IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

GLENAYRE ELECTRONICS, INC.,

 Plaintiff,

v.

PHILIP JACKSON, an individual,

 Defendant.

PHILIP JACKSON,

 Counterclaim-Plaintiff,

v.

GLENAYRE ELECTRONICS, INC.,

 Counterclaim-Defendant.

Case No. 02 CV 0256

 Hon. Harry D. Leinenweber

MEMORANDUM OPINION AND ORDER

In 2002, Glenayre Electronics, Inc. (hereinafter, “Glenayre”)

brought an action (hereinafter, “the 2002 action”) against Philip

Jackson (hereinafter, “Jackson”) seeking a declaratory judgment that

its products did not infringe on a patent owned by Jackson. Jackson

brought a Counterclaim for both indirect and direct infringement. A

jury returned a verdict for Jackson on the direct infringement claim.

Now, Jackson has sued his attorneys, Mr. Niro and the firm of Niro,

Scavone, Haller & Niro (collectively, hereinafter, “the Niro firm”)

in state court for malpractice in connection with the 2002 action.
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The Niro firm has moved to enjoin Jackson from making certain

arguments in the malpractice action.

I. BACKGROUND

Following trial, the jury in the 2002 action found for Jackson

and awarded him $12.1 million in damages for the direct infringement

of his patent. Jackson accepted a remittitur which left the sum at

$2.65 million, but this Court then ruled that acceptance of the

remittitur prevented him from pursuing claims against Glenayre for

indirect infringement. Specifically, this Court held (and the

Federal Circuit affirmed) that Jackson was “completely compensated”

by the remittitur for Glenayre’s infringement.

Prior to this suit, Jackson had sued certain of Glenayre’s

customers for patent infringement. These claims were stayed pending

resolution of the direct infringement alleged against Glenayre.

Jackson has not sought to have these stays lifted.

In 2006, Jackson filed a five-count complaint in state court

alleging negligence, failure to provide an accounting, and

malpractice in the 2002 action. Within the two counts of

malpractice, Jackson makes the following allegations: (a) that the

Niro firm advised Jackson to seek a claim of damages against Glenayre

rather than an injunction or declaratory judgment, thereby putting

into jeopardy Jackson’s potential claims against Glenayre customers;

(b) that the Niro firm advised Jackson to withdraw an interlocutory

appeal protesting the bifurcation (and stays) of Jackson’s claims

against Glenayre customers; © that the Niro firm failed to adequately
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supervise an expert to ensure that the expert’s testimony would be

admissible; and (d) that the Niro firm advised Jackson to accept the

remittitur, thereby leading this Court to hold that Jackson had been

fully compensated. 

The Niro firm has attempted to dismiss Jackson’s malpractice

claims based on the doctrine of collateral estoppel. The state court

held that the arguments that Jackson is pursuing in the malpractice

action were not litigated in this Court and therefore are not barred

by collateral estoppel. Now, the Niro firm asks that this Court

enjoin Jackson from making assertions that contradict this Court’s

alleged judgment that the $2.65 million after remittitur represented

all possible damages in the infringement case (this precludes Jackson

from arguing that had the Niro firm not advised him to accept the

remittitur, he could have obtained a more favorable verdict in a

second damages trial). Additionally, the Niro firm asks that this

Court enjoin Jackson from arguing that he could have brought lawsuits

against Glenayre’s customers because this Court enjoined such claims.

Before addressing the issues before the Court, it is important

to point out what issues are not before this Court. Specifically,

Jackson’s substantive allegations of malpractice are not at issue

here. This Court has ignored portions of the parties’ briefs devoted

to the malpractice issue.

II. AUTHORITY

A federal court’s ability to enjoin state court actions stems

from two related acts, the Anti-Injunction Act and the All Writs Act.
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See 28 U.S.C. § 2283; 28 U.S.C. § 1651(a). The All Writs Act permits

“all courts established by Act of Congress . . . [to] issue all writs

necessary and appropriate in aid of their respective jurisdictions

and agreeable to the usages and principles of law.” 28 U.S.C.

§ 1651(a). The Anti-Injunction Act generally prohibits a federal

court from enjoining or staying proceedings in a state court except

where a delineated exception applies. 28 U.S.C. § 2283; In re

Prudential Ins. Co. of America Sales Practice Litigation, 261 F.3d

355, 365 (3d Cir. 2001); Carlough v. Amchem Products, Inc., 10 F.3d

189, 201 n.9 (3d Cir. 1993). The Act was designed to prevent

friction between state and federal courts and to protect state court

proceedings from federal interference. Amalgamated Clothing Workers

of America v. Richman Bros., 348 U.S. 511, 514-16 (1955). The

“relitigation exception” specifically permits federal courts to

enjoin a state court’s relitigation of a matter previously determined

by the federal court. 28 U.S.C. § 2283 (exception where federal

court seeks to “protect or effectuate its judgments”); Samuel C.

Ennis & Co., Inc. v. Woodmar Realty Co., 542 F.2d 45, 49 (7th Cir.

1976); see also 28 U.S.C. § 2283, Revisor’s Note; 1A, Part 2 J.

Moore, Federal Practice PO.208 [2]-[3] (2d Ed. 1974). The

relitigation exception is “founded in the well-recognized concepts of

res judicata and collateral estoppel. Chick Kam Choo v. Exxon Corp.,

486 U.S. 140, 147-48 (1988). 
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III. JURISDICTION AND STANDING

As an initial matter, this Court must determine that the Court

has jurisdiction over this motion and that the Niro firm has standing

to bring the motion. Jackson appears to concede that jurisdiction

and standing are proper here. Under the Anti-Injunction Act, “no

independent basis of jurisdiction is required for a federal court to

entertain an application to enjoin relitigation in state court.”

Huguley v. General Motors Corp., 999 F.2d 142, 145 (6th Cir. 1993);

see also Mahurkar v. C.R. Bard, Inc., 209 F.Supp.2d 911, 913-14 (N.D.

Ill. 2002). Additionally, the Niro firm has standing to bring the

motion because there is “no prohibition on non-mutual issue

preclusion in the Anti-Injunction Act.” Mahurkar, 209 F.Supp.2d at

913 n.1; see Ennis & Co. v. Woodmar Realty Co., 542 F.2d 45, 49 (7th

Cir. 1976) (affirming injunction entered at request of non-party to

prior lawsuit). 

IV. PRECLUSIVE EFFECT OF THE STATE COURT DECISION

This Court must also decide a second preliminary matter before

determining whether this case falls within the relitigation

exception. Rather than coming first to this Court to request an

injunction, the Niro firm has already requested that the state court

dismiss parts of Jackson’s complaint on the basis of claim

preclusion. In its decision on the motion to dismiss, the state

court held that the doctrine of collateral estoppel did not bar

Jackson’s proposed arguments. The state court believed that this

Court had merely held that “because [Jackson] accepted the award [he]
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could not recover more,” not that this Court had held that Jackson

could not legally be entitled to more damages under any

circumstances. Now, this Court must determine whether it is bound by

the state court’s decision. See Parsons Steel, Inc. v. First Alabama

Bank, 474 U.S. 518 (1986) (federal court must consider the possible

preclusive effect of state court’s res judicata determination under

Full Faith and Credit Act).

Parsons Steel held that the relitigation exception to the AntiInjunction Act is limited by the Full Faith and Credit Act, which

requires that a federal court give a state court’s judgment the same

preclusive effect it would have had in another court of the same

state. Parsons Steel, 474 U.S. at 525-26; Ramsden v. AgriBank, FCB,

214 F.3d 865, 868-69 (7th Cir. 2000). The question is thus whether

an Illinois state court would view the state court’s collateral

estoppel ruling as binding. Id. This question was not briefed by

the parties. Instead, the Niro firm has relied on the Seventh

Circuit’s decision in In re Bridgestone/Firestone, Inc., Tires

Products Liability Litigation, 333 F.3d 763 (2003), which is

inapposite as the state court did not rule on a res judicata issue

before the litigants brought the matter to the district court. 

Under Illinois law, collateral estoppel applies where “(1) the

issue decided in the prior adjudication is identical to the issue

presented in the present suit; (2) a final judgment was entered on

the merits in the prior adjudications; and (3) the party against whom

estoppel is asserted was a party to or in privity with a party to the
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prior adjudication. Graham v. Hildebrand, 203 Fed. Appx. 726, 729

(7th Cir. 2006) (citing Gumma v. White, 833 N.E.2d 834, 843 (Ill.

2005). It appears that the first and third requirements are met.

The question is thus whether the state court’s denial of the Niro

firm’s motion to dismiss is a final judgment on the merits. In order

for a judgment to be final, it must be such that it puts an end to

the litigation or definitely puts the case out of court. Workmen’s

Lumber & Const. Co. v. Martin, 257 N.E.2d 494 (Ill. 1970). Denial of

a motion to dismiss does not put an end to litigation; it is

interlocutory rather than final and appealable. Village of Westmont

v. Lenihan, 704 N.E.2d 891, 894 (Ill. App. 1998). Thus, the state

court action does not bind this Court under the Full Faith and Credit

Act.

V. APPLICATION OF THE RELITIGATION EXCEPTION

Thus, this Court must now consider whether the relitigation

exception applies. The relitigation exception applies where (1) a

federal court has entered judgment and (2) “the claims or issues,

strictly and narrowly defined, enjoined from state litigation

actually have been decided by the district court.” Rutledge v. Scott

Chotin, Inc., 972 F.2d 820 (7th Cir. 1992). A district court may,

under the relitigation exception, enjoin the decision of an issue the

result of which is necessarily dictated by the district court’s prior

decision of another question. Rutledge, 972 F.2d at 925. Any doubts

as to whether the relitigation exception applies must be resolved in

favor of allowing a state court to proceed without interference.
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Merle Norman Cosmetics, Inc. v. Victa, 936 F.2d 466, 468 (9th Cir.

1991). 

In addition to the two requirements above, a litigant must still

show equitable entitlement to an injunction. Ramsden, 214 F.3d at

869. The “mere fact that the case falls within [the relitigation

exception] . . . does not ‘qualify in any way the principles of

equity, comity, and federalism that must restrain a federal court

when asked to enjoin a state court proceeding.’” Id. Thus, “once a

state court considers a res judicata defense and rules that a prior

federal judgment does not actually bar a claim, the affront of

federal court intervention stripping the state court of power to

continue is greatly magnified. After such a ruling, the interests in

preventing possible relitigation are therefore generally outweighed

by the heightened comity concerns except in the most extraordinary

circumstances.” Id. at 870.

Putting aside, for a moment, the first two requirements, this

Court notes that the Niro firm has failed to address the Ramsden

equitable entitlement requirement. The Niro firm argues merely that

a federal judgment has been entered regarding the arguments Jackson

puts forth in the state court and that the state court’s ruling does

not preclude this Court from entering a judgment. The Niro firm has

pointed to no extraordinary circumstances entitling it to an

injunction. Of course, the Niro firm faces the expenses and

uncertainty inherent in litigation, but the Ramsden Court has already

held that this is not a sufficient reason to enter an injunction
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where a state court has already weighed the collateral estoppel

issue. Ramsden, 214 F.3d at 871. The Niro firm still has the

ability to appeal the state court’s final decision through the state

appellate process. See Parsons Steel, 474 U.S. at 525. Thus, this

Court will not enjoin the arguments Jackson seeks to make in the

state court malpractice action.

Even if the Ramsden equitable entitlement were met, this Court

would not issue the injunction requested. In reviewing this Court’s

rulings (as well as the Federal Circuit’s ruling), it is nowhere

clear that this Court held that Jackson would never have been

entitled to damages exceeding $2.65 million, but, that on the

evidence presented, this was all he was entitled to. Instead, the

Court held that after accepting the remittitur, Jackson was entitled

to no more and could not argue that he was.

There remains the Niro firm’s second request – that this Court

enjoin Jackson from asserting that he was entitled to recover from

customers because Jackson has made no attempt to lift injunctions

placed on customer suits by this Court. This Court agrees with the

Niro firm that these customer suits are, at present, enjoined. The

Niro firm apparently did not bring this request first to the state

court, so Ramsden’s concern for the principles of comity are not as

applicable. However, Niro’s argument is essentially that this Court

should enjoin Jackson from arguing that he might have been entitled

to damages from Glenayre’s customers because he has failed to attempt

to lift the injunctions. This appears to this Court to be a fact to
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be considered as a defense to the malpractice action – and not a

justification for an injunction. In fact, the basis cited for the

injunction (that Jackson has failed to attempt to lift the

injunctions on the customer suits) is not even a judgment of this

Court. Thus, this Court will not issue this proposed injunction

either.

VI. CONCLUSION

For the reasons stated herein, the Niro firm’s Motion for

Injunction is denied. 

IT IS SO ORDERED.

Harry D. Leinenweber, Judge

United States District Court

Date: August 30, 2007