Court Opinion

ID: 5110352
Source: CourtListenerOpinion
Date Created: 2021-10-02 14:15:52.336877+00
Date Added: 2024-06-11T08:21:31.056396
License: Public Domain

JULIE DeWOODY GREATHOUSE, Special Justice, concurring. I would reach the same result as the majority on the issue of res judicata but for a different reason. Rather than address the merits of Baptist’s argument that res judicata bars Ap-pellees’ and Intervenor’s claims, the majority holds that Baptist has waived the right to defend on this ground by tacitly agreeing to a split of claims made by Appellees and Intervenors. To support this conclusion, the majority cites to several cases from other jurisdictions. However, these opinions involved situations in which a plaintiff sought to split a single cause of action. See Joseph Mfg. Co. v. Olympic Fire Corp., 986 F.2d 416 (10th Cir.1993) (decided on federal procedural grounds but noting that a state statute mandated that all negligence-based claims be tried in one suit); Todd v. Cent Petroleum Co., 155 Kan. 249, 124 P.2d 704 (1942) (plaintiff divided contractual claims related between two state-court actions based on the time of service rendered); Georgia Ry. & Power v. Endsley, 167 Ga. 439, 145 S.E. 851 (1928) (plaintiff brought separate state-court actions for personal injuries and property damage arising from a single negligent act); Cassidy v. Berkovitz, 169 Ky. 785, 185 S.W. 129 (1916) (plaintiff brought claims for personal injuries and property damage in two state lawsuits although they constituted a single cause of action); Martin v. Frayser, 1999 WL 1678317 (D.Kan. Dec. 28,1999) (decided on federal procedural grounds but noting that federal wrongful-death action and state personal injury suit were likely considered part of the same cause of action under state law). In the case at bar, [ 3SAppellees and Intervenors have never attempted to split individual causes of action. Instead, they divided distinct claims among the state and federal courts — federal antitrust claims were filed in federal court and state tort and statutory claims were filed in state court. As this court has previously recognized: Federal district courts and state courts are separate jurisdictions. Identical cases between the same parties can be pending in each court at the same time. It is the same situation as if identical cases between the same parties were pending in different states. In such a situation the first forum to dispose of the case by trial enters a judgment that is binding on the parties. Carter v. Owens-Ill., Inc., 261 Ark. 728, 729-30, 551 S.W.2d 209, 209-10 (1977). Thus, even if adopted in this state, the claims-splitting rule utilized in other jurisdictions does not affect Baptist’s ability to assert res judicata as a defense to this action. As such, it is necessary to consider the merits of Baptist’s claim-preclusion defense. It is well established that res judicata bars relitigation of a claim if (1) the first suit resulted in a judgment on the merits; (2) the first suit was based on proper jurisdiction; (3) the first suit was fully contested in good faith: (4) both suits involve the same claim or cause of action; and (5) both suits involve the same parties or their privies. Jayel Corp. v. Cochran, 366 Ark. 175, 178, 234 S.W.3d 278, 281 (2006). With respect to the fourth element, this court has previously held that “Mes judicata bars not only the relitigation of claims that were actually litigated in the first suit but also those that could have been litigated.” Id. However, “res judicata ... [is] only applicable when the party against whom the earlier decision is being | .^asserted had a fair and full opportunity to litigate the question in issue.” Cater v. Cater, 311 Ark. 627, 632, 846 S.W.2d 173,176 (1993). Baptist contends that res judicata bars the instant action because there is a presumption that the district court would have exercised its supplemental jurisdiction over Appellees’ and Intervenor’s state-law claims had they been asserted in Appel-lees’ federal antitrust lawsuit. Appellees respond that the state case and the federal case did not involve the same claims or causes of action, and that the federal court would not have exercised supplemental jurisdiction over the state law claims related to the Policy. Baptist did not cite to, nor am I aware of, any case law to demonstrate that such a presumption has been adopted in Arkansas. If such a presumption had been adopted in Arkansas, the authorities cited by Baptist from other jurisdictions explicitly permit rebuttal of the presumption. In Whalen v. United Air Lines, Inc., 851 P.2d 251, 254 (Colo.Ct.App.1993), the court stated that a “plaintiff may be able to demonstrate that the court would decline to exercise its jurisdiction by referring to previous instances in which that court has consistently declined to exercise its discretionary jurisdiction over similar claims.” (“The number of ways in which [the fact that the federal court would have declined jurisdiction] may be demonstrated is limited only by the imagination of counsel.”) Restatement Second of Judgments § 25, illustration 10, cited by Baptist provides another example of when a court might decline jurisdiction: “because the federal claim, though substantial, was dismissed in advance of trial.” Here, it is clear that Appellees’ federal antitrust claims were dismissed | .^pursuant to Rule 12(b)(6) before any trial could be held. Additionally, Appellees have identified a prior opinion in which Judge Holmes declined to exercise supplemental jurisdiction over state-law claims, explaining that no published Arkansas case was directly on point and that significant issues of Arkansas public policy were involved. Ark. Blue Cross & Blue Shield v. St. Vincent Infirmary, No. 4:03-CV-662, 2006 WL 796949 (E.DArk. Mar. 27, 2006) (unpublished). Here, given the extent to which Baptist relies on cases from other states on the merits of its appeal, it is clear that Appellees’ and In-tervenors’ state-law claims involve novel issues of state law. Further, in light of the fact that both parties (and the trial court) devoted significant time to discussing issues of public policy, it is equally clear that their state-law claims involve significant issues of Arkansas public policy. Additionally, Appellees noted that a preliminary injunction had already been issued by the state court at the time of the federal court’s final decision, so it is likely Judge Holmes would have been hesitant to exercise supplemental jurisdiction.1  Baptist cites two decisions where Judge Holmes did exercise supplemental jurisdiction in an attempt to demonstrate that he would have similarly heard Appellees’ state-law claims. |aBIt is not Appellees’ argument, however, that Judge Holmes never exercises supplemental jurisdiction but that he would not have exercised it here in a case that involved novel issues of state law and significant issues of public policy. Additionally, even if the court were to presume that Judge Holmes would have exercised supplemental jurisdiction over Appellees’ state-law claims, Intervenors’ claims would not be barred by res judicata. As described above, res judicata is inapplicable unless both suits at issue involve the same parties or their privies. Jay el Corp., 366 Ark. at 178, 284 S.W.3d 278. The court has never required strict privity to satisfy this fifth element. Id. at 178, 234 S.W.3d 278. However, “there must be a ‘substantial identity of parties’ ” to apply the doctrine. Id. “Privity of parties within the meaning of res judicata means a person so identified in interest with another that he represents the same legal right.” Bruns Foods of Morrilton, Inc. v. Hawkins, 328 Ark. 416, 418, 944 S.W.2d 509, 510 (1997) (citation omitted). Although never explicitly addressed by this court, other jurisdictions agree that whether parties are in privity is a factual question that is only reviewed for clear error. See, e.g., E.E.O.C. v. Perneo Aeroplex, Inc., 383 F.3d 1280, 1285 (11th Cir.2004) (“However, whether a party is in privity with another for preclusion purposes is a question of fact that is reviewed for clear error.”); Lowell Staats Min. Co. v. Philadelphia Elec. Co., 878 F.2d 1271, 1276 (1989) (“The determination of identity between litigants for the purpose of establishing privity is a factual question, and the District Court should not be reversed unless its determination is clearly erroneous.”) (citations omitted); \^Vulcan, Inc. v. Fordees Corp., 658 F.2d 1106, 1109 (6th Cir.1981) (“Whether privity exists in a given case is a question of fact.”). It does not appear that the trial court committed clear error as there was sufficient reason to find that there is not “substantial identity of parties” between Appel-lees and Intervenors. Although they share similar interests, Intervenors do not have any right of control over Appellees or vice versa. Further, Intervenors represent a much larger interest than that held by the Appellees. Intervenors represent physicians throughout the state who will be prohibited from working at any Baptist facility in the state if they (or a family member) has a financial interest in a competing facility. This is sufficient support for the trial court’s finding that privity was absent between Intervenors and Appellees. The court need not engage in any further review absent clear error by the trial court. BROWN, J., and Special Justice GEORGE ELLIS join.  . Baptist also cites Hancock v. First Stuttgart Bank & Trust Co., 53 Ark. App. 150, 920 S.W.2d 36 (1996), as rejecting an argument identical to Appellees and Intervenors’ claim that the federal court would have declined to exercise jurisdiction. In the Hancock case, however, the plaintiff filed both state and federal claims in federal court but her state claims were not addressed. Id. at 151, 920 S.W.2d 36. When plaintiff then filed identical state-law claims in state court, the court of appeals dismissed on res judicata grounds, noting that the district court had jurisdiction to exercise supplemental jurisdiction over her pendent state-law claims. Id. at 153, 920 S.W.2d 36. Here, in contrast, Appellees never alleged state-law claims in their federal antitrust action, same doctors who filed against Baptist in the instant matter.