Tarah Sahlberg v. P.S.C. Inc.

626 F. App'x 719

• Court: Court of Appeals for the Ninth Circuit
• Decided: September 29, 2015
• Docket: 13-35651
• Status: Unpublished

Opinion

MEMORANDUM *

Tarah Sahlberg appeals the district court’s summary judgment dismissing her claims against P.S.C., Inc. and Adams & Adams Law under the Fair Debt Collec tion Practices Act (FDCPA) and the Washington Consumer Protection Act (CPA). In 2012, Adams & Adams brought a collection action on behalf of its client P.S.C. against Sahlberg in King County Superior Court. Sahlberg raised - affirmative defenses, including violations of the FDCPA and the CPA. The Superior Court granted summary judgment in favor of P.S.C. Weeks later, Sahlberg filed this suit in federal court alleging violations of the FDCPA and CPA against P.S.C. and Adams & Adams. The district court granted summary judgment on thq grounds of res judicata and collateral es-toppel. We have jurisdiction under 28 U.S.C. § 1291, and we affirm. 1

We review a grant of summary judgment de novo. Clark v. Bear Stearns & Co., Inc., 966 F.2d 1318, 1320 (9th Cir.1992). We apply Washington State law to determine the preclusive effect of the state court judgment. See Kremer v. Chem. Constr. Corp., 456 U.S. 461, 466, 102 S.Ct. 1883, 72 L.Ed.2d 262 (1982); 28 U.S.C. § 1738. Under Washington law, res judicata “prohibits the relitigation of claims and issues that were litigated, or could have been litigated, in a prior action.” Pederson v. Potter, 103 Wash.App. 62, 11 P.3d 833, 835 (2000) (citing Loveridge v. Fred Meyer, Inc., 125 Wash.2d 759, 887 P.2d 898, 900 (1995) (en banc)). For a subsequent action to be barred by res judicata, the prior judgment must be a final judgment on the merits, and the prior and subsequent actions must have identical (1) persons and parties, (2) causes of action, (3) subject matter, and (4) quality of persons for or against whom the claim is made. Id. In considering whether two causes of action are identical, Washington courts consider: “(1) [Wjhether rights or interests established in the prior judgment would be destroyed or impaired by prosecution of the second action; (2) whether substantially the same evidence is presented in the two actions; (3) whether the two suits involve infringement of the same right; and (4) whether the two suits arise out of the same transactional nucleus of facts.” Rains v. State, 100 Wash.2d 660, 674 P.2d 165, 168 (1983) (en banc) (quoting Costantini v. Trans World Airlines, 681 F.2d 1199, 1201-02 (9th Cir.1982)).

Sahlberg’s claims against P.S.C. are barred by res judicata. The state court’s entry of summary judgment in favor of P.S.C. was a final judgment on the merits. See Ensley v. Pitcher, 152 Wash. App. 891, 222 P.3d 99, 103 (2009). Both the prior state court litigation and , the subsequent federal court litigation involved Sahlberg and P.S.C., so there are identical parties and quality of persons in both actions. Pederson, 11 P.3d at 838. The subject matter of the affirmative defenses to the state suit and the federal claims here is the same. There are also identical causes of action: P.S.C.’s rights established in the state court judgment would be impaired by, Sahlberg’s federal court action, and both suits present substantially the same evidence, involve the, infringement of the same rights, and arise from the same transactional nucleus of facts. Although Sahlberg asserted the FDCPA and CPA claims as affirmative defenses, under Washington law the doctrine of res judicata applies equally to claims and affirmative defenses. See Symington v. Hudson, 40 Wash.2d 331, 243 P.2d 484, 488 (1952); Fed. Deposit Ins. Corp. v. Davidyuk, No. C13-1592JLR, 2014 WL 2893309, at *11 (W.D.Wash. June 25, 2014).

We next address the claims relating to Adams & Adams. Under Washington law,- collateral estoppel applies when the following elements are met: “(1) identical issues; (2) a final judgment on the merits; (3) the party against whom the plea is asserted must have been a party to or in privity with a party to the prior adjudication; and (4) application of the doctrine must not work an injustice on the party against whom the doctrine is to be applied.” Southcenter Joint Venture v. Nat’l Democratic Policy Comm., 113 Wash.2d 413, 780 P.2d 1282, 1284 (1989) (en banc) (quoting Shoemaker v. Bremerton, 109 Wash.2d 504, 745 P.2d 858, 860 (1987) (en banc)). The issue must also have been material and essential to the first judgment. See East v. Fields, 42 Wash.2d 924, 259 P.2d 639, 640 (1953) (en banc). Washington courts “apply nonmu-tual collateral estoppel so long as the party against whom preclusion is sought was a party or in privity with a party to the prior litigation and had a full and fair opportunity to litigate the issue in question.” State v. Mullin-Coston, 152 Wash.2d 107, 95 P.3d 321, 324 (2004) (en banc). Although res judicata bars claims that could have been raised in a prior action, Pederson, 11 P.3d at 835, collateral estoppel bars issues that were previously raised and litigated. Yakima Cnty. v. Yakima Cnty. Law Enforcement Officers Guild, 157 Wash.App. 304, 237 P.3d 316, 331 (2010).

Sahlberg’s claims against Adams & Adams are barred by collateral estoppel. The issues raised are identical to those raised in' the state court, where. Sahlberg’s counsel alleged violations of the FDCPA and CPA as affirmative defenses. Summary judgment is a final judgment on the merits. Sahlberg, the party against whom collateral estoppel is asserted, was a party in the prior adjudication. There is no injustice to Sahlberg, who had the opportunity to litigate her FDCPA and CPA claims in the prior state court action. The state court decision, rendering summary judgment for P.S.C. against Sahlberg, necessarily rejected the affirmative defenses that Sahlberg had raised. This rejection of the affirmative defenses based on the FDCPA and CPA claims was material and essential to the state court’s decision to award summary judgment. The issues were actually litigated, and collateral es-toppel applies to preclude claims here against Adams & Adams based on the FDCPA and CPA.

AFFIRMED.

* This disposition is not appropriate for publication and is not precedent except as provided by 9th Cir. R. 36-3,

1 . We also deny Sahlberg's Motion for Leave to File Supplemental Brief,