Lucky Brand Dungarees Inc. v. Marcel Fashions Group, Inc. 590 U.S. ___ (2020), was a United States Supreme Court case in which the Court held that claim preclusion did not apply to a defense that could have been raised in a previous case between two parties when the "common nucleus of operative fact" was different.
Lucky Brand would file suit against Marcel in the United States District Court for the Southern District of New York in 2005 alleging that the company copied aspects of Lucky Brand's clothing line and logo.
The District Court would find that Marcel's allegations were too similar to those in 2005 and agree with Lucky Brand, but the United States Court of Appeals for the Second Circuit would disagree and state that Marcel still has a right to sue.
The District Court would side with Lucky Brand and dismiss the case.
In a unanimous decision penned by Justice Sonia Sotomayor, the Court's central line of reasoning was whether "claim preclusion applies to defenses raised in a later suit" as detailed in the Court's opinion, and determining whether defense preclusion falls within the lines of res judicata.
Highlighting that res judicata involves both issue preclusion (also known as collateral estoppel) which bars repeated litigation of issues that have been settled and were central to the outcome of the case, and claim preclusion (occasionally also called res judicata), barring issues that "could have been raised and decided in a prior action––even if they were not actually litigated."
In citing Davis v. Brown (1877), preclusions occur "only upon the matter actually at issue and determined in the original action".