FILED
NOT FOR PUBLICATION
AUG 15 2016
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
DAVID E. OLSON and ABSOLUTE No. 14-35795
ENVIRONMENTAL SERVICES, INC.,
D.C. No. 3:11-cv-00245-JWS
Plaintiffs-Appellants,
v. MEMORANDUM*
MARK O’BRIEN; et al.,
Defendants-Appellees.
Appeal from the United States District Court
for the District of Alaska
John W. Sedwick, District Judge, Presiding
Argued and Submitted August 3, 2016
Anchorage, Alaska
Before: FISHER, PAEZ, and HURWITZ, Circuit Judges.
Plaintiffs David E. Olson and Absolute Environmental Services, Inc.
(“Plaintiffs”) appeal the dismissal of their claims against Mark O’Brien, James
Cantor, and Richard Welsh on res judicata grounds. We reverse and remand for
further proceedings.
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
1. In evaluating whether res judicata bars litigation in federal court after related
state court litigation, we “give to a state-court judgment the same preclusive effect
as would be given that judgment under the law of the State in which the judgment
was rendered.” Migra v. Warren City Sch. Dist. Bd. of Educ., 465 U.S. 75, 81
(1984). In Alaska, “[t]he elements necessary to the doctrine’s application are (1) a
final judgment on the merits, (2) from a court of competent jurisdiction, (3) in a
dispute between the same parties (or their privies) about the same cause of action.”
Conitz v. Alaska State Comm’n for Human Rights, 325 P.3d 501, 507 (Alaska
2014) (internal quotation marks omitted). In addition, res judicata does not apply
where the party against whom it is asserted “lacked [a] ‘full and fair opportunity to
litigate his claims.’” Id. at 508 (quoting Beegan v. State, Dep’t of Transp. & Pub.
Facilities, 195 P.3d 134, 139 (Alaska 2008)).
Plaintiffs did not have a full and fair opportunity to litigate their claims in
the prior state court proceeding. The prior proceeding was an administrative
appeal of a construction contract dispute. Alaska Stat. § 36.30.627; Alaska R.
App. P. 609(b). Although the superior court held a limited trial de novo to
investigate alleged improprieties in the decision-making process of the Department
of Transportation and Public Facilities (“DOTPF”), the scope of the court’s inquiry
was limited to reviewing the decision of the DOTPF to deny additional
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compensation under the contract. Plaintiffs could have brought their additional
damages claims in a separate suit; we are not persuaded, however, they would have
had a full and fair opportunity to litigate those claims within their administrative
appeal. See Balough v. Fairbanks North Star Borough, 995 P.2d 245, 256 (Alaska
2000) (holding that the superior court did not abuse its discretion in bifurcating a
litigant’s claims into an administrative appeal and a separate § 1983 claim); see
also J & S Servs., Inc. v. Tomter, 139 P.3d 544, 548-49 (Alaska 2006) (holding that
an unsuccessful bidder for a state contract was permitted to file a claim against
agency officials separate from its administrative appeal, but not discussing res
judicata). Thus, the district court erred in dismissing Plaintiffs’ claims on res
judicata grounds.
2. Defendants argue, in the alternative, that collateral estoppel bars Plaintiffs’
claims. Because the district court dismissed the case on res judicata grounds, it did
not reach this issue. We therefore remand for the district court to determine in the
first instance whether some or all of Plaintiffs’ claims are barred by collateral
estoppel.
REVERSED and REMANDED.
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