Roth et al v. Evangelical Lutheran Good Samaritan Society, The
Filing
60
ORDER granting in part and denying in part 46 Motion For Order Confirming Arbitration Decision and Directing Entry of Judgment Thereon by The Evangelical Lutheran Good Samaritan Society and denying 49 Motion to Enter Order Confirming Arbitration Decision and Directing Entry of Judgment. Summary judgment is rendered in favor of defendant as to Count IV. The Clerk of Court is directed to enter judgment in defendants favor as to all counts. Signed by Judge CJ Williams on 05/14/2019. (jjh)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF IOWA
WESTERN DIVISION
MARY E ROTH, Individually and as CoExecutor of the Estate of Cletus Roth;
MICHAEL A ROTH, Individually and as
Co-Executor of the Estate of Cletus Roth;
ANNA M ROTH; BRADLEY E ROTH,
No. 15-CV-4074-CJW-MAR
MEMORANDUM OPINION
AND ORDER
Plaintiffs,
vs.
THE EVANGELICAL LUTHERAN
GOOD SAMARITAN SOCIETY, d/b/a
GOOD SAMARITAN SOCIETY—
GEORGE,
Defendants.
___________________________
TABLE OF CONTENTS
I.
FACTUAL AND PROCEDURAL HISTORY ......................................... 3
A.
B.
Certified Questions ................................................................. 4
C.
II.
Proceedings in this Court and Arbitration ...................................... 3
Second Arbitration Agreement .................................................... 6
FEDERAL ARBITRATION ACT ....................................................... 7
A.
Applicable Law ...................................................................... 7
B.
Discussion ............................................................................ 8
III.
ISSUE PRECLUSION.....................................................................11
IV.
PROCEDURAL POSTURE ..............................................................21
V.
CONCLUSION .............................................................................23
This matter is before the Court on the parties’ Stipulation for Order Confirming
Arbitration Decision and Directing Entry of Judgment Thereon (Doc. 46), and on
defendant’s Motion Requesting Court to Execute Proposed Order Confirming Arbitration
Decision and Directing Entry of Judgment Thereon, in Accordance with the Parties’
Stipulation (Doc. 49). As explained more fully infra, the parties jointly submitted a
proposed order confirming an arbitration decision, and the parties request that the Court
enter that proposed order. (See Docs. 46, 46-3). Although the parties interpret the
proposed order differently, both parties now request that the Court enter the proposed
order. The Court declines to do so because the proposed order is not clear as to which
parties would be subject to final judgment under the order.
The parties have also requested that the Court determine whether the individual
plaintiffs’ loss of parental consortium claims survive the arbitrator’s decision, or whether
the arbitrator’s decision has a fatally preclusive effect on the individual plaintiffs’ claims.
The Court finds it appropriate to resolve this issue. The parties submitted briefs on the
issue (Docs. 52-54), the Court held a hearing on the issue, and defendant submitted a
supplemental brief on the issue, with leave of Court (Doc. 58). Although permitted to
do so, plaintiff declined to submit a supplemental brief on the issue. (See Doc. 59).
For the following reasons, the parties’ Stipulation for Order Confirming
Arbitration Decision and Directing Entry of Judgment Thereon (Doc. 46) is granted to
the extent the pleading seeks entry of judgment on Counts I, II, III, and V, denied to the
extent the pleading seeks entry of judgment as to Count IV, and denied to the extent the
2
pleading seeks entry of the parties’ proposed order (Doc. 46-3). Defendant’s individually
filed Motion Requesting Court to Execute Proposed Order Confirming Arbitration
Decision and Directing Entry of Judgment Thereon, in Accordance with the Parties’
Stipulation (Doc. 49) is denied as moot to the extent the pleading seeks entry of judgment
on Counts I, II, III, and V, and denied to the remaining extent the pleading constitutes a
motion. Summary judgment is rendered in favor of defendant as to Count IV. The Clerk
of Court is directed to enter judgment in defendant’s favor as to all counts.
I.
A.
FACTUAL AND PROCEDURAL HISTORY
Proceedings in this Court and Arbitration
Defendant is a long-term care facility that “provided nursing home care and
memory care services for Cletus Roth from November 27, 2013[,] through February 27,
2014.” (Doc. 30, at 2). Around the time Cletus Roth (“Cletus”) was admitted to
defendant’s facility, Cletus’ son, Michael Roth, signed an “Admission Agreement” on
Cletus’ behalf.1 (See Doc. 46-2, at 1-16). The Admission Agreement contained an
arbitration provision providing as follows: “Any legal controversy, dispute, disagreement
or claim of any kind arising out of or related to this Admission Agreement, or the breach
thereof, or, related to the care of [sic] stay at the Facility, shall be settled exclusively by
binding arbitration . . ..” (Id., at 14). The arbitration provision also specified that the
Federal Arbitration Act, Title 9, United States Code, Section 1, et. seq., was to govern
the arbitration provision and “all proceedings relating to the arbitration of any claim.”
(Id., at 15).
Cletus ultimately died, and Cletus’ children commenced this action, contending
that defendant was responsible for Cletus’ death. Mary E. Roth and Michael A. Roth,
1
Michael Roth appears to have signed the Admission Agreement as attorney-in-fact for Cletus.
Defendant does not contend that Michael Roth signed the Admission Agreement in his individual
capacity.
3
in their capacities as co-executors of Cletus’ Estate brought claims for wrongful death,
breach of contract, dependent adult abuse, and punitive damages. (Doc. 3). Mary and
Michael Roth, along with their siblings Anna M. Roth and Bradley E. Roth, each brought
a claim for loss of parental consortium. (Id.).
Defendant filed a motion to compel arbitration (Doc. 6), and this Court granted
that motion “as to the plaintiff [E]state’s claims.” Roth v. Evangelical Lutheran Good
Samaritan Soc’y, 147 F. Supp. 3d 806, 814 (N.D. Iowa 2015) (emphasis omitted). The
Court did not compel arbitration as to the individual plaintiffs’ loss of consortium claims
and, instead, certified two questions to the Iowa Supreme Court regarding the arbitrability
of the individual plaintiffs’ loss of consortium claims.
Id. at 814-15. This Court
permitted the parties to “decide for themselves whether to proceed immediately to
arbitration of [the Estate’s claims] or to await answers to the questions certified . . .
before doing so.” Id. at 814. The parties chose to await the Iowa Supreme Court’s
opinion before proceeding to arbitration. Ultimately, the arbitrator found that defendant
did not act negligently and that judgment should enter in favor of defendant as to those
claims that were submitted to the arbitrator. (See Doc. 46-1).
B.
Certified Questions
The Iowa Supreme Court answered only one of the certified questions: Does Iowa
Code Section 613.15 require that adult children’s loss-of-parental-consortium claims be
arbitrated when the deceased parent’s estate’s claims are otherwise subject to arbitration?
Roth v. Evangelical Lutheran Good Samaritan Soc’y, 886 N.W.2d 601, 603 (Iowa 2016).
In answering the question, the Iowa Supreme Court turned to the facts of this case directly
and held that the individual plaintiffs’ loss of consortium claims were not subject to
arbitration. Id. at 613. Moreover, the Iowa Supreme Court held that although “loss-ofconsortium claims . . . could be subject to arbitration, a decedent’s arbitration agreement
alone is an insufficient basis for this outcome.” Id. (emphasis in original).
4
In reaching this holding, the Iowa Supreme Court explained that under Iowa law,
a loss of parental consortium claim belongs to the child of the decedent but should be
brought by the personal representative of the decedent’s estate. Id. at 606-07 (“In the
case of a parent’s death, the child’s claim for loss of parental consortium should be
brought by the decedent’s administrator under [Iowa Code S]ection 613.15.” (citation
and quotation marks omitted)); id. (“The cause of action for parental consortium is to be
commenced by . . . the parent’s estate although the ownership of the proceeds [is] in the
child.” (alterations in original) (citation and internal quotation marks omitted)).
The Iowa Supreme Court went on to recognize multiple exceptions to the rule that
the personal representative of a decedent’s estate is the statutory plaintiff empowered to
bring loss of consortium claims. Id. at 607-08. One exception is when the child of a
decedent establishes “that it is impossible, impracticable or not in the child’s best interest
for the [statutory plaintiff] to maintain the action.” Id. at 607 (citation and internal
quotation marks omitted). The court also noted “that the rights of adult children to
manage and control their own affairs requires that where disagreement arises over who
shall control the course of the litigation, this circumstance alone should permit an adult
child to maintain a claim under [S]ection 613.15 in the child’s own name.” Id. (citation
and internal quotation marks omitted). In short, the Iowa Supreme Court concluded that
under Iowa law, 1) the personal representative of a decedent estate will often be the
proper plaintiff by whom a loss of parental consortium claim should be brought; 2) a loss
of parental consortium claim is not subject to arbitration simply because the decedent
estate’s claims would be subject to arbitration; and 3) the individual plaintiffs’ loss of
consortium claims in this case were not subject to arbitration under the Admission
Agreement.
5
C.
Second Arbitration Agreement
After the Iowa Supreme Court issued its decision, counsel for the parties entered
into a separate “Agreement for Binding Arbitration.” (Doc. 46-2, at 17-21). Plaintiffs
are all represented by the same attorneys. One of those attorneys signed the “Agreement
for Binding Arbitration” on behalf of “Claimant.” (See id., at 21). The agreement states
that “Claimant” refers to “Estate of Roth.” (Id., at 19). Defendant has abandoned its
argument that the individual plaintiffs’ loss of consortium claims were subject to
arbitration based on the Admission Agreement. Defendant now argues that the second
agreement, the “Agreement for Binding Arbitration,” encompassed all claims that the
Estate had standing to pursue, including the loss of consortium claims. (See Doc. 53, at
8 (“The Estate had a full and fair opportunity to present all claims that it had standing to
pursue, including the adult children’s loss of consortium claims, had it chosen to.”
(emphasis in original)). Defendant thus reasons that counsel’s signature on behalf of
“Estate of Roth” was made on behalf of the Estate, in its own capacity, and on behalf of
the individual plaintiffs.
Based on defendant’s argument that the loss of consortium claims were included
in the “Agreement for Binding Arbitration,” defendant asserts that the Federal
Arbitration Act entitles defendant to judgment in its favor on all claims, including the
loss of consortium claims.
(Id., at 9).
Alternatively, defendant argues that the
arbitrator’s finding that defendant “properly cared for [Cletus]” (Doc. 46-1, at 5-6),
should be given preclusive effect as to the individual plaintiffs’ loss of consortium claims.
(Doc. 53, at 10-12).
Plaintiffs do not contest that this Court should enter judgment in favor of defendant
on the claims that have been brought on behalf of the Estate. Plaintiffs’ only challenge
is with respect to the loss of consortium claims. Plaintiffs assert that the arbitrator had
jurisdiction over only the Estate’s claims—not the individual plaintiffs’ claims—and that
6
the arbitrator’s decision should have no effect on the individual plaintiffs’ claims. (Doc.
54, at 1-2). Additionally, plaintiffs assert that under Iowa law, the arbitrator’s decision
should not be given preclusive effect as to the individual plaintiffs’ claims. (Docs. 52,
at 5-9; 54, at 3-4).
II.
FEDERAL ARBITRATION ACT
As noted, defendant asserts two different theories in support of its argument that
the arbitral decision resolves all issues remaining in this case. The Court will address
both of those theories, turning first to defendant’s argument under the Federal Arbitration
Act, then to defendant’s argument that the doctrine of issue preclusion bars plaintiff from
relitigating the issue of whether defendant acted negligently in caring for Cletus.
A.
Applicable Law
The Federal Arbitration Act provides as follows:
[Section 2] A written provision in any . . . contract evidencing a
transaction involving commerce to settle by arbitration a controversy . . .
arising out of such contract or transaction . . . shall be valid, irrevocable,
and enforceable . . ..
[Section 9] If the parties in their agreement have agreed that a
judgment of the court shall be entered upon the award made pursuant to the
arbitration, . . . any party to the arbitration may apply to the court . . . for
an order confirming the award, and thereupon the court must grant such an
order unless the award is vacated, modified, or corrected . . ..
9 U.S.C. §§ 2, 9.
The United States Supreme Court has held that Section Two of the Federal
Arbitration Act addresses “written arbitration agreements.” Arthur Andersen LLP v.
Carlisle, 556 U.S. 624, 629-30 (2009). Although Section Two “creates substantive
federal law regarding the enforceability of arbitration agreements,” it does not “purport[ ]
to alter background principles of state contract law regarding the scope of agreements
(including the question of who is bound by them).” Id. at 630. The Supreme Court went
7
on to hold that state law “is applicable to determine which contracts are binding under
[Section Two] . . . if that law arose to govern issues concerning the validity, revocability,
and enforceability of contracts generally.” Id. at 630-31 (emphasis in original) (citations
and internal quotation marks omitted).
B.
Discussion
Defendant now argues that the “Agreement for Binding Arbitration,” which is a
written contract contemplating arbitration, is applicable to both the Estate and to the
individual plaintiffs. To determine whether the individual plaintiffs in this case agreed
to arbitrate their loss of consortium claims under the “Agreement for Binding
Arbitration,” the Court must turn to Iowa law to determine whether plaintiffs’ counsel
signed the Agreement on behalf of just the Estate, in its own capacity, or whether counsel
also signed the Agreement on behalf of the Estate, in its capacity as representative of the
individual plaintiffs’ claims. In answering this Court’s certified question, the Iowa
Supreme Court held “it seems quite wrong that an adult child could be bound to [the
Federal Arbitration Act] absent his or her agreement, simply because the adult child’s
claim is routed procedurally through a different party.” Roth, 886 N.W.2d at 613-14.
Thus, the question in this case becomes whether the individual plaintiffs, who are Cletus’
adult children,2 agreed to submit their claims to arbitration under the “Agreement for
Binding Arbitration.”
Here, there is no indication that the individual plaintiffs agreed to arbitrate their
claims. Indeed, the individual plaintiffs, through the same attorney who signed the
“Agreement for Binding Arbitration” successfully argued against defendant’s motion to
2
In their complaint, plaintiffs plead that the individual plaintiffs “are the adult children of Cletus
Roth.” (Doc. 3, at 7). Although defendant denied the allegation “for lack of information,”
(Doc. 30, at 5), there appears to be no real dispute whether the individual plaintiffs have reached
the age of majority.
8
compel arbitration. The Iowa Supreme Court unequivocally stated, “we do not find the
[individual plaintiffs’] consortium claims subject to arbitration under the facts certified to
us.” Roth, 886 N.W.2d at 613. Defendant has not come forward with an explanation as
to why the individual plaintiffs would change their stance as to arbitrability in the days
immediately before the Estate’s claims were to proceed to arbitration, nor has defendant
come forward with any evidence indicating that the individual plaintiffs actually did
change their stance and agree to arbitration.
“In order to be bound, the contracting parties . . . must manifest their mutual
assent to the terms sought to be enforced. Mutual assent is present when it is clear from
the objective evidence that there has been a meeting of the minds.” Estate of Cox v.
Dunakey & Klatt, P.C., 893 N.W.2d 295, 302-03 (Iowa 2017) (citations and internal
quotation marks omitted). Considering the backdrop of this case as submitting only the
Estate’s claims—not the individual plaintiff’s claims—to arbitration, there is nothing to
indicate that the parties3 would have understood the “Agreement for Binding Arbitration”
as binding the individual plaintiffs, as well as the Estate. Further, the Court finds that
the objective evidence before the Court certainly does not make it “clear” that the
individual plaintiffs agreed to arbitrate their claims, either on their own or through the
Estate. If the objective evidence shows anything, it is that the individual plaintiffs did
not agree to arbitrate their claims, either by acting on their own behalves or through the
Estate.
The Court offered the parties the opportunity to address whether the Court should
consider parol evidence in interpreting the meaning of “the Estate,” as used in the
“Agreement for Binding Arbitration.” Neither party addressed the issue, however, and
the Court will not consider whether “the Estate” is ambiguous such that parol evidence
3
As used here, “parties” means the Estate, as a signatory to the “Agreement for Binding
Arbitration,” and defendant.
9
could be considered, nor will the Court consider any parol evidence. See Montgomery
Props. Corp. v. Econ. Forms Corp., 305 N.W.2d 470, 475-76 (Iowa 1981) (“Although
extrinsic evidence may be admissible to explain the real meaning of the parties by the
language used in a contract, the parol evidence rule forbids the use of extrinsic evidence
to vary, add to, or subtract from a written agreement.” (citations omitted)). The Court
will note, however, that if the Court were to consider parol evidence, the only parol
evidence the Court has would reinforce the Court’s finding that the individual plaintiffs
did not agree to arbitrate their claims. (See Doc. 54-2, at 1 (email from plaintiffs’ counsel
stating “We have always proceeded as though we are arbitrating the claims of the [E]state
. . .. I want to be explicit that we are arbitrating the Estate’s claims . . . and that the
consortium claims of the children remain with the district court to be tried . . ..”)).
On this record, there is simply no indication, much less an evidentiary showing,
that the individual plaintiffs agreed to arbitrate their claims or that the Estate bound them
to arbitrate their claims. As the individual plaintiffs did not agree to arbitrate their claims,
the arbitrator’s decision should be given no direct effect as to the individual plaintiffs.4
4
Defendant included the following caveat in its supplemental brief:
Arbitration is a matter of contract. The Estate of Cletus Roth . . . by its
counsel, signed a contract on December 6, 2018, agreeing to resolve all disputes
it had against [defendant]. Plaintiff’s counsel had the authority to select the
arbitrator and to bind the Estate, in contract, to arbitrate any issue.
[Defendant] has made this argument for judgment on the loss of
consortium claim separate and apart from its primary argument for issue
preclusion and in the alternative. If this Court has not been persuaded that a
contract, signed by [p]laintiff’s counsel on December 6, 2018, submitted the loss
of consortium claim to arbitration, then [defendant] withdraws this argument and
asks this Court to return to its former understanding of [which] claims actually
were submitted and were decided by the arbitrator.
(Doc. 58, at 3 (emphasis in original)).
10
The Court does find, however, and the parties agree, that the arbitration decision
is valid as to the Estate’s claims. Pursuant to Section Nine of the Federal Arbitration
Act, the parties’ Stipulation for Order Confirming Arbitration Decision and Directing
Entry of Judgment Thereon is granted as to all pending claims that the Estate of Cletus
Roth owns, and denied as the individual plaintiffs’ loss of consortium claims. Judgment
is to be entered in favor of defendant on Counts I, II, III, and V. Defendant’s Motion
Requesting Court to Execute Proposed Order Confirming Arbitration Decision and
Directing Entry of Judgment Thereon, in Accordance with the Parties’ Stipulation (Doc.
49), which is not a joint motion, is denied as moot.
III.
ISSUE PRECLUSION
Defendant next argues that even if the individual plaintiffs’ claims were not subject
to arbitration and were, thus, not resolved by the arbitral decision, the individual plaintiffs
would be unable to prove their claims at trial. Specifically, defendant argues that the
arbitrator’s finding that defendant “properly cared for [Cletus],” (Doc. 46-1, at 5-6), was
a finding that defendant did not act negligently with respect to Cletus’ care, and that this
finding should be given preclusive effect as to the individual plaintiffs’ claims. (Doc.
53, at 12). Based on the assertion that the arbitrator’s finding should be given preclusive
effect, defendant argues that the individual plaintiffs will be unable to prove an essential
As explained in the body of this Order, the Court is not persuaded that the December 6, 2018
contract binds the individual plaintiffs. The Court is unclear, however, as to the “former
understanding” defendant references. In light of the uncertainty, the Court finds it more proper
to consider defendant’s argument under the Federal Arbitration Act as not having been
withdrawn. Should the issue arise in the future, defendant may more fully explain which
argument defendant wishes to withdraw, and the Court will consider the issue at that time.
Further, although the Court addresses the Federal Arbitration Act first in considering the parties’
arguments, the Court’s conclusions would be the same if the Court were to address issue
preclusion first.
11
element of their consortium claims—the element of negligence—and that judgment should
thus be entered in favor of defendant on the consortium claims. (Id., at 18-19).
Federal courts “look to state law in determining whether to apply issue
preclusion.” Manion v. Nagin, 394 F.3d 1062, 1066 (8th Cir. 2005) (citation and internal
quotation marks omitted). The Court will, thus, consult Iowa law in addressing the
parties’ arguments regarding issue preclusion.
The doctrine of issue preclusion prevents a party to a prior action in
which a judgment has been rendered from relitigating in a subsequent action
issues raised and resolved in the previous action. We have said that issue
preclusion applies if the following four requirements are met: 1) the issue
determined in the prior action is identical to the present issue; 2) the issue
was raised and litigated in the prior action; 3) the issue was material and
relevant to the disposition in the prior action; and 4) the determination made
of the issue in the prior action was necessary and essential to that resulting
judgment.
In addition to these four requirements, either 1) the parties in both
actions must be the same (mutuality of parties), or 2) there must be privity
between the party against whom issue preclusion is invoked and the party
against whom the issue was decided in the first litigation. A “privy” means
one who, after rendition of the judgment, has acquired an interest in the
subject matter affected by the judgment through or under one of the parties,
as by inheritance, succession, or purchase.
Dettman v. Kruckenberg, 613 N.W.2d 238, 244 (Iowa 2000) (internal citations and
quotation marks omitted).
The Iowa Supreme Court has not directly addressed the issue of whether a binding
arbitral decision can have a preclusive effect in a subsequent court proceeding. An Iowa
District Court, on the other hand, has found an arbitral decision to have a preclusive
effect in a subsequent court case. Horsfield Constr., Inc. v. City of Dyersville, Nos.
LACV054287, LACV055840, 2011 WL 4873434 (Iowa Dist. Ct. Aug. 8, 2011).
Further, the Iowa Supreme Court has entertained cases asserting that an arbitral decision
can have a preclusive effect. See, e.g., Westegard v. Davis Cty. Cmty. Sch. Dist., 580
12
N.W.2d 726, 728-29 (Iowa 1998).5 See also Woodruff v. Assoc. Grocers of Iowa, Inc.,
364 N.W.2d 215, 217 (Iowa 1985) (the court held that it is possible for an arbitral
decision to have a preclusive effect on a claim that could have been properly brought
before an arbitrator, but the court did not squarely address whether the same preclusive
effect could be had on a claim over which the arbitrator had no authority).
The caselaw, thus, indicates that under Iowa law, an arbitration decision can have
a preclusive effect in subsequent court cases.
Regardless, the parties’ briefs and
arguments are made as though the parties agree that an arbitral decision can have a
preclusive effect in a subsequent court proceeding. (See Doc. 52, at 6-7 (acknowledging
that in certain circumstances, arbitrations can have a preclusive effect in subsequent legal
proceedings; proceeding to argue the merits of issue preclusion, but declining to argue
that preclusive application of an arbitral decision in subsequent court proceedings would
be improper)). The Court therefore finds it unnecessary to address the issue further.
The Court finds that the first four elements enumerated in Dettman are satisfied,
and the parties do not argue otherwise. The issue of defendant’s negligence was an
element of the Estate’s wrongful death claim. See Wolbers v. Finley Hosp., 673 N.W.2d
728, 735 (Iowa 2003) (in a wrongful death action, addressing whether the defendant was
negligent in breaching the applicable standard of care). The wrongful death claim was
properly before the arbitrator, and the arbitrator found that defendant properly cared for
5
The Iowa Supreme Court has interpreted Westegard as holding that “arbitration awards may
have preclusive effect in later litigation if the issues are identical.” Deerfield Constr. Co. v.
Crisman Corp., 616 N.W.2d 630, 632 (Iowa 2000). Deerfield, however, presented the issue of
whether an arbitral decision could have a preclusive effect in a subsequent arbitration, not in a
subsequent court case. Id. See also AFSCME Iowa Council 61 v. Iowa, Dep’t. of Pers., No.
05-1891, 2007 WL 750602, at *4 (Iowa Ct. App. Mar. 14, 2007) (citing Deerfield for the
proposition that “[t]he concept of issue preclusion is applicable in successive arbitrations if the
issues are identical” (emphasis added)). Thus, although Deerfield is informative, it leaves
unanswered the question of whether an arbitral decision can have a preclusive effect in a
subsequent court case.
13
the decedent. The issue of whether defendant rendered proper care is, thus, identical as
between the loss of consortium claims and the wrongful death claim. Moreover, to
succeed on their loss of consortium claims, the individual plaintiffs must show that
defendant acted negligently. Audubon-Exira Ready Mix, Inc. v. Ill. Cent. Gulf R.R. Co.,
335 N.W.2d 148, 149 (Iowa 1983) (recognizing that recovery can be had on a loss of
consortium claim upon a finding of negligence). The issue of negligence is, thus, material
to the loss of consortium claims, just as it was to the wrongful death claim.
The parties presented evidence and testimony to the arbitrator, which establishes
that the parties actively litigated the arbitration, as is discussed infra. Finally, the
arbitrator reached his decision based on his finding that defendant properly cared for the
decedent. (Doc. 46-1, at 5-6). Because this was the sole basis for the arbitrator’s
decision, the issue of negligence was necessary and essential to the arbitrator’s decision
in favor of defendant. Likewise, had the arbitrator found in favor of plaintiff, the
arbitrator would have had to make an affirmative finding of negligence. This, again,
would render the issue of negligence a necessary and essential component of the arbitral
decision.
The Court finds, however, that the parties to the arbitral proceedings were not the
same as the parties to this action. Although defendant was named in both actions, the
plaintiffs were not identical in the two actions. In the arbitral forum, the only claimants
were Mary E. Roth and Michael A. Roth, as co-executors of the Estate. (Doc. 46-1, at
1). Mary E. Roth and Michael A. Roth were not parties in their individual capacity.
Further, Anna M. Roth and Bradley E. Roth are named plaintiffs in this action, are not
co-executors of the Estate, and were not parties, in any capacity, to the arbitration
proceedings. The Court, thus, finds that the parties were not the same in both actions.
Specifically, the Court finds that the only overlap between the parties in this case and the
parties to the arbitration proceedings are defendant, and Mary E. Roth and Michael A.
14
Roth, to the extent Mary E. Roth and Michael A. Roth are privileged to act in their
capacities as co-executors of the Estate.
None of Cletus’ adult children, in their
individual capacities, were named in the arbitration proceedings and, thus, were not
parties to that action. The turning point for the applicability of issue preclusion, then,
rests on whether the parties to the arbitration proceedings are in privity with the four
adult children who are named as plaintiffs in this action.
The Iowa Supreme Court has long emphasized that for a prior determination to
have a preclusive effect on a privy, the privy’s property interest in the subject matter
affected by the judgment cannot have attached before the judgment was rendered:
“Privity” is said to be a mutual or successive relationship to the same rights
of property, and if it is sought to bind one as privy by an adjudication
against another with whom he is in privity, it must appear that at the time
he acquired the right . . . it was then affected by the adjudication, for, if
the right was acquired by him before the adjudication, then the doctrine
cannot apply.
White v. Peterson, 269 N.W. 878, 880-81 (Iowa 1936) (emphasis in original) (citation
and internal quotation marks omitted). See also Brown v. Kassouf, 558 N.W.2d 161,
163 (Iowa 1997) (“A ‘privy’ for issue preclusion purposes means one who, after rendition
of the judgment, has acquired an interest in the subject matter affected by the judgment
through or under one of the parties, as by inheritance, succession, or purchase.” (citation
and internal quotation marks omitted)).
In this case, the Court finds that there can be no real question as to whether the
individual plaintiffs’ interests in their loss of consortium claims accrued long before the
arbitral decision was rendered. In arguing this case in the arbitral forum, the parties
stipulated that Cletus passed away on March 17, 2014. (Doc. 54-1, at 1). The individual
plaintiffs’ loss of consortium claims accrued at the time they became aware of their
father’s death. See Christy v. Miulli, 692 N.W.2d 694, 706 (Iowa 2005) (holding that
15
the statute of limitations for loss of spousal consortium claims begins to run on the date
the surviving spouse learns of the decedent spouse’s death).
The parties have not informed the Court as to the date each individual plaintiff
became aware of Cletus’ death, but the Court finds that they must have become aware of
Cletus’ death before filing their complaint on August 14, 2015. (Doc. 3). At the very
latest, then, the individual plaintiffs’ loss of consortium claims accrued on August 14,
2015. This was more than three years before the arbitral proceedings occurred and nearly
three and one-half years before the arbitral decision was rendered. (Doc. 53, at 5 (stating
that arbitration occurred on December 17 and 18, 2018, and that the arbitrator issued his
decision on January 21, 2019)). Because the arbitral decision was rendered after the
individual plaintiffs’ interests attached in their loss of consortium claims, the individual
plaintiffs cannot be in privity with the Estate for purposes of issue preclusion.
Defendant’s argument in favor of issue preclusion therefore must fail, to the extent
defendant’s argument rests on a privity theory.
Defendant, however, offers an alternative argument. Defendant asserts that it is
using the doctrine of issue preclusion “defensively,” and that “defensive issue
preclusion,” as an independently recognized doctrine, does not require mutuality of the
parties to the two actions or that the parties be in privity with each other. (Doc. 53, at
15). “Ordinarily, the phrase ‘defensive use’ of issue preclusion is used to mean the
reliance upon a former judgment, by a stranger to that judgment who is a defendant in
the second action, as conclusively establishing in his favor an issue which he must prove
as an element of his defense.” Opheim v. Am. Interinsurance Exch., 430 N.W.2d 118,
120 (Iowa 1988) (citations omitted). The facts of this case do not invoke “defensive issue
preclusion,” as that phrase is typically used.
Issue preclusion may, however, be “invoked defensively against [a] stranger to
the former judgment.” Id. When issue preclusion is used in this fashion, mutuality of
16
the parties is not required, nor does the party against whom the doctrine is invoked need
to be in privity with a party to the previous judgment. Id. (citations omitted). Instead,
“the party against whom [the doctrine] is invoked must have been so connected in interest
with one of the parties in the former action as to have had a full and fair opportunity to
litigate the relevant claim or issue and be properly bound by its resolution.” Id. (citations
omitted).
The Court must address two separate prongs in determining whether to apply issue
preclusion in this manner. Lyons v. Andersen, 123 F. Supp. 2d 485, 498 (N.D. Iowa
2000). One, the Court must determine whether the party against whom issue preclusion
is to be invoked was sufficiently connected in interest with the party against whom the
issue was decided in the prior action. Id. (citation omitted). Two, the Court must address
whether there was a full and fair opportunity to litigate the issue in the prior action. Id.
(citation omitted).
As discussed above, the only claims before the arbitrator were those claims that
belonged to the Estate. Further, the only parties before the arbitrator were the coexecutors of the Estate, acting on behalf of the Estate. Thus, the individual plaintiffs,
who are before this Court, were not before the arbitrator. The Court finds, however,
that the co-executors of the estate are “so connected in interest” with each of the four
individual plaintiffs that issue preclusion should apply to bar the individual plaintiffs from
arguing that defendant was negligent.
The two co-executors, Mary and Michael Roth, are also individual plaintiffs to
this action. They played an active role in the arbitration proceedings by testifying and
appearing personally for the duration of the proceedings. (See Doc. 53, at 8-9). Further,
the co-executors had full control over how they would litigate the Estate’s claims,
including the wrongful death claim. See Berenger v. Frink, 314 N.W.2d 388, 390 (Iowa
1982) (discussing Iowa’s survival statute). Even though Mary and Michael Roth were
17
acting in their capacities as co-executors, as opposed to in their individual capacities, the
Court finds that Mary and Michael Roth had a full and fair opportunity to litigate the
issue of negligence before the arbitrator. This situation is similar to that of a mother
bringing suit on her own behalf and on behalf of her minor child. In such a case, the
Iowa Court of Appeals held that issue preclusion applied to the minor child’s claims
because the mother was the proper party to bring the child’s claims and had already
litigated her own claims. Bryan v. Hall, 367 N.W.2d 251, 255 (Iowa Ct. App. 1985).
Here, Mary and Michael Roth are parties, in some capacity, to both actions, and
they had every motivation to prove negligence in the arbitral forum. Indeed, given that
the arbitrator was considering claims for breach of contract, wrongful death, dependent
adult abuse, and punitive damages, Mary and Michael Roth likely had a greater
motivation to fully litigate their claims in the arbitral forum than they have here. The
only claims before this Court, in contrast, are the loss of consortium claims. Thus, a
judgment in favor of plaintiffs in this Court would likely be less than any award that the
Estate stood to obtain in the arbitral forum. That Mary and Michael Roth were unable
to prove negligence when faced with the possibility of a larger judgment is telling. The
facts of this case leave the Court persuaded that both prongs of the test for defensive issue
preclusion have been satisfied as to Mary and Michael Roth and that they should be
barred from relitigating the issue of defendant’s negligence.
The Court reaches the same conclusion as to Anna and Bradley Roth, who are
individual plaintiffs but played no role in the arbitral proceedings. Although Anna and
Bradley Roth were not represented at the arbitral proceedings, the Estate was represented,
and it is through the Estate that the individual plaintiffs’ claims are being litigated. The
Estate and Mary and Michael Roth all had the same motivation to fully litigate the issue
of negligence as Anna and Bradley Roth would have had. As has already been explained,
the Estate had a full and fair opportunity to litigate its claims, which included proving
18
that defendant was negligent. The Estate failed to establish negligence in the arbitral
forum, and the Estate should not be given yet another chance to do so.
Although the individual plaintiffs did not agree to arbitrate their claims, they have
not sought to pursue their loss of consortium claims in their own names, as opposed to
through the Estate. The Estate, thus, remains the party through which the individual
plaintiffs are litigating their loss of consortium claims. In light of this crucial fact, the
Court finds that all of the individual plaintiffs were and are “so connected in interest”
with the Estate that the first prong of the defensive issue preclusion test is satisfied.
Likewise, the Court finds that the issue of negligence was fully and fairly litigated in the
arbitral forum, and there is no indication that the individual plaintiffs would argue their
case any differently were they to proceed to trial. Thus, issue preclusion is properly
applicable to all of the individual plaintiffs. The individual plaintiffs are, therefore,
precluded from arguing that defendant was negligent.
Although the individual plaintiffs argue that precluding them from litigating their
consortium claims in this Court renders the Iowa Supreme Court’s opinion pro forma,
the individual plaintiffs are mistaken. The Iowa Supreme Court addressed only whether
the individual plaintiffs were required to arbitrate their loss of consortium claims, but the
court did not address whether preclusive effect could be given to an arbitral decision as
to claims that were not compelled to arbitration. The issues the Iowa Supreme Court
considered are simply different from the issues now before this Court.
Further, the Court notes that an arbitral decision will not always have a preclusive
effect as to loss of consortium claims. Had the Estate not brought its wrongful death
claim and had, for instance, only brought its breach of contract claim, the issue of
negligence would not have been presented to the arbitrator. In the absence of identical
issues before the arbitrator and this Court, the individual plaintiffs’ loss of consortium
claims may not be defeated by the doctrine of issue preclusion. It is only by reason of
19
the discrete facts of this case that the arbitral decision has a preclusive effect in this
Court.6 This Court’s holding, then, does not render the Iowa Supreme Court’s opinion
pro forma.
The individual plaintiffs argue that this result violates their rights to a jury, as
guaranteed under both the Seventh Amendment to the United States Constitution and
Article I, Section 9 of the Iowa Constitution.7 (Doc. 52, at 2-3). Both arguments fail.
The United States Supreme Court has held “that the right to a jury trial does not negate
the issue-preclusive effect of a judgment, even if that judgment was entered by a juryless
tribunal.” B & B Hardware, Inc. v. Hargis Indus., Inc., 135 S. Ct. 1293, 1304 (2015)
(citation omitted). Similarly, the Iowa Supreme Court has repeatedly held that the
doctrine of issue preclusion can properly be applied under Iowa law.
Bandstra v.
6
The Court also notes that the individual plaintiffs cite Astoria Federal Savings and Loan
Association v. Solimino, 501 U.S. 104, 111 (1991), in support of their argument that giving
preclusive effect to the arbitral decision would render the Iowa Supreme Court’s opinion pro
forma. Solimino, however, has no bearing on this case. Solimino addressed a federal statute
that required litigants to pursue state law claims in a state forum before filing in federal court.
Id. at 110-11. The statute, thus, implicitly recognized the possibility of federal litigation between
the same parties following the claimant’s unsuccessful pursuit of his claims in the state forum.
Id. The United States Supreme Court held that because Congress permitted litigants to argue
their claims in both state forums and federal court, the proceedings in the state forum should not
be given preclusive effect in federal court. Id. at 111. Importantly, the statute required litigants
to pursue state remedies before federal remedies, meaning that no claim would be argued for the
first time in federal court, and the federal claims would always be precluded by the state
determinations if the Court were to permit the application of issue preclusion in the federal
action. Id. at 110-11. The facts of this case are markedly different, and the rationale from
Solimino is inapplicable in this case.
7
The individual plaintiffs only explicitly argue that applying that the arbitrator’s decision to them
would violate their constitutional rights to trial by jury. The individual plaintiffs do not argue
that the doctrine of issue preclusion, which would have the same effect as holding the arbitrator’s
decision binding as to the individual plaintiffs, is unconstitutional. Nonetheless, the Court will
address the constitutionality of issue preclusion under both the federal Constitution and the Iowa
Constitution.
20
Covenant Reformed Church, 913 N.W.2d 19, 51 (Iowa 2018) (“Although offensive use
of issue preclusion is allowed in Iowa, it is more restrictively and cautiously applied than
defensive issue preclusion.” (citing Buckingham v. Fed. Land Bank Ass’n, 398 N.W.2d
873, 876 (Iowa 1987))). The individual plaintiffs’ arguments as to the constitutionality
of barring them from going to trial on the issue of negligence, thus, fail.
IV.
PROCEDURAL POSTURE
Finally, the Court finds it procedurally proper to grant summary judgment in favor
of defendant as to the individual plaintiffs’ loss of consortium claims. The parties
requested that the Court address the applicability of issue preclusion, and the parties knew
when they made the request that if the Court were to find issue preclusion applicable, the
individual plaintiffs would be unable to establish a necessary element of their claims.
The Court ordered the parties to brief the issue, and the parties did so. The Court held
a hearing, at the beginning of which the Court informed the parties that it viewed one
theory as being that the matter at hand was essentially a summary judgment issue. (Doc.
56, at 6-7). The Court then gave the parties an opportunity to argue their positions at the
hearing, and the Court permitted the parties to submit supplemental briefing after the
hearing. Toward the conclusion of the hearing, the Court reiterated its position that it
viewed the matter as being, essentially, a summary judgment issue. (Id., at 54).
Federal Rule of Civil Procedure 56(f) requires a court to give “notice and a
reasonable time to respond” before granting summary judgment for a non-movant, on
grounds not raised by a party, or “on its own after identifying for the parties material
facts that may not genuinely be in dispute.” Here, the parties first raised the potentially
dispositive nature of issue preclusion, and the Court’s ruling fits squarely within the
parties’ arguments. The Court thus finds summary judgment proper for two separate
reasons.
21
First, because the parties raised the issue before the Court, and because the parties
requested that the Court set a briefing schedule to address the issue, the Court views the
parties’ request as seeking leave of Court to submit dispositive motions. The deadline to
submit dispositive motions was October 1, 2018 (Doc. 29, at 3), which was
approximately three and one-half months before the arbitrator issued his decision. In
light of the arbitral decision’s issuance coming after the dispositive motions deadline, the
Court finds that the parties’ failure to timely move for an extension of the dispositive
motions deadline was due to excusable neglect. See FED. R. CIV. P. 6(b)(1)(B) (“When
an act may or must be done within a specified time, the court may, for good cause, extend
the time . . . on motion made after the time has expired if the party failed to act because
of excusable neglect.”). Further, the parties timely notified the Court that the arbitrator’s
decision created a potentially dispositive issue. The Court finds that the creation of this
dispositive issue warrants good cause to modify the Scheduling Order. See FED. R. CIV.
P. 16(b)(4) (“A schedule may be modified only for good cause and with the judge’s
consent.”). In permitting the parties to brief the issue, the Court effectively extended the
deadline to submit dispositive motions through the dates established in the briefing order.
(See Doc. 48). The Court is now granting defendant’s motion for summary judgment as
to the individual plaintiffs’ loss of consortium claims.
Further, even if the Court were not of the view that the parties moved for summary
judgment, the Court could properly grant summary judgment on its own. The Court’s
notice to the parties that it was considering the issues before the Court as being summary
judgment issues was more than sufficient under Rule 56. The Court held two separate
hearings, during which the Court discussed with the parties, at the parties’ request, the
potentially dispositive nature of the arbitrator’s decision (See Docs. 47, 55), and the Court
repeatedly informed the parties that it considered the issues to be, essentially, “summary
judgment” issues. The Eighth Circuit Court of Appeals has held that lesser notice is
22
sufficient under Rule 56. See Macquarie Bank Ltd. v. Knickel, 793 F.3d 926, 935-36
(8th Cir. 2015) (upholding summary judgment where the court informed the parties as to
the dispositive issue during the final pretrial conference, without explicitly referring to
the issue as a “summary judgment” issue).
Further, the Eighth Circuit requires only that a party be given an opportunity to
respond to the issue that the Court ultimately rules on. Id. Again, this Court has gone
above the requirements of Rule 56. The Court held two hearings to address the issue,
one of which was scheduled for the sole reason of addressing the merits of the potentially
dispositive issues, and the Court permitted the parties to submit opening briefs and
supplemental briefs on the issue. The parties had every opportunity to argue the issues
at hand, and they did so vigorously. Thus, the Court finds it procedurally proper to grant
summary judgment under Rule 56(f).
V.
CONCLUSION
For the reasons stated above, the parties’ Stipulation for Order Confirming
Arbitration Decision and Directing Entry of Judgment Thereon (Doc. 46) is granted to
the extent the pleading seeks entry of judgment on Counts I, II, III, and V, denied to the
extent the pleading seeks entry of judgment as to Count IV, and denied to the extent the
pleading seeks entry of the parties’ proposed order (Doc. 46-3). Defendant’s individually
filed Motion Requesting Court to Execute Proposed Order Confirming Arbitration
Decision and Directing Entry of Judgment Thereon, in Accordance with the Parties’
Stipulation (Doc. 49) is denied as moot to the extent the pleading seeks entry of judgment
on Counts I, II, III, and V, and denied to the remaining extent the pleading constitutes a
motion.
23
Summary judgment is rendered in favor of defendant as to Count IV. The Clerk
of Court is directed to enter judgment in defendant’s favor as to all counts.
IT IS SO ORDERED this 14th day of May, 2019.
_____________________________
C.J. Williams
United States District Judge
Northern District of Iowa
24
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