Jill G. Okun (admitted pro hac vice) PORTER WRIGHT MORRIS ARTHUR LLP 950 Main Avenue, Suite 500 Cleveland, Ohio 44113-7206 Telephone: (21 6) 443 -2508 jokun@porterwright.com Brian M. McQuaid SQUIRE PATTON BOGGS (US) LLP 1 East Washington Street, Suite 2700 Phoenix, Arizona 85004 Telephone: (602) 528-4000 brianmcguaid@sguiresanders.com James M. Brogan (admitted pro hac vice) DLA Piper LLP (US) One Liberty Place 1650 Market Street, Suite 4900 Philadelphia, 19103 Telephone: (215) 656-3300 James.Brogan@dlapiper.com Attorneys for The Goodyear Tire Rubber Company and Deborah A. Okey l\ 01 but!? Electronlcally Filed T. Hays, Deputy 1/9/2017 4:47:00 PM Filing ID 8004635 IN THE SUPERIOR COURT OF THE STATE OF ARIZONA IN AND FOR THE COUNTY OF MARICOPA ESTATE OF LEROY DONNA HAEGER, individually and as personal representative of the Estate of LeRoy Haeger; BARRY HAEGER and SUZANNE HAEGER, Plaintiffs, v. GOODYEAR TIRE AND RUBBER COMPANY, an Ohio corporation; FENNEMORE CRAIG, P.C., an Arizona professional corporation; ROETZEL ANDRESS, a legal professional association; GRAEME BASIL DEBORAH OKEY, Defendants. Case No. CV2013-052753 THE GOODYEAR TIRE RUBBER COMPANY AND DEBORAH OPPOSITION TO MOTIONS FOR SUMMARY JUDGMENT REGARDING LIMITED ISSUE PRECLUSION (Assigned to the Honorable John R. Hannah, Jr.) [Oral Argument Requested] I. INTRODUCTION The Court has now twice considered and denied plaintiffs? efforts to apply collateral estoppel to this case, and plaintiffs raise nothing new to undermine those decisions in its second do-over. Indeed, while plaintiffs now assert this case is in ?a substantially different posture? because ?the parties have engaged in full and vigorous discovery on each claim,? such change in posture con?rms the propriety of this Court?s prior rulings. That the defendants have now had the opportunity to conduct ?full and vigorous discovery,? which allows them to defend themselves, underscores how the sanctions proceeding did not constitute a full and fair opportunity to litigate the claims in this case.1 11. RELEVANT FACTUAL BACKGROUND -A. The District Court?s Sanctions Proceedings. On May 31, 2011, a year after Haeger I was closed, plaintiffs ?led a motion for sanctions against Goodyear, premised on disclosure of ?internal heat tests? in Schalmo. GYSOF 11128. Goodyear ?led its opposition on July 15, 2011. GYCSOF 1] 33. The district court ordered Goodyear to produce the ?tests at issue,? and nearly two weeks later plaintiffs ?led a reply brief. GYCSOF 34-35, 129. Based solely on this minimal brie?ng and document disclosure?and no evidentiary hearing?on February 24, 2012, the district court issued a proposed order determining that Goodyear had a ?deliberate corporate strategy . . . to prevent the disclosure of the internal heat test results.? GYSOF 129-30. Without discovery or a hearing, the district court was unaware that the heat rise tests had been disclosed in four G159 cases (Schalmo, Woods, Martin, and Moore). GYSOF 1] 141. The district court also accused Goodyear engineer Richard Olsen, without an evidentiary record, of providing false testimony in a Rule 30(b)(6) deposition. GYSOF 11131. The district court?s proposed order established that the court was going to impose sanctions and merely sought brie?ng by Goodyear, Musnu??, and Hancock to determine the amount and allocation of I See, for example, defendants? summary judgment motions, relying on evidence and deposition testimony of plaintiffs, not available during the district court proceedings. 00 \l 0\ til 4} DIN sanctions. GYSOF 1] 132. It gave Goodyear and its outside counsel four days to ?le a response to the proposed order, which it later brie?y extended on the motion of Musnuff and Hancock. GYCSOF 1] 36. The district court also set a hearing, which was extended to March 22. GYCSOF 1]3 7. The district court then imposed a highly accelerated brie?ng deadline, leaving Goodyear with three days 'or less to respond to plaintiffs? accusations and the district court?s sua sponte inquiries. GYCSOF 1]1] 38-43. After receiving this brie?ng, the district court issued an order the day before the March 22 evidentiary hearing castigating Goodyear?s and its outside counsel?s attempts to defend themselves on the merits. The district court accused Goodyear and its counsel of ?remain[ing] committed to advocating seemingly untenable positions? and ?[a]ttempting to justify the unjusti?able,? and stated that they plan on continuing to defend their actions on the merits, [they] should be prepared to present substantially more compelling justi?cations than those they have proffered to date.? GYCSOF 1]1] 44-45. The day after accusing Goodyear and its counsel of acting in an ?untenable? and ?tmjusti?able? manner, the district court held a limited evidentiary hearing, where Goodyear?s outside counsel con?rmed that Goodyear did not, ?in words or in substance,? direct concealment or withholding of the heat rise tests, or any documentation. GYSOF 1] 140. NCC further con?rmed that the heat rise tests were produced in four other G159 cases. GYSOF 1] 141. At the end of the hearing, the district court required Goodyear to produce all ?written exchanges associated with the drafts of [Goodyear?s discovery] responses and the production of test data that primarily runs between Mr. Musnuff, Ms. Okey, [and] the Goodyear engineers.? GYCSOF 1] 46. It also permitted plaintiffs to depose two Goodyear witnesses. GYCSOF 1] 46. After this unilateral discovery completed, the district court ordered simultaneous brie?ng. GYCSOF 1] 49. On November 8, 2012, the district court af?rmed its proposed order and formally granted plaintiffs? motion for sanctions. GYSOF 1] 148. Relying on a deferential abuse of discretion standard, the Ninth Circuit affirmed the sanctions ruling; the amount of sanctions is currently pending before the US. Supreme Court. GYSOF 1] 150. B. Plaintiffs? First Motion For Collateral Estoppel. On July 28, 2015, plaintiffs asked this Court to collaterally estOp ?Defendants? from denying or re-litigating alleged ?ndings of fraud and abuse of process in the district court?s sanctions order. During the September 10, 2015 hearing, this Court denied plaintiffs? motion for three primary reasons. First, the issues in Haeger I were not the same as this case?the Haeger I sanctions proceeding involved ?ndings of bad faith, whereas fraud and abuse of process are decidedly different, with different elements requiring demonstration of completely different actions and intent. GYCSOF 1] 50. . Second, defendants were not provided a ?full and fair opportunity? to litigate the issues in the sanctions proceeding. Although the Court recognized the procedures and due process that the district court afforded the litigants in Haeger I, it ?reject[ed] the idea that if it was due process in the other case . . . then it?s good enough here,? among other things because in Haeger I, ?[t]here wasn?t a complaint, so there wasn?t notice. . . . There wasn?t discovery. There wasn?t a full opportunity to cross-examine witnesses.? GYCSOF 111] 51-52. Indeed, this Court clearly recognized that due process for imposition of sanctions does not equate to due process for plaintiffs? claims here, where defendants are entitled to the full panoply of procedures provided by the civil rules. GYCSOF 1} 53 isn?t [counsel for Goodyear and Okey] right when she says due process for purposes of compensatory sanction, that?s not dispositive here. That doesn?t necessarily mean a full and fair opportunity to litigate for this proceeding, does The Court noted it was especially opposed to applying collateral estoppel to Okey, who was neither sanctioned nor represented by counsel in the sanctions proceedings. GYCSOF 1] 54. Finally, the Court noted that the district court?s ?ndings were not essential to its sanctions order. That is, the district court ?could have reached that judgment without ever making any one of those ?ndings.? GYCSOF 11 55. C. Plaintiffs? Second Motion For Collateral Estoppel. On October 23, 2015, plaintiffs asked the Court to reconsider its prior, well-reasoned decision. Though claiming a request for only ?limited? reconsideration, plaintiffs in reality sought to preclude defendants from offering any defense on the merits to plaintiffs? claims. Plaintiffs initially sought to apply collateral estoppel to both Goodyear and Okey, but explicitly withdrew their arguments as to Okey at the hearing. GYCSOF 1] 56. Plaintiffs argued that the district court necessarily relied on all of defendants? allegedly willful acts to impose sanctions, and thus every factual ?nding was ?essential to its judgment.? Pls. 10/23/15 Mot. for Reconsideration at 4; GYCSOF 11 61. They also argued that Goodyear received substantial due process based on multiple rounds of brie?ng, depositions, thousands of pages of newly-disclosed documents, and a-full day evidentiary hearing. Pls. 10/23/ 15 Mot. at 5-8; GYCSOF 1] 58. Finally, plaintiffs argued that the abuse of process claim was ?identical? to the district court?s ?ndings. Pls. 10/23/15 Mot. at 11-13; GYCSOF 1] 59. In support of their Motion, plaintiffs provided a chart of ??ndings? by the district court (the ?Chart?) and argued that, at a minimum, the Court should give collateral estoppel effect to each of those ?ndings. GYCSOF 1 57. During a February 10, 2016 hearing on plaintiffs? motion, when the Court expressed concern that plaintiffs were requiring it to go through a ?hunt and peck exercise? in determining which speci?c ?ndings may be subject to collateral estoppel, plaintiffs speci?cally referenced this chart as the ?ndings the Court should collaterally estop defendants from contesting. GYCSOF 11 60. Despite plaintiffs? arguments and their speci?c enumeration of proposed ??ndings? to be established through collateral estoppel, this Court denied plaintiffs? motion. GYCSOF 1162. The Court did, however, indicate that it might be willing toentertain a subsequent motion regarding the preclusive effect of the district court?s ?ndings as to what the discovery rules required in Haeger I. GYCSOF 1163. What this Court left open is not what plaintiffs seek here.2 The subject motion is merely another attempt to reargue what this Court has twice rejected. LAW AND ANALYSIS Plaintiffs? legal arguments are substantively identical to their previous assertions. Further, 2 That issue is covered in a separate motion. See Goodyear and Okey?s Brief in Opposition to Plaintiffs? Motion for Partial Summary Judgment Re Questions of Federal Law. 4 plaintiffs? 34 proposed ??ndings? in the current Motion were already identi?ed in the Chart appended to plaintiffs? last motion for reconsideration?and in most cases the instant Motion and the Chart use identical language.3 They offer no new justi?cations for this Court to reconsider its prior determinations. Their motion, accordingly, should be denied. i A. The Statute of Limitations Moots Most of Plaintiffs? Motion. In their Motion for Summary Judgment on Abuse of Process, Goodyear and Okey showed that the statute of limitations under A.R.S. ?12~542 bars all of plaintiffs? abuse of process claim aside from any alleged abuses of process that may have occurred after May 20, 2011. Goodyear and Okey further established that the only two post-May 20, 2011 actions that plaintiffs seem to rely on?allegedly false statements in declarations ?led by Okey and Richard Olsen?have no cognizable damages, nor merit. Because plaintiffs? abuse of process claim is not tenable, the Court should deny their motion to apply collateral estoppel as moot. N. Natural Gas Co. v. Nash Oil Gas, Inc, 526 F.3d 626, 631 (10th Cir. 2008) judgment on these claims was appropriate based on the statute of limitations, and we need not address the district court?s alternative reasoning premised on collateral Koch v. Christie?s Int ?1 PLC, 785 F. Supp. 2d 105, 118 n.6 (S.D.N.Y. 2011) (?Because the Court decides Plaintiff?s RICO claims, as well as his common law fraud claims, on statute of limitations grounds, the Court need not reach the causation and collateral estoppels [sic] arguments raised by Defendants?). 3 Proposed Finding #1 is found on Chart p.4, cite 977-78Chart p.2, cite 965 and p.4, cite 976; PF 4 is on Chart p.l, cite 947; PF 5 is Chart p.5, cite 979; PF 6 is Chart p.1, cite 948; PF 7 is Chart p.1, cite 958; PF 8 is Chart p.2, cite 958; PF 9 is Chart p.2, cite 960; PF 10 is Chart p.2, cite 965; PF 11 is Chart p.1, cite 958; PF 13 is Chart p.3, cite 969; PF 14 is Chart p.4, cite 977-78; PF 16 is Chart p.3, cite 966; PF 17 is Chart p.3, cite 970; PF 18-22 are Chart pp.4-5, cite 977-78; PF 23-24 are Chart p.5, cite 979; PF 26 is Chart p.1, cite 947; PP 27-28 are Chart p.5, cite 979; PF 29-33 are Chart p.6, cite 980; and PF 34 is Chart p.6, cite 981. PF 25 has no citation to the district court?s opinion, and page 979 of the district court?s opinion (which is cited in PF 24 and 26) does not contain a similar ?nding. PF 12 is implicit in Chart p.3, cite 969, but plaintiff?s language is substantially more precise in this Motion compared to the Chart. PF 15 is partially in Chart p.3, cite 966. See generally GYCSOF 1157. p?A B. Plaintiffs Have Not Established That Collateral Estoppel is Appropriate. It is plaintiffs? burden to establish each of the elements of offensive collateral estoppel. Kendall v. Visa U.S.A., Inc., 518 F.3d 1042, 1050-51 (9th Cir. 2008). Plaintiffs must prove that: (1) there was a full and fair opportunity to litigate the identical issue in the prior action; (2) the issue was actually and necessarily litigated in the prior action; (3) the issue was decided in a ?nal judgment; and (4) the party against whom issue preclusion is asserted was a party or in privity with a party to the prior action. Skilstaf, Inc. v. VS Caremark Corp, 69 F.3d 1005, 1021 (9th Cir. 2012); Syverson v. IBM, 472 F.3d 1072, 1078 (9th Cir. 2007); Kourtis v. Cameron, 419 F.3d 989, 994 (9th Cir. 2005).4 Despite this Court?s recognition on two previous occasions that collateral estoppel is inappropriate under the facts and circumstances of this case, plaintiffs choose again to burden the Court and defendants with this issue, hoping for a different result.5 Very plainly, for purposes of collateral estoppel, plaintiffs have not demonstrated that Goodyear and Okey had a full and fair opportunity to litigate the matter; (2) the ?ndings plaintiffs identify were necessary to the merits of the decision; (3) that the issues presented in Haeger I were identical to plaintiffs? abuse of process claim here; or (4) that Okey was a party to the prior action. Their summary judgment motion accordingly should be denied. 1. Goodyear and Okey did not have a full and fair opportunity to defend in the Haeger I sanctions proceeding, as this Court previously found. Plaintiffs argue that the purportedly ?extensive? procedures the district court followed before imposing inherent authority sanctions mean that Goodyear and Okey necessarily had a ?full and fair opportunity? within the meaning of their due process rights to defend in the Haeger I sanctions 4 Federal law dictates the preclusive effect of a federal court judgment in state court. In re General Adjudication of All Rights to Use Water in the Gila River System Source, 212 Ariz. 64, 69, 127 P.3d 882, 887 (2006) (citing Semtek Int ?1 Inc. v. Lockheed Martin Corp, 531 U.S. 497, 507 (2001)). The application of collateral estoppel is a question of law for the court to determine. Resolution Trust Corp. v. Keating, 186 F.3d 1110, 1114 (9th Cir. 1999). 5 While plaintiffs concede that this is their third direct request for application of collateral estoppel, they fail to denominate their motion as seeking reconsideration. Although Rule 7.1(e) does not require a response, unless sought by the Court, Goodyear ?les its response in an abundance of caution. . proceeding. See Pls. Mot. at 10. And plaintiffs go on to ?describe[e] in detail? those proceedings. Pls. Mot. at 14-15. Plaintiffs, however, have already made this same plea to this Court. See GYCSOF 111] 52-53, 58. And this Court has considered the argument and correctly rejected the notion ?that if it was due process in the other case it?s due process [and] it?s good enough here.? GYSOF 52. Plaintiffs? claims here are decidedly different from the sanctions proceeding. The procedures guaranteed to a defendantin cases of fraud and abuse of process provide for complaint, answer, two-sided and full discovery, motions, a jury trial and more. None of these occurred before the district court, demonstrating that what was deemed appropriate before the district court is plainly insuf?cient here. As this Court observed, even granting that the district court was trying to be fair and thorough, the process she used is not set forth in any rules, and appeared to be ?kind of ma[de] up . . . as she [went] along.? GYCSOF 1] 52. There was no complaint or any formal discovery. GYCSOF 11 52?. Tothe contrary, the discovery in the Haeger I sanctions proceeding was entirely unilateral in plaintiffs? favor, as opposed to the substantial bilateral discovery that has occurred in this case. GYCSOF 11 48. Haeger I did not provide Goodyear with a ?ll] opportunity to cross-examine witnesses?in fact, many witnesses on which Goodyear and Okey rely in this case to (such as the Haegers) did not participate in the sanctions proceedings. See generally Goodyear?s and Okey?s Motion for Summary Judgment on Fraud and Derivative Claims. Nor did any expert witnesses testify where, as here, Goodyear and Okey have retained such witnesses. GYCSOF 1} 22. The denial of collateral estoppel where the full range of litigation procedures is absent is not limited to situations like this but is the general rule where a party is denied procedural opportunities. Courts are reluctant to apply offensive collateral estoppel where ?the defendant might be afforded procedural opportunities in the later action that were unavailable in the ?rst and that could readily cause a different result.? Sha?er v. R.J. Reynolds Tobacco Corp, 860 F. Supp. 2d 991, 995 (D. Ariz. 2012) (quoting Syverson, 472 F.3d at 1078-79); see also id. at 998; Tucson v. Super. Ct., 161 Ariz. 442, 445-46 (App. 1989) (noting that application of issue preclusion for good faith settlement determination would unfairly deprive the litigant of a constitutional jury trial right). Issue preclusion is not likely to apply ?if there is reason to doubt the quality, extensiveness, or fairness of procedures followed in prior litigation.? Montana v. United States, 440 US. 147, 164 (1979). ?Any reasonable doubt as to what was decided by a prior judgment should be resolved against allowing the collateral estoppel effect.? In re Kelly, 182 BR. 255, 258 (Bankr. 9th Cir. 1995). As this Court acknowledged, the district court?s sanctions procedures are especially inadequate to impose collateral estoppel on Okey. Okey was not sanctioned in the proceeding, represented by counsel, or given notice of a potential sanctions claim against her. GYCSOF 1} 54. Indeed, even plaintiffs have previously recognized that applying collateral estoppel to Okey would be inappropriate. GYCSOF 1] 56. 2. On point case law supports this Court?s previous rulings. This Court?s conclusion was and remains correct. Despite the Court?s inquiry in a prior hearing, plaintiffs have not identi?ed any authority imposing collateral estoppel on an abuse of process claim based upon a prior inherent authority sanction. GYCSOF {[64 Goodyear and Okey have not located such a case either, showing that plaintiffs are asking this Court to go where apparently no court has gone before. Moreover, other courts have expressly held that analogous Rule 11 sanctions proceedings do not constitute full and fair opportunity to litigate and must not be afforded preclusive effect.6 Amwest Mortg. Corp. v. Grady, 925 F.2d 1162, 1164-65 (9th Cir. 1991) (denying application of collateral estoppel because the ?Rule 11 hearing is much narrower than a ?ll] civil proceeding in state court?); Faigin v. Kelly, 184 F.3d 67, 79 (lst Cir. 1999) are legitimate questions as to whether a Rule 11 sanctions order can provide a satisfactory basis for issue preclusion under any circumstances in respect to the merits of a complaint?); Klayman v. Barmak, 602 F. Supp. 2d 110, 117-18 (D.D.C. 2009) (?It would be unfair to preclude an issue based on the resolution of a motion for sanctions because 6 Rule 11 cases are the most persuasive for this issue because, like inherent authority sanctions, Rule 11 [requires proof that a party or its counsel acted in bad faith. In re Mortgs. Ltd, 771 F.3d 623, 630 (9th Cir. 2014); PAE Gov?t Servs. v. MPRI, Inc., 514 F.3d 856, 859-60 (9th Cir. 2007) sanctions hearings are procedurally dissimilar to trials. A motion for sanctions does not provide parties an opportunity to litigate fully?-conduct discovery, present and cross-examine witnesses?as required for application of collateral estoppel.? (citations omitted?; Britt v. Ste??en, 220 Ariz. 265, 271 (App. 2008) (?Like the imposition of costs, attomey?s fees, and contempt sanctions, the imposition of a Rule 11 sanction is not a judgment on the merits of an action. Rather, it requires the determination of a collateral issue?). Goodyear has located two post-January 2015 unpublished opinions7 denying collateral estoppel effect to Rule 11 proceedings in a subsequent abuse of process case, although it found no such published opinions. Kegerise v. Susquahana Sch. Dist. No. 1: CV-14-0747, 2015 US. Dist. LEXIS 1160, at *39?41 (M.D. Pa. Jan. 7, 2015) (Rule 11 sanctions did not collaterally estop subsequent wrongful use of civil proceedings action, ?nding that defendant?s argument for issue preclusion was ?too sketchy to accept? based on the absence of any case law supporting application of collateral estoppel) (attached hereto as Exhibit Perelman v. Perelman No. 2015 Pa. Super. LEXIS 709, at *24?32 (Pa. Super. Oct. 27, 2015) (reviewing authorities discussing Rule 11 sanctions and abuse of process or malicious prosecution claims, holding that they ?point in only one direction? against application of collateral estoppel) (attached hereto as Exhibit A). Plaintiffs have cited no legal authority justifying reversal of the prior denial of collateral estoppel. The primary decision they rely on, In re Zelis, 66 F.3d 205 (9th Cir. 1995) concerns collectability of a sanctions judgment in bankruptcy, not whether ?ndings were preclusive in a subsequent action with different claims and different elements. There, the debtor was sanctioned by a state appeals court twice for bringing a frivolous appeal for an ?improper purpose.? Id. at 207-08. Defendant then tried to discharge the sanctions order in a subsequent bankruptcy proceeding under 11 U.S.C. 523(a)(6), which states that debts are not dischargeable if they are incurred for ?willful and 7 Arizona Supreme Court Rule 111(c)(1)(C) and 111(d) permit citation to unpublished decisions of other jurisdictions for persuasive value on issues of Arizona law if authored after January 2015. 00 \l -B U.) r?a malicious injury by the debtor.? Id. at 208. The court held that the sanctioning court?s determination that the debtor?s actions were intentional and abusive with no justi?cation or excuse - which the debtor had the opportunity to fully litigate met the Will?ll and malicious standard and the debtor was bound by collateral estoppel. Id. at 208-09. Zelis is a narrow decision applicable only in bankruptcy? It did not hold that a sanctions ruling is entitled to collateral estoppel in a subsequent civil?claim for abuse of process. Thus, aside from the fact that it is not new legal authority, it is no different than the cases previously cited in plaintiffs? October 23, 2015 Motion for Reconsideration?which this Court found unpersuasive and which defendants distinguished in their Response to Plaintiffs? Motion for Reconsideration at p. 10, fn. 9. Zelis does not show that collateral estoppel is appropriate here.9 Finally, plaintiffs argue again that the Ninth Circuit?s af?rmation of the sanctions order has preclusive effect. Pls. Mot. at 15-16. But plaintiffs cite no authority that the Ninth Circuit?s af?rmance under a deferential abuse of discretion standard cures the lack of a full and fair opportunity to litigate. The decision on which plaintiffs rely, ReadyLink Healthcare, Inc. v. State Compensation Ins. Fund, 754 8 The Zelis court followed the Supreme Court?s directive that a bankruptcy court may ?properly give collateral estOppel effect to these elements of a claim that are identical to the elements required for discharge and which were actually litigated and determined in the prior action.? Grogan v. Garner, 498 US 279, 284-85 n.11 (1991). 9 Plaintiffs? other authorities are similarly distinguishable. See Pls. Mot. at 12 n.6. Like Zelis and many of plaintiffs? previously-cited cases, In re Keaty, 397 F.3d 264, 268, 270-71 (5th Cir. 2005), allowed issue preclusion in bankruptcy discharge context because the issue ?encompass[ed] the same primafacie elements as the bankruptcy issue - and the facts supporting the Court?s ?ndings are discemable from the Court?s records.? Clark v. Bear Stearns Co., Inc., 966 F.2d 1318, 1321-22 (9th Cir. 1992), held that an arbitration decision in defendant?s favor on plaintiff?s common law fraud claims did not preclude plaintiff?s securities (fraud claim against that same defendant because the court could not determine what law the arbitrators applied. Finally, Theofel v. Farey-Jones, 359 F.3d 1066, 1072, 1074 n.1 (9th Cir. 2004), stated in dicta that defendants were precluded from arguing the validity of a subpoena that was relevant to a Stored Communications Act claim because they had previously litigated the validity of the subpoena?and were sanctioned?in a separate miscellaneous action. The non-controlling nature of the dicta aside, the opinion does not specify any procedural aspects of the separate proceeding. heofel also involved a single discrete issue?whether a subpoena was valid and issued in bad faith?in substantial contrast to here, where plaintiffs are seeking collateral estOppel on 34 separate ?ndings, which themselves do not represent the totality of all of the district court?s ?ndings. 10 F.3d 754 (9th Cir. 2014), does not support their position. That case applied issue preclusion to an appellate decision regarding preemption where the appellate court made the ruling in the ?rst instance. As the court noted, ?[p]reemption is almost always a legal question, the resolution of which is rarely aided ?by development of a more complete factual record.?? Id. at 761-62 (citation omitted). To the extent ReadyLink contemplates applying collateral estoppel to an issue ?rst addressed on appeal, it is only for ?purely legal Valenzuela v. Union Pac. R.R. Co., No. CV-15-1092, 2016 U.S. Dist. LEXIS 90098, at *26?27 (D. Ariz. July 11, 2016) (distinguishing ReadyLink and declining to apply collateral estoppel where the case involved ?an important factual issue? and relied heavily on the factual background) (attached hereto as Exhibit In short, this Court has correctly determined, twice, that there was not a full and fair opportunity to litigate the facts underlying plaintiffs? abuse of process claim and the legal elements of the current suit were not decided. Plaintiffs have offered nothing new to undemnne this determination. 3. None of plaintiffs? enumerated ??ndings? was essential to the district court?s order. This Court previously held that although the district court made numerous ?ndings, it ?could have reached that judgment without ever making anyone [sic] of those ?ndings.? GYCSOF {[55 And because ?there is no single ?nding that was essential to [the district court?s] judgment,? issue preclusion does not apply. Id. Plaintiffs provide no reason for this Court to reconsider. Collateral estoppel requires showing that the issues for which preclusion is sought ?were necessary to support the court?s judgment in the ?rst action,? and not ?merely incidental to the judgment in the prior action.? Resolution Trust Corp. v. Keating, 186 F.3d 1110, 1115 (9th Cir. 1999); Sha?er, 860 F. Supp. 2d at 998 (declining to apply offensive collateral estoppel when the plaintiff failed to speci?cally show how the ?ndings at issue were necessary to the judgment); Grisham v. Phillip Morris, Inc., 670 F. Supp. 2d 1014, 1032 (CD. Cal. '0 Plaintiffs selectively quote Valenzuela but do not acknowledge its holding or its analysis distinguishing ReadyLink. Pls. Mot. at 16. ll 2009) (same). ?The Ninth Circuit requires that plaintiff, not the Court, undertake this analysis? and where the plaintiff fails to do so, the court cannot deem the ?ndings to be conclusively established." Grisham, 670 F. Supp. 2d at 1032. ?Any reasonable doubt as to what was decided by a prior judgment should be resolved against allowing the collateral estoppel effect.? Kelly, 182 BR. at 258. Plaintiffs rehash their old argument that every ?nding was essential to the district court?s ruling. Pls. 10/23/2015 Mot. for Reconsideration at 10-11; GYSOF 61. Aside from this Court?s rejection of this position, plaintiffs? mantra that all ?ndings were ?obviously necessary,? Pls. Mot. at 17, is legally insuf?cient. Plaintiffs cannot rely on a blanket assertion of necessity, but rather must show that each individual ?nding was necessary to the imposition of sanctions. Plaintiffs fail to even attempt this task, nor do they cite any legal authority that such a shortcut is permissible. Sha?er, 860 F. Supp. 2d at 997- 98 (refusing to apply collateral estoppel where plaintiff failed to show that the numerous ?ndings of fact at issue ?were necessary to the judgment,? and citing authorities stating similar holdings); Bldg. Mat ?13 Constr. Teamsters Local No. 216 v. Granite Rock Co., 851 F.2d 1190, 1197 (9th Cir. 1988) (?nding ?collateral estoppel inappropriate? for ?a ?nding [that] was not necessary to [the agency?s] determination of the ultimate legal question before 4. The issues decided in the sanctions proceedings are not identical to the issues here. Finally, plaintiffs cannot establish that the issues involved in the sanctions proceedings were identical to their claims now before this Court. Yet this is a legal requirement. a. The elements for sanctions and abuse of process are different. This Court previously found that the issues in Haeger I are substantially different than here because the elements are different. 9/10/15 Tr. 125. Plaintiffs have provided no reason to revisit this holding. ?[T]he party asserting issue preclusion must show that the estoppel issues are identical to the issues litigated in the prior action.? Keating 186 F.3d at 1116. To make these determinations, the court must ?examine the elements of the counts? which were decided in the prior action and those in the present case and ?[i]ssue preclusion can be properly applied only if the determinations in [the prior 12 action] support each element of the [current] claims.? Id. Here, the prior federal action related to imposition of sanctions under the district court?s inherent equitable power. The only requirement for the imposition of such sanctions was a ??nding that the sanctioned party?s behavior constituted or was tantamount to bad faith.? Haeger, 2015 US. App. Lexis 12484, at 24; Haeger, 906 F. Supp. 2d at 974. An abuse of process claim, by contrast, requires proof of: (1) a willful act in the use of speci?c court procedures; (2) for an ulterior purpose not proper in the regular conduct of the proceedings. Crackel v. Allstate Ins. C0., 208 Ariz. 252, 257 (App. 2004). ?Because . . . the legal standard for determining whether that duty is breached differs from the standard employed in [the prior action], the issues involved in the two cases are different [and] . . . [c]ollateral estoppel is thus inapplicable.? Keatz'ng, 186 F.3d at 1118; Acevedo-Garcia v. Monroig, 351 F.3d 547, 576-77 (lst Cir. 2003) (?Where even one issue of liability must be made available to defendants in the second trial, granting preclusive effect to the other issues may not result in ef?ciency gains because litigation of the ?live? issue may require introduction of some of the same evidence pertinent to the estopped issues?). b. The elements of an abuse of process claim were not litigated. It is readily apparent that plaintiffs seek to impose offensive collateral on a different claim requiring proof of di?"erent elements than required by an inherent authority bad faith ?nding. The elements of an abuse of process claim were not ?raised, contested by the parties, submitted for declaration by the court, and determined.? Keaty, 397 F.3d at 272. Indeed, the district court expressly noted that it was not deciding any future civil claim plaintiffs might assert. Haeger, 906 F. Supp. 2d at 973. And plaintiffs earlier acknowledged that the district court?s order ?was limited to studying the record for purposes of determining appropriate attorney fee sanctions? and that the ?conduct and appropriate punishment [at issue in] this lawsuit . . . were [not], or could [not] have been, addressed by Judge Silver in her sanctions order.? Pls. Disclosure Statement p.8 (emphasis added) (attached as Exhibit to Fennemore Craig?s Response to Plaintiffs? Motion for Determination of Prima Facie Case for Punitive Damages). ?Because the evidence necessary to prove? abuse of process ?differ[s] signi?cantly? from the 13 issues involved in the sanctions proceeding, ?the [prior] ?ndings cannot support the application of issue preclusion.? Keating, 186 F.3d at 1118. claimant must present more than mere speculation to support the assertion that the defendant has used court processes with an improper intent. Instead, a plaintiff must show that the defendant?s improper purpose was the primary motivation for its actions, not merely an incidental motivation,? and that the use of process is ?so lacking in justi?cation as to lose its legitimate function as a reasonable justi?able litigation procedure.? Crackel v. Allstate Ins. Co., 208 Ariz. 252, 257-259 (App. Div. 2004) (emphasis added). That was not the issue before the district court, nor was it part of its ruling. Although the district court made some ?ndings related to defendants? discovery conduct, they were not in the context of using an act of judicial process for an improper, ulterior purpose. At most, the district court found that Goodyear and its counsel engaged in improper litigation tactics?but ?improper litigation tactics . . . alone, do not rise to the level of abuse of process. Case law regarding abuse of process in the discovery context underscore the difference between Judge Silver?s discovery sanction and plaintiffs? claim. In the only case defendants have found where plaintiffs alleged an abuse of process for failure to respond to discovery, the court rejected the argument. Flores v. Emerich Fike, 416 F. Supp. 2d 885, 907 (ED. Cal. 2006). The plaintiffs alleged that the defendants wrongfully said ?there were no more documents in their care, custody or control,? yet somehow ?manage[d] to ?nd numerous documents previously requested which [defendant] denied existed.? The court said that, at most, these allegations suggested a violation of civil discovery rules, which does not alone constitute an abuse of process. Notably, in a ruling directly precedential here, the court further observed that it was ?impermissible to sue for prior violations of discovery rules in a subsequent lawsuit,? in part because there are ?any number of legitimate not improper) reasons why documents initially not disclosed might later be provided in discovery. This is the nature of civil litigation.? Id.? ?Because the evidence necess to prove these two issues differ si '?cantl the ary gm ll Flores is consistent with abuse of process case law generally. ?Process? contemplates use of the court compulsory powers. E.g. Nienstedt v. Wetzel, 133 Ariz. 348, 353, 651 P.2d 876, 881 (App. 1982) (?processes,? includes ?the noticing of depositions, the entry of defaults, and the utilization of various 14 [prior] ?ndings cannot support the application of issue preclusion.? Keating, 186 F.3d at 1118. IV. CONCLUSION For each of the foregoing reasons, as well as the reasons provided in defendants? prior oppositions relating to the collateral estoppel issue, this Court should deny plaintiffs? Motion for Summary Judgment. I RESPECTFULLY SUBMITTED this 9th day of January, 2017. s/ Brian M. McQuaid Brian M. McQuaid SQUIRE PATTON BOGGS (US) LLP 1 East Washington Street, Suite 2700 Phoenix, Arizona 85004 Telephone: (602) 528-4000 Facsimile: (602) 253-8129 Jill G. Okun (admitted pro hac vice) PORTER WRIGHT MORRIS ARTHUR LLP 950 Main Avenue, Suite 500 Cleveland, Ohio 44113-7206 Telephone: (2 1 6) 443 -2508 Facsimile: (216)443-901 1 James M. Brogan (admitted pro hac vice) DLA Piper LLP (US) One Liberty Place 1650 Market Street, Suite 4900 Philadelphia, 19103 Telephone: (215) 656-3300 ames.Brogan@dlapiper.com Attorneys for Defendants The Goodyear Tire Rubber Company and Deborah A. Okey motions such as motions to compel production, for protective orders, for change of judge, for sanctions and for continuances?). Actions taken in litigation that do not rely on the power of the court to compel the other side to act or otherwise respond, do not amount to the use of legal process. See Gen. Refractories Co. v. Fireman?s Fund Ins. Co., 337 F.3d 297, 307 (3d Cir. 2003) of the alleged uses of legal process, such as failing to comply with court orders, failing to seek a stay, and failing to provide copies of subpoenaed documents, as well as contacting the asbestos litigation counsel, do not constitute use of a legal process for purposes of an abuse of process claim . . . 15 CERTIFICATE I hereby certify that on January 9, 2017, transmitted to the Clerk?s of?ce using the eFiling System for ?ling. COPY provided via eFiling System to: The Honorable John R. Hannah, Jr. Maricopa County Superior Court Northeast Court-G 183 80 N. 40th St. Phoenix, AZ 85032 COPY of the foregoing e-mailed this same date to: Patrick J. McGroder, Kevin D. Neal Gallagher Kennedy, PA. 2575 East Camelback Road Phoenix, AZ 85016-9225 David L. Kurtz The Kurtz Law Firm 7420 E. Pinnacle Peak Road, Suite 128 Scottsdale, AZ 85255 Betty Rios SERVICE the foregoing document was electronically l6