Podhorn v. Paragon Group, Inc.

After landlord Paragon Group, Inc. (defendant) obtained a default judgment against its tenants, the Podhorns (plaintiffs), for unpaid rent in state circuit court, the Podhorns later sued Paragon in federal court for constructive eviction, breach of the implied warranty of habitability, and other theories tied to the same tenancy. Paragon moved to dismiss, arguing the claims were compulsory counterclaims that should have been raised in the earlier suit; the Podhorns argued the associate circuit judge in that earlier suit lacked jurisdiction to hear claims of that size.