119.1 General principles

No prejudice arises when the decision-maker raises the matter of issue preclusion, sua sponte, provided the Complainant’s attorney is given an opportunity to brief the issue and show why issue preclusion would not be appropriate. Lofton v. State of Wis. Dep't of Corr. (LIRC, 09/27/18).

The party asserting issue preclusion has the burden of establishing: 1) that the issue was actually litigated and determined in the prior proceeding by a valid judgment, and the determination was essential to the judgment; and 2) that applying issue preclusion comports with principles of fundamental fairness. The Complainant argued that his case in federal court was not actually litigated because he did not know how to respond to the Respondent’s motion for summary judgment. That fact is immaterial to whether the case was actually litigated. The material question is whether the court decided liability after affording the parties an opportunity to present factual assertions on the merits of the Complainant’s claims. That is what happened in this case. One of the five factors indicating whether issue preclusion comports with fundamental fairness is whether the legal questions in the two forums involved distinct claims or intervening contextual shifts in the law. The Complainant argued that federal and state laws were different in the areas of age discrimination and disability discrimination. While it is true that the federal and state laws are not identical, they were similar enough to make it apparent that the federal court’s acceptance of the Respondent’s proposed findings of fact in federal court rendered the Complainant’s state-based claims not viable. McKnight v. Milwaukee Pub. Sch. (LIRC, 04/19/18).

Issue preclusion may be waived if not timely raised. In this case it was waived when not raised until after the Equal Rights Division hearing, in a post-hearing brief. Even if timely raised, however, application of issue preclusion based on a prior decision between the parties before the Wisconsin Employment Relations Commission (WERC) would not pass the fundamental fairness test. See Aldrich v. LIRC, 2012 WI 53, 341 Wis. 2d 36. The proceedings before the Equal Rights Division and the WERC concern different claims - discrimination in the former and just cause for termination in the latter. There are also significant differences in proceedings in the Equal Rights Division and the WERC. Sortedahl v. St. Croix Dist. Attorney’s Office (LIRC, 08/07/17).

The Complainant’s disability discrimination complaint in federal court was functionally the same as her ERD complaint, and both complaints involved the same parties. Claim preclusion operates as a bar to subsequent legal action between the same parties or their privies regarding all matters that were litigated or might have been litigated in the initial action. The Complainant lost her claim in federal court on summary judgment, but claim preclusion cannot bar her ERD complaint because it is well settled that the Complainant could not have litigated her WFEA claims in the federal court action. See, Aldrich v. LIRC, 2008 WI App 63, 310 Wis. 2d 796, 751 N.W.2d 866. Issue preclusion, however, would require dismissal of the ERD complaint. The federal court’s determination that no reasonable jury could have inferred that the Respondent was aware of the Complainant’s alleged physical restrictions or was aware that such restrictions amounted to a disability, if applied to her ERD case, would make it impossible for her to prevail in her ERD case. The five-factor test to determine whether application of issue preclusion comported with fundamental fairness was satisfied. Williams v. Milwaukee Health Srvs. (LIRC, 10/20/15).

The Complainant’s allegation of discrimination based on conviction record was precluded by a prior decision involving the same parties in which a court found that the Complainant’s criminal record was substantially related to the job of truck driver for the Respondent. Jackson v. Klemm Tank Lines (LIRC, 03/26/15).

The Complainant had a full opportunity to litigate her claim before the federal district court and to appeal to the federal court of appeals. However, given the unique circumstances of this case, the doctrine of issue preclusion should not have been applied to prevent the Complainant from re-litigating the issue of whether her claim was timely filed in the administrative forum. The Complainant was not represented by legal counsel at the time that she filed her charge with the EEOC. Further, the United States Supreme Court changed the law affecting the timeliness of EEOC charges after the Complainant filed her charge. Fundamental fairness requires that this case be remanded to LIRC with instructions for LIRC to remand the cause to the Equal Rights Division for further proceedings. Aldrich v. LIRC, 2012 WI 53, 341 Wis. 2d 36, 814 N.W.2d 433. (Aldrich II).

The Complainant could not have litigated her Wisconsin Fair Employment Act claims in federal court. The exclusive means of asserting a claim under the Wisconsin Fair Employment Act is through the Equal Rights Division. Therefore, the doctrine of claim preclusion did not prevent the Complainant from bringing her claims before the Equal Rights Division. However, where appropriate, the narrower doctrine of issue preclusion (which applies only to issues which were actually litigated and decided in a prior action) will prevent re-litigation of identical issues which have been decided in federal court. Aldrich v. LIRC, 2008 WI App 63, 310 Wis. 2d 796, 751 N.W.2d 866 (03/18/08). (Aldrich I).

The first step in analyzing whether issue preclusion applies is to determine whether the issue was actually litigated in the prior proceeding by a valid judgment and whether the determination was essential to the judgment. The fact that the outcome in the federal court proceeding came in a ruling on a motion for summary judgment, rather than after a trial, does not matter. The second step in the analysis is determining whether applying issue preclusion comports with principles of fundamental fairness. This decision should be made with special attention to guarantees of due process which require that a person must have had a fair opportunity procedurally, substantively, and evidentially to pursue the claim before a second litigation will be precluded. In this case, the conditions for the application of issue preclusion were all met. The Complainant could have obtained a review of the judgment as a matter of law. Second, this is not a case where there were two distinct and different types of claims or intervening contextual shifts in the law. Third, there were not significant differences in the quality or extensiveness of the proceedings between the two tribunals which would warrant re-litigation. Fourth, there was no shift in the applicable burdens of persuasion such that the party seeking preclusion had a lower burden of persuasion in the first proceeding. Finally, there were no matters of public policy or individual circumstances involved which would make application of issue preclusion fundamentally unfair. Banty v. Dings Co. Magnetic Group (LIRC, 07/31/12).

For the Equal Rights Division to give preclusive effect to an EEOC investigation result and to dismiss a complaint on that basis without providing an opportunity for hearing would be improper as a matter of law. This is because EEOC investigations are ex parte. They do not allow for any form of confrontation or examination of adverse witnesses, and they are not, standing alone, sufficient to satisfy the requirements of due process. Banty v. Dings Co. Magnetic Group (LIRC, 07/31/12).

In Kruckenberg v. Harvey, 2005 WI 43, 279 Wis. 2d 520, 694 N.W.2d 879, the Supreme Court indicated that when the doctrine of claim preclusion is applied, a final judgment on the merits will ordinarily bar all matters which were litigated or which might have been litigated in the former proceedings. The Court noted that in Wisconsin the doctrine of claim preclusion has three elements: (1) identity between the parties or their privies in the prior and present suits; (2) prior litigation resulted in a final judgment on the merits by a court with jurisdiction; and (3) identity of the causes of action in the two suits. In this case, all of the elements required for application of claim preclusion on the Complainant’s claim of race discrimination before the Equal Rights Division were satisfied. The parties in the Equal Rights Division case were the parties in the prior federal court action. The prior federal court action resulted in a final judgment on the merits of the Complainant’s race discrimination claim which he pursued in federal court. (A summary judgment in favor of a defendant is sufficient to meet the requirements of a conclusive and final judgment.) Finally, since the Complainant’s claim of race discrimination in the Equal Rights Division was based on the same facts underlying his federal court action, an identity of the causes of action or claims existed between his action in federal court and the instant claim before the Equal Rights Division. Rogers v. Wis. Knife Works (LIRC, 12/22/05).

Unlike claim preclusion, which may bar all matters which were litigated or which might have been litigated in the former proceedings, an element of issue preclusion is that the issue was actually litigated in a prior action. A “fundamental fairness” standard exists when applying issue preclusion. That standard requires consideration of the following factors: (1) Could the party against whom preclusion is sought, as a matter of intervening contextual shifts in the law? (3) Do significant differences in the quality or extensiveness of proceedings between the two courts warrant re-litigation of the issue? (4) Have the burdens of persuasion shifted such that the party seeking preclusion had a lower burden of persuasion in the first trial than in the second? and (5) Are matters of public policy and individual circumstances involved that would render the application of issue preclusion to be fundamentally unfair? Rogers v. Wis. Knife Works (LIRC, 12/22/05).

A summary judgment order issued by a federal court is a bar to the Complainant proceeding under state law in a case involving the same parties and claims. The Complainant had an opportunity to litigate his complaint in federal district court and to obtain a review of the district court’s decision by the Court of Appeals. The fact that he disagreed with the federal court decisions issued in his case did not entitle him to relitigate the same claims before the Equal Rights Division. Reed v. Great Lakes Co. (LIRC, 11/21/05).

The burden of proving claim preclusion is upon the party asserting its applicability. Under the doctrine of claim preclusion, a final judgment is conclusive in all subsequent actions between the same parties [or their privies] as to all matters which were litigated or which might have been litigated in the former proceedings. In order for the earlier proceedings to act as a claim-preclusive bar in a subsequent action, the following three factors must be present: (1) identity between the parties or their privies in the prior and present suits; (2) prior litigation which resulted in a final judgment on the merits by a court with jurisdiction; and (3) identity of the causes of action in the two suits. For purposes of claim preclusion, privity exists when a person is so identified in interest with a party to the former litigation that he represents precisely the same legal right in respect to the subject matter involved. In this case, the UW-Madison was the sole Respondent, while the Board of Regents of the University of Wisconsin System was the defendant in the federal proceedings. Because UW-Madison is a unit within the larger University of Wisconsin System, there is identity between the parties or their privies in the two proceedings. Because a final judgment was entered in the prior litigation, and because there was an identity of causes of action, claim preclusion applied in this case. Delgadillo v. UW-Madison (Wis. Pers. Comm’n, 04/30/03).

Under the doctrine of claim preclusion, a final judgment is conclusive in all subsequent actions between the same parties as to all matters which were litigated or which might have been litigated in the former proceedings. In order for an earlier action to act as a claim preclusive bar to a subsequent action the following factors must be present: (1) an identity between the parties or their privies in the prior and present suits; (2) an identity between the causes of action in the two suits; and (3) a final judgment on the merits in a court of competent jurisdiction. Issue preclusion, on the other hand, refers to the effect of a judgment in foreclosing re-litigation in a subsequent action on an issue of law or fact that has been actually litigated and decided in a prior action. A “fundamental fairness” standard exists when applying issue preclusion and requires consideration of the following factors: (1) could the party against whom preclusion is sought, as a matter of law, have obtained review of the judgment; (2) is the question one of law that involves two distinct claims or intervening contextual shifts in the law; (3) did significant differences in the quality or extensiveness of proceedings between the two courts warrant re-litigation of the issue; (4) have the burdens of persuasion shifted such that the parties seeking preclusion had a lower burden of persuasion in the first trial than in the second; or (5) are matters of public policy and individual circumstances involved that would render the application of issue preclusion to be fundamentally unfair? Under the doctrine of issue preclusion, the prior judgment precludes re-litigation of issues actually litigated and determined by the prior suit, regardless of whether it was based on the same cause of action as the second suit. Taylor v. St. Michael Hosp. (LIRC, 05/31/01).

The Equal Rights Division provides the exclusive remedy to enforce the anti-discrimination provisions of the WFEA. Therefore, a WFEA claim could not be brought in a federal court action. Thus, federal judgments do not have claim preclusive effect on claims under the Wisconsin Fair Employment Act. Taylor v. St. Michael Hosp. (LIRC, 05/31/01).

The doctrine of judicial estoppel did not preclude the Complainant from denying that he was unable to perform the job of printer/press operator for the Respondent, which was an essential element of his age discrimination claim. The Complainant’s claim before the Social Security Administration (an agency which determines an individual’s qualifications for benefits based upon the extent of the individual’s inability to work) that he was unable to work was denied. Even a determination of disability by the Social Security Administration cannot be construed as a judgment that an employee is unable to do his job. Harrison v. LIRC (Sheboygan Co. Cir. Ct., 03/20/96).

Judicial estoppel is an equitable determination and should be used only when the positions taken are clearly inconsistent. The doctrine of judicial estoppel has certain identifiable boundaries. First, the later position asserted by a party must be clearly inconsistent with the earlier position asserted by that party. Second, the facts at issue should be the same in both cases. Finally, the party to be estopped must have convinced the first court to adopt its position -- a litigant is not forever bound to a losing argument. In this case, the doctrine of judicial estoppel should not be applied. The Complainant had stated in his application for SSI benefits that he was disabled from performing any work. He also testified at a hearing that he doubted whether he was physically able to do certain work. Later, in a complaint filed with the Equal Rights Division, the Complainant testified that he was capable of performing his job. These statements are not necessarily inconsistent, because they do not address the question of whether the Complainant would have been able to perform his job had there been an accommodation of his disability. Harrison v. LIRC, 187 Wis. 2d 490, 523 N.W.2d 138 (Ct. App. 1994).

An un-reviewed finding of no probable cause by the Personnel Commission barred an employee from bringing a claim for discrimination under sec. 42 U.S.C. 1983 in state court. The hearing before the Personnel Commission provided the employee with a full and fair opportunity to litigate her complaint. She was, therefore, barred by the doctrine of issue preclusion from bringing the same allegations in state court. Lindas v. Cady, 183 Wis. 2d 547, 515 N.W.2d 458 (Ct. App. 1994).

The doctrine of res judicata should not be applied where the Complainant, a security guard employed by a private security agency, was not a party or privy of a party to the lawsuit between the Respondent and the private security agency for which he worked. Jackson v. City of Milwaukee (LIRC, 10/28/93).

A complaint was properly dismissed on res judicata grounds where a federal court dismissed the Complainant’s federal retaliation claim on its merits. The Complainant chose not to bring a Wisconsin Fair Employment Act retaliation claim as a pendant state claim in the federal action although all of his claims arose out of the same set of facts. In this case, there is substantial doubt as to whether a federal court in Wisconsin would have dismissed a pendant WFEA claim in May of 1984. When the federal claim was filed, federal courts were divided as to whether they would entertain or dismiss private rights of action under the WFEA. In cases of doubt, the plaintiff should bring forward his state theories in the federal action in order to make it possible to resolve the entire controversy in a single lawsuit. Bourque v. LIRC (Marathon Co. Cir. Ct., 09/08/93).

Equitable estoppel consists of action or non-action on the part of one party that induces reliance thereon by another to the latter's detriment. Even when one of the doctrines of res judicata and election of remedies are inapplicable, under proper circumstances equitable estoppel may be used to bar a second cause of action on a different theory. In the case where a Complainant alleged in a worker's compensation action that his injury was work-related and that case was settled, the Complainant should not then be allowed to pursue another claim against the same employer on the theory that the injury was not work-related. Marson v. LIRC, 178 Wis. 2d 118, 503 N.W.2d 582 (Ct. App. 1993).

Some or all of the following factors may be considered in determining whether the doctrine of collateral estoppel should be invoked: (1) could the party against whom preclusion is sought, as a matter of law, have obtained review of the judgment; (2) is the question one of law that involves two distinct claims or intervening contextual shifts in the law; (3) do significant differences in the quality or extensiveness of the proceedings between the two courts warrant re-litigation of the issue; (4) have the burdens of per-suasion shifted such that the party seeking preclusion had a lower burden of persuasion in the first trial than in the second; or (5) are matters of public policy and individual circumstances involved that would render the application of the doctrine to be fundamentally unfair? Moore v. LIRC, 175 Wis. 2d 561, 499 N.W.2d 289 (Ct. App. 1993).

Judicial estoppel arises from sworn statements made in the course of judicial proceedings, generally in a former litigation, and are based on the public policy upholding the sanctity of an oath and not on prejudice to the adverse party by reason thereof, as in the case of equitable estoppel. There are two limitations on the doctrine of judicial estoppel. One is that the estoppel may be applied only where a clearly inconsistent position is taken. The second limitation is the requirement that the party to be estopped has convinced the court to accept its position in the earlier litigation. A party is not bound to a position it unsuccessfully maintained. Gilbertson v. Sajec Co. (LIRC, 02/19/93).

The Wisconsin Personnel Commission declined to give collateral estoppel effect to a circuit court decision where the findings by the court were tentative and subject to possible change or addition. Further, because the court retained jurisdiction over part of the case, there apparently was no appealable order. Finally, the Commission could not conclude that the findings by the court were findings which were essential to the decision reached by the court. Balele v. UW-Madison (Wis. Personnel Comm’n, 06/11/92).

For purposes of res judicata, a basic factual situation generally gives rise to only one cause of action, no matter how many different theories of relief may apply. Res judicata will not be defeated regardless of the number of primary rights that have been invaded and regardless of the variations in the evidence needed to support the theories or rights. Further, federal case law refutes the theory that, for purposes of res judicata, causes of action are not the same if one cause requires proof of an element that another cause does not. Local 322, Allied Indus. Workers of America v. Johnson Controls (LIRC, 03/30/92).

It is implicit in the principle of res judicata that a contention that the first tribunal erred in some respect is irrelevant. The point of res judicata is to preclude re-litigation and redetermination of issues. Whether the first tribunal's decision was correct is not something which enters into the determination of whether the decision should be given res judicata effect. Moore v. American Family Mutual Ins. Co. (LIRC, 11/22/91).

Collateral estoppel will only be applied against a party who was also a party in the previous case. The party must have had a full and fair opportunity to present its claim in the first proceeding, and facts to be given collateral estoppel effect must have been fully litigated in the first proceeding. The decision in the first proceeding must have made a valid and final determination as to those facts. The determination of the facts must have been essential to the decision in that case, and the burden of proof must be the same in the first proceeding as in the second proceeding. Guel v. Cooper Power Sys. (LIRC, 11/15/91), aff’d, (Ct. App., Dist. II, summary decision, 12/09/92).

The Personnel Commission follows the basic principles of res judicata which were set forth in Schaeffer v. State Personnel Comm’n, 150 Wis. 2d 132, 138-139, 441 N.W.2d 292 (Ct. App. 1989). A complaint will be dismissed if there was a final judgment in the federal court proceedings if the same parties are involved in both proceedings and if there is identity of claims. The Complainant cannot challenge the validity of what the federal court did. Oreido v. Wis. DER (Wis. Pers. Comm’n, 10/05/91).

The fact that the Complainant appealed the final judgment dismissing her claim in a federal court action does not prevent the application of the doctrine of res judicata. The pendency of an appeal does not deprive a judgment of its effect as a bar to another action between the same parties on the same cause of action. Byrne v. West Allis-West Milwaukee Sch. Dist. (LIRC, 09/18/91).