Non-mutual issue preclusion (NMIP) scenarios

Non-mutual issue preclusion is the exercise of issue preclusion (a/k/a/ collateral estoppel) by a person who was not a party to the prior litigation. That person might be a claimant (asserting it offensively, thus “offensive non-mutual issue preclusion”), or a defending party (asserting it defensively, thus “defensive non-mutual issue preclusion”). Non-mutual issue preclusion (or “NMIP”) is the modern trend but is still not permitted in some jurisdictions.

However, even where permitted, NMIP cannot be used against a party unless that party (or their privy) had their day in court on that issue in the prior litigation. Due process prohibits the exercise of issue preclusion against a person who was not a party or a privy to the prior litigation because they never had a prior opportunity to be heard on the issue. See Parklane, discussed in assigned readings.

Thus, NMIP is prohibited in the scenarios in the bottom row, where the person against whom NMIP is being asserted (or their privy) did not litigate in suit 1. But where a party (or privy) did litigate in suit 1 (the row above the bottom row), NMIP might be ok. Even then, however, a court must still determine whether that party had a “full and fair opportunity to litigate.” Parklane. The Parklane court lists a number of considerations in determining when NMIP is appropriate. See Parklane (also noted in readings).

Assume successive suits asserting the same fraud. The question is whether or not the finding on the issue of fraud from suit # 1 can be used defensively or offensively in suit # 2. Note that suit # 2 does  not have totally identical parties.

Defensive NMIP Offensive NMIP
POSSIBLY OK.  A. Same P, different Ds

Suit 1

  • P v D1
  • P loses

Suit 2

  • P v D2
  • If court permits, D2 can assert NMIP defensively against P, because P litigated and lost that issue in suit # 1 (see Blonder-Tongue).

Courts have discretion to allow: they will ask if P had a full and fair opportunity to litigate the issue in suit # 1.

 B. Different Ps, same D

Suit 1

  • P1 v D
  • D loses

Suit 2

  • P2 v D
  • If court permits, P2 can assert NMIP offensively against D, because D litigated and lost that issue in suit # 1 (see Parklane).

Courts have discretion to allow: in addition to asking if D had a full and fair opportunity to litigate in suit # 1, courts will ask if P2 could have joined as a party to suit # 1 but chose to “wait and see” what happened; whether D had a low incentive to defend vigorously in suit # 1; whether suit # 2 is in a court system with procedural opportunities that D lacked in suit # 1 that might cause a different result; and whether there were inconsistent findings in prior actions.
PROHIBITED.  C. Different Ps, same D

Suit 1

  • P1 v D
  • P1 loses

Suit 2

  • P2 v D
  • D cannot assert NMIP defensively against P2, because P2 was not a party or privy in suit #1.

Courts are prohibited from allowing defensive NMIP here, because doing so would violate P2’s right to Due Process. 

 D. Same P, different Ds

Suit 1

  • P v D1
  • D1 loses

Suit 2

  • P v D2
  • P cannot assert NMIP offensively against D2, because D2 was not a party or privy in suit #1.

Courts are prohibited from allowing offensive NMIP here, because doing so would violate D2’s right to Due Process.

Updated Nov. 16, 2020