I'm sympathetic to -- and on board with -- the result of this opinion. Which involves res judicata and a ton of other civil procedure stuff that's near and dear to my heart.
But I'm not at all certain that the holding of the case is doctrinally right.
You can see why the panel comes out the way it does. Plaintiff files a federal civil rights case that asserts a federal claim and some supplemental state law claims. The district court grants summary judgment to defendants, and then (with the federal claim dismissed) predictably declines to exercise supplemental jurisdiction over the pendent state law claims. So those get litigated in state court.
The plaintiff (again, predictably) appeals the dismissal of the federal claims, and the state claims go forward in state court) at the same time. The Ninth Circuit affirms the dismissal of the federal claims, and the state courts then hold that the federal holdings preclude the state suit (issue preclusion, etc.) since they're basically the same thing.
End of story. Lawsuits gone. Both state and federal. Federal on the merits, state because of issue preclusion given the federal result.
But then something unexpected happens.
The federal claims rise from the dead.
The Ninth Circuit takes the case en banc and reverses the grant of summary judgment. So now the federal claims are alive again, and there's no adverse issue preclusion.
Except for one thing. The state claims are now over. Their dismissal has been affirmed by the Court of Appeal. And the mandate has issued. So there's nothing left to do.
You see the injustice there. The state claims got dismissed for X reason, but X no longer exists. So the state claims should be revived. Yet they're dead, and the timeline to petition for rehearing etc. in the Court of Appeal is over. So what to do?
The Court of Appeal today has an answer. It doesn't like this result. Understandably so. A person has potentially important claims that have merit that were wrongly dismissed, for a reason we now know is wrong. So the Court of Appeal wants them to be addressed on the merits, rather than doing an injustice by keeping them dead.
I feel the same way.
So the Court of Appeal has a way to accomplish this end. Plaintiff in the present case filed a new state court lawsuit. One identical to the one that was dismissed. Normally that'd be totally barred by res judicata. As indeed the trial court held.
But the Court of Appeal holds that res judicata doesn't apply. That "exceptional circumstances" mean that it's okay, in this case, to file an identical suit to the one that's dismissed, and yet that suit gets to go forward. Because those exceptional circumstances -- the injustice that would result by not letting plaintiff have his day in court -- justify an exception to the usual res judicata rules.
That makes sense. On its own terms, anyway. We want people to have their claims heard on the merits, rather than dismissed for a legal reason that we got wrong, and denying res judicata to the second (totally identical) suit solves the problem. Plaintiff gets its claims adjudicated on the merits.
Problem solved.
The Court of Appeal discusses at length what it believes to be the primary arguments in opposition to that principle; namely, that the plaintiff should have sought a stay, tried to keep the first suit alive, etc. To be clear: Those are decent arguments. In lots of cases, that's in fact a better approach. And not granting res judicata effect does indeed diminish the incentive for plaintiffs to adopt these alternative (superior) approaches.
But the Court of Appeal nonetheless thinks that these counterarguments as a whole don't justify doing an injustice and depriving plaintiffs of their day in court.
And I get that. Both the sentiment as well as the doctrinal holding.
Here's the thing, though.
The procedural mechanism that the Court of Appeal adopts to deal with this problem is to create an exception to prevailing res judicata principles. Yes, that's one way to do it. But it's a procedure that creates lots of problems and inefficiencies of its own. It allows (indeed, requires) plaintiffs to file a duplicative second suit that's identical to their first (dismissed) one. It allows plaintiffs to potentially forum shop by filing that second suit in a different forum with different (perhaps more sympathetic) judge. It requires a new tribunal to get totally up to speed on a case that the first tribunal has already fully considered and has some familiarity with. There are, in short, definite downsides -- practical as well as doctrinal -- in permitting multiple duplicative lawsuits about the very same thing.
The Court of Appeal's holding will nonetheless engender these downsides in the service of a greater good: adjudication on the merits. And it gets those benefits by creating an exception to res judicata.
But there's a different way. A way that doesn't change res judicata law, that's simpler, and that doesn't engender the downsides of permitting multiple (potentially forum-shopped) adjudications.
And, as a bonus, it's the way the federal courts deal with this issue. Without tinkering in the slightest with res judicata law or requiring duplicative (identical) lawsuits.
Rule 60(b)(5).
See, in federal court, we have a principle -- backed up, even, by an express rule -- that says that the way we avoid this injustice is to permit the losing party to file a motion in the trial court for relief from the underlying judgment. And Rule 60(b)(5) involves precisely the situation presented here: when (in the express words of the rule) "the judgment . . . is based on an earlier judgment that has been reversed or vacated;" i.e., when (as here) the final judgment was based on applying res judicata from a prior judgment that was subsequently reversed.
So in federal court, you don't file a second duplicative suit. You file a post-trial, post-judgment motion in the trial court that says that the judgment should be changed because the other suit that formed the basis for the res judicata finding is now no more. And you'd win. Ergo getting your day in court.
And, unlike paragraphs (1) through (3) of Rule 60, there's no temporal limit on Rule 60(b)(5) motions. They can be filed at any time, not merely within a year.
Problem solved. Without the (substantial) difficulties necessarily engendered by the Court of Appeal's res judicata holding here.
The Court of Appeal never cites Rule 60(b)(5), nor does the opinion ever mention or discuss how the federal courts deal with this exact issue. Nor do I see anywhere in the opinion a case that holds that the federal way of dealing with things is foreclosed by California law. (And if I was going to find, or create, an exception for "exceptional circumstances," I would personally be just as willing -- or more so -- to do so in California's analogue to Rule 60 as I would to California's longstanding res judicata principles.) Admittedly, the Court of Appeal says that because the mandate had already issued in the Court of Appeal, the deadline to petition for rehearing there was already gone. But Rule 60, or the California judicial analogue, doesn't involve filings (or deadlines) in the appellate courts. It's a filing in the district court. And it's timely even when a similar filing in the appellate court would be time-barred.
So, in a nutshell, I agree with the result reached by the Court of Appeal. Plaintiff should have his day in court. And, in federal court, he definitely would.
But unless there's a California Supreme Court that's on all fours with this exact case, I'd get there via the Rule 60 route, not by fundamentally tinkering with res judicata.
That's a much better way.
(Oh, and if, perchance, there's a square California Supreme Court holding of which I'm unaware that says that you can't file a Rule 60-ish motion on the basis of the reversal of the judgment to which the prior court gave res judicata effect, then I'm confident that exact same reasoning would apply to the Court of Appeal's holding here. There's no way that the underlying equities don't permit you to file a motion for relief from the judgment and yet those exact same equities permit you to file an entirely separate lawsuit about the very same thing. So if the Court of Appeal for some reason couldn't adopt the Rule 60 route that I suggest here, then it can't backdoor this same result by creating an exception to res judicata principles to do the same thing.)
