Lawlor v. National Screen Service Corp., 349 U.S. 322 (1955)

Lawlor v. National Screen Service Corp.

No. 163

Argued February 9-10, 1955
Decided June 6, 1955
349 U.S. 322

CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

Syllabus

In 1942, alleging that the defendants had conspired to establish a monopoly in the distribution of motion picture advertising material, petitioners and others brought an antitrust action for treble damages and injunctive relief against National Screen and three motion picture producers who had granted exclusive licenses to National Screen to manufacture and lease such material. In 1943, pursuant to a settlement made before trial and without any findings of fact or law having been made, that action was dismissed "with prejudice," and sublicenses were granted by National Screen to the plaintiffs. In 1949, petitioners brought a similar action against the same defendants, plus five additional motion picture producers, alleging that settlement of the 1942 suit was merely a device used to perpetuate the conspiracy and monopoly, that the five additional producers had since joined the conspiracy, and that National Screen had deliberately made slow and erratic deliveries under the sublicense in an effort to destroy petitioners’ business and had used tie-in sales and other means of exploiting its monopoly power. Petitioners sought damages for only those injuries sustained after the 1943 judgment.

Held: the 1949 action was not barred by the 1943 judgment under the doctrine of res judicata. Pp. 323-330.

(a) Since the 1943 judgment was not accompanied by findings, it did not bind the parties on any issue -- such as the legality of the exclusive license agreements or their effect on petitioners’ business -- which might arise in connection with another cause of action. Pp. 326-327.

(b) Whether the defendants’ conduct be regarded as a series of individual torts or as one continuing tort, the two suits were not based on the same cause of action, and the 1943 judgment does not bar the 1949 suit. Pp. 327-328.

(c) A different result is not required by the fact that the 1942 complaint sought, in addition to treble damages, injunctive relief which, if granted, would have prevented the illegal acts now complained of. Pp. 328-329.

(d) With respect to the five defendants who were not parties to the 1942 suit, moreover, their relationship to the other defendants was not close enough to bring them within the scope of the doctrine of res judicata. Pp. 329-330.

211 F.2d 934 reversed.