable to Plaintiffs on their 

underlying claims. [ECF No. 37]. In its third party complaint, Dollar Tree alleges that, to the 

extent Plaintiffs prove that they purchased the subject tweezers from Dollar Tree, the tweezers 

would have been purchased from Dollar Connection by Dollar Tree's importing affiliate, 

Greenbrier International, Inc. ("Greenbrier"), pursuant to a purchase order dated May 21, 2009 

("Purchase Order"). (ECF No. 37, Dollar Tree's Third Party Complaint, at ¶¶ 10-11). Dollar Tree 

contends that, pursuant to the terms of both the Purchase Order and a separate Continuing 

Vendor Indemnification Agreement, Dollar Connection agreed to defend, indemnify, and hold 

harmless Greenbrier and its parents and subsidiaries against, inter alia, claims of death or injury 

to any person from an alleged defect in the merchandise, or from a failure to warn. (ECF No. 37, 

Dollar Tree's Third Party Complaint, at ¶¶ 13-14, 16-18). Based on these allegations, Dollar 

Connection subsequently filed a complaint joining Greenbrier as a Fourth Party Defendant on 

December 17, 2014. [ECF No. 55].

In the interim, on March 17, 2014, Dollar Tree, Greenbrier, and Arch Insurance Company 

("Arch") initiated a declaratory judgment action against Dollar Connection, and its insurers, in 

the Circuit Court for the City of Norfolk, Virginia ("Virginia Court"), at Civil Action No. CL 14-

2111 ("Virginia Action"). [ECF No. 134-7]. In particular, Dollar Tree, Greenbrier, and Arch 

sought a declaratory judgment that Dollar Connection, and/or its insurers, are "obligated and/or 

have a duty to reimburse and indemnify [them] for any damages incurred, awarded, or paid to the 

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underlying plaintiffs by Dollar Tree and that they are further obligated to defend and to pay 

defense costs [they] have incurred and continue to incur in connection with the underlying 

lawsuit filed against Dollar Tree, Punch, et al. v. Dollar Tree Stores, Civil Action No. 1:12-cv00154, in the United States District Court for the Western District of Pennsylvania." (ECF No.

134-7, at ¶ 1).

Dollar Connection was properly served with the complaint in the Virginia Action, at its 

Hong Kong location, on April 29, 2014. [ECF No. 134-8]. On March 9, 2015, a default judgment 

was entered in the Virginia Action against Dollar Connection, due to its failure to file a 

responsive pleading within the time allotted by Virginia law (Id.). The Virginia Court 

subsequently denied Dollar Connection's motion for reconsideration of its Order of default 

judgment, by letter dated April 27, 2015. [ECF No. 134-9].

On September 30, 2015, Dollar Tree and Greenbrier (hereinafter referred to as the 

"Moving Parties") filed the instant motion for summary judgment as to Dollar Connection [ECF 

No. 134], arguing that "Pennsylvania law on claim preclusion mandates that the judgment of the 

[Virginia Court] be given res judicata in this action," and that judgment be entered against Dollar 

Connection accordingly. (Id. at ¶ 14). Specifically, the Moving Parties request that this Court 

enter judgment "that Dollar Connection reimburse and indemnify [them] for any payment of 

losses or any damages incurred, awarded, or paid to the Plaintiffs and to defend and to pay 

defense costs that [they] have incurred and continue to incur in connection with this lawsuit." 

(Id.). Dollar Connection filed a timely response to the motion for summary judgment asserting 

that the "'judgment' of the [Virginia Court] does not meet the standard for the application of res 

judicata...." (ECF No. 142, at ¶ 14). The Moving Parties subsequently filed a reply to Dollar 

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Connection's response [ECF No. 146], to which Dollar Connection has since filed a sur-reply 

[ECF No. 154]. This motion is now ripe for consideration. 

B. Standard of Review

Federal Rule of Civil Procedure 56(a) provides that summary judgment shall be granted if 

the “movant shows that there is no genuine dispute as to any material fact and the movant is 

entitled to judgment as a matter of law.” Under Rule 56, the district court must enter summary 

judgment against a party “who fails to make a showing sufficient to establish the existence of an 

element essential to that party’s case, and on which that party will bear the burden of proof at 

trial. Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). Summary judgment may be granted 

when no “reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty 

Lobby, Inc., 477 U.S. 242, 248 (19896). “[A] party seeking summary judgment always bears the 

initial responsibility of informing the district court of the basis for its motion, and identifying 

those portions of ‘the pleadings, depositions, answers to interrogatories, and admissions on file, 

together with the affidavits, if any,’ which it believes demonstrate the absence of a genuine issue 

of material fact.” Celotex, 477 U.S. at 323 quoting Fed.R.Civ.P. 56.

The moving party has the initial burden of proving to the district court the absence of 

evidence supporting the non-moving party’s claims. Celotex, 477 U.S. at 330. See also Andreoli 

v. Gates, 482 F.3d 641, 647 (3d Cir. 2007); UPMC Health System v. Metropolitan Life Ins. Co., 

391 F.3d 497, 502 (3d Cir. 2004). When a non-moving party would have the burden of proof at 

trial, the moving party has no burden to negate the opponent’s claim. Celotex, 477 U.S. at 323. 

The moving party need not produce any evidence showing the absence of a genuine issue of 

material fact. Id. at 325. “Instead, ... the burden on the moving party may be discharged by 

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‘showing’ – that is, pointing out to the district court – that there is an absence of evidence to 

support the nonmoving party’s case.” Id. After the moving party has satisfied this low burden, the 

nonmoving party must provide facts showing that there is a genuine issue for trial to avoid 

summary judgment. Id. at 324. “Rule 56(e) permits a proper summary judgment motion to be 

opposed by any of the kinds of evidentiary materials listed in Rule 56(c), except the mere 

pleadings themselves.” Id. See also Saldana v. Kmart Corp., 260 F.3d 228, 232 (3d Cir. 2001); 

Garcia v. Kimmell, 2010 WL 2089639, at * 1 (3d Cir. 2010) quoting Podobnik v. U.S. Postal 

Serv., 409 F.3d 584, 594 (3d Cir. 2005) (the non-moving party “must present more than just bare 

assertions, conclusory allegations or suspicions to show the existence of a genuine issue.”). 

In considering these evidentiary materials, “courts are required to view the facts and draw 

reasonable inferences in the light most favorable to the party opposing the summary judgment 

motion.” Scott v. Harris, 550 U.S. 372, 378 (2007) (internal quotation marks and alterations 

omitted). See also Doe v. Cnty. of Centre, Pa., 242 F.3d 437, 446 (3d Cir. 2001) (when applying 

this standard, the court must examine the factual record and make reasonable inferences 

therefrom in the light most favorable to the party opposing summary judgment). 

When considering a motion for summary judgment, the court is not permitted to weigh 

the evidence or to make credibility determinations, but is limited to deciding whether there are 

any disputed issues and, if there are, whether they are both genuine and material. Anderson., 477 

U.S. at 248, 255 (“only disputes over facts that might affect the outcome of the suit under the 

governing law will properly preclude the entry of summary judgment. Factual disputes that are 

irrelevant or unnecessary will not be counted.”). In determining whether the dispute is genuine, 

the court’s function is not to weigh the evidence or to determine the truth of the matter, but only 

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to determine whether the evidence of record is such that a reasonable jury could return a verdict 

for the nonmoving party. Id. at 249. 

C. Discussion

Under the Full Faith and Credit Act, 28 U.S.C. § 1738, "'judicial proceedings ... shall

have the same full faith and credit in every court within the United States ... as they have by law 

or usage in the courts of' the state from which they emerged. Section 1738 'has long been 

understood to encompass the doctrines of res judicata, or claim preclusion, and collateral 

estoppel, or issue preclusion.'" R&J Holding Co, v. Redev. Auth. of Montgomery, 670 F.3d 420, 

426 (3d Cir. 2011), quoting San Remo Hotel, L.P. v. City & County of San Francisco, 545 U.S. 

323, 326 (2005). Thus, it is well-settled that "a federal court must give to a state-court judgment 

the same preclusive effect as would be given that judgment under the law of the State in which 

the judgment was rendered." Migra v. Warren City School Dist. Bd. Of Educ., 465 U.S. 75, 81

(1984).

Here, the Moving Parties ask this Court to give full faith and credit to the default 

judgment issued against Dollar Connection in the Virginia Action, by applying the doctrine of res 

judicata. It is apparent, however, that the Moving Parties' motion is based upon application of 

Pennsylvania law regarding the preclusive effect of a default judgment, which holds that "a 

judgment is deemed final for purposes of res judicata or collateral estoppel unless or until it is 

reversed on appeal." Shaffer v. Smith, 673 A.2d 872, 875 (Pa. 1994). (ECF No. 146, Moving 

Parties' Reply, at p. 3). This application is erroneous. 

It bears repeating that the preclusive effect of a judgment is determined under the law of 

the adjudicating state, not the law of the state in which the judgment is sought to be applied. See

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O'Leary v. Liberty Mut. Ins. Co., 923 F.2d 1062, 1064 (3d Cir. 1991) (explaining that a district 

court determining whether res judicata applies because of a state court judgment must look to the 

law of the adjudicating state). Thus, we must look to Virginia law on this issue. In Virginia, "'a 

judgment is not final for the purposes of res judicata or collateral estoppel when it is being 

appealed or when the time limits fixed for perfecting the appeal have not expired.'" Buzzell v. JP 

Morgan Chase Bank, 596 Fed.Appx. 247, 248 (Mar. 10, 2015), quoting Faison v. Hudson, 243 

Va. 413, 417 S.E.2d 302, 305 (1992). Moreover, "the Supreme Court of Virginia has stated that 

'in the absence of a statutory provision to the contrary, a judgment is not final for purposes of 

appeal if it is rendered with regard to some but not all of the parties involved in the case.'" 

Buzzell, 596 Fed.Appx at 248, quoting Wells v. Whitaker, 207 Va. 616, 151 S.E.2d 422, 432 

(1966). 

Here, it is apparent that the default judgment at issue was entered in the Virginia Action 

against Dollar Connection only. [ECF No. 134-8]. As of the date of Dollar Connection's sur-reply 

in this matter, November 23, 2015, the claims against the remaining defendants in the Virginia 

Action had not yet been resolved. (ECF No. 154, Dollar Connection's sur-reply, at p. 3). Based 

on this record, it appears that the default judgment in the Virginia Action is not final for purposes 

of res judicata, because Dollar Connection may yet appeal the judgment under Virginia law. As a 

result, the Moving Parties' motion for summary judgment, based upon the application of res 

judicata, is premature and should be denied, accordingly.

III CONCLUSION

For the foregoing reasons, it is respectfully recommended that Dollar Tree Store, Inc.'s 

and Greenbrier International, Inc.'s motion for summary judgment as to Dollar Connection, Ltd. 

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[ECF No. 134], be denied.

In accordance with the Federal Magistrates Act, 28 U.S.C. § 636(b)(1), and Fed.R.Civ.P. 

72(b)(2), the parties are allowed fourteen (14) days from the date of service to file written 

objections to this report and recommendation. Any party opposing the objections shall have 

fourteen (14) days from the date of service of objections to respond thereto. Failure to file 

objections will waive the right to appeal. Brightwell v. Lehman, 637 F. 3d 187, 193 n. 7 (3d Cir. 

2011).

/s/ Susan Paradise Baxter 

SUSAN PARADISE BAXTER

United States Magistrate Judge

Dated: April 24, 2016

cc: The Honorable Cathy Bissoon

United States District Judge

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