Capitol Hill Group, Inc. v. Pillsbury, Winthrop, Shaw, Pittman, LLP
United States Court of Appeals for the District of Columbia Circuit
569 F.3d 485 (2009)
During Capitol Hill Group's (CHG) (plaintiff) bankruptcy proceeding, its law firm Shaw Pittman (defendant) withdrew from representing CHG; a zoning board then sent an important order affecting CHG's rights to Shaw Pittman rather than CHG, apparently unaware representation had ended. In the same bankruptcy proceeding, CHG had separately challenged Shaw Pittman's fees as unreasonable given the quality of representation, and the bankruptcy court ruled the fees were appropriate. CHG later sued Shaw Pittman separately, alleging the firm's failure to forward the zoning order to CHG constituted malpractice; the district court granted Shaw Pittman summary judgment on res judicata grounds, and CHG appealed.
Whether a permissive counterclaim is barred by res judicata if allowing it to move forward would nullify an earlier judgment or impair rights established in the earlier action.