NOTE: This disposition is nonprecedential. 

United States Court of Appeals 

for the Federal Circuit 

__________________________ 

MORRIS REESE, 

Plaintiff-Appellant, 

v. 

VERIZON CALIFORNIA, INC., 

Defendant-Appellee, 

AND

AT&T CALIFORNIA, 

Defendant-Appellee. 

__________________________ 

2012-1048 

__________________________ 

Appeal from the United States District Court for the 

Central District of California in Case No. 11-CV-1934, 

Judge S. James Otero. 

____________________________ 

Decided: December 21, 2012 

____________________________ 

RACHEL CLARK HUGHEY, Merchant & Gould, P.C., of 

Minneapolis, Minnesota, argued for plaintiff-appellant. 

MICHAEL J. SONGER, Crowell & Morning, LLP, of 

Washington, DC, argued for both defendants-appellees. 
REESE v. VERIZON CALIFORNIA 2

With him on the brief were JENNIFER H. BURDMAN, for 

defendant-appellee, AT&T California; and KEVIN P.

ANDERSON and JAMES H. WALLACE, Wiley Rein LLP, of 

Washington, DC, for defendant-appellee Verizon California. 

__________________________ 

Before LOURIE, DYK, and MOORE, Circuit Judges. 

Opinion for the court filed by Circuit Judge LOURIE. 

Dissenting opinion filed by Circuit Judge MOORE. 

LOURIE, Circuit Judge. 

Morris Reese (“Reese”) appeals from the judgment of 

the United States District Court for the Central District 

of California dismissing his first amended complaint 

against Verizon California Inc. (“Verizon”) and AT&T 

California (“AT&T”) (collectively, “Appellees”) based on 

the doctrine of collateral estoppel. Order Granting Defs.’ 

Mot. to Dismiss, Reese v. Verizon Cal. Inc., No. 11-01934 

(C.D. Cal. Aug. 11, 2011), ECF No. 26. Because collateral 

estoppel was applicable and the district court did not 

abuse its discretion in applying collateral estoppel, we 

affirm. 

BACKGROUND

Reese owns U.S. Patent 6,868,150 (the “’150 patent”), 

directed to methods for providing landline telephone 

Caller ID with Call Waiting. In May 2007, Reese asserted 

the ’150 patent against Southwestern Bell Telephone Co. 

(AT&T’s operating telephone company in Texas) and GTE 

Southwest Inc. (Verizon’s operating telephone company in 

Texas) in the United States District Court for the Eastern 

District of Texas; parent companies AT&T, Inc. and 

Verizon Communications Inc. were voluntarily dismissed 
3 REESE v. VERIZON CALIFORNIA

from that litigation. Reese v. Sw. Bell Tel., L.P., No. 07-

219 (E.D. Tex. Dec. 22, 2008) (Reese I). 

In Reese I, Reese alleged that the defendants infringed at least claims 1, 7, 13, 18, 23, 25, 32, and 36 of 

the ’150 patent, but following an unfavorable claim construction order, Reese stipulated to the entry of final 

judgment of noninfringement of claims 1, 7, 13, 18, 25, 

and 36.1 Stipulation & Joint Mot. for Dismissal & Final 

J., Reese v. Sw. Bell Tel., L.P., No. 07-219 (E.D. Tex. Dec. 

19, 2008), ECF No. 15 (“Stipulation”). Article 2 of the 

Stipulation states that “[t]he parties also stipulate to the 

dismissal with prejudice of all infringement claims and 

assertions by Plaintiff with respect to claims 23 and 32 of 

the ’150 patent.” Id. Article 4 of the Stipulation states: 

As this stipulation resolves all claims and counterclaims, the Parties stipulate to the entry of final judgment. The parties stipulate that the 

entry of final judgment resulting from this stipulation shall constitute a final judgment on the 

merits of Plaintiff’s claims for purposes of res judicata, collateral estoppel, issue preclusion and 

claim preclusion. 

Id. 

In March 2011, Reese sued AT&T and Verizon in the 

United States District Court for the Central District of 

California, reasserting that the same landline telephone 

services offering so-called Call Waiting ID, which were at 

issue in Reese I, infringed claims 23 and 32 of the ’150 

patent. AT&T then filed a motion to dismiss Reese’s first 

amended complaint under Fed. R. Civ. P. 12(b)(6), which 

 1

 Reese later appealed the Eastern District of 

Texas’s claim construction ruling, which we affirmed in 

all respects. Reese v. Sw. Bell Tel., L.P., 333 F. App’x 570 

(Fed. Cir. 2009). 
REESE v. VERIZON CALIFORNIA 4

Verizon joined. The district court granted the motion to 

dismiss on the ground that the case was barred by collateral estoppel based on the judgment in Reese I. Order 

Granting Defs.’ Mot. to Dismiss, Reese v. Verizon Cal. Inc., 

No. 11-01934 (C.D. Cal. Aug. 11, 2011), ECF No. 26. 

The court concluded that AT&T and Verizon had established all the elements of collateral estoppel required 

under Ninth Circuit law: (1) there was an undisputed 

identical issue because Reese alleged the same claims 

regarding the same patent as in the Reese I proceeding, 

such that the present action would involve the same rule 

of law, similar evidence, and overlapping arguments; (2) 

final judgment on the merits was reached in Reese I, 

where Reese specifically agreed to dismiss claims 23 and 

32 of the ’150 patent with prejudice and stipulated that 

his dismissal would constitute a final judgment on the 

merits for the purposes of collateral estoppel and issue 

preclusion; and (3) there was undisputed privity between 

the parties involved in Reese I and the instant action. Id.

at 3–5. In response, Reese filed a motion for reconsideration, which the district court denied. Order Den. Pl.’s 

Mot. for Recons., Reese v. Verizon Cal. Inc., No. 11-01934 

(C.D. Cal. Sep. 21, 2011), ECF No. 34. 

Reese timely appealed the district court’s rulings. We 

have jurisdiction under 28 U.S.C. § 1295(a)(1). 

DISCUSSION

The grant of a motion to dismiss under Fed. R. Civ. P. 

12(b)(6) is reviewed de novo, accepting all factual allegations in the complaint as true and construing them in the 

light most favorable to the nonmoving party. Skilstaf, 

Inc. v. CVS Caremark Corp., 669 F.3d 1005, 1014 (9th Cir. 

2012); Cambridge v. United States, 558 F.3d 1331, 1335 

(Fed. Cir. 2009). 
5 REESE v. VERIZON CALIFORNIA

Application of the principles of collateral estoppel is 

not a matter within our exclusive jurisdiction; thus, we 

apply the law of the circuit in which the district court sits, 

here the Ninth Circuit. Applied Med. Res. Corp. v. United 

States Surgical Corp., 435 F.3d 1356, 1360 (Fed. Cir. 

2006); Pharmacia & Upjohn Co. v. Mylan Pharm., Inc., 

170 F.3d 1373, 1381 n.4 (Fed. Cir. 1999). In the Ninth 

Circuit, the availability of collateral estoppel is a mixed 

question of law and fact reviewed de novo. See In re 

Lopez, 378 F. App’x 610, 613 (9th Cir. 2010); Dias v. 

Elique, 436 F.3d 1125, 1128 (9th Cir. 2006); Plaine v. 

McCabe, 797 F.2d 713, 718 (9th Cir. 1986). Once it is 

determined that collateral estoppel is available, the Ninth 

Circuit reviews a district court’s decision to accord preclusion and apply collateral estoppel for an abuse of discretion. Id; see also Applied Med. Res., 435 F.3d at 1360. 

The Ninth Circuit also reviews de novo a district court’s 

interpretation of a consent judgment. Skilstaf, 669 F.3d 

at 1014. 

Collateral estoppel, or issue preclusion, prevents a defendant from having to relitigate issues that have been 

fully and fairly litigated in a previous action. Pharmacia 

& Upjohn, 170 F.3d at 1379. More specifically, collateral 

estoppel in a patent case prevents a plaintiff who previously litigated a claim that certain technology infringed 

its patent (and lost) from taking “another bite at the 

apple” by again asserting that the same technology infringes the same patent. See Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA, Inc., 617 

F.3d 1296, 1312 (Fed. Cir. 2010) (finding collateral estoppel where the accused technology in the second case was 

identical to that in the first case). The Ninth Circuit has 

found collateral estoppel where: (1) the issue necessarily 

decided at the previous proceeding is identical to the one 

that is currently sought to be relitigated; (2) the first 
REESE v. VERIZON CALIFORNIA 6

proceeding ended with a final judgment on the merits; 

and (3) the party against whom collateral estoppel is 

asserted was a party or in privity with a party in the first 

proceeding. Skilstaf, 669 F.3d at 1021; Reyn’s Pasta 

Bella, LLC v. Visa USA, Inc., 442 F.3d 741, 746 (9th Cir. 

2006).2 There is no dispute on appeal that the privity 

required is found here;3 thus, the question before us is 

whether the first two prongs of the test are satisfied. 

Reese now argues that there is no identical issue between this action and the previous case because the 

dispute at bar, i.e., infringement of claims 23 and 32 of 

the ’150 patent, was not “actually litigated” and expressly 

decided by the district court in Reese I. Similarly, although Reese concedes that the stipulated dismissal with 

prejudice in Reese I did constitute a final judgment, he 

argues that it was not a final judgment for the purposes of 

collateral estoppel as to claims 23 and 32 of the ’150 

patent because the issue of infringement of those claims 

was not decided. Reese further contends that Arizona v. 

California, 530 U.S. 392, 414 (2000), establishes a general 

rule that collateral estoppel does not apply to consent 

judgments because in those situations there will not have 

been a decision on an issue in the underlying case. Reese 

thus seeks to characterize the Stipulation as a consent 

judgment or settlement whereby the parties resolved the 

 2

 Reese argues a four-part test for collateral estoppel, citing Syverson v. International Business Machines 

Corp., 472 F.3d 1072, 1078 (9th Cir. 2007), but concedes 

that the articulation of the test recited herein is functionally identical. Appellant Br. 14 n.6. 3

 Reese does not acquiesce in the district court’s 

finding that privity exists on both sides of the litigation, 

but concedes that collateral estoppel requires only that 

privity exist on the side of the party against whom estoppel is asserted. See Syverson, 472 F.3d at 1078. Reese 

was a party to both suits. 
7 REESE v. VERIZON CALIFORNIA

issue of infringement of six other claims of the ’150 patent 

while merely dismissing the infringement assertions of 

claims 23 and 32. Reese asserts that Appellees did not 

stipulate to noninfringement of claims 23 and 32 as they 

did the others, so there is no identical issue here, and that 

it is also irrelevant that he dismissed his claims with 

prejudice because doing so did not resolve the undecided 

issue of infringement of claims 23 and 32 for the purposes 

of collateral estoppel. 

Appellees respond that Reese had a full and fair opportunity to litigate infringement in Reese I and did so; he 

had his day in court and simply stopped after an adverse 

claim construction ruling in the prior case. In the present 

case, Reese has again accused precisely the same products, viz., Call Waiting ID of landline telephone services, 

of infringing precisely the same patent claims, viz., claims 

23 and 32 of the ’150 patent. Appellees argue that an 

identical issue does not have to be “decided” to have 

preclusive effect because Reese expressly agreed in the 

Stipulation that the final judgment in Reese I would 

preclude future patent infringement suits on Call Waiting 

ID services. Moreover, Appellees assert that consent 

judgments are routinely given preclusive effect when that 

was the intent of the parties, and the present action is 

distinguishable from Arizona because the parties in Reese 

I did more than merely settle their case with a consent 

judgment. The Stipulation ended Reese I with a final 

judgment on the merits with Reese’s dismissal with 

prejudice; although he could have reserved the right to 

litigate infringement in the future, he expressly consented 

otherwise. Consequently, Appellees contend that collateral estoppel applies here because the intent and scope of 

the Stipulation are specific and unambiguous, the accused 

products and technology are the same, and the asserted 

patent claims are the same. We agree. 
REESE v. VERIZON CALIFORNIA 8

We have previously held that issue preclusion or collateral estoppel may indeed arise by reason of stipulated 

judgment or consent decree, under which the primary 

consideration is the intent of the parties with respect to 

its preclusive effect. Hartley v. Mentor Corp., 869 F.2d 

1469, 1471 (Fed. Cir. 1989) (applying Ninth Circuit law to 

an appeal from C.D. Cal.). In Yachts America, Inc. v. 

United States, 673 F.2d 356, 361 (Ct. Cl. 1982), one of our 

predecessor courts also held that broad, far-reaching 

preclusive language in a consent decree terminating a 

prior litigation and dismissing with prejudice “all other 

issues” constituted a final judgment on an issue not 

specifically addressed in the agreement, and therefore 

that the doctrine of collateral estoppel precluded relitigation of that issue. 

Subsequently, and contrary to Reese’s interpretation, 

the Supreme Court in Arizona also indicated that settlements may occasion collateral estoppel when it is clear 

that the parties intended their agreement to have such an 

effect. Arizona, 530 U.S. at 414. Indeed, the Court concluded that collateral estoppel did not apply in that case 

because the consent judgment in the first action was 

“ambiguous as between mutually exclusive theories of 

recovery” and therefore “too opaque to serve as a foundation for issue preclusion.” Id. at 417–18. However, that is 

not the case before us. 

Echoing Hartley, this case presents a situation in 

which a patentee clearly dismissed his claim with prejudice; such a stipulated judgment operates as an adverse 

adjudication on the merits of his claim. To prevail, Reese 

needed to show that the parties in Reese I did not intend 

for their stipulated judgment to have any preclusive effect 

on the issue of infringement. He did not make such a 

showing. The Stipulation is not ambiguous: Article 4 

specifically recites that “this stipulation resolves all
9 REESE v. VERIZON CALIFORNIA

claims.” Stipulation 2 (emphasis added). Reese’s only 

theory of recovery in Reese I was infringement, and the 

Stipulation explicitly states that the parties intended 

their agreement to have preclusive effect: the dismissal 

“shall constitute a final judgment on the merits of Plaintiff’s claims for purposes of res judicata, collateral estoppel, issue preclusion, and claim preclusion.” Id. Reese 

argues that the “mere” dismissal of claims 23 and 32, as 

opposed to the stipulation of noninfringement of the other 

claims, avoids the effect of collateral estoppel. The answer to that argument rests with the fact that Reese 

agreed to dismiss claims 23 and 32 with prejudice and 

stipulated that the dismissal would constitute a final 

judgment for the purpose of collateral estoppel. The 

district court here is simply enforcing Reese’s own agreement. Accordingly, we conclude that collateral estoppel 

was applicable here because Reese explicitly consented to 

dismiss with prejudice his previous action involving the 

same patent claims asserted against the same technology 

and agreed to an entry of final judgment on the merits 

regarding infringement for the express purpose of precluding future duplicative litigation. 

Finally, having determined that collateral estoppel 

was applicable, the district court did not abuse its discretion in applying collateral estoppel. The Ninth Circuit 

has held that a motion to dismiss may be supported by 

collateral estoppel, particularly when the parties have 

negotiated a consent judgment or settlement agreement 

to have preclusive effect. Skilstaf, 669 F.3d at 1021–25; 

Reyn’s Pasta, 442 F.3d at 745–47. All the required elements having been met, fairness does not weigh against 

the application of collateral estoppel in this case. In re 

Freeman, 30 F.3d 1459, 1467 (Fed. Cir. 1994). 
REESE v. VERIZON CALIFORNIA 10

CONCLUSION

We have considered each of the parties’ remaining arguments and find them unpersuasive. In view of the 

foregoing, the judgment of the district court is affirmed. 

AFFIRMED 
NOTE: This disposition is nonprecedential. 

United States Court of Appeals 

for the Federal Circuit 

__________________________ 

MORRIS REESE, 

Plaintiff-Appellant, 

v. 

VERIZON CALIFORNIA, INC., 

Defendant-Appellee, 

AND

AT&T CALIFORNIA, 

Defendant-Appellee. 

__________________________ 

2012-1048 

__________________________ 

Appeal from the United States District Court for the 

Central District of California in case no. 11-CV-1934, 

Judge S. James Otero. 

__________________________ 

MOORE, Circuit Judge, dissenting. 

The majority concludes that the language of a stipulation in an earlier case (Reese I) against different parties 

collaterally estops Mr. Reese from bringing his suit. I am 

perplexed by the majority’s claim that the “extent and 

scope of the Stipulation are specific and unambiguous.” 

Maj. Op. at 7. With all due respect, I find that the Stipulation unambiguously supports the opposite view—
REESE v. VERIZON CALIFORNIA 2

namely that the parties intended that collateral estoppel 

would attach to the claims for which final judgment of 

noninfringement on the merits was admitted, but not the 

claims that were dismissed without decision. At a minimum, the Stipulation is ambiguous, and if it is ambiguous, under governing Ninth Circuit law, collateral 

estoppel does not apply. 

The Stipulation distinguishes between claims 1, 7, 13, 

18, 25, and 36 of the ’150 patent which the parties stipulated to final judgment of noninfringement, and claims 23 

and 32 of the ’150 patent which the parties stipulated to 

dismissal only, not final judgment on the merits. Walking 

through the Stipulation, the distinctions are clear. To 

begin, the Stipulation is titled, “Stipulation and Joint 

Motion for Dismissal and Final Judgment”—two separate 

things. The first sentence of the Stipulation explains that 

the parties move for “entry of final judgment of noninfringement by Defendants of certain asserted claims 

and for dismissal of the remaining asserted claims.” J.A. 

157. 

In paragraph 1, the parties stipulate to “final judgment of non-infringement of claims 1, 7, 13, 18, 25, and 36 

of the ’150 patent.” Id. In paragraph 2, the parties stipulate to “dismissal with prejudice of all infringement 

claims and assertions by Plaintiff with respect to claims 

23 and 32 of the ’150 patent.” J.A. 158. Hence, paragraphs 1 and 2 stipulate to different things—entry of final 

judgment on the merits for some claims and dismissal for 

others. There is no decision or stipulation to noninfringement contained in paragraph 2. Never does the 

patentee concede that claims 23 and 32 are not infringed. 

In fact, as all parties agree, the patentee actually won the 

claim construction arguments it made on claims 23 and 

32. (The majority’s suggestion that Mr. Reese “simply 

stopped after an adverse claim construction ruling in a 
3 REESE v. VERIZON CALIFORNIA

prior case,” Maj. Op. at 7, is incorrect with regard to 

claims 23 and 32.) 

In paragraph 4, upon which the majority’s collateral 

estoppel decision largely rests, the Stipulation says: 

As this stipulation resolves all claims and counterclaims, the Parties stipulate to entry of final 

judgment. The Parties stipulate that the entry of 

final judgment resulting from this stipulation 

shall constitute a final judgment on the merits of 

Plaintiff’s claims for purposes of res judicata, collateral estoppel, issue preclusion and claim preclusion. 

J.A. 158. This paragraph unambiguously results in 

collateral estoppel with regard to the claims upon which 

final judgment on the merits is entered. It clearly and 

unambiguously says so. But what it does not say is that 

the parties stipulate that collateral estoppel will bar 

future cases involving the claims that were dismissed. 

Claims 23 and 32 were dismissed—this is not disputed. 

Paragraph 4 is silent as to the dismissed claims. By its 

clear language it applies only to the claims upon which 

the parties stipulate to judgment on the merits. Final 

judgment on the merits is not entered upon the dismissed 

claims. 

The Final Judgment in Reese I reinforces this distinction: 

IT IS ORDERED that Plaintiff’s claims for infringement of claims 23 and 32 of U.S. Patent No. 

6,858,150 (the ’150 patent) are DISMISSED 

WITH PREJUDICE; 

IT IS FURTHER ORDERED that, based upon 

the claim construction issued by this Court on 

September 24, 2008, claims 1, 7, 13, 18, 25 and 36 
REESE v. VERIZON CALIFORNIA 4

of the ’150 patent are found to be NOT 

INFRINGED by Defendants and for that reason, 

judgment is entered against Plaintiff on those 

claims. 

J.A. 166 (emphasis in Final Judgment). The court did not 

order any judgment on the merits for claims 23 and 32. 

With regard to claims 23 and 32, the order did not reference the claim construction or make any determinations 

regarding infringement. I simply do not understand from 

these straightforward documents how the majority could 

fail to recognize the distinction between claims 1, 7, 13, 

18, 25, and 36 on the one hand and claims 23 and 32 on 

the other. 

If there was ambiguity in paragraph 4 with regard to 

which claims collateral estoppel attaches, we cannot 

affirm. Ninth Circuit law is clear that for a stipulated 

judgment to give rise to claim preclusion, the language of 

the Stipulation must unambiguously evince the parties’ 

intent for it to have that effect. See Foster v. Hallco Mfg. 

Co., 947 F.2d 469, 481 (Fed. Cir. 1991) (applying Ninth 

Circuit law that courts should avoid “speculat[ing] as to 

the intent of the parties based on broad, general and 

ambiguous language”); Sekaquapetwa v. MacDonald, 575 

F.2d 239, 246 (9th Cir. 1978) (holding that the default 

rule is that “an issue is not deemed to be actually litigated 

if it is the subject of a stipulation between parties”) (internal quotation mark omitted); see also Arizona v. California, 530 U.S. 392, 414 (2000).1 Paragraph 4 clearly 

applies to the claims upon which final judgment of noninfringement on the merits was entered; but that paragraph 

equally clearly does not evidence an intent to agree to 

 1 Yachts America, Inc. v. United States, 673 F.2d 

356 (Ct. Cl. 1982), a case relied upon by the majority, does 

not apply Ninth Circuit law. 
5 REESE v. VERIZON CALIFORNIA

collateral estoppel of the claims that were dismissed 

without judgment. 

Finally, I do not understand why the majority places 

the burden on Mr. Reese “to show that the parties . . . did 

not intend for their stipulated judgment to have any 

preclusive effect on the issue of infringement.” Maj. Opp. 

at 8. Ninth Circuit law makes clear that “[t]he party 

asserting preclusion bears the burden of showing with 

clarity and certainty what was determined by the prior 

judgment.” Hydraunautics v. Filmtec Corp., 204 F.3d 880, 

885 (9th Cir. 2000) (quoting Offshore Sportswear, Inc. v. 

Vuarnet Int’l, B.V., 114 F.3d 848, 850 (9th Cir. 1997)). 

The majority’s burden-shifting is especially odd given that 

we must construe all factual allegations in the complaint 

in the light most favorable to the nonmoving party, Mr. 

Reese. See Skilstaf, Inc. v. CVS Caremark Corp., 669 F.3d 

1005, 1014 (9th Cir. 2012). 

The Stipulation is clear. The judgment is clear. The 

parties intended collateral estoppel to apply to the claims 

upon which judgment of noninfringement was entered, 

not the dismissed claims. The district court thus erred by 

dismissing Mr. Reese’s complaint, and I would reverse.