VIII. Defenses
Estoppel Defenses
Sixth Circuit
• Collateral EstoppelHardesty v. Hamburg Twp, 05-1346 (9/1/06)
> Officers entered Hardesty and his father’s home and discovered Hardesty and other minors had been unlawfully consuming alcohol. Hardesty and the other minors were charged in state court with being minors in possession of alcohol. One of the minors moved to suppress the evidence found by the officers based upon an unlawful entry into the home. The state court agreed and suppressed the evidence. As a result, the state charges were dropped against all of the minors, including Hardesty. Subsequently, Hardesty and his father filed an action against the officers and the police department, pursuant to 42 USC § 1983, claiming that the officers had violated his Fourth Amendment rights and that the doctrine of collateral estoppel required that the district court adhere to the state court decision that an unlawful search had occurred. The district court granted summary judgment to the officers, and Hardesty appealed.
* Holding: The court held that federal courts must give the same preclusive effect to state court judgments as those judgments would receive in the state court. The court noted that, under Michigan law, collateral estoppel applies when (1) there is an identity of parties across the proceedings, (2) there was a valid final judgment, (3) the same issue was litigated and decided in the first proceeding, and (4) the party against whom it is asserted had a full and fair opportunity to litigate the issue. In the case, the court found that the first element failed because the police-officer defendants in the § 1983 action were not in privity with the prosecution of the underlying state criminal charge. Thus, collateral estoppel did not apply and the court proceeded to the merits. (See supra).
• Res Judicata/Collateral Estoppel
U.S. v. Vasilakos, 05-3166 (11/21/07)
> Defendant was charged with conspiracy, mail fraud, and money laundering over his scheme to steal money from his employer. Defendant argued in the district court that the prosecution should be precluded because defendant won an earlier civil law suit brought by the employer. The district court disagreed and defendant appealed.
* Holding: The doctrine of res judicata bars future claims where there is (1) a final decision on the merits by a court, (2) privity between the parties, (3) an issue in the subsequent litigation that was, or should have been, litigated in the prior action, and (4) identity of the causes of action. Collateral estoppel precludes re-litigating issues between parties or their privies. The court held that a party in “privity” is one who is a successor in interest to a party, one who controlled the prior action, or one whose interests were adequately represented. In the case, the court ruled that the government was not in privity with the employer who brought the civil law suit against defendant, and accordingly neither res judicata nor collateral estoppel precluded the prosecution.
• Entrapment by Estoppel
U.S. v. Triana, 05-3173 (11/2/06)
> Defendant was a doctor who was convicted of medicare fraud. As a result, his conditions of supervised release required that he not participate in a company that received medicare reimbursements and that he report to his probation officer any interest he obtained in a company that received such reimbursements. Defendant subsequently secretly ran two businesses that submitted substantial claims to medicare and he siphoned the money out of the businesses through sophisticated means. Defendant was then charged with conspiring to defraud medicare and making false statements to the federal probation department. At trial, defendant pursued the defense of entrapment by estoppel, claiming that he disclosed the nature of his businesses to the probation department and that the activities were approved. The district court refused to instruct the jury on the defense of entrapment by estoppel, defendant was convicted, and he appealed.
* Holding: In order to prove an entrapment by estoppel defense, the defendant must show that (1) a government agent announced that the conduct was legal, (2) the defendant relied on the agent’s announcement, (3) the reliance was reasonable, and (4) given the reliance, prosecution would be unfair. The court found that defendant could not meet the first element of the test because (a) defendant was repeatedly advised as to what conduct was illegal for him and he knowingly engaged in illegal conduct, and (b) defendant withheld substantial information from his probation officers and misstated critical facts about the nature of his employment in an effort to conceal the true nature of what he was doing. Accordingly, the court affirmed the district court’s refusal to provide the jury instruction.