SHANEY O’NEAL

SEPT 17, 2025

1. Analyze

To decide whether Beatrice Richman’s second claim is barred by res judicata, we apply the
federal standard for claim preclusion, which requires:

1. A final judgment on the merits.

Richman’s original lawsuit challenged Happy Town’s ordinance prohibiting private aircraft,
alleging violations of her equal protection rights under the First and Fourteenth Amendments.
The federal district court dismissed the case via summary judgment, which constitutes a “final
judgment on the merits” (Federated Dep’t Stores, Inc. v. Moitie, 452 U.S. 394, 398 (1981)).

In her amended complaint, Richman added new allegations: naming Commissioner Winn and
asserting that Winn coerced neighbors and incited defamatory public commentary. She also
alleged defamation and ethnic discrimination. While these claims invoke different legal theories,
they are rooted in the same factual transaction: her construction of a helicopter pad and the
Town’s enforcement of its ordinance.

Federal courts apply a transactional test to determine whether claims arise from the same nucleus
of operative facts. As the Supreme Court held in United States v. Tohono O’Odham Nation, 563
U.S. 307, 315 (2011), “[t]wo suits are for or in respect to the same claim when they are based on
the same operative facts.” Similarly, Restatement (Second) of Judgments § 24 emphasizes that all
claims arising from a single transaction must be brought in the same suit.

2. Answer

Yes, Richman’s second claim is barred by res judicata.

Despite introducing new legal theories and naming a new defendant, the second claim arises
from the same factual nucleus as the first. Courts discourage claim splitting, and res judicata bars
not only claims that were alredy litigated, but also those that could have been litigated in the
prior action (Allen v. McCurry, 449 U.S. 90, 94 (1980)).

Adding Commissioner Winn does not avoid preclusion. If Winn acted in his official capacity, he
is in privity with Happy Town. As held in Gregory v. Chehi, 843 F.2d 111, 120 (3d Cir. 1988),
“[a] judgment against a governmental entity bars a subsequent suit against an official of that
entity acting in his official capacity.”

Unless Richman can show that Winn’s alleged misconduct occurred after the first judgment or
was factually distinct, her second claim is precluded.
SHANEY O’NEAL
SEPT 17, 2025
CIVIL LAW 207

3. Discuss

In Federated Department Stores v. Moitie, 452 U.S. 394, 398–402 (1981), the Supreme

Court upheld claim preclusion where plaintiffs attempted to re-litigate antitrust claims that had

already been dismissed with prejudice. The Court emphasized that the finality of a judgment on

the merits is not undermined by its perceived correctness, stating that “the res judicata

consequences of a final, unappealed judgment on the merits are not altered by the fact that the

judgment may have been wrong.” Id. at 398. The plaintiffs’ reassertion of the same legal theories

based on the same transactional facts triggered res judicata, even though they tried to re-package

the claims in a new complaint.

By contrast, in Creation Supply, Inc. v. Selective Insurance Co., 995 F.3d 576, 580–83

(7th Cir. 2021), the Seventh Circuit declined to apply claim preclusion because the prior state

court judgment had resolved only the insurer’s duty to defend, not the separate issue of damages

for breach of contract. Although the parties were the same, the federal suit raised a distinct claim

that had not already been litigated or resolved in the earlier proceeding. The court emphasized

that claim preclusion does not bar litigation of issues that were neither actually decided nor

necessarily included in the prior judgment. Id. at 582.

Applying this comparison to Richman’s case, her amended complaint

resembles Moitie more than Creation Supply. Like the plaintiffs in Moitie, Richman is re-

asserting claims arising from the same factual nucleus: her conflict with Happy Town’s

ordinance and its enforcement, even though she adds new allegations and names a new

defendant. Unless she can show that the new claims involve facts or harms that occurred after the
SHANEY O’NEAL
SEPT 17, 2025
CIVIL LAW 207

original judgment, or that Commissioner Winn acted in an individual capacity outside the scope

of the original litigation, her second claim is barred under the doctrine of res judicata.

QUESTION 2

1. Discuss the Case and Whether Collateral Estoppel Is Involved

In Lucky Brand Dungarees v. Marcel Fashions Group, the Supreme Court addressed whether a
party can be barred from raising a defense in a later lawsuit between the same parties when that
defense was not fully litigated in a prior suit. The case involved a long-running trademark
dispute over the use of the word “Lucky” in apparel branding. Marcel owned the trademark “Get
Lucky,” while Lucky Brand used “Lucky Brand” and other similar marks.

After multiple rounds of litigation, Marcel argued that Lucky Brand should be barred from
asserting a defense based on a 2003 settlement agreement, because Lucky Brand had raised that
defense in a prior suit but failed to pursue it. The Second Circuit accepted this argument under a
theory called “defense preclusion,” which is conceptually related to collateral estoppel (issue
preclusion).

The Supreme Court granted certiorari to clarify whether such preclusion applies to defenses in
later suits involving different claims.

2. What Did the Court Say About Collateral Estoppel?

The Court, in a unanimous opinion by Justice Sotomayor, held that collateral estoppel does not
apply in this case because the later suit involved different claims and different conduct.
Specifically:

“Issue preclusion prevents parties from re-litigation issues that were decided in a prior case. But
it applies only when the second suit involves the same issue as the first.”
— Lucky Brand Dungarees, Inc. v. Marcel Fashions Group, Inc., 590 U.S. ___ (2020)

The Court emphasized that defense preclusion, which is a theory that would bar a party from
raising a defense it could have raised earlier, is not a recognized extension of issue preclusion
unless the suits share a common nucleus of operative facts. Because the 2011 suit involved
different alleged trademark violations than the 2005 suit, the Court found no basis for preclusion.
SHANEY O’NEAL
SEPT 17, 2025
CIVIL LAW 207
3. Does It Make Sense to You?

Yes, the Court’s reasoning makes sense. It preserves the integrity of issue preclusion by limiting
its application to cases where the same factual and legal issues were litigated and decided. It also
avoids expanding preclusion doctrines in a way that could unfairly penalize parties for strategic
litigation choices in earlier suits.

4. Why or Why Not?

The Court’s approach is sound because it respects the boundaries between claim preclusion,
issue preclusion, and emerging theories like defense preclusion. If courts allowed broad
preclusion of defenses that were merely raised but not litigated, it could discourage parties from
narrowing issues in earlier cases or adapting their strategy to evolving facts.

Therefore, the Court’s insistence on a shared factual nucleus aligns with the transactional test
used in res judicata analysis (United States v. Tohono O’Odham Nation, 563 U.S. 307 (2011))
avoids combining distinct legal doctrines.

5. Explain Your Position

I agree with the Court’s decision because it supports the procedural fairness based in preclusion
doctrines. Issue preclusion should apply only when an issue was actually litigated and
necessarily decided. Extending it to defenses that were raised but not pursued, especially in cases
involving different conduct and different claims.

In this case, Lucky Brand’s defense based on the 2003 settlement agreement was not fully
litigated in the 2005 action, and the 2011 claims involved new alleged infringements. Thus,
barring the defense would have been both doctrinally unsound and procedurally unfair.