Twice this year we have reported on trial-court decisions addressing application of offensive non-mutual collateral estoppel—an offensive doctrine that precludes a defendant from relitigating an issue that it lost in earlier litigation against a different plaintiff. One court applied it; the other refused to. Today we report on a Sixth Circuit decision that affirmed, over a spirited dissent, application of the doctrine in a follow-on MDL case.
Our earlier posts catalog the doctrine’s unfair, pernicious results. A quick refresher:
Offensive non-mutual collateral estoppel risks perpetuating an erroneous result by preventing relitigation of issues previously decided against a defendant. If applied, the doctrine can give disproportionate—and potentially dispositive—weight to the decision of a lone judge or jury, no matter how wrong that decision.
The fact that an adverse judgment in one case can cripple a company’s defense in subsequent cases has two adverse consequences apart from the danger of perpetuating error. First, it gives plaintiffs tremendous leverage in settlement negotiations. Second, it induces defendants to spend much more litigating a case than would be warranted by the amount nominally in dispute.