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United States District Court, S.D. New York

March 26, 2004.


The opinion of the court was delivered by: ROBERT PATTERSON, Senior District Judge


Defendants AAK Limited and Maurice Ian Kindler (collectively, defendants") move for the Court to reconsider a portion of its opinion dated September 8, 2003 pursuant to Fed.R.Civ.P. 60(b) and Rule 6.3 of the Local Civil Rules. The portion of the Court's opinion in question granted the summary judgment motion of Plaintiff Mario Valente Collezioni, Limited ("Plaintiff') against Defendants on the issue of collateral estoppel on the Plaintiff's claim of unfair competition.

I. Background

  Because the facts of the case as pleaded have been laid out in detail in the September 8, 2003 opinion, an abbreviated summary is provided below.

  A. Procedural History

  In 1997 Plaintiff brought an action for breach of contract, trademark infringement and unfair competition against Confezioni Semeraro Paulo, S.R.L, et. al. (the "Semeraro Defendants"). The Semeraro Defendants, who are located in Italy, did not respond; therefore a Page 2 default judgment was entered against them. See Mario Valente Collezioni, Ltd. v. Confezioni Semeraro Paulo, S.R.L., 115 F. Supp.2d 367, 369 (S.D.N.Y. 2000). Magistrate Judge Eaton held an inquest in order to determine a recommendation for damages to be awarded to Plaintiff. The Semeraro Defendants did not appear at the inquest. The Semeraro Defendants also defaulted on a subsequent action commenced by Plaintiff in Italy in order to collect the judgment awarded to them.

  The next actions in the Semeraro litigation were described by this Court in its September 8, 2003 opinion as follows:

On March 24, 1999, the Semeraro defendants filed a motion before Judge Kaplan, pursuant to Rules 55(c) and 60(b) of the Federal Rules of Civil Procedure to vacate the default judgment entered against them, claiming lack of jurisdiction. [Mario Valente Collezioni, Ltd., 115 F. Supp.2d at 368-69.] After an evidentiary hearing conducted on February 8, February 9 and June 20, 2000, during which Defendant Kindler, Mr. Semeraro, his son-in-law and other witnesses testified, (id. at 376) Judge Kaplan denied the motion. Id. at 378. The decision was appealed by the Semeraro defendants, and the Second Circuit held that the district court properly found personal jurisdiction over the Semeraro defendants, but erred in failing to perform a federal due process analysis. Mario Valente Collezioni, Ltd. v. Confezioni Semeraro Paolo. S.R.L., 264 F.3d 32 (2d Cir. 2001. The Second Circuit affirmed and remanded the case back to Judge Kaplan on the due process issue. Id. at 38. On remand, Judge Kaplan found that the exercise of personal jurisdiction over the Semeraro defendants did not violate due process of law and the judgment became final. Mario Valente Collezioni, Ltd. v. Confezioni Semeraro Paolo. S.R.L., 174 F. Supp.2d 170, 176 (S.D.N.Y. 2001). No part of the judgement has been paid. (Selig Dep. at 244.)
Mario Valente Collezioni, Ltd. v. AAK Limited and Maurice Ian Kindler, 280 F. Supp.2d 244, 246-47 (S.D.N.Y. 2003).

  In January 2002, Plaintiff filed a complaint against Defendants alleging unfair competition, trademark infringement and breach of contract. On September 8, 2003, the Court issued an opinion granting Defendants' motion for summary judgment on Plaintiff's claims of Page 3 breach of contract and trademark infringement, and granting Plaintiff's cross-motion for summary judgment with respect to Defendants' liability for unfair competition. Id. Defendants now move the Court to reconsider its decision with respect to their liability for unfair competition.

  B. Summary of Facts

  In 1994 Paolo Semeraro and A.E.D. Imports, Ltd. entered into an agreement for the distribution of coats in the United States. (Defs.' Statement Material Facts As to Which There Is No Genuine Issue to be Tried at ¶ 6; Pl.'s Am. Counterstatement Undisputed Facts at ¶ 6.) The agreement stated, "Confezioni PAOLO SEMERARO hereby undertake that no clothing will be offered by them or anyone acting on their behalf for sale in the U.S.A. except through A.E.D. IMPORTS LTD. their appointed DISTRIBUTORS/IMPORTERS. THIS AGREEMENT IS VALID ONLY FOR PRODUCTION OF MEN'S OVERCOATS." (Notice of Mot, Mar. 13, 2003, Ex. 4.) Judge Kaplan found that "[b]y course of dealing, the parties had substituted Plaintiff for A.E.D. as the exclusive U.S. distributor of defendants' overcoats." Mario Valente Collezioni, 115 F. Supp.2d at 375 n.40.

  Defendant Maurice Kindler is the principal owner of AAK, a United Kingdom limited liability corporation, which sells garments at whole-sale. (Defs.' Statement Material Facts As to Which There Is No Genuine Issue to be Tried at ¶¶ 3, 4; Pl.'s Am. Counterstatement Undisputed Facts at ¶¶ 3, 4.) Kindler testified at the evidentiary hearing before Judge Kaplan that AAK was the exclusive distributor in the United Kingdom of coats made by the Semeraro defendants. (Hr'g Tr. June 20, 2000 at 42-43 (No. 97 Civ. 2008, Docket Number 50).)

  Judge Kaplan found: Page 4


Kindler, AAK's chairman, knew that plaintiff had the exclusive right to sell Mario Valente overcoats in the United States. But he admitted that Semeraro told him that he had had a falling out with Selig*fn1 and that Selig no longer was buying from him. So Kindler set up a meeting with the Bloomingdale's buyer who previously had bought Mario Valente coats from plaintiff. He also solicited the aid of his friend, Joseph Sheer, in selling defendants' overcoats in the United States, and Sheer contacted Lord & Taylor, another of plaintiff's major customers.
Mario Valente Collezioni, Ltd., 115 F. Supp.2d at 374-75 (footnotes omitted). Judge Kaplan also found that as a consequence of the contacts of Kindler and Joseph Sheer (acting as Kindler's agent) with Bloomingdale's and Lord & Taylor, respectively, the two stores "dropped plaintiff as a supplier both for private label and Mario Valente brand coats." Id. Judge Kaplan concluded:
[I]t is more likely than not that Semeraro and Kindler together hatched a scheme to dump plaintiff as the U.S. distributor of Semeraro's products, to replace it with Kindler's firm, and to persuade plaintiff's existing U.S. customers and others that plaintiff no longer was a factor in the business and that AAK was the exclusive source in the United States of Mario Valente brand goods as well as Semeraro's other products. In such circumstances, Semeraro is legally responsible for all actions by Kindler and his agents in furtherance of the plan.
Mario Valente Collezioni, Ltd., 115 F. Supp.2d at 376. It is clear from Judge Kaplan's opinion that since Kindler acted as Semeraro's agent, Kindler's actions in New York to divert business away from Plaintiff subjected the Semeraro Defendants to the Court's jurisdiction on the tort claims under C.P.L.R. § 302(a)(2). See Mario Valente Collezioni, Ltd., 115 F. Supp.2d at 376-77.

  Kindler testified as a witness for the Semeraro Defendants on June 20, 2000, the last of the three days of hearings held by Judge Kaplan, on the jurisdictional issue of whether the Page 6 appropriate to do so. Fed.R.Civ.P. 60(b). The most relevant set of reasons provided is "mistake, inadvertence, surprise, or excusable neglect." Id. Local Rule 6.3 provides the filing guidelines for motions for reargument. Under Local Rule 6.3, a motion for reargument may be granted when there is a "need to correct a clear error or prevent manifest injustice" Morales v. Quinfiles Transnational Corp., 25 F. Supp.2d 369, 372 (S.D.N.Y. 1998) (quoting Doe v. New York City Dep't of Soc Servs., 709 F.2d 782, 789 (2d Cir. 1983)). Furthermore, a reargument may be granted when a court has "overlooked controlling decisions or factual matters which were placed before [it] in the underlying motion." Bonnie and Co. Fashions v. Banker's Trust Corp., 171 F.R.D. 79, 83-84 (S.D.N.Y. 1997). Nonetheless, the party requesting the reargument "may not advance new facts, issues, or arguments not previously presented to the court." Litton Industries. Inc. v. Lehman Bros. Kuhn Loeb, Inc., 1989 WL162315 at * 3 (S.D.N.Y. Aug. 4, 1989). Nor may it make "repetitive arguments on issues that have been considered folly by the court." In Re Houbigant, Inc., 914 F. Supp. 997, 1001 (S.D.N.Y. 1996).

  In the case at hand, the Court did not grant adequate deference to New York State law concerning collateral estoppel, and so will reconsider its previous decision in light of New York State law. In its previous decision, the Court acknowledged that New York State law applies to the issue of collateral estoppel in cases invoking diversity jurisdiction. Mario Valente Collezioni, 280 F. Supp.2d at 252 (citing Semtek Int'l Inc. v. Lockheed Martin Corp., 531 U.S. 497, 508-09 (2001)). Nonetheless, in its September 8, 2003 decision, the Court relied on two federal decisions. See id. at 253, 257 (citing Stichting Ter Behartiging Van De Belangen Van Oudaandeelhouders In Het Kapitaal Van Saybolt International B.V. v. Schreiber, 327 F.3d 173, Page 7 185 (2d Cir. 2003)) and id. at 252, 257 (citing Marvel Characters, Inc. v. Simon, 310 F.3d 280, 288-89 (2d Cir. 2002)).

  In Marvel Characters, Inc. v. Simon the parties agreed that `there is no discernable difference between federal and New York law concerning res judicata and collateral estoppel" Marvel Characters, Inc., 310 F.3d at 286. In Pike v. Freeman, the Second Circuit stated `there appears to be no significant difference between New York preclusion law and federal preclusion law" so the court made determinations about res judicata based upon federal law. Pike v. Freeman, 266 F.3d 78, 90 n.14 (2d Cir. 2001). The federal cases, however, do not address the issue in this case: whether a court's findings of fact and conclusions of law at an evidentiary hearing, in connection with a motion to vacate a default judgment, are binding collaterally on the indemnitee of the defendant in a later proceeding brought against the indemnitee. New York cases provide a broader articulation of the factors to consider in determining whether Defendants had a full and fair opportunity to litigate the issues than the federal cases relied on in the previous decision provide. Compare Marvel Characters, Inc. v. Simon, 310 F.3d at 286 (declining to examine whether there was a full and fair opportunity to litigate, because issue found in previous litigation did not have a preclusive effect) and Schreiber, 327 F.3d at 185 (holding (hat there is privity between party in previous suit and party in current suit when party to previous suit acts as fiduciary of party to the second suit or party to second suit exercises some degree of control over presentation of party's case at the first suit) with Schwartz v. Public Administrator of (he County of the Bronx, 24 N.Y, 2d 65, 72, 298 N.Y.S.2d 955, 961 (1969) (listing factors for court to consider in determining whether parties had a full and fair opportunity to litigate an issue in a previous suit) and Curry v. City of Syracuse, 316 F.3d 324, 332 (2d Cir. 2003) (applying state Page 8 law on collateral estoppel and citing factors listed in Schwartz as necessary to consider in determining whether collateral estoppel applies). But see Pompano-Windy City Partners, Ltd. v. Bear, Steams & Co., 1993 WL 42786 at * 8 (S.D.N.Y. Feb. 17, 1993) (applying federal law to determine whether collateral estoppel applies and listing factors of Restatement (Second) Judgments § 29 (1981) in considering whether there was a fall and fair opportunity to litigate). The motion for reconsideration is granted so that the Court may evaluate the issue in light of New York State law involving collateral estoppel rather than depending on Marvel Characters and Schreiber.

  B. Collateral Estoppel

  Plaintiff is not asserting collateral estoppel based upon the default judgment against the Semeraro Defendants. Rather, collateral estoppel is being asserted based solely on Judge Kaplan's finding of personal jurisdiction in his decisions of September 8, 2000 and December 6, 2001. Pursuant to New York's long arm statute, CPLR § 302, Judge Kaplan found that the Semeraro Defendants committed a tortious act within the state of New York. In order to make his findings, Judge Kaplan developed his own record:

And it is essential to define the record on which that question [whether Sermeraro is subject to New York's long arm jurisdiction] must be decided, as it differs in important respects from that which was before the Magistrate Judge. . . . Accordingly, the record that controls determination of the jurisdictional issue is that of the evidentiary hearing on the motion rather than the inquest that followed the default although it is important also to recognize that parts of the inquest record were received into evidence at the hearing.*fn2
Mario Valente, 115 F. Supp.2d at 373-74. Page 9

  In cases like this, where plaintiff seeks to make offensive use of collateral estoppel, the approach of the Supreme Court is `to grant trial courts broad discretion to determine when it should be applied." Parklane Hosiery Co. v. Shore, 99 S.Ct. 645, 651 (1979). In diversity cases, the situation here, the Court should look to state law in making determinations of collateral estoppel. Semtek Int'l Inc., 531 U.S. at 508-09. "Collateral estoppel is a doctrine based on general notions of fairness involving practical inquiry into the realities of the litigation; it should never be rigidly or mechanically applied." Matter of Halyalkar v. Board of Regents of State of New York, 72 N.Y, 2d 261, 268-69 (1986) (citation omitted); see also In Re Barton, 272 B.R. 61, 64 (N.D.N.Y. 2002) (citing Halyalkar when applying New York laws of collateral estoppel in federal court). In Gilberg v. Barbieri, the Court of Appeals summarized the evolution of New York's law on collateral estoppel as follows:

Until recently the prior determination generally could not even be used against a party to the prior suit unless his current opponent had also been a party who would have been mutually bound by the determination had it been unfavorable to him (see Siegel, New York Practice, § 460). In 1967, however, we held that mutuality of estoppel `is a dead letter' in this State (B.R. De Witt. Inc. v. Hall, 19 N.Y.2d 141, 147, 278 N.Y.S, 2d 596, 225 N.E.2d 195 (1967)) and subsequently in Schwartz, 24 N.Y.2d at 71, indicated that `New York law has now reached the point where there are but two necessary requirements for the invocation of collateral estoppel. There must be an identity of issue which has necessarily been decided in the prior action and is decisive of the present action, and, second, there must have been a full and fair opportunity to contest the decision now said to be controlling' (but, also, see People v. Berkowitz, 50 N.Y, 2d 333, 344, 428 N.Y.S.2d 927, 406 N.E.2d 783 (1980), preserving the mutuality concept in criminal cases).
Gilberg v. Barbieri, 53 N.Y.2d 285, 291 (1981).

  Under New York State law, each party bears the burden of proving one of the "requirements for the invocation of collateral estoppel" described in Gilberg. Id. First, the party Page 10 who is asserting collateral estoppel, in this case Plaintiff, has the burden of demonstrating that the issues in the present litigation are identical to the issues of the prior determination, and that determining those issues was decisive to the outcome of the previous proceeding and to the determination to be made in the present proceeding. Kaufman v. Eli Lilly and Co., 65 N.Y.2d 449, 455-56, 492 N.Y.S.2d 584, 588 (1985); see also Lennon v. Seaman, 2002 WL 109525 at *3 (S.D.N.Y. Jan. 28, 2002) (quoting Kaufman in applying New York laws of collateral estoppel); Juan C. v. Cortines, 89 N.Y.2d 659, 667, 657 N.Y.S.2d 581, 585-86 (1997); Ryan v. New York Telephone Company, 62 N.Y.2d 494, 500-01, 478 N.Y.S, 2d 823, 827 (1984); Leonia Bank v. Kouri, 772 N.Y.S, 2d 251 (App. Div. 2004). Second, "the party attempting to defeat [the application of collateral estoppel] has the burden of establishing the absence of a full and fair opportunity to litigate the issue in the prior action." Kaufman, 65 N.Y.2d at 456, 492 N.Y.S.2d at 588. 1. The issues in the prior proceedings were identical to the current issues and decisive.

  In order to prove identicality of issues, Plaintiff bears the burden of demonstrating that each of the elements of the tort of Unfair Competition pursuant to the Lanham Act was satisfied by the findings of Judge Kaplan in support of his decision determining (hat New York did have personal jurisdiction over the Semeraro Defendants. Section 43 of the Lanham Act states that "[a]ny person who, on or in connection with any goods or services . . . uses in commerce" a "false or misleading description of fact" or a "false or misleading representation of fact" that is "likely to . . . deceive as to the affiliation . . . of such person with another person, or as to the . . . sponsorship . . . of his or her goods . . . or commercial activities by another person" is liable under the act. 15 U.S.C. § 1125(a)(1)(A). Page 11

  In its opinion of September 8, 2003, the Court found that Judge Kaplan's findings established that Defendants violated the Lanham Act. Mario Valente Collezioni, Ltd., 280 F. Supp.2d at 255-56. Defendants do not contest this in their Motion for Reconsideration. Rather, they assert, "Judge Kaplan's findings that Kindler's conduct with respect to Bloomingale's and Lord & Taylor was tortious was not necessary to the determination of . . . whether the court had personal jurisdiction over the Semeraro Defendants." (Mem. Supp. Defs.' Mot. Reconsideration of Opinion & Order Dated Sept. 8, 2003 at 11.)

  The Plaintiff must demonstrate the determination of the issue of Kindler's conduct with respect to Bloomingale's and Lord & Taylor was necessary to the finding of jurisdiction. Kaufman, 65 N.Y.2d at 456, 492 N.Y.S.2d at 588. "[T]he issue must have been material to the first action or proceeding and essential to the decision rendered therein." Ryan, 478 N.Y.S.2d at 826 (citing Silberstein v. Silberstein, 218 N.Y. 525, 528, 113 N.E. 495 (1916); Hinchey v. Sellers, 197 N.Y.S.2d 129 (1959); Ripley v. Storer, 309 N.Y. 506, 517 (1956); Ward v. Boyce, 152 N.Y. 191 (1897)). "Additionally, the issue that was raised previously must be `decisive of the present action.'" LaFleur v. Whitman, 300 F.3d 256, 271 (2d Cir. 2002) (quoting Schwartz 24 N.Y.2d at 7l).*fn3

  As explained above, in finding that Defendants committed the tortious act of unfair competition, Judge Kaplan also found the elements of the Lanham act were fulfilled. After hearing the testimony of Semeraro and Kindler, Judge Kaplan also found that Kindler and Semeraro, "together hatched a scheme to dump plaintiff as the U.S. distributor of Semeraro's Page 12 products." Mario Valente Collezioni Ltd., 115 F. Supp.2d at 376. Judge Kaplan concludes "There is little doubt that the actions of Semeraro and Kindler were tortious," and in supporting this statement he adds, "by virtue of the agency relationship between Semeraro and Kindler, Kindler's actions within New York subject Semeraro to jurisdiction under [Newark's long arm statute]/" Id. at 376-77. Finding that Kindler committed a tort in New York State was decisive in Judge Kaplan's finding of personal jurisdiction over the Semeraro Defendants.*fn4 This Court's prior opinion demonstrated that Judge Kaplan found in Plaintiff's favor each element decisive to a determination that Defendants violated the Lanham Act.

  2. Full and fair opportunity to litigate

  The Defendants must demonstrate that they lacked a "foil and fair opportunity" to litigate the issue. Schwartz, 24 N.Y.2d at 71. A "foil and fair opportunity" requires identity of parties or "privity" of parties, and "a practical inquiry into `the realities of the [previous] litigation.'" Gilberg v. Barbieri, 53 N.Y.2d at 292 (quoting Schwartz, 24 N.Y.2d at 72).

  In their opposition papers to Plaintiff's motion for summary judgment, Defendants assert that their interests were not adequately represented in the litigation leading up to the default judgment by Magistrate Judge Eaton. (Defs.' Reply Mem. Supp. Defs.' Mot. Summ. J. and Mem. Opp'n Pl.'s Cross-Mot. Summ. J. at 20-21.) The relevant proceeding, however, is not the default judgment before Magistrate Eaton, but the jurisdictional hearing before Judge Kaplan. Page 13

  Defendants were not a party to the proceeding before Judge Kaplan, but (hey were in privity with the Semeraro Defendants. If the party against whom estoppel is being asserted was not a party to the previous case, he must have been in privity with a party in the first case in order for collateral estoppel to apply. Gilberg, 53 N.Y, 2d at 291 (citing Postal Tel. Cable Co. v. Newport, 247 U.S. 464, 38 So. Ct. 566 and Provident Bank v. Patterson, 390 U.S. 102, 88 So. Ct. 733.) "In the context of collateral estoppel, privity does not have a single well-defined meaning. Rather, privity is `an amorphous concept not easy of application"' Buechel v. Bain, 97 N.Y.2d 295, 304, 740 N.Y.S.2d 252, 258 (2001) (citing Matter of Juan C. v. Cortines, 89 N.Y.2d 659, 667 (NY 1997)). The Supreme Court has stated, "We have recognized an exception to the general rule [of identically of parties] when, in certain limited circumstances, a person although not a party, has his interests adequately represented by someone with the same interests who is a party." Richards v. Jefferson County. Alabama, 517 U.S. 793, 798, 116 S.Ct. 1761, 1766 (1996) (quoting Martin v. Wilks, 490 U.S. 755, 762 n.2, 109 S.Ct. 2180, 2184 n.2 (1989)). New York courts have expanded the definition of privity:

We think the better rule, however, and that which is actually applied in this State as well as in a number of other jurisdictions, eschews strict reliance on formal representative relationships in favor of a more flexible consideration of whether all of the facts and circumstances of the party's and nonparty's actual relationship, their mutuality of interests and the manner in which the nonparty's interests were represented in the prior litigation establishes a functional representation such that "the nonparty may be thought to have had a vicarious day in court' (Note, Collateral Estoppel of Nonparties, 87 Harv.L.Rev. 1485, 1499-1500 [1974]).
Slocum on Behalf of Nathan A v. Joseph B, 588 N.Y.S.2d 930, 931 (App. Div. 1992) (quoted in Cowan v. Ernest Codelia, P.C., 2001 WL 856606 at * 8 (S.D.N.Y. July 30, 2001)).*fn5 Page 14 Under New York law an indemnitor/indemnitee relationship establishes privity for the purposes of collateral estoppel Hinchey v. Sellers, 7 N.Y, 2d at 295 (allowing insured/indemnitee to use facts found in case against insurer/indemnitor defensively in subsequent case brought by same plaintiff). Usually collateral estoppel is used defensively by the indemnitor after an indemnitee has been found not-liable. Here, though, collateral estoppel is being exerted against an indemnitee after an indemnitor has been found liable. Defendants cite Herbert Rosenthal Jewelry Corp. v. Zale Corp., 323 F. Supp. 1234 (S.D.N.Y. 1971), for the first time in their motion for reconsideration, for the following proposition: "this Court has specifically held that being an indemnitee does not bind a litigant to determinations on claims litigated successfully against its indemnitor." (Defs.' Mot. Recons. of Op. & Order Dated Sept. 8, 2003 at 7-8.) In Zale, a 1971 case, the Court declined to find privity between an indemnitee and an indemnitor when the indemnitor was sued first and found liable. However, the Court applied federal law to the issue and rested its decision in part on the fact that the second defendant was not involved "in any manner" with the previous lawsuit. Zale, 323 F. Supp. at 1237. Here, on the other hand, the Court applies subsequent New York law and the indemnified Defendant testified at the jurisdictional hearing before Judge Kaplan.

  Three factors taken in conjunction make this case unique and lead the Court to find privity between Defendants and the Semeraro Defendants. First, as Judge Kaplan found, there is a close relationship between the Defendants and the Semeraro Defendants. Mario Valente Collezioni, 115 F. Supp.2d at 376 (finding "Semeraro and Kindler had a community of interest in violating plaintiff's exclusive rights to Sermeraro's production and in persuading plaintiff's Page 15 customers that Kindler, and not plaintiff, was the only available source of those goods . . . Semeraro is legally responsible for all actions by Kindler and his agents in furtherance of the plan.") Also, the Semeraro Defendants indemnified Kindler for the testimony he gave at the hearing to determine whether jurisdiction existed in New York and they are also indemnifying him in this action. (See Letter from Rondos to Kindler of 6/1/00; Indemnification Agreement dated 6/8/02 submitted to Court by Defs. via letter of 1/15/04.) Additionally, Defendants have admitted that Kindler was acting as the agent of the Semeraro Defendants: "Kindler was acting at the indemnitors' request when he attempted to sell coats to Lord & Taylor and Bloomingdale's." (Letter from Martin B. Pavane, Esq. to Judge Patterson of 1/15/04 at 2.)

  Second, in the prior case, the Semeraro Defendants had the same interests as the Defendants and Defendants have presented no evidence that those interests were not represented adequately. See Richards, 517 U.S. at 798.*fn6 Judge Kaplan's findings were based on the actions of Kindler and AAK. Semeraro had every incentive in the proceedings before Judge Kaplan to litigate as vigorously as possible the position that Kindler did not interfere with the business relationship of Plaintiff with Bloomingdale's and Lord & Taylor. Semeraro himself testified at the hearing. Had the Semeraro Defendants and Kindler convinced Kaplan that AAK's and Kindler's actions did not constitute tortious acts on behalf of the Semeraro Defendants, Judge Page 16 Kaplan would not have found jurisdiction and the Semeraro Defendants would not have been liable to Plaintiff.

  Third, a concern in granting privity (and thus collateral estoppel effect) between an indemnitor and indemnitee in a situation where the plaintiff has already succeeded in a claim against the indemnitor is that the plaintiff would recover twice for the same injury. 18A Charles Alan Wright, et al., Federal Practice and Procedure § 4463 (2d ed. 2002). Here, however, Plaintiff has not recovered any damages awarded to them in the previous judgment, and Defendants' indemnification agreement assures them of a way to recover from the Semeraro Defendants. Given the unique facts of this case, the Court finds privity between the Semeraro Defendants and Defendants.

  In applying New York State law of collateral estoppel, the Second Circuit has stated:

In determining whether a party had a full and fair opportunity to litigate the issue, the New York Court of Appeals has instructed that `the various elements which make up the realities of litigation,' should be explored, including `the size of the claim, the forum of the prior litigation, the use of initiative, the extent of the litigation, the competence and experience of counsel, the availability of new evidence, indications of a compromise verdict, differences in applicable law and foreseeability of future litigation.'
Curry, 316 F.3d at 332 (quoting Kosakow v. New Rochelle Radiology Assoc., P.C., 274 F.3d 706, 734 (2d Cir. 2001) (quoting Schwartz, 24 N.Y, 2d at 72, 298 N.Y.S, 2d at 961)). See also Restatement (second) of Judgments § 29 (1981) (listing other factors to consider). Applying these factors, the Court finds Defendants did have a full and fair opportunity to litigate in the previous proceeding. The forum in both the previous and current cases is the Southern District of New York. With over one month's notice of the nature of the litigation, Kindler testified at the prior proceeding. At the time, he did not choose to request his own attorney, apparently Page 17 satisfied with the hold harmless agreement. Kindler "had a full opportunity to tell his story at the first trial in order to remove himself from liability or to cast it elsewhere." Schwartz, 24 N.Y.2d 65, 72. Defendants have made no showing of lack of competence or expertise of the counsel to the Semeraro Defendants when they were litigating the issue of personal jurisdiction. Defendants have made no showing of new evidence. The applicable law is the same in both cases. Finally, it is clear that future litigation was foreseeable to the Defendants, because Kindler obtained a "hold harmless" agreement before testifying for the Semeraro Defendants at the jurisdictional hearing.


  Upon reconsideration, the Court finds that collateral estoppel precludes the parties from litigating whether Defendants committed unfair competition, and that accordingly the extensive discovery requested by Defendants is unnecessary The issue of damages remains to be determined.


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