United States Court of Appeals
Fifth Circuit
F I L E D
UNITED STATES COURT OF APPEALS
January 28, 2005
FIFTH CIRCUIT
Charles R. Fulbruge III
____________ Clerk
No. 03-31172
____________
DWIGHT VINES; VAN MCGRAW,
Plaintiffs-Appellees,
versus
UNIVERSITY OF LOUISIANA AT MONROE; BOARD OF
SUPERVISORS OF THE UNIVERSITY OF LOUISIANA
SYSTEM,
Defendants-Appellants.
Appeal from the United States District Court
for the Western District of Louisiana
Before KING, Chief Judge, and SMITH and GARZA, Circuit Judges.
EMILIO M. GARZA, Circuit Judge:
The University of Louisiana at Monroe1 and the Board of Trustees, University of Louisiana
System (hereinafter co llectively “ULM”) appeal the district court’s denial of their motion for
permanent injunction under the “relitigation exception” to the Anti-Injunction Act claiming that the
1
Northeast Louisiana University changed its name to the University of Louisiana at Monroe
in 1999.
1
doctrines of res judicata and collateral estoppel preclude Dwight Vines’ and Van McGraw’s age
discrimination suit filed in state court. We find that all of the elements of ULM’s collateral estoppel
claim have been satisfied and that the instant case falls within the relitigation exception to the Anti-
Injunction Act. We therefore REVERSE and REMAND to the district court to enter an injunction
preventing Vines and McGraw from proceeding with their state age discrimination claims against
ULM.
I
Vines and McGraw are former administrators and faculty members of ULM. After serving
a sufficient number of years to qualify for retirement benefits under the Teachers’ Retirement System
of Louisiana (“TRSL”), Vines voluntarily elected to retire in 1991 and McGraw elected to retire in
1989. Pursuant to the TRSL, they each received retirement benefits for life and one-hundred percent
of their average compensation during their previous three years. Vines and McGraw were
simultaneously rehired on a year-to-year basis and each worked for five years, receiving retirement
benefits in addition to a salary for wo rk performed. In January 1996, the University of Louisiana
System adopted a policy prohibiting the re-employment of retirees on a regular full-time basis and
Vines and McGraw were notified that they would not be rehired for the 1996-97 academic year.
Vines and McGraw filed identical suits in federal and state court, claiming ULM violated the
federal Age Discrimination in Employment Act (“ADEA”) (29 U.S.C. § 621 (2004) et. seq.) and
Louisiana Employment Discrimination Law (“LAEDL”) (LA. REV. STAT. ANN. § 23:301 (2004) et.
seq.) by prohibiting re-employment of retirees, paying the plaintiffs less than younger professors, and
increasing their workloads. ULM removed the state court suit under federal question jurisdiction and
the cases were consolidated. The Equal Employment Opportunity Commission (“EEOC”) then
2
instituted a separate action in federal court, naming Vines and McGraw as aggrieved parties, alleging
violations of the ADEA by ULM. The EEOC action was also consolidated with Vines’ and
McGraw’s cases.
ULM filed a motion for summary judgment seeking dismissal of all the remaining ADEA
claims based upon Kimel v. Florida Board of Regents, 528 U.S. 62 (2000). The district court
concluded that it lacked jurisdiction over Vines’ and McGraw’s ADEA claims, but that the EEOC
was not barred from asserting those claims on their behalf. Vines’ and McGraw’s state law claims
were remanded to state court. The district court then granted ULM’s motion for summary judgment
dismissing the EEOC lawsuit, finding that ULM’s policy did not violate the ADEA. The EEOC
sought to appeal the judgment, but then voluntarily dismissed the appeal.
ULM filed a peremptory exception of res judicata/collateral estoppel in the present case in
state court, arguing that Vines and McGraw asserted the same claims and issues previously litigated
and decided adversely to them in federal court. The Louisiana trial court granted the exception,
dismissing the state claims with prejudice after finding that the federal principles of res judicata
applied to bar the suit. The court noted that the federal court decision was rendered by a court of
competent jurisdiction, the decision was final and on the merits, the EEOC and the plaintiffs were in
privity, and the causes of action arose from the same nucleus of operative facts. The Second Circuit
Court of Appeal in Louisiana reversed the trial court judgment, which had granted an exception of
res judicata in favor of ULM, and reinstated the state court action, concluding that privity did not
exist between Vines and McGraw and the EEOC. Vines v. Northeast La. Univ., 839 So.2d 979, 987
(La.App. 2 Cir. 3/5/03). ULM’s request for en banc rehearing in the Second Circuit and their
application for writ to the Louisiana Supreme Court were denied. Vines v. Northeast La. Univ., 853
3
So.2d 638, 638 (La. 9/19/03).
ULM filed a motion under the “relitigation exception” of the Anti-Injunction Act with the
Western District of Louisiana seeking to enjoin Vines and McGraw’s lawsuit in state court based on
the federal court’s decision in favor of ULM against the EEOC. The district court denied the
permanent injunction and ULM appealed to this court.
II
We generally review a district court’s denial of a motion for a permanent injunction for abuse
of discretion. See St. Paul Mercury Ins. Co. v. Williamson, 332 F.3d 304, 308 (5th Cir. 2003). The
application of the relitigation exception to the Anti-Injunction Act, however, is a question of law and
therefore we review the district court’s denial of ULM’s motion for a permanent injunction de novo.
Id.
The Anti-Injunction Act generally prohibits federal courts from interfering with proceedings
in state court. 28 U.S.C. § 2283 (2004). There are only three specific circumstances in which a
federal court can enjoin a state court proceeding, when it is: (1) expressly authorized by a federal
statute; (2) necessary to assert jurisdiction; or (3) necessary to protect or effectuate a prior judgment
by a federal court. Id.; St. Paul Mercury Ins. Co., 332 F.3d at 308-09. The third exception is
referred to as the “relitigation” exception. “The relitigation exception was designed to permit a
federal court to prevent state litigation of an issue that previously was presented to and decided by
the federal court. It is founded in the well-recognized concepts of res judicata and collateral
estoppel.” Chick Kam Choo v. Exxon Corp., 486 U.S. 140, 147 (1988).
There are two related doctrines of preclusion: (1) claim preclusion, commonly referred to as
res judicata, and (2) issue preclusion, known as collateral estoppel. See Montana v. United States,
4
440 U.S. 147, 153 (1979). In order to determine if the relitigation exception to the Anti-Injunction
Act is applicable to preclude litigation of a claim in state court under the doctrine of res judicata, this
court applies a four-part test. “First, the parties in a later action must be identical to (or at least in
privity with) the parties in a prior action. Second, the judgment in the prior action must have been
rendered by a court of competent jurisdiction. Third, the prior action must have concluded with a
final judgment on the merits. Fourth, the same claim or cause of action must be involved in both
suits.” N.Y. Life Ins. Co. v. Gillispie, 203 F.3d 384, 387 (5th Cir. 2000) (quoting United States v.
Shanbaum, 10 F.3d 305, 310 (5th Cir. 1994)). The doctrine of collateral estoppel applies to prevent
issues of ultimate fact from being relitigated between the same parties in a future lawsuit if those
issues have once been determined by a valid and final judgment. Ashe v. Swenson, 397 U.S. 436, 443
(1970); RESTATEMENT (SECOND) OF JUDGMENTS § 27 (1982) (“When an issue of fact or law is
actually litigated and determined by a valid and final judgment, and the determination is essential to
the judgment, the determination is conclusive in a subsequent action between parties, whether on the
same or a different claim.”) (cited in Grogan v. Garner, 498 U.S. 279, 284 (1991)). While complete
identity of all parties is not required, the party against whom the collateral estoppel would be applied
generally must either have been a party, or privy to a party, in the prior litigation. See Terrell v.
DeConna., 877 F.2d 1267, 1270 (5th Cir. 1989).
Vines and McGraw concede that there was a judgment by a court of competent jurisdiction
in the ADEA claim brought by the EEOC and that it was a final judgment on the merits.
III
The issue this court must decide initially is whether, even if the state court mistakenly rejected
ULM’s res judicata claim, a federal court injunction is permitted against enforcement of the state
5
court judgment. The Supreme Court has stated that “[o]nce the state court has finally rejected a
claim of res judicata, then the Full Faith and Credit Act becomes applicable and federal courts must
turn to state law to determine the preclusive effect of the state court’s decision.” Parsons Steel, Inc.
v. First Ala. Bank, 474 U.S. 518, 524 (1986) (emphasis added). The Full Faith and Credit Act
requires federal courts as well as state courts to give state judicial proceedings “the same full faith
and credit in every court within the United States and its Territories and Possessions as they have by
law or usage in the courts of such State, Territory or Possession from which they are taken.” 28
U.S.C. § 1738 (2004).
This court must determine whether the Louisiana state court decision, that the prior federal
adjudication of the EEOC’s claims does not bar the state court proceedings, would be given
preclusive effect under Louisiana law and therefore be entitled to full faith and credit. See Migra v.
Warren City Sch. Dist. Bd. of Educ., 465 U.S. 75, 81 (1984). Under Louisiana law, in order for a
judgment to be entitled to preclusive effect it must be a final judgment. LA. REV. STAT. ANN. §
13:4231 (2004). Louisiana law distinguishes between interlocutory judgments and final judgments.
“A judgment that does not determine the merits but only preliminary matters in the course of an
action is an interlocutory judgment.” LA. CODE CIV. PROC. ANN. art. 1841 (2004). On the other
hand, “[a] judgment that determines the merits in whole or in part is a final judgment.” Id.
The state trial court in this case granted ULM’s peremptory exception of res judicata, but the
Louisiana Second Circuit Court of Appeal overruled the trial court’s decision and remanded the case
for a trial on the merits. Under Louisiana law, t he overruling of a peremptory exception is an
interlocutory judgment and thus not entitled to preclusive effect. See Marsh Eng’g, Inc. v. Parker,
680 So.2d 637, 638 (La. 09/27/96); Bellard v. Biddle, 834 So.2d 1238, 1241 (La. App. 3 Cir.
6
12/30/02). The Louisiana Supreme Court’s denial of ULM’s writ also did not decide the merits of
the res judicata issue, but only allowed the interlocutory ruling to stand pending further review at a
later stage of the proceeding. Id. Therefore, because the state courts’ rulings on the res judicata
issue were interlocutory and not final, a federal court may enjoin Vines and McGraw from relitigating,
through a state court action, issues already decided against them in federal court.
IV
The district court concluded that Vines and McGraw could proceed with their Louisiana age
discrimination suit, holding that they were not bound by the federal court decision because they were
not a party in that suit nor was there privity between the EEOC and the individual plaintiffs. The
district court adopted the magistrate judge’s report and recommendation which accepted the ruling
of the Louisiana Second Circuit Court of Appeals. Vines, 839 So.2d 979. The Loui siana court
reasoned that because Vines and McGraw were denied an opportunity to assert their state claims in
federal court, they maintained the right to sue under the state statutory scheme since the EEOC had
no standing to prosecute such claims under Louisiana law. Id. at 987. The opinion also noted that
the EEOC action was not prosecuted solely for the individual benefits of Vines and McGraw, but
rather for the general public interest. Id. Finally, the state court held that Vines and McGraw had
no control over the conduct of the suit prosecuted by the EEOC. Id.
Whether the district court may file an injunction under the Anti-Injunction Act hinges on
whether the EEOC was in privity with Vines and McGraw. Privity is a “legal conclusion that the
relationship between the one who is a party on the record and the non-party is sufficiently close to
afford application of the principle of preclusion.” Southwest Airlines Co. v. Tex. Int’l Airlines, 546
F.2d 84, 95 (5th Cir. 1977). Federal courts have consistently held that a non-party to an action is still
7
bound by and entitled to the benefits of a judgment as though it were a party if it was represented in
the original action. See Meza v. Gen. Battery Corp., 908 F.2d 1262, 1266-67 (5th Cir. 1990). It is
well-settled precedent that a judgment in an action in which a government agency represents private
individuals is binding on those individuals. See Heckman v. United States, 224 U.S. 413, 445-46
(1912). The EEOC is an agency expressly invested by law with the authority to represent the
interests of individuals in civil actions against employers to recover damages for discriminatory
practices. 42 U.S.C. § 2000e-5 (2004). We conclude that the EEOC did represent Vines and
McGraw for res judicata and collateral estoppel purposes in the federal case brought against ULM.
In Jones v. Bell Helicopter Co., this court considered the issue of “whether an individual may
bring a private Title VII action, based on the same claim at issue in an earlier action brought by the
[EEOC], when the Commission’s act ion is set aside for failure to comply with the Administrative
Procedure Act.”2 614 F.2d 1389, 1389 (5th Cir. 1980). This court held that despite the EEOC’s
“ineptitude, sloth, and indifference” in failing to promptly pursue legal action on his behalf, res
judicata barred the individual from pursuing the same claim because privity existed between him and
the EEOC. Id. at 1391. This decision, however, preceded the Supreme Court’s decision in General
Telephone. Co. of the Northwest, Inc. v. EEOC which discussed how the interests of the EEOC and
of the individual may be divergent. 446 U.S. 318, 326 (1980); see also Riddle v. Cerro Wire and
Cable Group, Inc., 902 F.2d 918, 923 (11th Cir. 1990). Also, unlike Jones, this is an ADEA claim
and not a Title VII case. The distinctive enforcement scheme of the ADEA terminates the right of
an individual to pursue an action once the EEOC commences an action to enforce the employee’s
2
The district court found that the EEOC had delayed its determination of cause and the
issuance of the conciliation letters for 5-7 years in violation of the Administrative Procedure Act.
8
rights under the statute, whereas the enforcement scheme of Title VII does not terminate the rights
of the employee once the EEOC brings a suit. 29 U.S.C. 626(c)(1) (“the right of any person to bring
such action shall terminate upon the commencement of an action by the [EEOC] to enforce the right
of such employee under [the ADEA]”). Therefore, the EEOC is not always to be considered the
representative of individuals on whose behalf it brings an ADEA action. For example, the EEOC’s
role differs when it seeks to enjoin discrimination against an entire class or attempts to protect a
broader interest than simply that of the individual plaintiff. In a situation where there is a clear
divergence of interests between the EEOC and the aggrieved individual, we must determine in each
case whether privity exists. This is not the situation in the present case and we express no view
regarding the question of whether the doctrine of representative claim preclusion would apply in such
a case.
In the present case, it is clear that the EEOC’s interest did not diverge from that of Vines and
McGraw. When the EEOC seeks private benefits for individuals under the ADEA, it takes on
representative responsibilities that places it in privity with those individuals. Although this court has
not addressed this specific issue, several other circuit s have reached this conclusion. The Third
Circuit held that the “ADEA’s distinctive enforcement scheme gives the EEOC representative
responsibilities when it seeks private benefits for an individual and that the doctrine of representative
claim preclusion must therefore be applied.” EEOC v. U.S. Steel Corp., 921 F.2d 489, 495 (3d Cir.
1990). In U.S. Steel Corp. the EEOC filed a complaint alleging that the United States Steel
Corporation had violated the ADEA because employees were required to sign waivers as a condition
for obtaining more favorable retirement benefits. Several employees had been unsuccessful with their
individual suits on the same claim. The district court granted relief in the EEOC’s case, including a
9
permanent injunction against requiring the release. The district court also determined that the earlier
judgments against the individuals did not preclude retroactive relief. The Third Circuit focused on
the “distinctive scheme” of the ADEA in reversing the district court, reasoning that the ADEA
intended for the EEOC to act as the representative for individual employees when it sought to recover
individual benefits for them, which is demonstrated by the fact that the individual’s right to sue is cut
off once the EEOC begins an action. Id.; 29 U.S.C. § 626(c)(1). The court viewed “the provision
of the ADEA prohibiting private suits once the EEOC files its complaint as essentially a codification
of the doctrine of representative claim preclusion with respect to those instances in which the EEOC
litigates first: litigation by the representative party (the EEOC) seeking private relief for an individual
precludes subsequent litigation of the same claim by an individual for whom the representative sought
relief.” U.S. Steel Corp., 921 F.2d at 495.
Several other courts have followed the reasoning of the Third Circuit in U.S. Steel Corp.,
recognizing that the ADEA places the EEOC in privity with individuals for whom it seeks relief such
that a lawsuit litigated by either the EEOC or the individual bars subsequent relitigation of the same
claims or issues. The Seventh Circuit held that the EEOC was barred from recovering back pay or
liquidated damages on behalf of an individual who had previously litigated the same claim without
success, stating that they “agree[d], generally, with the Third Circuit’s position that there is privity
between the EEOC and individuals for whom it seeks individual benefits.” EEOC v. Harris Chernin,
Inc., 10 F.3d 1286, 1291 (7th Cir. 1993). The Second Circuit also concluded that the statutory
enforcement mechanism of the ADEA “gives the EEOC representative responsibilities when it seeks
private benefits for an individual.” EEOC v. Kidder, Peabody & Co., 156 F.3d 298, 302 (2nd Cir.
1998) (quoting U.S. Steel Corp., 921 F.2d at 495), overruled on other grounds, EEOC v. Waffle
10
House, Inc., 534 U.S. 279 (2002). Several district courts have also considered the issue and have
reached the same conclusion. See EEOC v. TIC-The Indus. Co., et al., No. 01-1776, 2002 U.S.
Dist. LEXIS 22728, at *8 (E.D. La. Nov. 21, 2002) (“the concl usion that the EEOC is the
individual’s representative in ADEA suits. . .seems inescapable.”); Mohammed v. May Dep’t Stores,
273 F.Supp.2d 531, 535 (D. Del. 2003); EEOC v. Luce, Forward, Hamilton & Scripps, 122
F.Supp.2d 1080, 1087-88 (C.D. Cal. 2000); EEOC v. Nebco Evans Distrib. Inc., No. 8:CV96-
00644, 1997 U.S. Dist. LEXIS 23111, at *11-12 (D. Neb. June 5, 1997).
The Second Circuit Court of Appeal in Louisiana relied almost entirely on the California state
appellate court’s decision in Victa v. Merle Norman Cosmetics, Inc. in holding that privity did not
exist between the EEOC and Vines and McGraw. 19 Cal.App.4th 454 (1993). In Victa, the state
court determined that an action in federal court brought by the EEOC under the ADEA claiming age
discrimination did not serve as a res judicata bar to the individual plaintiff’s state law age
discrimination suit in state court. The individual plaintiff proceeded with her state court claim after
the EEOC and the defendant in the federal suit agreed upon a stipulated judgment that included only
injunctive relief. The court noted that “[a]lthough the complaint stated that the EEOC was bringing
the case both to correct unlawful employment practices [of the defendant] and to make plaintiff
whole, by the time it agreed to the judgment the EEOC had dispensed with plaintiff’s particular
interest, and was content to dismiss the case in exchange for [defendant’s] submission to a general
injunction. Surely, in obtaining the judgment here urged as res judicata the EEOC did not act as
plaintiff’s representative.” Id. at 468.
The EEOC plays a dual role under the enforcement scheme of the ADEA, both protecting the
public interest and vindicating specific private claims by seeking individual relief on their behalf. See
11
Gen. Tel. Co. of the Northwest, 446 U.S. at 331; U.S. Steel Corp., 921 F.2d at 496. The
responsibilities of each of these roles, however, does not necessarily conflict. Unlike in Victa, the
EEOC in this case never abandoned the interests of the individual plaintiffs. The EEOC acted as
Vines’ and McGraw’s representative in seeking monetary, “make-whole” relief in the federal case,
the same relief they now seek in their state court action.3
The district court and the Louisiana Second Circuit reasoned that by expanding the class of
victims in the suit to include others similarly situated with the plaintiffs, the EEOC was no longer
prosecuting the action solely for Vines and McGraw, but in effect representing the general public.
Therefore, the court concluded that privity did not exist because the EEOC sought to enjoin
discrimination against a class of victims, not just the plaintiffs. The Louisiana court, however, failed
to explain how any conflict of interest was created by the EEOC expanding the class of victims or by
also seeking injunctive relief. Unlike in Victa, the EEOC did not seek as its sole relief a general
injunction. The EEOC continued to pursue monetary, “make-whole” relief for Vines and McGraw,
in addition to an injunction against ULM’s practices.
The district court’s contention that the absence of control by Vines and McGraw over the
conduct of the suit by the EEOC prevented the suit from operating as a bar to their state court claims
must also be rejected. “The absence of any formal designation of the individual claimants as parties
. . . does not change the nature of the EEOC’s role as the individuals’ representative and should not
change the effect of the doctrine of claim preclusion. By claiming or accepting individual relief won
by the EEOC, the individual would necessarily concede that the EEOC was their representative and
3
In its complaint, the EEOC sought “make-whole” relief for Vines and McGraw, including
“backpay, frontpay, with prejudgment interest,. . .with general compensatory damages.” R. Vol. 15
at p. 7.
12
that they were embraced by the EEOC’s judgment.” U.S. Steel Corp., 921 F.2d at 496. Vines and
McGraw were named in the EEOC suit and there is no question that had the EEOC won its claim
against ULM that they would have accepted the individual relief. Therefore, even if it is conceded
that Vines and McGraw did not have any control over the federal suit, it does not affect the preclusive
effects of the decision on their current state suit.
Vines and McGraw attempt to distinguish this case from the decisions in U.S. Steel Corp. and
the other courts which have considered the issue by arguing that the sequence in which the duplicative
lawsuits are filed or resolved determines whether privity applies. The doctrine of representative claim
preclusion, however, applies equally regardless of the order of litigation. U.S. Steel Corp., 921 F.2d
at 493.
V
Res judicata requires that the same claim or cause of action be involved in both proceedings
and the doctrine of collateral estoppel requires that the same issue of fact or law be actually litigated
and determined in a prior judgment. N.Y. Life Ins. Co., 203 F.3d at 387; Ashe, 397 U.S. at 443.
Federal law of res judicata “bars all claims that were or could have been advanced in support of the
causes of action on the occasion of its former adjudication, not merely those that were adjudicated.”
Nilsen v. City of Moss Point, 701 F.2d 556, 560 (5th Cir. 1983) (emphasis omitted). Federal courts
“use a transactional test to determine whether two claims involve the same cause of action, under
which the critical question is ‘not the relief requested or the theory asserted but whether the plaintiff
bases the two actions on the same nucleus of operative facts.’” N.Y. Life Ins. Co., 203 F.3d at 387
(quoting Agrilectric Power Partners v. Gen. Elec. Co., 20 F.3d 663, 665 (5th Cir. 1994)).
“Collateral estoppel does not preclude litigation of an issue unless both the facts and the legal
13
standard used to assess them are the same in both proceedings.” Copeland v. Merrill Lynch & Co.,
Inc., 47 F.3d 1415, 1422 (5th Cir. 1995).
The state claims brought by Vines and McGraw and the federal suit brought by the EEOC are
both age discrimination suits.4 Each complaint alleged that ULM maintained a policy of paying state
retirees lower wages and assigned them greater workloads than those who were not state retirees.5
The state claim was brought under the Louisiana Employment Discrimination Law (“LAEDL”)6 and
the federal suit was brought under the ADEA. The two statutes are substantively similar and federal
and state courts routinely follow cases interpreting the ADEA when evaluating claims brought under
the LAEDL, recognizing the same burden of proof and defenses. See Hypes v. First Commerce
Corp., 134 F.3d 721, 726 (5th Cir. 1998); Deloach v. Delchamps, Inc., 897 F.2d 815, 818 (5th Cir.
1990); Montgomery v. Lobman, Carnahan, Batt & Angelle, 729 So.2d 1075, 1077 (La.App. 4 Cir.
1999).
Both the federal suit brought by the EEOC and the state court suit brought by Vines and
4
The EEOC complaint stated: “The Board’s policy openly discriminates against employees
on the basis of age.” Vines and McGraw’s complaint stated: “The Defendant Board discriminated
against the plaintiffs’ on the basis of their age. . .”
5
The EEOC complaint stated: “The University admittedly paid Vines and McGraw less than
non-retirees because of their retired status. The University assigned heavier workloads to retired non-
tenure-track professors than to non-retired (younger) non-tenure track professors.” Vines and
McGraw’s complaint similarly alleged: “During their tenure with [ULM] following their retirement
through the TRSL, the Defendant [ULM] assigned them additional courses to teach than younger
professors and paid them less salary than their younger counterparts. [ULM] violated the ADEA and
[LAEDL] with these practices.”
6
Vines and McGraw filed their lawsuits under LA. REV. STAT. ANN. §§ 23:971 et seq. and
51:2232 et seq. After the filing of their lawsuits, the Louisiana Legislature amended the statutes and
combined the antidiscrimination laws into one statute, LA. REV. STAT. ANN. § 23:301 et. seq, entitled
the Louisiana Employment Discrimination Law.
14
McGraw involve claims that arise out of precisely the same set of facts7, raise the same issues
(including whether ULM discriminated against the individual plaintiffs in their pay, workloads and
non-renewal of their contracts because of age), and seek monetary relief for Vines and McGraw.8
The language in the complaints demonstrates the similarity between the two suits. The district court
judge in the federal suit recognized that the claims involved the same facts and issues and
consolidated Vines’ and McGraw’s state claims with the EEOC action.9
The district court ultimately held that ULM had “legitimate nondiscriminatory reasons for
paying lower salaries to and not renewing the contracts of Vines and McGraw” and that the “EEOC
ha[d] not produced sufficient evidence to show that the reasons were pretext for age discrimination.”
Collateral estoppel applies to preclude Vines and McGraw from relitigating these issues in their state
court age discrimination action because they involve the same issues of ultimate fact that have been
determined by a valid and final prior judgment.10
7
The facts at issue in each suit, discussed supra, are not disputed by either party.
8
The EEOC’s complaint requested as relief that the court: “make whole [Vines and
McGraw]. . .by providing appropriate backpay with prejudgment interest, in amounts to be
determined at trial, and other affirmative relief necessary to eradicate the effects of [ULM’s] unlawful
employment practices. Order [ULM] to make whole [Vines and McGraw]. . .by paying liquidated
damages in an amount equal to back wages, plus prejudgment interest. . .” Vines and McGraw’s
complaint requested as relief: “general compensatory damages for pain and suffering and mental
anguish and distress, for liquidated damages pursuant to the ADEA, for attorney’s fees and costs in
this action, and for all general and equitable relief.”
9
The district court was forced to dismiss Vines’ and McGraw’s ADEA claims after the EEOC
brought its action. It also remanded the state claims to state court.
10
The state court suit, however, would not be barred by res judicata. The state court suit
involves a claim under the LAEDL and the prior federal court decision adjudicated the EEOC’s
ADEA claim. Therefore, the same claim or cause of action is not being advanced in this suit as in the
prior federal suit. Nilsen, 701 F.2d at 560. The EEOC also did not have standing to prosecute the
state claims under Louisiana law and thus could not have brought the action that Vines and McGraw
15
VI
Vines and McGraw contend that, even if it is determined that the elements of res judicata or
collateral estoppel are satisfied, they should not be precluded from proceeding with their state court
claim. They argue that the EEOC failed to adequately represent them in the federal suit by voluntarily
dismissing its appeal and that their state law claims were preserved when the federal court declined
jurisdiction over the claims and remanded the state causes of action to the state court. We reject both
arguments.
A
The district court in the federal case granted ULM’s motion for summary judgment,
dismissing the EEOC’s case. Although the EEOC filed a Notice of Appeal, it withdrew its appeal.
Vines and McGraw argue that the EEOC did not adequately represent them because the EEOC
voluntarily dismissed its appeal in the federal case. As a result, they argue that res judicata and
collateral estoppel cannot act as a bar to their state lawsuits.
Vines and McGraw assert that the proper test to determine adequate representation is
whether the representative “vigorously and tenaciously protected the interests of the class” and so
long as an appeal could not be characterized as patently meritless or frivolous, a representative must
pursue an appeal or they will be considered to have provided inadequate representation.11 This court,
in Gonzalez v. Cassidy, refused to bar a subsequent lawsuit by a member of a class represented in a
class action lawsuit because the class representative had not adequately represented the interests of
bring in the current suit. Id.
11
The magistrate judge, in her report and recommendation, stated that even if there was
privity between the EEOC and the individual plaintiffs, the EEOC failed to adequately represent their
claims based on this reasoning.
16
the class. 474 F.2d 67, 75-76 (5th Cir. 1973). We held that the failure of the class representative to
appeal from a judgment which granted him relief, while denying relief to other class members,
rendered his representation of the class inadequate so as to preclude res judicata from attaching to
that judgment. Id. at 75. The court noted that the class representative “vigorously represented the
class until he obtained individual relief.” Id. at 76.
Gonzalez and the other cases cited by Vines and McGraw in support of their “adequacy”
argument were class action cases in which the courts were required under FED. R. CIV. P. 23 to
determine whether the class representative adequately represented absent members of the class . The
procedural rules of Rule 23, however, do not apply to EEOC representative actions under the ADEA.
Gen. Tel. Co. of the Northwest, Inc., 446 U.S. at 330.
The record establishes that the EEOC acted with due diligence and reasonable prudence.
They conducted and participated in discovery, filed motions for summary judgment, and responded
to motions filed by ULM. The EEOC did not inadequately represent Vines and McGraw simply
because it made a calculated decision to voluntarily dismiss its appeal.12
B
Vines and McGraw argue that when a federal court declines jurisdiction over a state law claim
in a federal lawsuit and remands the state cause of action to the state court that the state law claim
is preserved and not subject to res judicata or collateral estoppel. In King v. Provident Life and
Accident Insurance Co., the plaintiff originally filed a lawsuit in state court for causes of action under
12
The RESTATEMENT (SECOND) OF JUDGMENTS states that “[a] person i s not bound by a
judgment for or against a party who purports to represent him if. . .The representative failed to
prosecute or defend the action with due diligence and reasonable prudence. . .” § 42 (1982); see also
Mohammed, 273 F.Supp.2d at 535.
17
ERISA as well as state claims pertaining to an inadequate opportunity to convert an insurance policy.
23 F.3d 926 (5th Cir. 1994). The defendant removed the case to federal court where its motion for
summary judgment was granted, dismissing all the claims except the state law claims. The district
court judge specifically stated that “plaintiffs, of course, retain the right to file another lawsuit with
regard to [the state law claims].” Id. at 928. We held that the district court’s language limited the
preclusive effect of the dismissal of the federal claims, reasoning that a court has the ability to control
the preclusive consequences of its rulings. Id. “Despite the general rule that a court cannot dictate
preclusion consequences at the time of deciding a first action, it should have power to narrow the
ordinary rules of claim preclusion. A judgment that expressly leaves open the opportunity to bring
a second action on specified parts of the claim or cause of action that was advanced in the first action
should be effective to forestall preclusion.”13 Id. (quoting 18 CHARLES A. WRIGHT ET. AL., FEDERAL
PRACTICE & PROCEDURE § 4413 (1981)).
Unlike King, in which the district court specifically stated that plaintiffs retained the right to
file another lawsuit, the district court judge made no such reservation of rights in either the remand
order or the final judgment in this case. Absent an express reservation, res judicata applies to bar a
second suit. Therefore, when two suits are pending based on the same claim or issue, the first final
judgment rendered becomes conclusive in the other action. Ellis v. Amex Life Ins. Co., 211 F.3d 935,
937 (5th Cir. 2000); see also LA. CODE CIV. PROC. ANN. art. 531 (1999).
13
The RESTATEMENT (SECOND) OF JUDGMENTS § 26 (1982) (emphasis added) also states that:
(1) When any of the following circumstances exists, the general rule of § 24 does not apply
to extinguish the claim, and part or all of the claim subsists as a possible basis for a second
action by the plaintiff against the defendant:. . .
(b) The court in the first action has expressly reserved t he plaintiff’s right to maintain the
second action. . .
18
VII
Because all of the elements of collateral estoppel have been satisfied, we find that this case
falls within the boundaries of the relitigation exception to the Anti-Injunction Act. Accordingly, we
REVERSE the judgment of the district court and REMAND the case for issuance of a permanent
injunction enjoining Vines and McGraw from proceeding with their state court age discrimination suit
against ULM.
19