Document: 347 U.S. 89 74 S.Ct. 414 98 L.Ed. 532 PARTMAR CORP. et al.v.PARAMOUNT PICTURES THEATRES al. No. 17. Argued Oct. 13, 1953. Decided Feb. 8, 1954. Rehearing Denied March 15, See 931, 527. [The balance of this page left blank] Mr. Russell Hardy, Washington, D.C., for petitioners. Jackson W. Chance, Los Angeles, Cal., respondents. Justice REED delivered the opinion Court. 1 This case presents a matter federal practice involving inconsistent positions by litigants in court proceedings. We have often held that under doctrine res judicata judgment entered an action conclusively settles as to all matters were or might been litigated adjudged therein.1 But prior between parties has operate estoppel suit on cause different from forming basis original 'only those issue points controverted, upon determination which finding verdict was rendered.'2 latter aspect is collateral judgment, established procedure carrying out public policy avoiding repetitious litigation. 2 Petitioners counterclaims against them respondent. These dismissed trial petitioners and The stated petitioners' based controverted personal right had not therefore no bar claimed recovery. Respondent, however, its raised issue, determinative action, therein successfully final merits. Collateral stands further litigation be counterclaims. Petitioners' argument dismissal denied hearing issues but determined merits moved us grant certiorari, limited 345 963, 73 948, 97 1382. 3 Although jurisdiction sought only ground diversity, complaint relied breach Sherman Act, similarly bottomed law. Therefore our conclusion reached consideration law procedure. It will depend whether any fact remained decision after primary decided.3 reaches following circumstances. 4 Paramount Pictures Theatres Corp., subsidiary Productions, Inc., successor Pictures, New York corporation engaged business operating motion picture theatres throughout United States. three corporations hereinafter referred jointly 'Paramount.' On August 31, 1939, leased Downtown Theatre California, ten years Partmar California corporation, petitioner here, wholly owned Fanchon & Marco, Inc. lease subsequently amended 1942 extended 18, 1952. A 'film franchise agreement' executed conjunction with, same period as, lease. licensed exhibit pictures at theatre first 'runs' films, required such less than forty-six weeks each year, set scale license fees. expressly provided it terminable option if agreement 'be cancelled terminated reason whatsoever.' Other provisions are germane before 5 December 1946, decree District Court Southern equity brought States other major companies industry alleging conspiracy violate 26 Stat. 209, 15 U.S.C. §§ 1—2, U.S.C.A. 1—2. v. 70 F.Supp. 53. One provision defined 'franchise' licensing 'in effect more one season covering exhibition released distributor during entire enjoined defendants 'from performing existing party making franchises future.' 73, Decree, § II, 5. 6 26, 1947, notified cancelling terminating because injunction, April 2, termination agreement. refused vacate demand, instituted May 1, diversity unlawful detainer theatre. sought, so far material restitution possession illegality Act construed York, supra, declaratory properly terminated. 7 answered setting up various defenses filed seeking treble damages 38 731, resulting violation Act. alleged resulted imposition excessive terms conditions agreement.4 8 By order dated 1948, Court, Paramount's motion, ordered causes tried separately Partmar's Prior 3, we handed down defendants' appeals York. 334 131, 68 915, 92 1260. inter alia 'we cannot say record illegal per se when circuit how small' aside Court's findings relative franchises. 156, 928, Relying them. Their went without amendment pleadings November 1950, two issues: justified case, supra; contract contracts antitrust statutes justifying repossession See, e.g., Glos McBride, 47 Cal.App. 688, 191 P. 67. Thus joined legality actions co-conspirators agreement, apart anomalous position attempting prove agreements with violated laws. did limit contention nonconspiratorial aspects laws, argued way possession. That recognized clearly shown statement brief 'after reversal (in case), plaintiff (Paramount) took question presented violative decisions Supreme Courts.' vigorously contended 'first-run' exhibitions would result that: 9 'There allegation proof conspiracy. There being showing interstate commerce, immaterial there conspiracy, unreasonable clearance, fixed admission prices, block booking, restraint. In absence else entirely beyond purview But, assuming failure equally fatal. Probably evidence Y. Frank Freeman, witness Paramount, conspiratorial arrangements Fox West Coast. * Even doubtful unlawful. neither system, made holding dominant position, pursuant *.' 10 thus insisted remunerative still valid subsisting, 11 After eighteen days Judge 1951, memorandum opinion, 552, 555, he concluded 'for reason' clause meant 'legal substantial reason,' 1946 'was legal agreement.' He continued, 'there indicate third conspired either bring into existence agreement', 'a single film company exhibitor Act', that, since 'not itself 'had cancel terminate illegality.' hold 'as find part counter-claimant recover' counts directed submit proposed fact, both submitted conclusions, hearing, notice, June 1951. thereupon Finding 20 11, infra, formalizing denying plaintiff's petition estopped defendant recovering At appeared objected adoption damage Argument heard objection, adhered adopted among provides: 12 'Paramount, studio, gave first-run feature City Angeles. Neither said nor lease, constituted of, they combination kind whatsoever person persons, persons.' And 13 'Inasmuch amendments respects lawful performed plaintiffs, defendants, persons; inasmuch thereto purpose restraining monopolizing trade commerce several states production, distribution, transportation, sale pictures; solely plaintiffs dealing Angeles alone thereat; them, recover first, second fourth counterclaim, them.'5 14 simultaneously giving detainer, declaring rights duties dismissing prejudice Partmar, apparently wishing jeopardize valuable franchise, appeal parts subsisting unlawfully detained.6 must accepted binding parties. did, serve timely notice Appeals Ninth Circuit much Circuit, curiam 16, 1952, 200 F.2d 561, noted affirmed judgment. As heretofore indicated, 'limited counterclaims.' 16 contends erred separate their merits, previously ordered, deprived due process particular, argues property having admitted 1260, which, argues, provide, Clayton prima facie based. think these contentions merit. power until entry his aside, appropriate reasons, former 17 Each predicated allegations restraint allegedly 'excessive terms, charges photo-plays them' exaction fifty percent net receipts, imposed found principal appealed us, 'of Of course, apply. obviously necessary court's illegal. ample opportunity present contest finding, findings. parties, key ingredient contrary precluded recovery claims. improper disposition counterclaims—whether product conspiracy.7 18 counterclaim charge 'the complaint' damaged Paramount. Yet very sustained dismiss become moot demonstrated non-existence basic fact,' i.e., court, clearly. 19 'The seems se, is, least indicated theatre, like involved case. involved.' 21 Nor unlimited aided Partmar. reversed pertaining exhibitors producers, consent 4, 1949, contains subject. Cf. 85 881, 897. Since judgments decrees Government admissible actually adjudication,8 provide indispensable element counterclaims, From overturn proceeding tainted therefore, prejudiced consider pointed out, lawfulness 'franchise,' distinguished secured 419, supra. considered nonetheless law, another arising controversy claim.9 22 Affirmed. 23 JACKSON CLARK 24 Chief WARREN, whom BLACK joins, dissenting. 25 I join decision. estoppel, affirms judge's petitioner's trial. doctrine, believe, inapplicable facts correctly wellsettled rule conclusive questions action.1 inquiry, eviction suit; litigated, preclude rests assumptions (1) (2) event full litigate issue. assumption, me, warranted facts. To now turn. 27 respondent, take advantage own laws bringing tenant, petitioner, if, whatsoever,' should 'cancelled terminated.' charging allege respect invalid conspiracy; rather, crux others. 66 323, filed, reviewed here; nationwide portion se. 155—156, Petitioner dismiss, contending swept away opposing about-face urged grounds: minimum price requirements, restrictions runs clearances. independent rendered 'contract trade' new theory change pleadings, denied. 28 answer, defense evict pursuance drive enable extend monopoly over theatres. stricken attack lessor 29 answer also contained others named cross-defendants market control able exact profits form overcharges rentals. Treble injunctive relief sought. laws.2 30 Both actions—the counterclaims—were then ready separately. consented first. 31 Throughout lengthy suit, judge repeatedly complained total His unheeded. burden failed introduce never even Petitioner, hand, invalid.3 times inject prevented doing so. already noted, stricken. Later offered subject features decree, 'should go document toto—no whole thing.' support Act4 action. Again overruled. 32 trial, show stated:5 33 'At time agreed counter-claims postponed main counter-claims.' 34 Nevertheless, '* *.'6 disposed ground—the 35 unwarranted. litigated; fair Indeed, do estoppel. If barred sweeping judicata. where neglected significance.7 36 Under circumstances, invoked counterclaims? believe not. presupposes, Constitution requires, who day point failed. Surely intended estop hearing. 37 That, see it, precisely situation here. severed purposes. During justification proving Because proof, valid, shortcoming proof. affirms. penalize refusing help win suit. instructions hear counterclaims.8 Cromwell Sac County, 94 351, 352, 195; Fayerweather Ritch, 195 276, 300, 308, 58, 64, 68, 49 193; Gunter Atlantic Coast Line R. Co., 273, 290, 252, 258, 50 477; Stoll Gottlieb, 305 165, 59 134, 83 104. County Sac, 353, Moser, 266 236, 241, 45 66, 67, 69 262; Treinies Sunshine Mining 308 74, 60 44, 48, 84 85; Commissioner Internal Revenue Sunnen, 333 591, 597—601, 715, 719, 721, 898. Federal Trade Commission Cement Institute, 683, 706, 793, 806, 1009, application differed. Scott, Estoppel Judgment, 56 Harv.L.Rev. 1; Note 52 Col.L.Rev. 647. Petitioner's alleged: 'Paramount Corporation, Film Distributing America Equity 87—273, persons unknown, were, acts transactions herein, are, States, distribution pictures, July 1890, say, '32. aforesaid agreements, evade defeat end instituted. '33. third-party arranged themselves, require Corporation 46 photoplays and, obey requirement, Theatre. plaintiff, impose, imposed, exhibited Theatre, 1933, time.' (petitioners) reiterated claim addition 'to pay additional sum; cent receipts Theatre.' briefs substantially numbers two. Fed.Rules Civ.Proc. 14, presence important phase controversy. While appeal, have. just quoted essential prevailing may does cited Lindheimer Illinois Bell Telephone 292 151, 176, 54 658, 668, 78 1182. Co. Maltbie, 291 645, 443, 1041, cases cited. Electrical Fittings Corp. Thomas Betts 307 860, 1263, negatively. 'A decree.' Professor note 12, concurs view. Restatement, Judgments, reads: '(1) Where subsequent except 69, 71 72.' Section 69(2) ('Where obtain appellate him moot, action.') claim. Galloway General Motors Acceptance Cir., 106 466. paucity field explainable infrequent happening need favor. Pacific 168 48 49, 27, 42 355: general principle announced numerous right, question, distinctly put directly competent jurisdiction, recovery, disputed privies; once must, privies, taken established, long remains unmodified.' Emich 340 558, 568—569, 408, 413—414, 95 534: 'We Congress confer, defendant's enjoyment party, large afford evidentiary use conviction respondents reference Accordingly, entitled establish necessarily decided based.' Enterprises 346 537, 257; Monticello Tobacco American 197 629. 242, 262: government apply law; sense, true. unmixed Where, example, deciding enunciated demand insisting otherwise, merely cases. though erroneous view law.' 569, 414, 534; Stone Downer 274 225, 230, 616, 1013. 195. 68; 2—3, 5—6; Note, Estoppel, 647, 652—657; Developments Law, Res Judicata, 65 818, 840—841; Von Moschzisker, Yale L.J. 299, 311—312; Cleary, Judicata Re-examined, 57 339, 342—343; Judgments (5th ed.) 674—676. 15. statements commerce. difficult understand can converted litigated. amounted nothing justifiable conspiracy—by evidence, oral argument. 16. 561. Ibid. yet applying successful could 1182; 1041. adverse included 1263. inability bind 69(2); 15—18. (footnote 6) concedes precludes here (as conspiracy) cites other, inserted decree. overlooks holdings relies support. utility related value rate-making purposes; rates state commission confiscatory utility, 'material' review Maltbie.

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