OPINION OF THE COURT
New Jersey’s entire controversy doctrine is an extremely robust claim preclusion device that requires adversaries to join all possible claims stemming from an event or series of events in one suit. Animated by the laudable goal of easing the burdens of excessive litigation, the doctrine was developed in the domestic context, precluding suits in New Jersey courts based on disputes that were previously the subject of litigation in New Jersey courts. It has attained interjurisdictional proportions, however, and has been used in New Jersey to preclude claims based on a failure to effect joinder in previous litigation in non-New Jersey courts, where such joinder was not required by those courts’ own rules. The repercussions of the doctrine have prompted adverse scholarly comment. See generally Symposium: Entire Controversy Doctrine, 28 Rutgers L.J. 1 (1996). 1
This case began with a helicopter crash, though the facts have little bearing on the issue before us. We must decide whether a federal court in New Jersey should, when exercising its diversity jurisdiction, apply the entire controversy doctrine to bar thе plaintiff from asserting claims against the defendants because they were not asserted in prior litigation involving the instant parties and others in federal courts in Pennsylvania, New York, and New Jersey. We conclude that we should not. Disagreeing with the District Court, which barred the plaintiffs claim, we hold that federal courts should apply the general rule that the preclusive effect of a judgment is determined by the preclusion law of the issuing court — in this case, a federal court. We will, therefore, reverse the District Court’s grant of summary judgment *136 to the defendants on the plaintiffs tort claims and remand for further proceedings. We will also uphold the District Court’s determination of the amount owed to defendant Agusta Aerospace Corporation (“AAC”) on its counterclaims, but we will vacate the judgment on the counterclaims pending disposition of Paramount’s tort claims.
I. Facts and Procedural History
On October 10, 1989, an Agusta 109A helicopter crashed in New Jersey, killing the pilot, co-pilot, and three passengers, who were top-echelon employees of the Trump Hotel and Casino enterprises. The helicopter was manufactured by Costruz-ioni Aeronautiche Giovanni Agusta (“CAGA”) and purchased by AAC. CAGA is a subsidiary of Agusta S.p.A. and a part of Gruppo Agusta. AAC is CAGA’s wholly-owned U.S. subsidiary. These are the “Agusta defendants.” AAC sold the helicopter to Clifton Park Association, which sold it to FSQ Air Charter Corporation (“FSQ”). Paramount Aviation, Inc. (“Paramount”) arranged for this sale to FSQ and contracted with FSQ to manage the aircraft and to supply one of the two pilots who operated it.
The first lawsuit arising from the crash was Kent v. Costruzioni Aeronautiche Giovanni Agusta, Gruppo Agusta, Agusta Aviation Corp., & Paramount Aviation, Inc. (“Kent”), filed in the United States District Court for the Eastern District of Pennsylvania, on March 30, 1990, by the widow and estate of co-pilot Robert Kent. The Agusta defendants filed answers asserting cross-claims against Paramount for contribution and indemnification, and Paramount’s answer included cross-claims against the Agusta defendants for contribution and indemnification, but no affirmative claims. This case settled on November 27, 1990, for $3,150,000, of which the Agusta defendants paid $2,900,000 and Paramount paid $250,000.
Second came
Trump Taj Mahal Assoc., Trump Castle Assoc., Trump Plaza Assoс., & Helicopter Air Services, Inc. v. Costruzioni Aeronautiche Giovanni Agusta, Agusta, Gruppo Agusta, Agusta Aviation Corp., & Paramount Aviation Corp. (“Trump
”), filed in 1990 in the Superior Court of New Jersey and immediately removed to federal court. Prior to serving answers, the defendants filed motions for summary judgment, and the district court dismissed all counts, ruling that the plaintiff-employers were not entitled to recover under any of the theories they had alleged.
See Trump Taj Mahal
Assoc.
v. Costruzioni Aeronautiche Giovanni Agusta, S.p.A,
Next came FSQ Air Charter Corp. v. Costruzioni Aeronautiche Giovanni Agusta, Agusta, Gruppo Agusta, & Agusta Aviation Corp. (“FSQ”), filed in 1991 in the United States District Court for the Eastern District of New York. AAC filed a third-party complaint against Paramount, and Paramount answered without raising affirmative defenses or counterclaims. The parties’ insurers defended the action, which was settled in June 1992 with an exchange of mutual releases that specifically excluded the claims in the case before us.
Fourth was Paramount Aviation Corp. v. Gruppo Agusta, Agusta Aviation Corp., Costruzioni Aeronautiche Giovanni Agusta, & Agusta S.p.A (“PAC I ”),filed in the United States District Court for the District of New Jersey in 1990. That complaint alleged seven counts of tortious behavior, including negligence, willful misconduct, and strict tort liability. Paramount claimed that the crash caused it adverse publicity, public hostility, loss of clients and goodwill, loss of income, and other damages. On August 16, 1990, the complaint was volun *137 tarily dismissed under Federal Rule of Civil Procedure 41, without prejudice, pri- or to answer. Kent was still pending at that point, and Trump was on appeal.
Finally, PAC II, the instant case, was filed in New Jersey Superior Court in 1991. Alleging the same damages as PAC 1, plaintiff Paramount stated two counts: (1) negligence, gross negligence, and willful and reckless misconduct; and (2) strict tort liability. Paramount claimed damages as a result of the Agusta defendants’ manufacturing and design, which allegedly caused the crash. The case was removed, and the Agusta defendants (except for “Gruppo Agusta,” which seems to be an umbrella name without independent corporate existence) filed answers in October 1992, while AAC also stated a counterclaim against Paramоunt for amounts allegedly owed for another Agusta helicopter and for payments for spare parts, service, and training. Although the complaint contained a certification about Trump and FSQ, as required by N.J. Rule 4:5-1, the Agusta defendants did not raise the entire controversy doctrine in their answers. The defendants first raised the entire controversy doctrine in February 1996 and filed a summary judgment motion on that ground in February 1997.
The District Court granted summary judgment against Paramount on its claim, reasoning that the claim was barred by the entire controversy doctrine. It then granted summary judgment for AAC on the counterclaim. Paramount appeals.
II. The Entire Controversy Doctrine
A. Introduction; The District Court’s Rationale
Under the entire controversy doctrine, a party cannot withhold part of a controversy for separate later litigation even when the withheld component is a separate and independently cognizable cause of action. The doctrine has three purposes: (1) complete and final disposition of cases through avoidance of piecemeal decisions; (2) fairness to parties to an action and to others with a material interest in it; and (3) efficiency and avoidance of waste and delay.
See DiTrolio v. Antiles,
The entire controversy doctrine is an affirmative defense, waived if not pleaded or otherwise timely raised.
See Brown v. Brown,
The District Court further determined that Paramount was not prejudiced by this decision. The court reasoned that, given the lengthy history of litigation over the crash, the application of the doctrine could not have been unforeseen. Moreover, the court concluded that the long delay between the filing of the complaint and the motion for summary judgment was not prejudicial because it was largely the result of Paramount’s failure to prosecute the action vigorously. 2 The court further found that the Kent litigation offered Para *138 mount an opportunity to bring its claim against the Agusta defendants; Paramount had brought cross-claims for contribution and indemnification in that case.
Paramount argued that the doctrine should not apply when all the previous actions, as well as the instant one, were federal, but the District Court reasoned that the doctrine had routinely been applied in federal court.
See, e.g., Petrocelli v. Daniel Woodhead Co.,
Paramount urges that the District Court abused its discretion in its application of the equitable considerations behind the entire controversy doctrine. The District Court, of course, has great discretion in matters of this sort. However, we need not reach the issue, because we find that the entire controversy doctrine is not the right preclusion doctrine for a federal court to apply when prior judgments were not entered by the courts of New Jersey.
B. Foreign Application of the Entire Controversy Doctrine
In order to decide whether to apply New Jersey law or federal law, we must follow the rules laid down in
Erie
and its progeny. We are required to weigh the significance and substantive character of the state preclusion rule, and the likelihood that application of the federal rule would produce forum-shopping by parties, against the importance of the federal interests underlying the federal rule.
See Byrd v. Blue Ridge Rural Elec. Co-op., Inc.,
1. The Parties’ Contentions
Paramount notes that none of the lawsuits filed in the aftermath of the accident was litigated in New Jersey state court (three were brought in federal court and two were removed). 3 It argues that the New Jersey Rules of Court containing the entire controversy doctrine are procedural and therefore should not be аpplied in federal court. Paramount also submits that New Jersey’s interest in preserving the resources of its courts is minimal, if not absent, here, where all of the prior cases were litigated outside of the New
*139
Jersey courts.
See Henkels & McCoy, Inc. v. Adochio,
Paramount further contends that, when a prior decision’s preclusive effect is examined, it is the prior jurisdiction’s preclusion law that should generally be applied. See Restatement (Second) of Judgments § 87 (1982). Paramount reasons that federal preclusion law should apply to determine the preclusive effects of federal diversity judgments. In the absence of a prior New Jersey judgment on the merits, Paramount maintains, we have no reason to apply New Jersey’s supercharged preclusion doctrine.
The defendants respond that the Full Faith and Credit Act, 28 U.S.C. § 1738 (1994), requires a federal court hearing a New Jersey tort claim to be bound by New Jersey substantive law, of which the entire controversy doctrine is a part.
See Rycoline Prods., Inc. v. C & W Unlimited.,
The defendants also point out that federal courts have occasionally applied the entire controversy doctrine to determine the effects of non-New Jersey judgments, but the parties in prior decisions have not contested the application of the doctrine.
4
Nor have we resolved the broader issue of whether federal or state res judicata law governs successive diversity actions.
See Venuto v. Witco Corp.,
2. Relevant Case Law
We find two New Jersey decisions particularly helpful in elucidating New Jersey’s view of the entire controversy doctrine. In
Watkins v. Resorts International Hotel & Casino, Inc.,
In
Mortgagelinq Corp. v. Commonwealth Land Title Ins. Co.,
Mortgagelinq stated decisively that the entire controversy doctrine is procеdural, and that it was formulated specifically to preserve the resources of New Jersey courts. 5 The Court held that the doctrine bars suits in New Jersey against parties who could have been joined in an earlier suit in another state or in federal court. The result was binding only in New Jersey, however; other jurisdictions could permit litigation against earlier-omitted defendants despite a New Jersey decision dismissing an action on entire controversy grounds. The decision thus attempted to cabin the effect of the doctrine outside of New Jersey courts:
We hold that when a party deliberately chooses to fragment litigation by suing certain parties in another jurisdiction and withholds claims against other parties, a New Jersey court need not later entertain the claims against the omitted parties if jurisdiction was available in the first forum. In doing so we do not export our entire controversy doctrine to other jurisdictions, but merely hold that our notions of procedural fairness do not permit the claims that could have been brought elsewhere to be brought in New Jersey. This ruling presupposes that when the procedural rules of foreign jurisdictions permit the omitted claims to be brought later, the foreign jurisdiction is free to entertain such claims. Just as we do not seek to export our procedural requirements of party joinder, we do not seek to export any preclusive effect to our rules of party joinder.
One of the underpinnings of the entire controversy doctrine, in addition to fairness to the parties, is fairness to the system of judicial administration. “Judicial economy and efficiency — the avoidance of waste and delay — remain constants in the application of the entire *141 controversy doctrine. Fragmented and multiple litigation takes its toll on not only the parties but the judicial institution and the public.” Each jurisdiction is free to assess the importance of such values....
If Pennsylvania courts do not have a comparable party-joinder rule, principles of comity suggest that New Jersey should not seek to export its entire controversy doctrine to regulate the conduct of attorneys in that jurisdiction. In other words, attorneys conducting litigation in Pennsylvania courts should not have to accommodate their practices to the demands of New Jersey courts. A corollary of that proposition, however, is that New Jersey courts need not necessarily grant relief when parties deliberately refrain from seeking relief in other jurisdictions when doing so would have been much fairer to all parties involved. There is a delicate balance between the interests of the two jurisdictions that must accommodate the interests of justice ....
Maintaining a cohesive federal system (and the Full Faith and Credit Clause melds the state courts into that system) does not require that the other parts of the federal system honor our entire controversy doctrine.
Mortgagelinq,
The Mortgagelinq court mentioned that “the federal courts are considered those of another sovereign,” id. at 541, and suggested that the application of the doctrine in a diversity action in New Jersey federal court might be governed by choice of law principles, indicating that the court did not necessarily expect federal courts in New Jersey to apply the doctrine exactly as the state courts would. See id. at 542. Thus, while Mortgagelinq continued to embrace an expansive view of the doctrine within New Jersey state courts, it heralded an awareness of the doctrine’s limits when interjurisdictional problems were involved. While New Jersey cannot, of course, control our understanding of the relevant federal law, we consider Wqtkins and Mortgagelinq useful explications of the justifications for the doctrine, and hence of New Jersey’s interests. We turn, therefore, to an assessment of the relevant state and federal interests.
3. Analysis of the Relevant State and Federal Interests
a. The Import of Rycoline
Rycoline
held that a federal court deciding a federal cause of action is bound by the entire controversy doctrine when determining the effect of a prior New Jersey state court judgment. The court characterized the doctrine as “an aspect of the substantive law of New Jersey, by virtue of the Full Faith and Credit Act.”
Ryco-line,
The defendants claim that the just-quoted phrase from
Rycoline
obligates us to apply the entire controversy doctrine as part of New Jersey substantive law under
Erie.
We believe that the question is slightly, more complex. The Full Faith and Credit Act provides that the judicial proceedings of a state court shall have the same full faith and credit within every court in the United States as they have by law or usage in the courts of the issuing state. Thus, federal courts must give the same preclusive effect to a state court judgment as another court of that state would, unless to do so would violate due process.
See Rycoline,
To the extent that
Rycoline
la-belled the entire controversy doctrine “substantive” for purposes of the Full Faith and Credit Act, we conclude that it meant only that New Jersey law governed the preclusive effects of an earlier New Jersey state court judgment. This is exactly what the Act requires.
See University of Tennessee v. Elliott,
Under Mortgagelinq, a dismissal on entire controversy grounds is not a dismissal on the merits; this rule helps to ensure that the doctrine will not have untoward extrаterritorial effects. 6 However, New Jersey law still determines the preclusive effects of a prior New Jersey state court judgment on the merits, as in Rycoline.
b. New Jersey’s Interests and the Risks of Forum-Shopping
New Jersey’s main justification for the doctrine, its interest in preserving its judicial resources, is minimized when none of the prior litigation took place in New Jersey state courts. See Rochelle Cooper Dreyfuss & Linda J. Silberman, Interju-nsdictional Implications of the Entire Controversy Doctrine, 28 Rutgers L.J. 123, 156 (1996). New Jersey state courts still apply the doctrine in such cases, which conserves some of New Jersey’s judicial resources by precluding subsequent litigation in New Jersey. By contrast, when both prior and subsequent litigation takes place outside the New Jersey state courts, it is hard to see any New Jersey resource interest whatsoever, except inasmuch as the size of the federal docket indirectly affects the state courts.
The risk of unfair surprise is also heightened where the initial litigation did not take place in New Jersey; it may be difficult for responsible lawyers to predict that litigation in New York or California will close the New Jersey federal courts to future claims.
See id.
at 169;
cf. Electro-Miniatures Corp. v. Wendon Co.,
Some commentators have argued that Mortgagelinq was wrongly decided and that the Full Faith and Credit Act does not give New Jersey the freedom to give other courts’ decisions greater preclusive effect than those courts would allow. See Stephen B. Burbank, Where’s the Beef? The Interjurisdictional Effects of New Jersey’s Entire Controversy Doctrine, 28 Rutgers L.J. 87 (1996). Professor Burbank argues that Mortgagelinq works against the compelling interest in national unity by requiring litigants in other states to consider the preclusive effects of their cases on future cases in New Jersey, regardless of the preclusion law of the state in which they file complaints. He concludes that, regardless of New Jersey state court practice, federal courts in New Jersey should apply standard preclusion law, rather than the entire controversy doctrine, to the judgments of non-New Jersey courts. See Burbank, supra, at 100-01; see also Dreyfuss & Silberman, supra, at 157-58.
Professor Burbank further argues that, when a federal court in New Jersey tries to resolve this conundrum, it should apply the Full Faith and Credit Act rather than Erie balancing. Judicial balancing would be unnecessary, because Congress has explicitly instructed courts how to treat the judgments of state courts. See Burbank, supra, at 103 n. 82. Thus, if the previous litigation involved in this case had taken place in a state court, we would, as a matter of course, give it the preclusive effect it would have ¡in that state’s courts.
Though we find this argument persuasive, it does not dispose of this case, because the Full Faith and Credit Act does not by its terms apply here. When the prior decision is a federal decision, the Act applies only by analogy. And in that case, it is important to look to Erie principles to decide which sovereign’s law to apply. The Full Faith and Credit Act has an important implication, however: If the Act instructs New Jersey federal courts how to determine the preclusive effect of state decisions, there is a compelling argument for treating federal cases similarly. There is no good reason to apply New Jersey entire controversy law to determine the preclusive effects of a federal diversity case from Pennsylvania when the preclusive effects of the same case would have been governed by the law of the issuing court if it had been litigated in Pennsylvania state court. To make different rules for the two types of cases would be absurd, and would only move the potential forum-shopping problem back one level further, to the initial non-New Jersey litigation.
We note another factor that diminishes the force of the Erie concerns that generally lead to application of state law. Our Erie jurisprudence counsels us to avoid situations in which parties who can invoke federal jurisdiction are treated differently from those who cannot. Because we are considering a preclusion doctrine, the question is whether parties who can invoke federal jurisdiction will be able to litigate claims that will be precluded for parties who cannot. The risk of inequitable preclusion is minimal, for the following reason: This situation arises only when there has been previous litigation outside the New Jersey state courts. However, the entire controversy doctrine would only bar *144 a subsequent New Jersey suit if the first forum would have had jurisdiction over the claims raised in that subsequent suit. It therefore follows that there was an alternate non-New Jersey forum for the relevant claims, although in some cases that forum would be another state court. The relevant point is that no plaintiff in this situation will find itself entirely unable to litigate its claims; even if it is not able to take advantage of federal jurisdiction, it will have another state in which to bring its claims. 7
Any resulting disparity is no more than the disparity creаted by the very existence of diversity jurisdiction, which allows some parties the option of going to federal court whereas others with identical causes of action cannot. 8 While a decision to apply federal preclusion law would be outcome-determinative in this case, therefore, it would not ex ante cut off or extend any substantive rights that a plaintiff would have in the absence of a New Jersey federal forum, and would be unlikely to encourage significant forum-shopping. 9
Our analysis can be summarized as follows: New Jersey has no significant interest in controlling the dockets of other court systems. Moreover, application of a federal rule in the rather unusual circumstances here would be unlikely to create unfairness by causing different results in federal court than in state court or to cause significant forum-shopping. The issues of outcome-determinativeness and a consequent incentive to forum-shop are not free from doubt, however. Therefore, it is important for us to determine whether there is a significаnt federal interest counseling application of the federal rule.
See Fauber v. KEM Transp. & Equip. Co.,
c. The Federal Interest
Federal courts have a significant interest in determining the preclusive effects of federal judgments.
See Kaplan,
One of the strongest policies a court can have is that of determining the scope of its own judgments.... It would be destructive of the basic principles of the Federal Rules of Civil Procedure to say that the effect of a judgment of a federal court was governed by the law of the state where the court sits simply because the source of federal jurisdiction is diversity.
Kern v. Hettinger,
Paramount persuasively argues that we should aрply the general federal rule that the preclusive effects of prior cases are determined by the law of the prior forum. Applying the federal rule would also give effect to the joinder rules of the Federal Rules of Civil Procedure, which define the claims that parties must join if they are not to be later barred.
Cf. Hanna v. Plumer,
d. Summary and Conclusion
We conclude that respecting courts’ power to determine the preclusive effects of their own rulings is a significant federal interest. In particular, the claim joinder provisions of the Federal Rules of Civil Procedure express a federal policy about what claims must be joined to avoid later preclusion. Applying New Jersey preclusion law to determine the preclusive effects of federal cases would frustrate the policy embodied in the Rules, and we decline to do so. Instead we will follow the federal rule that the law of the issuing court — here, federal law — determines the preclusive effects of a prior judgment. 10
In reaching this result, clearly foreshadowed by
Kaplan,
we follow the majority of circuits to confront the issue of the law to be applied in successive diversity cases.
See, e.g., J.Z.G. Resources, Inc. v. Shelby Ins. Co.,
Since we have decided that federal law, rather than the entire controversy doctrine, applies, the obvious question is: What is the federal law?
*146
However, the Agusta defendants havе not argued, either in the District Court or this court, that federal preclusion principles bar Paramount’s suit. We thus deem a possible res judicata argument waived.
See Security Servs., Inc. v. K Mart Corp.,
III. The Counterclaims
In its counterclaims, AAC alleged that it was entitled to payments for the lease of one helicopter and for goods and services provided for three other helicopters. It presented three counterclaims, but the third counterclaim in actuality duplicated the claims of the first two, and the District Court granted summary judgment on those two. In order to prevail on summary judgment, a party stating an affirmative claim must come forward with evidence entitling it to a directed verdict.
See International Shortstop, Inc. v. Rally’s, Inc.,
The first counterclaim was for $34,629 plus 1.5% interest per month for breach of a helicopter lease contract entered into on March 20, 1987, and expiring November 15, 1989. The second was for $28,159.98 plus 1.5% interest per month for breach of a contract for the sale and suрply of spare parts, services, and training related to three of Paramount’s helicopters. The third was for an account stated between AAC and Paramount for $62,788.98 for unpaid lease payments and goods, services, and training, plus 1.5% interest per month after September 1989. The contracts were governed by Pennsylvania law.
AAC proffered the relevant lease agreements and invoices, and an affidavit from *147 its Vice President of Finance and Administration, Vincent Genovese, detailing the amounts not paid and calculating the interest due thereunder. For its account stated claim, AAC submitted a November 14, 1991, letter from Genovese to A Bartone, Paramount’s president. The letter states:
This letter shall formalize our agreement in which you have agreed to make monthly payments of $3,000 commencing 1/1/1992 in order to satisfy the debts owed by Paramount to Agusta Aerospace. As of October 31, 1991, the outstanding balance was $88,829.02 which includes interest of $10,361.00. Interest will continue to accrue on the principal amount of the debt until it is paid in full.
Please indicate your agreement with these terms by signing below.
Bartone signed “Agreed” on November 14, 1991. Paramount states that, in addition to this letter, it entered into a “short-term lease agreement” with AAC on the same day. This agreement gave Paramount the right to lease a newer model 109 helicopter from AAC for an hourly rental fee, and Paramount agreed to attempt to sell this aircraft on commission. Paramount contends that this new lease agreement was part of a package deal that also included the agreement relating to past debts quoted above. However, Paramount does not challenge AAC’s basic underlying evidence regarding the existence and terms of the 1987 helicopter lease and the service contract.
Paramount defended against the account stated claim by noting that, although the November 14 Genovese/Bartone letter was signed two days after AAC filed counterclaims, the amount in the letter differs from that in the counterclaim, and the letter makes no mention of those counterclaims. Paramount also argued that AAC did not submit proof that it demanded payment before filing the counterclaims. The District Court found Paramount’s arguments persuasive to defeat the account stated claim, but ultimately irrelevant, because the relief sought on the account stated claim was exactly the same relief sought on the two breach of contract claims, on which it granted summary judgment to AAC. .We agree.
In fact, Paramount did not effectively challenge AAC’s entitlement to the amounts asserted in the counterclaims, except to offer a number of defenses: an argument that the November 14 letter constituted an accord and satisfaction or a novation; a claim that AAC had waived its counterclaims; and various equitable defenses. It also asserted a set-off. The District Court rejected these defenses. We take them up in turn, except for the equitable defenses, which we dispose of summarily in the margin. 12
A. Accord and Satisfaction or Novation
Paramount contends that there was an accord and satisfaction or a novation, based on the November 14 letter. An accord and satisfaction is a substitute contract for settlement of a debt by some alternative other than full payment.
See Occidental Chem. Corp. v. Environmental Liners, Inc.,
Paramount then argued that the letter was a novation, extinguishing the former obligation by another new promise. In a novation, the new promise itself satisfies the preexisting claims, whereas in an accord it is the performanсe of the new promise that does so.
See id.
A novation bars revival of the preexisting duty.
See Beechwood,
Paramount claims that a jury could find the letter to be a novation, especially when viewed in context with the lease agreement for the new model 109A helicopter executed the same day and given that the amount in the letter differed from that stated in the counterclaim. The existence of a substituted contract is generally for the jury.
See Proie Bros., Inc. v. Proie,
B. Waiver
Paramount also argues that AAC waived its claim by failing to send dunning notices or to take any steps to collect the debts that were due and owing until Paramount sued. Under Pennsylvania law, waiver of legal rights can arise by clear, unequivocal, and decisive action by a party with knowledge of such rights and evident purpose to surrender them. Waiver can be express or implied from conduct in situations that would support equitable estoppel. The party claiming implied waiver must show that it was misled and prejudiced by the other party’s conduct.
See Prousi v. Cruisers Div. of KCS Int'l Inc.,
*149 C. Disputes as to Amount
Paramount also makes several claims about the amount due. First, it argues that the award of 1.5% interest on the goods and services contract was inappropriate, because only the helicopter lease agreement provided for interest, and because many of the invoices for goods and services were issued after September 1989, while interest was calculated on the entire amount in controversy starting from September 1989. See App. at 640. However, as the District Court observed, Paramount never attempted to rebut AAC’s calculation, expressed in the affidavit of its Vice President, Mr. Genovese. We will not allow it to do so on appeal.
Second, Paramount contends that AAC sought compensation for goods and services with respect to a helicopter numbered 7341, which Paramount never owned or operated. However, Paramount never submitted evidence to the District Court to counter AAC’s affidavit. Although Paramount denied knowledge or information about thе helicopter in its responses to requests for admission, its general denial is insufficient to create a genuine issue of fact.
See United States v. Bottenfield,
Paramount finally argues that there was a difference between the amount claimed in the counterclaim ($62,788.98 without interest) and the amount stated in the November 14 letter ($78,468.02 without interest), despite the fact that the counterclaim was filed two days before the letter was sent, and that this creates a genuine issue of material fact. We disagree, concluding that the District Court was correct to award judgment on the breach of contract claim based on the Vice President’s affidavit about the amounts Paramount owed. This is true regardless of what the November 14 letter said, because if it was an accord it was never satisfied and thus Paramount was responsible for the initial obligation.
D. The Setoff
Paramount asserted a setoff based on the same facts that grounded its initial claim, i.e., Paramount alleged that the 1989 crash was caused by Agusta’s defective manufacturing and maintenance, and that the crash caused Paramount signifiсant harm. Paramount argued that the helicopter that was the subject of the counterclaim also had a vibration problem like the problem that caused the crash, although the District Court found the maintenance records difficult to decipher on that point. Thus, Paramount contends that it is entitled to recover from the Agusta defendants for the harm caused by the crash-related events, which offsets any amount it might owe AAC. The District Court rejected the setoff claim on entire controversy grounds. Because we have found the entire controversy doctrine inapplicable to Paramount’s claims, Paramount will be entitled to try to prove its case on remand and, if it prevails, it may offset any recovery against the amount owed on the counterclaims. In sum, we uphold the District Court’s determination of the amount due on the counterclaims. However, because the setoff may be a valid claim, we will vacate the judgment on the counterclaims pending resolution of Paramount’s claims on remand.
IV. Conclusion
For the foregoing reasons, wе will reverse the District Court’s grant of summary judgment to the Agusta defendants on Paramount’s tort claims and remand for further proceedings. We will affirm the District Court’s determination of the amount owed on AAC’s counterclaims, but vacate the judgment on the counterclaims pending disposition of Paramount’s tort claims.
Notes
. Until quite recently the entire controversy doctrine required party as well as claim join-der. The party joinder aspect of the doctrine, the focus of the lion’s share of the criticism, has now been eliminated. See N.J. R. Civ. Pro. 4:30A. However, the interjurisdictional claim preclusion problem, also the subject of considerable scholarly criticism, remains.
. The parties strenuously dispute the causes and effects of the delay, but, as we need not reach the issue, we will not address it in greater detail,
. Paramount submits, and the Agusta defendants do not challenge, that the fact that actions were originally commenced in state court is irrelevant. Once removed, jurisdiction in the District Court is original and federal procedure applies. Moreover, the state courts have expended negligible resources on the removed case; New Jersey courts do not apply the doctrine when a prior case was pending for only a few days and no notable activity took place.
Cf. Hulmes v. Honda Motor Co.,
. The entire controversy doctrine has indeed been invoked when the previous suit was in another state or in a federal court.
Melikian v. Corradetti,
.
'Guaranty Trust Co.
announced that "[i]t is ... immaterial whether statutes of limitation are characterized either as 'substantive' or 'procedural' in State court opinions in any use of those terms unrelated to the specific
[Erie]
issue before us.”
Guaranty Trust Co.,
. The characterization of an entire controversy-based dismissal as one not on the merits only matters when the prior decision to which New Jersey applies the doctrine is not handed down by a New Jersey state court. When the first decision issues from a New Jersey court, that case carries its own preclusive effect, deserving of full respect in the courts of other jurisdictions. If there is a second New Jersey case that is dismissed on entire controversy grounds, and then a third federal case, we might also give the second New Jersey case preclusive effect on the issue of the application of the entire controversy doctrine to the facts, see 18 Wright, Miller & Cooper, Federal Practice & Procedure § 4418, at 171 (1981) (discussing the preclusive effects of determinations that do not go to the merits), but we need not delve further into these murky preclusion waters to decide the case before us.
. It is possible, of course, that a party who has already participated in a foreign lawsuit will mistakenly file a second suit in New Jersey state court and will lose on entire controversy grounds after the statute of limitations for filing a claim elsewhere has run, although it is not entirely clear that a plaintiff in such a situatiоn would be subject to the doctrine.
See Erenberg v. Cordero,
294 NJ.Super. 352,
. The decision to apply federal preclusion law affects forum choice in this sense only: A well-informed plaintiff might be able to split claims between some foreign court and a New Jersey federal court that, if the federal court applied the entire controversy doctrine, it would otherwise consolidate in the foreign court. But this is not the forum-shopping between state and federal court that Erie decried; it is claim-splitting, which presents different issues. As long as the plaintiff adheres to the other jurisdictions’ rules of joinder, we do not think that any inequity has occurred. It is theoretically possible that variations between New Jersey choice-of-law doctrines and the choice-of-law doctrines of other jurisdictions might change the outcome on such a split claim, but we doubt that parties will base their forum choices on such exotic possibilities.
.Relatedly, the forum-shopping concern is diminished simply because successive litigation is less common than litigation in the first instance; there are many factors that go into a decision to file a second lawsuit, and we doubt that a decision to apply federal preclusion law will substantially alter the relevant incentives. In this case, Paramount was not even the initial plaintiff in the pre-PAC lawsuits; in a real sense, Paramount had very little choice over those fora, even though it filed counterclaims and cross-claims.
. We need not resolve here whether particular aspects of preclusion, such as privity, are "substantive” and are governed by state law.
Cf. Lubrizol Corp. v. Exxon Corp.,
. We doubt that such a claim would be meritorious in any event. The preclusion inquiry in this case is essentially identical to the question whether Paramount's tort claims were compulsory in any of the earlier lawsuits.
See Publicis Communication v. True North Communications Inc.,
The
Kent
suit raises a somewhat trickier issue, because Paramount and the Agusta defendants filed cross-claims for contribution and indemnification against one another in that case. Arguably, the filing of a cross-claim makes parties "opposing parties” within the meaning of Federal Rule of Civil Procedure 13.
See Schwab v. Erie Lackawanna R.R. Co.,
FSQ,
in which AAC filed a third-party complaint against Paramount, raises the specter of an omitted compulsory counterclaim that would preclude the present suit. However, we are inclined to think that the releases in
FSQ,
which specifically excluded the
PAC
claims, would operate as a waiver of a preclusion defense.
See Publicis,
. Paramount asserted a hodgepodge of equitable defenses, which the court held inapplicable to AAC's counterclaims. Estoppel, for example, requires material misrepresentation, reasоnable reliance, and resulting damage.
See Greenberg v. Tomlin,
. If there was a new contract, Paramount further argues, the statute of limitations has run on it, because the counterclaim was never amended to include the new contract. Because we conclude that there was no new contract, we need not resolve this issue.