The Supreme Court made a very narrow ruling on the issue of “defense preclusion” in a trademark action in Lucky Brand Dungarees Inc. v. Marcel Fashions Group Inc., Docket No. 18-1086 (May 14, 2020). In that case, one of the parties asserted a theory that certain defenses that were raised in that case by the other party could not be asserted due to “defense preclusion.” The doctrine of “defense preclusion” appeared to be an obscure species of “res judicata” that could be found in various treatises and other secondary sources of law.
The concept of “res judicata” is a well-known concept in American law that can be used to prevent parties from re-litigating claims and issues that have already been decided in other cases, usually involving the same parties or related parties.
Res judicata usually takes one of two forms, issue preclusion or claim preclusion. Issue preclusion prevents parties from re-litigating one or more issues in different lawsuits. Claim preclusion prevents parties from re-litigating entire claims in different lawsuits. The Supreme Court had to determine whether there was a third type of res judicata in the Lucky Brand decision.
The particularities of the facts, law and history of this case are very convoluted. The bottom line is that the Supreme Court recognized that the original lawsuit that purportedly gave rise to the purported “defense preclusion” preclusive effect involved different trademarks and different conduct occurring at different times than the case that was before the Court. As a result, there was no defense preclusion in that case.
The Court also seemed to reject the idea that “defense preclusion” constituted a third type of res judicata. Instead, the Court indicated that future litigants should limit the applicability of that particular doctrine to issue preclusion or claim preclusion.