FCA US, LLC v. Spitzer Autoworld Akron, LLC

RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit I.O.P. 32.1(b)
File Name: 18a0066p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
FCA US, LLC, fka Chrysler Group, LLC ┐
Plaintiff-Appellee, │
│
│
FRED MARTIN MOTOR COMPANY, > No. 17-1161
Intervenor Plaintiff-Appellee, │
│
│
v. │
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SPITZER AUTOWORLD AKRON, LLC │
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Defendant-Appellant.
│
┘
Appeal from the United States District Court
for the Eastern District of Michigan at Detroit.
No. 2:16-cv-11186—Sean F. Cox, District Judge.
Argued: November 30, 2017
Decided and Filed: April 4, 2018
Before: NORRIS, ROGERS, and BUSH, Circuit Judges.
_________________
COUNSEL
ARGUED: David M. Zack, BLEVINS SANBORN JEZDIMIR ZACK, PLC, Detroit,
Michigan, for Appellant. Jay F. McKirahan, MAC MURRAY & SHUSTER, LLP, New Albany,
Ohio, for Appellee Martin Motor Company. Hugh Q. Gottschalk, WHEELER TRIGG
O’DONNELL LLP, Denver, Colorado, for Appellee FCA. ON BRIEF: David M. Zack,
BLEVINS SANBORN JEZDIMIR ZACK, PLC, Detroit, Michigan, for Appellant. Jay F.
McKirahan, Patrick W. Skilliter, MAC MURRAY & SHUSTER, LLP, New Albany, Ohio, for
Appellee Martin Motor Company. John E. Berg, Cynthia M. Filipovich, CLARK HILL PLC,
Detroit, Michigan, for Appellee FCA.
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 2
_________________
OPINION
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ROGERS, Circuit Judge. In a previous case involving these same parties, we held that
certain provisions of Michigan and Nevada law were preempted by a federal statute, but we
upheld—as unchallenged on appeal—the district court’s decision in that case that similar
provisions of Ohio law were not so preempted. Spitzer Autoworld Akron, a party to the previous
case, as a party on the appeal in the previous case, explicitly declined to argue preemption of the
Ohio statute, but now asserts on appeal from a decision in a subsequent, independent proceeding
that the Ohio statute is preempted, based on our analysis of Michigan and Nevada law in the
previous case. While this procedural situation is somewhat unusual, it should come as no
surprise that Spitzer cannot now make the argument that it so clearly gave up in earlier litigation
with the same parties regarding the same facts. The district court accordingly was correct to rule
that principles of collateral estoppel foreclose Spitzer’s argument.
The previous case was a consolidated action involving automobile dealerships from
Michigan, Nevada, Ohio, Florida, California, and Wisconsin, whose franchise agreements were
rejected during Chrysler’s bankruptcy, but who had arbitrated successfully under Section 747 of
the Consolidated Appropriations Act of 2010, Pub. L. No. 111-1117, 123 Stat. 3034, 3219–22, to
be reinstated to Chrysler’s dealer network. In the consolidated action, the district court held that
Section 747 did not preempt the dealer protest laws of each of the six states, which grant existing
dealerships certain rights to protest the installation of competing dealerships in the same vicinity.
Four rejected dealers, three from Michigan and one from Nevada, appealed the district court’s
preemption decision; Spitzer Autoworld Akron LLC, a party to the consolidated action seeking
reinstatement to Chrysler’s Ohio dealer network, did not. In Chrysler Group LLC v. Fox Hills
Sales, Inc., we reversed the district court’s judgment in the consolidated action in part, and held
that Section 747 did not preempt the state dealer laws of Michigan and Nevada, but we explicitly
did “not consider the preemption argument with respect to Ohio state dealer protest laws.”
776 F.3d 411, 424 n.7, 430 (6th Cir. 2015) (Fox Hills).
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 3
Now Chrysler, Spitzer, and Fred Martin Motor Company are engaged in a protest
proceeding pending before the Ohio Motor Vehicles Dealer Board, and Chrysler filed the current
action to enjoin Spitzer from relitigating the preemption issue before the Ohio dealer board. The
court below held that collateral estoppel precludes Spitzer from raising the preemption issue, and
the court accordingly granted Chrysler’s request for injunctive relief barring Spitzer from
relitigating the issue before the dealer board. On appeal, Spitzer contends that collateral estoppel
is not applicable, and that the district court’s judgment violates Younger v. Harris, 401 U.S. 37
(1971), and its progeny. Because all the elements for collateral estoppel are met and no
exceptions apply here, the district court properly determined that Spitzer is barred from raising
the preemption issue before the state dealer board. Moreover, Younger abstention is not
applicable because the Ohio dealer protest proceeding is unlike any of the three types of cases to
which Younger applies.
I. The Consolidated Action
The background to these suits is set forth more fully in Fox Hills, see 776 F.3d at 414–21,
and only a shorter version is warranted here. In the throes of the financial crisis, Chrysler filed
for Chapter 11 bankruptcy in April 2009. See In re Chrysler LLC, 405 B.R. 84, 87–88 (Bankr.
S.D.N.Y. 2009). The bankruptcy restructuring plan transferred almost all the business from “Old
Chrysler” to “New Chrysler.”1 When Old Chrysler transferred its assets to the new entity, the
restructuring plan included procedures designed to consolidate and streamline Old Chrysler’s
business operations, including terminating sales and service agreements with 789 dealers.
The bankruptcy court overseeing the Chrysler restructuring authorized the dealership rejections.
See id. at 88; In re Old Carco LLC, 406 B.R. 180, 186–87 (Bankr. S.D.N.Y. 2009).
1
Previous courts have distinguished between “Old Chrysler” (aka Chrysler LLC), which existed before its
bankruptcy, and “New Chrysler” (aka Chrysler Group LLC), which was formed after Old Chrysler’s insolvency and
assumed nearly all the prior company’s ongoing business. In 2014, Chrysler Group LLC was renamed FCA US
LLC.
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 4
Passed to protect the interests of the rejected dealers, Section 747 of the Consolidated
Appropriations Act of 2010, Pub. L. No. 111-1117, 123 Stat. 3034, 3219-22, was intended to
“establish [] a disclosure and arbitration process to determine whether dealers that had their
franchise agreements terminated or not assumed by a successor company should be added to
dealer networks of automobile manufacturers partially owned by the Federal Government.”
H. R. Rep. No. 111-355, at 942 (2009), 2009 U.S.C.C.A.N. 11-5, 1251 (Conf. Rep.). Many
rejected dealers sought arbitration against New Chrysler under Section 747. Out of the over 400
rejected dealers who elected to arbitrate, Chrysler prevailed in 76 arbitrations, the dealers
prevailed in 32 arbitrations, and the remaining disputes were settled through other means.
Chrysler Grp. LLC v. S. Holland Dodge, Inc., 862 F. Supp. 2d 661, 670 n. 3 (E.D. Mich. 2012).
Disagreement about what the Section 747 arbitration orders entailed led to multiple
lawsuits, which the district court consolidated into one consolidated action. In the consolidated
action, Chrysler sought, among other things, a declaration that Section 747 did not preempt the
provisions of state dealer laws governing the establishment of additional like-line dealers.
Several existing like-line dealers, including Fred Martin, were also parties to the consolidated
action and similarly sought a declaration that Section 747 did not preempt the state dealer protest
laws of their respective states. Fred Martin also claimed that Section 747 was unconstitutional.
On the other hand, the rejected dealers who had successfully won the right to a Letter of Intent
through arbitration under Section 747, including Spitzer, sought a declaration that Section 747
did preempt the dealer protest laws of their respective states.
The parties cross-filed numerous motions for summary judgment, and the district court
ruled on all the parties’ dispositive motions. On the preemption issue, the district court held that:
Section 747 does not preempt the state-law dealer acts that govern the
relationships between automobile manufacturers and dealers in California (Cal.
Vehicle Code § 3060 et seq.), Florida (Fla. Stat. § 320.01 et seq.), Michigan
(Mich. Comp. Laws § 445.1561 et seq.), Nevada (Nev. Rev. Stat. § 482.36311 et
seq.), Ohio (Ohio Rev. Code. § 4517.43), or Wisconsin (Wis. Stat § 218.0101 et
seq.). . . . IT IS FURTHER ORDERED that New Chrysler’s motions for summary
judgment, seeking summary judgment as to its July 14, 2011 Complaint for
Declaratory Judgment against Spitzer, BGR and Boucher . . . are GRANTED.
S. Holland Dodge, 862 F. Supp. 2d at 684 (emphasis added).
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 5
Four rejected dealers in the consolidated action from Michigan and Nevada who had
successfully arbitrated under Section 747 appealed the district court’s no-preemption decision,
and Fred Martin cross-appealed, arguing that the district court erred by not considering Fred
Martin’s constitutional challenge to Section 747. Fox Hills, 776 F.3d at 422. Spitzer, however,
did not appeal the district court’s preemption ruling, but it did appear on appeal to defend
Section 747’s constitutionality and to claim that Fred Martin lacked standing to raise a
constitutional challenge to the Act. Id.
Spitzer’s arguments before the Sixth Circuit relied on the premise that the district court’s
no-preemption decision regarding Ohio’s dealer protest laws was valid, and at oral argument in
Fox Hills Spitzer acknowledged that its position on appeal with respect to preemption was
contrary to that of the other dealers. Spitzer argued that Fred Martin could not show the risk of
harm necessary for Article III standing because the only reason Fred Martin had filed a cross-
appeal was the “possibility that there would be preemption [of Ohio’s dealer protest laws][,]”
and “that possibility [was] gone with [the district court’s] decision” because Spitzer did not
appeal the preemption issue with respect to Ohio’s dealer laws. Moreover, Spitzer
acknowledged at oral argument in Fox Hills that it had chosen not to appeal the district court’s
preemption decision because it felt it had “such a strong position with respect to [the] [Letter of
Intent], that [it] just want[ed] to get on with it,” so it “just took the position, look, we’ll deal with
the protest laws of Ohio.”
In Fox Hills we reversed the district court’s preemption decision with respect to
Michigan’s and Nevada’s dealer laws and held that Section 747 preempts the operation of
Michigan and Nevada dealer protest laws. Fox Hills, 776 F.3d at 430. However, we explicitly
stated that we were not considering whether Section 747 preempts Ohio’s state dealer protest
laws:
Fox Hills, Village, Jim Marsh and Livonia all argue in favor of preemption.
Because these dealerships are located in Nevada and Michigan, we consider their
preemption arguments under the laws of those states. Spitzer, on the other hand,
does not challenge the state dealer protest laws in its home state of Ohio, a point
conceded by its attorney at oral argument. Accordingly, we do not consider the
preemption argument with respect to Ohio state dealer protest laws.
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 6
Id. at 424 n. 7. We then ordered that the judgment be reversed, and we remanded the case “so
that the district court may enter a declaratory judgment consistent with this opinion to the effect
that the state dealer protest laws in Michigan and Nevada are preempted.” Id. at 434.
II. The Current Action
Prior to the initiation of the consolidated action, Fred Martin had filed a protest
proceeding with the Ohio Motor Vehicles Dealer Board pursuant to Ohio’s dealer laws, Ohio
Rev. Code § 4517.01 et seq., to stop Chrysler from adding Spitzer as a dealer in Ohio. In the
protest proceeding, Spitzer argued that Section 747 preempted the dealer protest law under which
the proceeding was initiated, but the consolidated action commenced before the Ohio dealer
board could rule on the issue. The Ohio protest proceeding was placed on hold while the
consolidated action was underway, and Spitzer agreed that the consolidated action would decide
certain issues, one of which was whether Section 747 preempts Ohio’s dealer protest laws.
However, after the district court closed the consolidated action when it issued its final
judgment on remand after Fox Hills, counsel for Spitzer sent a letter to the Chief Administrator
of the Ohio Motor Vehicles Dealer Board advising him that Spitzer believed that our decision in
Fox Hills required that Spitzer’s protest proceeding involving Fred Martin and Chrysler be
dismissed. Fred Martin responded to Spitzer’s letter with a letter of its own, stating that “[t]he
Sixth Circuit never determined the issue of pre-emption related to Ohio laws,” and therefore “the
Michigan District Court’s ruling that state dealer laws are not pre-empted stands as to Ohio law.”
Fred Martin concluded that Spitzer was “barred by the doctrine of res judicata” from relitigating
the preemption issue before the state dealer board.
The Ohio protest proceeding remained at a standstill, and on April 1, 2016, Chrysler
initiated the current action by filing a complaint for declaratory judgment and injunctive relief,
seeking: a declaration that the laws of the Ohio Dealer Act remain in full force and effect with
respect to Spitzer and the Ohio protest proceeding; an injunction preventing Spitzer from
challenging or relitigating the district court’s judgment that Section 747 does not preempt the
Ohio Dealer Act; and any and all further relief that the Court deemed just and reasonable. Fred
Martin was permitted to intervene.
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 7
All three parties agreed that the case would be resolved by motions. Chrysler filed a
Motion for Judgment on the Pleadings, Spitzer filed a Motion to Dismiss/Motion for Summary
Judgment, and Fred Martin filed its own Motion for Summary Judgment. The motions were
fully briefed, and all three motions were heard by the court on February 2, 2017. Prior to the
February hearing, the district court by order provided specific questions that it intended to ask at
the hearing, including whether res judicata—an issue not raised in any of the parties’ motions—
applied. The court allowed the parties to file supplemental briefs on res judicata, and both
Chrysler and Spitzer filed supplemental briefs.
In a single order, the district court ruled on the parties’ dispositive motions. First, the
court rejected Spitzer’s threshold challenges to personal jurisdiction, venue, and standing.2 Next,
the district court determined that Chrysler was entitled to declaratory relief, concluding that issue
preclusion applies here, such that the issue of whether Section 747 preempts the Ohio Dealer Act
is “forever settled” as to Chrysler, Spitzer, and Fred Martin. The district court also held that
Federated Dep’t Stores, Inc. v. Moitie, 452 U.S. 394 (1981), foreclosed Spitzer’s fairness and
equity arguments against applying collateral estoppel here. Finally, the district court issued an
order enjoining Spitzer from challenging or relitigating whether Ohio’s dealer protest laws are
preempted by Section 747 before the Ohio dealer board.
III. Collateral Estoppel
Notwithstanding Spitzer’s arguments on appeal, Spitzer is collaterally estopped from
relitigating whether Section 747 preempts the dealer protest laws of Ohio. All four requirements
for collateral estoppel articulated in Cobbins v. Tenn. Dep’t of Transp., 566 F.3d 582, 589–90
(6th Cir. 2009), are met in this case. First, the precise issue of whether Section 747 preempts the
Ohio Dealer Act was raised and litigated during the consolidated action. Second, the district
2
The district court also rejected Chrysler’s and Fred Martin’s arguments for declaratory relief founded on
judicial admission, waiver, and law-of-the-case. The district court reasoned that Spitzer’s statements at oral
argument in Fox Hills did not qualify as a judicial admission because “judicial admissions generally arise only from
deliberate voluntarily waivers that expressly concede an alleged fact,” but Chrysler asked the court to hold that
Spitzer “made a ‘judicial admission that the Ohio state dealer law remains in effect as to Fred Martin’s protest’—
which is a legal conclusion” and “legal conclusions are rarely considered to be binding judicial admissions.” FCA
US, LLC v. Spitzer Autoworld Akron, LLC, No. 16-11186, 2017 WL 512790, at * 11 (E.D. Mich. Feb 8, 2010)
(citation and internal quotation marks omitted). The district court also held that the theories of waiver and law-of-
the-case were not applicable because the current action is independent from the earlier consolidated action.
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 8
court’s preemption decision in the consolidated action with respect to Ohio’s dealer laws was
necessary to the outcome in that case. Third, the district court in the consolidated action issued a
final judgment on Spitzer’s claims as part of its Opinion & Order on March 27, 2012, and on
June 26, 2015, it closed the consolidated action entirely when it issued its judgment on remand
after Fox Hills. Finally, Spitzer had a full and fair opportunity to litigate the preemption issue
before the district court in the consolidated action, and like other similarly situated parties, to
appeal the district court’s preemption decision.
Spitzer counters that Fox Hills represents a significant change in the legal climate with
respect to Section 747’s preemption of state dealer protest laws, and therefore issue preclusion is
not applicable here. Montana v. United States recognized that in some circumstances a
significant change in the legal climate can warrant an exception to issue preclusion. See
440 U.S. 147, 161 (1979) (citing C.I.R. v. Sunnen, 333 U.S. 591, 599, 606 (1948)). But Fox
Hills explicitly refrained from deciding whether Section 747 preempts the Ohio Dealer Act,
leaving the district court’s judgment on the issue in the consolidated action intact. See 776 F.3d
at 424, n. 7. We have recognized that “should there be a significant change in precedent, cases
decided under prior precedent that has been reversed will not have preclusive effects,” Int’l
Union, United Auto., Aerospace & Agric. Implement Workers of Am. (UAW) v. Kelsey-Hayes
Co., 854 F.3d 862, 872 (6th Cir. 2017) rev’d on other grounds, __ S. Ct. __, 2018 WL 1037569
(U.S., Feb. 26, 2018) (citing Sunnen, 333 U.S. at 599–600). But Fox Hills did not reverse the
district court’s holding that Section 747 does not preempt the Ohio state dealer laws. In fact, Fox
Hills “d[id] not consider the preemption argument with respect to Ohio state dealer protest laws”
because Spitzer did not appeal the issue, 776 F.3d at 424, n.7, and “[i]f an appeal is taken from
only part of the judgment, the remaining part is res judicata.” Laborers’ Int’l Union of N. Am.,
AFL-CIO v. Foster Wheeler Energy Corp., 26 F.3d 375, 396 n. 24 (3d Cir. 1994) (citing
1B James Wm. Moore et al., Moore’s Federal Practice ¶ 0.404[4.–3], at II–17 (2d ed. 1993)).
In Fox Hills we explicitly limited our analysis and holding to the dealer protest laws of
Michigan and Nevada. 776 F.3d at 423–30. We observed that the parties appealing the district
court’s preemption decision (Fox Hills, Jim Marsh, and Livonia) “are located in Nevada and
Michigan, [so] we consider[ed] their preemption arguments under the laws of those states.” Id.
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 9
at 424, n.7. Our analysis accordingly focused on the Michigan and Nevada statutes, id. at 424–
26, and our holding and disposition were similarly limited, id. at 434.
Moreover, the change-in-law exception to collateral estoppel generally applies where the
“change in law” is being applied to new facts, even though those new facts are indistinguishable
from the earlier action. Thus, in CIR v. Sunnen, the Supreme Court dealt with collateral estoppel
in the context of taxes for succeeding tax years. See 333 U.S. at 593.
[W]here two cases involve income taxes in different taxable years, collateral
estoppel must be used with its limitations carefully in mind so as to avoid
injustice. It must be confined to situations where the matter raised in the second
suit is identical in all respects with that decided in the first proceeding and where
the controlling facts and applicable legal rules remain unchanged.
Id. at 599–600. But this case and the consolidated action deal with the same facts, not merely
recurring indistinguishable facts. The effect of enforcing collateral estoppel in the instant case
should accordingly be the same as if Spitzer had tried to get the same relief in the consolidated
action itself. This Spitzer could not have done. For instance, Spitzer could not have reopened
the issue on remand after Fox Hills because, under the doctrine of law-of-the-case, a party that
fails to appeal an issue “waive[s] his right to raise the[] issue[] before the district court on
remand or before [the Sixth Circuit] on appeal after remand.” United States v. Adesida, 129 F.
3d 846, 850 (6th Cir. 1997). Indeed, “[t]he law-of-the-case doctrine bars challenges to a decision
made at a previous stage of litigation which could have been challenged in a prior appeal[] but
were not.” Id. This is true even when co-parties successfully appeal on related issues because
“[i]t is the generally accepted rule in civil cases that where less than all of the several co-parties
appeal from an adverse judgment, a reversal as to the parties appealing does not necessitate or
justify a reversal as to the parties not appealing.” Nat’l Ass’n of Broadcasters v. FCC, 554 F.2d
1118, 1124 (D.C. Cir. 1976). In addition, if Spitzer had tried to seek relief under Fed. R. Civ.
P. 60(b) it would have been unsuccessful because “[a] Rule 60(b) motion is neither a substitute
for, nor a supplement to, an appeal,” and “[f]or this reason, arguments that were, or should have
been, presented on appeal are generally unreviewable on a Rule 60(b)(6) motion.” GenCorp,
Inc. v. Olin Corp., 477 F.3d 368, 373 (6th Cir. 2007) (emphasis added). Even “[i]ntervening
developments in the law by themselves rarely constitute the extraordinary circumstances
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 10
required for relief under Rule 60(b).” Agostini v. Felton, 521 U.S. 203, 239 (1997). Spitzer
cannot evade such limits on its ability to challenge the very state proceeding that would have
been at issue in the consolidated action and Fox Hills, merely because this lawsuit is a new one.
Spitzer argues that it would be inequitable to apply collateral estoppel against it. But it
was Spitzer that agreed to stay the Ohio protest proceeding to allow the consolidated action to
determine whether Section 747 preempted Ohio’s state dealer laws, and it was Spitzer that made
the free, calculated, and deliberate choice not to challenge, in an appeal to which it was a party,
the district court’s unfavorable preemption decision with respect to Ohio’s dealer protest laws.
At oral argument in this action, counsel for Spitzer conceded that had Spitzer attempted to re-
raise the preemption issue on remand in the consolidated action it would have been precluded
from doing so because of its failure to raise the issue on appeal. Thus, it is perfectly fair to
disallow Spitzer from relitigating whether Section 747 preempts Ohio’s dealer laws now before
the Ohio dealer board, when Spitzer acknowledges that in the very case in which it agreed to
have the preemption issue decided it strategically abandoned the argument.
Spitzer’s equitable arguments are further undercut by the Supreme Court’s decision in
Federated Dep’t Stores, Inc. v. Moitie. In Moitie, seven plaintiffs separately brought claims
against the owners of various department stores alleging price fixing in violation of Section 1 of
the Sherman Act, 15 U.S.C. § 1, and the actions were assigned to a single federal judge.
452 U.S. at 395–97. After the district court dismissed all of the actions in their entirety on the
ground that the plaintiffs had not alleged an “injury” to their “business or property” within the
meaning of Section 4 of the Clayton Act, 15 U.S.C. § 15, the plaintiffs followed two divergent
litigation strategies. Moitie at 396. Five of the plaintiffs appealed the district court’s decision.
Id. The other two plaintiffs (Moitie and Brown) instead refiled in state court and purported to
raise state-law claims, but the defendants successfully removed the claims to the federal district
court. Id. at 396–97. In ruling on the propriety of removal, the district court held that while
Moitie’s and Brown’s complaints were artfully couched in terms of state law, the new
complaints were in many respects identical to the prior federal complaints and raised essentially
federal law claims, and therefore, because the new action involved the same parties, the same
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 11
alleged offenses, and the same time period, Moitie’s and Brown’s claims were barred by res
judicata. Id. This time Moitie and Brown appealed. Id. at 397.
While Moitie and Brown’s appeal was pending, the Supreme Court decided Reiter v.
Sonotone Corp., 442 U.S. 330 (1979), which effectively rejected the original district court’s
reasoning regarding the Clayton Act, and the Ninth Circuit reversed and remanded the five cases
that had been decided and appealed in the original action for further proceedings in light of
Reiter. Moitie, 452 U.S. at 397. The Ninth Circuit then reversed in Moitie’s and Brown’s
separate appeal, holding that while a “strict application of the doctrine of res judicata would
preclude [its] review of the instant decision,” “non-appealing parties may benefit from a reversal
when their position is closely interwoven with that of appealing parties.” Id. at 397–98.
Therefore, the Ninth Circuit concluded, “‘[b]ecause the instant dismissal rested on a case that has
been effectively overruled,’ the doctrine of res judicata must give way to ‘public policy’ and
‘simple justice.’” Id. at 398 (alteration in original) (quoting Moitie v. Federated Dep’t Stores,
Inc., 611 F.2d 1267, 1269–70 (9th Cir. 1980)). The Supreme Court categorically rejected the
Ninth Circuit’s decision. See id. at 398–402.
The Supreme Court observed that there is “no general equitable doctrine . . . which
countenances an exception to the finality of a party’s failure to appeal merely because his rights
are ‘closely interwoven’ with those of another party.” Id. at 400. Moreover, Moitie rejected the
idea that it somehow violates “simple justice” to enforce res judicata against nonappealing
parties who seek to be the “windfall beneficiaries of an appellate reversal procured by other
independent parties, who have no interest in [the nonappealing parties’] case.” See id. at
400. This reasoning applies particularly when parties “ma[k]e a calculated choice to forgo their
appeals,” id. at 400–01, as Spitzer did here. As in Moitie, there is no injustice in applying
collateral estoppel against Spitzer, because “[t]he doctrine of res judicata serves vital public
interests beyond any individual judge’s ad hoc determination of the equities in a particular
case.” Id. at 401. “Public policy dictates that there be an end of litigation; that those who have
contested an issue shall be bound by the result of the contest, and that matters once tried shall be
considered forever settled as between parties.” Baldwin v. Traveling Men’s Ass’n, 283 U.S. 522,
525 (1931); see also Parklane Hosiery Co., Inc. v. Shore, 439 U.S. 322, 326 (1979). Spitzer
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 12
agreed to have the consolidated action decide whether Section 747 preempts Ohio’s dealer laws,
and Spitzer as a party on appeal voluntarily disclaimed the preemption contention after the
district court ruled against it. To allow Spitzer to relitigate preemption in the Ohio protest
proceeding that was stayed specifically to allow the consolidated action to answer that question
would undermine the principles of finality, consistency, fairness, and conservation of judicial
resources that are the foundation of collateral estoppel.
Spitzer claims that Moitie is distinguishable because it considered claim preclusion rather
than collateral estoppel, but both doctrines are founded on common underlying equitable
principles. It is “[a] fundamental precept of common-law adjudication, embodied in the related
doctrines of collateral estoppel and res judicata, [] that a ‘right, question or fact distinctly put in
issue and directly determined by a court of competent jurisdiction . . . cannot be disputed in a
subsequent suit between the same parties or their privies . . . .’” Montana, 440 U.S. at 153
(quoting Southern Pac. R. Co. v. United States, 168 U.S. 1, 48–49 (1897)). Indeed, “[c]ollateral
estoppel, like the related doctrine of res judicata, has the dual purpose of protecting litigants from
the burden of relitigating an identical issue with the same party . . . and of promoting judicial
economy by preventing needless litigation.” Parklane Hosiery, 439 U.S. at 326. Even assuming
for the sake of argument that the district court’s decision in the consolidated action with respect
to whether Section 747 preempts Ohio’s state dealer laws was incorrect, there would still be no
inequity in applying collateral estoppel against Spitzer because issue preclusion prevents the
relitigation of wrong decisions just as much as right ones. See B & B Hardware, Inc. v. Hargis
Indus., Inc., 135 S. Ct. 1293, 1308 (2015).
Spitzer’s argument that collateral estoppel is not applicable because the preemption issue
is a pure question of law also fails. While the Supreme Court has recognized an “exception to
the applicability of the principles of collateral estoppel for ‘unmixed questions of law,’” that
exception only applies to “‘successive actions involving unrelated subject matter.’” United
States v. Stauffer Chemical Co., 464 U.S. 165, 171 (1984) (emphasis added) (quoting Montana,
440 U.S. at 162). Thus, “[t]he Supreme Court has severely limited the ‘unmixed’ question of
law exception[,] . . . requir[ing] a determination that the ‘issue of law’ arises in a successive case
that is so unrelated to the prior case that relitigation of the issue is warranted.” United States v.
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 13
Sandoz Pharm. Corp., 894 F.2d 825, 827 (6th Cir. 1990) (internal quotation marks omitted). But
the subject matter at issue in the Ohio protest proceeding, as explained above, is the same as the
subject matter previously litigated in the consolidated action. In fact, Spitzer acknowledges that
the protest proceeding was stayed specifically because “[t]he primary purpose of the . . .
[consolidated action] was to obtain a clarification of the issues as to whether Section 747 of the
Act preempted state dealer protest laws.” As the Supreme Court reasoned, even with respect to
government litigation, while the purpose underlying the exception for “unmixed questions of
law” in successive actions on unrelated claims is far from clear, “whatever its purpose, we think
that there is no reason to apply it here to allow the government to litigate twice with the same
party an issue arising in both cases from virtually identical facts.” Stauffer, 464 U.S. at 172
(emphasis added).
Spitzer’s final argument for finding collateral estoppel inapplicable—that Fox Hills’
reversal with respect to Michigan’s and Nevada’s dealer laws had the effect of also vacating the
district court’s judgment with respect to Ohio’s dealer laws—is without merit, because a partial
reversal of a judgment generally does not vacate or void the entire judgment. As previously
discussed, Fox Hills explicitly did not consider Ohio’s dealer laws, and we carefully crafted our
disposition to only affect the district court’s preemption decision with respect to Michigan’s and
Nevada’s dealer laws. Moreover, it is well established that “[i]f an appeal is taken from only
part of the judgment, the remaining part is res judicata, and the vacation of the portion appealed
from and remand of the case for further proceedings does not revive the trial court jurisdiction of
the unappealed portion of the judgment.” Foster Wheeler Energy, 26 F.3d at 396 n. 24 (citation
omitted).
Spitzer, however, claims that Erebia v. Chrysler Plastic Prods. Corp. announced a
contrary rule when we held that “[w]here the prior judgment, or any part thereof, relied upon by
a subsequent court has been reversed, the defense of collateral estoppel evaporates.” 891 F.2d
1212, 1215 (6th Cir. 1989). But Spitzer misreads Erebia’s holding. Erebia did not say that a
partial reversal robbed the entire judgment of preclusive effect, only that the part of the prior
judgment that has been reversed cannot support collateral estoppel. Indeed, Erebia explained
that “[w]hen a judgment has been subjected to appellate review, the appellate court’s disposition
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 14
of the judgment generally provides the key to its continued force as res judicata and collateral
estoppel.” Id. Thus, Fox Hills’ disposition—“[W]e REVERSE and REMAND . . . so that the
district court may enter a declaratory judgment consistent with this opinion to the effect that the
state dealer protest laws in Michigan and Nevada are preempted,” 776 F.3d at 434 (emphasis
added)—meant that the portion of the district court’s judgment with respect to Michigan’s and
Nevada’s dealer laws had lost its preclusive effect, while the portion of the prior judgment with
respect to Ohio’s dealer laws remained intact.
IV. Younger Abstention
Finally, the district court’s injunction does not violate Younger v. Harris and its progeny,
because the Ohio administrative proceeding between Chrysler, Fred Martin, and Spitzer does not
fall within any of the “exceptional” circumstances that warrant Younger abstention in civil cases.
“Younger abstention derives from a desire to prevent federal courts from interfering with the
functions of state criminal prosecutions and to preserve equity and comity.” Doe v. Univ. of Ky.,
860 F.3d 365, 368 (6th Cir 2017). But while we have recognized that “Younger abstention can
apply to cases that are not criminal prosecutions[,] . . . such applications are narrow and exist
only in a few exceptional circumstances.” Id. at 369.
[F]irst, Younger permits abstention when there is an ongoing state criminal
prosecution. Next, Younger precludes federal involvement in certain civil
enforcement proceedings . . . that ‘are akin to criminal prosecutions.’ Finally,
Younger pertains to ‘civil proceedings involving certain orders that are uniquely
in furtherance of the state courts’ ability to perform their judicial functions,’ such
as contempt orders.
Id. (citing New Orleans Pub. Serv., Inc. v. Council of City of New Orleans, 491 U.S. 350, 368
(1989) and Sprint Commc’ns, Inc. v. Jacobs, 134 S. Ct. 584, 588 (2013)).
None of these exceptional circumstances is present here. First, the Ohio administrative
proceeding is clearly not a state prosecution. Next, the Ohio administrative proceeding is not a
civil enforcement proceeding, and, even if it was, it is certainly not “akin to a criminal
prosecution.” Finally, the Ohio administrative proceeding is not a state civil proceeding
involving an order that is uniquely in furtherance of a state’s ability to perform its judicial
function. The Ohio administrative proceeding has no relation to civil contempt orders, state rules
No. 17-1161 FCA US, LLC v. Spitzer Autoworld Akron, LLC Page 15
for posting bond pending appeal, or any other orders that are uniquely in furtherance of the
judicial function of the Ohio courts. See Sprint Commc’ns, Inc., 134 S. Ct. at 592 (citing Juidice
v. Vail, 430 U.S. 327, 336 n. 12, (1977); Pennzoil Co. v. Texaco Inc., 481 U.S. 1, 13 (1987)).
V.
The judgment of the district court is affirmed.