Premier Electrical Construction Co. v. National Electrical Contractors Association Inc.

The National Electrical Contractors Association (NECA) (defendant) established a fund to help defray NECA’s collective-bargaining costs. A prior agreement between an electrical-workers’ union and nonunion electrical contractors, including Premier Electrical Construction Company (Premier) (plaintiff), required the contractors to make a 1 percent contribution to the fund. The nonunion contractors filed a class-action lawsuit in Maryland against the association, the union, and the fund to challenge the contribution requirement. The Maryland court granted class certification three years later and ruled that the contribution requirement was illegal under the federal antitrust laws. The Maryland court deferred giving class members the required notice of class certification while the defendants appealed. The Maryland case settled while the appeals were pending. Premier, which did not like the settlement and wanted to assert a different damages theory, opted out of the Maryland class. Premier had a pending action against the association and the fund in an Illinois federal district court and asked the court in that action to apply offensive nonmutual collateral estoppel and bind the association and the fund to the rulings in the Maryland action that the fund contributions violated the federal antitrust laws. The Illinois district court reasoned that allowing issue preclusion would reduce claims and preserve judicial resources. The association and the fund appealed and argued that Premier should not be allowed the benefit of preclusion because Premier had six years to raise its theory of damages in the Maryland action.