Sunday, November 24, 2013

Parklane Hosiery Co. v. Shore case brief

Parklane Hosiery Co. v. Shore case brief summary
439 U.S. 322 (1979)


CASE SYNOPSIS
Certiorari was granted for a review of a judgment from the United States Court of Appeals for the Second Circuit, which reversed a denial of respondent's partial summary judgment motion where respondent sought to collaterally estop petitioner from relitigating the issues resolved in a separate action brought by the Securities and Exchange Commission.

CASE FACTS
Respondent sued, alleging misleading and material misrepresentations in petitioner's proxy statement. Before the action came to trial, the Securities and Exchange Commission (SEC) filed suit against petitioner, making essentially the same allegations, and entered a declaratory judgement after a trial. Respondent moved for a partial summary judgment to estop petitioner from relitigating the issues that had been resolved against them in the SEC action. The district court denied the motion on the ground that it violated petitioner's U.S. Constitutional Amendment VII right to a jury trial. The court of appeals reversed.

DISCUSSION

  • On review, the Court held that application of collateral estoppel did not violate petitioner's right to a jury trial, and mutuality was no longer required. 
  • The Court further held that the preferable approach was not to preclude the use of offensive collateral estoppel, but to grant trial courts broad discretion to determine its application. 
  • The general rule adopted by the Court was that offensive estoppel was precluded where plaintiff could have easily joined in the earlier action, or where application would be unfair to a defendant.
CONCLUSION
The Court affirmed the judgment of the court of appeals.

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