United States Court of Appeals
For the First Circuit
No. 05-1509
JOSEPH MAHER,
Plaintiff, Appellant,
v.
GSI LUMONICS, INC.,
Defendant, Appellee.
____________________
CHARLES WINSTON,
Defendant.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Edward F. Harrington, Senior U.S. District Judge]
Before
Lynch and Howard, Circuit Judges,
and Restani, Judge.*
Martha M. Wishart, with whom McKenzie & Associates, P.C., was
on brief, for appellant.
Brian E. Lewis, with whom Doreen M. Zankowski, Douglas F.
Seaver, and Hinckley, Allen & Snyder LLP were on brief for
appellee.
December 28, 2005
*
Honorable Jane A. Restani, Chief Judge of the United States
Court of International Trade, sitting by designation.
RESTANI, Judge. On January 29, 2003, Joseph Maher
(“Maher”), invoking federal question jurisdiction, filed suit in
federal court against employer-defendant GSI Lumonics, Inc.
(“GSI”), alleging age discrimination in his termination from
employment. The district court granted summary judgment in favor
of GSI on the federal claims and “transferred” the related state-
law claims to Massachusetts state court. Because such a transfer
is not allowed, the state court dismissed the case.
On August 27, 2004, Maher filed a new complaint in
Massachusetts state court, alleging similar employment
discrimination claims. GSI removed the suit to federal court and
then moved for summary judgment on res judicata grounds. The
district court granted the motion, and Maher appeals. We affirm
the district court’s grant of summary judgment.
I. PROCEDURAL BACKGROUND
On December 27, 2002, Maher filed a complaint against GSI
with the Massachusetts Commission Against Discrimination and the
Equal Employment Opportunity Commission, claiming that age
discrimination motivated his termination from employment. After
receiving right-to-sue letters from both agencies, Maher filed a
complaint against GSI in district court based upon federal question
jurisdiction.1 Maher v. GSI Lumonics, Inc., No. 03-10187 (D. Mass.
1
In this first action Maher alleged: (1) age discrimination
under the Age Discrimination in Employment Act, 29 U.S.C. §621 et
seq., (2) violation of the Older Workers’ Benefit Protection Act
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Jan. 29, 2003) [hereinafter Maher I]. He did not plead diversity
jurisdiction although it was available – Maher is domiciled in
Massachusetts while GSI is a Canadian corporation. At the close of
discovery, GSI moved for summary judgment. The district court
granted summary judgment in favor of GSI on the federal claims but
declined to exercise supplemental jurisdiction over the state-law
claims. The district court instead “transferred [the state-law
claims] to state court.” Maher I, slip op. at 5 (D. Mass. April 9,
2004). The state court then dismissed the case without prejudice
because a case that originates in federal court cannot be
“transferred” to state court.2
On August 27, 2004, Maher filed a new complaint in state
court, alleging the two state-law claims he had alleged previously
in Maher I. Maher v. GSI Lumonics, Inc., DSCV 2004-0160B (Essex
Super. Ct. Aug. 27, 2004) [hereinafter Maher II]. Maher also added
one new state-law claim and a new defendant, Charles Winston.3 GSI
removed the action to federal court based upon diversity of
(“OWBPA”), 29 U.S.C. § 626 (f), (3) unlawful “retaliation” under
OWBPA, (4) age discrimination under the Massachusetts Fair
Employment Practices Law, Mass. Gen. Laws ch. 151B, and (5) breach
of the covenant of good faith and fair dealing.
2
28 U.S.C. § 1631 provides for transfer from one federal court
to another to cure want of jurisdiction.
3
Winston is the President and CEO of GSI. He was voluntarily
dismissed from the case by Maher on March 24, 2005.
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citizenship.4 Once in federal court, GSI moved for summary
judgment, alleging that res judicata precluded Maher’s second suit,
and the district court granted GSI’s motion. This appeal followed.
II. DISCUSSION
We review de novo the district court’s grant of summary
judgment based upon res judicata. AVX Corp. v. Cabot Corp., 424
F.3d 28, 30 (1st Cir. 2005). Here, because the judgment in Maher
I was rendered by a federal court exercising federal question
jurisdiction, the applicability of res judicata is a matter of
federal law. See AVX Corp., 424 F.3d at 30; Kale v. Combined Ins.
Co. of Am., 924 F.2d 1161, 1164 (1st Cir. 1991) (citing Cemer v.
Marathon Oil Co., 583 F.2d 830, 832 (6th Cir. 1978)).
“Under the federal law of res judicata, a final judgment
on the merits of an action precludes the parties from relitigating
claims that were raised or could have been raised in that action.”
Porn v. Nat’l Grange Mut. Ins. Co., 93 F.3d 31, 34 (1st Cir. 1996)
(citing Allen v. McCurry, 449 U.S. 90, 94 (1980)). Res judicata
promotes judicial efficiency and prevents “claim-splitting” by
requiring litigants to assert all of their factual allegations and
legal theories, including jurisdictional allegations, pertaining to
their claim the first time they come to court. See Kale, 924 F.2d
at 1165. Notably, in Kale, we held that a litigant’s second suit
4
The addition of Winston, a resident of California, did not
destroy diversity.
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was precluded because he did not pursue all of his state-law claims
by asserting diversity jurisdiction in his first suit in federal
court when he could have done so. Id.
A. Application of Kale v. Combined Insurance Co. of America
The present case involves essentially the same procedural
missteps made in Kale. In Kale, the plaintiff-appellant Carl Kale
filed suit against his former employers in federal court, pleading
federal question jurisdiction, but not diversity jurisdiction. Id.
at 1163. The district court granted summary judgment in favor of
the defendant on Kale’s federal claims and dismissed without
prejudice the related state-law claims. Id. Kale did not seek to
amend his complaint in district court to allege diversity
jurisdiction but instead filed suit in Massachusetts state court,
alleging injuries stemming from the same cause of action. Id. at
1163–64. The defendant removed the state case to federal court
based upon diversity jurisdiction and then moved for summary
judgment on res judicata grounds. Id. at 1164. The district court
granted the motion and we affirmed on appeal. Id. at 1169. We
held that Kale’s second suit was precluded because he could have
pursued his state-law claims in his first suit if he had alleged
diversity jurisdiction. Id. at 1166. We also noted that a
“cursory reference” to diversity jurisdiction in a string cite did
not adequately raise the issue before the district court. Id. at
1164 n.1.
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In the present case, Maher also could have had his state-
law claims heard in his first suit if he had asserted diversity
jurisdiction. Like Kale, Maher did not plead diversity
jurisdiction in his original complaint, nor did he later attempt to
amend his complaint to do so. Maher argues, however, that his case
is distinguishable from Kale because diversity jurisdiction is
apparent on the face of the complaint through the statement of the
parties’ domiciles. Like Kale’s “cursory reference” to diversity
jurisdiction, Maher’s reliance on sua sponte action by the district
court to assert diversity jurisdiction for him is unavailing. “The
burden of proving the existence of . . . diversity jurisdiction .
. . lies with the pleader.” Kale v. Combined Ins. Co. of Am., 736
F. Supp. 1183, 1184 n.3 (D. Mass. 1990) (citing Thomson v. Gaskill,
315 U.S. 442, 446 (1942)). It is Maher’s duty to assert the
jurisdictional basis of his claim.5
B. The Elements of Res Judicata Are Established
Before res judicata will apply, three factors must be
present: “(1) a final judgment on the merits in the earlier action;
5
Maher argues that this court should not follow Kale but
should follow Epperson v. Entertainment Express, Inc., 242 F.3d 100
(2d Cir. 2001), which held that plaintiffs were not prohibited from
“pursuing some of their claims on a narrower jurisdictional basis
after their attempt to allege a jurisdictional basis that would
resolve all of their claims in one proceeding was rejected.”
Epperson is not contrary to Kale, as the Second Circuit itself
remarked. See id. at 109. The Second Circuit distinguished Kale
because unlike the plaintiff in Epperson, Kale did not allege
diversity jurisdiction, which would have allowed him to resolve all
of his claims in one proceeding. Id.
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(2) an identity of the cause of action in both the earlier and
later suits; and (3) an identity of parties or privies in the two
suits.” Kale, 924 F.2d at 1165. There is no dispute that elements
two and three of res judicata are established. The only remaining
issue is whether there was a final judgment on the merits.
A final judgment for res judicata purposes “end[s] the
litigation on the merits and [leaves] nothing for the court to do
but execute the judgment.” AVX Corp., 424 F.3d at 32 (quoting
Acevedo-Villalobos v. Hernandez, 22 F.3d 384, 388 (1st Cir. 1994)
(citation omitted)). When deciding whether a ruling by a judge
ended the litigation, “we [are] bound to defer to a reasonable
interpretation of the judgment’s meaning and effect elucidated by
the judicial officer who authored it.” Witty v. Dukakis, 3 F.3d
517, 520 (1st Cir. 1993).
Here, Maher argues that there was no final judgment
because his state-law claims were not dismissed without prejudice
but were “transferred” to state court by the district court. The
“transfer” of his state-law claims does not, however, negate the
fact that there was a summary judgment on his federal claims which
provides the “traditional basis for the operation of res judicata.”
AVX Corp., 424 F.3d at 34 (distinguishing Kale, 924 F.2d at 1165).
Moreover, because the district court “transferred” the state-law
claims only after declining to exercise supplemental jurisdiction,
the district judge likely meant for the “transfer” to operate as a
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dismissal.6 Thus, the district court rendered a final judgment on
the merits. Accordingly, all three elements of the test are
established and res judicata applies in this case.7
C. Equitable Exceptions to Res Judicata Do Not Apply
Maher also argues that an equitable exception to res
judicata should be made in this case. Although an “occasional
exception” can be made if there is an “unusual hardship,” this is
not such a case. See Kale, 924 F.2d at 1168 (no “unusual hardship”
when plaintiff did not plead diversity jurisdiction although it was
available) (citation omitted). Here, Maher had a full and fair
opportunity to assert diversity jurisdiction and litigate all his
claims in one proceeding, but he chose not to do so. It is Maher’s
own actions that now result in the preclusion of his suit. Thus,
6
When the district judge later addressed Maher’s argument that
a transfer differs from a dismissal, he stated that in order to
address the argument, he would have to “assum[e] there [was] a
distinction between [these] two procedural mechanisms.” Maher II,
slip op. at 2 (D. Mass. Feb. 28, 2005). The fact that the district
judge needed to “assume” there was a difference between the two
procedures demonstrates that he likely did not see a difference
between the effect of the two procedures when he “transferred” the
case.
7
Maher also argues that the state court reserved his right to
maintain a second suit when it dismissed his case without
prejudice. The exception applies, however, when “the court in the
first action has expressly reserved the plaintiff’s right to
maintain the second action.” See Kale, 924 F.2d at 1167 (quoting
Restatement (Second) of Judgments § 26(1)(b) (1982)) (emphasis
added). Thus, because a federal court rendered the first ruling,
we examine the effect of the federal court’s ruling. In federal
court, a dismissal of pendent claims on jurisdictional grounds is
not considered an express reservation of the right to maintain a
second action. See id.
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an equitable exception to the application of res judicata does not
apply.
For the foregoing reasons, we affirm the grant of summary
judgment in favor of GSI based upon res judicata.
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