Court Opinion

ID: 8961505
Source: CourtListenerOpinion
Date Created: 2022-11-27 09:42:13.689237+00
Date Added: 2024-06-11T17:10:12.288517
License: Public Domain

KRUPANSKY, Circuit Judge,
dissenting.
The plaintiffs-appellants in this case, various members of the Guzowski family (hereafter “Guzowskis” or “appellants”),1 operate a family business which breeds and races thoroughbred horses. The Guzow-skis had filed a complaint in federal district court in December 1981 (hereafter “1981 complaint”) against various officers, directors, owners and license holders of thoroughbred race tracks who conduct racing meets within the State of Michigan, alleging that the appellees had engaged in a systematic practice of excluding them from the use of the race tracks and horse stalls and from participating in racing events in the State of Michigan.
The 1981 complaint alleged causes of action under §§ 1 and 2 of the Sherman Antitrust Act for violation of antitrust laws; under §§ 1983 and 1985(3) of the Civil Rights Act for violation of constitutionally protected rights; and for state law claims for breach of contract and tort. In May, 1982, the District Court dismissed the appellant’s complaint in its entirety, concluding that the antitrust violations alleged were barred under the state action immunity doctrine; and that the § 1983 action failed to state a claim because there was no allegation of state action; that the § 1985(3) claim was similarly deficient because it failed to allege class or race discrimination.2
*257In its order of dismissal the district court accorded the appellants leave to amend their complaint, but only to provide appellants with an opportunity to state an antitrust action outside of the state action immunity exception. The appellants filed an amended complaint which essentially alleged the same defective antitrust claim as had been pleaded in its initial complaint. The district court reviewed the amended complaint, concluded that it again was deficient, and entered an order of dismissal for failure to comply with the court’s order to amend (1982 dismissal).
The Guzowskis appealed only the district court’s decision concerning the section 1 Sherman Antitrust claim.3 On November 28, 1983, in an unpublished per curiam opinion (hereinafter “1983 appeal”), a panel of this court affirmed the district court’s 1982 dismissal of the antitrust claim under § 1 of the Sherman Antitrust Act with the observation that:
[the] dismissal for failure to state a claim is without prejudice, and the Guzowskis are free to file a new complaint.
Guzowski, No. 82-1819, slip op. at 9 (6th Cir.1983). However, the panel, in its opinion, made no specific mention or determination that the district court had abused its discretion in dismissing the appellants’ claims with prejudice.
In 1984, subsequent to the unfavorable disposition of the foregoing 1983 appeal, the Guzowskis filed a second action in federal court against essentially the same defendants (hereafter “1984 complaint”), alleging causes of action under the Sherman and Clayton Antitrust Acts; under § 1983 for violation of constitutionally protected rights; a cause of action for violation of the Racketeer Influenced and Corrupt Organizations Act (RICO); and three pendent state claims sounding in tort and contract. The defendants filed a motion to dismiss the 1984 complaint, or alternatively for partial summary judgment, asserting the defense of res judicata based upon the district court’s 1982 dismissal of the 1981 complaint.
The motion was referred to a magistrate, who concluded that the dismissal of the 1981 action had been with prejudice. Upon reviewing the unpublished per curiam opinion in the 1983 appeal, the magistrate concluded that the district court’s dismissal had been affirmed without modification, and thus constituted an adjudication on the merits as to all of the claims presented. The district court adopted the magistrate’s recommendation and dismissed the 1984 complaint as being precluded in its entirety. The Guzowskis have appealed the district court’s order foreclosing them from pursuing their 1984 suit.
The majority opinion in the instant review correctly notes that ordinarily a district court’s dismissal of a law suit would constitute an adjudication on the merits which would bar any subsequent action predicated upon a common nexus of operative law and fact. See, e.g., Fed.R.Civ.P. 41(b);4 see also Federated Dep’t Stores, Inc. v. Moitie, 452 U.S. 394, 399 n. 3, 101 S.Ct. 2424, 2428 n. 3, 69 L.Ed.2d 103 (1981) (“The dismissal for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6) is a ‘judgment on the merits.’ ”); Shaw v. Merritt-Chapman & Scott Corp., 554 F.2d 786, 789 (6th Cir.) (“The sustaining of a motion to dismiss for insufficiency of the complaint serves as an adjudication upon the merits, unless the district court specifies otherwise.”), cert. denied, 434 *258U.S. 852, 98 S.Ct. 167, 54 L.Ed.2d 122 (1977). Upon the brief observation in the unpublished 1983 per curiam opinion, the majority has reasoned that the 1983 appellate disposition had served to modify the district court’s order to convert the 1981 dismissal of the appellants’ antitrust action under section 1 of the Sherman Act from a dismissal with prejudice to a dismissal without prejudice, thereby opening the way for the plaintiffs to commence a subsequent action predicated upon the same core of law and fact.
The majority in the instant appeal errs in this conclusion. The 1983 panel could have modified the 1982 dismissal only if it had concluded that the district court had abused its discretion under Rule 41(b) in dismissing the 1981 complaint with prejudice. “[T]he scope of review over an order of dismissal accorded an appellate court is extremely narrow, confined solely to whether the control has been exercised within the permissible range of the trial court’s discretion.” Theilmann v. Rutland Hospital, Inc., 455 F.2d 853, 855, 20 A.L.R.Fed. 482, 486 (2nd Cir.1972) (per curiam); accord Link v. Wabash R.R., 370 U.S. 626, 633, 82 S.Ct. 1386, 1390, 8 L.Ed.2d 734 (1962); Bishop v. Cross, 790 F.2d 38, 39 (6th Cir.1986); Patterson v. Township of Grand Blanc, 760 F.2d 686, 688 (6th Cir.1985) (per curiam); Johnson v. Hubbard, 698 F.2d 286, 290 (6th Cir.), cert. denied, 464 U.S. 917, 104 S.Ct. 282, 78 L.Ed.2d 260 (1983); Carter v. City of Memphis, 636 F.2d 159, 161 (6th Cir.1980); Shaw, 554 F.2d at 789; cf. Harris v. Callwood, 844 F.2d 1254, 1257-61 (6th Cir.1988) (Ryan, J., dissenting).5 However, the 1983 panel affirmed the district court’s dismissal of the Guzowskis’ 1981 antitrust action without ever considering the issue of whether the district court had abused its discretion in dismissing that action with prejudice. The issue was neither raised nor discussed by the parties to the 1983 appeal.
Because the panel in the 1983 appeal made no determination, either expressly or impliedly, that the district court had abused its discretion in dismissing the appellants’ 1981 complaint with prejudice, I am constrained to conclude that the district court’s 1982 dismissal with prejudice as to all of the appellants’ claims must be given preclusive effect, and that the district court in the present appeal correctly concluded that the Guzowskis were barred by res judicata from bringing any cause of action in their 1984 complaint which had been, or could have been, brought at the time the 1981 action was filed. Federated Dep’t Stores, Inc., 452 U.S. at 398, 101 S.Ct. at 2428 (“A final judgment on the merits of an action precludes the parties or their privies from relitigating issues that were or could have been raised in that action.”). All of the counts alleged by the appellants in their 1984 complaint, including the claims under the Clayton Antitrust Act and RICO, arose from the same core of operative facts upon which the 1981 complaint had been based, and could thus have been brought at the time the 1981 complaint was filed.
Accordingly, I would affirm the order of the district court granting summary judg*259ment to the defendants as to all counts contained in the 1984 complaint.

. The individual plaintiffs are Frank Guzowski, Theresa Guzowski, Lorraine Guzowski, Raymond Guzowski, and Donald Guzowski.

. The district court also dismissed the pendent state law claims sounding in tort and contract.

. The majority correctly observes that, because the Guzowskis did not appeal the district court’s earlier dismissal of the claims predicated upon § 2 of the Sherman Antitrust Act, §§ 1983 and 1985, they were collaterally estopped from pursuing those causes of action in a subsequent action.

. Federal Rule of Civil Procedure 41(b) states, in pertinent part, that:
[fjor failure of the plaintiff to prosecute or to comply with these rules or any order of court, a defendant may move for dismissal of an action or of any claim against the defend-ant____ Unless the court in its order for dismissal otherwise specifies, a dismissal under this subdivision and any dismissal not provided for in this rule, other than for lack of jurisdiction, for improper venue, or for failure to join a party under Rule 19, operates as an adjudication upon the merits.
Fed.R.Civ.P. 41(b) (emphasis added).

. In Harris, a majority of the panel reversed a district court's dismissal of an action, with prejudice, based upon a failure to prosecute. (The standard of review is identical for both dismissal for failure to prosecute, as in Harris, and dismissal for failure to comply with a court's orders, as in the instant appeal. Compare 9 C. Wright & A. Miller, Federal Practice and Procedure § 2370, at 203 & n. 98 with id. § 2376, at 248 & n. 59 and 5 J. Moore, J.D. Lucas & J. Wicker, Moore’s Federal Practice ¶ 41.12, at 41-157 & n. 35 (2nd ed. 1986); see also Fed.R.Civ.P. 41(b).) Judge Ryan dissented from the majority’s decision to reverse the district court’s dismissal under Rule 41(b) “without finding any abuse of discretion or even acknowledging the existence of that standard,” concluding that before an appellate court can alter or amend a district court’s dismissal, it must first determine whether the district court had abused its authority in dismissing the particular action with prejudice based upon an examination of the individual facts presented. Harris, 844 F.2d at 1257 (Ryan, J., dissenting). In the instant case, the majority makes precisely the same error in concluding that the 1983 appeal had modified the district court’s dismissal with prejudice where that panel neither acknowledged nor applied the abuse of discretion standard.