Source: https://casetext.com/case/lawlor-v-national-screen-service
Timestamp: 2020-07-04 22:33:20
Document Index: 670176700

Matched Legal Cases: ['§ 47', '§ 62', '§ 26', '§ 62', '§ 83', '§ 94']

Lawlor v. Nat'l Screen Serv., 349 U.S. 322 | Casetext Search + Citator
Lawlor v. Nat'l Screen Serv.
Bronson v. Bd. of Ed., Etc.
The authorities that Judge Lively relied upon in the context of his discussion of the post-1965 plaintiffs…
Taylor v. Norfolk S. Ry. Co.
Id. at 315 n. 5 (citing Federated Dep't Stores, Inc. v. Moitie, 452 U.S. 394, 398, 101 S.Ct. 2424, 69 L.Ed.2d…
787 Citing Cases
Full title:LAWLOR ET AL., TRADING AS INDEPENDENT POSTER EXCHANGE, v . NATIONAL SCREEN…
Date published: Jun 6, 1955
349 U.S. 322 (1955)
75 S. Ct. 865
holding that two suits were not "based on the same cause of action," because "[t]he conduct presently complained of was all subsequent to" the prior judgment and 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"
Summary of this case from Lucky Brand Dungarees, Inc. v. Marcel Fashions Group, Inc.
Argued February 9-10, 1955. Decided June 6, 1955.
In 1942, alleging that the defendants had conspired to establish a monopoly in the distribution of motion picture advertising material, petitioners and others brought an antitrust action for treble damages and injunctive relief against National Screen and three motion picture producers who had granted exclusive licenses to National Screen to manufacture and lease such material. In 1943, pursuant to a settlement made before trial and without any findings of fact or law having been made, that action was dismissed "with prejudice" and sublicenses were granted by National Screen to the plaintiffs. In 1949, petitioners brought a similar action against the same defendants, plus five additional motion picture producers, alleging that settlement of the 1942 suit was merely a device used to perpetuate the conspiracy and monopoly, that the five additional producers had since joined the conspiracy, and that National Screen had deliberately made slow and erratic deliveries under the sublicense in an effort to destroy petitioners' business and had used tie-in sales and other means of exploiting its monopoly power. Petitioners sought damages for only those injuries sustained after the 1943 judgment. Held: The 1949 action was not barred by the 1943 judgment under the doctrine of res judicata. Pp. 323-330.
(a) Since the 1943 judgment was not accompanied by findings, it did not bind the parties on any issue — such as the legality of the exclusive license agreements or their effect on petitioners' business — which might arise in connection with another cause of action. Pp. 326-327.
(b) Whether the defendants' conduct be regarded as a series of individual torts or as one continuing tort, the two suits were not based on the same cause of action, and the 1943 judgment does not bar the 1949 suit. Pp. 327-328.
(c) A different result is not required by the fact that the 1942 complaint sought, in addition to treble damages, injunctive relief which, if granted, would have prevented the illegal acts now complained of. Pp. 328-329.
(d) With respect to the five defendants who were not parties to the 1942 suit, moreover, their relationship to the other defendants was not close enough to bring them within the scope of the doctrine of res judicata. Pp. 329-330.
211 F.2d 934, reversed.
Francis Anderson argued the cause and filed a brief for petitioners.
Louis Nizer argued the cause and filed a brief for the National Screen Service Corporation, respondent.
Earl G. Harrison argued the cause for the Columbia Pictures Corporation et al., respondents. With him on the brief were Wm. A. Schnader and Edward W. Mullinix for Loew's Incorporated et al., and Louis J. Goffman for Warner Bros. Pictures Distributing Corporation, respondents.
Petitioners are engaged in the business of leasing advertising posters to motion picture exhibitors in the Philadelphia area. Such posters, known in the trade as standard accessories, embody copyrighted matter from the motion pictures being advertised. Until recent years, standard accessories could be purchased directly from the motion picture companies themselves. Beginning with Paramount in 1939, however, the eight major producers granted to National Screen Service Corporation the exclusive right to manufacture and distribute various advertising materials, including standard accessories as well as specialty accessories and film trailers, for their motion pictures. RKO followed in 1940, Loew's in 1942, Universal in 1944, Columbia in 1945, United Artists and Warner Brothers in 1946, and 20th Century Fox in 1947.
In 1942, together with a number of others in similar businesses, petitioners commenced a treble-damage antitrust action against National Screen and the three producers who had already granted exclusive licenses to National Screen. The complaint alleged that the defendants had conspired to establish a monopoly in the distribution of standard accessories by means of the exclusive licenses and that the plaintiffs' businesses had been injured as a consequence. The complaint also alleged that National Screen was then negotiating with the other major producers to procure similar licenses. In addition to damages, an injunction was sought against the defendants' "illegal acts and practices."
In 1943, prior to any trial, the suit was settled. The basis of the settlement was an agreement by National Screen to furnish the plaintiffs with all standard accessories distributed by National Screen pursuant to its exclusive license agreements with producers, including exclusive license agreements which might be executed in the future. In exchange, the plaintiffs agreed that they would withdraw the suit and that they would pay National Screen for the materials at specified prices. Pursuant to the settlement, the suit was dismissed "with prejudice" by court order. No findings of fact or law were made.
The sublicense was to run three years. In 1946 it was renewed for another five-year term. In 1949, while the sublicense was still in force, petitioners brought the instant action, again seeking treble damages and injunctive relief. Named as defendants — respondents here — were National Screen, the three producers who were parties to the 1942 suit, and the five producers who licensed National Screen subsequent to the dismissal of the 1942 suit.
In their present complaint, petitioners allege that the settlement of the 1942 suit was merely a device used by the defendants in that case to perpetuate their conspiracy and monopoly. They also allege: that five other producers have joined the conspiracy since 1943; that National Screen has deliberately made slow and erratic deliveries of advertising materials under the sublicense in an effort to destroy petitioners' business; and that for the same purpose National Screen has used tie-in sales and other means of exploiting its monopoly power. Petitioners seek damages for resulting injuries suffered from August 16, 1943 — in other words, for a period beginning several months after the dismissal of the 1942 complaint.
"Defendant NATIONAL, illegally and with intent to destroy plaintiff's business, deliberately reduces the rental price of said motion picture talking trailers to exhibitors if said exhibitors, including plaintiff's customers, agree beforehand to purchase or lease for the exploitation of all of their films exhibited, standard accessories and advertising materials directly from the defendant NATIONAL."
In 1951, on petitioners' motion for summary judgment, the District Court held that petitioners were entitled to injunctive relief against National Screen because the undisputed facts supported petitioners' claim of unlawful monopoly. As to the producers, however, the District Court held that conflicting evidence on the issue of conspiracy made a trial necessary. But in 1953, before any trial was held and before a decree against National Screen could be framed, the defendants moved to dismiss the action on the ground that the 1943 judgment was res judicata. The District Court, another judge then sitting, granted the motion and the Court of Appeals for the Third Circuit affirmed. We granted certiorari because of the importance of the question thus presented in the enforcement of the federal antitrust laws.
99 F. Supp. 180, 188.
348 U.S. 810.
The basic distinction between the doctrines of res judicata and collateral estoppel, as those terms are used in this case, has frequently been emphasized. Thus, under the doctrine of res judicata, a judgment "on the merits" in a prior suit involving the same parties or their privies bars a second suit based on the same cause of action. Under the doctrine of collateral estoppel, on the other hand, such a judgment precludes relitigation of issues actually litigated and determined in the prior suit, regardless of whether it was based on the same cause of action as the second suit. Recognizing this distinction, the court below concluded that "No question of collateral estoppel by the former judgment is involved because the case was never tried and there was not, therefore, such finding of fact which will preclude the parties to that litigation from questioning the finding thereafter." Turning then to the doctrine of res judicata, the court correctly stated the question before it as "whether the plaintiffs in the present suit are suing upon the `same cause of action' as that upon which they sued in 1942 and lost." The court answered the question in the affirmative on the ground that the two suits were based on "essentially the same course of wrongful conduct." The court acknowledged that "there are some additional allegations, some new acts which the plaintiffs say the defendants have done since the earlier suit" and that "Additional defendants were joined in the 1949 suit," but concluded that "in substance the complaint is the same. . . ."
E. g., Cromwell v. County of Sac, 94 U.S. 351, 352-353; United States v. Moser, 266 U.S. 236, 241. See also Restatement, Judgments, §§ 47, 48, 68. The term res judicata is used broadly in the Restatement to cover merger, bar, collateral estoppel, and direct estoppel. Id., c. 3, Introductory Note.
Id., at 936.
Id., at 936-937.
It is of course true that the 1943 judgment dismissing the previous suit "with prejudice" bars a later suit on the same cause of action. It is likewise true that the judgment was unaccompanied by findings and hence did not bind the parties on any issue — such as the legality of the exclusive license agreements or their effect on petitioners' business — which might arise in connection with another cause of action. To this extent we are in accord with the decision below. We believe, however, that the court erred in concluding that the 1942 and 1949 suits were based on the same cause of action.
United States v. Parker, 120 U.S. 89, 95; United States v. International Building Co., 345 U.S. 502, 506.
See United States v. International Building Co., supra, at 505: "We conclude that the decisions entered by the Tax Court for the years 1933, 1938, and 1939 were only a pro forma acceptance by the Tax Court of an agreement between the parties to settle their controversy for reasons undisclosed. There is no showing either in the record or by extrinsic evidence (see Russell v. Place, 94 U.S. 606, 608) that the issues raised by the pleadings were submitted to the Tax Court for determination or determined by that court. They may or may not have been agreed upon by the parties. Perhaps, as the Court of Appeals inferred, the parties did agree on the basis for depreciation. Perhaps the settlement was made for a different reason, for some exigency arising out of the bankruptcy proceeding. As the case reaches us, we are unable to tell whether the agreement of the parties was based on the merits or on some collateral consideration."
That both suits involved "essentially the same course of wrongful conduct" is not decisive. Such a course of conduct — for example, an abatable nuisance — may frequently give rise to more than a single cause of action. And so it is here. The conduct presently complained of was all subsequent to the 1943 judgment. In addition, there are new antitrust violations alleged here — deliberately slow deliveries and tie-in sales, among others — not present in the former action. While the 1943 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. In the interim, moreover, there was a substantial change in the scope of the defendants' alleged monopoly; five other producers had granted exclusive licenses to National Screen, with the result that the defendants' control over the market for standard accessories had increased to nearly 100%. Under these circumstances, whether the defendants' conduct be regarded as a series of individual torts or as one continuing tort, the 1943 judgment does not constitute a bar to the instant suit.
Restatement, Judgments, § 62, Comment g. Antitrust violations are expressly made abatable. 15 U.S.C. § 26.
Restatement, Judgments, § 62, Comment g. Compare Federal Trade Commission v. Raladam Co., 316 U.S. 149, 150-151.
99 F. Supp. 180, 183-184. The complaint in the 1942 suit alleged that 40% of National Screen's business in standard accessories consisted of standard accessories for the motion pictures of two (Paramount and RKO) of the three defendant producers. The complaint also alleged that 20% to 33% of the plaintiffs' business consisted of standard accessories for the motion pictures of the third defendant producer (Loew's). As to the pertinence of "the percentage of business controlled," see United States v. Columbia Steel Co., 334 U.S. 495, 527-528.
This conclusion is unaffected by the circumstance that the 1942 complaint sought, in addition to treble damages, injunctive relief which, if granted, would have prevented the illegal acts now complained of. A combination of facts constituting two or more causes of action on the law side of a court does not congeal into a single cause of action merely because equitable relief is also sought. And, as already noted, a prior judgment is res judicata only as to suits involving the same cause of action. There is no merit, therefore, in the respondents' contention that petitioners are precluded by their failure in the 1942 suit to press their demand for injunctive relief. Particularly is this so in view of the public interest in vigilant enforcement of the antitrust laws through the instrumentality of the private treble-damage action. Acceptance of the respondents' novel contention would in effect confer on them a partial immunity from civil liability for future violations. Such a result is consistent with neither the antitrust laws nor the doctrine of res judicata.
With respect to the five defendants who were not parties to the 1942 suit, there is yet a second ground for our decision. The court below held that their relationship to the other defendants was "close enough to bring them all within the scope of the doctrine of res judicata." With this conclusion, we cannot agree. We need not stop to consider the outer bounds of the rule of privity and allied concepts. It is sufficient here to point out that the five defendants do not fall within the orthodox categories of privies; that they could not have been joined in the 1942 case since they did not even enter the alleged conspiracy until after the judgment on which they now rely; that in any event there was no obligation to join them in the 1942 case since as joint tortfeasors they were not indispensable parties; and that their liability was not "altogether dependent upon the culpability" of the defendants in the 1942 suit.
Restatement, Judgments, § 83, Comment a: "those who control an action although not parties to it . . .; those whose interests are represented by a party to the action . . .; successors in interest . . . ."
Compare Bruszewski v. United States, 181 F.2d 419 (C.A. 3d Cir.), on which both courts below relied. It should also be noted that the Bruszewski decision was an application of collateral estoppel and not res judicata as that term is used here.
Restatement, Judgments, § 94. See Bigelow v. Old Dominion Copper Co., 225 U.S. 111, 132.
Id., at 127.
holding that antitrust violations that continued after the settlement of the first lawsuit were new causes of action not barred by res judicata even though "both suits involved ‘essentially the same course of wrongful conduct’ "
Summary of this case from Retractable Techs., Inc. v. Becton Dickinson & Co.
holding that joinder of alleged antitrust coconspirators was not mandatory “since as joint tort-feasors they were not indispensable parties”
Summary of this case from Ward v. Apple Inc.
holding that judgment dismissing previous suit unaccompanied by findings did not bind the parties on any issue
Summary of this case from Amadeo v. Principal Mut. Life Ins. Co.
holding that while a judgment may preclude 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"
Summary of this case from Phelps v. Hamilton
holding that judgment dismissing prior suit "with prejudice" that was unaccompanied by findings did not constitute issue preclusion
Summary of this case from Deferio v. Bd. of Tr. of the State Univ. of N.Y.
Summary of this case from Invisible Fence, Inc. v. Fido's Fences, Inc.
holding that claim preclusion did not bar claims that arose after judgment was entered in prior action and stating that "[w]hile [a prior] 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"
Summary of this case from Burroughs Payment Sys., Inc. v. Symco Grp., Inc.
holding that while a prior "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"
Summary of this case from Murray v. Burt
holding that res judicata does not bar litigation of similar claims based on events that occurred subsequent to a prior judgment
Summary of this case from Chudacoff v. University Medical Center of Southern Nevada
holding that a prior settlement of an antitrust conspiracy case and the resulting judgment dismissing the suit with prejudice could not have res judicata effect in a later suit against additional parties in which the plaintiffs alleged claims based on new types of antitrust violations that were not contemplated by the earlier settlement when it would have the effect of conferring on defendants partial immunity from civil liability for distinct future antitrust violations
Summary of this case from Xerox Corporation v. Media Sciences, Inc.
holding that a prior lawsuit cannot preclude a later lawsuit when the second suit is based on actions that occurred after the judgment in the prior action, even if the cases are closely related
Summary of this case from Sierra Club v. City County of Honolulu
holding that where parties entered into a settlement agreement and court's judgment, dismissing case with prejudice, was not accompanied by findings of fact, collateral estoppel did not preclude further litigation of issues.
Summary of this case from Marvel Characters Inc. v. Simon
concluding that claim preclusion did not apply to a patent infringement action asserting claims accruing after the first infringement action was settled
Summary of this case from Boehm v. Svehla
concluding there was “no question of collateral estoppel ... because the case was never tried” and instead settled
Summary of this case from Edison Learning, Inc. v. Sch. Dist. of Phila.
reversing Third Circuit's decision on other grounds
Summary of this case from In re Barrow
recognizing that a previously existing actionable claim or judgment "cannot be given the effect of extinguishing claims which did not even then exist"
recognizing that a second suit regarding the same course of wrongful conduct as a previously decided suit is not barred by claim preclusion principles when the violations alleged in the second suit had not occurred when the first suit was filed
Summary of this case from Kamedula v. Hultenschmidt
explaining that although an earlier 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"
Summary of this case from Bennett v. Garner
In Lawlor, the Supreme Court instructed that a prior judgment "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."
Summary of this case from Mentor Graphics Corp. v. Eve-USA, Inc.
noting that such a policy "would in effect confer on [defendants] a partial immunity from civil liability for future violations"
Summary of this case from Pram Nguyen ex rel. United States v. City of Cleveland
In Lawlor, an action was brought to recover treble damages for alleged violations of federal antitrust laws. Lawlor, 349 U.S. at 323, 75 S.Ct. 865. A previous suit had been settled and dismissed with prejudice.
Summary of this case from Banks v. Unternational Union Electronic
noting that the same "course of conduct . . . may frequently give rise to more than a single cause of action"
Summary of this case from Perez v. Danbury Hosp
noting that "the conduct presently complained of was all subsequent to the [prior] judgment"
Summary of this case from Storey v. Cello Holdings, L.L.C
stating prior dismissal of antitrust complaint did not bar new antitrust complaint based on conduct occurring after the first judgment
Summary of this case from Ammex, Inc. v. U.S.