Thursday, August 02, 2007

U.S. Court of Federal Claims Holds Plaintiff's ASBCA Claims Barred by Res Judicata

Per Phillips/May Corp. v. U.S., 76 Fed.Cl. 671 (Fed.Cl. Apr 19, 2007) (NO. 06-47 C):
The claims raised in the present case were not litigated in the ASBCA [Armed Services Board of Contract Appeals] proceedings and, therefore, collateral estoppel does not foreclose their relitigation. However, this Court must determine whether plaintiff's claims are precluded by the claim preclusion aspect of res judicata. In determining whether claim preclusion functions to bar a party's claim, the Federal Circuit employs a transactional approach. See, e.g., Ind. Mich. Power Co. v. United States, 422 F.3d 1369, 1377-78 (Fed.Cir.2005) ("[T]he doctrine of res judicata ... in its claim preclusion form[ ] provides that final judgment on a claim extinguishes 'all rights of the plaintiff to remedies against the defendant with respect to all or any part of the transaction, or series of connected transactions, out of which the action arose.' " (quoting Young Eng'rs, 721 F.2d at 1314)).

Res judicata is not invoked solely as a result of prior judicial decisions; when an administrative agency acts in a judicial capacity, permitting the parties to fully litigate their claims, its final determination is also accorded res judicata effect. The Court of Federal Claims has recognized that decisions of the ASBCA preclude, on res judicata grounds, the litigation of claims in this court that should have been litigated before the ASBCA. See, e.g., Zoeller, 65 Fed.Cl. at 456-57; Ingalls Shipbuilding, Inc. v. United States, 21 Cl.Ct. 117, 122-25 (1990).

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[The] plaintiff in this case both was able to and did fully litigate the merits of the claims it asserted in the first proceeding. Application of the doctrine of res judicata in its issue- and claim-preclusion aspects is intended to "relieve parties of the cost and vexation of multiple lawsuits, conserve judicial resources, and, by preventing inconsistent decisions, encourage reliance on adjudication." Allen v. McCurry, 449 U.S. 90, 94, 101 S.Ct. 411, 66 L.Ed.2d 308 (1980) (citing Montana v. United States, 440 U.S. 147, 153-54, 99 S.Ct. 970, 59 L.Ed.2d 210 (1979)). Because plaintiff could have fully litigated its remaining claims before the ASBCA, and because those claims, which plaintiff now seeks to litigate in this action, arose out of the same transactional facts as its appeals to the ASBCA, the Court, applying principles and authority of long standing regarding the claim-preclusion aspect of res judicata, determined that the judgments of the ASBCA resolving plaintiff's claims before that tribunal barred plaintiff's claims in this action. See, e.g., Young Eng'rs, Inc. v. United States Int'l Trade Comm'n, 721 F.2d 1305, 1314-15 (Fed.Cir.1983); Ammex, Inc. v. United States, 334 F.3d 1052, 1055-56 (Fed.Cir.2003); see also 18 Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure ยง 4407 (2d ed.2002). In so holding, the Court was guided by Justice Blackmun's oft-quoted dictum that res judicata should be invoked in such circumstances "only after careful inquiry," Brown v. Felsen, 442 U.S. 127, 132, 99 S.Ct. 2205, 60 L.Ed.2d 767 (1979), as well as the admonition of the Federal Circuit that "due process of law and the interest of justice require cautious restraint" in applying res judicata to preclude litigation of "claims that were not before the court" (or tribunal) in the prior proceeding and that "[p]recedent weights heavily against denying litigants a day in court unless there is a clear and persuasive basis for that denial." Kearns, 94 F.3d at 1557. As explained in the Opinion and Order filed April 19, 2007, here the undisputed facts establish such "a clear and persuasive basis" for the Court's holding that res judicata bars plaintiff from asserting in this action claims that arose out of the same transactional facts as the claims plaintiff litigated before the ASBCA.


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