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Marrese v. American Academy of Orthopaedic Surgeons

Supreme Court of the United States · 1985 · Civil Procedure

Civil ProcedurePreclusionFull Faith and CreditFederal Antitrust Jurisdictionclaim preclusionissue preclusionres judicata28 U.S.C. § 1738

Facts

Petitioners were board-certified orthopaedic surgeons whose applications for membership in the American Academy of Orthopaedic Surgeons were denied without a hearing or statement of reasons. Each petitioner sued in Illinois state court, alleging violations of associational rights protected by Illinois common law, but neither alleged a state antitrust violation or filed a contemporaneous federal antitrust action. After the state actions were dismissed, petitioners filed a federal antitrust suit under § 1 of the Sherman Act based on the same underlying events. Respondent argued that the earlier state judgments claim-precluded the federal suit.

Issue

When plaintiffs first litigate related state-law claims in state court and later bring a federal antitrust claim that could not have been raised in state court because federal courts have exclusive jurisdiction, must a federal court determine preclusion by first applying the rendering state's preclusion law under 28 U.S.C. § 1738? More specifically, could the court of appeals hold the federal antitrust claim barred without first examining Illinois preclusion law?

Rule

Section 1738 generally requires a federal court to give a state-court judgment the same preclusive effect it would have in the courts of the rendering State. Therefore, even when the later claim falls within the exclusive jurisdiction of the federal courts, the federal court must first consult state preclusion law; only if state law would preclude the claim or issue does the court then consider whether a federal statute creates an express or implied exception to § 1738.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In Illinois, Nora Patel sued Lakefront Trade Guild in Chicago state court for violating Illinois common-law associational rights after the guild expelled her. After the state case was dismissed with prejudice, she filed a federal suit in federal court in Chicago alleging the same expulsion was an unlawful restraint of trade under a federal statute that may be heard only in federal court.

How should the federal court analyze the guild's preclusion defense?

Explanation. The majority held that § 1738 generally requires a federal court to give a state-court judgment the same preclusive effect it would receive in the courts of the rendering State. The court must begin with state preclusion law even when the later claim falls within exclusive federal jurisdiction. Only if state law would bar the later claim or issue does the court reach whether Congress created an express or implied exception to § 1738.