Rimkus Consulting Group Inc. v. Cammarata - Ballard Spahr LLP

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Case 4:07-cv-00405 Document 450 Filed in TXSD on 02/19/10 Page 94 of 139 judgment. LA. REV. STAT. § 13:4231. Louisiana courts have observed that this statute “embraces the broad usage of the phrase res judicata to include both claim preclusion (res judicata) and issue preclusion (collateral estoppel).” Am. Med. Enters., Inc. v. Audubon Ins. Co., 2005- 2006, p. 6 (La. App. 1 Cir. 6/8/07); 964 So. 2d 1022, 1028. Under claim preclusion, the res judicata effect of a final judgment on the merits precludes the parties from relitigating matters that were or could have been raised in that action. Under issue preclusion or collateral estoppel, however, once a court decides an issue of fact or law necessary to its judgment, that decision precludes relitigation of the same issue in a different cause of action between the same parties. Thus, res judicata used in the broad sense has two different aspects: (1) foreclosure of relitigating matters that have never been litigated, but should have been advanced in the earlier suit; and (2) foreclosure of relitigating matters that have been previously litigated and decided. Id. (citing Five N Company, L.L.C. v. Stewart, 02-0181, p.15 (La. App. 1 Cir. 7/2/03); 850 So. 2d 51, 61). The claim preclusion aspect of res judicata applies under Louisiana law “when all of the following are satisfied: (1) the judgment is valid; (2) the judgment is final; (3) the parties in the two matters are the same; (4) the cause or causes of action asserted in the second suit existed at the time of the final judgment in the first litigation; and (5) the cause or causes of action asserted in the second suit arose out of the transaction or occurrence that was the subject matter of the first litigation.” Smith v. State, 04-1317, p. 22 (La. 3/11/05); 899 So. 2d 516, 529–30. 1. Finality 94
Case 4:07-cv-00405 Document 450 Filed in TXSD on 02/19/10 Page 95 of 139 Rimkus argues that the summary judgment ruling in Louisiana is not final for purposes of preclusion because it is “subject to vacation and revision” on appeal, (Docket Entry No. 321-1 at 1), “such that this litigation does not constitute an impermissible collateral attack on a decision already made.” (Id. at 7). Rimkus argues that the Louisiana res judicata statute provides that “a valid and final judgment is conclusive between the same parties, except on appeal or other direct review.” (Docket Entry No. 353 at 2). As a result, according to Rimkus, a state court decision on appeal cannot be a final judgment for res judicata purposes. Courts applying Louisiana law have rejected the argument that a pending appeal from a trial court’s judgment defeats finality for preclusion purposes. In Fidelity Standard Life Insurance Co. v. First National Bank & Trust Co. of Vidalia, Georgia, 510 F.2d 272, 273 (5th Cir. 1975) (per curiam), the plaintiff sued in federal district court to enforce a judgment against the defendant obtained in Louisiana state court. The federal district court held that the Louisiana judgment was entitled to full faith and credit. Id. On appeal, the Fifth Circuit rejected the contention that the Louisiana judgment was not final for res judicata purposes because it was on appeal in the state courts. Id. The court held that “[a] case pending appeal is res judicata and entitled to full faith and credit unless and until reversed on appeal.” Id. Similarly, in Energy Development Corp. v. St. Martin, 296 F.3d 356, 360–61 (5th Cir. 2002), the Fifth Circuit analyzed Louisiana’s res judicata statute and held that a state court judgment is final for res judicata purposes when the trial court enters judgment. The Fifth Circuit relied on comment (d) of the Louisiana statute, which provides that the “preclusive 95
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Rimkus Consulting Group Inc. v. Cammarata - Ballard Spahr LLP

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