When litigating with a party likely to be involved in frequent litigation, it is important to keep in mind the potential use of what is known as collateral estoppel, or issue preclusion. Collateral estoppel may preclude a party from rearguing an issue it lost in earlier litigation in subsequent, unrelated lawsuits. Many litigators may not realize that some jurisdictions apply collateral estoppel more broadly than others. For instance, some jurisdictions do not require that a party asserting collateral estoppel have been a party to the prior litigation in order to benefit from the doctrine’s effects. Litigators should familiarize themselves with the lesser-known nuances of this equitable doctrine so they do not miss an opportunity to assert it where it would be advantageous to their clients.
The collateral estoppel doctrine may be available in a wide range of cases. And parties and their counsel should be aware of when it may or may not apply. For example, individual insurance carriers often use the same provisions in different policies over the course of numerous years, and may litigate particular coverage issues or disputes over specific policy provisions with many different policyholders over time. The same is true of reinsurers that may frequently litigate the same issues with different reinsureds. A court’s ruling on those recurring disputes could impact how similar disagreements in subsequent lawsuits are resolved, even if the later lawsuits involve different parties. Individual courts and jurisdictions will need to assess whether the factors and requirements of collateral estoppel have been met in any given case.
