Unpublished Disposition, 862 F.2d 875 (9th Cir. 1988)

MEMORANDUM^* 

This is an appeal from the district court's dismissal of plaintiff-appellant Stites' action. Stites sought to recover damages allegedly arising out of his legal representation of appellee Ross in certain insurance matters and Ross' termination of that representation. Stites attempted to set forth a cause of action for civil liability under the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. §§ 1961-68 (1982 & Supp. IV 1986) ("RICO"). The district court dismissed the action as failing to state a claim upon which relief could be granted, and Stites appeals, claiming he should have been given leave to amend his complaint.

The record now reflects, however, that Stites previously sued Ross in California state court. The matter proceeded to final judgment against Stites on the merits in Superior Court, and the Court of Appeal affirmed in an unpublished disposition. Stites' action in that case was based upon the very same occurrences underlying his complaint in this case. The claim before us is therefore barred by the doctrine of res judicata.

The California state decision is given the same preclusive effect in federal court it would be given in the California state courts. See 28 U.S.C. § 1738 (1982); Migra v. Warren City School Dist. Bd. of Educ., 465 U.S. 75, 81 (1984). The California state decision was unpublished. Unpublished decisions in California have no precedential value; however, they may be used to apply the doctrines of res judicata, collateral estoppel, and law of the case. Cal.R.Ct. 877.

In determining the scope of the prior cause of action for res judicata purposes, the federal courts apply California's "primary right" theory. Takahashi v. Board of Trustees, 783 F.2d 848, 851 (9th Cir.), cert. denied, 476 U.S. 1182 (1986). The significant factor in determining whether the identical primary right is at stake in both cases is to look at the harm suffered. Id. In Takahashi, a school teacher using California state law theories lost her California state court action for review of a school board's incompetency determination. She then attempted to bring a federal court action regarding the same occurrences using federal statutory and constitutional theories. The court found that the primary right at stake in both cases was plaintiff's alleged right to employment. Id. "While stating the primary right asserted in her first action in constitutional terms, Takahashi has failed to allege a new injury. 'Even where there are multiple legal theories upon which recovery might be predicated, one injury gives rise to only one claim of relief.' " Id., quoting Slater v. Blackwood, 15 Cal. 3d 791, 126 Cal. Rptr. 225, 543 P.2d 593 (1975). See also Los Angeles Branch NAACP v. Los Angeles Unified School Dist., 750 F.2d 731 (9th Cir. 1984), cert. denied, 474 U.S. 247 (1985).

As in Takahashi, plaintiff here has attempted to bring a new cause of action regarding the same primary right litigated to final judgment in state court--his right to recover attorney's fees from Ross. The use of a new legal theory cannot save him from a res judicata bar. See id.; see also Restatement, Second, Judgments Sec. 25 (1980). He could and should have brought his RICO claim in his state court case. See Cianci v. Superior Court, 40 Cal. 3d 903, 221 Cal. Rptr. 575, 710 P.2d 375 (1985).

Stites points out that he has named as defendants in this case, in addition to Ross, two business corporations Ross allegedly controls. He asserts that the California judgment does not in and of itself bar an action against the business corporations as they were not parties to it. However, remand of the case to permit an attempt to state a claim against the corporations would be fruitless. It has not been suggested that the corporations had anything to do with the events giving rise to the cause of action. No liability of the corporations could be established without first establishing the liability of Mr. Ross individually. The res judicata bar found here operates against any claim based on Ross' liability for the loss of Stites' professional fees for representing Ross.

The district court's dismissal of the action is AFFIRMED.