Court: Court of Appeals for the Sixth Circuit; June 16, 1995; Federal Appellate Court
Under Sixth Circuit Rule 24(c), unpublished dispositions are disfavored for citation except in specific circumstances and require service of copies when cited. In the case of MicroVote Corporation v. Terry Casey, the core issue was whether the voluntary dismissal of a state court action against the Franklin County Board of Elections constituted an adjudication on the merits due to a prior dismissal of a similar claim against the Franklin County Board of County Commissioners. The district court determined that the two actions were sufficiently related, leading to a bar on the plaintiff from pursuing the same claim in federal court. Additionally, the court found that the plaintiff lacked standing for any claims not barred by the prior dismissals.
The context involves a bid process where MicroVote Corporation proposed to supply voting machines, but the Board of Elections awarded the contract to a competitor, R.F. Shoup Corporation. Following the award, MicroVote initiated two state court actions challenging the decision, both of which were dismissed without prejudice. Subsequently, MicroVote filed a federal diversity action, reiterating its challenge to the contract award and alleging an illegal transfer of the contract to Veeder-Root Corporation, which was tied to the performance guaranty for Shoup. The district court's judgment, affirming the dismissal based on the two dismissal rule and standing issues, was upheld.
Veeder-Root filed a motion to dismiss MicroVote's complaint based on the doctrine of res judicata, asserting that MicroVote had previously dismissed two similar actions. The county defendants filed a similar motion. The district court, presided over by Judge Holschuh, initially declined to dismiss claims related to illegal assignments, as Veeder-Root had not assumed the contract until after MicroVote's state court actions were dismissed. However, the court found that MicroVote's challenges to the legality of the contract award to Shoup were indeed the same claims and dismissed them on res judicata grounds under Ohio's two dismissal rule. Subsequently, Veeder-Root and the county defendants moved to dismiss MicroVote's illegal assignment claims, arguing MicroVote lacked standing. The district court converted these motions to summary judgment and granted them. Shoup and its president were dismissed for lack of service, leading to the overall dismissal of the action on July 19, 1994. MicroVote appealed in mid-August.
Ohio's Rule 41(A)(1) allows for voluntary dismissals without prejudice, but if a plaintiff previously dismissed an action based on the same claim, the subsequent dismissal operates as an adjudication on the merits, effectively a dismissal with prejudice, making any refiled action susceptible to res judicata. The Ohio test for determining if two suits concern the same cause of action is based on the facts necessary to support both claims. In this case, the same facts were needed for MicroVote's claims regarding the contract award to Shoup. The absence of identical defendants in earlier cases does not preclude applying res judicata, as Ohio law also recognizes privity between parties. The court concluded that sufficient mutuality of interest existed between the Board of Elections and the Board of County Commissioners, justifying the application of the two dismissal rule. The financial relationship and the requirement that county commissioners may adopt voting machines upon recommendation from the board of elections further established this connection.
The procurement process for voting machines involved both the Board of Elections and the Board of County Commissioners, with the Board of Elections recommending the Shoup machines through a competitive bidding process. Bidders, including MicroVote, were aware that the contract would be with the county commissioners. Under Ohio law, both boards were necessary for the acquisition, creating a critical connection for any legal claims. MicroVote, not being a party to the Shoup contract, lacked standing to challenge any alleged breach since standing is limited to parties directly involved in the contract. Although MicroVote was a disappointed bidder, this status did not grant it any rights regarding contract administration. If the county had canceled the contract and awarded a new one without bidding, MicroVote might have had grounds for a challenge, but this scenario did not occur. Veeder-Root Corporation guaranteed Shoup's contract performance and took over the contract as per its guarantee, with no new contract requiring bids issued. The district court's judgment was affirmed, confirming the absence of merit in MicroVote's claims.
