888 F.3d 356
8th Cir.2018Background
- In 1998 Minnesota (via the Attorney General) entered a court‑approved settlement with tobacco companies that released consumer‑protection claims and provided substantial periodic payments to the State.
- In 2001 and subsequent state litigation (Curtis), Minnesota courts held the Attorney General could settle those claims and that the 1998 release barred class members’ consumer‑protection claims.
- In 2014 Harne and Foster sued the State in Minnesota state court alleging inverse condemnation (Minn. Constitution Art. I § 13) and federal takings (Fifth Amendment) for failing to share settlement proceeds; the state trial court and court of appeals dismissed both claims as time‑barred under Minn. Stat. § 541.05.
- Foster later filed a federal class action under 42 U.S.C. § 1983 asserting the same Fifth Amendment taking claim.
- The district court dismissed Foster’s federal claim as barred by res judicata (and alternatively as time‑barred); the Eighth Circuit reviews de novo and affirms the dismissal on res judicata grounds.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Foster’s federal Fifth Amendment takings claim is barred by res judicata based on the prior Harne state‑court judgment | Foster: her federal claim arose later (after state remedies were exhausted) so it is not the same cause of action and thus not precluded | State: the federal claim is identical to the claim litigated and rejected in Harne, so preclusion applies | Held: preclusion applies; the federal takings claim is barred by res judicata |
| Whether Foster lacked a full and fair opportunity to litigate the federal claim in state court | Foster: state courts applied an inapplicable statute of limitations, denying full and fair litigation | State: Foster had the opportunity to litigate and appeal; dismissal on statute‑of‑limitations grounds is a merits disposition | Held: Foster had a full and fair opportunity; dismissal as time‑barred is a final judgment on the merits |
| Whether Williamson County prevents preclusion of a federal takings claim until a state compensation procedure is exhausted | Foster: under Williamson County federal claim does not accrue until state compensation remedies are exhausted | State: the alleged taking occurred when the Settlement Agreement was executed in 1998; state courts could and did adjudicate both state and federal takings claims | Held: Williamson County does not preclude state courts from deciding the federal takings claim; preclusion applies after state adjudication |
| Whether applying res judicata here would work an injustice by stripping federal courts of Takings Clause jurisdiction | Foster: preclusion would improperly bar federal forum for federal constitutional claims | State: litigating federal takings in state court is common and does not produce injustice where claim was actually litigated | Held: no injustice; preclusion is appropriate where the federal claim was fully litigated in state court |
Key Cases Cited
- Curtis v. Altria Grp., Inc., 813 N.W.2d 891 (Minn. 2012) (state court construed scope of 1998 tobacco settlement release)
- San Remo Hotel, L.P. v. City of San Francisco, 545 U.S. 323 (2005) (state adjudication of federal takings claim precludes relitigation in federal court)
- Williamson County Regional Planning Comm’n v. Hamilton Bank, 473 U.S. 172 (1985) (exhaustion rule for state compensation procedures before federal takings suit)
- Semtek Int’l Inc. v. Lockheed Martin Corp., 531 U.S. 497 (2001) (final state‑court judgment may be a merits disposition for claim‑preclusion purposes)
- Edwards v. City of Jonesboro, 645 F.3d 1014 (8th Cir. 2011) (Full Faith and Credit requires federal courts apply state preclusion rules)