This appeal involves an oil and gas royalty fund that the State of Utah (“Utah”) is required to administer for the benefit of members of the Navajo Nation living in San Juan County, Utah. In this class action, beneficiaries of the Navajo Trust Fund (the “Beneficiaries”) seek a fiduciary accounting of trust fund activities from Utah. In proceedings below, Utah unsuccessfully argued that all or a portion of the Beneficiaries’ claim was precluded by three prior cases to which the Beneficiaries were not parties. On appeal, Utah argues that Beneficiaries should be precluded because they were either “adequately” or “virtually” represented by parties in the three prior cases. After oral argument, the United States Supreme Court granted certiorari in
Taylor v. Sturgell,
— U.S. -,
I. JURISDICTION
The district court entered a partial summary judgment order on January 11, 2006. Utah filed a notice of interlocutory appeal from that order, asserting jurisdiction under 28 U.S.C. §§ 1291 and 1292(a), and Case No. 06-4046 was opened. Beneficiaries filed a motion to dismiss, challenging appellate jurisdiction over the uncertified *1274 interlocutory order. That issue was briefed and submitted to this merits panel.
In the meantime, Utah requested the district court to certify the January 11, 2006 order for interlocutory appeal. The district court granted the motion, and on April 27, 2006, amended its order to include the appropriate language for potential interlocutory appeal pursuant to 28 U.S.C. § 1292(b). 2 A petition seeking permission to appeal was then filed with this Court, Pelt v. Utah, Case No. 06-602, which was granted, and Case No. 06-4164 was opened on June 20, 2006. Utah filed a motion to consolidate the two appeals, but the clerk’s panel denied the motion and the appeals were briefed separately on the merits.
The jurisdictional issue remains pending in Case No. 06-4046. In opposing Beneficiaries’ motion to dismiss, Utah argued that the appeal in 06-4046 should be maintained because it provided a broader scope of review than the appeal in 06-4164. Specifically, Utah argued that this Court might be more inclined to exercise “supplemental” appellate jurisdiction over a prior 2001 district court order in 06-4064 because that appeal would not be dependent upon certification by the district court. Utah does not raise this supplemental jurisdiction argument in either appeal, however, and has acknowledged that the issues in these appeals are identical. 3
The status of the appeals herein is that there is pending a timely discretionary appeal by Utah under section 1292(b) and an appeal under section 1291 requesting non-discretionary appeal of the same interlocutory order under section 1292(a)(1). In short, these identical appeals are before us both as one of right and one of petition. Because we granted Utah’s petition for discretionary appeal under section 1292(b), we find it unnecessary to consider the simultaneous non-discretionary appeal under section 1292(a)(1) and dismiss Case No. 06-4046.
See PPG Indus., Inc. v. Continental Oil Co.,
II. PROCEDURAL AND FACTUAL BACKGROUND
In 1933, the federal government established the Navajo Trust Fund (“the Fund”), from which a percentage of royalties derived from exploitation of oil and gas deposits under the Navajo Reservation’s Aneth Extension would be paid to Utah. Such funds were to be spent for the health, education and general welfare of the Indians residing in the Aneth extension, the ancestral home of Navajo Indians and other Native Americans. Congress later amended the beneficiary class to include all Navajo Indians living in San Juan County, Utah.
See Pelt v. Utah,
The present action is the fourth lawsuit brought by Fund beneficiaries against Utah challenging its administration of the Fund. Before the instant case was filed, three other cases also sought equitable accountings of Fund receipts and expenditures for time periods now at issue. These prior lawsuits are discussed below.
*1275 Sakezzie v. Utah State Indian Affairs Commission
The Sakezzie action was filed in April 1961, on behalf of the named plaintiffs and “as representatives of and members of the class of persons who are Navajo Indians residing within the Aneth Extension of the Navajo Indian Reservation in San Juan County, Utah.” Although it was a class action, the Sakezzie case was not certified as such, nor was it subject to the current rules governing class actions under Federal Rule of Civil Procedure 23, as amended in 1966.
Plaintiffs requested an accounting of all Fund monies and alleged that no expenditures had been for their use and benefit. Plaintiffs did not seek monetary compensation in connection with the accounting. Utah provided answers to interrogatories containing a summary explanation of expenditures, with no supporting documentation. The case was tried to the court on June 12, 1961, at which time the district court issued an oral ruling where the judge stated:
[t]he matter of accounting has been rendered moot by pretrial discovery, I believe, and also by the evidence which indicates that the agencies of the Federal Government have been receiving and paying over to the State the funds in question, leaving the problem of accountability in the area of disbursements, rather than checking receipts.
The “pretrial discovery” refers to the interrogatory answers, but it is not clear what other “evidence” the district court was referring to. Nothing in the record indicates that Plaintiffs objected to the district court’s finding that the accounting claim was mooted by the interrogatory answers.
The district court entered written Findings of Fact and Conclusions of Law, which stated that the court found that the Utah defendants “have not kept the plaintiffs and those represented by them reasonably informed concerning the amounts received in said [F]und and as to expenditures from said [F]und; but in the course of this proceeding have fully informed the plaintiffs of such receipts and expenditures.”
Sakezzie v. Utah Indian Affairs Comm’n,
In July 1962, plaintiffs filed the first of two post-judgment petitions for relief, alleging that defendants were not complying with the district court’s judgment and decree. Plaintiffs alleged that defendants refused to provide them with information relating to either the receipts or disbursements of the Fund. Plaintiffs sought an order requiring monthly accountings of both receipts and expenditures. Defendants again filed answers to interrogatories setting forth what they characterized as accounting information in the form of an Indian Affairs Commission Annual Report that contained accounting information from July 1, 1961 through June 30, 1962. On February 7, 1963, the district court entered a Memorandum of Decision, stating that while defendants had kept “full and proper accounts” of the funds received by them, they demonstrated
*1276
Sakezzie v. Utah Indian Affairs Comm’n,
*1275 remarkable unconcern about keeping the beneficiaries of the fund informed of accretions to said fund, about disbursements and commitments therefrom and about plans with respect to future expenditures, have failed to do what was convenient and reasonably within their power to advise the beneficiaries concerning these and other matters and have often ignored without justification or excuse requests and inquiries by the Indians or their representative.
*1276 In May 1964, plaintiffs filed a second post-judgment petition seeking relief from defendants’ alleged failure to comply with the two previous orders. This third petition alleged, inter alia, continued refusal of Fund administrators to provide information regarding ongoing receipts and expenditures. The third petition did not seek an order requiring Defendants to produce yet another accounting, but instead requested compensation for funds that the court found to have been expended or invested for purposes inconsistent with its previous orders, and an order enjoining defendants from making any further use or expenditures of the funds. The record in Sakezzie reveals no further activity for more than a year, when the district court ordered Plaintiffs to show cause why the third petition should not be dismissed. Plaintiffs’ attorney did not attend the hearing and the district court dismissed the petition for failure to prosecute. Two days later, plaintiffs’ counsel filed a Motion for Reinstatement. The court denied the motion, but granted Plaintiffs leave to file an amended petition. Plaintiffs did not file another petition, and the Sakezzie case appears to have ended with the dismissal for failure to prosecute.
Jim v. State of Utah
The case of Jim v. Utah was filed on February 7, 1970. The named plaintiffs represented a class consisting of approximately 1500 Navajo and other Indians residing on the Aneth Extension of the Navajo Reservation. The primary focus of the action was to challenge the constitutionality of the 1968 Amendment to the 1933 Act, which expanded the beneficiary class to comprise all Navajos living in San Juan County, Utah, and eliminated non-Navajos living on the Aneth Extension. The complaint alleged that defendants
are using and disbursing the said 37 1/2 % of such royalties received by the State of Utah in breach of their fiduciary duty to plaintiffs by expanding the same for the benefit of persons or parties who have no beneficial interest or other right therein and not for the benefit of plaintiffs.
Plaintiffs requested an accounting of monies received and spent from such royalties up to May 17, 1968. There was no request for money damages.
When the case was certified as a class action under Fed.R.Civ.P. 23(b)(2), the district court determined that the case had sufficient notoriety that no further notice to members of the class was necessary. A bench trial was conducted approximately one year later, and the district court entered an Interlocutory Decree and Order on February 7, 1972, declaring the 1968 Amendment unconstitutional and ordering Utah to file the monthly reports as previously ordered in Sakezzie
II,
for the periods from February 25, 1963 to May 17, 1968, and from May 17, 1968 to the present. Utah appealed the order to the United States Supreme Court, which reversed the district court’s finding that the 1968 Amendment was unconstitutional.
United States v. Jim,
On remand, the district court held that an accounting had yet to be done, and ordered Utah to file “a complete, comprehensive, proper, lawful accounting showing, for two periods, to wit, up to May 17, 1968 and from May 17, 1968 to the present [February 1974].” On February 7, 1974, Utah filed an “accounting and abstract” *1277 consisting of minutes and financial statements of the Utah Board of Indian Affairs. The parties stipulated that this information was being filed in lieu of a formal accounting as ordered by the court, and would not affect the court’s right to require further reporting or accounting.
Approximately eighteen months later, at a hearing in July 1975, plaintiffs’ counsel told the court that there were two remaining items to be resolved — attorney fees and an accounting. Counsel further stated that “[a]n accounting and abstract was filed with the court, and the plaintiffs do not object to that,” and advised the court that the parties could not reach an agreement regarding fees and requested the matter set for hearing.
In May 1976, the district court held a hearing on plaintiffs’ motion for attorney fees. After noting that Plaintiffs had hired three of the law firms recommended by the court, each firm was awarded fees in the amount of $10,000. Plaintiffs’ counsel testified that, although the accounting demand was still pending, the court might still grant the motion for fees and dismiss Jim without prejudice:
Now there has never been an accounting. The case is still pending as far as that accounting is concerned. If the Court wants to dispose of it I suppose the Court can dismiss it without prejudice as far as that accounting is concerned and we think he [sic] should award attorneys’ fees to all of the attorneys involved.
The court responded,
I think we should pursue the accounting matter, of course. I think that is the most important part of the lawsuit, really. The legal points are settled now. Let’s have an accounting of what the state’s been doing with the Indians’ money. That’s the short question we need to go into and let’s pursue it.
Notwithstanding the district court’s directive, no further action was taken in the case until more than two years later, in December 1978, when the court issued an order to show cause why the case should not be dismissed for failure to prosecute. After hearing statements of counsel, and with no cause being shown why the matter should not be dismissed, an order of dismissal was entered. The order of dismissal is summary in nature, and no details of what was presented at the hearing were revealed. 4 This appears to be the end of the Jim litigation.
Bigman v. Utah Navajo Development Council, Inc.
While Jim was still pending, the complaint in Bigman was filed on February 7, 1977, by plaintiffs Seth Bigman and Martha Collins. Although the case was not filed as a class action, the complaint alleged it was “an action by Navajo Indians as beneficiaries of an oil royalty trust fund seeking to preserve and protect the fund from defalcation and misexpenditures.” Counsel for the Bigman Plaintiffs expressly avoided pursuing a class action due to tension between the original beneficiaries and the beneficiaries added by the 1968 amendment. The complaint alleged that Defendants had breached their fiduciary duty and requested an accounting as well as recovery of all money wrongfully expended from the Fund.
Seven months after the complaint was filed, the parties settled, and a Stipulated Judgment and Decree was entered by the *1278 Court on August 8, 1977. The settlement provided for review of (1) questionable transactions, as raised by the plaintiffs, of the records and accounts of defendant Utah Navajo Development Council (“UNDC”) from 1971 until present; (2) the UNDC’s accounting and management practices; and (3) the operation and management of medical clinics at Montezuma Creek, Mexican Hat, and Navajo Mountain. Because the Bigman case was not a class action, no notice of the proposed settlement or the district court’s review and acceptance of the settlement was provided to non-party beneficiaries.
The parties retained Dr. Roger Nelson to perform the review of the three issues set forth in the Stipulated Judgment and Decree. The result of Dr. Nelson’s investigation was a detailed report, referred to herein as the “Nelson Report,” which was filed with the district court on December 12, 1977. Section I of the Nelson Report investigated the management structure and operation of UNDC’s service division and medical climes, as well as the for-profit companies UNDC’s affiliate, Utah Navajo Industries, owned and ran. Section II of the Report investigated twenty-six “suspect transactions.” Section III summarized the management, organizational and accounting problems and Dr. Nelson’s recommendations for change. Although available for public inspection, it appears that the Nelson Report was not publicly distributed beyond the named plaintiffs.
Per the Stipulated Judgment and Decree, two remaining issues were presented to the district court without trial: (1) plaintiffs’ claim that the oil royalty trust funds are not public funds and that defendants were expending the funds for public and governmental purposes, in violation of federal law and the precedents of the court; and (2) plaintiffs’ claim that the defendants must implement a program of Navajo preference in employment practices and hiring in the administration and expenditure of the Fund. The court also stated in the Decree that it was not limiting the plaintiffs’ or other beneficiaries’ “right to seek relief from violations of the law in the administration and expenditures of the oil royalty trust funds as may occur subsequent to the filing of this decree.”
These issues were addressed by a Memorandum and Order issued on September 25, 1978. The district court determined that the preferential employment practices issue did not present a justiciable controversy and refrained from issuing what it characterized as an advisory opinion. The court further found that, on the record before it, it was “unable to ascertain whether the State of Utah has exceeded its authority or abused its discretion in directing the use of the funds for [certain specified purposes].” The court then declined to determine the lawfulness of specific expenditures due to lack of any evidentiary basis for doing so.
Having retained continuing jurisdiction over the enforcement or amendment of the Stipulated Judgment and Decree, the district court granted the parties’ stipulated petition for amendment of the settlement regarding the organization of the UNDC and Utah Navajo Industries, Inc. (“UNI”). In 1989, the court issued a Stipulation and Joint Motion and Order granting the UNI additional time to repay money it owed to the Navajo Trust Fund. By this time, Eric Swenson, lead plaintiffs’ attorney in Big-man, had switched sides and was representing the defendant UNDC. There was no further court activity in the Bigman case.
Present Case — Pelt v. State of Utah
In 1992, plaintiffs Jake C. Pelt and other named individuals, members of the beneficiary class (“Beneficiaries”), filed this action alleging, inter alia, that Utah breach *1279 ed its fiduciary duty to the class when it allegedly mismanaged the Fund. Beneficiaries seek (1) a full and accurate accounting of decades of income and disbursements from the Fund, and (2) reimbursement to the Fund for undocumented or improper disbursements and income. Like Jim, this suit was certified as a Rule 23(b)(2) class action.
Utah filed a motion to dismiss; which was granted on the grounds that the federal statute that created the Fund did not create a private right of action for breach of trust.
See Pelt v. Utah,
On remand, the parties agreed that Utah is required to produce an accounting and in June 2001, the district court entered an order establishing the parameters of Utah’s duty to account as well as Beneficiaries’ exceptions to such accounting. 5 The parties disagreed, however, on the issue of which years Utah is obligated to account for Fund expenditures. Beneficiaries request an accounting detailing trust activities back to the 1950’s; Utah asserts that accountings performed during the previous Fund cases satisfied Utah’s accounting obligation with respect to certain years. Specifically, Utah raised the affirmative defense of res judicata, arguing that a significant portion of Beneficiaries’ accounting claims is barred by the preclu-sive effect of Sakezzie, Jim and Bigman.
On December 20, 2002, the district court denied the parties’ cross-motions for summary judgment on the issue of claim preclusion. In that Order, the district court held that two of the three elements of the res judicata requirements had been established: (1) that the three prior cases “ended with a final decisions on the merits,” and (2) that “for purposes of determining res judicata, the claims in Pelt are identical to those alleged in Sakezzie, Jim and Bigman.” The district court declined to rule on the third element — whether Beneficiaries are in privity with the plaintiffs in the previous cases. The district court held that, “[i]n order to show privity between a non-party and a party to former litigation, the party who asserts that the matter is barred by claim preclusion must demonstrate that the nonparty’s interests and rights were represented and protected in the prior action.” The district court concluded that on the record before it, it could not determine whether Beneficiaries’ interests were adequately represented in the prior actions. The district court held that Utah failed to meet its burden to establish privity, as it had not affirmatively argued that the representation in the prior cases was adequate or offered any evidence of adequate representation. Likewise, the district court held, Beneficiaries had not established that the representation in the prior cases was inadequate. Because privity remained a disputed issue of material fact, Beneficiaries’ cross-motion was also denied.
In 2005, after extensive discovery, Beneficiaries moved for summary judgment on the question of whether their interests were adequately represented in Sakezzie, Jim and Bigman. In January 2006, the district court held that because Beneficia *1280 ries were not adequately represented in the prior class actions and there was no evidence of any legal relationship or other form of accountability between the Big-man and Pelt plaintiffs, Beneficiaries are not bound by the judgments therein. Citing its December, 2002 Order, the district court reaffirmed its holding that Utah, which raised the affirmative defense of claim preclusion, has the burden to establish that privity, or adequacy of representation, existed in the previous cases. The district court ruled that because Beneficiaries “are working with a clean slate,” Utah must account for Fund expenditures during the entirety of its administration of the Fund. This appeal followed.
III. STANDARD OF REVIEW
On appeal, Utah asserts that the district court erred in granting Beneficiaries’ motion for summary judgment. We review the district court’s grant of summary judgment
de novo,
applying the same legal standard as the district court.
Mountain West Mines, Inc. v. Cleveland-Cliffs Iron Co.,
“In our circuit, ‘[tjhe moving party carries the burden of showing beyond a reasonable doubt that it is entitled to summary judgment.’ ”
Trainor v. Apollo Metal Specialties, Inc.,
Conversely, if the moving party has the burden of proof, a more stringent summary judgment standard applies. Thus, if the moving party bears the burden of proof, to obtain summary judgment, it cannot force the nonmoving party to come forward with “specific facts showing there [is] a genuine issue for trial” merely by pointing to parts of the record that it believes illustrate the absence of a genuine issue of material fact.
Mudrick v. Cross Services, Inc.,
While the issue of whether privity exists is a question of fact,
Lowell Staats Mining Co., Inc. v. Philadelphia Elec. Co.,
IV. DISCUSSION
A. Nonparty Preclusion
Pursuant to the doctrine of res judicata “[a] final judgment on the merits of an action precludes the parties or their privies from relitigating issues that were or could have been raised in that action.”
Wilkes v. Wyo. Dep’t of Employment Div. of Labor Standards,
As for the second factor, there is no question that the named plaintiffs in the earlier suits were not the same as the named plaintiffs in the instant action. It is a fundamental rule of civil procedure that one who was not a party to an action is not bound by the judgment.
Richards v. Jefferson County, Ala.,
An exception to this rule exists when it can be said that there is “privity” between a party to the second case and one who is bound by an earlier judgment.
Richards,
Taylor noted six categories of recognized exceptions to the general rule against nonparty preclusion: (1) when a person agrees to be bound by the determination of issues in an action between others; (2) when a pre-existing substantive legal relationship exists; (3) when a non- *1282 party was “adequately represented by someone with the same interests who [wa]s a party” in an earlier suit; (4) when the nonparty assumed control over the earlier litigation; (5) when a party who did not take part in litigation, as a way of avoiding preclusion, later sues as the designated representative of a person who was a party to the earlier suit; and (6) when a special statutory scheme, such as bankruptcy, so directs. Id. at 2172-73.
Significant to this appeal, Taylor reaffirmed the limitations attending nonparty preclusion based on adequate representation:
A party’s representation of a nonparty is “adequate” for preclusion purposes only if, at a minimum: (1) the interests of the nonparty and her representative were aligned, see Hansberry,311 U.S. at 43 ,61 S.Ct. 115 ; and (2) either the party understood herself to be acting in a representative capacity or the original court took care to protect the interests of the non-party, see Richards,517 U.S. at 801-802 ,116 S.Ct. 1761 .... In addition, adequate representation sometimes requires (3) notice of the original suit to the persons alleged to have been represented, see Richards,517 U.S. at 801 ,116 S.Ct. 1761 . In the class-action context, these limitations are implemented by the procedural safeguards contained in Federal Rule of Civil Procedure 23.
Id. at 2176.
Also significant is
Taylor’s
rejection of an expansive “virtual representation” exception to nonparty preclusion.
Id.
at 2178. Under this doctrine, “a person may be bound by a judgment even though not a party if one of the parties to the suit is so closely aligned with his interests as to be his virtual representative.”
Meza v. Gen. Battery Corp.,
recogniz[e], in effect, a common-law kind of class action.... That is, virtual representation would authorize preclusion based on identity of interests and some kind of relationship between parties and nonparties, shorn of the procedural protections prescribed in Hansberry, Richards, and Rule 23. These protections, grounded in due process, could be circumvented were we to approve a virtual representation doctrine that allowed courts to “create defacto class actions at will.”
Id.
at 2176 (quoting
Tice v. Am. Airlines, Inc.,
Where a change of law occurs while a case is on appeal, we apply the law in effect at the time of our decision.
Miller v. City of Mission,
B. Burden of Proof
As an initial matter, Utah contends that the district court erred when it ruled
*1283
that Utah had the burden of establishing privity and thus, adequate representation. Generally, claim preclusion is an affirmative defense and it is incumbent upon the defendant to plead and prove such a defense.
Taylor,
Taylor
rejected a similar burden-shifting argument that on remand the plaintiff should bear the burden of proving he was not acting as an agent of a party bound by the prior adjudication. In that case, the defendant maintained that when a defendant points to evidence establishing a close relationship between successive litigants, the burden shifts to the plaintiff to submit evidence refuting the charge of agency.
Taylor,
Claim preclusion, like issue preclusion, is an affirmative defense.... Ordinarily, it is incumbent on the defendant to plead and prove such a defense, ... and we have never recognized claim preclusion as an exception to that general rule.... We acknowledge that direct evidence justifying nonparty preclusion is often in the hands of plaintiffs rather than defendants .... but “[v]ery often one must plead and prove matters as to which his adversary has superior access to the proof.” ... In these situations, targeted interrogatories or deposition questions can reduce the information disparity. We see no greater cause here than in other matters of affirmative defense to disturb the traditional allocation of the proof burden.
Id. at 2180.
Thus, because Utah has raised the affirmative defense of claim preclusion, it has
*1284
the burden to establish that privity exists in the prior cases, that is, that Beneficiaries were adequately represented.
Id.; Nwosun v. Gen. Mills Rest.,
C. Adequate Representation
1. Class Actions
It is well settled that a class action judgment is binding on all class members.
See Hansberry v. Lee,
Because the prior lawsuits in this matter span both pre- and post-amendment to Fed.R.Civ.P. 23, some historical background is instructive. Prior to the 1966 amendment of Rule 23, class actions were placed in three categories. A “true class” action in which the right to be enforced was “joint,” “common,” or “secondary in the sense that the owner of a primary right refuses to enforce that right and a member of the class thereby becomes entitled to enforce it.” 7A Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1752 (3d ed.2007). All class suits that were not “true” were either “hybrid” or “spurious,” in which the claims urged were “several” rather than joint or common. In a “hybrid” action, the object of the proceeding was the adjudication of claims that did or might affect specific property involved in the action. Id. A “spurious” action was one in which the action was based solely on common questions. 7A Wright & Miller, supra, § 1777. The effect of a judgment in a class action depended on the characterization of the suit. A judgment rendered in a “true” class action was binding on all class members; a judgment in a “hybrid” suit bound the class members only with regard to their rights in the res that was in controversy; and a judgment in a “spurious” class suit bound only the parties actually before the court. 7A Wright & Miller, supra, § 1789.
Because the 1966 amendments to Rule 23 eliminated the distinctions between class actions, and consequentially the degrees of preclusive effect accruing in each, the requirement of adequate representation has become more critical. Rule 23 was drawn to meet constitutional requirements — subsection (a)(4) requires that the class be adequately represented and subsection (c)(2) requires that notice be given to absent class members in Rule 23(b)(3) actions; notice also will usually be provided in Rule 23(b)(1) and (b)(2) actions, at the discretion of the court.
See
Fed. R.Civ.P. 23. These prerequisites meet the standard established by the Supreme Court in
Hansberry,
The determination made by the original class action court that the representative adequately represented the class
*1285
members, even though correct when made, may not be correct at later stages of the litigation. It is well settled that a court adjudicating a class action cannot predetermine the res judicata effect of its own judgment; that can only be determined in a subsequent suit.
Taunton Gardens Co. v. Hills,
The standard for evaluating adequacy of representation in a class action suit was discussed by the Fifth Circuit in
Gonzales,
where the court established a two-prong test to determine whether adequacy of representation was satisfied: “(1) [d]id the trial court in the first suit correctly determine, initially, that the representative would adequately represent the class? and (2)[d]oes it appear, after termination of the suit, that the class representative adequately protected the interest of the class?”
primary criterion for determining whether the class representative had adequately represented his class for purposes of res judicata is whether the representative, through qualified counsel, vigorously and tenaciously protected the interests of the class. A court must view the representative’s conduct of the entire litigation with this criterion as its guidepost.
Id. at 75. The adequacy inquiry following final judgment “necessarily requires a hindsight approach to the issue of adequate representation, and in no way reflects on the [district] court’s conclusion [at the outset] that the [class representative] would adequately represent the class.” Id. at 73 n. 11. After consideration of these standards, the Gonzales court concluded that the representative’s failure to appeal an order denying retroactive relief to all class members except the representative constituted inadequate representation of the class. Id. at 75-76.
We have distinguished
Gonzales,
which permitted a Rule 23(b)(2) collateral attack, from class actions certified under Rule 23(b)(3). There are no mandatory notice requirements in subsections (b)(1) and (b)(2) actions, and members do not have the opportunity to opt out of the class, opportunities accorded to subsection (b)(3) class members.
See In re Four Seasons Sec. Laws Litig.,
Although this Circuit has not specifically applied the demanding
Gonzales
formula, we have similarly held that “[t]he question of adequate representation can best be resolved by determining whether the interests of those who would attack the judgment were vigorously pursued and protected in the class action by qualified counsel.”
Garcia v. Bd. of Edu.,
Answering the question of adequate representation in the affirmative, we pointed out the fact that the prior litigation had gone on for seven years was evidence in itself that it was a hard fought contest; that the desegregation plan ultimately adopted by the district court was developed by the court’s own expert; and that the court had rejected each of the parties’ plans as being too one sided. Id. at 680. Stating that the plaintiffs’ argument that their interests were not identical with all those of the plaintiff classes in the prior litigation did not preclude the application of res judicata, we concluded that where substantially all of the plaintiffs’ interests were vigorously presented in the litigation by the various parties, there was no justification for allowing the litigation to be effectively reopened and we affirmed the district court’s application of res judicata. Id.
Application to Sakezzie and Jim
The district court’s determination that Beneficiaries were not adequately represented by the Sakezzie and Jim plaintiffs focused on the fact that, despite Utah’s failure to provide an accounting as ordered, both cases were dismissed by the court for failure to prosecute after an order to show cause had been issued. Based on the record before ús, we are compelled to agree that the Sakezzie and Jim plaintiffs failed to vigorously pursue and protect the Beneficiaries’ interests.
We assume for present purposes that the minimum requirements for adequate representation set forth in Taylor, alignment of interests and steps taken by the courts to protect non-party interests, have been met. While it is not clear whether Sakezzie was a “true” or “hybrid” class action, it is clear that it was not “spurious,” thus binding class members, and Jim was certified as a class action pursuant to Rule 23(b)(2). A determination that the minimum requirements for adequate representation have been met does not necessarily end the inquiry, however, and our analysis turns on whether binding Beneficiaries would violate due process, that is, whether Beneficiaries were “in fact” adequately represented in Sakezzie or Jim.
After the initial
Sakezzie
complaint was filed, Utah provided answers to interrogatories containing what Utah characterized as “accounting information.” This information was summary in nature and included no supporting documentation. When the district court concluded that these an
*1287
swers to interrogatories mooted the accounting claim, the plaintiffs did not object, and the court subsequently entered an order stating that Utah had fully informed the plaintiffs of receipts and expenditures from the Fund.
Sakezzie I,
The Sakezzie plaintiffs then filed a second petition alleging that Utah was not complying with the district court’s order and seeking monthly accounting reports for the Fund. Ultimately, the second petition resulted in Sakezzie II, where the district court specifically ordered Utah to make monthly accounting reports. Despite the strongly-worded order of the district court, Utah again failed to comply with the monthly reporting requirement, and the Sakezzie plaintiffs filed a third petition. After more than a year, the case was dismissed by the court for failure to prosecute after an order to show cause had been issued. Although the district court granted leave to file an amended petition, the plaintiffs took no action.
Similarly, the Jim plaintiffs successfully obtained an order directing Utah to file monthly accounting reports, not only for the period involved in that lawsuit, but for the period previously ordered in Sakezzie. On remand from the Supreme Court, the district court held that the accounting ordered in its 1972 Interlocutory Decree and Order had not been done and that the Jim plaintiffs were entitled to an accounting. The court again ordered Utah to file a complete and comprehensive accounting. Thereafter, when plaintiffs confirmed that an accounting had yet to be completed, the court emphasized that the accounting was “the most important part of the lawsuit, really,” noting that it had not been accomplished as late as May 25, 1976. Notwithstanding the district court’s edict, no further action was taken in the Jim case until more than two years later, in December 1978, when the court issued an order to show cause why the case should not be dismissed for failure to prosecute. As'noted above, the case was dismissed, with prejudice.
Neither case scenario depicts a situation in which Beneficiaries’ interests were vigorously pursued and protected by the class representatives. The class representatives in both cases successfully obtained orders directing Utah to provide accountings. After two class actions spanning almost seventeen years, however, Utah had yet to provide an accounting to either the Sakez-zie or Jim plaintiffs and, remarkably, both class actions were dismissed for failure to prosecute after an order to show cause had been issued by the respective courts. Nevertheless, Utah asks us to reverse the district court’s conclusion that Beneficiaries were not adequately represented in Sakezzie or Jim.
Utah contends that vigorous pursuit and protection of absent class members’ interests depends on an identity of interests between the named plaintiffs and the absent class members. Thus, Utah argues, the district court erroneously conducted a qualitative evaluation of class counsel’s performance by second-guessing actual trial strategy in Sakezzie and Jim because the only relevant consideration is identity of interests between prior and current plaintiffs. Instead, Utah asserts, this Court should focus on the incentive to litigate created by the close alignment of the interests at issue. We disagree.
While it is true that the parties’ interests in the Fund are the same, shared interests do not alone ensure adequate protection. Once the case proceeds to final judgment and is asserted as part of a claim preclusion defense, the question shifts from incentive to litigate to whether the absent parties’ interests were
in fact
vigorously pursued and protected.
See
*1288
Hansberry v. Lee,
Moreover, the adequacy determination following final judgment “necessarily requires a hindsight approach to the issue of adequate representation, ...”
Gonzales,
Contrary to Utah’s assertions, we need not “second guess” class counsel’s litigation strategy or tactics in
Sakezzie
or
Jim
in order to determine that the class representatives, through counsel, failed to follow through or take action on the accounting issues, which ultimately resulted in no ac-countings and the dismissal of both cases for failure to prosecute. Utah counters that even a class representative’s decision to abandon a claim is not
per se
inconsistent with adequate representation. Utah is correct that in the context of settlement, abandonment of claims can be a reasonable litigation tactic that does not necessarily support a finding of inadequate representation, citing
Wal-Mart Stores, Inc. v. Visa U.S.A., Inc.,
Finally, in declining to give preclusive effect to the judgment entered in
Jim,
the district court noted the
Jim
court’s failure to provide formal notice to the class members and stated that the record did not support a finding that the
Jim
case’s “notoriety” generated the kind
of
notice necessary to protect the rights of absent class members. Utah argues that because the manner in which the
Jim
class was certified was constitutionally adequate, the district court erred by holding the
Jim
class certification to a higher standard than required by Rule 23. The
Jim
class action was maintained under Rule 23(b)(2), which provides an action may be maintained as a class action when “the party opposing the class has acted or refused to act on grounds generally applicable to the class, thereby making appropriate final injunc-tive relief or corresponding declaratory re
*1289
lief with respect to the class as a whole.” The fact that the
Jim
class members did not receive formal notice is not dispositive of the issue of claim preclusion. Due process does not require notice for absent class members in all actions under Rule 23(b)(2), as long as the class members were adequately represented.
Alexander v. Aero Lodge No. 735, Int’l Assn. of Machinists & Aerospace Workers, AFL-CIO,
In so ruling, we recognize the importance of finality of judgments and do not read the adequacy of representation inquiry as requiring second-guessing of every litigation decision. As one court succinctly stated, “[d]ue process entitles class members to notice and to adequate representation. It does not entitle them to continue to challenge the defendant’s conduct until they are ultimately successful.”
Quigley v. Braniff Airways, Inc.,
2. Non-Class Actions
Likewise, it is clear from the record that preclusion cannot be justified on the grounds that Beneficiaries were adequately represented in
Bigman.
As previously discussed, the Supreme -Court has established that in addition to alignment of interests, representation is adequate for purposes of nonparty preclusion only if, at a minimum, special procedures were taken in the first case to protect the interest of absent parties or the parties to the first litigation understood their suit to be in a representative capacity.
Taylor,
D. Substantive Legal Relationship
Utah originally argued on appeal that privity is established under the doctrine of virtual representation because the Beneficiaries’ legal interests in the Fund are identical to those of the
Bigman
plaintiffs and because the instant case is “in the nature of’ an action to vindicate a public right. Because all plaintiffs, past and present, are co-beneficiaries of the Fund, and because their interest in the Fund is common rather than personal, Utah argued that litigation relating to the Fund necessarily decides every beneficiary’s rights. Thus, Utah argued, the district court’s finding that there was no evidence
*1290
of any legal relationship or form of accountability “overlooks the reality of the interest at issue in
Bigman.”
In support of its argument, Utah relied on the Eighth Circuit’s decision in
Tyus v. Schoemehl,
Utah’s argument is no longer viable in light of
Taylor,
which not only rejected the theory of virtual representation, but also rebuffed the argument that a broader reading of nonparty preclusion is appropriate in “public law” litigation.
Taylor,
Utah stopped short of contending that all of the actions brought by beneficiaries of the Fund fall within the category described in
Richards,
arguing instead that the claims related to the Fund are “in the nature of’ a taxpayer suit. Although the beneficiaries of the Fund share a common interest in the Fund, it does not appear that this interest is shared in common with the public or indeed, even with the Navajo Nation Tribe. Even if this case were construed as a public right action, however, the
Taylor
Court clarified that
Richards
merely stated that, “for the type of public-law there envisioned, States are free to adopt procedures limiting repetitive litigation.”
Taylor,
Recognizing the futility of its virtual representation argument, Utah recasts its claim that nonparty preclusion is justified under the pre-existing substantive legal relationship exception. The district court considered a similar question in addressing the whether an express or legal relationship was a prerequisite to a virtual representation claim. Qualifying relationships include, but are not limited to, preceding and succeeding owners of property, bailee and bailor, assignee and assignor, guardian and ward and trustee and beneficiary.
Richards,
We disagree with Utah’s characterization of the Fund beneficiaries’ relationship. As recognized by the district court, a substantive legal relationship as contemplated by the exception is one in which the parties to the first suit are somehow accountable to nonparties who file a subsequent suit raising identical issues. Utah has never alleged a fiduciary, contractual or property relationship between current and prior litigants. Indeed, *1291 Utah continues to argue, as it did in support of its theory of virtual representation that the beneficiaries of the Fund do not hold individual or collective property rights; instead, they share an indivisible, collective interest in the trust corpus, and any obtainable remedy benefits all beneficiary class members. Such concurrent property relationships do not justify non-party preclusion. See 18A Wright & Miller, supra § 4461 (explaining the general rule that such concurrent relationships do not justify nonparty preclusion, but are likely to provide better justification for a virtual representation analysis than most other circumstances).
There is nothing in the record to support a finding that any Fund beneficiary was authorized to bring suit or was in any way accountable to any other co-beneficiary, except as representatives within the context of the class actions. Instead, it appears that the
Bigman
plaintiffs were mere self-appointed volunteers without authority to bind any other beneficiaries by litigation. Such an elastic concept of privity violates due process of law.
Richards,
V. CONCLUSION
We AFFIRM the district court’s order finding that Beneficiaries’ claim in Pelt is not precluded by the judgments in Sakez-zie, Jim, or Bigman. The case is REMANDED for proceedings consistent with this opinion. Utah’s motion for supplemental oral argument is DENIED.
Notes
. The district court determined that its ruling involved a controlling question of law about which there is substantial ground for difference of opinion, and that an immediate appeal would hasten resolution of the litigation. Fed.R.Civ.P. 54(b). Specifically, the district court found that its ruling "fully impacts adjudication of the remaining claims.... [I]t would be a waste of this court’s and counsels’ time to document and analyze decades of trust account management if on appeal the Tenth Circuit finds that the Pelt Plaintiffs were indeed adequately represented in the three earlier cases.”
. Utah's Br. 06-4164 at 2-3.
. Rule 41 of the Federal Rules of Civil Procedure, which describes the effect of an involuntary dismissal, states, as it did in 1978, that "[ujnless the court in its order for dismissal otherwise specifies, a dismissal under this subdivision ... operates as an adjudication on the merits (i.e., is with prejudice).” The 1978 Order of Dismissal did not specify that dismissal would be without prejudice.
. Prior to the order establishing accounting guidelines, the district court apparently dismissed Utah’s statute of limitations and lach-es defenses.
See Pelt v. Utah,
No. 92-CV-639-TC,
. Beneficiaries contend that Utah did not adequately preserve its argument that they bear the burden to prove inadequate representation. This argument was raised by Utah and rejected by the district court in its December 20, 2002 order, where the court held that Utah bore the burden to prove adequate representation as part of its res judicata affirmative defense. In its subsequent briefing on privity and adequate representation, Utah complied with the district court’s determination and offered evidence and argument that representation in the prior cases was adequate. In its 2006 order granting summary judgment on the privity issue, the district court again placed the burden to prove adequacy of representation on Utah and this order was certified for immediate appeal under 28 U.S.C. § 1292(b). The language of § 1292(b) makes clear that “appellate jurisdiction applies to the
order
certified to the court of appeals, and is not tied to the particular question formulated by the district court.”
Yamaha Motor Corp., U.S.A. v. Calhoun,
. In any event, Beneficiaries presented evidence that their interests were inadequately represented in the previous cases. Instead of merely pointing to parts of the record that illustrated the absence of a genuine issue of material fact, Beneficiaries sought to establish, as a matter of law, that their accounting claims were not precluded because their interests were inadequately represented. Indeed, Beneficiaries specifically argue in their motion for summary judgment that the undisputed facts support a finding of inadequate representation. Moreover, the district court did not find that Utah had failed to meet its burden of proof that Beneficiaries were adequately represented. Instead, it made extensive findings that Beneficiaries were not adequately represented.