The opinion of the court was delivered by: John F. Keenan, United States District Judge
Defendant/Counterclaimant The RobeWorks, Inc. ("RobeWorks") moves pursuant to Federal Rule of Civil Procedure 60(b)(5) seeking relief from the judgment of this Court granting summary judgment to Plaintiff/Counterclaim-defendant Russell-Newman, Inc. ("Russell-Newman"). For the reasons outlined below, the motion is denied.
On February 11, 2000, RobeWorks commenced an action in the Central District of California ("the California action") against another robe manufacturer, Chou & Associates, Inc. ("Chou") alleging that RobeWorks' trade dress rights in its robes were infringed by Chou's robe. The district court dismissed the California complaint finding that the use of micro-fiber and terrycloth layers in RobeWorks' robe is functional and not subject to trade dress protection. RobeWorks appealed that decision to the Ninth Circuit.
Russell-Newman filed this action against RobeWorks on December 28, 2000, seeking a declaration that the robe sold by RobeWorks does not contain any trade dress subject to protection under federal or state law. This Court granted summary judgment to Russell-Newman on the ground of collateral estoppel.
The doctrine of collateral estoppel is designed to protect litigants "from the burden of relitigating an identical issue . . . and to promote judicial economy by preventing needless litigation." Whimsicality, Inc. v. Battat, et al., 27 F. Supp.2d 456, 462 (S.D.N.Y. 1998) (citations omitted). Grounded in principles of due process and fairness, collateral estoppel "also acts to conserve the resources of courts and litigants, reduce inconsistent results, and promote the interest in finality of judgments." Lennon v. Seaman, 99 Civ. 2664, 2002 WL 109525, at *3 (S.D.N.Y. Jan. 28, 2002) (quoting Conte v. Justice, 966 F.2d 1398, 1400 (2d Cir. 1993)). The doctrine "fosters reliance on judicial action by minimizing the possibility of inconsistent decisions." Elmasri v. England, 111 F. Supp.2d 212, 219 (E.D.N.Y. 2000) (quoting Remington Rand Corp. v. Amsterdam-Rotterdam Bank, N.V., 68 F.3d 1478, 1485 (2d Cir. 1985)).
In evaluating whether collateral estoppel applies, the court must also determine that the issue in the prior proceeding was actually litigated and decided, that there was full and fair opportunity to litigate in the prior proceeding, and that the issue previously litigated was necessary to support a valid and final judgment on the merits. State of New York v. Nasso, 202 F.3d 82, 86 (2d Cir. 2000).
In granting summary judgment to Russell-Newman, the Court considered these principles. The evidence presented in the California action led to a final valid judgment, the merits of which have not been disturbed by any court. On April 24, 2003, a Stipulation was entered and endorsed by Judge Dean D. Pregerson in the California action (The RobeWorks, Inc. v. Chou & Associates, Inc., No. CV 00-01529), vacating the Order and Judgment entered March 29, 2001, and "finding that the judgment shall not have preclusive effect." That Order stated that it come into existence "[p]ursuant to the terms of a confidential settlement agreement."*fn1 That Order does not address the soundness of the California judgment nor does it address the legal principles underlying it. Further, it does not in any way change the reasoning of the original decision dismissing the California complaint.
RobeWorks had the opportunity to litigate these issues in the California court and is not being deprived of the right to do so. Instead, RobeWorks litigated the issues and was unsuccessful. The agreement between the parties to vacate that decision does not render the District Court's analysis and conclusions moot. Permitting RobeWorks to relitigate previously adjudicated matters runs afoul of the principles of collateral estoppel.
This Court is not bound by an agreement between private parties to vacate the California action to similarly vacate its decision granting summary judgment to Russell-Newman. RobeWorks' motion is denied.