Jack Aronowitz v. Home Diagnostics, Inc., and Technical Chemicals & Products, Inc.
174 So. 3d 1062
| Fla. Dist. Ct. App. | 2015Background
- Aronowitz owns three patents ('192, '580, '979) and licensed manufacturing and exclusive marketing rights to HDI and Technical Chemicals under 1988 and 1990 agreements that required HDI to pay royalties.
- Aronowitz sued in federal court (patent infringement and pendent breach-of-contract/royalty claims); district court initially found no infringement of the '192 patent and insufficient proof of a material breach to terminate the license.
- The Federal Circuit vacated several district-court findings, directed further proceedings on whether HDI used the '580 patent and whether royalties/breach occurred, and remanded for additional factfinding.
- While the federal case was pending/appealed, Aronowitz filed a state breach-of-contract action that was abated; later, after long administrative closure of the federal case, the district court denied reopening and entered final judgment based on abandonment/delay (not on the merits of the breach claims).
- Broward Circuit Court later reactivated the state action; HDI moved for summary judgment asserting res judicata and collateral estoppel based on the federal proceedings. The trial court granted summary judgment for HDI.
- The Fourth District reversed, holding the federal judgment was not a final merits adjudication of the breach issues (they were vacated or not decided), so claim and issue preclusion did not bar the state breach claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether res judicata bars the state breach-of-contract claim | Aronowitz: no final judgment on merits of breach claims in federal court, so no claim preclusion | HDI: federal case litigated breach/royalty issues; final judgment bars relitigation | Reversed: federal judgment was not a final merits adjudication on breach, so res judicata does not apply |
| Whether collateral estoppel precludes breach issues | Aronowitz: breach issues were not actually decided in federal court | HDI: issues were litigated and thus precluded | Reversed: breach issues were not actually decided/necessary to final federal judgment, so collateral estoppel does not apply |
| Whether federal court had jurisdiction over state breach claims | Aronowitz: pendent/state claims were not finally resolved | HDI: federal court had pendent jurisdiction and litigated the claims | Court: federal court had jurisdiction and did litigate some breach issues, but did not reach final merits on remaining breach issues |
| Effect of appellate vacatur/administrative closure on preclusion | Aronowitz: vacatur and dismissal for delay defeat preclusion | HDI: parties litigated breach by consent; should preclude relitigation | Court: vacatur of district findings and dismissal on non-merits grounds prevent use of that judgment to preclude state action |
Key Cases Cited
- Jaffer v. Chase Home Fin., LLC, 155 So. 3d 1199 (Fla. 4th DCA 2015) (summary-judgment standard)
- Branch Banking & Trust Co. v. ARK Dev./Oceanview, LLC, 150 So. 3d 817 (Fla. 4th DCA 2014) (movant’s burden on summary judgment)
- Anderson v. Vanguard Car Rental USA Inc., 60 So. 3d 570 (Fla. 4th DCA 2011) (federal preclusion principles applied in Florida)
- Technical Chems. & Prods., Inc. v. Home Diagnostics, Inc., 152 F.3d 947 (Fed. Cir. 1998) (vacating district findings and directing further inquiry on '580 usage and royalties)
- Tyson v. Viacom, Inc., 890 So. 2d 1205 (Fla. 4th DCA 2005) (identity-of-cause-of-action test for res judicata)
- Ciffo v. Pub. Storage Mgmt., Inc., 622 So. 2d 1053 (Fla. 4th DCA 1993) (reversed judgments cannot support res judicata)
- State St. Bank & Trust Co. v. Badra, 765 So. 2d 251 (Fla. 4th DCA 2000) (non-merits judgments cannot be used for res judicata)